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Unassociated Document

    EXHIBIT 10.1

    
 

    

    
      

    

    

     

    TAX
      ALLOCATION AGREEMENT

     

    by
      and between

     

    ACACIA
      RESEARCH CORPORATION

     

    and

     

    COMBIMATRIX
      CORPORATION

     

     

    
      	 
	
               

              December
                21, 2006

               

            

    

    

     

      
        

      

    

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    TABLE
      OF CONTENTS

     

    Page

     

    
      	ARTICLE I DEFINITIONS 	
               1

            
	
              Section
                1.01    General 

            	
               1

            
	
              Section
                1.02    Schedules,
                etc 

            	
               6

            
	 	 
	ARTICLE II FILING OF TAX RETURNS; PAYMENT
              OF
              TAXES; REFUNDS 	
               6

            
	
              Section
                2.01    Preparation
                of Tax Returns 

            	
               6

            
	
              Section
                2.02    Payment
                of Taxes 

            	
               8

            
	
              Section
                2.03    Tax
                Refunds and Carrybacks 

            	
               10

            
	
              Section
                2.04    Allocation
                of Straddle Period Taxes 

            	
               11

            
	 	 
	ARTICLE III TAX INDEMNIFICATION; TAX
              CONTESTS 	
               12

            
	
              Section
                3.01    Indemnification 

            	
               12

            
	
              Section
                3.02    CombiMatrix
                Tax Acts 

            	
               13

            
	
              Section
                3.03    Notice
                of Indemnity 

            	
               14

            
	
              Section
                3.04    Payments 

            	
               14

            
	
              Section
                3.05    Tax
                Contests 

            	
               16

            
	 	 
	
              ARTICLE IV OPTIONS; COMPENSATION PAYMENTS; INTEREST
                CHARGE FOR LATE PAYMENTS; CURRENCY CALCULATIONS; 

              EFFECTIVE
                TIME OF TRANSACTIONS 

            	
               16

            
	
              Section
                4.01    Stock
                Options; Restricted Shares 

            	
               16

            
	
              Section
                4.02    Compensation
                Payments

            	
               18

            
	
              Section
                4.03    Change
                in Law

            	
               18

            
	
              Section
                4.04    Interest
                Charge for Late Payments

            	
               18

            
	
              Section
                4.05    Currency
                Calculations

            	
               19

            
	
              Section
                4.06    Effective
                Time of Transaction

            	
               19

            
	 	 
	ARTICLE V COOPERATION AND EXCHANGE OF
              INFORMATION 	
               19

            
	
              Section
                5.01    Inconsistent
                Actions

            	
               19

            
	
              Section
                5.02    Cooperation
                and Exchange of Information

            	
               19

            
	
              Section
                5.03    Tax
                Records

            	
               20

            
	 	 
	ARTICLE VI MISCELLANEOUS 	
               20

            
	
              Section
                6.01    Entire
                Agreement; Construction

            	
               20

            
	
              Section
                6.02    Effectiveness

            	
               21

            
	
              Section
                6.03    Survival
                of Agreements

            	
               21

            
	
              Section
                6.04    Governing
                Law

            	
               21

            
	
              Section
                6.05    Notices

            	
               21

            
	
              Section
                6.06    Amendments

            	
               21

            
	
              Section
                6.07    Successors
                and Assigns

            	
               21

            
	
              Section
                6.08    Captions;
                Currency

            	
               21

            
	
              Section
                6.09    Severability

            	
               21

            
	
              Section
                6.10    Parties
                in Interest

            	
               22

            

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      	
              Section
                6.11    Schedules

            	
               22

            
	
              Section
                6.12    Termination

            	
               22

            
	
              Section
                6.13    Waivers;
                Remedies

            	
               22

            
	
              Section
                6.14    Counterparts

            	
               22

            
	
              Section
                6.15    Performance

            	
               22

            
	
              Section
                6.16    Interpretation

            	
               22

            
	
              Section
                6.17    Dispute
                Resolution

            	
               23

            

    

     

    
      	
              SCHEDULE
                1.01

               

            	
              COMBIMATRIX
                TAX GROUP MEMBERS

               

            
	
              SCHEDULE
                2.01(f)

               

            	
              TAX
                RETURNS TO BE FILED BY NON-RESPONSIBLE PARTY

               

            
	
              SCHEDULE
                3.02(a)

               

            	
              COMBIMATRIX
                TAX ACT

               

            
	
              SCHEDULE
                3.02(b)

               

            	
              COMBIMATRIX
                TAX REPRESENTATION LETTER

               

            
	
              SCHEDULE
                3.02(c)

            	
              PRE-DISTRIBUTION
                TAX-FREE TRANSACTIONS

            

    

    

    

    

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

       

    

    TAX
      ALLOCATION AGREEMENT

     

    THIS
      TAX
      ALLOCATION AGREEMENT (this “Agreement”)
      is
      made and entered into as of December 21, 2006, by and between ACACIA RESEARCH
      CORPORATION, a Delaware corporation (“Acacia”),
      and
      COMBIMATRIX CORPORATION, a Delaware corporation and, as of the date hereof,
      a
      wholly-owned subsidiary of Acacia (“CombiMatrix”).

     

    RECITALS

     

    A.  The
      Acacia Board (as defined herein) has determined that it is appropriate and
      desirable, subject to the terms and conditions contained in the Distribution
      Agreement by and between Acacia and CombiMatrix dated as of the date hereof
      (“Distribution
      Agreement”)
      for
      Acacia to distribute on a pro rata basis to holders of shares of CBMX Tracking
      Stock (as defined herein) the outstanding shares of CombiMatrix Common Stock
      (as
      defined herein) owned by Acacia.

     

    B.  Acacia
      and CombiMatrix wish to provide for and agree upon the allocation between the
      Acacia Tax Group (as defined herein) and the CombiMatrix Tax Group (as defined
      herein) of all responsibilities, liabilities and benefits relating to or
      affecting Taxes (as defined herein) paid or payable by either of them for all
      taxable periods, whether beginning before, on or after the Distribution Date
      (as
      defined herein).

     

    AGREEMENT

     

    NOW,
      THEREFORE, in consideration of the premises and of the respective agreements
      contained in this Agreement, the parties hereto hereby agree as
      follows:

     

    ARTICLE
      I

     

    DEFINITIONS

     

    Section
      1.01  General.
      As used
      in this Agreement, the following terms shall have the following meanings (such
      meanings to be equally applicable to both the singular and plural forms of
      the
      terms defined). Any capitalized term not otherwise defined in this Agreement
      shall have the meaning ascribed to it in the Distribution
      Agreement.

     

    “Acacia”
shall
      have the meaning ascribed thereto in the preamble.

     

    “Acacia
      Board”
shall
      mean the Board of Directors of Acacia or a duly authorized committee
      thereof.

     

    “Acacia
      Business”
shall
      have the meaning ascribed thereto that term in the Distribution
      Agreement.

     

    “Acacia/CombiMatrix
      Tax Group”
shall
      mean any corporation or other legal entity which is a member of the Acacia
      Tax
      Group or the CombiMatrix Tax Group but only with respect to taxable periods
      (or
      portions thereof) ending on or before or including the Distribution
      Date.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Acacia
      Group Employees and Former Employees”
shall
      mean individuals (i) who are employees of any member of the Acacia Tax
      Group on the date of the event giving rise to a deduction in respect of any
      Compensation Payments made to such individuals or Stock Options or Restricted
      Stock held by such individuals, or (ii) whose most recent employment with any
      member of the Acacia Tax Group or the CombiMatrix Tax Group prior to such date
      was more closely associated with the Acacia Business or some other business
      rather than the CombiMatrix Business.

     

    “Acacia
      Restricted Stock”
shall
      mean shares of CBMX Tracking Stock subject to restrictions on transferability
      and subject to a substantial risk of forfeiture.

     

    “Acacia
      Tax Group”
shall
      mean (i) Acacia, (ii) any corporation or other legal entity which Acacia
      directly or indirectly owns immediately following the Distribution Date other
      than a member of the CombiMatrix Tax Group, and (iii) any other corporation
      or
      other legal entity which Acacia directly or indirectly owned at any time prior
      to the Distribution Date (but only with respect to the period such corporation
      or other entity was so owned by Acacia) other than a member of the CombiMatrix
      Tax Group.

     

    “Actually
      Realized”
shall
      mean, for purposes of determining the timing of any Taxes (or related Tax cost
      or benefit) relating to any payment, transaction, occurrence or event, the
      time
      at which the amount of Taxes (including estimated Taxes) payable by any person
      is increased above or reduced below, as the case may be, the amount of Taxes
      that such person would be required to pay but for the payment, transaction,
      occurrence or event.

     

    “CBMX
      Tracking Stock”
shall
      mean the Acacia Research-CombiMatrix Common, par value of $0.001 per share,
      of
      Acacia.

     

    “CBMX
      Stock Options”
shall
      mean options to acquire CBMX Tracking Stock.

     

    “Code”
shall
      mean the Internal Revenue Code of 1986, as amended, or any successor
      legislation.

     

    “CombiMatrix”
shall
      have the meaning ascribed thereto in the preamble.

     

    “CombiMatrix
      Business”
shall
      have the meaning ascribed thereto that term in the Distribution
      Agreement.

     

    “CombiMatrix
      Common Stock”
shall
      mean the Common Stock, par value $0.001 per share, of CombiMatrix.

     

    “CombiMatrix
      Common Stock Options”
shall
      mean options to acquire CombiMatrix Common Stock.

     

    “CombiMatrix
      Group Employees and Former Employees”
shall
      mean individuals (i) who are employees of any member of the CombiMatrix Tax
      Group on the date of the event giving rise to a deduction in respect of any
      Compensation Payments made to such individuals or Stock Options held by such
      individuals or (ii) whose most recent employment with any member of the Acacia
      Tax Group or the CombiMatrix Tax Group prior to such date was more closely
      associated with the CombiMatrix Business or some other business rather than
      the
      Acacia Business.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    “CombiMatrix
      Tax Act”
shall
      have the meaning set forth in Section 3.02(a).

     

    “CombiMatrix
      Tax Group”
shall
      mean (i) CombiMatrix and (ii) any corporation or other legal entity set forth
      on
      Schedule 1.01.

     

    “CombiMatrix
      Tax Representation Letter”
shall
      mean the letter delivered by CombiMatrix to Acacia on the Distribution Date,
      substantially in the form set forth in Schedule 3.02(b).

     

    “Compensation
      Payments”
shall
      mean all non-qualified employee benefit plan and welfare benefit plan payments
      made under the Employee Matters Agreement dated the date hereof by and between
      Acacia and CombiMatrix.

     

    “Distribution”
shall
      mean the distribution of the CombiMatrix Common Stock on a pro rata basis to
      holders of CBMX Tracking Stock on the Distribution Date pursuant to the
      Distribution Agreement.

     

    “Distribution
      Agreement”
shall
      have the meaning ascribed thereto in Recital A of this Agreement.

     

    “Distribution
      Transaction”
shall
      mean any transaction undertaken in connection with the
      Distribution.

     

    “Distribution
      Date”
shall
      mean the date on which the Distribution occurs (or, if different, the date
      on
      which the Distribution is deemed to occur for U.S. federal Income Tax purposes).
      For purposes of this Agreement, the Distribution shall be deemed effective
      as of
      5:00 p.m. (Pacific Standard Time) on the Distribution Date.

     

    “Foreign
      Income Tax”
shall
      mean any Income Tax other than a U.S. federal, state or local Income
      Tax.

     

    “Foreign
      Income Tax Returns”
shall
      mean any Income Tax Return which is not a U.S. federal, state or local Income
      Tax Return.

     

    “Income
      Tax”
shall
      mean (a) any Tax based upon, measured by, or calculated with respect to (i)
      net
      income or profits (including, but not limited to, any capital gains, minimum
      Tax
      and any Tax on items of Tax preference, but not including sales, use, real
      or
      personal property, gross or net receipts, transfer or similar Taxes) or (ii)
      multiple bases (including, but not limited to, corporate franchise, doing
      business or occupation Taxes) if one or more of the bases upon which such Tax
      may be based, measured by, or calculated with respect to, is described in clause
      (i) above, or (b) any U.S. state or local franchise Tax; including in the case
      of each of (a) and (b) any related interest and any penalties, additions to
      such
      Tax or additional amounts imposed with respect thereto by any Tax
      Authority.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    “Income
      Tax Benefit”
shall
      mean for any taxable period the excess of (i) the hypothetical Income Tax
      liability of the taxpayer for the taxable period calculated as if the Timing
      Difference or Reverse Timing Difference, as the case may be, had not occurred
      but with all other facts unchanged, over (ii) the actual Income Tax liability
      of
      the taxpayer for the taxable period, calculated taking into account the Timing
      Difference or Reverse Timing Difference, as the case may be (treating an Income
      Tax refund or credit as a negative Income Tax liability for purposes of such
      calculation).

     

    “Income
      Tax Detriment”
shall
      mean for any taxable period the excess of (i) the actual Income Tax liability
      of
      the taxpayer for the taxable period, calculated taking into account the Timing
      Difference or Reverse Timing Difference, as the case may be, over (ii) the
      hypothetical Income Tax liability of the taxpayer for the taxable period,
      calculated as if the Timing Difference or Reverse Timing Difference, as the
      case
      may be, had not occurred but with all other facts unchanged (treating an Income
      Tax refund or credit as a negative Income Tax liability for purposes of such
      calculation).

     

    “Income
      Tax Return”
shall
      mean any Tax Return that relates to Income Taxes.

     

    “Indemnitee”
shall
      have the meaning set forth in Section 3.03.

     

    “Indemnitor”
shall
      have the meaning set forth in Section 3.03.

     

    “Indemnity
      Issue”
shall
      have the meaning set forth in Section 3.03.

     

    “IRS”
shall
      mean the Internal Revenue Service.

     

    “Non-Income
      Tax”
shall
      mean any Tax other than an Income Tax.

     

    “Person”
shall
      mean any individual, partnership, joint venture, corporation, limited liability
      entity, trust, unincorporated organization or other entity (including a
      governmental entity).

     

    “Post-Distribution
      Taxable Period”
shall
      mean a taxable period beginning after the Distribution Date.

     

    “Post-Distribution
      Tax Act”
shall
      have the meaning set forth in Section 3.01(a).

     

    “Post-Tax
      Indemnification Period”
shall
      mean any Post-Distribution Taxable Period and that portion of any Straddle
      Period that begins on the day after the Distribution Date.

     

    “Pre-Distribution
      Taxable Period”
shall
      mean a taxable period ending on or before the Distribution Date.

     

    “Restricted
      Stock”
shall
      mean CBMX Restricted Stock or CombiMatrix Restricted Stock.

     

    “Reverse
      Timing Difference”
shall
      mean an increase in income, gain or recapture, or a decrease in deduction,
      loss
      or credit, as calculated for Income Tax purposes, of the taxpayer for the Tax
      Indemnification Period coupled with an increase in deduction, loss or credit,
      or
      a decrease in income, gain or recapture, of the taxpayer for any Post-Tax
      Indemnification Period.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    “Rights”
shall
      have the meaning ascribed thereto in the Distribution Agreement.

     

    “Separation
      Agreements”
shall
      have the meaning ascribed thereto in the Distribution Agreement.

     

    “Stock
      Options”
shall
      mean CombiMatrix Common Stock Options or CBMX Tracking Stock
      Options.

     

    “Straddle
      Period”
shall
      mean a taxable period that includes but does not end on the Distribution
      Date.

     

    “Tax”
and
      “Taxes”
shall
      mean all forms of taxation, whenever created or imposed, and whether of the
      United States or elsewhere, and whether imposed by a federal, state, municipal,
      governmental, territorial, local, foreign or other body, and without limiting
      the generality of the foregoing, shall include net income, gross income, gross
      receipts, sales, use, value added, ad valorem, transfer, recording, franchise,
      profits, license, lease, service, service use, payroll, wage, withholding,
      employment, unemployment insurance, workers compensation, social security,
      excise, severance, stamp, business license, business organization, occupation,
      premium, property, environmental, windfall profits, customs, duties, alternative
      minimum, estimated or other taxes, fees, premiums, assessments or charges of
      any
      kind whatever imposed or collected by any governmental entity or political
      subdivision thereof, together with any related interest and any penalties,
      additions to such tax or additional amounts imposed with respect thereto by
      any
      Tax Authority.

     

    “Tax
      Authority”
shall
      mean, with respect to any Tax, any governmental entity, quasi-governmental
      body
      or political subdivision thereof that imposes such Tax and the agency (if any)
      charged with the determination or collection of such Tax for such entity, body
      or subdivision.

     

    “Tax
      Group”
shall
      mean the Acacia Tax Group or the CombiMatrix Tax Group, as the case may
      be.

     

    “Tax
      Indemnification Period”
shall
      mean any Pre-Distribution Taxable Period and that portion of any Straddle Period
      that ends on the Distribution Date.

     

    “Tax
      Return”
shall
      mean any return, filing, questionnaire, information return, election or other
      document required or permitted to be filed, including requests for extensions
      of
      time, filings made with respect to estimated tax payments, claims for refund
      and
      amended returns that may be filed, for any period with any Tax Authority
      (whether domestic or foreign) in connection with any Tax (whether or not a
      payment is required to be made with respect to such filing).

     

    “Timing
      Difference”
means
      an increase in income, gain or recapture, or a decrease in deduction, loss
      or
      credit, as calculated for Income Tax purposes, of the taxpayer for any Post-Tax
      Indemnification Period coupled with an increase in deduction, loss or credit,
      or
      a decrease in income, gain or recapture, of the taxpayer for the Tax
      Indemnification Period.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    Section
      1.02  Schedules,
      etc.
      References to a “Schedule”
are,
      unless otherwise specified, to a Schedule attached to this Agreement; references
      to “Section”
or
      “Article”
are,
      unless otherwise specified, to one of the Sections or Articles of this
      Agreement; references to “sub-section”
are,
      unless the context otherwise requires, references to the section in which the
      reference appears; and references to this Agreement include the
      Schedules.

     

    ARTICLE
      II

     

    FILING
      OF TAX RETURNS; PAYMENT OF TAXES; REFUNDS

     

    Section
      2.01  Preparation
      of Tax Returns.

     

    (a)  United
      States Federal Income Tax Returns.

     

    (i)  Acacia
      shall prepare and file or cause to be prepared and filed all U.S. federal Income
      Tax Returns (including amendments thereto) which are required to be filed in
      respect of (A) a member of the Acacia/CombiMatrix Tax Group for any
      Pre-Distribution Taxable Period or Straddle Period or (B) a member of the Acacia
      Tax Group for any Post-Distribution Taxable Period. CombiMatrix hereby
      irrevocably designates, and agrees to cause each of its affiliates to so
      designate, Acacia as its agent to take any and all actions necessary or
      incidental to the preparation and filing of such U.S. federal Income Tax Returns
      of Acacia’s affiliated group.

     

    (ii)  All
      U.S.
      federal Income Tax Returns (including amendments thereto) required to be filed
      in respect of a member of the CombiMatrix Tax Group which are not the
      responsibility of the Acacia Tax Group are the responsibility of the CombiMatrix
      Tax Group.

     

    (b)  United
      States State and Local Income Tax Returns.

     

    (i)  Acacia
      shall prepare and file or cause to be prepared and filed all U.S. state and
      local Income Tax Returns (including amendments thereto) which are required
      to be
      filed in respect of (A) a member of the Acacia/CombiMatrix Tax Group for any
      Pre-Distribution Taxable Period or Straddle Period including consolidated,
      combined and unitary Tax Returns including a member of the CombiMatrix Tax
      Group, (B) any member of the CombiMatrix Tax Group for any Pre-Distribution
      Period or Straddle Period in which it conducts or has conducted both an Acacia
      business and a CombiMatrix business or (C) a member of the Acacia Tax Group
      for
      any Post-Distribution Taxable Period. CombiMatrix hereby irrevocably designates,
      and agrees to cause each of its affiliates to so designate, Acacia as its agent
      to take any and all actions necessary or incidental to the preparation and
      filing of such U.S. state and local Income Tax Returns of members of the Acacia
      Tax Group.

     

    (ii)  All
      U.S.
      state and local Income Tax Returns (including amendments thereto) required
      to be
      filed in respect of a member of the CombiMatrix Tax Group which are not the
      responsibility of the Acacia Tax Group shall be the responsibility of the
      CombiMatrix Tax Group.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    (c)  Foreign
      Income Tax Returns.

     

    (i)  Acacia
      shall prepare and file or cause to be prepared and filed all Foreign Income
      Tax
      Returns (including amendments thereto) which are required to be filed in respect
      of (A) a member of the Acacia Tax Group for any Pre-Distribution Taxable Period
      or Straddle Period, (B) a member of the CombiMatrix Tax Group for any
      Pre-Distribution Period or Straddle Period in which it conducts, or has
      conducted, both an Acacia business and a CombiMatrix business, or (C) a member
      of the Acacia Tax Group for any Post-Distribution Taxable Period. CombiMatrix
      hereby irrevocably designates, and agrees to cause each of its affiliates to
      so
      designate, Acacia as its agent to take any and all actions necessary or
      incidental to the preparation and filing of such Foreign Income Tax Returns
      of
      members of the Acacia Tax Group.

     

    (ii)  All
      Foreign Income Tax Returns (including amendments thereto) required to be filed
      in respect of a member of the CombiMatrix Tax Group which are not the
      responsibility of the Acacia Tax Group shall be the responsibility of the
      CombiMatrix Tax Group.

     

    (d)  Non-Income
      Tax Returns.

     

    (i)  Acacia
      shall prepare and file or cause to be prepared and filed all Tax Returns
      (including amendments thereto) which are Non-Income Tax Returns which are
      required to be filed in respect of (A) a member of the Acacia Tax Group for
      any
      Pre-Distribution Taxable Period or Straddle Period), (B) any member of the
      CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in
      which it conducts or has conducted both an Acacia business and a CombiMatrix
      business or (C) a member of the Acacia Tax Group for any Post-Distribution
      Taxable Period. CombiMatrix hereby irrevocably designates, and agrees to cause
      each of its affiliates to so designate, Acacia as its agent to take any and
      all
      actions necessary or incidental to the preparation and filing of such non-U.S.
      federal Income Tax Returns.

     

    (ii)  All
      Non-Income Tax Returns (including amendments thereto) required to be filed
      in
      respect of a member of the CombiMatrix Tax Group which are not the
      responsibility of the Acacia Tax Group shall be the responsibility of the
      CombiMatrix Tax Group.

     

    (e)  Consistent
      with Past Practice; Review by Non-Responsible Party.
      Unless
      Acacia and CombiMatrix otherwise agree in writing, all Tax Returns (including
      amendments thereto) described in this Section 2.01 filed after the date of
      this
      Agreement for Pre-Distribution Taxable Periods or Straddle Periods, in the
      absence of a controlling change in law or circumstances, shall be prepared
      on a
      basis consistent with the elections, accounting methods, conventions and
      principles of taxation used for the most recent taxable periods for which Tax
      Returns involving similar matters have been filed. Upon the request of the
      non-responsible party, the party responsible under this Section 2.01 for
      preparation of a particular Tax Return for Pre-Distribution Taxable Periods
      or
      Straddle Periods shall make available a draft of such Tax Return (or relevant
      portions thereof) for review and comment by such non-responsible party. Subject
      to the provisions of this Agreement, all decisions relating to the preparation
      of Tax Returns shall be made in the sole discretion of the party responsible
      under this Agreement for such preparation.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    (f)  Responsibility
      for Filing.
      Although, pursuant to this Agreement, Acacia or CombiMatrix may be responsible
      for filing a particular Tax Return, Acacia and CombiMatrix have agreed that
      the
      actual preparation and filing of certain Tax Returns will be done by the
      non-responsible party. Schedule 2.01(f) attached hereto sets forth a schedule
      specifying such Tax Returns. Acacia and CombiMatrix may agree from time to
      time
      to additions to or deletions from Schedule 2.01(f).

     

    Section
      2.02  Payment
      of Taxes.

     

    (a)  United
      States Federal Income Taxes.
      Except
      as otherwise provided in this Agreement:

     

    (i)  Acacia
      shall pay or cause to be paid, on a timely basis, all Taxes due with respect
      to
      the consolidated U.S. federal Income Tax liability for (A) all members of the
      Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period,
      including consolidated Tax Returns also including a member of the CombiMatrix
      Tax Group, and (B) any member of the Acacia Tax Group for any Post-Distribution
      Taxable Period, provided,
      however,
      that
      CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees
      to
      pay directly to or at the direction of Acacia, at least five days prior to
      the
      date payment (including estimated payment) thereof is due, the share of such
      U.S. federal Income Tax liability of any member of the CombiMatrix Tax Group
      attributable to the CombiMatrix business, assets or activities allocated between
      the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group, on the
      other hand, determined in a manner analogous to that set forth in Treasury
      Regulation Section 1.1552-1(a)(2).

     

    (ii)  CombiMatrix
      shall pay or cause to be paid, on a timely basis, all U.S. federal Income Taxes
      of the CombiMatrix Tax Group which are not the responsibility of the Acacia
      Tax
      Group.

     

    (b)  United
      States State and Local Income Taxes.
      Except
      as otherwise provided in this Agreement:

     

    (i)  Acacia
      shall pay or cause to be paid, on a timely basis, all Taxes due with respect
      to
      the state and local Income Tax liability for (A) all members of the Acacia
      Tax
      Group for any Pre-Distribution Taxable Period or Straddle Period, including
      consolidated, combined and unitary Tax Returns also including a member of the
      CombiMatrix Tax Group, (B) any member of the CombiMatrix Tax Group for any
      Pre-Distribution Period or Straddle Period in which it conducts or has conducted
      both an Acacia business and a CombiMatrix business, and (C) any member of
      the Acacia Tax Group for any Post-Distribution Taxable Period, provided,
      however,
      that
      CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees
      to
      pay directly to or at the direction of Acacia, at least five days prior to
      the
      date payment (including estimated payment) thereof is due, the share of such
      U.S. state and local Income Tax liability of any member of the CombiMatrix
      Tax
      Group attributable to the CombiMatrix business, assets or activities allocated
      between the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group,
      on
      the other hand, determined in a manner analogous to that set forth in Treasury
      Regulation Section 1.1552-1(a)(2).

     

    
      
        
        

      

      
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    (ii)  CombiMatrix
      shall pay or cause to be paid, on a timely basis, all U.S. state and local
      Income Taxes of the CombiMatrix Tax Group which are not the responsibility
      of
      the Acacia Tax Group.

     

    (c)  Foreign
      Income Taxes.
      Except
      as otherwise provided in this Agreement:

     

    (i)  Acacia
      shall pay or cause to be paid, on a timely basis, all Taxes due with respect
      to
      the Foreign Income Tax liability for (A) all members of the Acacia Tax Group
      for
      any Pre-Distribution Taxable Period or Straddle Period, (B) any member of the
      CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in
      which it conducts, or has conducted, both an Acacia business and a CombiMatrix
      business, or (C) any member of the Acacia Tax Group for any Post-Distribution
      Taxable Period, provided,
      however,
      that
      CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees
      to
      pay directly to or at the direction of Acacia, at least five days prior to
      the
      date payment (including estimated payment) thereof is due, the share of such
      Foreign Income Tax liability of any member of the CombiMatrix Tax Group
      attributable to the CombiMatrix business, assets or activities allocated between
      the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group, on the
      other hand, determined in a manner analogous to that set forth in Treasury
      Regulation Section 1.1552-1(a)(2).

     

    (ii)  CombiMatrix
      shall pay or cause to be paid, on a timely basis, all Foreign Income Taxes
      which
      are not the responsibility of the Acacia Tax Group.

     

    (d)  Non-Income
      Taxes.
      Except
      as otherwise provided in this Agreement:

     

    (i)  Acacia
      shall pay or cause to be paid, on a timely basis, all Taxes which are Non-Income
      Taxes due with respect to the Tax liability for (A) all members of the Acacia
      Tax Group for any Pre-Distribution Taxable Period, Straddle Period or
      Post-Distribution Taxable Period, (B) any member of the CombiMatrix Tax Group
      for any Pre-Distribution Period or Straddle Period in which it conducts or
      has
      conducted both an Acacia business and a CombiMatrix business and (C) a member
      of
      the Acacia Tax Group for any Post-Distribution Taxable Period, provided,
      however,
      that
      CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees
      to
      pay directly to or at the direction of Acacia, at least five days prior to
      the
      date payment (including estimated payment) thereof is due, the share of such
      Non-Income Tax liability of any member of the CombiMatrix Tax Group,
      attributable to the CombiMatrix business, assets or activities.

     

    (ii)  CombiMatrix
      shall pay or cause to be paid, on a timely basis, all Taxes which are Non-Income
      Taxes which are not the responsibility of the Acacia Tax Group.

     

    (e)  Employment
      Taxes.
      CombiMatrix shall pay or cause to be paid, on a timely basis, all employment
      Taxes for all Pre-Distribution Taxable Periods, Straddle Periods and
      Post-Distribution Taxable Periods attributable to (I) any employee of the
      CombiMatrix Tax Group on the day following the Distribution Date or (II) any
      individual who was neither an employee of the CombiMatrix Tax Group or the
      Acacia Tax Group on the day following the Distribution Date but whose most
      recent employment prior to the Distribution Date with any member of the
      CombiMatrix Tax Group or the Acacia Tax Group was more closely associated with
      the CombiMatrix Business rather than the Acacia Business.

     

    
      
        
        

      

      
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    (f)  Post-Distribution
      Date Taxes.
      Except
      as otherwise provided in this Agreement, all Taxes for all Post-Distribution
      Taxable Periods shall be paid or caused to be paid by the party responsible
      under this Agreement for filing the Tax Returns pursuant to which such Taxes
      are
      due or, if no such Tax Returns are due, by the party liable for such
      Taxes.

     

    (g)  Credit
      for Prior Tax Payments.
      To the
      extent any member of a Tax Group has made a payment of Taxes (including
      estimated Taxes) on or before the Distribution Date, the party liable for paying
      such Taxes under this Agreement shall be entitled to treat the payment as having
      been paid or caused to have been paid by such party, and such party shall not
      be
      required to reimburse the party which actually paid such Taxes.

     

    (h)  Responsibility
      for Payment; Notice of Payment Due.
      Although Acacia or CombiMatrix may be responsible for paying a particular Tax
      liability, Acacia and CombiMatrix may agree that the actual payment to a Taxing
      Authority of certain Tax liabilities will be made by the non-responsible party.
      Acacia and CombiMatrix may agree to prepare a schedule setting forth such Tax
      liabilities and may agree from time to time to additions to or deletions from
      such schedule. In each case where Acacia or CombiMatrix, as the case may be,
      is
      required to make payment of Taxes to the other party, Acacia or CombiMatrix,
      as
      the case may be shall notify the other party as to the amount of Taxes due
      from
      the other party at least five days prior to the date payment (including
      estimated payment) is due.

     

    Section
      2.03  Tax
      Refunds and Carrybacks.

     

    (a)  Retention
      and Payment of Tax Refunds.
      Except
      as otherwise provided in this Agreement, Acacia shall be entitled to retain,
      and
      to receive within ten days after Actually Realized by the CombiMatrix Tax Group,
      the portion of all refunds or credits of Taxes for which the Acacia Tax Group
      is
      liable pursuant to Section 2.02 or Section 3.01(a) or is treated as having
      paid
      or caused to have been paid pursuant to Section 2.02(d), and CombiMatrix shall
      be entitled to retain, and to receive within ten days after Actually Realized
      by
      the Acacia Tax Group, the portion of all refunds or credits of Taxes for which
      the CombiMatrix Tax Group is liable pursuant to Section 2.02 or Section 3.01(b)
      or is treated as having paid or caused to have been paid pursuant to Section
      2.02(d). The amount of any refund or credit of Taxes to which Acacia or
      CombiMatrix is entitled to retain or receive pursuant to the foregoing sentence
      shall be reduced to take account of any Taxes incurred by the CombiMatrix Tax
      Group, in the case of a refund or credit to which Acacia is entitled, or the
      Acacia Tax Group, in the case of a refund or credit to which CombiMatrix is
      entitled, upon the receipt of such refund or credit.

     

    (b)  Carrybacks;
      Carryforwards.
      Unless
      the parties otherwise agree in writing, CombiMatrix shall elect and shall cause
      each member of the CombiMatrix Tax Group to elect, where permitted by law,
      to
      carry forward any net operating loss, net capital loss, charitable contribution
      or other item arising after the Distribution Date that could, in the absence
      of
      such election, be carried back to a Pre-Distribution Taxable Period. Except
      as
      otherwise provided in this Agreement, notwithstanding the provisions of Section
      2.03(a), (i) any refund or credit of Taxes resulting from the carryback of
      any
      item of Taxes attributable to the CombiMatrix Tax Group arising in a Post-Tax
      Indemnification Period to a Tax Indemnification Period shall be for the account
      and benefit of the CombiMatrix Tax Group, (ii) any refund or credit of Taxes
      resulting from the carryback of any item of Taxes attributable to the Acacia
      Tax
      Group arising in a Post-Tax Indemnification Period to a Tax Indemnification
      Period shall be for the account and benefit of the Acacia Tax Group, and (iii)
      any refund or credit of Taxes resulting from a carryback of any item of federal
      Income Taxes attributable to the Acacia/CombiMatrix Tax Group (including
      derivative state and local refunds or credits) shall be for the account and
      benefit of the party to this Agreement that generated such benefit, which shall
      be determined on a case-by-case basis by a nationally recognized accounting
      firm
      selected by Acacia and reasonably satisfactory to CombiMatrix.

     

    
      
        
        

      

      
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    (c)  Refund
      Claims.
      Acacia
      shall be permitted to file at Acacia’s sole expense, and CombiMatrix shall
      reasonably cooperate with Acacia in connection with, any claims for refund
      of
      Taxes to which Acacia is entitled pursuant to this Section 2.03 or any other
      provision of this Agreement. Acacia shall reimburse CombiMatrix for any
      reasonable out-of-pocket costs and expenses incurred by any member of the
      CombiMatrix Tax Group in connection with such cooperation. CombiMatrix shall
      be
      permitted to file at CombiMatrix’s sole expense, and Acacia shall reasonably
      cooperate with CombiMatrix in connection with, any claims for refunds of Taxes
      to which CombiMatrix is entitled pursuant to this Section 2.03 or any other
      provision of this Agreement. CombiMatrix shall reimburse Acacia for any
      reasonable out-of-pocket costs and expenses incurred by any member of the Acacia
      Tax Group in connection with such cooperation.

     

    Section
      2.04  Allocation
      of Straddle Period Taxes.
      In the
      case of any Straddle Period:

     

    (a)  Periodic
      Taxes.
      (i) The
      periodic Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group
      or its business, assets or activities that are not based on income or receipts
      (e.g.,
      property Taxes) for the portion of any Straddle Period ending on the
      Distribution Date shall be computed based on the ratio of the number of days
      in
      such portion of the Straddle Period and the number of days in the entire taxable
      period; and (ii) the periodic taxes of a member of the Acacia Tax Group or
      the
      CombiMatrix Tax Group or its business, assets or activities that are not based
      on income or receipts for the portion of any Straddle Period beginning on the
      day after the Distribution Date shall be computed based on the ratio of the
      number of days in such portion of the Straddle Period and the number of days
      in
      the entire taxable period.

     

    (b)  Non-Periodic
      Taxes.
      (i) The
      Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its
      business, assets or activities for that portion of any Straddle Period ending
      on
      the Distribution Date (other than Taxes described in Section 2.04(a) above),
      shall be computed on a “closing-of-the-books” basis as if such taxable period
      ended as of the close of business on the Distribution Date, and, in the case
      of
      any Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group
      or
      its business, assets or activities with respect to any equity interest in any
      partnership or other “flowthrough” entity, as if the taxable period of such
      partnership or other “flowthrough” entity ended on the Distribution Date; and
      (ii) the Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group
      or its business, assets or activities for that portion of any Straddle Period
      beginning after the Distribution Date (other than Taxes described in Section
      2.04(a) above), shall be computed on a “closing-of-the-books” basis as if such
      taxable period began on the day after the Distribution Date, and, in the case
      of
      any Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group
      or
      its business, assets or activities with respect to any equity interest in any
      partnership or other “flowthrough” entity, as if the taxable period of such
      partnership or other “flowthrough” entity began as of the day after the
      Distribution Date.

     

    
      
        
        

      

      
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    (c)  The
      Taxes
      of the Acacia Tax Group and the CombiMatrix Tax Group with respect to any Tax
      Return for a Straddle Period which includes a member of each of the Acacia
      Tax
      Group and the CombiMatrix Tax Group or their respective businesses, assets
      or
      activities shall be allocated between the Acacia Tax Group, on the one hand,
      and
      the CombiMatrix Tax Group, on the other hand, determined in a manner analogous
      to that set forth in Treasury Regulation Section 1.1552-1(a)(2).

