In this task, you're given a passage that represents a legal contract or clause between multiple parties. Your job is to write questions that ask the basic details corresponding to the legal contracts or clauses. Avoid questions that can be answered correctly without actually understanding the paragraph, and which might have multiple answers. The answer to each question should be unambiguous.

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EXECUTION VERSION

Exhibit 2.4

INTELLECTUAL PROPERTY AGREEMENT

by and between

HONEYWELL INTERNATIONAL INC.

and

GARRETT MOTION INC.

Dated as of September 27, 2018

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TABLE OF CONTENTS Page

ARTICLE I DEFINITIONS Section 1.01. Definitions 1 ARTICLE II RECORDATION OF INTELLECTUAL PROPERTY RIGHTS ASSIGNMENT AGREEMENTS

Section 2.01. Intellectual Property Assignment Agreements 4 Section 2.02. Recordation 4 Section 2.03. Security Interests 4

ARTICLE III LICENSES AND COVENANTS FROM HONEYWELL TO SPINCO

Section 3.01. License Grants 4 Section 3.02. Other Covenants 5 Section 3.03. Honeywell Content 6

ARTICLE IV LICENSES AND COVENANTS FROM SPINCO TO HONEYWELL Section 4.01. License Grants 7 Section 4.02. Other Covenants 7

ARTICLE V ADDITIONAL INTELLECTUAL PROPERTY RELATED MATTERS

Section 5.01. Assignments and Licenses 8 Section 5.02. No Implied Licenses 9 Section 5.03. No Obligation To Prosecute or Maintain Patents 9 Section 5.04. Technical Assistance 9 Section 5.05. Group Members 9 Section 5.06. R&D Projects 9

ARTICLE VI CONFIDENTIAL INFORMATION

Section 6.01. Confidentiality 9 i

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ARTICLE VII LIMITATION OF LIABILITY AND WARRANTY DISCLAIMER

Section 7.01. Limitation on Liability 9 Section 7.02. Disclaimer of Representations and Warranties 10

ARTICLE VIII TRANSFERABILITY AND ASSIGNMENT

Section 8.01. No Assignment or Transfer Without Consent 10 Section 8.02. Divested Businesses 11

ARTICLE IX TERMINATION Section 9.01. Termination by Both Parties 11 Section 9.02. Termination prior to the Distribution 11 Section 9.03. Effect of Termination; Survival 11 ARTICLE X FURTHER ASSURANCES

Section 10.01. Further Assurances 11

ARTICLE XI MISCELLANEOUS

Section 11.01. Counterparts; Entire Agreement; Corporate Power 12 Section 11.02. Dispute Resolution 12 Section 11.03. Governing Law; Jurisdiction 13 Section 11.04. Waiver of Jury Trial 13 Section 11.05. Court-Ordered Interim Relief 13 Section 11.06. Specific Performance 14 Section 11.07. Third-Party Beneficiaries 14 Section 11.08. Notices 14 Section 11.09. Import and Export Control 15 Section 11.10. Bankruptcy 15 Section 11.11. Severability 15 Section 11.12. Expenses 16 Section 11.13. Headings 16 Section 11.14. Survival of Covenants 16 Section 11.15. Waivers of Default 16 Section 11.16. Amendments 16 Section 11.17. Interpretation 16

EXHIBIT A1 - Patent Assignment Agreement EXHIBIT A2 - Trademark Assignment Agreement EXHIBIT A3 - Copyright Assignment Agreement EXHIBIT A4 - Domain Name Assignment Agreement EXHIBIT A5 - Invention Disclosure Assignment Agreement ii

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SCHEDULE A - SpinCo Patents SCHEDULE B - SpinCo IDs SCHEDULE C - SpinCo Trademarks SCHEDULE D - SpinCo Domain Names SCHEDULE E - Registered SpinCo Copyrights SCHEDULE F - R&D Projects SCHEDULE G - Honeywell Content iii

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INTELLECTUAL PROPERTY AGREEMENT, dated as of September 27, 2018 (this Agreement), by and between HONEYWELL INTERNATIONAL INC., a Delaware corporation (Honeywell), and GARRETT MOTION INC., a Delaware corporation (SpinCo).

RECITALS

WHEREAS, in connection with the contemplated Spin-Off of SpinCo and concurrently with the execution of this Agreement, Honeywell and SpinCo are entering into a Separation and Distribution Agreement (the Separation Agreement);

WHEREAS, pursuant to the Separation Agreement and the other Ancillary Agreements, as of the Distribution Date, the Honeywell IP has been allocated to the Honeywell Group and the SpinCo IP has been allocated to the SpinCo Group;

WHEREAS, the Parties wish to record the transfers of any registrations or applications of Honeywell IP and SpinCo IP, as applicable, to the extent the ownership thereof has transferred from a member of the Honeywell Group to a member of the SpinCo Group, or vice versa, pursuant to the Separation Agreement or any other Ancillary Agreement;

WHEREAS, pursuant to the Separation Agreement and the other Ancillary Agreements, as of the Distribution Date, the Honeywell IP allocated to the Honeywell Group includes the Honeywell Shared IP and the SpinCo IP allocated to the SpinCo Group includes the SpinCo Shared IP;

WHEREAS, it is the intent of the Parties that Honeywell grant a license to SpinCo in the Honeywell Shared IP, subject to the terms and conditions set forth in this Agreement;

WHEREAS, it is the intent of the Parties that SpinCo grant a license to Honeywell in the SpinCo Shared IP, subject to the terms and conditions set forth in this Agreement; and

WHEREAS, it is the intent of the Parties that Honeywell license certain other intellectual property rights to SpinCo and that SpinCo license certain other intellectual property rights to Honeywell.

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement, the Parties, intending to be legally bound, hereby agree as follows:

ARTICLE I DEFINITIONS

Section 1.01. Definitions. As used in this Agreement, the following terms have the meanings set forth below. Capitalized terms used, but not defined in this Agreement shall have the meanings ascribed to such terms in the Separation Agreement or any other Ancillary Agreement, as applicable.

Bankruptcy Code has the meaning set forth in Section 11.10.

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Copyright Assignment Agreement has the meaning set forth in Section 2.01.

Copyrights means copyrights, works of authorship (including all translations, adaptations, derivations and combinations thereof), mask works, designs and database rights, including, in each case, any registrations and applications therefor.

Divested Entity has the meaning set forth in Section 8.02.

Domain Name Assignment Agreement has the meaning set forth in Section 2.01.

Domain Names means Internet domain names, including top level domain names and global top level domain names, URLs, social media identifiers, handles and tags.

Honeywell Content means the confidential and proprietary materials of Honeywell IP protected by Trade Secret and/or Copyright Law set forth on Schedule G.

Honeywell IP means all Intellectual Property Rights owned by the Honeywell Group or the SpinCo Group as of immediately prior to the Distribution, other than the SpinCo IP.

Honeywell Shared IP has the meaning set forth in Section 3.01(a).

Honeywell Trade Secrets means the Trade Secrets included in the Honeywell IP.

Honeywell Trademarks means the Trademarks included in the Honeywell IP.

Intellectual Property Assignment Agreements has the meaning set forth in Section 2.01.

Intellectual Property Rights or IPR means any and all intellectual property rights existing anywhere in the world associated with any and all (a) Patents, (b) Trademarks, (c) Copyrights, (d) Domain Names, (e) Software, (f) Trade Secrets and other confidential information, (g) all tangible embodiments of the foregoing in whatever form or medium and (h) any other legal protections and rights related to any of the foregoing. Intellectual Property Rights specifically excludes contractual rights (including license grants from third parties).

Invention Disclosure Assignment Agreement has the meaning set forth in Section 2.01.

Party means either party hereto, and Parties means both parties hereto.

Patent Assignment Agreement has the meaning set forth in Section 2.01.

Patents means patents (including all reissues, divisionals, continuations, continuations-in-part, reexaminations, supplemental examinations, inter partes review, post-grant oppositions, covered business methods reviews, substitutions and extensions thereof), patent registrations and applications, including provisional applications, statutory invention registrations, invention disclosures and inventions. 2

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R&D Projects means the R&D Projects listed or described in Schedule F, each of which shall be subject to a separate agreement as set forth in Section 5.06.

Software means any and all (a) computer programs and applications, including any and all software implementations of algorithms, models and methodologies, whether in source code, object code, human readable form or other form, (b) databases and compilations, including any and all data and collections of data, whether machine readable or otherwise, (c) descriptions, flow charts and other work product used to design, plan, organize and develop any of the foregoing, screens, user interfaces, report formats, firmware, development tools, templates, menus, buttons and icons, (d) all documentation including user manuals and other training documentation related to any of the foregoing and (e) all tangible embodiments of the foregoing in whatever form or medium now known or yet to be created, including all disks, diskettes and tapes.

SpinCo Copyrights means (i) unregistered Copyrights that are owned by the Honeywell Group or the SpinCo Group as of immediately prior to the Distribution and that are exclusively used in or related to the SpinCo Business and (ii) the registered Copyrights identified on Schedule E hereto.

SpinCo Domain Names means the Domain Names listed on Schedule D, in each case excluding any Trademarks containing Honeywell or any transliteration or translation thereof or any version of the Honeywell and Design logo.

SpinCo IDs means the invention disclosures listed or described on Schedule B.

SpinCo IP means (a) the SpinCo Patents, (b) the SpinCo Copyrights, (c) the SpinCo Domain Names, (d) the SpinCo Trade Secrets, (e) the SpinCo Trademarks and (f) the SpinCo IDs.

SpinCo Patents means the Patents identified on Schedule A.

SpinCo Shared IP has the meaning set forth in Section 4.01(a).

SpinCo Trade Secrets means the Trade Secrets known to the Parties that are owned by the Honeywell Group or SpinCo Group as of immediately prior to the Distribution and that are exclusively used by or related to the SpinCo Business.

SpinCo Trademarks means the Trademarks identified on Schedule C.

Trade Secrets means all forms and types of financial, business, scientific, technical, economic or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs or codes, whether tangible or intangible, and whether or how stored, compiled or memorialized physically, electronically, graphically, photographically or in writing, to the extent that the owner thereof has taken reasonable measures to keep such information secret and the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, the public.

Trademark Assignment Agreement has the meaning set forth in Section 2.01. 3

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Trademarks means trademarks, service marks, trade names, logos, slogans, trade dress or other source identifiers, including any registration or any application for registration therefor, together with all goodwill associated therewith.

ARTICLE II RECORDATION OF INTELLECTUAL PROPERTY RIGHTS ASSIGNMENT AGREEMENTS

Section 2.01. Intellectual Property Assignment Agreements. In order to carry out the intent of the Parties with respect to the recordation of the transfers of any registrations or applications of Honeywell IP or SpinCo IP, as applicable, to the extent the ownership thereof has transferred from a member of the Honeywell Group to a member of the SpinCo Group, or vice versa, pursuant to the Separation Agreement or any other Ancillary Agreement, the Parties shall, and shall cause their respective Group members (as applicable) to, execute intellectual property assignments in a form substantially similar to that attached as Exhibit A1 (the Patent Assignment Agreement), Exhibit A2 (the Trademark Assignment Agreement), Exhibit A3 (the Copyright Assignment Agreement), Exhibit A4 (the Domain Name Assignment Agreement) and Exhibit A5 (the Invention Disclosure Assignment Agreement) as well as such additional case specific assignments as deemed appropriate or necessary under applicable Laws (collectively, the Intellectual Property Assignment Agreements) for recordation with the appropriate Governmental Authority.

Section 2.02. Recordation. The relevant assignee Party shall have the sole responsibility, at its sole cost and expense, to file the Intellectual Property Assignment Agreements and any other forms or documents with the appropriate Governmental Authorities as required to record the transfer of any registrations or applications of Honeywell IP or SpinCo IP that is allocated under the Separation Agreement, as applicable, and the relevant assignor Party hereby consents to such recordation.

Section 2.03. Security Interests. Prior to, on and after the Distribution Date, each Party shall cooperate with the other Party, without any further consideration and at no expense to the other Party, to obtain, cause to be obtained or properly record the release of any outstanding Security Interest attached to any Honeywell IP or SpinCo IP, as applicable, and to take, or cause to be taken, all actions as the other Party may reasonably be requested to take in order to obtain, cause to be obtained or properly record such release.

ARTICLE III LICENSES AND COVENANTS FROM HONEYWELL TO SPINCO

Section 3.01. License Grants.

(a) General. The Parties acknowledge that through the course of a history of integrated operations SpinCo and the members of the SpinCo Group have each obtained knowledge of and access to, or otherwise used, certain Honeywell IP, including Patents, Trade Secrets, copyrighted content, proprietary know-how, and other Intellectual Property Rights that are not otherwise governed expressly by the Separation Agreement or the Ancillary Agreements or identified expressly in the schedules thereto (collectively, Honeywell Shared IP). With regard 4

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to the Honeywell Shared IP, the Parties seek to ensure that SpinCo has the freedom to use such Honeywell Shared IP in the future. Hence, as of the Distribution Date, Honeywell hereby grants, and agrees to cause the members of the Honeywell Group to hereby grant, to SpinCo and the members of the SpinCo Group a non-exclusive, royalty-free, fully-paid, perpetual, sublicenseable (solely to Subsidiaries and suppliers for have-made purposes), worldwide license to use and exercise rights under the Honeywell Shared IP (excluding Trademarks, the Honeywell Content and the subject matter of any other Ancillary Agreement), said license being limited to use of a similar type, scope and extent as used in the SpinCo Business prior to the Distribution Date and the natural growth and development thereof.

(b) Trademarks. The Parties acknowledge and agree that certain rights and obligations with respect to the use by the SpinCo Group of certain Honeywell Trademarks shall be set forth in the Trademark License Agreement. To the extent there is a conflict between the terms of this Agreement and the Trademark License Agreement, the terms of the Trademark License Agreement shall control.

(c) Additional Licenses. For a period of five (5) years after the Distribution Date, in the event any member of the SpinCo Group, in SpinCo's reasonable judgment, requires a license under any Honeywell IP in order to initiate and pursue any new technical projects not covered by the licenses granted in Section 3.01(a), the Parties shall negotiate in good faith to license such Honeywell IP to the applicable member of the SpinCo Group on commercially reasonable terms. Notwithstanding anything to the contrary, if the Parties cannot reach agreement with respect to the terms of a license to Honeywell IP pursuant to the immediately preceding sentence, the applicable member of the SpinCo Group shall be permitted to challenge the validity or enforceability of such Honeywell IP (it being understood that such challenge is the sole remedy available to SpinCo in the event Honeywell does not grant such license, without regard to whether Honeywell has negotiated in good faith).

Section 3.02. Other Covenants.

(a) Honeywell hereby acknowledges (on behalf of itself and each other member of the Honeywell Group) SpinCo's right, title and interest in and to the SpinCo IP. Honeywell agrees that it will not, and agrees to cause each member of the Honeywell Group not to, (i) initiate any Action against any member of the SpinCo Group or its Affiliates for infringement, misappropriation or other violation of any Honeywell IP, (ii) oppose, challenge, petition to cancel, contest or threaten in any way, or assist another party in opposing, challenging, petitioning to cancel, contesting or threatening in any way, any application or registration by SpinCo or its Affiliates or their respective licensees for any SpinCo IP, the use of which is consistent with the use of such SpinCo IP in connection with the SpinCo Business as of immediately prior to the Distribution Date, (iii) engage in any act, or purposefully omit to perform any act, that impairs or adversely affects the rights of SpinCo or any member of the SpinCo Group in and to any SpinCo IP or (iv) apply for any registration with respect to the SpinCo IP (including federal, state and national registrations), in each case of the foregoing clauses (i) - (iv) for a period of five (5) years after the Distribution Date, without the prior written consent of SpinCo, which consent shall not be unreasonably withheld, conditioned or delayed. 5

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(b) SpinCo shall be responsible for policing, protecting and enforcing its own Intellectual Property Rights. Notwithstanding the foregoing, Honeywell will promptly give notice to SpinCo of any actual or threatened, unauthorized use or infringement of the SpinCo IP of which it receives notice, in each case for a period of five (5) years after the Distribution Date.

(c) Notwithstanding anything to the contrary in this Section 3.02, each member of the Honeywell Group shall be permitted to challenge the validity or enforceability of SpinCo IP, in each case solely in response to an Action initiated by a third party where failure to assert such challenge would reasonably be expected to materially prejudice any member of the Honeywell Group's defense to such Action; provided, that the applicable member(s) of the Honeywell Group shall use reasonable best efforts to provide SpinCo with reasonable written notice prior to initiating any such challenge.

(d) All SpinCo Trade Secrets shall be in or shall be moved to the physical possession of the SpinCo Group in a tangible form (including all copies thereof and all notes, extracts or summaries based thereon) prior to the Distribution Date. At the specific written request of SpinCo, Honeywell shall destroy or shall have destroyed any form or copy of any SpinCo Trade Secrets specified by SpinCo in such written request that are in the possession of Honeywell or any members of the Honeywell Group and were not used in the Honeywell Business as of immediately prior to the Distribution, other than SpinCo Trade Secrets that were electronically preserved or recorded by an electronic backup system prior to the Distribution Date and remain within a secure, encrypted data backup system that is subject to industry practice defense, protection and access restriction measures.

Section 3.03. Honeywell Content.

(a) Notwithstanding Section 3.01, Honeywell hereby grants, and agrees to cause the members of the Honeywell Group to hereby grant, to SpinCo and the members of the SpinCo Group, for a period of ten (10) years after the Distribution Date (unless earlier terminated in accordance with Section 3.03(c)), a non-exclusive, royalty-free, fully-paid, non-sublicenseable, non-transferable, worldwide license to use and reproduce the Honeywell Content solely for the SpinCo Group's internal business purposes. For the avoidance of doubt, the Parties acknowledge and agree that SpinCo may distribute the Honeywell Content internally through SpinCo's intranet in the same form and manner that it was distributed on the Honeywell intranet immediately prior to the Distribution Date; provided, that the Honeywell Content may not be used for any purpose other than the SpinCo Group's internal business purposes and may not be shared with any third party without the prior written consent of Honeywell.

(b) SpinCo shall, and shall cause each member of the SpinCo Group to, remove any Honeywell Trademarks or reference to the Honeywell Business appearing on any Honeywell Content as soon as reasonably practicable following the Distribution Date, but in no event later than one hundred and eighty (180) days after the Distribution Date.

(c) Without limiting ARTICLE VIII, the license granted to the SpinCo Group in Section 3.03(a) shall automatically terminate in the event (i) that any member of the SpinCo Group assigns, transfers, licenses or otherwise conveys any rights in or to the Honeywell Content to any third party or (ii) of (x) the sale of all or substantially all of the ownership interests 6

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in, or the assets of, any member of the SpinCo Group in a single transaction or a series of related transactions to one or more third parties, (y) any direct or indirect acquisition, consolidation or merger of any member of the SpinCo Group by, with or into any third party or (z) any spin-off, public offering or other corporate reorganization or single transaction or series of related transactions in which direct or indirect control of any member of the SpinCo Group is transferred to one or more third parties, including by transferring an excess of fifty percent (50%) of such member of the SpinCo Group's voting power, shares or equity, through a merger, consolidation, tender offer or similar transaction to one or more third parties.

ARTICLE IV LICENSES AND COVENANTS FROM SPINCO TO HONEYWELL

Section 4.01. License Grants.

(a) General. The Parties acknowledge that through the course of a history of integrated operations Honeywell and the members of the Honeywell Groups have each obtained knowledge of and access to, or otherwise used, certain SpinCo IP, including Patents, Trade Secrets, copyrighted content, proprietary know-how, and other Intellectual Property Rights that are not otherwise governed expressly by the Separation Agreement or the Ancillary Agreements or identified expressly in the schedules thereto (collectively, SpinCo Shared IP). With regard to the SpinCo Shared IP, the Parties seek to ensure that Honeywell has the freedom to use such SpinCo Shared IP in the future. Hence, as of the Distribution Date, SpinCo hereby grants, and agrees to cause the members of the SpinCo Group to hereby grant, to Honeywell and the members of the Honeywell Group a non-exclusive, royalty-free, fully-paid, perpetual, sublicenseable (solely to Subsidiaries and suppliers for have made purposes), worldwide license to use and exercise rights under the SpinCo Shared IP (excluding Trademarks and the subject matter of any other Ancillary Agreement), said license being limited to use of a similar type, scope and extent as used in the Honeywell Business prior to the Distribution Date and the natural growth and development thereof.

(b) Additional Licenses. For a period of five (5) years following the Distribution Date, in the event any member of the Honeywell Group, in Honeywell's reasonable judgment, requires a license under any SpinCo IP in order to initiate and pursue any technical projects not covered by the licenses granted in Section 4.01(a), the Parties shall negotiate in good faith to license such SpinCo IP to the applicable member of the Honeywell Group on commercially reasonable terms. Notwithstanding anything to the contrary, if the Parties cannot reach agreement with respect to the terms of a license to SpinCo IP pursuant to the immediately preceding sentence, the applicable member of the Honeywell Group shall be permitted to challenge the validity or enforceability of such SpinCo IP (it being understood that such challenge is the sole remedy available to Honeywell in the event SpinCo does not grant such license, without regard to whether SpinCo has negotiated in good faith).

Section 4.02. Other Covenants.

(a) SpinCo hereby acknowledges (on behalf of itself and each other member of the SpinCo Group) Honeywell's right, title and interest in and to the Honeywell IP. SpinCo agrees that it will not, and agrees to cause each member of the SpinCo Group not to, (i) 7

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initiate any Action against any member of the Honeywell Group or its Affiliates for infringement, misappropriation or other violation of any SpinCo IP, (ii) oppose, challenge, petition to cancel, contest or threaten in any way, or assist another party in opposing, challenging, petitioning to cancel, contesting or threatening in any way, any application or registration by the Honeywell Group or its Affiliates or their respective licensees for any Honeywell IP, the use of which is consistent with the use of such Honeywell IP in connection with the Honeywell Business as of immediately prior to the Distribution Date, (iii) engage in any act, or purposefully omit to perform any act, that impairs or adversely affects the rights of Honeywell or any member of the Honeywell Group in and to any Honeywell IP or (iv) apply for any registration with respect to the Honeywell IP (including federal, state and national registrations), in each case of the foregoing clauses (i) - (iv) for a period of five (5) years after the Distribution Date, without the prior written consent of Honeywell, which consent shall not be unreasonably withheld, conditioned or delayed.

(b) Honeywell shall be responsible for policing, protecting and enforcing its own Intellectual Property Rights. Notwithstanding the foregoing, SpinCo will promptly give notice to Honeywell of any actual or threatened, unauthorized use or infringement of the Honeywell IP of which it receives notice, in each case for a period of five (5) years after the Distribution Date.

(c) Notwithstanding anything to the contrary in this Section 4.02, each member of the SpinCo Group shall be permitted to challenge the validity or enforceability of Honeywell IP, in each case solely in response to an Action initiated by a third party where failure to assert such challenge would reasonably be expected to materially any member of the SpinCo Group's defense to such Action; provided, that the applicable member(s) of the SpinCo Group shall use reasonable best efforts to provide Honeywell with reasonable written notice prior to initiating any such challenge.

