Document:

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EXHIBIT 10.1
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[*CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS
DOCUMENT. EACH SUCH PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN
ASTERISK [*], HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]

                        EXCLUSIVE DISTRIBUTION AGREEMENT
                        --------------------------------

         This EXCLUSIVE DISTRIBUTION AGREEMENT ("AGREEMENT") is made and entered
into effective as of November 9, 2006 (the "EFFECTIVE DATE") by and between
Inamed Medical Products Corporation ("ALLERGAN"), a wholly owned subsidiary of
Allergan, Inc., a Delaware corporation, whose principal office is at 2525 Dupont
Drive, Irvine, California 92612, and Ivivi Technologies, Inc. ("IVIVI"), a New
Jersey corporation whose principal office is at 224-S Pegasus Avenue, Northvale,
New Jersey 07647.

                                    RECITALS

         A. Ivivi has developed a pulsed electromagnetic field generating device
commonly known as SofPulse(R).

         B. Ivivi desires to grant Allergan the exclusive right to distribute
and sell SofPulse(R), and all Improvements, line extensions and future
generations of such device, worldwide in the Field (as defined below).

         C. Ivivi and Allergan desire to enter into this Agreement in order to
set forth the terms and conditions of such distribution right and all other
rights and obligations of the parties relating thereto.

         NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual representations, warranties, covenants and agreements contained herein,
the parties hereto agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS

         1.1 "ACT" shall mean the United States Food, Drug and Cosmetic Act and
the regulations promulgated thereunder, as amended from time to time.

         1.2 "AFFILIATES" shall mean, with respect to either party, those
entities controlled by, in control of, or under common control with such party.
A corporation or non-corporate business entity shall be regarded as in control
of another corporation or business entity (i) if it owns or directly or
indirectly controls a majority of the voting stock of the other corporation, or
(ii) in the absence of the ownership of a majority of the voting stock of a
corporation or in the case of a non-corporate business entity, if it possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such corporation or non-corporate business entity, as
applicable.

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         1.3 "AFFILIATED PARTIES" means, in respect of any specified party, all
Affiliates, directors, officers, employees, agents and representatives of such
party.

         1.4 "APPLICABLE MARKET" shall mean the American Stock Exchange or any
other exchange or market on which Ivivi securities are then traded or listed.

         1.5 "BANKRUPTCY CODE" shall mean the Federal Bankruptcy Act and the
regulations promulgated thereunder, as amended from time to time.

         1.6 "CANADIAN MARKETING CLEARANCE" shall mean any and all approvals,
including but not limited to, clearances, licenses, certifications, exemptions,
labeling approvals, product and/or establishment licenses, registrations or
authorizations of any regulatory agency, department, bureau or other government
entity, necessary for the commercial use, storage, importation, exportation,
transport or sale of the Product in Canada. Pricing and reimbursement approvals
shall be deemed to be included in the foregoing definition to the extent
applicable, in which case Ivivi shall make commercially reasonable efforts to
obtain such approvals.

         1.7 "EU" shall mean the European Union.

         1.8 "EU MARKETING CLEARANCE" shall mean any and all approvals,
including but not limited to, clearances, licenses, certifications, exemptions,
labeling approvals, product and/or establishment licenses, registrations or
authorizations of any regulatory agency, department, bureau or other government
entity, necessary for the commercial use, storage, importation, exportation,
transport or sale of the Product in the EU. Pricing and reimbursement approvals
shall be deemed to be included in the foregoing definition to the extent
applicable, in which case Ivivi shall make commercially reasonable efforts to
obtain such approvals.

         1.9 "FAILURE TO SUPPLY" shall have the meaning set forth in SECTION
4.3.

         1.10 "FDA" shall mean the Food and Drug Administration of the U.S.
Department of Health and Human Services.

         1.11 "FIELD" shall mean directly or indirectly to or through any third
party including, without limitation, consumers, patients, users or health care
professionals of any specialty, who may use, sell or purchase the Product in
conjunction with any aesthetic or bariatric procedure, including but not limited
to the following markets: plastic surgery, facial plastic surgery, ocular
plastic surgery, cosmetic surgery, reconstructive surgery, dermatologic surgery,
maxillofacial surgery, dermatology, oral surgery (cosmetic related), and
bariatric surgery.

         1.12 "FISCAL QUARTER" shall mean any of the four periods defined as
follows: The first Fiscal Quarter commences on January 1. The second, third and
fourth Fiscal Quarters commence on the day following the end of the preceding
Fiscal Quarter. The first, second, and third Fiscal Quarters end on the last
Friday of the respective calendar quarters of each year. The fourth Fiscal
Quarter ends on December 31.

         1.13 "FIRST COMMERCIAL SALE" shall have the meaning set forth in
SECTION 5.6

         1.14 "FORECAST" shall have the meaning set forth in SECTION 4.2(a).

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         1.15 "GMP/QSR REGULATIONS" shall mean the Good Manufacturing
Practices/Quality System Regulations set forth in 21 C.F.R. Part 820.

         1.16 "GOVERNMENTAL HEALTH AUTHORITY" shall mean, with respect to any
country, any and all governmental or regulatory bodies or authorities having the
authority to approve the import, storage, export, transport, manufacture, sale
and use of the Product.

         1.17 "IMPROVEMENT" shall mean any adaptation, change, redesign,
improvement, refinement or modification to the Product or the Specifications
therefor or the method or process of manufacture or production of the Product.

         1.18 "INTELLECTUAL PROPERTY" shall mean all patents, trademarks, trade
names, service marks, trade dress, trade secrets, and copyrights, including,
without limitation, any renewal, extension or other rights therefor, and
applications, provisionals, divisionals, reexaminations, continuations in part,
divisions, continuations, reissues, additions, substitutions and registrations
for any of the foregoing and all corresponding foreign patents and patent
applications of each of the foregoing, technical information, devices,
processes, procedures, discoveries, techniques, formulae, software, designs,
drawings, data, trade secret, methods, protocols, products, apparatuses and
other materials, compositions, mask works, domain names, schematics,
manufacturing processes, know-how, moral rights, software programs or
applications, manufacturing and production processes and techniques, research
and development information, drawings, specifications, designs, plans,
proposals, technical data, financial and marketing plans, customer and supplier
lists and information, and all other intellectual property or proprietary
rights.

         1.19 "IVIVI INTELLECTUAL PROPERTY" shall mean all Intellectual Property
and Patents related to or used in connection with or embodied in the Product
including, without limitation, the development, manufacture, processing,
packaging, use or sale of the Product.

         1.20 "LICENSE" shall have the meaning set forth in SECTION 3.1.

         1.21 "MANUFACTURING COST" shall mean [*]. Allergan is aware that ADM is
Ivivi's largest shareholder and is currently the exclusive manufacturer of
Ivivi's products, including the Product. Ivivi agrees that, commencing [*], it
will contact at least [*] reputable manufacturers (selected after reasonably
considering suggestions from Allergan) per year ("Bidders") to determine whether
Ivivi can obtain a better price for the Product from a different manufacturer.
[*]. Ivivi represents and warrants that its agreement with ADM allows Ivivi to
terminate exclusivity in the event that ADM refuses to match any such lower
price, and Ivivi agrees that it will not amend any agreement with ADM in any
way, without the prior written consent of Allergan, if such amendment may
adversely affect the timing of deliveries to Allergan or the price paid by
Allergan for the Product. Without limiting the generality of the foregoing,
Ivivi agrees that it shall not amend any terms affecting pricing including,
without limitation, the margin to be paid for the Product by Ivivi (I.E., the
percentage charged by ADM to Ivivi in excess of ADM's direct costs), which is
currently twenty percent (20%), without the prior written consent of Allergan.

         1.22 "MANUFACTURING LICENSE PERIOD" shall have the meaning set forth in
SECTION 4.3.

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         1.23 "NET SALES" means [*].

         1.24 "PATENTS" shall mean the patents set forth on SCHEDULE E,
including, without limitation, any new or future patents relating to the Product
in the Field and any renewal, extension or other rights therefor and
applications, provisionals, divisionals, re-examinations, continuations in part,
divisions, continuations, reissues, additions, substitutions and registrations
for any of the foregoing and all corresponding foreign patents and patent
applications of each of the foregoing.

         1.25 "PRODUCT" shall mean the SofPulse(R) product and the Torino(TM)
product and any other products that are useful for prevention or treatment of
[*] or with uses within the Field, including all Improvements, line extensions
and future generations of any of the foregoing.

         1.26 "REGULATORY APPROVAL" shall mean EU Marketing Clearance, Canadian
Marketing Clearance or U.S. Marketing Clearance, as applicable, or with respect
to the Product in any other country or jurisdiction, all other registrations,
approvals (including, but not limited to, labeling approvals), licenses
(including, but not limited to, product and/or establishment licenses) and
authorizations by a Governmental Health Authority required for the marketing,
importation, exportation, transport, storage, manufacture, commercial use and
sale of the Product in such country. Pricing and reimbursement approvals shall
be deemed to be included in the foregoing definition to the extent applicable,
in which case Ivivi shall make commercially reasonable efforts to obtain such
approvals.

         1.27 "REMEDIAL ACTION" shall have the meaning ascribed thereto in
SECTION 10.4.

         1.28 "SPECIFICATIONS" shall mean the specifications for the Product,
including the design, composition, output, product safety assurance,
manufacture, packaging, and/or quality control of the Product, as set forth on
SCHEDULE B attached hereto and made a part hereof, as the same may hereafter be
modified or updated by mutual agreement in writing to address Improvements, line
extensions and future generations of the Product and any other products that are
useful for prevention or treatment of [*] or with uses within the Field.

         1.29 "TERRITORY" shall mean the world.

         1.30 "TRADEMARKS" shall mean the trademarks owned by Ivivi as set forth
on SCHEDULE F.

         1.31 "TRANSFER PRICE" shall have the meaning ascribed thereto in
SECTION 5.1.

         1.32 "UNIT" shall mean an individual item of Product. For the avoidance
of doubt, a Unit may be comprised of two items of the Product if packaged to be
sold or marketed as one SKU, such determination regarding the SKU to be made at
Ivivi's reasonable discretion. For example, currently, two items of the Product
are packaged together as one SKU for use in breast-related treatments and
therefore constitute one Unit.

         1.33 "U.S. MARKETING CLEARANCE" shall mean any governmental approvals,
including but not limited to, FDA approval, clearances, certifications,
exemptions, labeling approvals, licenses (including, but not limited to, product
and/or establishment), registrations or authorizations of any regulatory agency,

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department, bureau or other government entity, necessary for the commercial use,
storage, importation, exportation, transport or sale of a Product in the United
States. Pricing and reimbursement approvals shall be deemed to be included in
the foregoing definition to the extent applicable, in which case Ivivi shall
make commercially reasonable efforts to obtain such approvals.

                                    ARTICLE 2
                      APPOINTMENT AS EXCLUSIVE DISTRIBUTOR

         2.1 SCOPE.

                  (a) Ivivi grants to Allergan and its Affiliates the exclusive
(even as to Ivivi) right to directly and indirectly through others, market, sell
and distribute the Product in the Field in the Territory. Notwithstanding the
foregoing, Allergan shall market, sell and distribute the Product only in the
"MARKETING TERRITORY" initially defined as those countries and jurisdictions set
forth in SCHEDULE C-1 hereto but also including additional countries and
jurisdictions as expanded in accordance with this Agreement.

                  (b) In the event that Allergan wishes to market, sell or
distribute the Product in any other country or jurisdiction, it shall so notify
Ivivi (the "ALLERGAN NOTIFICATION") at least forty-five (45) days prior to
commencing such activity in such country or jurisdiction. Unless Ivivi provides
Allergan a written opinion of mutually agreed upon counsel, during such
forty-five (45) day period after the Allergan Notification, that Regulatory
Approval of the Product must be obtained in such country or jurisdiction in
order to market, sell or distribute the Product, then such country or
jurisdiction shall be deemed to be expressly included in the Marketing
Territory. If Ivivi delivers such written opinion to Allergan with respect to
any country or jurisdiction, then Ivivi shall then use commercially reasonable
efforts to obtain all approvals necessary to market, sell and distribute the
Product in such country or jurisdiction as soon as possible, and in any event no
later than one hundred eighty (180) days from the date of the Allergan
Notification (a "DUE DATE"). If Ivivi has diligently pursued and made
commercially reasonable efforts to obtain the necessary approvals but such
approval is not obtained on or prior to the applicable Due Date through no
fault, action or inaction of Ivivi, then the parties shall negotiate in good
faith to determine a mutually acceptable extension of the Due Date. Each such
country or jurisdiction shall be deemed to be expressly included in the
Marketing Territory on the date the approvals have been obtained. For purposes
of this Agreement, if a party is required to obtain or provide a written opinion
of mutually agreed upon counsel, the other party shall not unreasonably withhold
consent or agreement with respect to the selection of such counsel.

                  (c) Within forty-five (45) days of the Effective Date, Ivivi
shall provide a written opinion of mutually agreed upon counsel if Regulatory
Approval of the Product must be obtained in the countries or jurisdictions set
forth in SCHEDULE C-2 in order to market, sell or distribute the Product. Unless
Ivivi provides Allergan a written opinion of mutually agreed upon counsel within
such forty-five (45) day period with respect to any such country or jurisdiction
set forth on SCHEDULE C-2, then such country or jurisdiction shall be deemed to
be expressly included in the Marketing Territory. If Ivivi delivers such written
opinion to Allergan within such forty-five (45) day period with respect to any

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country or jurisdiction set forth on SCHEDULE C-2, then Ivivi shall use
commercially reasonable efforts to obtain all necessary approvals to market,
sell and distribute the Product in such country or jurisdiction as soon as
possible, and in any event no later than one hundred eighty (180) days from the
Effective Date (the "C-2 DUE DATE"). If Ivivi has diligently pursued and made
commercially reasonable efforts to obtain the necessary approvals but such
approval is not obtained on or prior to such C-2 Due Date through no fault,
action or inaction of Ivivi, then the parties shall negotiate in good faith to
determine a mutually acceptable extension of the C-2 Due Date. Each such country
or jurisdiction shall be deemed to be expressly included in the Marketing
Territory on the date the approvals have been obtained.

                  (d) Ivivi shall keep Allergan informed and consult with
Allergan of all activities related to obtaining any and all such approvals and
reasonably cooperate and take such actions as Allergan may request with respect
thereto. Ivivi shall promptly notify Allergan upon attaining such approvals.

                  (e) If (i) Allergan is required by law to discontinue or, in
the written opinion of mutually agreed upon counsel retained by Allergan, should
discontinue the marketing, sale or distribution of the Product in any
jurisdiction because of a reason related to the Product or (ii) Ivivi provides
Allergan an opinion of mutually agreed upon counsel stating that Allergan should
discontinue the marketing, sale or distribution of the Product in any
jurisdiction because of problems with Regulatory Approvals (any such
jurisdiction pursuant to (i) or (ii), an "EXCLUDED JURISDICTION"), then
effective thirty (30) days after such determination by Allergan or the receipt
by Allergan of the written opinion referenced in clause (ii), as applicable, and
for such time as Allergan is required to discontinue or, in the written opinion
of mutually agreed upon counsel, should discontinue the marketing, sale or
distribution of the Product in the Excluded Jurisdiction, Allergan shall not
market, sell and distribute the Product in such Excluded Jurisdiction; provided,
however, that if Allergan engaged in marketing, sale of distribution activities
in the Excluded Jurisdictions at the time it discontinues such activities then
Allergan shall be permitted to continue such activities for a reasonable period
of time in order to wind down its activities and Ivivi shall compensate Allergan
for the loss of such territory and the costs associated with discontinuing its
operations. Without limiting the foregoing, in the event that the United States
or any country of the European Union becomes an Excluded Jurisdiction pursuant
hereto, then Ivivi shall promptly pay to Allergan, in the case of the inclusion
of [*] as an Excluded Jurisdiction, [*], and, in the case of the inclusion of
[*] as an Excluded Jurisdiction, [*]; provided however that, if the inclusion of
[*] as an Excluded Jurisdiction is (A) due to a change in the regulatory
requirements of such country and not due to any fault or action or inaction of
Ivivi or (B) due to the refusal of such country to adopt, or the de-adoption by
such country of, Council Directive 93-42-EEC (Medical Device Directive), then
Ivivi shall pay to Allergan, in lieu of the [*] referenced above, an amount
equal to [*]. The inclusion of a country as an Excluded Jurisdiction pursuant to
this section (because of problems with Regulatory Approvals), which inclusion is
not due to any fault involving action or inaction of Ivivi, shall not be deemed
to be a breach of this Agreement so long as Ivivi is continuing to make
commercially reasonable efforts to correct such inclusion if the country being
included as an Excluded Jurisdiction is [*].

                  (f) In the event that Allergan wishes to market, sell or
distribute the Product in any country or jurisdiction not set forth in SCHEDULES
C-1 and C-2 (provided, however that the countries indicated with an asterisks on
SCHEDULE C-2 shall be deemed not a part of SCHEDULE C-2 for purposes of this
SECTION 2.1(f)) and provides the Allergan Notification in accordance with
SECTION 2.1(b) above, if (i) during the forty-five (45) day period after the

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date of the Allergan Notification, Ivivi provides Allergan a written opinion of
mutually agreed upon counsel that the marketing, sale and distribution of the
Product in such country would infringe third-party intellectual property rights
in such country or jurisdiction and would result in a significant likelihood of
a lawsuit being brought against Ivivi or Allergan or the other persons who may
be indemnified pursuant to ARTICLE 14 hereof and (ii) Allergan still wishes to
market, sell and distribute the Product in that country or jurisdiction despite
such written opinion of mutually agreed upon counsel, then Ivivi shall use
reasonable commercial efforts to obtain a license for, or re-design the Product
to be sold in such country or jurisdiction so as not to infringe, such
intellectual property rights. If Ivivi cannot obtain an appropriate license or
re-design the Product as necessary and Allergan still elects to market, sell and
distribute the Product in such country or jurisdiction, then any indemnification
to be provided to Allergan by Ivivi pursuant to ARTICLE 14 with respect to any
lawsuit arising out of the marketing, sale and distribution of the Product by
Allergan in such country shall be borne equally by Ivivi and Allergan. If Ivivi
cannot obtain or maintain appropriate Intellectual Property protection for the
Product, or cannot obtain an appropriate license or re-design the Product as
necessary so as not to infringe third-party patents in such country or
jurisdiction, in any country or jurisdiction in the Marketing Territory or in
which Allergan has a good faith intention of marketing and selling the Product,
then the royalties that would otherwise be payable under this Agreement with
respect to such country or jurisdiction shall be reduced by [*].

                  2.2 EXCLUSIVITY. Ivivi represents and warrants to Allergan
that Ivivi is the sole and exclusive owner of all rights related to the Product
and that it has not entered into any other agreements, written or oral, with any
third party permitting the sale or distribution of Product in the Field in the
Territory, and covenants and agrees that during the term of this Agreement,
Ivivi will not enter into any such agreement or itself sell or distribute the
Product or any substantially similar product in the Field in the Territory.
Allergan represents and warrants to Ivivi that neither Allergan nor its
Affiliates presently manufactures, markets, sells, distributes, promotes,
exploits or licenses any pulsed electromagnetic field product for post-operative
use in the Field. Furthermore, Allergan agrees on behalf of itself and its
Affiliates that, in the event Allergan or any of its Affiliates wishes to market
or sell any pulsed electromagnetic field product for post-operative use in the
Field that directly competes with the Product for a particular indication or
therapeutic use in the Field in a particular jurisdiction, which product is
developed by a party other than Ivivi or its Affiliates (a "COMPETING PRODUCT"),
Allergan shall notify Ivivi (the "COMPETING PRODUCT NOTICE"). [*] In no event
shall Allergan be obligated to disclose nonpublic information regarding a
Competing Product to Ivivi.

                  2.3 SUBDISTRIBUTORS AND SUBAGENTS. Allergan may appoint
subdistributors or subagents for distribution of the Product in the Territory.
Such subdistributors or subagents may include Allergan Affiliates and Affiliated
Parties.

                  2.4 PRICING AND REIMBURSEMENT APPROVALS. Allergan acknowledges
and agrees that Ivivi makes no representation that Ivivi or the Product has any
approvals necessary for reimbursement by third-party payors (such as health
insurance carriers), [*].

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                                    ARTICLE 3
                                     LICENSE

         3.1 LICENSE. Subject to the terms of this Agreement, Ivivi hereby
grants to Allergan and its Affiliates the following license (the "LICENSE"):

                  (a) an exclusive (even as to Ivivi), worldwide license, with
the right to grant sublicenses to market, use, sell, import (and have imported),
export (and have exported), and distribute (and have distributed) the Product in
the Territory for use in the Field;

                  (b) an exclusive (even as to Ivivi), worldwide right and
license, with the right to grant sublicenses, to the Ivivi Intellectual Property
and to make or have made (and to the extent necessary to address safety,
regulatory or manufacturing issues, research, develop, modify or have modified)
the Product solely for distribution and sale in the Territory for use in the
Field pursuant to the terms of this Agreement; provided, however, that
Allergan's right and license described in this SECTION 3.1(b) shall only be
exercisable as set forth in SECTION 4.3 and SECTION15.3(b) of this Agreement and
shall be subject to the terms and conditions of SECTION 4.3 and SECTION 15.3(b);

                  (c) a non-exclusive, royalty-free right and license, with the
right to grant sublicenses to the Trademarks in connection with the marketing,
distribution, sale, support and packaging of the Product for use in the Field;
provided, however, that Allergan shall be permitted, in its sole discretion, to
rebrand and rename the Product in connection with the marketing, distribution
and sale of the Product, and Allergan shall be the sole and exclusive owner of
any such brand or name and all intellectual property rights therein, unless such
brand or name includes a Trademark; and

                  (d) an exclusive (even as to Ivivi), royalty-free right and
license, with the right to grant sublicenses to use, perform, modify, create
derivative works of, copy, display, reproduce and distribute any and all
documentation, data, labels, inserts and other information on the Product in the
Territory for the purpose of the distribution, marketing or sale of the Product
in the Field.

         3.2 SUBLICENSES. Allergan shall have the right to grant sublicenses
under the License to any third party.

         3.3 GOODWILL. All goodwill accruing as a result of Allergan's use of
the Trademarks shall belong and accrue to Ivivi.

                                    ARTICLE 4
                          SUPPLY AND ORDERS FOR PRODUCT

         4.1 SUPPLY OF PRODUCT. Subject to the terms of this Agreement, Ivivi
agrees to manufacture and supply Allergan with quantities of the Product, as
requested by Allergan from time to time, for use in the Field in the Territory.
Ivivi may meet its obligations to supply the Product to Allergan hereunder
either directly, or indirectly by contracting with a manufacturer of its
choosing, provided that at all times Ivivi shall be fully responsible for the
actions and inactions of such contract manufacturer. Within ninety (90) days

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after Allergan has purchased more than [*] in the aggregate pursuant to this
Agreement, Ivivi agrees to (or will cause ADM to) obtain and qualify a
secondary, third-party source ("SECONDARY MANUFACTURER") for the manufacture of
the Product, and Ivivi agrees to continuously enable and maintain such Secondary
Manufacturer throughout the term of this Agreement and continuously update such
manufacturer with any alterations, modifications or changes in its process for
manufacturing the Product.

