In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.
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Question: Exhibit 10.1   COLLABORATION AGREEMENT   THIS COLLABORATION AGREEMENT   (Agreement) is made as of this 18t h day of August 2014 (the Effective Date), by and between Capsugel US, LLC and its Affiliates with an address at 412 Mt. Kemble Ave, Suite 200C, Morristown, NJ 07960 ( CAPSUGEL) and Cardax, Inc., and its Affiliates, with a corporate address at 2800 Woodlawn Dr., Suite 129, Honolulu, HI 96822 (CARDAX). CARDAX and CAPSUGEL are each a Party and together constitute the Parties   RECITALS   WHEREAS, CAPSUGEL is experienced in formulating, developing, manufacturing, testing and packaging of health and nutrition products; and   WHEREAS, CARDAX is experienced in developing products that are based on its astaxanthin technologies; and   WHEREAS, CAPSUGEL and CARDAX desire to enter into an arrangement under which the Product (as defined below) will be formulated and developed for the purpose of identifying a marketing partner(s) (Marketer) for Marketer's onward sale of the Product in the Territory.   NOW, THEREFORE, the Parties hereto agree to the following:   SECTION 1   DEFINITIONS   The following terms for the purpose of this Agreement shall have the following respective meanings:   1.1 Active Ingredient shall mean the synthetic Astaxanthin and/or esters thereof that will be formulated in the Product as the active ingredient of the Product.   1.2 Adjusted Net Sales shall mean [***].   1.3 Administrative Cost shall mean [***].   1.4 Affiliate shall mean, with respect to either Party, all entities which, directly or indirectly, are controlled by, control or are under common control with such Party. For purposes of this Agreement, the word control shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, including through ownership of more than fifty percent (50%) of the voting shares or interest of an entity; provided, however, with respect to CAPSUGEL, the term Affiliate shall be limited to entities who directly or indirectly through one or more intermediaries are controlled by the parent of CAPSUGEL's direct parent entity and with respect to CARDAX the term Affiliate shall not include Cardax Pharmaceuticals, Inc.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 1





    1.5 Applicable Laws shall mean all applicable laws, statutes, ordinances, codes, rules and regulations applicable to the formulation, development and/or manufacture, marketing, distribution sale, and disposal of the Product or any aspect thereof and the obligations of CAPSUGEL or CARDAX, as the context requires under this Agreement.   1.6 Annual Period shall mean the twelve (12) month period beginning on the first day in which the Launch Date occurs and each twelve (12) month period beginning on the anniversary of such day thereafter.   1.7 Commercially Reasonable Efforts means a Party's reasonable efforts and diligence, consistent with professional business standards generally practiced in the health and nutrition industry, applied in accordance with the Party's commercially reasonable business, legal, medical and scientific judgment, including the efforts and resources the Party would use for a product owned by it or to which it has rights, which is of similar market potential at a similar stage in its product life, taking into account the competitiveness of the marketplace, the proprietary position of the compound, the Applicable Laws, the profitability of the applicable products, and other relevant factors including, without limitation, technical, legal, scientific or medical factors.   1.8 Development Plan shall have the meaning set forth in Section 2.1.   1.9 Disclosing Party shall have the meaning set forth in the Confidentiality Agreement.   1.10 Formulation means a specific combination of excipient(s) that can formulate the Active Ingredient, as well as compounds other than the Active Ingredient, developed as a result of the work conducted under the Development Plan.   1.11 Force Majeure shall have the meaning set forth in Section 10.5.   1.12 Indemnified Party shall have the meaning set forth in Section 8.3.   1.13 Indemnifying Party shall have the meaning set forth in Section 8.3.   1.14 Intellectual Property Rights means a composition of matter, formula, process, method of use, invention, improvement, business name, domain name or database right to the extent any of the foregoing is protected in a utility model, trademark, service mark, trade name or business name, copyright, registered design, design right, patent, know-how, trade secret, rights in or to confidential information all goodwill related thereto and any other intellectual property right of any nature whatsoever throughout the world (whether registered or unregistered and including all applications and rights to apply for the same).   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 2





    1.15 Launch Date shall mean the date [***].   1.16 Loss or Losses shall mean any and all damages, fines, fees, settlements, payments, obligations, penalties, deficiencies, losses, costs and expenses, including, without limitation, environmental losses, interest, court costs, reasonable fees of attorneys, accountants and other experts and other reasonable expenses of litigation or other proceedings or of any claim, default or assessment.   1.17 Manufacturing Facility shall mean those areas of CAPSUGEL or CAPSUGEL's subcontractors manufacturing, packaging, laboratory and warehousing facilities utilized in the formulation, manufacture, packaging, storage, testing, shipping or receiving of the Product.   1.18 Materials mean all excipient(s) and inactive raw materials used in the formulation of the Product. For the avoidance of doubt, Materials does not include any Active Ingredient or work in process or finished goods inventory.   1.19 Net Sales means [***].   1.20 Product shall mean Active Ingredient Formulated in CAPSUGEL's proprietary Lipid Multi-Particulate Technology, including any improvements or derivatives of such technology.   1.21 Receiving Party shall have the meaning set forth in the Confidentiality Agreement.   1.22 Regulatory Approvals means any and all approvals, licenses, registrations, or authorizations of the relevant Regulatory Authority, necessary for the development, manufacture, use, storage, import, transport, export or commercialization of the Product in a particular country or jurisdiction.   1.23 Regulatory Authority (ies) means any governmental regulatory authority within a Territory involved in regulating any aspect of the development, manufacture, testing, market approval, sale, distribution, packaging or use of the Product.   1.24 Regulatory Filings shall mean the registrations, permits, licenses, authorizations, presentations, notifications, filings and/or approvals (together with all applications therefore and all related documents required by the FDA and all other laws for the development, manufacture, use, importation, export, marketing, sale and distribution of the Product within the Territory.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 3





    1.25 Royalty Payment shall have the meaning set forth in Section 5.1.   1.26 Specifications shall mean the Product description and attributes agreed upon between the Parties upon conclusion of the Development Plan and appended to this Agreement as Exhibit B that will be attached hereto and, when attached, will be a part hereof, prior to commercialization of the Product.   1.27 Territory shall mean worldwide.   Section 2   Product Development, Manufacture and Commercialization   2.1 Governance Process Among the Parties . Both CARDAX and CAPSUGEL will agree upon a development plan, which shall be in writing and attached hereto as Exhibit A (the Development Plan), which shall describe various parameters including each Party's duties, obligations, time schedule and deliverables schedule. The activities performed under the Development Plan (the Development Activities)  shall  be administered by a joint project team (JPT), which shall review/update/amend the Development Plan for the Product in the Territory and coordinate the Formulation, development, manufacturing and commercialization of the Product, including identifying and selecting one or more Marketers as contemplated under Section 2.4. Each Party shall appoint a project manager to oversee that Party's performance of its obligations under this Agreement and shall notify the other Party of the name and full contact details of its appointed project manager. The  JPT shall comply with this Agreement for decisions specifically assigned to a Party pursuant to this Agreement. Meetings shall  take place by telephone or in person and the JPT will operate by consensus. If consensus cannot be reached, the matter will be submitted to the Head of Dosage Form Solutions of CAPSUGEL and the President and CEO of CARDAX for resolution. If such matter is not resolved, then the Parties may attempt to mediate such issue under the JAMS mediation rules. No member or any Affiliate of any member of the JPT shall have any liability under this Agreement and shall be exculpated to the fullest extent not prohibited by law from any liability to any Party that such member is not an employee, officer, consultant or acting in any similar capacity.     2.2 CAPSUGEL Responsibilities. With respect to the Product, CAPSUGEL, [***] shall [***] perform the development work necessary to formulate, analytically develop and take all other developmental actions necessary or required to develop the Product and manufacture pre- clinical and clinical batches (collectively, the CAPSUGEL Development Activities ). For purposes of further clarification, CAPSUGEL Development Activities shall include, without limitation, each of the following performed with all due diligence, care and skill and in accordance with all other Applicable Laws:

CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 4







  (a) Formulation Development. Formulation shall mean a specific combination of Materials that formulate the Active Ingredient, as well as compounds other than the Active Ingredient, developed as a result of the work conducted under the Development Plan. The development of the Formulation of the Product, includes without limitation, all stability tests and other studies as applicable, providing CARDAX reports of such stability tests, using Commercially Reasonable Efforts to modify the Formulation as necessary and develop processes capable of scale-up and commercialization in accordance with Applicable Laws.         (b) Analytical Methods. Developing and validating analytical methods including but not limited to dissolution, assay, and stability as agreed upon by the Parties.         (c) Manufacture of Study Batches. The manufacture [***] of batches of Product in amounts specified on or about the dates determined a s  reasonably necessary for conducting all required for CAPSUGEL/CARDAX funded studies. Any other batches required or reasonably required by the Marketer for applying for and all actions related to additional Regulatory Approvals and Regulatory Filings of the Product and any related communications, studies or support for the FDA or any other Regulatory Authority (ies), which may include human and animal studies, shall be paid for by the Marketer, unless the Parties agree otherwise.         (d) Manufacturing Development. Development of manufacturing processes and systems in conformance with cGMP requirements of FDA to manufacture pilot batches, exhibit batches and commercial batches of Product.         (e) Reporting.  CAPSUGEL shall, throughout the performance of the Development Plan studies, consult with CARDAX on matters including technical, intellectual property and regulatory aspects and keep the other apprised of all developments.         (f) Commercial Manufacturing. CAPSUGEL shall manufacture the Product for each Marketer unless otherwise agreed by the Parties and the applicable Marketer.

2.3 CARDAX Responsibilities.

  (a) CARDAX shall be responsible for [***] the Active Ingredient [***], subject to reasonable notice and delivery schedules and reasonable amounts required by CAPSUGEL for it to perform its obligations under this Agreement or as otherwise agreed by CARDAX.         (b) [***]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 5





    2.4 Joint Responsibilities.

[***]   The marketing of the Product shall be carried out by one or more mutually identified Marketer(s) by the JPT or otherwise in accordance with Section 2.1. CAPSUGEL and CARDAX will jointly control identification, decision rights, and terms for a Marketer as determined by the JPT or otherwise in accordance with Section 2.1. If a Marketer is not identified, or the terms are not determined, by the JPT or otherwise in accordance with Section 2.1, then the Marketer (and such terms) may be designated by either Party, subject to the reasonable approval of the other Party.    Any additional costs/activities required from a Marketer will be subject to agreement of the JPT or otherwise as provided in Section 2.1, including but not limited to pre-launch out-of-pocket expenses and the funding of such costs and expenses. These costs will be shared [***].   2.5 Ownership of Application. CARDAX shall own and control all information and rights in, to and under all Regulatory Approvals in the Territory (including all associated contents and correspondences) and applications therefore related to the Product and any other marketing authorizations within the Territory, unless otherwise mutually agreed upon by the Parties.

Section 3   Intellectual Property Matters   3.1 Background IP. This Agreement shall not change, modify or otherwise affect any rights to any confidential information, inventions, patents, patent applications or other Intellectual Property Rights owned or developed by either Party before the Effective Date or developed by a Party after the Effective Date other than under the terms of this Agreement (Background IP). This Agreement shall not confer on either Party any rights in and/or to any Background IP of the other party, except as otherwise provided in this Agreement.   3 .2  CAPSUGEL Property. CARDAX acknowledges that CAPSUGEL possesses certain inventions, processes, know-how, trade secrets, improvements, other intellectual properties and other assets, including but not limited to formulation recipes, processing details, laboratory analyses, analytical methods, procedures and techniques, computer technical expertise and software, which have been independently developed by CAPSUGEL, including but not limited to, the Background IP of CAPSUGEL (collectively Capsugel Property). CARDAX and CAPSUGEL agree that any Capsugel Property or improvements thereto which are used, improved, modified or developed by CAPSUGEL under or during the term of this Agreement are the product of CAPSGUEL's technical expertise possessed and developed by CAPSUGEL prior to the Effective Date and are the sole and exclusive property of CAPSUGEL.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 6





      3 . 3  CARDAX Property. CAPSUGEL acknowledges that CARDAX possesses certain inventions, processes, know-how, trade secrets, improvements, other intellectual properties and other assets, which have been independently developed by CARDAX, including but not limited to, the Background IP of CARDAX (collectively CARDAX Property). CAPSUGEL and CARDAX agree that any CARDAX Property or improvements thereto which are used, improved, modified or developed by CARDAX under or during the term of this Agreement are the product of CARDAX's technical expertise possessed and developed by CARDAX prior to the Effective Date and are the sole and exclusive property of CARDAX.   3.4 Use of Confidential Information. CARDAX may use the confidential information of CAPSUGEL generated under this Agreement, except for CAPSUGEL's internal technical protocols and Background IP, to the extent necessary (i) in connection with seeking regulatory approval for a Compound Formulation or the Product and/or (ii) filing a patent application. Compound Formulation means any specific combination of excipient(s) and the Active Ingredient developed as a result of the work conducted under this Agreement. CARDAX may use and disclose CAPSUGEL's internal technical protocols and Background IP, to the extent necessary for Regulatory Approvals as contemplated by Section 2.3(b) to the extent reasonably determined by CAPSUGEL after notice and consultation with CAPSUGEL by CARDAX.   3.5 Inventions. Each Party will own all of its inventions and other Intellectual Property Rights made under this Agreement, including any patents, patent applications and other Intellectual Property Rights related to such inventions, if any, made solely by its employees or independent contractors or employees or independent contractors of its Affiliates, unless otherwise expressly set forth herein.   3.6 Joint Inventions. The Parties will jointly own all inventions and other Intellectual Property Rights jointly made under this Agreement that are directly resulting from work conducted under this Agreement in accordance with the Development Plan and related specifically to the Product or the Compound Formulation, including any patents, patent applications and other Intellectual Property Rights related to such inventions, if any, unless otherwise expressly set forth herein. During the Term, each Party hereby provides a worldwide, exclusive, royalty free, perpetual license of such Intellectual Property Rights for use by each licensee in its business in connection with the development and marketing and commercialization of the Product. For avoidance of doubt, no Party or any of its Affiliates shall have any rights to the Background IP of the other Party nor shall any Party have rights to any trademarks, service marks, trade names, business names or product names developed by the other Party. All decisions regarding the protection and exploitation of joint investments and other Intellectual Property Rights shall be determined by the JPT or otherwise in accordance with Section 2.1.   3.7 [reserved]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 7





