instruction:
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.
question:
Exhibit 10.B.01 EXECUTION COPY

VIDEO-ON-DEMAND CONTENT LICENSE AGREEMENT between Rogers Cable Communications Inc. (Rogers) and EuroMedia Holdings Corp. (Licensor) offering EurocinemaSM Video-on-Demand service made as of July 11 , 2006 (the Effective Date) (the Agreement)

  1. RIGHTS GRANTED   Licensor grants to Rogers the non-exclusive license and right to distribute and exhibit in Canada (the Territory) all entertainment programming to which Licensor owns or controls the VOD distribution and exhibition rights in the Territory (collectively, Licensed Programs) to residential subscribers of Rogers' digital cable television service on a Video-on-Demand (VOD) basis. For clarity, the VOD service that Rogers provides to such subscribers shall hereinafter be referred to as the ROD Service.     2. LICENSED PROGRAMS.     (a) Subject to Section 3, Licensor shall forthwith provide to Rogers a comprehensive list (including title, length of program, license period and availability date) of all currently available Licensed Programs. During the Term, Licensor shall use best efforts to add newly available Licensed Programs to such list, and may periodically delete Licensed Programs from such list; provided, however, that: (i) Licensor shall provide to Rogers at least ninety (90) days prior notice of the availability date of any Licensed Program added to such list during the Term; (ii) Licensor shall provide to Rogers at least sixty (60) days prior notice of the deletion of any Licensed Program from such list; and (iii) Licensor shall be responsible for any and all reasonable costs and/or losses incurred by Rogers as a result of any deletions from such list during the Term.     (b) Rogers reserves the right, in its sole discretion, to determine which Licensed Programs to distribute and exhibit on the ROD Service and, without limiting the generality of the foregoing, may decline to distribute or exhibit any Licensed Program that it determines, in its sole discretion, is unsuitable for distribution or exhibition on the ROD Service.     (c) Licensor shall use commercial reasonable efforts to provide Rogers with Licensed Programs with closed captioning.     3. AVAILABILITY DATE.     (a) Subject to Section 3(b), the availability date for any Licensed Program that is a feature-length motion picture or direct-to-video product shall be no later than ninety (90) days following the date on which such Licensed Program is made available for home video distribution within the U.S or the Territory.

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (b) In the event that Licensor grants to another VOD or Pay-Per-View (PPV) service provider in the U.S. or the Territory the right to distribute or exhibit any Licensed Program on an earlier availability date, then Licensor shall also grant to Rogers the right to distribute and exhibit such Licensed Program on such earlier availability date, on the terms provided herein.     (c) Licensor shall not authorize the distribution or exhibition of any Licensed Program by any other means, including, without limitation, television (other than PPV) and internet, for a period of ninety (90) consecutive days following such Licensed Program's VOD availability date.     4. LICENSE PERIOD.   During the Term, Rogers shall have the non-exclusive right to distribute and exhibit each Licensed Program on a VOD basis for a period of ninety (90) consecutive days, or such longer period as may be agreed to by Rogers and Licensor (the License Period).     5. VIEWING PERIOD.   The viewing period for each Licensed Program shall be at least twenty-four (24) consecutive hours, or such longer period as may be agreed to by Rogers and Licensor from time to time (the Viewing Period). Multiple viewings of the Licensed Program shall be permitted during the Viewing Period for no additional fee and all such viewings shall be considered a single exhibition of the Licensed Program for the purposes of calculating License Fees hereunder.     6. LICENSE FEES.     (a) Rogers shall pay to Licensor a fee (the License Fee), which shall be equal to fifty (50)% of Retail Revenues.   For the purposes of this Agreement, Retail Revenues means the retail revenues actually received by Rogers for each authorized exhibition of a Licensed Program on the ROD Service, less GST and applicable sales tax. For greater certainty, Retail Revenues shall not include any fees payable to Rogers for: (i) the purchase, rental or installation of a digital terminal; (ii) any basic or premium television services; or (iii) digital cable access.     (b) Notwithstanding Section 6(a) above,      (i) Prior to calculating License Fees, Rogers shall be entitled to deduct from Retail Revenues on a rolling monthly basis during the Term (Rogers Costs):     (A) the value of programming credits, rebates or other retail price discounts provided to ROD Service subscribers in conjunction with a public marketing or promotional initiative;   -2-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (B) the value of refunds provided by Rogers to ROD Service subscribers for technical or other errors during such month;     (C) the percentage equal to Rogers' average year-to-end bad debt exposure (including credit collection costs) for the then current calendar year in respect of all Rogers' cable television subscribers (expressed as a percentage)     (D) encoding costs incurred by Rogers, if applicable, pursuant to Section 8 (a) ; and     (E) closed captioning costs incurred by Rogers to comply with Applicable Law.     (ii) Rogers shall be entitled to deduct from License Fees on a rolling monthly basis during the Term:     (A) the marketing allowance pursuant to Section 12;     (B) the Production Fund Commitment pursuant to Section 13; and     (C) copyright royalty payments pursuant to Section 17.     (c) Payment of License Fees shall be made in Canadian funds in arrears within thirty (30) days following each calendar month during the Term in which Licensed Programs were exhibited hereunder and shall be accompanied by a statement of account showing the calculation of the License Fees.     (d) In the event that Retail Revenues in a particular month are not sufficient to fully reimburse Rogers for the Rogers Costs incurred in such month, Rogers shall be entitled to recover such amounts against Retail Revenues generated by other Licensed Programs in subsequent months.     (e) There shall be no minimum License Fee or retail viewing fee with respect to any Licensed Program. Additionally, Rogers shall not be required to pay any License Fees for VOD exhibitions of any Licensed Program occurring on or off premises that are made for the purposes of quality assurance or testing.     (f) Rogers shall be entitled to withhold from License Fees applicable withholding taxes and to remit same to the responsible taxing authorities, as required by Applicable Law.     7. TERM.     The term of this Agreement (the Initial Term) shall commence as of the Effective Date and, unless earlier terminated in accordance with this Agreement, shall terminate on June 30, 2010. At Rogers' option, this Agreement shall renew for a subsequent term of two (2) years on the terms and conditions herein (the Renewal Term). Notwithstanding the foregoing, if, at the expiry of this Agreement following the Initial Term or the Renewal Term (if any), as applicable, Licensor and Rogers have not executed a new agreement governing the VOD distribution and exhibition of Licensed Programs and Rogers (or its permitted assigns) continues to distribute and exhibit Licensed Programs on the ROD Service following such expiry, such continued distribution and exhibition shall be governed by the terms of this Agreement in effect at the time of expiry, except that each of Licensor and Rogers shall have the right, on sixty (60) days' prior written notice, to terminate this Agreement, as so extended. For greater certainty, all references to Term in this Agreement shall include the Initial Term, the Renewal Term (if any) and any period during which this Agreement continues following its expiry in accordance with this Section.   -3-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      8. ENCODING AND DELIVERY OF LICENSED PROGRAMS.     (a) Licensor shall, at its sole expense, encode each Licensed Program selected for distribution and exhibition by Rogers hereunder and shall deliver such fully encoded Licensed Program to Rogers on a DLT master tape, DVD-R disc or other master pre-recorded format acceptable to Rogers (each, a Master) at least thirty (30) days prior to the availability date for such Licensed Program. Such Masters shall at all times remain the sole property of Licensor and, within fifteen (15) days following the termination or expiration of this Agreement, Rogers shall either return to Licensor all such Masters then in its possession, or issue a certificate of erasure.     (b) To the extent any Master delivered by Licensor hereunder is determined by Rogers, in its sole discretion, acting reasonably, to be defective: (i) Licensor shall forthwith provide Rogers with a replacement Master; and (ii) if Rogers is unable to distribute and/or exhibit the Licensed Program on the availability date as a result of the defectiveness of any such Master, the License Fee payable in respect of such Licensed Program shall be reduced by 10% for the balance of the License Period.     9. TECHNICAL STANDARDS.   In carrying out its obligations hereunder, Licensor agrees to comply with Rogers' technical standards for materials, as specified by Rogers from time to time. Licensor hereby acknowledges receipt of a copy of or website link to CableLabs technical specifications.     10. MARKETING AND PROMOTION.     (a) Licensor shall provide, at its sole expense and on a timely basis, promotional materials and trailers for each Licensed Program selected for distribution and exhibition by Rogers hereunder, for use by Rogers to advertise and promote the availability of such Licensed Program on the ROD Service. Such promotional materials shall include, but not be limited to: (i) a promotional poster image or related film content in an electronic format; (ii) relevant metadata; (iii) trailer of Licensed Program in an encoded format; and (iv) title and related data.   -4-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (b) Licensor shall make available to Rogers, on a free trial basis and at no cost to Rogers, not less than ten (10) Licensed Programs at all times during the Term (each, a Promotional Program) for distribution and exhibition on the ROD Service to promote the Licensed Programs and the ROD Service. Licensor shall refresh the Promotional Programs at a frequency rate to be mutually agreed upon in writing by Rogers and Licensor.     (c) Licensor acknowledges and agrees that Rogers shall be entitled to insert a minimum of four (4) minutes of promotional materials per thirty (30) minutes of Promotional Programs. Rogers shall ensure that at least 75% of such promotional materials directly or indirectly promotes the Licensed Programs.     (d) Licensor shall use commercially reasonable efforts to promote the ROD Service through Licensor's consumer-facing advertising and promotional mediums within the Territory. Such mediums shall include, but not be limited to: (i) television; (ii) radio; (iii) print; (iv) Internet; and (v) event-based marketing. Licensor will deliver accurate, representative samples of all such advertising and promotions to Rogers at least five (5) business days in advance for Rogers' prior review and approval.     11. GUI/EPG.   Licensor, at its sole expense and on a timely basis, shall provide complete, accurate and informative listing and descriptive information in respect of each Licensed Program selected for distribution and exhibition by Rogers hereunder (including, without limitation, synopsis, theme, rating, closed captioning and such other information as may be appropriate or otherwise required by Rogers) to Rogers' graphic user interface (GUI) or electronic programming guide provider (EPG), as the case may be, as designated by Rogers from time to time.     12. MARKETING ALLOWANCE.   In consideration for various services and activities that Rogers performs for the benefit of Licensor during the Term, Licensor agrees to pay to Rogers an amount which shall be equal to ten (10)% of License Fees, calculated on a rolling basis during the Term and payable monthly.     13. PRODUCTION FUND.   For so long as Rogers is required by Applicable Law to contribute a percentage of its gross annual revenues from the ROD Service to an independently-administered Canadian program production fund, Licensor shall reimburse Rogers for 50% of the amount required to be remitted to such production fund by Rogers in respect of the exhibition of Licensed Programs (the Production Fund Commitment). The Production Fund Commitment shall be calculated monthly during the Term and shall be deducted as set out in Section 6 (b).   -5-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      14. REPRESENTATIONS AND WARRANTIES.     (a) Each of Rogers and Licensor represents and warrants to the other that it has the necessary power and authority to enter into this Agreement and to fully perform its obligations hereunder.     (b) Licensor represents, warrants and covenants to Rogers that:     (i) it is validly incorporated under the laws of The State of Florida, USA     (ii) it has obtained, and shall maintain throughout the Term, all necessary rights, clearances and authorizations to enter into this Agreement and fully perform its obligations hereunder in compliance with Applicable Law and, in particular, to permit Rogers to distribute and exhibit the Licensed Programs on a VOD basis in the Territory;     (iii) it has obtained, and shall maintain throughout the Term, all approvals and/or ratings from provincial authorities necessary to distribute and exhibit each Licensed Program, trailer and other promotional materials provided to Rogers hereunder;     (iv) it unilaterally owns or controls the VOD distribution and exhibition rights to all Licensed Programs within the Territory; and     (v) it has obtained, and shall maintain throughout the Term, all necessary rights to any equipment and/or technology used to provide the encoding services hereunder and its use of such services shall not violate the rights of any third party.     15. INDEMNIFICATION.     (a) Licensor shall indemnify Rogers and its affiliates from and against any and all claims, damages, liabilities, costs and expenses (including, without limitation, reasonable legal fees) arising out of or caused by:     (i) any breach by Licensor of any material term of this Agreement;     (ii) the content of any Licensed Program, trailer and/or other promotional materials provided by Licensor to Rogers hereunder (including, without limitation, any libelous, slanderous or obscene material, violations of copyright, trade- mark rights or other intellectual property rights, personality right, right of privacy or literary or dramatic right); and     (iii) any encoding or other services provided by Licensor hereunder.   -6-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (b) Rogers shall indemnify Licensor and its affiliates from and against any and all claims, damages, liabilities, costs and expenses (including, without limitation, reasonable legal fees) arising out of or caused by:     (i) any breach by Rogers of any material term of this Agreement; and     (ii) any claim by a Rogers customer, except a claim related to the content of any Licensed Program, trailer and/or other promotional materials provided by Licensor to Rogers hereunder.     (c) This Section shall survive the termination or expiration of this Agreement.     16. LIMITATION OF LIABILITY.   Except with respect to any claim or liability arising from an infringement of any third party intellectual property right, in no event shall either party be liable for any special, indirect, consequential, punitive or incidental damages of any kind. This Section shall survive the termination or expiration of this Agreement.     17. COPYRIGHT ROYALTY PAYMENTS.   For so long as Rogers is required by Applicable Law to pay copyright royalties relating to Licensed Programs hereunder, Licensor shall reimburse Rogers for 50% of any such royalties actually paid by Rogers, calculated on a rolling basis during the Term and payable monthly. This Section shall survive the termination or expiration of this Agreement.     18. ROGERS' TERMINATION RIGHTS.   Notwithstanding any other provision of this Agreement, Rogers may terminate this Agreement, at any time, upon sixty (60) days' prior written notice to Licensor.     19. MUTUAL TERMINATION RIGHTS.   Either Rogers or Licensor may, at its option and without prejudice to any other remedies available to it, immediately terminate this Agreement by giving written notice thereof to the other party for any one or more of the following causes:     (a) the other party defaults in the performance or observance of any of the material terms of this Agreement and such default continues for a period of thirty (30) days after written notice thereof;     (b) if, at any time, an order is made or an effective resolution is passed for the winding-up, liquidation or dissolution of the other party that is not immediately stayed by appeal;     (c) if, at any time, the other party consents to or makes a general assignment for the benefit of creditors, or makes a proposal under, or takes advantage of, any insolvency, restructuring or reorganization legislation, or is declared bankrupt, or if a liquidator, trustee in bankruptcy, custodian or receiver and manager or other officer with similar powers is appointed of the other party or of all or substantially all of the other party's property which is not immediately stayed by appeal; or   -7-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (d) Rogers, or any person to whom Rogers has assigned, sold or transferred this Agreement, ceases to offer the ROD Service.     20. EFFECT OF TERMINATION.   If either party terminates this Agreement prior to its expiration, Rogers shall be entitled to continue to distribute and exhibit all Licensed Programs then being distributed and exhibited on the ROD Service, in each case, for a period of sixty (60) days from the effective date of termination or the expiry of the relevant License Period, whichever is earlier, and, in such event, Rogers shall continue to be bound by its payment obligations set forth herein in respect of such Licensed Programs. This Section shall survive the termination of this Agreement for a period of sixty (60) days.     21. MOST FAVOURED NATIONS.   If Licensor enters, or has entered, into an agreement or series of agreements (including side letters, understandings or arrangements, whether oral or written, whether formal or informal, whether now or hereafter effective, or whether on a long-term basis or short-term basis) with a third party for the distribution and exhibition of Licensed Programs in the U.S. or the Territory on a VOD basis, or any other basis that permits the downloading of such Licensed Programs and the subsequent viewing of such Licensed Programs by a residential subscriber, on terms (including, without limitation, license fees, copyright royalty payments, encoding fees and obligations, and marketing support) that are more favourable than those contained in this Agreement, then Rogers has the right to incorporate, or substitute, as the case may be, such term or terms into this Agreement, effective as of the date on which such term or terms were accorded to the third party and for the balance of the period such term or terms are applicable to such third party. Licensor shall provide to Rogers, no later than February 28 in each year, a sworn statement of a senior officer of Licensor, or a certificate of the auditors of Licensor, confirming that, during the immediately preceding calendar year, Licensor did not enter into such an agreement or series of agreements or, if it did enter into such agreement(s), confirming the effective date thereof and identifying the terms contained therein that are more favourable than those contained in this Agreement. During the Term, and for a period of twelve (12) months thereafter, Rogers (and its representatives) shall have the right, upon reasonable prior written notice to Licensor, and during regular business hours, to inspect and/or audit Licensor's books and records to confirm compliance with Licensor's obligations under this Section. This Section shall survive the expiry or other termination of this Agreement for a period of twelve (12) months.   -8-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      22. CONFIDENTIALITY AND OWNERSHIP.     (a) Rogers and Licensor each agree to maintain the provisions of this Agreement in the strictest confidence, except that the parties may disclose such terms to their affiliates, their respective professional advisors and, in such event, to the extent necessary to: (i) enforce their respective rights hereunder; (ii) comply with the valid order of an administrative agency or court of competent jurisdiction, or with any Applicable Law; and (iii) comply with contractual obligations owed to third parties; provided, however, that, in the case of any disclosure pursuant to items (ii) or (iii) above, (A) the disclosing party shall notify the other party as soon as practicable (and if possible prior to disclosure) and (B) any information so disclosed shall be redacted to the greatest extent possible.     (b) Each party agrees to use the other party's confidential information solely for the purpose of fulfilling its obligations under this Agreement, to hold the other party's confidential information in confidence and to protect the confidentiality of such confidential information using the same degree of care as it uses to protect its own confidential information of a like nature, which shall, in any event, be no less than a degree of care consistent with industry standards. Notwithstanding the foregoing, the receiving party may disclose confidential information to the extent required to comply with the valid order of an administrative agency or court of competent jurisdiction, or with any Applicable Law (provided that the receiving party shall notify the other party as soon as practicable (and if possible prior to disclosure) and any information so disclosed shall be redacted to the greatest extent possible).     (c) Rogers shall own all data and information relating to Rogers' subscribers, including, without limitation, all personal and demographic information, all information relating to an individual subscriber's use of the ROD Service and all aggregate information relating to the use by Rogers' subscribers of the ROD Service (collectively, Rogers Subscriber Information). Licensor acknowledges that Rogers Subscriber Information constitutes valuable assets of Rogers and agrees to hold all Rogers Subscriber Information strictly confidential in accordance with the provisions set forth in Section 22(b) above.     (d) This Section shall survive the termination or expiration of this Agreement.     23. GOVERNING LAW.   This Agreement shall be governed by laws of the Province of Ontario and the federal laws of Canada applicable therein. The parties hereby attorn to the non-exclusive jurisdiction of the courts of the Province of Ontario. This Section shall survive the termination or expiration of this Agreement.     24. ASSIGNMENT.   This Agreement may not be assigned, sold or transferred without the prior written consent of the other party. Notwithstanding the foregoing, Rogers may, without consent, assign its rights and obligations under this Agreement in whole or in part to: (i) a person that directly or indirectly controls, is controlled by or is under common control with Rogers; or (ii) a purchaser of all or substantially all of the assets used in connection with the ROD Service. A change of control of Rogers shall not be considered an assignment of this Agreement. Any purported assignment, sale, or transfer in contravention of this Section shall be null and void.   -9-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      25. FORCE MAJEURE.   Neither party shall be liable to the other for temporary failure to perform hereunder, if such failure is caused by reason of an Act of God, tempest, satellite circuit failure, labour dispute, strike, temporary or permanent breakdown of facilities, fire, flood, Applicable Law, civil disturbance, or any other cause beyond the parties' respective control. In the event of any force majeure which continues for a period of thirty (30) days or more, the party not immediately affected by such force majeure event may, upon notice to the other party, terminate this Agreement.     26. NOTICES.   Any notice, request, demand, consent or other communication (collectively a Notice) provided or permitted hereunder shall be in writing and given by personal delivery (against receipt), or sent by registered mail (against receipt) postage prepaid, or transmitted by facsimile (provided that a hard copy is immediately sent by registered mail), addressed to the other party for which it is intended at its address below:   To Rogers:   Rogers Cable Communications Inc. 333 Bloor Street East Toronto, Ontario M4W 1G9 Attention: Vice-President, General Manager, Television FAX: (416) 935-4600   with a copy to:   Rogers Communications Inc. 333 Bloor Street East Toronto, Ontario M4W 1G9 Attention: Vice-President, General Counsel FAX: (416) 935-3548   To Licensor:   Sebastien Perioche   Eurocinema   1395 Brickell Ave.,   Suite 800,   Miami, FL 33131, 305-529-6220   FAX: 305-529-6201

-10-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





    Any Notice given pursuant to this Agreement shall make specific reference to this Agreement. Any Notice so given shall be deemed to have been received on the date on which it was delivered in person, or transmitted, if delivered or transmitted on a day, other than a Saturday, on which the Toronto-Dominion Bank in Toronto is open for business (a Business Day) during normal business hours of the recipient and, if not so delivered or transmitted, on the next Business Day or, if sent by registered mail, on the fifth (5t h) Business Day thereafter; provided, however, that either party may change its address and/or facsimile number for purposes of receipt of any such communication by giving ten (10) days prior written notice of such change to the other party in the manner prescribed above.     27. APPLICABLE LAW.   This Agreement is subject to all laws, regulations, license conditions and decisions of the Canadian Radio-television and Telecommunications Commission (CRTC) municipal, provincial and federal governments or other authorities which are applicable to Rogers and/or Licensor, and which are now in force or hereafter adopted (Applicable Law). In the event that any such law, regulation or decision comes into force during the Term concerning the subject matter of this Agreement, such that it prevents or diminishes either party's ability to perform under this Agreement, the parties agree to enter into good faith negotiations to amend this Agreement, where required, in order to remedy such diminution of or inability to perform.     28. SET-OFF.   Rogers shall be entitled to set off any sums owing to Licensor against any sums owing by Licensor to Rogers hereunder.     29. LEGAL EFFECT.     (a) Nothing herein contained shall be deemed to create and the parties do not intend to create any relationships of partner, agent or joint venture as between Rogers and Licensor.     (b) Subject to Section 29(d) below, this Agreement constitutes a binding agreement with respect to the matters set out herein and supersedes all prior agreements, negotiations, representations and proposals, whether written or oral. There are no conditions, covenants, representations or warranties, express or implied, statutory or otherwise relating to the subject matter hereof except as herein expressly provided.   -11-

Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007





      (c) No amendment, waiver or modification of any provision of this Agreement shall be binding on a party unless consented to in writing by such party. No waiver of any provision of this Agreement shall constitute a waiver of any other provision, nor shall any waiver constitute a continuing waiver unless otherwise expressly provided in writing.     (d) This Agreement shall not become a valid and binding contract unless and until each party has duly executed two (2) copies of this Agreement and one fully executed copy of the Agreement has been delivered to, or received by, each party. For greater certainty, there shall be no agreement between the parties with respect to the subject matter of this Agreement, whether written or oral, express, implied or otherwise, until the parties have complied with the execution and delivery requirements set forth in this Section 29(d), notwithstanding any performance between the parties concerning the subject matter of this document.   To indicate your agreement to the foregoing, please sign and date the Agreement and return it by fax, with an original by courier, to Rogers Cable Communications Inc., 333 Bloor Street East, Toronto, Ontario, M4W 1G9, Attention: Vice-President, Strategy & Development.         ROGERS CABLE COMMUNICATIONS INC.