         4.2 PURCHASE OF PRODUCT.

                  (a) FORECASTS. At the beginning of each calendar month during
the term of this Agreement, Allergan shall provide Ivivi with a non-binding,
good faith written forecast of Allergan's expected requirements for Product
during the following twelve (12) months (the "FORECAST"). In no event shall
Allergan be obligated to purchase or have any liability in respect of the
quantities of Product set forth in any such Forecast. In the event that
Allergan's orders in any month exceed the amount forecast for such month in the
most recent Forecast, Ivivi shall use commercially reasonable efforts to supply
such amounts, but shall not be in breach of this Agreement for failure to supply
such excess.

                  (b) ORDERS. Allergan shall place any binding orders for Units
by written or electronic purchase order (or by any other means agreed to by the
parties) to Ivivi. Ivivi shall acknowledge and accept any Allergan purchase
order in writing within ten (10) days of receipt; provided, however, that Ivivi
must accept any Allergan purchase order equal to or less than the amount set
forth in the leading three (3) months of the Forecast. Any order to which Ivivi
does not respond to within such ten (10) days shall be deemed to have been
accepted. All such purchase orders shall be irrevocable. Purchase orders shall
set forth the desired date of delivery with respect to the Units ordered and
shall be placed at least thirty (30) days prior to such desired date of
delivery. All Units ordered by Allergan under this Agreement shall be delivered
on or before the delivery date set forth in the purchase order. Ivivi will use
commercially reasonable efforts to accommodate any orders for the Products
exceeding the leading three (3) months of such Forecast, and if Ivivi expects to
be unable to fulfill the excess portion of any such order within the time frame
requested, then Ivivi shall so notify Allergan within ten (10) days of receipt
of such order and the parties will work together to agree upon an alternative
delivery schedule for such excess portion of such order. Upon delivery to
Allergan, the expiration dating on any Unit shall be no less than [*].

                  (c) ALLOCATION. In the event of a Supply Problem, Ivivi shall
allocate the resources available to it first to Allergan and all Product ordered
by Allergan prior to any allocation of its resources to products or services to
be delivered to any other person or entity. For purposes of this SECTION 4.2(c),
"SUPPLY PROBLEM" shall mean Ivivi's inability or failure to supply at least [*]
of the Units ordered by Allergan [*], which Units conform to the Specifications
and other terms and conditions of this Agreement, and in compliance with the
delivery periods set forth in the purchase orders submitted by Allergan in
accordance with SECTION 4.2(b). The operation of this provision shall not excuse
Ivivi in any way from the minimum supply requirements set forth in this
Agreement. Any supply by Ivivi of the Product pursuant to this provision shall
not excuse Ivivi for its Failure to Supply.

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                  (d) SHIPMENT. Ivivi shall ship the Product, in reasonable
commercial quantities, from Northvale, New Jersey to Allergan's designated
location (the "SHIPPING POINT"), and title and risk of loss shall pass to
Allergan upon delivery to the Shipping Point. [*]. The parties will cooperate to
obtain the best commercial rates for such shipping costs. All Product delivered
by Ivivi shall be suitably packed for surface or air shipment, in Allergan's
sole discretion, in Ivivi's standard shipping cartons, marked for shipment to
such Allergan location as Allergan may designate. Ivivi shall ship all Units in
accordance with the instructions specified in Allergan's purchase orders; in the
absence of such instructions, Ivivi will follow its standard protocol. A
Certificate of Analysis ("COA"), as exemplified in EXHIBIT A, specific to
testing of each lot/batch, must accompany each shipment. Ivivi shall maintain a
copy of each such COA in compliance with current good manufacturing practices
("CGMP"). Ivivi shall provide a duplicate copy of the COA to Allergan, upon
Allergan's request, within forty-eight (48) hours of such request.

                  (e) INSPECTION AND ACCEPTANCE. Allergan shall have the right,
at its sole discretion, to inspect each and every shipment of the Product.
Allergan shall have [*] days from receipt of a shipment of Units to inspect the
shipment. Allergan may reject a shipment (or portion thereof) of Units if any
Units contained therein exhibits any damage or fails to conform to the
Specifications by providing Ivivi written notice of such rejection. Allergan may
then return the Units to Ivivi, freight paid by Ivivi. Upon receipt of the
damaged or nonconforming Units, Ivivi will credit Allergan for the cost of
returning the Units, and Allergan, in its sole discretion, shall have the option
of (i) terminating the applicable portion of the applicable purchase order
thereof without penalty and any failure to meet a forecasted quantity shall be
excused for the corresponding time period; or (ii) require Ivivi to replace such
Units promptly at no additional cost to Allergan and pay for the transportation
costs. In no event shall the inspection and acceptance of any Unit pursuant to
this SECTION 4.2(e), or the payment for such Unit by Allergan, in any way impair
or reduce Allergan's rights by law or under this Agreement.

         4.3 FAILURE TO SUPPLY. In the event that Ivivi shall be unable or
unwilling or shall otherwise fail to supply at least [*], of the Product
conforming to the Specifications and other terms and conditions of this
Agreement as Allergan shall order [*] and in compliance with the delivery
periods set forth in the purchase orders submitted by Allergan in accordance
with SECTION 4.2(b) hereof (any such failure hereinafter referred to as a
"FAILURE TO SUPPLY"), then Ivivi shall take prompt action to procure an
alternate Product manufacturer and shall take all necessary and reasonable steps
to enable such alternate Product manufacturer to produce the Product (and
provide Allergan written confirmation thereof) (such action and steps to be
collectively referred to herein as the "CORRECTIVE ACTION").

         In the event that the Failure to Supply is based on Ivivi's failure to
meet (a) [*] and Ivivi (i) fails to take the Corrective Action or is unable to
procure and enable an alternate Product manufacturer to produce the Product such
that the alternate Product manufacturer shall have begun production of the
Product no later than the date which is [*] after written notice from Allergan
(and provide Allergan written confirmation thereof) and (ii) has not provided
written notice to Allergan within [*] days of the Failure to Supply of its

                                       10
<PAGE>

intent to deliver all Units that had been ordered but not supplied, and actually
delivers all such ordered but not supplied Units within [*] days of such Failure
to Supply, or (b) [*] and Ivivi fails to take the Corrective Action or is unable
to procure and enable an alternate Product manufacturer to produce the Product
within [*] of written notice from Allergan (and provide Allergan written
confirmation thereof), then Allergan shall have the right to exercise the
license rights granted in SECTION 3.1(b) of this Agreement (the date such right
becomes exercisable, the "ALLERGAN MANUFACTURING LICENSE COMMENCEMENT DATE") and
to use the information described in SECTION 4.4, and, at Allergan's sole
discretion, Allergan may continue to use its rights thereunder until such time
as (x) Ivivi demonstrates to Allergan's reasonable satisfaction that Ivivi is
able to fully resume its supply obligations hereunder, (y) Ivivi pays all costs
and expenses associated with resuming such manufacture, including, without
limitation, paying all costs and expenses associated with the termination of and
transition from Allergan's then existing supplier, and (z) Ivivi actually fully
resumes its supply obligations hereunder (such time period from the Allergan
Manufacturing License Commencement Date to the end date described in the
immediately preceding clauses (x) through (z), a "MANUFACTURING LICENSE
PERIOD"), in which case, the Manufacturing License Period shall be suspended and
Allergan shall thereafter purchase Product exclusively from Ivivi in accordance
with the terms of this Agreement.

         If Allergan engages a third party to produce or manufacture the Product
during the Manufacturing License Period, then, in negotiating a reasonable
commercial agreement with such third-party supplier, Allergan shall make a
reasonable good faith effort to provide for reasonable termination costs so long
as obtaining such termination provisions does not cause the price Allergan pays
for the Product to exceed the Transfer Price Allergan would have otherwise paid
Ivivi hereunder. If the price Allergan pays for a Unit of Product or Allergan's
cost to produce a Unit of Product (the "PRODUCT UNIT REPLACEMENT COST") is
greater than the then applicable Transfer Price, which Allergan would otherwise
have paid Ivivi hereunder for such Unit of Product (the "PRODUCT PRICE
DIFFERENCE"), then Allergan shall deduct such Product Price Difference from the
royalties required by SECTION 5.4 during the Manufacturing License Period (the
royalties, less such deduction if applicable, are the "MANUFACTURING LICENSE
COMPENSATION").

         Ivivi agrees to provide reasonable assistance to enable such
third-party manufacturer to produce Units, including but not limited to,
providing technical and regulatory assistance and to the extent reasonably
required or requested by Allergan, transferring to Allergan any approvals,
licenses, intellectual property or any other rights or information. Furthermore,
Ivivi agrees to take reasonable actions to (i) provide or have provided by its
suppliers or otherwise all components used in the Product, such as raw
materials, and, if possible, make available equipment to enable the production
of Units (as used herein and in SECTION 4.4 below, "PRODUCE" or "PRODUCTION"
shall include all aspects of creating the Product for commercial distribution
and sale, including, but not limited to, manufacture, fill, test and package),
and (ii) upon the written request of Allergan, provide reasonable assistance to
Allergan to locate a suitable manufacturing facility for production of the
Product.

         In the event Allergan exercises the license rights granted in SECTION
3.1(b) of this Agreement during the period commencing on the Effective Date and
ending on the third anniversary of the First Commercial Sale, then Ivivi shall
promptly repay to Allergan a portion of all amounts paid by Allergan pursuant to
SECTION 5.6 as follows: [*]; and no additional amounts shall be due or payable
to Ivivi pursuant to such SECTION 5.6.

                                       11
<PAGE>

         Any resumption by Ivivi will be subject to the then existing
obligations, if any, to the alternate supplier, including, but not limited to,
binding orders and minimum quantities. Allergan agrees that the occurrence of
and failure to correct a Failure to Supply shall not be deemed a breach of this
Agreement so long as Ivivi is continuing to make reasonable commercial efforts
to correct such Failure to Supply and such failure is not the result of reckless
or intentional action or inaction by Ivivi.

         4.4 ESCROW OF PRODUCTION INFORMATION. Within ninety (90) days after
execution of this Agreement and during the term of this Agreement (after such
ninety (90) day period), Ivivi shall, at its expense, place and maintain with an
escrow agent mutually acceptable to Ivivi and Allergan (the "ESCROW AGENT"),
pursuant to an agreement acceptable to Ivivi and Allergan, all information
related to the manufacture or production of the Product including, without
limitation, a description of Ivivi's (or the Product manufacturer's) process,
raw materials and equipment for the manufacture or production of the Product in
sufficiently clear and detailed terms that it can be readily followed and
carried out by a trained scientist or engineer to make the Product in the manner
Ivivi reasonably considers most efficient (the "ESCROW DEPOSIT"). The Escrow
Deposit shall provide for the appropriate treatment of the Confidential
Information of Ivivi. In the event Ivivi (or the Product manufacturer) alters,
modifies or changes its process for manufacturing the Product, Ivivi shall amend
the description in escrow to include such alteration, modification or change.
The information held in escrow pursuant to this SECTION 4.4, shall be available:
(i) to Allergan or its designee only during Manufacturing License Periods and
(ii) to any independent consultant engaged by Allergan who is reasonably
acceptable to Ivivi (who shall be bound under a written confidentiality
agreement reasonably acceptable to Ivivi) to audit compliance with the
foregoing. Ivivi represents and warrants that the information it places into
escrow in connection with this Agreement and the Escrow Agreement describes the
manner of production which is most current and further is accurate, complete and
sufficiently clear and detailed to enable a trained scientist or engineer to
commercially produce the applicable Product.

         4.5 PRODUCT, PACKAGING AND LABELING. Ivivi shall be responsible for
Product packaging, labeling, instructions for use, and any necessary
sterilization of Product purchased under this Agreement. Subject to SECTION
6.1(c), Allergan shall have the right to determine the appearance of the Product
and the appearance and text of all package labeling used in connection with the
Product. Ivivi shall deliver the text of the proposed packaging, labeling and
instructions for use to Allergan for its review and comment prior to printing.
In the event Allergan requests changes to the appearance of the Product or the
appearance or text of the package or labeling, which changes are not required
pursuant to any regulatory or legal requirements, and the per unit cost of the
Product, packaging and labeling the Product increases as a direct result of the
changes requested by Allergan by more than [*] of the then current unit cost of
packaging and labeling the Product, then Ivivi shall notify Allergan of such
additional costs, and Allergan shall pay such increase in costs if it notifies
Ivivi in writing that it still wants the changes to be made. Notwithstanding the
foregoing, Ivivi shall prepare packaging, labeling and instructions for use in
all foreign languages that Allergan reasonably requests at Ivivi's sole cost and
expense. Allergan shall, with the assistance of Ivivi as described herein,
develop and use its own sales and promotional literature in connection with its
distribution of the Product.

                                       12
<PAGE>

                                    ARTICLE 5
                               PRICES AND PAYMENTS

         5.1 PRICE. The transfer price (the "TRANSFER PRICE") of all Product
shipped by Ivivi to Allergan during the term of this Agreement shall be as set
forth on SCHEDULE A hereto. Such prices do not include any sales, excise, use,
value added or other government taxes that may be applicable to the purchase of
the Product, which will be the responsibility of Allergan (except for taxes
based on Ivivi's income, including federal, state and local taxes). When Ivivi
has the legal obligation to collect and/or pay such taxes, the appropriate
amount shall be added to Allergan's invoice and paid by Allergan to Ivivi unless
Allergan provides Ivivi with a valid tax exemption certificate authorized by the
appropriate governmental taxing authority. [*].

         5.2 INVOICING; PAYMENT. Ivivi shall submit an invoice to Allergan for
each shipment of Product ordered by Allergan under this Agreement. Each invoice
shall be due and payable net [*] days from the later of the date of invoice or
receipt of the invoice by Allergan. All invoices shall be sent to Allergan's
address for notice purposes, without regard to the actual shipping address for
the Product. Each such invoice shall state Allergan's aggregate and unit
purchase price for the Product in the relevant shipment, plus any freight,
incident to the purchase or shipment initially paid by Ivivi and to be borne by
Allergan hereunder.

         5.3 RESALE PRICES. Allergan may resell the Product at such prices, as
Allergan in its sole discretion, shall determine.

         5.4 ROYALTIES. No later than [*] days after the end of each Fiscal
Quarter, Allergan shall provide Ivivi a report summarizing sales activity for
the Product for the previous Fiscal Quarter and pay Ivivi a royalty equal to the
greater of (a) [*] of (i) Net Sales of the Product during such Fiscal Quarter
minus (ii) all out-of-pocket costs (as multiplied by the Factor, if applicable)
specifically set forth in this Agreement as deductible from Net Sales, including
costs of approvals obtained by Allergan and other fees and expenses set forth in
SECTION 5.11, or (b) the product of [*] multiplied by the number of Units sold
and included in the determination of Net Sales of the Product during such Fiscal
Quarter.

         5.5 MINIMUM SALES AND ROYALTIES. Allergan will provide orders totaling
[*]. In addition, Allergan will pay minimum royalties as set forth in SCHEDULE
D. Notwithstanding any other provisions hereof, the sole remedy of Ivivi for the
inability or failure of Allergan to meet the minimum requirements set forth in
this section (or determined as described in SCHEDULE D) shall be termination of
this Agreement pursuant to SECTION 15.2(d) hereof.

         5.6 INITIAL AND MILESTONE PAYMENTS. In addition to the foregoing,
Allergan shall pay to Ivivi: (a) $500,000 within five (5) days following the
execution of this Agreement, (b) [*] within thirty (30) days after the First
Commercial Sale of the Product by Allergan in the U.S. to a person who is not an
Affiliate or subcontractor or sublicensee of Allergan and (c) [*] within thirty
(30) days after the First Commercial Sale of the Product by Allergan in the EU
to a person who is not an Affiliate or subcontractor or sublicensee of Allergan.
"FIRST COMMERCIAL SALE" means the first time Allergan sells at least [*] in the
aggregate to third parties (which sales must include sales of at least [*]) and
delivers the Product to such third parties. The amounts payable pursuant to this
SECTION 5.6 shall not be counted against the royalty payments required by
SECTION 5.4.

                                       13
<PAGE>

         5.7 NEW INDICATION. Ivivi shall, at its own expense, conduct studies of
the Product in [*] to determine the safety and effectiveness of the Product in
treating [*] ("NEW INDICATION STUDIES"). Ivivi shall consult with Allergan
regarding the protocols, investigators, investigator sites, case report forms,
data captured, publications, rights to publications and information gathering
requirements for the New Indication Studies. Ivivi shall promptly provide to
Allergan all results of the New Indication Studies, including without limitation
any and all preliminary results, adverse event reports and the like. Upon
completion of such study, Ivivi shall prepare a written report of the results of
the New Indication Studies which shall be in a form and contain such information
as reasonably requested by Allergan regarding the use of the Product for the
treatment and prevention of [*] (the "NEW INDICATION"). Allergan shall have
royalty-free, unlimited use in the Field of the New Indication Studies and any
data collected thereunder. Thereafter, upon Allergan's request, Ivivi shall, at
its own expense (other than the filing fees referenced below), make commercially
reasonable efforts to obtain FDA Approval for the New Indication in the United
States. For purposes of this SECTION 5.7, "FDA APPROVAL" shall mean FDA
premarket approval to commercially distribute a product in the United States for
use in humans, unless Allergan has, at its reasonable discretion, requested that
Ivivi pursue 510(k) clearance from the FDA rather than premarket approval, in
which case the term "FDA Approval" shall mean such 510(k) clearance. Allergan
shall pay the filing fees directly related to obtaining FDA Approval for the New
Indication. All matters, actions and activities related to the FDA Approval of
the New Indication including, without limitation, the specifications and design
of the Product shall be reviewed, decided and approved by the New Indication
Steering Committee (as defined below). The New Indication Steering Committee,
consisting of two (2) representatives from Allergan and two (2) representatives
from Ivivi, shall meet periodically and at least quarterly at Allergan's offices
in Irvine, California (or such other location as the parties may mutually agree)
to review progress and to resolve issues. Ivivi shall provide Allergan with all
information related to the FDA Approval of the New Indication including, without
limitation, prior notice of any communications, applications or other activities
and any other types of information requested by Allergan. The New Indication
Steering Committee may take action only by the unanimous written consent of all
members. If an issue remains unresolved after consideration by the New
Indication Steering Committee, any New Indication Steering Committee member may
escalate it to the Chief Executive Officer of Ivivi and a Vice President of
Allergan's breast aesthetics business for resolution. If the issue remains
unresolved thirty (30) days thereafter, then the dispute shall be settled by
arbitration (which arbitration shall be binding and enforceable in any court of
competent jurisdiction for the purposes of the Agreement only) as follows: (a)
the parties shall jointly select one (1) independent arbitrator with expertise
in medical device development within ten (10) days, (b) the parties shall
cooperate in good faith in the selection of the arbitrator but, if they fail to
do so within the ten (10) day period, either party may request appointment of
the arbitrator by the American Arbitration Association ("AAA"), (c) each party
will have five (5) day(s) to present its case (presentation shall be made on a
date selected by the arbitrator which shall be at least ten (10) and no more
than thirty (30) days after selection of the arbitrator), (d) the arbitrator
shall have twenty (20) days from completion of such presentation to render its
decision, and (e) such arbitration shall be informal and need not conform to AAA
or other established procedures. Unless otherwise agreed to by the parties,
arbitration shall take place in Irvine, California and arbitrator fees will be
shared equally by the parties.

                                       14
<PAGE>

         5.8 CURRENCY OF PAYMENTS. All payments under this Agreement will be
made in U.S. Dollars by electronic funds transfer to such bank account as the
party receiving such funds may designate from time to time, or by check.

         5.9 BOOKS, RECORDS AND AUDIT RIGHTS. Each party and its respective
Affiliates shall maintain accurate books and records in accordance with GAAP
regarding sales or production of the Product by such party (or the Product
manufacturer) and its Affiliates in sufficient detail to enable Net Sales or
Manufacturing Costs of the Product to be determined and to otherwise enable each
party to monitor compliance by the other with the terms of this Agreement. Each
party shall maintain such books and records for a period of three (3) years
following the applicable activity. Each party shall have the right to inspect
such books and records for the purpose of compliance with this Agreement,
including verification of Net Sales and Manufacturing Costs, at reasonable
intervals (but no more frequently than once in any twelve (12) month period) and
upon reasonable prior notice. Such inspections shall be performed by an
independent certified public accountant, recognized nationally in the United
States, selected by the inspecting party and approved by the party being
inspected, which approval shall not be unreasonably withheld. All expenses of
such inspection shall be borne by the inspecting party; provided, however, that
if such inspection shall reveal an discrepancy (an underpayment in the case of
Net Sales and an overcharging in the case of Manufacturing Costs) of more than
[*], then the party being inspected shall pay the reasonable fees charged by
such independent auditor in connection with such inspection. Any deficiencies
(in the case of Net Sales) or overpayment (in the case of Manufacturing Costs)
shall be immediately due and payable together with interest at the rate of the
lesser of, [*] per annum, or the maximum rate permitted by law, from the date or
dates such amounts should have been paid (in the case of Net Sales) or were paid
(in the case of Manufacturing Costs). Any independent certified public
accountant engaged by a party shall sign a confidentiality agreement reasonably
acceptable to the other party prior to any audit and shall then have the right
to examine the records kept pursuant to this Agreement and report findings (but
not the underlying data) of the examination to the inspecting party as is
necessary to evidence that records were or were not maintained and used in
accordance with this Agreement.

         5.10 WITHHOLDING. Allergan shall be entitled to withhold from any
payment due to Ivivi under this Agreement any amounts assessed against Ivivi
that Allergan by law is required to pay to any government. Such withholding
shall decrease by an equivalent amount the payment due to Ivivi. In the event of
any withholding under this section, Allergan shall provide receipts of payment
of any withheld amounts or other documents reasonably available to Allergan.
Ivivi shall provide to Allergan any information or documents requested by
Allergan in conjunction with the subject matter noted above.

         5.11 DEDUCTIBLE COSTS. Allergan shall deduct from Net Sales (in
connection with the calculation of any royalties as provided in SECTION 5.4(a))
[*] (the "FACTOR") of [*].

                                       15
<PAGE>

         5.12 LATE PAYMENTS. Any amounts payable pursuant to this Agreement that
are not paid when due shall bear interest at the lesser of (i) [*] per annum or
(ii) the maximum rate permitted by law, from the date or dates such amounts
should have been paid.

                                    ARTICLE 6
                  ADDITIONAL RIGHTS AND OBLIGATIONS OF ALLERGAN

         6.1 SALES AND MARKETING.

                  (a) Allergan will make commercially reasonable efforts to
further the promotion, marketing, sale and other distribution of the Product in
the Marketing Territory in the Field.

