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

Example Input: DISTRIBUTOR AGREEMENT

                                    by and between

                        PEREGRINE/BRIDGE TRANSFER CORPORATION

                                         and

                                  NEON SYSTEMS, INC.

                                  TABLE OF CONTENTS

                                                                            Article 1   Definitions . . . . . . . . . . . . . . . . . . . . . . . . . .    1 Article 2   License Grant . . . . . . . . . . . . . . . . . . . . . . . . .    2 Article 3   Pricing and Payment . . . . . . . . . . . . . . . . . . . . . .    4 Article 4   Order, delivery and Acceptance. . . . . . . . . . . . . . . . .    4 Article 5   Representations and Warranties of Licensee. . . . . . . . . . .    5 Article 6   Representations and Warranties of Licensor. . . . . . . . . . .    6 Article 7   Covenants of Licensee . . . . . . . . . . . . . . . . . . . . .    6 Article 8   Covenants of Licensor . . . . . . . . . . . . . . . . . . . . .    9 Article 9   Indemnification . . . . . . . . . . . . . . . . . . . . . . . .   10 Article 10  Agreement Not to Compete, Confidentiality . . . . . . . . . . .   12 Article 11  Audits. . . . . . . . . . . . . . . . . . . . . . . . . . . . .   13 Article 12  Limited Warranties. . . . . . . . . . . . . . . . . . . . . . .   14 Article 13  Liability . . . . . . . . . . . . . . . . . . . . . . . . . . .   15 Article 14  Term and Termination. . . . . . . . . . . . . . . . . . . . . .   16 Article 15  General . . . . . . . . . . . . . . . . . . . . . . . . . . . .   18

                                       EXHIBITS

          Exhibit A         List of Products           Exhibit B         The Territory           Exhibit C         Sublicense Agreement           Exhibit D         Agreement for Trial

                                      i

                                DISTRIBUTOR AGREEMENT

DISTRIBUTOR AGREEMENT (the Agreement) is made as of the 1st day of January, 1996 by and between Peregrine/Bridge Transfer Corporation, a Delaware corporation (the Licensor), and Neon Systems, Inc., a Delaware corporation (the Licensee).

WHEREAS, Licensor is engaged in the development, support and licensing of certain computer software products, including without limitation the computer software products fisted in EXHIBIT A to this Agreement; and

WHEREAS, Licensee desires to obtain from Licensor, and Licensor desires to grant to Licensee, the right to market and sublicense the Licensed Products (as defined herein) in accordance with the terms and conditions set forth in this Agreement;

NOW THEREFORE, in consideration of the foregoing and the mutual covenants set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

                                      ARTICLE 1                                      DEFINITIONS

1.1  Customer means a person or entity that has acquired, or has indicated its      interest in acquiring from Licensee, or from a Redistributor if so      specified herein, a non-exclusive and nontransferable Sublicense to use one      (1) or more of the Licensed Products.

1.2  Documentation means all visually readable materials published or made      available by Licensor during the term of this Agreement for use by      Customers in connection with the Licensed Products.

1.3  Emergency Fix means a temporary correction of a problem in a Licensed      Product reported by Licensee to Licensor that may take the form of a      written instruction or magnetic or optical media.

1.4  Licensed Product means any copy, or part thereof, of object code of the      software products listed on EXHIBIT A attached to this Agreement, as well      as any Upgrades or other material distributed to Licensee by Licensor in      connection with such software products.





1.5  Master Copy means the initial object code copy of each Licensed Product      and of any subsequent Upgrades or other derivations distributed to Licensee      by Licensor under this Agreement.

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1.6  Redistributor means any individual or entity that is granted a license by      Licensee to copy and sublicense one or more Licensed Products to Customers.

1.7  Sublicense means the sublicense agreement to be entered into by      Customers, the form of which is attached hereto as EXHIBIT C, or such form      as otherwise may be approved by Licensor pursuant to this Agreement.

1.8  Sublicense Copy means an object code copy of the Licensed Product that      Licensee licenses from Licensor and inventories for sublicensing to      Redistributors and Customers.

1.9  Territory means that geographic area specified in EXHIBIT B attached to      this Agreement.

1.10 Upgrade means any revision, adaptation or new version of a Licensed      Product which enhances a Licensed Product and which is offered by Licensor      to registered users of that Licensed Product as an upgrade.

                                      ARTICLE 2                                     LICENSE GRANT

Section 2.1    USE OF MASTER COPY.  Licensor hereby grants to Licensee a non- exclusive, worldwide right to use and reproduce the Master Copy of each Licensed Product and the related Documentation during the term of this Agreement for testing, demonstration to Redistributors. and Customers, support and maintenance, if any, back-up and archive purposes.

Section 2.2    SUBLICENSING.  Licensor hereby grants to Licensee an exclusive in the Territory to (1) make Sublicense Copies and copies of the Documentation to meet the demand of Redistributors and Customers and (2) market and sublicense Sublicense Copies and copies of the Documentation, together with any copies of promotional and other materials which Licensor may produce or obtain from time to time to assist Licensee in marketing and sublicensing the Licensed Products during the term of this Agreement by any one or more of the following means:

     (a)  TO A REDISTRIBUTOR: To a Redistributor pursuant to a Redistributor           Agreement containing substantially the same terms and conditions as           are set forth in this Agreement (subject to Section 2.5) and a           Sublicense with each Customer of Redistributor in accordance with           subsection 2.2(b); or

     (b)  TO CUSTOMERS: Pursuant to a Sublicense signed by the Customer.

Section 2.3    AGREEMENTS FOR TRIAL.  Licensee may make available the Licensed Products or Documentation to any Redistributor or Customer who wishes to test the Licensed Products on a trial basis so long as such Redistributor or Customer has entered into an Agreement For Trial with Licensee in the form attached to this Agreement as EXHIBIT D.

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Section 2.4    MAINTENANCE AND SUPPORT AGREEMENTS.  Licensee may make available to Customers maintenance, support and upgrade services only under the terms contained in the Sublicense or other written maintenance and support agreement pertaining to such services.

Section 2.5    REVIEW OF ARRANGEMENTS.  Licensee shall not enter into any agreement referred to in this Article 2 with any Redistributor or Customer until each such agreement has been submitted to and approved by Licensor.  Within five (5) business days after its receipt of any such agreement, Licensor shall notify Licensee whether it approves or disapproves of the agreement and, if it disapproves of the agreement, Licensor shall provide written notice of the reasons therefor, including any changes that would require to approve of the agreement.  If Licensor fails to notify Licensee of its approval or disapproval of any such agreement within such period of time, the agreement shall be deemed to be approved by Licensor.

Section 2.6    TERMS OF AGREEMENTS.  Licensee shall ensure that the terms of any Redistributor Agreement and, to the extent a Sublicense must be modified to comply with applicable law, any Sublicense executed in connection with the Licensed Products do not:

     (a)  Diminish or limit any of the rights of Licensor in the Licensed           Products or Documentation;

     (b)  Diminish or limit the enforceability of the proprietary rights of           Licensor in and to the Licensed Products or Documentation;

     (c)  Convey any rights of ownership in the Licensed Products or           Documentation to any individual or entity other than Licensor, except           for the license rights granted in accordance with the terms of this           Agreement;

     (d)  Permit the use or duplication of the Licensed Products or





          Documentation, except as specifically provided in this Agreement or in           the Sublicense; or

     (e)  Permit disclosure of proprietary information regarding the Licensed           Products or Documentation.

Section 2.7    NATURE OF GRANT.  Licensee shall not have any rights of ownership or other proprietary rights in the Licensed Products or any Documentation by virtue of this Agreement, except for the license grants set forth herein.