     

    ARTICLE
      III

     

    TAX
      INDEMNIFICATION; TAX CONTESTS

     

    Section
      3.01  Indemnification.

     

    (a)  Acacia
      Indemnification.
      Subject
      to Section 3.01(b) and Section 3.02, Acacia shall indemnify, defend and hold
      harmless each member of the CombiMatrix Tax Group and each of their respective
      shareowners, directors, officers, employees and agents and each of the heirs,
      executors, successors and assigns of any of the foregoing from and
      against:

     

    (i)  all
      Taxes
      of the Acacia Tax Group other than any Taxes for which CombiMatrix is liable
      pursuant to Section 2.02(e);

     

    (ii)  all
      Taxes
      of the CombiMatrix Tax Group for all Pre-Distribution Taxable Periods and all
      Straddle Periods for which Acacia is liable pursuant to Section 2.02 or
      3.02;

     

    (iii)  all
      liability as a result of Treasury Regulation Section 1.1502-6(a) (which imposes
      several liability on members of an affiliated group that file a U.S. federal
      consolidated Income Tax return) or comparable U.S. state or local provision
      for
      Income Taxes of any person which is or has ever been affiliated with any member
      of the Acacia/CombiMatrix Tax Group or with which any member of the
      Acacia/CombiMatrix Tax Group joins or has ever joined (or is or has ever been
      required to join) in filing any consolidated, combined or unitary Income Tax
      Return for any Tax period ending on or before or including the Distribution
      Date
      except to the extent the CombiMatrix Tax Group is liable for such Taxes pursuant
      to Section 2.02 or 3.02;

     

    (iv)  all
      Taxes
      for any Tax period (whether beginning before, on or after the Distribution
      Date)
      that would not have been payable but for the breach by any member of the Acacia
      Tax Group of any representation, warranty, covenant or obligation under this
      Agreement;

     

    (v)  all
      liability for a breach by any member of the Acacia Tax Group of any
      representation, warranty, covenant or obligation under this
      Agreement;

     

    
      
        
        

      

      
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    (vi)  all
      Taxes
      imposed in connection with the transactions contemplated by the Separation
      Agreements or any other agreement entered into for the purpose of implementing
      the Distribution;

     

    (vii)  all
      Taxes
      for which Acacia is liable pursuant to Section 3.02; and

     

    (viii)  all
      liability for any reasonable legal, accounting, appraisal, consulting or similar
      fees and expenses relating to the foregoing.

     

    Notwithstanding
      the foregoing and subject to Section 3.01(b) and Section 3.02, Acacia shall
      not
      indemnify, defend or hold harmless any member of the CombiMatrix Tax Group
      from
      any liability for Taxes attributable to any action (including the making of
      an
      election under Section 338 of the Code) taken by any member of the CombiMatrix
      Tax Group after the Distribution (other than any such action expressly required
      or otherwise expressly contemplated by the Separation Agreements or any other
      agreement entered into for the purpose of implementing the Distribution or
      taken
      in the ordinary course of business) (a “Post-Distribution
      Tax Act”).

     

    (b)  CombiMatrix
      Indemnification.
      CombiMatrix shall be liable for, and shall indemnify, defend and hold harmless
      each member of the Acacia Tax Group and each of the respective shareowners,
      directors, officers, employees and agents and each of the heirs, executors,
      successors and assigns of any of the foregoing from and against:

     

    (i)  all
      Taxes
      of any member of the CombiMatrix Tax Group (other than Taxes for which Acacia
      provides indemnification pursuant to Section 3.01(a));

     

    (ii)  all
      Taxes
      for which CombiMatrix is liable pursuant to Section 2.02(e).

     

    (iii)  all
      Taxes
      for any Tax period (whether beginning before, on or after the Distribution
      Date)
      that would not have been payable but for the breach by any member of the
      CombiMatrix Tax Group of any representation, warranty, covenant or obligation
      under this Agreement;

     

    (iv)  all
      liability for a breach by any member of the CombiMatrix Tax Group of any
      representation, warranty, covenant or obligation under this
      Agreement;

     

    (v)  all
      Taxes
      for which CombiMatrix is liable pursuant to Section 3.02;

     

    (vi)  all
      Taxes
      attributable to a Post-Distribution Tax Act; and

     

    (vii)  all
      liability for any reasonable legal, accounting, appraisal, consulting or similar
      fees and expenses relating to the foregoing.

     

    Section
      3.02  CombiMatrix
      Tax Acts.

     

    (a)  Notwithstanding
      Section 3.01, CombiMatrix agrees to indemnify, defend and hold harmless each
      member of the Acacia Tax Group and each of the respective shareowners,
      directors, officers, employees and agents and each of the heirs, executors,
      successors and assigns of any of the foregoing from and against any Taxes
      resulting from any CombiMatrix Tax Act. A CombiMatrix Tax Act shall mean any
      action specified on Schedule 3.02(a) attached hereto.

     

    
      
        
        

      

      
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    (b)  CombiMatrix
      shall, and shall cause each member of the CombiMatrix Tax Group to, comply
      with
      and take no action inconsistent with the CombiMatrix Tax Representation Letter,
      unless, pursuant to a favorable ruling letter obtained from the IRS which is
      satisfactory to Acacia or the advice of Greenberg Traurig, LLP or other
      nationally recognized tax counsel to Acacia, which advice shall be satisfactory
      to Acacia, such act or omission would not adversely affect the U.S. federal
      Income Tax consequences of the Distribution to Acacia or the shareowners of
      Acacia. Notwithstanding Sections 3.01(b)(iv), 3.01(b)(v), and 3.01(b)(vii),
      the
      parties intend that the sole remedy for breach of the covenants contained in
      this Section 3.02(b) shall be as set forth in Section 3.02(a).

     

    (c)  Notwithstanding
      the foregoing, a CombiMatrix Tax Act shall not include any transaction or action
      specifically disclosed or specifically described in any of the Separation
      Agreements or, except as specifically set forth in Schedule 3.02(c) occurring
      on
      or prior to the Distribution Date, any action taken on or prior to the
      Distribution Date. A CombiMatrix Tax Act shall not include any action on the
      part of any member of the Acacia Tax Group.

     

    Section
      3.03  Notice
      of Indemnity.
      Whenever a party hereto (hereinafter an “Indemnitee”)
      becomes aware of the existence of an issue raised by any Tax Authority which
      could reasonably be expected to result in a determination that would increase
      the liability for any Tax of the other party hereto or any member of its Tax
      Group for any Tax period or require a payment hereunder by the other party
      (hereinafter an “Indemnity
      Issue”),
      the
      Indemnitee shall in good faith promptly give notice to such other party
      (hereinafter the “Indemnitor”)
      of
      such Indemnity Issue. The failure of the Indemnitee to give such notice shall
      not relieve the Indemnitor of its obligations under this Agreement, except
      to
      the extent such Indemnitor or a member of its Tax Group is actually prejudiced
      by such failure to give notice.

     

    Section
      3.04  Payments.

     

    (a)  Timing
      Adjustments.

     

    (i)  Timing
      Differences.
      If a
      Tax audit proceeding or an amendment of a Tax Return results in a Timing
      Difference, and such Timing Difference results in a decrease in an indemnity
      obligation Acacia has or would otherwise have under Section 3.01(a) and/or
      an
      increase in the amount of a Tax refund or credit to which Acacia is entitled
      under Section 2.03, then in each Post-Tax Indemnification Period in which the
      CombiMatrix Tax Group Actually Realizes an Income Tax Detriment, Acacia shall
      pay to CombiMatrix an amount equal to such Income Tax Detriment; provided,
      however,
      that
      the aggregate payments which Acacia shall be required to make under this Section
      3.04(a)(i) with respect to any Timing Difference shall not exceed the aggregate
      amount of the Income Tax Benefits realized by the Acacia Tax Group for all
      taxable periods and the CombiMatrix Tax Group for all Tax Indemnification
      Periods as a result of such Timing Difference. Acacia shall make all such
      payments within ten days after CombiMatrix notifies Acacia that the relevant
      Income Tax Detriment has been Actually Realized.

     

    
      
        
        

      

      
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    (ii)  Reverse
      Timing Differences.
      If a
      Tax audit proceeding or an amendment to a Tax Return results in a Reverse Timing
      Difference, and such Reverse Timing Difference results in an increase in an
      indemnity payment obligation of Acacia under Section 3.01(a) and/or a decrease
      in the amount of a Tax refund or credit to which Acacia is or would otherwise
      be
      entitled under Section 2.03, then in each Post-Tax Indemnification Period in
      which the CombiMatrix Tax Group Actually Realizes an Income Tax Benefit,
      CombiMatrix shall pay to Acacia within ten days after CombiMatrix has Actually
      Realized such Income Tax Benefit an amount equal to such Income Tax Benefit,
      provided,
      however,
      that
      the aggregate payments which CombiMatrix shall be required to make under this
      Section 3.04(a)(ii) with respect to Reverse Timing Differences shall not exceed
      the aggregate amount of the Income Tax Detriments realized by the CombiMatrix
      Tax Group and the Acacia Tax Group for all Tax Indemnification Periods as a
      result of such Reverse Timing Difference.

     

    (b)  Time
      for Payment.
      Except
      as otherwise provided in this Section 3.04(b), any indemnity payment required
      to
      be made pursuant to this Agreement shall be paid within thirty days after the
      indemnified party makes written demand upon the indemnifying party, provided
      that in no event shall such payment be required to be made earlier than five
      (5)
      Business Days prior to the date on which the relevant Taxes (including estimated
      Taxes) are required to be paid (or would be required to be paid if no such
      Taxes
      are due) to the relevant Tax Authority.

     

    (c)  Payments
      Net of Taxes and Tax Benefits.
      The
      amount of any payment under this Agreement shall be (i) reduced to take into
      account any net Tax benefit realized by the recipient’s Tax Group arising from
      the incurrence or payment by such recipient’s Tax Group of any amount in respect
      of which such payment is made and (ii) increased to take into account any net
      Tax cost incurred by the recipient’s Tax Group as a result of the receipt or
      accrual of payments hereunder (grossed-up for such increase), in each case
      determined by treating the recipient as recognizing all other items of income,
      gain, loss, deduction or credit before recognizing any item arising from the
      receipt of accrual of any payment hereunder. Except as otherwise provided in
      this Agreement or unless the parties otherwise agree to an alternative method
      for determining the present value of any such anticipated Tax benefit or Tax
      cost, any payment hereunder shall initially be made without regard to this
      section and shall be increased or reduced to reflect any such net Tax cost
      (including gross-up) or net Tax benefit only after the recipient’s Tax Group has
      Actually Realized such Tax cost or Tax benefit.

     

    (d)  Right
      to Offset.
      Any
      party making a payment under this Agreement shall have the right to reduce
      any
      such payment by any undisputed amounts owed to it by the other party to this
      Agreement.

     

    (e)  Characterization
      of Payments.
      It is
      the intention of the parties to this Agreement that payments made pursuant
      to
      this Agreement are to be treated as relating back to the Distribution as an
      adjustment to capital (i.e.,
      capital
      contribution or distribution), and the parties shall not take any position
      inconsistent with such intention before any Tax Authority, except to the extent
      that a final determination (as defined in Section 1313 of the Code) with respect
      to the recipient party causes any such payment not to be so
      treated.

     

    
      
        
        

      

      
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    Section
      3.05  Tax
      Contests.
      The
      Indemnitor and its representatives, at the Indemnitor’s expense, shall be
      entitled to participate (a) in all conferences, meetings and proceedings with
      any Tax Authority, the subject matter of which is or includes an Indemnity
      Issue
      and (b) in all appearances before any court, the subject matter of which is
      or
      includes an Indemnity Issue. The party who has responsibility for filing the
      Tax
      Return under this Agreement (the “Responsible
      Party”)
      with
      respect to which there could be an increase in liability for any Tax or with
      respect to which a payment could be required hereunder shall have the right
      to
      decide as between the parties hereto how such matter is to be dealt with and
      finally resolved with the appropriate Tax Authority and shall control all audits
      and similar proceedings. If no Tax Return is or was required to be filed in
      respect of an Indemnity Issue, the Indemnitor shall be treated as the
      Responsible Party with respect thereto. The Responsible Party agrees to
      cooperate in the settlement of any Indemnity Issue with the other party and
      to
      take such other party’s interests into account.

     

    ARTICLE
      IV

     

    OPTIONS;
      COMPENSATION PAYMENTS;

    INTEREST
      CHARGE FOR LATE PAYMENTS;

    CURRENCY
      CALCULATIONS; EFFECTIVE TIME OF TRANSACTIONS

     

    Section
      4.01  Stock
      Options; Restricted Shares.

     

    (a)  Stock
      Option Adjustments.
      CBMX
      Tracking Stock Options outstanding at the time of the Distribution will be
      adjusted in accordance with the terms of the Employee Matters Agreement. Acacia
      Restricted Shares outstanding at the time of the Distribution will be adjusted
      in accordance with the terms of the underlying plan and award for such Acacia
      Restricted Shares and the Distribution Agreement.

     

    (b)  Tax
      Deductions.
      Notwithstanding anything to the contrary in this Agreement, unless the IRS
      issues a contrary private letter ruling to Acacia or CombiMatrix, or Acacia
      and
      CombiMatrix otherwise agree in writing, (i) the Acacia Tax Group (and not the
      CombiMatrix Tax Group) shall claim any Post-Distribution Date Tax deductions
      in
      respect of CBMX Tracking Stock Options exercised by, or Acacia Restricted Shares
      held by, Acacia Group Employees and Former Employees, (ii) the Acacia Tax Group
      (and not the CombiMatrix Tax Group) shall claim any Post-Distribution Date
      Tax
      deductions in respect of CombiMatrix Common Stock Options exercised by, or
      CombiMatrix Restricted Shares held by, Acacia Group Employees and Former
      Employees and Acacia shall pay to CombiMatrix the amount received as a result
      of
      any Tax benefit realized in respect of such Tax deductions within ten days
      after
      such amount is Actually Realized by Acacia, (iii) the CombiMatrix Tax Group
      (and
      not the Acacia Tax Group) shall claim any Post-Distribution Date Tax deductions
      in respect of CBMX Tracking Stock Options exercised by, or Acacia Restricted
      Shares held by, CombiMatrix Group Employees and Former Employees and CombiMatrix
      shall pay to Acacia the amount received as a result of any Tax benefit realized
      in respect of such Tax deductions within ten days after such amount is Actually
      Realized by CombiMatrix, and (iv) the CombiMatrix Tax Group (and not the Acacia
      Tax Group) shall claim the Post-Distribution Date Tax deductions in respect
      of
      the CombiMatrix Common Stock Options exercised by, or CombiMatrix Restricted
      Shares held by, CombiMatrix Group Employees and Former Employees.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

       

    

    (c)  Notices,
      Withholding, Reporting.

     

    (i)  Acacia
      shall promptly notify CombiMatrix of any post-Distribution Date event giving
      rise to income to any CombiMatrix Group Employees and Former Employees in
      connection with the CBMX Tracking Stock Options and Acacia Restricted Shares
      and, if required by law, CombiMatrix shall withhold applicable Taxes and satisfy
      applicable Tax reporting obligations in connection therewith. Acacia shall
      within ten days of demand thereof reimburse CombiMatrix for all reasonable
      out-of-pocket expenses incurred in connection with the CBMX Tracking Stock
      Options and Acacia Restricted Shares, including with respect to incremental
      Tax
      reporting obligations and any incremental employment Tax obligations; provided
      that CombiMatrix shall use reasonable efforts to collect any such amounts
      required to be paid by CombiMatrix Group Employees and Former Employees from
      such CombiMatrix Group Employees and Former Employees.

     

    (ii)  CombiMatrix
      shall promptly notify Acacia of any post-Distribution Date event giving rise
      to
      income to any non-CombiMatrix Group Employees and Former Employees in connection
      with the CombiMatrix Common Stock Options and CombiMatrix Restricted Shares
      and,
      if required by law, Acacia shall withhold applicable Taxes and satisfy
      applicable Tax reporting obligations in connection therewith. CombiMatrix shall
      within ten days of demand thereof reimburse Acacia for all reasonable
      out-of-pocket expenses incurred in connection with the CombiMatrix Common Stock
      Options and CombiMatrix Restricted Shares, including with respect to incremental
      Tax reporting obligations and any incremental employment Tax obligations;
      provided that Acacia shall use reasonable efforts to collect any such amounts
      required to be paid by non-CombiMatrix Group Employees and Former Employees
      from
      such non-CombiMatrix Group Employees and Former Employees.

     

    (d)  Tax
      Audit Adjustments.
      Notwithstanding the provisions of Section 4.01(b), in the event a Tax audit
      proceeding shall determine (by settlement or otherwise), or the parties
      otherwise determine pursuant to Section 4.03, that all or a portion of the
      Tax
      deductions in respect of CBMX Tracking Stock Options and Acacia Restricted
      Shares or CombiMatrix Common Stock Options and CombiMatrix Restricted Shares
      should have been claimed by the CombiMatrix Tax Group or the Acacia Tax Group,
      respectively, the CombiMatrix Tax Group or the Acacia Tax Group, respectively,
      shall claim such Tax deductions (by an amended Tax Return or otherwise) and
      shall pay to Acacia or CombiMatrix, as the case may be, the amount of any Tax
      refund or credit arising in respect of such Tax deduction within ten days after
      such Tax refund or credit is Actually Realized by the CombiMatrix Tax Group
      or
      the Acacia Tax Group, as the case may be.

     

    (e)  Status
      of Directors.
      For
      purposes of this Section 4.01 (except as it relates to employment and
      withholding Taxes), (i) Acacia or CombiMatrix Common Stock Options and
      Restricted Shares held by present or former non-employee members of the Acacia
      Board of Directors shall be treated as held by present or former employees
      of
      Acacia, (ii) Acacia or CombiMatrix Common Stock Options and Restricted Shares
      held by present or former non-employee members of the CombiMatrix Board of
      Directors shall be treated as held by present or former employees of
      CombiMatrix, and (iii) notwithstanding (i) or (ii) above, Acacia or CombiMatrix
      Common Stock Options and Restricted Shares held by individuals who, as of the
      Distribution Date, were both non-employee members of the Acacia Board of
      Directors and non-employee members of the CombiMatrix Board of Directors shall
      be treated as (A) employees of Acacia with respect to CBMX Tracking Stock
      Options exercised by, or Acacia Restricted Shares held by, such individuals
      and
      (B) employees of CombiMatrix with respect to CombiMatrix Common Stock Options
      exercised by, or CombiMatrix Restricted Shares held by, such
      individuals.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

       

    

    Section
      4.02  Compensation
      Payments.

     

    (a)  Tax
      Deductions.
      Notwithstanding anything to the contrary in this Agreement, unless Acacia and
      CombiMatrix otherwise agree in writing, (i) the CombiMatrix Tax Group (and
      not
      the Acacia Tax Group) shall claim the Post-Distribution Date Tax deductions
      in
      respect of Compensation Payments paid by the CombiMatrix Tax Group to all other
      CombiMatrix Group Employees and Former Employees, and (ii) the Acacia Tax Group
      (and not the CombiMatrix Tax Group) shall claim the Post-Distribution Date
      Tax
      deductions in respect of Compensation Payments paid by the Acacia Tax Group
      to
      all other CombiMatrix Group Employees and Former Employees.

     

    (b)  Notices,
      Withholding, Reporting.
      The
      party responsible for making the Compensation Payments pursuant to the Employee
      Matters Agreement shall withhold applicable Taxes and satisfy applicable Tax
      reporting obligations in connection with the Compensation Payments made to
      all
      CombiMatrix Group Employees and Former Employees.

     

    (c)  Tax
      Audit Adjustments.
      Notwithstanding the provisions of Section 4.02(a), in the event a Tax audit
      proceeding shall determine (by settlement or otherwise), or the parties
      otherwise determine pursuant to Section 4.03, that all or a portion of the
      Tax
      deductions in respect of Compensation Payments paid to CombiMatrix Group
      Employees and Former Employees was not available to the party claiming the
      Tax
      deduction, then the appropriate party shall claim such Tax deductions (by an
      amended Tax Return or otherwise) and shall pay to the party which had previously
      claimed such Tax deduction, within ten days after such Tax deduction has been
      Actually Realized by the such appropriate party, the amount of the resulting
      Tax
      benefit to such appropriate party.

     

    Section
      4.03  Change
      in Law.
      Notwithstanding the agreement with respect to reporting of Tax items and the
      claiming of the deductions set forth in Article 4 of this Agreement, neither
      the
      CombiMatrix Tax Group nor the Acacia Tax Group shall have any obligation to
      report any such Tax items or claim such deductions as set forth in such Article
      in the event that either such party determines, based on an opinion of
      nationally recognized tax counsel, which opinion shall be satisfactory to the
      other party, that there is no substantial authority to support reporting such
      Tax items or claiming such deductions on a Tax Return filed by such party as
      a
      result of a change in or amendment to any law or regulation, or any change
      in
      the official interpretation thereof, effective or occurring after the date
      of
      this Agreement, and such Tax Group provides prompt notice to the other Tax
      Group
      of any such determination.

     

    Section
      4.04  Interest
      Charge for Late Payments.
      Any
      amount due and owing by one party to the other party pursuant to this Agreement
      that is not paid when due shall bear interest from the due date thereof until
      paid at a rate equal to the JPMorgan Chase Bank base rate in effect from time
      to
      time during such period plus 1%.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

    Section
      4.05  Currency
      Calculations.
      All
      currency calculations shall be made in accordance with Section 7.09 of the
      Distribution Agreement.

     

    Section
      4.06  Effective
      Time of Transaction.
      Acacia
      and CombiMatrix agree that any transaction that, pursuant to the Distribution
      Agreement, is expressly effective immediately after the Time of Distribution
      shall be treated for federal Income Tax purposes as occurring at the beginning
      of the day following the Distribution Date.

     

    ARTICLE
      V

     

    COOPERATION
      AND EXCHANGE OF INFORMATION

     

    Section
      5.01  Inconsistent
      Actions.
      Each
      party to this Agreement agrees (i) to, and to cause each of the relevant members
      of its Tax Group to, report the Distribution as a transaction described in
      Section 368(a)(1)(D) of the Code on all Tax Returns and other filings, (ii)
      to
      use its best efforts to ensure that the Distribution receives such treatment
      for
      U.S. federal Income Tax purposes and (iii) that, unless it has obtained the
      prior written consent of the other party, it (and the members of its Tax Group)
      shall not take any action inconsistent with, or fail to take any action required
      by, the Separation Agreements.

     

    Section
      5.02  Cooperation
      and Exchange of Information.
      Each
      party hereto agrees to provide, and to cause each member of its Tax Group to
      provide, such cooperation and information as such other party shall request,
      on
      a timely basis, in connection with the preparation or filing of any Tax Return
      or claim for Tax refund not inconsistent with this Agreement or in conducting
      any Tax audit, Tax dispute, or otherwise in respect of Taxes or to carry out
      the
      provisions of this Agreement. To the extent necessary to carry out the purposes
      of this Agreement and subject to the other provisions of this Agreement, such
      cooperation and information shall include without limitation the non-exclusive
      designation of an officer of Acacia as an officer of CombiMatrix and each of
      its
      affiliates (for the purpose of signing Tax Returns, cashing refund checks,
      pursuing refund claims, dealing with Tax Authorities and defending audits);
      promptly forwarding to the other party, where relevant, copies of appropriate
      notices and forms or other communications received from or sent to any Tax
      Authority which relate to the Tax Indemnification Period; providing copies
      of
      all relevant Tax Returns for the Tax Indemnification Period, together with
      accompanying schedules and related workpapers, documents relating to rulings
      or
      other determinations by Tax Authorities, including without limitation, foreign
      Tax Authorities, and records concerning the ownership and Tax basis of property,
      which either party may possess; and making its employees involved in the
      research and development process available to the other party and having such
      employees provide such assistance as the other party may require for such
      purposes, provided, however, that neither party shall be obligated to provide
      the other party Tax Returns, documentation or other information of a proprietary
      or confidential nature for purposes of verifying any calculation, and provided
      further, that in any such case where one party does not provide the other party
      with Tax Returns, documentation or information because it is proprietary or
      confidential, both parties shall cooperate in developing mutually acceptable
      procedures including retaining a mutually agreeable accounting firm to review
      such Tax Returns, documentation or information for purposes of verifying such
      calculation. Subject to the rights of the CombiMatrix Tax Group under the other
      provisions of this Agreement, such officer shall have the authority to execute
      powers of attorney (including Form 2848) on behalf of each member of the
      CombiMatrix Tax Group with respect to Tax Returns for the Tax Indemnification
      Period. Each party to this Agreement shall make, or shall cause its affiliates
      to make, its employees and facilities available on a mutually convenient basis
      to provide an explanation of any documents or information provided
      hereunder.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

       

    

    Section
      5.03  Tax
      Records.

     

    (a)  Acacia
      and CombiMatrix agree to (and to cause each member of their respective Tax
      Group
      to) (i) retain all Tax Returns, related schedules and workpapers, and all
      material records and other documents as required under Section 6001 of the
      Code
      and the regulations promulgated thereunder relating thereto existing on the
      date
      hereof or created through the Distribution Date, for a period of at least ten
      years following the Distribution Date and (ii) allow the party to this
      Agreement, at times and dates reasonably acceptable to the retaining party,
      to
      inspect, review and make copies of such records, as Acacia and CombiMatrix
      may
      reasonably deem necessary or appropriate from time to time. In addition, after
      the expiration of such ten-year period, such Tax Returns, related schedules
      and
      workpapers, and material records shall not be destroyed or otherwise disposed
      of
      at any time, unless, prior to such destruction or disposal, (A) the party
      proposing to destroy or otherwise dispose of such records shall provide no
      less
      than 30 days’ prior written notice to the other party, specifying in reasonable
      detail the records proposed to be destroyed or disposed of and (B) if a
      recipient of such notice shall request in writing prior to the scheduled date
      for such destruction or disposal that any of the records proposed to be
      destroyed or disposed of be delivered to such requesting party, the party
      proposing the destruction or disposal shall promptly arrange for the delivery
      of
      such requested records at the expense of the party requesting such
      records.

     

    (b)  Notwithstanding
      anything in this Agreement to the contrary, if any party fails to comply with
      the requirements of Section 5.05(a) hereof, the party failing so to comply
      shall
      be liable for, and shall hold the other party, harmless from, any Taxes
      (including without limitation, penalties for failure to comply with the record
      retention requirements of the Code) and other costs resulting from such party’s
      failure to comply.

     

    ARTICLE
      VI

     

    MISCELLANEOUS

     

    Section
      6.01  Entire
      Agreement; Construction.
      This
      Agreement, the Distribution Agreement, the other Separation Agreements,
      including any annexes, schedules and exhibits hereto or thereto, and other
      agreements and documents referred to herein and therein, will together
      constitute the entire agreement between the parties with respect to the subject
      matter hereof and thereof and will supersede all prior negotiations, agreements
      and understandings of the parties of any nature, whether oral or written, with
      respect to such subject matter. Notwithstanding any other provisions in the
      Separation Agreements to the contrary, in the event and to the extent that
      there
      is a conflict relating to Taxes between the provisions of this Agreement and
      the
      provisions of the Distribution Agreement or any other Separation Agreement,
      the
      provisions of this Agreement will control.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

       

    

    Section
      6.02  Effectiveness.
      All
      covenants and agreements of the parties contained in this Agreement shall be
      subject to and conditioned upon the Distribution becoming
      effective.

     

    Section
      6.03  Survival
      of Agreements.
      Except
      as otherwise contemplated by the Separation Agreements, all covenants and
      agreements of the parties contained in this Agreement will remain in full force
      and effect and survive the Time of Distribution.

     

    Section
      6.04  Governing
      Law.
      This
      Agreement will be governed by and construed in accordance with the internal
      laws
      of the State of Delaware applicable to contracts made and to be performed
      entirely within such State, without regard to the conflicts of law principles
      of
      such State.

     

    Section
      6.05  Notices.
      All
      notices, requests, claims, demands and other communications required or
      permitted to be given hereunder will be in writing and will be delivered by
      hand, telecopied, e-mailed or sent, postage prepaid, by registered, certified
      or
      express mail or reputable overnight courier service and will be deemed given
      when so delivered by hand or telecopied, when e-mail confirmation is received
      if
      delivered by e-mail, or three (3) Business Days after being so mailed (one
      (1)
      Business Day in the case of express mail or overnight courier service). All
      such
      notices, requests, claims, demands and other communications will be addressed
      as
      set forth in Section 7.04 of the Distribution Agreement, or pursuant to such
      other instructions as may be designated in writing by the party to receive
      such
      notice.

     

    Section
      6.06  Amendments.
      This
      Agreement may not be amended, modified or supplemented except by a written
      agreement executed by Acacia and CombiMatrix.

     

    Section
      6.07  Successors
      and Assigns.
      Neither
      party to this Agreement will convey, assign or otherwise transfer any of its
      rights or obligations under this Agreement without the prior written consent
      of
      the other party in its sole and absolute discretion other than as expressly
      provided herein, any party may (without obtaining any consent) assign any of
      its
      rights hereunder to a successor to all or any part of its business. Any such
      conveyance, assignment or transfer requiring the prior written consent of
      another party which is made without such consent will be void ab
      initio.
      No
      assignment of this Agreement will relieve the assigning party of its obligations
      hereunder.

     

    Section
      6.08  Captions;
      Currency.
      The
      article, section and paragraph captions herein and the table of contents hereto
      are for convenience of reference only, do not constitute part of this Agreement
      and will not be deemed to limit or otherwise affect any of the provisions
      hereof. Unless otherwise specified, all references herein to numbered articles
      or sections are to articles and sections of this Agreement and all references
      herein to schedules are to schedules to this Agreement. Unless otherwise
      specified, all references contained in this Agreement or in any schedule
      referred to herein to dollars or “$” shall mean U.S. dollars.

     

    Section
      6.09  Severability.
      If any
      provision of this Agreement or the application thereof to any person or
      circumstance is determined by a court of competent jurisdiction to be invalid,
      void or unenforceable, the remaining provisions hereof, or the application
      of
      such provision to persons or circumstances other than those as to which it
      has
      been held invalid or unenforceable, will remain in full force and effect and
      will in no way be affected, impaired or invalidated thereby. If the economic
      or
      legal substance of the transactions contemplated hereby is affected in any
      manner adverse to any party as a result thereof, the parties will negotiate
      in
      good faith in an effort to agree upon a suitable and equitable substitute
      provision to effect the original intent of the parties.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

       

    

    Section
      6.10  Parties
      in Interest.
      Except
      for the provisions of Article III relating to Tax Indemnification, this
      Agreement is solely for the benefit of the parties hereto and the respective
      members of their Tax Group and should not be deemed to confer upon third parties
      (including any employee of Acacia or CombiMatrix or of any Acacia or CombiMatrix
      subsidiary) any remedy, claim, reimbursement, claim of action or other right
      in
      excess of those existing without reference to this Agreement.

     

    Section
      6.11  Schedules.
      All
      schedules attached hereto are hereby incorporated in and made a part of this
      Agreement as if set forth in full herein. Capitalized terms used in the
      schedules hereto but not otherwise defined therein will have the respective
      meanings assigned to such terms in this Agreement.

     

    Section
      6.12  Termination.
      This
      Agreement may be terminated and the Distribution abandoned at any time prior
      to
      the Distribution Date by and in the sole discretion of the Acacia Board without
      the approval of CombiMatrix or Acacia’s shareowners. In the event of such
      termination, neither party will have any liability of any kind to the other
      party on account of such termination.

     

    Section
      6.13  Waivers;
      Remedies.
      No
      failure or delay by any party hereto in exercising any right, power or privilege
      hereunder will operate as a waiver thereof, nor will any waiver on the part
      of
      any party hereto of any right, power or privilege hereunder operate as a waiver
      of any other right, power or privilege hereunder, nor will any single or partial
      exercise of any right, power or privilege hereunder preclude any other or
      further exercise thereof or the exercise of any other right, power or privilege
      hereunder. Subject to Section 6.17, the rights and remedies herein provided
      are
      cumulative and are not exclusive of any rights or remedies which the parties
      may
      otherwise have at law or in equity.

     

    Section
      6.14  Counterparts.
      This
      Agreement may be executed in separate counterparts, each such counterpart being
      deemed to be an original instrument, and all such counterparts will together
      constitute the same agreement. This Agreement may be executed and delivered
      by
      telecopier with the same force and effect as if it were a manually executed
      and
      delivered counterpart.

     

    Section
      6.15  Performance.
      Each
      party hereto will cause to be performed, and hereby guarantees the performance
      of all actions, agreements and obligations set forth herein to be performed
      by
      any subsidiary or any member of such party’s Tax Group.

     

    Section
      6.16  Interpretation.
      Any
      reference to any federal, state, local, or foreign law shall be deemed also
      to
      refer to all rules and regulations promulgated thereunder, unless the context
      requires otherwise. For the purposes of this Agreement, (i) words in the
      singular shall be held to include the plural and vice
      versa
      and
      words of one gender shall be held to include the other gender as the context
      requires, (ii) the terms “hereof”, “herein”, and “herewith” and words of similar
      import shall, unless otherwise stated, be construed to refer to this Agreement
      as a whole and not to any particular provision of this Agreement and (iii)
      the
      word “including” and words of similar import when used in this Agreement shall
      mean “including, without limitation”.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

    Section
      6.17  Dispute
      Resolution.
      Any
      dispute, claim or controversy arising out of or relating to any provision of
      this Agreement or the breach, performance or validity thereof will be resolved
      in accordance with the procedures set forth in Section 7.05 of the Distribution
      Agreement.

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    [Signature
      Page to Tax Allocation Agreement]

     

    IN
      WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
      duly
      authorized officers of the parties as of the date first hereinabove
      written.

     

     

    
      	 	
              ACACIA
                RESEARCH CORPORATION

               

               

              By:
                        /s/ Paul
                Ryan                                                                    

                   Name:  
                Paul
                Ryan

                    
Title:    
                President
                and Chairman of Board 

               

            
	 	
              COMBIMATRIX
                CORPORATION

               

               

              By:          
                /s/ Amit
                Kumar                                                               

                    Name:   
                Amit
                Kumar

                     
Title:     
                President

            

    

    

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    Schedule
      1.01

     

    CombiMatrix
      Tax Group, Members

     

    
      	
              Existing
                Companies

            	
              Country

            
	
              1.
                CombiMatrix Corporation

            	
              US

            
	
              2.
                CombiMatrix K.K.

            	
              Japan

            
	
              3.
                Advanced Material Sciences

            	
              US

            
	
              4.
                CombiMatrix Molecular Diagnostics, Inc.

            	
              US

            
	
              5.
                CombiMatrix International Holding Corporation

            	
              US

            
	
              6.
                Leuchemix, Inc.

            	
              US

            

    

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      2.01(f)

    Tax
      Returns To Be Filed By Non-Responsible Party

     

    None

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      3.02(a)

     

    CombiMatrix
      Tax Act

     

    The
      actions which shall constitute a “CombiMatrix
      Tax Act”
shall
      mean:

     

    § 355
      Split-off Reorganization of CombiMatrix

     

    
      	 	
              --

            	
              The
                failure of CombiMatrix to directly continue the active conduct of
                the
                historic businesses conducted throughout the five-year period prior
                to the
                Distribution Date using its employees and/or those of its subsidiaries
                to
                perform active and substantial management and operational
                functions.

            

    

     

    
      	 	
              --

            	
              The
                consummation of any transaction or transactions (including making
                any
                change in equity structure (in terms of either value or voting power),
                or
                transactions pursuant to any agreement, understanding, arrangement
                or
                substantial negotiations of any member of the Acacia Tax Group or
                any
                member of the CombiMatrix Tax Group occurring prior to, on or after
                the
                Distribution) pursuant to which one or more persons acquire directly
                or
                indirectly stock possessing 50% or more of the total combined voting
                power
                of all classes of stock of CombiMatrix (or any successor thereto)
                entitled
                to vote or stock possessing 50% or more of the total value of all
                classes
                of stock of CombiMatrix (or are treated as acquiring such interest
                pursuant to Section 355(e) as a result of the acquisition of assets
                of
                CombiMatrix or otherwise) taking into account as may be relevant
                under
                Section 355(e) acquisitions of stock of Acacia or CombiMatrix (or
                any
                successor thereto) occurring prior to, on or after the
                Distribution.