                  (b) Allergan shall exclusively and in its sole discretion
determine the manner in which the Product is marketed, sold and distributed,
including without limitation, the methods of pricing, packaging, labeling and
identification, advertising, promoting, and collection and ownership of
customers' names. Except as set forth in SECTION 4.5, Allergan shall be
responsible for the preparation of sale and marketing materials for the
marketing and sale of the Product, including the adaptation and/or modification
of Ivivi's sales and marketing materials, as deemed appropriate by Allergan, to
reflect local culture or business practices and languages, and to reflect
Allergan as the exclusive distributor of the Product. However, Allergan and
Ivivi will meet no less than annually to review commercialization-related plans
and materials and Ivivi will cooperate with Allergan in the preparation of
Allergan's sales and marketing materials and may provide suggestions with
respect to such plans.

                  (c) Notwithstanding the foregoing, Ivivi shall have final
approval over all labels, labeling, indications and claims regarding the Product
and other matters that affect, or could reasonably affect, its Regulatory
Approvals for the Product and its rights in the Trademarks.

         6.2 PACKAGE LABELING AND OTHER PRODUCT RELATED MATERIALS. Subject to
SECTION 6.1(c), Allergan shall have the right to determine the appearance and
text of all package labeling used in connection with the Product. Allergan
shall, with the assistance of Ivivi, develop and use its own sales and
promotional literature in connection with its distribution of the Product.
Allergan may, at its own cost and expense, conduct any additional studies that
Allergan deems necessary to support the marketing of the Product. Ivivi shall
provide to Allergan any and all information and knowledge in Ivivi's possession
concerning Product, their qualities and uses, and techniques and methods of
marketing them, as will aid Allergan in improving the sales of the Product.
Allergan shall provide to Ivivi copies of all sales and promotional literature
(or an English translation thereof for those in other languages) and study
protocols it develops to Ivivi for review at least fourteen (14) days prior to
the first use thereof, and shall not use such materials if Ivivi raises a
reasonable objection based on the accuracy of such materials or the compliance
of such materials with the Regulatory Approvals, including the approved
instructions for use of such Product. Notwithstanding the foregoing, (i)
Allergan shall comply with Ivivi's reasonable requests regarding marking of the
packaging and other literature for all Product sold under this Agreement with
the patent and copyright marking and, if Allergan uses any of the Trademarks,
designation of such Trademarks as owned by Ivivi, and (ii) Allergan shall
designate in a manner as reasonably requested by Ivivi, so long as such request
is consistent with any applicable regulatory requirements, that "Ivivi" is the
designer of the Product. None of the foregoing shall relieve or limit Ivivi's
obligation to ensure that package labeling complies with applicable law.

                                       16
<PAGE>

         6.3 IMPORT APPROVALS. Allergan shall be responsible for obtaining all
import licenses and permits (other than regulatory approvals described in
ARTICLE 10) as may be required to import the Product into such countries as are
selected by Allergan in accordance with then prevailing laws and regulations of
such countries. All such filings and registrations of the Product shall be in
the name of Allergan, whenever feasible in accordance with prevailing laws and
regulations. Ivivi shall cooperate fully with Allergan in its efforts to obtain
any such approvals.

                                    ARTICLE 7
                   ADDITIONAL RIGHTS AND OBLIGATIONS OF IVIVI

         7.1 COMPLIANCE WITH LAWS; MANUFACTURING. Ivivi (and all third-party
manufacturers of the Product) shall comply in all material respects with all
laws, rules and regulations applicable to the manufacture, labeling and
packaging of the Product in the Marketing Territory, including maintaining
qualified manufacturing and quality facilities and/or procedures. Without
limiting the generality of the foregoing, Ivivi (and all third-party
manufacturers of the Product) shall implement such quality control systems and
procedures as shall be appropriate to (a) ensure compliance with the
requirements of the International Standards Organization ("ISO") and Quality
Systems Regulations ("QSR"), as applicable to Ivivi or such third-party
manufacturer as the manufacturer and supplier of the Product, and (b) place the
CE marks on the Product in accordance with applicable law. Furthermore, Ivivi
(and its third-party manufacturers of the Product) shall comply with all
processes dictated by approval processes and regulations in any country in which
the Product is approved for sale, including, but not limited to, FDA
manufacturing, storage and handling requirements, and other government
requirements. In addition, Ivivi shall allow reasonable access to its records,
manufacturing facilities, and its third-party manufacturers' manufacturing
facilities and records (if applicable) to allow any Government Heath Authority
to conduct full compliance audits or inspections relating to the Product.
Further, the parties shall make reasonable commercial efforts to, within sixty
(60) days following the Effective Date but in any event prior to the sale of any
Product to third parties, enter into a Quality Agreement in accordance with QSR
regulations which shall include, without limitation, a joint complaint
management process; storage and shipment conditions and controls; environmental,
temperature and humidity conditions and controls, as applicable; a requirement
to provide Allergan written documentation of Product compliance and monitoring
records demonstrating continuous compliance with Product storage and shipment in
accordance with Product labeling; and such other provisions as requested by
Allergan or required or suggested by regulatory guidance or Allergan World Wide
Quality Assurance requirements.

         7.2 TRAINING AND SUPPORT. Ivivi shall (a) assist, at no charge, in the
training of Allergan's sales personnel representing the Product with respect to
the promotion and use of the Product, which training shall take place during
normal business hours (i) once every [*] during the period commencing on the
Effective Date and ending on the [*] of the First Commercial Sale and (ii) once
every [*] thereafter; and (b) travel, at Allergan's sole cost and expense, with
Allergan's sales personnel to assist in problem solving, market needs
identification and general market development, in each case as may be reasonably
requested by Allergan.

                                       17
<PAGE>

         7.3 TECHNICAL SUPPORT. Ivivi shall be responsible for providing all
technical support for the Product at its sole expense. During the term of this
Agreement and any renewal terms, and for one (1) year thereafter, Ivivi shall,
at Ivivi's cost, be responsible for providing technical support to Allergan
technical support staff and users of the Product. During the term of this
Agreement and for one (1) year thereafter, Ivivi shall also provide technical
support training to Allergan technical support staff upon request, which
training shall take place during normal business hours (i) once every [*] during
the period commencing on the Effective Date and ending on the [*] of the First
Commercial Sale and (ii) once every [*] thereafter. In addition, Ivivi will
perform any technical programming or technical research and all other actions
related to correcting identified defects in the Product, which Allergan may
reasonably request from time to time, within a reasonable time free of charge to
Allergan.

         7.4 RESEARCH AND DEVELOPMENT. Ivivi will continue its product
development programs, at its own cost and expense, including providing on-going
research and development of the Product and Improvements of the Product.
Allergan will provide Ivivi feedback from Allergan's sales force with regard to
market needs and Ivivi will use commercially reasonable efforts to develop
product enhancements to meet these needs.

         7.5 PROSECUTION OF PATENTS. Ivivi agrees to, at its expense, prosecute,
or cause to be prosecuted to allowance or final rejection, and reasonably
maintain, in the Marketing Territory and such other countries as Allergan may
request from time to time, all Ivivi Intellectual Property related to the Field
for which a patent would be desirable. Ivivi shall pay all government fees
required to keep in force patents and applications therefor relating to the
Ivivi Intellectual Property and shall submit evidence to Allergan, upon request,
that said government fees have been timely paid. In the event that Ivivi decides
not to prosecute, not to pay a government fee due on, or otherwise to abandon, a
patent or application therefor relating to the Ivivi Intellectual Property in a
country in which it is required to do so, Ivivi shall send Allergan written
notice of said decision at least ninety (90) days in advance of the action or
payment due date. Allergan shall thereupon have the option to take over the
patent or application if such patent or application is in a country in which
Allergan has a good faith intention to market, sell or distribute the Product,
and Ivivi shall assign to Allergan all rights in such patent or application in
such jurisdiction. Whereupon Allergan shall pay the government fees, in which
event it may deduct the costs thereof from the amounts payable to Ivivi with
respect to sales of the Product in such country (or the EU, as a whole, in the
case of a member country in the EU).

         7.6 MARKETING SAMPLES. Ivivi will provide to Allergan, at no charge,
upon thirty (30) days prior notice, samples of the Product as may be requested
by Allergan, which shall not exceed [*] Units in any consecutive twelve (12)
month period. Allergan will provide such samples to its sales force and
customers at no charge.

         7.7 SALES LEADS. Ivivi shall forward to Allergan all leads for sales of
Product in the Territory.

         7.8 MANUFACTURING. In the event that Ivivi is not manufacturing the
Product and is using a third party to manufacture the Product (including without
limitation a related party or Affiliated Party), Ivivi shall obtain all rights
necessary from such third party to enable Allergan to exercise all of its rights
under this Agreement.

                                       18
<PAGE>

                                    ARTICLE 8
                               PRODUCT WARRANTIES

         8.1 WARRANTY. Ivivi warrants that all Product (a) are provided free and
clear of any liens and encumbrances of any kind, are of good material and
workmanship and will be free of defects in material and workmanship and conform
to the Specifications therefor, (b) comply with all applicable safety, health
and other laws, rules and regulations applicable to the Product in the United
States or EU, and the applicable laws, rules and regulations of any Marketing
Territory outside the U.S. and EU, (c) are safe and effective for all reasonably
foreseeable uses in the Field, and (d) not adulterated or misbranded as defined
in the Act.

         8.2 NON-CONFORMING PRODUCT. In the event that any Product purchased
hereunder fails to conform to the warranties set forth in SECTION 8.1, Ivivi
will be responsible for all damages, and, in addition to Allergan's other
remedies at law or in equity, Ivivi, at its option, must replace the defective
or non-conforming Product at its expense or fully refund the purchase price (and
related expenses, including, without limitation, shipping, insurance and other
transportation charges) incurred by Allergan.

         8.3 PRODUCT LIABILITY. Ivivi shall be responsible for all claims
related to the Product including, without limitation, all health related claims
from users of the Product; except to the extent that liability for such claims
is due to: (a) the gross negligence or willful misconduct of Allergan, (b)
material breach of this Agreement by Allergan, or (c) material breach of or
substantial noncompliance with any law or regulation (that Allergan is required
to comply with hereunder) by Allergan.

                                    ARTICLE 9
                         REPRESENTATIONS AND WARRANTIES

         9.1 IVIVI'S REPRESENTATIONS AND WARRANTIES. Ivivi hereby represents and
warrants to Allergan that as of the Effective Date and during the term of this
Agreement:

                  (a) Ivivi is a corporation duly organized, validly existing
and in good standing under the laws of New Jersey, and this Agreement has been
duly authorized by all necessary corporate action.

                  (b) Ivivi has all necessary corporate power and authority to
enter into this Agreement and to perform all of its obligations hereunder.

                  (c) This Agreement has been duly authorized, executed and
delivered by Ivivi and is the legal, valid and binding obligation of Ivivi,
enforceable against Ivivi in accordance with its terms.

                  (d) Neither the execution, delivery and performance by Ivivi
of this Agreement nor the consummation of the transactions contemplated hereby
violate or conflict with the charter documents of Ivivi, any material contract,
agreement or instrument to which Ivivi is a party or by which it or its
properties are bound, or any judgment, decree, order or award of any court,
governmental body or arbitrator by which Ivivi is bound, or any law, rule or
regulation applicable to Ivivi.

                                       19
<PAGE>

                  (e) Ivivi is the sole and exclusive owner of the Ivivi
Intellectual Property, including the Patents, the Trademarks and its
Confidential Information, free and clear of any security interests, claims,
encumbrances or charges of any kind, and has full right, power and authority to
enter into this Agreement and to grant to Allergan the rights granted and to be
granted hereunder.

                  (f) The rights and licenses granted under this Agreement do
not infringe any issued or published patent, copyright, trademark, license or
other intellectual property right of any third party and do not misappropriate
any trade secret of any third party.

                  (g) As of the Effective Date, there is no legal,
administrative, arbitration, or other proceeding, suit, claim or action of any
nature, judgment, decree, decision, injunction, writ or order pending or, to the
knowledge of Ivivi, threatened or contemplated by or against or involving Ivivi
or its shareholders, directors or officers (but only in their capacity as such),
Ivivi Intellectual Property, Ivivi Confidential Information or this Agreement,
whether at law or in equity, before or by any person, entity or governmental or
quasi-governmental, administrative or regulatory agency or any court. Ivivi
shall provide notice of any of the foregoing to the extent they involve the
Product, the Ivivi Intellectual Property, Ivivi Confidential Information or this
Agreement.

                  (h) All proprietary technical information and Ivivi
Intellectual Property that has not been patented has been kept confidential.

                  (i) Except for the Patents, Ivivi has not patented or applied
for patent protection on any of the technology it has used or proposes to use in
developing the Product.

                  (j) With respect to all regulatory filings to obtain
Regulatory Approvals, (i) the data and information in Ivivi's submissions were,
are and shall be free from fraud or material falsity; (ii) the Regulatory
Approvals have not been and will not be obtained either through bribery or the
payment of illegal gratuities, (iii) the data and information in Ivivi's
submissions were, are and shall be accurate and reliable for purposes of
supporting approval of the submissions, and (iv) the Regulatory Approvals shall
be obtained without illegal or unethical behavior of any kind.

                  (k) Ivivi is not under any obligations inconsistent with the
provisions of this Agreement.

                  (l) Ivivi's agreement with ADM allows Ivivi to terminate
exclusivity in the event that ADM refuses to match any such lower price, and
Ivivi agrees that it will not amend any agreement with ADM in any way, without
the prior written consent of Allergan, if such amendment may adversely affect
the timing of deliveries to Allergan or the price paid by Allergan for the
Product.

         9.2 ALLERGAN'S REPRESENTATIONS AND WARRANTIES. Allergan hereby
represents and warrants to Ivivi that as of the Effective Date and during the
term of this Agreement:

                  (a) Allergan is duly organized, validly existing and in good
standing under the laws of Delaware and this Agreement has been duly authorized
by all necessary corporate action.

                                       20
<PAGE>

                  (b) Allergan has all necessary corporate power and authority
to enter into this Agreement and to perform all of its obligations hereunder.

                  (c) This Agreement has been duly authorized, executed and
delivered by Allergan and is the legal, valid and binding obligation of
Allergan, enforceable against Allergan in accordance with its terms.

                  (d) Neither the execution, delivery and performance by
Allergan of this Agreement nor the consummation of the transactions contemplated
hereby violate or conflict with the charter documents of Allergan, any material
contract, agreement or instrument to which Allergan is a party or by which it or
its properties are bound, or any judgment, decree, order or award of any court,
governmental body or arbitrator by which Allergan is bound, or any law, rule or
regulation applicable to Allergan.

                                   ARTICLE 10
                             REGULATORY SUBMISSIONS

         10.1 MEDICAL DEVICE ESTABLISHMENT REGISTRATION. Ivivi shall maintain a
Medical Device Establishment Registration (as defined under the Act) as
manufacturer and Specifications developer for the Product, as required by law,
including without limitation those defined by 21 CFR Part 807. If Ivivi is not
the manufacturer of the Product and is using a third party to manufacture the
Product, then such third-party manufacturer shall maintain the Medical Device
Establishment Registration as required by law and the foregoing sentence and
Ivivi shall ensure compliance with such requirement. In any event, Ivivi shall
keep Allergan informed of, and obtain Allergan's prior written approval (which
shall not be unreasonably withheld) prior to, any modifications to the
manufacturing process and/or the specifications for the Product.

         10.2 REGULATORY APPROVALS. Ivivi shall be responsible, at its sole
expense, for all regulatory activities relating to the Product, including
obtaining and maintaining Regulatory Approvals and authorizations in the U.S.,
Canada, the EU (and any country therein) and in all other jurisdictions within
the Marketing Territory. Allergan shall have the right to consult with Ivivi on
the planning and development of all documentation provided with respect thereto.
Ivivi shall provide to Allergan for review and approval copies of any proposed
submission at least fourteen (14) days prior to such submission. All such
approvals shall be obtained in the name of Ivivi unless legally required
otherwise or if the parties agree that it is appropriate, in which case,
Allergan or its designee may hold such approval in trust for Ivivi, and on
termination of this Agreement shall transfer such approval to Ivivi or its
designee.

         10.3 MANUFACTURING COMPLIANCE. Ivivi represents and warrants to
Allergan that all Product manufactured and sold under this Agreement will have
been manufactured, labeled, packaged and sold to Allergan in accordance with the
Specifications and all applicable international federal, state and local laws
and regulations pertaining to medical devices including, but not limited to, the
Act and GMP/QSR Regulations. Ivivi represents and warrants to Allergan that
Ivivi's manufacturing facility is in compliance with all GMP/QSR Regulations.
Immediately upon execution of this Agreement, Ivivi shall make commercially
reasonable efforts to comply with all applicable ISO requirements, including ISO
13486:2003, 13495:2004 and 14971.A1:2003. In addition, in connection with
obtaining Canadian Marketing Approval, or immediately after obtaining such

                                       21
<PAGE>

approval, Ivivi shall make commercially reasonable efforts to comply with
Canadian medical device regulations (CMDR) and shall obtain all approvals and
consents required to mark the Product with a valid CMDCAS certificate. Ivivi
shall make commercially reasonable efforts to obtain all approvals and consents
required to mark the Product with the CE marks in connection with obtaining EU
Marketing Approval, or immediately after obtaining such approval.

         10.4 REMEDIAL ACTIONS. Each party will notify the other immediately,
and promptly confirm such notice in writing, if it obtains information
indicating that any of the Product may be subject to any recall, corrective
action or other regulatory action (other than a corrective and preventive action
("CAPA") under the Act) taken either by virtue of applicable federal, state,
foreign or other law or regulation or good business judgment (a "REMEDIAL
ACTION"). The parties will assist each other in gathering and evaluating such
information as is necessary to determine the necessity of conducting Remedial
Action; provided that Allergan shall have sole responsibility for collecting
information from its customers, including customer complaints. Allergan will
determine whether to commence any Remedial Action with respect to the Product.
Each party will maintain adequate records to permit the parties to trace the
manufacture of the Product and the distribution and use of the Product. In the
event Allergan determines that any Remedial Action with respect to the Product
should be commenced, or Remedial Action is required by any governmental
authority having jurisdiction over the matter, Allergan will control and
coordinate all efforts necessary to conduct such Remedial Action. If Allergan
conducts any Remedial Action related to the Product, Ivivi, at Allergan's
option, will either issue a credit to Allergan or reimburse Allergan for the
Transfer Prices of all Units recalled in such Remedial Action and the other
reasonable costs of conducting such Remedial Action. Ivivi shall have sole
responsibility for handling any CAPAs in a manner reasonably requested by
Allergan. Allergan shall cooperate with Ivivi to the extent reasonably requested
by Ivivi in handling any CAPA.

         10.5 COSTS OF REMEDIAL ACTION. The cost and expense of a Remedial
Action shall be borne and paid solely by Ivivi.

         10.6 ADVERSE EVENT REPORTING. The parties shall report to each other
all information necessary to make timely reports as required by any governmental
regulatory agency throughout the world regarding the Product. Further, the
parties shall, make reasonable commercial efforts to, within sixty (60) days
following the Effective Date but in any event prior to the sale of any Product
to third parties, enter into a written agreement regarding adverse event
reporting and procedures acceptable to Allergan.

         10.7 NOTIFICATION OF COMPLAINTS. Each party shall (i) notify the other
party within one business day of any information concerning any complaint
involving the possible failure of the Product to meet any requirement of
applicable law or regulation, and any serious or unexpected side effect, injury,
toxicity or sensitivity reaction or any unexpected incidents associated with the
distribution of the Product, whether or not determined to be attributable to the
Product and (ii) with respect to adverse events, comply with the provisions of
SECTION 10.6 above. Ivivi shall have responsibility and pay all costs and
expenses associated with investigating such complaint, with reasonable
assistance from Allergan for investigating such complaints.

                                       22
<PAGE>

         10.8 NOTIFICATION OF THREATENED ACTION. Each party shall immediately
notify the other party of any information it receives regarding any threatened
or pending action, inspection or communication by or from any party, including,
without limitation, a Governmental Health Authority which may affect the safety
or efficacy claims of the Product or the continued marketing of the Product.
Upon receipt of such information, the parties shall consult with each other in
an effort to arrive at a mutually acceptable procedure for taking appropriate
action. Ivivi shall bear all costs and expenses associated with taking such
action.

         10.9 ALLERGAN AUDITS. Ivivi will give Allergan reasonable access to its
records and manufacturing facilities (and will obtain sufficient rights to give
Allergan reasonable access to the records and manufacturing facilities of any
manufacturer of the Product), to allow Allergan to conduct full compliance
audits relating to the Product (including with respect to its manufacture and
packaging), at Allergan's expense, as reasonably deemed necessary by Allergan,
but no more frequently than once in any twelve (12) month period unless any such
audits reveal material compliance problems in which case there shall be no
limitation of the frequency of such compliance audits and the next two (2) such
audits shall be at Ivivi's expense. In furtherance of this right, Ivivi agrees
that it shall specifically obtain from any and all third-party manufacturers of
the Product a right of Allergan to conduct audits of such manufacturer's records
and facilities. The audit may include, without limitation, records relating to
manufacturing compliance with the Specifications, compliance with quality
control and inspection reports procedures, compliance with GMP/QSR Regulations,
CE mark certification records and procedures, regulatory compliance, and after
the following certifications have been obtained compliance with ISO 13485:2003
and Council Directive 93/42/EEC (Medical Device Directive) requirements. Such
audits will be conducted during Ivivi's normal business hours, after two (2)
weeks prior written notice to Ivivi by Allergan, and at times mutually agreeable
to the parties. Ivivi will make its regulatory compliance and quality assurance
personnel (and such personnel of any sub-contractors, if applicable) reasonably
available to Allergan in connection with such audits. If Allergan recommends any
corrective actions to Ivivi in connection with such audits, Ivivi will take any
corrective action recommended by Allergan within thirty (30) days of receipt of
any corrective action recommendations, if possible, or will inform Allergan in
writing of the reasons why Ivivi believes such corrective action is not required
or cannot be completed within such thirty (30) day period. Allergan will be
given access to audit any corrective action. In the event that Ivivi is not
manufacturing the Product and is using a third party to manufacture the Product,
Ivivi shall obtain all rights necessary from such third party to enable Allergan
to exercise all of its rights under this Agreement.

         10.10 REGULATORY INSPECTIONS. Ivivi will promptly notify Allergan of
any inspection of its facilities manufacturing the Product or any component part
of a Product by the FDA, ISO, CE mark certification organization or other
federal, state, or local regulatory agency which relates to the manufacture,
assembly, or packaging of the Product and provide Allergan with information
about the progress and outcome of such inspection, including, without
limitation, copies of any notice of observations or warnings, requests for
Remedial Action, CAPA's or other adverse findings.

                                       23
<PAGE>

                                   ARTICLE 11
                              INTELLECTUAL PROPERTY

         11.1 IVIVI PROPERTY. The Product, the Patents and the Ivivi
Intellectual Property, including all derivatives, Improvements and documentation
thereof, that are solely conceived, fixed in a tangible medium of expression or
otherwise developed, invented or reduced to practice by Ivivi or its Affiliates
are the proprietary property of Ivivi or its licensors, and exclusive title to
such property shall remain with Ivivi or its licensors, both during and after
termination of this Agreement. Allergan agrees to promptly notify Ivivi in the
event that the senior management of Allergan obtains actual and specific
knowledge of an infringement of the Patents and the Ivivi Intellectual Property.
Ivivi shall be responsible for filing and prosecuting all U.S. and foreign
patent, copyright and mask work applications it deems necessary or appropriate
to protect the Ivivi Intellectual Property. In the event Ivivi fails to take
action to protect or enable the Ivivi Intellectual Property in the Marketing
Territory, Ivivi shall indemnify Allergan from damages, liabilities and costs,
and Allergan shall have the right to take all actions necessary to protect the
Ivivi Intellectual Property.

