**AMENDMENT      NO.1 TO THE**

**LICENSE      AGREEMENT**

**EFFECTIVE      MARCH 12, 2003**

**BETWEEN      OCUSENSE INC.**

**AND**

**THE      REGENTS OF THE UNIVERSITY OF CALIFORNIA**

**FOR**

**INVENTION      DOCKET NO. SD2002-180**

**"VOLUME      INDEPENDENT TEAR FILM OSMOMETER"**

*Whereas,      *

*Whereas,      *

**1.5               **
**"Patent      Rights" **

**5.2      Patent Infringement.**

|   |                          (a) | If                LICENSEE learns of any substantial infringement of Patent Rights,                LICENSEE                shall so inform UNIVERSITY and provide UNIVERSITY with reasonable                evidence                of the infringement, and UNIVERSITY hereby agrees to take no action                for at                least ninety (90) days thereafter. If UNIVERSITY, to the extent of                the                actual knowledge of the Licensing Officer responsible for administration                of the Agreement, learns of any substantial infringement of Patent                Rights,                UNIVERSITY shall so inform LICENSEE and provide LICENSEE with reasonable                evidence of the infringement, and LICENSEE hereby agrees to take                no action                for at least ninety (90) days thereafter. Neither party shall notify                a                third party of the infringement of Patent Rights without the consent                of                the other party. Both parties shall use reasonable efforts and cooperation                to terminate infringement without                litigation. |
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| (b)   | If                infringing activity of potential commercial significance by the infringer                has not been abated within ninety (90) days following the date notice                of                such infringing activity is given to the other party pursuant to                5.2(a)                above, the LICENSEE shall have the first right to institute suit                for                patent infringement against the infringer. UNIVERSITY may voluntarily                join                such suit at its own expense, but may not thereafter commence suit                against                the infringer for the acts of infringement that are the subject of                the                Licensee's suit or any judgment rendered in that suit. The LICENSEE                may                not join UNIVERSITY in a suit initiated by the LICENSEE without                UNIVERSITY's prior written consent, provided, however, that if UNIVERSITY                is determined by a court to be a necessary or required party in any                such                suit, then no consent shall be required. If, in a suit initiated                by the                LICENSEE, UNIVERSITY is involuntarily joined other than by the LICENSEE,                or if UNIVERSITY is joined because it is deemed to be a necessary                or                required party, the LICENSEE will pay any costs incurred by UNIVERSITY                arising out of such suit, including but not limited to, any reasonable                legal fees of counsel that UNIVERSITY selects and retains to represent                it                in the suit. |
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| (c)   | Subject                to the immediately following sentence, recoveries from actions brought                by                LICENSEE pursuant to Paragraph 5.2(b) shall belong to the LICENSEE,                provided, however, that the amount such recoveries exceed LICENSEE's                expenses (and UNIVERSITY's expenses if it voluntarily joins such                suit, in                which case UNIVERSITY shall be reimbursed its expenses if such expenses                are not otherwise awarded to UNIVERSITY) for such actions (the "Net                Award") shall be (i) subject to the royalty in Paragraph 3.1(g) above                if                the Net Award of any such recovery is considered to be the recovery                of                LICENSEE's "Net Profits" that were lost due to the infringing activity                or                if the court does not specify how the amount of recovery was calculated,                and such recovery includes the royalties that would have been paid                to                UNIVERSITY, for cases in which the UNIVERSITY is not a party, or                (ii)                subject to the sublicensing royalties in Paragraph 3.l(e) or 3.l(f)                above                as may be appropriate if the Net Award is considered to be "royalties"                payable to LICENSEE as if in a LICENSEE-Sublicensee relationship,                for all                cases whether or not UNIVERSITY is a party, or (iii) to the extent                the                immediately preceding subparagraph (ii) does not apply, shared                proportionately according to costs borne by each party if the UNIVERSITY                voluntarily joins or is involuntarily joined as a party, provided,                however, that in this scenario, UNIVERSITY shall receive a minimum                of 5%                of the Net Award if the UNIVERSITY is not otherwise awarded the royalties                that would have been paid to UNIVERSITY. In a LICENSEE initiated                suit to                which the UNIVERSITY is a party (whether voluntarily or involuntarily),                enhanced damages, i.e. damages assessed against the infringer(s)                as a                penalty, such as trebling of damages for willful infringement should                be                shared 50/50 between the LICENSEE and the UNIVERSITY after all expenses                for each party have been paid or reimbursed. If LICENSEE has not                initiated                any action to abate the infringing activity within ninety (90) days                after                the expiration of the ninety (90) days after notice of such infringing                activity is given to the other party pursuant to 5.2(a) above, then                UNIVERSITY shall have the right to bring such suit, and recoveries                from                such actions brought by UNIVERSITY shall belong entirely to                UNIVERSITY. |
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| (d)   | Each                party shall cooperate with the other in litigation proceedings at                the                expense of the party bringing suit. Litigation shall be controlled                by the                party bringing the suit, except that UNIVERSITY may be represented                by                counsel of its choice in any suit brought by                LICENSEE. |
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**OCUSENSE        INC.                                                                                                                                                                             THE REGENTS OF THE**

**                                                                                                                                                                                                            UNIVERSITY        OF CALIFORNIA:**

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