      Per:

Name: Edward Rogers Title: President and CEO

Per:

Name: David Purdy Title: Vice-President, General Manager, Television     ACCEPTED and AGREED TO this ______ day of ____________, 2006.           Per:

Name: Sebastien Perioche Title: Chairman/CEO



-12-



Source: EUROMEDIA HOLDINGS CORP, 10SB12G, 2/15/2007
answer:
Highlight the parts (if any) of this contract related to Cap On Liability that should be reviewed by a lawyer. Details: Does the contract include a cap on liability upon the breach of a party’s obligation? This includes time limitation for the counterparty to bring claims or maximum amount for recovery.


question:
Exhibit 10.2 PORTIONS OF THIS EXHIBIT MARKED BY [**] HAVE BEEN OMITTED PURSUANT TO RULE 601(B)(10) OF REGULATION S-K. THE OMITTED INFORMATION IS (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. EXECUTION VERSION STRATEGIC ALLIANCE AGREEMENT STRATEGIC ALLIANCE AGREEMENT, dated as of December 20, 2019 (as amended, supplemented or otherwise modified from time to time, this Agreement), by and among Farids & Co. LLC, a Delaware limited liability company (Farids), Edible Arrangements, LLC, a Delaware limited liability company (EA), and Rocky Mountain Chocolate Factory, Inc., a Delaware corporation (the Company). W I T N E S S E T H: WHEREAS, the Company is an international franchisor, confectionery manufacturer and retail operator; WHEREAS, Farids is a holding company and, together with TF (as defined below), indirectly controls EA; WHEREAS, EA is a US-based franchisor that specializes in fresh fruit arrangements and specialty fruit gift items; WHEREAS, the Company desires to issue and sell, and Farids desires to purchase, 126,839 shares (the Purchased Shares) of the Company's common stock, $0.001 par value per share (the Common Stock), on the terms set forth herein; WHEREAS, substantially concurrently with the execution and delivery of this Agreement, the Company and EA shall execute and deliver the Warrant (as defined below); WHEREAS, substantially concurrently with the execution and delivery of this Agreement, the Company and EA shall execute and deliver the Exclusive Supplier Operating Agreement (as defined below); and WHEREAS, in connection with the foregoing, the Company, Farids and EA agree and acknowledge that the cooperation between the Company and EA is an important component to achieve their respective strategic objectives, and they desire to continue and further enhance the strategic cooperation alliance between them as contemplated under this Agreement. NOW THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.1 Defined Terms. (a) 144 Sale means (i) a Transfer of Shares (including in any broker assisted cashless exercise) pursuant to Rule 144 under the Securities Act and (ii) for purposes of Article VII only, any Transfer of Shares pursuant to a Resale Shelf Registration Statement.





(b) Affiliate of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, control (including, with correlative meanings, the terms controlling, controlled by and under common control with), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. (c) Amendment means the Amendment, dated the date hereof, to the Rights Agreement by and between the Company and Computershare Trust Company, N.A., as Rights Agent, attached as Exhibit E hereto. (d) Board of Directors means the Board of Directors of the Company. (e) Bylaws means the Second Amended and Restated Bylaws of the Company, as in effect as of the date hereof. (f) Certificate of Incorporation means the Company's Amended and Restated Certificate of Incorporation, as amended, as in effect as of the date hereof. (g) Change in Control means the occurrence of any of the following: (i) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Company to any Person other than a Permitted Holder; or (ii) at any time, the Company becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), other than the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of 50% or more of the total voting power of the Voting Stock of the Company. (h) Eligible Registration Statement means any registration statement (other than (i) a registration statement on Form S-4 or Form S-8 or any similar or successor form or (ii) with respect to any corporate reorganization or transaction under Rule 145 of the Securities Act or other business combination or acquisition transaction, any registration statement related to the issuance or resale of securities issued in such a transaction) filed by the Company under the Securities Act in connection with any primary or secondary offering of Common Stock for the account of the Company and/or any shareholder of the Company, whether or not through the exercise of any registration rights. (i) Exchange Act means the Securities Exchange Act of 1934, as amended. 2





(j) Exclusive Supplier Operating Agreement means the Exclusive Supplier Operating Agreement, dated as of the date hereof, by and between EA and the Company, attached as Exhibit B hereto. (k) Family Member means, with respect to any natural person, (i) any child, stepchild, grandchild or more remote issue, parent, stepparent, grandparent, spouse, domestic partner, sibling, child of sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, cousin and adoptive relationships (each, a family member) or estate of such family member or (ii) any foundation, trust, family limited partnership, family limited liability company or other entity created and used for estate planning purposes, so long as any such foundation, trust, family limited partnership, family limited liability company or other entity is controlled by, for the benefit of, or owned by such natural person or one or more persons described in clause (i) (such entities referred to in this clause (ii), the Permitted Estate Vehicles). (l) Farids Group means Farids, EA and each and every Farids Transferee. Unless the Company is otherwise notified in writing by Farids or EA, TF shall at all times serve as the designated representative to act on behalf of the Farids Group for purposes of this Agreement and shall have the sole power and authority to bind the Farids Group with respect to all provisions of this Agreement; provided, however, that if TF ceases to serve as the designated representative of the Farids Group, then TF (or his designated legal representative in the case of his death or permanent disability) shall have the power to designate a new designated representative of the Farids Group, which designee (and any successor thereafter designated and appointed) shall have the sole power and authority to bind the Farids Group with respect to all provisions of this Agreement. The Company shall be entitled to rely on all actions taken by TF or such designee on behalf of the Farids Group. (m) Farids Transferee means each and every direct and indirect transferee of Farids (including transferees of Shares from any member of the Farids Group so long as such Shares were originally held by the Farids Group) pursuant to Transfer set forth in clause (i) or (ii) of the definition of Permitted Transfer. (n) FINRA means the Financial Industry Regulatory Authority, Inc. (o) GAAP means U.S. generally accepted accounting principles. (p) Holder means any Person owning of record Common Stock or any security convertible into or exercisable or exchangeable for, with or without consideration, any Common Stock. (q) Indemnification Agreement means the Indemnification Agreement, dated as of the date hereof, by and between the Company and TF, attached as Exhibit D hereto. (r) Investors means (i) Farids, (ii) EA and (iii) TF and his Family Members. (s) Law means any domestic or foreign, U.S. Federal, state, municipality or local law, statute, ordinance, code, rule, or regulation or common law. 3





(t) Lien means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, including any agreement to give any of the foregoing. (u) Lock-Up Securities means (i) any Common Stock or Preferred Stock of the Company, (ii) any security convertible into or exercisable or exchangeable for, with or without consideration, any Common Stock or Preferred Stock of the Company (including any option to purchase such a security), (iii) any security carrying any option, warrant or right to subscribe to or purchase any Common Stock or Preferred Stock of the Company or other security referred to in clause (ii), or (iv) any such option, warrant or right. (v) Nasdaq means The Nasdaq Stock Market LLC. (w) Order means any decree, order, judgment, writ, award, injunction, rule or consent of or by a Governmental Entity. (x) Permitted Holders means each of (i) the Investors and their respective Affiliates and members of management of the Company and (ii) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing are members; provided that in the case of such group, without giving effect to such group, Persons specified in clause (i) must collectively beneficially own a majority of the total voting power of the Voting Stock of the Company beneficially owned by such group. (y) Permitted Transfer means (i) any Transfer to one or more entities that are, directly or indirectly, wholly owned by Farids or any Family Member of TF, (ii) any Transfer to one or more entities that are members of the Farids Group and (iii) Transfer made following a Change in Control of Farids or EA or made pursuant to a Change in Control that constitutes a sale of the Company as a whole; provided, with respect to each of clause (i)-(iii), so long as the transferee (other than a transferee that already is party to this Agreement) agrees to be subject to the terms of this Agreement (subject to any limitation on the assignment of rights by such Person to the transferee in connection with such Transfer) by executing and delivering a joinder agreement, substantially in the form of Exhibit A hereto. (z) Person means an individual, partnership, corporation, limited liability company, unincorporated organization, trust, joint venture, government agency, or other entity. (aa) Prospectus means the prospectus included in the Eligible Registration Statement, including any form of prospectus or any preliminary prospectus, as amended or supplemented by any prospectus supplement and by all other amendments or supplements to such prospectus, including all post-effective amendments and all material, if any, incorporated by reference or deemed to be incorporated by reference into such prospectus. (bb) Registrable Securities means all Purchased Shares and Warrant Shares and any securities into which Common Stock may be converted or exchanged pursuant to any merger, consolidation, sale of all or any part of the Company's assets, corporate conversion or other extraordinary transaction of the Company held by the Farids Group, other than any Common Stock or securities into which Common Stock may be converted or exchanged that (i) have been sold by the Farids Group to the public either pursuant to a registration statement or Rule 144 or another exemption from the registration requirements of the Securities Act, (ii) except in connection with a Demand Request by the Farids Group for a registration pursuant to a Resale Shelf Registration Statement, in the hands of the Farids Group is eligible to be resold pursuant to Rule 144 without any volume limitation or (iii) shall have ceased to be outstanding; provided, that when determining the amount of Registrable Securities, only the Purchased Shares, any Vested Warrant Shares and the remaining Warrant Shares eligible for vesting into Vested Warrant Shares shall be included in such calculation. 4





(cc) Registration Expenses means all expenses incurred by the Company in complying with Article VI hereof, including, without limitation, (i) all SEC and other registration and filing fees (including, without limitation, fees and expenses with respect to (A) filings required to be made with FINRA and (B) securities or blue sky laws, including, without limitation, any fees and disbursements of counsel for the underwriters in connection with any filing and application made to or with (and clearance by) FINRA and any blue sky qualifications of the Registrable Securities pursuant to Section 6.6(d)), (ii) preparation, printing, messenger and delivery expenses, (iii) fees and disbursements of counsel for the Company, (iv) fees and disbursements of independent certified public accountants and any other persons, including special experts retained by the Company, (v) expenses related to any special audits incident to or required by any such registration, in each case, whether or not any Eligible Registration Statement is filed or becomes effective, (vi) all fees and expenses related to the listing of the Registrable Securities on any securities exchange, (vii) all internal expenses of the Company, including the compensation of officers and employees of the Company and the fees and expenses in connection with any annual audit and (viii) the fees and expenses of one counsel for the Farids Group in connection with the review of any registration statement, not to exceed $10,000 for each registration. For the avoidance of doubt, any stamp, transfer or similar taxes or duties payable by the Farids Group in connection with any registration, sale or distribution of Registrable Securities shall be borne by the Farids Group and not by the Company. (dd) Resale Shelf Registration Statement means a shelf registration statement on Form S-3 pursuant to Rule 415 under the Securities Act; provided that any sales of securities thereunder will not (i) require a prospectus supplement, (ii) require any additional cooperation from the Company (except as set forth in Section 6.4(b)) or (iii) be made pursuant to an underwritten offering. (ee) Rights Agreement means the Rights Agreement dated March 1, 2015 between the Company and Computershare Trust Company, N.A., as Rights Agent. (ff) SEC or Commission means the Securities and Exchange Commission. (gg) Securities Act means the Securities Act of 1933, as amended. (hh) Shares means, collectively, the Purchased Shares or shares of Common Stock issued or issuable upon exercise of the Warrants. (ii) Significant Block means five percent (5%) or more of the Company's issued and outstanding Common Stock. 5





(jj) Subsidiary means, any Person of which at least a majority of the securities or ownership interests having by their terms ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions is directly or indirectly owned or controlled by the Company or by one or more of its Subsidiaries. (kk) TF means Tariq Farid, an individual. (ll) Threshold Block means one percent (1%) or more of the Company's issued and outstanding Common Stock. (mm) Transaction Documents means, collectively, this Agreement, the Exclusive Supplier Operating Agreement, the Warrant, the Indemnification Agreement and the Amendment. (nn) Transfer means any sale, assignment, encumbrance, hypothecation, pledge, conveyance in trust, gift, transfer by request, devise or descent, entry into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership (whether to be settled by delivery of the Purchased Shares, in cash or otherwise) or other transfer or disposition of any kind, including, but not limited to, transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors whether voluntary or by operation of law, directly or indirectly, of any Purchased Shares. (oo) Vested Warrant Shares means the shares of Common Stock into which the Warrant shall vest and for which the Warrant shall become exercisable. (pp) Voting Stock of the Company as of any date means the shares of capital stock of the Company that is at the time entitled to vote in the election of the Board of Directors of the Company. (qq) Warrant means the common stock purchase warrant, dated the date hereof, issued to the EA, providing for the purchase at a purchase price per share of $8.76 of up to 960,677 Warrant Shares, attached as Exhibit C hereto. (rr) Warrant Shares means the shares of Common Stock issuable upon exercise of the Warrant. ARTICLE II ISSUANCE OF THE PURCHASED SHARES Section 2.1 Share Purchase. Upon the terms and subject to the conditions set forth in this Agreement, Farids hereby agrees to purchase, and the Company hereby agrees to issue and sell to Farids, at the Closing (as defined below), the Purchased Shares (the Share Purchase), in consideration of the payment by Farids to the Company of $999,998.68 (the Purchase Price) and Farids assistance in developing the strategic alliance contemplated hereby. The Purchase Price shall be paid by Farids by the Company by wire transfer of immediately available funds, to one or more bank accounts designated in writing by the Company, on the Closing Date (as defined below). 6





Section 2.2 Closing. The closing of the Share Purchase (the Closing) shall take place at the offices of Perkins Coie LLP, 1900 Sixteenth Street Suite 1400, Denver, Colorado 80202, at 11:00 a.m. Mountain Time or before 90 days after the date hereof (such , the Closing Date). Section 2.3 Transactions to be Effected At or Prior to the Closing. At or prior to the Closing, the transactions below shall take place (except (i) to the extent such day is not a business day, (ii) the transactions set forth in clauses (a) through (e) below shall take place on or prior to the date hereof and (iii) the transactions set forth in clauses (f) through (h) shall take place as promptly as practicable on or after the date hereof, but in no event later than the Closing Date): (a) The Board of Directors shall have taken all necessary action related to the nomination of TF for election to the Board of Directors at the Company's annual meeting of stockholders to be held on January 9, 2020 (the Annual Meeting), provided that the mailing and filing of proxy materials reflecting the nomination of TF to the Board of Directors shall be completed no later than two (2) business days following the date hereof. (b) The Company and Farids shall execute and deliver this Agreement. (c) The Company and EA shall execute and deliver the Exclusive Supplier Operating Agreement and, in consideration of EA entering into the Exclusive Supplier Operating Agreement and the performance of EA's obligations therein, the Company shall issue the Warrant to EA. Each of the Exclusive Supplier Operating Agreement and the Warrant is effective as of the date hereof in accordance with the terms of such document. (d) The Company and TF shall execute and deliver the Indemnification Agreement. (e) The Company and Computershare Trust Company, N.A. shall execute and deliver the Amendment. (f) The Company shall receive the approval of Nasdaq with respect to the supplemental listing of the Purchased Shares and the reservation for issuance on the Nasdaq Global Market of the Warrant Shares. (g) The Company shall issue to Farids the Purchased Shares in electronic book-entry form. (h) The Company shall deliver to Farids the irrevocable letter of instructions addressed to the Company's transfer agent, relating to the issuance of the Purchased Shares. ARTICLE III REPRESENTATIONS AND WARRANTIES Section 3.1 Representations and Warranties of the Company. The Company represents and warrants to each of Farids and EA as of the date hereof and as of the Closing Date that: 7





(a) Existence and Power. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has all power and authority, corporate and otherwise, and all governmental licenses, franchises, permits, authorizations, consents and approvals required to own and operate its properties and assets and to carry on the business as presently conducted and as proposed to be conducted, except as would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, results of operations or financial condition of the Company and its Subsidiaries, taken as a whole (a Company Material Adverse Effect). (b) Capitalization. The authorized capital stock of the Company consists of (i) 46,000,000 shares of Common Stock and (ii) 250,000,000 shares of preferred stock, $0.001 par value per share (the Preferred Stock), of which 50,000 shares are designated as Series A Junior Participating Preferred Stock. As of December 19, 2019, there were 6,004,229 shares of Common Stock issued and outstanding and no shares of Preferred Stock outstanding. As of December 19, 2019, no shares of Common Stock or Preferred Stock were reserved for issuance, except for an aggregate of 258,888 shares of Common Stock reserved for issuance upon the exercise of outstanding stock options and the settlement of restricted stock units issued under the Company's equity incentive plans and stock incentive plans. All of the issued and outstanding shares of Common Stock have been duly authorized and validly issued and are fully paid, nonassessable and free of preemptive rights. (c) Authority; Approvals. The Company has full corporate power and authority to execute and deliver each of the Transaction Documents to which it is a party and to consummate the transactions contemplated thereby. The execution and delivery of each of the Transaction Documents to which it is a party and the consummation by the Company of the transactions contemplated thereby, including, without limitation, the issuance of the Purchased Shares, the Warrant and the underlying Warrant Shares, have been duly and validly approved by all necessary corporate action of the Company, and no other corporate and no shareholder proceedings on the part of the Company are necessary to approve such Transaction Documents or to consummate the transactions contemplated thereby. The Board of Directors has taken all actions so that the restrictions contained in Section 203 of the Delaware General Corporation Law, as amended (the DGCL), applicable to a business combination (as defined in Section 203 of the DGCL) do not and will not apply to the execution, delivery or performance of any Transaction Document and the transactions contemplated hereby and thereby. Each of the Transaction Documents to which it is a party has been duly and validly executed and delivered by the Company and (assuming due execution and delivery by Farids and EA, as applicable) constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as enforcement may be limited by general principles of equity whether applied in a court of law or a court of equity and by bankruptcy, insolvency and similar laws affecting creditors' rights and remedies generally (collectively, the Enforceability Exceptions). (d) Non-Contravention. The execution, delivery and performance of the Transaction Documents to which it is a party, and the consummation by the Company of the transactions contemplated hereby and thereby, does not and will not (i) contravene or conflict with the Certificate of Incorporation or the Bylaws, (ii) contravene or conflict with or constitute a violation of any provision of any Law or Order binding upon the Company, (iii) constitute a default under or breach of (with or without the giving of notice or the passage of time or both) or violate or give rise to any right of termination, cancellation or acceleration of any material contract or other instrument or obligations binding upon the Company or by which any shares of the Common Stock or the Preferred Stock or any of the Company's assets is or may be bound or (iv) result in the creation or imposition of any Lien on any of the shares of Common Stock or Preferred Stock or any of the Company's assets. 8