         11.2 ALLERGAN PROPERTY. Allergan retains sole title to, and ownership
of, all Allergan products, Allergan's Intellectual Property and improvements
thereon, all derivative works of Allergan products, Allergan's Intellectual
Property and improvements and all proprietary rights therein, that are solely
conceived, fixed in a tangible medium of expression or otherwise developed,
invented or reduced to practice by Allergan or its Affiliates both during and
after termination of this Agreement. The parties agree that Allergan shall
retain sole ownership of information regarding customers, distributors,
sublicensees and subdistributors of the Product acquired under this Agreement,
which information shall be treated as confidential pursuant to ARTICLE 12 of
this Agreement. Works that may be created, marketed or bundled with the Product
by Allergan, which works do not infringe the Patents, are the proprietary
property of Allergan or its licensors, and exclusive title to such property
shall remain with Allergan or its licensors, both during and after termination
of this Agreement.

                                   ARTICLE 12
                            CONFIDENTIAL INFORMATION

         12.1 CONFIDENTIALITY. Each party acknowledges that, in the course of
performing its duties and obligations under this Agreement, certain information
that is confidential or proprietary to such party ("CONFIDENTIAL INFORMATION")
will be furnished by the other party or such other party's representatives. Each
party agrees that any Confidential Information furnished by the other party or
such other party's representatives will not be used by it or its representatives
except in connection with, and for the purposes of, the promotion, marketing,
distribution and sale of Product and for any other purpose permitted under this
Agreement (including for the purposes of manufacturing the Product pursuant to
SECTION 4.3 during the Manufacturing License Period) and, except as provided
herein, will not be disclosed by it or its representatives without the prior
written consent of the other party. Notwithstanding the foregoing, Confidential
Information furnished by a party may be disclosed by a receiving party to such
receiving party's professional advisors or such receiving party's bona fide

                                       24
<PAGE>

potential purchasers, acquirers, investors, bankers and lenders, and the
professional advisors of the foregoing; provided that such persons need to know
the disclosed information and agree to be bound by the receiving party's
obligation of confidentiality with respect to such information. The parties
further agree that all Confidential Information shall be clearly marked
"CONFIDENTIAL" or, if furnished in oral form, shall be stated to be confidential
by the party disclosing such information at the time of such disclosure and
reduced to a writing by the party disclosing such information which is furnished
to the other party or such other party's representatives within forty-five (45)
days after such disclosure.

         12.2 EXCEPTIONS. The confidentiality obligations of each party under
SECTION 12.1 do not extend to any Confidential Information furnished by the
other party or such other party's representatives that (a) is or becomes
generally available to the public other than as a result of a disclosure by the
recipient party or its representatives, (b) is or becomes generally available to
the public as a result of a disclosure specifically permitted under SECTION 12.3
and SECTION 12.5, (c) was available to the recipient party or its
representatives on a non-confidential basis prior to its disclosure thereto by
the other party or such other party's representatives, (d) can be demonstrated
by the recipient party that it was independently developed by the recipient
party without reference to any Confidential Information of the other party, or
(e) becomes available to such party or its representatives on a non-confidential
basis from a source other than the other party or such other party's
representatives; provided, however, that such source is not bound by a
confidentiality agreement with the other party or such other party's
representatives.

         12.3 TERMS OF AGREEMENT. The terms of this Agreement, and the
transactions contemplated hereby, that are not required to be disclosed by
applicable laws or the rules and regulations of the Applicable Market and are
not disclosed in accordance with the terms of SECTION 12.4, 12.5, or 16.13 shall
be deemed to be Confidential Information subject to the provisions of SECTION
12.1.

         12.4 COMPELLED DISCLOSURE. Other than with respect to filings required
by applicable laws or the rules and regulations of the Applicable Market (both
of which shall be subject to SECTIONS 12.3 and 12.5), in the event that either
party or its representatives are requested or become legally compelled (by oral
questions, interrogatories, requests for information or document subpoena, civil
investigative demand or similar process) to disclose any Confidential
Information furnished by the other party or such other party's representatives
or the fact that such Confidential Information has been made available to it,
such party agrees that it or its representatives, as the case may be, will
provide the other party with prompt written notice of such request(s) so that
the other party may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this Agreement. In the event that such
protective order or other remedy will not be obtained, or that the other party
waives compliance with the provisions of this Agreement, such party agrees that
it will furnish only that portion of such Confidential Information that is
legally compelled and will exercise commercially reasonable efforts to obtain
reliable assurance that confidential treatment will be accorded to that portion
of such Confidential Information and other information being disclosed.

         12.5 SECURITIES FILINGS. The parties acknowledge that Ivivi is required
to disclose the existence of this Agreement, including certain of the terms
hereof, and to file this Agreement with the Securities and Exchange Commission
(the "SEC") pursuant to applicable securities laws, rules and regulations. In
connection with any required filings of the Agreement, Ivivi agrees to seek

                                       25
<PAGE>

confidential treatment of such portions of the Agreement that Allergan
reasonably requests (in addition to any portions for which Ivivi wishes to seek
confidential treatment), and to provide copies to Allergan of any proposed
request for confidentiality, including all amendments thereof and all
correspondence relating thereto, at least five (5) business days prior to
submitting such request (or amendment or correspondence) to the SEC, the
Applicable Market or any similar entity or authority, as applicable, and will
include and incorporate Allergan's comments to such submission to the extent
reasonable. Any termination of this Agreement by Allergan for material breach by
Ivivi of this SECTION 12.5 or of SECTION 16.13 shall be subject to SECTION
15.3(c) and not to SECTION 15.3(b).

         12.6 SURVIVAL. The obligations of the parties under this ARTICLE 12 and
SECTION 16.13 shall survive the expiration or earlier termination of this
Agreement for a period of five (5) years.

         12.7 INDEPENDENT DEVELOPMENT; RESIDUALS. Ivivi acknowledges that
Allergan may currently or in the future be developing information internally, or
receiving information from other parties, that is similar to the Confidential
Information. Accordingly, nothing in this Agreement will be construed as a
representation or agreement that Allergan will not develop or have developed for
it products, concepts, systems or techniques that are similar to or compete with
the products, concepts, systems or techniques contemplated by or embodied in the
Confidential Information, provided that Allergan does not violate any of its
obligations under this Agreement in connection with such development.
Additionally, Allergan shall be free to use the residuals resulting from access
to or work with Ivivi's Confidential Information for any purpose, provided that
Allergan shall not disclose Ivivi's Confidential Information except as permitted
pursuant to the terms of this Agreement. The term "residuals" means information
in intangible form, retained in the unaided memory (without the aid of notes or
other memory aids and without any conscious attempt to memorize or refresh
recollections) of persons employed or retained by Allergan who have had access
to or worked with the Confidential Information, including ideas, concepts,
know-how or techniques contained therein. Allergan shall not have any obligation
to limit or restrict the assignment of such persons or to pay royalties for any
work resulting from the use of residuals. Nothing in this SECTION 12.7 shall be
construed as a license or the grant of a license to the Patents.

                                   ARTICLE 13
                      [ARTICLE 13 INTENTIONALLY LEFT BLANK]

                                   ARTICLE 14
                     INDEMNIFICATION; INSURANCE REQUIREMENTS

         14.1 IVIVI INDEMNITY. Ivivi agrees to indemnify, defend and hold
harmless Allergan and its subdistributors and sublicensees (and the Affiliated
Parties of any of the foregoing) (collectively, the "ALLERGAN INDEMNIFIED
PARTIES") from and against any claims, losses, damages, liabilities, causes of
action, suits, costs and expenses, including all reasonable attorneys' fees and
disbursements of counsel and expenses of investigation, incurred by Allergan
Indemnified Parties arising out of or relating to (i) any material breach by
Ivivi of its representations, warranties, covenants and agreements under this
Agreement, (ii) any third-party claims, actions, suits or proceedings alleging

                                       26
<PAGE>

personal injury or death, or any damage to any property, caused or allegedly
caused by any Product, or the failure to warn any person or entity of any defect
in any Product, except to the extent resulting from the gross negligence or
willful misconduct of, or material breach of this Agreement by, Allergan, (iii)
allegations that the Ivivi Intellectual Property, or the use thereof, or the
exercise of any rights granted to Allergan and its Affiliates under this
Agreement, violates, infringes upon or misappropriates the rights of any third
party, (iv) any grossly negligent or willful act or omission on the part of
Ivivi, and (v) any product liability claims including, without limitation, any
claim under SECTION 8.3 hereof.

         14.2 ALLERGAN INDEMNITY. Allergan agrees to indemnify, defend and hold
harmless Ivivi and its Affiliated Parties from and against any claims, losses,
damages, liabilities, causes of action, suits, costs and expenses, including all
reasonable attorneys' fees and disbursements of counsel and expenses of
investigation, incurred by Ivivi or such Affiliated Parties arising out of or
relating to (i) any material breach by Allergan of its representations,
warranties, covenants and agreements under this Agreement, (ii) any third-party
claims, actions, suits or proceedings relating to the marketing, promotion,
sale, handling or distribution by Allergan or its sublicensees of the Product
but only to the extent such claims arise from a material failure of Allergan or
its sublicensees to comply with the material provisions of this Agreement or
gross negligence or willful misconduct in the representation of the Product, or
(iii) any third-party claims, actions, suits or proceedings relating to personal
injury or death or damage to any property caused by any Allergan product or
service that Allergan bundles or provides in conjunction with the Product but
only if and to the extent it is finally determined by a court of competent
jurisdiction that the Allergan product or service was the cause of such harm;
provided that the foregoing (i) through (iii) is not based upon any claim upon
which Ivivi is to indemnify Allergan under SECTION 14.1 hereof, and except to
the extent resulting from the negligence or willful misconduct of, or material
breach of this Agreement or any inaccuracy of any representation or warranty of
or by, Ivivi.

         14.3 CLAIMS FOR INDEMNIFICATION. Whenever any indemnification claim
arises under this Agreement, the party seeking indemnification (the "INDEMNIFIED
PARTY") shall promptly notify the other party (the "INDEMNIFYING Party") of the
claim and, when known, the facts constituting the basis of such claim; provided,
however, that failure to give such notice shall not relieve the Indemnifying
Party of its obligation hereunder unless and to the extent that such failure
substantially prejudices the Indemnifying Party. To clarify, and without
limiting any obligation hereunder, the parties agree that any and all liability
of one party to the other under SECTION 14.1 and SECTION 14.2 hereof regarding
any amounts paid or payable to a third party related to any claim, demand,
proceeding, suit or action for which one party is obligated to indemnify the
other party pursuant to ARTICLE 14 hereof are and shall be considered
compensatory or direct damages (and not indirect, special, consequential,
punitive, exemplary, collateral or incidental damages) and the parties do not
intend that such damages are and they shall not be subject to the liability
limitation set forth in SECTION 14.7 hereof.

         14.4 THIRD-PARTY CLAIMS. In the event of a third-party claim giving
rise to indemnification of the Allergan Indemnified Parties hereunder, Allergan
may, upon prior written notice to Ivivi, assume the defense of such claim, at
Ivivi's expense; provided that Ivivi may participate in such defense at its own
expense and with counsel of its choice. In all other cases and if Allergan does
not elect to assume the defense, in the event of a third-party claim giving rise
to indemnification hereunder, the Indemnifying Party may, upon prior written
notice to the Indemnified Party, assume the defense of such claim with counsel
reasonably satisfactory to the Indemnified Party, and shall thereafter be liable
for all expenses incurred in connection with such defense, including attorneys'

                                       27
<PAGE>

fees and expenses; provided, however, that if the Indemnifying Party assumes the
defense of any such claim, the Indemnified Party may participate in such defense
at its own expense and with counsel of its choice; provided further, however,
that if there are one or more legal defenses available to the Indemnified Party
that conflict with those available to the Indemnifying Party or there exists any
other conflict of interest, the Indemnifying Party shall not have the right to
assume the defense of such claim but the Indemnified Party shall have the right
to employ separate counsel at the expense of the Indemnifying Party and to
participate in the defense thereof. If the Indemnifying Party elects to control
the defense of such claim, it shall do so diligently and shall have the right to
settle any claim for monetary damages, provided such settlement includes a
complete and absolute release of the Indemnified Party. Notwithstanding anything
to the contrary, the Indemnifying Party may not settle any claims for fines,
penalties or the like or in any way adverse to the Indemnified Party without the
prior written consent of the Indemnified Party.

         14.5 THIRD-PARTY INFRINGEMENT. In the case of any infringement or
violation by any third party of any rights granted to Allergan hereunder, Ivivi
shall have the right, at Ivivi's expense, to exercise its rights (including,
without limitation, common law and statutory rights) to cause such third party
to cease such infringement and to otherwise enforce such rights. Each party
shall promptly notify the other party in writing of any infringement or
violation by any third party of any rights granted to Allergan hereunder of
which it becomes aware. Allergan shall assist Ivivi as reasonably requested in
taking any such actions against any such infringer and may join with Ivivi to
recover damages and lost profits in any action, suit or proceeding commenced, or
claim made, by Ivivi against such infringer. In the event that Ivivi fails to
institute proceedings to terminate any third-party infringement during the
ninety (90) day period following notice of any alleged infringement or violation
(but in any event at least forty-five (45) days prior to any related filing
deadlines), Allergan may, at its cost and expense, take such action as it deems
appropriate, including without limitation, the filing and prosecution of a
lawsuit against such third party. In such event, Ivivi will provide such
assistance and cooperation to Allergan as may be reasonably necessary,
including, without limitation, agreeing to be named a co-party or party
plaintiff. Any award in such action shall be first distributed to the parties
until their respective costs (including internal costs) and expenses have been
recouped, and the balance shall be allocated as follows: [*].

         14.6 INFRINGEMENT DEFENSE. In the event either party receives notice of
any claim that the manufacture, use or sale of a Product infringes the rights of
a third party, it shall give prompt notice to the other party and shall discuss
in good faith alternative strategies for addressing the matter and cooperate
with each other to terminate such infringement without litigation. After such
discussion, Ivivi shall have the right and obligation, at its sole cost and
expense, to defend against such claim. Notwithstanding the foregoing, at its
sole option, Allergan shall have the right to assume the defense, at Ivivi's
expense; provided that Ivivi may participate in such defense at its own expense
and with counsel of its choice. In such event, Ivivi will provide such
assistance and cooperation to Allergan as may be reasonably necessary. If
Allergan does not assume the defense, Allergan shall provide such assistance and
cooperation to Ivivi as may be necessary to defend any such action, and Ivivi
shall have the right to settle such action for monetary damages, provided such
settlement includes a complete and absolute release of Allergan and, provided
further, that Ivivi uses good faith when it considers any such action and takes
such action as to effectuate the License and intent of this Agreement.
Notwithstanding anything to the contrary, Ivivi may not settle any claims for
fines, penalties or the like or in any way adverse to Allergan without the prior
written consent of Allergan.

                                       28
<PAGE>

         14.7 LIMITATION ON LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE
TO THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, PUNITIVE,
EXEMPLARY, COLLATERAL OR INCIDENTAL DAMAGES, HOWEVER CAUSED AND BASED ON ANY
THEORY OF LIABILITY, ARISING OUT OF THIS AGREEMENT, AND WHETHER OR NOT THE OTHER
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIMITATION SHALL
APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY
PROVIDED FOR HEREIN. IN ADDITION, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO
THE OTHER PARTY FOR AN AMOUNT IN EXCESS OF [*] IN THE AGGREGATE (THE "CAP") FOR
ANY AND ALL CLAIMS ARISING FROM OR RELATING TO THIS AGREEMENT. THE PARTIES
AGREE, HOWEVER, THAT THE FOREGOING LIMITATIONS OF THIS SECTION 14.7 DO NOT APPLY
TO ANY AMOUNTS PAID OR PAYABLE DUE TO ANY THIRD-PARTY RELATED CLAIM, DEMAND,
PROCEEDING, SUIT OR ACTION FOR WHICH A PARTY IS OBLIGATED TO INDEMNIFY THE OTHER
PARTY PURSUANT TO THIS ARTICLE 14, OR FOR PRODUCT RELATED CLAIMS INCLUDING
WITHOUT LIMITATION THOSE UNDER SECTION 8.3 OF THIS AGREEMENT OR OTHERWISE AND
ANY SUCH AMOUNTS WILL BE CONSIDERED COMPENSATORY OR DIRECT DAMAGES AND NOT
INDIRECT, SPECIAL, CONSEQUENTIAL, PUNITIVE, EXEMPLARY, COLLATERAL OR INCIDENTAL
DAMAGES. THE PARTIES FURTHER AGREE THAT THE CAP DOES NOT APPLY TO EITHER PARTY'S
INDEMNIFICATION OBLIGATIONS UNDER THIS SECTION 14, ROYALTIES, TRANSFER PRICE,
INITIAL AND MILESTONE PAYMENTS UNDER SECTION 5.6, EXTENSION FEE, CUSTOMS DUTIES,
EXPORT FEES, IMPORT FEES AND FREIGHT, SHIPPING OR TRANSPORTATION CHARGES DUE AND
PAYABLE TO IVIVI PURSUANT TO THIS AGREEMENT; PROVIDED HOWEVER THAT ALLERGAN
SHALL HAVE A RIGHT OF SET OFF WITH RESPECT TO ALL SUCH AMOUNTS FOR ANY AMOUNTS
OWING TO ALLERGAN PURSUANT TO THIS AGREEMENT. NOTWITHSTANDING ANY PROVISION OF
THIS AGREEMENT, UNDER NO CIRCUMSTANCE SHALL ALLERGAN'S AGGREGATE LIABILITY
(OTHER THAN LIABILITY FOR ROYALTIES, TRANSFER PRICE, INITIAL AND MILESTONE
PAYMENTS UNDER SECTION 5.6, EXTENSION FEE, CUSTOMS DUTIES, EXPORT FEES, IMPORT
FEES AND FREIGHT, SHIPPING OR TRANSPORTATION CHARGES DUE AND PAYABLE TO IVIVI
PURSUANT TO THIS AGREEMENT SUBJECT TO ALLERGAN'S RIGHT OF SET OFF SET FORTH
HEREIN) EXCEED [*].

         14.8 COOPERATION AS TO INDEMNIFIED LIABILITY. Each party hereto shall
cooperate fully with other parties with respect to access to books, records, or
other documentation within such party's control, if deemed reasonably necessary
or appropriate by any party in the defense of any claim, which may give rise to
indemnification hereunder.

         14.9 INSURANCE REQUIREMENTS. To provide sufficient protection to both
Ivivi and Allergan, Ivivi and Allergan will, individually, at their own cost and
expense, obtain and maintain in full force and effect, during the term of this
Agreement, Commercial General Liability insurance, maintained with responsible,

                                       29
<PAGE>

nationally recognized carriers, written on a standard approved policy form,
including Product Liability, Completed Operations and Broad Form Contractual
Liability, with limits of liability of not less than [*] covering each party's
duties and obligations under the Agreement and naming the other party as an
additional insured; [*]. Any and all policy deductibles shall be assumed
respectively by Ivivi and Allergan. Policies held respectively by Ivivi and
Allergan shall be considered primary and bear no relationship to any policies
held by the other. Ivivi and Allergan will each furnish each other with a
certificate of insurance within thirty (30) days of the Effective Date of this
Agreement evidencing that such insurance is in effect and that a minimum of
thirty (30) days notice must be given to the other party prior to any
cancellation or material changes to the policy. Ivivi shall also immediately
furnish such a certificate of insurance upon increasing its limits of liability
to not less than [*].

                                   ARTICLE 15
                              TERM AND TERMINATION

         15.1 TERM. This Agreement shall take effect as of the Effective Date
and shall continue in force and effect for a period of eight (8) years from the
date of the First Commercial Sale of the Product in the U.S. (the "INITIAL
TERM"). Thereafter, provided that Allergan is not in material default of this
Agreement at the time of the expiration of the Initial Term, the Agreement shall
be automatically extended for five (5) consecutive terms of two (2) years each
(each an "EXTENSION TERM") unless Allergan notifies Ivivi, at least one hundred
fifty (150) days prior to the beginning of an Extension Term, of its intent not
to extend the Agreement. Notwithstanding the foregoing, the Agreement shall
terminate after the first Extension Term if Allergan does not pay to Ivivi an
extension fee of Two Million Dollars ($2,000,000) on or before January 1, 2010
(the "EXTENSION FEE").

         15.2 TERMINATION. Notwithstanding the provisions of SECTION 15.1, this
Agreement may be terminated in accordance with the following provisions:

                  (a) Either party may terminate this Agreement at any time by
giving notice in writing to the other party, which notice shall be effective
upon dispatch, should the other party file a petition of any type as to its
bankruptcy, be declared bankrupt, become insolvent, make an assignment for the
benefit of creditors, or go into liquidation or receivership.

                  (b) Either party may terminate this Agreement by giving notice
in writing to the other party in the event the other party is in material breach
of this Agreement and shall have failed to cure such breach within sixty (60)
days of receipt of written notice thereof specifying the breach in detail from
the non-breaching party, unless such breach cannot be cured within such sixty
(60)-day period, in which case the breaching party shall have undertaken a good
faith effort to cure such breach within such sixty (60)-day period and
diligently prosecuted such cure to prompt completion.

                  (c) During the Initial Term and during the first Extension
Term, Allergan may terminate this Agreement by giving ninety (90) days notice in
writing to Ivivi, which notice shall be effective upon dispatch. During any
extensions of the Agreement after the Initial Term (other than during the first
Extension Term), Allergan may terminate this Agreement by giving one hundred
eighty (180) days notice in writing to Ivivi, which notice shall be effective
upon dispatch.

                                       30
<PAGE>

                  (d) If Allergan does not pay to Ivivi the minimum royalty
amount set forth on SCHEDULE D for any applicable year or meet the minimum order
requirement set forth in SECTION 5.5, Ivivi will have the right to terminate
this Agreement by giving notice within ninety (90) days after the failure of
Allergan to meet such minimum sales or payment requirements and such termination
shall be effective if Allergen fails to cure such failure within thirty (30)
days of Allergan's receipt of such notice. Any termination pursuant to this
section shall be effective no earlier than twelve (12) months from the date of
such notice.