     3.8 Freedom to Operate. CARDAX acknowledges that it shall be solely and fully responsible to use its Commercially Reasonable Efforts for doing any and all freedom to operate assessments regarding possible infringement of third party intellectual property rights for the Product in the part of the Territory that the Parties reasonably determine require such protection; provided, however, each Party shall be solely and fully responsible for doing any and all freedom to operate assessments regarding possible infringement of third party intellectual property rights for any and all of its Intellectual Property Rights.   Section 4   Exclusivity   [***]   Section 5   Consideration   5.1 Royalty Payments. CAPSUGEL shall pay to CARDAX a royalty equal to [***] of the Adjusted Net Sales (Royalty Payment) within [***] after the end of [***].   5.2 Mode of Payment. CAPSUGEL will endeavor to contract with Marketer to receive profit sharing payments in U.S. dollars and CAPSUGEL will in turn pay CARDAX its share in U.S. dollars. Should Marketer require that local currency based payments be made to CAPSUGEL then CAPSUGEL will pay CARDAX its share in such local currency unless otherwise agreed. For instances in which Marketer sells the product in a local currency other than U.S. dollars but agrees to pay CAPSUGEL in U.S. dollars, the conversion of local currency to USD will be a mutually agreeable methodology with such Marketer (e.g., using the Marketer's standard accounting methodology such as its average daily rate for its accounting month).   5.3 Taxes. All federal, national, regional, district, local or other governmental income tax or similar tax that is imposed on either Party as a result of income, shall be the responsibility of such Party. All amounts payable by CAPSUGEL to CARDAX under this Agreement shall be paid free and clear of all deductions or withholdings whatsoever, except as may be required by law. If any deductions or withholdings are required by law to be made from any of the amounts payable by CAPSUGEL to CARDAX, the amount of any such withholding may be treated as part of the Royalty Payment, depending on the timing and the applicable legal requirements and CAPSUGEL shall provide CARDAX a receipt of any such withholdings.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 8





    Section 6   Regulatory Requirements   6.1 Regulatory Contacts. [***] CAPSUGEL shall notify CARDAX immediately, and in no event, no later than three (3) business day(s), after it receives any contact or communication from any governmental or regulatory authority, including without limitation the FDA, that in any way relates to or may have an impact on a Product or the CAPSUGEL Development Activities.   6.2 Regulatory Inspections. Throughout the Term of this Agreement, CAPSUGEL agrees to cooperate with any governmental or regulatory body, particularly the FDA, which requests a general GMP inspection or audit or any inspection or audit relative to the manufacture, storage, handling, or shipment of Product manufactured, stored, handled, or shipped by CAPSUGEL. In addition, CAPSUGEL shall use its Commercially Reasonable Efforts to meet all reasonable U.S. FDA and other appropriate regulatory demands.   6.3 CARDAX Inspection. CARDAX shall have the right to audit CAPSUGEL's facilities, quality systems and records from time to time upon reasonable notice and CARDAX shall have the right to have a third party accounting firm, subject to a non-disclosure agreement, audit CAPSUGEL's financials as they relate to Net Sales and Adjusted Net Sales. In the event that the amount of the Royalty Payment for any quarter is 10% or more than the amount reported by CAPSUGEL, then CAPSUGEL will pay the costs and expenses of the audit or investigation.   6.4 Regulatory Notices. CAPSUGEL shall provide prompt written notice to CARDAX of the occurrence of, and the results of any regulatory notices including inspections as referenced in this Section 6 relating to the manufacture of Product.   6.5 Recordkeeping. CAPSUGEL shall keep true, accurate, and complete books, records, reports, and accounts (hereinafter Records) of all business or activities in connection with or relating to the manufacture, storage, handling, and shipment, including all validations, qualification, and validation protocols, of Product and this Agreement. CARDAX has the right, upon reasonable prior notice and during normal business hours, to inspect and examine such Records. CAPSUGEL agrees to retain all such Records for a period of five (5) years after the expiration of the Term or after termination of this Agreement.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 9





    6.6 Recall. In the event that either Party believes it may be necessary to conduct a recall, field correction, market withdrawal, stock recovery, or other similar action with respect to any Product which was sold under this Agreement (a Recall), CARDAX and CAPSUGEL shall promptly consult with each other in good faith as to how best to proceed, it being understood and agreed that the final decision as to any Recall of any Product sold by Marketer(s) shall be made jointly; provided, however, that neither Party shall be prohibited hereunder from taking any action that it is required to take by Applicable Law or taking Commercially Reasonable Efforts to mitigate the loss from any Recall or seizure or to protect the public. Each of CAPSUGEL and CARDAX shall make a permanent, complete and accurate record of all costs incurred by it in connection with any Product Recall or seizure. With respect to any Recall or seizure of any Product caused by the negligence, mistake or omission of CAPSUGEL, CAPSUGEL shall (i) reimburse CARDAX for all out-of-pocket costs and expenses reasonably incurred by CARDAX in connection with the Recall or seizure, including, without limitation, replacing the Product subject to the Recall or seizure in accordance with this Agreement; and (ii) as provided in Section 8.1, indemnify and save CARDAX and its Affiliates harmless from and against any and all damages to or claims by third parties associated (or Affiliated) with or resulting from any such Recall or seizure. With respect to any Recall or seizure caused by the negligence, mistake or omission of CARDAX (including but not limited to failure of the Active Ingredient to meet the Specifications), CARDAX shall: (i) reimburse CAPSUGEL for all out-of-pocket costs and expenses reasonably incurred by CAPSUGEL in connection with the Recall or seizure; and (ii) as provided in Section 8.2, indemnify and save CAPSUGEL and its Affiliates harmless from and against any and all damages to or claims by third parties associated with or resulting from any such Recall or seizure.   With respect to any Recall or seizure of a Product not caused by the negligence, mistake or omission of either Party, each Party shall bear [***] of the aggregate costs of any and all out-of-pocket costs, expenses and losses reasonably incurred by either Party in connection with the Recall or seizure.   If CAPSUGEL and CARDAX cannot agree which party is at fault or whether a Recall or seizure was reasonably beyond the control of the Parties, then an independent technical expert, acceptable to both Parties, shall be designated to make such determination. The designated technical expert shall not be an employee, consultant, officer, director or shareholder of, or otherwise associated with, CAPSUGEL, CARDAX or their respective Affiliates. The technical expert's determination will be, in the absence of fraud or manifest error, binding and conclusive upon the Parties.   Each Party shall keep the other fully informed of any notification or other information, whether received directly or indirectly, which might affect the marketability, safety or effectiveness of a Product, or which might result in liability issues or otherwise necessitate action on the part of either party, or which might result in Recall or seizure of the Product.   Prior to any reimbursement pursuant to this Section 6 the Party claiming reimbursement shall provide the other Party with all available documentation of all reimbursable costs and expenses.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 10





    Section 7   Representations and Warranties   7.1 Representations and Warranties of CAPSUGEL. CAPSUGEL hereby represents and warrants to CARDAX as follows:     (a) CAPSUGEL is a corporation in good standing under the laws of the jurisdiction of its organization and authorized to do business wherever necessary to fulfill the terms and conditions of this Agreement;         (b) CAPSUGEL has the full power and authority to execute and deliver this Agreement and perform its covenants, duties and obligations described in this Agreement;         (c) This Agreement is the valid, legal and binding obligation of CAPSUGEL, enforceable in accordance with its terms;         (d) Neither the execution and delivery of this Agreement nor the performance of CAPSUGEL's covenants, duties and obligations described in this Agreement constitute or will constitute a default under or conflict with any judgment, decree or order of any court or other governmental body to which CAPSUGEL is subject and will not conflict or be inconsistent with or result in the termination, modification, breach or default under the terms of any contract, commitment, covenant, agreement, instrument, document or understanding to which CAPSUGEL is a party;         (e) CAPSUGEL is not a party to, nor to CAPSUGEL's knowledge is CAPSUGEL as of the Effective Date threatened with, any legal or equitable action or proceeding before any court, arbitrator, administrative agency or other tribunal which is reasonably likely to adversely affect its ability to execute and deliver this Agreement or fully and timely perform its covenants, duties and obligations described in this Agreement;         (f) CAPSUGEL has obtained and continuously maintained all permits, authorizations and licenses issued by all federal, state and local governmental agencies and authorities necessary for the conduct of CAPSUGEL's businesses as of the Effective Date;         (g) CAPSUGEL has and shall continue to follow, comply with and adhere to all Applicable Laws necessary for the conduct of CAPSUGEL's businesses;

CAPSUGEL shall during the performance of the CAPSUGEL Development Activities ensure that, at all times, its employees, contractors, consultants, sub-contractors carry out their duties with all reasonable skill and care customary for the type of scientific research and development work covered by this Agreement and shall at all times comply with all applicable laws and regulations; record experimental data and all other material information relating to the CAPSUGEL Development Activities in individual notebooks or other appropriate formats and treat the same as Confidential Information; ensure that, at all times, its employees, contractors, consultants and sub-contractors are fully aware of and comply with the confidentiality provisions of their respective contracts which, for the avoidance of doubt, are comparable to the confidentiality provisions set out in this Agreement; keep CARDAX informed of the progress of the CAPSUGEL Development Activities by providing bi-weekly written reports and such other interim reports or updates as CARDAX may reasonably request.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 11





     7.2 Representations and Warranties of CARDAX. CARDAX hereby represents and warrants to CAPSUGEL as follows:     (a) CARDAX is a corporation in good standing under the laws of the jurisdiction of its organization and authorized to do business wherever necessary to fulfill the terms and conditions of this Agreement;         (b) CARDAX has the full power and authority to execute and deliver this Agreement and perform its covenants, duties and obligations described in this Agreement;         (c) This Agreement is the valid, legal and binding obligation of CARDAX, enforceable in accordance with its terms;         (d) Neither the execution and delivery of this Agreement nor the performance of CARDAX's covenants, duties and obligations described in this Agreement constitute or will constitute a default under or conflict with any judgment, decree or order of any court or other governmental body to which CARDAX is subject and will not conflict or be inconsistent with or result in the termination, modification, breach or default under the terms of any contract, commitment, covenant, agreement, instrument, document or understanding to which CARDAX is a party;         (e) CARDAX is not a party to, nor to CARDAX's knowledge is CARDAX as of the Effective Date threatened with, any legal or equitable action or proceeding before any court, arbitrator, administrative agency or other tribunal which is reasonably likely to adversely affect its ability to execute and deliver this Agreement or fully and timely perform its covenants, duties and obligations described in this Agreement; and         (f) CARDAX has obtained and continuously maintains all permits, authorizations and licenses issued by all federal, state and local governmental agencies and authorities necessary for the conduct of CARDAX's businesses as of the Effective Date.