(d) All Honeywell Trade Secrets shall be in or shall be moved to the physical possession of the Honeywell Group in a tangible form (including all copies thereof and all notes, extracts or summaries based thereon) prior to the Distribution Date. At the specific written request of Honeywell, SpinCo shall destroy or shall have destroyed any form or copy of Honeywell Trade Secrets specified in such written request by Honeywell that are in the possession of SpinCo or any members of the SpinCo Group and were not used in the SpinCo Business as of immediately prior to the Distribution, other than Honeywell Trade Secrets that were electronically preserved or recorded by an electronic backup system prior to the Distribution Date and remain within a secure, encrypted data backup system that is subject to industry practice defense, protection and access restriction measures.

ARTICLE V ADDITIONAL INTELLECTUAL PROPERTY RELATED MATTERS

Section 5.01. Assignments and Licenses. No Party or any member of its Group may assign or grant a license in or to any of its Intellectual Property Rights licensed to the other Party or any member of its Group pursuant to ARTICLE III or ARTICLE IV, unless such assignment or grant is subject to the licenses, covenants and restrictions set forth herein. For the avoidance of doubt, a non-exclusive license grant shall be deemed subject to the licenses granted herein. 8

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Section 5.02. No Implied Licenses. Nothing contained in this Agreement shall be construed as conferring any rights (including the right to sublicense) by implication, estoppel or otherwise, under any Intellectual Property Rights, other than as expressly granted in this Agreement, and all other rights under any Intellectual Property Rights licensed to a Party or the members of its Group hereunder are expressly reserved by the Party granting the license. The Party receiving the license hereunder acknowledges and agrees that the Party (or the applicable member of its Group) granting the license is the sole and exclusive owner of the Intellectual Property Rights so licensed.

Section 5.03. No Obligation To Prosecute or Maintain Patents. Except as expressly set forth in this Agreement, no Party or any member of its Group shall have any obligation to seek, perfect or maintain any protection for any of its Intellectual Property Rights. Without limiting the generality of the foregoing, except as expressly set forth in this Agreement, no Party or any member of its Group shall have any obligation to file any Patent application, to prosecute any Patent, or secure any Patent rights or to maintain any Patent in force.

Section 5.04. Technical Assistance. Except as expressly set forth in this Agreement, in the Separation Agreement or any other mutually executed agreement between the Parties or any of the members of their respective Groups, no Party or any member of its Group shall be required to provide the other Party with any technical assistance or to furnish any other Party with, or obtain on their behalf, any Intellectual Property Rights-related documents, materials or other information or technology.

Section 5.05. Group Members. Each Party shall cause the members of its Group to comply with all applicable provisions of this Agreement.

Section 5.06. R&D Projects. The Parties acknowledge and agree that the R&D Projects shall be governed by certain separate agreements between the Parties. To the extent there is a conflict between the terms of this Agreement and such agreements, the terms of such agreements shall control.

ARTICLE VI CONFIDENTIAL INFORMATION

Section 6.01. Confidentiality. All Trade Secrets and other confidential information of a Party disclosed to the other Party under this Agreement (including the Honeywell Content) shall be deemed confidential and proprietary information of the disclosing Party, shall be subject to the provisions of Section 7.09 of the Separation Agreement and may be used by the receiving Party for the express purpose of effecting the licenses granted herein.

ARTICLE VII LIMITATION OF LIABILITY AND WARRANTY DISCLAIMER

Section 7.01. Limitation on Liability. Without limiting the terms set forth in Section 6.09 of the Separation Agreement, none of Honeywell, SpinCo or any other member of either Group shall in any event have any Liability to the other or to any other member of the other's Group under this Agreement for any indirect, special, punitive or consequential damages, whether or not caused by or resulting from negligence or breach of obligations hereunder and whether or not informed of the possibility of the existence of such damages. 9

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Section 7.02. Disclaimer of Representations and Warranties. Each of Honeywell (on behalf of itself and each other member of the Honeywell Group) and SpinCo (on behalf of itself and each other member of the SpinCo Group) understands and agrees that, except as expressly set forth in this Agreement, no Party is representing or warranting in any way, including any implied warranties of merchantability, fitness for a particular purpose, title, registerability, allowability, enforceability or non-infringement, as to any Intellectual Property Rights licensed hereunder, as to the sufficiency of the Intellectual Property Rights licensed hereunder for the conduct and operations of the SpinCo Business or the Honeywell Business, as applicable, as to the value or freedom from any Security Interests of, or any other matter concerning, any Intellectual Property Rights licensed hereunder, or as to the absence of any defenses or rights of setoff or freedom from counterclaim with respect to any claim or other Intellectual Property Rights of any such Party, or as to the legal sufficiency of any assignment, document or instrument delivered hereunder to convey title to any Intellectual Property Rights or thing of value upon the execution, delivery and filing hereof or thereof. Except as may expressly be set forth herein, any such Intellectual Property Rights are being licensed on an as is, where is basis and the respective licensees shall bear the economic and legal risks related to the use of the Shared Honeywell IP in the SpinCo Business or the Shared SpinCo IP in the Honeywell Business, as applicable.

ARTICLE VIII TRANSFERABILITY AND ASSIGNMENT

Section 8.01. No Assignment or Transfer Without Consent. Except as expressly set forth in this Agreement, neither this Agreement nor any of the rights, interests or obligations under this Agreement, including the licenses granted pursuant to this Agreement, shall be assigned, in whole or in part, by operation of Law or otherwise by either Party without the prior written consent of the other Party. Any purported assignment without such consent shall be void. Notwithstanding the foregoing, if any Party to this Agreement (or any of its successors or permitted assigns) (a) shall enter into a consolidation or merger transaction in which such Party is not the surviving entity and the surviving entity acquires or assumes all or substantially all of such Party's assets, (b) shall transfer all or substantially all of such Party's assets to any Person or (c) shall assign this Agreement to such Party's Affiliates, then, in each such case, the assigning Party (or its successors or permitted assigns, as applicable) shall ensure that the assignee or successor- in-interest expressly assumes in writing all of the obligations of the assigning Party under this Agreement, and the assigning Party shall not be required to seek consent, but shall provide written notice and evidence of such assignment, assumption or succession to the non-assigning Party. Subject to the preceding sentences, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the Parties and their respective successors and assigns. No assignment permitted by this Section 8.01 shall release the assigning Party from liability for the full performance of its obligations under this Agreement. For the avoidance of doubt, in no event will the licenses granted in this Agreement extend to products, product lines, services, apparatus, devices, systems, components, hardware, software, processes, solutions, any combination of the foregoing, or other offerings of the assignee existing on or before the date of the transaction described in clauses (a) or (b) of the preceding sentence, except to the extent that they were licensed under the terms of this Agreement prior to such transaction. 10

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Section 8.02. Divested Businesses. In the event a Party divests a business by (a) spinning off a member of its Group by its sale or other disposition to a third party, (b) reducing ownership or control in a member of its Group so that it no longer qualifiers as a member of its Group under this Agreement or (c) selling or otherwise transferring a line of business to a third party (each such divested entity/line of business, a Divested Entity), the Divested Entity shall retain those licenses granted to it under this Agreement provided that the license shall be limited to the business of the Divested Entity as of the date of divestment and the natural development thereof. The retention of any license grants are subject to the Divested Entity's and, in the event it is acquired by a third party, such third party's execution and delivery to the non-transferring Party, within 90 days of the effective date of such divestment, of a duly authorized, written undertaking, agreeing to be bound by the applicable terms of this Agreement. For the avoidance of doubt, in no event will the licenses retained by a Divested Entity extend to products, product lines, services, apparatus, devices, systems, components, hardware, software, processes, solutions, any combination of the foregoing, or other offerings of a third party acquirer existing on or before the date of the divestment, except to the extent that they were licensed under the terms of this Agreement prior to such divestment.

ARTICLE IX TERMINATION

Section 9.01. Termination by Both Parties. Subject to Section 9.02, this Agreement may not be terminated except by an agreement in writing signed by a duly authorized officer of each of the Parties.

Section 9.02. Termination prior to the Distribution. This Agreement may be terminated by Honeywell at any time, in its sole discretion, prior to the Distribution; provided, however, that this Agreement shall automatically terminate upon the termination of the Separation Agreement in accordance with its terms.

Section 9.03. Effect of Termination; Survival. In the event of any termination of this Agreement prior to the Distribution, neither Party (nor any member of their Group or any of their respective directors or officers) shall have any Liability or further obligation to the other Party or any member of its Group under this Agreement. Except with respect to termination of the Agreement under Section 9.02, notwithstanding anything in this Agreement to the contrary, ARTICLE I, ARTICLE VI, ARTICLE VII, this Section 9.03 and ARTICLE XI shall survive any termination of this Agreement.

ARTICLE X FURTHER ASSURANCES

Section 10.01. Further Assurances.

(a) In addition to the actions specifically provided for elsewhere in this Agreement, each of the Parties shall use reasonable best efforts, prior to, on and after the Distribution Date, to take, or cause to be taken, all actions, and to do, or cause to be done, all things, reasonably necessary, proper or advisable under applicable Laws and agreements to consummate and make effective the transactions contemplated by this Agreement. 11

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(b) Without limiting the foregoing, prior to, on and after the Distribution Date, each Party shall cooperate with the other Party, without any further consideration, but at the expense of the requesting Party, (i) to execute and deliver, or use reasonable best efforts to execute and deliver, or cause to be executed and delivered, all instruments, including any instruments of conveyance, assignment and transfer as such Party may reasonably be requested to execute and deliver by the other Party, (ii) to make, or cause to be made, all filings with, and to obtain, or cause to be obtained, all Consents of any Governmental Authority or any other Person under any permit, license, agreement, indenture or other instrument, and (iii) to take, or cause to be taken, all such other actions as such Party may reasonably be requested to take by the other Party from time to time, consistent with the terms of this Agreement, in order to effectuate the provisions and purposes of this Agreement and any transfers of Intellectual Property Rights or assignments and assumptions of Liabilities related thereto as set forth in the Separation Agreement.

ARTICLE XI MISCELLANEOUS

Section 11.01. Counterparts; Entire Agreement; Corporate Power.

(a) This Agreement may be executed in one or more counterparts, all of which counterparts shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each Party and delivered to the other Party. This Agreement may be executed by facsimile or PDF signature and scanned and exchanged by electronic mail, and such facsimile or PDF signature or scanned and exchanged copies shall constitute an original for all purposes.

(b) This Agreement and the Exhibits and Schedules hereto contain the entire agreement between the Parties with respect to the subject matter hereof and supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter, and there are no agreements or understandings between the Parties with respect to the subject matter hereof other than those set forth or referred to herein or therein.

(c) Honeywell represents on behalf of itself and each other member of the Honeywell Group, and SpinCo represents on behalf of itself and each other member of the SpinCo Group, as follows:

(i) each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; and

(ii) this Agreement has been duly executed and delivered by it and constitutes, or will constitute, a valid and binding agreement of it enforceable in accordance with the terms thereof.

Section 11.02. Dispute Resolution. In the event that either Party, acting reasonably, forms the view that another Party has caused a material breach of the terms of this Agreement, then the Party that forms such a view shall serve written notice of the alleged breach on the other Parties and the Parties shall work together in good faith to resolve any such alleged breach within 12

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thirty (30) days of such notice (a Dispute). If any such alleged breach is not so resolved, then a senior executive of each Party shall, in good faith, attempt to resolve any such alleged breach within the following thirty (30) days of the referral of the matter to the senior executives. If no resolution is reached with respect to any such alleged breach in accordance with the procedures contained in this Section 11.02, then the Parties may seek to resolve such matter in accordance with Section 11.03, Section 11.04 and Section 11.06

Section 11.03. Governing Law; Jurisdiction. Any disputes arising out of or relating to this Agreement, including to its execution, performance or enforcement, shall be governed by, and construed in accordance with, the Laws of the State of New York, regardless of the Laws that might otherwise govern under applicable principles of conflicts of Laws thereof. Each Party irrevocably consents to the exclusive jurisdiction, forum and venue of any state or federal court sitting in New York City in the State of New York over any and all claims, disputes, controversies or disagreements between the Parties or any of their respective Affiliates, successors and assigns under or related to this Agreement or any of the transactions contemplated hereby, including their execution, performance or enforcement, whether in contract, tort or otherwise. Each of the Parties hereby agrees that it shall not assert and shall hereby waive any claim or right or defense that it is not subject to the jurisdiction of such courts, that the venue is improper, that the forum is inconvenient or any similar objection, claim or argument. Each Party agrees that a final judgment in any legal proceeding resolved in accordance with this Section 11.03, Section 11.04, Section 11.05 and Section 11.06 shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Law.

Section 11.04. Waiver of Jury Trial. EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING THEIR EXECUTION, PERFORMANCE OR ENFORCEMENT, WHETHER IN CONTRACT, TORT OR OTHERWISE. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS.

Section 11.05. Court-Ordered Interim Relief. In accordance with Section 11.03 and Section 11.04, at any time after giving notice of a Dispute, each Party shall be entitled to interim measures of protection duly granted by a court of competent jurisdiction: (1) to preserve the status quo pending resolution of the Dispute; (2) to prevent the destruction or loss of documents and other information or things relating to the Dispute; or (3) to prevent the transfer, disposition or hiding of assets. Any such interim measure (or a request therefor to a court of competent jurisdiction) shall not be deemed incompatible with the provisions of Section 11.02, Section 11.03 and Section 11.04. Until such Dispute is resolved in accordance with Section 11.02 or final judgment is rendered in accordance with Section 11.03 and Section 11.04, each Party agrees that such Party shall continue to perform its obligations under this Agreement and that such obligations shall not be subject to any defense or set-off, counterclaim, recoupment or termination. 13

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Section 11.06. Specific Performance. Subject to Section 11.02 and Section 11.05, in the event of any actual or threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the affected Party shall have the right to specific performance and injunctive or other equitable relief of its rights under this Agreement, in addition to any and all other rights and remedies at Law or in equity, and all such rights and remedies shall be cumulative. The other Party shall not oppose the granting of such relief on the basis that money damages are an adequate remedy. The Parties agree that the remedies at Law for any breach or threatened breach hereof, including monetary damages, are inadequate compensation for any loss and that any defense in any action for specific performance that a remedy at Law would be adequate is waived. Any requirements for the securing or posting of any bond with such remedy are waived.

Section 11.07. Third-Party Beneficiaries. Except as otherwise expressly set forth herein or as otherwise may be provided in the Separation Agreement with respect to the rights of any Honeywell Indemnitee or SpinCo Indemnitee, (a) the provisions of this Agreement are solely for the benefit of the Parties hereto and are not intended to confer upon any Person except the Parties hereto any rights or remedies hereunder and (b) there are no third- party beneficiaries of this Agreement and this Agreement shall not provide any third person with any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing without reference to this Agreement.

Section 11.08. Notices. All notices or other communications under this Agreement shall be in writing and shall be deemed to be duly given when (a) delivered in person, (b) on the date received, if sent by a nationally recognized delivery or courier service or (c) upon the earlier of confirmed receipt or the fifth (5th) business day following the date of mailing if sent by registered or certified mail, return receipt requested, postage prepaid and addressed as follows:

If to Honeywell, to:

Honeywell International Inc. 115 Tabor Road Morris Plains, NJ 07950 Attn: Senior Vice President and General Counsel

with a copy to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, NY 10019-6064 Attn: Scott A. Barshay Steven J. Williams email: sbarshay@paulweiss.com swilliams@paulweiss.com Facsimile: 212-492-0040 14

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If to SpinCo, to:

Garrett Motion Inc. c/o Honeywell Transportations Sarl Z.A. La Piece 16 1180 Rolle, Vaud Switzerland Attn: Senior Vice President and General Counsel

with a copy to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, NY 10019-6064 Attn: Scott A. Barshay Steven J. Williams email: sbarshay@paulweiss.com swilliams@paulweiss.com Facsimile: 212-492-0040

Either Party may, by notice to the other Party, change the address to which such notices are to be given. Each Party agrees that nothing in this Agreement shall affect the other Party's right to serve process in any other manner permitted by Law (including pursuant to the rules for foreign service of process authorized by the Hague Convention).

Section 11.09. Import and Export Control. Each Party agrees that it shall comply with all applicable national and international laws and regulations relating to import and/or export control in its country(ies), if any, involving any commodities, software, services or technology within the scope of this Agreement.

Section 11.10. Bankruptcy. The Parties acknowledge and agree that all rights and licenses granted by the other under or pursuant to this Agreement are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the United States Bankruptcy Code, as amended (the Bankruptcy Code), licenses of rights to intellectual property as defined under Section 101 of the Bankruptcy Code. The Parties agree that, notwithstanding anything else in this Agreement, Honeywell and the members of the Honeywell Group and SpinCo and the members of the SpinCo Group, as licensees of such intellectual property rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the Bankruptcy Code (including Honeywell's and the Honeywell Group members' and SpinCo's and the SpinCo Group members' right to the continued enjoyment of the rights and licenses respectively granted by under this Agreement).

Section 11.11. Severability. If any provision of this Agreement or the application thereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to either Party. Upon any such determination, any such provision, to the extent determined to be invalid, void or unenforceable, shall be deemed replaced by a provision that such court determines is valid and enforceable and that comes closest to expressing the intention of the invalid, void or unenforceable provision. 15

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Section 11.12. Expenses. Except as otherwise expressly provided in this Agreement, (i) all third-party fees, costs and expenses incurred by either the Honeywell Group or the SpinCo Group in connection with the provisions of this Agreement prior to or on the Distribution Date, whether payable prior to, on or following the Distribution Date (but excluding, for the avoidance of doubt, any financing fees or interest payable in respect of any indebtedness incurred pursuant to the Debt Incurrence), will be borne and paid by Honeywell and (ii) all third-party fees, costs and expenses incurred by either the Honeywell Group or the SpinCo Group in connection with the provisions of this Agreement following the Distribution Date, whether payable prior to, on or following the Distribution Date, will be borne and paid by the Party incurring such fee, cost or expense.

Section 11.13. Headings. The article, section and paragraph headings contained in this Agreement, including in the table of contents of this Agreement, are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

Section 11.14. Survival of Covenants. Except as expressly set forth in this Agreement, the covenants in this Agreement and the Liabilities for the breach of any obligations in this Agreement shall survive the Spin-Off and shall remain in full force and effect.

Section 11.15. Waivers of Default. No failure or delay of any Party (or the applicable member of its Group) in exercising any right or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. Waiver by any Party of any default by the other Party of any provision of this Agreement shall not be deemed a waiver by the waiving Party of any subsequent or other default.

Section 11.16. Amendments. No provisions of this Agreement shall be deemed waived, amended, supplemented or modified by any Party, unless such waiver, amendment, supplement or modification is in writing and signed by the authorized representative of each Party.

Section 11.17. Interpretation. Words in the singular shall be held to include the plural and vice versa and words of one gender shall be held to include the other gender as the context requires. The terms hereof, herein, herewith and words of similar import, unless otherwise stated, shall be construed to refer to this Agreement as a whole (including all of the schedules hereto) and not to any particular provision of this Agreement. Article, Section or Schedule references are to the articles, sections and schedules of or to this Agreement unless otherwise specified. Any capitalized terms used in any Schedule to this Agreement but not otherwise defined therein shall have the meaning as defined in this Agreement. Any definition of or reference to any agreement, instrument or other document herein (including any reference herein to this Agreement) shall, unless otherwise stated, be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications 16

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set forth therein, including in Section 11.15 above). The word including and words of similar import when used in this Agreement shall mean including, without limitation, unless the context otherwise requires or unless otherwise specified. The word or shall not be exclusive. All references to $ or dollar amounts are to lawful currency of the United States of America. In the event that an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship of any provisions hereof.

[SIGNATURE PAGES FOLLOW] 17

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IN WITNESS WHEREOF, the Parties have caused this Intellectual Property Agreement to be executed by their duly authorized representatives. HONEYWELL INTERNATIONAL INC.

By: /s/ Richard E. Kent Name: Richard Kent Title: Vice President, Deputy General Counsel, Finance and Assistant Secretary

GARRETT MOTION INC.

By: /s/ Su Ping Lu Name: Su Ping Lu Title: President

[Signature Page to Intellectual Property Agreement]

Source: GARRETT MOTION INC., 8-K, 10/1/2018

Ex Output:
Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?


Ex Input:
EXHIBIT 99.2

e-business Hosting Agreement 1.0 Introduction This e-business Hosting Agreement (Agreement) between International Business Machines Corporation (IBM) and  The Quantum Group Inc., (Customer), sets forth the terms and conditions under which IBM will provide hosting and related services (Services) to Customer. The Agreement includes the terms and conditions and the documents referenced herein (Base Terms) and the following Attachments: Attachment A - Services; Attachment B - Hosting Components; and Attachment C - Charges In the event of a conflict between the Base Terms and an attachment listed herein (Attachment), the Base Terms will prevail, except where an Attachment, or a provision contained therein expressly states that it will prevail over the Base Terms. 2.0 Definitions Acceptable Use Policy means the Acceptable Use Policy for IBM e-business Services,  located on the Internet at www.ibm.com/services/e-business/aup.html, as of the Effective Date, and any subsequent modification in accordance with Section 13.2 below. Affiliates means entities that control, are controlled by, or are under common control with a party to this Agreement. Base Components means the hardware and software that IBM makes available, if any, as specified in Attachment B. Bandwidth means the measurement of samples of usage taken every five (5) minutes during a calendar month and collecting two (2) readings (cumulative of inbound feeds and cumulative of outbound feeds at the same measured point in time). The measurements are stored and become data points. At the end of the month, all data points taken during the month are ranked in ascending order. IBM will discard the top five percent (5%) for each set (inbound and outbound) of data points. The highest remaining sample of the two (2) sets becomes the Customer's Committed or Burstable usage number for that billing cycle. Burstable Bandwidth means the bandwidth consumption in excess of the Committed Bandwidth. Committed Bandwidth means the fixed circuit capacity that IBM will make available to Customer for connectivity to the Internet. Customer's data traffic between the e-business Hosting Center and the Internet may not exceed Committed Bandwidth, unless otherwise expressly specified in an Attachment. Content means information, software, and data that Customer provides, including, without limitation, any hypertext markup language files, scripts, programs, recordings, sound, music, graphics, images, applets or servlets that Customer or its Subcontractors or Services Recipients create, install, upload or transfer in or through the e-business Hosting Environment and/or Customer Components. Content Administrator means an employee or Subcontractor of Customer who is authorized by Customer to install, upload and/or maintain Content using a User Identification. Customer means IBM's Customer to whom the Services are being provided. Customer Components means the hardware, software and other products, data and Content that Customer provides, including those specified in Attachment B. Customer Initiated Changes means patches or changes to the environment dictated to be installed by Customer, and installed by either Customer or by IBM. Customer Production Ready Date or CPRD means the date (following the Hosting Service Ready Date) that the following items have been completed: (1) Customer has notified IBM that Customer has completed application testing and loading of Customer Content, and (2) IBM has notified Customer that monitoring and reporting have been enabled and end users may now begin using the Services. Commencing on the Customer Production Ready Date, Customer will not have administrative access for fully managed devices, unless specifically requested for a limited period of time mutually agreed between the parties, using the established change management procedures.

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Direct Access Storage or DAS means data storage devices that are directly attached to a server.