(e) Consents and Approvals. Assuming the accuracy of the representations and warranties of each of Farids and EA as set forth in this Agreement and EA as set forth in the Exclusive Supplier Operating Agreement, as of the Closing Date, no consents or approvals of, or filings or registrations with, any federal, state or local court, governmental, legislative, judicial, administrative or regulatory authority, agency, commission, body or other governmental entity or self-regulatory organization (each, a Governmental Entity) or of or with any other third party by or on behalf of the Company or any of its Subsidiaries are necessary for the execution and delivery by the Company of any Transaction Document to which it is a party and the consummation by the Company of the transactions contemplated thereby, except for (A) those already obtained or made, (B) the filing of any Eligible Registration Statement with the Commission pursuant to Article VI, (C) the supplemental listing application to Nasdaq with respect to the supplemental listing of the Purchased Shares and the reservation for issuance on the Nasdaq Global Market of the Warrant Shares and (D) any securities or blue sky filings of any state. The transactions contemplated by the Transaction Documents do not require the consent or approval by the holders of a majority of the outstanding shares of Common Stock pursuant to Nasdaq Listing Rule 5635. (f) Valid Issuance of Purchased Shares. As of the Purchase Date, the Purchased Shares shall be, and the Warrant Shares, when issued and delivered to EA in accordance with the terms of the Warrant will be, validly issued, fully paid, non-assessable and free of preemptive rights and will be delivered free and clear of all Liens. Except for the transactions contemplated in the Transaction Documents, the issuance and delivery of the Purchased Shares and the Warrant does and will not cause the vesting of any securities of the Company to accelerate, or trigger or create in any Person the right to acquire, purchase, exercise, exchange or convert any securities of the Company into Common Stock. (g) SEC Filings; Financial Statements. All forms, reports, schedules, statements and documents required to be filed with the SEC by the Company (including all exhibits included therein and financial statements, notes and schedules thereto and documents incorporated by reference therein, the SEC Reports) during the twelve (12) months prior to the date hereof were prepared in accordance and complied as of their respective filing dates, in all material respects, with the requirements of the Securities Act and Exchange Act and the rules promulgated thereunder and did not at the time they were filed (or if amended or superseded by a later filing prior to the date hereof, then on the date of such later filing) contain any untrue statement of material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Except as otherwise disclosed in an SEC Report, each of the audited and unaudited consolidated financial statements (including, in each case, any related notes and schedules thereto) contained in the SEC Reports (or if amended or superseded by a later filing prior to the date hereof, then on the date of such later filing) (i) complied in all material respects with applicable accounting requirements and the published regulations of the SEC with respect thereto, (ii) were prepared in accordance with GAAP (except, in the case of unaudited financial statements, to the extent otherwise permitted by the rules and regulations of the SEC) applied on a consistent basis throughout the periods involved (except as may be indicated therein or as described in the notes thereto) and (iii) fairly present in all material respects the financial position of the Company as of the respective dates thereof and the consolidated results of operations and cash flows for the periods indicated (subject in the case of unaudited financial statements to normal year-end adjustments and to any other adjustments described therein, including the notes thereto). Other that certain non-recurring expenses, no material adverse changes have occurred in the financial condition or business of the Company since the date of the most recent financial statement included in the SEC reports. 9





(h) Application to Takeover Protections. The Company and its Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, fair price, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation, the Bylaws or the laws of its jurisdiction of incorporation that is or could become applicable to the Farids Group or any Person in the Farids Group as a result of Farids, EA and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation as a result of the Company's issuance of the Purchased Shares, the Warrants and the underlying Warrant Shares and the ownership of such securities by the Farids Group or any Person in the Farids Group. Section 3.2 Representations and Warranties of Farids and EA. Each of Farids and EA, severally with respect to itself and not jointly, hereby represents and warrants to the Company, as of the date hereof and as of the Closing Date that: (a) Existence and Power. Farids is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. Farids has all power and authority, limited liability company and otherwise, and all governmental licenses, franchises, permits, authorizations, consents and approvals required to own and operate its properties and assets and to carry on the business as presently conducted and as proposed to be conducted, except as would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, results of operations or financial condition of Farids and its subsidiaries, taken as a whole. EA is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. EA has all power and authority, limited liability company and otherwise, and all governmental licenses, franchises, permits, authorizations, consents and approvals required to own and operate its properties and assets and to carry on the business as presently conducted and as proposed to be conducted, except as would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, results of operations or financial condition of EA and its subsidiaries, taken as a whole. (b) Authorization; Approvals. Each of Farids and EA has full power and authority to execute and deliver each of the Transaction Documents to which it is party, as applicable, and to consummate the transactions contemplated thereby and the consummation by Farids and EA of the transactions contemplated thereby have been duly and validly approved by all necessary limited liability company action of each of Farids and EA, and no other limited liability company and no member proceedings on the part of either Farids or EA are necessary to approve such Transaction Documents or to consummate the transactions contemplated thereby. Each of the Transaction Documents that has been executed and delivered by Farids or EA (assuming due authorization, execution and delivery by the Company), as applicable, constitutes a valid and binding obligation of Farids or EA, as applicable, enforceable against Farids or EA, as applicable, in accordance with its terms, subject to Enforceability Exceptions. 10





(c) Non-Contravention. The execution, delivery and performance of the Transaction Documents and the consummation by Farids and EA of the transactions contemplated hereby and thereby, does not and will not (i) contravene or conflict with (A) Farids' certificate of formation or operating agreement or (B) EA's certificate of formation or operating agreement, (ii) contravene or conflict with or constitute a violation of any provision of any Law or Order binding upon EA or Farids, (iii) constitute a default under or breach of (with or without the giving of notice or the passage of time or both) or violate or give rise to any right of termination, cancellation or acceleration of any material contract or other instrument or obligations binding upon Farids or by which any shares of the capital stock of Farids or EA or EA or any of Farids' or EA's assets is or may be bound or (iv) result in the creation or imposition of any Lien on any of the shares of capital stock of Farids or EA any of Farids' or EA's assets. (d) Consents and Approvals. Assuming the accuracy of the representations and warranties of the Company as set forth in this Agreement and the Exclusive Supplier Operating Agreement, as of the Closing Date, no consents or approvals of, or filings or registrations with, any Governmental Entity or of or with any other third party by or on behalf of Farids or EA is necessary for the execution and delivery by Farids and EA, as applicable, of the Transaction Documents and the consummation by Farids and EA, as applicable, of the transactions contemplated thereby. (e) Ownership of the Company; Control of EA. Except for the transactions contemplated in the Transaction Documents, none of Farids or any of its Affiliates holds or has any rights to acquire, whether directly or indirectly, any Common Stock or any other voting or equity securities of the Company, or any securities convertible into, exchangeable for or exercisable for Common Stock or any other voting or equity securities of the Company. EA is controlled by Farids. (f) Accredited Investor; Experience. Farids is an accredited investor (as defined in Rule 501 under the Securities Act) and is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. (g) Acquisition for Own Account. Farids is acquiring the Purchased Shares for its own account for investment purposes, and not with a view to, or for the sale in connection with, any distribution thereof in violation of the Securities Act, and the rules and regulations of the SEC promulgated thereunder, or that would require the issuance of the Purchased Shares pursuant to this Agreement to be registered under the Securities Act. (h) No Reliance. Farids has relied upon the representations and warranties set forth herein and its own investigations and diligence, including a review of the Company's annual, quarterly and current reports and other documents filed with or furnished to the SEC, and not upon any other information provided by or on behalf of the Company in making the decision to purchase the Purchased Shares. Farids understands and acknowledges that neither the Company nor any of the Company's representatives, agents or attorneys is making or has made at any time any warranties or representations of any kind or character, express or implied, with respect to any matter or the Common Stock, except as expressly set forth herein. 11





ARTICLE IV BOARD NOMINATION RIGHTS Section 4.1 Springing Nomination Right. Subject to, and only upon the satisfaction of the conditions set forth in, this Section 4.1 and Section 4.5, (i) the Farids Group shall have the right to designate TF or, in the event of the death or permanent disability of TF, another individual that is reasonably acceptable to the Company to be a director of the Company (TF or its designee in such capacity, the Director Designee), and (ii) the Company shall cause the Director Designee to be nominated as a director of the Company unless and until such Director Designee is unwilling or unable to serve as a director. The rights and obligations of the Farids Group and the Company (including, without limitation, the right of the Farids Group to appoint the Director Designee and the obligation of the Company to cause the Director Designee to be nominated for election to the Board of Directors (other than with respect to the Annual Meeting)) set forth in this Article IV shall only be effective immediately after, and only upon, the date the Farids Group owns 5.0% or more of the issued and outstanding Common Stock. Subject to, and only upon the satisfaction of the conditions set forth in, this Section 4.1 and Section 4.5, it is understood and agreed that in the event that a vacancy is created at any time as a result of (i) the death or permanent disability of any Director Designee or (ii) the retirement, resignation or removal (with or without cause) of any Director Designee other than TF, then the Farids Group shall have the right to designate a replacement director (who shall be reasonably acceptable to the Company and shall satisfy the eligibility requirements in Section 4.3) to fill such vacancy. Section 4.2 Obligations of the Company. (a) Nomination; Insurance. On or prior to the date of this Agreement or TF's election to the Board of Directors at the Annual Meeting, as applicable, the Company shall have (x) nominated TF for election to the Board of Directors at the Annual Meeting, (y) entered into an Indemnification Agreement with TF as the Director Designee and (z) taken all necessary action for TF to be covered by the Company's existing directors' liability insurance policy. (b) Nomination. Subject to, and only upon the satisfaction of the conditions set forth in, this Section 4.1 and Section 4.5, the Company shall cause the Director Designee to be (x) nominated for election to the Board of Directors and included in the Board of Director's slate of nominees recommended to the shareholders of the Company for each election of directors, and recommend to the shareholders of the Company that the Director Designee be elected to the Board of Directors and (y) included in the proxy statement (if any) prepared by management of the Company in connection with soliciting proxies for every meeting of the shareholders of the Company called with respect to the election of members of the Board of Directors, and at every adjournment or postponement thereof, and on every action or approval by written consent of the shareholders of the Company or the Board of Directors with respect to the election of members of the Board of Directors. When applicable pursuant to Section 4.1 and Section 4.5, the Company shall use its commercially reasonable efforts to cause the election of the Director Designee and otherwise support the Director Designee for election in a manner no less rigorous and favorable than the manner in which the Company supports, and has historically supported, its other nominees in the aggregate. Except as otherwise required by applicable Law, the Company shall not take any action to cause the removal without cause of the Director Designee, unless it is directed to do so by the Farids Group. 12





Section 4.3 Eligibility of Director Designee. Notwithstanding the other provisions of this Article IV, the Company shall not be obligated to cause to be nominated for election to the Board of Directors (or to be included in the Board of Directors' slate of nominees to the Company's stockholders or any proxy statement prepared by management of the Company in connection with soliciting proxies for meetings of the stockholders of the Company called with respect to the election of members of the Board of Directors) or recommend to the Company's stockholders the election of the Director Designee in the event that (i) the Director Designee fails to satisfy all applicable requirements (other than those relating to independence) regarding qualifying as a director of the Company under (A) Nasdaq rules (or the rules of the principal market on which shares of Common Stock are then listed) regarding service as a director and (B) applicable Law; (ii) the Director Designee has been involved in any of the events enumerated in Item 2(d) or (e) of Schedule 13D under the Exchange Act, (iii) the Director Designee is currently the target of an investigation by any governmental authority or agency relating to felonious criminal activity or is subject to any order, decree, or judgment of any court or agency prohibiting service as a director of any public company or providing investment or financial advisory services or (iv) the Director Designee has declared or otherwise indicated (whether publicly or to the Company or the Board of Directors) that she or he is unwilling or unable to serve as a director or otherwise takes actions inconsistent with her or his election. If any event described in clause (i) through (iv) of the preceding sentence occurs, (x) if the Director Designee is TF, then the Farids Group shall forfeit its rights under this Agreement to designate the Director Designee as a member of the Board of Director and shall not have any right to a replacement designee and (y) if the Director Designee is an individual other than TF, then the TF Group shall designate a replacement designee who shall be reasonably acceptable to the Company and shall satisfy the eligibility requirements set forth in this Section 4.3 and such replacement designee shall thereafter constitute a Director Designee under this Agreement. The Company shall promptly notify the Farids Group in writing of any objection to the Director Designee in advance of the date on which proxy materials are mailed by the Company in connection with such election of directors. Section 4.4 Resignation. If Farids' Nomination Right set forth in this Article IV is currently applicable and is terminated pursuant to Section 4.5, at the request of the Company, the Director Designee shall offer to resign as a director effective immediately. Section 4.5 Termination. Subject to Section 4.1, the rights and obligations of the Farids Group and the Company (including, without limitation, the right of the Farids Group to appoint the Director Designee and the obligation of the Company to cause the Director Designee to be nominated for election to the Board of Directors) set forth in this Article IV (if applicable, the Nomination Right) shall terminate immediately after the date the Farids Group owns less than 5.0% of the issued and outstanding Common Stock of the Company, and the Director Designee shall no longer be deemed to be a Director Designee; provided further, that, even if the Farids Group owns 5.0% or more of the issued and outstanding Common Stock, such rights and obligations shall terminate on the earliest to occur of: (A) for purposes of determining the Nomination Right for the third Contract Year (as defined in the Exclusive Supplier Operating Agreement), the EA Revenue (as defined in the Warrant) for the second Contract Year is less than $[**], (B) for purposes of determining the Nomination Right for the fourth Contract Year, the EA Revenue for the third Contract Year is less than $[**]; (C) for purposes of determining the Nomination Right for the fifth Contract Year, the EA Revenue for the fourth Contract Year is less than $[**]; or (D) for purposes of determining the Nomination Right for the 12-month period following the fifth Contract Year, the EA Revenue for the fifth Contract Year is less than $[**]. 13





ARTICLE V RESTRICTIONS ON TRANSFER Section 5.1 Restrictions on Transfer. (a) Until the second anniversary of the Closing Date, the Farids Group agrees not to make any Transfer of all or any portion of the Purchased Shares, except that the Farids Group shall be permitted to make Permitted Transfers. (b) Notwithstanding anything to the contrary in this Agreement, the Farids Group agrees that it will not effect any Transfer of Purchased Shares unless such Transfer is made pursuant to an effective registration statement under the Securities Act or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and, in either case, in compliance with all applicable state securities laws and all applicable securities laws of any other jurisdiction. The Company agrees, and the Farids Group understands and consents, that the Company will not take any action to cause or permit the Transfer of any Purchased Shares to be made on its books (or on any register of securities maintained on its behalf) unless the Transfer is permitted by and has been made in accordance with the terms of this Agreement and all applicable securities laws. The Farids Group agrees that in connection with any Transfer of Purchased Shares that is not made pursuant to a registration statement, the Company may, in its sole discretion, request an opinion, certifications and other information in form and substance reasonably satisfactory to the Company and from counsel reasonably satisfactory to the Company stating that such transaction is exempt from registration under the Securities Act. (c) The Purchased Shares shall be stamped or otherwise imprinted with legends substantially similar to the following (in addition to any legend required under applicable state securities laws) or if held in electronic form, shall be held in an account by the Company's stock transfer agent subject to restrictions on Transfer substantially consistent with the following legend, which shall be furnished in accordance with applicable Law: THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ACT), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT COVERING ANY SUCH TRANSACTION OR (B) PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER, SUBJECT TO THE COMPANY'S RIGHT TO RECEIVE AN OPINION OF COUNSEL, CERTIFICATIONS AND OTHER INFORMATION IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY AND FROM COUNSEL REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH TRANSACTION IS EXEMPT FROM SUCH REGISTRATION REQUIREMENTS. 14





THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN STRATEGIC ALLIANCE AGREEMENT DATED AS OF DECEMBER 20, 2019, AMONG FARIDS & CO. LLC, EDIBLE ARRANGEMENTS, LLC AND THE COMPANY (AS THE SAME MAY BE AMENDED AND IN EFFECT FROM TIME TO TIME). NO SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH STRATEGIC ALLIANCE AGREEMENT. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY. (d) The Farids Group acknowledges and agrees that any Transfer of the limited liability company interests, partnership interests, shares or other similar equity interests in any member of the Farids Group or a parent entity of such member will be deemed to constitute a Transfer of Purchased Shares, and any proposed Transfer of all or any portion of any such interests in any member of the Farids Group or a parent entity of such member shall be subject to compliance with the terms of this Agreement as such terms apply to the Farids Group. (e) The Company acknowledges and agrees that the Farids Group may from time to time pledge, and/or grant a security interest in, some or all of the legended Purchased Shares in connection with applicable securities laws, pursuant to a bona fide margin agreement in compliance with a bona fide margin loan. Such a pledge would not be subject to approval or consent of the Company and no legal opinion of legal counsel to the pledgee, secured party or pledgor shall be required in connection with the pledge, but such legal opinion shall be required in connection with a subsequent transfer or foreclosure following default by the Farids Group transferee of the pledge. No notice shall be required of such pledge, but the Farids Group's transferee shall promptly notify the Company of any such subsequent transfer or foreclosure. The Farids Group acknowledges that the Company shall not be responsible for any pledges relating to, or the grant of any security interest in, any of the Purchased Shares or for any agreement, understanding or arrangement between the Farids Group and its pledgee or secured party. At the Farids Group's expense, the Company will execute and deliver such reasonable documentation as a pledgee or secured party of Purchased Shares may reasonably request in connection with a pledge or transfer of the Purchased Shares, including the preparation and filing of any required prospectus supplement under Rule 424(b)(3) of the Securities Act or other applicable provision of the Securities Act to appropriately amend the list of selling stockholders thereunder. (f) The legend set forth in Section 5.1(c) above shall be removed and the Company shall issue one or more certificates without such legend or any other legend to the holder of the Purchased Shares upon which it is stamped or issue to such holder by electronic delivery, if (i) such Purchased Shares are registered for resale under the Securities Act, (ii) such Purchased Shares are sold or transferred pursuant to Rule 144, or (iii) such Purchased Shares are eligible for resale under the Securities Act without regard to current public information, manner of sale or volume limitations. Any fees (with respect to the Company's transfer agent, Company counsel or otherwise) associated with the removal of such legend shall be borne by the Company. 15





Section 5.2 Remedy for Prohibited Transfer. In the event that any member of the Farids Group Transfers any Purchased Shares in contravention of Section 5.1, such Transfer shall be null and void, and the Company agrees it will not take any action to effect such a Transfer nor will it treat any alleged transferee as the holder of such Purchased Shares. ARTICLE VI REGISTRATION RIGHTS Section 6.1 Demand Registration. (a) If the Company shall receive a written request (a Demand Request) from the Farids Group that the Company file a registration statement under the Securities Act covering the registration of all or a portion of the Registrable Securities owned by the Farids Group, then the Company shall, subject to the limitations of this Section 6.1, effect, as expeditiously as reasonably possible, the registration under the Securities Act of all Registrable Securities in accordance with the intended method of distribution thereof that the Farids Group requests to be registered, subject to the provisions of Section 6.1(c); provided, however, that any Eligible Resale Registration Statement shall be filed within 90 days following receipt of such Demand Request and any Resale Shelf Registration Statement shall be filed within 30 days following receipt of such Demand Request, as applicable. The Farids Group shall have the right to make two (2) Demand Requests on or after the date that is the second anniversary of the date of this Agreement; provided, that the Farids Group shall not make more than one (1) Demand Request within any six-month period. (b) If the Farids Group intends to distribute the Registrable Securities covered by its request by means of an underwritten public offering, it shall so advise the Company as a part of their request made pursuant to this Section 6.1. The Farids Group shall have the right to select the investment bank or banks and managers to administer any offering made in connection with a Demand Request, including the lead managing underwriter; provided that such investment banks or managers shall be reasonably acceptable to the Company; provided, further, that if the Farids Group declines to exercise such right, the Company shall select the investment bank or banks and managers to administer the offering, but the Farids Group shall continue to have such right pursuant to this Section 6.1(b) in any subsequent underwritten public offering. (c) Notwithstanding anything herein to the contrary, the Company shall not be obligated to (i) effect a registration pursuant to Section 6.1 unless the Registrable Securities requested to be registered by the Farids Group, together with all other shares of Common Stock requested to be registered by any other holder of piggyback registration rights (each, an Other Piggyback Holder) pursuant to any agreement containing similar registration rights as those contained in this Article VI (such other shares, the Other Registrable Securities), are reasonably expected to result in aggregate gross cash proceeds in excess of (x) in the case of a Resale Shelf Registration Statement, three (3) million dollars ($3,000,000) and (y) in the case of any other form of registration statement, one (1) million dollars ($1,000,000) or (ii) prepare, file, effect or maintain a shelf registration statement on Form S-3 (or any successor to Form S-3) or any similar shelf registration statement (other than a Resale Shelf Registration Statement) under the Securities Act for the purposes of compliance with any Demand Right pursuant to this Section 6.1. 16





Section 6.2 Piggyback Registrations. (a) From and after the second anniversary of the date of this Agreement, the Company shall notify the Farids Group (unless the Farids Group has demanded such registration pursuant to Section 6.1) in writing at least five (5) business days prior to the initial public filing of any Eligible Registration Statement. Such notice from the Company shall state the intended method of distribution of the Registrable Securities included in such Eligible Registration Statement. The Company shall afford the Farids Group the opportunity to include Registrable Securities in such Eligible Registration Statement so long as it agrees to sell its Registrable Securities pursuant to the same method of distribution. If the Farids Group desires to include Registrable Securities held by it in any such Eligible Registration Statement, it shall, within four (4) business days after the above-described notice from the Company, so notify the Company in writing. Any such notice from the Farids Group shall (i) specify the amount of Registrable Securities that the Farids Group would like to include in such Eligible Registration Statement and (ii) include the agreement of the Farids Group to participate in any related underwritten offering on the same terms as the other participating Holders. Upon such written notice from the Farids Group, the Company will use its best efforts to effect the registration under the Securities Act of all Registrable Securities which the Farids Group has requested to be registered. If the Farids Group decides not to or is unable to include all of its Registrable Securities in any Eligible Registration Statement filed by the Company, the Farids Group shall nevertheless continue to have the right to include Registrable Securities in any subsequent Eligible Registration Statement as may be filed by the Company, all upon the terms and conditions set forth herein. Prior to the effectiveness of the applicable Eligible Registration Statement, the Farids Group may withdraw from such Eligible Registration Statement any of the Registrable Securities at any time upon written notice to the Company. (b) Underwriting. If the Eligible Registration Statement under which the Company gives notice under this Section 6.2 is for an underwritten offering, the Company shall so advise the Farids Group. In such event, the right of the Farids Group to be included in an Eligible Registration Statement pursuant to this Section 6.2 shall be conditioned upon the Farids Group's participation in such underwriting by executing and delivering a custody agreement and power of attorney in form and substance reasonably satisfactory to the Company with respect to such Registrable Securities (the Custody Agreement and Power of Attorney), which Custody Agreement and Power of Attorney shall permit the Farids Group to, prior to the effectiveness of such Eligible Registration Statement, withdraw any of the Registrable Securities at any time from such Eligible Registration Statement upon written notice to the Company and the custodian. The Custody Agreement and Power of Attorney will provide, among other things, that (i) the Farids Group will, to the extent applicable, deliver to and deposit in custody with the custodian and attorney-in-fact named therein one or more certificates representing such Registrable Securities, accompanied by duly executed stock powers in blank, and irrevocably appoint said custodian and attorney-in-fact with full power and authority to act under the Custody Agreement and Power of Attorney on the Farids Group's behalf with respect to the matters specified therein, including, but not limited to, the entry into an underwriting agreement (the Underwriting Agreement) in customary form with the underwriter(s) and such other documents and agreements reasonably required in connection with such registration or offering and (ii) the Farids Group will perform its obligations under such Underwriting Agreement and any other agreement entered into in connection with such registration and/or offering. The Farids Group also agrees to execute such other documents and agreements as the Company may reasonably request to effect the provisions of this Section 6.2 and any transactions contemplated hereby. 17