Disclaimer. THE REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS AGREEMENT ARE THE PARTIES' ONLY WARRANTIES AND NO OTHER WARRANTY, EXPRESS, IMPLIED OR STATUTORY, WILL APPLY. EACH PARTY EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. FOR THE AVOIDANCE OF DOUBT, EACH PARTY EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF NON-INFRINGEMENT THAT ARE NOT EXPRESSLY SET FORTH IN THIS AGREEMENT.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 12





    Section 8   Indemnification   8.1 CAPSUGEL's Indemnification of CARDAX. CAPSUGEL shall indemnify, defend and hold CARDAX, its Affiliates and their respective officers, directors, employees and agents harmless from and against any and all third party Losses suffered, incurred or sustained by CARDAX or to which CARDAX becomes subject at any time, to the extent arising out of or resulting, directly or indirectly, from: (a) any breach of CAPSUGEL's representations, warranties or obligations under this Agreement; (b) any personal injury, death or property damage caused by the possession, use, or consumption by any person of any Product that does not comply with the Specification in any way or is the result of actions or inactions of CAPSUGEL in its manufacturing or is alleged to result from any inherent risk of the Formulation or a defect in the Formulation; and (c) any other negligent act or omission on the part of CAPSUGEL, its Affiliates or their respective employees or agents except, in each case, to the extent such claims are attributable to the gross negligence or willful misconduct of CARDAX.   8.2 CARDAX's Indemnification of CAPSUGEL. CARDAX shall indemnify, defend and hold CAPSUGEL, its Affiliates and their respective officers, directors, employees and agents harmless from and against any and all third party Losses suffered, incurred or sustained by CAPSUGEL or to which CAPSUGEL becomes subject at any time, to the extent arising out of or resulting, directly or indirectly, from (a) any breach of CARDAX's representations, warranties or obligations under this Agreement; (b) any personal injury, death or property damage caused by the possession, use or consumption by any person of any Product supplied by CAPSUGEL under this Agreement that does not comply with the Specifications as a result of actions or inactions of CARDAX or is alleged to result from any inherent risk of the Product or a defect in the Active Ingredient; and (c) any other negligent act or omission on the part of CARDAX, its Affiliates or their respective employees or agents except, in each case, to the extent such claims are attributable to the gross negligence or willful misconduct of CAPSUGEL.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 13





    8.3 Indemnification Process. If CARDAX, Affiliates or their respective employees, servants or agents, or CAPSUGEL, its Affiliates or their respective employees, servants or agents (in each case an Indemnified Party), receive any written claim which such Indemnified Party believes is the subject of indemnity hereunder by the other Party hereto (an Indemnifying Party), the Indemnified Party shall, as soon as reasonably practicable after forming such belief, give notice thereof to the Indemnifying Party, provided that the failure to give timely notice to the Indemnifying Party as contemplated hereby shall not release the Indemnifying Party from any liability to the Indemnified Party unless the Indemnifying Party demonstrates that the defense of such claim is prejudiced by such failure. The Indemnifying Party shall have the right, by prompt notice to the Indemnified Party to assume the defense of such claim at its cost, with counsel reasonably satisfactory to the Indemnified Party. If the Indemnifying Party does not so assume the defense of such claim or, having done so, does not diligently pursue such defense, the Indemnified Party may assume the defense, with counsel of its choice, but at the cost of the Indemnifying Party. If the Indemnifying Party so assumes the defense, it shall have absolute control of the litigation; the Indemnified Party may, nevertheless, participate therein through counsel of its choice and at its cost. The Party not assuming the defense of any such claim shall render all reasonable assistance to the Party assuming such defense, and out-of-pocket costs of such assistance shall be for the account of the Indemnifying Party. No such claim shall be settled other than by the Party defending the same, and then only with the consent of the other Party, which consent shall not be unreasonably withheld; provided that the Indemnified Party shall have no obligation to consent to any settlement of any such claim which (i) imposes on the Indemnified Party any liability or obligation which cannot be assumed or performed in full by the Indemnifying Party, (ii) does not unconditionally release the Indemnified Party, (iii) does require a statement as to or an admission of fault, culpability or failure to act by or on behalf of Indemnified Party or any of its Affiliates or (iv) does impose any restrictions on the conduct of business by the Indemnified Party or its Affiliates.   8.4 Limitation of Damages.  IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OR LOST PROFITS ARISING UNDER OR RELATING TO THIS AGREEMENT. Except in the event of (i) a Party's gross negligence or willful misconduct and/or (ii) a Party's breach of its confidentiality obligation, the total liability of one Party to the other Party (and its Affiliates) arising out of or in connection with this Agreement or the Products, whether in contract, tort (including negligence), statute or otherwise, shall, to the maximum extent permitted by Applicable Law, be limited to the amount of revenues it receives under this Agreement.   8.5 Insurance. During the Term and for a period of two (2) years after the termination of the Agreement or the expiry date of the last batch manufactured whichever is later, thereafter, each Party shall obtain and maintain, at its sole expense adequate product liability insurance for the Product as it reasonably deems necessary and appropriate. Evidence of coverage, in the form of certificates of insurance, shall be provided promptly upon registration of the Product in given countries and as reasonably requested thereafter.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 14





    Section 9   Confidentiality and Publicity   Confidentiality. The Parties agree that the terms of the Confidentiality Agreement entered into between the parties dated Nov 19, 2013 shall govern this Agreement.   Section 10   Term and Termination   10.1 Term and Renewal. [***] In addition, any contract entered into by the Parties with a Marketer for the Product shall survive termination of this Agreement in accordance with its terms, including any renewal rights provided therein.   10.2 Termination for Breach . A material breach that is subject to cure that is not cured within [***] of written notice of breach shall be cause for termination, provided that if the breaching party is diligently pursuing in good faith the remedy of the breach at the expiration of such [***] cure period, then such [***] cure period shall be extended for a reasonable period to effect the cure. Upon any breach by CAPSUGEL, CARDAX shall be permitted to use all Intellectual Property of CAPSUGEL used in the Formulation and the Product to the extent necessary for the development and marketing of the Product. Upon any breach by CARDAX, CAPSUGEL shall be permitted to use all Intellectual Property of CARDAX used in the Active Ingredient and the Product to the extent necessary for the development and marketing of the Product in accordance with the terms of this Agreement as of the date of such termination.   10.3 Termination for Bankruptcy . This Agreement may be terminated by either Party, forthwith, or at any time thereafter by notice to the other if the other becomes bankrupt or insolvent, or enters into liquidation whether compulsorily or voluntarily, or convenes a meeting of its creditors, or has a receiver appointed over all or part of its assets, or ceases for any reason to carry on business.   10.4 Development or Commercial Non-Viability.   In the event that CAPSUGEL reasonably determines that the development of the Compound Formulation is not feasible with Commercially Reasonable Efforts in accordance with the Development Plan, with such changes as reasonably requested by CAPSUGEL, then CAPSUGEL may discontinue the development of the Compound Formulation and Product and terminate this Agreement, in which case, CARDAX shall have the right to license the Intellectual Property Rights as provided in Section 4.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 15





    In the event that CARDAX reasonably determines that, with Commercially Reasonable Efforts by the Parties, the development of a Product is not feasible due to any legal, or technical developments with respect to the Product, including but not limited to conflicts of Intellectual Property Rights; withdrawal of a Product by a major regulatory agency for safety or efficacy reasons; or inability of the Parties to produce a Product that passes FDA required biostudies, in which such developments make the Product nonviable or that the Product is not acceptable to any applicable Marketer, then, CARDAX may elect to discontinue the development of the Product and terminate this Agreement.   10.5 Termination for Force Majeure. Neither Party shall be liable to the other for default or delay in the performance of any of its obligations under this Agreement if such default or delay shall be caused directly or indirectly by accident, fire, flood, riot, war, terrorism, act of God, embargo, strike, failure or delay of normal source of supply of materials, or delay of carriers, equipment failure or complete or partial shutdown of plant by any of the foregoing causes or other causes beyond its reasonable control, including FDA action (Force Majeure).   10.6 No Waiver. The failure of either Party to terminate this Agreement by reason of the breach of any of its provisions by the other Party shall not be construed as a waiver of the rights or remedies available for any subsequent breach of the terms and provisions of this Agreement.   10.7 Property. In the event of termination of this Agreement for whatever cause, in addition to the other obligations of the Parties hereunder, each Party shall return to the other Party or to the other Party's designee no later than thirty (30) days after the effective date of termination all of such other Party's property, including all proprietary information, in its possession, except to the extent required to be retained by law or to comply with such Party's continuing obligations hereunder.   10.8 Survival. The provisions of Sections 3.6, 4, 6, 8, 9 and 11 shall survive any termination of this Agreement.   Section 11   Miscellaneous   11.1 Dispute Resolution. This Agreement shall be governed by and interpreted in accordance under the laws of the State of New York. Any dispute, controversy or claim arising out of this Agreement, or the breach, termination or invalidity thereof, shall be discussed between the senior management of the Parties who will attempt to resolve the matter amicably. Any disputes which cannot be resolved in this way within sixty (60) days of one Party notifying the other of the existence of a dispute shall be finally settled before JAMS in accordance with the expedited arbitration procedures of JAMS. The arbitration shall be conducted in English in New York, New York, USA. The costs of the arbitration payable to JAMS shall be funded equally by the parties, provided that the prevailing party shall be reimbursed for such costs and expenses and its own actual out of pocket costs   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 16





    11.2 Integration and Amendment . This Agreement, the Exhibits hereto contain the complete agreement between the Parties with respect to the subject matter hereof. All previous and collateral agreements, representations, warranties, promises and conditions relating to the subject matter of this Agreement are superseded by this Agreement. This Agreement may only be amended by a written instrument duly executed by the Parties hereto.   11.3 Assignment. Neither Party may assign this Agreement without the prior written consent of the other Party; provided, however that either Party may assign in connection with a merger or sale of all or substantially all of its stock or assets, provided the assignee agrees to be bound by all of the terms and conditions of this Agreement.   11.4 Waiver. No waiver of any default by either Party shall be deemed to constitute a waiver of any subsequent default with respect to the same or any other provision hereof. No waiver shall be effective unless made in writing with specific reference to this Agreement and signed by a duly authorized representative of the Party granting the waiver.   11.5 Notice. Any notice or request expressly provided for or permitted under this Agreement shall be in writing, delivered manually or by mail, e- mail, or facsimile and shall be deemed sufficiently given if and when received by the Party to be notified at its address first set forth below, or if and when mailed by registered mail or certified mail, postage prepaid, addressed to such Party at such address, or upon delivery confirmation. Either Party, by notice to the other, may change its address for receiving such notices.     If to CAPSUGEL: CAPSUGEL US, LLC   412 Mt. Kemble Ave. Suite 200C   Morristown, NJ 07960 USA   Attn: President, Dosage Form Solutions Telephone: [***] Facsimile: [***] E-mail: [***]     With a copy to CAPSUGEL US, LLC   412 Mt. Kemble Ave. Suite 200C   Morristown, NJ 07960 USA   Attn: General Counsel Telephone: [***] Facsimile: [***] E-mail: [***]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 17





      If to CARDAX: CARDAX, Inc.   2800 Woodlawn Dr., Suite 129   Honolulu, HI 96822   Attn: President and CEO Telephone: [***] Facsimile: [***] E-mail: [***]     With a copy to  Herrick, Feinstein LLP   2 Park Avenue   New York, NY 10016   Attn: Richard M. Morris Telephone: [***] Facsimile: [***] E-mail: [***]   11.6 Severability of Provisions. Each provision of this Agreement shall be treated as a separate and independent clause, and the unenforceability of any one clause shall in no way impair the enforceability of any of the other clauses herein. Moreover, if one or more of the provisions contained in this Agreement shall for any reason be held to be excessively broad as to scope, activity, subject or otherwise so as to be unenforceable at law, such provision or provisions shall be construed by the appropriate judicial body or arbitration panel by limiting or reducing such provision or provisions, so as to be enforceable to the maximum extent allowable under the applicable law as such law shall then be.   11.7 Independent Contractors. Each Party hereto shall be an independent contractor of the other. Neither Party shall be the legal agent of the other for any purpose whatsoever and therefore has no right or authority to make or underwrite any promise, warranty or representation, to execute any contract or otherwise to assume any obligation or responsibility in the name of or on behalf of the other Party, except to the extent specifically authorized in writing by the other Party. Neither Party shall be bound by or liable to any third persons for acts or obligations or debts incurred by the other toward such third party, except to the extent specifically agreed to in writing by the Party to be so bound. This Agreement shall not create a partnership or other similar arrangement.   11.8 Announcement. The Parties agree to coordinate external communications (e.g. joint press release) regarding this collaboration.   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 18





    11.9 Headings; Interpretation. The section headings contained in this Agreement are for convenience of reference only, do not form a part of this Agreement and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words include, includes and including shall be deemed to be followed by the phrase but not limited to. All references herein to Sections, Sections and Exhibits shall be deemed references to Sections and Sections of, and Exhibits to, this Agreement unless the context shall otherwise require. All Exhibits attached to this Agreement shall be deemed incorporated herein by reference as if fully set forth herein. Words such as herein, hereof, hereto, hereby and hereunder refer to this Agreement and to the Exhibits, taken as a whole. Except as otherwise expressly provided herein: (a) any reference in this Agreement to any agreement shall mean such agreement as amended, restated, supplemented or otherwise modified from time to time; (b) any reference in this Agreement to any law shall include corresponding provisions of any successor law and any regulations and rules promulgated pursuant to such law or such successor law; and (c) all terms of an accounting or financial nature shall be construed in accordance with generally accepted accounting principles, as in effect in the United States from time to time.   11.10 Counterparts. This Agreement may be executed by the Parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original and all of which counterparts taken together shall constitute but one and the same instrument.   * * * Signature Page Follows * * *   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 19





    IN WITNESS WHEREOF, the Parties have caused this this Agreement to be executed by their respective duly authorized representatives as of the day and year first above written.   CAPSUGEL US, LLC   By: /s/ Amit Patel   Name: Amit Patel   Title: President, Dosage Form Solutions     CARDAX, INC.   By: /s/ David G. Watumull   Name: David G. Watumull   Title: President and CEO     CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 20





    EXHIBIT A   DEVELOPMENT PLAN   [***]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 21





    EXHIBIT B   SPECIFICATIONS   As provided in Section 1.26, to be provided upon conclusion of the Development Plan   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 22





    EXHIBIT C   [***]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 23





    EXHIBIT D   MASS MARKET CHANNELS   [***]   CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934. OMISSIONS ARE DESIGNATED [***]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. 24 
Question: 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?

Answer: During the Term and for a period of two (2) years after the termination of the Agreement or the expiry date of the last batch manufactured whichever is later, thereafter, each Party shall obtain and maintain, at its sole expense adequate product liability insurance for the Product as it reasonably deems necessary and appropriate. Evidence of coverage, in the form of certificates of insurance, shall be provided promptly upon registration of the Product in given countries and as reasonably requested thereafter.


