Document:

Exhibit
      10.38

     

    LOAN
      AND SECURITY AGREEMENT

     

    Dated
      as of February 20, 2008

     

    between

     

    ASYRMATOS,
      INC.

    a
      Delaware corporation,

    

    as
      “Borrower”,

     

    and

     

    LUMERA
      CORPORATION,

    a
      Delaware corporation,

    

    as
      “Lender”

     

    TABLE
      OF CONTENTS

     

    
      
         

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    
      	 	 	
              Page(s)

            
	
              ARTICLE  
                1INTERPRETATION

            	
              1

            
	
              1.1

            	
              Definitions

            	
              1

            
	
              ARTICLE 2 
                THE
                TERM LOAN

            	
              1

            
	
              2.1

            	
              Term
                Loan

            	
              1

            
	
              2.2

            	
              Note
                Evidencing Loans; Repayment

            	
              1

            
	
              2.3

            	
              Interest

            	
              1

            
	
              2.4

            	
              Interest
                Rate Calculation

            	
              1

            
	
              2.5

            	
              Default
                Interest

            	
              1

            
	
              2.6

            	
              Late
                Charges

            	
              1

            
	
              2.7

            	
              Lender's
                Records

            	
              2

            
	
              2.8

            	
              Grant
                of Security Interests; Filing of Financing Statements.

            	
              2

            
	
              2.9

            	
              Prepayments

            	
              2

            
	
              ARTICLE 3 
                REPRESENTATIONS
                AND WARRANTIES

            	
              2

            
	
              3.1

            	
              Due
                Organization

            	
              2

            
	
              3.2

            	
              Authorization,
                Validity and Enforceability

            	
              3

            
	
              3.3

            	
              Compliance
                with Applicable Laws

            	
              3

            
	
              3.4

            	
              No
                Conflict

            	
              3

            
	
              3.5

            	
              Litigation,
                Claims or Proceedings

            	
              3

            
	
              3.6

            	
              Correctness
                of Financial Statements

            	
              3

            
	
              3.7

            	
              No
                Subsidiaries

            	
              3

            
	
              3.8

            	
              Environmental
                Matters

            	
              3

            
	
              3.9

            	
              No
                Event of Default

            	
              3

            
	
              3.10

            	
              Full
                Disclosure

            	
              3

            
	
              3.11

            	
              Specific
                Representations Regarding Collateral.

            	
              4

            
	
              3.12

            	
              Copyrights,
                Patents, Trademarks and Licenses.

            	
              4

            
	
              3.13

            	
              Survival

            	
              5

            
	
              ARTICLE 4 
                CONDITIONS
                PRECEDENT

            	
              5

            
	
              4.1

            	
              Conditions
                to the Loan

            	
              5

            

    

     

    
      
        
          
            Table
              of
              Contents - i

          

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    
      	
              ARTICLE 5 
                AFFIRMATIVE
                COVENANTS

            	
              6

            
	
              5.1

            	
              Notice
                to Lender

            	
              6

            
	
              5.2

            	
              Financial
                Statements

            	
              7

            
	
              5.3

            	
              Existence

            	
              7

            
	
              5.4

            	
              Insurance

            	
              7

            
	
              5.5

            	
              Accounting
                Records

            	
              8

            
	
              5.6

            	
              Compliance
                With Laws

            	
              8

            
	
              5.7

            	
              Taxes
                and Other Liabilities

            	
              8

            
	
              5.8

            	
              Special
                Collateral Covenants.

            	
              8

            
	
              ARTICLE 6 
                NEGATIVE
                COVENANTS

            	
              9

            
	
              6.1

            	
              Indebtedness

            	
              9

            
	
              6.2

            	
              Liens

            	
              9

            
	
              6.3

            	
              Dividends

            	
              9

            
	
              6.4

            	
              Changes/Mergers

            	
              10

            
	
              6.5

            	
              Sales
                of Assets

            	
              10

            
	
              6.6

            	
              Loans/Investments

            	
              10

            
	
              6.7

            	
              Transactions
                With Related Persons

            	
              11

            
	
              6.8

            	
              Other
                Business

            	
              11

            
	
              6.9

            	
              Financing
                Statements and Other Actions

            	
              11

            
	
              6.10

            	
              Compliance

            	
              11

            
	
              6.11

            	
              Other
                Deposit and Securities Accounts

            	
              11

            
	
              6.12

            	
              Prepayment
                of Indebtedness

            	
              11

            
	
              ARTICLE 7 
                EVENTS
                OF DEFAULT

            	
              12

            
	
              7.1

            	
              Events
                of Default; Acceleration

            	
              12

            
	
              7.2

            	
              Remedies
                Upon Default

            	
              13

            
	
              7.3

            	
              Sale
                of Collateral

            	
              13

            
	
              7.4

            	
              Borrower's
                Obligations Upon Default

            	
              14

            
	
              ARTICLE 8 
                SPECIAL
                COLLATERAL PROVISIONS

            	
              14

            
	
              8.1

            	
              Compromise
                and Collection

            	
              14

            
	
              8.2

            	
              Performance
                of Borrower's Obligations

            	
              14

            
	
              8.3

            	
              Power
                of Attorney

            	
              14

            

    

     

    
      
        
          Table
            of
            Contents - ii

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    
      	
              8.4

            	
              Authorization
                for Lender to Take Certain Action

            	
              15

            
	
              8.5

            	
              Application
                of Proceeds

            	
              16

            
	
              8.6

            	
              Deficiency

            	
              16

            
	
              8.7

            	
              Lender
                Transfer

            	
              16

            
	
              8.8

            	
              Lender's
                Duties.

            	
              16

            
	
              8.9

            	
              Termination
                of Security Interests

            	
              17

            
	
              ARTICLE 9 
                GENERAL
                PROVISIONS

            	
              17

            
	
              9.1

            	
              Notices

            	
              17

            
	
              9.2

            	
              Binding
                Effect

            	
              17

            
	
              9.3

            	
              No
                Waiver

            	
              17

            
	
              9.4

            	
              Rights
                Cumulative

            	
              17

            
	
              9.5

            	
              Unenforceable
                Provisions

            	
              17

            
	
              9.6

            	
              Accounting
                Terms

            	
              18

            
	
              9.7

            	
              Indemnification;
                Exculpation

            	
              18

            
	
              9.8

            	
              Reimbursement

            	
              18

            
	
              9.9

            	
              Execution
                in Counterparts

            	
              18

            
	
              9.10

            	
              Entire
                Agreement

            	
              18

            
	
              9.11

            	
              Governing
                Law and Jurisdiction.

            	
              19

            
	
              9.12

            	
              Waiver
                of Jury Trial

            	
              19

            
	
              ARTICLE 10 
                DEFINITIONS

            	
              19

            

    

     

    
      
        
          Table
            of
            Contents - iii

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    LOAN
      AND SECURITY AGREEMENT

    

    The
      Borrower and Lender
      hereby enter into a transaction whereby the Lender will make certain funds
      available to the Borrower pursuant to the terms and conditions set forth in
      this
      document (the “Agreement”).

     

    Accordingly,
      the parties agree as follows:

     

    
      
        ARTICLE 1INTERPRETATION

      

    

     

    1.1 Definitions.
      The
      terms defined in Article 10 will have the meanings therein specified for
      purposes of this Agreement.

     

    
      
        ARTICLE 2
          THE
          TERM
          LOAN

      

    

     

    2.1 Term
      Loan.
      Subject
      to the terms and conditions of this Agreement, Lender agrees to make a term
      loan
      (the “Loan”) to Borrower in an aggregate principal amount not exceeding $
      500,000 (the “Loan Amount”). The Loan is not a revolving credit commitment, and
      Borrower does not have the right to repay and reborrow hereunder.
      The
      proceeds of the Loan shall be used by the Borrower for development of a
      millimeter wave communication system and corporate general
      purposes..

     

    2.2 Note
      Evidencing Loans; Repayment.
      The
      Loan shall be evidenced by a Note payable to the order of Lender, in the total
      principal amount of the Loan. Principal and interest of each Loan shall be
      payable at the times set forth in the Note and regularly scheduled payments
      thereof.

     

    2.3 Interest.
      Except
      as otherwise specified in the applicable Note, Basic Interest on the outstanding
      principal balance of the Loan shall accrue daily from the date hereof. If the
      outstanding principal balance of such Loan is not paid at maturity, interest
      shall accrue at the Default Rate until paid in full, as further set forth
      herein.

     

    2.4 Interest
      Rate Calculation.
      Basic
      Interest, along with charges and fees under this Agreement and any Loan
      Document, shall be calculated for actual days elapsed on the basis of a 360-day
      year, which results in higher interest, charge or fee payments than if a 365-day
      year were used. In no event shall Borrower be obligated to pay Lender interest,
      charges or fees at a rate in excess of the highest rate permitted by applicable
      law from time to time in effect.

     

    2.5 Default
      Interest.
      Any
      unpaid payments of principal or interest with respect to the Loan shall bear
      interest from the Maturity Date at the Basic Interest rate plus
      three
      percent (3.00%) per annum, until paid in full, whether before or after judgment
      (the “Default
      Rate”).
      Borrower shall pay such interest on demand.

     

    2.6 Late
      Charges.
      If
      Borrower is late in making any payment of principal or interest under this
      Agreement by more than fifteen (15) days, Borrower agrees to pay a late charge
      of five percent (5%) of the installment due, but not less than fifty dollars
      ($50.00) for any one such delinquent payment. This late charge may be charged
      by
      Lender for the purpose of defraying the expenses incidental to the handling
      of
      such delinquent amounts. Borrower acknowledges that such late charge represents
      a reasonable sum considering all of the circumstances existing on the date
      of
      this Agreement and represents a fair and reasonable estimate of the costs that
      will be sustained by Lender due to the failure of Borrower to make timely
      payments. Borrower further agrees that proof of actual damages would be costly
      and inconvenient. Such late charge shall be paid without prejudice to the right
      of Lender to collect any other amounts provided to be paid or to declare a
      default under this Agreement or any of the other Loan Documents or from
      exercising any other rights and remedies of Lender.