Section 6.3 Priority on Registrations. Notwithstanding any other provision of this Article VI, if the lead managing underwriter or underwriters advise, in the case of a requested registration pursuant to Section 6.1, the Farids Group or, in all other cases, the Company that marketing factors (including, but not limited to, an adverse effect on the per share offering price) require a limitation of the number of shares to be included in an underwritten offering (including Registrable Securities), then the Farids Group or the Company, as the case may be, shall so advise all holders of Registrable Securities and all Other Piggyback Holders who have requested to participate in such offering, that (i) if the requested registration is pursuant to Section 6.1, the number of shares that may be included in the underwriting shall be allocated first to the Farids Group for its own account, and second to the Company (to the extent it is selling shares of Common Stock in such offering) and the Other Piggyback Holders who have duly requested shares to be included therein on a pro rata basis based on the number of shares proposed to be sold by the Company and the number of Other Registrable Securities requested to be included by such Other Piggyback Holders, and (ii) if the requested registration is not pursuant to Section 6.1, the number of shares that may be included in the underwriting shall be allocated first to the Company for its own account (to the extent such registration was initiated by the Company) or to such Holder of Other Registrable Securities who demanded such registration pursuant to demand rights similar to those set forth in this Agreement, and second to the Company (to the extent such registration was not initiated by the Company), the Farids Group and the Other Piggyback Holders who have duly requested shares to be included therein on a pro rata basis based on the number of shares proposed to be sold by the Company (to the extent such registration was not initiated by the Company), the number of Registrable Securities requested to be included by the Farids Group and the number of Other Registrable Securities requested to be included by all such Other Piggyback Holders. For any Other Piggyback Holder which is a partnership, limited liability company or corporation, the partners, members or shareholders, as applicable, of such Other Piggyback Holder and the estates and Family Members of any such partners, members and shareholders and any trusts for the benefit of any of the foregoing Person(s) shall be deemed to be a single Other Piggyback Holder, and any pro rata reduction with respect to such Other Piggyback Holder pursuant to this Section 6.3 shall be based upon the aggregate amount of shares carrying registration rights owned by all Persons deemed to constitute such Other Piggyback Holder (as defined in this sentence). Section 6.4 Termination, Effectiveness, Postponement and Suspension of Registration. (a) Right to Terminate Registration. If the Farids Group determines for any reason not to proceed with any proposed registration requested pursuant to Section 6.1, the Farids Group shall promptly notify the Company in writing. Upon receipt of such notice, the Company shall withdraw or terminate such registration whether or not any Other Piggyback Holder has elected to include any Other Registrable Securities in such registration. In addition, the Company shall have the right to withdraw or terminate any proposed registration initiated by it and a Holder of Other Registrable Securities shall have the right to withdraw or terminate any proposed registration initiated by it, whether or not the Farids Group or any Other Piggyback Holder has elected to include Registrable Securities or Other Registrable Securities, as the case may be, in such registration. The Company shall promptly give notice of the withdrawal or termination of any registration to the Farids Group, to the extent the Farids Group has elected to participate in such registration. The Registration Expenses of any such withdrawn or terminated registration shall be borne by the Company in accordance with Section 6.5. 18





(b) Effectiveness of the Registration Statement. The Company shall maintain the effectiveness of the Eligible Registration Statement until the earlier of (i) the date on which all Registrable Securities included in such Eligible Registration Statement have actually been sold and (ii) the date that is (x) 180 days (in respect of a Resale Shelf Registration Statement) or (y) 90 days (in respect of any Eligible Registration Statement other than a Resale Shelf Registration Statement) from the effective date of such Eligible Registration Statement. (c) Postponement or Suspension of Registration. If the filing, initial effectiveness or continued use of an Eligible Registration Statement in respect of a registration pursuant to this Agreement at any time would require the Company to make a public disclosure of material non-public information, (1) which disclosure in the good faith judgment of the Board of Directors (after consultation with external legal counsel) (x) would be required to be made in any registration statement so that such registration statement would not contain a material misstatement or omission, (y) would not be required by applicable Law to be made at such time but for the filing, effectiveness or continued use of such Eligible Registration Statement and (z) would reasonably be expected to have a Company Material Adverse Effect or a material adverse effect on the Company's ability to effect a material proposed acquisition, disposition, financing, business opportunity, reorganization, recapitalization or similar transaction or (2) during a customary blackout period of the Company, then the Company may, upon giving prompt written notice of such determination to the Farids Group, delay the filing or initial effectiveness of, or suspend the use of, such Eligible Registration Statement; provided, that the Company shall not be permitted to do so pursuant to clause (1) above (x) more than two times during any twelve (12) month period or (y) for a period exceeding thirty (30) days on any one occasion (unless a longer period is consented to by the Farids Group) (the Suspension Period). In the event the Company exercises its rights under the preceding sentence, the Farids Group agrees to suspend, promptly upon its receipt of the notice referred to above, its use of any prospectus relating to such registration in connection with any sale or offer to sell Registrable Securities. If so requested by the Company, the Farids Group shall use its reasonable best efforts to deliver to the Company (at the Company's expense) all copies, other than permanent file copies then in the Farids Group's possession, of the prospectus relating to such Registrable Securities at the time of receipt of such notice. The Company agrees that, in the event it exercises its rights under this Section 6.4(c), it shall (i) promptly notify the Farids Group of the termination or expiration of any Suspension Period, (ii) within thirty (30) days after delivery of the notice referred to above (unless a longer period is consented to by the Farids Group), resume the process of filing or request for effectiveness, or update the suspended registration statement, as the case may be, as may be necessary to permit the Farids Group to offer and sell its Registrable Securities in accordance with applicable Law and (iii) if an Eligible Registration Statement that was already effective had been suspended as result of the exercise of such rights by the Company, promptly notify the Farids Group after the termination or expiration of any Suspension Period of the applicable time period during which the Eligible Registration Statement is to remain effective, which shall be extended by a period of time equal to the duration of the Suspension Period. 19





Section 6.5 Expenses of Registration. Except as specifically provided herein, all Registration Expenses incurred in connection with any registration under Sections 6.1 and 6.2 shall be borne by the Company. All underwriting fees and selling commissions relating to the distribution of the Registrable Securities and all taxes, if any, on the transfer and sale, respectively, of the Registrable Securities being sold that are incurred in connection with any registrations hereunder shall be borne by the Farids Group. For the avoidance of doubt, all underwriting fees, selling commissions and taxes incurred in connection with any registration hereunder relating to securities sold by the Company shall be borne by the Company. Section 6.6 Obligations of the Company. If and whenever the Company is required to effect the registration of any Registrable Securities under the Securities Act as provided in Sections 6.1 and 6.2 (to the extent the Farids Group has requested to include Registrable Securities in an Eligible Registration Statement pursuant to clause (a) of such Section 6.1 or 6.2, as the case may be), the Company shall effect such registration to permit the sale of such Registrable Securities in accordance with the intended method or methods of distribution thereof, and pursuant thereto the Company shall cooperate in the sale of the securities and shall, as expeditiously as reasonably possible: (a) Prepare and file with the SEC an Eligible Registration Statement on such form as shall be available for the sale of the Registrable Securities by the Farids Group in accordance with the intended method of distribution thereof and the provisions of this Article VI, and use its reasonable best efforts to cause each such Eligible Registration Statement to become effective and remain effective as provided herein; provided, however, that before filing any Eligible Registration Statement or Prospectus or any amendments or supplements thereto (not including documents that would be incorporated or deemed to be incorporated therein by reference), the Company shall afford the Farids Group, its counsel and the managing underwriter, if any, an opportunity to review copies of all such documents proposed to be filed. The Company shall not file any Eligible Registration Statement or Prospectus or any amendments or supplements thereto in respect of which the Farids Group has a right to review prior to the filing of such document, if the Farids Group, its counsel or the managing underwriter, if any, shall reasonably object, in writing, on a timely basis. (b) Prepare and file with the SEC such amendments and post-effective amendments to each Eligible Registration Statement as may be necessary to keep such Eligible Registration Statement continuously effective for the effectiveness period; and comply with the provisions of the Securities Act, the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to it with respect to the disposition of all securities covered by such Eligible Registration Statement as so amended or in such Prospectus as so supplemented. 20





(c) Notify the Farids Group, its counsel and the managing underwriter, if any, promptly (but in any event within 10 business days), and confirm such notice in writing, (i) when a Prospectus or any prospectus supplement or post-effective amendment has been filed, and, with respect to an Eligible Registration Statement or any post-effective amendment, when the same has become effective (including in such notice a written statement that the Farids Group may, upon request, obtain, without charge, one conformed copy of such Eligible Registration Statement or post-effective amendment including financial statements and schedules, all documents incorporated or deemed to be incorporated by reference and all exhibits), (ii) of the issuance by the SEC of any stop order suspending the effectiveness of a Eligible Registration Statement or of any order preventing or suspending the use of any preliminary prospectus or the initiation of any proceedings for that purpose, (iii) if at any time when a prospectus is required by the Securities Act to be delivered in connection with sales of the Eligible Registrable Securities the representations and warranties of the Company contained in any agreement (including any underwriting agreement) contemplated by Section 6.6(k) below cease to be true and correct in all material respects, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of an Eligible Registration Statement or any of the Registrable Securities for offer or sale in any jurisdiction, or the initiation or threatening of any proceeding for such purpose, (v) of the happening of any event that makes any statement made in such Eligible Registration Statement or related Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires the making of any changes in such Eligible Registration Statement, Prospectus or documents so that, in the case of such Eligible Registration Statement, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the Prospectus, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (vi) of the Company's reasonable determination that a post-effective amendment to an Eligible Registration Statement would be appropriate. (d) Use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of an Eligible Registration Statement or of any order preventing or suspending the use of a Prospectus or suspending the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction, and, if any such order is issued, to obtain the withdrawal of any such order at the earliest possible moment. (e) If requested by the managing underwriter, if any, or the Farids Group, (i) promptly incorporate in a post-effective amendment such information as the managing underwriter, if any, or the Farids Group reasonably requests to be included therein to comply with applicable Law, (ii) make all required filings of such post-effective amendment as soon as practicable after the Company has received notification of the matters to be incorporated in such post-effective amendment, and (iii) supplement or make amendments to such Eligible Registration Statement; provided, however, that the Company shall not be required to take any actions under this Section 6.6(e) that are not, in the opinion of counsel for the Company, in compliance with applicable Law. (f) Furnish to the Farids Group and each managing underwriter, if any, without charge, one conformed copy of the Eligible Registration Statement or Statements and each post-effective amendment thereto, including financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference and all exhibits. 21





(g) Deliver to the Farids Group, its counsel and the underwriters, if any, without charge, as many copies of the Prospectus or Prospectuses (including each form of prospectus) and each amendment or supplement thereto as such Persons may reasonably request; and, the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by the Farids Group and the underwriters, if any, in connection with the offering and sale of the Registrable Securities covered by such Prospectus and an amendment or supplement thereto. (h) Prior to any public offering of Registrable Securities, to use its reasonable best efforts to register or qualify, and cooperate with the Farids Group, the underwriters, if any, the sales agent and their respective counsel in connection with the registration or qualification (or exemption from such registration or qualification) of such Registrable Securities for offer and sale under the securities or blue sky laws of such jurisdictions within the United States as the Farids Group or the managing underwriter, if any, reasonably request in writing; use its reasonable best efforts to keep each such registration or qualification (or exemption therefrom) effective during the period during which the related Eligible Registration Statement is required to be kept effective and use its reasonable best efforts to do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the applicable Eligible Registration Statement; provided, however, that the Company will not be required to (A) qualify generally to do business in any jurisdiction where it is not then so qualified or (B) take any action that would subject it to general service of process or taxation in any such jurisdiction where it is not then so subject. (i) Upon the occurrence of any event contemplated by clause (v) or (vi) of Section 6.6(c) above, as promptly as practicable prepare a supplement or post-effective amendment to the Eligible Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, such Prospectus will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. (j) Enter into an underwriting agreement in form, scope and substance as is customary in underwritten offerings and take all such other actions as are reasonably requested by the managing underwriter in order to expedite or facilitate the registration or the disposition of such Registrable Securities, and in such connection, (i) make such customary representations and warranties to the underwriters, with respect to the business of the Company and its subsidiaries, and the Eligible Registration Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference therein; (ii) obtain opinions of counsel to the Company and updates thereof (which counsel and opinions shall be reasonably satisfactory (in form, scope and substance) to the managing underwriter), addressed to the underwriters covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by the underwriters; and (iii) obtain comfort letters and updates thereof from the independent certified public accountants of the Company (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Eligible Registration Statement), addressed to each of the underwriters, such letters to be in customary form and covering matters of the type customarily covered in comfort letters in connection with underwritten offerings. The above shall be done at each closing under such underwriting agreement, or as and to the extent required thereunder. 22





(k) Use its reasonable best efforts to cause all Registrable Securities covered by such Eligible Registration Statement to be listed on each securities exchange on which the Common Stock is then listed. (l) Comply with all applicable rules and regulations of the SEC and make generally available to its security-holders earnings statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) (i) commencing at the end of any fiscal quarter in which Registrable Securities are sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effectiveness date of an Eligible Registration Statement, which statements shall cover said 12-month periods. Section 6.7 Delay of Registration; Furnishing Information. It shall be a condition precedent to the obligations of the Company to take any action pursuant to Section 6.1 or 6.2 that the Farids Group shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of distribution of such securities as required by Section 6.12 or as otherwise reasonably requested by the Company. Section 6.8 Indemnification. In the event any Registrable Securities are included in an Eligible Registration Statement under Section 6.1 or 6.2: (a) To the fullest extent permitted by law, the Company will indemnify and hold harmless the Farids Group, the partners, members, directors and officers of any member of the Farids Group, any underwriter (as defined in the Securities Act), the directors and officers of such underwriter, and each person, if any, who controls any member of the Farids Group or such underwriter within the meaning of the Securities Act or the Exchange Act (collectively, the Non-Company Indemnified Parties), against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or suits, actions or proceedings in respect thereof) and reasonable documented expenses that arise out of or are based upon any of the following statements, omissions or violations by the Company: (i) any untrue statement or alleged untrue statement of a material fact contained in such Eligible Registration Statement or incorporated by reference therein, including any preliminary prospectus, final prospectus or summary prospectus contained therein or any amendments or supplements thereto or any document incorporated by reference therein, or any other such disclosure document (including reports and other documents filed under the Exchange Act and any document incorporated by reference therein) or related document or report, (ii) any omission or alleged omission to state therein a material fact required to be stated therein (in the case of an Eligible Registration Statement only), or necessary to make the statements therein not misleading, in the case of a prospectus, in the light of the circumstances when they were made, or (iii) any violation or alleged violation by the Company or any of its subsidiaries of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any federal, state, foreign or common law, rule or regulation in connection with the offering covered by such Eligible Registration Statement (collectively, a Violation); and the Company will reimburse each such Non-Company Indemnified Party for any reasonable legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability, suit, action or proceeding; provided, however, that the indemnity agreement contained in this Section 6.8(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, suit, action or proceeding if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, delayed or conditioned, nor shall the Company be liable in any such case for any such loss, claim, damage, liability, suit, action or proceeding to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such Eligible Registration Statement by such Non-Company Indemnified Party. 23





(b) To the fullest extent permitted by law, the Farids Group will, jointly and severally, indemnify and hold harmless the Company, each of its directors, officers, employees, agents, representatives, and each person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act, any underwriter (as defined in the Securities Act), the directors and officers of such underwriter, and each person, if any, who controls such underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages or liabilities (joint or several) to which the Company or any such director, officer, employee, agent, representative, controlling person or underwriter may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or suits, actions or proceedings in respect thereof) and reasonable documented expenses that arise out of or are based upon any of the following statements, omissions or violations: (i) any untrue statement or alleged untrue statement of a material fact contained in such Eligible Registration Statement or incorporated by reference therein, including any preliminary prospectus, final prospectus or summary prospectus contained therein or any amendments or supplements thereto or any document incorporated by reference therein, or any other such disclosure document (including reports and other documents filed under the Exchange Act and any document incorporated by reference therein) or related document or report, (ii) any omission or alleged omission to state therein a material fact required to be stated therein (in the case of an Eligible Registration Statement only), or necessary to make the statements therein not misleading, in the case of a prospectus, in the light of the circumstances when they were made, or (iii) any violation or alleged violation by the Company or any of its subsidiaries of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any federal, state, foreign or common law, rule or regulation in connection with the offering covered by such Eligible Registration Statement (collectively, a Holder Violation), in each case to the extent (and only to the extent) that such Holder Violation occurs in reliance upon and in conformity with written information furnished by the Farids Group expressly for use in connection with such Eligible Registration Statement; and the Farids Group will reimburse any legal or other expenses reasonably incurred by the Company or any such director, officer, employee, agent, representative, controlling person or underwriter in connection with investigating or defending any such loss, claim, damage, liability, suit, action or proceeding if it is judicially determined that there was such a Holder Violation; provided, however, that the indemnity agreement contained in this Section 6.8(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, suit, action or proceeding if such settlement is effected without the consent of the Farids Group, which consent shall not be unreasonably withheld, delayed or conditioned; provided, further, that in no event shall any indemnity under this Section 6.8(b) exceed the net proceeds from the offering received by the Farids Group upon the sale of the Registrable Securities giving rise to such indemnification obligation. 24





(c) Promptly after receipt by an indemnified party under paragraph (a) or (b) of this Section 6.8 (an Indemnified Party) of written notice of the commencement of any claim, damage, suit, action or proceeding (including any governmental or regulatory investigation) being brought or asserted against it, such Indemnified Party will, if a claim in respect thereof is to be made against any indemnifying party under paragraph (a) or (b) of this Section 6.8 (an Indemnifying Party), deliver to the Indemnifying Party a written notice of the commencement thereof; provided, that the failure of the Indemnified Party to deliver written notice to the Indemnifying Party shall not relieve it from any liability it may have under paragraph (a) or (b) of this Section 6.8 except to the extent such failure has materially prejudiced the Indemnifying Party's ability to defend such action (through the forfeiture of substantive rights or defenses). The Indemnifying Party shall have the right to participate in, and, to the extent the Indemnifying Party so desires, jointly with any other Indemnifying Party who has received a similar notice, to assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party to represent the Indemnified Party in such proceeding and shall pay the fees and expenses of such counsel relating to such proceeding, and after notice from the Indemnifying Party to the Indemnified Party of its election so to assume the defense thereof, the Indemnifying Party shall not, except as specified below, be liable to such Indemnified Party under paragraph (a) or (b) above, as the case may be, for any legal expenses of other counsel. In any such proceeding, an Indemnified Party shall have the right to retain its own counsel, with the fees and expenses to be paid by the Indemnified Party; provided the Indemnifying Party will pay the reasonable fees and expenses of such counsel if (i) the Indemnifying Party and the Indemnified Party shall have so mutually agreed; (ii) the Indemnifying Party has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Party; (iii) the Indemnified Party shall have reasonably concluded, based on the advice of counsel, that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Party; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Party and the Indemnified Party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them. It is understood and agreed that the Indemnifying Party shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel that is required to effectively defend against any such proceeding) for all Indemnified Parties, and that all such fees and expenses shall be paid or reimbursed promptly. The Indemnifying Party shall not be liable for any settlement of any proceeding effected without its written consent (which shall not be unreasonably withheld, delayed or conditioned), but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Party agrees to indemnify each Indemnified Party from and against any loss or liability by reason of such settlement or judgment. No Indemnifying Party shall, without the written consent of the Indemnified Party (which shall not be unreasonably withheld, delayed or conditioned), effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Party is or could have been a party and indemnification could have been sought hereunder by such Indemnified Party, unless such settlement (x) includes an unconditional release of such Indemnified Party, in form and substance reasonably satisfactory to such Indemnified Party, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Party. 25