Question: Exhibit 2.01   Strategic Alliance Agreement   This agreement is made and entered into this 30th day of November, 2017 by and between Bravatek Solutions, Inc., a corporation organized under the laws of the State of Colorado, (Bravatek), with an address at 2028 E. Ben White Blvd., Unit #240-2835, Austin, Texas, 78741, and Sibannac, Inc. (COMPANY), a corporation organized under the laws of Nevada, with an address at 2122 E Highland Avenue, Suite 425, Phoenix, Arizona 85016.   Whereas, Bravatek is a corporation, which has technical expertise in security-related software, tools and systems/services (including telecom services) to support, deploy and test its current and potential customers' most critical initiatives.   Whereas, COMPANY a corporation engaged in the business of providing a novel, patented Air Cylinder Wheel, to replace the need for conventional rubber tires on a large range of vehicles used in the mining, military, construction and industries, delivering cost savings and reducing adverse environmental impact.   Whereas, the parties desire to enter into a business relationship which will designate Bravatek as the project based business partnership channel for governmental and non-governmental departments / agencies / units for the purpose of promoting COMPANY's relevant capabilities, products and/or service solutions. Now therefore, the parties mutually agree to enter into a strategic alliance under the following terms and conditions:   1) Duties of Bravatek   Bravatek agrees to serve as a non-exclusive project sales lead finder for COMPANY. In this capacity, Bravatek will use its best efforts to provide the following services to COMPANY.   a. Promote, market and introduce the Products to prospective clients in the government space nationwide.   b. Provide a quarterly Pipeline or project information leads report to COMPANY on a monthly basis which contains a 3-month rolling forecast of potential sales.   c. Follow-up on on-going project leads that COMPANY is actively engaged with or believes is appropriate.   d. Provide COMPANY with any promotional materials, technical papers, white papers, proposals, etc. prior to publication or delivery to prospective clients.

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  2) Duties of COMPANY   COMPANY agrees to use its best efforts to promote and support project lead finding and after-sales support of Bravatek by:   a. Listing Bravatek in all appropriate sales and marketing materials as a non-exclusive alliance partner (with focus of government customers)   b. Provide timely responses to both technical and administrative questions posed by Bravatek.   c. Promote Bravatek's product and service offerings whenever possible.   d. Aid Bravatek in the writing of any technical/marketing/sales documents when requested and participate in mutually-agreed upon sales calls.   e. Provide Bravatek with co-branded marketing material that can be emailed or handed to prospective clients.   3) Obligations of the Parties   Bravatek and COMPANY agree to jointly:   a. Develop and implement a joint Product Solution and Application Strategy whereby targeted markets/potential client- types/applications are mutually agreed upon;   b. Support each other in all agreed-upon technical, marketing and promotional efforts;   c. Develop a joint strategy for developing new product/services/capabilities to mutually benefit both parties;   d. Utilize each other as Preferred Vendors for services whenever possible upon mutual agreement.   4) Compensation   When custom Products are designed, developed and to be delivered to Bravatek-identified perspective clients, the parties shall agree to a proposed sales price for use during the project in writing prior to the commencement of each project.

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  For any Product or Solution sold to any perspective clients introduced by Bravatek registered with COMPANY via email to COMPANY's CEO and delivered through Bravatek or a COMPANY-designated distribution affiliate(s) or sales channel(s), Bravatek will receive a lead-finder fee, to be mutually discussed and finally decided by COMPANY at the range of minimum of 10% to maximum of 20% of project revenue, with an exact fee to be depending upon the overall project sales margin and cost of development and delivery of each project, payable NET 30 days after each client payment on delivered products received at COMPANY's bank account.   5) Confidentiality   Confidential information shall mean any and all technical and non-technical information, documents and materials related to client projects of party and products, services and business of each of the parties. COMPANY and Bravatek agree to maintain in strict confidence and not to disclose or disseminate, or to use for any purposes other than performance of the projects, the Confidential Information disclosed.   The obligation of non-disclosure shall not apply to the following:   a. Information at or after such time that is publicly available through no fault of either party   b. Information at or after such time that is disclosed to either party by a third party entitled to disclose such information   c. Information which is required by law to be disclosed to federal, state or local authorities.   6) Term of Confidentiality   For a period of five (5) years after termination of this Agreement, the parties shall treat as confidential all information and take every reasonable precaution and use all reasonable efforts to prevent the unauthorized disclosure of the same. The parties agree to take all steps reasonably necessary and appropriate to ensure that their employees, agents, and/or assistants treat all information as confidential and to ensure that such employees, agents, and/or assistants are familiar with and abide by the terms of this Agreement.   7) Term   The term of this Agreement is twelve (12) months from the date hereof, and will be automatically renewed for one (1) additional twelve month period unless either party shall notify the other in writing of its intention not to renew. Such notice must be given ninety (90) days prior to expiration of the original term. This Agreement may also be terminated by either party upon ninety (90) days written notice.

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  8) Notices   Any notices required under this Agreement shall be delivered to:   Bravatek Technologies, Inc. 2028 E. Ben White Blvd., Unit #240-2835 Austin, Texas 78741   Sibannac, Inc. 2122 E Highland Avenue, STE 425 Phoenix, AZ 85016   9) Governing Law   This Agreement is entered into in the State of Texas and shall be interpreted according to the laws of the State of Texas.   10) Indemnification   COMPANY shall indemnify Bravatek, its directors, officers and employees, for any and all damages, costs, expenses, and other liabilities, including reasonable attorney's fees and court costs incurred in connection with any third-party claim, action or proceeding arising from the negligence or intentional misconduct of COMPANY or breach of COMPANY of any of its obligations under this Agreement.   Bravatek shall indemnify COMPANY, its directors, officers and employees, for any and all damages, costs, expenses, and other liabilities, including reasonable attorney's fees and court costs, incurred in connection with any third-party claim, action or proceeding arising from the negligence or intentional misconduct of Bravatek or breach of Bravatek of any of its obligations under this Agreement.   11) Modifications   No changes or modifications of this Agreement or any of its terms shall be deemed effective unless in writing and executed by the parties hereto.   12) Assignment   This Agreement shall not be assignable by either party without the prior written consent of the other party.

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  13) Entire Agreement   This Agreement represents the complete and entire understanding between the parties regarding the subject matter hereof and supersedes all prior negotiations, representations, or agreements, either written or oral, regarding this subject matter.       This Agreement shall not be considered accepted, approved or otherwise effective until signed by the appropriate parties.     Bravatek Technologies, Inc.  Sibannac, Inc.     By: /s/ Thomas A.Cellucci  By: /s/ David Mersky     Name: Thomas A. Cellucci  Name: David Mersky     Title: Chairman & CEO  Chief Executive Officer     Date: November 30, 2017  Date: November 30, 2017

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Question: Highlight the parts (if any) of this contract related to Minimum Commitment that should be reviewed by a lawyer. Details: Is there a minimum order size or minimum amount or units per-time period that one party must buy from the counterparty under the contract?

Answer: For any Product or Solution sold to any perspective clients introduced by Bravatek registered with COMPANY via email to COMPANY's CEO and delivered through Bravatek or a COMPANY-designated distribution affiliate(s) or sales channel(s), Bravatek will receive a lead-finder fee, to be mutually discussed and finally decided by COMPANY at the range of minimum of 10% to maximum of 20% of project revenue, with an exact fee to be depending upon the overall project sales margin and cost of development and delivery of each project, payable NET 30 days after each client payment on delivered products received at COMPANY's bank account.


Question: EXHIBIT 10.19

                        MAINTENANCE AND SUPPORT AGREEMENT

      This Maintenance and Support Agreement (this Agreement) is entered on this 9th day of October, 2001 and is deemed effective as of October 1, 2001 (the Effective Date), by and between VerticalNet, Inc. (VNI) and VerticalNet Enterprises LLC, formerly known as Tradeum, Inc. which d/b/a VerticalNet Solutions (VNE; collectively with VNI, Vert), on the one hand, and Converge, Inc. (Converge) on the other hand.

                                    RECITALS

      WHEREAS, VNI, VNE and Converge have entered into Amended and Restated Subscription License Agreement effective as of the date hereof (the Subscription License Agreement) pursuant to which Vert has licensed to Converge certain proprietary software products; and

      WHEREAS, Converge desires to obtain and VNE is willing to provide certain maintenance and support services with respect to such products on the terms and conditions set forth herein.

      NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth below, and intending to be legally bound, the parties agree as follows:

                                    AGREEMENT

      1. Definitions.

            1.1 Affiliate means, when used with reference to a party, any individual or entity directly or indirectly Controlling, Controlled by or under common Control with such party.

            1.2 Business Day means a day other than a Saturday, Sunday or federal holiday.

            1.3 Control (including all derivations thereof) means, with respect to a party, the direct or indirect ownership of at least 50% of the outstanding voting securities of a party, or the right to control the policy decisions of such party.

            1.4 Converge-Requested Enhancement means any modification, improvement or enhancement to a Product that is developed by VNE at the specific request of Converge as part of the Professional Services provided hereunder.

            1.5 Documentation means the documentation for the Supported Products that is made generally available by Vert to users or licensees of such Supported Products and, with respect to Supported Products that have been customized for Converge, any supplemental documentation for such Supported Products that is provided by VNE to Converge.

            1.6 Enhancement means a Vert-General Release Enhancement or a Converge-Requested Enhancement.

            1.7 Error means a failure of a Supported Product to substantially conform to its corresponding Documentation (or if there is no such Documentation, to its closest reasonable equivalent).

            1.8 Initial Term is defined in Section 9.1 below.

            1.9 Intellectual Property shall mean any and all trade secrets, patents, copyrights, trademarks, service marks, trade names, domain names, trade dress, URLs, brand features, know-how and similar rights of any type under the laws of any applicable governmental authority, including, without limitation, all applications and registrations relating to any of the foregoing.

            1.10 Intellectual Property Rights shall mean all rights in and to Intellectual Property.

            1.11 Maintenance and Support Services means the services described in Section 2 below.

            1.12 Maintenance Update means any workaround, bug fix or other software code for a Supported Product that is primarily designed to correct an Error in or other Problem caused by such Supported Product.

            1.13 Object Code means computer programming code in compiled, machine readable format, running, to the extent requested under a Work Plan or SOW, on each of Unix (at least Tru64 and HP-UX) and Windows NT (or their successor operating systems), together with all related end-user or installation manuals and other similar documentation.

            1.14 Party or party means Vert, VNI and/or VNE, as applicable, on the one hand, and Converge on the other hand.

            1.15 Personnel means agents, employees, independent contractors, temporary employees or subcontractors engaged or appointed by Converge, VNI or VNE, respectively.

            1.16 Problem means a Severity Level 1, 2, 3 or 4 problem with a Supported Product (whether or not attributable or believed to be attributable to





an Error), as such problems are described in greater detail in Exhibit A hereto.

            1.17 Problem Report means a report by Converge of a Problem with respect to a Supported Product, which report indicates the Problem and identifies its Severity Level.

            1.18 Professional Services means services performed or to be performed by VNE hereunder with respect to the development of Converge-Requested Enhancements, the implementation of or migration to new Products or Enhancements, customer installations of the Products, training with respect to use or operation of the Products or any Enhancements (including training designed to enable Converge to provide Level 1 support for the Supported Products), consulting services with respect to the Products or their hardware or other application and system software environments, or any other services described in Section 3 below.

                                        2

            1.19 Quarterly Allocation means the quarterly allocation of Services being made available to Converge hereunder, as specified in greater detail in Exhibit C attached hereto.

            1.20 Renewal Term is defined in Section 9.1 below.

            1.21 Services means all of the services provided or to be provided by VNE under this Agreement, including, without limitation, the Maintenance and Support Services and the Professional Services.

            1.22 Source Code means computer programming code in human readable, high-level language format, together with all related documentation (including programmers' notes and annotations, logic flows, etc.).

            1.23 Support Day means Monday through Friday, excluding VNE-recognized holidays.

            1.24 Support Hours means the hours between 8:00 a.m., Eastern Time, and 5:00 p.m., Eastern Time on Support Days.

            1.25 Support Request means a question, inquiry or other support request by Converge with respect to a Deployed Product, but excluding any Problem Report or request for an Enhancement. Should any question, inquiry or other support request by Converge include or encompass a Problem Report, the portion of such question, inquiry or other support request that is a Problem Report shall be treated as such and the remainder shall be treated as a Support Request.

            1.26 Supported Products means the Deployed Products, as such term is defined under the Subscription License Agreement, but excluding the Structured Negotiations Product, as such term is defined under the Subscription License Agreement.

            1.27 Term means the Initial Term and any Renewal Term(s).

            1.28 Vert-General Release Enhancement shall have the meaning ascribed to such term under the Subscription License Agreement.

            1.29 VNE Service Personnel means the VNE personnel primarily responsible for performing the Services hereunder, including any such personnel identified on Exhibit C attached hereto.

      2. Maintenance and Support Services.

            2.1 General. The Maintenance and Support Services provided by VNE hereunder shall encompass responding to Problem Reports and Support Requests, and providing Converge with Maintenance Updates, as more particularly described in, and subject to the provisions of, this Agreement.