            

    

     

    
      	 	
              --

            	
              The
                liquidation or partial liquidation of CombiMatrix, the merger into
                or
                consolidation with any corporation, or the sale or other disposition
                of
                the assets of CombiMatrix, other than (i) sales or dispositions in
                the
                ordinary course of business or (ii) transactions described in Section
                368(a)(2)(C) of the Code.

            

    

     

    
      	 	
              --

            	
              The
                failure of the Distribution to qualify as a Code Section 368(a)(1)(D)
                split-off reorganization because of a transfer of assets held by
                CombiMatrix to an affiliate in a transaction described in Section
                351 or
                Section 118 of the Code.

            

    

     

    
      	 	
              --

            	
              The
                failure of CombiMatrix to satisfy the “active trade or business” test of
                Section 355(b) of the Code.

            

    

     

    
      	 	
              --

            	
              The
                failure of the distribution of the stock of CombiMatrix to satisfy
                the
                Code Section 355 “control” requirement because of negotiations, agreements
                or arrangements prior to the Distribution that are associated with
                a
                post-Distribution event.

            

    

     

    
      	 	
              --

            	
              Any
                act or conduct undertaken by CombiMatrix or any member of the CombiMatrix
                Tax Group which causes the Distribution to be taxable to Acacia or
                any
                member of the Acacia Tax Group.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Schedule
      3.02(b)

     

    CombiMatrix
      Tax Representation Letter

     

    CombiMatrix
      Corporation

    6500
      Harbour Heights Parkway

    Suite
      301

    Mukilteo,
      WA 98275

    
 

    December
      [__], 2006

    Acacia
      Research Corporation

    500
      Newport Center Dr., 7th Floor

    Newport
      Beach, CA 92660

     

    Dear
      Sirs:

     

    In
      connection with the proposed Distribution, as that term is defined and described
      in the Distribution Agreement dated as of December [___], 2006 (the
“Distribution Agreement”), between Acacia Research Corporation., a Delaware
      corporation (“Acacia”), and CombiMatrix Corporation, a Delaware corporation and
      a wholly owned subsidiary of Acacia (“CombiMatrix”), Greenberg Traurig, LLP
      (“GT”) will render its opinion (“Opinion”) with respect to certain United States
      federal income tax consequences of the Distribution. In connection with the
      issuance of the Opinion, GT has requested from Acacia, and Acacia has agreed
      to
      provide to GT, certain representations and warranties concerning CombiMatrix
      and
      the Distribution (“Acacia Tax Representations”). Acacia, in turn, has requested
      from CombiMatrix certain representation and warranties to enable Acacia to
      provide the Acacia Tax Representations. 

     

    Accordingly,
      the undersigned officer of CombiMatrix hereby represents and certifies to
      Acacia, after due inquiry and investigation, that the facts which are described
      herein are true, correct and complete in all material respects, and further
      certifies as follows (capitalized terms used herein and not otherwise defined
      herein shall have the respective meanings attributed thereto in the Tax
      Allocation Agreement, dated as of December [___], 2006 (the “Tax Allocation
      Agreement”) between Acacia and CombiMatrix):

     

    1.    CombiMatrix
      was incorporated in California in 1995, reincorporated in Delaware in 2000,
      and
      reorganized on December 13, 2002, as the result of a forward triangular tax-free
      merger into a wholly-owned subsidiary of Acacia. CombiMatrix files its federal
      income tax returns on a December 31 year basis.

    

    2.    Immediately
      prior to the Distribution, CombiMatrix will have outstanding one class of stock,
      the CombiMatrix Common Stock, all of which will be owned by Acacia.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    3.    To
      the
      best of CombiMatrix’s knowledge, CombiMatrix has not been a United States real
      property holding corporation, as defined in Section 897(c)(2) of the Code,
      at
      any time during the five-year period ending on the date of the Distribution,
      and
      CombiMatrix will not be a United States real property holding corporation
      immediately after the Distribution.

    

    4.    To
      the
      best of CombiMatrix’s knowledge, there are no planned or intended stock
      issuances, redemptions or dispositions of the stock of CombiMatrix aside from
      (i) any necessary recapitalization of CombiMatrix Common Stock prior to the
      Distribution so that the number of outstanding shares of CombiMatrix Common
      Stock are equal to the number of outstanding shares of Acacia
      Research--CombiMatrix common stock (the “Tracking Stock”), (ii) the payment
      of cash in lieu of fractional shares in the Distribution, (iii) the
      issuance of any CombiMatrix Common Stock in connection with various benefit
      plans or upon the exercise of any warrants (described in 10 below), and
 (iv) the issuance of shares in a financing that is not part of a plan or
      series of related transactions pursuant to which one or more persons will
      acquire, directly or indirectly, a 50% or greater interest (measured by either
      vote or value) in CombiMatrix. The payment of cash in lieu of fractional
      shares of CombiMatrix is solely for the purposes of avoiding the expense and
      inconvenience to CombiMatrix of issuing fractional shares and does not represent
      separately bargained-for consideration. The method used for handling fractional
      share interests is designed to limit the amount of cash received by any one
      shareholder to less than the value of one full share of CombiMatrix Common
      Stock.

    

    5.    Acacia
      has maintained “control” of CombiMatrix within the meaning of Sections
      368(a)(1)(D) and 368(c) of the Code since December 13, 2002. Taking into account
      the CombiMatrix fractional shares, as described above, Acacia’s shareholders
      will be in “control” of CombiMatrix immediately after the
      Distribution.

    

    6.    The
      fair
      market value of the CombiMatrix Common Stock and other consideration to be
      received by each shareholder of Acacia will be approximately equal to the fair
      market value of the CombiMatrix Tracking Stock surrendered by the shareholders
      in the exchange.

    

    7.    Immediately
      prior to the Distribution, Acacia will recapitalize CombiMatrix so that the
      number of outstanding shares of CombiMatrix Common Stock are equal to the number
      of outstanding shares of CombiMatrix Tracking Stock.

    

    8.    CombiMatrix
      will not have any debt (long-term or short-term) owed to unrelated third party
      creditors at the time of the Distribution.

    

    9.    Any
      intercompany debt owed by CombiMatrix and its subsidiaries to Acacia and its
      subsidiaries will be settled and eliminated. No intercompany debt will exist
      between the Acacia Tax Group and the CombiMatrix Tax Group immediately after
      the
      Distribution other than (1) intercompany debt that will be repaid in connection
      with the Distribution and (ii) certain obligations pursuant to the Distribution
      Agreement.

    

    10.         
      At
      the
      time of Distribution, CombiMatrix will issue to the persons specified on
Schedule
      1,
      warrants to purchase a number of shares of CombiMatrix Common Stock
      (“CombiMatrix Warrant”), in respect of a warrant currently held by such persons
      to purchase the number of shares of CombiMatrix Tracking Stock (“AR-CBMX
      Warrant”). At the time of the Distribution, the AR-CBMX Warrant will be adjusted
      to become, in addition to the AR-CBMX Warrant, the CombiMatrix Warrant. The
      exercise prices of the CombiMatrix Warrant and the AR-CBMX Warrant and the
      number of shares subject to such warrants will be adjusted using a formula
      that
      will ensure that (1) the aggregate intrinsic values of the warrants
      immediately before and after the Distribution are the same, (2) the ratio
      of the exercise price per warrant to the market value per share is the same
      immediately before and after the Distribution, and (3) the vesting
      provisions and exercise period of the CombiMatrix Warrant are the same as the
      original vesting provisions and exercise period of the AR-CBMX
      Warrant.

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    11.    None
      of
      the CombiMatrix Warrants should be considered a stock interest.

    

    12.    Aside
      from the CombiMatrix Common Stock outstanding at the time of the Distribution,
      CombiMatrix will have no stock interests outstanding at the time of the
      Distribution.

    

    13.    None
      of
      the shareholders of Acacia will receive debt securities of CombiMatrix in the
      Distribution.

    

    14.    Acacia
      has no debt security holders. No debt securities are to be exchanged in the
      Distribution.

    

    15.    The
      stock
      options to be issued by CombiMatrix as compensation to employees, directors
      and/or independent contractors (i) will contain customary terms and
      conditions, (ii) will be granted in connection with the performance of
      services for CombiMatrix or a person related to the grantor under section
      355(d)(7)(A) of the Code, (iii) will not be excessive by reference to the
      services performed, (iv) will be nontransferable within the meaning of
      Treasury Regulation Section 1.83-3(d) immediately after the Distribution or
      within six months thereafter, and (v) will not have a readily ascertainable
      fair market value as defined in Treasury Regulation Section 1.83-7(b)
      immediately after the Distribution and within six months
      thereafter.

    

    16.    For
      each
      of the past five years, (a) CombiMatrix has directly conducted the
      CombiMatrix Business, and (b) the CombiMatrix Business has had gross
      receipts and operating expenses representative of the active conduct of a trade
      or business, and, in this connection, has had employees performing active and
      substantial management and operational functions. There have been no substantial
      operational changes to the CombiMatrix Business since August 30, 2006, the
      date
      Internal Revenue Service issued a Private Letter Ruling to Acacia regarding
      the
      Distribution, a copy of which is attached as Exhibit
      1
      hereto.

    

    17.    The
      employee payroll expense, headcount information and description of employees’
titles, functions and types of duties set forth in Exhibit
      2
      attached
      hereto and relating to the CombiMatrix Business are true, correct and complete
      in all material respects.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    18.    There
      has
      not been a substantial change in the type of business conducted or the method
      of
      conducting the CombiMatrix Business during the five-year period ending on the
      date hereof.

     

    19.    The
      assets and businesses which were acquired within the past five (5) years in
      taxable transactions, do not form part of the assets and businesses upon which
      CombiMatrix or any of its businesses relies to satisfy the active conduct of
      a
      trade or business test set forth in Section 355(b)(2).

    

    20.    None
      of
      the real property, intellectual property, or other intangible property
      historically occupied or used by the CombiMatrix Business will be separated
      in
      the transaction from its business.

    

    21.    The
      gross
      assets of the CombiMatrix Business trade or business to be directly conducted
      by
      CombiMatrix and relied upon by CombiMatrix to satisfy the active trade or
      business requirement of Section 355(b) will have a fair market value that is
      five percent (5%) or more of the total fair market value of the gross assets
      of
      CombiMatrix immediately following the Distribution.

    

    22.    Following
      the Distribution, Acacia and CombiMatrix will each continue the active conduct
      of its business, independently and with its separate employees. Additionally,
      following the Distribution, neither Acacia nor CombiMatrix will share the
      services of any employees, and there are no planned or intended substantial
      reductions in business activity for any active business.

    

    23.    Payments,
      if any, made in connection with all continuing transactions between Acacia
      and
      CombiMatrix (or any of their affiliates) after the Distribution will be for
      fair
      market value based on terms and conditions arrived at by the parties bargaining
      at arm’s length.

    

    24.    CombiMatrix
      has no plan or intention not to continue, and during the one-year period
      following the Distribution will continue, the active conduct of its businesses,
      as constituted immediately after the Distribution, independently and with its
      separate employees, and it will use a significant portion of its business assets
      as so constituted in such businesses.

    

    25.    CombiMatrix
      is not an investment company within the meaning the Section 368(a)(2)(F)(iii)
      and (iv) of the Code.

    

    26.    CombiMatrix
      has no plan or intention to, and will not during the one-year period following
      the Distribution, liquidate, merge with any other corporation or sell or
      otherwise dispose of any of its historic assets or businesses subsequent to
      the
      Distribution, except for (a) sales or dispositions in the ordinary course
      of business, (b) transactions described in Section 368(a)(2)(C) of the
      Code, or (c) sales or other dispositions of assets of such corporation
      having a gross fair market value (determined based on disposition proceeds,
      including the assumption of debt) that in the aggregate does not exceed fifty
      percent (50%) of the total fair market value of such company’s
      assets.

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    27.    At
      the
      time of the Distribution, CombiMatrix will not have outstanding any warrants,
      options, convertible securities, or any other type of right pursuant to which
      any person could acquire stock in CombiMatrix, except for certain employee
      stock
      options and the AR-CBMX Warrants.

     

    28.    CombiMatrix
      has no plan or intention to, and for a period of one (1) year following the
      Distribution will not, transfer or cause to be transferred any assets held
      by
      CombiMatrix to an affiliate in a transaction described in Section 351 or Section
      118 of the Code.

    

    29.    The
      Distribution transaction is not used principally as a device for the
      distribution of the earnings and profits of Acacia or CombiMatrix or
      both.

    

    30.    For
      purposes of Section 355(d), immediately after the Distribution, no person
      (determined after applying Section 355(d)(7)) will hold stock possessing fifty
      percent (50%) or more of the total combined voting power of all classes of
      CombiMatrix stock entitled to vote, or fifty percent (50%) or more of the total
      value of shares of all classes of CombiMatrix stock, that was acquired by
      purchase (as defined in Sections 355(d)(5) and (8)) during the five-year period
      (determined after applying Section 355(d)(6)) ending on the date of the
      Distribution.

    

    31.    The
      Distribution is not part of a plan or series of related transactions (within
      the
      meaning of Section 1.355-7T) pursuant to which one or more persons will acquire,
      directly or indirectly, stock possessing a 50-percent or greater interest
      (within the meaning of Section 355(d)(4)) in Acacia or CombiMatrix (including
      any predecessor or successor of any such corporation). 

    

    32.    During
      the two (2)-year period beginning on the Distribution Date, CombiMatrix will
      not
      engage in any transaction or transactions which is part of a plan (or series
      of
      related transactions) related to the Distribution pursuant to which one or
      more
      persons acquire directly or indirectly stock representing a fifty percent (50%)
      or greater interest in CombiMatrix or will be treated as acquiring such interest
      pursuant to Section 355(e) as a result of the acquisition of assets of
      CombiMatrix or otherwise, all within the meaning of Section 355(e).

    

    IN
      WITNESS WHEREOF, I have, on behalf of the Company, executed this CombiMatrix
      Tax
      Representation Letter this December [___], 2006.

     

    
      	 	
               

                  /s/ Amit
                Kumar                                                      
                

              Amit Kumar

              President and Chief Executive
                Officer 

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Schedule
      3.02(c)

     

    Pre-Distribution
      Tax-Free Transactions

     

    Contribution
      of stock of CombiMatrix K.K. by Acacia to CombiMatrix Corporation. Contribution
      of stock of Advanced Material Sciences by Acacia to CombiMatrix
      Corporation.Distribution Agreement

    EXHIBIT 10.2

    
 

    
 

     

      
        

      

    

     

    DISTRIBUTION
      AGREEMENT

     

    by
      and between

     

    ACACIA
      RESEARCH CORPORATION

     

    and

     

    COMBIMATRIX
      CORPORATION

     

    
      
 

     

    December
      21, 2006

     

    
       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    TABLE
      OF CONTENTS

     

    
      	Article I DEFINITIONS	 	
              Page

            
	Section 1.01	General	 	
              1

            
	Article II THE
              CONTRIBUTION 	 	
              1

            
	Section 2.01	Intercorporate
              Reorganization	
              14

            
	Section 2.02	Financial Instruments	
              16

            
	Section 2.03	Intercompany Accounts and
              Arrangements	
              17

            
	Section 2.04	The CombiMatrix Board	
              18

            
	Section 2.05	Resignations, Transfer of
              Stock
              Held as Nominee	
              19

            
	Section 2.06	CombiMatrix Certificate
              of
              Incorporation and Bylaws	
              19

            
	Section 2.07	Consents	 	
              19

            
	Article III THE
              DISTRIBUTION	 	
              20

            
	Section 3.01	The Distribution	 	
              20

            
	Section 3.02	Fractional Shares	 	
              21

            
	Section 3.03	Cooperation Prior to the
              Distribution	
              21

            
	Section 3.04	Acacia Board Action Conditions
              to
              the Distribution	
              22

            
	Section 3.05	Waiver of Conditions	
              23

            
	Article IV MUTUAL RELEASE;
              INDEMNIFICATION; EXPENSES	
              23

            
	Section 4.01	Mutual Release	 	
              23

            
	Section 4.02	Indemnification by Acacia	
              24

            
	Section 4.03	Indemnification by
              CombiMatrix	
              24

            
	Section 4.04	Limitations on Indemnification
              Obligations	
              25

            
	Section 4.05	Procedures Relating to
              Indemnification	
              26

            
	Section 4.06	Remedies Cumulative	
              27

            
	Section 4.07	Indemnification Under Tax
              Allocation Agreement	
              28

            
	Section 4.08	Expenses	 	
              28

            
	Article V CERTAIN OTHER
              MATTERS	
              29

            
	Section 5.01	Insurance	 	
              29

            
	Section 5.02	Use of Names, Trademarks,
              etc.	
              31

            
	Section 5.03	CombiMatrix Warrants	
              32

            
	Article VI ACCESS TO
              INFORMATION	
               33

            
	Section 6.01	Provision of Corporate
              Records	
              33

            
	Section 6.02	Access to Information	
              33

            
	Section 6.03	Production of Witnesses	
              34

            
	Section 6.04	Retention of Records	
              34

            
	Section 6.05	Confidentiality	 	
              35

            
	Article VII MISCELLANEOUS	
              35

            
	Section 7.01	Entire Agreement;
              Construction	
              35

            
	Section 7.02	Survival of Agreements	
              36

            
	
              Section 7.03

            	Governing Law	 	
              36

            
	Section 7.04	Notices	 	
              36

            
	Section 7.05	Dispute Resolution	
              37

            
	Section 7.06	Consent to Jurisdiction	
              37

            
	Section 7.07	Amendments	 	
              38

            
	Section 7.08	Assignment	 	
              38

            
	Section 7.09	Captions; Currency	
              38

            
	Section 7.10	Severability	 	
              
                38

              

            
	Section 7.11	Parties in Interest	 	
              39

            
	Section 7.12	Schedules	 	
              39

            
	Section 7.13	Termination	 	
              39

            
	Section 7.14	Waivers; Remedies	
              39

            
	Section 7.15	Further Assurances	
              39

            
	Section 7.16	Counterparts	 	
              39

            
	Section 7.17	Performance	 	
              40

            
	Section 7.18	Interpretation	 	
              40

            
	 	 	 

    

    
       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    SCHEDULES

     

    

     

    
      	
              Schedule
                1.01(a)

               

            	 	
              Acacia
                Liabilities

               

            
	
              Schedule
                1.01(b)

               

            	
              -

               

            	
              Bylaws

               

            
	
              Schedule
                1.01(c)

               

            	
              -

               

            	
              Certificate
                of Incorporation

               

            
	
              Schedule
                1.01(d)

               

            	
              -

               

            	
              CombiMatrix
                Assets

               

            
	
              Schedule
                1.01(e)

               

            	
              -

               

            	
              CombiMatrix
                Liabilities

               

            
	
              Schedule
                1.01(f)

               

            	
              -

               

            	
              CombiMatrix
                Real Property

               

            
	
              Schedule
                1.01(g)

               

            	
              -

               

            	
              CombiMatrix
                Subsidiary

               

            
	
              Schedule
                2.01(c)

               

            	
              -

               

            	
              Acacia
                Actions

               

            
	
              Schedule
                2.03(a)

               

            	
              -

               

            	
              Elimination
                of Intercompany Agreements

               

            
	
              Schedule
                2.03(b)

               

            	
              -

               

            	
              Intercompany
                Agreements

               

            
	
              Schedule
                2.04

               

            	
              -

               

            	
              CombiMatrix
                Board of Directors

               

            
	
              Schedule
                2.05

               

            	
              -

               

            	
              Exceptions
                to Acacia Resignations

               

            
	
              Schedule
                5.03(a)

               

            	
              -

               

            	
              CombiMatrix/May
                2003 Warrant

               

            
	
              Schedule
                5.03(b)

               

            	
              -

               

            	
              CombiMatrix/Piper
                2005 Warrant

               

            
	
              Schedule
                5.03(c)

               

            	
              -

               

            	
              CombiMatrix/Oppenheimer
                Warrant

               

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    DISTRIBUTION
      AGREEMENT

     

    This
      Distribution Agreement
      (this
“Agreement”)
      is
      made and entered into as of December 21, 2006, by and between Acacia
      Research Corporation,
      a
      Delaware corporation (“Acacia”),
      and
CombiMatrix
      Corporation,
      a
      Delaware corporation and, as of the date hereof, a wholly-owned subsidiary
      of
      Acacia (“CombiMatrix”).
      Capitalized terms used in this Agreement shall have the meanings set forth
      in
      Section 1.01.

     

    RECITALS

     

    A.    The
      Acacia Board has determined that it is appropriate and desirable to distribute
      all outstanding shares of CombiMatrix Common Stock on a pro rata basis to the
      holders of CombiMatrix Tracking Stock.

     

    B.    Subject
      to the terms and conditions contained herein, immediately prior to the
      Distribution, Acacia and the Acacia Subsidiaries will transfer the CombiMatrix
      Subsidiaries to CombiMatrix as more fully described in this Agreement (the
      “Contribution”).

     

    C.    Acacia
      and CombiMatrix have determined that it is appropriate and desirable to set
      forth the principal corporate transactions required to effect the Contribution
      and the Distribution and certain other agreements that will govern certain
      matters relating to the Contribution and the Distribution and the relationship
      of Acacia, CombiMatrix and the respective members of the Acacia Group and the
      CombiMatrix Group following the Contribution and the Distribution.

     

    AGREEMENT

     

    Accordingly,
      in
      consideration of the premises and of the respective agreements and covenants
      contained in this Agreement, the parties hereby agree as follows:

     

    ARTICLE
      I

    DEFINITIONS

     

    Section
      1.01    General.
      As used
      in this Agreement, the following terms shall have the following meanings (such
      meanings to be equally applicable to both the singular and plural forms of
      the
      terms defined):

     

    “Acacia”
shall
      have the meaning set forth in the preamble.

     

    “Acacia
      Assets”
means
      the following:

     

    (a)    all
      rights of any member of the Acacia Group under any Separation Agreement to
      which
      it is or becomes a party;

     

    (b)    all
      Assets which are expressly allocated to any member of the Acacia Group pursuant
      to the Employee Matters Agreement or the Tax Allocation Agreement;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (c)    the
      following specifically enumerated Assets which immediately prior to the Time
      of
      Distribution are owned by Acacia or any of its Subsidiaries (including Persons
      comprising the CombiMatrix Group), in each case whether or not such Assets
      are
      used in or relate to the Acacia Business or the CombiMatrix
      Business:

     

    (i)    all
      Acacia Bank Accounts;

     

    (ii)   all
      Acacia Cash;

     

    (iii)   all
      Accounts Receivable other than CombiMatrix Accounts Receivable;

     

    (iv)   all
      Inventories other than CombiMatrix Inventories;

     

    (v)    all
      Securities;

     

    (vi)   all
      Machinery and Equipment other than CombiMatrix Machinery and
      Equipment;

     

    (vii)   all
      Real
      Property other than CombiMatrix Real Property;

     

    (viii)   all
      Patents and Trademarks other than those set forth on Schedule
      1.01(d);

     

    (ix)    
all
      rights in, and to the use of, the Acacia Marks, other than as provided for
      in
      Section 5.02;

     

    (x)     
      all
      Policies and all rights, benefits and privileges thereunder and related thereto
      (including the right to receive any and all return premiums with respect
      thereto), other than rights with respect to Policies to the extent provided
      in
      Sections 5.01(b) and 5.01(c); and

     

    (d)    all
      other
      Assets which immediately prior to the Time of Distribution are owned by Acacia
      or any of its Subsidiaries (including Persons comprising the CombiMatrix Group)
      that are not CombiMatrix Assets; and

     

    (e)    all
      rights, causes of action and claims of Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) to the extent relating
      to
      any asset described in clauses (a) through (d) above.

     

    Anything
      contained herein to the contrary notwithstanding, assets described in paragraphs
      (b) and (c) of the definition of “CombiMatrix Assets” will not be included in
      Acacia Assets.

     

    “Acacia
      Bank Accounts”
means
      all bank accounts of Acacia or any of its Subsidiaries (including Persons
      comprising the CombiMatrix Group) immediately prior to the Time of Distribution,
      other than CombiMatrix Bank Accounts.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    “Acacia
      Board”
means
      the Board of Directors of Acacia or a duly authorized committee
      thereof.

     

    “Acacia
      Business”
means
      (a) the businesses and operations engaged in prior to the Time of
      Distribution by Persons comprising the Pre-Distribution Group (but with respect
      to each such Person who has ceased to be an Affiliate of Acacia or its
      predecessors, only businesses engaged in prior to the time that such Person
      comprising the Pre-Distribution Group ceased to be an Affiliate of Acacia or
      its
      predecessors) of acquiring, developing, licensing and enforcing patents rights,
      including (i) assisting patent holders in developing additional claims for
      their patents, (ii) assisting patent holders in protecting their patented
      inventions from unauthorized use, and (iii) generating revenue from the
      licensing of patents and, if necessary, enforcing patents; and
      (b) activities related primarily to the foregoing, other than any
      businesses, operations or activities included in the CombiMatrix
      Business.

     

    “Acacia
      Cash”
means
      all (i) cash (including cash in bank accounts), cash on hand, cash equivalents,
      funds, certificates of deposit, similar instruments and travelers checks held
      by
      Acacia or any of its Subsidiaries and Affiliates (including Persons comprising
      the CombiMatrix Group) immediately prior to the Time of Distribution and (ii)
      cash deposits held by third parties securing or otherwise collateralizing
      obligations of Acacia or any of its Subsidiaries or Affiliates (including
      Persons comprising CombiMatrix Group) immediately prior to the Time of
      Distribution, other than, in the case of each of the foregoing clauses (i)
      and
      (ii), CombiMatrix Cash.

     

    “Acacia
      Expenses”
means
      all out-of-pocket fees, costs and expenses of Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) incurred prior to the
      Time
      of Distribution in connection with effecting the Contribution, the Distribution,
      the preparation, execution and delivery of the Separation Agreements and the
      consummation of the Contribution and the Distribution, other than CombiMatrix
      Expenses.

     

    “Acacia
      Group”
means
      Acacia and the Acacia Subsidiaries.

     

    “Acacia
      Indemnitees”
mean
      each member of the Acacia Group and each of their respective Representatives
      and
      Affiliates and each of the heirs, executors, successors and permitted assigns
      of
      any of the foregoing.

     

    “Acacia
      Liabilities”
means
      the following:

     

    (a)    all
      Liabilities of any member of the Acacia Group under any Separation Agreement
      to
      which it is or becomes a party;

     

    (b)    all
      Liabilities for which any member of the Acacia Group is expressly made
      responsible pursuant to the Employee Matters Agreement or the Tax Allocation
      Agreement;

     

    (c)    the
      specifically enumerated Liabilities of Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) identified on Schedule
      1.01(a), in each case whether or not such Liabilities relate to the Acacia
      Business, Acacia Assets, the CombiMatrix Business or CombiMatrix
      Assets:

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (d)    all
      other
      Liabilities of Acacia or any of its Subsidiaries (including Persons comprising
      the CombiMatrix Group) in respect of operations engaged in prior to the Time
      of
      Distribution that are not CombiMatrix Liabilities.

     

    Anything
      contained herein to the contrary notwithstanding, Liabilities described in
      paragraphs (b) and (c) of the definition of “CombiMatrix Liabilities” will not
      be included in Acacia Liabilities.

     

    “Acacia
      Marks”
means
      the names, trademarks, trade names, domain names and service marks “Acacia”,
“Acacia Research Corporation”, Digital Media Technology”, “Digital Media” and
“DMT” and all corporate symbols and logos related thereto and all names,
      trademarks, trade names, domain names and service marks which include the words
      “Acacia”, “Acacia Research Corporation”, “Digital Media Technology” and “DMT” or
      any derivatives thereof and any other name, mark or symbol of the Acacia Group,
      including, without limitation, names, marks or symbols connoting “Acacia” or
“DMT” which constitute a formative thereof.

     

    “Acacia
      Subsidiary”
means
      each Subsidiary of Acacia other than CombiMatrix and the CombiMatrix
      Subsidiaries.

     

    “Action”
means,
      with respect to any Person, any actual or threatened or future action, suit,
      arbitration, inquiry, proceeding or investigation by or before any Governmental
      Entity or any claims or other legal matters that have been or may be asserted
      by
      or against, or otherwise affect, such Person.

     

    “Affiliate”
means,
      with respect to any specified Person, any other Person that directly, or
      indirectly through one or more intermediaries, controls, is controlled by,
      or is
      under common control with, such specified Person; provided,
      however,
      that
      for purposes of the Separation Agreements, following the Time of Distribution,
      neither Acacia nor any Acacia Subsidiary shall be deemed to be an Affiliate
      of
      any member of the CombiMatrix Group and neither CombiMatrix nor any CombiMatrix
      Subsidiary shall be deemed to be an Affiliate of any member of the Acacia Group.
      For purposes of the immediately preceding sentence, the term “control”
(including, with correlative meanings, the terms “controlled by” and “under
      common control with”), as used with respect to any Person, means the possession,
      directly or indirectly, of the power to direct or cause the direction of the
      management and policies of such Person, whether through ownership of voting
      securities, by contract or otherwise.

     

    “Agreement”
shall
      have the meaning set forth in the preamble.

     

    “American
      Stock Exchange”
means
      the American Stock Exchange LLC.

     

    “Asset/Liability
      Allocation Matter”
shall
      have the meaning set forth in Section 2.01(b).

     

    “Assigning
      Party”
shall
      have the meaning set forth in Section 2.07.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    “Business
      Day”
means
      any day other than a Saturday, Sunday or other day when banks are authorized
      or
      required by law to be closed in California.

     

    “Bylaws”
means
      CombiMatrix’s amended Bylaws in the form attached hereto as Schedule
      1.01(b).

     

    “CBMX
      Tracking Stock”
means
      Acacia Research-CombiMatrix Common Stock, par value $0.001 per
      share.

     

    “Certificate
      of Incorporation”
means
      CombiMatrix’s restated certificate of incorporation in the form attached hereto
      as Schedule 1.01(c).

     

    “Claims
      Administration”
means
      the processing of claims made under Policies, including the reporting of claims
      to the insurance carrier, management and defense of claims, and providing for
      appropriate releases upon settlement of claims.

     

    “Claims
      Made Policies”
shall
      have the meaning set forth in Section 5.01(b)(ii).

     

    “Code”
means
      the Internal Revenue Code of 1986, as amended, or any successor
      legislation.

     

    “CombiMatrix”
shall
      have the meaning set forth in the preamble.

     

    “CombiMatrix
      Accounts Receivable”
mean
      the Accounts Receivable set forth on the CombiMatrix Accounting Ledgers
      immediately prior to the Time of Distribution.

     

    “CombiMatrix
      Assets”
means
      the following:

     

    (a)    all
      rights of any member of the CombiMatrix Group under any Separation Agreement
      to
      which it is or becomes a party;

     

    (b)    all
      Assets which are expressly allocated to any member of the CombiMatrix Group
      pursuant to the Employee Matters Agreement or the Tax Allocation
      Agreement;

     

    (c)    the
      following specifically enumerated Assets which immediately prior to the Time
      of
      Distribution are owned by Acacia or any of its Subsidiaries (including Persons
      comprising the CombiMatrix Group):

     

    (i)    the
      CombiMatrix Bank Accounts; 

     

    (ii)   the
      CombiMatrix Cash (subject to Section 2.04(b)); 

     

    (iii)   the
      CombiMatrix Accounts Receivable; 

     

    (iv)  
the
      CombiMatrix Inventories; 

     

    (v)    the
      CombiMatrix Machinery and Equipment; 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (vi)   the
      CombiMatrix Real Property;

     

    (vii)   the
      Patents and Trademarks set forth on Schedule 1.01(d); 

     

    (viii)   all
      assets identified in Schedule 1.01(d) as CombiMatrix’s; 

     

    (d)    the
      following Assets (other than those described in paragraphs (b) and (c) of the
      definition of “Acacia Assets”) which immediately prior to the Time of
      Distribution are owned by Acacia or any of its Subsidiaries (including Persons
      comprising the CombiMatrix Group) and which are used exclusively in or relate
      exclusively to the CombiMatrix Business, as the same shall exist as of such
      time:

     

    (i)    Contracts;

     

    (ii)   advances,
      performance and surety bonds, and interests as beneficiary under letters of
      credit and other similar instruments and all proceeds thereof;

     

    (iii)   Permits;

     

    (iv)   credits,
      prepayments and prepaid expenses;

     

    (v)    claims,
      causes of action, rights under express or implied warranties, guarantees and
      indemnities and similar rights, rights of recovery, rights of set-off, rights
      of
      subrogation and all other rights of any kind (including the right to receive
      mail and other communications); and

     

    (vi)   goodwill,
      going concern value and other intangible assets not otherwise included in
      clauses (a) through (q) of the definition of “Assets”;

     

    (e)    the
      following Assets (other than those described in paragraphs (b) and (c) of the
      definition of “Acacia Assets”) which immediately prior to the Time of
      Distribution are owned by Acacia or any of its Subsidiaries (including Persons
      comprising the CombiMatrix Group) and which are used 75% or more in or relate
      75% or more to the CombiMatrix Business, as the same shall exist as of such
      time:

     

    (i)    Data
      and
      Records; and

     

    (ii)   Trade
      Secrets; and

    
(f)    all
      rights, causes of action and claims of Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) to the extent relating
      to
      any asset described in clauses (a) through (e) above.

     

    Anything
      contained herein to the contrary notwithstanding, assets described in paragraphs
      (b) and (c) of the definition of “Acacia Assets” will not be included in
      CombiMatrix Assets.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    “CombiMatrix
      Bank Accounts”
means
      all bank accounts which are solely in the name of one or more members of the
      CombiMatrix Group immediately prior to the Time of Distribution.

     

    “CombiMatrix
      Board”
means
      the Board of Directors of CombiMatrix.

     

    “CombiMatrix
      Business”
means
      (a) the business and operations engaged in prior to the Time of
      Distribution by the members of the Pre-Distribution Group (but with respect
      to
      each such member who has ceased to be an Affiliate of Acacia or its
      predecessors, only businesses engaged in prior to the time that such member
      of
      the Pre-Distribution Group ceased to be an Affiliate of Acacia or its
      predecessors) of (i) developing and licensing products for use by academic
      and industrial researchers to develop various pharmaceutical, biotechnology
      and
      other applications and (ii) developing and licensing additional proprietary
      products that have, and can be used for, such diverse applications as drug
      target discovery and validations, genotyping, pathogen detection and/or
      agricultural analysis; and (b) activities related primarily to the
      foregoing.

     

    “CombiMatrix
      Cash”
means
      (i) the following to the extent set forth on the CombiMatrix Accounting
      Ledgers immediately prior to the Time of Distribution or located at Locations
      of
      the CombiMatrix Business at the Time of Distribution: cash in CombiMatrix Bank
      Accounts, cash on hand, cash equivalents, funds, certificates of deposits,
      similar instruments and travelers checks and (ii) cash deposits held by
      third parties securing or otherwise collateralizing obligations relating to
      the
      CombiMatrix Business immediately prior to the Time of Distribution.

     

    “CombiMatrix
      Common Stock”
means
      the common stock, par value $.00l per share, of CombiMatrix.

     

    “CombiMatrix
      Expenses”
means
      the following out-of-pocket fees, costs and expenses of Acacia or any of its
      Subsidiaries (including Persons comprising the CombiMatrix Group), in each
      case,
      whether incurred and/or paid before, at or after the Time of Distribution:
      all
      out-of-pocket fees, costs and expenses of the transfer agent and registrar
      for
      the CombiMatrix Common Stock.

     

    “CombiMatrix
      Financial Instruments”
means
      those credit facilities, guaranties, foreign currency forward exchange
      contracts, comfort letters, letters of credit and similar instruments related
      to
      the CombiMatrix Business under which any member of the Acacia Group has any
      primary, secondary, contingent, joint, several or other Liability.

     

    “CombiMatrix
      Group”
means
      CombiMatrix and the CombiMatrix Subsidiaries.

     

    “CombiMatrix
      Indemnitees”
means
      each member of the CombiMatrix Group and each of their respective
      Representatives and Affiliates and each of the heirs, executors, successors
      and
      permitted assigns of any of the foregoing.

     

    “CombiMatrix
      Inventories”
means
      the Inventories set forth on the CombiMatrix Accounting Ledgers immediately
      prior to Time of Distribution.