     

    
      
         

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    2.7 Lender's
      Records.
      Principal, Basic Interest and all other sums owed under any Loan Document shall
      be evidenced by entries in records maintained by Lender for such purpose. Each
      payment on and any other credits with respect to principal, Basic Interest
      and
      all other sums outstanding under any Loan Document shall be evidenced by entries
      in such records. Absent manifest error, Lender's records shall be conclusive
      evidence thereof.

     

    2.8 Grant
      of Security Interests; Filing of Financing Statements. 

     

    (a) To
      secure
      the timely payment and performance of all of Borrower's Obligations to Lender,
      Borrower hereby grants to Lender continuing security interests in all of the
      Collateral. In connection with the foregoing, Borrower authorizes Lender to
      prepare and file any financing statements describing the Collateral without
      otherwise obtaining the Borrower’s signature or consent with respect to the
      filing of such financing statements.

     

    (b) Borrower
      is and shall remain absolutely and unconditionally liable for the performance
      of
      its obligations under the Loan Documents, including, without limitation, any
      deficiency by reason of the failure of the Collateral to satisfy all amounts
      due
      Lender under any of the Loan Documents.

     

    (c) All
      Collateral pledged by Borrower under this Agreement shall secure the timely
      payment and performance of all Obligations under this Agreement, the Notes
      and
      the other Loan Documents. Except as expressly provided in this Agreement, no
      Collateral pledged under this Agreement shall be released until such time as
      all
      Obligations under this Agreement and the other Loan Documents have been
      satisfied and paid in full.

     

    2.9 Prepayments.
      The
      Loan
      may be prepaid in
      whole
      or in part, without penalty, provided that the Borrower must provide 10 days
      prior written notice of such prepayment and the Lender shall have the
      opportunity to convert as set forth in Section 3 of the Note before such
      prepayment. 

     

    
      
        ARTICLE 3
          REPRESENTATIONS
          AND WARRANTIES

      

    

     

    Borrower
      represents and warrants that, except as set forth in any schedule of exceptions
      executed by the parties, as of the Closing Date:

     

    3.1 Due
      Organization.
      Borrower is a corporation duly organized and validly existing in good standing
      under the laws of the jurisdiction of its incorporation, and is duly qualified
      to conduct business and is in good standing in each other jurisdiction in which
      its business is conducted or its properties are located, except where the
      failure to be so qualified would not reasonably be expected to have a Material
      Adverse Effect.
      Borrower’s federal tax identification numbers are as set forth on
      Schedule 3.1.

     

    
      
         

      

      
        2

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    3.2 Authorization,
      Validity and Enforceability.
      The
      execution, delivery and performance of all Loan Documents executed by Borrower
      are within Borrower's powers, have been duly authorized, and are not in conflict
      with Borrower's articles of incorporation or by-laws, or the terms of any
      charter or other organizational document of Borrower, as amended from time
      to
      time; and all such Loan Documents constitute valid and binding obligations
      of
      Borrower, enforceable in accordance with their terms (except as may be limited
      by bankruptcy, insolvency and similar laws affecting the enforcement of
      creditors' rights in general, and subject to general principles of
      equity).

     

    3.3 Compliance
      with Applicable Laws.
      Borrower has complied with all licensing, permit and fictitious name
      requirements necessary to lawfully conduct the business in which it is engaged,
      and to any sales, leases or the furnishing of services by Borrower, including
      without limitation those requiring consumer or other disclosures, the
      noncompliance with which would have a Material Adverse Effect.

     

    3.4 No
      Conflict.
      The
      execution, delivery, and performance by Borrower of all Loan Documents are
      not
      in conflict with any law, rule, regulation, order or directive, or any
      indenture, agreement, or undertaking to which Borrower is a party or by which
      Borrower may be bound or affected.

     

    3.5 Litigation,
      Claims or Proceedings.
      There
      is no litigation, tax claim, proceeding or dispute pending, or, to the knowledge
      of Borrower, threatened against or affecting Borrower, its property or the
      conduct of its business.

     

    3.6 Correctness
      of Financial Statements.
      Borrower's financial statements which have been delivered to Lender fairly
      and
      accurately reflect Borrower's financial condition in accordance with GAAP as
      of
      the latest date of such financial statements; and, since that date there has
      been no Material Adverse Change. 

     

    3.7 No
      Subsidiaries.
      Borrower is not a majority owner of or in a control relationship with any other
      business entity.

     

    3.8 Environmental
      Matters.
      To its
      knowledge after reasonable inquiry, Borrower has concluded that Borrower is
      in
      compliance with Environmental Laws, except to the extent a failure to be in
      such
      compliance could not reasonably be expected to have a Material Adverse
      Effect.

     

    3.9 No
      Event of Default.
      No
      Default or Event of Default has occurred and is continuing.

     

    3.10 Full
      Disclosure.
      None of
      the representations or warranties made by Borrower in the Loan Documents as
      of
      the date such representations and warranties are made or deemed made, and none
      of the statements contained in any exhibit, report, statement or certificate
      furnished by or on behalf of Borrower in connection with the Loan Documents
      (including disclosure materials delivered by or on behalf of Borrower to Lender
      prior to the Closing Date or pursuant to Section 5.2 hereof), contains any
      untrue statement of a material fact or omits any material fact required to
      be
      stated therein or necessary to make the statements made therein, in light of
      the
      circumstances under which they are made, not misleading as of the time when
      made
      or delivered.

     

    
      
         

      

      
        3

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    3.11 Specific
      Representations Regarding Collateral. 

     

    (a) Title.
      Except
      for the security interests created by this Agreement and Permitted Liens, (i)
      Borrower is and will be the unconditional legal and beneficial owner of the
      Collateral, and (ii) the Collateral is subject to no Liens, rights or defenses
      of others. There exist no prior assignments or encumbrances of record with
      the
      U.S. Patent and Trademark Office or U.S. Copyright Office affecting any
      Collateral in favor of any third party other than Lender.

     

    (b) Rights
      to Payment.
      The
      names of the obligors, amount owing to Borrower, due dates and all other
      information with respect to the Rights to Payment are and will be correctly
      stated in all material respects in all Records relating to the Rights to
      Payment. Borrower further represents and warrants, to its knowledge, that each
      Person appearing to be obligated on a Right to Payment has authority and
      capacity to contract and is bound as it appears to be.

     

    (c) Location
      of Collateral.
      Borrower's chief executive office, Inventory, Records, Equipment, and any other
      offices or places of business are located at the address(es) shown on
      Schedule 3.11(c).

     

    (d) Business
      Names.
      Other
      than its full corporate name, Borrower has not conducted business using any
      trade names or fictitious business names.

     

    (e) Accounts.
      Borrower’s primary operating account and wire transfer instructions for such
      account is as set forth on Schedule 3.11(e). Borrower maintains additional
      accounts as described on Schedule 3.11(e).

     

    3.12 Copyrights,
      Patents, Trademarks and Licenses. 

     

    (a) Borrower
      owns or is licensed or otherwise has the right to use all of the patents,
      trademarks, service marks, trade names, copyrights, contractual franchises,
      authorizations and other similar rights that are reasonably necessary for the
      operation of its business, without conflict with the rights of any other
      Person.

     

    (b) To
      Borrower's knowledge, no slogan or other advertising device, product, process,
      method, substance, part or other material now employed, or now contemplated
      to
      be employed, by Borrower infringes upon any rights held by any other
      Person.

     

    (c) No
      claim
      or litigation regarding any of the foregoing is pending or, to Borrower's
      knowledge, threatened, and no patent, invention, device, application, principle
      or any statute, law, rule, regulation, standard or code is pending or proposed
      which, in either case, could reasonably be expected to have a Material Adverse
      Effect.

     

    
      
         

      

      
        4

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    3.13 Survival.
      The
      representations and warranties of Borrower as set forth in this Agreement
      survive the execution and delivery of this Agreement.

     

    
      
        ARTICLE 4
          CONDITIONS
          PRECEDENT

      

    

     

    4.1 Conditions
      to the Loan.
      The
      obligation of Lender to the Loan hereunder is subject to the fulfillment of
      the
      following conditions and to the receipt by Lender of the documents described
      below, duly executed and in form and substance satisfactory to Lender and its
      counsel:

     

    (a) No
      Default.
      No
      Default or Event of Default has occurred and is continuing or will result from
      the making of any such Loan, and the representations and warranties of Borrower
      contained in Article 3 of this Agreement are true and correct as of the Closing
      Date.

     

    (b) No
      Material Adverse Change.
      No
      event has occurred that has had or could reasonably be expected to have a
      Material Adverse Change.

     

    (c) Resolutions.
      A
      certified copy of the resolutions of the Board of Directors of Borrower
      authorizing the execution, delivery and performance by Borrower of the Loan
      Documents.

     

    (d) Incumbency
      and Signatures.
      A
      certificate of the secretary of Borrower certifying the names of the officer
      or
      officers of Borrower authorized to sign the Loan Documents, together with a
      sample of the true signature of each such officer.

     

    (e) Legal
      Opinion.
      The
      opinion of legal counsel for Borrower as to such matters as Lender may
      reasonably request, including the matters covered by Sections 3.1, 3.2, 3.4
      and
      3.5 hereof.

     

    (f) Articles
      and By-Laws.
      Certified copies of the Articles of Incorporation and By-Laws of Borrower,
      as
      amended through the Closing Date.

     

    (g) This
      Agreement.
      Original counterparts of this Agreement, with all schedules completed and
      attached thereto, and disclosing such information as is acceptable to
      Lender.

     

    (h) Financing
      Statements.
      Filing
      copies (or other evidence of filing satisfactory to Lender and its counsel)
      of
      such UCC financing statements, collateral assignments, account control
      agreements, and termination statements, with respect to the Collateral as Lender
      shall request.

     

    (i) Insurance
      Certificates.
      Insurance certificates showing Lender as loss payee or additional
      insured.

     

    
      
         

      

      
        5

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    (j) Lien
      Searches.
      UCC
      lien, judgment, bankruptcy and tax lien searches of Borrower from such
      jurisdictions or offices as Lender may reasonably request, all as of a date
      reasonably satisfactory to Lender and its counsel.