(d) If the indemnification provided for in this Section 6.8 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any losses, claims, damages or liabilities referred to herein, the Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder, shall to the extent permitted by applicable Law contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the actions that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; provided, that in no event shall any contribution by a Holder hereunder exceed the net proceeds from the offering made under such Eligible Registration Statement received by such Holder. (e) The parties hereto agree that it would not be just and equitable if contribution pursuant to Section 6.8(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (f) The obligations of the Company and the Farids Group under this Section 6.8 shall survive completion of any offering of Registrable Securities in an Eligible Registration Statement and the termination of this Agreement. (g) The obligations of the parties under this Section 6.8 will be in addition to any liability, without duplication, which any party may otherwise have to any other party. Section 6.9 Market Stand-Off Agreement. The Farids Group hereby agrees that the Farids Group shall not Transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale or other Transfer, any Lock-Up Security held by the Farids Group (other than those included in the registration) for a period specified by the representative(s) of the underwriters of Registrable Securities or any other securities sold in any offering in respect of which the Farids Group received notice from the Company in accordance with Section 6.2, such period not to exceed one hundred and eighty (180) days following the pricing date of any underwritten offering; provided that the Farids Group shall only be required to comply with this Section 6.9 if the Farids Group beneficially own (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) at least 3.0% or more of the number of shares of Common Stock outstanding at such time. The Company may impose stop transfer instructions with respect to any Lock-Up Security subject to the foregoing restriction until the end of said one hundred and eighty (180) day or shorter period. 26





Section 6.10 Agreement to Furnish Information. The Farids Group agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the representative(s) of the underwriter(s) that are consistent with the Farids Group's obligations under Section 6.9 or that are necessary to give further effect thereto. In addition, if requested by the Company or such representative(s), the Farids Group shall provide, to the extent the Farids Group has elected to include Registrable Securities in an Eligible Registration Statement, within one (1) business day of such request, such information relating to itself, the Registrable Securities held by it and the registration and the intended method of distribution of the Registrable Securities as may be reasonably requested by the Company or such representative(s) in connection with the completion of any public offering of Common Stock pursuant to such Eligible Registration Statement. The underwriters of Registrable Securities are intended third party beneficiaries of Sections 6.8 and 6.10 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Section 6.11 Termination. The rights and obligations of the Farids Group set forth in this Article VI (other than those set forth in Sections 6.8 and 6.9) shall terminate on the date that the Farids Group owns less than 3% of the issued and outstanding Common Stock, but in no event earlier than the Expiration Date (as defined in the Warrant). ARTICLE VII RIGHT OF FIRST REFUSAL; CHANGE IN CONTROL Section 7.1 Right of First Offer for 144 Sales. (a) Subject to the restrictions set forth in Section 5.1 of this Agreement and Section 2.3 of the Warrant, in the event any member of the Farids Group proposes to Transfer (other than a Permitted Transfer) a Threshold Block, in a transaction or series of related transactions, of Shares in a 144 Sale, the Farids Group shall furnish to the Company a written notice of such proposed Transfer (a ROFO Sale Notice) at least 48 hours prior to the opening of trading on the Nasdaq Global Market (or such other primary stock exchange upon which the Common Stock is listed) on the business day that the Farids Group proposes to begin to effect such 144 Sale. (b) The ROFO Sale Notice shall include: (i) (A) the number of Shares proposed to be sold (the ROFO Shares), (B) the per share purchase price in cash at which the Farids Group is prepared to Transfer such ROFO Shares (the ROFO Sale Price) and (C) the date the Farids Group proposes to begin to effect such 144 Sale; and (ii) (ii) an offer to sell to the Company and/or a designee of the Company all or a portion of the ROFO Shares at the ROFO Sale Price. (c) If the Company wishes to purchase (and/or cause a designee to purchase) all or a portion of the ROFO Shares at the ROFO Sale Price, the Company shall deliver a notice (a ROFO Purchase Notice) to the Farids Group no later 8:00 a.m. New York time on the business day that the Farids Group proposes to effect such 144 Sale specifying the number of ROFO Shares it wishes to purchase (and/or cause a designee to purchase) from the Farids Group. The closing of the purchase of such ROFO Shares by the Company and/or any such designee shall take place no later than five (5) business days after delivery of the ROFO Purchase Notice, with payment for such ROFO Shares being made concurrently with such purchase to the Farids Group's account designated in the ROFO Sale Notice. If the Company does not timely deliver a ROFO Purchase Notice it shall be deemed to have waived all of its rights with respect to the offer contained in the ROFO Sale Notice. 27





(d) In the event that the number of ROFO Shares offered to be purchased in the ROFO Purchase Notice is less than the number of ROFO Shares set forth in the Sale Notice (or the Company does not timely deliver a ROFO Purchase Notice), the Farids Group may sell the ROFO Shares that are not subject to any such ROFO Purchase Notice during the five (5) day business day period beginning on the date in the ROFO Sale Notice on which the Farids Group proposed to begin to effect such 144 Sale (the ROFO Transfer Period); provided that no such ROFO Share may be sold for less than the ROFO Sale Price. (e) (e) If by the expiration of the ROFO Transfer Period, the Farids Group has not completed the Transfer of any ROFO Shares at the ROFO Sales Price or a higher price, in order for the Farids Group to Transfer such ROFO Shares (or any other Shares) it shall be necessary for a new ROFO Sale Notice or ROFR Sale Notice to be delivered, and the terms and provisions of this Article VII to be again complied with. The Farids Group shall not deliver more than one ROFO Sale Notice or ROFR Sale Notice in any thirty (30) day period. Section 7.2 Right of First Refusal. (a) Subject to the restrictions set forth in Section 5.1 of this Agreement and Section 2.3 of the Warrant, in the event any member of the Farids Group proposes to Transfer (other than a Permitted Transfer) (i) a Threshold Block, in a transaction or series of related transactions, that, to the Farids Group's knowledge (after due inquiry in connection with a private, non-open market transaction) is to a Person whom the Company reasonably determines is a direct or indirect material competitor of the Company or any Affiliate of such Person or (ii) a Significant Block, in a transaction or series of related transactions, that, to the Farids Group's knowledge (after due inquiry in connection with a private, non-open market transaction) is to a Person whom the Company reasonably determines is a direct or indirect material competitor of the Company or any Affiliate of such Person (in each case, regardless of whether such Transfer will constitute a 144 Sale), the Farids Group shall furnish to the Company a written notice of such proposed Transfer (a ROFR Sale Notice) at least (5) business days prior to the business day that the Farids Group proposes to effect such Transfer. (b) The ROFR Sale Notice shall include: (i) (A) the identity of the proposed transferee, (B) the purchase agreement and other documentation for the proposed Transfer (the ROFR Sale Documentation), (C) the number of Shares proposed to be sold (the ROFR Shares), (D) the per share purchase price in cash at which the Farids Group is prepared to Transfer such ROFR Shares (the ROFR Sale Price) and (E) the date the Farids Group proposes to effect such Transfer; and 28





(ii) an offer to sell to the Company and/or a designee of the Company all of the ROFR Shares at the ROFR Sale Price. (c) If the Company wishes to purchase (and/or cause a designee to purchase) all of the ROFR Shares at the ROFR Sale Price, the Company shall deliver a notice (a ROFR Purchase Notice) to the Farids Group within three (3) business day after receipt of the ROFR Sale Notice. The closing of the purchase of such ROFR Shares by the Company and/or any such designee shall take place no later than the later of (i) the purchase date set forth in the ROFR Sale Documentation and (ii) five (5) business days after delivery of the ROFR Purchase Notice, with payment for such ROFR Shares being made concurrently with such purchase to the Farids Group's account designated in the ROFR Sale Notice. If the Company does not timely deliver a ROFR Purchase Notice it shall be deemed to have waived all of its rights with respect to the offer contained in the ROFR Sale Notice. (d) In the event that Company does not timely delivery a ROFR Purchase Notice, the Farids Group may sell the ROFR Shares to the proposed transferee identified in the ROFR Sale Notice at the ROFR Sale Price and on the other terms and conditions set forth in the ROFR Sale Documentation no later than three (3) business days following the date the Farids Group proposed to effect such Transfer in the ROFR Sale Notice (the ROFR Transfer Period). (e) If by the expiration of the ROFR Transfer Period, the Farids Group has not completed the Transfer of the ROFR Shares, in order for the Farids Group to Transfer such ROFR Shares (or any other Shares) it shall be necessary for a new ROFO Sale Notice or ROFR Sale Notice to be delivered, and the terms and provisions of this Article VII to be again complied with. The Farids Group shall not deliver more than one ROFR Sale Notice or ROFO Sale Notice in any thirty (30) day period. ARTICLE VIII MISCELLANEOUS Section 8.1 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally, telecopied (upon telephonic confirmation of receipt), on the first business day following the date of dispatch if delivered by a recognized next day courier service, or on the third business day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid. All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice: (a) if to the Company to: Rocky Mountain Chocolate Factory, Inc. 265 Turner Drive Durango, Colorado 81303 Attention: Chief Executive Officer and Chief Financial Officer 29





with a copy (which shall not constitute notice) to: Perkins Coie LLP 1900 Sixteenth Street, Suite 1400 Denver, Colorado 80202 Attention: Sonny Allison and Ned Prusse (b) If to the Farids Group to: Farids & Co. LLC 980 Hammond Dr., Suite 1000 Atlanta, GA 30328 USA Attention: Tariq Farid (c) If to EA to: Edible Arrangement, LLC 980 Hammond Dr., Suite 1000 Atlanta, GA 30328 USA Attention: Tariq Farid with a copy (which shall not constitute notice) to: DLA Piper LLP (US) 444 West Lake Street Suite 900 Chicago, IL 60606 Attention: Neal Aizenstein Section 8.2 Further Assurances. Each party hereto shall do and perform or cause to be done and performed all further acts and shall execute and deliver all other agreements, certificates, instruments and documents as any other party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. Section 8.3 Amendments and Waivers. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is duly executed and delivered by the Company and the Farids Group. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. The execution of a joinder agreement to this Agreement by a Family Member of TF shall not constitute an amendment to this Agreement requiring the consent of any party hereto. 30





Section 8.4 Fees and Expenses. Each party hereto shall pay all of its own fees and expenses (including attorneys' fees) incurred in connection with this Agreement and the transactions contemplated hereby. Section 8.5 Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, provided, that, unless in connection with Permitted Transfers, neither party may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement to any person without the express written consent of the other party hereto and any such assignment or other transfer shall be null and void; provided, further, that no such assignment shall relieve the assigning party of its obligations hereunder if such assignee does not perform such obligations. Prior to the receipt by the Company of adequate written notice of the Permitted Transfer of any Purchased Shares in accordance with the provisions of this Agreement and specifying the full name and address of the transferee, the Company may deem and treat the person listed as the holder of such shares in its records as the absolute owner and holder of such shares for all purposes, including the payment of dividends. Section 8.6 Governing Law. (a) This Agreement shall be governed and construed in accordance with the laws of the State of New York applicable to contracts made and wholly performed within such state, except for matters directly within the purview of the DGCL, which shall be governed by the DGCL. Each of the Farids Group and the Company hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction and venue of the United States District Court for the Southern District of New York and in the courts hearing appeals therefrom unless no basis for federal jurisdiction exists, in which event each party hereto irrevocably consents to the exclusive jurisdiction and venue of the Supreme Court of the State of New York, New York County, and the courts hearing appeals therefrom, for any action, suit or proceeding arising out of or relating to this Agreement and the transactions contemplated hereby. Each of the Farids Group and the Company hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any such action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of the aforesaid courts for any reason, other than the failure to serve process in accordance with this Section 8.6, that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise), and to the fullest extent permitted by applicable Law, that the action, suit or proceeding in any such court is brought in an inconvenient forum, that the venue of such action, suit or proceeding is improper, or that this Agreement, or the subject matter hereof, may not be enforced in or by such courts and further irrevocably waives, to the fullest extent permitted by applicable Law, the benefit of any defense that would hinder, fetter or delay the levy, execution or collection of any amount to which the party is entitled pursuant to the final judgment of any court having jurisdiction. Each of the Farids Group and the Company irrevocably and unconditionally waives, to the fullest extent permitted by applicable Law, any and all rights to trial by jury in connection with any action, suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. 31





(b) Each of the Farids Group and the Company expressly acknowledges that the foregoing waivers are intended to be irrevocable under the laws of the State of New York, the State of Delaware and of the United States of America; provided, that consent by the Farids Group and the Company to jurisdiction and service contained in this Section 8.6 is solely for the purpose referred to in this Section 8.6 and shall not be deemed to be a general submission to said courts or in the State of New York other than for such purpose. Section 8.7 Ownership Limitation. The Farids Group shall not (unless specifically requested in writing by the Company, acting through a resolution of a majority of the Company's directors), directly or indirectly, and agrees to cause the Affiliates of the Farid Group to not, directly or indirectly, in any manner acquire, offer or propose to acquire, or agree to acquire, directly or indirectly, whether by purchase, tender or exchange offer, through the acquisition of control of another person, by joining a partnership, limited partnership, syndicate or other group (including any group of persons that would be treated as a single person under Section 13(d) of the Exchange Act), through swap or hedging transactions or otherwise, any securities of the Company, or any rights decoupled from the underlying securities of the Company that would result in the Farids Group (together with its Affiliates) owning, controlling or otherwise having any beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of 19.99% or more of the fully diluted number of shares of Common Stock outstanding at such time; provided, however, that nothing herein will require Common Stock to be sold to the extent that the Farids Group and its Affiliates, collectively, exceed the ownership limit under this Section 8.7 as the result of any share repurchase or other Company action that reduces the number of outstanding shares of Common Stock on or after the date hereof; provided, further, that (a) this Section 8.7 shall not preclude Farids or EA from privately requesting a waiver of the provisions of Section 8.7, and (b) the provisions of this Section 8.7 shall terminate and be of no further force and effect if the Company enters into a definitive agreement with respect to, or publicly announces that it plans to enter into, a transaction involving all or a controlling portion of the Company's equity securities or all or substantially all of the Company's assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise). Section 8.8 Non-Disparagement. (a) Neither the Company nor any of its Affiliates shall in any manner, directly or indirectly, in any capacity or manner, make or cause to be made, or in any way encourage any other person to make or cause to be made, any public statement or public announcement, including in any document or report filed with or furnished to the SEC or through the press, media, analysts or other persons, that constitutes an ad hominem attack on or otherwise disparages, defames or slanders the Farids Group or any of its Affiliates or any of their respective successors or current or former members, partners, officers, directors or employees (it being understood and agreed that the restrictions in this Section 8.8(a) shall not apply to any member of the Board of Directors based upon discussions solely among other members of the Board of Directors and/or management of the Company); provided, that the limitations set forth in this Section 8.8(a) shall not prevent the Company or any of its Affiliates from (i) responding to any public statement or announcement made by the Farids Group or any of its Affiliates that was made in breach of Section 8.8(b) below or (ii) if solicited by a Third Party, making objective statements that reflect the Company's view with respect to factual matters concerning specific acts or determinations of the Farids Group or any of its Affiliates (or their respective current or former representatives) occurring after the date hereof. For the avoidance of doubt, a public statement or announcement shall only be deemed to be made by the Company if such public statement or announcement is made by (X) an executive officer or a member of the Board of Directors (other than a Director Designee) or (Y) an employee or representative of the Company authorized to make such statement or announcement on behalf of the Company. 32





(b) Neither the Farids Group nor any of its Affiliates shall in any manner, directly or indirectly, in any capacity or manner, make or cause to be made, or in any way encourage any other person to make or cause to be made, any public statement or public announcement, including in any document or report filed with or furnished to the SEC or through the press, media, analysts or other persons, that constitutes an ad hominem attack on or otherwise disparages, defames or slanders the Company or any of its Affiliates or any of their respective successors or current or former members, partners, officers, directors or employees; provided, that, the limitations set forth in this Section 8.8(b) shall not prevent the Farids Group or any of its Affiliates from (i) responding to any statement made by the Company or any of its Affiliates or representatives that was made in breach of Section 8.8(a) above or (ii) if solicited by a Third Party, making objective statements that reflect the Farids Group's or any of its Affiliates' view with respect to factual matters concerning specific acts or determinations of the Company, any of its Affiliates or any current or former representatives of the Company or any of its Affiliates occurring after the date hereof. For the avoidance of doubt, a public statement or announcement shall only be deemed to be made by the Farids Group or any of its Affiliates if such public statement or announcement is made by (X) a Farids manager, director or executive officer or an EA manager, director or executive officer (Y) an employee or representative of Farids or EA authorized to make such statement or announcement on behalf of Farids or EA, as applicable. Section 8.9 Non-Solicitation. (a) Each of EA, Farids and the Company shall not, and shall cause their respective controlled Affiliates to not, either directly or indirectly solicit, hire, or contract with any of the employees of the other party or its Affiliates during the Term (as defined in the Exclusive Supplier Operating Agreement) and for one (1) year following the termination or expiration thereof; provided that this Section 8.9(a) shall not apply with respect to any such employee who employment with the other party and its Affiliates has been terminated for a period in excess of nine (9) months. (b) Notwithstanding anything to the contrary in this Agreement, the restrictions regarding solicitation in this Section 8.9 shall not be deemed to apply to media advertisements of general circulation, open job fairs, the efforts of an employment search firm or other generalized means of publicizing a job opening, such as on a website or job board which, in each case, are not targeted primarily at the employees of the other party or its Affiliates; provided that this Section 8.9(b) shall not limit the restrictions or hiring set forth in Section 8.9(a). Section 8.10 Entire Agreement. This Agreement and the other Transaction Documents constitute the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior agreements and understandings, both oral and written, between the parties and/or their Affiliates with respect to the subject matter of this Agreement. 33





Section 8.11 Effect of Headings. The Article and Section headings herein are for convenience only and shall not affect the construction hereof. Section 8.12 Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable Law, such provision shall be deemed to be excluded from this Agreement and the balance of this Agreement shall be interpreted as if such provision were so excluded and shall be enforced in accordance with its terms to the maximum extent permitted by law. Section 8.13 Counterparts; Third Party Beneficiaries. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures were upon the same instrument. Facsimile and electronic (.PDF) signatures shall be sufficient to execute this Agreement. Except for Section 6.8 with respect to the underwriters of Registrable Securities, no provision of this Agreement shall confer upon any person other than the parties hereto any rights or remedies hereunder. Section 8.14 Survival. The representations, warranties, agreements and covenants contained herein shall survive the Closing. Section 8.15 Remedies. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms. It is accordingly agreed that the parties shall be entitled to seek specific performance of the terms hereof, this being in addition to any other remedies to which they are entitled at law or equity. In the event of any dispute between the parties concerning the terms and provisions of this Agreement, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys' fees. [Remainder of this page intentionally left blank] 34





IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed as of the date first written above. ROCKY MOUNTAIN CHOCOLATE FACTORY, INC. By: /s/ Bryan J. Merryman Name: Bryan J. Merryman Title: Chief Executive Officer and Chief Financial Officer FARIDS & CO. LLC By: /s/ Tariq Farid Name: Tariq Farid Title: Chief Executive Officer EDIBLE ARRANGEMENTS, LLC By: /s/ Tariq Farid Name: Tariq Farid Title: Chief Executive Officer [Signature Page to Strategic Alliance Agreement]





EXHIBIT A FORM OF JOINDER AGREEMENT This JOINDER AGREEMENT (this Joinder Agreement) is executed pursuant to the terms of the Strategic Alliance Agreement, dated as of December 20, 2019, by and among Farids & Co. LLC, a Delaware limited liability company (Farids), Edible Arrangements, LLC, a Delaware limited liability company, and Rocky Mountain Chocolate Factory, Inc., a Delaware corporation (the Company), a copy of which is attached hereto and is incorporated herein by reference (the Agreement), by the undersigned (the Farids Transferee). Capitalized terms used but not defined herein have the meanings set forth in the Agreement. By execution and delivery of this Joinder Agreement, the Farids Transferee agrees as follows: SECTION 1. Acknowledgment. The Farids Transferee acknowledges that it has acquired Purchased Shares from a member of the Farids Group pursuant to a Permitted Transfer. SECTION 2. Agreement. The Farids Transferee (a) agrees that the Purchased Shares it owns shall be bound by and subject to the terms of the Agreement to the same extent as if such Farids Transferee were a member of the Farids Group, (b) hereby adopts the Agreement with the same force and effect as if it were originally a member of the Farids Group and (c) shall constitute a member of the Farids Group under the Agreement. SECTION 3. Notice. Any notice required to be provided by the Agreement shall be given to the Farids Transferee at the address of Farids Group listed in the Agreement. SECTION 4. Governing Law. This Joinder Agreement and the rights of the parties hereto shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed therein. Executed and dated this day of . Farids Transferee: [INSERT NAME] By: [Title] Acknowledged and Agreed to by ROCKY MOUNTAIN CHOCOLATE FACTORY, INC. By: [Title] A-1





EXHIBIT B EXCLUSIVE SUPPLIER OPERATING AGREEMENT [Attached] B-1





EXHIBIT C WARRANT [Attached] C-1





EXHIBIT D INDEMNIFICATION AGREEMENT [Attached] D-1





EXHIBIT E AMENDMENT E-1
answer:
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?


question:
Exhibit 10.24    [***] Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.   EXECUTION VERSION   STRATEGIC ALLIANCE AGREEMENT

  THIS STRATEGIC ALLIANCE AGREEMENT (Agreement) is made and entered into as of November 6, 2016 (the Effective Date) by and between Dialog Semiconductor (UK) Ltd., a corporation organized under the laws of England and Wales, having its principal office at 100 Longwater Avenue, Green Park, Reading, RG2 6GP, United Kingdom (DIALOG) and Energous Corporation, a Delaware corporation, having its principal office at 3590 North First Street, Suite 210, San Jose, CA 95134 (ENERGOUS).   WHEREAS DIALOG is a supplier of mixed-signal semiconductor products;   WHEREAS ENERGOUS is a supplier of uncoupled wirefree charging systems, including antennas, semiconductors, firmware, software, algorithms, and sensors;   WHEREAS concurrently with their execution of this Agreement, DIALOG and ENERGOUS are entering into a separate Securities Purchase Agreement, pursuant to which DIALOG will make an investment in ENERGOUS, and ENERGOUS will issue to DIALOG shares of its common stock and a warrant to purchase its common stock on the terms set forth therein.   WHEREAS DIALOG and ENERGOUS desire to enter into a strategic relationship to distribute to the marketplace certain ENERGOUS products and technology and to potentially collaborate on further initiatives pursuant to the terms and conditions of this Agreement.   NOW, THEREFORE, in consideration for the premises and mutual covenants contained herein, DIALOG and ENERGOUS hereby agree as follows:   1. DEFINITIONS.   All capitalized terms used in this Agreement will have the meaning set out below, or if not defined below, the meaning as defined elsewhere in the Agreement.   1.1 Affiliate means any person or entity that controls, is controlled by or is under common control with the specified person or entity, but only so long as such control exists. The term control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through ownership of voting securities, by contract or otherwise.   1.2  Approved Production Specifications means those materials, processes and workmanship specifications of Manufacturing Subcontractors as approved by ENERGOUS for the manufacture and production of the Products.   1.3 Change of Control means any transaction or series of transactions that results in (i) the consolidation or merger of the specified party (Target) into or with any other corporation or corporations, (ii) the sale, conveyance or disposition of all or substantially all of the assets of the Target, (iii) the transfer of more than fifty percent (50%) of the voting power of the Target to any entity or entities not controlled by the Target, or (iv) any similar form of acquisition or any liquidation, dissolution or winding up of the Target or other transaction that results in the discontinuance of the Target's business; provided, however, that Change of Control will not include any transaction or series of transactions entered into primarily for equity financing purposes (including, without limitation, any private equity investment or any public offering of securities).