Section 2.8    TRADEMARKS AND COPYRIGHT.  Licensor hereby grants to Licensee a non-exclusive right to use the trademarks, service marks, trade names, copyrights, logos and designations (collectively, the Marks) relating to the Licensed Products or the Documentation during the term of this Agreement in the marketing by Licensee of the Licensed Products, provided that such Marks clearly indicate Licensor as the owner of the Marks whenever the Licensed Product or Documentation is first mentioned in any written material referencing the Licensed Product and the proper symbol is used in a superscript following the Marks.  Licensor promptly shall provide

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a list of all Marks held by Licensor that relate to the Licensed Products.   Upon reasonable written request by Licensor, Licensee shall provide Licensor  with samples of any use of the Marks of Licensor relating to the Licensed  Products, including any documentation and object code copies of the Licensed  Products that Licensee sublicenses to Redistributors and Customers.

                                      ARTICLE 3                                  PRICING AND PAYMENT

Section 3.1    FEES TO LICENSOR.

     (a)  Licensee shall pay to Licensor for each Licensed Product licensed to a           Redistributor or a Customer a licensee fee equal to 50% of all            revenues received (without deduction for value added tax, if any, but           excluding any revenues for maintenance and support or upgrade            services, which revenues are covered in paragraph (b) below) by            Licensee under the Redistributor Agreement or Sublicense applicable           to such Licensed Product.

     (b)  Licensee shall pay to Licensor for maintenance and support and upgrade           services provided under the applicable Sublicense or other written           maintenance and support agreement with or approved by Licensee for           each of the Licensed Products a fee equal to 50% of all revenues           received (without deduction for value added tax, if any) by Licensee           from a Redistributor or Customer relating to maintenance and support           services or services for Upgrades or upgrades of systems for such           Licensed Product.

Section 3.2    TERMS OF PAYMENT.  All fees due to Licensor under this Agreement shall be paid in U.S. Dollars.  Fees due to Licensor from invoices rendered by Licensee during the first year of the term hereof will be payable one hundred and twenty (120) days after the date of the Licensee's invoice to a Redistributor or Customer, as the case may be.  Fees due to Licensor from invoices rendered on or after the first day of the thirteenth (13th) month through and including the last day of the eighteenth (18th) month of the term hereof will be payable ninety (90) days after the date of such invoice.  Fees due to Licensor from invoices rendered thereafter will be payable sixty (60) days after the date of such invoice.  Any amount that is not paid when due will bear simple interest from the date such amount is due until the date payment is made at a rate equal to 10% per annum.

                                      ARTICLE 4                             ORDER, DELIVERY AND ACCEPTANCE

Section 4.1    ORDER AND DELIVERY.  Licensee shall deliver to Licensor product orders (or other documents of similar purpose and effect) in writing that are signed by an authorized representative of Licensee and that list the quantity, product name, number, version, license fee and

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proposed delivery date for such order.  Licensor shall ship Licensed Products  and Documentation in accordance with Licensee's product orders received and  accepted by Licensor.  Licensor shall ship Licensed Products and  Documentation F.O.B. Licensor's place of business.  Licensee shall be  responsible for all customs fees and other costs and expenses arising in  connection with the transactions contemplated by this Agreement, including  costs and expenses related to packing and shipping the Licensed Products and  Documentation and any freight and insurance charges, and Licensor may require  Licensee to pay for such costs and expenses in advance of shipment of any  Licensed Products or Documentation.  Licensor shall not be liable to Licensee  for delays in shipments due to causes beyond Licensor's reasonable control.   Licensor reserves the right to reject any product order, to cancel any  product orders placed by Licensee and accepted by Licensor and to refuse or  delay shipment thereof if Licensee fails to make any payments as provided in  this Agreement or otherwise continues to fail to comply with the terms and  conditions of this Agreement for thirty (30) days after delivery of written





notice of such failure.

Section 4.2    TIME FOR ACCEPTANCE.  Licensee shall accept or reject the Licensed Products or Documentation within a ten (10) day evaluation period after receipt of such Licensed Product and the related Documentation by Licensee.  If Licensee fails to give Licensor written notice of its rejection of such Licensed Products or Documentation within such ten (10) day evaluation period or Licensee ships such Licensed Products or Documentation to a Redistributor or Customer, then such Licensed Products and Documentation will be deemed to be accepted by Licensee.

Section 4.3    REJECTION.  If Licensee rejects any Licensed Product in accordance with Section 4.2 because such Licensed Product fails to conform to the Documentation relating to such Licensed Product, Licensee shall notify Licensor promptly in writing to that effect and return all copies of such Licensed Product to Licensor with a certification by an authorized representative of Licensee that all copies have been returned to Licensor or have been destroyed and Licensor shall refund to Licensee the amount paid by Licensee to Licensor for such Licensed Products.

                                      ARTICLE 5                       REPRESENTATIONS AND WARRANTIES OF LICENSEE

Section 5.1    AUTHORITY.  Licensee represents and warrants that it is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and that it is duly qualified to transact business and is in good standing in each jurisdiction in which such qualification is required by applicable law, except where the failure to be so qualified would not have a material adverse effect on Licensee or the assets of Licensee.  Licensee represents and warrants that it has all requisite power and authority to execute this Agreement and to consummate the transactions contemplated hereby and that this Agreement has been duly executed and delivered by Licensee and constitutes a valid and binding obligation of Licensee enforceable in accordance with its terms.

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Section 5.2    ABILITY TO PERFORM.  Licensee represents and warrants that it has sufficient facilities, resources and personnel to adequately perform its obligations under this Agreement and that no existing arrangement, contractual or otherwise, will cause Licensee to breach the terms of this Agreement or prevent Licensee from fulfilling its obligations under this Agreement.

                                      ARTICLE 6                       REPRESENTATIONS AND WARRANTIES OF LICENSOR

Section 6.1    AUTHORITY.  Licensor represents and warrants that it is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and that it is duly qualified to transact business and is in good standing in each jurisdiction in which such qualification is required by applicable law, except where the failure to be so qualified would not have a material adverse effect on Licensor or the assets of Licensor.  Licensor represents and warrants that it has all requisite power and authority to execute this Agreement and to consummate the transactions contemplated hereby and that this Agreement has been duly executed and delivered by Licensor and constitutes a valid and binding obligation of Licensor enforceable in accordance with its terms.

Section 6.2    TITLE TO LICENSED PRODUCTS.  Licensor represents and warrants that it possesses all right, title and interest in and to the Licensed Products and the Documentation and that the use of each of the Licensed Products and the Documentation by Licensee, a Redistributor or a Customer will not in any way constitute an infringement or other violation of any copyright, trade secret, trademark, patent or other intellectual property fights or any proprietary information or nondisclosure or other rights of any third party.  Licensor represents and warrants that no existing arrangement, contractual or otherwise, will cause Licensor to breach the terms of this Agreement or prevent Licensor from fulfilling its obligations under this Agreement.

                                      ARTICLE 7                                 COVENANTS OF LICENSEE

Section 7.1    DUTIES OF LICENSEE.  Licensee shall be solely responsible for the proper advertising, demonstration, shipment, export and collection of payment relating to the Licensed Products and Documentation in the Territory.  The duties of Licensee include without limitation the following:

     (a)  Advertising the Licensed Product in appropriate media, contacting and           developing Customers and prospective Redistributors by telephone and           otherwise, providing information concerning Licensed Products to           Customers and prospective Redistributors and advising such Customers           and prospective Redistributors on the selection and use of the           Licensed Products.

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     (b)  Complying with Licensee's warranty obligations as set forth in its





          agreements with Redistributors and Customers.