         15.3 RIGHTS AND OBLIGATIONS UPON TERMINATION.

                  (a) Upon any termination of this Agreement by Ivivi pursuant
to SECTION 15.2(a), or pursuant to SECTION 15.2(b) where Allergan is the
breaching party, Allergan shall (i) promptly deliver to Ivivi or destroy all
materials, samples, documents and information relating to the Product developed
or owned by Ivivi, subject to Allergan retaining a copy of such Confidential
Information solely for the purposes of monitoring its performance hereunder and
as may be reasonably necessary for Allergan to perform relevant post-termination
activities as permitted under this Agreement and as may be required by law, (ii)
immediately cease marketing, promoting or otherwise using the Product, (iii)
have no further interest in the technology and information developed or owned by
Ivivi with respect to the Product; and (iv) transfer and assign, at Ivivi's
cost, to Ivivi or its designees all of Allergan's rights in governmental filings
or approvals and other similar rights in connection with the Product (excluding
any Allergan Intellectual Property) provided that Ivivi reimburses Allergan for
the costs of attaining such governmental filings or approvals and similar
rights. Notwithstanding (iii) above, Ivivi shall have no right and Allergan
shall not be required to transfer and assign, Allergan's rights in any
Intellectual Property including, without limitation, any trademarks owned by
Allergan and used in connection with the Product. In addition, Allergan shall
return to Ivivi or its designees all Product held by Allergan, in return for the
original purchase price paid by Allergan to Ivivi for such inventory, less
appropriate discounts for damaged or obsolete inventory and reasonable costs of
repackaging.

                  (b) Upon the termination of this Agreement by Allergan
pursuant to SECTION 15.2(a), or pursuant to SECTION 15.2(b) where Ivivi is the
breaching party (other than for a Failure to Supply or for a breach of the
representation in SECTION 9.1(f)) where as a result of such breach by Ivivi the
benefits Allergan would otherwise enjoy under this Agreement will be
substantially diminished, then: (i) upon the election of and written notice by
Allergan, Ivivi shall promptly deliver to Allergan copies of any and all
information, and license to Allergan such rights as are necessary for Allergan
to take over Ivivi's obligations hereunder including, without limitation, all
materials, samples, documents and information relating to the Product in the
Field, (ii) upon the election of and written notice by Allergan, Ivivi shall
promptly license to Allergan, or otherwise provide to Allergan the benefit of,
any and all governmental filings or approvals and other similar rights in
connection with the Product in the Field, (iii) the Escrow Deposit shall be
released to Allergan, (iv) Allergan shall continue to enjoy the benefits of the
License until the date the Agreement would have otherwise expired (after all
applicable extensions thereof) had the Agreement not been terminated, and (v)

                                       31
<PAGE>

Allergan shall have the right to exercise the license rights granted under
SECTION 3.1(b) of this Agreement and shall pay Ivivi the Manufacturing License
Compensation in accordance with and subject to the limitations set forth in
SECTION 4.3 hereof, provided, however, that the royalty rate used to calculate
such Manufacturing License Compensation shall be [*], and not the royalty rate
set forth in SECTION 5.4(a). In addition, the compensation to be paid pursuant
to clause (v) shall not be subject to the minimum royalty required by SECTION
5.4(b). Ivivi agrees that all licenses or grants of any of the rights set forth
above shall be on an exclusive basis in the Territory, as necessary to allow
Allergan to enjoy the same rights and benefits it would have enjoyed during the
term of this Agreement (including all applicable extensions thereof). Without
limiting the grant of any rights or licenses provided above, or the exclusivity
of any of the foregoing, nothing in this SECTION 15.3(b) shall abrogate or
impair any of the right, title and interest of Ivivi in the Product, the Patents
or the Ivivi Intellectual Property, or constitute a transfer or assignment of
any rights of Ivivi in the Product, the Patents or the Ivivi Intellectual
Property to Allergan except as explicitly set forth herein. At the conclusion of
the term of this Agreement (including all applicable extensions thereof),
Allergan shall comply with all of the obligations set forth in SECTION 15.3(c)
as if the termination was pursuant to SECTION 15.3(c). The parties agree that
this Agreement shall be subject to Section 365(n) of the Bankruptcy Code.

                  (c) Upon any termination or expiration of this Agreement other
than pursuant to SECTION 15.2(a) or SECTION 15.2(b), (i) each party shall
promptly deliver to the other party or destroy all Confidential Information of
the other party, including materials, samples and documents of the other party,
subject to either party retaining a copy of the other party's Confidential
Information solely for any purpose contemplated by this Agreement or as may be
required by law, and (ii) Allergan shall cease marketing, promoting or otherwise
using the Product immediately after the resale of any inventory as provided in
SECTION 15.4(c).

         15.4 EFFECT OF TERMINATION. Except as otherwise provided in this
Agreement:

                  (a) Termination or expiration of this Agreement shall not
release either party from the obligation to make payment of all amounts then or
thereafter due and payable.

                  (b) The terminating party shall have the right, at its option,
to cancel any or all purchase orders that provide for delivery after the
effective date of termination.

                  (c) Allergan shall be permitted to resell any inventory of the
Product on hand or en route or which has been ordered from Ivivi at the time of
termination and the License (other than the license granted under SECTION
3.1(b)) shall continue on a non-exclusive basis until all such Units have been
sold, provided Allergan continues to pay the applicable royalty on Net Sales of
such Units; provided, however, that Allergan shall have no obligation to
purchase or take delivery of any Product from or after the effective date of
termination.

                  (d) Notwithstanding any other provision of this Agreement, in
the event Allergan terminates this Agreement (i) pursuant to SECTION 15.2(b), or
(ii) because Ivivi has breached its obligations under SECTION 5.7 or (iii) in
connection with a Failure to Supply, Ivivi shall refund to Allergan any payment
made by Allergan to Ivivi pursuant to SECTION 5.6. In the event (x) Ivivi
terminates this Agreement pursuant to SECTION 15.2(b) and (y) Allergan has been
reimbursed in full for the costs of pursuing or maintaining any patents that
were assigned to Allergan pursuant to SECTION 7.5, then Allergan shall assign to
Ivivi the patents that it took over pursuant to such section.

                                       32
<PAGE>

                  (e) Allergan's and Ivivi's indemnification obligations
pursuant to ARTICLE 14 and their respective obligations pursuant to Sections
5.4, 5.8, 5.9, 5.10, 5.11 and 7.3 and ARTICLE 8, ARTICLE 9, ARTICLE 11, ARTICLE
12, ARTICLE 15 and ARTICLE 16 shall survive termination of this Agreement. All
other provisions of this Agreement shall terminate upon termination of this
Agreement.

                  (f) Except as specifically set forth in this ARTICLE 15, upon
termination of this Agreement for any reason, neither party shall have any
further obligations pursuant to this Agreement, including any obligation of
Allergan to purchase or order any minimum number of Units.

                                   ARTICLE 16
                                  MISCELLANEOUS

         16.1 RELATIONSHIP OF PARTIES. The relationship of the parties
established by this Agreement is solely that of independent contractors, and
nothing shall be deemed to create or imply any employer/employee,
principal/agent, partner/partner or co-venturer relationship, or that the
parties are participants in a common undertaking. Neither party shall have the
right to direct or control the activities of the other party or incur or assume
or create any obligation, representation, warranty or guarantee, express or
implied, on behalf of the other party or bind such other party to any obligation
for any purpose whatsoever.

         16.2 ENTIRE AGREEMENT. This Agreement, including the exhibits and
schedules attached hereto and incorporated as an integral part of this
Agreement, constitutes the entire agreement of the parties with respect to the
subject matter hereof, and supersedes all previous proposals, oral or written,
and all negotiations, conversations or discussions heretofore had between the
parties related to this Agreement.

         16.3 NO WAIVER; AMENDMENT. No waiver of any term or condition of this
Agreement shall be valid or binding on any party unless agreed to in writing by
the party to be charged. The failure of either party to enforce at any time any
of the provisions of the Agreement, or the failure to require at any time
performance by the other party of any of the provisions of this Agreement, shall
in no way be construed to be a present or future waiver of such provisions, nor
in any way affect the validity of either party to enforce each and every such
provision thereafter. This Agreement may not be amended or modified except by
the written agreement of the parties. All purchase orders are subject to the
terms and conditions of this Agreement, and any attempt by such purchase order
to alter or modify the terms and conditions of this Agreement shall be void.

         16.4 PARTIAL INVALIDITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid by
a court of competent jurisdiction, then the remaining provisions shall remain,
nevertheless, in full force and effect. The parties agree to renegotiate in good

                                       33
<PAGE>

faith, or instruct the court to rewrite, any term held invalid and to be bound
by the mutually agreed substitute provision in order to give the most
approximate effect intended by the parties.

         16.5 ASSIGNMENT.

                  (a) Neither party may assign or otherwise transfer its rights
and obligations under this Agreement, including upon a Change of Control (as
defined below), without the prior written consent of the other party, which
consent shall not be unreasonably withheld, delayed or conditioned.

                  (b) Notwithstanding the foregoing, Allergan may assign or
otherwise transfer its rights and obligations under this Agreement, without the
prior written consent of Ivivi, (A) to its Affiliates or affiliates (as such
term is defined under federal securities laws), and (B) upon a sale of all or
substantially all of the assets or equity of the business entity, division or
unit, as applicable, that markets, distributes or sells the Product.

                  (c) Any attempted assignment or transfer in violation of this
provision shall be null and void. All terms and conditions of this Agreement
shall be binding on and inure to the benefit of the successors and permitted
assigns of the parties.

                  (d) For purposes of this Section 16.5, the term "Change of
Control" shall mean any sale of the equity securities of a party following which
the equity holders of such party immediately prior to such sale own, directly or
indirectly, less than fifty percent (50%) of the combined voting power of the
outstanding voting securities of such party; provided, that the term Change in
Control shall not include a transaction involving either party in a sale of
equity securities for the purpose of raising capital to a group of financial
investors and where management of the selling party before the financing is
substantially the same as management of such party after the financing.

                  (e) Prior to or promptly after any assignment not requiring
consent of the other party, the assigning party shall give the other party
notice of the assignment.

         16.6 GOVERNING LAW. This Agreement shall be governed by, and
interpreted and construed in accordance with the laws of the State of
California, without reference to rules of conflicts or choice of laws.

         16.7 JURISDICTION AND VENUE. Each of the parties hereto irrevocably
submits to the exclusive jurisdiction of the courts of the State of California
located in the County of Orange and the United States District Court for the
Southern District of California for the purpose of any suit, action, proceeding
or judgment relating to or arising out of this Agreement and the transactions
contemplated hereby. Service of process in connection with any such suit, action
or proceeding may be served on each party hereto anywhere in the world by the
same methods as are specified for the giving of notices under this Agreement.
Each of the parties hereto (i) irrevocably consents to the jurisdiction of any
such court in any such suit, action or proceeding and to the laying of venue in
such court and (ii) irrevocably waives, and agrees not to assert, by way of
motion, as a defense, or otherwise, in any such suit, action or proceeding, any
claim that it is not subject personally to the jurisdiction of the above named
court, that its property is exempt or immune from attachment or execution
(except as protected by applicable law), that the suit, action or proceeding is

                                       34
<PAGE>

brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper or that this Agreement or the subject matter hereof may
not be enforced in or by such court, and hereby waives and agrees not to seek
any review by any court of any other jurisdiction which may be called upon to
grant an enforcement of the judgment of any such court. Each of the parties
hereto agrees that its, his or her submission to jurisdiction and its, his or
her consent to service of process by mail is made for the express benefit of the
other parties hereto. Final judgment against any party hereto in any such
action, suit or proceeding may be enforced in other jurisdictions by suit,
action or proceeding on the judgment, or in any other manner provided by or
pursuant to the laws of such other jurisdiction.

         16.8 REMEDIES. The exercise of any remedies hereunder shall be
cumulative and in addition to and not in limitation of any other remedies
available to such party at law or in equity.

         16.9 FURTHER ASSURANCES. Each party agrees to cooperate fully with the
other and execute such instruments, documents and agreements and take such
further actions to carry out the intents and purposes of this Agreement.

         16.10 COUNTERPARTS; FACSIMILE. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and all of which,
taken together, shall constitute one instrument. For purposes hereof, a
facsimile copy of this Agreement, including the signature pages hereto, shall be
deemed to be an original.

         16.11 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by cable,
telegram, facsimile or telex, or by registered or certified mail (postage
prepaid, return receipt requested), to the other party at the following address
(or at such other address for which such party gives notice hereunder):

                 If to Allergan:        Inamed Medical Products Corporation
                                        2525 Dupont Drive
                                        Irvine, CA  92612
                                        Attn:  President
                                        Facsimile No.:  (714) 246-2470

                                        WITH A COPY TO:
                                        Allergan, Inc.
                                        2525 Dupont Drive
                                        Irvine, CA  92612
                                        Attn:  General Counsel
                                        Facsimile No.:  (714) 246-6987

                                       35
<PAGE>

                                        WITH A COPY TO:
                                        Dorsey & Whitney, LLP
                                        38 Technology Drive
                                        Irvine, CA  92618
                                        Attn:  David L. Hayes, Esq.
                                        Facsimile No.:  (949) 932-3601

                 If to Ivivi:           Ivivi Technologies, Inc.
                                        224-S Pegasus Avenue
                                        Northvale, NJ  07647
                                        Attn:  President
                                        Facsimile No.:  (201) 784-0620

                                        WITH A COPY TO:
                                        Troy & Gould P.C.
                                        1801 Century Park East, 16th floor
                                        Los Angeles, California 90067
                                        Attn: Alan B. Spatz, Esq.
                                        Facsimile No.:  (310) 789-1431

                                        WITH A COPY TO:
                                        Lowenstein Sandler PC
                                        65 Livingston Avenue
                                        Roseland, New Jersey 07068
                                        Attn:  Steven M. Skolnick, Esq.
                                        Facsimile No.:  (973) 597-2477

         16.12 CONSTRUCTION; INTERPRETATION. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Any article, section, recital,
exhibit, schedule and party references are to this Agreement unless otherwise
stated. No party, nor its counsel, shall be deemed the drafter of this Agreement
for purposes of construing the provisions of this Agreement, and all provisions
of this Agreement shall be construed in accordance with their fair meaning, and
not strictly for or against any party.

         16.13 PRESS RELEASES AND ANNOUNCEMENTS. Except as provided under this
SECTION 16.13 or under SECTIONS 12.3 and 12.5, Ivivi may not issue any press
release or make any public announcement concerning the transactions contemplated
by this Agreement without the prior consent of Allergan (which consent shall not
be unreasonably withheld, conditioned or delayed) except for (i) any releases or
announcements which may be required by applicable law or the rules and
regulations of the Applicable Market, in which case Ivivi will allow Allergan at
least two (2) full business days to review and comment on such release or
announcement in advance of such issuance or making (unless such release or
announcement is required by applicable law or the rules and regulations of the
Applicable Market to be made within less than four (4) business days of an
event, in which case Ivivi will allow Allergan a reasonable opportunity to
review and comment on such release or announcement, which shall in any event be
at least twenty-four (24) hours in advance of the issuance or making of the

                                       36
<PAGE>

release or announcement), and (ii) any release by Ivivi announcing its quarterly
or annual financial results or any announcement in a conference call with
analysts and investors following the release by Ivivi of its quarterly or annual
financial results, but in each case only to the extent reasonably necessary to
comply with its obligations pursuant to applicable law and the rules and
regulations of the Applicable Market. Notwithstanding any other provision
hereof, except as allowed in clauses (i) and (ii) above and in SECTIONS 12.3,
12.4 or 12.5, the name "Allergan" may not be used or referred to in any way by
Ivivi (without the prior express written consent of Allergan, which shall not be
unreasonably withheld or delayed, other than (x) in press releases announcing
Ivivi's quarterly or annual financial results and in a conference call with
analysts and investors following the release by Ivivi of its quarterly or annual
financial results, but in each case only to the extent reasonably necessary to
comply with its obligations pursuant to applicable law and the rules and
regulations of the Applicable Market, or (y) to the extent already used in
disclosures made pursuant to clause (i) or (ii) above or SECTIONS 12.3 or 12.5).

                            [SIGNATURE PAGE FOLLOWS]

                                       37
<PAGE>

         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the date first above written.

                                      INAMED MEDICAL PRODUCTS CORPORATION

                                      By: /S/ ROBERT E. GRANT
                                          -------------------
                                      Name:   ROBERT E. GRANT
                                           ------------------
                                      Title: PRESIDENT
                                             ---------

                                      IVIVI TECHNOLOGIES, INC.

                                      By: /S/ ANDRE' DIMINO
                                          -----------------
                                      Name:   ANDRE' DIMINO
                                           ----------------
                                      Title: CO-CEO AND VICE CHAIRMAN
                                             ------------------------

                                       38
<PAGE>

                                   SCHEDULE A
                                   ----------

                          PRICES AND MANUFACTURING COST

TRANSFER PRICE:
---------------
The Transfer Price for each Unit of the Product for the years indicated will be
as follows:

                 YEAR                            TRANSFER PRICE
                 ----                            --------------
                 2007                            [*]
                 2008                            [*]
                 2009                            [*]
                 2010 and thereafter             [*]

Allergan will have reasonable audit rights (as more fully described in SECTION
5.9) to verify Manufacturing Cost.

                                       39
<PAGE>

                                   SCHEDULE B
                                   ----------

                                 SPECIFICATIONS

A self contained, battery-operated pulsed electromagnetic field
electrotherapeutic device delivering waveforms as follows:

[*]

                                       40
<PAGE>

                                  SCHEDULE C-1
                                  ------------

                               MARKETING TERRITORY

United States of America

                                       41
<PAGE>

                                  SCHEDULE C-2
                                  ------------

                    JURISDICTIONS/COUNTRIES TO SEEK APPROVAL

[*]

                                       42
<PAGE>

                                   SCHEDULE D
                                   ----------

                                MINIMUM ROYALTIES

MINIMUM ROYALTIES
-----------------
The worldwide annual minimum royalty requirements for the periods indicated
shall be as follows:

                 YEAR                  MINIMUM ROYALTY
                 ----                  ---------------
                 2007                  None
                 2008                  TBD [*]*
                 2009                  TBD [*]
                 2010 and each year
                 thereafter during
                 the term of this
                 Agreement             TBD [*]

                 * Only applicable if the Product is launched in 2006.

Minimum annual royalty requirements for the Product for the Marketing Territory,
commencing 2008 if the Product is launched in 2006, or 2009 if the Product is
launched in 2007, shall be mutually agreed to by the parties [*].

In the event that the parties cannot mutually agree upon the minimum annual
royalty requirement for any year indicated above at least [*] before the
beginning of such year, then the matter shall be settled by arbitration (which
arbitration shall be binding and enforceable in any court of competent
jurisdiction for the purposes of the Agreement only) as follows: (a) the parties
shall jointly select one (1) independent arbitrator with expertise in medical
device marketing and sales within five (5) days, (b) the parties shall cooperate
in good faith in the selection of the arbitrator but, if they fail to do so
within the five (5) day period, either party may request appointment of the
arbitrator by AAA, (c) each party will have two (2) day(s) to present its case
(presentation shall be made on a date selected by the arbitrator which shall be
at least five (5) and no more than ten (10) days after selection of the
arbitrator), (d) the arbitrator shall have ten (10) days from completion of such
presentation to render its decision, and (e) such arbitration shall be informal
and need not conform to AAA or other established procedures. Unless otherwise
agreed to by the parties, arbitration shall take place in Irvine, California and
arbitrator fees will be shared equally by the parties.

                                       43
<PAGE>

                                   SCHEDULE E
                                   ----------

                                     PATENTS

[*]

                                       44
<PAGE>

                                   SCHEDULE F
                                   ----------

                                   TRADEMARKS

IVIVI  serial 78407227 registration 3096530

IVIVI logo  serial 78563058

The technology of life     serial 78437477 registration 3104960

Changing how you heal     serial 78644047

Changing the way you heal     serial 78644095

Electroceutical       serial 78780940

Electroceuticals     serial 78780953

Sofpulse    serial 78563014 registration 3065661

Torino    serial 78821787

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Exhibit 10.4  

 
 

CONVEYANCE OF NET PROFITS INTEREST    
    

        This Conveyance of Net Profits Interest (this "Conveyance") is made, as of the date set forth on the signature
page hereof, from MV Partners, LLC, a Kansas limited liability company (successor by conversion to MV Partners, LP, a Kansas limited partnership) to The Bank of New York Trust Company, N.A., with
offices at 221 West Sixth Street, 1st Floor, Austin, Texas 78701, Attention: Mike J. Ulrich, as trustee (the "Trustee"), acting not in its
individual capacity but solely as trustee of the MV Oil Trust (the "Trust"), a statutory trust created under the Delaware Statutory Trust Act as of
August 3, 2006 (such Trustee acting as trustee of the Trust, "Grantee"). Capitalized terms shall have the meaning set forth in Article II
below. 

 
 

ARTICLE I
  GRANT OF NET PROFITS INTEREST    
    

        For and in consideration of Ten and NO/100 Dollars ($10.00) and other good and valuable consideration (including the issuance by Grantee to Grantor of 11,500,000
Trust Units) to Grantor paid by Grantee, the receipt and sufficiency of which are hereby acknowledged by Grantor, Grantor has bargained, sold, granted, conveyed, transferred, assigned, set over, and
delivered, and by these presents does hereby bargain, sell, grant, convey, transfer, assign, set over, and deliver unto Grantee, its successors and assigns, effective as of the Effective Time,
(i) a net profits interest (the "Net Profits Interest") in and to the Minerals in and under and produced and saved from the Subject Interests
during the Net Profits Period, calculated in accordance with the provision of Article III below and payable solely out of gross proceeds from the sale of the Subject Minerals produced and saved
through the Subject Wells, in an amount equal to the product of the Proceeds Percentage times the Net Profits attributable to the Subject Interests, all as more fully provided hereinbelow and
(ii) without duplication of the foregoing, an amount, payable by wire transfer of immediately available funds on or before the fifth Business Day following the first Quarterly Record Date,
equal to the product of the Proceeds Percentage times the Net Profits that would have been payable by Grantor to Grantee pursuant to the terms of this Conveyance had Grantee been in existence and this
Conveyance been dated and in effect as of July 1, 2006 through, but excluding, the Effective Time, provided that, in the event the amount payable
by Grantor pursuant to this clause (ii) cannot be definitively determined as of the fifth Business Day following the first Quarterly Record Date, Grantor shall pay Grantee, by wire transfer of
immediately available funds on the such date, an amount equal to Grantor's good faith estimate of the amount payable by Grantor pursuant to this clause (ii), and Grantor and Grantee shall
cooperate to
subsequently determine the final amount payable by Grantor to Grantee pursuant to this clause (ii) and (a) if such final amount is more than the amount estimated and paid by Grantor to
Grantee on the fifth Business Day following the first Quarterly Record Date, then Grantor shall pay the difference between these two amounts to Grantee by wire transfer in immediately available funds
within 10 Business Days following the determination of such amount or (b) if such final amount is less than the amount estimated and paid by Grantor to Grantee on such date, then such
overpayment shall be addressed in the manner specified in Section 3.4 hereof. 

        TO
HAVE AND TO HOLD the Net Profits Interest, together with all and singular the rights and appurtenances thereto in anywise belonging, unto Grantee, its successors and assigns, subject,
however, to the following terms and provisions, to-wit: 

 
 

ARTICLE II
  DEFINITIONS    
    

        As used herein, the following terms shall have the meaning ascribed to them below: 

        "Administrative Hedge Costs" shall mean those costs paid by Grantor to counter-parties under the Existing Hedges or to Persons that
provide credit to maintain any Existing Hedge, (in each case) after the Effective Time but excluding any Hedge Settlement Costs. 