            2.2 Converge Support Personnel. Only authorized personnel designated by Converge (Converge Support Personnel) may communicate Problem Reports and Support

                                        3

Requests to VNE. The number of Converge Support Personnel will not exceed seven persons without VNE's prior approval. The initial Converge Support Personnel shall be identified to VNE in writing within 10 business days following the Effective Date. Converge may change the Converge Support Personnel on written notice to VNE; provided, however, that Converge shall use reasonable efforts not to change the Converge Support Personnel more frequently than once every 30 days. All replacement personnel shall be required to participate in Support Training as described in Section 3.3 below. Converge Support Personnel will be the single point of contact for the Maintenance and Support Services provided by VNE under this Section 2.

            2.3 Method of Reporting. All Problem Reports and Support Requests shall be communicated by the Converge Support Personnel to VNE as follows: (1) via telephone at 1-877-249-1423, or such other telephone number(s) as VNE may provide to Converge from time to time, or (2) via electronic mail to support.solutions@verticalnet.com, or such other e-mail address(es) as VNE may provide to Converge from time to time, or (3) in person to VNE Service Personnel (if any) on Converge premises at the time; provided, however, that the Converge Support Personnel shall communicate all Severity Level 1 and Severity Level 2





Problems to VNE via method (1) or method (3) above. Converge shall classify all Problems reported to VNE according to the Problem Severity Levels listed in Exhibit A attached hereto.

            2.4 Support Responsibilities. Converge and the Converge Support Personnel shall be responsible for providing Level 1 (help desk-type support) support to both Converge personnel (internal help desk) and Converge users (external help desk), for each of the Supported Products on which VNE has provided training as set forth in Section 3.3 below. Subject to the provisions of this Section 2, VNE shall be responsible for providing Level 2 (responding to technical inquiries) and Level 3 (code fixes) support for such Supported Products. In the case of Supported Products for which Converge is providing Level 1 support, Converge shall not escalate Problem Reports or Support Requests to VNE until such Problem Reports or Support Requests have been reasonably escalated through the Level 1 support procedures of Converge. In addition, Converge shall conduct reasonable problem identification and isolation activities to determine whether or not a given problem relates to the Products (i.e., whether a Problem as defined exists). Converge shall not escalate Problem Reports or Support Requests to VNE prior to conducting such activities or if Converge has determined that the Problem Report or Support Request does not relate to the Supported Products.

            2.5 Additional Information for Problems. With respect to each Problem reported to VNE, Converge shall provide, at the time the Problem Report is communicated to VNE and to the extent known to or reasonably ascertainable by Converge, information that will enable VNE to reproduce (in as complete a step-by-step manner as is reasonably possible), or verify the existence of the Problem, plus any additional information regarding the Problem that Converge believes will assist in the diagnosis thereof and response thereto. The parties shall reasonably cooperate to obtain and provide to VNE any additional information about the reported Problem that may be relevant to diagnosing and responding thereto. In the event that Converge is unable to make a determination based on the problem identification and isolation activities described in Section 2.4 or reproduce, or provide the information necessary for VNE to diagnose or reproduce, any Problem, Converge may request VNE's assistance in performing identification and isolation or reproducing the Problem and/or generating or documenting such information.

                                        4

            2.6 Response to Problem Reports. VNE shall use its reasonable best efforts to provide Converge with an initial response to and status reports for all Problems reported by Converge, and to resolve all Problems identified, in accordance with the provisions of Exhibit B attached hereto; provided, however, that VNE shall have no further obligation to respond to or attempt to diagnose or resolve a Problem once it is determined not to be attributable to Errors. VNE will review all Problem Requests submitted by Converge at the Problem Severity Level indicated by Converge unless another Problem Severity Level is clearly warranted. In the event of a reasonable uncertainty, the parties will assume a higher Severity Level for a Problem until they have sufficient information to make a determination that a lower Severity Level is warranted. If, at Converge's request, VNE responds to a Problem at a Severity Level that is higher than what proves to be the actual Severity Level of the Problem, or if VNE's review of a Problem reported by Converge establishes that the Problem was not due to an Error, Converge shall pay or reimburse VNE for all incremental fees and expenses reasonably incurred by VNE in performing such activities.

            2.7 Response to Support Requests. VNE shall respond to all Support Requests submitted by Converge within a reasonable period of time, taking into consideration the nature of the Support Request, its impact on Converge's business operations and any Problem Reports or other Support Requests VNE is responding to at such time.

            2.8 Tracking Procedures. VNE will maintain procedures and systems designed to ensure that Problem Reports and Support Requests submitted by Converge are properly logged and tracked. In addition, VNE will provide to Converge a weekly status log of Problem Reports and Support Requests currently being tracked. Such report shall identify, as appropriate, each Problem Report or Support Request as submitted by Converge, the Severity Level for each identified Problem, the date and time each Problem Report or Support Request was received by VNE, an assessment of the Problem Report or Support Request and an action plan detailing the proposed method of resolution, and an estimated time schedule for delivery of any necessary Error corrections.

            2.9 Remote Access. Converge shall provide VNE with remote access, via modem, the Internet or some other remote communications method mutually agreed-upon by the parties and subject to Converge's network security procedures and requirements, to Converge's servers on which the Supported Products are installed for the sole and limited purpose of enabling VNE to fulfill its obligation to provide Maintenance and Support Services hereunder. Converge shall be responsible for all costs associated with providing data network connectivity at the point of connectivity to Converge's data network. The parties will share equally in the cost of such connectivity between VNE's facilities and Converge's facilities (including all associated telecommunications charges). VNE shall not be responsible for any delay in providing Maintenance and Support Services under this Agreement to the extent such delay is due to Converge's adoption of unreasonable network security procedures or requirements.

            2.10 Provision of Maintenance Updates. VNE shall provide Converge with Maintenance Updates as VNE makes them generally available to its other customers. Converge agrees to install in the recommend environments all Maintenance Updates within a reasonable time following the date they are provided by VNE, taking into consideration any testing and customization required by Converge (the parties expect that the time for such installation





                                        5

generally will not exceed 90 days). Should Converge find one or more material deficiencies in any Maintenance Update, Converge shall promptly identify such deficiencies to VNE in reasonable detail.

            2.11 Method of Delivery. VNE will transfer to Converge all Maintenance Updates, and any associated Documentation, by remote telecommunications from the VNE place of business, to a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, if any. If any such Maintenance Update and/or associated Documentation cannot be delivered via remote telecommunications to a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, such Maintenance Update and/or Documentation will be installed by VNE on a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, if any. Converge will not obtain title or possession of any tangible personal property, including any storage media, as a result of the delivery of any Maintenance Update or associated Documentation under this Agreement.

            2.12 Acceptance. Each Maintenance Update will be deemed accepted by Converge upon Converge's receipt of the complete delivery thereof to a Converge computer located at a Converge place of business.

            2.13 License Rights. The scope of Converge's license rights to all Maintenance Updates shall be as set forth in the Subscription License Agreement. Except as may be set forth in the Subscription License Agreement, Converge acknowledges and agrees that Vert has no obligation to deliver Source Code for any Maintenance Update, or to grant Converge any license to use the Source Code form of any Maintenance Update.

            2.14 Tracking of Maintenance Updates. VNE will maintain procedures and systems designed to ensure that all Maintenance Updates are compatible with previous versions of the Supported Products and any previously provided Maintenance Updates and Enhancements.

            2.15 Modifications by Converge. Converge may notify VNE at least 10 Business Days in advance, through the Problem reporting process above, of Converge's desire to modify any Supported Product, or the hardware and other application and system software environment for any Supported Product. Within 10 Business Days of VNE's receipt of Converge's written notice, VNE will provide Converge with any recommendations that VNE may have as to how Converge should implement the desired modification. VNE shall have no responsibility for any Problems, Errors or other issues with respect to the Supported Products that are due to Converge's failure to ask for or follow any such recommendations of VNE.

      3. Professional Services.

            3.1 Project Managers. Each of Converge and VNE shall appoint a Project Manager to coordinate such party's activities with respect to the Professional Services hereunder. The initial VNE Project Manager shall be Michael Decker and the initial Converge Project Manager shall be Farooq Ahmad. Either party may change its Project Manager on notice (via e-mail or in some other reasonable fashion not necessarily in accordance with the express notice

                                        6

provisions of this Agreement) to the other party's Project Manager and Relationship Manager at any time.

            3.2 Monthly Work Plans. As reasonably requested by either party, the Converge Project Manager and the VNE Project Manager will conduct planning meetings to determine the Professional Services that VNE will provide to Converge for each month during the Term. In connection with each such planning meeting, the Converge Project Manager and the VNE Project Manager will jointly prepare a written work summary or plan (each, a Work Plan) indicating the Professional Services to be performed by VNE for such month. The Work Plan shall identify those Professional Services that the Project Managers anticipate can be performed without causing VNE to materially exceed (on a pro-rata monthly basis for the given quarter, unless otherwise mutually agreed upon in writing) the Quarterly Allocation for any quarter during the Term. All Professional Services that the Project Managers anticipate will cause VNE to materially exceed (on a pro-rata monthly basis for the given quarter, unless otherwise mutually agreed upon in writing) the Quarterly Allocation shall either be separately identified in the applicable Work Plan or performed by VNE pursuant to a Statement of Work prepared in accordance with the following provisions of this Section 3. The Converge Project Manager and the VNE Project Manager may amend any Work Plan upon their written agreement at any time.

            3.3 Training to Converge. VNE will provide, and the Work Plans will encompass as appropriate, VNE providing reasonable training and available training materials to enable Converge to provide Level 1 support for the Supported Products (Support Training). Support Training will include both introductory training reasonably in advance of when new Supported Products are put into production by Converge and periodic refreshers as appropriate when Maintenance Updates and Vert-General Release Enhancements are released. Support Training will be provided at mutually agreed locations and times.

            3.4 Environment and Deployment Process. As part of the Professional Services provided by VNE, VNE will create a document entitled, Environment and Deployment Process. This document will detail the recommended Supported Product environments and the build and deployment process for the Supported Products.





VNE agrees to complete a draft of this document for Converge's review within 30 days following the Effective Date. Converge agrees to review and provide final comments on this draft document within 30 days after receipt thereof. Both parties shall use commercially reasonable efforts to reach a mutual agreement on the document and execute the final document within 90 days following the Effective Date.

            3.5 Initial Request and Response. If Converge desires that VNE perform any Professional Services that the Project Managers anticipate would cause VNE to materially exceed (on a pro-rata monthly basis for the given quarter, unless otherwise mutually agreed upon in writing) the Quarterly Allocation, Converge shall submit to VNE a written request for such Professional Services, which request shall detail the Professional Services being requested in reasonable detail. Within 45 days after VNE's receipt of Converge's request for VNE to perform any such Professional Services, VNE shall furnish to Converge a preliminary statement of work (including proposed pricing, which shall take into account any portion of such work that will be covered by a portion of the Quarterly Allocation) under which VNE would be willing to perform such Professional Services for Converge (each, a Proposed SOW). VNE may respond to

                                        7

separate requests for Professional Services in a single Proposed SOW; provided, however, that the Proposed SOW will itemize the foregoing information separately for each of the requested Professional Services.

            3.6 Finalization of Proposed SOWs. If Converge desires to have VNE provide any Professional Services under the terms of a Proposed SOW, Converge shall notify VNE thereof in writing. Should Converge wish to negotiate the terms of the Proposed SOW, the Converge Project Manager and the VNE Project Manager shall promptly and in good faith discuss and agree upon what revisions, if any, should be made to the Proposed SOW. Should the Converge Project Manager and the VNE Project Manager reach mutual agreement on such revisions, if any, the Proposed SOW shall be finalized and executed by both parties in writing (each, a Final SOW).

            3.7 Change Orders. Either party may request changes to a previously agreed upon Final SOW. In such event, VNE will inform Converge the impact of such changes. Changes to any Final SOW will be specified in a written change order or amendment to the Final SOW. Neither party shall be bound by any change order or amendment to a Final SOW unless and until such change order or amendment has been executed by both parties in writing.

            3.8 Implementation. VNE will use commercially reasonable efforts to perform all Professional Services covered by a Work Plan or Final SOW in accordance with the schedule for performance of such Services set forth therein (or within a reasonable time, with due regard for the consequences of delayed performance, if no such schedule is set forth). Converge will reasonably cooperate with VNE in connection with its performance of such Professional Services as specified in the corresponding Work Plan or Final SOW and as may otherwise be reasonably requested by VNE. VNE shall not be liable for any default or delay in performance of such Professional Services to the extent the same is attributable to the failure of Converge to comply in any material respect with its obligations under this Agreement or any Work Plan or Final SOW.

            3.9 Method of Delivery. VNE will transfer to Converge all Converge-Requested Enhancements to Converge, and any associated&bbsp;Documentation, by remote telecommunications from the VNE place of business, to a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, if any. If any such Converge-Requested Enhancement and/or associated Documentation cannot be delivered via remote telecommunications to a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, such Enhancement and/or Documentation will be installed by VNE on a Converge computer located at a Converge place of business in the Commonwealth of Massachusetts, if any. Converge will not obtain title or possession of any tangible personal property, including any storage media, as a result of the delivery of any Converge-Requested Enhancement or associated Documentation under this Agreement.