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Direct Access Storage or DAS means data storage devices that are directly attached to a server. e-business Hosting Environment means the Base Components and the IBM provided Internet access bandwidth, collectively. Hosting Service Ready Date means a date when IBM notifies Customer that Services are available for Customer use and IBM installation responsibilities have been completed for such Services. Services may be initiated in stages and monthly recurring charges will begin for any portion of Services specified in such notification. e-business Hosting Center means a facility used by IBM to provide Services. Internet means the public worldwide network of TCP/IP-based networks. Local Storage has the same definition as Direct Access Storage Logical Unit Number or LUN means the individual component in the SAN storage system that may be accessed. Each disk or disk partition in a SAN storage system array has a LUN assigned to it. Managed Application Service means a service provided by IBM that includes the Services defined in Attachment A as Managed Application Services. Managed Application Solution means a Customer's application hosting environment consisting of network, storage and server devices and includes Managed Application Services for all of the devices. A Managed Application Solution cannot contain any Managed Devices that do not also include Managed Applications Services in order to qualify for a Service Level Agreement as defined in Attachment A. Managed NAS Storage - Dedicated Environment means a physical NAS Storage controller and associated disks, provisioned by IBM or Customer that is dedicated to a Customer and managed by IBM. Managed NAS Storage - Shared Environment means a physical NAS Storage controller and associated disks, provisioned by IBM, that is shared between customers and managed by IBM. Resources are allocated by IBM based on requirements from the Customer and these resources are dedicated for the Customer's use. Managed SAN Storage - Dedicated Environment means a physical SAN Storage controller and associated disks that is dedicated to Customer (not shared with other IBM customers) and managed by IBM. Resources are allocated by IBM based on requirements from the Customer. Managed SAN Storage - Shared Environment means a physical SAN Storage controller and associated disks that is shared between two or more IBM customers and managed by IBM. Resources are allocated by IBM based on requirements from the Customer. Managed Server means a physical or Virtual Server Base Component for which IBM is providing setup, configuration, administration and management Services. Materials means literary or other works of authorship (such as programs, program listings, programming tools, documentation, reports, drawings and similar works) that IBM may deliver to Customer as part of Services.  Materials does not include licensed program products available under their own license agreements or Base Components. Middleware means any programming that serves to glue together or mediate between two separate and often already existing programs. A common application of middleware is to allow programs written for access to a particular database to access other databases. The systematic tying together of disparate applications, often through the use of middleware, is known as Application Integration. Network Interface Card (NIC) means a computer circuit board or card that is installed in a computer so that it can be connected to a network. Operational Assistance means the additional operational and physical assistance Services provided by IBM. Operational Events means the activities related to physical operations of an unmanaged Customer environment. These activities can include: Device reboot or restart Changing a tape Changing a CD or a disk floppy Preparing tapes for sending them offsite Vendor management for hardware repair or replacement

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Other types of events with the prior approval of the IBM PM Operating System or OS means the master control program (for example, Windows or AIX) that manages a computer's internal functions and provides a means of control to the computer's operations and file system. OS Image means the initial binary image that a boot loader loads into memory and transfers control to start an operating system. The OS image is typically an executable containing the operating system kernel. OS Instance means an occurrence of the OS Image. Ping means a utility to determine whether a specific IP address is accessible. Required Consents means any consents or approvals required to give IBM and its Subcontractors the right or license to access, use and/or modify in electronic form and in other forms, including derivative works, the Customer Components, without infringing the ownership or intellectual property rights of the providers, licensors, or owners of such Customer Components. Services Recipients means any entities or individuals receiving or using the Services, or the results or products of the Services. SmartHands means the additional systems administrative and technical, physical and logical assistance Services provided by IBM. mm. System Administration means day-to-day routine tasks performed in a production environment by a system administrator. This does not include, re-carving storage sub-systems, re-building enterprise class systems, major upgrades to the environment, major security services, database administration, application development, systems integration or extensive performance tuning responsibilities. Storage Area Network or SAN means the storage area network environment consisting of a storage area network fabric composed of storage area network switches, Host Bus Adapters and cables and a storage area network storage controller and associated disks. System Images means the files related to the OS and applications, but excluding Customer data files. Subcontractor means a contractor, vendor, agent, or consultant selected and retained by IBM or Customer, respectively. TCP/IP means Transmission Control Protocol/Internet Protocol. Time and Materials (T&M) means the additional operational, systems administrative and technical, physical and logical assistance Services provided by IBM that are not included with the services set forth in Attachment A - Services User Identification or User ID means a string of characters that uniquely identifies a Content Administrator. Virtual Local Area Network (VLAN) means a logical grouping of two or more devices which are not necessarily on the same physical network segment, but which share the same network segment. Virtual Private Network (VPN) means a private network that uses a public network (usually the Internet) to connect remote sites or users together. Virtual Server means an instance of a fully functional server residing with other instances on a physical server and isolated from other instances via virtualization software (such as VMWare) and shares the resources of the physical server.  The virtualization software provides resource management for all of the instances. 3.0 IBM Services Responsibilities IBM will perform the Services described in Attachment A and other applicable Attachments. IBM Contact IBM will designate an individual to whom Customer will address communications specific to the provision of the Services provided under this Agreement (IBM Contact). 4.0 Term and Termination Term This Agreement will be effective beginning on 12:01 a.m., Eastern Time, on the day after the date of last signature to these Base Terms (Effective Date). This Agreement will remain in effect for Thirty-six (36)

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months following the Hosting Service Ready Date (Term), unless terminated earlier in accordance with the terms herein. Termination for Cause Customer or IBM may terminate this Agreement for material breach of this Agreement by the other upon written notice containing the specific nature and dates of the material breach.  The breaching party will have thirty (30) days from receipt of notice to cure such breach, except for nonpayment by Customer, which must be cured within five (5) days from receipt of notice. If such breach has not been timely cured, then the non-breaching party may immediately terminate this Agreement upon written notice. Termination for Convenience Customer may terminate this Agreement, or any portion of Services specified herein, for convenience by: providing at least sixty (60) days prior written notice to IBM; and paying the applicable early termination charges specified in Attachment C. Effect of Termination Upon the date of termination, all Customer payment obligations accrued hereunder through the date of termination will become due and payable. 5.0 Charges and Payment Charges Customer will pay to IBM all applicable charges specified in Attachment C. Charges may be specified as one-time, recurring, or usage. IBM will invoice such charges when they begin or are due as set forth in Attachment C. Payment IBM invoices will specify the amount due. Payment is due and payable by month end for any invoice received by the 10th of the month, otherwise payment is due thirty (30) days from receipt of invoice. Customer agrees to pay accordingly, including any late payment fees. Payment will be made in United States dollars. Taxes Customer will pay or provide appropriate exemption documentation for all taxes, duties, levies, and any other fees (except for taxes based upon IBM's net income) related to the Services imposed by any governmental authorities. Charges specified herein are exclusive of any such taxes, duties, levies or fees. 6.0 Warranties and Disclaimers IBM Representations and Warranties IBM represents and warrants that: it will perform the Services using reasonable care and skill and in accordance with this Agreement; and it has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. Exclusivity of Warranties THE WARRANTIES IN SECTION 6.1 ARE THE EXCLUSIVE WARRANTIES FROM IBM.  THEY REPLACE ALL OTHER WARRANTIES, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, AND FITNESS FOR A PARTICULAR PURPOSE. Security Customer acknowledges that IBM offers numerous security options, and it is Customer's responsibility to select the set of security options that it determines meet Customer's needs. IBM will implement the security options specified herein. Customer acknowledges that IBM does not control the transfer of data over telecommunications facilities, including the Internet. IBM does not warrant secure operation of the Services or that it will be able to prevent third party disruptions of the e-business Hosting Environment or Customer Components. Customer agrees that IBM shall have no liability for any provision of security-related services or advice that IBM may voluntarily provide outside the scope of Services specified herein.

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Other Disclaimers

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Other Disclaimers IBM does not warrant uninterrupted or error-free operation of any Service or that IBM will correct all defects. IBM does not make any representation or warranty with respect to Customer's responsibilities set forth in Section 11.6. IBM provides Materials, non-IBM products, and non-IBM services  WITHOUT WARRANTIES OF ANY KIND.  However, non-IBM manufacturers, suppliers, or publishers may provide their own warranties to you. IBM does not operate as a provider of services regulated by the Federal Communications Commission (FCC) or state regulatory authorities (State Regulators), and does not intend to provide any services which are regulated by the FCC or State Regulators. If the FCC or any State Regulator imposes regulatory requirements or obligations on any Services provided by IBM hereunder, IBM may change the way in which such Services are provided to Customer to avoid the application of such requirements or obligations to IBM (e.g., by acting as Customer's agent for acquiring such Services from a third party common carrier). 7.0 Confidentiality All information exchanged between the parties is non-confidential.  If either or both parties require the exchange of confidential information, such information will be exchanged under the terms and conditions of a separate written confidentiality agreement. With respect to any confidential information contained in or traveling through the e-business Hosting Environment or Customer Components, as is contemplated herein, the provisions of Sections 6, 9, and 10 herein will prevail to the extent of any inconsistent provisions in the confidentiality agreement. 8.0 Indemnification Indemnification by IBM If a third party claims that Materials or Base Components IBM provides to Customer infringe that party's patent or copyright, IBM will defend the Customer and its employees, officers, and directors against that claim at IBM's expense and pay all costs, damages, and reasonable attorneys' fees that a court finally awards (or which IBM agrees in any final settlement), provided that Customer: promptly notifies IBM in writing of the claim; and allows IBM to control, and cooperates with IBM in, the defense and any related settlement negotiations. If such a claim is made or appears likely to be made, Customer agrees to permit IBM to enable Customer to continue to use the Materials or Base Components, or to modify them, or replace them with non-infringing Materials or Base Components that are at least functionally equivalent. If IBM determines that none of these alternatives is reasonably available, Customer agrees to return the Materials or Base Components (if in Customer's possession) to IBM on IBM's written request.  IBM will give Customer a credit equal to the amount Customer paid IBM for the applicable Materials or for use of the applicable Base Components up to a maximum of twelve (12) months of applicable charges. This is IBM's entire obligation to Customer with regard to any claim of infringement. Notwithstanding the foregoing, IBM is not responsible for third party claims based on: anything Customer provides which is incorporated into the Materials; Customer's modification of the Materials; the combination, operation, or use of the Materials with any product, data, or apparatus that IBM did not provide; or non-IBM hardware, software, or data, including those that may be in the Base Components. Indemnification by Customer Customer will defend IBM and its Affiliates and their employees, officers, and directors, at Customer's expense, and pay all costs, damages, and reasonable attorneys' fees that a court finally awards (or which Customer agrees in any final settlement) for any third party claim: that Content or Customer's use of the Services violates a Customer's obligation in Sections 11.3(b) or 11.5 (b); that Customer Components infringe that party's patent or copyright; that is brought by a Services Recipient and is related, directly or indirectly, to the Services; or

Page 5 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





arising out of or related to a mechanics' lien Customer is required to cancel and discharge pursuant to this Agreement. For indemnification under this Section 8.2, IBM will: promptly notify Customer in writing of the claim; and allow Customer to control, and will cooperate with Customer in, the defense and any related settlement negotiations. 9.0 Limitation of IBM's Liability Circumstances may arise where, because of a default on IBM's part or other liability, Customer is entitled to recover damages from IBM. Regardless of the basis on which Customer is entitled to claim damages from IBM (including fundamental breach, negligence, misrepresentation, or other contract or tort claim), IBM is liable for no more than: indemnification payments as provided in Section 8.1; damages for bodily injury (including death) and damage to real property and tangible personal property; and the amount of any other actual direct damages, up to the greater of $100,000 or the charges paid by Customer to IBM for the Services in the twelve (12) months immediately preceding the accrual of the first claim related to the Services. The foregoing limit also applies to any of IBM's Affiliates and Subcontractors.  It is the cumulative maximum for which IBM and its Affiliates and Subcontractors are collectively responsible. Under no circumstances is IBM, its Affiliates or its Subcontractors liable for any of the following: third party claims against Customer for damages (other than those expressly provided in Subsections 9.0(a) and 9.0(b)); or loss of, or damage to, Customer's or any other entity's records or data. 10.0 Disclaimer of Consequential Damages In no event will either party be liable to the other for special, incidental, or indirect damages or for any consequential damages (including lost profits or savings), even if they are informed of the possibility; provided that this Section 10.0 does not apply to Customer's failure to pay any amounts owing to IBM under this Agreement (including amounts owing for Services that would have been rendered but for Customer's breach of this Agreement).  11.0 Other Customer Obligations Customer Contact Customer will designate an individual to whom all of IBM's communications will be addressed and who has the authority to act and make decisions for Customer in all aspects of the Services, including requesting changes, problem resolution, Service requests, assignment of Customer focal points with authority over specific Services, and designation of Customer Authorized Representatives (Customer Contact). Services Support Customer will comply with its responsibilities to support the Services as specified in applicable Attachments. Such obligations are to be performed at no charge to IBM. IBM's obligations are contingent on Customer meeting such support obligations. Representations and Warranties Customer represents and warrants that: it has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement; Customer has no contractual or other obligation that (i) restricts or prohibits Customer's execution or performance of this Agreement, or (ii) Customer will breach in connection with the execution or performance of this Agreement; and its use of the Services and all Content will comply with the Acceptable Use Policy. Suspected Violations IBM reserves the right to investigate potential violations of the representations and warranties in Subsection 11.3(b). If IBM reasonably determines that a breach of any such warranty has occurred, then IBM may, in its sole discretion: restrict Customer's access to the Services;

Page 6 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





remove or require removal of any offending Content; terminate this Agreement for cause; and/or exercise other rights and remedies, at law or in equity. Except in an emergency or as may otherwise be required by law, before undertaking the activities in Subsection 11.4(a) or 11.4(b), IBM will attempt to notify Customer by any reasonably practical means under the circumstances, such as, without limitation, by telephone or e-mail. Customer will promptly notify IBM of any event or circumstance related to this Agreement, Customer's use of the Services, or Content of which Customer becomes aware that could lead to a claim or demand against IBM and Customer will provide all relevant information relating to such event or circumstance to IBM at IBM's request. Customer Components Customer (or its Affiliates or third parties) retains all right, title, and interest or license in and to the Customer Components. Customer hereby grants to IBM, its Affiliates and Subcontractors all rights and licenses to, or agrees to promptly obtain and keep in effect Required Consents for all Customer Components, necessary for IBM to perform all of its obligations as set forth in this Agreement. Upon request, Customer will provide to IBM evidence of any such rights, licenses, or Required Consents.  IBM will be relieved of its obligations to the extent that they are affected by Customer's failure to promptly obtain and provide to IBM any such rights, licenses, or Required Consents. IBM will adhere to reasonable terms and conditions pertaining to Customer Components as notified in writing to IBM. IBM agrees not to remove or alter any copyright or other proprietary notice on or in any Customer Component without Customer's consent. Capacity Planning Customer acknowledges it is its responsibility to determine whether the Services, e-business Hosting Environment, Customer Components and their combination will meet Customer's capacity, performance, or scalability needs.  Customer is responsible for planning for and requesting changes to the e-business Hosting Environment, including any additional capacity required to support anticipated peaks in demand that may significantly increase web site hits, transaction volumes, or otherwise increase system resource utilization. Content Customer is solely responsible for: all Content including, without limitation, its selection, creation, encryption, transmission, transfer, design, licensing, installation, accuracy, maintenance, testing, backup and support; all copyright, patent and trademark clearances in all applicable jurisdictions and usage agreements for any and all Content; the selection and implementation of controls on the access and use of Content; and the selection, management, separate storage of keys, and use of any public and private keys and digital certificates it may use with the Services. 12.0 Other License and Rights License for Base Components IBM (or its Affiliates or subcontractors) retains all right, title, and interest in Base Components. IBM grants Customer a nonexclusive, nontransferable, revocable license to access and use the Base Components solely in connection with the Services as provided under this Agreement. Customer agrees not to download or otherwise copy, reverse assemble, reverse compile, decompile, or otherwise translate the software portions of the Base Components, other than to make one copy for backup purposes. If IBM provides as a Base Component a Microsoft Corporation product, the terms and conditions of the Microsoft Customer License Terms will also apply for such products.  Such Terms are located on the Internet at http://www.ibm.com/services/e-business/hosting/microsoftlicense.html. Customer agrees not to remove or alter any copyright or other proprietary notice on or in any Base Component without IBM's consent.

Page 7 of 36

No Sale or Lease of Goods

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





No Sale or Lease of Goods As between Customer and IBM, IBM retains all right, title and interest in the Base Components. No goods are sold or leased by IBM under this Agreement. If Customer desires to purchase or lease goods from IBM, such purchase or lease will be governed by a separate mutually acceptable written agreement between Customer and IBM or an IBM Affiliate. No Lease of Real Property This Agreement is a services agreement and not a lease of any real property. 13.0 Changes Service Description IBM, in its reasonable discretion, may change the terms and conditions of Attachment A upon at least ninety (90) days prior notice to Customer if such change was the result of: law, regulation, or similar governmental action; a ruling by a court of competent jurisdiction; or changes in the method of service delivery that affect similar IBM e-business hosting customers. Changes as a result of a, b, or c above will be effective on the date IBM specifies in the notice. Acceptable Use Policy IBM, in its reasonable discretion, may modify the Acceptable Use Policy upon thirty (30) days' prior notice to Customer.  If such modification has a material adverse effect on the Customer's use of the Services and provided such modification is not required by law, regulation, or similar governmental action, or a ruling by a court of competent jurisdiction, Customer's sole remedy is to terminate this Agreement without the payment of termination charges provided Customer gives IBM notice of its intent to terminate within ninety (90) days of the effective date of such modification. Project Change Control Procedure This Agreement may be amended only by a writing signed by authorized representatives of both parties. Requests for such amendment (Project Change Request or PCR) should be submitted in writing by the requesting party. The PCR should reference this Agreement, describe in a reasonable level of detail the proposed change, the rationale for the change, and the impact the proposed change may have on the Agreement. The parties will review the PCR and will do one of the following: authorize the change by signing the PCR; agree in writing to submit the PCR for further investigation. In such case, Customer agrees to pay IBM for its reasonable charges, if any, for such investigation. The investigation will determine the technical merits and the effect on the charges, schedule, and other terms and conditions that may result from the implementation of the PCR. The parties will then decide either to accept or to reject the PCR; or reject the PCR. If the PCR is rejected, the rejecting party will inform the requesting party of the reason for the rejection. A mutually signed PCR will be deemed an amendment to this Agreement. Any modification of this Agreement requested by Customer as a result of laws applicable to Customer will be considered a PCR covered by this Subsection. Until a change is agreed in writing, both parties will continue to act in accordance with the latest agreed version of the Agreement. 14.0 General Headings The headings of the various sections of this Agreement have been inserted for convenience only and shall not affect the interpretation of this Agreement. Survival Any of these terms and conditions which by their nature extend beyond the Agreement termination or expiration remain in effect until fulfilled, including, without limitation, Sections 4.4, 5, 6, 7, 8, 9, 10, 11.3, 11.4, 11.7, 12.2, 12.3, and 14, and apply to both Customer's and IBM's respective successors and assignees.

Page 8 of 36

Choice of Law

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Choice of Law This Agreement will be governed by the substantive laws of the State of New York, without regard for its conflict of laws provisions. Waiver of Jury Trial The parties waive any right to a jury trial in any proceeding arising out of or related to this Agreement. Severability If any provision of this Agreement shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions of this Agreement shall in no way be affected or impaired thereby, so long as the remaining provisions of this Agreement still express the original intent of the parties.  If the original intent of the parties can not be preserved, this Agreement shall either be renegotiated or terminated. Publicity and Trademarks Neither party grants the other the right to use its or any of its Affiliates' trademarks, trade names, or other designations in any promotion, publication, or Web site without prior written consent. Except as may be required by law or as may be required by IBM to perform the Services, neither party may disclose to any third party the terms and conditions of this Agreement, without prior written consent. No Third-Party Beneficiaries Except as expressly provided in Section 8, this Agreement does not create any intended third party beneficiary rights. Personnel Each party is responsible for the supervision, direction, and control of its respective personnel. IBM reserves the right to determine the assignment of its personnel. IBM may subcontract portions of the Services to Subcontractors and Affiliates selected by IBM. No Agency This Agreement does not create an agency, joint venture, or partnership between the parties. Assignment Neither party may assign this Agreement, in whole or in part, without the prior written consent of the other. Any attempt to do so is void. Neither party will unreasonably withhold such consent. The assignment of this Agreement, in whole or in part, to any Affiliates in the United States or to a successor organization by merger or acquisition does not require the consent of the other. IBM is also permitted to assign its rights to payments under this Agreement without obtaining Customer's consent. It is not considered an assignment for IBM to divest a portion of its business in a manner that similarly affects all of its customers. No Resale Customer shall not resell the Services, in whole or in part.  This does not prevent Customer from making their Content available to Customer's end users. Risk of Loss Risk of loss for all Base Components shall at all times remain with IBM. Risk of loss for all Customer Components shall at all times remain with Customer. Force Majeure Except for payment obligations hereunder, neither party is responsible to fulfill its obligations to the extent due to causes beyond its control. Actions Period Neither party will bring a legal action related to this Agreement more than two years after the cause of action accrued.

Page 9 of 36

Waiver

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Waiver The failure of one party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver, nor shall it deprive that party of the right to insist later on adherence thereto. Any waiver must be in writing and signed by an authorized representative of the waiving party. Freedom of Action Each party is free to enter into similar agreements with others. Limitation of Licenses Each of us grants only the licenses or rights expressly specified herein. No other licenses or rights (including licenses or rights under patents) are granted, either directly, by implication, estoppel, or otherwise. Materials For Materials that IBM delivers to Customer that are created during the performance of Services or otherwise (such as those that preexist the Services), IBM or third parties have all right, title, and interest (including ownership of copyright). IBM will deliver one copy of the Materials to Customer. IBM grants Customer an irrevocable, nonexclusive, worldwide, paid-up license to use, execute, reproduce, display, and perform copies of such Materials and distribute within Customer's Affiliates only.  Customer agrees to reproduce the copyright notice and any other legend of ownership on any copies made. Business Contact Information Customer agrees to allow IBM and its Affiliates to store and use Customer's business contact information, including names, business phone numbers, and business e-mail addresses, anywhere they do business. Such information will be processed and used in connection with our business relationship, and may be provided to contractors acting on IBM's behalf, IBM business partners who promote, market, and support certain IBM products and services, and assignees of IBM and it's Affiliates for uses consistent with our business relationship. Data Protection For personal information processed by IBM on Customer's behalf as part of the Services, IBM will act in accordance with Customer's instructions by following such processing and security obligations as are contained in this Agreement. Customer also confirms that Customer is solely responsible for ensuring that any processing and security obligations comply with applicable data protection laws. Customer's contact information shall not be considered personal information processed on Customer's behalf. Geographic Scope The parties agree that while Services Recipients outside of the United States of America may access the Services, Customer's rights and IBM's obligations arising out of the Agreement are valid only in the United States of America. Notices Any notices required or permitted hereunder will be effective upon receipt and will be personally delivered; mailed via the postal service; sent by reliable overnight courier; or transmitted by confirmed facsimile. Except for notices under Section 11.4, all notices will be in writing and addressed to the applicable party's designated representative at the address specified in this Agreement.  Except as to notices permitted or required under Sections 4 or 8, the parties agree that electronic mail messages sent between them using security procedures sufficient to reasonably authenticate them will be deemed writings. In addition, IBM may provide notice under Section 13.2 by a posting to the Web site identified in Section 2.0 (a).