 

        "Affiliate" shall mean with respect to a specified Person, any Person that directly or indirectly controls, is controlled by, or is under
common control with, the specified Person. As used in this definition, the term "control" (and the correlative terms "controlling," "controlled by," and "under common control") shall mean the
possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. 

        "Assignment of Hedge Proceeds" shall mean that certain Assignment of Hedge Proceeds of even date herewith between Grantor and Grantee. 

        "Average Annual Capital Expenditure Amount" shall mean the quotient of (a) the sum of (i) the capital expenditures to be
debited to the Net Profits Account and (ii) the amounts debited to the Net Profits Account pursuant to Section 3.1(b)(xiii) for approved capital expenditure projects, in each case
attributable to the three twelve-month periods ending on the Capital Expenditure Limitation Date, divided by (b) three. Commencing on the Capital Expenditure Limitation Date, and each
anniversary of the Capital Expenditure Limitation Date thereafter, the Average Annual Capital Expenditure Amount will be increased by 2.5%. 

        "BOE" shall mean (a) for Oil included in the Subject Minerals, one barrel, (b) for Gas Liquids included in the Subject
Minerals, 1.54 barrels, and (c) for Gas included in the Subject Minerals, the amount of such hydrocarbons equal to one barrel, determined using the ratio of six Mcf of Gas to one barrel of Oil. 

        "Business Day" shall mean a day on which any bank to or from which a payment authorized hereunder may be made are not closed as authorized
or required by law under the laws of the State of Kansas. 

        "Capital Expenditure Limitation Date" shall mean the later to occur of (a) June 30, 2023 and (b) the last day of the
Payment Period during which the total volumes of the Subject Minerals produced, saved and sold from and after July 1, 2006 equals the volume of 13.239134 MMBOE. 

        "Contingent Debt Regulations" shall have the meaning given such term in Section 8.9(b). 

        "Code" shall mean the Internal Revenue Code of 1986, as amended. 

        "Conveyance" shall mean this Conveyance of Net Profits Interest, as the same may be amended or modified from time to time by one or more
instruments executed by both Grantor and Grantee. 

        "Debit Balance" shall have the meaning given such term in Section 3.2(c). 

        "Effective Time" shall mean 7:00 a.m., local time in effect where the Subject Interests are located, on the date of this
Conveyance. 

        "Eligible Materials" shall mean Materials for which amounts in respect of the cost of such Materials were properly debited to the Net
Profits Account. 

        "Existing Hedges" shall mean the Hedges entered into by Grantor with respect to the Subject Minerals prior to the date hereof as more
particularly described in the Assignment of Hedge Proceeds. 

        "Fair Value" shall mean, with respect to any portion of the Net Profits Interest to be released pursuant to Section 5.2 in
connection with a sale or release of any Subject Interest, an amount equal to the excess of (i) the proceeds which could reasonably be expected to be obtained from the sale of such portion of
the Net Profits Interest to a party which is not an Affiliate of either Grantor or the Trust on an arms'-length negotiated basis, taking into account relevant market conditions and factors existing at
the time of any such proposed sale or release, over (ii) Grantee's proportionate share of any sales costs, commissions and brokerage fees. 

2

 

        "Farmout Agreement" shall mean any farmout agreement, participation agreement, exploration agreement, development agreement or any similar
agreement. 

        "Gas" shall mean natural gas and other gaseous hydrocarbons or minerals, including helium, but excluding any Gas Liquids. 

        "Gas Liquids" shall mean those natural gas liquids and other liquid hydrocarbons, including ethane, propane, butane and natural gasoline,
and mixtures thereof, that are removed from a Gas stream by the liquids extraction process of any field facility or gas processing plant and delivered by the facility or plant as natural gas liquids. 

        "Grantee" shall mean Grantee as defined in the first paragraph of this Conveyance, and its successors and assigns; and, unless the context
in which used shall otherwise require, such term shall include any successor owner at the time in question of any or all of the Net Profits Interest. 

        "Grantor" shall mean MV Partners, LLC and its successors and assigns; and, unless the context in which used shall otherwise require, such
term shall include any successor owner at the time in question of any or all of the Subject Interests. 

        "Hedge" shall mean any commodity hedging transaction pertaining to Minerals, whether in the form of (i) forward sales and options
to acquire or dispose of a futures contract solely on an organized commodities exchange, (ii) derivative agreements for a swap, cap, collar or floor of the commodity
price, or (iii) similar types of financial transactions classified as "notional principal contracts" pursuant to Treasury Regulation § 1.989-1T(a)(2). 

        "Hedge Settlement Costs" shall mean any and all payments required to be made by Grantor to the counterparties in connection with the
settlement or mark-to-market of trades made under any Existing Hedge and all payments made by Grantor for any early termination of any Existing Hedge. 

        "Lease" shall mean (i) a lease of one or more Minerals described in Exhibit A attached hereto as to all lands and depths
described in such lease (or the applicable part or portion thereof if limited in depth and/or areal extent in Exhibit A) and any interest therein and any leasehold interest in any other lease
of Minerals derived from the pooling or unitization of such lease (or portion thereof if limited on Exhibit A) with other leases, together with any interest acquired or maintained by Grantor in
any and all extensions of such lease, (ii) any replacement lease taken upon or in anticipation of termination of such lease (if executed and delivered during the term of or within one year
after the expiration of the predecessor lease), as to all lands and depths described in the predecessor lease (unless the extended or predecessor lease is specifically limited in depth or areal extent
in Exhibit A, in which event only the corresponding portion of such lease shall be considered a renewal or extension or a replacement lease subject to this Conveyance), and (iii) any
other Mineral leasehold, royalty, overriding royalty or Mineral fee interest described in Exhibit A attached hereto; and "Leases" shall mean all such leases and all such renewal and extensions
and replacement leases. 

        "LLC Agreement" shall have the meaning given such term in Section 3.1(b)(i). 

        "Manufacturing Costs" shall mean the costs of Processing that generate Manufacturing Proceeds received by Grantor. 

        "Manufacturing Proceeds" shall mean the excess, if any, of (i) proceeds received by Grantor from the sale of Subject Minerals that
are the result of any Processing over (ii) the part of such proceeds that represents the Market Value of such Subject Minerals before any Processing. 

        "Market Value" of any Subject Minerals shall mean: 

        (a)   With
respect to Oil and Gas Liquids, (i) the highest price available to Grantor for such Oil and Gas Liquids at the Lease on the date of delivery pursuant to a
bona fide offer, posted price or other generally available marketing arrangement from or with a non-Affiliate purchaser, or (ii) if no 

3

 

such
offer, posted price or arrangement is available, the fair market value of such Oil and/or Gas Liquids, on the date of delivery at the Lease, determined in accordance with generally accepted and
usual industry practices; 

        (b)   With
respect to Gas, (i) the price specified in any Production Sales Contract for the sale of such Gas or (ii) if such Gas cannot be sold pursuant to a
Production Sales Contract, (A) the average of the three highest prices (adjusted for all material differences in quality) being paid at the time of production for Gas produced from the same
field in sales between non-affiliated Persons (or, if there are not three such prices within such field, within a 50-mile radius of such field) but, for any Gas subject to
price restrictions established, prescribed or otherwise imposed by any governmental authority having jurisdiction over the sale of such gas, no more than the highest price permitted for such category
or type of gas after all applicable adjustments (including without limitation tax reimbursement, dehydration, compression and gathering allowances, inflation and other permitted escalations), or
(B) if subsection (b)(ii)(A) above is not applicable, the fair market value of such Gas, on the date of delivery, at the Lease, determined in accordance with generally accepted and usual
industry practices. 

        "Materials" shall mean materials, supplies, equipment and other personal property or fixtures located on or used in connection with the
Subject Interests. 

        "Mcf" shall mean one thousand cubic feet. 

        "Minerals" shall mean Oil, Gas and Gas Liquids. 

        "MMBOE" shall mean one million BOE. 

        "Net Profits" shall have the meaning given such term in Section 3.2(b). 

        "Net Profits Account" shall mean the account maintained in accordance with the provisions of Section 3.1. 

        "Net Profits Interest" shall have the meaning given such term in Article I. 

        "Net Profits Period" shall mean the period from and after the Effective Time until and including the Termination Date. 

        "Oil" shall mean crude oil, condensate and other liquid hydrocarbons recovered by field equipment or facilities, excluding Gas Liquids. 

        "Payment Period" shall mean a calendar quarter, provided that the first Payment Period
shall mean the period from and after the Effective Time until December 31, 2006, and the last Payment Period shall mean any portion of the calendar quarter during which the Termination Date
occurs from the beginning of such calendar quarter until and including the Termination Date. 

        "Permitted Encumbrances" shall mean the following whether now existing or hereinafter created but only insofar as they cover, describe or
relate to the Subject Interests or the lands described in any Lease: 

        (a)   the
terms, conditions, restrictions, exceptions, reservations, limitations and other matters contained in the agreements, instruments and documents that create or
reserve to Grantor its interests in any of the Leases, including any Prior Reversionary Interest; 

        (b)   any
(i) undetermined or inchoate liens or charges constituting or securing the payment of expenses that were incurred incidental to maintenance, development,
production or operation of the Leases or for the purpose of developing, producing or processing Minerals therefrom or therein, and (ii) materialman's, mechanics', repairman's, employees',
contractors', operators' or other similar liens or charges for liquidated amounts arising in the ordinary course of business that Grantor has agreed to pay or is contesting in good faith in the
ordinary course of business; 

4

 

        (c)   any
liens for taxes and assessments not yet delinquent or, if delinquent, that are being contested in good faith in the ordinary course of business; 

        (d)   any
liens or security interests created by law or reserved in any Lease for the payment of royalty, bonus or rental, or created to secure compliance with the terms of
the agreements, instruments and documents that create or reserve to Grantor its interests in the Leases; 

        (e)   any
obligations or duties affecting the Leases to any municipality or public authority with respect to any franchise, grant, license or permit, and all applicable laws,
rules, regulations and orders of any governmental authority; 

        (f)    any
(i) easements, rights-of-way, servitudes, permits, surface leases and other rights in respect of surface operations, pipelines,
grazing, hunting, lodging, canals, ditches, reservoirs or the like, and (ii) easements for streets, alleys, highways, pipelines, telephone lines, power lines, railways and other similar
rights-of-way, on, over or in respect of the lands described in the Leases, provided that, in the case of clauses (i) and
(ii), such easements, rights-of-way, servitudes, permits, surface leases and other rights do not materially impair the value of the Net Profits Interest; 

        (g)   all
lessors' royalties, overriding royalties, net profits interests, carried interests, production payments, reversionary interests and other burdens on or deductions
from the proceeds of production created or in existence as of the Effective Time; 

        (h)   preferential
rights to purchase or similar agreements and required third party consents to assignments or similar agreements; 

        (i)    all
rights to consent by, required notices to, filings with, or other actions by any governmental authority in connection with the sale or conveyance of the Leases or
interests therein; 

        (j)    production
sales contracts; division orders; contracts for sale, purchase, exchange, refining or processing of Minerals; unitization and pooling designations,
declarations, orders and agreements; operating agreements; agreements for development; area of mutual interest agreements; gas balancing or deferred production agreements; processing agreements; plant
agreements; pipeline, gathering and transportation agreements; injection, repressuring and recycling agreements; salt water or other disposal agreements; seismic or geophysical permits or agreements;
and any and all other agreements entered into by Grantor or its Affiliates in connection with the exploration or development of the Leases or the extraction, processing or marketing of production
therefrom or to which any of the Leases were subject when acquired by Grantor or its Affiliates; and 

        (k)   conventional
rights of reassignment upon release or abandonment of property. 

        "Person" shall mean any individual, partnership, limited liability company, corporation, trust, unincorporated association, governmental
agency, subdivision, or instrumentality, or other entity or association. 

        "Possible Refundable Amounts" shall have the meaning set forth in Section 3.1(a)(v). 

        "Prime Interest Rate" shall mean the lesser of (a) the rate of interest per annum publicly announced from time to time by JPMorgan
Chase Bank, N.A. as its "prime rate" in effect at its principal office in New York City (each change in the prime rate to be effective on the date such change is publicly announced), with the
understanding that such bank's "prime rate" may be one of several base rates, may serve as a basis upon which effective rates are from time to time calculated for loans making reference thereto, and
may not be the lowest of such bank's base rates or (b) the maximum rate of interest permitted under applicable law. 

        "Prior Reversionary Interest" shall mean any contract, agreement, Farmout Agreement, lease, deed, conveyance or operating agreement that
exists as of the Effective Time or that burdened the Subject Interests at the time such Subject Interests were acquired by Grantor, that by the terms thereof 

5

 

requires
a Person to convey a part of the Subject Interests to another Person or to permanently cease production of any Subject Well, including obligations arising pursuant to any operating
agreements, Leases, coal leases, and other similar agreements or instruments affecting the Subject Interests. 

        "Proceeds Percentage" shall mean eighty percent (80%). 

        "Processing" or "Processed" shall mean to manufacture, fractionate or refine Subject
Minerals, but such terms do not mean or include activities involving the use of normal lease or well equipment (such as dehydrators, gas treating facilities, mechanical separators, heater-treaters,
lease compression facilities, injection or recycling equipment, tank batteries, field gathering systems, pipelines and equipment and so forth) to treat or condition Minerals or other normal operations
on any of the Subject Interests. 

        "Production Sales Contracts" shall mean all contracts, agreements and arrangements for the sale or disposition of Minerals. 

        "Quarterly Record Date" shall mean the 15th day (or the next Business Day, if the 15th day is not a Business
Day) of the first month following the close of each Payment Period. The first Quarterly Record Date shall be January 15, 2007. 

        "Related Party" shall mean either Vess Oil Corporation or Murfin Drilling
Company, Inc., as the case may be. 

        "Reserve Account" shall mean an account to be maintained by Grantor pursuant to Section 3.1;  provided that the balance in such account at any time shall not
exceed $1,000,000, and provided further
that amounts held in such account shall be expended by Grantor only with respect to the exploration, development, maintenance or operation of the Subject Interests and related activities. 

        "Subject Interests" shall mean each kind and character of right, title, claim, or interest (collectively the "rights"), that Grantor has
or owns in the Leases whether such right be under or by virtue of a lease, a unitization or pooling order, an operating agreement, a division order, or a transfer order or be under or by virtue of any
other type of claim or title, legal or equitable, recorded or unrecorded, all as such rights shall be (a) enlarged or diminished by virtue of the provisions of Section 4.2, and
(b) enlarged by the discharge of any payments out of production or by the removal of any charges or encumbrances to which any of such rights are subject on the Effective Time
(provided that such removal is pursuant to the express terms of the instrument that created such charge or encumbrance) and any and all renewals and
extensions of the right occurring within one year after the expiration of such rights. 

        "Subject Minerals" shall mean all Minerals in and under and that may be produced, saved, and sold from, and are attributable to, the
Subject Interests from and after the Effective Time, after deducting the appropriate share of all royalties and any overriding royalties, production payments and other similar charges (except the Net
Profits Interest) burdening the Subject Interests at the Effective Time, provided that, (a) there shall not be included in the Subject Minerals
(i) any Minerals attributable to non-consent operations conducted with respect to the Subject Interests (or any portion thereof) as to which Grantor shall be a
non-consenting party as of the Effective Time that are dedicated to the recoupment or reimbursement of costs and expenses of the consenting party or parties by the terms of the relevant
operating agreement, unit agreement, contract for development, or other instrument providing for such non-consent operations (including any interest, penalty or other amounts related
thereto), or (ii) any Minerals unavoidably lost in production or used by Grantor for production operations (including without limitation, fuel, secondary or tertiary recovery) conducted solely
for the purpose of producing Subject Minerals from the Subject Interests and (b) there shall be included in the Subject Minerals any Minerals attributable to non-consent operations
conducted with respect to the Subject Interests (or any portion thereof) as to which Grantor shall be a non-consenting party as of the Effective Time that are produced, saved, and sold
from, and are attributable to the Subject Interests after the Effective Time from and after the recoupment or reimbursement of costs and expenses (including any interest, penalty or other amounts
related thereto) of the consenting party or parties by the terms of the relevant operating agreement, unit agreement, contract agreement, contract development, or other instruments providing for such
non-consent operations. 

6

  

        "Subject Well" shall mean each well on the Subject Interests in respect of which Grantor owns any interest or is entitled to any of the
Minerals production or the proceeds therefrom (whether directly or indirectly by virtue of the effect of any farmout or farmin provisions or other provisions). 

        "Termination Date" shall mean the later of (a) June 30, 2026 and (b) the day on which the total volume of the Subject
Minerals (including any Subject Minerals produced from the Subject Interests Transferred by Grantor pursuant to Section 5.1 hereof) produced, saved and sold from and after July 1, 2006
equals a volume of (i) 14.393950 MMBOE less (ii) the aggregate volume of proved reserves attributable to the Subject Interests that are Transferred by Grantor pursuant to
Section 5.2 hereof (with the volume of proved reserves attributable to any individual Subject Interest so Transferred determined solely by reference to the quantity of reserves attributable to
such Subject Interest that are expected to be produced during the term of the Net Profits Interest in the most recent reserve report prepared by an independent reserve engineer in accordance with the
methodology specified in the rules and regulations of the Securities and Exchange Commission, provided that, in the event an independent reserve
engineer has not prepared a reserve report satisfying the foregoing requirements within 12 months prior to the date of the Transfer of such Subject Interest, no volume of proved reserves for
much Subject Interest shall be included in such aggregate volume pursuant to this clause (ii)). 

        "Third Party" shall mean any Person other than Grantor, Grantee or the Trust. 

        "Transfer" including its syntactical variants, shall mean any assignment, sale, transfer, conveyance, or disposition of any property;  provided, Transfer as used
herein does not include the granting of a security interest in Grantor's interest in any property, including the Subject
Interests or the Subject Minerals. 

        "Trust Units" shall have the meaning ascribed to such term in the Amended and Restated Trust Agreement of MV Oil Trust, dated of even date
herewith, by and among Grantor, Grantee and Wilmington Trust Company. 

 
 

ARTICLE III
  ESTABLISHMENT OF NET PROFITS ACCOUNT    
    

        3.1   Net Profits Account and Reserve Account. Grantor shall establish and maintain true and correct books and records in order
to determine the credits and debits to a Net Profits Account and a Reserve Account to be maintained by Grantor at all times during the Net Profits Period, in accordance with the terms of this
Conveyance and prudent and accepted accounting practices. For purposes of this Section 3.1: 

        (a)   The
Net Profits Account shall be credited with an amount equal to the sum, from and after the Effective Time with respect to each Payment Period, of the gross proceeds
(determined before calculating the Net Profits) received by Grantor from the sale of all Subject Minerals; provided, however, that: 

	(i)
	gross
proceeds shall include all consideration received, directly or indirectly, for Transfers of Subject Minerals as, if and when produced, including without limitation
(but subject to Section 3.1(a)(v)) advance payments and payments under take-or-pay and similar provisions of Production Sales Contracts;

	(ii)
	if
any proceeds are withheld from Grantor for any reason (other than at the request of Grantor), such proceeds shall not be considered to be gross proceeds until such
proceeds are actually received by Grantor;

	(iii)
	if
Grantor becomes an underproduced party under any Gas balancing or similar arrangement affecting the Subject Interests, then the Net Profits Account shall not be
credited with any amounts for any Gas attributable to the Subject Interests that is deemed to be stored for 

7

 

Grantor's
account under the terms of such Gas balancing arrangement, and if Grantor becomes an overproduced party under any Gas balancing or similar arrangement affecting the Subject Interests, then
the Net Profits Account shall not be credited with any amount for any Gas taken by an underproduced party as "make-up" Gas that would otherwise be attributable to the Subject Interests.
The Net Profits Account shall be credited with amounts received by Grantor (1) for any "make up" Gas taken by Grantor as a result of its position as an underproduced party under any Gas
balancing or similar arrangement affecting the Subject Interests, (2) as a balancing of accounts under a Gas balancing or other similar arrangement affecting the Subject Interests either as an
interim balancing or at the depletion of the reservoir, and (3) for any Gas taken by Grantor attributable to the Subject Interests in excess of its entitlement share of such Gas; 

	(iv)
	if
Grantor shall be a party as to any non-consent operations conducted with respect to all or any of the Subject Interests from and after the Effective
Time, all gross proceeds to be credited to the Net Profits Account with respect thereto shall be governed by Section 4.3;

	(v)
	if
a controversy or possible controversy exists (whether by reason of any statute, order, decree, rule, regulation, contract, or otherwise) as to the correct or lawful
sales price of any Subject Minerals, or if any amounts received or to be received by Grantor as "take-or-pay" or "ratable take" payments are subject to refund to any purchasers
of Subject Minerals (in each case, such amounts together with any other gross proceeds withheld from, or repayable by, Grantor, "Possible Refundable
Amounts"), then:

	(A)
	amounts
withheld by such purchaser or deposited by it with an escrow agent shall not be considered to have been received by Grantor and shall not be credited to the Net Profits
Account until actually collected by Grantor; provided, however, that the Net Profits Account shall not be credited with any interest, penalty, or other
amount that is not derived from the sale of Subject Minerals; and

	(B)
	amounts
received or to be received by Grantor and promptly deposited or to be deposited by it with a non-Affiliate escrow agent, to be placed in interest bearing accounts
under usual and customary terms, shall not be considered to have been received by Grantor and shall not be credited to the Net Profits Account until actually disbursed to Grantor by such escrow agent;  provided, however, that the Net Profits Account shall not be credited with any interest, penalty, or other amount that is not derived from the sale of
Subject Minerals;

	(vi)
	gross
proceeds shall not include any amount received by Grantor in respect of any production of Subject Minerals prior to the Effective Time;

	(vii)
	the
Net Profits Account shall not be credited with any amount that Grantor shall receive for any sale or other disposition of any of the Subject Interests or in
connection with any adjustment of any well and leasehold equipment upon unitization of any of the Subject Interests;

	(viii)
	gross
proceeds shall not include any Manufacturing Proceeds or other amounts that are reductions of debits to the Net Profits Account under the proviso of
Section 3.1(b);

	(ix)
	in
the event that Subject Minerals are Processed prior to sale, gross proceeds shall include only the Market Value of such Subject Minerals before any such Processing;

	(x)
	the
amount of gross proceeds credited to the Net Profits Account during any Payment Period shall be reduced by (1) the aggregate Hedge Settlement Costs paid by
Grantor with respect to such Payment Period and (2) overpayments pursuant to Section 3.4; 

8

 

	(xi)
	gross
proceeds shall not include any amount to which Grantor is entitled by virtue of a judgment of a court of competent jurisdiction resolving a dispute hereunder
between Grantee and Grantor in favor of Grantor, or any amount paid to Grantor in settlement of such dispute; and

	(xii)
	gross
proceeds shall not include any additional proceeds from the sale of Minerals related to any Subject Well with respect to which Grantor elects to be a
participating party (whether pursuant to an operating agreement or other agreement or arrangement, including without limitation, non-consent rights and obligations imposed by statute or
regulatory agency) with respect to any operation with respect to such Subject Well where another party or parties have elected not to participate in such operation (or have elected to abandon such
Subject Well) and Grantor elects to pay the costs of such nonparticipating or abandoning party and as a result of which Grantor becomes entitled to receive, either temporarily (i.e., through a period
of recoupment) or permanently any additional proceeds from the sale of Minerals related to such Subject Well. 