     

    (k) Good
      Standing Certificate.
      A
      certificate of status or good standing of Borrower as of a date acceptable
      to
      Lender from the jurisdiction of Borrower's organization and any foreign
      jurisdictions where Borrower is qualified to do business.

     

    (l) Other
      Documents.
      Such
      other documents and instruments as Lender may reasonably request to effectuate
      the intents and purposes of this Agreement.

     

    (m) Financial
      Projections.
      Borrower shall have delivered to Lender Borrower’s business plan and/or
      financial projections or forecasts as most recently approved by Borrower’s Board
      of Directors.

     

    
      
        ARTICLE 5
          AFFIRMATIVE
          COVENANTS

      

    

     

    During
      the term of this Agreement and until its performance of all Obligations,
      Borrower will:

     

    5.1 Notice
      to Lender.
      Promptly give written notice to Lender of:

     

    (a) Any
      litigation or administrative or regulatory proceeding affecting Borrower where
      the amount claimed against Borrower is $50,000 or more, or where the granting
      of
      the relief requested could have a Material Adverse Effect; or of the acquisition
      by Borrower of any commercial tort claim, including brief details of such claim
      and such other information as Lender may reasonably request to enable Lender
      to
      better perfect its Lien in such commercial tort claim as
      Collateral.

     

    (b) Any
      substantial dispute which may exist between Borrower and any governmental or
      regulatory authority.

     

    (c) The
      occurrence of any Default or any Event of Default.

     

    (d) Any
      change in the location of any of Borrower's places of business or Collateral
      at
      least thirty (30) days in advance of such change, or of the establishment of
      any
      new, or the discontinuance of any existing, place of business.

     

    (e) Any
      dispute or default by Borrower or any other party under any joint venture,
      partnering, distribution, cross-licensing, strategic alliance, collaborative
      research or manufacturing, license or similar agreement which could reasonably
      be expected to have a Material Adverse Effect, but not including a dispute
      between the Borrower and the Lender.

     

    (f) Any
      other
      matter which has resulted or might reasonably result in a Material Adverse
      Change.

     

    
      
         

      

      
        6

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    5.2 Financial
      Statements.
      Deliver
      to Lender or cause to be delivered to Lender, in form and detail satisfactory
      to
      Lender the following financial and other information, which Borrower warrants
      shall be accurate and complete in all material respects:

     

    (a) Monthly
      Financial Statements.
      As soon
      as available but no later than twenty (20) days after the end of each month,
      Borrower's balance sheet as of the end of such period, and Borrower's income
      statement for such period and for that portion of Borrower's financial reporting
      year ending with such period, prepared in accordance with GAAP and attested
      by a
      responsible financial officer of Borrower as being complete and correct and
      fairly presenting Borrower's financial condition and the results of Borrower's
      operations. 

     

    (b) Year-End
      Financial Statements.
      As soon
      as available but no later than one hundred twenty (120) days after the end
      of
      the financial reporting year, a complete copy of Borrower's audit report for
      each financial reporting year of Borrower (or, if Borrower’s Board of Directors
      has waived the requirement for an audit with respect to a particular financial
      reporting year, then an unaudited report for such year), which shall include
      balance sheet, income statement, statement of changes in equity and statement
      of
      cash flows for such year, prepared in accordance with GAAP and certified by
      an
      independent certified public accountant selected by Borrower and reasonably
      satisfactory to Lender (the “Accountant”).
      The
      Accountant's certification shall not be qualified or limited due to a restricted
      or limited examination by the Accountant of any material portion of Borrower's
      records or otherwise.

     

    (c) Government
      Required Reports; Press Releases.
      Promptly after sending, issuing, making available, or filing, copies of all
      statements released to any news media for publication, all reports, proxy
      statements, and financial statements that Borrower sends or makes available
      to
      its stockholders, and, not later than five (5) days after actual filing or
      the
      date such filing was first due, all registration statements and reports that
      Borrower files or is required to file with the Securities and Exchange
      Commission, or any other governmental or regulatory authority.

     

    (d) Other
      Information.
      Such
      other statements, lists of property and accounts, budgets, forecasts, reports,
      information regarding equity financings that are consummated after the Closing
      Date, or other information as Lender may from time to time reasonably
      request.

     

    5.3 Existence.
      Maintain and preserve Borrower's existence, present form of business, and all
      rights and privileges necessary or desirable in the normal course of its
      business; and keep all Borrower's property in good working order and condition,
      ordinary wear and tear excepted.

     

    5.4 Insurance.
      Obtain
      and keep in force insurance in such amounts and types as is usual in the type
      of
      business conducted by Borrower, with insurance carriers having a policyholder
      rating of not less than “A” and financial category rating of Class VII in
“Best's Insurance Guide,” unless otherwise approved by Lender. Such insurance
      policies must be in form and substance satisfactory to Lender, and shall list
      Lender as an additional insured or loss payee, as applicable, on endorsement(s)
      in form reasonably acceptable to Lender. Borrower shall furnish to Lender such
      endorsements, and upon Lender's request, copies of any or all such
      policies.

     

    
      
         

      

      
        7

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    5.5 Accounting
      Records.
      Maintain
      adequate books, accounts and records, and prepare all financial statements
      in
      accordance with GAAP, and in compliance with the regulations of any governmental
      or regulatory authority having jurisdiction over Borrower or Borrower's
      business; and upon reasonable prior notice, permit employees or agents of Lender
      , at Borrower's expense, to inspect Borrower's properties, and to examine,
      and
      make copies and memoranda of Borrower's books, accounts and records which
      support quarterly financial statements

     

    5.6 Compliance
      With Laws.
      Comply
      with all laws (including Environmental Laws), rules, regulations applicable
      to,
      and all orders and directives of any governmental or regulatory authority having
      jurisdiction over, Borrower or Borrower's business, and with all material
      agreements to which Borrower is a party, except where the failure to so comply
      would not have a Material Adverse Effect.

     

    5.7 Taxes
      and Other Liabilities.
      Pay all
      Borrower's Indebtedness when due; pay all taxes and other governmental or
      regulatory assessments before delinquency or before any penalty attaches
      thereto, except as may be contested in good faith by the appropriate procedures
      and for which Borrower shall maintain appropriate reserves; and timely file
      all
      required tax returns.

     

    5.8 Special
      Collateral Covenants. 

     

    (a) Maintenance
      of Collateral; Inspection.
      Do all
      things reasonably necessary to maintain, preserve, protect and keep all
      Collateral in good working order and salable condition, ordinary wear and tear
      excepted, deal with the Collateral in all ways as are considered good practice
      by owners of like property, and use the Collateral lawfully and, to the extent
      applicable, only as permitted by Borrower's insurance policies. Maintain, or
      cause to be maintained, complete and accurate Records relating to the
      Collateral. Upon reasonable prior notice at reasonable times during normal
      business hours, Borrower hereby authorizes Lender's officers, employees,
      representatives and agents to inspect the Collateral and to discuss the
      Collateral and the Records relating thereto with Borrower's officers, and,
      in
      the case of any Right to Payment, with any Person which is or may be obligated
      thereon.

     

    (b) Documents
      of Title.
      Not sign
      or authorize the signing of any financing statement or other document naming
      Borrower as debtor or obligor, or acquiesce or cooperate in the issuance of
      any
      bill of lading, warehouse receipt or other document or instrument of title
      with
      respect to any Collateral, except those negotiated to Lender, or those naming
      Lender as secured party, or if solely to create, perfect or maintain a Permitted
      Lien.

     

    (c) Change
      in Location or Name.
      Without
      at least 30 days' prior written notice to Lender: (a) not relocate any
      Collateral or Records, its chief executive office, or establish a place of
      business at a location other than as specified in the Supplement; and (b) not
      change its name, mailing address, location of Collateral, jurisdiction of
      incorporation or its legal structure.

     

    
      
         

      

      
        8

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    (d) Agreement
      With Real Property Owner/Landlord.
      Obtain
      and maintain such acknowledgments, consents, waivers and agreements from the
      owner, lienholder, mortgagee and landlord with respect to any real property
      on
      which Equipment is located as Lender may require, all in form and substance
      reasonably satisfactory to Lender.

     

    (e) Certain
      Agreements on Rights to Payment.
      Other
      than in the ordinary course of business, not make any material discount, credit,
      rebate or other reduction in the original amount owing on a Right to Payment
      or
      accept in satisfaction of a Right to Payment less than the original amount
      thereof.

     

    
      
        ARTICLE 6
          NEGATIVE
          COVENANTS

      

    

     

    During
      the term of this Agreement and until the performance of all Obligations,
      Borrower will not:

     

    6.1 Indebtedness.
      Be
      indebted for borrowed money, the deferred purchase price of property, or leases
      which would be capitalized in accordance with GAAP; or become liable as a
      surety, guarantor, accommodation party or otherwise for or upon the obligation
      of any other Person, except:

     

    (a) Indebtedness
      incurred for the acquisition of machinery, equipment, goods, supplies or
      inventory on normal trade credit; 

     

    (b) Indebtedness
      incurred pursuant to one or more transactions permitted under Section
      6.4;

     

    (c) Indebtedness
      of Borrower under this Agreement; 

     

    (d) Subordinated
      Debt; and

     

    (e) Any
      Indebtedness approved by Lender prior to the Closing Date as shown on
Schedule 6.1
      hereto.

     

    6.2 Liens.
      Create,
      incur, assume or permit to exist any Lien, or grant any other Person a negative
      pledge, on any of Borrower's property, except Permitted Liens. Borrower and
      Lender agree that this covenant is not intended to constitute a lien, deed
      of
      trust, equitable mortgage, or security interest of any kind on any of Borrower's
      real property, and this Agreement shall not be recorded or recordable.
      Notwithstanding the foregoing, however, violation of this covenant by Borrower
      shall constitute an Event of Default.