Page 10 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





___________________________________________________________________________________ In entering into this Agreement, Customer is not relying upon any representation made by or on behalf of IBM that is not specified in the Agreement, including without limitation, the charges to be paid or the results of any of the Services to be provided under this Agreement. By signing below, Customer and IBM agree that this Agreement, including these Base Terms and Attachments, is the complete agreement between the parties relating to this subject matter. Once signed, 1) any reproduction of this Agreement or an Attachment made by reliable means (for example, photocopy or facsimile) is considered an original and 2) all Services ordered under this Agreement are subject to it.

After signing, please return a copy of this Agreement to the IBM or partner sales representative listed above.

Page 11 of 36

Attachment A - Services

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Attachment A - Services 1.0 Description IBM will provide a hosting infrastructure and related services in an e-business Hosting Center as described herein (Managed Hosting Services).  IBM shall have sole root access (privileged access with authority to perform system-level functions or security administration) for all Base Components, except for partially managed servers (Partially Managed Servers) specified in Attachment B. IBM's scheduled maintenance hours for the e-business Hosting Center are each Sunday between 3:00 a.m. and 6:00 a.m. local time. Managed Hosting Services may not be available during this time.  IBM reserves the right to interrupt Managed Hosting Services to perform emergency maintenance as needed.  In any such circumstances, IBM will use commercially reasonable measures to notify Customer. Scheduled maintenance hours may change upon notice. 2.0 Base Component Software IBM will provide the following Base Component software: Base Component software selected by IBM for server monitoring and management; Base Component software selected by IBM for antivirus scanning of Windows 2003 servers; Base Component software selected by IBM to enable backup and restoration Services; and Base Component software specified in Attachment B. Upon expiration or termination of this Attachment, Customer will certify in writing to IBM that all use of software Base Components by Customer has ceased and that Customer has retained no copy of such software. 3.0 Customer Components Customer will provide Customer Components identified in Attachment B, subject to the following provisions: the provision for and expense of installation and maintenance for Customer Components is the responsibility of Customer.  Upon Customer's request, IBM will schedule maintenance, notify Customer of the schedule, provide access to the e-business Hosting Center for Customer's authorized maintenance vendors as required, and escort authorized maintenance personnel while on premises at an e- business Hosting Center; Customer is responsible for obtaining and maintaining personal property insurance sufficient to cover the value of Customer Components; Customer is responsible for any shipping or temporary storage costs incurred during the delivery of Customer Components to the e- business Hosting Center or removal of Customer Components from the e-business Hosting Center, unless otherwise expressly set forth in an Attachment; Customer is responsible for authorizing its Content Administrators to access and modify Content by providing User Identifications to such Content Administrators and for the control and distribution of User Identifications and any misuse of such User Identifications; and on or before five (5) days following expiration or termination of this Attachment, Customer will erase Customer Components from any servers and disk space that IBM provides as Base Components. On or before fifteen (15) days following expiration or termination of this Attachment, Customer will remove all Customer Components and any other Customer property from the e-business Hosting Center (excluding any Base Components and other IBM property). If Customer does not remove or erase Customer Components and its other property within such periods, IBM has the option to: move any and all Customer Components and other Customer property to storage and charge Customer all associated costs; liquidate Customer Components and other Customer property in any reasonable manner and charge Customer all associated costs; and erase all Customer Components from servers and disk space that IBM provides as Base Components. 4.0 Services Provided by IBM IP Address Services IBM will provide the number of registered primary IP addresses specified in Attachment B.

Page 12 of 36

Transition Management

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Transition Management IBM will assign a transition manager to manage and oversee the installation and integration of Base and/or Customer Components specified in Attachment B and prepare for ongoing operation. The project manager will: participate in a pre-boarding call with Customer to review Customer's hosting environment and identify information needed for installation; report installation status to Customer; schedule and conduct a boarding call with Customer to confirm that installation of Customer's hosting environment is complete and that it is ready for use (Hosting Service Ready Date); and be available to assist Customer with questions and issues during normal business hours for the e-business Hosting Center (Monday through Friday, 8:00 a.m. - 6:00 p.m., excluding national holidays). Steady State Support IBM will assign a project manager who will be a single point of contact during the ongoing provision of Services to assist Customer with implementation of additional Services and resolution of problems. The account support representative will: notify Customer of planned or emergency e-business Hosting Center maintenance; assist with change requests; and be available to assist Customer with questions and issues during normal business hours for the e-business Hosting Center (Monday through Friday, 8:00 a.m. - 6:00 p.m., excluding national holidays). Management Segment IBM will provide a local area network connection that will enable IBM to manage Base and/or Customer Components and provide other Services at the e-business Hosting Center.  IBM will implement a VLAN and any routing and switching configuration within the IBM hosting infrastructure that is needed to support a management segment. 4.4.1 Backup Segment IBM will provide a Gigabit local area network connection that will enable IBM to manage the backup of the System Images and will also provide a SAN connection to manage the backup of Customer data. IBM will implement a Backup VLAN and any routing and switching configuration within the IBM hosting infrastructure that is needed to support a backup segment. Internet Connectivity IBM will provide a primary connection between the e-business Hosting Center and the Internet with Internet Committed Bandwidth in increments of one (1) Mbps as selected by Customer and specified in Attachment B. Customer will provision and manage all SSL certificates. IBM will assign private IP addresses for Customer's servers at the e-business Hosting Center. Customer is responsible for working with IBM during the technical discovery phase to ensure that these IP addresses do not pose any conflicts with Customer's existing IP addressing schema. During the term IBM shall not change the public IP address(s) assigned to the Customer without the Customer's prior written consent. Customer's data traffic between the IBM e-business Hosting Center and the Internet may exceed Committed Bandwidth, if capacity is available from the IBM e-business Hosting Center network infrastructure. Each calendar month, IBM will measure Customer's actual bandwidth usage by sampling the inbound and outbound data traffic volume between the IBM e-business Hosting Center and the Internet every five (5) minutes. At the end of the month, IBM will discard the five percent (5%) of the samples with the highest data traffic volume. Customer's Peak Bandwidth Usage for that month is the remaining sample with the highest data traffic volume.  If Customer's Peak Bandwidth Usage for the month exceeds Committed Bandwidth, Customer will incur a Peak Bandwidth Usage charge, for the amount of usage that exceeds Committed Bandwidth, at the rate specified in Attachment C. In addition, IBM will provide access to bandwidth utilization reports through a Customer accessible web portal.

Page 13 of 36

Managed Switch, Firewall and Load Balancing

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Managed Switch, Firewall and Load Balancing IBM will provide the installation and ongoing management of switch, firewall and Load balancing components specified in Attachment B. IBM will: Install the switch and firewall components defined in Attachment B, implement switch and firewall settings requested by Customer, and test one (1) path to each Network Interface Card (including secondary) in each component; Operate and provide support for all switch and firewall components requested in the Attachment B and monitor their availability 7x24 every day of the year; Provide on-call technical support 7x24 every day of the year for switch and firewall components that may include: Assistance with problem determination; Reboot/power-on of failed switch and firewall components and provide Customer notification; and Implementation of changes to switch and firewall settings requested by Customer. Back up of Customer-requested switch and firewall settings and the restoration of settings in the event of a failure; Provide Customer daily status of firewalls via a Customer accessible IBM web portal; Provide Customer daily status of their network via the Customer accessible IBM web portal; IBM will assign private IP addresses in the range of 10.200.x.x for the private network for component servers at the Hosting Facility. Customer is responsible for working with IBM during the technical due diligence period to ensure that these IP addresses do not pose any conflicts with Customer's existing IP addressing schema; In case of a conflict, Customer will provide network address translation (NATing) for the IP addresses in conflict; and The IPSec tunnels for the VPNs will be based on IPSEC 3-DES technology. Support the following load balancing techniques.  The actual technique to be used for Customer will be determined during implementation and documented in the operations run book maintained by IBM. Round Robin (default load balancing technique) Connections are distributed evenly across all members in the pool. Ratio Member - Connections are sent to a member with a high ratio number more often than a member with a lower ratio number. Node Address - The total number of connections sent to a member in the pool is determined by the weight number you assign the node address. Least Connections Member - Connections are sent to the member with the least active connections. Node Address - Connections are sent to the node serving the least amount of connections. Observed 10. Member - Connections are sent to a member based on a combination of the number of current connections and the response time of the member. The Load Balancer analyzes the performance of the member over time and sends connections to the member based on the trend. 11. Node Address - Connections are sent to a node based on a combination of thenumber of current connections and the response time of the node. The Load Balancer analyzes the performance of the nodes over time and sends connections to the node based on the trend. 12. Predictive 13. Member - Connections are sent to a member based on a combination of the number of current connections and the response time of the member over time. 14. Node Address - Connections are sent to a node based on a combination of the number of current connections and the response time of the node over time. 15. Fastest Node Address - Connections are sent to the node that responds most quickly.

Page 14 of 36

Security Management

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Security Management The security management specified in this section are included as part of the switch & firewall Services specified above. IBM will: be responsible for day-to-day logical security management for the firewall(s), switches and servers dedicated to Customer's e-business Hosting Environment; assist in logically connecting (at OSI Layer 3) Customer networks to the IBM managed networks only when the connection is specifically identified and agreed to in advance by both parties in writing; implement and administer technical and procedural controls to prevent unauthorized, logical access; report incidents of security breach or suspected security breach to Customer; replace software vendor-supplied default password settings with unique secure passwords; implement network intrusion detection/event logging mechanisms; host based intrusion for an additional fee, if requested by Customer; perform regular vulnerability scans of installed Base Component software for: known/reported component vulnerabilities available security patches/fixes; includes firewall and all IP enabled devices in the network both inside as well as outside the firewall; scan external connections to the customer's environment; scan the internal connections to the customer's servers; scan the connection to the Supplier management and backup segments; update list of common vulnerability signatures weekly; update list of security patches by device and OS weekly; perform weekly scans of all IP enabled devices; 10. post weekly exception reports to the customer accessible web portal; 11. recommend corrective action; 12. notify Customer of all critical vulnerability discovered during the scan; 13. notify Customer of all repeat vulnerability that have not been corrected or acknowledged by the Customer; 14. Outages caused by Customer not approving Supplier recommended vulnerability fixes will not be eligible for SLAs. 15. Known/reported component vulnerabilities; and 16. Install available security patches/fixes at the earliest opportunity afforded by the change control process; install available security patches/fixes using the change control process, as approved by the Customer in writing; establish rules for password selection and control, for example: passwords must be robust and not incremental, easily discerned, and changed on regular intervals such as 90 days; user ids / passwords should be disabled after a predefined number of unsuccessful access attempts or after a period of prolonged inactivity; if supported by the operating system/applications, the software should enforce password syntax and change interval; define and implement clear procedures for detecting, recording and reporting security incidents and issues. Fully Managed Servers IBM will provide installation and ongoing management of server Base and/or Customer Components specified (as Fully Managed Servers) in Attachment B, 24x7 everyday of the year. Following installation and prior to IBM beginning ongoing management, Customer may request root access for a limited period of time, solely for the purpose of loading and configuring Customer Content. It is required that the Customer

Page 15 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





will not modify or change any of the administrative areas (for example, UNIX /, /etc, /bin, /usr/sbin, or /var) without written consent from IBM.  IBM will not begin ongoing server management until Customer returns sole root access to IBM and IBM verifies that the environment is stable and supportable. IBM will: Install the Managed Servers requested in a Attachment B including infrastructure related software object modules consisting of a predefined combination of operating system, applicable fixes, selected security / virus patches for Windows based systems, management tools and agents; Test network connectivity paths to server components requested in a Attachment B; Perform the operations events and predefined actions for Managed Servers requested in a Attachment B; Provide technical support, including problem determination, for the device hardware and OS.  IBM will install agents to monitor and report on only the following: Network Interface Up/Down Physical Memory Utilization Processor Utilization - Overall Disk Space Utilization OS services and/or daemons Provide routine Server Administration for the Managed Servers requested in the applicable Attachment A; Perform one (1) weekly full and six (6) daily incremental backups of System Images during the Scheduled Maintenance window unless otherwise set forth in the applicable Attachment A. The System Images will capture the information necessary to be able to perform a successful single step bare metal restore. Provide retention in the IBM library for weekly full backup of System Images for a period of fourteen (14) calendar days unless otherwise set forth in the applicable Attachment B; Restore System Images at no additional charge up to two (2) times per month per Managed Server per Customer. This excludes bare metal restores. Bare metal restores may be performed for an additional charge using SmartHands rates. Provide offsite storage for weekly backup of System Images. Such backups shall be sent offsite once a week and be retained offsite for a period of twenty-eight (28) calendar days unless otherwise set forth in the applicable Attachment B; Provide daily status of the state of the Customer environment using a Customer accessible IBM web portal; Provide details and a monthly summary of the thresholds being monitored using a Customer accessible IBM web portal; Provide details and a monthly summary of the utilization of Managed Server components such as CPU, memory and disk. Reports will be provided using the Customer accessible IBM web portal; Provide details of trouble tickets and their status and action taken to resolve the trouble ticket using a Customer accessible IBM web portal; Identify maintenance releases for supported O/S technologies outlined in Attachment D (Supported Technologies) and provide assessment and notification to Customer; Apply OS maintenance releases that are approved by IBM; Identify security patches/hotfixes for supported O/S technologies outlined in Attachment D (Supported Technologies) and, for critical patches, provide assessment and notification to Customer and the IBM PE and IBM PM within seventy-two (72) hours of release from vendor; Apply patches to the OS that are approved by IBM or Customer; and Provide device availability statistics for Managed Servers using a Customer accessible IBM web portal. In addition, the following will apply for Managed Servers: When IBM owns administrative rights, then following installation and prior to IBM beginning ongoing management, Customer may request root access for a limited period of time, solely for the purpose of loading and configuring Customer Content. It is required that the Customer will not modify or change any of the administrative rights (e.g. Linux /, /etc, /bin, /usr/sbin, /var, etc; Microsoft Local Administrator Accounts/Groups, user right assignments, System File/Directory permissions, etc) without written

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Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





consent from IBM. IBM will not begin ongoing server management until Customer returns sole root access to IBM and IBM verifies that the environment is stable and supportable. When IBM owns administrative rights, Customer may request temporary administrative rights in writing during ongoing management. It is required that the Customer will not modify or change any of the administrative rights (e.g. Linux /, /etc, /bin, /usr/sbin, /var, etc; Microsoft Local Administrator Accounts/Groups, user right assignments, System File/Directory permissions, etc) without written consent from IBM. During this period the SLA will be suspended. If Customer chooses to own administrative rights, SLAs for those Managed Servers will be suspended for the term of the Attachment B. IBM may request temporary administrative rights to deploy patches and other administrative tasks. Although there are no limitations on the number of change requests, the number of emergency requests will be limited to three (3) requests per month, per Customer at no additional charge. Additional requests shall be at the SmartHands rate. Customer must test their applications and approve the IBM applying maintenance releases for their OS such that the environment is always within two maintenance releases. All SLAs will be suspended and service will be provided on a best effort basis for any environment that does not comply with this requirement. IBM will support the current release (N) and the release immediately preceding the current release (N-1) of the operating system software. IBM and IBM will work jointly to determine when operating system and micro code upgrades and fixes are applied. IBM will not: Setup and maintain Customer end users; Install, maintain or support Customer applications; Provide application troubleshooting services unless Managed Application Service or T&M services have been purchased; Perform logical database administration; and Perform backups of Customer Content. Such backups are provided as part of the Storage Services as outlined in this Attachment A. Monitoring of Fully Managed Servers IBM will install software components to enable monitoring of the Base and/or Customer Components specified in Attachment B. On a 24x7 everyday of the year basis, IBM will: monitor all Network Interface Cards (NIC); monitor selected operating system thresholds, logs and processes; respond to exceptions and alerts. IBM will execute any internal Standard Operating Procedures (SOP) or a reasonable SOP provided by Customer. Additionally, IBM will make the initial determination as to whether the issue falls within the operational/system/network area or is an application issue; determine if there are patches available for the OS; apply patches to the OS that are approved by IBM in writing; Make the initial determination as to whether the issue falls within the Operational/System/Network area; Immediately notify the Customer of Severity 1 and 2 incidents; monitor for hardware predictive failure analysis alerts when using IBM servers; and notify Customer in writing when Customer intervention or decisions are required. Customer may request, in writing, the granting of temporary administrative rights after the Customer environment has been turned over to IBM for monitoring. IBM will not monitor the affected components while Customer has administrative rights and any SLA provisions will be suspended during this period. IBM will provide Customer with information on the web portal that show monitoring statistics that include daily and historical information (maintained for a one (1) month period). These reports will include the utilization of the components included in the threshold monitoring, such as CPU, memory and disk. Monitoring of the Base and/or Customer Components with associated alerts will not be activated from IBM's production monitoring systems until the Customer Production Ready Date. Customer shall not be

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eligible for an Availability Credit until the first full calendar month following the Customer Production Ready Date.  Basic Monitoring Services (Ping Monitoring) IBM will provide basic Ping monitoring of the Base and/or Customer Components on a 24x7 everyday of the year basis. IBM will provide installation and ongoing monitoring for server and non-server partially managed, monitored Base and/or Customer Components. Customer will own administrative rights for the devices to be monitored. However, IBM may request and will be granted temporary administrative rights in order to install, setup, or maintain any agents required to perform the monitoring. IBM reserves the right to adjust the thresholds for any monitored event in order to reduce the instances of false positives. Customer will be notified in of the change. IBM reserves the right to take a basic monitored server offline if it is deemed by IBM to be a security risk for the rest of the IBM environment. IBM will inform the Customer, the IBM PE and the IBM PM of such action. IBM will: Monitor all network interface cards (NIC); Request the temporary root access privilege from Customer if required Provide Customer with a user ID and password to a secure portal for viewing of real-time monitoring status and alert history; Send an administrative alert via electronic mail to a customer-supplied address if a NIC fails to respond to a Ping; Notify Customer in writing when Customer intervention or decisions are required. Maintain and monitor systems used to provide monitoring; Test and apply patches to monitoring systems as needed; and Provide monitoring statistics on the IBM Web portal. IBM will not: Respond to exceptions and alerts; Monitor any hardware, application, database, network, or operating system components other than those specified above; Provide third-party monitoring agents; and Provide any reporting either in hard-copy or electronic form other than what is available through the Customer portal. Monitoring of the Base and/or Customer Components with associated alerts will not be activated from IBM's production monitoring systems until the Customer's Customer Production Ready Date. Customer shall not be eligible for an Availability Credit until the first full calendar month following the Customer Production Ready Date. In addition, the following will apply for Basic Monitoring Services: Following the initial installation, Customer will be given root access to the Base Components; IBM will provide space, power and cooling for the Base and/or Customer Components; IBM will include up to five (5) Operational Events per month; Customer Content backup is not included in the base offering and can be provided at an additional cost; Customer System Image backup is not included in the base offering and can be provided at an additional cost; System Administration is not included in the base offering; Patch management is not included in the base offering; The status of all server Base and/or Customer Components based solely on the ping monitoring of the network interface cards will be shown on the web portal and the customer will also be notified; and IBM will issue the ping command for each server base component at least every fifteen (15) minutes. Advanced Monitoring Services IBM will provide 24x7 advanced device monitoring of the server and non-server Base and/or Customer Components. Customer will own administrative rights for the devices to be monitored. However, IBM may request and will be granted temporary administrative rights in order to install, setup, or maintain native SNMP agents as required to perform the monitoring. IBM reserves the right to adjust the thresholds for any monitored event in order to reduce the instances of false positives. Customer will be notified in of the change.

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IBM will: Monitor all network interface cards (NIC); Monitor the following operating system metrics: CPU utilization; Memory and Swap utilization; Disk and filesystem utilization; Monitor for hardware predictive failure analysis alerts when using IBM servers; Define and set thresholds for all monitored events based on industry standard best practices; Provide Customer with a user ID and password to a secure portal for viewing of real-time monitoring status and alert history; Send an administrative alert via electronic mail to a customer-supplied address for all events that exceed the maximum allowable threshold; Notify Customer in writing when Customer intervention or decisions are required. Maintain and monitor systems used to provide monitoring; Test and apply patches to monitoring systems as needed IBM will not: Respond to exceptions and alerts; Monitor any application, database, network, or operating system components other than those specified above; Provide third-party monitoring agents; Provide any reporting either in hard-copy or electronic form other than what is available through the Customer portal. IBM will provide Customer with information on the IBM Web portal that show monitoring statistics that include daily and historical information (maintained for additional one (1) month period). These reports will include the utilization of the components included in the threshold monitoring, such as CPU, Memory and Disk. This historical information may optionally, for an additional fee, include one year of history. The reports for iSeries may be different from those available for other platforms. Monitoring of the Base and/or Customer Components with associated alerts will not be activated from IBM's production monitoring systems until the Customer's Customer Production Ready Date. Customer shall not be eligible for an Availability Credit until the first full calendar month following the Customer Production Ready Date. Virtual Servers for Microsoft Windows and Linux OS Customer environment can consist of virtual as well as physical devices. For Virtual Servers, IBM will provide the following Services: Services defined under Managed Servers in Section 4.8 (Fully Managed Servers; Physical servers needed to operate a virtual server farm; All licenses for virtualization software and management tools (e.g. VMware ESX3.0; VMotion and others as needed); Capacity management for the physical server farm to ensure each virtual server has resources required for operation as specified in Attachment B; Restart virtual machine in the event of a virtual or physical machine failure; and Include twenty (20) GB of virtual disk for OS and application code for each Virtual Server. Storage Services - Managed SAN Fabric IBM will provide installation, configuration, ongoing system administration and management support services for the SAN Fabric Base and/or Customer Components (SAN Fabric) identified in Attachment B at the e-business Hosting Center.  IBM will zone the SAN switches as necessary for security. IBM retains sole root/administrative access (privileged access with authority to perform system-level functions or security administration) in order to perform installation and ongoing management services for the SAN Fabric. The following items apply to the SAN Fabric:

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The managed servers will be connected to the SAN Storage via multiple connections to the SAN switches using two or more HBAs for redundancy in each server, as described for each server in Attachment B. The storage backup media server will be connected to the SAN Storage via redundant connections to the SAN switches using two or more HBAs in each server. In the event that additional SAN switches are required, Customer will sign a new PCR for the additional SAN switches. Managed SAN Storage - Shared Environment IBM will provide installation and ongoing system administration and management support services for the shared SAN storage device components specified in Attachment B. Disk space will be allocated by IBM based upon Customer provided specifications from a common pool of SAN storage. SAN switches with zoning dedicated to a Customer and dedicated LUNs will be used to securely implement individual data storage requirements. Managed SAN storage applies only to Customer data storage and excludes System Images. Customer will be responsible for populating the files and databases and for all Customer Content. IBM retains sole root/administrative access (privileged access with authority to perform system-level functions or security administration) in order to perform installation and ongoing management services for SAN storage. The following items apply to the SAN storage shared environment: managed servers will be connected to the SAN storage via redundant connections to different SAN switches using two (2) or more HBAs in each server; the storage backup media server will be connected to the SAN Storage via redundant connections to the SAN switches using two or more HBAs in each server; and if additional SAN Storage capacity is required, Customer will sign a project change request for additional SAN capacity.