     

    “CombiMatrix
      Liabilities”
means
      the following:

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (a)    all
      Liabilities of any Person comprising the CombiMatrix Group under any Separation
      Agreement to which it is or becomes a party;

     

    (b)    all
      Liabilities for which any Person comprising the CombiMatrix Group is expressly
      made responsible pursuant to the Employee Matters Agreement or the Tax
      Allocation Agreement;

     

    (c)    the
      specifically enumerated Liabilities of CombiMatrix or any of its Subsidiaries
      set forth on Schedule 1.01(e), in each case whether or not such Liabilities
      relate to the Acacia Business, Acacia Assets, the CombiMatrix Business or
      CombiMatrix Assets; and

     

    (d)    all
      Liabilities (other than those described in paragraphs (b) and (c) of the
      definition of “Acacia Liabilities”) of Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) to the extent based upon,
      arising out of or relating to the CombiMatrix Assets or the CombiMatrix
      Business, including:

     

    (i)    all
      Liabilities (including Liabilities arising out of any breaches or violations)
      to
      the extent relating to the CombiMatrix’s Business based upon, arising out of or
      relating to Contracts (whether or not such Contracts constitute CombiMatrix
      Assets) (including any primary, secondary, contingent or other obligations,
      such
      as under guaranties or indemnities, in respect of such Contracts); and

     

    (ii)   the
      Actions set forth on Schedule 1.01(e).

     

    Anything
      contained herein to the contrary notwithstanding, Liabilities described in
      paragraphs (b) and (c) of the definition of “Acacia Liabilities” will not be
      included in CombiMatrix Liabilities.

     

    “CombiMatrix
      Machinery and Equipment”
means
      the Machinery and Equipment set forth on the CombiMatrix Accounting Ledgers
      immediately prior to the Time of Distribution.

     

    “CombiMatrix
      Real Property”
means
      the Real Property set forth on Schedule 1.01(f)

     

    “CombiMatrix
      Subsidiary”
means
      each Person listed on Schedule 1.01(g).

     

    “CombiMatrix/May
      2003 Warrant”
shall
      have the meaning set forth in Section 5.03(a).

     

    “CombiMatrix/Piper
      2005 Warrant”
shall
      have the meaning set forth in Section 5.03(b).

     

    “CombiMatrix/Oppenheimer
      Warrant”
shall
      have the meaning set forth in Section 5.03(c).

     

    “Commission”
means
      the Securities and Exchange Commission.

     

    “Consents”
means
      consents, approvals, waivers, clearances, exemptions, allowances, novations,
      authorizations, filings, registrations and notifications.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    “Contracts”
means
      all agreements, personal property leases, contracts (including employee
      contracts), licenses, memoranda of understanding, letters of intent, sales
      orders, purchase orders, open bids and other commitments, including in each
      case, all amendments, modifications and supplements thereto and waivers and
      consents thereunder, but excluding real property leases.

     

    “Contribution”
shall
      have the meaning set forth in the recitals.

     

    “Conveyance
      Instruments”
means,
      collectively, the various agreements, stock powers, certificates of title,
      instruments of conveyance and assignment, and other instruments and documents
      to
      be entered into to effect the transfer of Subsidiaries contemplated by the
      transactions described in Sections 2.01(b) and (c).

     

    “Data
      and Records”
means
      financial, accounting, corporate, operating, design, manufacturing, test and
      other data and records (in each case, in whatever form or medium, including
      electronic media), including books, records, notes, sales and sales promotional
      material and data, advertising materials, credit information, cost and pricing
      information, customer, supplier and agent lists, other records pertaining to
      customers, business plans, reference catalogs, payroll and personnel records
      and
      procedures, blue-prints, research and development files, data and laboratory
      books, sales order files, litigation files, minute books, stock ledgers, stock
      transfer records and other similar data and records.

     

    “Dispute”
shall
      have the meaning set forth in Section 7.05.

     

    “Distribution”
means
      the distribution, on the basis provided for in Section 3.01, to the holders
      of
      CBMX Tracking Stock of the shares of CombiMatrix Common Stock owned by Acacia
      on
      the Distribution Date.

     

    “Distribution
      Agent”
means
      the distribution agent selected by Acacia to distribute CombiMatrix Common
      Stock
      in connection with the Distribution.

     

    “Distribution
      Date”
means
      the date determined by the Acacia Board in accordance with Section 3.01 as
      the
      date as of which the Distribution will be effected.

     

    “Employee
      Matters Agreement”
means
      the Employee Matters Agreement dated as of the date hereof entered into prior
      to
      the Time of Distribution by and between Acacia and CombiMatrix.

     

    “Former
      Business”
means
      any corporation, partnership, entity, division, business unit, business, assets,
      plants, product line, operations or contract (including any assets and
      liabilities comprising the same) that has been sold, conveyed, assigned,
      transferred or otherwise disposed of or divested (in whole or in part) by any
      member of the Pre-Distribution Group or the operations, activities or production
      of which has been discontinued, abandoned, completed or otherwise terminated
      (in
      whole or in part) by any member of the Pre-Distribution Group.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    “Governmental
      Entity”
means
      any government or any court, arbitral tribunal, administrative agency or
      commission or other governmental or regulatory authority or agency, federal,
      state, local, domestic, foreign or international.

     

    “Group”
means
      the Acacia Group or the CombiMatrix Group, as applicable.

     

    “Indemnifiable
      Losses”
means
      any and all losses, Liabilities, claims, damages, deficiencies, obligations,
      fines, payments, Taxes, Liens, costs and expenses, matured or unmatured,
      absolute or contingent, accrued or unaccrued, liquidated or unliquidated, known
      or unknown, whenever arising and whether or not resulting from Third Party
      Claims (including the costs and expenses of any and all Actions; all amounts
      paid in connection with any demands, assessments, judgments, settlements and
      compromises relating thereto; interest and penalties with respect thereto;
      out-of-pocket expenses and reasonable attorneys’, accountants’ and other
      experts’ fees and expenses reasonably incurred in investigating, preparing for
      or defending against any such Actions or in asserting, preserving or enforcing
      an Indemnitee’s rights hereunder; and any losses that may result from the
      granting of injunctive relief as a result of any such Actions).

     

    “Indemnifying
      Party”
shall
      have the meaning set forth in Section 4.04(a).

     

    “Indemnitee”
means
      any of the Acacia Indemnitees or the CombiMatrix Indemnitees who or which is
      entitled to seek indemnification under this Agreement.

     

    “Indemnity
      Reduction Amounts”
shall
      have the meaning set forth in Section 4.04(a).

     

    “Information”
means
      all records, books, contracts, instruments, computer data and other data and
      information (in each case, in whatever form or medium, including electronic
      media).

     

    “Insurance
      Proceeds”
means
      monies (a) received by an insured from an insurance carrier, (b) paid by an
      insurance carrier on behalf of an insured or (c) received from any third party
      in the nature of insurance, contribution or indemnification in respect of any
      Liability.

     

    “Liabilities”
means
      any and all claims, debts, liabilities, commitments and obligations of whatever
      nature, whether fixed, contingent or absolute, matured or unmatured, liquidated
      or unliquidated, accrued or not accrued, known or unknown, due or to become
      due,
      whenever or however arising and whether or not the same would be required by
      generally accepted accounting principles to be reflected as a liability in
      financial statements or disclosed in the notes thereto, including all costs
      and
      expenses relating thereto and those claims, debts, liabilities, commitments
      and
      obligations:

     

    (a)    based
      upon, arising out of or relating to any law, statute, rule, regulation,
      judgment, order, decision or consent decree of any Governmental Entity or any
      noncompliance therewith or breach or violation of any thereof;

     

    (b)    in
      respect of
      accounts payable;

     

    (c)    in
      respect of outstanding checks;

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (d)    based
      upon, arising out of or relating to workers’ compensation, automobile liability,
      general liability, product liability, intellectual property liability and other
      claims and matters (whether direct or for indemnification of any Person or
      otherwise, and whether insured or uninsured);

     

    (e)    based
      upon, arising out of or relating to Actions or any award of any arbitrator
      of
      any kind;

     

    (f)    in
      respect of salary, bonuses, incentive payments, severance payments and other
      compensation payments and all Taxes and withholdings related
      thereto;

     

    (g)    in
      respect of employee welfare and fringe benefits (including claims for medical
      and disability benefits);

     

    (h)    based
      upon, arising out of or relating to environmental matters (including the
      presence, release or threatened release of hazardous materials or any other
      environmental conditions or the violation of any environmental laws), including
      all removal, remediation and cleanup costs, investigatory costs, settlement
      costs, governmental response costs, natural resources damages, property damages,
      personal injury damages and all other costs and damages;

     

    (i)    based
      upon, arising out of or relating to Contracts;

     

    (j)    based
      upon, arising out of or relating to torts (whether based on negligence, strict
      liability or otherwise) or infringements; and

     

    (k)    in
      respect of products and services, including warranty liabilities, deferred
      revenues, product liability claims and liabilities in respect of the return,
      repair or replacement of products.

     

    “Liability
      Allocation Matter”
shall
      have the meaning set forth in Section 2.01(b).

     

    “Lien”
means
      any lien, security interest, pledge, mortgage, charge, restriction, retention
      of
      title agreement or other encumbrance of whatever nature.

     

    “Machinery
      and Equipment”
means
      machinery, equipment, tooling, vehicles, furniture and fixtures (other than
      real
      property fixtures), leasehold improvements, repair parts, tools, plant,
      laboratory and office equipment and supplies, computer hardware and software,
      computer networking equipment, engineering and design equipment, test equipment
      and other tangible personal property (other than tangible personal property
      included in other categories of assets in the definition of “Assets”), together
      with any rights or claims arising out of maintenance or service contracts
      relating thereto or the breach of any express or implied warranty by the
      manufacturers or sellers of any of such assets or any component part
      thereof.

     

    “Occurrence
      Basis Policies”
shall
      have the meaning set forth in Section 5.01(b)(i).

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    “Oppenheimer
      Warrant”
means
      any warrant issued in Acacia’s registered direct offering in December 2006 in
      which Oppenheimer & Co. Inc. acted as the placement agent.

     

    “Permits”
means
      licenses, permits, authorizations, Consents, certificates, registrations,
      variances, franchises and other approvals from any Governmental Entity,
      including those relating to environmental matters.

     

    “Person”
means
      any individual, partnership, joint venture, corporation, limited liability
      entity, trust, unincorporated organization or other entity (including a
      Governmental Entity).

     

    “May
      2003 Warrant”
means
      any warrant issued in Acacia’s May 2003 private placement
      transaction.

     

    “Piper
      2005 Warrant”
means
      any warrant issued in Acacia’s registered direct offering in September 2005 in
      which Piper Jaffrey & Co. acted as the placement agent.

     

    “Policies”
means
      all insurance policies, insurance contracts and claim administration contracts
      of any kind of Acacia and its Subsidiaries (including Persons comprising the
      CombiMatrix Group) and their predecessors which were or are in effect at any
      time at or prior to the Time of Distribution (other than insurance policies,
      insurance contracts and claim administration contracts established in
      contemplation of the Distribution to cover only CombiMatrix and its Subsidiaries
      after the Time of Distribution), including primary, excess and umbrella,
      commercial general liability, fiduciary liability, product liability,
      automobile, aircraft, property and casualty, business interruption, directors
      and officers liability, employment practices liability, workers’ compensation,
      crime, errors and omissions, special accident, cargo and employee dishonesty
      insurance policies and captive insurance company arrangements, together with
      all
      rights, benefits and privileges thereunder.

     

    “Pre-Distribution
      Group”
means
      (a) each of Acacia, the Subsidiaries of Acacia existing immediately prior to
      the
      Time of Distribution (including Persons comprising the CombiMatrix Group) and
      Persons that have ceased to be Subsidiaries of Acacia prior to the Time of
      Distribution, (b) each of the predecessors of each of the foregoing and
      (c) each of the Persons that have ceased to be Subsidiaries and other
      Affiliates of each of the foregoing and their predecessors prior to the Time
      of
      Distribution.

     

    “Privileged
      Information”
means,
      with respect to a Group, Information regarding a member of such Group, or any
      of
      its operations, employees, assets or Liabilities (whether in documents or stored
      in any other form or known to its employees or agents) that is or may be
      protected from disclosure pursuant to the attorney-client privilege, the work
      product doctrine or other applicable privileges, that a member of the other
      Group has or may come into possession of or has obtained or may obtain access
      to
      pursuant to this Agreement or otherwise.

     

    “Real
      Property”
means
      real property (including land, plants, buildings, real property fixtures and
      improvements) and real property interests (including real property leases,
      easements and rights of way, occupancy or use).

     

    “Recipient
      Party”
shall
      have the meaning set forth in Section 2.08.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    “Record
      Date”
means
      the close of business on the forty-fifth (45th)
      Trading
      Day following the effective date of the Registration Statement.

     

    “Representative”
means,
      with respect to any Person, any of such Person’s directors, officers, employees,
      agents, consultants, advisors, accountants, attorneys and
      representatives.

     

    “Registration
      Statement”
means
      the registration statement on Form S-1 filed by CombiMatrix with the Commission
      to effect the registration of the CombiMatrix Common Stock pursuant to the
      Securities Act, including all amendments thereto filed by CombiMatrix with
      the
      Commission prior to the Time of Distribution.

     

    “Securities”
means
      all short-term and long-term investments, banker’s acceptances, shares of stock,
      notes, bonds, debentures, evidences of indebtedness, certificates of interest
      or
      participation in profit-sharing agreements, collateral-trust certificates,
      preorganization certificates or subscriptions, transferable shares, puts, calls,
      straddles, options, investment contracts, voting trusts and certificates and
      other securities of any kind (other than ownership interests in
      Subsidiaries).

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended.

     

    “Separation
      Agreements”
means,
      collectively, this Agreement, the Employee Matters Agreement, the Tax Allocation
      Agreement, the Conveyance Instruments, and any other agreement entered into
      between Acacia and CombiMatrix in connection with the Contribution and the
      Distribution.

     

    “Subsidiary”
means,
      with respect to any Person, any corporation or other organization, whether
      incorporated or unincorporated, of which such Person or any Subsidiaries of
      such
      Person controls or owns, directly or indirectly, more than 50% of the stock
      or
      other equity interest, or more than 50% of the voting power entitled to vote
      on
      the election of members to the board of directors or similar governing body.
      Notwithstanding the foregoing, the term “Subsidiary” shall also mean, with
      respect to CombiMatrix, the following entities: (i) Leuchemix, a California
      corporation, and (ii) CombiMatrix K.K., a Japanese corporation. 

     

    “Tax”
and
      “Taxes”
shall
      have the meaning set forth in the Tax Allocation Agreement.

     

    “Tax
      Allocation Agreement”
means
      the Tax Allocation Agreement dated as of the date hereof entered into prior
      to
      the Time of Distribution by and between Acacia and CombiMatrix.

     

    “Third
      Party Claim”
shall
      have the meaning set forth in Section 4.05(a).

     

    “Time
      of Distribution”
means
      the close of business on the Distribution Date.

     

    “Trade
      Secrets”
means
      (a) trade secrets and confidential business and technical information (including
      ideas, research and development, know-how, formulas, technology, compositions,
      manufacturing and production processes and techniques, technical data,
      engineering, production and other designs, drawings, engineering notebooks,
      industrial models, mask works, semiconductor chip topographies, software and
      specifications and any other information meeting the definition of a trade
      secret under the Uniform Trade Secrets Act); (b) computer and electronic data
      processing programs and software, both source code and object code (including
      data and related documentation, flow charts, diagrams, descriptive texts and
      programs, computer print-outs, underlying tapes, computer databases and similar
      items), computer applications and operating programs; and (c) all copies and
      tangible embodiments of any or all of the foregoing (in whatever form or medium,
      including electronic media).

     

    
      
        
        

      

      
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    “Trading
      Day”
shall
      have the meaning as set forth in Acacia’s Amended and Restated Certificate of
      Incorporation.

     

    ARTICLE
      II

    THE
      CONTRIBUTION

     

    Section
      2.01    Intercorporate
      Reorganization.
      

     

    (a)    Prior
      to
      the Time of Distribution, Acacia and CombiMatrix will take all actions necessary
      to increase the outstanding shares of CombiMatrix Common Stock so that,
      immediately prior to the Distribution, Acacia will hold a number of shares
      of
      CombiMatrix Common Stock (rounded down to the nearest whole share) equal to
      the
      aggregate number of shares of CombiMatrix Tracking Stock (excluding treasury
      shares held by Acacia) issued and outstanding as of the Record
      Date.

     

    (b)    As
      of the
      Time of
      Distribution

     

    (i)    Acacia
      and each Acacia Subsidiary shall convey, assign and transfer, or cause to be
      conveyed, assigned and transferred, to CombiMatrix any and all right, title
      and
      interest of Acacia and each of the Acacia Subsidiaries in the CombiMatrix
      Subsidiaries;

     

    (ii)   CombiMatrix
      and the CombiMatrix Subsidiaries shall not have any right, title or interest
      in
      or to any Acacia Subsidiary or Acacia Asset;

     

    (iii)   Acacia
      shall unconditionally assume and undertake to pay, perform and discharge, in
      a
      timely manner and in accordance with the terms thereof, all Liabilities of
      CombiMatrix and the CombiMatrix Subsidiaries that are Acacia Liabilities;
      and

     

    (iv)    CombiMatrix
      shall unconditionally assume and undertake to pay, perform and discharge, in
      a
      timely manner and in accordance with the terms thereof, all Liabilities of
      Acacia and the Acacia Subsidiaries that are CombiMatrix
      Liabilities.

     

    If
      at any
      time or from time to time (whether at or after the Time of Distribution) any
      member of the Acacia Group shall receive or otherwise possess any CombiMatrix
      Asset or interest in a CombiMatrix Subsidiary, such member will promptly convey,
      assign and transfer, or cause to be conveyed, assigned and transferred, such
      CombiMatrix Asset or interest in a CombiMatrix Subsidiary to CombiMatrix. If
      at
      any time or from time to time (whether at or after the Time of Distribution)
      any
      member of the CombiMatrix Group shall receive or otherwise possess any Acacia
      Asset or interest in an Acacia Subsidiary, such member will promptly convey,
      assign and transfer, or cause to be conveyed, assigned and transferred, such
      Acacia Asset or interest in an Acacia Subsidiary to Acacia. Prior to any such
      transfer, the Person receiving or possessing such Asset or interest in a
      Subsidiary will hold such Asset or interest in a Subsidiary in trust for the
      benefit of the Person entitled thereto (at the expense of the Person entitled
      thereto).

     

    
      
        
        

      

      
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    If
      at any
      time or from time to time (whether at or after the Time of Distribution) either
      Acacia or CombiMatrix determines that the other party (or any member of such
      other party’s respective Group) shall not have unconditionally assumed any
      Liabilities that are allocated to such other party (or a member of such other
      party’s respective Group) pursuant to this Agreement, the Employee Matters
      Agreement or the Tax Allocation Agreement, such other party will promptly
      execute and deliver, or cause to be executed and delivered, all such documents
      and instruments and will take, or cause to be taken, all such actions as the
      requesting party may reasonably request to unconditionally assume, or cause
      to
      be unconditionally assumed, such Liabilities.

     

    Solely
      for purposes of implementing the terms of this Agreement, during the period
      beginning on the date of this Agreement and ending twelve months after the
      Distribution Date, Acacia and CombiMatrix agree to discuss the allocation of
      any
      Asset or Liability of Acacia and its Subsidiaries (including Persons comprising
      the CombiMatrix Group) that either of them reasonably believes should be or
      should have been allocated differently than pursuant to the terms of this
      Agreement (an “Asset/Liability
      Allocation Matter”).
      The
      Acacia Chief Executive Officer will designate an employee of Acacia and the
      CombiMatrix Chief Executive Officer will designate an employee of CombiMatrix
      who will discuss an appropriate resolution of any Asset/Liability Allocation
      Matter. If within thirty days of the receipt of the notification of an
      Asset/Liability Allocation Matter by either Acacia or CombiMatrix pursuant
      to
      this paragraph, or such other time as Acacia and CombiMatrix may agree, the
      designees have not reached a mutually acceptable resolution of the
      Asset/Liability Allocation Matter, the matter will be referred for discussion
      to
      the Acacia Chief Executive Officer and the CombiMatrix Chief Executive Officer.
      Should a mutually acceptable resolution of the Asset/Liability Allocation Matter
      not be reached within thirty days following the referral to them, the terms
      and
      conditions of this Agreement shall remain in full force and effect, unamended,
      unmodified and unsupplemented. In no event shall the terms and conditions of
      this Agreement be amended, modified or supplemented other than in accordance
      with the provisions of Section 7.07. Nothing in this paragraph shall affect
      the
      right of any party to resort to the dispute resolution provisions of Section
      7.05 in respect of any dispute, claim or controversy arising out of an alleged
      breach of any provision of this Agreement.

     

    (c)    Acacia
      will take, or cause to be taken, the actions described on Schedule 2.01(c)
      in connection with the operation of the Acacia Business.

     

    (d)    In
      connection with the transfers of Subsidiaries and the assumptions of Liabilities
      contemplated by subsections (b) and (c) of this Section 2.01, Acacia
      and CombiMatrix will execute or cause to be executed by the appropriate entities
      the Conveyance Instruments. The transfer of capital stock contemplated by such
      subsections will be effected by means of delivery of stock certificates duly
      endorsed or accompanied by duly executed stock powers and notation on the stock
      record books of the corporation or other legal entities involved and, to the
      extent required by applicable law, by notation on appropriate
      registries.

     

    
      
        
        

      

      
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    (e)    Each
      of
      Acacia (on behalf of itself and each other member of the Acacia Group) and
      CombiMatrix (on behalf of itself and each other member of the CombiMatrix Group)
      understands and agrees that, except as expressly set forth in any Separation
      Agreement or any other agreement or document contemplated by any Separation
      Agreement, no party to any Separation Agreement, or any other agreement or
      document contemplated by any Separation Agreement either has or is, in such
      agreement or otherwise, representing or warranting in any way as to Assets,
      Subsidiaries, businesses or Liabilities retained, conveyed, assigned,
      transferred or assumed as contemplated hereby or thereby, as to any consents
      or
      approvals required in connection with the transactions contemplated by the
      Separation Agreements, as to the value or freedom from any Lien of, or any
      other
      matter concerning any Assets, Liabilities or Subsidiaries of, such party, or
      as
      to the absence of any defenses or rights of setoff or freedom from counterclaim
      with respect to any claim or other Assets or Subsidiaries of any party, or
      as to
      the legal sufficiency of any assignment, document or instrument delivered
      hereunder or thereunder to convey title to any Asset or Subsidiary or thing
      of
      value upon the execution, delivery or filing thereof. Except as may expressly
      be
      set forth in any Separation Agreement, all Assets and Subsidiaries being
      transferred or retained as contemplated by any Separation Agreement are being
      transferred, or are being retained, on an “as is”, “where is” basis and the
      respective transferees shall bear the economic and legal risks that any
      conveyance shall prove to be insufficient or that the title to any Asset or
      Subsidiary shall be other than good and marketable and free and clear of any
      Lien.

     

    (f)    It
      is the
      intention of the parties that payments made by the parties to each other after
      the Time of Distribution pursuant to this Agreement, the Employee Matters
      Agreement or the Tax Allocation Agreement are to be treated as relating back
      to
      the transactions occurring prior to the Time of Distribution pursuant to this
      Section 2.01 as an adjustment to the transfers of Assets, Subsidiaries and
      Liabilities contemplated by this Section 2.01, and Acacia and CombiMatrix
      will, and will cause the Acacia Subsidiaries and the CombiMatrix Subsidiaries,
      respectively, to, take positions consistent with such intention with any Tax
      authority, unless with respect to any payment any party receives an opinion
      of
      counsel reasonably acceptable to the other party to the effect that there is
      no
      substantial authority for such a position.

     

    Section
      2.02    Financial
      Instruments.

     

    (a)    CombiMatrix
      will (from and after the Time of Distribution, at its expense) take or cause
      to
      be taken all actions, and enter into (or cause the CombiMatrix Subsidiaries
      to
      enter into) such agreements and arrangements, as shall be necessary to effect
      the release of and substitution for each member of the Acacia Group, effective
      as of the Time of Distribution, from all primary, secondary, contingent, joint,
      several and other Liabilities in respect of CombiMatrix Financial Instruments
      (it being understood that all Liabilities in respect of CombiMatrix Financial
      Instruments are CombiMatrix Liabilities).

     

    
      
        
        

      

      
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    (b)    CombiMatrix’s
      obligations under Section 2.02(a) will continue to be applicable to all
      CombiMatrix Financial Instruments identified at any time by Acacia, whether
      before, at or after the Time of Distribution.

     

    Section
      2.03    Intercompany
      Accounts and Arrangements.
      

     

    (a)    Elimination
      of Intercompany Accounts.
      

     

    (i)    Except
      as
      set forth in Section 2.03(a)(ii) or on Schedule 2.03(a), Acacia, on behalf
      of
      itself and each other member of the Acacia Group, on the one hand, and
      CombiMatrix, on behalf of itself and each other member of the CombiMatrix Group,
      on the other hand, hereby settle and eliminate, by cancellation or transfer
      to a
      member of the other Group (whether to cancel or transfer and the manner thereof
      will be determined by Acacia), effective as of the Time of Distribution, all
      intercompany receivables, payables and other balances (including intercompany
      cash management balances) existing immediately prior to the Time of Distribution
      between Acacia and/or any Acacia Subsidiary, on the one hand, and CombiMatrix
      and/or any CombiMatrix Subsidiary, on the other hand.

     

    (ii)    The
      provisions of Section 2.03(a)(i) will not apply to any intercompany receivables,
      payables and other balances arising under any Separation Agreement, including
      those arising under Section 2.04 or incurred in connection with the payment
      by
      any party of any expenses which are required to be paid or reimbursed by the
      other party pursuant to Section 4.08.

     

    (b)    Intercompany
      Agreements.
      

     

    (i)    Except
      as
      set forth in Section 2.03(b)(ii), in furtherance of the releases and other
      provisions of Section 4.01, CombiMatrix, on behalf of itself and each other
      member of the CombiMatrix Group, and Acacia, on behalf of itself and each other
      member of the Acacia Group, hereby terminate any and all agreements,
      arrangements, commitments or understandings in existence as of the Time of
      Distribution, whether or not in writing, between or among CombiMatrix and/or
      any
      CombiMatrix Subsidiary, on the one hand, and Acacia and/or any Acacia
      Subsidiary, on the other hand. No such terminated agreement, arrangement,
      commitment or understanding (including any provision thereof which purports
      to
      survive termination) shall be of any further force or effect after the Time
      of
      Distribution.

     

    (ii)   The
      provisions of Section 2.03(b)(i) will not apply to any of the following
      agreements, arrangements, commitments or understandings (or to any of the
      provisions thereof): (A) the Separation Agreements and each other
      agreement, instrument or document expressly contemplated by any Separation
      Agreement to be entered into by any party hereto or any of the members of their
      respective Groups; (B) any agreements, arrangements, commitments or
      understandings listed or described on Schedule 2.03(b); (C) any agreements,
      arrangements, commitments or understandings to which any Person other than
      the
      parties hereto and their respective Affiliates is a party; and (D) any
      other agreements, arrangements, commitments or understandings that any
      Separation Agreement expressly contemplates will survive the Time of
      Distribution.

     

    
      
        
        

      

      
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    (c)    Funding
      of Outstanding Checks.
      

     

    (i)    CombiMatrix
      or a CombiMatrix Subsidiary will fund all amounts in respect of checks that
      are
      outstanding immediately prior to the Time of Distribution and presented for
      payment at or after the Time of Distribution in CombiMatrix Bank
      Accounts.

     

    (ii)   Acacia
      or
      an Acacia Subsidiary will fund all amounts in respect of checks that are
      outstanding immediately prior to the Time of Distribution and presented for
      payment at or after the Time of Distribution in Acacia Bank
      Accounts.

     

    (iii)   The
      provisions of this Section 2.04(c) with respect to funding of outstanding checks
      will not affect in any way, and will be subject to, all other provisions of
      this
      Agreement providing for the reimbursement of any amounts or the allocation
      of
      any Liabilities, including Section 4.08.

     

    (d)    Payments.
      

     

    (i)    CombiMatrix
      will, and will cause the CombiMatrix Subsidiaries to, forward to Acacia (for
      the
      account of Acacia or the applicable Acacia Subsidiary) any payments in respect
      of accounts receivable constituting Acacia Assets received by CombiMatrix or
      any
      of the CombiMatrix Subsidiaries after the Time of Distribution, whether received
      in lock boxes, via wire transfer or otherwise, by the first Business Day of
      the
      week after the week during which such payment is received. Such amounts will
      be
      forwarded by wire transfer (to an Acacia’s bank account designated in writing by
      Acacia) in the case of payments received within thirty days after the Time
      of
      Distribution and by check in the case of payments received
      thereafter.

     

    (ii)    Acacia
      will, and will cause the Acacia Subsidiaries to, forward to CombiMatrix (for
      the
      account of CombiMatrix or the applicable CombiMatrix Subsidiary) any payments
      in
      respect of accounts receivable constituting CombiMatrix Assets received by
      Acacia or any of the Acacia Subsidiaries after the Time of Distribution, whether
      received in lock boxes, via wire transfer or otherwise, by the first business
      day of the week after the week during which such payment is received. Such
      amounts will be forwarded by wire transfer (to a CombiMatrix’s bank account
      designated in writing by CombiMatrix) in the case of payments received within
      thirty days after the Time of Distribution and by check in the case of payments
      received thereafter.

     

    Section
      2.04    The
      CombiMatrix Board.
      Prior
      to the Time of Distribution, CombiMatrix and Acacia will take all actions which
      may be required to elect or otherwise appoint as directors of CombiMatrix the
      persons named on Schedule 2.04 to constitute the board of directors of
      CombiMatrix at the Time of Distribution.

     

    
      
        
        

      

      
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    Section
      2.05    Resignations,
      Transfer of Stock Held as Nominee.

     

    (a)    Acacia
      will cause all of its employees and directors and all of the employees and
      directors of each other member of the Acacia Group to resign, effective not
      later than the Time of Distribution, from all boards of directors or similar
      governing bodies of CombiMatrix or any other member of the CombiMatrix Group
      on
      which they serve, and from all positions as officers of CombiMatrix or any
      other
      member of the CombiMatrix Group in which they serve, except as otherwise
      specified on Schedule 2.05. CombiMatrix will cause all of its employees and
      directors and all of the employees and directors of each other member of the
      CombiMatrix Group to resign, effective not later than the Time of Distribution,
      from all boards of directors or similar governing bodies of Acacia or any other
      member of the Acacia Group on which they serve, and from all positions as
      officers of Acacia or any other member of the Acacia Group in which they serve,
      except as otherwise specified on Schedule 2.05.

     

    (b)    Acacia
      will cause each of its employees, and each of the employees of the other members
      of the Acacia Group, who holds stock or similar evidence of ownership of any
      CombiMatrix Group entity as nominee for such entity pursuant to the laws of
      the
      country in which such entity is located to transfer such stock or similar
      evidence of ownership to the Person so designated by CombiMatrix to be such
      nominee as of and after the Time of Distribution. CombiMatrix will cause each
      of
      its employees, and each of the employees of the other members of the CombiMatrix
      Group, who holds stock or similar evidence of ownership of any Acacia Group
      entity as nominee for such entity pursuant to the laws of the country in which
      such entity is located to transfer such stock or similar evidence of ownership
      to the Person so designated by Acacia to be such nominee as of and after the
      Time of Distribution.

     

    (c)    Acacia
      will cause each of its employees and each of the employees of the other members
      of the Acacia Group to revoke or withdraw their express written authority,
      if
      any, to act on behalf of any CombiMatrix Group entity as an agent or
      representative therefor after the Time of Distribution. CombiMatrix will cause
      each of its employees and each of the employees of the other members of the
      CombiMatrix Group to revoke or withdraw their express written authority, if
      any,
      to act on behalf of any Acacia Group entity as an agent or representative
      therefor after the Time of Distribution.

     

    Section
      2.06    CombiMatrix
      Certificate of Incorporation and Bylaws.
      Prior
      to the Time of Distribution, (a) the CombiMatrix Board will
      (i) approve the Certificate of Incorporation and will cause the same to be
      filed with the Secretary of State of the State of Delaware and (ii) adopt
      the Bylaws, and (b) Acacia, as sole shareholder of CombiMatrix, will
      approve the Certificate of Incorporation.

     

    Section
      2.07    Consents.
      Prior
      to and after the Distribution Date, Acacia and CombiMatrix will, and will cause
      the Acacia Subsidiaries and the CombiMatrix Subsidiaries, respectively, to,
      use
      their commercially reasonable efforts (as requested by the other party) to
      obtain, or to cause to be obtained, all Consents necessary for the transfer
      of
      all Assets, Subsidiaries and Liabilities contemplated to be transferred pursuant
      to this Article II; provided,
      however,
      that
      none of Acacia (or any of the Acacia Subsidiaries) or CombiMatrix (or any of
      the
      CombiMatrix Subsidiaries) shall be obligated to pay any consideration or offer
      or grant any financial accommodation in connection therewith. Anything contained
      herein to the contrary notwithstanding, this Agreement shall not constitute
      an
      agreement to assign any Contract or Permit if an assignment or attempted
      assignment of the same without the Consent of any other party or parties thereto
      or other required Consent would constitute a breach thereof or of any applicable
      law or in any way impair the rights of any member of the Acacia Group or the
      CombiMatrix Group thereunder. If any such Consent is not obtained or if an
      attempted assignment would be ineffective or would impair any rights of any
      member of either

     

    
      
        
        

      

      
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    Group
      under any such Contract or Permit so that the contemplated assignee hereunder
      (the “Recipient
      Party”)
      would
      not receive all such rights, then after the Time of Distribution (x) the party
      contemplated hereunder to assign such Contract or Permit (the “Assigning
      Party”)
      will
      use commercially reasonable efforts (it being understood that such efforts
      shall
      not include any requirement of the Assigning Party to pay any consideration
      or
      offer or grant any financial accommodation) to provide or cause to be provided
      to the Recipient Party the benefits of any such Contract or Permit and the
      Assigning Party will promptly pay or cause to be paid to the Recipient Party
      when received all moneys and properties received by the Assigning Party with
      respect to any such Contract or Permit and (y) the Recipient Party will pay,
      perform and discharge on behalf of the Assigning Party all of the Assigning
      Party’s Liabilities thereunder in a timely manner and in accordance with the
      terms thereof. If and when such Consents are obtained, the transfer of the
      applicable Contract or Permit shall be effected as promptly following the Time
      of Distribution as shall be practicable in accordance with the terms of this
      Agreement. To the extent that any transfers and assumptions contemplated by
      this
      Article II shall not have been consummated on or prior to the Time of
      Distribution, the parties shall cooperate to effect such transfers as promptly
      following the Time of Distribution as shall be practicable, it nonetheless
      being
      agreed and understood by the parties that no party shall be liable in any manner
      to any other party for any failure of any of the transfers contemplated by
      this
      Article II to be consummated prior to the Time of Distribution.

     

    ARTICLE
      III

    THE
      DISTRIBUTION

     

    Section
      3.01    The
      Distribution.
      

     

    (a)    Subject
      to Section 3.04, prior to the Time of Distribution, Acacia will deliver to
      the
      Distribution Agent, for the benefit of holders of record of CombiMatrix Tracking
      Stock as of the Record Date, a number of shares of CombiMatrix Common Stock
      (rounded down to the nearest whole share) equal to the number of shares of
      CombiMatrix Tracking Stock issued and outstanding as of the Record Date
      (excluding treasury shares held by Acacia), and Acacia will instruct the
      Distribution Agent to make book-entry credits on the Distribution Date or as
      soon thereafter as practicable for each holder of record of CombiMatrix Tracking
      Stock as of the Record Date, or the designated transferee or transferees of
      such
      holder, for a number of shares of CombiMatrix Common Stock (rounded down to
      the
      nearest whole share) equal to the number of shares of CombiMatrix Tracking
      Stock
      so held by such holder of record as of the Record Date (excluding treasury
      shares held by Acacia). The Distribution will be effective as of the Time of
      Distribution.

     

    
      
        
        

      

      
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    (b)    Acacia
      and CombiMatrix each will provide to the Distribution Agent all information
      (including information necessary to make appropriate book-entry credits) and
      share certificates, in each case, as may be required in order to complete the
      Distribution on the basis of one share of CombiMatrix Common Stock for every
      one
      share of CombiMatrix Tracking Stock (excluding treasury shares held by
      Acacia).