            3.10 Acceptance. Each Converge-Requested Enhancement provided to Converge under a Final SOW will be subject to acceptance testing by Converge in accordance with the provisions of its corresponding Final SOW. All other Converge-Requested Enhancements provided to Converge under this Agreement will be deemed accepted by

                                        8

Converge upon Converge's receipt of the complete delivery thereof to a Converge computer located at a Converge place of business.

            3.11 Ownership; License to Vert. Unless otherwise expressly stated in an applicable Work Plan or Final SOW, Vert shall be the sole and exclusive owner of all Converge-Requested Enhancements, but excluding any portions thereof that are or were developed independently by Converge or its Affiliates (Converge-Independent Materials) and any portions thereof that are Converge Brand Features or Third-Party Materials. Except as the parties may otherwise agree in writing, Converge, to the extent it has the legal right to do so, hereby grants to Vert an irrevocable, perpetual, world-wide, non-exclusive right and license to use, load, store, transmit, execute, copy, market, distribute, in any medium or distribution technology whatsoever, known or unknown, display, perform and sublicense the Converge-Independent Materials and the Third-Party Materials, in both Source Code and Object Code formats, and to make unlimited





instantiations thereof, for any and all purposes. As used herein, Converge Brand Features means all logos, trademarks, service marks and trade names, brand names and other brand features of Converge and its licensors (other than Vert). As used herein, Third-Party Materials means any products or materials of third parties (including Converge's licensors and third-party contractors) to be incorporated into or provided as part of any Converge-Requested Enhancement. Converge shall use reasonable efforts to identify to VNE all relevant Third-Party Materials in the applicable Work Plan or Final SOW.

            3.12 License Rights of Converge. The scope of Converge's license rights to each Converge-Requested Enhancement shall be as set forth in the Subscription License Agreement and, if relevant, the applicable Final SOW. Except as may be set forth in the Subscription License Agreement or as the parties may otherwise expressly agree in writing, Converge acknowledges and agrees that Vert has no obligation to deliver Source Code for any Converge-Requested Enhancement, or to grant Converge any license to use the Source Code form of any Converge-Requested Enhancement.

            3.13 Installation and Configuration. Converge shall be responsible for installing and configuring any Converge-Requested Enhancements provided by VNE hereunder. Converge may request, and VNE will provide, reasonable assistance to Converge in its efforts to install and configure such Enhancements as part of the Professional Services provided hereunder.

            3.14 Third-Party Technology. Except as the parties may otherwise expressly agree in writing, Converge shall be responsible for paying for and, with VNE's assistance, securing license rights to any third-party technology required for the provision or use of any Converge-Requested Enhancements provided under this Agreement. Vert shall use reasonable efforts to identify to Converge all required license rights to third-party technology in the applicable Work Plan or Final SOW.

            3.15 Unforseen Costs and Expenses. Notwithstanding anything to the contrary in this Section 3, neither party shall be obligated to incur any costs or expenses in connection with the performance or implementation of a Work Plan or Final SOW unless such Work Plan or Final SOW reasonably contemplates that such party shall be responsible for such costs or expenses, or such party otherwise agrees in writing to incur such costs and expenses.

                                        9

            3.16 Escalation Procedures. Should the Converge Project Manager and the VNE Project Manager be unable to reach agreement on any matter within the scope of their discretion under this Section 3, the matter shall be escalated to the parties' respective Relationship Managers for discussion. In addition, should either party believe that the other party has failed to fulfill its obligations under Section 2 or this Section 3 above, the matter shall be escalated to the parties' respective Relationship Managers for discussion. The initial VNE Relationship Manager shall be William Swank and the initial Converge Relationship Manager shall be Francesco DeMarchis. Either party may change its Relationship Manager on notice (via e-mail or in some other reasonable fashion not necessarily in accordance with the express notice provisions of this Agreement) to the other party's Project Manager and Relationship Manager at any time, except that the Relationship Manager always shall be at the director level or higher.

      4. Fees and Payments.

            4.1 Minimum Fee During Initial Term. Converge shall pay to VNE a minimum fee of Four and One-Half Million Dollars ($4,500,000) for VNE's provision of the Services during the Initial Term (the Initial Term Minimum Fee). Converge shall pay the Initial Term Minimum Fee to VNE in 18 equal installments of Two Hundred Fifty Thousand Dollars ($250,000) (each, a Monthly Installment). Converge shall pay the first such Monthly Installment to VNE on the date this Agreement is executed and delivered by both parties. Thereafter, Converge shall pay each such Monthly Installment to VNE no later than the first day of each month during the Initial Term (November 2001 and through March 2003). All such Monthly Installments are non-refundable.

            4.2 Minimum Fee During Each Renewal Term. If the Parties mutually agree in writing to renew this Agreement pursuant to Section 9.1, the minimum fee payable by Converge to VNE during any such renewal period shall be as mutually determined by the Parties.

            4.3 Application of Quarterly Allocation; Out-Of-Scope Services. For each quarter during the Term of this Agreement that Converge pays the applicable Monthly Installments, Converge shall be entitled to receive Services in an amount equal to the Quarterly Allocation; provided, however, that VNE shall provide all Maintenance and Support Services with respect to Problem Reports (but not with respect to Support Requests) reported during such quarter, and all Maintenance Updates released by VNE during such quarter, regardless of whether the provision of such Services would cause VNE to exceed the Quarterly Allocation for such quarter; and provided further, however, that if Converge fails to make a Monthly Installment when due (subject to the cure period in Section 9.2(c)), VNE shall not be required to provided additional Services during the remaining portion of the applicable quarter until such payment is made. Should Converge request and VNE provide any Professional Services, or any Maintenance and Support Services with respect to Support Requests, that would cause VNE to exceed the Quarterly Allocation for any quarter, then Converge shall pay VNE's then-current time charges, or such other charges as the parties may otherwise agree in any Final SOW (Out-Of-Scope Services), for such Out-Of-Scope Services. VNE shall use commercially reasonable efforts to inform Converge that any Professional Services requested by Converge would be Out-Of-Scope Services prior to VNE's performance of such Professional Services.





Converge shall not be required to pay for and VNS shall not be required to perform any such Services that have not been approved in a Work Plan or Final SOW, or otherwise approved by Converge in writing.

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            4.4 Materials Costs and Expenses. Converge will reimburse VNE for all reasonable materials costs and expenses actually incurred by VNE in providing the Services under this Agreement, including travel and related expenses; provided, however, that VNE shall bear any travel or related expenses incurred by VNE at its sole option or as may be required in connection with the correction of any Error. Notwithstanding the foregoing, if travel is required due to the unavailability of remote access (see Section 2.9), then Converge shall reimburse VNE for the reasonable costs of such travel and related expenses. Upon Converge's request, the parties shall prepare budgets of any materials costs and expenses to be incurred by VNE in its performance of any Professional Services hereunder and any costs or expenses in excess of the applicable budgeted amounts shall be subject to Converge's written approval, such approval not to be unreasonably withheld or delayed. VNE's invoices for all travel and related expenses shall be reasonably itemized and list all such expenses by category/person/trip, and be accompanied by reasonable documentation sufficient to support the deductibility by Converge of the reimbursable expense.

            4.5 Invoicing and Payments. Converge shall pay the Monthly Installments to VNE on the dates specified in Section 4.1 and, if applicable, Section 4.2 above. All other amounts due under this Agreement will be invoiced by VNE to Converge on a monthly basis in arrears. All such invoiced amounts shall be due to VNE within 30 days following Converge's receipt of VNE's invoice. All payments will be made by Converge in U.S. dollars, without setoff, recoupment or deduction. All fees and other amounts not paid when due shall be subject to late charges of the lesser of (a) 1.5% per month of the overdue amount or (b) the maximum permitted under applicable law.

            4.6 Taxes. The fees and other payments specified in this Agreement are exclusive of any sales, use and other taxes on consumption of goods and services (Sales Taxes), however designated or levied, based on this Agreement, delivery of the Services under this Agreement, or Converge's or its Affiliates' use thereof. In those jurisdictions in which VNE determines it is required to register, collect and remit Sales Taxes, VNE will separately invoice Converge for such Sales Taxes (which invoices shall be payable by Converge as set forth in Section 4.5), collect such Sales Taxes from Converge and remit such Sales Taxes to the proper taxing authority. In those jurisdictions in which VNE has determined that it does not have a collection responsibility, Converge will be required to self-assess and remit any Sales Taxes due on the purchase of taxable property and services acquired under this Agreement. Converge will retain ultimate responsibility and liability for remitting any Sales Taxes due on the purchase of any property and/or services acquired under this Agreement, including, without limitation, any interest, penalties or additions attributable to or imposed on or with respect to any such assessment excluding any taxes imposed upon the net income of either party). Subject to the express provisions of this Agreement, the parties will cooperate and use their commercially reasonable efforts to minimize or avoid, to the maximum extent allowed by law, the obligation to pay any Sales Taxes that may be levied on payments made under this Agreement or otherwise are chargeable by any applicable government authority with respect to the Services.

            4.7 Tax Withholding. If laws, rules or regulations require withholding of any taxes imposed upon amounts payable to a party hereunder, the other party shall make such withholding payments as required and subtract such withholding payments from the amounts payable to such party. The other party shall submit reasonable proof of payment of the

                                       11

withholding taxes to such party within 30 days after obtaining such proof. The parties agree to fully cooperate with each other, including, without limitation, in the filing of appropriate certificates of tax exemption, to ensure that any withholding payments required to be made by the other party are reduced or avoided to the fullest extent permitted by law. Converge shall be deemed to be the sole payor of payments owed to VNE under this Agreement and shall not have the right to substitute any domestic or foreign affiliate for that purpose, and if Converge reincorporates or otherwise reorganizes as a foreign person that would thereupon cause payments hereunder to VNE to become subject to withholding, then Converge shall comply with applicable laws to the extent required and shall gross up the payments otherwise owed to VNE so that VNE receives, net of withholding taxes, the amounts VNE would have received if Converge had not substituted a foreign person or had remained a domestic person.

      5. Warranty.

            5.1 Services Warranty. VNE warrants that the Services provided hereunder will be provided in accordance with generally-accepted industry standards applicable to the performance of services of a similar nature. In the event of any breach of the foregoing warranty, and provided that Converge reports such breach to VNE in writing within 90 days following the date of performance of the Services in question, VNE shall, as its sole obligation and Converge's sole and exclusive remedy, promptly repair, replace or re-perform the Services in question, without additional cost to Converge, so as to correct the warranty non-compliance as promptly as practicable (within 30 days to the extent technically feasible).

            5.2 Disclaimer. WITH THE EXCEPTION OF THE EXPRESS WARRANTY PROVIDED





IN SECTION 5.1 AND AS THE PARTIES MAY OTHERWISE AGREE IN ANY WORK PLAN, VNI AND ALL AFFILIATES OF VNI SPECIFICALLY DISCLAIM ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY, ACCURACY, FITNESS FOR A PARTICULAR PURPOSE, QUIET ENJOYMENT AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS RELATING TO ANY SERVICES, MAINTENANCE UPDATES OR ENHANCEMENTS PROVIDED OR TO BE PROVIDED HEREUNDER.

      6. Limitation of Liability.

            6.1 Disclaimer of Liability for Certain Damages.

                  6.1.1 Consequential and Similar Damages. TO THE MAXIMUM EXTENT PERMITTED BY LAW, IN NO EVENT SHALL EITHER PARTY BE LIABLE OR OBLIGATED IN ANY MANNER FOR ANY SPECIAL, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES OF ANY KIND ARISING OUT OF OR RELATING TO THIS AGREEMENT (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, REVENUES OR BUSINESS OPPORTUNITIES) HOWEVER CAUSED AND REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT, NEGLIGENCE, STRICT PRODUCT LIABILITY, OR OTHERWISE, EVEN IF THE PARTY HAS BEEN INFORMED OF THE POSSIBILITY OF ANY SUCH DAMAGES IN ADVANCE. The foregoing limitation

                                       12

is independent of any exclusive remedies available to either party under this Agreement, including any failure of such remedies.

                  6.1.2 Loss of Data, Usage, Etc. VERT DOES NOT GUARANTEE THAT ANY MAINTENANCE UPDATES OR ENHANCEMENTS WILL OPERATE WITHOUT ERROR OR INTERRUPTION AND VERT SHALL NOT BE RESPONSIBLE FOR ANY DAMAGES ASSOCIATED WITH LOSS OF DATA OR INTERRUPTION OR LOSS OF USE OF ANY PRODUCTS, MAINTENANCE UPDATES OR ENHANCEMENTS RESULTING THEREFROM.