  1.4  Deposit Materials means all chip level design databases, circuit schematics, test and characterization programs and associated documentation reasonably required to have Products manufactured, or to allow design bugs or Epidemic Defects to be fixed in the Product.   1.5 Design-In Phase means the phase in the sales cycle with a prospective customer for a Product that follows the customer's decision to move forward with the potential Product, during which chip samples are delivered to customer and the parties work together to design the evaluation board for in-system evaluation.   1.6 Documentation means all information that is necessary or useful to support DIALOG's authorized manufacture, testing, sale and support of the Products, including but not limited to Product Specifications, data sheets, application notes, application board gerber files/BOM, sales and marketing collateral, Product errata, test reports, characterization reports, software (e.g., firmware, GUI), test plans and yield data in connection with the manufacture and sale of Products, Approved Production Specifications, test and characterization programs and associated documentation reasonably required to have Products manufactured, assembled and tested, designs of all Tooling and all other items reasonably required for the manufacture of the Products.   1.7 Epidemic Defects means material defects of any Product resulting from a common root cause solely attributable to the Product Specifications or Approved Production Specifications and which results in returns (in accordance with the returns procedure mutually agreed between the parties in the Commercialization Plan) of more than [***] percent ([***]%) of the quantity of such Product manufactured in any [***] day period. Any number of material defects affecting any number of Products which result from a single common root cause or combination of causes and result in returns of more than [***] ([***]%) of such Products manufactured in any [***] day period will be treated as the occurrence of a single Epidemic Defect for purposes of this Agreement.   1.8 Insolvency Event means (a) without a successor, the specified party fails to function as a going concern or to operate in the ordinary course, or (b) other than in the case when the specified party is a debtor-in-possession and continuing to fulfill all its obligations under this Agreement, a receiver or trustee in bankruptcy is appointed for such party or its property, or such party makes a general assignment for the benefit of its creditors, or such party commences, or has commenced against it, proceedings under any bankruptcy, insolvency or debtor's relief law, in each case which proceedings are not dismissed within ninety (90) days.   1.9 Intellectual Property Rights means any and all Patent Rights, copyright rights, Marks rights (including all associated goodwill), mask work rights, trade secret rights and all other intellectual and industrial property rights of any sort throughout the world (including any application therefor).     * Confidential Treatment Requested

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  1.10  Invention means any idea, concept, discovery, invention, development, technology, work of authorship, trade secret, software, firmware, library, component, tool, mask work, process, method, technique, know-how, show-how, data, plan, formula, device, apparatus, specification, design, documentation or other material or information, tangible or intangible, whether or not it may be patented, copyrighted or otherwise protected (including all versions, modifications, enhancements and derivative works thereof).   1.11 Manufacturing Subcontractors means (a) [***] and/or its Affiliate that is the wafer foundry for the Products ([***]), (b) [***] and/or its Affiliate that is responsible for the assembly, packaging and testing of the Products, and (c) and other third party contractors DIALOG or ENERGOUS use, or may from time to time use, for the manufacturing, assembly, testing, or packaging of the Licensed Products or Licensed Product components.   1.12 Marks means trademarks, service marks, trade dress and trade names.   1.13 Mask Set means the mask set for fabrication of wafers at a foundry supplier.   1.14 Mass Production Qualified Product means a fully qualified Product which has completed 500 hour high temperature over lifetime (HTOL) testing and has been shipped in excess of [***] units for purposes of incorporation in customer products.   1.15 MCM means a multichip module, being a single package that includes multiple integrated circuit dies, including a Product die.   1.16 Net Sales means the invoiced amounts for the Sale of Products less: (a) amounts credited for return of any such Products; (b) amounts separately stated with respect to shipment of such Products for insurance, handling, duty, freight, and taxes; and (c) any discounts, credits or rebates in the relevant royalty or service fee period.   1.17 New Product means a product developed by or on behalf of ENERGOUS after the Effective Date that is not a Product Update; provided, however, that New Products exclude any product developed by a successor or acquirer of ENERGOUS.   1.18  Patent means any United States or foreign patent or patent application, including any provisional application, continuation, continuation-in-part, divisional, registration, confirmation, revalidation, reissue, PCT application, patent term extension, supplementary protection certificate, and utility model, as well as all foreign counterparts of any of the foregoing, and related extensions or restorations of terms thereof.   1.19 Patent Rights means rights under any Patent.   1.20 Person a human being or group of human beings, a company, corporation, a partnership or other legal entity (artificial or juristic person) recognized by law as having rights and duties.     * Confidential Treatment Requested

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  1.21 Products means the ENERGOUS products set forth in  Exhibit A, as such Exhibit may be amended from time to time by mutual agreement between the parties, that have been released by ENERGOUS to production, including all Product Updates, which will be deemed to have been added to Exhibit A automatically, without any further action required by the parties, immediately following the release to production date.   1.22 Product Die means the silicon die incorporated within Products.   1.23 Product IP means (a) all Intellectual Property Rights in and to the Products, including all Product Updates, (b) any other Inventions and work products created or developed in connection with research and development or manufacturing efforts relating to the Products, including all Intellectual Property Rights therein and (c) all Intellectual Property Rights in and to the Mask Sets and Tooling, in each of the foregoing cases, that are owned or controlled by ENERGOUS, its Affiliates or any successor or assign.   1.24 Product Specifications means ENERGOUS' written technical specifications for the Products as referenced in datasheets and related documentation such as errata sheets. All Product Specifications are subject to change with at least one (1) months prior written notice to DIALOG, provided that with respect to any warranty for Products covered by this Agreement, the Product Specification in effect at the time of shipment of the relevant Product will apply for warranty purposes notwithstanding any subsequent change to the Product Specifications as provided herein.   1.25 Product Updates means any updates, improvements and other modifications to the Products made by or for ENERGOUS, including, without limitation: (a) any updates or modifications to the software (DSP code, firmware, GUI (graphical user interface) code); (b) modifications of silicon, including, without limitation; such modifications made solely for cost reduction purposes, and including only metal layer as well as all layer mask changes; (c) modifications which increase the distance over which wireless power is transmitted or received, subject to the limitations set out in Exhibit A; (d) modifications which increase the amount of power which is transmitted or received; (e) modifications to improve functionality or efficiency or add or improve features; and (f) modifications required to attain regulatory approvals, including, but not limited to, FCC approval; provided, however, that Product Updates will only include any of the foregoing developed by an acquirer or successor of ENERGOUS for a period of [***] after a Change of Control of ENERGOUS, and provided further that any Products incorporating Product Updates will be subject to separate terms and conditions to be agreed in good faith by the Parties, which terms and conditions will be no less favourable to DIALOG than those with respect to the Product to which the Product Update corresponds.   1.26 Sale, Sell or Sold mean the sale, transfer, exchange or other disposition of Products, by DIALOG or any of its Affiliates to any customer or other third party, directly or indirectly through one or more tiers of distribution, for consideration that is recognized as revenue by DIALOG or its Affiliates according to applicable generally accepted accounting principles.   1.27 Semiconductor Supplier means any Person, other than DIALOG or its Affiliates, which primarily, or in its ordinary course of business, sells or distributes integrated circuits in packaged, die, multichip module or similar form.   * Confidential Treatment Requested

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  1.28 Term means the Initial Term and any and all Renewal Term(s) as set forth in Section 15.1 hereof.   1.29 Third Party IP means Intellectual Property Rights licensed from a third party relating to the Products.   1.30 Tooling means the physical Mask Sets, packaging fixtures, test fixtures, test programs, processes, software source code and any other physical tooling or program source code required for the manufacture, packaging, assembly and testing of the Products.   1.31 Uncoupled Power Transfer Technology means    a family of wire-free technology  defined by the AirFuel Alliance that provides power to devices at a distance, and that currently includes (i) RF, (ii) ultrasonic transduction, and (iii) Laser power beaming. Notwithstanding the foregoing, the meaning of Uncoupled Power Transfer Technology excludes technology which functions primarily for data transmission or direct- current-to-direct-current (DC-to-DC) power conversion.   2. LICENSE.   2.1 License Grant. Subject to the restrictions set out in Section 2.2, ENERGOUS hereby grants to DIALOG a non-exclusive (subject to Section 2.5), irrevocable, worldwide, sub-licensable (solely in accordance with Section 2.4), royalty-bearing license during the Term under all Product IP to:   (a) repackage or have repackaged the Product Die into various package formats or layouts, and to integrate the Product Die into MCMs, which may incorporate DIALOG or third party intellectual property (such repackaged Product Die, MCMs and Products, are individually and/or collectively referred to as the Licensed Products);   (b) have the Licensed Products manufactured, tested and packaged by Manufacturing Subcontractors;   (c) Sell, offer for Sale, import, export and support the Licensed Products, including without limitation, providing system design, troubleshooting and failure analysis support for DIALOG's customers and their customers;   (d) use and modify the Tooling and Documentation for the purposes of paragraphs (a) to (d) of this Section 2.1.   2.2 Excluded Applications. Until the earlier of (i) termination of ENERGOUS' exclusivity obligations to the Key Customer set forth in Exhibit F (the Key Customer) existing as of the Effective Date with respect to the following applications, or (ii) [***] that incorporates ENERGOUS wireless charging technology, or (iii) [***] and subject to the exceptions set out in Section 2.3, DIALOG will not be permitted to Sell Licensed Products for use in the following applications (the Excluded Applications):   (a) [***];   * Confidential Treatment Requested

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  (b) [***];   (c) [***];   (d) [***]; and   (e) [***] designed for use with any of the applications in paragraphs (a) to (d) of this Section 2.2.   For the avoidance of doubt, DIALOG will be permitted to Sell Licensed Products for use in any or all of the Excluded Applications (A) at any time on or after [***] or, if earlier, (B) [***] that incorporates ENERGOUS wireless charging technology, or (C) upon the termination of ENERGOUS' exclusivity obligations to the Key Customer existing as of the Effective Date with respect to the above applications.   2.3 Exceptions to Excluded Applications. The following applications are exceptions to and excluded from the Excluded Applications (the Permitted Applications):   (a) [***];   (b) [***];   (c) [***];   (d) [***];   (e) [***];   (f) [***];   (g) [***];   (h) [***];   (i) [***]; and   (j) [***].   The fact that a [***] has [***] does not automatically preclude such device from falling under paragraphs (b), (c) and (d) of this Section 2.3   2.4  Sublicenses. DIALOG may sublicense the foregoing license rights to any of its Affiliates. DIALOG will be responsible for the observance and performance by all such Affiliates of all of DIALOG's obligations pursuant to this Agreement. DIALOG may sublicense the foregoing license rights to Manufacturing Subcontractors solely to the extent necessary and appropriate for them to manufacture, assemble, test and provide support for the Products. DIALOG may not sublicense the foregoing license rights to any other third party without ENERGOUS' prior written consent.   * Confidential Treatment Requested

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  2.5 Exclusivity.   (a)  Subject to paragraph (b) of this Section 2.5, ENERGOUS will not, and will not enable any Semiconductor Supplier, to manufacture, have manufactured, offer for sale, sell, import or export the Products or Product Die in commercial volumes, except a Semiconductor Supplier to the Key Customer for use in the Excluded Applications.   (b) ENERGOUS will use its diligent, good faith efforts to promote DIALOG as the preferred supplier of Products and Product Die. However, ENERGOUS is allowed to engage with a Semiconductor Supplier to supply comparable products or product die to a customer if either (i) the customer which has not been engaged with DIALOG with respect to such product or product die notifies ENERGOUS or DIALOG in writing by an authorized officer of the customer that it does not want to use DIALOG or a DIALOG Affiliate as a supplier of such product or product die; or (ii) if DIALOG has been engaged with the customer, the customer notifies ENERGOUS or DIALOG in writing prior to commencement of the Design-In Phase that it does not want to use DIALOG or a DIALOG Affiliate as a supplier of such product or product die. For clarity, ENERGOUS shall not intentionally supply Products, Product Die or comparable products or product die to customers directly or through distribution channels.   2.6 Branding.   (a) Products Sold by DIALOG or its Affiliates may be branded as DIALOG products. All sales and marketing collateral, software tools and material for promotional activities relating to the Products will utilize ENERGOUS branding in a prominent basis as an equivalent partner with respect to such Products.   (b) To the extent the parties engage in any co-branding activities, then, subject to the terms and conditions of this Agreement and during the Term, each party (in such capacity, Licensor) hereby grants to the other party (in such capacity, Licensee) a non-exclusive, non- transferable, worldwide right and license (without the right to sublicense), under Licensor's Intellectual Property Rights in Licensor's Marks, to use those Marks of Licensor set forth in  Exhibit D solely in connection with the marketing, sale and distribution of such co-branded Products in accordance with this Agreement.   (c) Use of Licensor's Marks will be subject to the following terms and conditions: (i) all goodwill generated by use of Licensor's Marks by Licensee will inure to the benefit of Licensor; (ii) Licensee will use Licensor's Marks only in such forms and with such graphics as authorized by Licensor; and (iii) Licensee will identify Licensor's Marks as being owned by Licensor and will (A) cause the symbol ® to appear adjacent to and slightly above any registered Licensor Mark, or (B) alternatively, for any Licensor Marks that are not registered, the symbol TM or SM, as applicable.   2.7 No Other Rights. Except for the rights and licenses expressly granted in this Agreement, no other right is granted, no other use is permitted and all other rights are expressly reserved.

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  3. SOURCING.   3.1 Product Manufacture. Concurrent with or before execution of this Agreement, and substantially in the form attached as Exhibit C, ENERGOUS will provide written authorization to its Manufacturing Subcontractors to confirm DIALOG's and, if applicable, DIALOG's Affiliates' rights to procure the Licensed Products and related services directly from such Manufacturing Subcontractors utilizing ENERGOUS' Tooling and any associated manufacturing resources. DIALOG and its sublicensed Affiliates may directly contract with the Manufacturing Subcontractors for the manufacture and supply of Licensed Products under terms and conditions that DIALOG or such Affiliates may directly negotiate with such third parties.   3.2 Additional Manufacturing Subcontractors. DIALOG at its sole discretion may qualify and establish an alternative source to some or all of ENERGOUS' Manufacturing Subcontractors for the manufacturing of the Licensed Products and ENERGOUS will provide its written authorization thereof if requested by DIALOG.   3.3  Tooling. Subject to ENERGOUS' rights in the Product IP and any Third Party IP (including, without limitation, that of any Manufacturing Subcontractors), each party will own all right, title and interest in the physical Tooling procured or generated by that party for the manufacturing, testing and packaging of the Licensed Products. For the avoidance of doubt, as between the parties, ENERGOUS will also continue to own all right, title and interest in and to the firmware, DSP code and GUI software embedded in the Products, including all Intellectual Property Rights embodied therein. Upon the termination of DIALOG's right to manufacture the Licensed Products following any expiration or termination of the Agreement or any Wind Down Period or Continuing Obligation period, as applicable, then all right, title and interest in the Tooling will automatically transfer to ENERGOUS subject to any Third Party IP, and DIALOG will, at ENERGOUS' option, either sell any Tooling in its possession to ENERGOUS at cost or destroy the Tooling and certify in writing as to same.   4. PRODUCT COMMERCIALIZATION.   4.1 Commercialization Plan.   (a) Exhibit E hereto sets out the plan for the commercialization of the Licensed Products (the Commercialization Plan). The Commercialization Plan sets forth the parties' respective rights and obligations with respect to commercial and technical activities to be performed to maximize potential Sales of Licensed Products. The Commercialization Plan will be reviewed and (if necessary) updated by the parties on a quarterly basis during the Term.   (b) Each party will appoint (and notify the other party of the name of) a member of their management team who will serve as that party's primary contact for all matters related to this Agreement (each, a Liaison), including resolution of issues that may arise under this Agreement. Each party may replace its Liaison at any time by notice in writing to the other party.   (c) The Commercialization Plan includes a go-to-market plan. ENERGOUS will provide commercially reasonable sales training, material and support to DIALOG's global application, sales and marketing teams and customers, including the support set out in Section 4.3.

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  (d) ENERGOUS will also support DIALOG with an operations and quality plan, which will set forth information relating to quality matters, including, but not limited to, testing, yield management, RMA process, failure analysis/corrective action procedure, ECN/PCN process and detailed agreement on mutual rights and responsibilities with respect to any quality issues or warranty claims (hereinafter Quality Plan). Both parties will work in good faith to finalize and implement the Quality Plan within 90 days after the Effective Date of this Agreement. DIALOG will be responsible for its own frontline quality function and corrective actions, with technical input from ENERGOUS as required.   (e) The parties may promote the relationship with marketing initiatives and also agree to engage in joint marketing communication activities related to the relationship described in this Agreement or to the promotion of the Licensed Products, as set forth in the Commercialization Plan or otherwise mutually agreed between the parties from time to time.   4.2 Commercialization Meetings. The parties will meet regularly, but at least once each month during the Term, either in person or by telephone, video or internet conference call, to share technical and commercial information as reasonably required to facilitate the parties' exercise of their respective rights and performance of their respective obligations under this Agreement. The information shared by the parties will include, but is not limited to (a) market and competitive dynamic updates, (b) activities and progress updates at DIALOG's customers, (c) technical review and feedback from customers, (d) non-binding 12 month rolling Sales and Royalty and Service Fee forecasts for the Licensed Products, (e) initiatives to boost sales potential for the Licensed Products. Customer information shared will be within the limits allowed by any non-disclosure agreements DIALOG may have entered into with such customers.   4.3 Technical Support. ENERGOUS will support DIALOG's or its Affiliates' engineers and, in some cases and at DIALOG's request, the customer directly in providing standard design-in support (including antenna design support) for customers' products. If the customer requires unique or custom engineering services (i.e., support and services not limited to those with general application to Product customers), then ENERGOUS will contract directly with such customer for the provision of such services. ENERGOUS will provide DIALOG with any and all information that is necessary or useful to support its authorized manufacture, testing, marketing, Sale, troubleshooting, compatibility analysis, performance tuning, failure analysis, and other support of the Licensed Products, including the Documentation and any updates thereto or revisions thereof which are reasonably necessary or appropriate to provide technical support for the Products to DIALOG customers. ENERGOUS receives the Service Fee for providing the support described in this Section 4.3 to DIALOG and its customers during the Term. In the event the Technical Support provided by ENERGOUS falls below a mutually-agreed upon service level that is common to the semiconductor industry or reasonably requested by DIALOG's customers, and after failure by ENERGOUS to address such deficiency within a twenty (20) day notice period, DIALOG may suspend the payment of Service Fees until such service level is provided. Furthermore, in the event ENERGOUS fails to meet its obligations as set forth in the Quality Plan, and after failure by ENERGOUS to address such deficiency within a thirty (30) day notice period, DIALOG may suspend the payment of Service Fees until such obligations are met.