     

    6.3 Dividends.
      Pay any
      dividends or purchase, redeem or otherwise acquire or make any other
      distribution with respect to any of Borrower's capital stock, except
      (a) dividends or other distributions solely of capital stock of Borrower,
      and (b) so long as no Event of Default has occurred and is continuing,
      repurchases of stock from employees upon termination of employment under reverse
      vesting or similar repurchase plans not to exceed $100,000 in any calendar
      year.

     

    
      
         

      

      
        9

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    6.4 Changes/Mergers.
      Liquidate or dissolve; or enter into any consolidation, merger or other
      combination in which the stockholders of the Borrower immediately prior to
      the
      first such transaction own less than 50% of the voting stock of the Borrower
      immediately after giving effect to such transaction or related series of such
      transactions, except that Borrower may consolidate or merge so long as: (A)
      the
      entity that results from such merger or consolidation (the “Surviving
      Entity”)
      shall
      have executed and delivered to Lender an agreement in form and substance
      reasonably satisfactory to Lender, containing an assumption by the Surviving
      Entity of the due and punctual payment and performance of all Obligations and
      performance and observance of each covenant and condition of Borrower in the
      Loan Documents; (B) all such obligations of the Surviving Entity to Lender
      shall
      be guaranteed by any entity that directly or indirectly owns or controls more
      than 50% of the voting stock of the Surviving Entity; (C) immediately after
      giving effect to such merger or consolidation, no Event of Default or, event
      which with the lapse of time or giving of notice or both, would result in an
      Event of Default shall have occurred and be continuing; and (D) the credit
      risk
      to Lender, in its sole discretion, of the Surviving Entity shall not be
      increased. In determining whether the proposed merger or consolidation would
      result in an increased credit risk, Lender may consider, among other things,
      changes in Borrower’s management team, employee base, access to equity markets,
      venture capital support, financial position and/or disposition of intellectual
      property rights which may reasonably be anticipated as a result of the
      transaction.

     

    6.5 Sales
      of Assets.
      Sell,
      transfer, lease, license or otherwise dispose of (a “Transfer”)
      any of
      Borrower’s assets except (i) licenses of Intellectual Property in the ordinary
      course of business consistent with industry practice, provided that such
      licenses of Intellectual Property neither result in a legal transfer of title
      of
      the licensed Intellectual Property nor have the same effect as a sale of such
      Intellectual Property; (ii) Transfers of worn-out, obsolete or surplus property
      (each as determined by the Borrower in its reasonable judgment); (iii) Transfers
      of Inventory in the ordinary course of business; (iv) Transfers constituting
      Permitted Liens; and (v) Transfers permitted in Section 6.6
      hereunder.

     

    6.6 Loans/Investments.
      Make or
      suffer to exist any loans, guaranties, advances, or investments,
      except:

     

    (a) Accounts
      receivable in the ordinary course of Borrower's business;

     

    (b) Investments
      in domestic certificates of deposit issued by, and other domestic investments
      with, financial institutions organized under the laws of the United States
      or a
      state thereof, having at least One Hundred Million Dollars ($100,000,000) in
      capital and a rating of at least “investment grade” or “A” by Moody's or any
      successor rating agency;

     

    (c) Investments
      in marketable obligations of the United States of America and in open market
      commercial paper given the highest credit rating by a national credit agency
      and
      maturing not more than one year from the creation thereof; 

     

    (d) Temporary
      advances to cover incidental expenses to be incurred in the ordinary course
      of
      business; 

     

    
      
         

      

      
        10

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    (e) Investments
      in joint ventures, strategic alliances, licensing and similar arrangements
      customary in Borrower’s industry and which do not require Borrower to assume or
      otherwise become liable for the obligations of any third party not directly
      related to or arising out of such arrangement or, without the prior written
      consent of Lender, require Borrower to transfer ownership of non-cash assets
      to
      such joint venture or other entity; and,

     

    (f) Investments
      in wholly-owned subsidiaries of the Borrower.

     

    6.7 Transactions
      With Related Persons.
      Directly or indirectly enter into any transaction with or for the benefit of
      a
      Related Person on terms more favorable to the Related Person than would have
      been obtainable in an “arms' length” dealing.

     

    6.8 Other
      Business.
      Engage
      in any material line of business other than the research
      and development and commercialization of Wireless Millimeter Wave Communications
      Systems, broadly defined (the "Business")

     

    6.9 Financing
      Statements and Other Actions.
      Fail to
      execute and deliver to Lender all financing statements, notices and other
      documents from time to time reasonably requested by Lender to maintain a first
      perfected security interest in the Collateral in favor of Lender; perform such
      other acts, and execute and deliver to Lender such additional conveyances,
      assignments, agreements and instruments, as Lender may at any time request
      in
      connection with the administration and enforcement of this Agreement or Lender's
      rights, powers and remedies hereunder.

     

    6.10 Compliance.
      Become
      an
“investment company” or controlled by an “investment company,” within the
      meaning of the Investment Company Act of 1940, or become principally engaged
      in,
      or undertake as one of its important activities, the business of extending
      credit for the purpose of purchasing or carrying margin stock, or use the
      proceeds of any Loan for such purpose. Fail to meet the minimum funding
      requirements of ERISA, permit a Reportable Event or Prohibited Transaction,
      as
      defined in ERISA, to occur, fail to comply with the Federal Fair Labor Standards
      Act or violate any law or regulation, which violation could have a Material
      Adverse Effect or a material adverse effect on the Collateral or the priority
      of
      Lender’s Lien on the Collateral, or permit any of its subsidiaries to do any of
      the foregoing. 

     

    6.11 Other
      Deposit and Securities Accounts. Maintain
      any deposit accounts or accounts holding securities owned by Borrower except
      (i)
      Deposit Accounts and investment/securities accounts as set forth on
      Schedule 6.11 and (ii) other Deposit Accounts and securities/investment
      accounts, in each case, with respect to which Borrower and Lender shall have
      taken such action as Lender reasonably deems necessary to obtain a perfected
      first security interest therein.

     

    6.12 Prepayment
      of Indebtedness.
      Prepay,
      redeem or otherwise satisfy in any manner prior to the scheduled repayment
      thereof any Indebtedness (other than the Loan), unless in the ordinary course
      of
      Borrower's business.

     

    
      
         

      

      
        11

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    
      
        ARTICLE 7
          EVENTS
          OF
          DEFAULT

      

    

     

    7.1 Events
      of Default; Acceleration.
      The
      occurrence of any of the following (each, an “Event
      of Default”)
      shall,
      at the option of Lender (1) make all sums of Basic Interest and principal and
      any Obligations and other amounts owing under any Loan Documents immediately
      due
      and payable without notice of default, presentment or demand for payment,
      protest or notice of nonpayment or dishonor or any other notices or demands,
      and
      (2) give Lender the right to exercise any other right or remedy provided by
      contract or applicable law:

     

    (a) Borrower
      shall fail to pay any principal, interest or other payment under this Agreement
      or any Note, or fail to pay any fees or other charges when due under any Loan
      Document, and such failure continues for fifteen (15) Business Days or more
      after the same first becomes due; or an Event of Default as defined in any
      other
      Loan Document shall have occurred.

     

    (b) Any
      representation or warranty made, or financial statement, certificate or other
      document provided, by Borrower under any Loan Document shall prove to have
      been
      false or misleading in any material respect when made or deemed made
      herein.

     

    (c) Borrower
      shall fail to pay its debts generally as they become due or shall commence
      any
      Insolvency Proceeding with respect to itself; an involuntary Insolvency
      Proceeding shall be filed against Borrower, or a custodian, receiver, trustee,
      assignee for the benefit of creditors, or other similar official, shall be
      appointed to take possession, custody or control of the properties of Borrower,
      and such involuntary Insolvency Proceeding, petition or appointment is
      acquiesced to by Borrower or is not dismissed within forty five (45) days;
      or
      the dissolution or termination of the business of Borrower; or Borrower shall
      take any corporate action for the purpose of effecting, approving, or consenting
      to any of the foregoing.

     

    (d) Borrower
      shall be in default beyond any applicable period of grace or cure under any
      other agreement involving the borrowing of money, the purchase of property,
      the
      advance of credit or any other monetary liability of any kind to Lender or
      to
      any Person which results in the acceleration of payment of such obligation
      in an
      amount in excess of $50,000.

     

    (e) Any
      governmental or regulatory authority shall take any judicial or administrative
      action, or any defined benefit pension plan maintained by Borrower shall have
      any unfunded liabilities, any of which, in the reasonable judgment of Lender,
      might have a Material Adverse Effect.

     

    (f) Any
      sale,
      transfer or other disposition of all or a substantial or material part of the
      assets of Borrower, including without limitation to any trust or similar entity,
      shall occur.

     

    (g) Any
      judgment(s) singly or in the aggregate in excess of $50,000 shall be entered
      against Borrower which remain unsatisfied, unvacated or unstayed pending appeal
      for twenty (20) or more days after entry thereof.

     

    
      
         

      

      
        12

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    (h) Any
      Person
      or two or more Persons (other
      than any “Excluded Person” as defined below)
      acting
      in concert shall have acquired (in a single transaction or series of related
      transactions) beneficial ownership (within the meaning of Rule 13d-3
      of the
      Securities and Exchange Commission) of outstanding
      shares of voting stock of Borrower representing fifty
      percent
      (50%)
      or
      more of the voting
      power of all
      shares
      of
      Borrower’s voting
      stock that are outstanding immediately after such acquisition. As used in this
      paragraph, “Excluded
      Person”
means:
      (i) any Person who is a stockholder of Borrower as of the Closing Date; (ii)
      a
      venture capital firm or similar investment fund or institution; or (iii) an
      affiliate of any Person described in clause (i) or (ii).

     

    (i) Borrower
      shall fail to perform or observe any covenant contained in Article 6 of this
      Agreement. 