Virtual Private Network IBM will configure and manage the number of VPNs identified in Attachment B. The VPNs will consist of an IPSec tunnel based on 3- DES Shaw technology in the firewall at the e-business Hosting Center. IBM will configure and manage the VPN tunnel at the e-business Hosting Center. Customer will configure and manage a corresponding IPSec tunnel based on 3-DES Shaw technology at Customer's location. The IPSec connection will be from specified devices at Customer's site to specified devices at the e-business Hosting Center as defined by Customer. Physical Database Administration (Microsoft SQL) IBM will provide physical and operational database administration support for Micorsoft SQL, database software (Database Software) for the number of Base Component database servers with the Database Software specified in Attachment B (Database Administration Servers). Customer will provide all Database Software, and any required licenses, as a Customer Component. IBM will install Database Software on the Database Administration Servers. IBM will provide four (4) hours of database setup support for each of the Database Administration Servers. Each month IBM will provide four (4) hours of database administration support for each of the Database Administration Servers. Additional hourly database administration and setup support charges will be at the additional hourly support rate specified in Attachment C, unless otherwise specified in a project change request between Customer and IBM. IBM will not provide Physical or Logical data base administration for MySQL. Customer Care IBM will provide a toll free number (inside the US) to receive problem notifications and service requests 7x24 each day of the year from authorized Customer representatives regarding Services provided under this Agreement. Customer representatives shall be identified via email to the IBM project manager. Changes or additions to the Customer representatives will also be made to the IBM project manager via email.

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IBM will assign the following priority levels to each reported problem as listed in the table below: Severity 1 - Critical impact problem that makes the Customer environment unavailable or degraded to a level where Customer is unable to conduct business. Severity 2 - Major Impact. Customer is able to conduct business but a function or service is not available. Severity 3 - Minor impact. The Customer environment is not seriously affected. Severity 4 - No impact. Short coming, dissatisfaction, or question. Emergency - Ability to conduct business is not being affected, however due to other business driving decisions, the request needs to be treated as a Severity 1. IBM will: attempt to resolve on the first call service requests such as password resets for administrative ID's, access control for authorized Customer representatives following the mutually agreed process and starting and stopping of services. document Customer or IBM internally generated call identification data in their Customer Care (Technical Support) System. provide monthly reports showing service request, resolution, call aging data, and other call report information within ten (10) business days from the end of the calendar month. The reports will be provided via the web portal. direct Customer calls, as appropriate, to an IBM technical specialist, coordinate problem determination, attempt resolution, perform root cause analysis, make ticket history available via the web portal and log and track calls to closure.

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will assign the following priority levels and respond to each reported problem as shown in the following table: Severity Initial Communication Recurring Communication Communication Content 1 - Critical Impact IBM provides notification within 15 minutes of a confirmed outage.

IBM support is available 24 x 7 for the duration of the outage. On-site support at IBM Hosting facility within four (4) hours when IBM on-site support is requested by Customer.

· Current Status · Estimated Resolution Time · Next Activity Planned

2 - Major Impact IBM provides notification within 30 minutes of a confirmed outage.

IBM support is available 24 x 7 for the duration of the outage. · Current Status · Estimated Resolution Time · Next Activity Planned 3 - Minor Impact IBM provides notification within 1 hour of a confirmed outage.

IBM support is available 24 x 7 for the duration of the outage. · Current Status · Estimated Resolution Time · Next Activity Planned 4 - No Impact or a Question IBM provides notification within 24 hours. IBM support is available 24 x 7 for the duration of the outage. · Current Status · Estimated Resolution Time · Next Activity Planned Emergency IBM provides notification within 15 minutes of a confirmed outage

IBM support is available 24 x 7 for the duration of the outage. Each Customer is only allowed three (3) emergency requests per month.

· Current Status · Estimated Resolution Time · Next Activity Planned

Customer is allowed up to three (3) emergency requests per month at no additional charge. Additional emergency requests will be charged at the additional hourly support rate specified in Attachment C. Relocation of Managed Hosting Services In the event that IBM determines that it is necessary to relocate Managed Hosting Services within the same or to another e-business Hosting Center, Customer will cooperate in good faith with IBM to facilitate such relocation, provided that such relocation is based on reasonable business needs of IBM (including the needs of other IBM customers), or the expansion of the space requirements of Customer. IBM will use commercially reasonable efforts, in cooperation with Customer, to minimize any interruption to Services in the event of such relocation. Security Obligations IBM will: implement firewall settings and other security parameters as defined by Customer and accepted by IBM; administer firewalls specified in Attachment B; perform nightly memory and file system anti-virus scanning and install virus signature definition file updates, as available, for Base Components and Customer Components with Windows operating systems; perform regular scanning of commonly used TCP and UDP ports, on Base and/or Customer Components to attempt to detect ports and services that may be vulnerable to intrusion. IBM will

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use reasonable efforts to inform Customer of intrusion vulnerabilities detected, and schedule and apply changes to security settings agreed to by Customer to attempt to mitigate vulnerabilities. IBM makes no representation or warranty that IBM's monitoring or analysis procedures will identify all intrusions Customer may encounter; perform monthly security parameter status checking and identify when security checking finds parameter status to be different from what was originally established; and authorize root access, administrator access or their equivalents for Base Components to IBM-designated personnel only. Customer must comply and ensure any Customer Subcontractors comply with the following security obligations. Customer will: authorize IBM to perform the Services described above in item a. of Security Obligations; provide firewall setting requirements (ports, filters, and traffic direction) to IBM and provide the number of nodes required for IBM to perform firewall administration; provide IBM with security parameters and settings. Security parameters and settings will be used for monthly security status checking and are subject to IBM's review and acceptance; not access or attempt to access IBM's secure internal network or the resources or information of other IBM customers; when performing any technical security integrity review, penetration test, or vulnerability scan of  Base Components or Customer Components: (a) only test, scan or review the IP addresses supplied by IBM to Customer that are part of the Services; (b) only test, scan, or review Customer dedicated Base Components and Customer Components; (c) provide IBM at least one week's prior written notice of the date and time of the review; (d) provide the source IP address information and reviewer contact information to IBM; (e) not perform such reviews more than once per calendar quarter; and not perform or simulate denial-of-service attacks; not administer or create privileged User IDs (User IDs having system or security administrative authority) at the base operating system level or on subsystems managed by IBM; and not disclose any information arising out of IBM or Customer scanning of Base Components or Customer Components to any other entity without IBM's prior written consent. IBM strongly recommends that Customer and any Customer Subcontractors comply with the security guidelines listed below, but Customer may deviate from such guidelines after prior written notice to IBM. IBM will have no liability for any damages arising out of Customer's or Customer's Subcontractors' deviation from any or all of the following guidelines: not use Base Components or Customer Components as a relay to provide Internet access at Customer locations; initiate connections from Base Components or Customer Components to Customer Premises Equipment using either caller ID or Challenge Handshake Authentication Protocol (CHAP); only initiate traffic flows from more secure to less secure networks (i.e., from the Customer secure network to the e-business hosting environment ); access Servers in the e-business Hosting Environment from Customer's premises by establishing a one way trust relationship with password when using Windows; not initiate NFS traffic through the Internet access firewall; only use NFS within a single layer, meaning NFS traffic will not cross firewalls and the Servers will be in the same VLAN; not place NFS export files in the same file structure used for system files and executable files in Customer Components; when creating CGI programs, such programs will: (a) validate input to construct a command line. The input character string will have to be validated to ensure that it does not trigger an undesirable system response including the ability to change file permissions; (b) do not run in privileged mode;

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(c) do not create files in any system-related directory; (d) do not need to be stored in any directory other than a designated cgi-bin directory or require the interpreter be stored in the cgi-bin directory; and (e) do not create buffer overflow conditions or other problems that could expose the Server to unauthorized access; not initiate inbound ICMP echo requests or replies from the Internet to the Base Components or Customer Components and outbound ICMP echo replies or ICMP replies for traceroute from the Base Components or Customer Components to the Internet unless Customer provides IBM with source IP addresses; and 10. not initiate SNMP traffic from Customer premises to the e-business Hosting Environment. Technical Due Diligence Period A two (2) week technical due diligence period commencing within two (2) weeks following the execution of this Agreement is required. During this technical due diligence period Customer and IBM technical teams will work together and determine more specific detail regarding configuration, networking, firewall, server, SAN, backup and monitoring installation, configuration and management details, settings, rules, and the schedules and thresholds to be monitored. Any changes as a result of the technical due diligence period will be handled as follows: Any delays in the procurement of equipment will be documented in the project plan by the IBM project manager and communicated to Customer in a timely manner. Any delays in the schedule will be documented in the project plan by the IBM project manager and communicated to Customer in a timely manner; and IBM and Customer will use the PCR process to make any changes to this Agreement as a result of this technical due diligence period. Changes may result in adjustments to pricing. Service Level Agreement IBM will provide an availability service level agreement (Server Availability SLA) for Qualifying Servers based on the applicable SLA Target Percentage (as such terms are defined below). The first device in the path to the Qualifying Server must be an IBM Managed Device, and the Server Availability SLA applies up through and including the last IBM Managed Server. Definitions The following definitions apply to this Server Availability SLA: Actual Available Minutes (AAM) means the Total Available Minutes minus minutes of Qualified Outages. Availability Credit means an amount equal to five percent (5%) of monthly recurring charges for Managed Hosting Services.  Such credits are available when the services provided for the affected devices are less than the Monthly Availability Percentage. IBM Managed Device means a Base Component located in an IBM e-business Hosting Center for which IBM is performing management responsibilities. For servers, only the servers identified as Fully Managed Servers in Exhibit A are considered an IBM Managed Device. Monthly Availability Percentage means the amount equal to the total number of minutes in the applicable month minus the Qualifying Outage Minutes for that month, divided by the total number of minutes in that month. Monthly Recurring Charge means the total of Customer's monthly recurring charges. Outage means the period (measured in whole minutes) from the time indicated in a trouble ticket (when the Outage was reported to IBM) to the Outage end time based upon the problem resolution (as reflected in the trouble ticket call record). For clustered devices, all of the devices in the cluster must not be available for use by Customer. Qualifying Server means the IBM Managed Server that has been selected by Customer and approved by IBM. Qualifying Outage Minutes means the aggregate of all Outages in a month, minus any Outages in that month resulting from any exclusion described in Section 8.6 below. SLA Target Percentage means the Service Levels defined in 8.2 (Service Levels). Unqualified Outage(s) means an Outage(s) that can be attributed to the listed availability exclusions as set forth in Section 8.6 (Exclusions).

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Service Levels

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Service Levels IBM will provide the following monthly availability Service Level Agreement (SLA) for the Services provided by IBM: For Managed Devices and Managed Servers (including firewall(s) and switches) that are not clustered or configured in a high availability configuration, the SLA is a minimum of 99.7 percent. For Managed Devices and Managed Servers (including firewall(s) and switches) that are clustered or configured in a high availability configuration, the SLA is a minimum of 99.9 percent. For Managed Application Solution (including firewalls(s) and switches) that are clustered or configured in a high availability configuration, the SLA is a minimum of 98.0 percent. For Managed Application Solution (including firewalls(s) and switches) that is not clustered or configured in a high availability configuration, the SLA is a minimum of 99.5 percent. For Basic Monitoring Services the SLA is a minimum of 99.9 percent applicable only for the core infrastructure components (including power, cooling, Internet connectivity, firewalls, load balancers, SSL acceleration, Network Intrusion Detection, VLAN segments, switches, VPN connection at the Hosting Center, and all related connections). For Advanced Monitoring Services the SLA is a minimum of 99.9 percent applicable only for the core infrastructure components (including power, cooling, Internet connectivity, firewalls, load balancers, SSL acceleration, Network Intrusion Detection, VLAN segments, switches, VPN connection at the Hosting Center, and all related connections). Availability Credits If in any month during the term of Managed Hosting Services the Monthly Availability Percentage for a Qualifying Server is less than the SLA Target Percentage for that Qualifying Server, Customer shall be eligible to receive an Availability Credit, subject to Section 8.3(b), 8.4, 8.5, 8.6 and 8.7. If in any month during the term of Managed Hosting Services the Monthly Availability Percentage for Basic Monitoring or Advanced Monitoring Services is less than the SLA Target Percentage for Basic Monitoring or Advanced Monitoring Services, Customer shall be eligible to receive an Availability Credit, subject to Section 8.3(b), 8.4, 8.5, 8.6 and 8.7. Customer agrees to contact the IBM Help Desk to report problems and open trouble tickets that reflect the start time of the Outage event. Settlement of Credits Availability Credits will be aggregated on a quarterly basis and settled by the last day of the first month following the end of the quarter in which such Availability Credits were earned. (For example, the aggregate Availability Credits earned in the first quarter 2007 will be applied against Monthly Recurring Charge for Services the Customer incurs in the April 2007 invoice.) Any Availability Credits owed from IBM to Customer upon the expiration or termination of the Services will be paid within one (1) month following the effective date of expiration or termination. If the Monthly Recurring Charge for a subject month has not been incurred, or for any other reason has been credited or waived, Customer shall not be eligible for an Availability Credit for that month. Customer shall receive no more than five percent (5%) of Customer's Monthly Recurring Charge for Managed Hosting Services as an Availability Credit in a given month. Commencement of Service Level Agreement IBM will exercise commercially reasonable efforts to meet the SLA Target Percentage. Notwithstanding the foregoing, Customer shall not be eligible for an Availability Credit until the first full calendar month following the Hosting Service Ready Date. Exclusivity of Remedies Customer agrees that its sole remedy for IBM's failure to meet an SLA Target Percentage is the Availability Credit as provided in this Attachment. Exclusions IBM is not responsible for any Outage outside of its control, including but not limited to, the following examples: periods of scheduled or emergency maintenance activities or scheduled Outage; Outage due to problems with Customer provided Content or programming errors including, but not limited to, Content installation and integration;

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Outage due to system administration, commands, file transfers performed by Customer representatives; Outage due to work performed at Customer request (for example T&M assistance); other activities Customer  directs, denial of service attacks, natural disasters, changes resulting from government, political, or other regulatory actions or court orders, strikes or labor disputes, acts of civil disobedience, acts of war, acts against parties (including carriers and IBM's other vendors), and other force majeure items; lack of availability or untimely response time of Customer to respond to incidents that require its participation for source identification and/or resolution, including meeting Customer responsibilities for any prerequisite Services; Outage due to Customer breach of its material obligations under the Base Terms; Outages caused by Customer Content or Customer initiated patches; Outages caused by Customer not approving applying IBM recommended OS patches; Outages caused by the Customer not approving applying of OS maintenance releases; Periods where the Customer may have been granted System Administration rights; Customer denies IBM recommended software patches, hardware and/or OS changes; m. Outage due to failure of non-IBM managed Customer Component hardware or software; Power outages caused by customer not providing dual power equipment; Power outages caused by improperly configured power supplies; Power outages caused by incorrectly connected power supplies; Power outages caused by customer configured and managed equipment that results in over utilization of power circuits; and Customer's performance of any technical security integrity review, penetration test, or vulnerability scan pursuant to security obligations set forth herein. Open Source Software additional terms If requested by Customer, IBM will procure Red Hat Linux Software on behalf of Customer. The Red Hat software will be provided as a Customer Component (Customer Component Linux Software) licensed by Red Hat, Inc. (Red Hat) to Customer under Red Hat's Subscription Agreement (accessible at http://www.redhat.com/licenses). Customer agrees to the terms and conditions of Red Hat's Subscription Agreement and agrees that Red Hat's Subscription Agreement for the Customer Component Linux Software shall be between Red Hat and Customer. The Linux operating system Customer Component software will be shipped to Customer, not IBM. IBM is not a party to such license.  IBM's provision of Services hereunder shall not constitute a distribution of the Customer Component Linux Software by IBM. If requested by Customer, IBM will install Customer Component Linux Software as is and makes no representations or warranties, either express or implied, with respect to the Customer Component Linux Software or any Open Source Software and does not indemnify against any claim that Customer Component Linux Software or any Open Source Software infringes a third party's intellectual property right. Under no circumstances shall IBM be liable for any damages arising out of Customer's use of the Customer Component Linux Software or any Open Source Software. Customer receives no express or implied patent or other license from IBM with respect to the Customer Component Linux Software or any Open Source Software. Customer and IBM agree that any modification or creation of derivative works of Linux or Open Source Software is outside the scope of this Agreement. Linux and any other Open Source Software (OSS), including patches, fixes, and updates, which IBM installs, configures, updates, operates or otherwise assists in procuring on Customer's behalf as a result of providing services under this Agreement are licensed and distributed to you by Linux and OSS distributors and/or respective copyright and other right holders, including Red Hat, Inc. (Right Holders) under the Right Holders' terms and conditions.  IBM is neither a party to the Right Holders' terms and conditions nor a distributor of Linux or OSS and merely does the work described in this Agreement on your behalf upon your specification. You receive no express or implied patent or other license from IBM with respect to Linux or any OSS. IBM installs Linux and OSS as is and makes no representations or warranties, either express or implied, with respect to Linux or OSS, and does not indemnify against any claim that Linux or OSS infringes a third party's intellectual property right. Under no circumstances shall IBM be liable for any damages arising out of your use of Linux or OSS.

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Both of us agree that any modification or creation of derivative works of Linux or OSS is outside the scope of this Agreement. Responsibilities of IBM and Customer Overall - (with physical database administration support)

RESPONSIBILITIES IBM CUSTOMER

- Installation -

Designate an individual to whom all of IBM's communications will be addressed and who has the authority to act and make decisions for Customer in all aspects of the Services, including requesting changes, problem resolution, Service requests, assignment of Customer focal points with authority over specific Services, and designation of Customer Authorized Representatives (Customer Contact)

  Perform

Designate an individual to whom Customer will address communications specific to the provision of the Services. IBM's call management center may be the IBM Contact for some Services (IBM Contact) Perform

Assign authorized representatives with appropriate functional knowledge and technical skill who may submit problems or Service requests to the IBM call management center by calling an IBM-provided toll-free telephone number or by e- mail   Perform

Perform the installation activities specified herein Perform   Register domain names with an accredited domain name registrar and pay all charges associated with such registration   Perform

Install Customer applications   Perform Perform physical DBA tasks to install and configure the database(s) Perform   Perform all logical DBA tasks to install and configure the databases   Perform Provide backup and restore requirements to IBM   Perform Perform necessary physical database administration tasks to prepare Customer database(s) for backup Perform

Perform necessary logical database administration tasks to prepare Customer databases for backup   Perform

Provide e-mail addresses for Customer notification of thresholds exceeded or process exceptions   Perform

Procure Base Components specified in Attachment B Perform   Notify Customer when IBM installation activities are completed (Hosting Service Ready Date) Perform

Provision all SSL certificates   Perform Inform IBM in writing within five (5) business days following IBM's notification of the completion of IBM installation activities, if Customer believes IBM has not satisfactorily completed IBM installation activities   Perform

- Ongoing Management and Support -

Provide the ongoing Services specified herein Perform   Provide ongoing administration, tailoring, monitoring, or maintenance of Customer applications   Perform

Provide first level of support for problems with Customer Components and transfer problems related to IBM's responsibilities to the IBM call management center   Perform

Assist IBM in the investigation of problems, to the extent such investigation involves Customer's or its Subcontractors' responsibilities, and exercise commercially reasonable efforts to resolve problems related to such responsibilities   Perform

Provide ongoing physical database administration for the database(s) Perform   Provide ongoing logical database administration   Perform Perform the IBM security obligations specified herein Perform   Perform the Customer security obligations specified herein   Perform

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Update Base and/or Customer Components with applicable fixes (patches, hotfixes, program temporary fixes and service packs) as determined by IBM Perform

Maintain responsibility for all labor and expenses associated with full version operating system software upgrades (to be eligible for continued service, the operating system version running on the managed servers must be one currently supported by the manufacturer of that operating system)   Perform

Maintain copies of critical Content and establish a procedure to recover such Content without resort to the e-business Hosting Environment or Services   Perform

Manage all SSL certificates   Perform

Server

RESPONSIBILITIES IBM Customer

- Installation, Configuration and Setup for Fully Managed Servers

Rack and stack and cable the equipment Perform   Procure and install Base Components Perform   Provision cabinet space Perform   Provision additional power Perform   Create network diagram Perform   Assign public and private IP addresses Perform   Provision internet bandwidth Perform   Procure licenses for backup tools and agents Perform   Load CDs, if requested by Customer Perform   Configure IP addresses on the servers Perform   Perform connectivity testing of Base and/or Customer Components Perform   Identify the predefined events that will be monitored   Perform Configure thresholds defined by Customer Perform   Install and configure monitoring tools Perform   Install and configure clients for the monitoring tools Perform   Perform readiness testing, including testing the flow of alerts Perform   Enable switch monitoring Perform   Notify Customer when installation activities are completed Perform

- Ongoing Management and Support for Fully Managed Servers -

Perform 7 x 24 each day of the year monitoring of the managed servers for actions and events Perform

Maintain required documentation for server management and operation Perform   Research OS patches Perform   Provide problem determination and corrective measures and support for alerts and predefined error events and thresholds Perform

Use reasonable efforts to update Base and/or Customer Components with applicable fixes approved by the Customer Perform

Load CDs if requested by Customer Perform   Call IBM Service if needed Perform   Assist IBM in the investigation of problems with the Services to the extent such investigation involves Customer's or its subcontractors' responsibilities   Perform

Monthly reports of thresholds being measured Perform   Perform root cause analysis for problems related to the equipment or services being provided by IBM Perform

Page 28 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Shared or Dedicated SAN Storage

RESPONSIBILITIES IBM Customer - Installation, Configuration and Setup -     Install SAN configuration and management console and agents on the SAN Storage Perform   Provide IBM with disk configuration specifications (folders, directories, quorum disk layout, disk space size, and Raid level)   Perform

Configure Server HBAs for access to the SAN Storage Perform   Install the SAN devices Perform   Connect the SAN storage device to the SAN switches and to the administration segment Perform

Define storage partitions   Perform Configure the SAN storage per Customer provided specifications Perform   Provide documentation which details the installation parameters for the server and SAN storage Base and/or Customer Components Perform

Document SAN storage configuration Perform   Test SAN storage functionality Perform   Perform connectivity testing of the SAN storage Perform   Perform quality assurance reviews on all operational and administrative support procedures Perform

Identify the predefined actions and events (the Actions and Events) IBM will perform on the SAN Storage Perform

- Ongoing Management and Support -     Maintain required documentation for the SAN storage management and operation Perform   Perform 7x24 everyday of the year monitoring of the managed SAN storage for actions and events Perform

Provide problem determination and corrective measure support for actions and events Perform

Reallocate SAN based LUNS to different systems and servers (for example: rezoning, import, recognition, and file system remount), as requested by Customer. Perform

Assist IBM in the investigation of problems with the Services to the extent such investigation involves Customer's or its Subcontractors' responsibilities   Perform

Page 29 of 36

Backup, Restore and Offsite Data Storage

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Backup, Restore and Offsite Data Storage

RESPONSIBILITIES IBM Customer

- Installation, Configuration and Setup -

Install selected Base Components, including external cable connections and storage server Perform

Connect the tape library to the designated backup media server Perform   Document the tape library and backup media server configuration and setup parameters Perform

Test hardware functionality Perform   Notify IBM of any specific procedures required for backup of Customer data files and the scheduled backup window   Perform

Creation and documentation of Customer backup and restore procedures Perform   Provide list of files to be backed up   Perform Identify and maintain list of Customer designated data files to be backup up Perform   Install and configure the storage manager software provided by IBM Perform   Verify that the storage manager software is installed and configured properly Perform   Install backup software clients Perform   Configure backup software clients on OS instances Perform   Perform a test backup of the systems by initiating a backup of Customer designated data files Perform