     

    Section
      3.02    Fractional
      Shares.
      Anything contained herein to the contrary notwithstanding, no fractional shares
      of CombiMatrix Common Stock will be distributed to holders of CombiMatrix
      Tracking Stock in the Distribution. Holders that are otherwise entitled to
      receive less than one whole share of CombiMatrix Common Stock in the
      Distribution will receive cash in lieu of such fractional share as contemplated
      hereby. As soon as practicable after the Distribution Date, Acacia will direct
      the Distribution Agent to determine in accordance with its customary practice
      the number of fractional shares of CombiMatrix Common Stock otherwise allocable
      to holders of record or beneficial owners of CombiMatrix Tracking Stock as
      of
      the Record Date, to aggregate all such fractional shares and sell as soon as
      practicable the whole shares obtained by aggregating such fractional shares
      either in open market transactions or otherwise, in each case at then prevailing
      trading prices, and to cause to be distributed to each such holder or for the
      benefit of each such beneficial owner, in lieu of any fractional share, such
      holder’s or owner’s ratable share of the proceeds of such sale, after making
      appropriate deductions of the amount required to be withheld for federal income
      tax purposes and after deducting an amount equal to all brokerage charges,
      commissions and transfer taxes attributed to such sale. Acacia will direct
      the
      Distribution Agent to seek to aggregate the shares of CombiMatrix Tracking
      Stock
      that may be held by any such beneficial owner thereof through more than one
      account in determining the fractional share allocable to such beneficial
      owner.

     

    Section
      3.03    Cooperation
      Prior to the Distribution.
      Prior
      to the Distribution:

     

    (a)    Acacia
      and CombiMatrix will prepare the Registration Statement which will include
      appropriate disclosure concerning CombiMatrix, its business, operations and
      management, the Contribution, the Distribution and such other matters as Acacia
      and CombiMatrix may determine and as may be required by law. Acacia and
      CombiMatrix will prepare, and CombiMatrix will file with the Commission, the
      Registration Statement. CombiMatrix will use its commercially reasonable efforts
      to cause the Registration Statement to become effective under the Securities
      Act
      as soon as practicable following the filing thereof. Promptly after
      effectiveness of the Registration Statement and prior to the Distribution,
      Acacia will mail to the holders of CombiMatrix Tracking Stock the Registration
      Statement.

     

    (b)    Acacia
      and CombiMatrix will cooperate in preparing, filing with the Commission and
      causing to become effective any registration statements or amendments thereof
      which are required to reflect the establishment of, or amendments to, any
      employee benefit and other plans contemplated by the Employee Matters
      Agreement.

     

    (c)    Acacia
      and CombiMatrix will take all such action as may be necessary or appropriate
      under the securities or “blue sky” laws of the states or other political
      subdivisions of the United States and the securities laws of any applicable
      foreign countries or other political subdivisions thereof in connection with
      the
      transactions contemplated by this Agreement.

     

    
      
        
        

      

      
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    (d)    Acacia
      and CombiMatrix will cause to be prepared, and CombiMatrix will file and use
      its
      commercially reasonable efforts to have approved, an application for the listing
      on the American Stock Exchange or another exchange approved by each of Acacia
      and CombiMatrix of the CombiMatrix Common Stock to be distributed in the
      Distribution.

     

    Section
      3.04    Acacia
      Board Action Conditions to the Distribution.
      The
      Acacia Board will in its discretion establish the Record Date and the
      Distribution Date and all appropriate procedures in connection with the
      Distribution, but in no event will the Distribution occur prior to such time
      as
      each of the following conditions shall have been satisfied or shall have been
      waived by the Acacia Board in accordance with Section 3.05:

     

    (a)    the
      Acacia Board shall be reasonably satisfied that (i) Acacia will have
      sufficient surplus under Section 170 of the Delaware General Corporation Law
      to
      permit the Distribution and (ii) after giving effect to the Contribution
      and the Distribution, each of Acacia and CombiMatrix will not be insolvent
      and
      will not have unreasonably small capital with which to engage in its respective
      businesses;

     

    (b)    the
      Acacia Board shall have given final approval of the Distribution;

     

    (c)    the
      Acacia Board shall have received a favorable opinion issued by Greenberg Traurig
      LLP confirming that the Distribution should qualify as a tax-free reorganization
      within the meaning of Section 368(a)(i)(d) of the Code;

     

    (d)    the
      Acacia Board shall have received a favorable private letter ruling issued by
      the
      Internal Revenue Service confirming that the Distribution will qualify as a
      tax-free reorganization within the meaning of Section 368(a)(i)(d) of the
      Code;

     

    (e)    all
      material Consents which are required to effect the Contribution and the
      Distribution shall have been obtained and shall be in full force and effect;
      

     

    (f)    the
      Registration Statement shall have become effective under the Securities
      Act;

     

    (g)    the
      Certificate of Incorporation and the Bylaws each shall have been adopted and
      be
      in effect;

     

    (h)    the
      transactions contemplated by Section 2.01, and Section 2.03(a) shall have
      been consummated in all material respects;

     

    (i)    Acacia
      and CombiMatrix shall have entered into each of the Separation Agreements to
      which they are parties and each such agreement shall be in full force and
      effect;

     

    (j)    no
      order,
      injunction or decree issued by any court of competent jurisdiction or other
      legal restraint or prohibition preventing consummation of the Contribution
      or
      the Distribution shall be in effect;

     

    (k)    no
      suit,
      action or proceeding by or before any court of competent jurisdiction or other
      Governmental Entity shall have been commenced and be pending to restrain or
      challenge the Contribution or Distribution, and no inquiry shall have been
      received that in the reasonable judgment of the Acacia Board may lead to such
      a
      suit, action or proceeding; and provided, that the satisfaction of such
      conditions will not create any obligation on the part of Acacia to effect or
      seek to effect the Contribution or the Distribution or in any way limit Acacia’s
      right to terminate this Agreement set forth in Section 7.13 or alter the
      consequences of any such termination from those specified in
      Section 7.13.

     

    
      
        
        

      

      
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    Section
      3.05    Waiver
      of Conditions.
      Any or
      all of the conditions set forth in Section 3.04 may be waived, in whole or
      in part, in the sole discretion of the Acacia Board. The conditions set forth
      in
      Section 3.04 are for the sole benefit of Acacia and shall not give rise to
      or create any duty on the part of Acacia or the Acacia Board to waive or not
      waive any such conditions.

     

    ARTICLE
      IV

    MUTUAL
      RELEASE; INDEMNIFICATION; EXPENSES

     

    Section
      4.01    Mutual
      Release.
      Effective as of the Time of Distribution and except as otherwise specifically
      set forth in the Separation Agreements, each of Acacia, on behalf of itself
      and
      each other member of the Acacia Group, on the one hand, and CombiMatrix, on
      behalf of itself and each other member of the CombiMatrix Group, on the other
      hand, hereby releases and forever discharges the other party and its
      Subsidiaries, and its and their respective officers, directors, agents, record
      and beneficial security holders (including trustees and beneficiaries of trusts
      holding such securities), advisors and Representatives (in each case, in their
      respective capacities as such) and their respective heirs, executors,
      administrators, successors and assigns, of and from all debts, demands, actions,
      causes of action, suits, accounts, covenants, contracts, agreements, damages,
      claims and Liabilities whatsoever of every name and nature, both in law and
      in
      equity, which the releasing party has or ever had or ever will have, which
      arise
      out of or relate to events, circumstances or actions taken by such other party
      occurring or failing to occur or any conditions existing at or prior to the
      Time
      of Distribution; provided,
      however,
      that
      the foregoing general release shall not apply to (i) any Liabilities or
      other obligations (including Liabilities with respect to payment, reimbursement,
      indemnification or contribution) under the Separation Agreements or assumed,
      transferred, assigned, allocated or arising under any of the Separation
      Agreements (including any Liability that the parties may have with respect
      to
      payment, performance, reimbursement, indemnification or contribution pursuant
      to
      any Separation Agreement for claims brought against the parties by third Persons
      or any Indemnitee), and the foregoing release will not affect any party’s right
      to enforce the Separation Agreements or Financing Agreements in accordance
      with
      their terms or (ii) any Liability arising from or relating to any
      agreement, arrangement, commitment or undertaking described in
      Section 2.02(b)(ii), or (iii) any Liability the release of which would
      result in the release of any Person other than a Person released pursuant to
      this Section 4.01 (provided,
      that
      the parties agree not to bring suit or permit any of their Subsidiaries to
      bring
      suit against any member of the other Group with respect to any Liability to
      the
      extent such member of the other Group would be released with respect to such
      Liability by this Section 4.01 but for this
      clause (iii)).

     

    
      
        
        

      

      
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    Each
      of
      Acacia and CombiMatrix acknowledges that it has been advised by its legal
      counsel and is familiar with the provisions of California Civil Code
      Section 1542, which provides as follows:

     

    “A
      GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW
      OR
      SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,
      WHICH
      IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
      WITH
      THE DEBTOR.”

     

    Being
      aware of such Code section, each of Acacia, on behalf of itself and each of
      the
      Acacia Subsidiaries, and CombiMatrix, on behalf of itself and each of the
      CombiMatrix Subsidiaries, hereby expressly waives any rights it may have under
      California Civil Code Section 1542, as well as any other statutes or common
      law principles of similar effect.

     

    Section
      4.02    Indemnification
      by Acacia.
      Subject
      to the provisions of this Article IV, Acacia shall indemnify, defend and
      hold harmless the CombiMatrix Indemnitees from and against, and pay or
      reimburse, as the case may be, the CombiMatrix Indemnitees for, all
      Indemnifiable Losses, as incurred, suffered by any CombiMatrix Indemnitee to
      the
      extent based upon, arising out of or relating to the following:

     

    (a)    the
      Acacia Liabilities (including the failure by Acacia or any other member of
      the
      Acacia Group to pay, perform or otherwise discharge the Acacia Liabilities
      in
      accordance with their terms), whether such Indemnifiable Losses are based upon,
      arise out of or relate to events, occurrences, actions, omissions, facts,
      circumstances or conditions occurring, existing or asserted before, at or after
      the Time of Distribution;

     

    (b)    the
      breach by any member of the Acacia Group of any agreement or covenant contained
      in a Separation Agreement which does not by its express terms expire at the
      Time
      of Distribution; and

     

    (c)    the
      enforcement by the CombiMatrix Indemnitees of their rights to be indemnified,
      defended and held harmless under this Section 4.02.

     

    Section
      4.03    Indemnification
      by CombiMatrix.
      Subject
      to the provisions of this Article IV, CombiMatrix shall indemnify, defend
      and hold harmless the Acacia Indemnitees from and against, and pay or reimburse,
      as the case may be, the Acacia Indemnitees for, all Indemnifiable Losses, as
      incurred, suffered by any Acacia Indemnitee to the extent based upon, arising
      out of or relating to the following:

     

    (a)    the
      CombiMatrix Liabilities (including the failure by CombiMatrix or any other
      member of the CombiMatrix Group to pay, perform or otherwise discharge the
      CombiMatrix Liabilities in accordance with their terms), whether such
      Indemnifiable Losses are based upon, arise out of or relate to events,
      occurrences, actions, omissions, facts, circumstances or conditions occurring,
      existing or asserted before, at or after the Time of Distribution;

     

    
      
        
        

      

      
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    (b)    any
      untrue statement or alleged untrue statement of a material fact contained in
      the
      Registration Statement, or any omission or alleged omission to state in the
      Registration Statement a material fact required to be stated therein or
      necessary to make the statements therein, in light of the circumstances under
      which they were made, not misleading, except in each case with respect to
      information relating to the Acacia Group provided by Acacia expressly for use
      in
      the Registration Statement;

     

    (c)    the
      breach by any member of the CombiMatrix Group of any agreement or covenant
      contained in a Separation Agreement which does not by its express terms expire
      at the Time of Distribution; the
      use
      by members of the CombiMatrix Group of any names, trademarks, trade names,
      domain names, service marks or corporate symbols or logos pursuant to
      Section 5.02; and the
      enforcement by the Acacia Indemnitees of their rights to be indemnified,
      defended and held harmless under this Section 4.03.

     

    Section
      4.04    Limitations
      on Indemnification Obligations.
      

     

    (a)    The
      amount which any party (an “Indemnifying Party”) is or may be required to pay to
      an Indemnitee in respect of Indemnifiable Losses or other Liability for which
      indemnification is provided under this Agreement shall be reduced by any amounts
      actually received (including Insurance Proceeds actually received) by or on
      behalf of such Indemnitee (net of increased insurance premiums and charges
      related directly and solely to the related Indemnifiable Losses and costs and
      expenses (including reasonable legal fees and expenses) incurred by such
      Indemnitee in connection with seeking to collect and collecting such amounts)
      in
      respect of such Indemnifiable Losses or other Liability (such net amounts are
      referred to herein as “Indemnity Reduction Amounts”). If any Indemnitee receives
      any Indemnity Reduction Amounts in respect of an Indemnifiable Loss for which
      indemnification is provided under this Agreement after the full amount of such
      Indemnifiable Loss has been paid by an Indemnifying Party or after an
      Indemnifying Party has made a partial payment of such Indemnifiable Loss and
      such Indemnity Reduction Amounts exceed the remaining unpaid balance of such
      Indemnifiable Loss, then the Indemnitee shall promptly remit to the Indemnifying
      Party an amount equal to the excess (if any) of (A) the amount theretofore
      paid by the Indemnifying Party in respect of such Indemnifiable Loss, less
      (B) the amount of the indemnity payment that would have been due if such
      Indemnity Reduction Amounts in respect thereof had been received before the
      indemnity payment was made. An insurer or other third party who would otherwise
      be obligated to pay any claim shall not be relieved of the responsibility with
      respect thereto or, solely by virtue of the indemnification provisions hereof,
      have any subrogation rights with respect thereto, it being expressly understood
      and agreed that no insurer or any other third party shall be entitled to any
      benefit they would not be entitled to receive in the absence of the
      indemnification provisions by virtue of the indemnification provisions
      hereof.

     

    (b)    In
      determining the amount of any Indemnifiable Losses, such amount shall be
      (i) reduced to take into account any net Tax benefit realized by the
      Indemnitee arising from the incurrence or payment by the Indemnitee of such
      Indemnifiable Losses and (ii) increased to take into account any net Tax
      cost incurred by the Indemnitee as a result of the receipt or accrual of
      payments hereunder (grossed-up for such increase), in each case determined
      by
      treating the Indemnitee as recognizing all other items of income, gain, loss,
      deduction or credit before recognizing any item arising from such Indemnifiable
      Losses. It is the intention of the parties that indemnity payments made pursuant
      to this Agreement are to be treated as relating back to the Distribution as
      an
      adjustment to capital (i.e.,
      capital contribution or distribution), and the parties shall not take any
      position inconsistent with such intention before any Tax Authority (as defined
      in the Tax Allocation Agreement), except to the extent that a final
      determination (as defined in Section 1313 of the Code) with respect to the
      recipient party causes any such payment not to be so treated.

     

    
      
        
        

      

      
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    Section
      4.05  Procedures
      Relating to Indemnification.

     

    (a)    If
      a
      claim or demand is made against an Indemnitee, or an Indemnitee shall otherwise
      learn of an assertion, by any Person who is not a party to this Agreement (or
      an
      Affiliate thereof) as to which an Indemnifying Party may be obligated to provide
      indemnification pursuant to this Agreement (a “Third Party Claim”), such
      Indemnitee will notify the Indemnifying Party in writing, and in reasonable
      detail, of the Third Party Claim reasonably promptly after becoming aware of
      such Third Party Claim; provided, however, that failure to give such
      notification will not affect the indemnification provided hereunder except
      to
      the extent the Indemnifying Party shall have been actually prejudiced as a
      result of such failure. Thereafter, the Indemnitee will deliver to the
      Indemnifying Party, promptly after the Indemnitee’s receipt thereof, copies of
      all material notices and documents (including court papers) received or
      transmitted by the Indemnitee relating to the Third Party Claim.

     

    (b)    If
      a
      Third Party Claim is made against an Indemnitee, the Indemnifying Party will
      be
      entitled to participate in or to assume the defense thereof (in either case,
      at
      the expense of the Indemnifying Party) with counsel selected by the Indemnifying
      Party and reasonably satisfactory to the Indemnitee. 

     

    If
      the
      Indemnifying Party elects to assume the defense of a Third Party Claim, the
      Indemnifying Party will not be liable to the Indemnitee for any legal or other
      expenses subsequently incurred by the Indemnitee in connection with the defense
      thereof; provided,
      that if
      in the Indemnitee’s reasonable judgment a conflict of interest exists in respect
      of such claim or if the Indemnifying Party shall have assumed responsibility
      for
      such claim with any reservations or exceptions, such Indemnitee will have the
      right to employ separate counsel reasonably satisfactory to the Indemnifying
      Party to represent such Indemnitee and in that event the reasonable fees and
      expenses of such separate counsel (but not more than one separate counsel for
      all Indemnitees similarly situated) shall be paid by such Indemnifying Party.
      If
      the Indemnifying Party assumes the defense of any Third Party Claim, the
      Indemnitee will have the right to participate in the defense thereof and to
      employ counsel, at its own expense, separate from the counsel employed by the
      Indemnifying Party, it being understood that the Indemnifying Party will control
      such defense. The Indemnifying Party will be liable for the fees and expenses
      of
      counsel employed by the Indemnitee for any period during which the Indemnifying
      Party has failed to assume the defense thereof. If the Indemnifying Party
      assumes the defense of any Third Party Claim, the Indemnifying Party will
      promptly supply to the Indemnitee copies of all material correspondence and
      documents relating to or in connection with such Third Party Claim and keep
      the
      Indemnitee fully informed of all material developments relating to or in
      connection with such Third Party Claim (including providing to the Indemnitee
      on
      reasonable request updates and summaries as to the status thereof). If the
      Indemnifying Party chooses to defend a Third Party Claim, the parties hereto
      will cooperate in the defense thereof (such cooperation to be at the expense,
      including reasonable legal fees and expenses, of the Indemnifying Party), which
      cooperation shall include the retention in accordance with this Agreement and
      (upon the Indemnifying Party’s request) the provision to the Indemnifying Party
      of records and information which are reasonably relevant to such Third Party
      Claim, and making employees available on a mutually convenient basis to provide
      additional information and explanation of any material provided
      hereunder.

     

    
      
        
        

      

      
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    (c)    No
      Indemnifying Party will consent to any settlement, compromise or discharge
      (including the consent to entry of any judgment) of any Third Party Claim
      without the Indemnitee’s prior written consent (which consent will not be
      unreasonably withheld); provided,
      that if
      the Indemnifying Party assumes the defense of any Third Party Claim, the
      Indemnitee will agree to any settlement, compromise or discharge of such Third
      Party Claim which the Indemnifying Party may recommend and which by its terms
      obligates the Indemnifying Party to pay the full amount of Indemnifiable Losses
      in connection with such Third Party Claim and unconditionally and irrevocably
      releases the Indemnitee and its Affiliates completely from all Liability in
      connection with such Third Party Claim; provided,
      however,
      that
      the Indemnitee may refuse to agree to any such settlement, compromise or
      discharge (x) that provides for injunctive or other nonmonetary relief
      affecting the Indemnitee or any of its Affiliates or (y) that, in the
      reasonable opinion of the Indemnitee, would otherwise materially adversely
      affect the Indemnitee or any of its Affiliates. Whether or not the Indemnifying
      Party shall have assumed the defense of a Third Party Claim, the Indemnitee
      will
      not (unless required by law) admit any liability with respect to, or settle,
      compromise or discharge, such Third Party Claim without the Indemnifying Party’s
      prior written consent (which consent will not be unreasonably
      withheld).

     

    (d)    Any
      claim
      on account of Indemnifiable Losses which does not involve a Third Party Claim
      will be asserted by reasonably prompt written notice given by the Indemnitee
      to
      the Indemnifying Party from whom such indemnification is sought. The failure
      by
      any Indemnitee so to notify the Indemnifying Party will not relieve the
      Indemnifying Party from any liability which it may have to such Indemnitee
      under
      this Agreement, except to the extent that the Indemnifying Party shall have
      been
      actually prejudiced by such failure.

     

    (e)    In
      the
      event of payment in full by an Indemnifying Party to any Indemnitee in
      connection with any Third Party Claim, such Indemnifying Party will be
      subrogated to and shall stand in the place of such Indemnitee as to any events
      or circumstances in respect of which such Indemnitee may have any right or
      claim
      relating to such Third Party Claim against any claimant or plaintiff asserting
      such Third Party Claim or against any other Person. Such Indemnitee will
      cooperate with such Indemnifying Party in a reasonable manner, and at the cost
      and expense of such Indemnifying Party, in prosecuting any subrogated right
      or
      claim.

     

    Section
      4.06    Remedies
      Cumulative.
      Subject
      to the provisions of Section 7.05, the remedies provided in this
      Article IV shall be cumulative and shall not preclude assertion by any
      Indemnitee of any other rights or the seeking of any and all other remedies
      against any Indemnifying Party.

     

    
      
        
        

      

      
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    Section
      4.07    Indemnification
      Under Tax Allocation Agreement.
      Notwithstanding anything in this Agreement to the contrary, indemnification
      in
      respect of Tax matters will be governed exclusively by the Tax Allocation
      Agreement.

     

    Section
      4.08    Expenses.
      

     

    (a)    Except
      as
      otherwise set forth in any Separation Agreement, (i) all Acacia Expenses
      will be charged to and paid by Acacia and (ii) all CombiMatrix Expenses will
      be
      charged to and paid by CombiMatrix.

     

    (b)    Within
      ten days after the Distribution Date, CombiMatrix will reimburse Acacia (by
      wire
      transfer to a bank account designated in writing by CombiMatrix) for all amounts
      in respect of CombiMatrix Expenses paid by Acacia or any of its Subsidiaries
      (including Persons comprising the CombiMatrix Group) before or at the Time
      of
      Distribution and notified in writing by Acacia to CombiMatrix within five days
      after the Distribution Date. From time to time thereafter, promptly after
      Acacia’s request therefor, and in any event within ten days after any such
      request, CombiMatrix will reimburse Acacia (by wire transfer to the same bank
      account referred to in the preceding sentence) for all CombiMatrix Expenses
      paid
      by Acacia or any of its Subsidiaries before, at or after the Time of
      Distribution (other than as previously reimbursed by CombiMatrix pursuant to
      the
      preceding sentence). Acacia will, at the request of CombiMatrix, provide
      CombiMatrix with appropriate documentation to support CombiMatrix Expenses
      required to be reimbursed to Acacia pursuant to this Section
      4.08(b).

     

    (c)    Within
      ten days after the Distribution Date, Acacia will reimburse CombiMatrix (by
      wire
      transfer to a bank account designated in writing by Acacia for all amounts
      in
      respect of Acacia Expenses paid by CombiMatrix or any of its Subsidiaries
      (including Persons comprising the Acacia Group) before or at the Time of
      Distribution and notified in writing by CombiMatrix to Acacia within five days
      after the Distribution Date. From time to time thereafter, promptly after
      CombiMatrix’s request therefor, and in any event within ten days after any such
      request, Acacia will reimburse CombiMatrix (by wire transfer to the same bank
      account referred to in the preceding sentence) for all Acacia Expenses paid
      by
      CombiMatrix or any of its Subsidiaries before, at or after the Time of
      Distribution (other than as previously reimbursed by Acacia pursuant to the
      preceding sentence). CombiMatrix will, at the request of Acacia, provide Acacia
      with appropriate documentation to support Acacia Expenses required to be
      reimbursed to CombiMatrix pursuant to this Section 4.08(c).

     

    (d)    Except
      as
      otherwise set forth in any Separation Agreement, and subject in all events
      to
      the provisions of Section 4.08(a), all out-of-pocket costs and expenses incurred
      following the Time of Distribution in connection with implementation of the
      transactions contemplated by the Separation Agreements will be charged to and
      paid by the party for whose benefit the expenses are incurred, with any
      out-of-pocket expenses which cannot be allocated on such basis to be split
      equally between Acacia and CombiMatrix.

     

    (e)    The
      third-party costs and expenses of the Registration Statement shall be shared
      between Acacia and CombiMatrix equally. Within a reasonable time Following
      the
      Time of Distribution and receipt of an invoice from Acacia, including any
      back-up documentation reasonable requested by CombiMatrix, CombiMatrix shall
      reimburse Acacia for its share of such costs and expenses.

     

    
      
        
        

      

      
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    ARTICLE
      V

    CERTAIN
      OTHER MATTERS

     

    Section
      5.01    Insurance.
      

     

    (a)    Coverage.
      Subject
      to the provisions of this Section 5.01, coverage of CombiMatrix and the
      CombiMatrix Subsidiaries under all Policies shall cease as of the Time of
      Distribution. From and after the Time of Distribution, CombiMatrix and the
      CombiMatrix Subsidiaries will be responsible for obtaining and maintaining
      all
      insurance coverages in their own right.

     

    (b)    Rights
      Under Shared Policies.
      From
      and after the Time of Distribution, CombiMatrix and the CombiMatrix Subsidiaries
      will have no rights with respect to any Policies, except that:

     

    (i)    CombiMatrix
      will have the right to assert claims (and Acacia will use commercially
      reasonable efforts to assist CombiMatrix in asserting claims) for any loss,
      liability or damage with respect to CombiMatrix Assets or CombiMatrix
      Liabilities under Policies with third-party insurers which are “occurrence
      basis” insurance policies (“Occurrence
      Basis Policies”)
      arising out of insured incidents occurring from the date coverage thereunder
      first commenced until the Time of Distribution to the extent that the terms
      and
      conditions of any such Occurrence Basis Policies and agreements relating thereto
      so allow, and

     

    (ii)   CombiMatrix
      will have the right to continue to prosecute claims with respect to CombiMatrix
      Assets or CombiMatrix Liabilities properly asserted with an insurer prior to
      the
      Time of Distribution (and Acacia will use commercially reasonable efforts to
      assist CombiMatrix in connection therewith) under Policies with third-party
      insurers which are insurance policies written on a “claims made” basis
      (“Claims
      Made Policies”)
      arising out of insured incidents occurring from the date coverage thereunder
      first commenced until the Time of Distribution to the extent that the terms
      and
      conditions of any such Claims Made Policies and agreements relating thereto
      so
      allow,

     

    provided,
      that in
      the case of both clauses (i) and (ii) above, (A) all of Acacia’s and each
      Acacia Subsidiary’s reasonable out-of-pocket costs and expenses incurred in
      connection with the foregoing are promptly paid by CombiMatrix, (B) Acacia
      and the Acacia Subsidiaries may, at any time, without liability or obligation
      to
      CombiMatrix or any CombiMatrix Subsidiary(other than as set forth in
      Section 5.01(c)), amend, commute, terminate, buy-out, extinguish liability
      under or otherwise modify any Occurrence Basis Policies or Claims Made Policies
      (and such claims shall be subject to any such amendments, commutations,
      terminations, buy-outs, extinguishments and modifications), (C) such claims
      will be subject to (and recovery thereon will be reduced by the amount of)
      any
      applicable deductibles, retentions or self-insurance provisions, (D) such
      claims will be subject to (and recovery thereon will be reduced

     

    
      
        
        

      

      
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    by
      the
      amount of) any payment or reimbursement obligations of Acacia, any Acacia
      Subsidiary or any Affiliate of Acacia or any Acacia Subsidiary in respect
      thereof and (E) such claims will be subject to exhaustion of existing
      aggregate limits. In the event that claims submitted by Acacia and CombiMatrix
      exhaust existing aggregate limits in any one policy year, the amount payable
      under the Policies shall be allocated pro rata based on the amounts paid in
      satisfaction of such claims or the amounts that would have been paid to satisfy
      such claims absent exhaustion of Policy limits. To the extent the amount paid
      to
      CombiMatrix or Acacia, as the case may be, in satisfaction of claims exceeds
      its
      pro rata portion, CombiMatrix or Acacia, as the case may be, shall pay to the
      other party an amount equal to such excess. Acacia’s obligation to use
      commercially reasonable efforts to assist CombiMatrix in asserting claims under
      applicable Policies will include using commercially reasonable efforts in
      assisting CombiMatrix to establish its right to coverage under such Policies
      (so
      long as all of Acacia’s reasonable out-of-pocket costs and expenses in
      connection therewith are promptly paid by CombiMatrix). None of Acacia or the
      Acacia Subsidiaries will bear any Liability for the failure of an insurer to
      pay
      any claim under any Policy. It is understood that any Claims Made Policies
      will
      not provide any coverage to CombiMatrix and the CombiMatrix Subsidiaries for
      incidents occurring prior to the Time of Distribution but which are asserted
      with the insurance carrier after the Time of Distribution. If a claim or claims
      submitted by CombiMatrix are paid under any Policy during any policy year in
      which no claim or claims are paid to Acacia, and Acacia’s annual premium
      increases in the next policy year in respect of the Policy, then the full amount
      of such premium increase in the first policy year after such CombiMatrix claim
      or claims are paid shall be deemed to be attributable to the CombiMatrix claim
      or claims and charged to CombiMatrix. Promptly (and in no event later than
      ten
      (10) Business Days) after receipt of a written request by Acacia, CombiMatrix
      shall reimburse Acacia for the full amount of such annual premium increase.
      If
      claims submitted by both Acacia and CombiMatrix are paid under the same Policy
      during any policy year, and Acacia’s annual premium increases in the next policy
      year in respect of the Policy, then the amount of the premium increase will
      be
      allocated between Acacia and CombiMatrix based on the amount of the claims
      paid
      to each party during the prior policy year. Promptly (and in no event later
      than
      ten (10) Business Days) after receipt of a written request by Acacia,
      CombiMatrix shall reimburse Acacia for its pro rata portion.

     

    (c)    Acacia
      Actions.
      If,
      after the Time of Distribution, Acacia or any Acacia Subsidiary proposes to
      amend, commute, terminate, buy-out, extinguish liability under or otherwise
      modify any Policies under which CombiMatrix has rights to assert claims pursuant
      to Section 5.01(b) in a manner that would adversely affect any such rights
      of CombiMatrix, (i) Acacia will give CombiMatrix prior notice thereof and
      consult with CombiMatrix with respect to such action (it being understood that
      the decision to take any such action will be in the sole discretion of Acacia)
      and (ii) Acacia will pay to CombiMatrix its equitable share (which shall be
      determined by Acacia in good faith based on the amount of premiums paid by
      or
      allocated to the CombiMatrix Business in respect of the applicable Policy)
      of
      any net proceeds actually received by Acacia from the insurer under the
      applicable Policy as a result of such action by Acacia (after deducting Acacia’s
      reasonable costs and expenses incurred in connection with such
      action).

     

    (d)    Administration.
      From
      and after the Time of Distribution:

     

    
      
        
        

      

      
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    (i)    Acacia
      or
      an Acacia Subsidiary will be responsible for the Claims Administration with
      respect to claims of Acacia and the Acacia Subsidiaries under Policies;
      and

     

    (ii)   CombiMatrix
      or a CombiMatrix Subsidiary will be responsible for the Claims Administration
      with respect to claims of CombiMatrix and the CombiMatrix Subsidiaries under
      Policies.

     

    (e)    Insurance
      Premiums.
      From
      and after the Time of Distribution, Acacia will pay all premiums
      (retrospectively-rated or otherwise) as required under the terms and conditions
      of the respective Policies in respect of periods prior to the Time of
      Distribution, whereupon CombiMatrix will, upon the request of Acacia, promptly
      reimburse Acacia for that portion of such premiums paid by Acacia as are
      reasonably determined by Acacia to be attributable to the CombiMatrix
      Business.

     

    (f)    Agreement
      for Waiver of Conflict and Shared Defense.
      In the
      event that a Policy provides coverage for both Acacia and/or an Acacia
      Subsidiary, on the one hand, and CombiMatrix and/or a CombiMatrix Subsidiary,
      on
      the other hand, relating to the same occurrence, Acacia and CombiMatrix agree
      to
      defend jointly and to waive any conflict of interest necessary to the conduct
      of
      that joint defense. Nothing in this Section 5.01(f) will be construed to
      limit or otherwise alter in any way the indemnity obligations of the parties
      to
      this Agreement, including those created by this Agreement, by operation of
      law
      or otherwise.

     

    Section
      5.02    Use
      of
      Names, Trademarks, etc.

     

    (a)    From
      and
      after the Time of Distribution, subject to Section 5.02(b), Acacia will own
      all rights of Acacia or any of its Subsidiaries in, and to the use of, the
      Acacia Marks.

     

    (b)    From
      and
      after the Time of Distribution, except as permitted in this
      Section 5.02(b), the CombiMatrix Group will not use or have any rights to
      the Acacia Marks or any name, mark or symbol confusingly similar thereto, or
      any
      special script, type font, form, style, logo, design, device, trade dress or
      symbol which contains, represents or evokes the Acacia Marks or any name or
      mark
      confusingly similar thereto. From and after the Time of Distribution, the
      CombiMatrix Group will not hold itself out as having any affiliation with the
      Acacia Group.

     

    (c)    No
      member
      of the CombiMatrix Group shall have any right, title or interest in, or to
      the
      use of the Acacia Marks, either alone or in combination with any other word,
      name, symbol, device, trademarks, or any combination thereof. Anything contained
      herein to the contrary notwithstanding, in no event will any member of the
      CombiMatrix Group use the Acacia Marks as a component of a company or trade
      name. CombiMatrix will not, and will cause each other member of the CombiMatrix
      Group not to, challenge or contest the validity of the Acacia Marks, the
      registration thereof or the ownership thereof by the Acacia Group. CombiMatrix
      will not, and will cause each other member of the CombiMatrix Group not to,
      apply anywhere at any time for any registration as owner or exclusive licensee
      of the Acacia Marks. If, notwithstanding the foregoing, any member of the
      CombiMatrix Group develops, adopts or acquires, directly or indirectly, any
      right, title or interest in, or to the use of, any Acacia Marks in any
      jurisdiction, or any goodwill incident thereto, CombiMatrix will, and will
      cause
      the CombiMatrix Subsidiaries, upon the request of Acacia, and for a nominal
      consideration of one dollar, assign or cause to be assigned to Acacia or any
      designee of Acacia, all right, title and interest in, and to the use of, such
      Acacia Marks in any and all jurisdictions, together with any goodwill incident
      thereto.

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    CombiMatrix
      hereby constitutes and appoints Acacia the true and lawful attorney of
      CombiMatrix and its Subsidiaries to act as their attorney-in-fact to execute
      any
      documents and to take all necessary steps to cause CombiMatrix and its
      Subsidiaries to perform any of their obligations set forth in this
      Section 5.02(c), provided,
      however,
      that
      Acacia will provide CombiMatrix sixty days written notice prior to executing
      such documents or commencing such steps.

     

    Section
      5.03    CombiMatrix
      Warrants.
      

     

    (a)    Effective
      as of the Time of Distribution, CombiMatrix will issue to each holder of a
      May
      2003 Warrant a warrant to purchase shares of CombiMatrix Common Stock (the
      “CombiMatrix/May
      2003 Warrant”),
      pursuant to the equitable adjustment and other provisions of such May 2003
      Warrant. The number of shares of CombiMatrix Common Stock subject to the
      CombiMatrix/May 2003 Warrant and the per-share exercise price of the
      CombiMatrix/May 2003 Warrant will be determined as set forth in the May 2003
      Warrant. The CombiMatrix/May 2003 Warrant will otherwise have substantially
      the
      same terms and conditions as the May 2003 Warrant, except that references to
      Acacia will be changed to refer to CombiMatrix.

     

    (b)    Effective
      as of the Time of Distribution, CombiMatrix will issue to each holder of the
      Piper 2005 Warrant a warrant to purchase shares of CombiMatrix Common Stock
      (the
“CombiMatrix/Piper 2005 Warrant”), pursuant to the equitable adjustment and
      other provisions of such Piper 2005 Warrant. The number of shares of CombiMatrix
      Common Stock subject to the CombiMatrix/Piper 2005 Warrant and the per-share
      exercise price of the CombiMatrix/Piper 2005 Warrant will be determined as
      set
      forth in the Piper 2005 Warrant. The CombiMatrix/Piper 2005 Warrant will
      otherwise have substantially the same terms and conditions as the Piper 2005
      Warrant, except that references to Acacia will be changed to refer to
      CombiMatrix.

     

    (c)    Effective
      as of the Time of Distribution, CombiMatrix will issue to each holder of the
      Oppenheimer Warrant a warrant to purchase shares of CombiMatrix Common Stock
      (the “CombiMatrix/Oppenheimer
      Warrant”),
      pursuant to the equitable adjustment and other provisions of such Oppenheimer
      Warrant. The number of shares of CombiMatrix Common Stock subject to the
      CombiMatrix/Oppenheimer Warrant and the per-share exercise price of the
      CombiMatrix/Oppenheimer Warrant will be determined as set forth in the
      Oppenheimer Warrant. The CombiMatrix/Oppenheimer Warrant will otherwise have
      substantially the same terms and conditions as the Oppenheimer Warrant, except
      that references to Acacia will be changed to refer to CombiMatrix.