     

    (j) Borrower
      shall fail to perform or observe any covenant contained in Article 5 or
      elsewhere in this Agreement or any other Loan Document (other than a covenant
      which is dealt with specifically elsewhere in this Article 7) and, if capable
      of
      being cured, the breach of such covenant is not cured within 30 days after
      the
      sooner to occur of Borrower's receipt of notice of such breach from Lender
      or
      the date on which such breach first becomes known to any officer of Borrower;
      provided,
      however
      that if
      such breach is not capable of being cured within such 30-day period and Borrower
      timely notifies Lender of such fact and Borrower diligently pursues such cure,
      then the cure period shall be extended to the date requested in Borrower's
      notice but in no event more than 90 days from the initial breach; provided,
      further,
      that
      such additional 60-day opportunity to cure shall not apply in the case of any
      failure to perform or observe any covenant which has been the subject of a
      prior
      failure within the preceding 180 days or which is a willful and knowing breach
      by Borrower.

     

    7.2 Remedies
      Upon Default.
      Upon the
      occurrence and during the continuance of an Event of Default, Lender shall
      be
      entitled to, at its option, exercise any or all of the rights and remedies
      available to a secured party under the UCC or any other applicable law, and
      exercise any or all of its rights and remedies provided for in this Agreement
      and in any other Loan Document. The obligations of Borrower under this Agreement
      shall continue to be effective or be reinstated, as the case may be, if at
      any
      time any payment of any Obligations is rescinded or must otherwise be returned
      by Lender upon, on account of, or in connection with, the insolvency, bankruptcy
      or reorganization of Borrower or otherwise, all as though such payment had
      not
      been made.

     

    7.3 Sale
      of Collateral.
      Upon the
      occurrence and during the continuance of an Event of Default, Lender may sell
      all or any part of the Collateral, at public or private sales, to itself, a
      wholesaler, retailer or investor, for cash, upon credit or for future delivery,
      and at such price or prices as may be commercially reasonable. To the extent
      permitted by law, Borrower hereby specifically waives all rights of redemption
      and any rights of stay or appraisal which it has or may have under any
      applicable law in effect from time to time. Any such public or private sales
      shall be held at such times and at such place(s) as Lender may determine. In
      case of the sale of all or any part of the Collateral on credit or for future
      delivery, the Collateral so sold may be retained by Lender until the selling
      price is paid by the purchaser, but Lender shall not incur any liability in
      case
      of the failure of such purchaser to pay for the Collateral and, in case of
      any
      such failure, such Collateral may be resold. Lender may, instead of exercising
      its power of sale, proceed to enforce its security interest in the Collateral
      by
      seeking a judgment or decree of a court of competent jurisdiction.

     

    
      
         

      

      
        13

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    7.4 Borrower's
      Obligations Upon Default.
      Upon the
      request of Lender after the occurrence and during the continuance of an Event
      of
      Default, Borrower will:

     

    (a) Assemble
      and make available to Lender the Collateral at such place(s) as Lender shall
      reasonably designate, segregating all Collateral so that each item is capable
      of
      identification; and

     

    (b) Subject
      to the rights of any lessor, permit Lender, by Lender's officers, employees,
      agents and representatives, to enter any premises where any Collateral is
      located, to take possession of the Collateral, to complete the processing,
      manufacture or repair of any Collateral, and to remove the Collateral, or to
      conduct any public or private sale of the Collateral, all without any liability
      of Lender for rent or other compensation for the use of Borrower's
      premises.

     

    
      
        ARTICLE 8
          SPECIAL
          COLLATERAL PROVISIONS

      

    

     

    8.1 Compromise
      and Collection.
      Borrower
      and Lender recognize that setoffs, counterclaims, defenses and other claims
      may
      be asserted by obligors with respect to certain of the Rights to Payment; that
      certain of the Rights to Payment may be or become uncollectible in whole or
      in
      part; and that the expense and probability of success of litigating a disputed
      Right to Payment may exceed the amount that reasonably may be expected to be
      recovered with respect to such Right to Payment. Borrower hereby authorizes
      Lender, after and during the continuance of an Event of Default, to compromise
      with the obligor, accept in full payment of any Right to Payment such amount
      as
      Lender shall negotiate with the obligor, or abandon any Right to Payment. Any
      such action by Lender shall be considered commercially reasonable so long as
      Lender acts in good faith based on information known to it at the time it takes
      any such action.

     

    8.2 Performance
      of Borrower's Obligations.
      Without
      having any obligation to do so, upon reasonable prior notice to Borrower, Lender
      may perform or pay any obligation which Borrower has agreed to perform or pay
      under this Agreement, including, without limitation, the payment or discharge
      of
      taxes or Liens levied or placed on or threatened against the Collateral. In
      so
      performing or paying, Lender shall determine the action to be taken and the
      amount necessary to discharge such obligations. Borrower shall reimburse Lender
      on demand for any amounts paid by Lender pursuant to this Section, which amounts
      shall constitute Obligations secured by the Collateral and shall bear interest
      from the date of demand at the Default Rate.

     

    8.3 Power
      of Attorney.
      For the
      purpose of protecting and preserving the Collateral and Lender's rights under
      this Agreement, Borrower hereby irrevocably appoints Lender, with full power
      of
      substitution, as its attorney-in-fact with full power and authority, after
      the
      occurrence and during the continuance of an Event of Default, to do any act
      which Borrower is obligated to do hereunder; to exercise such rights with
      respect to the Collateral as Borrower might exercise; to use such Inventory,
      Equipment, Fixtures or other property as Borrower might use; to enter Borrower's
      premises; to give notice of Lender's security interest in, and to collect the
      Collateral; and before or after Default, to execute and file in Borrower's
      name
      any financing statements, amendments and continuation statements, account
      control agreements or other Security Documents necessary or desirable to create,
      maintain, perfect or continue the perfection of Lender's security interests
      in
      the Collateral. Borrower hereby ratifies all that Lender shall lawfully do
      or
      cause to be done by virtue of this appointment.

     

    
      
         

      

      
        14

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    8.4 Authorization
      for Lender to Take Certain Action.
      The
      power of attorney created in Section 8.3 is a power coupled with an interest
      and
      shall be irrevocable. The powers conferred on Lender hereunder are solely to
      protect its interests in the Collateral and shall not impose any duty upon
      Lender to exercise such powers. Lender shall be accountable only for amounts
      that it actually receives as a result of the exercise of such powers and in
      no
      event shall Lender or any of its directors, officers, employees, agents or
      representatives be responsible to Borrower for any act or failure to act, except
      for gross negligence or willful misconduct. Only after the occurrence and during
      the continuance of an Event of Default, may Lender exercise this power of
      attorney. Such exercise may be without prior notice to or assent of Borrower,
      in
      the name of Borrower, or in Lender's own name, from time to time in Lender's
      sole discretion and at Borrower's expense. To further carry out the terms of
      this Agreement, after the occurrence and during the continuance of an Event
      of
      Default, Lender may:

     

    (a) Execute
      any statements or documents or take possession of, and endorse and collect
      and
      receive delivery or payment of, any checks, drafts, notes, acceptances or other
      instruments and documents constituting Collateral, or constituting the payment
      of amounts due and to become due or any performance to be rendered with respect
      to the Collateral.

     

    (b) Sign
      and
      endorse any invoices, freight or express bills, bills of lading, storage or
      warehouse receipts; drafts, certificates and statements under any commercial
      or
      standby letter of credit relating to Collateral; assignments, verifications
      and
      notices in connection with Accounts; or any other documents relating to the
      Collateral, including without limitation the Records.

     

    (c) Use
      or
      operate Collateral or any other property of Borrower for the purpose of
      preserving or liquidating Collateral.

     

    (d) File
      any
      claim or take any other action or proceeding in any court of law or equity
      or as
      otherwise deemed appropriate by Lender for the purpose of collecting any and
      all
      monies due or securing any performance to be rendered with respect to the
      Collateral.

     

    (e) Commence,
      prosecute or defend any suits, actions or proceedings or as otherwise deemed
      appropriate by Lender for the purpose of protecting or collecting the
      Collateral. In furtherance of this right, upon the occurrence and during the
      continuance of an Event of Default, Lender may apply for the appointment of
      a
      receiver or similar official to operate Borrower's business.

     

    (f) Prepare,
      adjust, execute, deliver and receive payment under insurance claims, and collect
      and receive payment of and endorse any instrument in payment of loss or returned
      premiums or any other insurance refund or return, and apply such amounts at
      Lender's sole discretion, toward repayment of the Obligations or replacement
      of
      the Collateral.

     

    
      
         

      

      
        15

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    8.5 Application
      of Proceeds.
      Any
      Proceeds and other monies or property received by Lender pursuant to the terms
      of this Agreement or any Loan Document may be applied by Lender first to the
      payment of expenses of collection, including without limitation reasonable
      attorneys' fees, and then to the payment of the Obligations in such order of
      application as Lender may elect.

     

    8.6 Deficiency.
      If the
      Proceeds of any disposition of the Collateral are insufficient to cover all
      costs and expenses of such sale and the payment in full of all the Obligations,
      plus all other sums required to be expended or distributed by Lender, then
      Borrower shall be liable for any such deficiency.

     

    8.7 Lender
      Transfer.
      Upon the
      transfer of all or any part of the Obligations, Lender may transfer all or
      part
      of the Collateral and shall be fully discharged thereafter from all liability
      and responsibility with respect to such Collateral so transferred, and the
      transferee shall be vested with all the rights and powers of Lender hereunder
      with respect to such Collateral so transferred, but with respect to any
      Collateral not so transferred, Lender shall retain all rights and powers hereby
      given.

     

    8.8 Lender's
      Duties. 

     

    (a) Lender
      shall use reasonable care in the custody and preservation of any Collateral
      in
      its possession. Without limitation on other conduct which may be considered
      the
      exercise of reasonable care, Lender shall be deemed to have exercised reasonable
      care in the custody and preservation of such Collateral if such Collateral
      is
      accorded treatment substantially equal to that which Lender accords its own
      property, it being understood that Lender shall not have any responsibility
      for
      ascertaining or taking action with respect to calls, conversions, exchanges,
      maturities, declining value, tenders or other matters relative to any
      Collateral, regardless of whether Lender has or is deemed to have knowledge
      of
      such matters; or taking any necessary steps to preserve any rights against
      any
      Person with respect to any Collateral. Under no circumstances shall Lender
      be
      responsible for any injury or loss to the Collateral, or any part thereof,
      arising from any cause beyond the reasonable control of Lender.