- Ongoing Management and Support -

Maintain required documentation for server management and operation Perform   Assist IBM in the investigation of problems with the Services to the extent such investigation involves Customer's or its subcontractors' responsibilities   Perform

Perform daily incremental backups Perform   Perform weekly full system backups Perform   Keep daily backups in the library for seven (7) days backups (actual backup, retention and rotation schedules to be determined by Customer and IBM) Perform

Create a copy on tape of the weekly full system backup tapes and send offsite for storage with thirty (30) days retention Perform

Examine backup logs for results of daily backup activity Perform   Take actions to alleviate alerts and error messages during the backups Perform   Call the IBM Help Desk to request a take to be restored from the library or from offsite storage.   Perform

Indicate if the offsite storage recall is an emergency request to be fulfilled within six (6) hours (additional charges may apply)   Perform

Identify data file name and version requiring restore   Perform Initiate obtaining of the tapes(s) from offsite storage, if necessary Perform   Initiate restore of Customer designated backed up files as requested Perform   Perform root cause analysis for problems Perform

Page 30 of 36

Switch and Firewall

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Switch and Firewall

RESPONSIBILITIES IBM Customer - Installation, Configuration and Setup -     Configure the local VLANs Perform   Specify switch and firewall settings specific to the application   Perform Configure VLANs and zones for the SAN switches Perform   Configure firewall settings Perform   Test a single path to switch and firewall Base and/or Customer Components Perform   Enable switch and firewall monitoring Perform   - Ongoing Management and Support -     Operate and monitor availability of the switches and firewalls 7x24 each day of the year Perform

Assist IBM in the investigation of problems with the Services to the extent such investigation involves IBM's, Customer's or its subcontractors' responsibilities   Perform

Request changes to switch and firewall settings   Perform Administer changes to switch and firewall Perform   Perform monthly patch scanning on servers that may be vulnerable to intrusion or need hot fixes applied Perform

Inform Customer of hot fixes and vulnerabilities detected and use reasonable efforts to schedule and apply changes to settings, as needed Perform

Backup Customer-specified switch and firewall settings and restore settings in the event of a failure Perform

Physical Database Administration (Microsoft SQL)

  IBM Customer

- Implementation -

Provide Customer with database survey to gather support requirements Perform   Complete database survey   Perform Acquisition of license for Database Software   Perform Configuration of Database Software in accordance with Customer requirements as provided in the database survey Perform Assist

Installation and configuration of application software and Content   Perform Provide documentation specifying the application directory structure, and/or database structure including table definitions, indices and table spaces   Perform

Establish connectivity between database instance and data server and notify Customer when Database Software is ready for use by Customer Perform

Create directory structure and/or execute database definitions Perform   Enable the application functions, once installed and configured, to work with the Database Software and Customer's hosting environment Assist Perform

Establish standard database availability monitoring to assess the availability of database components Perform

Provide documentation for application and database components to be monitored for availability   Perform

Acquire any necessary certificates or keys necessary for authentication functions associated with the Database Software   Perform

Install any certificates or keys provided by Customer necessary for authentication functions associated with the Database Software Perform

Retain control and management of the Database Software support/administration IDs/object owner IDs Perform

- Ongoing Management and Support -

Page 31 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Provide application software troubleshooting, problem determination, and problem resolution. Note, where the application software is third party software, IBM's responsibility will be limited to coordinating with the applicable vendor and managing such vendors resolution. Perform

Provide system software troubleshooting, problem determination, and problem resolution Perform

Assist Customer with Database Software in problem determination of application problems and notify Customer once a problem is suspected to be an application problem Perform Assist

Provide database troubleshooting and problem determination Perform   Contact appropriate IBM support organization for all database related problems after problem has been recorded in the problem management system with key problem- related data by IBM's call management center Perform

Determine backup/recovery plan   Perform Implement backup/recovery plan to allow point in time recovery or version recovery as determined by Customer Perform Assist

Provide application-level assistance in problem determination of Database Software problems   Perform

Assist Customer in application problem resolution through the implementation of database changes required by Customer Perform Assist

Apply fixes, PTFs and patches provided by Customer to correct database problems, as necessary, within the framework of the Project Change Control Procedures Perform

Install Database Software minor release upgrades for an already installed version of each database product using the IBM standard change control procedures (minor release upgrade is any change in the release number to the right of the point by the software manufacturer - e.g.: x.y) Perform

Provide any code promotions for application software code and all Content updates   Perform Install application software configuration changes, upgrades and patches, and any updates to Content. Notify IBM of any required database configuration changes needed as a result of the changes, upgrades and patches, and/or updates   Perform

Install system software configuration changes, upgrades and patches, and updates. Perform   Implement any required database configuration changes based on Customer's recommendations Perform

Provide all end user support including administration of application user Ids and groups and end user password resets   Perform

Provide requirements for pruning, rotation and/or archiving of any application and database log files   Perform

Implement any required pruning, rotation and/or archiving of any application and database log files Perform

Provide documentation for performance related parameter/configuration settings   Perform Implement initial database performance tuning and provide additional performance tuning based on analysis of performance metrics provided by Customer Perform Assist

Provide documentation on performance metrics and performance results that the application and database should be measured against, including any necessary tools and/or scripts to collect performance data   Perform

Implement automated performance monitoring and data collection Perform Assist Monitor Database Software components for availability and/or their presence in memory (up/down status) Perform

Assist Customer in testing efforts and monitoring of Customer-provided performance tools and metrics to determine if environment is properly tuned Perform Assist

Collection of performance and capacity data as provided by Customer's application(s) software Assist Perform

Implement performance enhancements to the specific Database Software based on documented tuning parameters and procedures supplied by Customer and specific to Customer application(s) Perform

Collection of performance and capacity data as provided by systems software Perform   Notify IBM within fifteen (15) minutes of a suspected a Database Software component problem   Perform

Monitoring application health and availability and functional testing of application   Perform Establish IBM as single point of contact with Database Software manufacturer   Perform Procure and keep current service contracts with the Database Software manufacturer for 24x7 maintenance and support including upgrades and updates/fixes. IBM will be named as a primary contact in the service agreement(s)   Perform

Page 32 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Provide the appropriate support information for Customer contact and Database Software manufacturer support contact (IDs, contact names, telephone numbers, license numbers, etc.)   Perform

Implementation of any Database Software product major version upgrade (major version upgrade is any change in the version number to the left of the point by the software manufacturer - e.g.: x.y)   Perform

Establish single point of contact with application software vendor   Perform

Attachment B - Hosting Components

Part I - IBM Provided Infrastructure

e-business Hosting Center: Atlanta

Internet Bandwidth Internet access committed bandwidth 3 Mbps Number of registered IP addresses 1

Virtualized Firewalls Quantity 2 Model Cisco virtualized firewalls Failover Configuration Yes Number IPSEC VPN tunnels to be set up at the IBM data center (Customer to set up and manage the corresponding VPN tunnels at their sites)

1

Virtual Firewalls Switch Ports and VPN tunnels Quantity of pairs of active / passive virtual firewalls 3

Virtual firewalls and switch ports for Virtual servers, including firewall ports 1

Additional remote clients for VPN sessions 0 Additional site-to-site VPN tunnels 9 Private dedicated backend connection 0

Page 33 of 36

Part II - IBM- managed Base Components

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Part II - IBM- managed Base Components Server Base Components

e-business Hosting Center: Atlanta

Fully Managed Server Base Components Server Quantity 2 Model x3650 Processor 2 x Dual-Core Intel Xeon Processor X5260 (3.33GHz 6MB 1333MHz 80W) Memory 8 GB Local Disk drives · 2 x 73 GB Disk for OS Used for OS, not Customer data OS * Linux RedHat AS SAN connections? No NAS connection? No Fully Managed? Yes Administrative rights owned by IBM during steady state? Yes

Quantity 10 Model x3850 Processor 2 slots, 4x 3 GHz CPUs Memory 8 GB Local Disk drives · 3 x 73 GB 2.5 disk- 2 OS + 1 hot spare OS * Win2003 (Qty 6), Linux RedHat AS (Qty 4). SAN connections? Yes NAS connection? No Fully Managed? Yes Administrative rights owned by IBM during steady state? Yes

SAN Fabric and SAN Storage Base Components - Shared Environment SAN Fabric Number of servers connected to the SAN 10 Number of SAN switch Ports 20

SAN Storage Base Components - Shared environment SAN Storage - Shared Amount of usable space to be allocated, in GB 1600 GB

Raid Level Raid5 (standard)

Page 34 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Part III - Customer Components Customer will provide all Content and all components not specified as IBM provided infrastructure or IBM provided Base Components in Part I or Part II of this Attachment B.

Page 35 of 36

Attachment C - Charges

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009





Attachment C - Charges

One-time Charges One-time charges for Managed Hosting Services of $81,217.00 will be invoiced in January 2009 and payable in accordance with section 5.2 Payment. Monthly Recurring Charges Monthly recurring charges for Managed Hosting Services of $37,000.00 will begin on the Hosting Service Ready Date and may be prorated based on the date during the month that Managed Hosting Services commence, change, or end. Usage Charges

Additional hourly support Operational Assistance Per Hour $89.10 SmartHands (systems administrative and technical assistance) Per Hour $188.02 Operational DBA Per Hour; MS SQL $204.37 Charges for additional hourly support requested by Customer, if any, (support that is outside the scope of services included in the monthly recurring charges specified above) will be due as incurred. IBM will charge for additional hourly support in fifteen (15) minute increments. b. Peak Bandwidth Usage Peak Bandwidth Usage charges for data traffic in excess of Committed Bandwidth are due as incurred.  IBM will determine Peak Bandwidth Usage charges each month by subtracting the Committed Bandwidth from the Peak Bandwidth Usage for that month and multiplying the difference by the Peak Bandwidth Usage rate of $147.14.00 per Mbps. c. SmartHands hourly support Charges for SmartHands hourly support requested by Customer, if any, will be due as incurred. IBM will charge for SmartHands hourly support in fifteen (15) minute increments. d. Additional Hourly Database Support Charges for additional hourly database support (Additional Hourly Database Support) requested by Customer, if any, (database support that is outside the scope of database support hours included in the monthly recurring charges) will be due as incurred. IBM will charge for Additional Hourly Database Support in fifteen (15) minute increments. Termination Charges In the event the Customer elects to terminate this Agreement, or any portion of the Services described herein, for convenience, Customer will pay the applicable termination charges as set forth in the table below. 3-year (thirty six (36) month) Term: For termination: For any terminated Services, Customer will be charged:

prior to first anniversary of the Hosting Service Ready Date four (4) months' applicable recurring monthly charges plusany unpaid One Time Charges from the first anniversary of the Hosting Service Ready Date and prior to the second anniversary of the Hosting Service Ready Date

three (3) months' applicable recurring monthly charges

from the second anniversary of the Hosting Service Ready Date and prior to the expiration of this Agreement two (2) month's applicable recurring monthly charges

Page 36 of 36

Source: QUANTUM GROUP INC /FL, 8-K, 1/20/2009

Ex Output:
Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?


Ex Input:
EXHIBIT 10.32

               CO-BRANDING, MARKETING AND DISTRIBUTION AGREEMENT

     This Agreement, dated as of January 30, 2000 (Effective Date), is made and entered into by and between Amazon.com Commerce Services, Inc., a Delaware corporation (ACSI), and Audible Inc. a Delaware corporation (Company).  ACSI and Company are sometimes referred to collectively herein as the Parties and individually as a Party.  ACSI and Company agree as follows:

Section 1.  Definitions

     Whenever used in this Agreement with initial letters capitalized, the following terms shall have the following specified meanings:

     ACSI Competitor means, collectively, such persons and entities as the Parties may agree upon from time to time.  ACSI may update any agreed-upon list of ACSI Competitors no more frequently than once per quarter by written notice, provided that: (a) the number of entities specified on such list shall at no time [***]; (b) any entities added to such list must be [***]; and (c) no addition of any ACSI Competitor to such list shall require Company to breach any contractual or legal obligation to such ACSI Competitor by which Company is bound as of the date of such addition.

     ACSI Derivative Work means any Derivative Work (whether created by ACSI, Company, or the Parties jointly) of any ACSI Existing Intellectual Property or ACSI Future Intellectual Property.

     ACSI Existing Intellectual Property means, collectively, all of the following existing as of the Effective Date: (a) the Trademarks of ACSI and its Affiliates; and (b) the ACSI Site, including, without limitation, any and all content, data, URLs, domain names, technology, software, code, user interfaces, look and feel, ACSI Site Functionality, Trademarks and other items posted thereon or used in connection or associated with any of the foregoing.

     ACSI Future Intellectual Property means, collectively, all of the following which are invented, created, developed or first reduced to practice by ACSI or its Affiliates after the Effective Date without the participation of Company or its Affiliates: (a) any Trademarks; and (b) any content, data, URLs, domain names, technology, software, code, user interfaces, look and feel, ACSI Site Functionality and other items (but excluding any Company Derivative Works).

     ACSI Intellectual Property means, collectively, any ACSI Existing Intellectual Property, ACSI Future Intellectual Property and ACSI Derivative Works, but excluding any Joint Works.

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -1-

     ACSI Product Section means a discrete group of products available on the ACSI Site which is identified by a tab or other top-level product category identifier on the ACSI Site Home Page, but excluding: (a) the ACSI Site Home Page itself; and (b) any mechanisms, areas or services on or through which third parties may sell products through the ACSI Site in connection with ACSI's and its Affiliates' programmatic selling initiatives (including, without limitation, the existing Auctions, zShops, Sothebys.amazon.com and Amazon.com Advantage areas and services of the ACSI Site, and any successors or replacements to any of them).

     ACSI Product Sub-Section means a discrete sub-set of products in any ACSI Product Section which is accessible by following or using a browse tree or hypertext links on the ACSI Site, and is identified by a permanent product category description on the ACSI Site  (e.g., as opposed to a description generated in response to a user search query), but is not identified by a tab or other top-level product category identifier on the ACSI Site Home Page (e.g., as of the Effective Date, the business & investing or audio books sub-set of products included in, and accessible through the browse tree of, the ACSI Product Section identified by the Books tab on the ACSI Home Page (the Books Product Section)).

     ACSI Site means that Web Site, the primary Home Page of which is identified by the URL www.amazon.com (and any successor or replacement Web                       -------------- Site).  For the avoidance of doubt, the ACSI Site does not include any other Web Sites maintained by or for ACSI or its Affiliates (including, without limitation, those Web Sites, the primary Home Pages of which are identified by the URL's www.amazon.co.uk and www.amazon.de).           ----------------     -------------

     ACSI Site Functionality means, collectively: (a) tab, search and browse functionality available to users of the ACSI Site for navigating through ACSI Product Sections (including, without limitation, the layout and design thereof); (b) payment and transaction functionality available to users of the ACSI Site for purchasing products (including, without limitation, shopping cart and Payment with 1-Click functionality), (c) any other functionality available on the ACSI Site which ACSI may make available to Company from time to time, and (d) any future equivalents, improvements and enhancements of any of the foregoing.

     Affiliate means, with respect to any person or entity (including either Party), any other person or entity that directly or indirectly controls, is controlled by or is under common control with that person or entity, or which that person or entity beneficially owns at least fifty percent (50%) of the equity interests therein (provided, however, that with respect to the Parties, no individual or entity as to which the ultimate parent entity of a Party does not directly or indirectly control the operations or management thereof (e.g., in the case of ACSI as of the date of this Agreement, Gear.com, Inc.) shall be deemed to be an Affiliate of such Party for purposes of this Agreement).

     Annual Fee means the sum of [***], representing the fixed fee payable by Company to ACSI with respect to each Year.

---------------

Source: AUDIBLE INC, 10-Q, 11/13/2000





***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -2-

     Change of Control means, with respect to Company, a transaction or series of related transactions that results in (a) a sale of all or substantially all of the assets of Company, (b) the transfer of fifty percent (50%) or more of the outstanding voting power of Company (other than directly or indirectly to a parent or wholly-owned subsidiary of Company), or (c) the acquisition by a person or entity, by reason of any contractual arrangement or understanding with one or more persons or entities, of the right or power to appoint or cause to be appointed a majority of the directors or officers of Company.

     Claim means any claim, action or proceeding instituted by a third party (other than an Affiliate of a Party), including, without limitation, any governmental authority.

     Closing means the consummation of the purchase of common stock of Company pursuant to the Securities Purchase Agreement between ACSI and Company dated on or about the Effective Date (the Securities Purchase Agreement).

     Company Derivative Work means any Derivative Work (whether created by ACSI, Company, or the Parties jointly) of any Company Existing Intellectual Property or Company Future Intellectual Property.

     Company Existing Intellectual Property means, collectively, all of the following existing as of the Effective Date: (a) the Trademarks of Company and its Affiliates; (b) the Company Site, including, without limitation, any and all content, data, URLs, domain names, technology, software, code, user interfaces, look and feel, Trademarks and other items posted thereon or used in connection or associated with any of the foregoing

     Company Future Intellectual Property means, collectively, all of the following which are invented, created, developed or first reduced to practice by Company or its Affiliates after the Effective Date without the participation of ACSI or its Affiliates: (a) any Trademarks; and (b) any content, data, URLs, domain names, technology, software, code, user interfaces, look and feel or other items (but excluding any ACSI Derivative Works).

     Company Intellectual Property means, collectively, any Company Existing Intellectual Property, Company Future Intellectual Property, and Company Derivative Works, but excluding any Joint Works.

     Company Site means, collectively: (a) that Web Site, the primary Home Page for which is identified by the URL www.audible.com (and any successor or replacement Web Site); and (b) any other Web Sites operated by or for Company or its Affiliates from time to time (excluding the Mirror Company Site) through which Spoken-Word Audio Products are sold or offered for sale.

     Confidential Information means, with respect to either Party, all information relating to such Party or its Affiliates that is designated as confidential or that, given the nature of the information or the circumstances surrounding its disclosure, reasonably should

                                      -3-

be considered as confidential. Confidential Information includes, without limitation, (a) all information relating to a Party's or its Affiliates' technology, customers, business plans, promotional and marketing activities, finances and other business affairs; (b) all third party information that a Party or its Affiliates is obligated to keep confidential; and (c) the terms of this Agreement. Confidential Information may be contained in tangible materials, such as drawings, data, specifications, reports and computer programs, or may be in the nature of unwritten knowledge. Confidential Information does not include any information that (i) has become publicly available without breach of this Agreement, (ii) can be shown by documentation to have been known to the Receiving Party at the time of its receipt from the Disclosing Party or its Affiliates without a breach of confidentiality or other improper means, (iii) is received from a third party who did not acquire or disclose such information by a wrongful or tortious act or (iv) can be shown by documentation to have been independently developed by the Receiving Party without reference to any Confidential Information.

     Derivative Work means any adaptation, modification, enhancement, improvement or derivative work.

     Disclosing Party means a Party that discloses Confidential Information to the other Party in connection with this Agreement.

     Exclusive Spoken-Word Audio Products means: (a) spoken-word audio-only products, in a format suitable for digital download and/or streaming, [***]

     Existing ACSI Product Section means any ACSI Product Section identified on the ACSI Site Home Page as of the Effective Date, as shown in the screen shot attached as Exhibit A.

     Home Page means, with respect to a Web Site or section of a Web Site (e.g., any section of the ACSI Site primarily related to an ACSI Product Section or ACSI Product Sub-Section), the Web page designated by the operator of the Web Site as the initial and primary end user interface for such Web Site or section of a Web Site.

     Internet Radio Service means a service through which users may receive interactive or other broadcasts via the Internet or other public or private data networks.

     Joint Work means any content, data, URLs, domain names, technology, software, code, user interfaces, look and feel or other items which are invented, created, developed or first reduced to practice jointly by the Parties after the Effective Date, are protected or protectable by any Intellectual Property Rights and either: (a) include or incorporate both ACSI Existing Intellectual Property, ACSI Future Intellectual Property and/or ACSI Derivative Works, on the one hand, and/or Company Existing Intellectual Property, Company Future Intellectual Property and/or Company Derivative Works, on the other hand; or (b) include or incorporate no ACSI Existing Intellectual Property or ACSI

Source: AUDIBLE INC, 10-Q, 11/13/2000





Derivative Works, on the one hand, or Company Existing Intellectual Property or Company Derivative Works, on the other hand; provided, however, that notwithstanding any other provision of this Agreement, to the extent that any such items incorporate in whole or in part any ACSI

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -4-

Site Functionality or technology, software, code, user interfaces or look and feel related thereto or incorporated therein, such items shall be deemed ACSI Derivative Works in their entirety and not Joint Works or Company Intellectual Property.

     Incentive Offer means either (a) a discount in the purchase price of Spoken-Word Audio Products offered for sale from or through the Spoken-Word Audio Sub-Section or (b) an equivalent benefit upon purchase of a Spoken-Word Audio Product from or through the Spoken-Word Audio Sub-Section.

     Intellectual Property Right means any patent, copyright, trademark, trade dress, trade name or trade secret right and any other intellectual property or proprietary right.

     Launch Date means the date on which the Parties mutually agree to launch the Spoken-Word Audio Sub-Section, but in any event no later than 90 days after the Effective Date.

     Law means any law, ordinance, rule, regulation, order, license, permit and other requirement, now or hereafter in effect, of any governmental authority of competent jurisdiction.

     Mirror Company Site means a mirrored version of that Web Site, the primary Home Page for which is identified by the URL www.audible.com (and any successor or replacement Web Site).  The primary home page of the Mirror Company Site shall be identified by the URL www.amazon.audible.com (or such other URL as                                     ---------------------- the Parties may agree upon).

     Proration Percentage means, as of any date within the Refund Period, the following quantity, expressed as a percentage: (a) one (1); minus (b) the sum of: (i) the number of days of the Refund Period which have elapsed prior to such date; divided by (ii) the total number of days in the Refund Period.

     Non-Exclusive Spoken-Word Audio Products means spoken-word audio-only products, in a format suitable for digital download and/or streaming (excluding Exclusive Spoken-Word Audio Products and Related Products), [***]

     Receiving Party means a Party that receives Confidential Information from the other Party in connection with this Agreement.

     Referral Information means any information disclosing that a specific end-user traveled from the ACSI Site to the Mirror Company Site or purchased any products through the Spoken-Word Audio Sub-Section (however obtained), or other personally-identifying information regarding users of the ACSI Site (including the Spoken-Word Audio Sub-Section).

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -5-

     Refund Period means the period of time from the date upon which Company makes the payment called for by Section 5.2.1  [Annual Fees] (or is deemed to have made such payment pursuant to Section 5.3  [Waiver of Payment Obligations]) until the end of Year 2.

     Related Products means: [***]

     Site means either the ACSI Site, on the one hand, or the Mirror Company Site and Company Site collectively, on the other hand, as required by the context.

     Spoken-Word Audio Products means, collectively, Exclusive Spoken-Word Audio Products, Related Products and Non-Exclusive Spoken-Word Audio Products.

     Spoken-Word Audio Sub-Section means an ACSI Product Sub-Section, to be created pursuant to this Agreement, featuring Spoken-Word Audio Products (but subject to Section 9.2 with respect to Related Products) and which shall be identified on the ACSI Site by such heading as the Parties may agree upon.

     Term means the term of this Agreement as defined in Section 10.