     

    
      
        
        

      

      
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    ARTICLE
      VI

    ACCESS
      TO
      INFORMATION

     

    Section
      6.01    Provision
      of Corporate Records.
      Prior
      to or as promptly as practicable after the Time of Distribution, Acacia shall
      deliver to CombiMatrix all minute books and other records of meetings of the
      Board of Directors, committees of the Board of Directors and stockholders of
      the
      CombiMatrix Group and all corporate books and records of the CombiMatrix Group
      in its possession, including, in each case, all active agreements and active
      litigation files. From and after the Time of Distribution, all such books and
      records shall be the property of CombiMatrix. Prior to or as promptly as
      practicable after the Time of Distribution, CombiMatrix shall deliver to Acacia
      all corporate books and records of the Acacia Group in CombiMatrix’s possession
      (other than the books and records described in the first sentence of this
      Section 6.01), including, in each case, all active agreements and active
      litigation files. From and after the Time of Distribution, all such books and
      records shall be the property of Acacia.

     

    Section
      6.02    Access
      to
      Information.
      

     

    (a)    From
      and
      after the Time of Distribution, Acacia will, and will cause each Acacia
      Subsidiary to, afford to CombiMatrix and its Representatives (at CombiMatrix’s
      expense) reasonable access and duplicating rights during normal business hours
      and upon reasonable advance notice to all Information within the Acacia Group’s
      possession or control relating to CombiMatrix, any CombiMatrix Subsidiary,
      any
      CombiMatrix Asset, any CombiMatrix Liability or the CombiMatrix Business,
      insofar as such access is reasonably required by CombiMatrix or any CombiMatrix
      Subsidiary, subject to the provisions below regarding Privileged
      Information.

     

    (b)    From
      and
      after the Time of Distribution, CombiMatrix will, and will cause each
      CombiMatrix Subsidiary to, afford to Acacia and its Representatives (at Acacia’s
      expense) reasonable access and duplicating rights during normal business hours
      and upon reasonable advance notice to all Information within the CombiMatrix
      Group’s possession or control relating to Acacia, any Acacia Subsidiary, any
      Acacia Asset, any Acacia Liability or the Acacia Business, insofar as such
      access is reasonably required, by Acacia or any Acacia Subsidiary, subject
      to
      the provisions below regarding Privileged Information.

     

    (c)    Without
      limiting the foregoing, Information may be requested under this Article VI
      for audit, accounting, claims, litigation, insurance, environmental and safety
      and tax purposes, as well as for purposes of fulfilling disclosure and reporting
      obligations and for performing this Agreement and the transactions contemplated
      hereby.

     

    In
      furtherance of the foregoing:

     

    (i)    Each
      party acknowledges that (A) each of Acacia and CombiMatrix (and the members
      of the Acacia Group and the CombiMatrix Group, respectively) has or may obtain
      Privileged Information; (B) there are or may be a number of Actions
      affecting one or more of the members of the Acacia Group and the CombiMatrix
      Group; (C) the parties may have a common legal interest in Actions, in the
      Privileged Information, and in the preservation of the confidential status
      of
      the Privileged Information; and (D) each of Acacia and CombiMatrix intends
      that the transactions contemplated by the Separation Agreements and any transfer
      of Privileged Information in connection therewith shall not operate as a waiver
      of any potentially applicable privilege.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    (ii)   Each
      of
      Acacia and CombiMatrix agrees, on behalf of itself and each member of the Group
      of which it is a member, not to disclose or otherwise waive any privilege
      attaching to any Privileged Information relating to the business of the other
      Group or relating to or arising in connection with the relationship between
      the
      Groups on or prior to the Time of Distribution, without providing prompt written
      notice to and obtaining the prior written consent of the other, which consent
      will not be unreasonably withheld. In the event of a disagreement between any
      member of the Acacia Group and any member of the CombiMatrix Group concerning
      the reasonableness of withholding such consent, no disclosure will be made
      prior
      to a final, nonappealable resolution of such disagreement by a court of
      competent jurisdiction.

     

    (iii)   Upon
      any
      member of the Acacia Group or any member of the CombiMatrix Group receiving
      any
      subpoena or other compulsory disclosure notice from a court, other Governmental
      Entity or otherwise which requests disclosure of Privileged Information, in
      each
      case relating to the business of the other Group or relating to or arising,
      in
      connection with the relationship between the Groups on or prior to the Time
      of
      Distribution, the recipient of the notice will promptly provide to the other
      party (following the notice provisions set forth herein) a copy of such notice,
      the intended response, and a description of all materials or information
      relating to the other Group that might be disclosed. In the event of a
      disagreement as to the intended response or disclosure, unless and until the
      disagreement is resolved as provided in Section 6.02(c)(ii), the parties
      will cooperate to assert all defenses to disclosure claimed by either Group,
      at
      the cost and expense of the Group claiming such defense to disclosure, and
      shall
      not disclose any disputed documents or information until all legal defenses
      and
      claims of privilege have been finally determined.

     

    Section
      6.03    Production
      of Witnesses.
      Subject
      to Section 6.02, after the Time of Distribution, each of Acacia and
      CombiMatrix will, and will cause each member of the Acacia Group and the
      CombiMatrix Group, respectively, to, make available to the other party and
      members of such other party’s Group, upon written request and at the cost and
      expense of the party so requesting, its directors, officers, employees and
      agents as witnesses to the extent that any such Person may reasonably be
      required (giving consideration to business demands of such directors, officers,
      employees and agents) in connection with any Actions, administrative or other
      proceedings in which the requesting party may from time to time be involved
      and
      relating to the business of either Group or relating to or arising in connection
      with the relationship between the Groups on or prior to the Time of
      Distribution, provided
      that the
      same shall not unreasonably interfere with the conduct of business by the Group
      of which the request is made.

     

    Section
      6.04    Retention
      of Records.
      Except
      as otherwise required by law or agreed to by the parties in writing, if any
      Information relating to the pre-Distribution business, Assets or Liabilities
      of
      a member of a Group is retained by a member of the other Group, each of Acacia
      and CombiMatrix will, and will cause the members of the Group of which it is
      a
      member to, retain for the period required by the applicable Acacia records
      retention policy in effect immediately prior to the Time of Distribution all
      such Information in such Group’s possession or under its control. In addition,
      if, prior to the scheduled date for destruction or disposal of such Information
      under the applicable Acacia records retention policy, Acacia or CombiMatrix,
      on
      behalf of any member of its Group, requests in writing that any of the
      Information scheduled to be destroyed or disposed of be delivered to such
      requesting party, the party whose Group is scheduled to destroy or dispose
      of
      such Information will arrange for the delivery of the requested Information
      to a
      location specified by, and at the expense of, the requesting party, at or about
      the time such Information would have otherwise been destroyed or disposed
      of.

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    Section
      6.05    Confidentiality.
      Subject
      to the provisions of Section 6.02, which shall govern Privileged
      Information, from and after the Time of Distribution, each of Acacia and
      CombiMatrix shall hold, and shall use reasonable efforts to cause members of
      its
      Group and its and their Affiliates and Representatives to hold, in strict
      confidence all Information concerning the other party’s Group in its possession
      or control prior to the Time of Distribution or furnished to it by such other
      party’s Group pursuant to the Separation Agreements or the transactions
      contemplated thereby and will not release or disclose such Information to any
      other Person, except members of its Group and its and their Representatives,
      who
      will be bound by the provisions of this Section 6.05; provided,
      however,
      that
      any member of the Acacia Group or the CombiMatrix Group may disclose such
      Information to the extent that (a) disclosure is compelled by judicial or
      administrative process or, in the opinion of such Person’s counsel, by other
      requirements of law (in which case the party required to make such disclosure
      will notify the other party as soon as practicable of such obligation or
      requirement and cooperate with the other party (at the expense of the other
      party) to limit the Information required to be disclosed and to obtain a
      protective order or other appropriate remedy with respect to the Information
      ultimately disclosed) or (b) such Person can show that such Information was
      (i) available to such Person on a nonconfidential basis (other than from a
      member of the other party’s Group) prior to its disclosure by such Person,
      (ii) in the public domain through no fault of such Person or
      (iii) lawfully acquired by such Person from another source after the time
      that it was furnished to such Person by the other party’s Group, and not
      acquired from such source subject to any confidentiality obligation on the
      part
      of such source known to the acquiror, or on the part of the acquiror. Each
      party
      acknowledges that it will be liable for any breach of this Section 6.05 by
      its Affiliates, Representatives and Subsidiaries. Notwithstanding the foregoing,
      each of Acacia and CombiMatrix will be deemed to have satisfied its obligations
      under this Section 6.05 with respect to any Information (other than
      Privileged Information) if it exercises the same care with regard to such
      Information as it takes to preserve confidentiality for its own similar
      Information.

     

    ARTICLE
      VII

    MISCELLANEOUS

     

    Section
      7.01    Entire
      Agreement; Construction.
      This
      Agreement and the Separation Agreements, including any annexes, schedules and
      exhibits hereto or thereto, and other agreements and documents referred to
      herein and therein, will together constitute the entire agreement between the
      parties with respect to the subject matter hereof and thereof and will supersede
      all prior negotiations, agreements and understandings of the parties of any
      nature, whether oral or written, with respect to such subject matter.
      Notwithstanding any other provisions in the Separation Agreements to the
      contrary, (i) if and to the extent that there is a conflict between the
      provisions of this Agreement and the provisions of the Employee Matters
      Agreement or the Tax Allocation Agreement, the provisions of the Employee
      Matters Agreement or the Tax Allocation Agreement, as appropriate, will control
      and (ii) in the event and to the extent that there is a conflict between
      the provisions of this Agreement and the provisions of any Conveyance
      Instruments, the provisions of this Agreement will control.

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    Section
      7.02    Survival
      of Agreements.
      Except
      as otherwise contemplated by the Separation Agreements (including
      Section 7.13 of this Agreement), all covenants and agreements of the
      parties contained in the Separation Agreements will remain in full force and
      effect and survive the Time of Distribution. The obligations of each of Acacia
      and CombiMatrix under Article IV will not terminate at any time and will
      survive the sale or other transfer by any party of any assets or businesses
      or
      the assignment by any party of any Liabilities with respect to any Indemnifiable
      Losses of the other related to such assets, businesses or
      Liabilities.

     

    Section
      7.03    Governing
      Law.
      This
      Agreement will be governed by and construed in accordance with the internal
      laws
      of the State of California applicable to contracts made and to be performed
      entirely within such State, without regard to the conflicts of law principles
      of
      such State.

     

    Section
      7.04    Notices.
      All
      notices, requests, claims, demands and other communications required or
      permitted to be given hereunder will be in writing and will be delivered by
      hand
      or telecopied, e-mailed or sent, postage prepaid, by registered, certified
      or
      express mail or reputable overnight courier service and will be deemed given
      when so delivered by hand or telecopied, when e-mail confirmation is received
      if
      delivered by e-mail, or three Business Days after being so mailed (one Business
      Day in the case of express mail or overnight courier service). All such notices,
      requests, claims, demands and other communications will be addressed as set
      forth below, or pursuant to such other instructions as may be designated in
      writing by the party to receive such notice:

     

    If
      to
      Acacia:

    Acacia
      Research Corporation

    500
      Newport Center Dr., 7th Floor

    Newport
      Beach, California 92660

    Attention: Paul
      Ryan, President

    Telecopy: (949)
      480-8390

    E-mail:prr@acaciares.com

     

    with
      a
      copy to:

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

     

    Acacia
      Research Corporation

    500
      Newport Center Dr., 7th Floor

    Newport
      Beach, California 92660

    Attention:
       Robert
      Berman, Esq.

    Chief
      Operating Officer and General Counsel

    Telecopy: (949)
      480-8390

    E-mail:rberman@acaciares.com

     

    If
      to
      CombiMatrix:

     

    CombiMatrix
      Corporation

    6500
      Harbour Heights Parkway, Suite 301

    Mukilteo,
      WA 98275

    Attention: Amit
      Kumar 

    Chief
      Executive Officer

    Telecopy: (425)
      493-2060

    E-mail:akumar@combimatrix.com

     

    Section
      7.05    Dispute
      Resolution.
      In the
      event that from and after the Time of Distribution any dispute, claim or
      controversy (collectively, a “Dispute”)
      arises
      out of or relates to this Agreement, the Employee Matters Agreement or the
      Tax
      Allocation Agreement or any transaction contemplated thereby or the breach,
      performance, enforcement or validity or invalidity of any thereof, the designees
      of the Acacia Chief Executive Officer and the CombiMatrix Chief Executive
      Officer will attempt a good faith resolution of the Dispute within thirty days
      after either party notifies the other party in writing of the Dispute. If the
      Dispute is not resolved within thirty days of the receipt of the notification,
      or within such other time as they may agree, the Dispute will be referred for
      resolution to the Acacia Chief Executive Officer and the CombiMatrix Chief
      Executive Officer. Should they be unable to resolve the Dispute within thirty
      days following the referral to them, or within such other time as they may
      agree, Acacia and CombiMatrix will then attempt in good faith to resolve such
      Dispute by mediation in accordance with the then-existing CPR Mediation
      Procedures promulgated by the CPR Institute for Dispute Resolution. If such
      mediation is unsuccessful within sixty days after commencement thereof, any
      party to the Dispute may pursue any other remedies available to it.

     

    Section
      7.06    Consent
      to Jurisdiction.
      Each of
      Acacia and CombiMatrix irrevocably submits to the exclusive jurisdiction of
      (i) the Superior Court of the State of California, Orange County and
      (ii) the United States District Court for the Central District of
      California, for the purposes of any suit, action or other proceeding arising
      out
      of this Agreement, the Employee Matters Agreement or the Tax Allocation
      Agreement or any transaction contemplated thereby or the breach, performance,
      enforcement or validity or invalidity of any thereof (and agrees not to commence
      any action, suit or proceeding relating thereto except in such courts). Each
      of
      Acacia and CombiMatrix further agrees that service of any process, summons,
      notice or document hand delivered or sent by U.S. registered mail to such
      party’s respective address set forth in Section 7.04 will be effective
      service of process for any action, suit or proceeding in California with respect
      to any matters to which it has submitted to jurisdiction as set forth in the
      immediately preceding sentence. Each of Acacia and

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

       

      CombiMatrix
        irrevocably and unconditionally waives any objection to the laying of venue
        of
        any action, suit or proceeding arising out of this Agreement, the Employee
        Matters Agreement or the Tax Allocation Agreement or the transactions
        contemplated thereby or the breach, performance, enforcement or validity
        or
        invalidity of any thereof in (i) the Superior Court of the State of
        California, Orange County or (ii) the United States District Court for the
        Central District of California, and hereby further irrevocably and
        unconditionally waives and agrees not to plead or claim in any such Court
        that
        any such action, suit or proceeding brought in any such court has been brought
        in an inconvenient forum. Notwithstanding the foregoing, each party agrees
        that
        a final judgment in any action, suit or proceeding so brought shall be
        conclusive and may be enforced by suit on the judgment in any jurisdiction
        or in
        any other manner provided in law or in equity.

    

     

    Section
      7.07    Amendments.
      This
      Agreement cannot be amended, modified or supplemented except by a written
      agreement executed by Acacia and CombiMatrix.

     

    Section
      7.08    Assignment.
      Except
      as otherwise provided herein, neither party will convey, assign or otherwise
      transfer any of its rights or obligations under this Agreement without the
      prior
      written consent of the other party in its sole and absolute discretion.
      Notwithstanding the foregoing, either party may (without obtaining any consent)
      assign all or any portion of its rights and obligations hereunder to
      (i) the surviving entity resulting from a merger or consolidation involving
      such party, (ii) the acquiring entity in a sale or other disposition of all
      or substantially all of the assets of such party as a whole or of any line
      of
      business or division of such party, or (iii) any other Person that is
      created as a result of a spin-off from, or similar reorganization transaction
      of, such party or any line of business or division of such party. In the event
      of an assignment pursuant to (ii) or (iii) above, the non-assigning party shall,
      at the assigning party’s request, use good faith commercially reasonable efforts
      to enter into separate agreements with each of the resulting entities and take
      such further actions as may be reasonably required to assure that the rights
      and
      obligations under this Agreement are preserved, in the aggregate, and divided
      equitably between such resulting entities. Any conveyance, assignment or
      transfer requiring the prior written consent of another party pursuant to this
      Section 7.08 which is made without such consent will be void ab
      initio.
      No
      assignment of this Agreement will relieve the assigning party of its obligations
      hereunder.

     

    Section
      7.09    Captions;
      Currency.
      The
      article, section and paragraph captions herein and the table of contents hereto
      are for convenience of reference only, do not constitute part of this Agreement
      and will not be deemed to limit or otherwise affect any of the provisions
      hereof. Unless otherwise specified, all references herein to numbered articles
      or sections are to articles and sections of this Agreement and all references
      herein to schedules are to schedules to this Agreement. Unless otherwise
      specified, all references contained in this Agreement, in any schedule referred
      to herein or in any instrument or document delivered pursuant hereto to dollars
      or “$” shall mean United States Dollars.

     

    Section
      7.10    Severability.
      If any
      provision of this Agreement or the application thereof to any Person or
      circumstance is determined by a court of competent jurisdiction to be invalid,
      void or unenforceable, the remaining provisions hereof, or the application
      of
      such provision to Persons or circumstances other than those as to which it
      has
      been held invalid or unenforceable, will remain in full force and effect and
      will in no way be affected, impaired or invalidated thereby. If the economic
      or
      legal substance of the transactions contemplated hereby is affected in any
      manner adverse to any party as a result thereof, the parties will negotiate
      in
      good faith in an effort to agree upon a suitable and equitable substitute
      provision to effect the original intent of the parties.

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    Section
      7.11    Parties
      in Interest.
      This
      Agreement is binding upon and is for the benefit of the parties hereto and
      their
      respective successors and permitted assigns. This Agreement is not made for
      the
      benefit of any Person not a party hereto, and no Person other than the parties
      hereto or their respective successors and permitted assigns will acquire or
      have
      any benefit, right, remedy or claim under or by reason of this Agreement, except
      that the provisions of Sections 4.02 and 4.03 shall inure to the benefit of
      and shall be enforceable by the Persons referred to therein.

     

    Section
      7.12    Schedules.
      All
      schedules attached hereto are hereby incorporated in and made a part of this
      Agreement as if set forth in full herein. Capitalized terms used in the
      schedules hereto but not otherwise defined therein will have the respective
      meanings assigned to such terms in this Agreement.

     

    Section
      7.13    Termination.
      This
      Agreement may be terminated and the Distribution abandoned at any time prior
      to
      the Time of Distribution by and in the sole discretion of the Acacia Board
      without the approval of CombiMatrix or Acacia’s shareowners. In the event of
      such termination, neither party will have any liability of any kind to the
      other
      party on account of such termination.

     

    Section
      7.14    Waivers;
      Remedies.
      The
      conditions to Acacia’s obligation to consummate the Distribution are for the
      sole benefit of Acacia and may be waived in writing by Acacia in whole or in
      part in Acacia’s sole discretion. No failure or delay on the part of either
      Acacia or CombiMatrix in exercising any right, power or privilege hereunder
      will
      operate as a waiver thereof, nor will any waiver on the part of either Acacia
      or
      CombiMatrix of any right, power or privilege hereunder operate as a waiver
      of
      any other right, power or privilege hereunder, nor will any single or partial
      exercise of any right, power or privilege hereunder preclude any other or
      further exercise thereof or the exercise of any other right, power or privilege
      hereunder. Subject to Section 7.05, the rights and remedies herein provided
      are cumulative and are not exclusive of any rights or remedies which the parties
      may otherwise have at law or in equity.

     

    Section
      7.15    Further
      Assurances.
      From
      time to time after the Time of Distribution, as and when requested by either
      party hereto, the other party shall execute and deliver, or cause to be executed
      and delivered, all such documents and instruments and shall take, or cause
      to be
      taken, all such actions as the requesting party may reasonably request to
      consummate the transactions contemplated by the Separation
      Agreements.

     

    Section
      7.16    Counterparts.
      This
      Agreement may be executed in separate counterparts, each such counterpart being
      deemed to be an original instrument, and all such counterparts will together
      constitute the same agreement. This Agreement may be executed and delivered
      by
      telecopier with the same force and effect as if it were a manually executed
      and
      delivered counterpart.

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    Section
      7.17    Performance.
      Acacia
      will cause to be performed and hereby guarantees the performance of all actions,
      agreements and obligations set forth herein to be performed by any Acacia
      Subsidiary. CombiMatrix will cause to be performed and hereby guarantees the
      performance of all actions, agreements and obligations set forth herein to
      be
      performed by any CombiMatrix Subsidiary.

     

    Section
      7.18    Interpretation.
      Any
      reference herein to any federal, state, local, or foreign law shall be deemed
      also to refer to all rules and regulations promulgated thereunder, unless the
      context requires otherwise. For the purposes of this Agreement, (a) words
      in the singular shall be held to include the plural and vice
      versa
      and
      words of one gender shall be held to include the other gender as the context
      requires, (b) the terms “hereof”, “herein”, and “herewith” and words of
      similar import shall, unless otherwise stated, be construed to refer to this
      Agreement as a whole and not to any particular provision of this Agreement
      and
      (c) the word “including” and words of similar import when used in this
      Agreement shall mean “including, without limitation”.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK.]

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

    [Signature
      page to Distribution Agreement]

     

    IN
      WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
      duly
      authorized officers of the parties as of the date first hereinabove
      written.

     

    
      	 	
              ACACIA
                RESEARCH CORPORATION

               

               

               

              By:
                /s/ Paul Ryan                    

               
                Name: Paul
                Ryan

               
Title: Chief
                Executive Officer,

               

            
	 	
               

              COMBIMATRIX
                CORPORATION

              
                 

                 

                 

                By:
                  /s/ Amit Kumar                    

              

               
                Name: Amit
                Kumar

               
Title: Chief
                Executive Officer

            

    

    

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

    Schedule
      1.01(a)

     

    Acacia
      Liabilities

     

     

    Audio/Video
      Enhancement and Synchronization Technology

     

    Image
      Resolution Enhancement Technology

     

    
      	·  	
              IP
                Innovation, LLC and Technology Licensing Corporation v. Lexmark
                International, Inc. United States District Court for the Northern
                District
                of Illinois. Filed 10/23/02. Case No.
                1:02-cv-07611.

            

    

     

    
      	·  	
              New
                Medium Technologies, LLC and AV Technologies, LLC v. Barco NV, Miranda
                Technologies, LG Philips LCD, Toshiba Corporation, Toshiba America
                Consumer Products, L.L.C., LG Electronics, Inc., and Syntax-Brillian
                Corporation. United States District Court for the Northern District
                of
                Illinois. Filed 9/29/05. Case No. 1:05-cv-05620.
                

            

    

     

    Broadcast
      Data Retrieval Technology

     

    
      	·  	
              Broadcast
                Data Retrieval Corporation v. Sirius Satellite Radio, Inc. Transferred
                to
                United States District Court for the Southern District of New York
                7/6/06.
                Case No. 1:06-cv-05135.

            

    

     

    Computer
      Memory Cache Coherency Technology

     

    
      	·  	
              Computer
                Cache Coherency Corporation v. VIA Technologies, Inc., Via Technologies,
                Inc. (USA) and Intel Corporation. United States District Court for
                the
                Northern District of California. Filed 12/2/04. Case No. 5:05-cv-01668.
                

            

    

     

    Credit
      Card Fraud Control Technology

     

    
      	·  	
              Ingenio
                Inc. v. Acacia Patent Acquisition Corporation and Acacia Research
                Corporation. United States District Court for the Northern District
                of
                California. Filed 10/13/06. Case No.
                3:06-cv-06423.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Credit
      Card Fraud Protection Technology

     

    
      	·  	
              Financial
                Systems Innovation, LLC and Paul N. Ware v. Gap, Inc., Racetrac Petroleum,
                Inc. and The Kroger Company. United States District Court for the
                Northern
                District of Georgia. Filed 3/3/04. Case No.
                4:04-cv-00065.

            

    

     

    
      	·  	
              Financial
                Systems Innovation, LLC and Paul N. Ware v. Williams-Sonoma, Inc.,
                Linens
                N Things, Inc. and Costco Wholesale Corporation. United States District
                Court for the Northern District of Texas. Filed 6/30/04. Case No.
                4:04-cv-00479.

            

    

     

    
      	·  	
              Financial
                Systems Innovation, LLC and Paul N. Ware v. Circuit City Stores,
                Inc.,
                Officemax Incorporated, Staples, Inc., Cracker Barrel Old Country
                Store,
                Inc., Fry’s Electronics, Inc., and Rite Aid Corporation. United States
                District Court for the Northern District of Georgia. Filed 7/19/05.
                Case
                No. 4:05-cv-00156. 

            

    

     

    
      	·  	
              Reinalt-Thomas
                Corporation, dba Discount Tire Corporation, v. Acacia Research
                Corporation, Paul N. Ware and Financial Systems Innovation, LLC.
                United
                States District Court for the District of Arizona. Filed 10/27/05.
                Case
                No. 2:05-cv-03459. 

            

    

     

    
      	·  	
              Financial
                Systems Innovation, LLC and Paul Ware v. Discount Tire Company of
                Georgia,
                Inc. and Reinalt-Thomas Corporation, dba Discount Tire Company. United
                States District Court for the Northern District of Georgia. Filed
                11/21/05. Case No. 4:05-cv-00252.

            

    

     

    
      	·  	
              Lone
                Star Steakhouse and Saloon, Inc. v. Acacia Technologies group and
                Financial Systems Innovation, LLC. United States District Court for
                the
                District of Kansas. Filed 8/5/05. Case No.
                6:05-cv-01249.

            

    

     

    Computing
      Device Performance Technology

     

    
      	·  	
              Computer
                Acceleration Corporation vs. Microsoft Corporation. United States
                District
                Court for the Eastern District of Texas. Filed 7/6/06. Case No.
                9:06-cv-0140. 

            

    

     

    Data
      Encryption Technology 

     

    
      	·  	
              Data
                Encryption Corporation v. Microsoft Corporation and Dell Computer
                Corporation. United States District Court for the Central District
                of
                California. On appeal to the U.S. Court of Appeals for the Federal
                Court.
                Lower Court Case No. 2:05-cv-05531.

            

    

     

    Digital
      Media Transmission Technology

     

    In
      accordance with the Transfer Order issued February 24, 2005, by the Judicial
      Panel on Multidistrict Litigation, all of the following Digital Media
      Transmission Technology cases have been transferred to the Northern District
      of
      California. The lead case number is 5:05-cv-01114.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	·  	
              Acacia
                Media Technologies Corporation v. Comcast Cable Communications, LLC,
                Charter Communications, Inc., The DirectTV Group, Inc., Echostar
                Communications Corporation, Cox Communications, Inc., Hospitality
                Network,
                Inc. (a wholly owned subsidiary of Cox that supplies hotel on-demand
                TV
                services), Mediacom, LLC, Armstrong Group, Arvig Communication Systems,
                Block Communications, Inc., Cable America Corporation, Cable One,
                Inc.,
                Cannon Valley Communications, Inc., East Cleveland Cable TV and
                Communications, LLC, Loretel Cablevision, Massillon Cable TV, Inc.,
                Mid-Continent Media, Inc., NPG Cable, Inc., Savage Communications,
                Inc.,
                Sjoberg's Cablevision, Inc., US Cable Holdings LP, and Wide Open
                West,
                LLC, Time Warner Cable, Cablevision Systems Corporation, Insight
                Communications Company, Cebridge Communications and Bresnan
                Communications.

            

    

     

    
      	·  	
              Acacia
                Media Technologies Corporation v. New Destiny Internet Group, Inc.,
                Audio
                Communications Inc., VS Media Inc., Ademia Multimedia, LLC, International
                Web Innovations, Inc., Offendale Commercial BV, Ltd., Adult Entertainment
                Broadcast Network, Cybertrend, Inc., Lightspeed Media Corporation,
                Adult
                Revenue Services, Innovative Ideas International, AskCS.com, Game
                Link,
                Inc., Club Jenna, Inc., Cybernet Ventures, Inc., ACMP, LLC, Global
                AVS,
                Inc. d/b/a DrewNet, and National A-1 Advertising.
                

            

    

     

    High
      Resolution Optics Technology

     

    
      	·  	
              Theodore
                Whitney and High Resolution Optics Corporation v. The United States.
                United States Court of Federal Claims. Filed 8/23/06. Case No.
                1:06-cv-00601. 

            

    

     

    Interactive
      Television Technology

     

    
      	·  	
              Broadcast
                Innovation, LLC and IO Research, Ltd. v. Charter Communications,
                Inc.
                United States District Court for the District of Colorado. Case No.
                1:03-cv-02223. On appeal to the U.S. Court of Appeals for the Federal
                Court from 9/28/04 to 11/21/05. Remanded to the U. S. District Court
                for
                further proceedings on 11/21/05. 

            

    

     

    
      	·  	
              Broadcast
                Innovation, LLC v. Echostar Communications Corporation. United States
                District Court for the District of Colorado. Filed 11/9/01. Case
                No.
                1:01-cv-02201. 

            

    

     

    Laptop
      Connectivity Technology

     

    
      	·  	
              Computer
                Docking Station Corporation v. Dell, Inc., Gateway, Inc., Toshiba
                America,
                Inc., and Toshiba America Information Systems, Inc.. United States
                District Court for the Western District of Wisconsin. Filed 1/17/06.
                Case
                No. 06-c-0032-c

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Micromesh
      Technology

     

    
      	·  	
              Micromesh
                Technology Corporation v. American Recreation Productions, Inc.,
                and
                American Recreation Products, Inc., dba Kelty. United States District
                Court for the Northern District of California. Filed 9/27/06. Case
                No.
                3:06-cv-06030.

            

    

     

    
      	·  	
              Micromesh
                Technology Corporation v. Columbia Sportswear Company. United States
                District Court for the Northern District of California. Filed 9/27/06.
                Case No.3:06-cv-06031. 

            

    

     

    
      	·  	
              Micromesh
                Technology Corporation v. Red Wing Shoe Company and Red Wing Shoe
                Company,
                dba Vasque. United States District Court for the Eastern District
                of
                Texas. Filed 10/4/06. Case No.
                2:06-cv-00421.

            

    

     

    
      	·  	
              Micromesh
                Technology Corporation v. VF Corporation, VF Corporation, dba JanSport,
                VF
                Outdoor, Inc., dba The North Face. United States District Court for
                the
                Eastern District of Texas. Filed 10/4/06. Case No.
                2:06-cv-00422.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Microprocessor
      Enhancement Technology

     

    
      	·  	
              Microprocessor
                Enhancement Corporation and Michael H. Branigin v. Texas Instruments,
                Incorporated. United States District Court for the Central District
                of
                California. Filed 4/7/05. Case No.
                8:05-cv-00323.

            

    

     

    
      	·  	
              Microprocessor
                Enhancement Corporation and Michael H. Branigin v. Intel Corporation.
                United States District Court for the Central District of California.
                Filed
                8/3/05. Case No. 2:05-cv-05667.

            

    

     

    Multi-Dimensional
      Bar Code Technology

     

    
      	·  	
              Cognex
                Corporation v. VCode Holdings, Inc., VData LLC, Acacia Research
                Corporation, and Veritec Inc. United States District Court for the
                District of Minnesota. Filed 3/13/06. Case No.
                0:06-cv-01040.

            

    

     

    
      	·  	
              VData
                LLC and VCode Holdings, Inc. v. Aetna, Inc., PNY Technologies Inc.,
                and
                Merchant’s Credit Guide Co. United States District Court for the District
                of Minnesota. Filed 5/8/06. Case No. 0:06-cv-01701.
                

            

    

     

    Peer
      to Peer Communications Technology

     

    
      	·  	
              Peer
                Communications Corporation v. Skype Technologies SA, Skype, Inc.,
                and
                eBay, Inc. United States District Court for the Eastern District
                of Texas.
                Filed 8/22/06. Case No.
                6:06-cv-00370.

            

    

     

    Product
      Activation Technology

     

    
      	·  	
              Product
                Activation Corporation v. Abbyy USA Software House, Inc., Adobe Systems
                Incorporated, Autodesk, Inc. United States District Court for the
                Eastern
                District of Texas. Filed 8/14/06 Case No. 2:06-cv-00326.
                

            

    

     

    Resource
      Scheduling Technology

     

    
      	·  	
              Epic
                Systems Corporation v. Acacia Research Corporation and Resource Scheduling
                Corporation. United States District Court for the District of Delaware.
                Filed 4/19/06. Case No. 1:06-cv-00255.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Spreadsheet
      Automation Technology

     

    
      	·  	
              Spreadsheet
                Automation Corporation v. Microsoft Corporation. United States District
                Court for the Eastern District of Texas. Filed 3/28/05. Case No.
                2:05-cv-00127. 

            

    

     

    User
      Activated Internet Advertising Technology

     

    
      	·  	
              InternetAd
                Systems, LLC v. Turner Broadcasting System, Inc., Freerealtime.com,
                Inc.,
                Knight Ridder Digital, Homestore, Inc., Condenet, Inc. and Tribune
                Company. United States District Court for the Northern District of
                Texas.
                Filed 6/15/06. Case No. 3:06-cv-01063.

            

    

     

    
      	·  	
              InternetAd
                Systems, LLC v. Opodo Limited, Amadeus Global Travel Distribution
                S.A.,
                Amadeus North America, LLC, and Opentable, Inc. United States District
                Court for the Northern District of Texas. Filed 6/19/06. Case No.
                3:06-cv-01084. 

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      1.01(b)

     

    Bylaws

     

    AMENDED
      AND RESTATED BYLAWS

     

    OF

     

    COMBIMATRIX
      CORPORATION

     

    

     

    a
      Delaware corporation

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    AMENDED
      AND RESTATED BYLAWS

     

    OF

     

    COMBIMATRIX
      CORPORATION

     

    ARTICLE
      1

     

    OFFICES

     

    Section
      1.1    Registered
      Office.

     

    The
      registered office of the corporation in the State of Delaware shall be in the
      City of Wilmington, County of New Castle.

     

    Section
      1.2    Other
      Offices.

     

    The
      corporation may also have and maintain an office or principal place of business,
      or offices at such other places, both within and without the State of Delaware
      as the Board of Directors may from time to time determine or the business of
      the
      corporation may require.

     

    ARTICLE
      2

     

    STOCKHOLDERS’
      MEETINGS

     

    Section
      2.1    Place
      of Meetings.

     

    (a)    Meetings
      of stockholders may be held at such place, either within or without this State,
      as may be designated by or in the manner provided in these bylaws or, if not
      so
      designated, as determined by the Board of Directors. The Board of Directors
      may,
      in its sole discretion, determine that the meeting shall not be held at any
      place, but may instead be held solely by means of remote communication as
      authorized by paragraph (b) of this Section
      2.1.

     

    (b)    If
      authorized by the Board of Directors in its sole discretion, and subject to
      such
      guidelines and procedures as the Board of Directors may adopt, stockholders
      and
      proxyholders not physically present at a meeting of stockholders may, by means
      of remote communication:

     

    (1)    Participate
      in a meeting of stockholders; and

     

    (2)    Be
      deemed
      present in person and vote at a meeting of stockholders whether such meeting
      is
      to be held at a designated place or solely by means of remote communication,
      provided that (A) the corporation shall implement reasonable measures to verify
      that each person deemed present and permitted to vote at the meeting by means
      of
      remote communication is a stockholder or proxyholder, (B) the corporation shall
      implement reasonable measures to provide such stockholders and proxyholders
      a
      reasonable opportunity to participate in the meeting and to vote on matters
      submitted to the stockholders, including an opportunity to read or hear the
      proceedings of the meeting substantially concurrently with such proceedings,
      and
      (C) if any stockholder or proxyholder votes or takes other action at the meeting
      by means of remote communication, a record of such vote or other action shall
      be
      maintained by the corporation.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    (c)    For
      purposes of this Section
      2.1,
“remote
      communication” shall include (1) telephone or other voice communications
      and (2) electronic mail or other form of written or visual electronic
      communications, provided that the requirements of the Delaware General
      Corporation Law are satisfied.

     

    Section
      2.2    Annual
      Meetings.

     

    The
      annual meetings of the stockholders of the corporation, for the purpose of
      election of directors and for such other business as may lawfully come before
      it, shall be held on such date and at such time as may be designated from time
      to time by the Board of Directors, or, if not so designated, then at 10:00
      a. m.
      on May 31 in each year if a business day and not a legal holiday, and, if a
      legal holiday, at the same hour and place on the next succeeding business day
      not a holiday.

     

    Section
      2.3    Special
      Meetings.