     

    (b) Lender
      may at any time deliver the Collateral or any part thereof to Borrower and
      the
      receipt of Borrower shall be a complete and full acquittance for the Collateral
      so delivered, and Lender shall thereafter be discharged from any liability
      or
      responsibility therefor.

     

    (c) Neither
      Lender, nor any of its directors, officers, employees, agents, attorneys or
      any
      other person affiliated with or representing Lender shall be liable for any
      claims, demands, losses or damages, of any kind whatsoever, made, claimed,
      incurred or suffered by Borrower or any other party through the ordinary
      negligence of Lender, or any of its directors, officers, employees, agents,
      attorneys or any other person affiliated with or representing
      Lender.

     

    
      
         

      

      
        16

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    8.9 Termination
      of Security Interests.
      Upon the
      payment in full of the Obligations and satisfaction of all Borrower’s
      obligations under this Agreement and the other Loan Documents, and if Lender
      has
      no further obligations under its Commitment, the security interest granted
      hereby shall terminate and all rights to the Collateral shall revert to
      Borrower. Upon any such termination, the Lender shall, at Borrower's expense,
      execute and deliver to Borrower such documents as Borrower shall reasonably
      request to evidence such termination.

     

    
      
        ARTICLE 9
          GENERAL
          PROVISIONS

      

    

     

    9.1 Notices.
      Any
      notice given by any party under any Loan Document shall be in writing and
      personally delivered, sent by overnight courier, or United States mail, postage
      prepaid, or sent by facsimile, or other authenticated message, charges prepaid,
      to the other party's or parties' addresses set forth on Schedule 9.1. Each
      party may change the address or facsimile number to which notices, requests
      and
      other communications are to be sent by giving written notice of such change
      to
      each other party. Notice given by hand delivery shall be deemed received on
      the
      date delivered; if sent by overnight courier, on the next Business Day after
      delivery to the courier service; if by first class mail, on the third Business
      Day after deposit in the U.S. Mail; and if by facsimile, on the date of
      transmission.

     

    9.2 Binding
      Effect.
      The
      Loan Documents shall be binding upon and inure to the benefit of Borrower and
      Lender and their respective successors and assigns; provided, however, that
      Borrower may not assign or transfer Borrower's rights or obligations under
      any
      Loan Document. Lender reserves the right to sell, assign, transfer, negotiate
      or
      grant participations in all or any part of, or any interest in, Lender's rights
      and obligations under the Loan Documents. In connection with any of the
      foregoing, Lender may disclose all documents and information which Lender now
      or
      hereafter may have relating to the Loans, Borrower, or its
      business.

     

    9.3 No
      Waiver.
      Any
      waiver, consent or approval by Lender of any Event of Default or breach of
      any
      provision, condition, or covenant of any Loan Document must be in writing and
      shall be effective only to the extent set forth in writing. No waiver of any
      breach or default shall be deemed a waiver of any later breach or default of
      the
      same or any other provision of any Loan Document. No failure or delay on the
      part of Lender in exercising any power, right, or privilege under any Loan
      Document shall operate as a waiver thereof, and no single or partial exercise
      of
      any such power, right, or privilege shall preclude any further exercise thereof
      or the exercise of any other power, right or privilege. Lender has the right
      at
      its sole option to continue to accept interest and/or principal payments due
      under the Loan Documents after default, and such acceptance shall not constitute
      a waiver of said default or an extension of the maturity of any Loan unless
      Lender agrees otherwise in writing.

     

    9.4 Rights
      Cumulative.
      All
      rights and remedies existing under the Loan Documents are cumulative to, and
      not
      exclusive of, any other rights or remedies available under contract or
      applicable law.

     

    9.5 Unenforceable
      Provisions.
      Any
      provision of any Loan Document executed by Borrower which is prohibited or
      unenforceable in any jurisdiction, shall be so only as to such jurisdiction
      and
      only to the extent of such prohibition or unenforceability, but all the
      remaining provisions of any such Loan Document shall remain valid and
      enforceable.

     

    
      
         

      

      
        17

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    9.6 Accounting
      Terms.
      Except
      as otherwise provided in this Agreement, accounting terms and financial
      covenants and information shall be determined and prepared in accordance with
      GAAP.

     

    9.7 Indemnification;
      Exculpation.
      Borrower shall pay and protect, defend and indemnify Lender and Lender's
      employees, officers, directors, shareholders, affiliates, correspondents, agents
      and representatives (other than Lender, collectively “Agents”)
      against, and hold Lender and each such Agent harmless from, all claims, actions,
      proceedings, liabilities, damages, losses, expenses (including, without
      limitation, attorneys' fees and costs) and other amounts incurred by Lender
      and
      each such Agent, arising from (i) the matters contemplated by this Agreement
      or
      any other Loan Documents, (ii) any dispute between Borrower and a third party,
      or (iii) any contention that Borrower has failed to comply with any law, rule,
      regulation, order or directive applicable to Borrower's business; provided,
      however,
      that
      this indemnification shall not apply to any of the foregoing incurred solely
      as
      the result of Lender's or any Agent's gross negligence or willful misconduct.
      This indemnification shall survive the payment and satisfaction of all of
      Borrower's Obligations to Lender.

     

    9.8 Reimbursement.
      Borrower shall reimburse Lender for all costs and expenses, including without
      limitation reasonable attorneys' fees and disbursements expended or incurred
      by
      Lender in any arbitration, mediation, judicial reference, legal action or
      otherwise in connection with (a) the preparation and negotiation of the
      Loan Documents, (b) the amendment and enforcement of the Loan Documents,
      including without limitation during any workout, attempted workout, and/or
      in
      connection with the rendering of legal advice as to Lender's rights, remedies
      and obligations under the Loan Documents, (c) collecting any sum which
      becomes due Lender under any Loan Document, (d) any proceeding for
      declaratory relief, any counterclaim to any proceeding, or any appeal, or
      (e) the protection, preservation or enforcement of any rights of Lender.
      For the purposes of this section, attorneys' fees shall include, without
      limitation, fees incurred in connection with the following: (1) contempt
      proceedings; (2) discovery; (3) any motion, proceeding or other
      activity of any kind in connection with an Insolvency Proceeding;
      (4) garnishment, levy, and debtor and third party examinations; and
      (5) post-judgment motions and proceedings of any kind, including without
      limitation any activity taken to collect or enforce any judgment. All of the
      foregoing costs and expenses shall be payable upon demand by Lender, and if
      not
      paid within forty-five (45) days of presentation of invoices shall bear
      interest at the highest applicable Default Rate.

     

    9.9 Execution
      in Counterparts.
      This
      Agreement may be executed in any number of counterparts which, when taken
      together, shall constitute but one agreement.

     

    9.10 Entire
      Agreement.
      The
      Loan Documents are intended by the parties as the final expression of their
      agreement and therefore contain the entire agreement between the parties and
      supersede all prior understandings or agreements concerning the subject matter
      hereof. This Agreement may be amended only in a writing signed by Borrower
      and
      Lender.

     

    
      
         

      

      
        18

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    9.11 Governing
      Law and Jurisdiction. 

     

    (a) THIS
      AGREEMENT AND THE LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN
      ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF DELAWARE.

     

    (b) ANY
      LEGAL
      ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
      MAY BE BROUGHT IN THE COURTS OF THE STATE OF DELAWARE OR OF THE UNITED STATES
      FOR THE DISTRICT OF DELAWARE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
      EACH OF BORROWER AND LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
      TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF BORROWER AND LENDER
      IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
      VENUE
      OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
      HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
      OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. BORROWER AND LENDER EACH
      WAIVE
      PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
      BY ANY OTHER MEANS PERMITTED BY MASSACHUSETTS LAW.

     

    9.12 Waiver
      of Jury Trial.
      TO THE
      EXTENT NOT PROHIBITED BY APPLICABLE LAW, BORROWER AND LENDER EACH WAIVES ITS
      RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED
      UPON
      OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR
      THE
      TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
      LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY
      OR
      ANY PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
      CLAIMS, OR OTHERWISE. BORROWER AND LENDER EACH AGREES THAT ANY SUCH CLAIM OR
      CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING
      THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL
      BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM
      OR
      OTHER PROCEEDING WHICH SEEMS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY
      OR
      ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION
      HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
      RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN
      DOCUMENTS.

     

    
      
        ARTICLE 10
          DEFINITIONS

      

    

     

    The
      definitions appearing in this Agreement or any Supplement shall be applicable
      to
      both the singular and plural forms of the defined terms:

     

    
      
         

      

      
        19

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Account” means
      any
“account,” as such term is defined in the UCC, now owned or hereafter acquired
      by Borrower or in which Borrower now holds or hereafter acquires any interest
      and, in any event, shall include, without limitation, all accounts receivable,
      book debts and other forms of obligations (other than forms of obligations
      evidenced by Chattel Paper, Documents or Instruments) now owned or hereafter
      received or acquired by or belonging or owing to Borrower (including, without
      limitation, under any trade name, style or division thereof) whether arising
      out
      of goods sold or services rendered by Borrower or from any other transaction,
      whether or not the same involves the sale of goods or services by Borrower
      (including, without limitation, any such obligation that may be characterized
      as
      an account or contract right under the UCC) and all of Borrower's rights in,
      to
      and under all purchase orders or receipts now owned or hereafter acquired by
      it
      for goods or services, and all of Borrower's rights to any goods represented
      by
      any of the foregoing (including, without limitation, unpaid seller's rights
      of
      rescission, replevin, reclamation and stoppage in transit and rights to
      returned, reclaimed or repossessed goods), and all monies due or to become
      due
      to Borrower under all purchase orders and contracts for the sale of goods or
      the
      performance of services or both by Borrower or in connection with any other
      transaction (whether or not yet earned by performance on the part of Borrower),
      now in existence or hereafter occurring, including, without limitation, the
      right to receive the proceeds of said purchase orders and contracts, and all
      collateral security and guarantees of any kind given by any Person with respect
      to any of the foregoing.