     Trademark means any trademark, service mark, trade name, trade dress, proprietary logo or insignia or other source or business identifier.

     Web Site means any point of presence maintained on the Internet or on any other public or private data network.  With respect to any Web Site maintained on the World Wide Web or any successor public data network, such Web Site includes all HTML pages (or similar unit of information presented in any relevant data protocol) that either (a) are identified by the same second-level domain (such as http://www.amazon.com) or by the same equivalent level identifier in any relevant address scheme, or (b) contain branding, graphics, navigation or other characteristics such that a user reasonably would conclude that the pages are part of an integrated information or service offering.

     Year means any period of twelve (12) consecutive months commencing on the Effective Date.

Section 2.  Spoken-Word Audio Sub-Section and Mirror Company Site

     2.1  Spoken-Word Audio Sub-Section.  Pursuant to the implementation procedures set forth in Section 4, ACSI will establish and, upon and following the Launch Date, maintain (or cause one of its Affiliates to maintain) on the ACSI Site during the Term

Source: AUDIBLE INC, 10-Q, 11/13/2000





-------- *** Confidential Information has been omitted and has been filed separately with     the Securities and Exchange Commission.

                                      -6-

the Spoken-Word Audio Sub-Section. In order to provide a harmonious and consistent user experience, the presentation, format, functionality and operation of the Spoken-Word Audio Sub-Section shall be generally consistent with that of other similar ACSI Product Sub-Sections (including, without limitation, by incorporating category headings and other navigational aids for specific types of Spoken-Word Audio Products offered by Company), except that ACSI will include prominent branding for Company where appropriate on pages of the Spoken-Word Audio Sub-Section. Subject to the foregoing and to Section 6, ACSI will determine the content, appearance, functionality and all aspects of the ACSI Site (including the Spoken-Word Audio Sub-Section) [***]

     2.2  Certain Company Obligations.  As of and following the Launch Date, Company will (a) maintain the Mirror Company Site, [***], (b) ensure that every page of the Mirror Company Site displays prominent, above-the-fold, graphical hypertext links (to be designed by ACSI and subject to Company's prior approval, which shall not be unreasonably withheld or delayed) which, when clicked, return the user to the ACSI Site, together with such other branding and Trademarks of ACSI as ACSI and Company may agree upon to be appropriate (provided, that if the Parties cannot agree upon such branding and Trademarks, notwithstanding any other provision of this Agreement, ACSI shall have no obligation to establish or maintain the Spoken-Word Audio Sub-Section until such time as the Parties have agreed upon the same; and provided further, that any disagreement shall be subject to the escalation procedure specified in Section 2.8  [Escalation of Certain Disputes] below), (c) ensure that the Mirror Company Site does not contain links to any Web Site other than the ACSI Site (including, without limitation, to the Company Site), (d) ensure that substantially all Spoken-Word Audio Products (and any other products approved by ACSI) available through the Company Site are available through the Spoken-Word Audio Sub-Section (but subject to Section 9.2 with respect to Related Products), (e) [***], and (f) [***].  Subject to the foregoing, Company shall have the right to limit the number of promotional incentives (e.g. free give-aways, low-cost promotional offers and the like) that are offered through the Spoken-Word Audio Sub-Section based upon the volume of traffic if such volume were to place Company in commercially untenable position as solely determined by Company.  Unless otherwise agreed by the Parties in writing, Company will be solely responsible for all pricing, delivery and fulfillment of any products, including Spoken-Word Audio Products offered by Company on or through the Spoken-Word Audio Sub-Section (including the Mirror Company Site).

     2.3  [***].

     2.4  Technical Standards; Customer Service.  Company will at all times comply with the technical and customer service requirements and Site standards (including, without limitation, user privacy policies and customer guarantees) to be agreed upon by the Parties within forty-five (45) days after the Effective Date and attached hereto as Exhibit B.  Any dispute arising related to the creation of such requirements and standards shall be subject to the escalation procedure specified in Section 2.8  [Escalation of Certain Disputes] below.  Without limiting the generality of the foregoing Company will: (a) at all times conduct its dealings with users of the Spoken-Word Audio Sub-Section in a professional and courteous manner which reflects favorably upon ACSI and its Affiliates and the ACSI Site; and (b) in any event ensure that the customer

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -7-

service provided to users of the Spoken-Word Audio Sub-Section (including, without limitation, in regard to product fulfillment and responsiveness to customer inquiries) is of as high a standard as is commercially reasonably possible and as good or better than that generally provided by any other online seller of Spoken-Word Audio Products in a format suitable for digital download.

     2.5  Referral Information.  Company will not disclose any Referral Information to any third party (except for third parties acting directly on behalf of Company in connection with Company's internal business and who have agreed in writing to maintain the same in confidence), or use or permit any third party to use any Referral Information to target communications specifically to users of the ACSI Site, primarily on the basis of such persons' being users of the ACSI Site, without ACSI's prior written consent (provided, however, that nothing in the foregoing shall prohibit Company from contacting its own customers generally (including contacting users of the ACSI Site as part of any such general contacts) or prohibit Company from using non-personal statistical information regarding such users in the aggregate for any purpose without ACSI's consent).  [***]

     2.6  ACSI Site Re-Design.  Notwithstanding any other provision of this Agreement, nothing in this Agreement shall limit ACSI's and its Affiliates' ability to re-design or modify the appearance, content and functionality of the ACSI Site (including any ACSI Product Section, ACSI Product Sub-Section, or any Home Pages); provided, however, that in the event that ACSI and/or its Affiliates redesign or revise the ACSI Site or any ACSI Product Section, the treatment of the Spoken-Word Audio Sub-Section in connection with such re-design or revision will be substantially similar to and consistent with the treatment of other ACSI Product Sub-Sections on the ACSI Site.

     2.7  Traffic Data.  Throughout the Term, on a monthly basis, Company will provide ACSI all relevant data requested from time to time by ACSI concerning behavior on the Mirror Company Site, to the extent such behavior reasonably relates to the online promotion or sale of products sold through the ACSI Site and/or Mirror Company Site and such data is reasonably available.  ACSI and its Affiliates will hold such data in confidence and will not use it except in connection with their marketing efforts or as otherwise may be  agreed by Company in writing.  Notwithstanding anything contained in this Section 2.7  [Traffic Data], Company will not be required to deliver to ACSI any user data in contravention of any applicable Law or Company's privacy policy (provided, that if Company modifies its privacy policy, Company shall revise the same in a manner which provides it the maximum legally permissible flexibility to provide the data

Source: AUDIBLE INC, 10-Q, 11/13/2000





specified in this Section 2.7  [Traffic Data] to ACSI).

     2.8  Escalation of Certain Disputes.  If any dispute arises relating to the matters described in Section 2.2(b)  [Certain Company Obligations], Section 2.4  [Technical Standards; Customer Service] or Section 4.1.3 of this Agreement, and the Parties are unable to resolve the dispute in the ordinary course of business, the Parties will use good-faith efforts to resolve the matter in accordance with this Section 2.8  [Escalation of Certain Disputes].  Within three (3) days

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                      -8-

following the written request of either Party (which will describe the nature of the dispute and other relevant information), the Parties' managers who are responsible for the ACSI/Company relationship will meet to resolve the dispute at a mutually convenient time and place.  If the relationship managers are unable to resolve the dispute within two (2) days following their initial meeting, they will refer the matter to the Parties' divisional executives who are responsible for the administration of this Agreement, along with a written statement (or statements) describing the nature of the dispute and other relevant information.  Within three (3) days following the referral of the matter to the Parties' divisional executives, the divisional executives will meet to resolve the dispute at a mutually convenient time and place.  Additional representatives of the Parties (but not their relationship managers) may be present at the meeting.  If the divisional executives are unable to resolve the dispute within two (2) days following their initial meeting, they will refer the matter to the Parties' Presidents, along with a written statement (or statements) describing the nature of the dispute and other relevant information. Within three (3) days following the referral of the matter to the Parties' Presidents (or equivalent officers), the Presidents will meet to resolve the dispute at a mutually convenient time and place.  Additional representatives of the Parties (but not their relationship managers or divisional executives) may be present at the meeting.  If the Presidents are unable to resolve the dispute within two (2) days following their initial meeting (or such later date as they may agree), the Parties will be free to exercise such rights and remedies as may be available to them at law or in equity. Any resolution of any dispute reached under this Section 2.8  [Escalation of Certain Disputes] will be reduced to writing and signed by the Parties. During any dispute resolution procedure conducted under this Section, the Parties will diligently perform all obligations hereunder that are not directly related to the dispute.

Section 3.  Promotional Activities

     3.1    Press Releases. The Parties will issue a joint press release promptly upon concluding Advertising. this Agreement, which press release shall be subject to the Party's mutual approval, which shall in any event state that Company is the exclusive provider on the ACSI Site of premium spoken-word audio product for download or streaming over the world wide web. The Parties shall have the right to issue mutually agreeable additional press releases describing the nature of their relationship at such times as the Parties shall mutually agree. Neither Party will issue any other press releases, make any other disclosures regarding this Agreement or its terms or the relationship between the Parties, or use the other Party's Trademarks (except as permitted by Section 6), without the other Party's prior written consent, except that, each Party may, without the other Party's prior consent: (y) distribute or issue public relations materials or press releases that contain a description of the relationship between the Parties, provided that such description has been approved in advance by such other Party (which approval shall not be unreasonably withheld or delayed); and (z) speak in public regarding disclosures made pursuant to the first sentence of this Section 3.1  [Press Releases]. Parties will be able to include a description of this strategic partnership in the company descriptor section of standard releases, subject to initial mutual approvals.

                                      -9-

3.2  Advertising

     3.2.1  Amazon.com Customer Base.   During each Year of the Term following the Launch Date, ACSI (or one of its Affiliates) will deliver Amazon.com-branded e-mails and Amazon.com-branded in-product advertising materials related to the Spoken-Word Audio Sub-Section to selected members of the Amazon.com customer base in at least the following quantities:

---------------------------------------------------------------------------------------------             Year                           Email                      Product Shipment -----------------------------    --------------------------    ------------------------------ ---------------------------------------------------------------------------------------------                                                                        1                            [***]                            [***] ---------------------------------------------------------------------------------------------              2                            [***]                            [***] ---------------------------------------------------------------------------------------------              3                            [***]                            [***] ---------------------------------------------------------------------------------------------

     The Parties shall mutually agree on the nature of such advertising; [***]. With respect to all email advertising, ASCI and Company shall pre-test and plan such advertising in a manner generally consistent with the pre-testing and planning conducted by ACSI and its Affiliates with respect to advertising for other ACSI Product Sub-Sections, with the goal of achieving maximum commercial effectiveness for such advertisements (including, without limitation, by attempting to spread out such advertising in order to not unnecessarily bunch the same).  [***]

     3.2.2  Customer Subscription Emails.   [***]

     3.2.3  Company.  [***]

     3.3    Certain Covenants.  [***]

Source: AUDIBLE INC, 10-Q, 11/13/2000





Section 4.  Implementation

     4.1    Spoken-Word Audio Sub-Section and Mirror Company Site.

            4.1.1  Generally. During the Term, the Parties will cooperate in good faith and use commercially reasonable efforts to provide a seamless customer experience of full interactivity between the Spoken-Word Audio Sub- Section and the Mirror Company Site. The Parties anticipate that the activities contemplated by this Section 4.1.1  [Generally] will be performed in two phases, as set forth in Section 4.1.2  [Implementation] and Section 4.1.3  [Phase II] below.

            4.1.2  Phase I.  Between the Effective Date and the Launch Date, the Parties shall perform such work as may be necessary to develop the Spoken-Word Audio Sub-Section (in the case of ACSI) and the Mirror Company Site (in the case of Company).  Upon the Launch Date, ACSI will establish the Spoken-Word Audio Sub-Section under the browse tree (or equivalent navigation structure) of the Books Product Section, and Company will establish the Mirror Site.  The Spoken- Word Audio Sub-Section will contain, among such

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -10-

other content as may be contained therein pursuant to Section 2.1  [Spoken-Word Audio Sub-Section], multiple hypertext links that will allow users to navigate directly to the Mirror Company Site.

          4.1.3  Phase II. [***], the Parties shall have fully integrated the ACSI Site Functionality into the Mirror Company Site pursuant to specifications and schedules (the Phase II Development Plan) that shall be developed by ACSI in consultation with Company, which specification and schedules shall be attached hereto as Exhibit C, [***].  Any dispute arising related to the creation of the Phase II Development Plan shall be subject to the escalation procedure specified in Section 2.8  [Escalation of Certain Disputes].Without limiting the generality of the foregoing, ACSI and Company will cooperate to implement ACSI Site Functionality for the Spoken-Word Audio Sub-Section (including the Mirror Company Site) in a manner consistent with the ACSI Site Functionality provided in other ACSI Product Sub-Sections, and Company and ACSI will use commercially reasonable efforts to perform, in a timely and professional manner, all technical work necessary to seamlessly integrate the ACSI Site Functionality into the Mirror Company Site, in accordance with the Phase II Development Plan.

          4.1.4  Tax Matters.  [***]

     4.2  ACSI Site Links.  Upon the Launch Date, ACSI will post permanent and/or rotating links to the Home Page of the Spoken-Word Audio Sub-Section on relevant pages of the ACSI Site in a manner substantially similar to and generally consistent with the posting of links to other similar ACSI Product Sub-Sections (e.g., as of the Effective Date, the ACSI Product Sub-Section identified as Audiobooks).  [***]

     The Parties shall consult together in connection with the specific nature, prominence and positioning of the links posted on the ACSI Site pursuant to this Section 4.2  [ACSI Site Links]; [***].

     4.3  Account Managers.  Each Party will assign an account manager (which manager shall be subject to change from time to time by the assigning Party) to oversee the performance of such Party's obligations under this Agreement and to facilitate coordination of the Parties' performance of their respective obligations (including, without limitation, the establishment of the Spoken-Word Audio Sub-Section, the creation of the Co-Branded Pages, the integration of the ACSI Site Functionality with the Mirror Company Site, and the advertising activities contemplated in Section 3).  The account managers will meet from time to time during the Term to review the implementation of this Agreement and to explore methods for improving performance.

     4.4  Regulatory Compliance

          4.4.1  Company will comply, and will ensure that the Mirror Company Site, the Spoken-Word Audio Products and all other activities undertaken through or in connection with the Mirror Company Site and this Agreement (including, without limitation, the participation of ACSI and its Affiliates as contemplated by this Agreement) comply with all applicable Laws.

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.                                      -11-

          4.4.2  Company will provide reasonable assistance to ACSI and ACSI's Affiliates in all regulatory compliance activities required in connection with the advertising, operation, maintenance and sale of Spoken-Word Audio Products on and through the Spoken-Word Audio Sub-Section, including, but not necessarily limited to, assisting ACSI in identifying, obtaining and maintaining in force any and all licenses and permits necessary for ACSI and its Affiliates in connection with any of the foregoing.  In connection with the foregoing regulatory compliance activities, Company will reimburse ACSI for any reasonable costs (including legal costs) incurred by ACSI or its Affiliates in connection with identifying and obtaining any and all such licenses and permits. Notwithstanding the foregoing, ACSI acknowledges and agrees that Company shall have no obligation to assist ACSI in any regulatory compliance activities related to, or reimburse ACSI for any costs incurred by ACSI or its Affiliates in connection with identifying or obtaining any licenses or permits required in connection with, any advertising, operation, maintenance or sale of Spoken-Word Audio Products or other products sold by ACSI or its Affiliates independently through the ACSI Site without the participation of Company.

       4.5  Staffing. Each Party will dedicate during the Term the appropriate resources and personnel necessary for establishment of the Spoken-Word Audio Sub-Section, the integration of the ACSI Site Functionality into the Mirror Company Site and the performance of its other obligations under this Agreement. Each Party's designated employees will be subject to change from time to time by such Party in its sole discretion and promptly upon such change such Party shall

Source: AUDIBLE INC, 10-Q, 11/13/2000





notify the other Party.

Section 5.  Compensation

       5.1  In consideration of the intangible rights granted and services to be performed by ACSI during the Term, Company will pay ACSI the consideration specified in this Section.

       5.2  Annual Fees.

            5.2.1  Upon the Closing, subject to Section 5.3  [Waiver of Payment Obligations], Company will pay ACSI via wire transfer the sum of [***] (the Company Closing Payment), representing payment of the Annual Fee for the first Year of the Term and a pre- payment of the Annual Fee for the second Year of the Term.

            5.2.2  On the first day of Year 3, Company will pay ACSI via wire transfer the sum of [***], representing the Annual Fee payable with respect to Year 3; provided, however, that if ACSI so elects by written notice delivered to Company at least ten (10) days prior to the end of Year 2, Company shall instead issue at the beginning of Year 3 to ACSI  (or such of its Affiliates as it may designate) shares of common stock of Company (or any publicly-traded Affiliate thereof) with a then-current fair market value equal to [***] as of the date of such written notice (the Year 3 Shares).

     5.3    Waiver of Payment Obligations.  At the Closing, the Company Closing Payments due to ACSI pursuant to Section 5.2.1  [Annual Fees] hereof and the Shares Consideration (as defined in the Securities Purchase Agreement) due to the Company pursuant to Section 1.2 of

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.                                      -12-

the Securities Purchase Agreement, which amounts are identical, shall offset each other solely for the purpose of determining the actual fund transfers required at Closing. ASCI acknowledges and agrees that the entire amount of the Company Closing Payments shall be deemed paid and received upon the issuance of the Common Stock (as defined in the Securities Purchase Agreement).

     5.4  Royalties.  In consideration for the intangible rights granted hereunder, for each Year in which the Spoken-Word Audio Sub-Section (including the Mirror Company Site) generates revenue of at [***] (the Revenue Threshold), Company will pay ACSI a royalty equal to [***] of all revenues generated from the Spoken-Word Audio Sub-Section (including, for the avoidance of doubt, any revenue received by Company from any Company customer who first links to the Mirror Company Site from the Spoken-Word Audio Sub-Section and who later accesses the Company Site directly) in excess of Revenue Threshold (the Royalties) for each Year of the Term.  Company will pay ACSI any Royalties payable pursuant to this Section 5.4  [Royalties] on an annual basis, in arrears, as follows: within thirty (30) days after the end of each Year as to which any Royalties are payable, Company will remit to ACSI the Royalties payable with respect to such Year, together with a report specifying in reasonable detail: (a) the gross revenue generated by the Spoken-Word Audio Sub-Section; and (b) Company's calculation of the  Royalties.

     5.5  Overdue Payments.  Payments called for by this Section 5 which are not received within five (5) business days after the date upon which payment is due will bear interest at a rate equal to the lesser of one and one-half percent (1- 1/2%) per month or the maximum legal rate permitted under the controlling Laws. Payment of such interest shall not cure or excuse any breach of any underlying payment obligation.

     5.6  Allocation of Payments.  The Parties acknowledge and agree that the Annual Fees shall be allocated as consideration for advertising services and intangible rights granted by ACSI to Company hereunder, including the rights granted under Section 2.1  [Spoken-Word Audio Sub-Section] and Section 4.2  [ACSI Site Links] and the licenses granted to Company under Section 6, as follows:

             Year                    Advertising Services             Intangible Rights ----------------------------------------------------------------------------------------------                                                                               1                             [***]                           [***] ----------------------------------------------------------------------------------------------               2                             [***]                           [***] ----------------------------------------------------------------------------------------------               3                             [***]                           [***] ----------------------------------------------------------------------------------------------

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -13-

Section 6.  Proprietary Rights

      6.1   Ownership.

            6.1.1  As between the Parties, ACSI reserves all right, title and interest in and to the ACSI Intellectual Property, along with all Intellectual Property Rights associated therewith and no title to or ownership of any of the foregoing is transferred or, except as expressly set forth in Section 6.2  [ACSI License], licensed to Company or any other person or entity pursuant to this Agreement.

            6.1.2  As between the Parties, Company reserves all right, title and interest in and to the Company Intellectual Property, along with all Intellectual Property Rights associated therewith and no title to or ownership of any of the foregoing is transferred or, except as expressly set forth in Section 6.3  [Company License], licensed to ACSI or any other person or entity pursuant to this Agreement.

Source: AUDIBLE INC, 10-Q, 11/13/2000





            6.1.3  To the maximum extent permitted by applicable Laws, any ACSI Derivative Works or Company Derivative Works, to the extent created by or for the other Party, shall be deemed works made for hire, and all right, title and interest therein shall vest in ACSI (in the case of ACSI Derivative Works) or Company (in the case of Company Derivative Works) immediately upon creation thereof. To the extent that any such ACSI Derivative Works or Company Derivative Works are not works made for hire, Company hereby assigns and agrees to assign to ACSI (or such of its Affiliates as it may designate) all right, title and interest to all ACSI Derivative Works and all associated Intellectual Property Rights, and ACSI hereby assigns and agrees to assign to Company (or such of its Affiliates as it may designate) all right, title and interest in and to all Company Derivative Works and all associated Intellectual Property Rights. Each Party shall take, at the other Party's expense, any actions (including, without limitation, execution and delivery of affidavits and other documents) reasonably requested by such other Party to effect, perfect or confirm its or its designee's ownership rights as set forth in this Section 6.1.3  [Ownership].

            6.1.4  To the extent that any Joint Works are created in the course of performance of this Agreement, each Party shall own a joint, equal and undivided ownership interest in and to such Joint Works and the associated Intellectual Property Rights, with no duty on the part of either Party to account to the other with respect to its use and exploitation of the same. Each Party shall own all right, title and interest in and to any Derivative Works of any Joint Works created by or for such Party and all Intellectual Property Rights associated therewith (to the extent not also associated with the Joint Works). Without limiting the generality of the foregoing, either Party may, without any duty to account to the other (including, without limitation, any duty to pay, share or account for any royalties):

          (a) make, manufacture, assemble, produce, market, sell, distribute,      transfer, use, license and otherwise commercially and non-commercially      exploit and deal with the Joint Works; provided, that neither Party shall      seek or obtain any

                                     -14-

     registration of any Intellectual Property Rights associated with the Joint      Works without the other Party's prior written consent;

          (b) make, manufacture, assemble, produce, market, sell, distribute,      transfer, use, license, seek and obtain registrations of Intellectual      Property Rights (subject to paragraph (a) above) and otherwise commercially      and non-commercially exploit and deal with Derivative Works of any Joint      Works created by or for such Party, whether or not competitive with any      items created by or for the other Party; and

          (c) authorize any third party to take any action described in (a) or      (b) above.

     6.2  ACSI License.  ACSI hereby grants to Company, during the Term, a non- exclusive, non-transferable (except in accordance with Section 11.7  [Assignment]) license, which Company may sublicense only to its Affiliates, to use the ACSI Intellectual Property supplied by ACSI to Company as is reasonably necessary to perform its obligations under this Agreement; provided, however, that Company shall not use ACSI's Trademarks, including in any advertising, without ACSI's prior written consent, unless such use conforms to a written Trademark use policy previously furnished by ACSI to Company and not subsequently modified or revoked.  All goodwill arising out of any use of any of ACSI's or its Affiliates' Trademarks by, through or under Company will inure solely to the benefit of ACSI and its Affiliates.