     (c)  Sending at Licensee's expense qualified and appropriate personnel of           Licensee to participate in training sessions, which shall be conducted           by Licensor from time to time without charge to Licensee for the           benefit of Licensee and Licensee's personnel.

     (d)  Obligating each Redistributor to keep complete and accurate records of           such Redistributor's Customers, leads to prospective Customers, the           number and type of Licensed Products licensed by such Redistributor           and such related operating and financial data as Licensor reasonably           may request from time to time for the sole purpose of monitoring the           Licensed Products.

Section 7.2    DOCUMENTATION.  Licensee shall represent accurately and completely the Licensed Products to Customers as to quality, function, purpose and compatibility in accordance with the Documentation whenever the Licensed Products are referenced, demonstrated or advertised.  Licensee shall obtain prior written approval from Licensor for all materials other than the Documentation to be used by Licensee in connection with trials, demonstrations and agreements relating to the Licensed Products, and such approval shall not be unreasonably withheld or delayed by Licensor.  Licensee shall give Licensor and any licensors of Licensor appropriate credit for the authorship of the Licensed Products and Documentation at any seminar, trade show or other presentation of the Licensed Products.

Section 7.3    EXPORTING AND SHIPMENT.  Licensee shall obtain prior written approval from Licensor and any required export licenses from the United States Department of Commerce, Office of Export Administration or other applicable domestic or foreign governmental agency before exporting any Licensed Product or Documentation from the United States.  Licensee agrees and covenants to comply fully with all applicable laws, rules and regulations, and to adopt such policies and procedures in connection with, the exporting of the Licensed Products and Documentation as may be required thereby.  Each party to this Agreement shall cooperate fully with the other party to this Agreement and any governmental authorities by giving consents or information or providing or executing such documents as reasonably may be required to comply fully with such laws, rules or regulations existing now or in the future.

Section 7.4    TAXES AND TARIFFS.

     (a)  Licensee shall pay any and all taxes (other than taxes on Licensor's           net income), tariffs, import and export duties or other fees imposed           or assessed in connection with the transactions contemplated by this           Agreement, including the delivery of Licensed Products and           Documentation to Licensee and the shipment of Licensed Products from           Licensee to a Redistributor or Customer.

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     (b)  in the event that Licensee is required by law to withhold any form of           tax, tariff or duty from any amount payable to Licensor under this           Agreement, then Licensee shall provide Licensor with copies of all           documentation required in connection with such withholdings and shall           provide to Licensor all assistance requested by Licensor in applying           for relief from such withholding obligations and in substantiating           corresponding tax, duty or tariff credits or deductions which may be           available to Licensor with respect to such withholding under           applicable law.

Section 7.5    BOOKS AND RECORDS.  Licensee shall keep proper records and books of account concerning the reproduction and sublicensing of the Licensed Products that are adequate to determine the amount of fees owed to Licensor and Licensee shall preserve such records and books in a safe place for a period of five (5) years following termination of this Agreement.

Section 7.6    MONTHLY REPORT.  On or prior to the fifteenth (15th) day of each calendar month Licensee shall deliver to Licensor a written report certified as true and correct by an authorized office of Licensee stating (a) each Agreement for Trial entered into by Licensee during the previous calendar month, together with the expected revenues, if any, to Licensee under each such agreement, (b) each Sublicense entered into by Licensee during the previous calendar month, together with the expected revenues to Licensee for each such Sublicense, (c) each Redistributor Agreement entered into by Licensee during the previous calendar month, together with the expected revenues to Licensee for each such agreement, and (d) a list of invoices, together with the dollar amounts thereof, sent by Licensee to each Redistributor and Customer during the previous calendar month.

Section 7.7    FINANCIAL STATEMENTS.  Licensee shall provide (but shall not be obligated to do so more frequently than twice annually) to Licensor financial statements, credit ratings or other evidence of Licensee's financial condition promptly upon written request of Licensor.

Section 7.8    REPLACEMENTS.  Licensee shall honor any proper refund or replacement requests received for the Licensed Products from Redistributors pursuant to the applicable Redistributor Agreement or from Customers pursuant to a Sublicense.  Upon receipt of any such properly returned Licensed Products, Licensor shall refund to Licensee the amount paid by Licensee to Licensor for such Licensed Products.  Licensee shall instruct Redistributors and Customers to direct all refund requests directly to Licensee rather than Licensor.

Section 7.9    MODIFICATIONS.  Licensee shall not make any modifications to or





derivations of the Licensed Products without the prior written consent of Licensor, except in the case of an Emergency Fix.  Licensee shall not reverse engineer or otherwise attempt to reproduce the source code of any Licensed Product.  In the event that Licensee makes any modification, alteration or enhancement to the Licensed Product or Documentation (including but not limited to an Emergency Fix), such modification, alteration or enhancement, including all intellectual property rights thereto, will be and remain the sole and exclusive property of Licensor.  Any suggestions or changes desired by Licensee to the Licensed Product or Documentation shall be made by

                                      8

Licensee in writing to Licensor and, if incorporated into the Licensed  Product or Documentation, shall be the property of Licensor.

Section 7.10   COPYRIGHT AND OTHER PROPRIETARY NOTICES.  Licensee shall ensure that the copyright, trademark and any other proprietary notices of Licensor or other legends contained in or on any copies of the Licensed Products or Documentation remain in or on the original Licensed Product or Documentation and any copies of such product or documentation reproduced by Licensee.  The existence of any copyright, trademark or other proprietary notices in or on the Licensed Product or Documentation shall not be construed as a publication of the Licensed Product or Documentation.

Section 7.11   NO ENCUMBRANCES.  Licensee shall not engage in the lease, transfer, rental or loan of the Licensed Products or Documentation and Licensee shall not allow the Licensed Products or Documentation to become encumbered by any means.

Section 7.12   NO INCONSISTENT WARRANTIES.  Licensee shall not, and shall obligate Redistributors not to, make or pass on to Customers any warranty or representation on behalf of Licensor inconsistent with or in addition to the limited warranty contained in the Sublicense.

Section 7.13   DISPUTES BETWEEN LICENSEE AND CUSTOMERS.  Licensee shall notify Licensor promptly concerning any threatened legal proceedings between Licensee on the one hand and a Redistributor or a Customer on the other hand and of any legal notices served on, or legal actions commenced against, Licensee regarding the Licensed Products or Documentation which might affect Licensor.  Licensee shall not institute proceedings or enter into a compromise with any third party with whom it is in dispute concerning the Licensed Products or Documentation without the prior written consent of a duly authorized officer of Licensor, which consent shall not be unreasonably withheld or delayed by Licensor.

Section 7.14   TRANSLATION.  Licensee shall not translate any portion of the Licensed Products, including any Documentation, into any other language without the prior written permission of Licensor.

Section 7.15   INTELLECTUAL PROPERTY REGISTRATION.  Without the prior written consent of Licensor, Licensee shall not register, apply for registration or in any other way attempt to obtain any intellectual property rights relating to any Licensed Product, any Documentation or any part thereof or take any action that materially and adversely affects such rights held by Licensor.

                                      ARTICLE 8                                 COVENANTS OF LICENSOR

Section 8.1    Licensor shall be solely responsible for delivering to Licensee a Master Copy of each Licensed Product and Documentation and for the maintenance and support of the

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Sublicense Copies and Documentation used by any Redistributors and Customers.  The duties of Licensor include the following:

     (a)  Delivering a Master Copy of each Licensed Product and Documentation,           including any Upgrades as they become available, to permit Licensee to           (1) make Sublicense Copies and copies of the Documentation to meet the           demand of Redistributors and Customers and (2) market and license           Sublicense Copies and copies of the Documentation, together with the           copies of promotional and other materials which Licensor may produce           from time to time in order to assist Licensee in marketing and           sublicensing the Licensed Products during the term of this Agreement.