     

    Special
      Meetings of the stockholders of the corporation may be called, for any purpose
      or purposes, by the Chairman of the Board, the President or the Board of
      Directors at any time. 

     

    Section
      2.4    Notice
      of Meetings.

     

    (a)    Except
      as
      otherwise provided by law or the Certificate of Incorporation, written notice
      of
      each meeting of stockholders, specifying the place, if any, date and hour and
      purpose or purposes of the meeting, and the means of remote communication,
      if
      any, by which stockholders and proxyholders may be deemed to be present in
      person and vote at such meeting, shall be given not less than 10 nor more than
      60 days before the date of the meeting to each stockholder entitled to vote
      thereat, directed to his address as it appears upon the books of the
      corporation; except that where the matter to be acted on is a merger or
      consolidation of the Corporation or a sale, lease or exchange of all or
      substantially all of its assets, such notice shall be given not less than 20
      nor
      more than 60 days prior to such meeting.

     

    (b)    If
      at any
      meeting action is proposed to be taken which, if taken, would entitle
      shareholders fulfilling the requirements of section 262(d) of the Delaware
      General Corporation Law to an appraisal of the fair value of their shares,
      the
      notice of such meeting shall contain a statement of that purpose and to that
      effect and shall be accompanied by a copy of that statutory
      section.

     

    (c)    When
      a
      meeting is adjourned to another time or place, notice need not be given of
      the
      adjourned meeting if the time, place, if any, thereof, and the means of remote
      communication, if any, by which stockholders and proxyholders may be deemed
      to
      be present in person and vote at such adjourned meeting, are announced at the
      meeting at which the adjournment is taken unless the adjournment is for more
      than thirty days, or unless after the adjournment a new record date is fixed
      for
      the adjourned meeting, in which event a notice of the adjourned meeting shall
      be
      given to each stockholder of record entitled to vote at the
      meeting.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (d)    Notice
      of
      the time, place and purpose of any meeting of stockholders may be waived in
      writing, either before or after such meeting, and, to the extent permitted
      by
      law, will be waived by any stockholder by his attendance thereat, in person
      or
      by proxy. Any stockholder so waiving notice of such meeting shall be bound
      by
      the proceedings of any such meeting in all respects as if due notice thereof
      had
      been given.

     

    (e)  Without
      limiting the manner by which notice otherwise may be given effectively to
      stockholders, any notice to stockholders given by the corporation under any
      provision of Delaware General Corporation Law, the certificate of incorporation,
      or these bylaws shall be effective if given by a form of electronic
      transmission. Notice given pursuant to this subparagraph (e) shall be deemed
      given: (1) if by facsimile telecommunication, when directed to a number at
      which
      the stockholder has consented to receive notice; (2) if by electronic mail,
      when
      directed to an electronic mail address at which the stockholder has consented
      to
      receive notice; (3) if by a posting on an electronic network together with
      separate notice to the stockholder of such specific posting, upon the later
      of
      (A) such posting and (B) the giving of such separate notice; and (4) if by
      any
      other form of electronic transmission, when directed to the stockholder. An
      affidavit of the secretary or an assistant secretary or of the transfer agent
      or
      other agent of the corporation that the notice has been given by a form of
      electronic transmission shall, in the absence of fraud, be prima facie evidence
      of the facts stated therein. For purposes of these bylaws, “electronic
      transmission” means any form of communication, not directly involving the
      physical transmission of paper, that creates a record that may be retained,
      retrieved and reviewed by a recipient thereof, and that may be directly
      reproduced in paper form by such a recipient through an automated
      process.

     

    Section
      2.5    Quorum
      and Voting.

     

    (a)    At
      all
      meetings of stockholders except where otherwise provided by law, the Certificate
      of Incorporation or these Bylaws, the presence, in person or by proxy duly
      authorized, of the holders of a majority of the outstanding shares of stock
      entitled to vote shall constitute a quorum for the transaction of business.
      Shares, the voting of which at said meeting have been enjoined, or which for
      any
      reason cannot be lawfully voted at such meeting, shall not be counted to
      determine a quorum at said meeting. In the absence of a quorum, any meeting
      of
      stockholders may be adjourned, from time to time, by vote of the holders of
      a
      majority of the shares represented thereat, but no other business shall be
      transacted at such meeting. At such adjourned meeting at which a quorum is
      present or represented, any business may be transacted which might have been
      transacted at the original meeting. The stockholders present at a duly called
      or
      convened meeting at which a quorum is present may continue to transact business
      until adjournment, notwithstanding the withdrawal of enough stockholders to
      leave less than a quorum.

     

    (b)    Except
      as
      otherwise provided by law, the Certificate of Incorporation or these Bylaws,
      all
      action taken by the holders of a majority of the voting power represented at
      any
      meeting at which a quorum is present shall be valid and binding upon the
      corporation.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    Section
      2.6  Voting
      Rights.

     

    (a)    Except
      as
      otherwise provided by law, only persons in whose names shares entitled to vote
      stand on the stock records of the corporation on the record date for determining
      the stockholders entitled to vote at said meeting shall be entitled to vote
      at
      such meeting. Shares standing in the names of two or more persons shall be
      voted
      or represented in accordance with the determination of the majority of such
      persons, or, if only one of such persons is present in person or represented
      by
      proxy, such person shall have the right to vote such shares and such shares
      shall be deemed to be represented for the purpose of determining a
      quorum.

     

    (b)    Every
      person entitled to vote or to execute consents shall have the right to do so
      either in person or by an agent or agents authorized by a written proxy executed
      by such person or his duly authorized agent, which proxy shall be filed with
      the
      Secretary of the corporation at or before the meeting at which it is to be
      used.
      Said proxy so appointed need not be a stockholder. No proxy shall be voted
      on
      after three (3) years from its date unless the proxy provides for a longer
      period. Unless and until voted, every proxy shall be revocable at the pleasure
      of the person who executed it or of his legal representatives or assigns, except
      in those cases where an irrevocable proxy permitted by statute has been
      given.

     

    (c)    Without
      limiting the manner in which a stockholder may authorize another person or
      persons to act for him as proxy pursuant to subsection (b)
      of this
      section, the following shall constitute a valid means by which a stockholder
      may
      grant such authority:

     

    (1)    A
      stockholder may execute a writing authorizing another person or persons to
      act
      for him as proxy. Execution may be accomplished by the stockholder or his
      authorized officer, director, employee or agent signing such writing or causing
      his or her signature to be affixed to such writing by any reasonable means
      including, but not limited to, by facsimile signature.

     

    (2)    A
      stockholder may authorize another person or persons to act for him as proxy
      by
      transmitting or authorizing the transmission of a telephone, telegram,
      cablegram, email or other means of electronic transmission to the person who
      will be the holder of the proxy or to a proxy solicitation firm, proxy support
      service organization or like agent duly authorized by the person who will be
      the
      holder of the proxy to receive such transmission, provided that any such
      telephone, telegram, cablegram, email or other means of electronic transmission
      must either set forth or be submitted with information from which it can be
      determined that the telephone, telegram, cablegram or other electronic
      transmission was authorized by the stockholder. Such authorization can be
      established by the signature of the stockholder on the proxy, either in writing
      or by a signature stamp or facsimile signature, or by a number or symbol from
      which the identity of the stockholder can be determined, or by any other
      procedure deemed appropriate by the inspectors or other persons making the
      determination as to due authorization.

     

    (3)    If
      it is
      determined that such telegrams, cablegrams, emails or other electronic
      transmissions are valid, the inspectors or, if there are no inspectors, such
      other persons making that determination shall specify the information upon
      which
      they relied.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (d)    Any
      copy,
      facsimile telecommunication or other reliable reproduction of the writing or
      transmission created pursuant to subsection (c)
      of this
      section may be substituted or used in lieu of the original writing or
      transmission for any and all purposes for which the original writing or
      transmission could be used, provided that such copy, facsimile telecommunication
      or other reproduction shall be a complete reproduction of the entire original
      writing or transmission.

     

    Section
      2.7    Voting
      Procedures and Inspectors of Elections.

     

    (a)    The
      corporation shall, in advance of any meeting of stockholders, appoint one or
      more inspectors to act at the meeting and make a written report thereof. The
      corporation may designate one or more persons as alternate inspectors to replace
      any inspector who fails to act. If no inspector or alternate is able to act
      at a
      meeting of stockholders, the person presiding at the meeting shall appoint
      one
      or more inspectors to act at the meeting. Each inspector, before entering upon
      the discharge of his duties, shall take and sign an oath faithfully to execute
      the duties of inspector with strict impartiality and according to the best
      of
      his ability.

     

    (b)    The
      inspectors shall (i) ascertain the number of shares outstanding and the voting
      power of each, (ii) determine the shares represented at a meeting and the
      validity of proxies and ballots, (iii) count all votes and ballots,
      (iv) determine and retain for a reasonable period a record of the
      disposition of any challenges made to any determination by the inspectors,
      and
      (v) certify their determination of the number of shares represented at the
      meeting and their count of all votes and ballots. The inspectors may appoint
      or
      retain other persons or entities to assist the inspectors in the performance
      of
      the duties of the inspectors.

     

    (c)    The
      date
      and time of the opening and the closing of the polls for each matter upon which
      the stockholders will vote at a meeting shall be announced at the meeting by
      the
      person presiding over the meeting. The board of directors may adopt by
      resolution such rules and regulations for the conduct of the meeting of
      stockholders as it shall deem appropriate. Except to the extent inconsistent
      with such rules and regulations as adopted by the board of directors, the person
      presiding over any meeting of stockholders shall have the right and authority
      to
      convene and to adjourn the meeting, to prescribe such rules, regulations and
      procedures and to do all such acts as, in the judgment of such presiding person,
      are appropriate for the proper conduct of the meeting. Such rules, regulations
      or procedures, whether adopted by the board of directors or prescribed by the
      presiding person of the meeting, may include, without limitation, the following:
      (i) the establishment of an agenda or order of business for the meeting; (ii)
      rules and procedures for maintaining order at the meeting and the safety of
      those present; (iii) limitations on attendance at or participation in the
      meeting to stockholders of record of the corporation, their duly authorized
      and
      constituted proxies or such other persons as the presiding person of the meeting
      shall determine; (iv) restrictions on entry to the meeting after the time fixed
      for the commencement thereof; and (v) limitations on the time allotted to
      questions or comments by participants. The presiding person at any meeting
      of
      stockholders, in addition to making any other determinations that may be
      appropriate to the conduct of the meeting, shall, if the facts warrant,
      determine and declare to the meeting that a matter or business was not properly
      brought before the meeting and if such presiding person should so determine,
      such presiding person shall so declare to the meeting and any such matter or
      business not properly brought before the meeting shall not be transacted or
      considered. Unless and to the extent determined by the board of directors or
      the
      person presiding over the meeting, meetings of stockholders shall not be
      required to be held in accordance with the rules of parliamentary
      procedure.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (d)    In
      determining the validity and counting of proxies and ballots, the inspectors
      shall be limited to an examination of the proxies, any envelopes submitted
      with
      those proxies, any information provided in accordance with Sections 211(e)
      or
      212(c)(2) of the Delaware General Corporation Law, or any information provided
      pursuant to Section 211(a)(2)(B)(i) or (iii) thereof, ballots and the regular
      books and records of the corporation, except that the inspectors may consider
      other reliable information for the limited purpose of reconciling proxies and
      ballots submitted by or on behalf of banks, brokers, their nominees or similar
      persons which represent more votes than the holder of a proxy is authorized
      by
      the record owner to cast or more votes than the stockholder holds of record.
      If
      the inspectors consider other reliable information for the limited purpose
      permitted herein, the inspectors at the time they make their certification
      pursuant to subsection (b)(v)
      of
      this section shall specify the precise information considered by them including
      the person or persons from whom they obtained the information, when the
      information was obtained, the means by which the information was obtained and
      the basis for the inspectors’ belief that such information is accurate and
      reliable.

     

    Section
      2.8    List
      of Stockholders.

     

    The
      officer who has charge of the stock ledger of the corporation shall prepare
      and
      make, at least ten days before every meeting of stockholders, a complete list
      of
      the stockholders entitled to vote at said meeting, arranged in alphabetical
      order, showing the address of and the number of shares registered in the name
      of
      each stockholder. The corporation need not include electronic mail addresses
      or
      other electronic contact information on such list. Such list shall be open
      to
      the examination of any stockholder for any purpose germane to the meeting for
      a
      period of at least 10 days prior to the meeting: (i) on a reasonably
      accessible electronic network, provided that the information required to gain
      access to such list is provided with the notice of the meeting, or
      (ii) during ordinary business hours at the principal place of business of
      the corporation. In the event that the corporation determines to make the list
      available on an electronic network, the corporation may take reasonable steps
      to
      ensure that such information is available only to stockholders of the
      corporation. If the meeting is to be held at a place, then the list shall be
      produced and kept at the time and place of the meeting during the whole time
      thereof, and may be inspected by any stockholder who is present. If the meeting
      is to be held solely by means of remote communication, then the list shall
      also
      be open to the examination of any stockholder during the whole time of the
      meeting on a reasonably accessible electronic network, and the information
      required to access such list shall be provided with the notice of the
      meeting.

     

    Section
      2.9    Stockholder
      Proposals at Annual Meetings.

     

    At
      an
      annual meeting of the stockholders, only such business shall be conducted as
      shall have been properly brought before the meeting. To be properly brought
      before an annual meeting, business must be specified in the notice of meeting
      (or any supplement thereto) given by or at the direction of the Board of
      Directors, otherwise properly brought before the meeting by or at the direction
      of the Board of Directors, or otherwise properly brought before the meeting
      by a
      stockholder. In addition to any other applicable requirements for business
      to be
      properly brought before an annual meeting by a stockholder, the stockholder
      must
      have given timely notice thereof in writing to the Secretary of the corporation.
      To

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

      be
        timely
        a stockholder’s notice must be delivered to or mailed and received at the
        principal executive offices of the corporation not less than 120 days nor
        more
        than 180 days prior to the date on which the corporation first mailed its
        proxy
        materials for the previous year’s annual meeting of stockholders (or the date on
        which the corporation mails its proxy materials for the current year if during
        the prior year the corporation did not hold an annual meeting or if the date
        of
        the annual meeting was changed more than 30 days from the prior year). A
        stockholder’s notice to the Secretary shall set forth as to each matter the
        stockholder proposes to bring before the annual meeting (i) a brief
        description of the business desired to be brought before the annual meeting
        and
        the reasons for conducting such business at the annual meeting, (ii) the
        name and record address of the stockholder proposing such business,
        (iii) the class and number of shares of the corporation which are
        beneficially owned by the stockholder, and (iv) any material interest of
        the stockholder in such business.

    

     

    Notwithstanding
      anything in the Bylaws to the contrary, no business shall be conducted at the
      annual meeting except in accordance with the procedures set forth in
Section
      2.1
      and this
Section
      2.9,
      provided, however, that nothing in this Section
      2.9
      shall be
      deemed to preclude discussion by any stockholder of any business properly
      brought before the annual meeting in accordance with said
      procedure.

     

    The
      Chairman of an annual meeting shall, if the facts warrant, determine and declare
      to the meeting that business was not properly brought before the meeting in
      accordance with the provisions of Section
      2.1
      and this
Section
      2.9,
      and if
      he should so determine he shall so declare to the meeting, and any such business
      not properly brought before the meeting shall not be transacted.

     

    Nothing
      in this Section
      2.9
      shall
      affect the right of a stockholder to request inclusion of a proposal in the
      corporation’s proxy statement to the extent that such right is provided by an
      applicable rule of the Securities and Exchange Commission.

     

    Section
      2.10    Nominations
      of Persons for Election to the Board of Directors.

     

    In
      addition to any other applicable requirements, only persons who are nominated
      in
      accordance with the following procedures shall be eligible for election as
      directors. Nominations of persons for election to the Board of Directors of
      the
      corporation may be made at a meeting of stockholders by or at the direction
      of
      the Board of Directors, by any nominating committee or person appointed by
      the
      Board of Directors or by any stockholder of the corporation entitled to vote
      for
      the election of directors at the meeting who complies with the notice procedures
      set forth in this Section
      2.10.
      Such
      nominations, other than those made by or at the direction of the Board of
      Directors, shall be made pursuant to timely notice in writing to the Secretary
      of the corporation. To be timely, a stockholder’s notice must be delivered to or
      mailed and received at the principal executive offices of the corporation,
      not
      less than 80 days nor more than 120 days prior to the date on which the
      corporation first mailed its proxy materials for the previous year’s annual
      meeting of shareholders (or the date on which the corporation mails its proxy
      materials for the current year if during the prior year the corporation did
      not
      hold an annual meeting or if the date of the annual meeting

     

    
      
        
        

      

      
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      was
        changed more than 30 days from the prior year). Such stockholder’s notice shall
        set forth (a) as to each person whom the stockholder proposes to nominate
        for election or re-election as a director, (i) the name, age, business
        address and residence address of the person, (ii) the principal occupation
        or employment of the person, (iii) the class and number of shares of the
        corporation which are beneficially owned by the person, and (iv) any other
        information relating to the person that is required to be disclosed in
        solicitations for proxies for election of directors pursuant to Rule 14a
        under the Securities Exchange Act of 1934; and (b) as to the stockholder
        giving the notice, (i) the name and record address of the stockholder, and
        (ii) the class and number of shares of the corporation which are
        beneficially owned by the stockholder. The corporation may require any proposed
        nominee to furnish such other information as may reasonably be required by
        the
        corporation to determine the eligibility of such proposed nominee to serve
        as a
        director of the corporation. No person shall be eligible for election as
        a
        director of the corporation unless nominated in accordance with the procedures
        set forth herein. These provisions shall not apply to nomination of any persons
        entitled to be separately elected by holders of preferred
        stock.

    

     

    The
      Chairman of the meeting shall, if the facts warrant, determine and declare
      to
      the meeting that a nomination was not made in accordance with the foregoing
      procedure, and if he should so determine, he shall so declare to the meeting
      and
      the defective nomination shall be disregarded.

     

    Section
      2.11    Action
      Without Meeting.

     

    Any
      action that is required or permitted to be taken by the stockholders of the
      Corporation at any annual or special meeting of the stockholders may be effected
      by written consent of the stockholders in lieu of a meeting of
      stockholders.

     

    ARTICLE
      3

     

    DIRECTORS

     

    Section
      3.1    Number
      and Term of Office.

     

    The
      number of directors of the corporation shall not be less than five (5) nor
      more
      than nine (9) until changed by amendment of the Certificate of Incorporation
      or
      by a Bylaw amending this Section
      3.1
      duly
      adopted in accordance with ARTICLE
      11
      hereof.
      The exact number of directors shall be fixed from time to time, within the
      limits specified in the Certificate of Incorporation or in this Section
      3.1,
      by the
      Board of Directors or by a bylaw or amendment thereof duly adopted in accordance
      with ARTICLE
      11
      hereof.
      Subject to the foregoing provisions for changing the number of directors, the
      number of directors of the corporation has been fixed at five (5).

     

    Section
      3.2    Powers.

     

    The
      powers of the corporation shall be exercised, its business conducted and its
      property controlled by or under the direction of the Board of
      Directors.

     

    
      
        
        

      

      
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    Section
      3.3    Vacancies.

     

    Vacancies
      and newly created directorships resulting from any increase in the authorized
      number of directors may be filled by a majority of the directors then in office,
      although less than a quorum, or by a sole remaining director, and each director
      so elected shall hold office for the unexpired portion of the term of the
      director whose place shall be vacant and until his successor shall have been
      duly elected and qualified. A vacancy in the Board of Directors shall be deemed
      to exist under this section in the case of the death, removal or resignation
      of
      any director, or if the stockholders fail at any meeting of stockholders at
      which directors are to be elected (including any meeting referred to in
Section
      3.4
      below)
      to elect the number of directors then constituting the whole Board.

     

    Section
      3.4    Resignations
      and Removals.

     

    (a)    Any
      director may resign at any time by delivering his resignation to the Secretary
      in writing or by electronic transmission, such resignation to specify whether
      it
      will be effective at a particular time, upon receipt by the Secretary or at
      the
      pleasure of the Board of Directors. If no such specification is made it shall
      be
      deemed effective at the pleasure of the Board of Directors. When one or more
      directors shall resign from the Board effective at a future date, a majority
      of
      the directors then in office, including those who have so resigned, shall have
      power to fill such vacancy or vacancies, the vote thereon to take effect when
      such resignation or resignations shall become effective, and each director
      so
      chosen shall hold office for the unexpired portion of the term of the director
      whose place shall be vacated and until his successor shall have been duly
      elected and qualified.

     

    (b)    At
      a
      special meeting of stockholders called for the purpose in the manner hereinabove
      provided, the Board of Directors or any individual director may be removed
      from
      office, with or without cause, and a new director or directors elected by a
      vote
      of stockholders holding a majority of the outstanding shares entitled to vote
      at
      an election of directors.

     

    Section
      3.5    Meetings.

     

    (a)    The
      annual meeting of the Board of Directors shall be held immediately after the
      annual stockholders’ meeting and at the place where such meeting is held or at
      the place announced by the Chairman at such meeting. No notice of an annual
      meeting of the Board of Directors shall be necessary, and such meeting shall
      be
      held for the purpose of electing officers and transacting such other business
      as
      may lawfully come before it.

     

    (b)    Except
      as
      hereinafter otherwise provided, regular meetings of the Board of Directors
      shall
      be held in the office of the corporation required to be maintained pursuant
      to
Section
      1.2
      of
ARTICLE
      1
      hereof.
      Regular meetings of the Board of Directors may also be held at any place, within
      or without the State of Delaware, which has been designated by resolutions
      of
      the Board of Directors or the written consent of all directors.

     

    (c)    Special
      meetings of the Board of Directors may be held at any time and place within
      or
      without the State of Delaware whenever called by the Chairman of the Board
      or,
      if there is no Chairman of the Board, by the President, or by any of the
      directors.

     

    
      
        
        

      

      
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    (d)    Written
      notice of the time and place of all regular and special meetings of the Board
      of
      Directors shall be delivered personally to each director or sent by telegram
      or
      facsimile transmission or other form of electronic transmission at least
      24 hours before the start of the meeting, or sent by first class mail at
      least 120 hours before the start of the meeting. Notice of any meeting may
      be waived in writing at any time before or after the meeting and will be waived
      by any director by attendance thereat.

     

    Section
      3.6    Quorum
      and Voting.

     

    (a)    A
      quorum
      of the Board of Directors shall consist of a majority of the exact number of
      directors fixed from time to time in accordance with Section
      3.1
      of
ARTICLE
      3
      of these
      Bylaws, but not less than one; provided, however, at any meeting whether a
      quorum be present or otherwise, a majority of the directors present may adjourn
      from time to time until the time fixed for the next regular meeting of the
      Board
      of Directors, without notice other than by announcement at the
      meeting.

     

    (b)    At
      each
      meeting of the Board at which a quorum is present, all questions and business
      shall be determined by a vote of a majority of the directors present, unless
      a
      different vote be required by law, the Certificate of Incorporation, or these
      Bylaws.

     

    (c)    Any
      member of the Board of Directors, or of any committee thereof, may participate
      in a meeting by means of conference telephone or other communication equipment
      by means of which all persons participating in the meeting can hear each other,
      and participation in a meeting by such means shall constitute presence in person
      at such meeting.

     

    (d)    The
      transactions of any meeting of the Board of Directors, or any committee thereof,
      however called or noticed, or wherever held, shall be as valid as though had
      at
      a meeting duly held after regular call and notice if a quorum be present and
      if,
      either before or after the meeting, each of the directors not present shall
      sign
      a written waiver of notice, or a consent to holding such meeting, or an approval
      of the minutes thereof. All such waivers, consents or approvals shall be filed
      with the corporate records or made a part of the minutes of the
      meeting.

     

    Section
      3.7    Action
      Without Meeting.

     

    Unless
      otherwise restricted by the Certificate of Incorporation or these Bylaws, any
      action required or permitted to be taken at any meeting of the Board of
      Directors or of any committee thereof may be taken without a meeting, if all
      members of the Board or of such committee, as the case may be, consent thereto
      in writing or by electronic transmission, and such writing or writings or
      electronic transmission or transmissions are filed with the minutes of
      proceedings of the Board or committee. Such filing shall be in paper form if
      the
      minutes are maintained in paper form and shall be in electronic form if the
      minutes are maintained in electronic form.

     

    
      
        
        

      

      
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    Section
      3.8    Fees
      and Compensation.

     

    Directors
      and members of committees may receive such compensation, if any, for their
      services, and such reimbursement for expenses, as may be fixed or determined
      by
      resolution of the Board of Directors.

     

    Section
      3.9    Committees.

     

    (a)    Executive
      Committee:
      The
      Board of Directors may appoint an Executive Committee of not less than one
      member, each of whom shall be a director. The Executive Committee, to the extent
      permitted by law, shall have and may exercise when the Board of Directors is
      not
      in session all powers of the Board in the management of the business and affairs
      of the corporation, except such committee shall not have the power or authority
      to amend these Bylaws or to approve or recommend to the stockholders any action
      which must be submitted to stockholders for approval under the General
      Corporation Law.

     

    (b)    Other
      Committees: The
      Board
      of Directors may, from time to time appoint such other committees as may be
      permitted by law. Such other committees appointed by the Board of Directors
      shall have such powers and perform such duties as may be prescribed by the
      resolution or resolutions creating such committee, but in no event shall any
      such committee have the powers denied to the Executive Committee in these
      Bylaws.

     

    (c)    Term:
      The
      members of all committees of the Board of Directors shall serve a term
      coexistent with that of the Board of Directors which shall have appointed such
      committee. The Board, subject to the provisions of subsections (a)
      or (b) of this Section
      3.8,
      may at
      any time increase or decrease the number of members of a committee or terminate
      the existence of a committee; provided that no committee shall consist of less
      than one member. The membership of a committee member shall terminate on the
      date of his death or voluntary resignation, but the Board may at any time for
      any reason remove any individual committee member and the Board may fill any
      committee vacancy created by death, resignation, removal or increase in the
      number of members of the committee. The Board of Directors may designate one
      or
      more directors as alternate members of any committee, who may replace any absent
      or disqualified member at any meeting of the committee, and, in addition, in
      the
      absence or disqualification of any member of a committee, the member or members
      thereof present at any meeting and not disqualified from voting, whether or
      not
      he or they constitute a quorum, may unanimously appoint another member of the
      Board of Directors to act at the meeting in the place of any such absent or
      disqualified member.

     

    (d)    Meetings:
      Unless
      the Board of Directors shall otherwise provide, regular meetings of the
      Executive Committee or any other committee appointed pursuant to this
Section
      3.8
      shall be
      held at such times and places as are determined by the Board of Directors,
      or by
      any such committee, and when notice thereof has been given to each member of
      such committee, no further notice of such regular meetings need be given
      thereafter; special meetings of any such committee may be held at the principal
      office of the corporation required to be maintained pursuant to Section
      1.2
      of
ARTICLE
      1
      hereof;
      or at any place which has been designated from time to time by resolution of
      such committee or by written consent of all members thereof, and may be called
      by any director who is a member of such committee upon written notice to the
      members of such committee of the time and place of

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

      such
        special meeting given in the manner provided for the giving of written notice
        to
        members of the Board of Directors of the time and place of special meetings
        of
        the Board of Directors. Notice of any special meeting of any committee may
        be
        waived in writing at any time after the meeting and will be waived by any
        director by attendance thereat. A majority of the authorized number of members
        of any such committee shall constitute a quorum for the transaction of business,
        and the act of a majority of those present at any meeting at which a quorum
        is
        present shall be the act of such committee.

    

     

    ARTICLE
      4

     

    OFFICERS

     

    Section
      4.1    Officers
      Designated.

     

    The
      officers of the corporation shall be a Chief Executive Officer, who shall be
      the
      President of the corporation, a Chief Financial Officer, who shall be the
      Treasurer of the corporation, a Secretary and a Chief Operating Officer. The
      Board of Directors or the Chief Executive Officer may also appoint a Chairman
      of
      the Board, one or more Vice-Presidents, assistant secretaries, assistant
      treasurers, and such other officers and agents with such powers and duties
      as it
      or he shall deem necessary. The order of the seniority of the Vice- Presidents
      shall be in the order of their nomination unless otherwise determined by the
      Board of Directors. The Board of Directors may assign such additional titles
      to
      one or more of the officers as they shall deem appropriate. Any one person
      may
      hold any number of offices of the corporation at any one time unless
      specifically prohibited therefrom by law. The salaries and other compensation
      of
      the officers of the corporation shall be fixed by or in the manner designated
      by
      the Board of Directors.

     

    Section
      4.2    Tenure
      and Duties of Officers.

     

    (a)    General:
      All
      officers shall hold office at the pleasure of the Board of Directors and until
      their successors shall have been duly elected and qualified, unless sooner
      removed. Any officer elected or appointed by the Board of Directors may be
      removed at any time by the Board of Directors. If the office of any officer
      becomes vacant for any reason, the vacancy may be filled by the Board of
      Directors. Nothing in these Bylaws shall be construed as creating any kind
      of
      contractual right to employment with the corporation.

     

    (b)    Duties
      of the Chairman of the Board of Directors: The
      Chairman of the Board of Directors (if there be such an officer appointed)
      when
      present shall preside at all meetings of the stockholders and the Board of
      Directors. The Chairman of the Board of Directors shall perform such other
      duties and have such other powers as the Board of Directors shall designate
      from
      time to time.

     

    (c)    Duties
      of Chief Executive Officer (President):
      The
      Chief Executive Officer shall be the President of the corporation and shall
      preside at all meetings of the stockholders and at all meetings of the Board
      of
      Directors, unless the Chairman of the Board of Directors has been appointed
      and
      is present. The Chief Executive Officer shall perform such other duties and
      have
      such other powers as the Board of Directors shall designate from time to
      time.

     

    
      
        
        

      

      
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    (d)    Duties
      of Chief Financial Officer (Treasurer):
      The
      Chief Financial Officer shall be the Treasurer of the corporation. The Chief
      Financial Officer shall keep or cause to be kept the books of account of the
      corporation in a thorough and proper manner, and shall render statements of
      the
      financial affairs of the corporation in such form and as often as required
      by
      the Board of Directors or the Chief Executive Officer. The Chief Financial
      Officer, subject to the order of the Board of Directors, shall have the custody
      of all funds and securities of the corporation. The Chief Financial Officer
      shall perform all other duties commonly incident to his office and shall perform
      such other duties and have such other powers as the Board of Directors or the
      Chief Executive Officer shall designate from time to time. The Chief Executive
      Officer may direct any assistant treasurer to assume and perform such duties
      in
      the absence or disability of the Chief Financial Officer, and each assistant
      treasurer shall perform such other duties and have such other powers as the
      Board of Directors or the Chief Executive Officer shall designate from time
      to
      time.

     

    (e)    Duties
      of Secretary:
      The
      Secretary shall attend all meetings of the stockholders and of the Board of
      Directors and any committee thereof, and shall record all acts and proceedings
      thereof in the minute book of the corporation, which may be maintained in either
      paper or electronic form. The Secretary shall give notice, in conformity with
      these Bylaws, of all meetings of the stockholders and of all meetings of the
      Board of Directors and any Committee thereof requiring notice. The Secretary
      shall perform such other duties and have such other powers as the Board of
      Directors shall designate from time to time. The Chief Executive Officer may
      direct any assistant secretary to assume and perform the duties of the Secretary
      in the absence or disability of the Secretary, and each assistant secretary
      shall perform such other duties and have such other powers as the Board of
      Directors or the Chief Executive Officer shall designate from time to
      time.

     

    (f)    Duties
      of Chief Operating Officer.
      The
      Chief Operating Officer shall perform all duties commonly incident to his office
      and shall perform such other duties and have such other powers as the Board
      of
      Directors or the Chief Executive Officer shall designate from time to
      time.

     

    ARTICLE
      5

     

    EXECUTION
      OF CORPORATE INSTRUMENTS, AND

    VOTING
      OF SECURITIES OWNED BY THE CORPORATION

     

    Section
      5.1    Execution
      of Corporate Instruments.

     

    (a)    The
      Board
      of Directors may in its discretion determine the method and designate the
      signatory officer or officers, or other person or persons, to execute any
      corporate instrument or document, or to sign the corporate name without
      limitation, except where otherwise provided by law, and such execution or
      signature shall be binding upon the corporation.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    (b)    nless
      otherwise specifically determined by the Board of Directors or otherwise
      required by law, formal contracts of the corporation, promissory notes, deeds
      of
      trust, mortgages and other evidences of indebtedness of the corporation, and
      other corporate instruments or documents requiring the corporate seal, and
      certificates of shares of stock owned by the corporation, shall be executed,
      signed or endorsed by the Chairman of the Board (if there be such an officer
      appointed) or by the President; such documents may also be executed by any
      Vice-President and by the Secretary or Treasurer or any assistant secretary
      or
      assistant treasurer. All other instruments and documents requiring the corporate
      signature but not requiring the corporate seal may be executed as aforesaid
      or
      in such other manner as may be directed by the Board of Directors.

     

    (c)    All
      checks and drafts drawn on banks or other depositaries on funds to the credit
      of
      the corporation or in special accounts of the corporation shall be signed by
      such person or persons as the Board of Directors shall authorize so to
      do.

     

    (d)    Execution
      of any corporate instrument may be effected in such form, either manual,
      facsimile or electronic signature, as may be authorized by the Board of
      Directors.

     

    Section
      5.2    Voting
      of Securities Owned by Corporation.

     

    All
      stock
      and other securities of other corporations owned or held by the corporation
      for
      itself or for other parties in any capacity shall be voted, and all proxies
      with
      respect thereto shall be executed, by the person authorized so to do by
      resolution of the Board of Directors or, in the absence of such authorization,
      by the Chairman of the Board (if there be such an officer appointed), or by
      the
      President, or by any Vice-President.

     

    ARTICLE
      6

     

    SHARES
      OF STOCK

     

    Section
      6.1    Form
      and Execution of Certificates.

     

    The
      shares of the corporation shall be represented by certificates, provided that
      the Board of Directors may provide by resolution or resolutions that some or
      all
      of any or all classes or series of its stock shall be uncertificated shares.
      Any
      such resolution shall not apply to shares represented by a certificate until
      such certificate is surrendered to the corporation. Certificates for the shares
      of stock of the corporation shall be in such form as is consistent with the
      Certificate of Incorporation and applicable law. Every holder of stock in the
      corporation shall be entitled to have a certificate signed by, or in the name
      of
      the corporation by, the Chairman of the Board (if there be such an officer
      appointed), or by the President or any Vice-President and by the Treasurer
      or
      assistant treasurer or the Secretary or assistant secretary, certifying the
      number of shares owned by him in the corporation. Any or all of the signatures
      on the certificate may be a facsimile. In case any officer, transfer agent,
      or
      registrar who has signed or whose facsimile signature has been placed upon
      a
      certificate shall have ceased to be such officer, transfer agent, or registrar
      before such certificate is issued, it may be issued with the same effect as
      if
      he were such officer, transfer agent,

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

      or
        registrar at the date of issue. If the corporation shall be authorized to
        issue
        more than one class of stock or more than one series of any class, the powers,
        designations, preferences and relative, participating, optional or other
        special
        rights of each class of stock or series thereof and the qualifications,
        limitations or restrictions of such preferences and/or rights shall be set
        forth
        in full or summarized on the face or back of the certificate which the
        corporation shall issue to represent such class or series of stock, provided
        that, except as otherwise provided in section 202 of the Delaware General
        Corporation Law, in lieu of the foregoing requirements, there may be set
        forth
        on the face or back of the certificate which the corporation shall issue
        to
        represent such class or series of stock, a statement that the corporation
        will
        furnish without charge to each stockholder who so requests the powers,
        designations, preferences and relative, participating, optional or other
        special
        rights of each class of stock or series thereof and the qualifications,
        limitations or restrictions of such preferences and/or
        rights.

    

     

    Section
      6.2    Lost
      Certificates.

     

    The
      Board
      of Directors may direct a new certificate or certificates to be issued in place
      of any certificate or certificates theretofore issued by the corporation alleged
      to have been lost or destroyed, upon the making of an affidavit of that fact
      by
      the person claiming the certificate of stock to be lost or destroyed. When
      authorizing such issue of a new certificate or certificates, the Board of
      Directors may, in its discretion and as a condition precedent to the issuance
      thereof, require the owner of such lost or destroyed certificate or
      certificates, or his legal representative, to indemnify the corporation in
      such
      manner as it shall require and/or to give the corporation a surety bond in
      such
      form and amount as it may direct as indemnity against any claim that may be
      made
      against the corporation with respect to the certificate alleged to have been
      lost or destroyed.

     

    Section
      6.3    Transfers.