        (b)   The
Net Profits Account shall be debited with an amount equal to the sum of the following (excluding in all events Manufacturing Costs and Hedge Settlement Costs), to
the extent that the same are properly allocable to the Subject Interests (and any related equipment or property used in connection therewith) and the production and (subject to Section 4.5)
marketing of Subject Minerals therefrom and have been incurred or accrued (as described below) by Grantor from and after the Effective Time and attributable to periods ending on or before the
Termination Date: 

	(i)
	all
direct costs (including capital costs) paid by Grantor (A) for all direct labor (including fringe benefits) and other services necessary for exploring,
developing, operating, producing, reworking and maintaining the Subject Interests, (B) for dehydration, compression, separation and transportation of the Subject Minerals, and (C) for
all Materials purchased for use on, or in connection with, any of the Subject Interests (including without limitation (1) all amounts charged Grantor for conformance of investment if the
Subject Interests or any part or parts thereof are hereafter from time to time unitized or if any participating area in a federal divided-type unit is changed, (2) the costs of any
seismic (including 3-D seismic surveys), geological or geophysical operations relating to the search for Subject Minerals, (3) the costs of drilling, completing, testing, equipping,
plugging back, reworking, recompleting and plugging and abandoning any well on the Subject Interests, whether or not such well is a producer or is abandoned as a dry hole or junked, (4) the
cost of constructing gathering facilities, tanks and other production and delivery facilities on the Subject Interests, and (5) the cost of secondary recovery, pressure maintenance,
repressuring, recycling and other operations conducted for the purpose of enhancing production); provided, however, that the debits made to the Net
Profits Account pursuant to this subsection (and, to the extent applicable, pursuant to the other applicable provisions of this Conveyance) with respect to any Subject Interest shall be made on the
same basis as such costs are charged under the operating agreement (if any) applicable to such Subject Interest at the time the transaction giving rise to such debit occurred, except that
(I) in the case where Grantor, a Related Party or one of Grantor's Affiliates acts as operator of any Subject Interest, the costs (including overhead charges) debited to the Net Profits Account
with respect to such Subject Interest shall not exceed the charges determined in accordance with the applicable provisions of the First Amended and Restated Operating Agreement of MV Partners LLC
dated September 1, 2006 between MV Energy, LLC and VAP-1, LLC, as currently in effect (the "LLC Agreement"); and (II) in the
event a Subject Interest is operated at such time by a non-Affiliate of Grantor but is not subject to an operating agreement, such debit shall be made on the same basis as Grantor is
charged by such non-Affiliate of Grantor; provided, further, if Grantor elects to pay the
costs of a nonconsenting party or nonparticipating party 

9

 

with
respect to which the Net Profits Account is not credited pursuant to Section 3.1(a), Grantor shall be solely responsible for such costs; 

	(ii)
	all
costs (including without limitation outside legal, accounting and engineering services) attributable to the Subject Interests of (A) handling, investigating
and/or settling litigation, administrative proceedings and claims (including without limitation lien claims other than liens for borrowed funds) and (B) payment of judgments, penalties and
other liabilities (including interest thereon), paid by Grantor (and not reimbursed under insurance maintained by Grantor or others) and involving any of the Subject Interests, or incident to the
development, operation or maintenance of the Subject Interests, or requiring the payment or restitution of any proceeds of Subject Minerals, or arising from tax or royalty audits, except that there
shall not be debited to the Net Profits Account any expenses incurred by Grantor in litigation of any claim or dispute arising hereunder between Grantor and Grantee or amounts paid by Grantor to
Grantee pursuant to a final order entered by a court of competent jurisdiction resolving any such claim or dispute or amounts paid by Grantor to Grantee in connection with the settlement of any such
claim or dispute;

	(iii)
	all
taxes (except federal and state income, transfer, mortgage, inheritance, estate, franchise and like taxes) incurred, accrued or paid by Grantor with respect to the
ownership of the Subject Interests or the extraction of the Subject Minerals, including without limitation production, severance, and/or excise and other similar taxes assessed against, and/or
measured by, the production of (or the proceeds or value of production of) Subject Minerals, occupation taxes, sales and use taxes, and ad valorem taxes assessed against or attributable to the Subject
Interests or any equipment used in connection with production from any of the Subject Interests and any extraordinary or windfall profits taxes that may be assessed in the future based upon profits
realized or prices received from the sale of Subject Minerals; provided, however, that if Grantee is assessed any of such taxes individually and Grantee
pays such taxes, then the taxes which Grantee is assessed individually and has paid shall not be debited to the Net Profits Account;

	(iv)
	insurance
premiums attributable to the ownership or operation of the Subject Interests paid by Grantor for insurance actually carried for periods after the Effective
Time with respect to the Subject Interests, or any equipment located on any of the Subject Interests, or incident to the development, operation or maintenance of the Subject Interests, it being
recognized that where the coverage is general in nature, or relates to a group of properties (or more than one interest in the same property), only that portion which is reasonably allocated to the
Subject Interests shall be debited hereunder;

	(v)
	all
amounts paid by Grantor attributable to the Subject Interests and consisting of (A) rent and other consideration paid for the use or damage to the surface,
(B) delay rentals, shut-in well payments, minimum royalties and similar payments paid pursuant to the provisions of agreements in force and effect before the Effective Time and
(C) fees for renewals or extensions of the Leases included in the Subject Interests;

	(vi)
	amounts
attributable to the Subject Interests and charged by the relevant operator (including those amounts charged to Grantor by any Related Party) as overhead charges
specified in applicable operating agreements or other arrangements now or hereafter covering the Subject Interests or Grantor's operations with respect thereto (subject to the first proviso in
Section 3.1(b)(i));

	(vii)
	if
as a result of the occurrence of the bankruptcy or insolvency or similar occurrence of the purchaser of Subject Minerals any amounts previously credited to the Net
Profits Account are reclaimed from Grantor or its representative, then the amounts reclaimed as promptly as practicable following Grantor's payment thereof; 

10

 

	(viii)
	if
Grantor shall be a party as to any non-consent operations conducted with respect to all or any of the Subject Interests, all costs related to such
non-consent operations to be debited to the Net Profits Account with respect thereto shall be governed by Section 4.3;

	(ix)
	the
costs paid by Grantor in connection with the exercise of its rights pursuant to Section 4.6;

	(x)
	all
costs paid by Grantor for recording this Conveyance;

	(xi)
	all
Administrative Hedge Costs paid by Grantor;

	(xii)
	without
duplication of the costs described in (ix) above, all other direct costs paid by Grantor for the necessary or proper drilling, completion, hook up,
production, operation, reworking, recompleting and maintenance of the Subject Wells and Subject Interests, and the plugging and abandoning of any unplugged Subject Wells located on the Subject
Interests, abandoning of any facilities used in connection with the Subject Interests and, where applicable, restoring of the surface of the Subject Interests;

	(xiii)
	any
Debit Balance carried forward pursuant to Section 3.2(c); and

	(xiv)
	the
amount of any increase in the Reserve Account related to projected costs of scheduled future capital expenditure projects, including well drilling, recompletion
and workover costs that have been approved by Grantor in writing; 

provided that the costs referred to in this Section 3.1(b) shall be reduced by the following amounts received by Grantor from and after the
Effective Time: (A) any amounts received by Grantor as delay rentals, bonus, royalty or other similar payments in connection with any Farmout Agreement or for dry hole, bottom hole or other
similar contributions related to the Subject Interests or otherwise, (B) upon salvage or other disposition, the applicable actual salvage value (as determined in accordance with the applicable
operating agreement then in effect and binding upon Grantor) of any Eligible Materials, less, in each instance the actual costs of salvage or other disposition, (C) any cash payments received
by Grantor as a result of any pooling or unitization of the Subject Interests if the costs giving rise to such payments were charged to the Net Profits Account, directly or indirectly, (D) any
insurance proceeds
received by Grantor in respect of the Subject Interests, Subject Minerals or Eligible Materials if the cost of such insurance was charged to the Net Profits Account, directly or indirectly,
(E) any amounts received by Grantor from third parties as rental or use fees for Eligible Materials, (F) the gross proceeds of any judgments or claims received by Grantor for damages
occurring on or after the Effective Time to the Subject Interests (or any part thereof or interest therein) or any Materials (or any part thereof or interest therein) used in connection with the
operation of the Subject Interests or any Subject Minerals, (G) any proceeds from the sale of Eligible Materials, (H) any payments made to Grantor in connection with the drilling or
deferring of drilling of any Subject Well, (I) if, from and after the Effective Time, any Subject Minerals shall be Processed before sale, the excess, if any, of the Manufacturing Proceeds
arising therefrom over the Manufacturing Costs of such Processing, (J) any interest, penalty or other amount not derived from the sale of the Subject Minerals that is paid to Grantor by the
purchaser of production or escrow agent in connection with Possible Refundable Amounts withheld or deposited with an escrow agent, and (K) any amounts in the Reserve Account that are used to
pay for any costs specified in clauses (i) through (xii) of this Section 3.1(b) (which amounts so used shall reduce the amount of the Reserve Account); and  provided further that
(1) during each 12-month period beginning on the Capital Expenditure Limitation Date, the sum of (x) the
capital expenditures to be debited to the Net Profits Account and (y) the amounts debited to the Net Profits Accounts pursuant to Section 3.1(b)(xiii) may not exceed the Average
Annual Capital Expenditure Amount, and (2) any amounts in the Reserve Account referred to in Section 3.1(b)(xiii) immediately preceding the Termination Date shall be credited to
Net Profits Account as of the Termination Date. 

        (c)   Notwithstanding
anything herein to the contrary, the amounts debited to the Net Profits Account shall not include any of the following: (A) any amount that has
also been used to reduce or 

11

 

offset
the amount of the Subject Minerals (or proceeds of production thereof) or has otherwise not been included therein (including, by way of example and without limitation, proceeds attributable to
royalties, overriding royalties, production payments and other charges burdening the Subject Interests at the Effective Time); (B) any overriding royalty, production payment or other charge
burdening the Subject Interests which was created by Grantor after the Effective Date; (C) any general, administrative or overhead costs paid or incurred by Grantor or its Affiliates, except
for those permitted under Section 3.1(b)(vi); (D) any amounts paid by Grantor (initial or a successor) to such Grantor's predecessor in
interest with respect to part or all of the Subject Interests (including without limitation any purchase price or other consideration paid by Grantor to such predecessor in interest to acquire all or
part of the Subject Interests); and (E) any interest, premiums, fees or similar charges arising out of borrowings or purchases of any goods, equipment or other items on credit, whether or not
used on or otherwise related to the Subject Interests. 

        (d)   Nothing
set forth in this Section 3.1 shall be interpreted or applied in any manner that shall ever require or permit any duplication of all or any part of any
credit or debit (or reduction thereto) to the Net Profits Account with respect to the same transaction, item of expense or charge, under this Conveyance, or that shall ever require or permit any
inclusion of any charge to the Net Profits Account that is reimbursed to Grantor by any Person. 

        (e)   GRANTEE, BY ITS ACCEPTANCE OF THE NET PROFITS INTEREST, CLEARLY AND UNEQUIVOCALLY EXPRESSES ITS INTENT THAT THE DEBITS TO THE NET PROFITS ACCOUNT
CONTAINED IN SECTION 3.2(b) SHALL BE APPLICABLE REGARDLESS OF WHETHER OR NOT THE LOSSES, COSTS, EXPENSES AND DAMAGES THAT MAY BE DEBITED IN ACCORDANCE WITH SUCH SECTION AROSE SOLELY OR IN PART FROM
THE ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OF GRANTOR OR ANY OF ITS AFFILIATES, OTHER THAN THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF GRANTOR OR ANY OF ITS
AFFILIATES, EXCEPT TO THE EXTENT THAT ANY SUCH LOSSES, COSTS, EXPENSES OR DAMAGES RESULT, DIRECTLY OR INDIRECTLY, FROM ANY BREACH OR NONCOMPLIANCE WITH THE OPERATIONS STANDARD SET FORTH IN SECTION 4.1
HEREOF, AND NOTHING CONTAINED HEREIN OR ELSEWHERE IN THIS CONVEYANCE SHALL BE CONSTRUED AS A WAIVER OR RELEASE OF GRANTOR FROM ANY CLAIM, ACTION OR LIABILITY ARISING UNDER SECTION 4.1
HEREOF.

        3.2   Accounting. 

        (a)   At
the end of each Payment Period, a calculation of net profits shall then be made by Grantor by deducting (i) the total debits (and reductions thereof) properly
made to the Net Profits Account during such Payment Period pursuant to Section 3.1(b) from (ii) the total credits properly made to such Net Profits Account during such Payment Period
pursuant to Section 3.1(a). 

        (b)   If
the computation made in accordance with Section 3.1(a) results in a positive amount with respect to a Payment Period (the "Net
Profits"), then (i) that positive amount shall be subtracted from the balance of the Net Profits Account to cause the Net Profits Account to have a zero balance
immediately following the end of such Payment Period, (ii) that positive amount shall be multiplied by the Proceeds Percentage to determine the Net Profits Interest and (iii) the
resulting product from the calculations in (ii) above shall be payable to Grantee as specified in Section 3.3. 

        (c)   If
the computation made in accordance with Section 3.2(a) results in a negative amount with respect to a Payment Period, the negative sum shall be deemed the
"Debit Balance." Any Debit Balance shall be carried forward as a debit to the Net Profits Account for the following Payment Period. If there is a Debit
Balance at the end of any Payment Period, no payments shall be made to Grantee in respect of the Net Profits Interest nor shall Grantee ever be liable to make any payment to Grantor in respect of the
Debit Balance. In the event that any Debit Balance exists, then an amount shall be computed equal to interest on such Debit Balance at the Prime Interest Rate for the period between the last day of
the Payment Period that resulted in such Debit Balance and the last day of the next Payment Period, which amount shall, on the last day of such next Payment Period, be debited to the Net Profits
Account in the same manner as other debits to the Net Profits Account for such Payment Period. 

12

  

        (d)   All amounts received by Grantor from the sale of the Subject Minerals for any Payment Period shall be held by Grantor in one of its general bank accounts and Grantor
shall not be required to maintain a segregated account for such funds. 

        3.3   Payment of Proceeds Percentage of Net Profits. On or before the fifth Business Day following the Quarterly Record Date
for each Payment Period, Grantor shall transfer or cause to be transferred to Grantee an amount in respect of the Subject Interests equal to the product of the Proceeds Percentage times the Net
Profits with respect to the immediately preceding Payment Period in accordance with Section 3.2(b). All funds delivered to Grantee on account of the Net Profits Interest shall be calculated and
paid entirely and exclusively out of the gross proceeds attributable to the Subject Minerals attributable to the Subject Interests. 

        3.4   Overpayment; Past Due Payments. If Grantor ever pays Grantee more than the amount of money then due and payable to
Grantee under this Conveyance, Grantee shall not be obligated to return the overpayment, but Grantor may at any time thereafter reduce the gross proceeds used to calculate the Net Profits and retain
for its own account an amount equal to the overpayment, plus interest at the Prime Interest Rate on such amount, commencing on the sixth (6th) day from the date of the overpayment to the date such
amount is recovered by Grantor from such proceeds. Any amount not paid by Grantor to Grantee with respect to the Net Profits Interest when due shall bear, and Grantor hereby agrees to pay, interest at
the Prime Interest Rate from the due date until such amount has been paid. Grantor shall give Grantee written notice with respect to any underpayment or overpayment described in this
Section 3.4, together with supporting worksheets and data. 

        3.5   Statements. 

        (a)   On
each Quarterly Record Date, Grantor shall deliver to Grantee a statement showing the computation of the Net Profits and the Proceeds Percentage of the Net Profits,
including gross proceeds and debits therefrom (including any reductions to such gross proceeds and/or debits), with respect to the preceding Payment Period. 

        (b)   On
the first Quarterly Record Date after the end of each calendar year and on the Quarterly Record Date after the Termination Date, such statement shall also show the
computation of the Net Profits and the Proceeds Percentage of the Net Profits, including gross proceeds and debits therefrom (including any reductions to such gross proceeds and/or debits), for the
preceding calendar year (or portion thereof when the Net Profits Interest was in effect). 

        (c)   If
Grantee takes exception to any item or items included in any quarterly statement required by Section 3.5(a), Grantee must notify Grantor in writing within one
hundred and twenty (120) days after the end of the fiscal year with respect to which such statements relate. Such notice must set forth in reasonable detail the specific debits complained of
and to which exception is taken or the specific credits which should have been made and allowed. Adjustments shall be made for all complaints and exceptions that are agreed to by the parties;  provided
that if the parties do not agree, such disputed matters shall be subject to the arbitration provisions set forth in Article XI of the
Amended and Restated Trust Agreement of MV Oil Trust dated of even date herewith by and among Grantor, Wilmington Trust Company, a banking corporation organized under the laws of the State of
Delaware, and Grantee. 

        (d)   Notwithstanding
anything to the contrary herein, all matters reflected in Grantor's statements for the preceding calendar year (or portion thereof) that are not objected
to by Grantee in the manner provided by this Section 3.5(c) shall be deemed correct as rendered by Grantor to Grantee. 

        3.6   Information/Access. 

        (a)   Grantor
shall maintain true and correct books, records, and accounts of (i) all transactions required or permitted by this Conveyance and (ii) the
financial information necessary to effect such 

13

 

transactions,
including the financial information needed to calculate the Net Profits with respect to any Payment Period. 

        (b)   Grantee
or its representative, at the Trust's expense, may inspect and copy such books, records, and accounts in the offices of Grantor during normal business hours and
upon reasonable notice. 

        (c)   At
Grantee's request, subject to applicable restrictions on disclosure and transfer of information, Grantor shall give Grantee and its designated representatives (on
behalf of the Trust) reasonable access in Grantor's office during normal business hours to (i) all geological, Subject Well and production data in Grantor's possession or Grantor's Affiliates'
possession, relating to operations on the Subject Interests and (ii) all reserve reports and reserve studies in the possession of Grantor or of Grantor's Affiliates, relating to the Subject
Interests, whether prepared by Grantor, by Grantor's Affiliates, or by consulting engineers. 

        (d)   Grantor
makes no representations or warranties about the accuracy or completeness of any such data, reports, or studies referred to in Section 3.6(c) and shall
have no liability to Grantee, the Trust or any other Person resulting from such data, studies, or reports. 

 
 

ARTICLE IV
  OPERATION OF THE SUBJECT INTERESTS    
    

        4.1   Operations Standard. To the extent that Grantor controls such matters and notwithstanding anything to the contrary
herein, Grantor agrees that it will conduct and carry on, or cause to be conducted and carried on, the exploration, development, maintenance and operation of the Subject Interests in the same manner
as a reasonably prudent operator in the State of Kansas would do under the same or similar circumstances acting with respect to its own properties (without regard to the existence of the Net Profits
Interest); provided that in no event shall Grantor be deemed in breach of the foregoing standard in connection with costs or charges paid by Grantor to
any Related Party for operations with respect to the Subject Interests in accordance with Sections 5.5 and 5.6 of the LLC Agreement. Grantee acknowledges that Grantor is and shall be an undivided
interest owner with respect to the Subject Interests. Grantee agrees that the acts or omissions of Grantor's co-owners shall not be deemed to constitute a violation of the provisions of
this Section 4.1, nor shall any action required by a vote of co-owners be deemed to constitute such a violation so long as Grantor has voted its interest in a manner designed to
comply with this Section 4.1. Nothing contained in this Section 4.1 shall be deemed to prevent or restrict Grantor from electing not to participate in any operations that are to be
conducted under the terms of any operating agreement, unit operating agreement, contract for development, or similar instrument affecting or pertaining to the Subject Interests (or any portion
thereof) and permitting consenting parties to conduct non-consent operations thereon if a reasonably prudent operator in the State of Kansas acting with respect to its own properties
(without regard to the existence of the Net Profits Interest) would make such elections. 

        4.2   Pooling and Unitization. Grantor shall have the right to pool or unitize all or any of the Leases as to any one or more
of the formations or horizons thereunder, and as to any of the Subject Minerals, when, in the reasonable judgment of Grantor, it is necessary or advisable to do so in order to form a drilling
or proration unit to facilitate the orderly development of the Subject Interests or to comply with the requirements of any law or governmental order or regulation relating to the spacing of wells or
proration of the production therefrom. For purposes of computing the Net Profits, there shall be allocated to the Subject Interests included in such unit a pro rata portion of the Minerals produced
from the pooled unit on the same basis that production from the pool or unit is allocated to other working interests in such pool or unit. The interest in any such unit attributable to the Subject
Interests (or any part thereof) included therein shall become a part of the Subject Interests and shall be subject 

14

 

to
the Net Profits Interest in the same manner and with the same effect as if such unit and the interest of Grantor therein were specifically described in Exhibit A to this Conveyance. 

        4.3   Non-Consent. If Grantor elects to be a non-participating party (whether pursuant to an operating
agreement or other agreement or arrangement, including without limitation, non-consent rights and obligations imposed by statute or regulatory agency) with respect to any operation on any
Subject Interest or elects to be an abandoning party with respect to a Subject Well located on any Subject Interest, the consequence of which election is that Grantor's interest in such Subject
Interest or part thereof is temporarily (i.e., during a recoupment period) or permanently forfeited to the parties participating in such operations, or electing not to abandon such Subject Well, then
the costs and proceeds attributable to such forfeited interest shall not, for the period of such forfeiture (which may be a continuous and permanent period), be debited or credited to the Net Profits
Account and such forfeited interest shall not, for the period of such forfeiture, be subject to the Net Profits Interest. Notwithstanding anything to the contrary contained herein, Grantor shall not
elect, as to any Subject Interest, to be a non-participating party with respect to any operation contemplated in this Section 4.3 in the event any Affiliate of Grantor will also be
a participating party in such operation. 

        4.4   Marketing/Hedges. As between Grantor and Grantee, Grantor shall have exclusive charge and control of the marketing of all
Subject Minerals allocable to the Net Profits Interest. Grantor shall market the Subject Minerals allocable to the Net Profits Interest in the same manner that it markets its Subject Minerals and
Grantor shall not be entitled to deduct from the calculation of the Net Profits any fee for marketing the Subject Minerals allocable to the Net Profits Interest. Grantor shall not enter into any
Hedges (other than the Existing Hedges) with respect to the Subject Minerals from and after the Effective Time. 

        4.5   Amendment of Leases. Grantor shall have the unrestricted right to renew, extend, modify, amend, or supplement the Leases
with respect to any of the lands covered thereby in any particular without the consent of Grantee; provided, that the Net Profits Interest shall apply
to all renewals, extensions, modifications, amendment, supplements and other similar arrangements (and/or interests therein) of the Leases, whether or not such renewals, extensions modifications,
amendment, supplements or arrangements have heretofore been obtained, or are hereafter obtained, by Grantor and no renewal, extension, modification, amendment, or supplementation shall adversely
affect any of Grantee's rights hereunder, including, without limitation, the amount, computation, or method of payment of the Net Profits Interest;  provided further that any fees payable with respect to
such renewal, extension, modification, amendment or supplementation may be debited to the Net
Profits Account pursuant to Section 3.1(b). Grantor shall furnish Grantee with written notice of any renewal, extension, modification, amendment, or supplementation, which materially affects
the Net Profits Interest within 30 days after Grantor has entered into the same, which notice shall specify the date thereof and the location and the acreage covered thereby. 