     (b)  Employing a sufficient number of skilled technicians experienced in           the computing industry and familiar with the Licensed Products and           Documentation to provide adequate technical support and assistance to           all Redistributors and Customers.

     (c)  Providing competent instruction to Redistributors and Customers           regarding the use and installation of the Licensed Products.

     (d)  Providing information, including by means of telephone support, to           Redistributors and Customers as to the proper procedures and persons           to contact to enable the proper installation and operation of the           Licensed Products and providing responsive answers to questions and           problems regarding the use and operation of the Licensed Products.





     (e)  Providing technical assistance in supporting the Licensed Products and           correcting any errors in the Licensed Products on an ongoing basis.

     (f)  Delivering to Licensee sample copies of all Licensor's marketing and           licensing materials relating to the Licensed Products in use in the           United States of America for copying and distribution in the Territory           at Licensee's expense.

Section 8.2    REGISTRATION FOR TRADEMARKS AND COPYRIGHTS.  Licensor shall use its best efforts to register in its name all Marks relating to the Licensed Products in the Territory and Licensor shall bear all costs of such registration and the maintenance and enforcement of all such rights and shall notify Licensee from time to time of all successful and unsuccessful registrations.

                                      ARTICLE 9                                    INDEMNIFICATION

Section 9.1    INDEMNIFICATION OF LICENSOR.  Licensee hereby agrees to defend and indemnify Licensor and Licensor's officers, directors, employees, stockholders, agents and representatives

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against, and agrees to hold them harmless from, any loss, liability, claim,  damage or expense (including reasonable legal fees and expenses incurred  therein or in enforcing the indemnity), as incurred, for or on account of or  arising from or in connection with or otherwise with respect to any breach of  any representation, warranty or covenant of Licensee contained in this  Agreement or any document delivered in connection herewith.

Section 9.2    INDEMNIFICATION OF LICENSEE.  Licensor hereby agrees to defend and indemnify Licensee and Licensee's officers, directors, employees, stockholders, agents and representatives against, and agrees to hold them harmless from, any loss, liability, claim, damage or expense (including reasonable legal fees and expenses incurred therein or in enforcing the indemnity), as incurred, for or on account of or arising from or in connection with or otherwise with respect to any breach of any representation, warranty or covenant of Licensor contained in this Agreement or any document delivered in connection herewith.

Section 9.3    INDEMNIFICATION PROCEDURE.  Promptly after acquiring knowledge of any loss, action, suit, investigation, proceeding, demand, assessment, audit, judgment or claim against Licensor or Licensee, or as to which Licensor or Licensee may be liable, a party entitled hereunder to be indemnified shall give written notice thereof to the party obligated hereunder to provide indemnification.  The indemnifying party at its own expense promptly shall defend, contest or otherwise protect against any damage, loss, deficiency, liability, claim, encumbrance, penalty, cost, expense, action, suit, investigation, proceeding, demand, assessment, audit, judgment or claim made by a third party against which such indemnifying party has agreed to indemnify any indemnified party, and each indemnifying party shall receive from the indemnified party all necessary and reasonable cooperation in said defense, including without limitation the services of employees of the indemnified party who are familiar with the transactions out of which any such damage, loss, deficiency, liability, claim, encumbrance, penalty, cost, expense, action, suit, investigation, proceeding, demand, assessment, audit, judgment or claim may have arisen.  The indemnified party shall have the right to control the defense of any such third party proceeding unless it is relieved of its liability hereunder with respect to such defense by the indemnified party.  The indemnified party shall have the right to employ separate counsel in any such action and to participate in the defense thereof, but the fees and expenses of such counsel shall not be at the expense of the indemnifying party if the indemnifying party has assumed the defense of the action with counsel reasonably satisfactory to the indemnified party; provided that the fees and expenses of the indemnified party's counsel shall be at the expense of the indemnifying party if (i) the employment of such counsel has been specifically authorized in writing by the indemnifying party or (ii) such indemnified party shall have been advised by counsel hat there is a conflict of interest or issue conflict involved in the representation by counsel employed by the indemnifying party in the defense of such action on behalf of the indemnified party or that there may be one or more legal defenses available to such indemnified party which are not available to the indemnifying party (in which case the indemnifying party shall not have the fight to assume the defense of such action on behalf of such indemnified party, it being understood, however, that the indemnifying party shall not be liable, in connection with any one such action or separate but substantially similar or related actions in the same Jurisdiction arising out of the same general allegations or circumstances, for the

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reasonable fees and expenses of more than one separate firm of attorneys for  the indemnified party, which firm shall be designated in writing by the  indemnified party).  The indemnifying party shall have the right, at its  option and unless so relieved, to compromise, at its own expense by its own  counsel, any such matter involving the asserted liability to a third party of  the indemnified party.  In the event that the indemnifying party shall  undertake to compromise any such asserted liability, the indemnifying party  shall notify the indemnified party promptly of its intention to do so.  In  the event that an indemnifying party after written notice from an indemnified





party fails to take timely action to defend any such damage, loss,  deficiency, liability, claimed encumbrance, penalty, cost, expense, action,  suit, investigation, proceeding, demand, assessment, audit, judgment or  claimed the indemnified party shall have the right to defend the same by  counsel of its own choosing but at the cost and expense of the indemnifying  party.  In the event that the indemnified party defends such an asserted  liability, it shall not compromise any such asserted liability without the  written consent of the indemnifying party, such consent not to be  unreasonably withheld or delayed.

Section 9.4    FURTHER REMEDIES FOR INFRINGEMENT.  If Licensee is prevented from its normal use of any Licensed Product or Documentation by injunction or court order arising from, relating to or in connection with any alleged or actual infringement on the intellectual property rights of a third party relating to any Licensed Product or Documentation, then Licensor at its option and in addition to the other remedies contained in this Agreement and at no expense, loss or damage to Licensee shall (a) replace such Licensed Product or Documentation free of any such infringement, (b) modify such Licensed Product or Documentation so that it is free of any such infringement or (c) procure for the benefit of Licensee, whether by license or other release of claim of infringement, the fight to make Sublicense Copies and copies of the Documentation to meet the demand of Redistributors and Customers and to market and sublicense Sublicense Copies and copies of the Documentation.

                                      ARTICLE 10                       AGREEMENT NOT TO COMPETE, CONFIDENTIALITY

Section 10.1   NONCOMPETITION.  Each of Licensor and Licensee understands and acknowledges that Licensor shall be entitled to protect and preserve the going concern value of Licensor's business to the extent permitted by law and that Licensor would not have entered into this Agreement absent the provisions of this Section 10.1 and, therefore, each of Licensor and Licensee agrees that during the term of this Agreement Licensee shall not engage in, represent in any way or be connected with directly or indirectly any business competing with the Licensed Products.

Section 10.2   CONFIDENTIAL INFORMATION.  Licensee understands and agrees that the Licensed Products and any related information marked Confidential constitute valuable intellectual property and trade secrets of Licensor and embody substantial creative efforts and confidential information, ideas and expressions belonging to Licensor.  Licensor understands and agrees that

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any reports supplied pursuant to this Agreement by Licensee to Licensor  relating to the Licensed Products contain proprietary information of  Licensee.  The Licensed Products and related information and such reports are  referred to collectively in this Agreement as the Confidential Information.  Each party to this Agreement shall observe at all times complete  confidentiality with regard to the Confidential Information of the other  party to this Agreement held by such party and shall not permit or authorize  access to or disclosure of any such Confidential Information to any other  person or entity other than such party's employees and consultants who have  executed confidentiality agreements with terms substantially similar to this  Agreement.  This Section 10.2 will not apply to any Confidential Information  that is required to be disclosed by applicable law or any Confidential  Information that becomes (a) public other than by virtue of a breach of this  Section 10.2 or (b) available to such party from another source (other than  any independent contractor engaged by such party to audit pursuant to this  Agreement the records of the other party hereto) that is not subject to a  confidentiality agreement with the other party hereto of which such party at  that time is aware.