    

    “Affiliate”
      means
      any Person which directly or indirectly controls, is controlled by, or is under
      common control with Borrower. “Control,” “controlled by” and “under common
      control with” mean direct or indirect possession of the power to direct or cause
      the direction of management or policies (whether through ownership of voting
      securities, by contract or otherwise); provided, that control shall be
      conclusively presumed when any Person or affiliated group directly or indirectly
      owns five percent (5%) or more of the securities having ordinary voting power
      for the election of directors of a corporation.

    

    “Agreement”
      means
      this Loan and Security Agreement, as may be amended or supplemented from time
      to
      time.

    

    “Bankruptcy
      Code”
      means
      the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101, et seq.),
      as
      amended.

    

    “Basic
      Interest”
      means 7%
      interest compounded daily.

    

    “Business
      Day”
      means
      any day other than a Saturday, Sunday or other day on which commercial banks
      in
      New York City are authorized or required by law to close.

    

    “Chattel
      Paper”
      means
      any “chattel paper,” as such term is defined in the UCC, now owned or hereafter
      acquired by Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “Closing
      Date”
      means
      the date of this Agreement.

     

    
      
         

      

      
        20

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Collateral” means
      all
      of Borrower’s right, title and interest in and to the following property,
      whether now owned or hereafter acquired and wherever located: (a) all
      Receivables; (b) all Equipment; (c) all Fixtures; (d) all General Intangibles
      and Rights to Payment; (e) all Inventory; (f) all Investment Property; (g)
      all
      Deposit Accounts; (h) all other Goods and personal property of Borrower,
      whether tangible or intangible and whether now or hereafter owned or existing,
      leased, consigned by or to, or acquired by, Borrower and wherever located;
      (i)
      all Records; and (j) all Proceeds of each of the foregoing and all accessions
      to, substitutions and replacements for, and rents, profits and products of
      each
      of the foregoing.

    

    “Copyright
      License”
      means
      any
      written agreement granting any right to use any Copyright or Copyright
      registration now owned or hereafter acquired by Borrower or in which Borrower
      now holds or hereafter acquires any interest.

    

    “Copyrights”
      means
      all of the following now owned or hereafter acquired by Borrower or in which
      Borrower now holds or hereafter acquires any interest: (i) all copyrights,
      whether registered or unregistered, held pursuant to the laws of the United
      States, any State thereof or of any other country; (ii) all registrations,
      applications and recordings in the United States Copyright Office or in any
      similar office or agency of the United States, any State thereof or any other
      country; (iii) all continuations, renewals or extensions thereof; and (iv)
      any
      registrations to be issued under any pending applications.

    

    “Default”
      means an
      event which with the giving of notice, passage of time, or both would constitute
      an Event of Default.

    

    “Default
      Rate”
      is
      defined in Section 2.5.

    

    “Deposit
      Accounts” means
      any
“deposit accounts,” as such term is defined in the UCC, now owned or hereafter
      acquired by Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “Documents”
      means
      any “documents,” as such term is defined in the UCC, now owned or hereafter
      acquired by Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “Environmental
      Laws”
      means
      all federal, state or local laws, statutes, common law duties, rules,
      regulations, ordinances and codes, together with all administrative orders,
      directed duties, requests, licenses, authorizations and permits of, and
      agreements with, any governmental authorities, in each case relating to
      environmental, health, or safety matters.

    

    “Equipment” means
      any
“equipment,” as such term is defined in the UCC, now owned or hereafter acquired
      by Borrower or in which Borrower now holds or hereafter acquires any interest
      and any and all additions, substitutions and replacements of any of the
      foregoing, wherever located, together with all attachments, components, parts,
      equipment and accessories installed thereon or affixed thereto.

     

    
      
         

      

      
        21

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Event
      of Default”
      means
      any event described in Section 7.1.

    

    “Fixtures” means
      any
“fixtures,” as such term is defined in the UCC, now owned or hereafter acquired
      by Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “GAAP”
      means
      generally accepted accounting principles and practices consistent with those
      principles and practices promulgated or adopted by the Financial Accounting
      Standards Board and the Board of the American Institute of Certified Public
      Accountants, their respective predecessors and successors. Each accounting
      term
      used but not otherwise expressly defined herein shall have the meaning given
      it
      by GAAP.

    

    “General
      Intangibles” means
      any
“general intangibles,” as such term is defined in the UCC, now owned or
      hereafter acquired by Borrower or in which Borrower now holds or hereafter
      acquires any interest and, in any event, shall include, without limitation,
      all
      right, title and interest that Borrower may now or hereafter have in or under
      any contract, all customer lists, Copyrights, Trademarks, Patents, websites,
      domain names, and all applications therefor and reissues, extensions, or
      renewals thereof, other rights to Intellectual Property, interests in
      partnerships, joint ventures and other business associations, Licenses, permits,
      trade secrets, proprietary or confidential information, inventions (whether
      or
      not patented or patentable), technical information, procedures, designs,
      knowledge, know-how, software, data bases, data, skill, expertise, recipes,
      experience, processes, models, drawings, materials and records, goodwill
      (including, without limitation, the goodwill associated with any Trademark,
      Trademark registration or Trademark licensed under any Trademark License),
      claims in or under insurance policies, including unearned premiums,
      uncertificated securities, money, cash or cash equivalents, deposit, checking
      and other bank accounts, rights to sue for past, present and future infringement
      of Copyrights, Trademarks and Patents, rights to receive tax refunds and other
      payments and rights of indemnification.

    

    “Goods” means
      any
“goods,” as such term is defined in the UCC, now owned or hereafter acquired by
      Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “Indebtedness”
      of any
      Person means at any date, without duplication and without regard to whether
      matured or unmatured, absolute or contingent: (i) all obligations of such
      Person for borrowed money; (ii) all obligations of such Person evidenced by
      bonds, debentures, notes, or other similar instruments; (iii) all
      obligations of such Person to pay the deferred purchase price of property or
      services, except trade accounts payable arising in the ordinary course of
      business; (iv) all obligations of such Person as lessee under capital
      leases; (v) all obligations of such Person to reimburse or prepay any bank
      or other Person in respect of amounts paid under a letter of credit, banker's
      acceptance, or similar instrument, whether drawn or undrawn; (vi) all
      obligations of such Person to purchase securities which arise out of or in
      connection with the sale of the same or substantially similar securities;
      (vii) all obligations of such Person to purchase, redeem, exchange, convert
      or otherwise acquire for value any capital stock of such Person or any warrants,
      rights or options to acquire such capital stock, now or hereafter outstanding,
      except to the extent that such obligations remain performable solely at the
      option of such Person; (viii) all obligations to repurchase assets
      previously sold (including any obligation to repurchase any accounts or chattel
      paper under any factoring, receivables purchase, or similar arrangement);
      (ix) obligations of such Person under interest rate swap, cap, collar or
      similar hedging arrangements; and (x) all obligations of others of any type
      described in clause (i) through clause (ix) above guaranteed by such
      Person.

     

    
      
         

      

      
        22

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Insolvency
      Proceeding”
      means
      with respect to a Person (a) any case, action or proceeding before any court
      or
      other governmental authority relating to bankruptcy, reorganization, insolvency,
      liquidation, receivership, dissolution, winding-up or relief of debtors with
      respect to such Person, or (b) any general assignment for the benefit of
      creditors, composition, marshalling of assets for creditors, or other, similar
      arrangement in respect of such Person’s creditors generally or any substantial
      portion of its creditors, undertaken under U.S. Federal, state or foreign law,
      including the Bankruptcy Code, but in each case, excluding any avoidance or
      similar action against such Person commenced by an assignee for the benefit
      of
      creditors, bankruptcy trustee, debtor in possession, or other representative
      of
      another Person or such other Person’s estate.

    

    “Instruments”
      means
      any “instrument,” as such term is defined in the UCC, now owned or hereafter
      acquired by Borrower or in which Borrower now holds or hereafter acquires any
      interest.

    

    “Intellectual
      Property”
      means
      all
      Copyrights, Trademarks, Patents, Licenses, trade secrets, source codes, customer
      lists, proprietary or confidential information, inventions (whether or not
      patented or patentable), technical information, procedures, designs, knowledge,
      know-how, software, data bases, skill, expertise, experience, processes, models,
      drawings, materials, records and goodwill associated with the
      foregoing.

    

    “Inventory”
      means
      any
“inventory,” as such term is defined in the UCC, wherever located, now owned or
      hereafter acquired by Borrower or in which Borrower now holds or hereafter
      acquires any interest, and, in any event, shall include, without limitation,
      all
      inventory, goods and other personal property that are held by or on behalf
      of
      Borrower for sale or lease or are furnished or are to be furnished under a
      contract of service or that constitute raw materials, work in process or
      materials used or consumed or to be used or consumed in Borrower's business,
      or
      the processing, packaging, promotion, delivery or shipping of the same, and
      all
      finished goods, whether or not the same is in transit or in the constructive,
      actual or exclusive possession of Borrower or is held by others for Borrower's
      account, including, without limitation, all goods covered by purchase orders
      and
      contracts with suppliers and all goods billed and held by suppliers and all
      such
      property that may be in the possession or custody of any carriers, forwarding
      agents, truckers, warehousemen, vendors, selling agents or other
      Persons.

    

    “Investment
      Property”
      means
      any
“investment property,” as such term is defined in the UCC, now owned or
      hereafter acquired by Borrower or in which Borrower now holds or hereafter
      acquires any interest.

    

    “Letter
      of Credit Rights”
      means
      any “letter of credit rights,” as such term is defined in the UCC, now owned or
      hereafter acquired by Borrower or in which Borrower now holds or hereafter
      acquires any interest, including any right to payment under any letter of
      credit.

     

    
      
         

      

      
        23

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “License”
      means
      any Copyright License, Patent License, Trademark License or other license of
      rights or interests now held or hereafter acquired by Borrower or in which
      Borrower now holds or hereafter acquires any interest and any renewals or
      extensions thereof.