     6.3  Company License.  Company hereby grants to ACSI, during the Term, a non-exclusive, non-transferable (except in accordance with Section 11.7  [Assignment]) license, which ACSI may sublicense only to its Affiliates, to use the Company Intellectual Property supplied by Company to ACSI as is reasonably necessary to perform its obligations under this Agreement; provided, however, that ACSI shall not use Company's Trademarks, including in any advertising, without Company's prior written consent, unless such use conforms to a written Trademark use policy previously furnished by Company to ACSI and not subsequently modified or revoked.  All goodwill arising out of any use of any of Company's Trademarks by, through or under ACSI will inure solely to the benefit of Company.

     6.4  Non-Disparagement.  Neither Company nor ACSI will use the other Party's Trademarks in a manner that disparages the other Party or its products or services, and/or portrays the other Party or its products or services in a false, competitively adverse or poor light.  Each of Company and ACSI will comply with the other Party's requests as to the use of the other Party's Trademarks and will avoid knowingly taking any action that diminishes the value of such Trademarks.

Section 7.  Representations; Indemnity

     7.1  Representations.  Each Party represents and warrants to the other that: (a) it has the full corporate right, power and authority to enter into this Agreement and perform its obligations hereunder; (b) its performance of this Agreement, and the other Party's exercise of such other Party's rights under this Agreement, will not conflict with or result in a breach

                                     -15-

or violation of any of the terms or provisions or constitute a default under any agreement by which it is bound; (c) when executed and delivered, this Agreement will constitute its legal, valid and binding obligation enforceable against it in accordance with its terms; and (d) it will comply with all applicable Laws in its performance of this Agreement.

     7.2  Indemnity.  Each Party (as applicable, the Indemnifying Party) will defend, indemnify and hold harmless the other Party (the Indemnified Party) and its Affiliates (and their respective employees, directors and representatives) from and against any and all claims, costs, losses, damages, judgments and expenses (including reasonable attorneys' fees) arising out of any Claim, to the extent it is based on (a) the operation or content of the Indemnifying Party's Site (other than any items or materials supplied, or operation or content required, by the Indemnified Party), (b) the offer, marketing or sale of any products or services through the Indemnifying Party's Site (other than any products offered, marketed or sold by the Indemnified Party

Source: AUDIBLE INC, 10-Q, 11/13/2000





through such Site, the Parties acknowledging that Company shall be deemed the Indemnifying Party as to any Claim related to any products offered, marketed or sold by Company through the Spoken-Word Audio Sub-Section and/or Mirror Company Site, except to the extent that such Claim relates to any ACSI Site Functionality or other items or content provided by or for ACSI with respect to the Spoken-Word Audio Sub-Section and/or Mirror Company Site), (c) any actual or alleged breach of the Indemnifying Party's representations or warranties set forth in Section 7.1  [Representations] above, or, in the case of Company, its obligations under Section 4.4  [Regulatory Compliance]  above, or (d) any actual or alleged infringement of any Intellectual Property Rights by any content, items or materials provided by the Indemnifying Party to the Indemnified Party for its use under this Agreement. Subject to Section 7.3  [Procedure], the Indemnifying Party will pay any award against the Indemnified Party and its Affiliates (and their respective employees, directors or representatives) and any costs and attorneys' fees reasonably incurred by them resulting from any such Claim.

     7.3  Procedure.  In connection with any Claim described in this Section 7, the Indemnified Party will (a) give the Indemnifying Party prompt written notice of the Claim, (b) cooperate with the Indemnifying Party (at the Indemnifying Party's expense) in connection with the defense and settlement of the Claim, and (c) permit the Indemnifying Party to control the defense and settlement of the Claim, provided that the Indemnifying Party may not settle the Claim without the Indemnified Party's prior written consent (which will not be unreasonably withheld).  Further, the Indemnified Party (at its cost) may participate in the defense and settlement of the Claim with counsel of its own choosing.  Unless the Indemnifying Party notifies the Indemnified Party in writing within five (5) days of its receipt of notice of any Claim that it irrevocably elects not to assume the defense of such Claim, the Indemnifying Party shall be deemed to have elected to assume the defense of such Claim.  If the Indemnifying Party elects not to assume the defense of any Claim, or having assumed the defense of any Claim fails to pursue diligently the defense thereof, the Indemnifying Party shall be deemed to have irrevocably waived any right to participate in or control the defense or settlement of such Claim and the Indemnified Party shall be entitled to sole control of the defense and settlement of such Claim (without limitation of the Indemnifying Party's indemnity obligations under this Section 7).

                                     -16-

Section 8.  Disclaimers, Limitations and Reservations

     8.1  DISCLAIMER OF WARRANTIES.  EXCEPT AS PROVIDED IN SECTION 7.1  [Representations] ABOVE, NEITHER PARTY MAKES, AND EACH PARTY HEREBY WAIVES AND DISCLAIMS, ANY REPRESENTATIONS OR WARRANTIES REGARDING THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING (WITHOUT LIMITATION) ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OR IMPLIED WARRANTIES ARISING OUT OF COURSE OF DEALING, COURSE OF PERFORMANCE OR USAGE OF TRADE.  WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, EACH PARTY SPECIFICALLY DISCLAIMS ANY REPRESENTATION OR WARRANTY REGARDING (A) THE AMOUNT OF SALES REVENUES THAT MAY OCCUR DURING THE TERM, AND (B) ANY ECONOMIC OR OTHER BENEFIT THAT THEY MIGHT OBTAIN THROUGH ITS PARTICIPATION IN THIS AGREEMENT (OTHER THAN THE SPECIFIC SUMS TO BE PAID PURSUANT TO THIS AGREEMENT).

     8.2  No Consequential Damages.  EXCEPT TO THE EXTENT AWARDED TO A THIRD PARTY IN A JUDGMENT AGAINST WHICH A PARTY IS ENTITLED TO INDEMNIFICATION PURSUANT TO SECTION 7.2  [Indemnity], OR TO THE EXTENT ARISING OUT OF ANY BREACH OF SECTION 11.4  [Nondisclosure], NEITHER PARTY WILL BE LIABLE (WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING, BUT NOT LIMITED TO, NEGLIGENCE), PRODUCT LIABILITY OR OTHER THEORY), TO THE OTHER PARTY OR ANY OTHER PERSON OR ENTITY FOR COST OF COVER OR FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT LIMITATION DAMAGES FOR LOSS OF PROFIT, REVENUE, BUSINESS OR DATA) ARISING OUT OF THIS AGREEMENT, EVEN IF SUCH PARTY HAS BEEN ADVISEDOF THE POSSIBILITY OF SUCH COSTS OR DAMAGES.  FOR THE AVOIDANCE OF DOUBT, THE PARTIES HEREBY ACKNOWLEDGE AND AGREE THAT NOTHING IN THIS SECTION 8.2  [No Consequential Damages] IS INTENDED TO LIMIT ANY RIGHT OF ACSI TO RECEIVE LIQUIDATED DAMAGES AS SET FORTH IN SECTION 10.5.2  [Effect of Termination].

     8.3  Limitation of Damages. EXCEPT FOR LIABILITIES UNDER SECTION 7.2  [Indemnity], NEITHER PARTY'S AGGREGATE LIABILITY ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), WARRANTY OR OTHERWISE, SHALL EXCEED [***].

     8.4  Third Party Infringement Claims. In the event that either Party receives from a third party a bona fide claim of infringement concerning any advertising materials or other content supplied by the other Party, such Party may immediately remove such materials

--------- *** Confidential Information has been omitted and has been filed separately with     the Securities and Exchange Commission.

                                     -17-

or content from its Web Site at its sole discretion, pending receipt of non- infringing replacement materials or content or satisfactory resolution of such claim, and any such removal shall not constitute a breach of this Agreement.

Section 9.  Exclusivity.

     9.1    ACSI

            9.1.1 Exclusive Spoken-Word Audio Products. During the Term, [***], ACSI will not offer or sell through the ACSI Site, or authorize any third party to sell through the ACSI Site, any Exclusive Spoken-Word Audio Products; [***].

            9.1.2 [***]

     9.2    [***]

     9.3    [***]

     9.4    Records; Audit. Each Party will, during the Term and for a period of one (1) year thereafter, maintain complete and accurate books and records sufficient to verify its compliance or non-compliance with the provisions of this Section 9 (and, in the case of Company, Section 5.4  [Royalties]). Each Party (the Audited Party') will, upon at least thirty (30) days' prior written request by the other Party (the Auditing Party), allow an independent certified public

Source: AUDIBLE INC, 10-Q, 11/13/2000





accounting firm selected by the Auditing Party and reasonably acceptable to the Audited Party to audit such books and records at the Audited Party's premises to the extent necessary to verify the Audited Party's compliance or non-compliance with the provisions of this Section 9 (or, in the case of Company, Section 5.4  [Royalties]); provided, that: (a) any such audit is conducted during normal business hours and in a manner designed to not unreasonably interfere with the Audited Party's ordinary business operations; (b) audits may not occur more frequently than once every twelve (12) months; and (c) each such audit may only cover the period commencing after the period covered by the last audit conducted pursuant to this Section, if any. The Auditing Party agrees that any information learned or disclosed by its auditor in connection with such audit is Confidential Information of the Audited Party. If any such audit reveals any material non- compliance with the provisions of this Section 9 by the Audited Party, the Audited Party shall, within ten (10) days of its receipt of an invoice therefor, reimburse the Auditing Party for all reasonable out-of-pocket fees and expenses incurred by the Auditing Party in connection with the applicable audit. If any such audit reveals any underpayment of any sums payable pursuant to Section 5.4  [Royalties], Company will promptly remit to ACSI the amount of the underpayment; and, if the amount of such underpayment is five percent (5%) or more for any audited period, Company shall, within ten (10) days of its receipt of an invoice therefor, reimburse ACSI for all reasonable out-of-pocket fees and expenses incurred by ACSI and its Affiliates in connection with the applicable audit together with interest on any underpayment as provided in Section 5.5  [Overdue Payments].

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -18-

Section 10.  Term and Termination

     10.1    Term.  The term of this Agreement will commence on the Effective Date, and unless earlier terminated as provided elsewhere in this Agreement, will end automatically upon the end of Year 3.

     10.2    Termination for Breach.  Without limiting any other rights or remedies (including, without limitation, any right to seek damages and other monetary relief and ACSI's rights under Section 10.3  [ACSI Termination] or Company's rights under Section 10.4  [Company Termination]) that either Party may have in law or otherwise, either Party may terminate this Agreement if the other Party materially breaches its obligations hereunder, provided that, except as provided in Section 10.3  [ACSI Termination] and 10.4  [Company Termination], (a) the non-breaching Party sends written notice to the breaching Party describing the breach, and (b) the breaching Party does not cure the breach within thirty (30) days following its receipt of such notice; provided further, however, that without limitation of ACSI's rights under Section 10.3  [ACSI Termination] if the conditions set forth in that Section are satisfied, in the event of any failure by Company to comply with the customer service requirements specified in Section 2.4  [Technical Standards; Customer Service] and Exhibit B, ACSI shall only be entitled to terminate this Agreement by reason of such failure if it is material, ACSI has notified Company of such non-compliance and Company has not come into compliance with such requirements within sixty (60) days from the date of the non-breaching Party's notice.

     10.3    ACSI Termination. In the event that: (a) Company at any time engages in any criminal conduct, fraud, dishonesty or other behavior that is materially harming the goodwill or reputation of ACSI or its Affiliates or the ACSI Site; (b) Company has consistently failed to abide by the technical and customer service requirements described in Section 2.4  [Technical Standards; Customer Service] or has failed to integrate the ACSI Site Functionality into the Spoken-Word Audio Sub-Section and/or Mirror Company Site as required by the Phase II Development Plan (so long as such failure is not a result of acts or omissions by ACSI); or (c) Company consistently fails to pay bona fide debts as they legally come due, institutes or has instituted against it any bankruptcy, reorganization, debt arrangement, assignment for the benefit of creditors, or other proceeding under any bankruptcy or insolvency Law or dissolution, receivership, or liquidation proceeding (and, if such proceeding is instituted against it, such proceeding is not dismissed within one hundred twenty (120) days), the same shall be deemed a material breach of this Agreement which is not susceptible to cure, and ACSI shall be entitled to terminate this Agreement upon written notice to Company. [***]

     10.4    Company Termination.  In the event that (a) ACSI has failed to integrate the ACSI Site Functionality into the Spoken-Word Audio Sub-Section and/or Mirror Company Site as required by the Phase II Development Plan (so long as such failure is not a result of acts or omissions by Company); or (b) ACSI consistently fails to pay its bona fide debts as they legally come due, institutes or has instituted against it any bankruptcy, reorganization, debt arrangement, assignment for the benefit of creditors, or other proceeding under any bankruptcy or insolvency Law or dissolution, receivership, or liquidation proceeding (and, if such proceeding is instituted against it, such proceeding is not dismissed within one hundred twenty (120) days), the same shall be deemed a material breach of this Agreement which is

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -19-

not susceptible to cure, and Company shall be entitled to terminate this Agreement upon written notice to ACSI.

     10.5  Effect of Termination.

           10.5.1  General.  Upon termination of this Agreement, each Party in receipt, possession or control of the other Party's intellectual or proprietary property, information and materials (including any Confidential Information) pursuant to this Agreement must return to the other Party (or at the other Party's written request, destroy and certify in writing such destruction) such property, information and materials.  In addition, except as provided in Section 10.5.2  [Effect of Termination], Company will promptly upon any termination of this Agreement pay to ACSI a prorated portion of the Annual Fee due for the Year in which termination is effective; provided, however, that if Company terminates this Agreement by reason of ACSI's breach hereof, Company shall have no further payment obligation, and, if such termination occurs at any time during the Refund

Source: AUDIBLE INC, 10-Q, 11/13/2000





Period, ACSI shall promptly either (a) refund to Company a percentage of the Annual Fees paid pursuant to Section 5.2.1  [Annual Fees] equal to the Proration Percentage, or, at ACSI's option, (b) cause the transfer and assignment to Company of a percentage of the Shares delivered pursuant to Section 5.3  [Waiver of Payment Obligations] equal to the Proration Percentage.  Sections 6 through 8, 10 and 11 will survive the termination or expiration of this Agreement.

           10.5.2  [***]

           10.5.3  Construction by Court.  To the extent that any court of competent jurisdiction determines that any provision of Section 10.5.2  [Effect of Termination] is for any reason unlawful, invalid, in violation of public policy or otherwise unenforceable in whole or in part, such provision shall be narrowed in scope to the extent necessary to make the same lawful, valid and enforceable while as nearly as possible reflecting the intent of the Parties as expressed in this Agreement.

           10.5.4  User Transition.  Upon any termination or expiration of the Term the Parties will cooperate in good faith to promote a smooth customer transition, and in any event, Company will, at ACSI's option, continue to operate the Mirror Company Site and offer Spoken-Word Audio Products through the Spoken-Word Audio Sub-Section in accordance with the terms of this Agreement for a period of up to six (6) months following such termination.

           10.5.5  Phase II Development Plan.  Notwithstanding any other provision of this Agreement, the Parties acknowledge and agree that no failure by the Parties to develop the Phase II Development Plan as contemplated by Section 4.1.3  [Phase II] shall be deemed, in itself, a breach of this Agreement by either Party (and therefore that such occurrence shall not, in itself, give rise to any of the remedies specified in Section 10.5.1  [General] or Section 10.5.2  [Effect of Termination]).

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -20-

Section  11.  Miscellaneous

      11.1    Tax Treatment.

              11.1.1  The Parties acknowledge and agree that this Agreement and the transactions contemplated hereby are not intended to create any jurisdiction or authority for any governmental authority to impose any obligation to collect any sales tax, use tax or similar tax in connection with any sales of products by either Party or its Affiliates. Accordingly, each Party agrees to take such action as the other Party may reasonably request (including, without limitation, execution of affidavits and other documents) to avoid or curtail the imposition, by reason of this Agreement or the transactions contemplated hereby, of any such obligation on such Party or its Affiliates, or the establishment of a nexus for tax purposes sufficient to grant any jurisdiction the authority to levy any sales tax, use tax or similar tax on sales of products by such Party or its Affiliates in connection with this Agreement; provided, however, that nothing in this Section 11.1.1  [Tax Treatment] shall limit Company's obligations under Section 11.1.2  [Tax Treatment].

              11.1.2  Company will collect and pay, and indemnify and hold harmless ACSI and its Affiliates from, any sales, use, excise, import or export, value added or similar tax or duty not based on ACSI's or its Affiliates' net income, including penalties and interest, costs associated with the collection and withholding thereof and attorneys fees in connection therewith, arising out of or in connection with this Agreement or Company's advertisement, offer or sale of any products.

     11.2     Insurance.  Company will at its expense, prior to the Launch Date obtain, and thereafter throughout the Term and for a period of six (6) months thereafter maintain, such policy or policies of insurance as is commercially reasonable for the transactions and business contemplated by this Agreement. Without limiting the generality of the foregoing, Company will ensure that such policies contain a waiver of subrogation against ACSI, name ACSI and its assignees as additional insureds.  Company will not modify or terminate any coverage without giving at least thirty (30) days' prior written notice to ACSI. Upon request from ACSI, Company will furnish to ACSI certificates of insurance and such other documentation relating to such policies as ACSI may reasonably request.

     11.3     Independent Contractors. The Parties are entering this Agreement as independent contractors, and this Agreement will not be construed to create a partnership, joint venture or employment relationship between them. Neither Party will represent itself to be an employee or agent of the other or enter into any agreement or legally binding commitment or statement on the other's behalf of or in the other's name.

     11.4     Nondisclosure. Each Party will protect the Confidential Information of the other Party from misappropriation and unauthorized use or disclosure, and at a minimum, will take precautions at least as great as those taken to protect its own confidential information of a similar nature, but in no event with less than reasonable care. Without limiting the foregoing, the Receiving Party will: (a) use such Confidential Information solely for the purposes for which it has been disclosed; and (b) disclose such Confidential

                                     -21-

Information only to those of its and its Affiliates' employees, agents, and consultants who have a need to know the same for the purpose of performing this Agreement and who are informed of and agree to a duty of nondisclosure. The Receiving Party may also disclose Confidential Information of the Disclosing Party to the extent necessary to comply with applicable Law or legal process or pursuant to a registration report or exhibits thereto filed or to be filed with the Securities and Exchange Commission, listing agency or any stock securities commission, or any other associated filings, provided that the Receiving Party uses gives the Disclosing Party not less than ten (10) days' prior written notice thereof and complies with all reasonable requests of the Disclosing Party to minimize the extent or scope of any such disclosure. Upon request of the other Party, or in any event upon any termination or expiration of the Term, each Party shall return to the other or destroy (and certify in writing such destruction) all materials, in any medium, which contain, embody, reflect or

Source: AUDIBLE INC, 10-Q, 11/13/2000





reference all or any part of any Confidential Information of the other Party.

     11.5     Costs.  Except as expressly provided herein, each Party will be responsible for all costs and expenses incurred by it in connection with the negotiation, execution, delivery and performance of this Agreement.

     11.6     Notices.  Any notice or other communication under this Agreement given by either Party to the other Party will be in writing and, to be effective, must be sent to the intended recipient by prepaid registered letter, receipted commercial courier, or electronically receipted facsimile transmission (acknowledged in like manner by the intended recipient) at its address specified below its signature at the end of this Agreement, and in the case of ACSI, with a copy to Amazon.com, Inc., 1200 12th Avenue South, Suite 1200, Seattle, WA 98144, USA, Facsimile: (206) 266-7010 Attn: General Counsel and in the case of Company, with a copy to Audible Inc., Facsimile 973-890-0178, Attn: Vice President, Business & Legal Affairs; provided, that no notice of  termination of this Agreement shall be deemed properly given unless sent by prepaid registered mail to such address(es) and to the attention of such officer(s).  Either Party may from time to time change such address or individual by giving the other Party notice of such change in accordance with this Section 11.6  [Notices].

     11.7     Assignment. Company may not assign or delegate this Agreement or any of its rights or obligations hereunder, whether voluntarily, involuntarily, by operation of Law or otherwise, without ACSI's prior written consent, which consent shall not be unreasonably withheld or delayed, except that Company may assign this Agreement to any direct or indirect wholly owned subsidiary in connection with any corporate reorganization undertaken for the purpose of minimizing the tax liability of Company and its Affiliates or other bona fide corporate purpose or in connection with any Change of Control [***]. Subject to the preceding two sentences, this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their successors and assigns. ACSI may assign this Agreement to (a) any corporation or other entity resulting from any merger, consolidation, or other reorganization involving ACSI, (b) any of its Affiliates, or (c) any person or entity to which it transfers all or

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -22-

substantially all of its assets relating to the Spoken-Word Audio Sub-Section; provided that the assignee agrees in writing to be bound by all the terms and conditions of this Agreement.  Subject to the foregoing, this Agreement will be binding on and enforceable by the Parties and their respective successors and permitted assigns.

     11.8     Nonwaiver.  To be effective, any waiver by a Party of any of its rights or the other Party's obligations under this Agreement must be made in a writing signed by the Party to be charged with the waiver.  No failure or forbearance by either Party to insist upon or enforce performance by the other Party of any of the provisions of this Agreement or to exercise any rights or remedies under this Agreement or otherwise at law or in equity shall be construed as a waiver or relinquishment to any extent of such Party's right to assert or rely upon any such provision, right, or remedy in that or any other instance; rather the same shall be and remain in full force and effect.

     11.9     Counterparts; Transmitted Copies. This Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of which taken together will constitute one and the same instrument. To expedite the process of entering into this Agreement, the Parties acknowledge that Transmitted Copies of the Agreement shall be equivalent to original documents until such time (if any) as original documents are completely executed and delivered. Transmitted Copies shall mean copies which are reproduced or transmitted via facsimile, or another process of complete and accurate reproduction and transmission.

     11.10    Headings.  The headings of sections and subsections of this Agreement are for convenience of reference only and are not intended to restrict, affect or otherwise influence the interpretation or construction of any provision of this Agreement.

     11.11    Choice of Law.  This Agreement will be interpreted, construed and enforced in accordance with the Laws of the State of Washington, without reference to its choice of Laws rules.

     11.12    Venue.  Company hereby irrevocably consents to non-exclusive personal jurisdiction and venue in the state and federal courts located in King County, Washington, with respect to any claim, action or proceeding arising out of or related to this Agreement and agrees not to commence or prosecute any such claim, action or proceeding other than in the aforementioned courts.

     11.13    Entire Agreement.  This Agreement (a) represents the entire agreement between the Parties with respect to the subject matter hereof and supersedes any previous or contemporaneous oral or written agreements regarding such subject matter and (b) may be amended or modified only by a written instrument signed by a duly authorized agent of each Party.  No breach of this Agreement by either Party shall affect the rights or obligations of either Party under any other Agreement between the Parties; rather, the same will remain in full force and effect.

                                     -23-

ACSI                                     Company: ----                                     --------

Amazon.com Commerce Services, Inc.       Audible Inc.

 /s/                                      /s/ Don Katz ----------------------------------       -------------------------------------- By (Sign)                                By (Sign)

Vice President                           Founder, Chairman, Acting CEO ----------------------------------       -------------------------------------- Title                                    Title

Source: AUDIBLE INC, 10-Q, 11/13/2000





1/30/2000                                1/30/2000 ----------------------------------       -------------------------------------- Date                                     Date

Notice Address:                          Notice Address:

[***]                                    [***]

--------------- ***Confidential Information has been omitted and has been filed separately with the Securities and Exchange Commission.

                                     -24-

Source: AUDIBLE INC, 10-Q, 11/13/2000

Ex Output:

Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?