Section 10.3   UNAUTHORIZED USE.  Each party to this Agreement shall notify the other party to this Agreement promptly in writing of the existence of any circumstances surrounding any unauthorized knowledge, possession or use of the Confidential Information by any person or entity other than the parties to this Agreement and each of their authorized employees and consultants.

Section 10.4   REMEDY.  Notwithstanding any other provision of this Agreement, each of the parties to this Agreement understands and agrees that the remedy of indemnity payments pursuant to this Agreement and other remedies at law would be inadequate in the case of any breach of the covenants contained in this Article 10 and each party to this Agreement agrees that the other party to this Agreement shall be entitled to equitable relief, including the remedy of specific performance, without posting of bond or other security, with respect to any breach or attempted breach of such covenants.

                                      ARTICLE 11                                         AUDITS

Section 11.1   AUDITS.  During the term of this Agreement and the five (5) year period immediately following termination of this Agreement, Licensor will have the right, at its own expense, to audit and examine Licensees records concerning either (a) the reproduction and sublicensing of the Licensed Products and the resulting fees due to Licensor or (b) compliance by Licensee with its obligations as to confidentiality under this Agreement.  During the term of this Agreement and the five (5) year period immediately following termination of this Agreement, Licensee will have the right, at its own expense, to audit and examine Licensor's records concerning compliance by Licensor with its obligations as to confidentiality under this Agreement.  Any such audit shall be





conducted during normal business hours, upon at least three business days prior written notification to the party to be audited stating the purpose of the audit

                                        13

and in such a manner so as to not unreasonably interfere with such party's business operations.  The auditing party shall keep any and all information derived from any audits confidential.  Such information is deemed to be Confidential Information within the meaning of Article 10.  In relation to such information, the parties to this Agreement are subject to the obligations and remedies set forth in Article 10.  The auditing party shall not use such information for any purpose other than the purpose of the audit as stated in such party's written notification for such audit.  If an audit of Licensee's records and books of account reveals that Licensee has underpaid the fees due under this Agreement to Licensor for the period under audit, Licensee shall pay to Licensor promptly the amount of the underpayment.  If the amount of underpayment for the period under audit exceeds five percent (5%) of the total amount owed during such period, Licensee shall reimburse Licensor for all costs and expenses incurred by Licensor in connection with performing the audit.

                                      ARTICLE 12                                   LIMITED WARRANTIES

Section 12.1   NO DEFECTS.  For twelve (12) months after delivery of the Master Copy of each Licensed Product to Licensee, Licensor warrants that the media in which the Licensed Products are stored shall be free from defects in materials and workmanship, assuming normal use.  Licensee may return any defective media to Licensor for replacement free of charge during such twelve (12) month period.

Section 12.2   PERFORMANCE.  For twelve (12) months after delivery of any Licensed Product to a Customer, whether Customer receives such Licensed Product from Licensee or a Redistributor, Licensor warrants that each Licensed Product will perform as described in the applicable Documentation.  If Licensee or any Redistributor or Customer discovers any errors or discrepancies in the Licensed Products from the Documentation during the twelve (12) month warranty period, Licensee shall notify Licensor promptly in writing of such error or discrepancy in sufficient detail to enable Licensor to recreate the error or discrepancy.  If the error or discrepancy is found by Licensee prior to the expiration of the ten (10) day evaluation period set forth in Section 4.2, such evaluation period shall be extended ten (10) days from the date of receipt by Licensee of the corrected Licensed Product from Licensor.

Section 12.3   DUTIES UNDER WARRANTY.  If Licensee or any Redistributor or Customer discovers any error in any Licensed Product or discrepancy in any Licensed Product from the Documentation that results in a material loss of performance in the Licensed Product within the twelve (12) month warranty period, then Licensor shall provide Licensee with the correction or method of resolving such error or discrepancy provided that Licensor shall not be responsible for any error or discrepancy caused by failure to use the Licensed Products as specified in the Documentation or any modifications made to any Licensed Product by or on behalf of a party other than Licensor.  If such error or discrepancy is not resolved within thirty (30) days after Licensee's

                                     14

written notice to Licensor, then Licensee as its sole remedy may (a) extend  the correction period to a date which is agreeable to Licensor and Licensee  or (b) return all copies of the Licensed Products to Licensor with a  certification by an authorized representative of Licensee that all copies  have been returned to Licensor or have been destroyed and that Licensee has  not retained any copies thereof and Licensor shall refund to Licensee the  amount paid by Licensee to Licensor for such Licensed Products.  Licensee  shall pay for all services rendered by Licensor in connection with the  Licensed Products or Documentation that are not covered or at that time are  no longer covered by the warranty described in this Agreement.

Section 12.4   EXCLUSIVE REMEDIES.  THE REMEDIES SPECIFIED ABOVE SHALL BE THE SOLE AND EXCLUSIVE REMEDIES OF LICENSEE REGARDING THE LICENSED PRODUCTS.  LICENSOR SPECIFICALLY DISCLAIMS ANY AND ALL OTHER WARRANTIES OF ANY KIND, EXPRESS, RAPLIED OR STATUTORY, INCLUDING ANY WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.  LICENSOR SPECIFICALLY MAKES NO REPRESENTATIONS REGARDING THE SUITABILITY OF THE LICENSED PRODUCTS FOR THE REQUIREMENTS OF ANY REDISTRIBUTOR.  OR CUSTOMER CONCERNING CAPACITY, INTERCONNECTIVITY, EXPANDABILITY OR PERFORMANCE.

                                      ARTICLE 13                                       LIABILITY

Section 13.1   LIMIT OF LIABILITY.  Licensor's total liability to Licensee under any provision of this Agreement shall be limited to the amount actually paid by Licensee to Licensor for the Licensed Product giving rise to the liability.  The existence of claims or suits against more than one Licensed Product shall not enlarge or extend the limit.  The parties to this Agreement acknowledge that each of them relied upon the inclusion of this limitation in consideration of entering into this Agreement.  IN NO EVENT SHALL A PARTY TO THIS AGREEMENT BE LIABLE TO THE OTHER PARTY TO THIS AGREEMENT FOR ANY SPECIAL, INDIRECT,





INCIDENTAL OR CONSEQUENTIAL DAMAGES RESULTING FROM THE USE, OR INABILITY TO USE, THE LICENSED PRODUCTS OR ARISING OUT OF THIS AGREEMENT, INCLUDING BUT NOT LMTED TO LOSS OF PROFIT OR OTHER MONETARY LOSS, LOSS OR INTERRUPTION OF DATA OR CONTUTER TIME, ALTERATION OR ERRONEOUS TRANSNUSSION OF DATA OR PROGRAM ERRORS, EVEN IF SUCH PARTY IS ADVISED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGES.

                                         15

                                      ARTICLE 14                                  TERM AND TERMINATION

Section 14.1   TERM.  This Agreement shall be effective until the earlier of (a) its termination in accordance with the provisions of this Article 14 or (b) the date that is two (2) years after the date of this Agreement; provided, however, that this Agreement will renew automatically for successive terms of one (1) year each unless a party to this Agreement delivers written notice of termination to the other party to this Agreement at least sixty (60) days prior to the end of the original or any renewal term or the parties to this Agreement do not agree in writing to the Quota Amount referred to in subsection 14.2(b)(1) for any one (1) year renewal term at least sixty (60) days prior to the commencement of such term.