        4.6   Abandonment. Grantor shall have the right without the joinder of Grantee to release, surrender and/or abandon its
interest in the Subject Interests, or any part thereof, or interest therein even though the effect of such release, surrender or abandonment will be to release, surrender or abandon the Net Profits
Interest the same as though Grantee had joined therein insofar as the Net Profits Interest covers the Subject Interests, or any part thereof or interest therein, so released, surrendered or abandoned
by Grantor; provided, however, that Grantor shall not release, surrender or abandon any Subject Interest unless and until Grantor has determined (acting
like a reasonably prudent operator in the Mid-Continent region with respect to its own properties, without regard to the existence of the Net Profits Interest) that such Subject Interest
will no longer produce Subject Minerals in paying quantities; and provided further that Grantor will, at least thirty (30) days prior to the
release, surrender or abandonment of any Subject Interest, or any part thereof or interest therein, notify Grantee in writing, giving a description of each Subject Interest, or part thereof or
interest therein, proposed to be released, surrendered or abandoned, and the date upon which such release, surrender 

15

 

or
abandonment is projected to occur. Grantor shall have an unequivocal right to abandon the Subject Interests, or any part thereof if such abandonment is necessary for health, safety or environmental
reasons, or the Subject Minerals that would have been produced from the abandoned Subject Interests would otherwise be produced from Subject Wells located on the remaining Subject Interests. 

        4.7   Contracts with Affiliates. Grantor or its Affiliates may perform services and furnish supplies
and/or equipment with respect to the Subject Interests that are required to operate the Subject Interests in accordance with the operations standard set forth in Section 4.1 hereof and debit
the Net Profits Account for the costs of such services and/or furnishing of such supplies and/or equipment, provided that the terms of the provision of
such services or furnishing of supplies and/or equipment shall not be less favorable than those terms available from non-Affiliates in the area engaged in the business of rendering
comparable services or furnishing comparable equipment and supplies, taking into consideration all such terms, including the price, term, condition of supplies or equipment, availability of supplies
and/or equipment, and all other terms, and provided further that nothing in this Section 4.7 shall operate to prevent or limit any charges
debited to the Net Profits Accounts for costs or charges paid to any Related Party in accordance with Sections 5.5 and 5.6 of the LLC Agreement. 

 
 

ARTICLE V
  RELEASES AND TRANSFERS OF SUBJECT INTERESTS/SUBJECT WELLS    
    

        5.1   Assignment by Grantor Subject to Net Profits Interest. 

        (a)   Grantor
may from time to time Transfer, mortgage, or pledge the Subject Interests, or any part thereof or undivided interest therein, subject to the Net Profits Interest
and this Conveyance. 

        (b)   Upon
any Transfer of the Subject Interests, or any part thereof or undivided interest therein, by Grantor pursuant to this Section 5.1, Grantor may delegate to
its transferee all obligations, requirements, and responsibilities of Grantor arising under this Conveyance with respect to the property Transferred, but, as between Grantor and Grantee, Grantor shall
remain responsible therefor as if the Transfer had not taken place. 

        (c)   Grantee
is not entitled to receive any share of the sales proceeds received by Grantor in any transaction permitted by this Section 5.1. 

        (d)   For
purposes of computing Net Profits from and after the effective date of any Transfer pursuant to this Section 5.1, the Transfer shall be disregarded;  provided however, that the debits and credits to
the Net Profits Account during each Payment Period in respect of the Subject Interests Transferred
shall reflect items received or incurred by the transferee, such items to be computed in accordance with the provisions of Article III hereof. 

        5.2   Sale and Release of Properties. 

        (a)   Grantor
may from time to time Transfer the Subject Interests, or any part thereof or undivided interest therein, free of the Net Profits Interest and the Conveyance  provided that: 

	(i)
	no
Subject Interest or portion thereof may be transferred pursuant to this Section 5.2 where the production of Subject Minerals from such Subject Interest or part
thereof for the twelve (12) months immediately preceding the proposed sale date for such Subject Interest or part thereof exceeds one quarter of one percent (0.25%) of the total production of
total Subject Minerals produced from all of the Subject Interests for the twelve (12) months immediately preceding the proposed sale date for such Subject Interest or part thereof;

	(ii)
	in
connection with any such Transfer, Grantee shall receive as compensation for the release of its Net Profits Interest in the Subject Interest (or portion thereof) so
Transferred the Fair Value of the portion of the Net Profits Interest so released; and 

16

 

	(iii)
	the
aggregate fair market value of all portions of the Net Profits Interest released pursuant to Section 5.2(a) during any consecutive twelve (12) month
period shall not exceed $500,000. 

        (b)   In
connection with any Transfer pursuant to this Section 5.2, Grantor shall remit to Grantee an amount equal to the Fair Value of the portion of the Net Profits
Interest being released. Grantor shall make such payment to Grantee on the Quarterly Record Date for the Payment Period in which Grantor receives the payment with respect to any such Transfer of the
Subject Interest. 

        (c)   In
connection with any Transfer provided for in this Section 5.2, Grantee shall, on request, execute, acknowledge, and deliver to Grantor a recordable instrument
(reasonably acceptable to Grantor) that releases the Net Profits Interest with respect to the Subject Interests being Transferred. 

        (d)   From
and after the actual date of any such Transfer by Grantor, Grantor and any assignee, purchaser, transferee or grantee of such Subject Interest shall be relieved of
all obligations, requirements, and responsibilities arising under the Net Profits Interest or this Conveyance with respect to the Subject Interests Transferred, except for those that accrued prior to
such date. 

        5.3   Release of Other Properties. 

        (a)   In
the event that any Person notifies Grantor that, pursuant to a Prior Reversionary Interest, Grantor is required to convey any of the Subject Interests to such Person
or cease production from any Subject Well, Grantor may provide such conveyance with respect to such Subject Interest or permanently cease production from any such Subject Well. 

        (b)   In
the event that Grantor receives compensation pursuant to any Prior Reversionary Interest Grantee shall not be entitled to any share of such compensation. 

        (c)   In
connection with any conveyance or permanent cessation of production provided for in Section 5.3(a) above, Grantee shall, on request, execute, acknowledge, and
deliver to Grantor a recordable instrument (reasonably acceptable to Grantor) that releases the Net Profits Interest and this Conveyance with respect to any such Subject Well or Subject Interests. 

        (d)   From
and after the actual date of any conveyance or permanent cessation of production provided for in Section 5.3(a), Grantor and any assignee, purchaser,
transferee or grantee of such Subject Interest shall be relieved of all obligations, requirements, and responsibilities arising under the Net Profits Interest or this Conveyance with respect to the
Subject Interests Transferred, except for those that accrued prior to such date. 

        5.4   Farmouts. 

        (a)   Grantor
may from time to time enter into Farmout Agreements with Third Persons with respect to a Subject Interest. In the event that Grantor enters into any Farmout
Agreement with a Third Person, the Net Profits Interest and this Conveyance shall burden only Grantor's retained interest in the Subject Interest after giving effect to any interest in the Subject
Interest that a counterparty to the Farmout Agreement may earn under such Farmout Agreement. 

        (b)   In
connection with Grantor entering into any Farmout Agreement, Grantee shall, upon request, execute, acknowledge, and deliver to Grantor a recordable instrument
(reasonably acceptable to Grantor) that releases the Net Profits Interest and this Conveyance with respect to the Subject Interests being Transferred pursuant to such Farmout Agreement;  provided, the
Net Profits Interest shall continue to burden the Subject Interest retained by Grantor. 

17

  

 
 

ARTICLE VI
  OWNERSHIP OF PROPERTY; LIABLITY OF GRANTEE;
  NO RIGHT OF OPERATIONS BY GRANTEE    
    

        6.1   Ownership of Certain Property. The Net Profits Interest does not include any right, title, or interest in and to any
personal property, fixtures, or equipment and is exclusively an interest in and to the Minerals in and under and produced and saved from the Subject Interests, and Grantee shall look solely to the
Subject Minerals and payments in respect thereof (as provided herein) for the satisfaction and realization of the Net Profits Interest. 

        6.2   No Personal Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS CONVEYANCE, GRANTEE SHALL NEVER
PERSONALLY BE RESPONSIBLE FOR PAYMENT OF ANY PART OF THE COSTS, EXPENSES OR LIABILITIES INCURRED IN CONNECTION WITH THE EXPLORING, DEVELOPING, OPERATING AND MAINTAINING OF THE SUBJECT INTERESTS;  PROVIDED, HOWEVER, ALL SUCH COSTS AND EXPENSES SHALL, TO THE EXTENT THE SAME RELATE TO ACTS, OMISSIONS, EVENTS, CONDITIONS OR CIRCUMSTANCES OCCURRING
FROM AND AFTER THE EFFECTIVE DATE, NEVERTHELESS BE CHARGED AGAINST THE NET PROFITS ACCOUNT AS AND TO THE EXTENT HEREIN PERMITTED. 

        6.3   No In-Kind Rights. Grantee shall have no right to take in kind any Subject Minerals allocable to the Net
Profits Interest. 

        6.4   No Operating Rights. IT IS THE EXPRESS INTENT OF GRANTOR AND GRANTEE THAT THE NET PROFITS INTEREST SHALL CONSTITUTE (AND
THIS CONVEYANCE SHALL CONCLUSIVELY BE CONSTRUED FOR ALL PURPOSES AS CREATING) A SINGLE, SEPARATE NON-OPERATING MINERAL RIGHT WITH RESPECT TO THE SUBJECT INTERESTS FOR ALL PURPOSES AND A
FULLY VESTED AND FULLY CONVEYED INTEREST IN PROPERTY (REAL OR PERSONAL, AS APPLICABLE). WITHOUT LIMITATION OF THE GENERALITY OF THE IMMEDIATELY PRECEDING SENTENCE, GRANTOR AND GRANTEE ACKNOWLEDGE THAT
GRANTEE HAS NO RIGHT OR POWER TO PARTICIPATE IN THE SELECTION OF A DRILLING CONTRACTOR, TO PROPOSE THE DRILLING OF A WELL, TO DETERMINE THE TIMING OR SEQUENCE OF DRILLING OPERATIONS, TO COMMENCE OR
SHUT DOWN PRODUCTION, TO TAKE OVER OPERATIONS, OR TO SHARE IN ANY OPERATING DECISION WHATSOEVER. GRANTOR AND GRANTEE HEREBY EXPRESSLY NEGATE ANY INTENT TO CREATE (AND THIS CONVEYANCE SHALL NEVER BE
CONSTRUED AS CREATING) A MINING OR OTHER PARTNERSHIP OR JOINT VENTURE OR OTHER RELATIONSHIP SUBJECTING GRANTOR AND GRANTEE TO JOINT LIABILITY. 

 
 

ARTICLE VII
  WARRANTY AND NEGATIVE COVENANT    
    

        7.1   Warranty. Grantor agrees to warrant and forever defend, all and singular, the Net Profits Interest unto Grantee, its
successors and assigns, against all persons whomsoever claiming or to claim the same, or any part thereof, by, through or under Grantor, but not otherwise, subject to the Permitted Encumbrances.
Subject to the Net Profits Interest and the Permitted Encumbrances, Grantor further warrants to Grantee that with respect to claims made by, through or under Grantor, immediately following the
transfer made pursuant to his Conveyance, Grantor is (i) entitled to receive not less than the percentage set forth in Exhibit A hereto as the "Net Revenue Interest" of all Minerals
produced, saved and marketed from the Lease described on Exhibit A to which such Net Revenue Interest corresponds without reduction of such interest throughout the duration of the life of such
Lease, except as specifically set forth in Exhibit A, and (ii) obligated to bear the percentage of the 

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costs
and expenses relating to the maintenance, development and operation of such Lease not greater than the "Working Interest" shown in Exhibit A with respect to such Lease, without increase
throughout the duration of the life of such Lease, except as specifically set forth in Exhibit A. Grantor also hereby transfers to Grantee by way of substitution and subrogation (to the fullest
extent that same may be transferred), all rights or actions over and against all predecessor (other than Affiliates of Grantor) covenantors or warrantors of title. 

        7.2   Senior Obligation. Grantor agrees that it shall cause each agreement, indenture, bond, deed of trust, filing, application
or other instrument that creates or purports to create a lien, mortgage, security interest or other charge secured by the Subject Interests, Subject Minerals or the proceeds from the sale of the
Subject Minerals or the Existing Hedges that is entered into on or after the date hereof to include an express agreement and acknowledgement by the parties thereto that the Net Profits Interest is
senior in right of payment and collection to any and all obligations created thereby; provided, however, that this Section 7.2 shall not apply to (a) any agreement, indenture, bond, deed
of trust, filing, application or other instrument that creates a lien, mortgage, security interest or other charge secured by (i) not more than Grantor's residual interest in the Subject
Interests, Subject Minerals or the proceeds from the sale of the Subject Minerals (in each case after the burden of the Net Profits Interest is satisfied) or (ii) not more than Grantor's
residual interest in the Existing Hedges (after the satisfaction of Grantor's obligations under that the Assignment of Hedge Proceeds), and (b) the lien and security interest created by the
Assignment of Hedge Proceeds as in effect on the date hereof. 

 
 

ARTICLE VIII
  MISCELLANIOUS    
    

        8.1   Notices. All notices and other communications required or permitted under this Conveyance shall be in writing and, unless
otherwise specifically provided, shall be delivered personally, by electronic transmission, by registered or certified mail, postage prepaid, or by delivery service for which a receipt is obtained
(except for quarterly statements provided for under Section 3.5 above which may be sent by regular mail), at the respective addresses of Grantor and Grantee shown below, and shall be deemed
delivered on the date of receipt. Either party may specify his proper address or any other post office address within the continental limits of the United States by giving notice to the other party,
in the manner provided in this Section, at least fifteen (15) days prior to the effective date of such change of address. For purposes of notice, the addresses of Grantor and Grantee shall be
as follows: 

	If to Grantor:	 	MV Partners, LLC

c/o Murfin Drilling Company, Inc.

250 N. Water, Suite 300

Wichita, Kansas 67202
	Attention:	 	David L. Murfin
	

If to Grantee:	
 	

The Bank of New York Trust Company, N.A.

Global Corporate Trust

221 West Sixth Street, 1st Floor

Austin, Texas 78701
	Attention:	 	Mike J. Ulrich

        8.2   Payments. Grantor shall transfer or cause to be transferred all monies to which Grantee is entitled hereunder by Federal
funds wire transfer not later than the date when due, to Grantee at the bank account specified by Grantee in writing to Grantor. 

        8.3   Amendments. This Conveyance may not be amended, altered, or modified except pursuant to a written instrument executed by
Grantor and Grantee. 

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        8.4   Further Assurances. Grantor and Grantee shall from time to time do and perform such further acts and execute and deliver
such further instruments, conveyances, and documents as may be required or reasonably requested by the other party to establish, maintain, or protect the respective rights and remedies of Grantor and
Grantee and to carry out and effectuate the intentions and purposes of this Conveyance, provided in each case the same does not conflict with any
provision of this Conveyance. 

        8.5   Waivers. The failure of Grantor or Grantee to insist upon strict performance of any provision hereof shall not constitute
a waiver of or estoppel against asserting the right to require such performance in the future, nor shall a waiver or estoppel in any one instance constitute a waiver or estoppel with respect to a
later breach of a similar nature or otherwise. 

        8.6   No Partition. Grantor and Grantee acknowledge that Grantee has no right or interest that would permit Grantee to
partition any portion of the Subject Interests, and Grantee hereby waives any such right. 

        8.7   Governing Law. THIS CONVEYANCE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF KANSAS
UNLESS THE REAL PROPERTY LAWS OF THE STATE IN WHICH THE SUBJECT INTERESTS ARE LOCATED ARE MANDATORILY APPLICABLE, AND THEN ONLY TO THE EXTENT OF SUCH MANDATORY APPLICATION. 

        8.8   Rule Against Perpetuities. It is not the intent of Grantor or Grantee that any provision herein violate any applicable
law regarding the rule against perpetuities, the suspension of the absolute power of alienation, or other rules regarding the vesting or duration of estates, and this Conveyance shall be construed as
not violating any such applicable law to the extent the same can be so construed consistent with the intent of the parties. In the event, however, that any provision hereof is determined to violate
any such applicable law, then such provision shall nevertheless be effective for the maximum period (but not longer than the maximum period) permitted by any such applicable law that will result in no
violation. To the extent such maximum period is permitted to be determined by reference to "lives in being", Grantor and Grantee agree that "lives in being" shall refer to the lifetime of the last to
die of the now living lineal descendants of the late Joseph P. Kennedy (father of the late President of the United States of America). 

        8.9   Tax Matters. 

        (a)   Nothing
herein contained shall be construed to constitute a partnership or to cause either party hereto (under state law or for tax purposes) to be treated as being the
agent of, or in partnership with, the other party. In addition, the parties hereto intend that the Net Profits Interest conveyed hereby to Grantee shall at all times be treated as an incorporeal
(i.e., a non-possessory) interest in real property or land under the laws of the state in which the Subject Interests are located, a production payment under Section 636 of the
Code, and therefore, for tax purposes, debt, payable out of net profits (rather than as a working or any other interest). 

        (b)   Grantor
and Grantee agree, and by acquisition of an interest in Grantee each holder of an interest in Grantee shall be deemed to have agreed, for United States federal
income tax purposes, (1) to treat the Net Profits Interest as indebtedness that is subject to Treasury Regulations Section 1.1275-4 (the "Contingent
Debt Regulations") and, for purposes of the Contingent Debt Regulations, to treat payments received with respect to the Net Profits Interest as contingent payments, and
(2) to accrue interest with respect to the Net Profits Interest according to the "noncontingent bond method" set forth in Treasury Regulations Section 1.1275-4(b), using the
comparable yield of [    ]% per annum compounded semi-annually. 

        (c)   Grantor
and Grantee acknowledge and agree, and by acquisition of an interest in Grantee each holder of an interest in Grantee shall be deemed to have agreed, that
(i) the comparable yield and the schedule of projected payments are not determined for any purpose other than for the 

20

 

determination
of interest accruals and adjustments thereof in respect of the Net Profits Interest for United States federal income tax purposes and (ii) the comparable yield and the schedule of
projected payments do not constitute a projection or representation regarding the amounts payable on the Net Profits Interest. 

        (d)   Grantor
may cause to be withheld from any payment hereunder any tax withholding required by law or regulations, including, in the case of any withholding obligation
arising from income that does not give rise to any cash or property from which any applicable withholding tax could be satisfied, by way of set off against any subsequent payment of cash or property
hereunder. 

        8.10 Counterparts.

        (a)   Multiple
counterparts of the Conveyance have been recorded in the counties of the States of Kansas and Colorado where the Subject Interests are located. The counterparts
are identical except that, to facilitate recordation, the counterpart recorded in each county may contain property descriptions relating only to the Subject Interests located in that county. A
counterpart of the Conveyance containing all property descriptions of Subject Interests will be filed for record
in                        County, Kansas. 

        (b)   If
any Subject Interests are located in more than one county, the description of such Subject Interests may be included in any one or more counterparts prepared for
recordation in separate counties, but the inclusion of the same property description in more than one counterpart of this Conveyance shall not be construed as having effected any cumulative, multiple,
or overlapping interest in the Subject Interests in question. 

        8.11 Binding Effect. All the covenants and agreements of Grantor herein contained shall be deemed to be covenants running
with Grantor's interest in the Subject Interests and the lands affected thereby. All of the provisions hereof shall inure to the benefit of Grantee and its successors and assigns and shall be binding
upon Grantor and its successors and assigns and all other owners of the Subject Interests or any part thereof or any interest therein. 

        EXECUTED
effective for all purposes as of the Effective Time. 

	 	 	GRANTOR:
	

 	
 	
MV PARTNERS, LLC
	

 	
 	

By:	
 	

 

	

 	
 	

Name:	
 	

 

	

 	
 	

Title:	
 	

 

21

 

	

 	
 	

GRANTEE:
	

 	
 	
MV OIL TRUST
	

 	
 	

By its Trustee, The Bank of New York

Trust Company, N.A.
	

 	
 	

By:	
 	

 

	

 	
 	

Name:	
 	

 

	

 	
 	

Title:	
 	

 

	

STATE OF             	
 	

§	
 	

 
	 	 	§	 	 
	COUNTY OF             	 	§	 	 

        BE
IT REMEMBERED, THAT I, the undersigned authority, a notary public duly qualified, commissioned, sworn and acting in and for the county and state aforesaid, and being authorized in
such county and state to take acknowledgments, hereby certify that, on this            day
of                        , 2006, there personally appeared before
me                        ,
                        of MV
Partners, LLC, a Kansas limited liability company, known to me to be such officer, such limited liability company being a party to the foregoing instrument and duly acknowledged the execution of same. 

        IN
WITNESS WHEREOF, I have hereunto set my hand and official seal in the City of            ,
                        County,            , on the day and year first
above written. 

	 	 	
 Notary Public in and for

the State of             

Printed Name of Notary:             

Commission Expires:             
	STATE OF             	 	§	 	 
	 	 	§	 	 
	COUNTY OF             	 	§	 	 

        BE
IT REMEMBERED, THAT I, the undersigned authority, a notary public duly qualified, commissioned, sworn and acting in and for the county and state aforesaid, and being authorized in
such county and state to take acknowledgments, hereby certify that, on this            day
of                        , 2006, there personally appeared before
me                        ,
                        of The
Bank of New York Trust Company, N.A., as trustee of MV Oil Trust, known to me to be such officer of such trustee being a party to the foregoing instrument and duly acknowledged the execution of same. 

22

 

        IN
WITNESS WHEREOF, I have hereunto set my hand and official seal in the City of            ,
                        County,            , on the day and year first
above written. 

	 	 	
 Notary Public in and for

the State of             

Printed Name of Notary:             

Commission Expires:             

23

  

 
 

EXHIBIT A    
    
    SUBJECT INTERESTS    
    

A-1

QuickLinks

CONVEYANCE OF NET PROFITS INTEREST

ARTICLE I GRANT OF NET PROFITS INTEREST

ARTICLE II DEFINITIONS

ARTICLE III ESTABLISHMENT OF NET PROFITS ACCOUNT

ARTICLE IV OPERATION OF THE SUBJECT INTERESTS

ARTICLE V RELEASES AND TRANSFERS OF SUBJECT INTERESTS/SUBJECT WELLS

ARTICLE VI OWNERSHIP OF PROPERTY; LIABLITY OF GRANTEE; NO RIGHT OF OPERATIONS BY GRANTEE

ARTICLE VII WARRANTY AND NEGATIVE COVENANT

ARTICLE VIII MISCELLANIOUS

EXHIBIT A SUBJECT INTERESTS

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