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  5. PRODUCT DEVELOPMENT AND PRODUCT UPDATES.   ENERGOUS will have control and authority over the design and development of the Products, including without limitation, developing and implementing all Product Updates. ENERGOUS reserves the right to implement Product Updates at any time in its sole discretion. The parties will consult each other on the perceived product needs of the market and DIALOG's customers and how best to respond to such needs. DIALOG may suggest Product Updates to ENERGOUS provided, but all the development of Product Updates will be at ENERGOUS' sole discretion. ENERGOUS will share its relevant product roadmaps from time to time to maximize collaboration opportunities.   6. INTELLECTUAL PROPERTY OWNERSHIP.   6.1 Product IP. ENERGOUS retains right, title and interest in and to the Product IP, ENERGOUS' Marks and ENERGOUS' Confidential Information, including all Intellectual Property Rights embodied therein. No transfer or grant is made hereunder by ENERGOUS of any of these rights or any of its other rights, whether by implication, estoppel or otherwise, other than the limited rights and licenses expressly granted by ENERGOUS in this Agreement, and all such other rights are hereby reserved.   6.2 DIALOG Intellectual Property. DIALOG retains rights, title and interest in and to DIALOG's Marks and DIALOG's Confidential Information, including all Intellectual Property Rights embodied therein. No transfer or grant is made hereunder by DIALOG of any of these rights or any of its other rights, whether by implication, estoppel or otherwise, other than the limited rights and licenses expressly granted by DIALOG in this Agreement and all such other rights are hereby reserved.   7. PRODUCT SALES.   7.1 Sales. Subject to the terms and conditions of this Agreement, and except as set forth in the Commercialization Plan or otherwise agreed in writing between the parties, DIALOG will market and Sell the Licensed Products as authorized under this Agreement. DIALOG will independently manage and process its own forecasting, operations and order management.   7.2 Discontinuation of Sale of Products. If DIALOG decides to discontinue Sales of any Product, it will notify ENERGOUS at least [***] prior to such discontinuance, and following such notification, the exclusivity rights, if any, associated with that Product will cease; provided, however, this provision will not apply in the event that DIALOG continues Sales of Product Updates, repackaged Product Dies or MCMs.   7.3 Supply of Products to ENERGOUS. DIALOG will provide 1000 samples of each Product free of charge to ENERGOUS for the purposes of evaluation and demonstration. For additional volumes required by ENERGOUS, DIALOG will sell to ENERGOUS on a reasonable cost plus basis for the purposes of evaluation and demonstration. These samples are provided as is, are not intended for resale by ENERGOUS, and no indemnification or other warranties from DIALOG will apply.   * Confidential Treatment Requested

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  8. OTHER PRODUCTS.   8.1 New Products. In the event that ENERGOUS develops New Product, ENERGOUS will provide DIALOG with written notice describing the New Product before marketing, selling or distributing the New Product with or to any third party. Upon receipt of such notice, DIALOG will have [***] to notify ENERGOUS in writing that it desires to add such New Product as Product under this Agreement. If DIALOG provides such a notice, for a period of [***] following ENERGOUS' receipt of such notice, ENERGOUS and DIALOG will negotiate in good faith the terms pursuant to which such New Product will be added as a Product to this Agreement. ENERGOUS may not negotiate with any third party the rights to market, sell or distribute any New Product until the earliest to occur of the following (a) DIALOG does not provide ENERGOUS with notice that it desires to add such New Product to this Agreement within the above-described [***] period, (b) ENERGOUS and DIALOG do not reach mutually agreeable terms for adding such New Product to this Agreement during the [***] negotiation period or (c) DIALOG provides ENERGOUS with written notice that it does not wish to negotiate with respect to such New Product. For clarity, after any of the events described in the foregoing subsections (a), (b) or (c) occurs, the New Product will not be covered under this Agreement, and ENERGOUS will be free to manufacture, market, sell, distribute and otherwise exploit such New Product as it deems fit in its sole discretion, including in collaboration with or through one or more third parties.   8.2 No Competing Products.   (a) Until expiration or earlier termination of the Agreement, DIALOG agrees that it and its Affiliates will not, without ENERGOUS' written approval, intentionally sell, distribute or work with any third party to develop products incorporating any Uncoupled Power Transfer Technology other than Licensed Products; provided, however, that DIALOG shall not be under any such restrictions in relation to services or products it provides to the Key Customer in the event the Key Customer terminates its agreement with ENERGOUS.   (b) In the event that ENERGOUS does not receive Federal Communications Commission approval of any Licensed Product for power transmission [***] by the [***], (i) ENERGOUS may provide written notice to DIALOG which references this Section 8.2(b) and indicates ENERGOUS' intention to enable one or more Semiconductor Suppliers to supply Products for [***]; and (ii) DIALOG may provide written notice to ENERGOUS which references this Section 8.2(b) and indicates DIALOG's intention to sell, distribute or work with one or more third parties to develop products incorporating Uncoupled Power Transfer Technology for [***]. [***] following the date such notice is given pursuant to Section 20.1, the restrictions in Section 8.2(a) shall no longer apply to DIALOG for Uncoupled Power Transfer Technology in [***] and the restrictions relating to enabling a Semiconductor Supplier in Section 2.5(a) shall no longer apply to ENERGOUS for Products or Product Die in [***].   (c) In the event that ENERGOUS does not receive Federal Communications Commission approval of any Licensed Product for power transmission in [***] by the [***], (i) ENERGOUS may provide written notice to DIALOG which references this Section 8.2(c) and indicates ENERGOUS' intention to enable one or more Semiconductor Suppliers to supply Products for [***]; and (ii) DIALOG may provide written notice to ENERGOUS which references this Section 8.2(c) and indicates DIALOG's intention to sell, distribute or work with one or more third parties to develop products incorporating Uncoupled Power Transfer Technology for [***]. [***] following the date such notice is given pursuant to Section 20.1, the restrictions in Section 8.2(a) shall no longer apply to DIALOG for Uncoupled Power Transfer Technology in [***] and the restrictions relating to enabling a Semiconductor Supplier in Section 2.5(a) shall no longer apply to ENERGOUS for Products or Product Die in [***].   * Confidential Treatment Requested

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  9. ROYALTIES AND SERVICE FEES.   9.1 Royalties. DIALOG will pay ENERGOUS the Royalties set forth in  Exhibit B. For clarity, DIALOG will be responsible for paying to ENERGOUS any Royalties payable hereunder as a result of its Affiliates' Licensed Product Sales.   9.2 Service Fee. Subject to Section 4.3, DIALOG will pay ENERGOUS the Service Fees set forth in Exhibit B. For clarity, subject to Section 4.3, DIALOG will be responsible for paying to ENERGOUS any Service Fees payable hereunder for services provided by ENERGOUS hereunder to DIALOG's Affiliates or any of DIALOG's or its Affiliates' customers.   9.3 Payment. Payments of Royalties and Service Fees will be due on a calendar quarterly basis, within [***] days after the end of the calendar quarter in which the applicable Licensed Products were Sold or services were rendered. From the date a payment is due, unless otherwise agreed, any late payment will accrue a late payment fee of [***] per month, or the highest interest rate permitted by law, whichever is less.   9.4 Reports. Each payment made hereunder will be accompanied by a report detailing (a) the total number of units, on a product-by- product basis, of the Licensed Products Sold during the previous calendar quarter, (b) DIALOG's and its Affiliates' Net Sales attributable to such Licensed Product units during such calendar quarter, and (c) reasonable details regarding the calculation of the quarterly Royalty payment and Service Fee. Such information will be maintained in strict confidence by ENERGOUS under Section 10 of this Agreement.   9.5 Books. With respect to its exercise of the rights and licenses granted in, and payment obligations under, this Agreement, DIALOG and its Affiliates will keep accurate books and other records, including but not limited to supporting documentation for the Royalties and Service Fees paid hereunder (the Records). These Records will be maintained for a period of at least three (3) years from the date of the related payment (Record Retention Period), notwithstanding any termination of expiration of this Agreement.   9.6 Audit Rights. During the Record Retention Period, ENERGOUS may appoint a mutually agreed independent, internationally recognized third-party certified auditor who will have the right to inspect and copy the Records upon reasonable prior notice, and DIALOG will (and will cause its Affiliates to) allow necessary access including, as applicable, to its premises where such Records are located. ENERGOUS may exercise such right to this independent-third party audit no more than one time per calendar year and each such audit will be conducted during normal business hours. Such audit may also not interfere with DIALOG's or its Affliates' quarterly closing of its books. In the event that such audit reveals an underpayment of Royalties or Service Fees owed by DIALOG, DIALOG will promptly pay ENERGOUS the amount of the underpayment. If such underpayment is in excess of [***] of the Royalties or Service Fee due for the period audited, DIALOG will also reimburse ENERGOUS for its reasonable, out-of-pocket cost of such audit. In the event that such audit reveals an overpayment of Royalties or Service Fees owed by DIALOG, ENERGOUS will promptly pay DIALOG the amount of the overpayment.   * Confidential Treatment Requested

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  9.7 Taxes. Each party will be responsible to collect, bear and pay any and all taxes levied or based upon the party's sale of the Products, Product Die or Licensed Products, including, all sales, use, value added, withholding or similar taxes. In the event that the government of a country imposes any income taxes on payments made by a party to the other hereunder and requires a party to withhold such tax from such payments, such party may deduct such tax from such payments. Each party will be responsible for its own banking costs relating to the receipt of payments of Royalties and Service Fees and any other monies payable to it in connection with this Agreement.   9.8 Payment Currency. All payments due under this Agreement will be payable in U.S. Dollars. With respect to Net Sales invoiced in a currency other than U.S. Dollars, the Net Sales will be expressed in the domestic currency of the entity making the Sale, together with the U.S. Dollar equivalent, calculated using the conversion rate existing in the United States (as reported in the Wall Street Journal) on the last working day of each month of the calendar quarter in which the Net Sales were made. Such payments will be without deduction of exchange, collection or other charges.   10. CONFIDENTIALITY.   10.1 Scope. The term Confidential Information means all financial, business and technical information disclosed by or on behalf of a party in relation to this Agreement (whether tangible or intangible, and including all copies, analyses and derivatives thereof), that is marked or otherwise identified as proprietary or confidential at the time of disclosure, or which by its nature would be understood by a reasonable person to be proprietary or confidential, including all copies, abstracts, summaries, analyses and derivatives thereof. Confidential Information does not include information the receiving party can demonstrate (a) was rightfully furnished to it without restriction by a third party without breach of any obligation to the disclosing party, (b) is generally available to the public without breach of this Agreement, (c) was available to or already in the possession or control of the receiving party on a non-confidential basis before receipt from the disclosing party or (d) is independently developed by it or its employees without reliance on such information. Information associated with DIALOG's quarterly Royalty or Service Fee disclosures is Confidential Information of DIALOG.   10.2 Non-Disclosure. The receiving party agrees (a) not to copy or use the disclosing party's Confidential Information except and only for the purposes contemplated by this Agreement, (b) to maintain it as confidential, and exercise reasonable precautions to prevent unauthorized access, use and disclosure, (c) not to disclose it to any third party other than the receiving party's employees and contractors who have a need to know for the permitted purpose and who are bound by obligations that are at least as protective as the restrictions in this Agreement and (d) not to export or re-export in violation of U.S. or other export control laws or regulations any such Confidential Information or product thereof. Each party will bear the responsibility for any breach of this Section 10 by its and its Affiliates' employees and contractors. Upon any termination of this Agreement or, in the event of any Wind Down Period or Continuing Obligation period, upon the expiration of such period, and within fifteen (15) days after request by the disclosing party, each receiving party will return the Confidential Information of the other or destroy such Confidential Information and all copies of it and all information, records and materials developed therefrom, except that the recipient may retain one copy for archival purposes to ensure compliance with the provisions of this Agreement, and nothing contained herein will require the erasure, deletion, alteration or destruction of any Confidential Information required to be retained for legal or regulatory purposes or stored on back-up tapes or other back-up media or archiving systems made in the ordinary course of business, subject in each case to the confidentiality obligations set forth herein. Each party may only disclose the general nature, but not the specific terms, of this Agreement without the prior consent of the other party; provided, however, either party may provide a copy of this Agreement or otherwise disclose its terms on a confidential basis in connection with any legal or regulatory requirement, financing transaction or due diligence inquiry. For clarity, in the event that use, disclosure or retention of any Confidential Information is required in order for DIALOG to exercise the license granted in Section 2, this Section 10 will not be deemed to prevent such use, disclosure or retention.

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  10.3 Required Disclosure. Nothing herein will prevent a receiving party from disclosing all or part of the other's Confidential Information as necessary pursuant to court order, the lawful requirement of a governmental agency or when disclosure is required by operation of law (including disclosures pursuant to applicable securities laws or regulations thereunder); provided, that prior to any such disclosure, the receiving party will use reasonable efforts to (a) promptly notify the disclosing party in writing of such requirement to disclose, and (b) cooperate fully with the disclosing party in protecting against or minimizing any such disclosure or obtaining a protective order.   11. REPRESENTATIONS AND WARRANTIES; DISCLAIMERS.   11.1 Mutual Representations and Warranties. ENERGOUS and DIALOG hereby each represent and warrant to the other that as of the Effective Date:   (a) it is a duly and validly organized and existing corporation in good standing under the laws of the state or country of its incorporation, as applicable, and that it is legally qualified to do business in each jurisdiction in which this Agreement may be performed and the performance of its activities hereunder requires such qualification;   (b)  the performance of this Agreement and the consummation of the transactions contemplated herein will not result in any breach or violation of any terms or provisions of, or constitute a default under, its certificate of incorporation or by-laws or other organizational documents, or any material agreement or instrument to which it is a party, by which it is bound, or to which any of its property is subject;   (c) all requisite corporate action has been taken for the due authorization, execution, delivery and performance of this Agreement by it, and this Agreement constitutes a legally binding obligation, enforceable against such party in accordance with its terms, except insofar as enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting the rights of creditors generally; and

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  (d) it is not a party to any litigation relating to, or that could reasonably be expected to affect, its ability to perform its obligations under this Agreement.   11.2 Product Warranty.   (a)  ENERGOUS warrants that (i) when manufactured in accordance with the Approved Production Specifications, and as implemented in a suitable circuit application in accordance with the Product Specifications, the Products and Product Die will conform to the Product Specifications and will be free from defects that could have been avoided in their design; (ii) the Products, any constituent parts or functionality thereof, the Documentation and the Deposit Materials do not infringe any third party's Intellectual Property Rights; (iii) it did not misappropriate any third party's trade secrets in the development of the Products, any constituent parts or functionality thereof, the Documentation or the Deposit Materials; and (iv) when delivered (including any software updates if any), no Product will contain any viruses, Trojan horses or other harmful code. The above warranties are valid for a period of [***] from the date of shipment of any Licensed Product to any customer.   (b) The warranty contained in Section 11.2(a) does not apply to the extent any Product is operated in a manner other than that specified by the Product Specifications, is treated with abuse, negligence or other improper treatment (including, without limitation, use outside the device maximum ratings, package MSL (moisture sensitivity level) guidelines or environmental limits as may be set forth in the Product Specifications), or is defective as a result of any materials or workmanship of the Manufacturing Subcontractors or failure of the Manufacturing Subcontractors to manufacture the Product according to Approved Production Specifications. As such, any warranty claims due to defects in build, materials or workmanship will be directed to the Manufacturing Subcontractors as part of that contract between DIALOG or, if applicable, its Affiliate and such parties.   (c) With the exception of the warranties in Section 11.2(a)(ii) (third party IP infringement) and Section 11.2(a)(iii) (misappropriation of third party trade secrets) related to any Product Die, the warranties in this Section 11.2 do not apply to MCMs or repackaged Product Die developed by or for DIALOG or its Affiliates.   (d) In the event any warranty claim is due to or arises from an Epidemic Defect, ENERGOUS will be responsible for all costs and expenses directly incurred by DIALOG or its Affiliates or their respective customers as a result of reasonable inspection, servicing, repairs, replacements, recall notices, recalls and responses with respect thereto, provided that ENERGOUS' aggregate liability to DIALOG and its Affiliates and their respective customers under this paragraph (d) will not exceed [***] per occurrence of an Epidemic Defect. Each party will immediately notify the other upon becoming aware of the circumstance that could reasonably be construed to be an indication of an Epidemic Defect, and, in any event, will notify the other party immediately upon becoming aware of the existence of an Epidemic Defect. ENERGOUS and DIALOG will expeditiously work together in good faith to determine a technical resolution of the Epidemic Failure. ENERGOUS agrees to make all commercially reasonable efforts to promptly diagnose the Epidemic Failure's root cause, provide DIALOG a report detailing the results of ENERGOUS' investigation and plan an effective workaround and a permanent solution. ENERGOUS will consult with DIALOG on any proposed workarounds and other solutions.   * Confidential Treatment Requested

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  11.3  Infringement of Intellectual Property Rights. If any of the Products, Product Die, Documentation or Deposit Materials is, or in ENERGOUS' or DIALOG's opinion is likely to become, the subject of an Intellectual Property Rights infringement claim, and as a result DIALOG or any of its Affiliates or their respective customers are enjoined, or in ENERGOUS' or DIALOG's opinion are likely to be enjoined, from using the Products, Product Die, Documentation or Deposit Materials, ENERGOUS will use its best efforts to:   (a) procure for DIALOG and its Affiliates and their respective customers the right to continue to use the Products, Product Die, Documentation or Deposit Materials, as applicable; or, but only in the event that, despite ENERGOUS' best efforts to do so, ENERGOUS is unable to so procure such right,   (b) replace or modify the Products, Product Die, Documentation or Deposit Materials, as applicable, to make them non-infringing, provided that the replaced or modified Products, Product Die, Documentation and Deposit Materials remain substantially similar in performance to the infringing Products, Product Die, Documentation and Deposit Materials.   If none of the foregoing alternatives is available within a commercially reasonable time period, DIALOG may terminate this Agreement with immediate effect, provided that it will give ENERGOUS prompt prior written notice thereof. Nothing in this Section 11.3 is intended to limit DIALOG's rights to indemnification under Section 12 in connection with any such infringement claim.   11.4  Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 11, THE PRODUCTS, THE PRODUCT IP, TOOLING, DOCUMENTATION, DEPOSIT MATERIALS, CONFIDENTIAL INFORMATION AND ALL LICENSES, SERVICES AND OTHER ITEMS PROVIDED BY A PARTY TO THE OTHER PARTY HEREUNDER ARE PROVIDED AS IS, WITHOUT WARRANTY OF ANY KIND. EXCEPT FOR THOSE WARRANTIES EXPRESSLY PROVIDED HEREIN, EACH PARTY SPECIFICALLY DISCLAIMS ALL WARRANTIES, WHETHER ORAL OR WRITTEN, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, ALL WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE AND ALL WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE IN TRADE.   12. INDEMNIFICATION.   12.1 Indemnification by Energous. Subject to Section 12.2, ENERGOUS agrees to indemnify, hold harmless and, in the case of any third party claims, defend DIALOG and its Affiliates and each of their respective directors, officers, employees, contractors, agents, distributors and customers (collectively, DIALOG Indemnitees) from and against and in respect of any and all alleged or actual demands, claims, actions, causes of action, suits or proceedings, assessments, awarded damages (including punitive damages), liabilities, interest and penalties, costs and expenses (including, without limitation, court costs and reasonable legal fees and disbursements in connection therewith) (each, a Claim) to the extent resulting from, arising out of, relating to, or imposed upon or incurred by any DIALOG Indemnitees by reason of (a) death or bodily injury caused by or resulting from use of the Products, (b) any breach of any representation or warranty made by ENERGOUS hereunder or to any third party in relation to the Products or Product Die, (c) the infringement or misappropriation of any third party Intellectual Property Rights in relation to the Products or Product Die, (d) the infringement or misappropriation of any third party Intellectual Property Rights as a result of DIALOG's or its Affiliates' exercise of rights in accordance with the terms of this Agreement, including, but not limited to, the Manufacturing Subcontractors' manufacture of the Products on their behalf, provided that the Products are manufactured in strict compliance with the Product Specifications and Approved Production Specifications and only to the extent such Claims arise due to compliance with the Product Specifications and/or the Approved Production Specifications or use of the Tooling provided by ENERGOUS hereunder, (e) the infringement by DIALOG of any third party Marks rights as a result of its authorized use of the ENERGOUS Marks, (f) any failure by ENERGOUS to comply with applicable laws, regulations and standards, or (g) ENERGOUS' negligence, intentional misconduct or fraud.

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  12.2 Exclusion. Notwithstanding the provisions of Section 12.1, ENERGOUS will not be liable to the extent any Claim results from (a) modification of the Products by DIALOG, its Affiliates and/or any third party (including the Manufacturing Subcontractors), or combination of the Products with other products, offered by DIALOG, its Affiliates and/or any third party, (b) acts or omissions of any Manufacturing Subcontractor (except to the extent such Claims are due to the infringement or misappropriation of third party Intellectual Property Rights arising from such Manufacturing Subcontractor's manufacturing of the Products on behalf of DIALOG in strict compliance with the Product Specifications, Approved Production Specifications and Tooling provided by ENERGOUS), (c) failure of any DIALOG Indemnitee to comply with applicable laws, regulations and standards, or (d) negligence, intentional misconduct or fraud of any DIALOG Indemnitee. For clarification, if any of the foregoing is not the cause, in whole or in part of the Claim, ENERGOUS is not relieved of its obligations under Section 12.1.   12.3 Conditions. DIALOG must notify ENERGOUS within thirty (30) business days after receipt of actual notice of any Claim by a third party for which it seeks indemnification; provided, however, any failure or delay in notice will not relieve ENERGOUS of its obligations hereunder except to the extent that ENERGOUS is actually prejudiced by such failure to notify. ENERGOUS will have control and authority with respect to the defense, litigation, compromise or settlement of such third party Claim (except to the extent that any settlement involves any commitments, responsibilities or obligations on the part of DIALOG, in which case such settlement will require the prior written consent of DIALOG, which consent will not be unreasonably delayed, conditioned or withheld). DIALOG will cooperate and provide assistance and information as may reasonably be required by ENERGOUS (but at ENERGOUS' expense) in connection therewith. DIALOG reserves the right to participate at its own cost in any third party proceedings with counsel of its own choosing. In the event that ENERGOUS does not respond to any third party Claim or does not sufficiently defend such third party Claim, DIALOG, acting reasonably, may step in and take over the defense of such Claim. Costs incurred in the settlement of any Claim, including, but not limited to, reasonable legal expenses, may be off set against future Royalties and Service Fees payable.