     

    Transfers
      of record of shares of stock of the corporation shall be made only upon its
      books by the holders thereof, in person or by attorney duly authorized, and
      upon
      the surrender of a certificate or certificates for a like number of shares,
      properly endorsed.

     

    Section
      6.4    Fixing
      Record Dates.

     

    (a)    In
      order
      that the corporation may determine the stockholders entitled to notice of or
      to
      vote at any meeting of stockholders or any adjournment thereof, the Board of
      Directors may fix a record date, which record date shall not precede the date
      upon which the resolution fixing the record date is adopted by the Board of
      Directors, and which record date shall not be more than 60 nor less than 10
      days
      before the date of such meeting. If no record date is fixed by the Board of
      Directors, the record date for determining stockholders entitled to notice
      of or
      to vote at a meeting of stockholders shall be at the close of business on the
      day next preceding the day on which notice is given, or, if notice is waived,
      at
      the close of business on the day next preceding the date on which the meeting
      is
      held. A determination of stockholders of record entitled notice of or to vote
      at
      a meeting of stockholders shall apply to any adjournment of the meeting;
      provided, however, that the Board of Directors may fix a new record date for
      the
      adjourned meeting.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (b)    In
      order
      that the corporation may determine the stockholders entitled to receive payment
      of any dividend or other distribution or allotment of any rights or the
      stockholders entitled to exercise any rights in respect of any change,
      conversion or exchange of stock, or for the purpose of any other lawful action,
      the Board of Directors may fix a record date, which record date shall not
      precede the date upon which the resolution fixing the record date is adopted,
      and which record date shall be not more than 60 days prior to such action.
      If no
      record date is fixed, the record date for determining stockholders for any
      such
      purpose shall be at the close of business on the day on which the Board of
      Directors adopts the resolution relating thereto.

     

    Section
      6.5    Registered
      Stockholders.

     

    The
      corporation shall be entitled to recognize the exclusive right of a person
      registered on its books as the owner of shares to receive dividends and to
      vote
      as such owner, and shall not be bound to recognize any equitable or other claim
      to or interest in such share or shares on the part of any other person, whether
      or not it shall have express or other notice thereof, except as otherwise
      provided by the laws of Delaware.

     

    ARTICLE
      7

     

    OTHER
      SECURITIES OF THE CORPORATION

     

    All
      bonds, debentures and other corporate securities of the corporation, other
      than
      stock certificates, may be signed by the Chairman of the Board (if there be
      such
      an officer appointed), or the President or any Vice-President or such other
      person as may be authorized by the Board of Directors and the corporate seal
      impressed thereon or a facsimile of such seal imprinted thereon and attested
      by
      the signature of the Secretary or an assistant secretary, or the Treasurer
      or an
      assistant treasurer; provided, however, that where any such bond, debenture
      or
      other corporate security shall be authenticated by the manual signature of
      a
      trustee under an indenture pursuant to which such bond, debenture or other
      corporate security shall be issued, the signature of the persons signing and
      attesting the corporate seal on such bond, debenture or other corporate security
      may be the imprinted facsimile of the signatures of such persons. Interest
      coupons appertaining to any such bond, debenture or other corporate security,
      authenticated by a trustee as aforesaid, shall be signed by the Treasurer or
      an
      assistant treasurer of the corporation, or such other person as may be
      authorized by the Board of Directors, or bear imprinted thereon the facsimile
      signature of such person. In case any officer who shall have signed or attested
      any bond, debenture or other corporate security, or whose facsimile signature
      shall appear thereon has ceased to be an officer of the corporation before
      the
      bond, debenture or other corporate security so signed or attested shall have
      been delivered, such bond, debenture or other corporate security nevertheless
      may be adopted by the corporation and issued and delivered as though the person
      who signed the same or whose facsimile signature shall have been used thereon
      had not ceased to be such officer of the corporation.

     

    
      
        
        

      

      
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    ARTICLE
      8

     

    CORPORATE
      SEAL

     

    The
      corporate seal shall consist of a die bearing the name of the corporation and
      the state and date of its incorporation. Said seal may be used by causing it
      or
      a facsimile thereof to be impressed or affixed or reproduced or
      otherwise.

     

    ARTICLE
      9

     

    INDEMNIFICATION
      OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS

     

    Section
      9.1    Right
      to Indemnification.

     

    Each
      person who was or is a party or is threatened to be made a party to or is
      involved (as a party, witness, or otherwise), in any threatened, pending, or
      completed action, suit, or proceeding, whether civil, criminal, administrative,
      or investigative (hereinafter a “Proceeding”), by reason of the fact that he, or
      a person of whom he is the legal representative, is or was a director, officer,
      employee, or agent of the corporation or is or was serving at the request of
      the
      corporation as a director, officer, employee, or agent of another corporation
      or
      of a partnership, joint venture, trust, or other enterprise, including service
      with respect to employee benefit plans, whether the basis of the Proceeding
      is
      alleged action in an official capacity as a director, officer, employee, or
      agent or in any other capacity while serving as a director, officer, employee,
      or agent (hereafter an “Agent”), shall be indemnified and held harmless by the
      corporation to the fullest extent authorized by the Delaware General Corporation
      Law, as the same exists or may hereafter be amended or interpreted (but, in
      the
      case of any such amendment or interpretation, only to the extent that such
      amendment or interpretation permits the corporation to provide broader
      indemnification rights than were permitted prior thereto) against all expenses,
      liability, and loss (including attorneys’ fees, judgments, fines, ERISA excise
      taxes or penalties, and amounts paid or to be paid in settlement, and any
      interest, assessments, or other charges imposed thereon, and any federal, state,
      local, or foreign taxes imposed on any Agent as a result of the actual or deemed
      receipt of any payments under this Article) reasonably incurred or suffered
      by
      such person in connection with investigating, defending, being a witness in,
      or
      participating in (including on appeal), or preparing for any of the foregoing
      in, any Proceeding (hereinafter “Expenses”); provided,
      however,
      that
      except as to actions to enforce indemnification rights pursuant to Section
      9.3
      of this
      Article, the corporation shall indemnify any Agent seeking indemnification
      in
      connection with a Proceeding (or part thereof) initiated by such person only
      if
      the Proceeding (or part thereof) was authorized by the Board of Directors of
      the
      corporation. The right to indemnification conferred in this Article shall be
      a
      contract right.

     

    Section
      9.2    Authority
      to Advance Expenses.

     

    Expenses
      incurred by an officer or director (acting in his capacity as such) in defending
      a Proceeding shall be paid by the corporation in advance of the final
      disposition of such Proceeding, provided, however, that if required by the
      Delaware General Corporation Law, as amended, such Expenses shall be advanced
      only upon delivery to the corporation of an undertaking by or on behalf of
      such
      director or officer to repay such amount if it shall ultimately be determined
      that he is not entitled to be indemnified by the corporation as authorized
      in
      this Article or otherwise. Expenses incurred by other Agents of the corporation
      (or by the directors or officers not acting in their capacity as such, including
      service with respect to employee benefit plans) may be advanced upon such terms
      and conditions as the Board of Directors deems appropriate. Any obligation
      to
      reimburse the corporation for Expense advances shall be unsecured and no
      interest shall be charged thereon.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    Section
      9.3    Right
      of Claimant to Bring Suit.

     

    If
      a
      claim under Section
      9.1
      or
Section
      9.2
      of this
      Article is not paid in full by the corporation within 60 days after a
      written claim has been received by the corporation, the claimant may at any
      time
      thereafter bring suit against the corporation to recover the unpaid amount
      of
      the claim and, if successful in whole or in part, the claimant shall be entitled
      to be paid also the expense (including attorneys’ fees) of prosecuting such
      claim. It shall be a defense to any such action (other than an action brought
      to
      enforce a claim for expenses incurred in defending a Proceeding in advance
      of
      its final disposition where the required undertaking has been tendered to the
      corporation) that the claimant has not met the standards of conduct that make
      it
      permissible under the Delaware General Corporation Law for the corporation
      to
      indemnify the claimant for the amount claimed. The burden of proving such a
      defense shall be on the corporation. Neither the failure of the corporation
      (including its Board of Directors, independent legal counsel, or its
      stockholders) to have made a determination prior to the commencement of such
      action that indemnification of the claimant is proper under the circumstances
      because he has met the applicable standard of conduct set forth in the Delaware
      General Corporation Law, nor an actual determination by the corporation
      (including its Board of Directors, independent legal counsel, or its
      stockholders) that the claimant had not met such applicable standard of conduct,
      shall be a defense to the action or create a presumption that claimant has
      not
      met the applicable standard of conduct.

     

    Section
      9.4    Provisions
      Nonexclusive.

     

    The
      rights conferred on any person by this Article shall not be exclusive of any
      other rights that such person may have or hereafter acquire under any statute,
      provision of the Certificate of Incorporation, agreement, vote of stockholders
      or disinterested directors, or otherwise, both as to action in an official
      capacity and as to action in another capacity while holding such office. To
      the
      extent that any provision of the Certificate, agreement, or vote of the
      stockholders or disinterested directors is inconsistent with these bylaws,
      the
      provision, agreement, or vote shall take precedence.

     

    Section
      9.5    Authority
      to Insure.

     

    The
      corporation may purchase and maintain insurance to protect itself and any Agent
      against any Expense, whether or not the corporation would have the power to
      indemnify the Agent against such Expense under applicable law or the provisions
      of this Article.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    Section
      9.6    Survival
      of Rights.

     

    The
      rights provided by this Article shall continue as to a person who has ceased
      to
      be an Agent and shall inure to the benefit of the heirs, executors, and
      administrators of such a person.

     

    Section
      9.7    Settlement
      of Claims.

     

    The
      corporation shall not be liable to indemnify any Agent under this Article
      (a) for any amounts paid in settlement of any action or claim effected
      without the corporation’s written consent, which consent shall not be
      unreasonably withheld; or (b) for any judicial award if the corporation was
      not given a reasonable and timely opportunity, at its expense, to participate
      in
      the defense of such action.

     

    Section
      9.8    Effect
      of Amendment.

     

    Any
      amendment, repeal, or modification of this Article shall not adversely affect
      any right or protection of any Agent existing at the time of such amendment,
      repeal, or modification.

     

    Section
      9.9    Subrogation.

     

    In
      the
      event of payment under this Article, the corporation shall be subrogated to
      the
      extent of such payment to all of the rights of recovery of the Agent, who shall
      execute all papers required and shall do everything that may be necessary to
      secure such rights, including the execution of such documents necessary to
      enable the corporation effectively to bring suit to enforce such
      rights.

     

    Section
      9.10   No
      Duplication of Payments.

     

    The
      corporation shall not be liable under this Article to make any payment in
      connection with any claim made against the Agent to the extent the Agent has
      otherwise actually received payment (under any insurance policy, agreement,
      vote, or otherwise) of the amounts otherwise indemnifiable
      hereunder.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      10

     

    NOTICES

     

    Whenever,
      under any provisions of these Bylaws, notice is required to be given to any
      stockholder, the same shall be given either (1) in writing, timely and duly
      deposited in the United States Mail, postage prepaid, and addressed to his
      last known post office address as shown by the stock record of the corporation
      or its transfer agent, or (2) by a means of electronic transmission that
      satisfies the requirements of Section
      2.4(e)
      of these
      Bylaws. Any notice required to be given to any director may be given by either
      of the methods hereinabove stated, except that such notice other than one which
      is delivered personally, shall be sent to such address or (in the case of
      electronic communication) such e-mail address, facsimile telephone number or
      other form of electronic address as such director shall have filed in writing
      or
      by electronic communication with the Secretary of the corporation, or, in the
      absence of such filing, to the last known post office address of such director.
      If no address of a stockholder or director be known, such notice may be sent
      to
      the office of the corporation required to be maintained pursuant to Section
      1.2
      of
ARTICLE
      1
      hereof.
      An affidavit of mailing, executed by a duly authorized and competent employee
      of
      the corporation or its transfer agent appointed with respect to the class of
      stock affected, specifying the name and address or the names and addresses
      of
      the stockholder or stockholders, director or directors, to whom any such notice
      or notices was or were given, and the time and method of giving the same, shall
      be conclusive evidence of the statements therein contained. All notices given
      by
      mail, as above provided, shall be deemed to have been given as at the time
      of
      mailing and all notices given by means of electronic transmission shall be
      deemed to have been given as at the sending time recorded by the electronic
      transmission equipment operator transmitting the same. It shall not be necessary
      that the same method of giving notice be employed in respect of all directors,
      but one permissible method may be employed in respect of any one or more, and
      any other permissible method or methods may be employed in respect of any other
      or others. The period or limitation of time within which any stockholder may
      exercise any option or right, or enjoy any privilege or benefit, or be required
      to act, or within which any director may exercise any power or right, or enjoy
      any privilege, pursuant to any notice sent him in the manner above provided,
      shall not be affected or extended in any manner by the failure of such a
      stockholder or such director to receive such notice. Whenever any notice is
      required to be given under the provisions of the statutes or of the Certificate
      of Incorporation, or of these Bylaws, a waiver thereof in writing signed by
      the
      person or persons entitled to said notice, or a waiver by electronic
      transmission by the person entitled to notice, whether before or after the
      time
      stated therein, shall be deemed equivalent thereto. Whenever notice is required
      to be given, under any provision of law or of the Certificate of Incorporation
      or Bylaws of the corporation, to any person with whom communication is unlawful,
      the giving of such notice to such person shall not be required and there shall
      be no duty to apply to any governmental authority or agency for a license or
      permit to give such notice to such person. Any action or meeting which shall
      be
      taken or held without notice to any such person with whom communication is
      unlawful shall have the same force and effect as if such notice had been duly
      given. In the event that the action taken by the corporation is such as to
      require the filing of a certificate under any provision of the Delaware General
      Corporation Law, the certificate shall state, if such is the fact and if notice
      is required, that notice was given to all persons entitled to receive notice
      except such persons with whom communication is unlawful.

     

    ARTICLE
      11

     

    AMENDMENTS

     

    These
      Bylaws may be repealed, altered or amended or new Bylaws adopted at any meeting
      of the stockholders, either annual or special, by the affirmative vote of 66
      2/3% of the stock entitled to vote at such meeting, unless a larger vote is
      required by these Bylaws or the Certificate of Incorporation. The Board of
      Directors shall also have the authority to repeal, alter or amend these Bylaws
      or adopt new Bylaws (including, without limitation, the amendment of any Bylaws
      setting forth the number of directors who shall constitute the whole Board
      of
      Directors) by written consent or at any annual, regular, or special meeting
      by
      the affirmative vote of a majority of the whole number of directors, subject
      to
      the power of the stockholders to change or repeal such Bylaws and provided
      that
      the Board of Directors shall not make or alter any Bylaws fixing the
      qualifications, classifications, or term of office of directors.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    CERTIFICATE
      OF SECRETARY

     

    The
      undersigned Secretary of Combimatrix Corporation, a Delaware corporation, hereby
      certifies that the foregoing is a full, true and correct copy of the Amended
      and
      Restated Bylaws of said corporation, with all amendments to date of this
      Certificate.

     

    WITNESS
      the signature of the undersigned this ___ day of February, 2006.

     

    

     

     

     

    ________________________________________

    __________________,
      Secretary

     

    
      
        
        

      

      
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    Schedule
      1.01(c)

     

    Certificate
      of Incorporation

     

    AMENDED
      AND RESTATED

    CERTIFICATE
      OF INCORPORATION

    OF

    COMBIMATRIX
      CORPORATION

     

    _____________________,
      2006

     

    CombiMatrix
      Corporation, a corporation organized and existing under the General Corporation
      Law of the State of Delaware DOES HEREBY CERTIFY: 

     

    FIRST:  
      The
      original Certificate of Incorporation of CombiMatrix Corporation was filed
      under
      the name Combi Acquisition Corp. with the Secretary of State of the State of
      Delaware on March 15, 2002.

     

    SECOND:  
      Combi
      Acquisition Corp. merged with and into CombiMatrix Corporation and
      simultaneously changed its name to CombiMatrix Corporation via the filing of
      a
      Certificate of Merger with the Secretary of State of the State of Delaware
      on
      December 13, 2002.

     

    THIRD:   The
      Amended and Restated Certificate of Incorporation of CombiMatrix Corporation
      in
      the form attached hereto as Exhibit
      A
      has been
      duly adopted in accordance with the provisions of Sections 242 and 245 of the
      General Corporation Law of the State of Delaware by the directors and sole
      stockholder of CombiMatrix Corporation.

     

    FOURTH:  
      The
      Amended and Restated Certificate of Incorporation so adopted reads in full
      as
      set forth in Exhibit
      A
      attached
      hereto and is hereby incorporated herein by this reference.

     

    IN
      WITNESS WHEREOF, CombiMatrix Corporation has caused this Certificate to be
      signed by its Chief Financial Officer as of the date first written
      above.

     

    
      	 	
              COMBIMATRIX
                CORPORATION

               

            
	 	
              By:

            	/s/
              Scott Burell
	 	
              Name:

              Title:

            	
              Scott
                Burell

              Chief
                Financial Officer

            
	 	 

    

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    AMENDED
      AND RESTATED CERTIFICATE OF INCORPORATION

    OF

    COMBIMATRIX
      CORPORATION

     

    ARTICLE
      I

    NAME

     

    The
      name
      of the corporation is CombiMatrix Corporation (the "Corporation").

     

    ARTICLE
      II

    ADDRESS
      OF REGISTERED OFFICE;

    NAME
      OF
      REGISTERED AGENT

     

    The
      address of the registered office of the Corporation in the State of Delaware
      is
      Registered Agent Solutions, Inc., 15 E. North Street, City of Dover, County
      of
      Kent, Delaware 19901. The name of its registered agent at that address is
      Registered Agent Solutions, Inc.

     

    ARTICLE
      III

    PURPOSE

     

    The
      purpose of the Corporation is to engage in any lawful act or activity for which
      corporations may be organized under the Delaware General Corporation Law (the
      "DGCL").

     

    ARTICLE
      IV

    CAPITAL
      STOCK

     

    Section
      1.    Authorization.
      The
      total number of shares of all classes of stock that the Corporation is
      authorized to issue is Two Hundred and Ten Million (210,000,000) shares,
      consisting of One Hundred and Eighty Million (180,000,000) shares of Common
      Stock with a par value of $.001 per share, and Thirty Million (30,000,000)
      shares of Preferred Stock with a par value of $.001 per share. Upon the
      effectiveness of this Amended and Restated Certificate of Incorporation, each
      outstanding share of Common Stock of the Corporation shall be split and divided
      into four (4) shares of Common Stock.
      No
      fractional shares shall be recorded in the stock ledger of the Corporation
      as a
      result of the stock split provided for above. Any fractional share (a
“Fractional
      Interest”)
      that
      would otherwise be issuable to a holder of Common Stock (a “Fractional
      Share Holder”)
      shall
      be treated as described in the following sentence: The Fractional Interest
      shall
      be cancelled and the Fractional Share Holder shall be entitled to receive an
      amount in cash equal to the product of the Fractional Interest to which such
      Fractional Share Holder would otherwise have been entitled, multiplied by the
      fair market value of one share of Common Stock immediately following the
      effectiveness of the stock split provided for above, as determined by the Board
      of Directors. Whether or not a Fractional Interest is to be recorded as a result
      of the stock split provided for above shall be determined on the basis of the
      total number of shares of Common Stock held by the record holder at the time
      the
      stock split occurs.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Section
      2.    Preferred
      Stock.
      The
      Preferred Stock may be issued from time to time in one or more series, each
      with
      such distinctive designation as may be stated in the Certificate of
      Incorporation or in any amendment hereto, or in a resolution or resolutions
      providing for the issue of such stock from time to time adopted by the Board
      of
      Directors or a duly authorized committee thereof. The resolution or resolutions
      providing for the issue of shares of a particular series shall fix, subject
      to
      applicable laws and the provisions of the Certificate of Incorporation, for
      each
      such series the number of shares constituting such series and the designation
      and the voting powers, preferences and relative, participating, optional or
      other special rights and the qualifications, limitations or restrictions
      thereof, including, without limiting the generality of the foregoing, such
      provisions as may be desired concerning voting, redemption, dividends,
      dissolution or the distribution of assets, conversion or exchange, and such
      other subjects or matters as may be fixed by the Board of Directors or a duly
      authorized committee thereof under the DGCL. Except as otherwise required by
      law, or as otherwise fixed by resolution or resolutions of the Board of
      Directors with respect to one or more series of Preferred Stock, the entire
      voting power and all voting rights shall be vested exclusively in the Common
      Stock, and each stockholder of the Corporation who at the time possesses voting
      power for any purpose shall be entitled to one vote for each share of such
      stock
      standing in his name on the books of the Corporation.

     

    Section
      3.    Common
      Stock.
      

     

    (a)    Voting
      Rights.
      Except
      as may otherwise be provided in the certificate of incorporation of the
      corporation (including any certificate filed with the Secretary of State of
      the
      State of Delaware establishing the terms of a series of Preferred Stock pursuant
      to the provisions of Article
      IV,
      Section
      2
      hereof)
      or by applicable law, each holder of Common Stock, as such, shall be entitled
      to
      one (1) vote for each share of Common Stock held of record by such holder on
      all
      matters on which stockholders generally are entitled to vote, and no holder
      of
      any series of Preferred Stock, as such, shall be entitled to any voting powers
      in respect thereof. 

     

    (b)    Dividends.
      Subject
      to applicable law and the rights, if any, of the holders of any outstanding
      series of Preferred Stock provided for or fixed pursuant to the provisions
      of
Article
      IV,
      Section
      2
      hereof,
      dividends may be declared and paid on the Common Stock at such times and in
      such
      amounts as the Board of Directors in its discretion shall
      determine.

     

    (c)    Liquidation;
      Dissolution.
      Upon
      the dissolution, liquidation or winding-up of the corporation, subject to
      applicable law and the rights, if any, of the holders of any outstanding series
      of Preferred Stock provided for or fixed pursuant to the provisions of
Article
      IV,
      Section
      2
      hereof,
      the holders of the Common Stock shall be entitled to receive the assets of
      the
      corporation available for distribution to its stockholders ratably in proportion
      to the number of shares of Common Stock held by them. 

     

    ARTICLE
      V

    BOARD
      OF
      DIRECTORS

     

    Section
      1.    Number
      of Directors and Election.
      Subject
      to any rights of holders of the Corporation’s preferred stock, the number of
      directors will be fixed from time to time by action of not less than a majority
      of the directors then in office, but in no event shall the number of directors
      be less than five (5) nor more than nine (9).

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    Section
      2.    Powers
      of the Board of Directors.
      In
      furtherance, and not in limitation, of the powers conferred by the laws of
      the
      State of Delaware, the Board of Directors is expressly authorized to adopt,
      alter, amend and repeal the Bylaws of the Corporation.

     

    Section
      3.    Removal.
      Directors may be removed, with or without cause, only upon the affirmative
      vote
      of holders of at least two-thirds of the voting power of all then outstanding
      shares of stock entitled to vote generally in the election of directors, voting
      together as a single class, subject to any rights of holders of the
      Corporation’s preferred stock; provided, however, that where such action is
      approved by a majority of the directors the affirmative vote of only a majority
      of the holders of all outstanding shares of the Corporation’s common stock will
      be required for approval of such action.

     

    ARTICLE
      VI

    STOCKHOLDER
      ACTIONS

     

    Section
      1.    Meetings
      and Records.
      Meetings of stockholders may be held within or without the State of Delaware,
      as
      the Bylaws of the Corporation may provide. The books of the Corporations may
      be
      kept (subject to the DGCL) outside of the State of Delaware at such place or
      places as may be designated from time to time by the Board of Directors or
      in
      the Bylaws of the Corporation.

     

    Section
      2.    Special
      Meetings.
      Special
      meetings of stockholders may be called at any time by the Board of Directors
      or
      by the Chairman of the Board of Directors, or the President, and may not be
      called by any other person or persons.

     

    Section
      3.    Written
      Consents.
      No
      action that is required or permitted to be taken by the stockholders of the
      Corporation at any annual or special meeting of the stockholders may be effected
      by written consent of the stockholders in lieu of a meeting of
      stockholders.

     

    Section
      4.    Vacancies.
      Subject
      to the rights, if any, of the holders of any outstanding series of Preferred
      Stock as
      provided for or fixed pursuant to the provisions of Article
      IVSection 2
      hereof,
      newly
      created directorships resulting from an increase in the authorized number of
      directors or any vacancies on the Board of Directors resulting from death,
      resignation, retirement, disqualification, removal or other cause shall be
      filled solely and exclusively by the affirmative vote of a majority of the
      remaining directors then in office, even though less than a quorum of the Board
      of Directors. Any director so chosen shall hold office until the next election
      of the class for which such director shall have been chosen and until his or
      her
      successor shall be elected and qualified. No decrease in the number of directors
      shall shorten the term of any incumbent director.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      VII

    LIMITATION
      ON LIABILITY OF DIRECTORS

     

    No
      person
      shall be personally liable to the Corporation or its stockholders for monetary
      damages for breach of fiduciary duty as a director, including without limitation
      for serving on a committee of the Board of Directors, except to the extent
      such
      exemption from liability or limitation thereof is not permitted under the DGCL
      as the same exists or hereafter may be amended. If the DGCL is amended after
      the
      date of the filing of this Certificate of Incorporation to authorize corporate
      action further eliminating or limiting the personal liability of directors,
      then
      the liability of a director of the Corporation shall be eliminated or limited
      to
      the fullest extent permitted by the DGCL as so amended. Any amendment, repeal
      or
      modification of this Article
      VII
      shall
      not adversely affect any right or protection of a director of the Corporation
      existing hereunder with respect to any act or omission occurring prior to such
      amendment, repeal or modification.

     

    ARTICLE
      VIII

    INDEMNIFICATION

     

    The
      Corporation may indemnify to the fullest extent permitted by law any person
      made
      or threatened to be made a party to an action or proceeding, whether criminal,
      civil, administrative or investigative, by reason of the fact that such person,
      his or her testator or intestate is or was a director, officer or employee
      of
      the Corporation or any predecessor of the Corporation or serves or served at
      any
      other enterprise as a director, officer or employee at the request of the
      Corporation or any predecessor to the Corporation. No amendment, repeal or
      modification of this Article
      VIII
      by the
      stockholders shall adversely affect any right or protection of a director of
      the
      Corporation existing by virtue of this Article
      VIII
      at the
      time of such amendment, repeal or modification.

     

    ARTICLE
      IX

    AMENDMENT
      OF CERTIFICATE OF INCORPORATION

     

    The
      Corporation hereby reserves the right from time to time to amend, alter, change
      or repeal any provision contained in the Certificate of Incorporation, and
      other
      provisions authorized by the laws of the State of Delaware at the time in force
      may be added or inserted, in the manner now or hereafter prescribed by law,
      and
      all rights, preferences, and privileges of whatsoever nature conferred upon
      the
      stockholders, directors or any other persons whomsoever by or pursuant to this
      Certificate of Incorporation in its present form or as hereafter amended are
      granted subject to the right reserved in this Article
      IX.

     

    ARTICLE
      X

    CREDITORS

     

    Whenever
      a compromise or arrangement is proposed between this Corporation and its
      creditors or any class of them and/or between this Corporation and its
      stockholders or any class of them, any court of equitable jurisdiction within
      the State of Delaware may, on the application in a summary way of this
      Corporation or of any creditor or stockholder thereof, or on the application
      of
      any receiver or receivers appointed for this Corporation under the provisions
      of
      Section 291 of Title 8 of the Delaware Code or on the application of
      trustees in dissolution or of any receiver or receivers appointed for this
      Corporation under the provisions of Section 279 of Title 8 of the
      Delaware Code order a meeting of the creditors or class of creditors, and/or
      of
      the stockholders or class of stockholders of this Corporation, as the case
      may
      be, to be summoned in such manner as the said court directs. If a majority
      in
      number representing three-fourths in value of the creditors or class of
      creditors, and/or of the stockholders or class of stockholders of this
      Corporation, as the case may be, agree to any compromise or arrangement and
      to
      any reorganization of this Corporation as a consequence of such compromise
      or
      arrangement, the said compromise or arrangement and the said reorganization
      shall, if sanctioned by the court to which the said application has been made,
      be binding on all the creditors or class of creditors, and/or on all the
      stockholders or class of stockholders, of this Corporation, as the case may
      be,
      and also on this Corporation.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Schedule
      1.01(d)

     

    CombiMatrix
      Assets

     

     

    
      	1)  	
              Ownership
                Interest in Advanced Material Sciences,
                Inc.

            

    

     

    
      	2)  	
              Ownership
                Interest in CombiMatrix, K.K.

            

    

     

    
      	3)  	
              Any
                net proceeds received by Acacia from any future settlement or disposition
                of the lawsuit between Acacia Research Corporation and National
                Union

            

    

     

    
      	4)  	
              Any
                net proceeds received by Acacia from the sale of AR-CombiMatrix stock
                as
                the result of a financing event or exercise of an option or warrant
                to
                purchase AR-CombiMatrix stock prior to the Time of
                Distribution

            

    

     

    [end]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      1.01(e)

     

    CombiMatrix
      Liabilities

     

     

    
      	1)  	
              Dent
                / Strathmann matter

            

    

     

    
      	2)  	
              Ragsdale
                matter

            

    

     

    
      	3)  	
              Jeff
                Oster matter

            

    

     

    [end]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      1.01(f)

     

    CombiMatrix
      Property

     

    NONE.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Schedule
      1.01(g)

     

    CombiMatrix
      Subsidiaries

     

    

     

    Advanced
      Materials Sciences, Inc.

     

    CombiMatrix
      International Holdings Corp.

     

    CombiMatrix
      Molecular Diagnostics, Inc.

     

    CombiMatrix
      K.K.

     

    Leuchemix,
      Inc.

     

    

     

    [end]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      2.01(c)

     

    Acacia
      Actions

     

    [to
      be
      attached]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      2.03(a)

     

    Elimination
      of Intercompany Agreements

     

    NONE.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      2.03(b)

     

    Intercompany
      Agreements

     

    NONE.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      2.04

     

    CombiMatrix
      Board of Directors

     

    
      	
              Amit
                Kumar, Ph.D

            
	 
	
              Brooke
                Anderson, Ph.D

            
	 
	
              Thomas
                Akin

            
	 
	
              Rigdon
                Currie 

            
	 
	
              John
                Abeles, MD

            

    

    

     

    [end]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      2.05

     

    Exceptions
      to Acacia Resignations

     

    NONE

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      5.03(a)

     

    CombiMatrix/May
      2003 Warrants

     

    
      	
               

              Warrant
                Date

               

            	
               

              No.
                of Warrant Shares

               

            	
               

              No.
                of Warrant Shares Outstanding

               

            
	
               

              5/20/03

               

            	
               

              67,500

               

            	
               

              67,500

               

            
	
               

              5/20/03

               

            	
               

              45,455

               

            	
               

              45,455

               

            
	
               

              5/20/03

               

            	
               

              170,455

               

            	
               

              170,455

               

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Schedule
      5.03(b)

     

    CombiMatrix/Piper
      2005 Warrants

     

    WARRANT
      LEDGER - MAY 20, 2003 PRIVATE PLACEMENT

     

     

    
      	
               

              Warrant
                No.

               

            	
               

              Warrant
                Date

               

            	
               

              No.
                of Warrant Shares

               

            	
               

              No.
                of Warrant Shares Outstanding

               

            
	
              W-1

               

            	
              9/21/05

               

            	
              6,061

               

            	
              6,061

               

            
	
              W-2

               

            	
              9/21/05

               

            	
              60,606

               

            	
              60,606

               

            
	
              W-3

               

            	
              9/21/05

               

            	
              84,849

               

            	
              84,849

               

            
	
              W-4

               

            	
              9/21/05

               

            	
              60,606

               

            	
              60,606

               

            
	
              W-5

               

            	
              9/21/05

               

            	
              303,030

               

            	
              303,030

               

            
	
              W-6

               

            	
              9/21/05

               

            	
              151,515

               

            	
              151,515

               

            
	
              W-7

               

            	
              9/21/05

               

            	
              75,758

               

            	
              75,758

               

            
	
              W-8

               

            	
              9/21/05

               

            	
              151,515

               

            	
              151,515

               

            
	
              W-9

               

            	
              9/21/05

               

            	
              37,879

               

            	
              37,879

               

            
	
              W-10

               

            	
              9/21/05

               

            	
              20,000

               

            	
              20,000

               

            
	
              W-11

               

            	
              9/21/05

               

            	
              105,000

               

            	
              105,000

               

            
	
              W-12

               

            	
              9/21/05

               

            	
              75,000

               

            	
              75,000

               

            
	
              W-13

               

            	
              9/21/05

               

            	
              113,636

               

            	
              113,636

               

            
	
              W-14

               

            	
              9/21/05

               

            	
              61,250

               

            	
              61,250

               

            
	
              W-15

               

            	
              9/21/05

               

            	
              62,500

               

            	
              62,500

               

            
	
              W-16

               

            	
              9/21/05

               

            	
              121,212

               

            	
              121,212

               

            
	
              W-19

               

            	
              9/21/05

               

            	
              37,879

               

            	
              37,879

               

            
	
              W-20

               

            	
              9/21/05

               

            	
              21,591

               

            	
              21,591

               

            
	
              W-21

               

            	
              9/21/05

               

            	
              3,788

               

            	
              3,788

               

            
	
              W-22

               

            	
              9/21/05

               

            	
              12,500

               

            	
              12,500

               

            
	
              W-23

               

            	
              9/28/06

               

            	
              7,576

               

            	
              7,576

               

            
	
              W-24

               

            	
              9/22/06

               

            	
              22,727

               

            	
              22,727

               

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      5.03(c)

     

    CombiMatrix/Oppenheimer
      Warrants

     

    
      	 	
               

              No.
                of Warrant Shares

               

            	 	
              Warrant
                #

               

            	 	
              Date
                Issued

               

            	 
	 	
              3,529,411

               

            	 	
              WA-001

               

            	 	
              12/13/2006

               

            	 
	 	
              288,000

               

            	 	
              WA-003

               

            	 	
              12/13/2006

               

            	 
	 	
              576,000

               

            	 	
              WA-004

               

            	 	
              12/13/2006

               

            	 
	 	
              288,000

               

            	 	
              WA-005

               

            	 	
              12/13/2006

               

            	 
	 	
              411,764

               

            	 	
              WA-006

               

            	 	
              12/13/2006

               

            	 
	 	
              204,000

               

            	 	
              WA-007

               

            	 	
              12/13/2006

               

            	 
	 	
              390,720

               

            	 	
              WA-008

               

            	 	
              12/13/2006

               

            	 
	 	
              60,960

               

            	 	
              WA-009

               

            	 	
              12/13/2006

               

            	 
	 	
              544,320

               

            	 	
              WA-010

               

            	 	
              12/13/2006

               

            	 
	 	
              300,000

               

            	 	
              WA-011

               

            	 	
              12/13/2006

               

            	 
	 	
              124,560

               

            	 	
              WA-012

               

            	 	
              12/13/2006

               

            	 
	 	
              45,480

               

            	 	
              WA-013

               

            	 	
              12/13/2006

               

            	 
	 	
              1,029,960

               

            	 	
              WA-014

               

            	 	
              12/13/2006

               

            	 
	 	
              28,800

               

            	 	
              WA-015

               

            	 	
              12/13/2006

               

            	 
	 	
              90,000

               

            	 	
              WA-016

               

            	 	
              12/13/2006

               

            	 
	 	
              12,000

               

            	 	
              WA-017

               

            	 	
              12/13/2006

               

            	 
	 	
              120,000

               

            	 	
              WA-018

               

            	 	
              12/13/2006

               

            	 
	 	
              24,000

               

            	 	
              WA-019

               

            	 	
              12/13/2006

               

            	 
	 	
              12,000

               

            	 	
              WA-020

               

            	 	
              12/13/2006

               

            	 
	 	
              12,000

               

            	 	
              WA-021

               

            	 	
              12/13/2006

               

            	 
	 	
              12,000

               

            	 	
              WA-022

               

            	 	
              12/13/2006

               

            	 
	 	
              12,000

               

            	 	
              WA-023

               

            	 	
              12/13/2006

               

            	 
	 	
              6,000

               

            	 	
              WA-024

               

            	 	
              12/13/2006

               

            	 
	 	
              488,416

               

            	 	
              WA-025

               

            	 	
              12/13/2006

               

            	 
	 	
              1,200,000

               

            	 	
              WA-026

               

            	 	
              12/13/2006

               

            	 
	 	
              2,400,000

               

            	 	
              WA-027

               

            	 	
              12/13/2006

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00115-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00115-of-00352.parquet"}]]