Section 14.2    TERMINATION.

(a) Either party to this Agreement may terminate this Agreement:

    (1)   Immediately upon written notice if the other party to this Agreement           becomes insolvent, is the subject of a petition in bankruptcy that is           not resolved within thirty (30) days, admits in writing its inability            to pay its debts, makes an assignment for the benefit of creditors,            ceases doing business or attempts an unauthorized assignment of this            Agreement; or

    (2)   Immediately upon written notice if the other party to this Agreement           performance of any obligation under this Agreement, including failure            to promptly pay any amount due hereunder, and fails to cure such            default within thirty (30) days after delivery of written notice            specifying the default (with any termination as a result of Licensee's           failure to pay amounts due under this Agreement resulting in the            acceleration of Licensee's obligation to pay all sums due to Licensor            under this Agreement).

(b) Licensor may terminate this Agreement:

    (1)   Upon ninety (90) days prior written notice if Licensee does not enter            into Sublicenses and other agreements relating to the Licensed            Products with Redistributors and Customers that result in fees payable           to Licensor hereunder in an aggregate amount equal to or greater than            the Quota Amount for any year during the term hereof.  As used herein,           the term Quota Amount means $50,000 for each of the first and second           years of the original term of this Agreement and an amount agreed to            in writing by the parties hereto in respect of any subsequent one year           renewal term (provided that such amount equals or exceeds $50,000).             If Licensor fails to deliver notice of termination pursuant to this            subsection 14.2(b)(1) within six (6) months after the end of the term           to which such termination relates, Licensor will be deemed to have            waived such termination right in respect of such term (but not in            respect of subsequent terms); or

    (2)   Upon thirty (30) days prior written notice if Licensee enters into an           agreement or other arrangement relating to the merger of Licensee with           another entity, the acquisition of the majority of Licensee's issued            and outstanding capital stock or the acquisition of substantially all           of the assets of Licensee.

Section 14.3   DUTIES UPON TERMINATION.  Upon the termination or expiration of the term of this Agreement, the parties shall have the following rights and obligations:

     (a)  Within five (5) days of written demand by Licensor to Licensee,           Licensee shall return or destroy all copies of the Licensed Products           and any materials associated with the Licensed Products in Licensee's           possession or control, except that Licensee may retain sufficient           copies of the Master Copy of each Licensed Product in object code form           to enable Licensee to meet its maintenance and support obligations to           its Customers, if any.

     (b)  Licensee immediately shall cease any use, reproduction, sublicensing           or distribution of the Licensed Products or the Documentation.

                                     16

     (c)  Within five (5) days of Licensor's written request, Licensee shall           certify in a writing reasonably acceptable to Licensor that except as           set forth in this Agreement all copies of the Licensed Products and           related material have been delivered to Licensor, destroyed or           rendered unusable.

     (d)  Licensee shall not use any Licensed Product or Documentation as part           of any other product that Licensee may use, sublicense or distribute





          and Licensee shall cease any use of the Marks associated with the           Licensed Products or Documentation.

     (e)  All valid Redistributor Agreements and Sublicenses by and between           Licensee and any Redistributors and Customers will remain and continue           in full force and effect for the remainder of their respective terms,           and at Licensor's option Licensee shall assign to Licensor its rights           in such agreements with respect to the Licensed Products or           Documentation; provided that if Licensor fails to provide reasonable           support to any Redistributor or Customer, Licensee may support such           Redistributor or Customer without payment of fees to Licensor.

     (f)  Licensee promptly shall account for and pay to Licensor all amounts           due and owing pursuant to the terms of this Agreement and provide           Licensor with all outstanding reports due under this Agreement.

     (g)  Licensee immediately shall cease holding itself out as having any           connection with any Licensed Product or Licensor, unless Licensee at           that time has a connection with Licensor by reason other than this           Agreement.

     (h)  Licensee shall report to Licensor in reasonable detail the status of           all negotiations with prospective Redistributors and Customers or           leads to prospective Redistributors and Customers and all services           which Licensee is obligated to provide to any Redistributors or           Customers.

Section 14.4   RIGHTS NOT EXHAUSTIVE. The fights and remedies of Licensor included in this Article 14 shall not be exclusive and are in addition to any other rights and remedies provided by law or equity.

Section 14.5   SURVIVAL.  The provisions of Articles 9, 10 and 11, Section 7.5 and this Section 14.5 and all obligations of Licensee to pay any amounts to Licensor under this Agreement will survive the termination of this Agreement.

                                       17

                                      ARTICLE 15                                        GENERAL

Section 15.1   NATURE OF RELATIONSHIP.  The relationship existing between Licensee and Licensor is one of an independent contractor, and this Agreement shall not be construed as creating a partnership, joint venture, agency relationship or as granting a franchise under federal or any state law.  Each of Licensee and its officers, employees or other representatives shall not enter into or attempt to enter into any obligation on behalf of Licensor.  Licensee shall not make any representations to any Redistributors or Customers with respect to the Licensed Products and Documentation, including without limitation representations as to any warranty, covenant or other terms or conditions relating to licensing of the Licensed Products, unless such representations are made (a) in strict accordance with this Agreement or (b) with the prior written consent of Licensor.

Section 15.2   NOTICES.  All notices and other communications hereunder shall be in writing and shall be deemed delivered (i) when delivered if delivered personally or by overnight courier or telecopier with proof of delivery or (ii) three (3) days after such communication is deposited in the United States mail with postage prepaid, if delivered, if mailed by registered or certified mail (return receipt requested) to the parties to this Agreement at the following addresses (or at such other address for a party as shall be specified by like notice):

     (a)  if to Licensor, to

          Peregrine/Bridge Transfer Corporation            14141 Southwest Freeway, Suite 6200            Sugar Land, Texas 77478           Attn:     President

     and

     (b)  if to Licensee, to

          Neon Systems, Inc.           14141 Southwest Freeway, Suite 6200            Sugar Land, Texas 77478           Attn: President

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Section 15.3   INTERPRETATION.  When a reference is made in this Agreement to an Article, Section, subsection or Exhibit, such reference shall be to an Article, Section, subsection or Exhibit of this Agreement unless otherwise indicated.  The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words include, includes or including are





used in this Agreement, such term shall be deemed to be followed by the words without limitation. All accounting terms not defined in this Agreement shall have the meanings determined by generally accepted accounting principles.

Section 15.4   COUNTERPARTS  This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when two or more counterparts have been signed by each of the parties to this Agreement and delivered to the other parties to this Agreement, it being understood that all such parties need not sign the same counterpart.  For purposes hereof, delivery shall be deemed effective upon exchange of signed copies of this Agreement by facsimile, provided that originally signed counterparts of this Agreement are transmitted promptly to the other parties hereto.

Section 15.5   ENTIRE AGREEMENT, THIRD PARTY BENEFICIARIES. This Agreement (including the documents and instruments referred to herein) (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, between the parties hereto with respect to the subject matter hereof and (b) is not intended to confer upon any person (including any Redistributor or Customer) other than the parties hereto any rights or remedies hereunder, except as provided in Article 9.

Section 15.6   GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE SIATE OF TEXAS.

Section 15.7   ASSIGNMENT.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto without the prior written consent of the other party to this Agreement; provided, however, that Licensor may assign this Agreement to a subsidiary or entity controlling, controlled by or under common control with Licensor.   Subject to the preceding sentence, this Agreement will be binding upon,  inure to the benefit of and be to this Agreement and their respective  successors and permitted assigns.