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  12.4 Insurance. Each party will maintain, during the Term and for three (3) years thereafter, such comprehensive general liability insurance (including without limitation, products liability) as will adequately protect it against its potential liabilities under this Agreement, in amounts customary in the semiconductor industry for similar services and products. Each party will, at the other party's request, provide to the other party a certificate of insurance evidencing the foregoing insurance coverage.   13. LIMITATION OF LIABILITY.   13.1 EXCEPT IN THE CASE OF (a) ANY BREACH OF SECTION 10 (CONFIDENTIALITY), (b) THE PARTIES' OBLIGATIONS UNDER SECTION 12 (INDEMNIFICATION), (c) A PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, OR (d) LIABILITY ARISING FROM EPIDEMIC DEFECTS (WHICH WILL BE SUBJECT TO THE LIMITATION SET FORTH IN SECTION 11.2(d)), IN NO EVENT WILL EITHER PARTY BE LIABLE UNDER THIS AGREEMENT, REGARDLESS OF THE FORM OF ANY CLAIM OR ACTION (WHETHER IN CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE), FOR ANY (i) INDIRECT, PUNITIVE, INCIDENTAL, RELIANCE, SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS OF BUSINESS, REVENUES, PROFITS OR GOODWILL, OR (ii) AGGREGATE DAMAGES IN EXCESS OF [***]. IN ADDITION, ENERGOUS' LIABILITY WITH RESPECT TO ITS OBLIGATIONS UNDER SECTION 12.1(b) SHALL IN NO EVENT EXCEED [***]. THESE LIMITATIONS ARE INDEPENDENT FROM ALL OTHER PROVISIONS OF THIS AGREEMENT AND WILL APPLY NOTWITHSTANDING THE FAILURE OF ANY REMEDY PROVIDED HEREIN.   14. COMPLIANCE WITH LAWS.   Each party will comply with all law and regulations applicable such party's performance under this Agreement, including but not limited to U.S. Export Administration laws and regulations and any other export, import and re-export control laws applicable to such party. The parties will refrain from exporting or re-exporting the Products or Product IP or any technical data or other materials received from each other, or the direct product of any of these, to any country, individual or organization proscribed by the United States government, unless properly authorized by the appropriate agencies of the United States government. Each party will provide all information under its control which is necessary or useful for the other party to ship or receive the Products, including, but not limited to, U.S. Export Control Classification Numbers (ECCNs), U.S. Customs Certificates of Delivery, Certificates of Origin and U.S. Federal Communications Commission identifier, if applicable. Each party agrees that it will not act in any fashion or take any action in violation of any applicable anti-bribery or anti-corruption legislation in any jurisdiction in which it does business, which prohibits the offering, giving or promising to offer or give, directly or indirectly, money or anything of value to any official of a government, political party or instrumentality to assist it in obtaining or retaining business, including the U.S. Foreign Corrupt Practices Act or any comparable legislation in another country.   * Confidential Treatment Requested

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  15. TERM AND TERMINATION.   15.1 Term. This Agreement is effective on the Effective Date. Unless earlier terminated as provided herein, this Agreement continues in effect for an initial term of seven (7) years (Initial Term) and will automatically renew for one or more annual periods after the Initial Term (each a Renewal Term) unless either party gives notice of non-renewal at least one hundred eighty (180) days prior to the beginning of any Renewal Term.   15.2 Termination.   (a) Mutual Termination Rights. Either party may, in addition to any other remedies available to it under this Agreement or at law or in equity, terminate this Agreement (or, in the event this Agreement has been previously terminated, the Wind Down Period, if any) immediately upon the issuance of written notice to the other party in the event that (i) the other party materially breaches a material provision of this Agreement, and fails to cure such breach within thirty (30) days, or (ii) the other party undergoes an Insolvency Event.   (b) Termination By ENERGOUS.   (i) If ENERGOUS is acquired by a third party, ENERGOUS' acquirer will have the right, for a period of [***] following closing of such acquisition, to terminate this Agreement upon written notice to DIALOG.   (ii)  ENERGOUS will have the right to terminate this Agreement immediately upon the issuance of written notice to DIALOG (A) if DIALOG undergoes a Change of Control involving a competitor of ENERGOUS (as reasonably determined by ENERGOUS), or (B) if DIALOG or any of its Affiliates acquires, whether directly or indirectly through a sale of assets or a Change of Control transaction or otherwise, any competitor of ENERGOUS. DIALOG will provide ENERGOUS with notice of any such Change of Control or acquisition within [***] after the closing thereof and ENERGOUS' right to terminate the Agreement will expire [***] after receipt of such notice.   (iii) ENERGOUS may, at any time after the third anniversary of the Effective Date, terminate this Agreement with or without cause upon not less than one hundred and eighty (180) days prior written notice to DIALOG.   (iv) ENERGOUS will have the right to terminate this Agreement, upon not less than [***] prior written notice to DIALOG, in the event that, following termination by the [***] of its agreement with ENERGOUS, DIALOG participates in or indicates its intention to participate in the development, design or manufacture of products incorporating Uncoupled Power Transfer Technology not provided by ENERGOUS to [***].   (c) Termination by DIALOG.   (i) If DIALOG is acquired by a third party, DIALOG's acquirer will have the right, for a period of [***] following closing of such acquisition, to terminate this Agreement upon written notice to ENERGOUS.   * Confidential Treatment Requested

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  (ii) DIALOG may terminate this Agreement, immediately upon issuance of written notice to ENERGOUS in the event that: (A) DIALOG or its Affiliates fail to achieve a design-win pipeline with an annual projected sales value to DIALOG of at least [***] in the [***] after the availability of a Mass Production Qualified Product; or (B) the aggregate annual Net Sales of Products are below [***] by the [***] of the availability of a Mass Production Qualified Product, or below [***] by the [***] of the availability of a Mass Production Qualified Product, or below [***] by each [***] of the availability of a Mass Production Qualified Product during the remainder of the Term.   (iii)  DIALOG will have the right to terminate this Agreement immediately upon the issuance of written notice to ENERGOUS (A) if ENERGOUS undergoes a Change of Control involving a competitor of DIALOG, or (B) if ENERGOUS acquires, whether directly through a sale of assets or through a Change of Control transaction, any competitor of DIALOG (as reasonably determined by DIALOG). ENERGOUS will provide DIALOG with notice of any such Change of Control or acquisition within [***] after the closing thereof and DIALOG's right to terminate the Agreement will expire [***] after receipt of such notice.   15.3 Effect of Termination. Upon any termination or expiration of this Agreement, all rights, licenses (including any sublicenses granted by DIALOG) and obligations hereunder will cease, except that the provisions of Sections 6 (Intellectual Property Ownership), 9 (Royalties and Service Fees), 10 (Confidentiality), 11 (Representations and Warranties; Disclaimers), 12 (Indemnification), 13 (Limitation of Liability), 15.3 (Effect of Termination), 15.4 (Wind Down Period), 16 (Escrow), 18 (Non-Solicitation), 19 (Choice of Law and Dispute Resolution) and any provisions to give effect thereto, will survive such termination or expiration and remain in full force and effect in accordance with their terms.   15.4 Wind Down Period.   (a) Notwithstanding any statement in Section 15.3 to the contrary, upon any termination or expiration of this Agreement and until the later to occur of (i) [***] from the Effective Date or (ii) [***] following the effective date of termination or expiration of this Agreement (the Wind Down Period), the parties' respective rights and obligations under Sections 2 (License), 3 (Sourcing), 7 (Product Sales), 9 (Royalties and Service Fees), 11 (Representations and Warranties; Disclaimers), 12 (Indemnification), 13 (Limitation of Liability), 14 (Compliance with Laws), 15.2 (Termination), 16 (Escrow) and all Exhibits hereto which are associated with any of the foregoing listed sections will remain in full force and effect as to (A) any Products or repackaged Product Die with respect to which DIALOG or any of its Affiliates has secured a design win at a customer prior to or within one (1) month after the start of the Wind Down Period, or (B) the sale of any MCMs which have been released for production at a foundry, provided, however, that DIALOG's license rights under Section 2.1 (including any sublicenses granted by DIALOG pursuant to Section 2.4) will be non-exclusive during the Wind Down Period.   (b) If, at the time of notice of any termination of this Agreement, DIALOG or any of its Affiliates has a written supply contract with a customer that extends beyond the end of the Wind Down Period (a Continuing Obligation), DIALOG and/or its Affiliates may continue to Sell Licensed Products to such customer through the term of the Wind Down Period and for the remainder of the term of such Continuing Obligation, provided that in no event may DIALOG or its Affiliates Sell Licensed Products to such customer pursuant to this Section 15.4(b) for a period longer than [***] after the effective date of termination of this Agreement. In such event, the provisions of this Agreement that survive during the Wind Down Period will continue to survive for the remainder of the period of time that DIALOG is authorized to Sell Licensed Products to any customer in accordance with the foregoing sentence. The rights granted under this Section 15.4(b) will be conditioned upon DIALOG providing ENERGOUS a complete or redacted copy of the applicable supply contract demonstrating the existence of the Continuing Obligation as of the date of notice of termination or, if DIALOG or its Affiliate is prohibited from providing a copy of the contract by the confidentiality obligations set forth therein, a written certification from an officer of DIALOG attesting to the existence of the Continuing Obligation.   * Confidential Treatment Requested

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  16. ESCROW.   16.1 Escrow. ENERGOUS will at its expense, at DIALOG's written request during the Term and any Wind Down Period, enter into a three- party escrow deposit arrangement, in accordance with this Section 16, with a recognized escrow agent (the Escrow Agent) of mutual agreement. ENERGOUS will keep the Deposit Materials in escrow and ensure on a quarterly basis that all the information relating to the Deposit Materials in escrow is current, including deposit of any Product Updates.   16.2 Release of Deposit Materials. In the event of any Insolvency Event and where the design files need to be accessed by DIALOG to fix an Epidemic Defect or other Product design or production issue impacting yield or quality (Release Condition), the Escrow Agent will, in accordance with the terms of the escrow agreement between the parties and the Escrow Agent (the Escrow Agreement), release the Deposit Materials to DIALOG.   16.3 License. ENERGOUS hereby grants DIALOG a non-exclusive, non-transferable (except as set forth in Section 2) license under the Product IP to use any of the Deposit Materials released from escrow for the purpose of fixing an Epidemic Defect or other Product design or production issue impacting yield or quality during the Term and, if applicable, any Wind Down Period or Continuing Obligation period, including, but not limited to, authorizing any third party subcontractor to manufacture and supply Products, provided, however, that DIALOG continues to make all Royalty payment owed to ENERGOUS (or the then-current owner of the Product IP) as provided in this Agreement. No Service Fees will be payable under this license. DIALOG agrees not to exercise such license until occurrence of a Release Condition, subject to the other restrictions set forth in this Section 16. Such license may be exercised by DIALOG only during the Term and any Wind Down Period or Continuing Obligation period and is subject to DIALOG's continued compliance with all of the other applicable terms and conditions of this Agreement during any such applicable period. All Deposit Materials will be deemed ENERGOUS' Confidential Information hereunder. DIALOG's license to possess and use the Deposit Materials does not include any right to disclose, market, sublicense or distribute the Deposit Materials to any third party other than its Affiliates and Manufacturing Subcontractors.   16.4 Rights in Bankruptcy. The licenses granted pursuant to this Agreement are license to rights in intellectual property (as that term is defined in Section 101 of the United States Bankruptcy Code) and governed by 11 USC Section 365(n). Accordingly, if a trustee in bankruptcy rejects the Escrow Agreement and/or this Agreement as executory contracts, then Company may elect to retain its rights under this Agreement in accordance with and subject to the provisions of 11 USC Section 365(n).

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  17. PUBLICITY.   17.1 Publicity. Within 30 days of the Effective Date each party will issue a mutually agreed joint press release regarding the strategic cooperation for the supply of Products and the strategic cooperation between the parties.   18. NON-SOLICITATION.   18.1 Non-Solicitation. During the Term and for a [***], neither party will without the written consent of the other party (which may be granted or denied in its sole discretion) (a) directly or indirectly recruit or solicit for employment or for the provision of services any employee of the other party, (b) otherwise solicit, induce or influence any employee to leave their employment with the other party, or (c) attempt to do any of the foregoing; provided, however, that the foregoing will not apply to (y) any employee of the other party that responds to a public advertisement of employment opportunities or (z) any employee that was terminated without cause by the other party. ENERGOUS and DIALOG acknowledge and agree that the covenants in this Section 18 are reasonable and necessary to protect each of their trade secrets, Confidential Information and stable workforces.   19. CHOICE OF LAW AND DISPUTE RESOLUTION.   19.1 Applicable Law. This Agreement will be governed by and construed in accordance with the laws of the State of California, exclusive of conflict of laws principles.   19.2 Dispute Resolution; Jurisdiction. Any dispute or claim arising out of or relating to this Agreement (including any matters regarding its existence, scope, validity, breach or termination, or any non-contractual obligations arising out of or related to it) that is not able to be resolved through negotiations will be submitted to arbitration in San Francisco, California, administered by the International Chamber of Commerce under its Rules of Arbitration. There will be one arbitrator. The language of the arbitration will be English. The award will be in writing, state the reasons for the award and be final and binding. Judgment on the award may be enforced in any court of competent jurisdiction. Except as may be required by law, the parties will preserve the confidentiality of all aspects of the arbitration. The arbitration will be the sole and exclusive forum for final resolution of any such dispute or claim, provided, however, that, because each party will have access to and become acquainted with Confidential Information of the other party, the unauthorized use or disclosure of which may cause irreparable harm and significant injury which may be difficult to ascertain and which may not be compensable by damages alone, the parties agree that the damaged party will have the right to seek an injunction, specific performance or other equitable relief without prejudice to any other rights and remedies that it may have for such unauthorized use or disclosure. Each party irrevocably waives all rights to a jury trial in any judicial proceeding permitted hereunder. For the avoidance of doubt, the validity, construction, and enforceability of this Agreement and the resolution of disputes arising out of and relating to this Agreement, will be governed solely by this Section 19.   * Confidential Treatment Requested

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  20. MISCELLANEOUS PROVISIONS.   20.1 Notices. All notices required or permitted under this Agreement will be in writing, reference this Agreement and be deemed given: (a) when delivered personally; or (b) when sent by electronic mail with electronic confirmation of receipt, provided that such notice is immediately confirmed as provided in (c) or (d) below; or (c) seven (7) days after having been sent by registered or certified mail,; or (d) two (2) days after deposit with a commercial courier service, with written verification of receipt. All communications will be sent to the addresses set forth below. Either party may change its address by giving notice pursuant to, and specifically referring to, this Section 20.   If to ENERGOUS:   Energous Corporation 3590 North First Street Suite 210 San Jose, California 95134 U.S.A. Attn: Brian Sereda, CFO

If to DIALOG:   Dialog Semiconductor (UK) Ltd 100 Longwater Avenue Green Park Reading, RG2 6GP United Kingdom Attn: Legal Department   20.2 Relationship of Parties. ENERGOUS and DIALOG are independent business entities. Neither party nor its employees, consultants, contractors or agents are agents, employees, partners or joint venturers of the other party, nor do they have any authority to bind the other party by contract or otherwise to any obligation. The parties will not represent to the contrary, either expressly, implicitly, by appearance or otherwise.   20.3 Force Majeure. Except for obligations to pay amounts due under this Agreement, neither party will be liable for any failure or delay in its performance under this Agreement due to causes which are beyond its reasonable control, including, but not limited to, acts of God, acts of civil or military authority, fires, epidemics, floods, earthquakes, riots, wars, sabotage, labor shortages or disputes, and governmental actions; provided, however, that the affected party: (a) gives the other party written notice of such cause promptly, and in any event within fifteen (15) days of discovery thereof; and (b) uses its reasonable efforts to correct such failure or delay in its performance as soon as possible. The affected party's time for performance or cure under this Section 20.3 will be extended for a period equal to the duration of the cause.   20.4 Severability. If any provision of this Agreement is held to be invalid or unenforceable in any jurisdiction in which this Agreement is being performed, then: (a) such provision will be deleted from this Agreement in that jurisdiction to the extent of such invalidity or unenforceability without invalidating the remaining provisions of this Agreement, and any such unenforceability in that jurisdiction will not make that provision unenforceable in any other jurisdiction; and (b) the parties will agree on an alternative provision that best accomplishes the objectives of such provision, to the extent legally permissible in such jurisdiction.

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  20.5 No Waiver. No waiver or consent in connection with or relating to this Agreement will bind either party unless in writing and signed by the party against which enforcement is sought. Waiver by either party of any default will not be deemed a waiver by such party of the same or any other default that may thereafter occur.   20.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which will be an original, but taken together constituting one and the same instrument. Execution of a facsimile copy (including PDF) will have the same force and effect as execution of an original, and a facsimile/electronic signature will be deemed an original and valid signature.   20.7 Headings and References. The headings and captions used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.   20.8 Construction. The parties and their respective counsel have negotiated this Agreement. This Agreement will be fairly interpreted in accordance with its terms and without any strict construction in favor of or against either party.   20.9 Complete Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes and replaces all prior or contemporaneous understandings or agreements, written or oral, regarding such subject matter. No amendment to or modification of this Agreement will be binding unless in writing and signed by a duly authorized representative of both parties.   20.10 Assignment. This Agreement may not be assigned by either party without the express written consent of the other party, which approval will not be unreasonably withheld or delayed, except that either party may (without consent but with notice to the other party) assign this Agreement in its entirety to any successor in the event of a Change of Control of such party.   20.11 Notice of Merger or Acquisition. Until the date that this Agreement terminates or is terminated in accordance with Section 15 hereof, ENERGOUS agrees that, [***].   * Confidential Treatment Requested

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  IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.   ENERGOUS CORPORATION   DIALOG SEMICONDUCTOR (UK) LTD           By: /s/ Stephen R. Rizzore   By: /s Mark Tyndall           Name: Stephen R. Rizzore   Name: Mark Tyndall           Title: President and Chief Executive Officer   Title: SVP Corporate Development and Strategy

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  EXHIBIT A   PRODUCTS   Any ENERGOUS integrated circuit (IC) designed to receive power wirelessly and any ENERGOUS IC used in a wireless transmitter, including, but not limited to, the following Products (and any related Product Updates):   [***]     * Confidential Treatment Requested

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  EXHIBIT B   ROYALTIES AND SERVICE FEES   Royalties and Service Fees payable by DIALOG and/or its Affiliates to ENERGOUS hereunder will be calculated on a Product by Product basis as defined herein.   Margin Split:   Combined Royalties and Service Fees shall equal [***].   Dialog will retain the remaining [***].   [***].   [***].   Notwithstanding any provision of the Agreement, no Royalties or Service Fees will be payable to ENERGOUS hereunder in connection with any Sale to any customer of prototype or sample Licensed Products [***].   * Confidential Treatment Requested

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  EXHIBIT C   Example of Letter of Authorization: Mask Set(s) Authorization for Third Party's Product(s)   To whom it may concern   Pursuant to a STRATEGIC ALLIANCE Agreement between Dialog Semiconductor (UK) Ltd and Energous Corporation dated November 6, 2016 (to which [Manufacturing Subcontractor] is not a party), we, Energous Corporation (Energous), hereby agree and authorize [Manufacturing Subcontractor], under the terms of this Letter of Authorization, to use the Mask Set(s) specified below for manufacturing products for the supply to the Third Party specified in paragraph 2 below only:   1. Mask Set(s) details: Mask Set(s) Product Type: Foundry Code:   2. Third Party details: Third Party's Name: Dialog Semiconductor [purchasing entity to be determined] Third Party's Address: Contact name of Third Party:   3. Volume of products The number of products to be manufactured with the Mask Set(s) will be unlimited, unless otherwise instructed by us below:   Authorized Amount: [UNLIMITED]   4. Duration of Authorization The duration of this Letter of Authorization will be unlimited, unless otherwise instructed by us below:   Duration of Authorization: [UNLIMITED]   5. Confidential Information Other than wafers for products specified under paragraph 1 above (which contain Energous designs), [Manufacturing Subcontractor] will not disclose to the Third Party any information which is proprietary or confidential to Energous.

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  6. Reporting Upon Energous' request (but not more frequently than once per calendar year), [Manufacturing Subcontractor] will provide Energous with the accumulated wafer volumes ordered (and shipped) to the Third Party under this Letter of Authorization. By signing this Letter of Authorization, the Third Party authorizes [Manufacturing Subcontractor] to report to Energous accordingly.   8. Governing Law This Letter of Authorization will be governed by and construed in accordance with the laws of California, excluding its conflict of laws provisions, and be subject to the non-exclusive jurisdiction of the California courts.   Very truly yours,       Energous Incorporated           Name:       Title:       Date:                   Agreed by Dialog Semiconductor (UK) Ltd           Name:       Title:       Date:     This Letter of Authorization is subject to the approval of the Manufacturing Subcontractors.

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  EXHIBIT D   LICENSED MARKS   DIALOG LICENSED MARKS:   Dialog Dialog Semiconductor   ENERGOUS LICENSED MARKS:   Energous WattUp Unleash your power   Pending:   [***]   * Confidential Treatment Requested

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  EXHIBIT E   Commercialization plan   Objective   The Commercialization Plan sets forth the parties' respective rights and obligations with respect to commercial and technical activities to be performed to maximize potential Sales of Licensed Products.   [***]   Review   O The Commercialization Plan will be reviewed and (if necessary) updated by the parties on a quarterly basis throughout the Term of the agreement.     * Confidential Treatment Requested

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  EXHIBIT F   CUSTOMER: [***]     * Confidential Treatment Requested

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answer:

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?