            6.2 Sole Remedy. IF A CLAIM OR CAUSE OF ACTION IS ATTRIBUTABLE TO ANY MAINTENANCE UPDATE, ENHANCEMENT OR SERVICES PROVIDED OR TO BE PROVIDED UNDER THIS AGREEMENT, THE REMEDIES SET FORTH IN THIS AGREEMENT, TO THE EXCLUSION OF THE REMEDIES SET FORTH IN THE SUBSCRIPTION LICENSE AGREEMENT, SHALL CONSTITUTE THE SOLE AND EXCLUSIVE REMEDIES AVAILABLE TO A PARTY FOR SUCH CLAIM OR CAUSE OF ACTION. IF A CLAIM OR CAUSE OF ACTION IS ATTRIBUTABLE TO A PRODUCT OR ANY SERVICES PROVIDED UNDER THE SUBSCRIPTION LICENSE AGREEMENT, THE REMEDIES SET FORTH IN THE SUBSCRIPTION LICENSE AGREEMENT, TO THE EXCLUSION OF THE REMEDIES SET FORTH IN THIS AGREEMENT, SHALL CONSTITUTE THE SOLE AND EXCLUSIVE REMEDIES AVAILABLE TO A PARTY FOR SUCH CLAIM OR CAUSE OF ACTION. For the sake of clarity, the parties acknowledge that claims concerning Vert's ownership of and Converge's license rights to any Maintenance Updates, Enhancements or associated Documentation shall be deemed to have arisen under the Subscription License Agreement, that claims with respect to VNE's delivery of any Vert-General Release Enhancements or associated Documentation, or the performance or non-performance of any Vert-General Release Enhancements, shall be deemed to have arisen under the Subscription License Agreement, and that claims with respect to VNE's delivery of any Maintenance Updates, Converge-Requested Enhancements or associated Documentation, or the performance or non-performance of any Maintenance Updates or Converge-Requested Enhancements, shall be deemed to have arisen under this Agreement. NO LIABILITY SHALL EXTEND UNDER THIS AGREEMENT TO ANY THIRD PARTY (INCLUDING, BUT NOT LIMITED TO, ANY AFFILIATES OF VNI OTHER THAN VNE, OR THEIR LICENSORS) IF NOT INVOLVED IN THE DEVELOPMENT OR DELIVERY OF ANY MAINTENANCE UPDATE, ENHANCEMENT OR SERVICES HEREUNDER.

            6.3 Maximum Aggregate Liability. TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE MAXIMUM LIABILITY OF EACH PARTY TO THE OTHER OR TO ANY THIRD PARTY FOR DAMAGES, IF ANY, RELATING TO THIS AGREEMENT OR ANY MAINTENANCE UPDATE, ENHANCEMENT OR SERVICES PROVIDED OR TO BE PROVIDED HEREUNDER, WHETHER FOR BREACH OF CONTRACT OR WARRANTY, STRICT LIABILITY, NEGLIGENCE OR OTHER TORT, STRICT PRODUCT LIABILITY, THE FAILURE OF ANY LIMITED REMEDY TO ACHIEVE ITS ESSENTIAL PURPOSE, OR OTHERWISE, SHALL NOT EXCEED (I) WITH RESPECT TO ANY ENHANCEMENT PROVIDED HEREUNDER, THE AMOUNTS PAID BY CONVERGE TO VERT FOR SUCH ENHANCEMENT, AND (II) WITH RESPECT TO ANY MAINTENANCE AND SUPPORT SERVICES, THE AMOUNTS PAID BY

                                       13

CONVERGE TO VERT FOR SUCH MAINTENANCE AND SUPPORT SERVICES DURING THE THREE MONTH PERIOD IMMEDIATELY PRECEDING THE DATE ON WHICH THE CLAIM OR CAUSE OF ACTION FOR ANY SUCH DAMAGES FIRST AROSE. THE FOREGOING LIMITATIONS ON EACH PARTY'S AGGREGATE LIABILITY TO THE OTHER SHALL BE IN ADDITION TO ANY FEES AND OTHER AMOUNTS DUE AND OWING UNDER SECTION 4. FOR PURPOSES OF THIS SECTION 6.3, THE TERM PARTY MEANS CONVERGE ON THE ONE HAND, AND VNI AND VNE COLLECTIVELY ON THE OTHER HAND, SO THAT AS TO VNI AND VNE THE LIMITATIONS IN THIS SECTION 6.3 ARE COLLECTIVE LIMITATIONS AND NOT SEPARATE LIMITATIONS FOR EACH OF VNI AND VNE.

            6.4 Exceptions. THE LIMITATIONS OF LIABILITY CONTAINED IN THIS SECTION 6 SHALL NOT APPLY WITH RESPECT TO (A) ANY CLAIMS OF BODILY INJURY OR DAMAGE TO TANGIBLE PERSONAL PROPERTY RESULTING FROM WILLFUL MISCONDUCT OR GROSS NEGLIGENCE, (B) ANY BREACH OF THE CONFIDENTIALITY OBLIGATIONS IN SECTION 7, OR (C) LIABILITY FOR PAYMENT OF INTEREST ADDED BY A COURT OF LAW OR AN ARBITRATION PANEL TO A JUDGMENT ENTERED IN ANY ACTION OR PROCEEDING UNDER THIS AGREEMENT.

            6.5 Duty to Mitigate. Each party will have a duty to take reasonable steps to mitigate damages for which the other party is responsible.

            6.6 Acknowledgement. Each of the parties acknowledge that the disclaimers and limitations set forth in this Section 6 are an essential element of this Agreement between the parties and that the parties would not have entered into this Agreement without such disclaimers and limitations.





      7. Confidential Information.

            7.1 Definition of Confidential Information. Confidential Information as used in this Agreement shall mean any and all proprietary or non-public information of a party whether in oral, written or other tangible form that the party disclosing the information (the Discloser) designates as being confidential or which, under the circumstances surrounding disclosure, the receiving party (the Recipient) knows or has reason to know should be treated as confidential.

            7.2 Nondisclosure and Nonuse Obligations. Each of the parties, as Recipient, agrees that such Recipient will not use, disseminate, or in any way disclose any Confidential Information of the other party, as Discloser, to any person, firm or business, except to the extent necessary for the performance of such party's obligations or the enjoyment of such party's rights and benefits hereunder, and for any other purpose such Discloser may hereafter authorize in writing. Each of the parties, as Recipient, agrees that such Recipient shall treat all Confidential Information of the other party, as Discloser, with the same degree of care as such Recipient accords to such Recipient's own Confidential Information, but in no case less than reasonable care. Each of the parties, as Recipient, agrees&bbsp;that such Recipient shall disclose Confidential Information of the other party, as Discloser, only to those of such Recipient's employees who need to know such information, and such Recipient certifies that such Recipient employees have

                                       14

previously agreed, either as a condition to employment or in order to obtain the Confidential Information of the Discloser, to be bound by terms and conditions substantially similar to those terms and conditions applicable to such Recipient under this Agreement. Each of the parties, as Recipient, shall immediately give notice to the other party, as Discloser, of any unauthorized use or disclosure of Discloser's Confidential Information. Each of the parties, as Recipient, agrees to assist the other party, as Discloser, in remedying any such unauthorized use or disclosure of Discloser's Confidential Information.

            7.3 Exclusions from Nondisclosure and Nonuse Obligations. The obligations under this Section 7 of each of the parties, as Recipient, with respect to any portion of the Confidential Information of the other party, as Discloser, shall not apply to such portion that Recipient can document: (a) was in the public domain at or subsequent to the time such portion was communicated to Recipient by Discloser through no fault of Recipient; (b) was rightfully in Recipient's possession free of any obligation of confidence at or subsequent to the time such portion was communicated to Recipient by Discloser; (c) was developed by employees or agents of Recipient independently of and without reference to any information communicated to Recipient by Discloser; or (d) was communicated by Discloser to an unaffiliated third party free of any obligation of confidence. A disclosure by either of the parties, as Recipient, of Confidential Information of the other party, as Discloser, either (i) in response to a valid order by a court or other governmental body; (ii) as otherwise required by law; or (iii) as necessary to establish the rights of either party under this Agreement, shall not be considered to be a breach of this Agreement by Recipient or a waiver of confidentiality for other purposes; provided, however, that Recipient shall provide prompt prior written notice thereof to Discloser to enable Discloser to seek a protective order or otherwise prevent such disclosure.

            7.4 Confidentiality of this Agreement. The parties hereto agree to keep the terms of this Agreement confidential and not to divulge any part thereof to any third party except: (a) with the prior written consent of the other party; (b) to any governmental body having jurisdiction to request and to read the same; (c) as otherwise may be required by law or legal process; or (d) to legal counsel representing either party. Notwithstanding the foregoing, no disclosure of this Agreement shall be made pursuant to clauses (b) or (c) of the foregoing sentence without the disclosing party first giving the other party reasonable notice prior to the intended disclosure so as to allow the other party sufficient time to seek a protective order or otherwise assure the confidentiality of this Agreement as that other party shall deem appropriate. Each party agrees not to file this Agreement as an exhibit to its SEC filings without first redacting and requesting confidential treatment for any information reasonably considered by the other party to be confidential. Such other party shall inform the first party of any such information it wishes to redact and request confidential treatment for within five Business Days following the date such other party is requested to do so in writing. Nothing herein shall prohibit either party from complying with applicable securities or other laws, rules or regulations.

      8. Non-Solicitation. During the Term of this Agreement and for a period of one year thereafter, Converge and Vert each agree not to directly or indirectly solicit, encourage or cause others to solicit or encourage any employees or individual independent contractors of the other party to terminate their employment or independent contracting relationship with the other party and become an employee or independent contractor of the soliciting party or its Affiliate. This provision does not prohibit a party's responding to unsolicited employment inquiries and/or any

                                       15

indirect solicitations and other employment activities (e.g., job postings, advertising of positions) that are not specifically targeted at any particular individual.





      9. Term; Events of Default; and Termination.

            9.1 Term. The initial period of this Agreement (the Initial Term) shall commence upon the Effective Date and continue until March 31, 2003. Thereafter, this Agreement shall renew only upon the mutual written agreement of the parties for up to three additional renewal terms of one year each (each, a Renewal Term). Notwithstanding the foregoing provisions of this Section 9.1, in the event any Services or other obligations of either party (including payment obligations) with respect to any Final Work Plan have not been completed or discharged as of the date on which this Agreement would otherwise expire, this Agreement shall remain in effect solely with respect to such Work Plan until such Services or other obligations have been completed or discharged.

            9.2 Events of Default. The occurrence of any one or more of the following acts, events or occurrences shall constitute an Event of Default under this Agreement: (a) either party becomes insolvent, files for bankruptcy or is subjected to involuntary bankruptcy proceedings that are not dismissed within 60 days, or makes a general assignment for the benefit of its creditors; (b) either party breaches any material provision of this Agreement and the result is the non-breaching party experiencing a substantial deprivation of the benefits to which the non-breaching party is entitled under this Agreement, which material breach is not cured by the breaching party within 30 days after the breaching party's receipt of the non-breaching party's written notice specifying the breach in detail; provided, however, that if the breach is of such a nature that it may be cured, but it may not reasonably be cured within such 30-day period, the non-breaching party may not terminate this Agreement unless such breach is not cured by the breaching party on or before the 60th day after the breaching party's receipt of the non-breaching party's notice of breach if breaching party has commenced substantial efforts to cure the breach within the initial 30-day period and has continued in good faith to work to cure the breach as soon as reasonably practicable thereafter, or (c) Converge fails to pay when due any amounts payable under Section 4 and fails to cure such breach within 3 Business Days after VNE gives Converge written notice specifying the breach.

            9.3 Termination. Immediately upon the occurrence of an Event of Default by either party, the other party shall have the right, but not the obligation, to terminate this Agreement, exercisable by such other party giving written notice thereof to first party within 10 Business Days after the occurrence of such Event of Default. In addition, this Agreement shall automatically terminate upon any termination of the Subscription License Agreement as permitted thereunder.

            9.4 Effect of Termination. Upon the expiration or termination of this Agreement, each party shall erase, destroy or return to the other party all copies of the Confidential Information of or provided by such party under this Agreement and, upon such other party's written request, shall certify its compliance with this Section 9.4 to the other party in writing. Notwithstanding the foregoing provisions of this Section 9.4, with respect to and for so long as any licenses granted to Converge respecting Deployed Products and/or Source Code under the Subscription License Agreement survive the expiration or termination of this

                                       16

Agreement, Converge shall not be required to erase, destroy or return any Confidential Information of Vert or its Affiliates respecting such Deployed Products and/or Source Code.

            9.5 Effect of Vert Non-Renewal Election. If VNE or VNI is unwilling to renew this Agreement on its existing terms for any Renewal Term, a Vert Non-Renewal Election shall be deemed to have occurred. In the event of a Vert-Non-Renewal Election, in addition to any rights or remedies that may be available to Converge under the Subscription License Agreement, the provisions of Section 8 above shall cease to apply with respect to Converge's solicitation or encouragement of any of the VNE Service Personnel to terminate their employment or independent contracting relationship with VNE and become an employee or independent contractor of Converge or its Affiliate.

            9.6 Effect of Converge Non-Renewal Election. If VNE or VNI is willing to renew this Agreement on its existing terms for any Renewal Term, but Converge elects not to renew this Agreement for any for any reason, a Converge Non-Renewal Election shall be deemed to have occurred. In the event of a Converge-Non-Renewal Election, the rights or remedies that may be available to Converge under the Subscription License Agreement, if any, shall apply.

            9.7 Survival. Sections 3.11, 3.12, 4.1, 4.2, 4.6, 4.7, 5.2, 6, 7, 8, 9.4, 9.5, 9.6, 9.7 and 10 shall survive any expiration or termination of this Agreement. In addition, all payment obligations under Section 5 that pertain to Services provided or otherwise accrue prior to the effective date of expiration or termination of this Agreement shall survive such expiration or termination.