Section 15.8   SEVERABILITY.  If any provision of this Agreement, or any portion of any provision hereof, shall be deemed invalid or unenforceable pursuant to a final determination of any court of competent jurisdiction or as a result of future legislative action, such determination or action shall be construed so as not to affect the validity or enforceability hereof and shall not affect the validity or effect of any other portion hereof

Section 15.9   AMENDMENT.  This Agreement may be amended only by a written instrument duly signed by each of the parties hereto.

                                      19

Section 15.10  WAIVER.  Any of the terms, covenants, representations, warranties or conditions of this Agreement may be waived only by a written instrument signed by the party to this Agreement waiving compliance.  No waiver by any party to this Agreement of any condition or breach of any term, covenant, representation or warranty contained in this Agreement, whether by conduct or otherwise, in any one or more instances, shall be construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of the breach of any other term, covenant, representation or warranty set forth in this Agreement.

IN WITNESS WBEREOF, the parties hereto have executed this Agreement as of the date first above written.

                                   LICENSOR:                                    PEREGRINE/BRIDGE TRANSFER

                                   By: /s/ Charles E Noell                                       ----------------------------------                                    Name: Charles E Noell                                         --------------------------------                                    Title: General Partner                                          -------------------------------

                                   LICENSEE:

                                   NEON SYSTEMS, INC.

                                   By: /s/ F. Joseph Backer                                       ----------------------------------                                    Name: F. Joseph Backer                                         --------------------------------                                    Title: CEO                                          -------------------------------

                                   20

                                     EXHIBIT B                                    THE TERRITORY

                        The Territory included is worldwide.
Example Output: 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?

Example Input: Exhibit 10.18   MAINTENANCE AGREEMENT   MAINTENANCE AGREEMENT (this Agreement), dated as of July 23, 2003, made by Universal Access, Inc., a corporation organized and existing under the laws of the State of Delaware (the Company), and CityNet Telecommunications, Inc., a corporation organized and existing under the laws of the State of Delaware (the Provider). All capitalized terms used herein and not otherwise defined shall have the meaning set forth in the Purchase Agreement (as defined below).   WITNESSETH:   WHEREAS, the Provider and the Company entered into that certain Stock Purchase Agreement (the Purchase Agreement) by and between the Provider and the Company dated as of April 7, 2003;   WHEREAS, pursuant to the Purchase Agreement, the Provider will transfer the Fiber Ring Assets to the Company upon the Closing;   WHEREAS, as a condition to the Closing, the Provider and the Company agreed to enter into this Agreement;   NOW, THEREFORE, in consideration of the mutual agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:   SECTION 1 TERM OF AGREEMENT   1.1. Initial Term. This Agreement commences on the date first above written, and will remain in effect for the period of five (5) years, except as otherwise provided herein.   1.2. Extension of Term. This Agreement will extend automatically for monthly periods unless either party to this Agreement notifies the other party in writing at least thirty (30) days before the expiration of the then current term.   1.3 Termination of Term. Notwithstanding the foregoing, either party may terminate this Agreement at any time without liability by providing one hundred eighty (180) days written notice to the other party.   SECTION 2  DESCRIPTION OF SERVICES AND FEES   2.1. Services.   (a) The Provider or its affiliate will provide the Company, with respect to the Fiber Ring Assets, all maintenance services (including but not limited to jetwashing and related ancillary services) required under the Provider's license agreements with the municipalities in which the Fiber Ring Assets are located (each a City Rights Agreement), and monitoring, emergency response and emergency splicing (collectively, the Services). If a





  service call is required to restore the Fiber Ring Assets to good operating condition, the Company will notify the Provider promptly after it becomes aware of the service affecting problem.   (b) The Services shall not include any of the following:   (i) remedial or preventive maintenance service performed outside that expressly defined in this Section 2.1;   (ii) repair of damage or loss resulting from accident, neglect, misuse or abuse or causes other than ordinary use by the Company for the purpose for which any of the Fiber Ring Assets was designed (collectively, Repairs); provided that Services do include Repairs if the damage or loss is caused by the Provider;   (iii) making specification or field engineering changes;   (iv) unless authorized in writing by the Provider, services resulting from, or which are impractical for the Provider to render because of, any adjustment, repair, maintenance, modification or alteration of the Fiber Ring Assets by any person other than the Provider; and   (v) service calls required to restore any of the Fiber Ring Assets to good operating condition, if the Company fails to notify the Provider of a need for service within one (1) day of the Company's knowledge of such need, and such delay has made the provision of the Services more costly.   2.2. Availability of the Services and Repairs. The Provider will be available to provide the Services 24 hours per day, seven (7) days per week. Periodically during the term of this Agreement, the Provider will provide to the Company contact information and reasonable protocols to be followed in order to schedule performance of the Services.   2.3. Fees. In each of the first twelve months of this Agreement, the Company shall pay to the Provider $40,000 per month in exchange for the Services (the Service Fee). Upon each anniversary of the commencement of this Agreement, the Service Fee shall be increased by a percentage that reflects the actual increases in the Provider's cost of providing the Services, if any. All materials and labor required to provide any Repairs or any other services or other work not specified in Section 2.1(a) hereof requested by the Company shall be billed to the Company, in addition to the Service Fee as adjusted, at a rate equal to the Provider's actual cost plus 10% service/overhead fee.   SECTION 3  COVENANTS OF THE COMPANY   As a condition to receiving the Services under this Agreement, the Company hereby agrees and covenants as follows:





  3.1. Access to the Fiber Ring Assets. The Company will provide full and free access to the equipment in which to perform service on a 24/7 basis.   3.2. Operation of the Fiber Ring Assets. The Company shall take any and all actions, and refrain from taking any action, within the control of the Company, to ensure that the Provider remains in compliance with, and does not breach or violate the terms of, a City Rights Agreement or any other agreement related to the Fiber Ring Assets to which the Provider is a party. This obligation shall include operating the Fiber Ring Assets in such a manner, and performing certain of the obligations of the operator of the Fiber Ring Assets, so as to remain in compliance with such agreements. The Company acknowledges that it has received and reviewed each of the City Rights Agreements set forth on Schedule 3.2 hereto. The obligations under this Section 3.2 shall survive termination of this Agreement for the life of any applicable City Rights Agreement or similar license. In any sale of a fiber ring, any transferee must agree to assume these obligations from Buyer.   3.3. Transfer of the Fiber Ring Assets. The Company shall not sell, transfer or otherwise attempt to convey or dispose of any part of the Fiber Ring Assets, other than sales and leases of capacity or of individual fiber strands in the ordinary and usual course of business unless the Provider consents to such transaction, which consent will not be withheld if, (a) the proposed transferee consents in writing to the assumption of all obligations of the Company under this Agreement, including those obligations to be undertaken under other agreements pursuant to Section 3.3, and (b) all governmental approvals (under City Rights Agreements or otherwise) have been obtained, with the Provider having the right (if it elects) to coordinate such efforts if it is the counterparty under such agreements requiring approval (with the Company to pay the reasonable costs of doing so).   SECTION 4  COVENANTS OF THE PROVIDER   As a condition to receiving the Service Fee and any other fees payable to the Provider under this Agreement, the Company hereby agrees and covenants as follows:   4.1. Commercially Reasonable Efforts. The Provider shall undertake commercially reasonable efforts to provide the Services and Repairs. The Provider shall provide the Services and Repairs in a professional and workmanlike manner.   4.2. Access to Information. The Provider shall make available any and all information held by it that is necessary and reasonable for the Company to fulfill its obligations under Section 3.3 of this Agreement.   4.3 Maintenance of Insurance. The Provider will obtain and maintain appropriate liability insurance in an amount of not less than $1,000,000 combined single limit for accidents or occurrences which cause bodily injury, death or property damage related to the performance of the Services. The insurance policy willname the Company as an additional insured. The Provider will provide the Company with a certificate of insurance issued to evidence such coverage. Such certificate will provide that there shall be no cancellation, non-renewal, or modification of such coverage without thirty days' prior written notice to the Company.





  4.4 Operation of the Fiber Ring Assets. The Provider shall take any and all actions, and refrain from taking any action, within the control of the Provider, to ensure that the Company remains in compliance with, and does not breach or violate the terms of a City Rights Agreement.   SECTION 5  MISCELLANEOUS   5.1.  Excused Non-Performance. The Provider shall not be liable nor deemed to be in default for any delay or failure in performance under this Agreement resulting, directly or indirectly, from causes beyond the reasonable control of the Provider, provided that the Provider shall refund to the Company a pro rata portion of the Service Fee for any period in excess of two (2) weeks during which the Provider fails to or is unable for any reason to provide the Services or Repairs called for under this Agreement. Service provided under this Agreement does not assure uninterrupted operation of equipment.   5.2. Limited Warranty. The Provider shall provide maintenance under this Agreement for the fixed rate without regard to the number of legitimate service requests by the Company.   5.3 Limitation of Liability. EXCEPT AS STATED ABOVE, THE PROVIDER'S OBLIGATIONS UNDER THIS AGREEMENT ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED. ALL IMPLIED WARRANTIES ARE LIMITED TO THE DURATION OF THIS AGREEMENT. A PARTY'S TOTAL LIABILITY TO THE OTHER PARTY IN CONNECTION WITH THIS AGREEMENT, FOR ANY AND ALL CAUSES OF ACTIONS AND CLAIMS, INCLUDING, WITHOUT LIMITATION, BREACH OF CONTRACT, BREACH OF WARRANTY, NEGLIGENCE, STRICT LIABILITY, MISREPRESENTATION AND OTHER TORTS, SHALL BE:   (a) FOR BODILY INJURY OR DEATH TO ANY PERSON PROXIMATELY CAUSED BY A PARTY'S NEGLIGENCE, THE AMOUNT OF DIRECT DAMAGES PROVEN;   (b) FOR LOSS OR DAMAGE TO REAL PROPERTY OR TANGIBLE PERSONAL PROPERTY PROXIMATELY CAUSED BY A PARTY'S NEGLIGENCE, THE AMOUNT OF DIRECT DAMAGES PROVEN;   (c) FOR ANY DAMAGES ARISING OUT OF THE WILLFUL OR INTENTIONAL MISCONDUCT OF A PARTY, THE AMOUNT OF DIRECT DAMAGES PROVEN;   (d) FOR ALL OTHER DAMAGES OTHER THAN THOSE SET FORTH ABOVE AND NOT EXCLUDED UNDER THIS AGREEMENT, EACH PARTY'S LIABILITY TO THE OTHER PARTY DURING ANY TWELVE (12) MONTH PERIOD SHALL BE LIMITED TO THE LESSOR OF (i) DIRECT DAMAGES PROVEN BY THE PARTY, OR (ii) THE AMOUNT PAID BY THE COMPANY TO THE PROVIDER UNDER THIS AGREEMENT FOR THE TWELVE (12) MONTH PERIOD PRIOR TO THE CLAIM.   The foregoing limitations do not apply to the Company's obligation to pay the Service Fees.





  THE PROVIDER SHALL NOT BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOSS OF REVENUES OR LOSS OF PROFIT, ARISING OUT OF THE PROVISION OF THE SERVICES OR REPAIRS, NOTWITHSTANDING ADVANCE NOTICE FROM THE COMPANY THAT THE POSSIBILITY OF SUCH DAMAGE OR LOSS EXISTS.   5.3. Notices. Any notice, request, demand or other communication required or permitted hereunder shall be deemed to have been given if delivered by facsimile transmission, upon receipt, if by hand delivery, upon receipt, if sent by nationally recognized overnight courier service, one day after deposit with such, or if sent by registered or certified mail, upon the sooner of the date on which receipt is acknowledged or the expiration of three days after deposit in United States post office facilities properly addressed with postage prepaid. All notices to a party will be sent to the addresses set forth below or to such other address or person as such party may designate by notice to each other party hereunder:   TO THE PROVIDER:



CityNet Telecommunications, Inc. 8405 Colesville Road 6th Floor Silver Spring, Maryland 20910 Attention: General Counsel Facsimile: 301-608-8121       TO THE COMPANY:



Universal Access Global Holdings Inc. 233 S. Wacker Drive, Suite 600 Chicago, IL 60606 Attention: General Counsel Facsimile: 312-660-1290   If notice is sent by facsimile transmission, in order to be effective, such notice must also be sent by one of the other means of delivery identified above. Any notice given hereunder may be given on behalf of any party by his counsel or other authorized representatives.   5.4. Amendments. Any term, covenant, agreement or condition of this Agreement may be amended only in a writing signed by the Company and the Provider.   5.5. Assignment; Successors or Assigns. This Agreement and the rights and obligations hereunder may be assigned by the Provider upon written notice to the Company. All rights and obligations under this Agreement shall be binding upon any and all successors or assigns.   5.6. Survival. All covenants, representations and warranties made herein by the Company shall survive and not be waived by the execution and delivery of this Agreement.





  5.7. Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. It shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart.   5.8. Headings. The headings of the sections and subsections hereof are provided for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.   5.9. Governing Law; Submission To Jurisdiction; Venue.   (a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED ACCORDING TO AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF DELAWARE, EXCLUDING ITS CONFLICTS OF LAWS PRINCIPLES TO THE EXTENT SUCH PRINCIPLES WOULD LEAD TO THE APPLICATION OF A SUBSTANTIVE LAW OTHER THAN THE LAW OF THE STATE OF DELAWARE.   (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF DELAWARE OR IN ANY UNITED STATES DISTRICT COURT SITTING WITHIN THE STATE OF DELAWARE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY AND THE PROVIDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY AND THE PROVIDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT. EACH OF THE COMPANY AND THE PROVIDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, THAT MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.   (c) EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.





  5.10. Severability. If any provision of this Agreement is determined to be illegal, invalid or unenforceable, such provision shall be fully severable and the remaining provisions shall remain in full force and effect and shall be construed without giving effect to the illegal, invalid or unenforceable provisions.   5.11. Entirety. This Agreement represents the entire agreement of the parties hereto, and supersedes all prior agreements and understandings, oral or written, if any, relating to the transactions contemplated herein.





  IN WITNESS WHEREOF, the parties hereto have caused this Maintenance Agreement to be executed by their duly elected officers duly authorized as of the date first above written.

UNIVERSAL ACCESS, INC.

By:



Name:

Title:

CITYNET TELECOMMUNICATIONS, INC.

By:



Name:

Title:





  SCHEDULE 3.2   City Rights Agreements   (1) Access and License Agreement dated December 8, 2000, between the Consolidated City of Indianapolis, Marion County, Indiana and the Department of Capital Asset Management (jointly as Licensor) and CityNet Telecommunications, Inc. as Licensee, as amended by the Amendment to the Access and License Agreement dated as of June 25, 2003, by and between Licensor, Licensee and Universal Access, Inc.   (2) License Agreement dated November 8, 2000, between the City of Albuquerque, New Mexico and CityNet Telecommunications, Inc.
Example Output: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

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