      10. General.

            10.1 Notices. All notices permitted or required under this Agreement (Notices) shall be in writing and shall be delivered as follows with notice deemed given as indicated (a) by personal delivery when delivered personally; (b) by overnight courier upon written verification of receipt; or (c) by certified or registered mail, return receipt requested, five days after deposit in the mail. All Notices shall be properly addressed as follows, or to such other addresses as may be specified in a Notice given hereunder:

If to VNI or VNE:                         with a copy to:





Attn: General Counsel                     Attn: Michael L. Pillion VerticalNet, Inc.                         Morgan, Lewis & Bockius, LLP 507 Prudential Road                       1701 Market Street Horsham, Pennsylvania 19044               Philadelphia, Pennsylvania 19103

                                       17

If to Converge:

Attn: General Counsel Converge, Inc. Four Technology Drive Peabody, MA  01960

            10.2 Force Majeure. Except for the obligation to pay monies due, neither party shall be liable hereunder by reason of any failure or delay in the performance of its obligations hereunder (except for the payment of money) on account of strikes, riots, insurrection, fires, flood, storm, explosions, acts of God, war, governmental action, labor conditions, earthquakes, or any other cause which is beyond the control of such party.

            10.3 Waiver. An effective waiver under this Agreement must be in writing signed by the party waiving its right. The failure of either party to require performance by the other party of any provision hereof shall not affect the full right to require such performance at any time thereafter; nor shall the waiver by either party of a breach of any provision hereof be taken or held to be a waiver of subsequent breaches of that or any other provision hereof.

            10.4 Severability. In the event that any provision of this Agreement shall be unenforceable or invalid under any applicable law or be so held by applicable court decision, such unenforceability or invalidity shall not render this Agreement unenforceable or invalid as a whole, and, in such event, such provision shall be changed and interpreted so as to best accomplish the objectives of such provisions within the limits of applicable law or applicable court decisions.

            10.5 Headings. The section headings appearing in this Agreement are inserted only as a matter of convenience and in no way define, limit, construe or describe the scope or extent of such section or in any way affect such section.

          &sbsp; 10.6 Choice of Law; Waiver of Jury Trial; Limitation of Action. This Agreement and performance under this Agreement shall be governed by the laws of the United States of America and of the Commonwealth of Pennsylvania as applied to agreements entered into and to be performed entirely within Pennsylvania between Pennsylvania residents, excluding its conflicts of law provisions. The United Nations Convention on Contracts for the International Sale of Goods is specifically excluded from application to this Agreement. The parties expressly waive any right to a jury trial regarding disputes related to this Agreement. Unless otherwise provided by local law without the possibility of contractual waiver or limitation, any legal or other action related to this Agreement must be commenced no later than two years from the date on which the cause of action arose.

            10.7 No Agency. Nothing contained herein shall be construed as creating any agency, partnership or other form of joint enterprise between the parties or to allow either party to bind the other or incur any obligation on its behalf.

            10.8 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute

                                       18

one and the same instrument. This Agreement shall become binding when any one or more counterparts hereof, individually or taken together, bear the signatures of both parties hereto. For the purposes hereof, a facsimile copy of this Agreement, including the signature pages hereto, shall be deemed an original.

            10.9 Assignment. A party may assign this Agreement to any Affiliate. Otherwise, neither party may assign this Agreement without the other party's prior written consent (not to be unreasonably withheld). No transfer of this Agreement by operation of law or change in Control of a party, including, without limitation, by merger, consolidation or sale or other transfer of equity interests, shall be considered an assignment for purposes of this Section 11.9. This Agreement will bind and inure to the benefit of the parties and their respective successors and permitted assigns.

            10.10 No Third-Party Beneficiaries. Nothing in this Agreement is intended to confer benefits, rights or remedies unto any person or entity other than the parties and their successors and permitted assigns.

            10.11 Non-Exclusive Agreement. Except as expressly stated herein, this Agreement is not exclusive as to either party, and, subject to the express provisions of this Agreement, each party will have the right to conduct any other business in which it may now or hereafter be engaged.

            10.12 Entire Agreement. This Agreement, together with the Subscription License Agreement and the other agreements referenced therein, are the entire agreement between Vert and Converge relating to the subject matter of this Agreement. This Agreement shall supersede any prior agreement or





understanding, whether written or oral, and any other communications between Vert and Converge relating to the subject matter of this Agreement. This Agreement may only be amended by a writing specifically referencing this Agreement, which has been signed by authorized representatives of each party.

                                       19

      IN WITNESS WHEREOF, the undersigned do hereby execute this parties have caused this Agreement to be signed by their duly authorized representatives as of the date first written above in this Agreement.

VerticalNet, Inc.                            Converge, Inc.

By:__________________________________        By:________________________________

_____________________________________        ___________________________________ (Print Name)                                 (Print Name)

Title:_______________________________        Title:_____________________________

VerticalNet Enterprises LLC

By:__________________________________

_____________________________________ (Print Name)

Title:_______________________________

                                       20

                                    Exhibit A                            Severity Levels of Problems

The following chart describes the distinctions between the different severity levels for Problems reported by Converge.

Severity    Definition Level           1           A Severity Level 1 Problem is one where critical or central             functionality of the Supported Product is unavailable and the             Supported Product cannot reasonably be used, or performance of             critical or central functionality of the Supported Product is             severely degraded, and in either such case Converge does not have or             cannot implement a reasonable workaround. The adverse impact of a             Severity 1 Problem on Converge's business is severe and immediate,             and requires an immediate solution. A Severity Level 1 Problem may             have one or more of the following characteristics, in each case             without Converge being able to implement a reasonable workaround:

            -     Data is corrupted or lost by the Supported Product, or the                   Supported Product returns incorrect results, and such                   corruption, loss or incorrect results have a material adverse                   impact on critical or central functionality of the Supported                   Product             -     Complete or severe lack of ability to use the critical or                   central functionality of the Supported Product             -     The Supported Product crashes repeatedly             -     Critical or central functionality of the Supported Product is                   not operational or is severely degraded             -     Critical or central functionality of the Supported Product                   fails to run to completion

2           A Severity Level 2 Problem is one where critical or central             functionality of the Supported Product is unavailable, or             performance of critical or central functionality of the Supported             Product is severely degraded, but in either such case Converge can             implement a reasonable workaround but such workaround does not             downgrade the Problem to Severity Level 3 or 4. Use of critical or             central functionality of the Supported Product can continue in a             restricted fashion through use of such workaround, but the user             still experiences a significant degradation of performance of such             functionality. A Severity Level 2 Problem may have one or more of             the characteristics of a Severity Level 1 Problem, but critical or             central functionality of

            -     the Supported Product can continue to operate in a restricted                   fashion through use of such workaround.

3           A Severity Level 3 Problem causes minimal interruption to             non-central or non-important functionality. The Problem has a minor             impact or is inconvenient. A Severity Level 3 Problem may have one             or more of the following characteristics:

            -     Performance of the Supported Product is degraded in a                   non-critical manner             -     Performance of the Supported Product is minimally impaired





                                       21

          4           A Severity Level 4 Problem causes no loss of use of the Supported             Product. The following would be Severity Level 4 Problems:

            -     Cosmetic problem with the Supported Product             -     Documentation error             -     Minor incorrect behavior of the Supported Product that does                   not impede its operation

                                       22

                                    Exhibit B                      Problem Response and Resolution Efforts

SEVERITY        RESPONSE TIME AND STATUS REPORTS               RESOLUTION EFFORTS  LEVEL                                                              1            -   Initial Response (defined                -   Continuous efforts (24x7) with                     below) within 30 minutes after                 best available resources to                     the Problem is reported to VNE                 provide a workaround, patch,                     if the Problem is reported                     fix or other solution for the                     during Support Hours.                          Problem as quickly and                 -   Initial Response within two                    efficiently as possible,                     hours if the Problem is                        beginning as soon as                     reported to VNE outside of                     practicable after diagnosis of                     Support Hours, or within 30                    the Problem commences.                     minutes following the                      -   If a workaround, patch, fix or                     resumption of Support Hours,                   other solution is not provided                     whichever is sooner.                           within 24 hours after                 -   Diagnosis commences as soon as                 diagnosis of the Problem                     is reasonably practicable.                     commences, provide Converge                 -   Status reports every 24 hours                  with an assessment and action                     thereafter.                                    plan detailing the proposed                                                                    method of resolution and a                                                                    time schedule for delivery of                                                                    a correction.                                                                -   Severity Level 1 requires                                                                    maximum effort support until                                                                    an emergency fix or bypass is                                                                    developed and available for                                                                    shipment to Converge. Critical                                                                    situations may require                                                                    customer, Converge and VNE                                                                    personnel to be at their                                                                    respective work locations or                                                                    available on an                                                                    around-the-clock basis.                                                                -   Provide a final patch, fix or                                                                    other solution within 24 hours                                                                    that down grades the Problem                                                                    to Severity Level 3 or less                                                                    and that does not                                                                    substantially impair                                                                    performance or functionality.

   2            -   Initial Response within two                -   Continuous efforts during                     hours after the Problem is                     Support Hours to provide a                     reported to VNE if the Problem                 patch, fix or other solution                     is reported during Support                     for the Problem as quickly and                     Hours.                                         efficiently as possible,                 -   Initial Response within two                    beginning as soon as                     hours after the resumption of                  practicable after diagnosis of                     Support Hours if the Problem                   the Problem commences.                     is reported to VNE outside of              -   If a patch, fix or other                     Support Hours.                                 solution is not provided                 -   Diagnosis commences within one                 within 48 hours after                     Support Day after the Problem                  diagnosis of the Problem                     is reported to VNE.                            commences, provide Converge                 -   Status reports every other                     with an assessment and action                     Support Day thereafter.                        plan detailing the proposed                                                                    method of resolution and a                                                                    time schedule for delivery of                                                                    a correction.                                                                -   Provide a final patch, fix or                                                                    other solution within 72 hours                                                                    that down grades the Problem                                                                    to Severity Level 3 or less                                                                    and that does not                                                                    substantially impair                                                                    performance or functionality.

   3            -   Initial Response by the end of             -   Reasonable efforts during                     the Support Day immediately                    Support Hours to provide a                     following the day on which the                 workaround, patch, fix or                     Problem is reported to VNE.                    other solution for the Problem                 -   Diagnosis commences within two                 within five Support Days,





                    Support Days after the Initial                 beginning within a reasonable                     Response                                       period of time after diagnosis                 -   Progress and status reports as                 of the Problem commences.                     appropriate thereafter, but at                     least weekly.

   4            -   Reasonable efforts to commence             -   Reasonable efforts to resolve                                                                    the Problem in a

                                       23

SEVERITY        RESPONSE TIME AND STATUS REPORTS               RESOLUTION EFFORTS  LEVEL                                                                               diagnosis of the Problem                       future Maintenance Update.                     within five Support Days after                     the Problem is reported to                     VNE.                 -   Progress and status reports as                     appropriate thereafter.

For purposes of this Exhibit B, Initial Response means (a) communication back to the Converge Support Personnel by the appropriate VNE personnel acknowledging receipt of the applicable Problem Report; and (b) consistent with the nature and extent of the information provided by Converge to VNE, communication by VNE to the Converge Support Personnel of VNE's initial analysis of the nature and/or cause of the Problem and suggestions for a possible temporary or interim solution to the Problem, including any interim work-around or other temporary quick fix.

                                       24

                                    Exhibit C                  Quarterly Allocation and VNE Support Personnel

                                                              ESTIMATED        ESTIMATED        ESTIMATED VERTICALNET            TITLE                PERCENTAGE        HOURS PER        NUMBER OF          TOTAL TEAM MEMBER                                  OF TIME            WEEK             WEEKS            HOURS                                                                                   Stephen              Project Manager           50%               20               12               240 DePalantino

Mike Decker          Support Mgr               50%               20               12               240

Christian            Programmer Analyst        50%               20               12               240 Torstensson

Roland Ngokila       Programmer Analyst        50%               20               12               240

Ken Ridler           Programmer Analyst        100%              40               12               480

Kelley Nelson        Programmer Analyst        100%              40               12               480                                                                                                   ----                      TOTAL HOURS             &bbsp;                                                    1920                                                                                                   ====

Upon notice (via e-mail or in some other reasonable fashion not necessarily in accordance with the express notice provisions of this Agreement) to and in consultation with the Converge Project Manager, VNE shall be entitled to replace (or substitute temporarily for) the VNE Service Personnel identified above. Any replacement personnel shall be reasonably qualified to perform the Services they are to perform under this Agreement, and VNE will use reasonable efforts to maintain continuity of assignment with respect to the VNE personnel assigned to provide essential Services. VNE shall use commercially reasonable efforts to limit the replacement of (or substitution for) the persons identified above during the 90 day period immediately following the Effective Date. VNE, in the reasonable discretion of the VNE Project Manager, shall make Mark Rodriguez reasonably available to perform any Maintenance and Support Services that would be materially benefited by his participation, and, notwithstanding the foregoing sentence, VNE shall be free to substitute Mark Rodriguez for any of the persons identified above for such purposes.

                                       25 
Question: Highlight the parts (if any) of this contract related to Warranty Duration that should be reviewed by a lawyer. Details: What is the duration of any  warranty against defects or errors in technology, products, or services  provided under the contract?

Answer:
In the event of any breach of the foregoing warranty, and provided that Converge reports such breach to VNE in writing within 90 days following the date of performance of the Services in question, VNE shall, as its sole obligation and Converge's sole and exclusive remedy, promptly repair, replace or re-perform the Services in question, without additional cost to Converge, so as to correct the warranty non-compliance as promptly as practicable (within 30 days to the extent technically feasible).