    

    “Lien”
      means
      any
      mortgage, deed of trust, pledge, hypothecation, assignment for security,
      security interest, encumbrance, levy, lien or charge of any kind, whether
      voluntarily incurred or arising by operation of law or otherwise, against any
      property, any conditional sale or other title retention agreement, any lease
      in
      the nature of a security interest, and the filing of any financing statement
      (other than a precautionary financing statement with respect to a lease that
      is
      not in the nature of a security interest) under the UCC or comparable law of
      any
      jurisdiction.

    

    “Loan”
      means an
      extension of credit by Lender under this Agreement.

    

    “Loan
      Documents”
      means,
      individually and collectively, this Loan and Security Agreement, the Note,
      and
      any security or pledge agreement(s), and all other contracts, instruments,
      addenda and documents executed in connection with this Agreement.

    

    “Material
      Adverse Effect”
      or
“Material
      Adverse Change”
means
      (a) a material adverse change in, or a material adverse effect upon, the
      operations, business, properties, or condition (financial or otherwise) of
      Borrower; (b) a material impairment of the ability of Borrower to perform under
      any Loan Document; or (c) a material adverse effect upon the legality, validity,
      binding effect or enforceability against Borrower of any Loan
      Document.

    

    “Maturity
      Date”
      means
      February __, 2010 unless the Note is converted in accordance with its
      terms.

    

    “Note”
      means a
      promissory note substantially in the form attached hereto as Exhibit “A”.

    

    “Obligations”
      means
      all debts, obligations and liabilities of Borrower to Lender currently existing
      or now or hereafter made, incurred or created under, pursuant to or in
      connection with this Agreement or any other Loan Document, whether voluntary
      or
      involuntary and however arising or evidenced, whether direct or acquired by
      Lender by assignment or succession, whether due or not due, absolute or
      contingent, liquidated or unliquidated, determined or undetermined, and whether
      Borrower may be liable individually or jointly, or whether recovery upon such
      debt may be or become barred by any statute of limitations or otherwise
      unenforceable; and all renewals, extensions and modifications thereof; and
      all
      attorneys' fees and costs incurred by Lender in connection with the collection
      and enforcement thereof as provided for in any Loan Document.

    

    “Patent
      License” means
      any
      written agreement granting any right with respect to any invention on which
      a
      Patent is in existence now owned or hereafter acquired by Borrower or in which
      Borrower now holds or hereafter acquires any interest.

    

    “Patents” means
      all
      of the following property now owned or hereafter acquired by Borrower or in
      which Borrower now holds or hereafter acquires any interest: (a) all letters
      patent of, or rights corresponding thereto in, the United States or any other
      country, all registrations and recordings thereof, and all applications for
      letters patent of, or rights corresponding thereto in, the United States or
      any
      other country, including, without limitation, registrations, recordings and
      applications in the United States Patent and Trademark Office or in any similar
      office or agency of the United States, any State thereof or any other country;
      (b) all reissues, continuations, continuations-in-part or extensions
      thereof; (c) all petty patents, divisionals, and patents of addition; and (d)
      all patents to be issued under any such applications.

     

    
      
         

      

      
        24

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Permitted
      Lien”
      means:

    

    (a) involuntary
      Liens which, in the aggregate, would not have a Material Adverse Effect and
      which in any event would not exceed, in the aggregate, the Threshold
      Amount;

    

    (b) Liens
      for
      current taxes or other governmental or regulatory assessments which are not
      delinquent, or which are contested in good faith by the appropriate procedures
      and for which appropriate reserves are maintained;

    

    (c) security
      interests on any property held or acquired by Borrower in the ordinary course
      of
      business securing Indebtedness incurred or assumed for the purpose of financing
      all or any part of the cost of acquiring such property; provided,
      that
      such Lien attaches solely to the property acquired with such Indebtedness and
      that the principal amount of such Indebtedness does not exceed one hundred
      percent (100%) of the cost of such property;

    

    (d) Liens
      in
      favor of Lender;

    

    (e) bankers'
      liens, rights of setoff and similar Liens incurred on deposits made in the
      ordinary course of business as long as an account control agreement for each
      account in which such deposits are held in a form acceptable to Lender has
      been
      executed and delivered to Lender;

    

    (f) 
      materialmen's, mechanics', repairmen's, employees' or other like Liens arising
      in the ordinary course of business and which are not delinquent for more than
      45
      days or are being contested in good faith by appropriate
      proceedings;

    

    (g) 
      any
      judgment, attachment or similar Lien, unless the judgment it secures has not
      been discharged or execution thereof effectively stayed and bonded against
      pending appeal within 30 days of the entry thereof; 

    

    (h) 
      licenses
      or sublicenses of Intellectual Property in accordance with Section 6.5;

    

    (i) Liens
      securing Subordinated Debt; and

    

    (j) Liens
      which have been approved by Lender in writing prior to the Closing Date, as
      shown on Schedule
      6.2.

    

    “Person” means
      any
      individual, sole proprietorship, partnership, joint venture, trust,
      unincorporated organization, association, corporation, limited liability
      company, institution, public benefit corporation, other entity or government
      (whether federal, state, county, city, municipal, local, foreign, or otherwise,
      including any instrumentality, division, agency, body or department
      thereof).

     

    
      
         

      

      
        25

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Proceeds”
      means
“proceeds,” as such term is defined in the UCC and, in any event, shall include,
      without limitation, (a) any and all Accounts, Chattel Paper, Instruments, cash
      or other forms of money or currency or other proceeds payable to Borrower from
      time to time in respect of the Collateral, (b) any and all proceeds of any
      insurance, indemnity, warranty or guaranty payable to Borrower from time to
      time
      with respect to any of the Collateral, (c) any and all payments (in any form
      whatsoever) made or due and payable to Borrower from time to time in connection
      with any requisition, confiscation, condemnation, seizure or forfeiture of
      all
      or any part of the Collateral by any governmental authority (or any Person
      acting under color of governmental authority), (d) any claim of Borrower against
      third parties (i) for past, present or future infringement of any
      Copyright, Patent or Patent License or (ii) for past, present or future
      infringement or dilution of any Trademark or Trademark License or for injury
      to
      the goodwill associated with any Trademark, Trademark registration or Trademark
      licensed under any Trademark License and (e) any and all other amounts from
      time
      to time paid or payable under or in connection with any of the
      Collateral.

    

    “Receivables”
      means
      all of Borrower's Accounts, Instruments, Documents, Chattel Paper, Supporting
      Obligations, and letters of credit and Letter of Credit Rights.

    

    “Records”
      means
      all Borrower's computer programs, software, hardware, source codes and data
      processing information, all written documents, books, invoices, ledger sheets,
      financial information and statements, and all other writings concerning
      Borrower's business.

    

    “Related
      Person”
      means
      any Affiliate of Borrower, or any officer, employee, director or equity security
      holder of Borrower or any Affiliate.

    

    “Rights
      to Payment”
      means
      all Borrower's accounts, instruments, contract rights, documents, chattel paper
      and all other rights to payment, including, without limitation, the Accounts,
      all negotiable certificates of deposit and all rights to payment under any
      Patent License, any Trademark License, or any commercial or standby letter
      of
      credit.

    

    “Security
      Documents”
      means
      this Loan and Security Agreement, the Supplement hereto, and any and all account
      control agreements, collateral assignments, chattel mortgages, financing
      statements, amendments to any of the foregoing and other documents from time
      to
      time executed or filed to create, perfect or maintain the perfection of Lender’s
      Liens on the Collateral.

    

    “Subordinated
      Debt”
      means
      Indebtedness (i) approved by Lender; and (ii) where the holder’s right to
      payment of such Indebtedness, the priority of any Lien securing the same, and
      the rights of the holder thereof to enforce remedies against Borrower following
      default have been made subordinate to the Liens of Lender and to the prior
      payment to Lender of the Obligations, pursuant to a written subordination
      agreement approved by Lender in its sole but reasonable discretion.

     

    
      
         

      

      
        26

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    “Subsidiary”
      means
      any
      Person a majority of the equity ownership or voting stock of which is at the
      time owned by Borrower.

    

    “Supplement”
      means
      that certain supplement to the Loan and Security Agreement, as the same may
      be
      amended or restated from time to time, and any other supplements entered into
      between Borrower and Lender, as the same may be amended or restated from time
      to
      time.

    

    “Supporting
      Obligations”
      means
      any “supporting obligations,” as such term is defined in the UCC, now owned or
      hereafter acquired by Borrower or in which Borrower now holds or hereafter
      acquires any interest.

    

    “Trademark
      License” means
      any
      written agreement granting any right to use any Trademark or Trademark
      registration now owned or hereafter acquired by Borrower or in which Borrower
      now holds or hereafter acquires any interest.

    

    “Trademarks” means
      all
      of the following property now owned or hereafter acquired by Borrower or in
      which Borrower now holds or hereafter acquires any interest: (a) all
      trademarks, tradenames, corporate names, business names, trade styles, service
      marks, logos, other source or business identifiers, prints and labels on which
      any of the foregoing have appeared or appear, designs and general intangibles
      of
      like nature, now existing or hereafter adopted or acquired, all registrations
      and recordings thereof, and any applications in connection therewith, including,
      without limitation, registrations, recordings and applications in the United
      States Patent and Trademark Office or in any similar office or agency of the
      United States, any State thereof or any other country or any political
      subdivision thereof and (b) reissues, extensions or renewals
      thereof.

    

    “UCC” means
      the
      Uniform Commercial Code as the same may, from time to time, be in effect in
      the
      State of Delaware; provided,
      that in
      the event that, by reason of mandatory provisions of law, any or all of the
      attachment, perfection or priority of, or remedies with respect to, Lender's
      Lien on any Collateral is governed by the Uniform Commercial Code as enacted
      and
      in effect in a jurisdiction other than the State of Delaware, the term “UCC”
shall mean the Uniform Commercial Code as enacted and in effect in such other
      jurisdiction solely for purposes of the provisions thereof relating to such
      attachment, perfection, priority or remedies and for purposes of definitions
      related to such provisions. Unless otherwise defined herein, terms that are
      defined in the UCC and used herein shall have the meanings given to them in
      the
      UCC.

     

    [Signature
      page follows]

    

    
      
         

      

      
        27

        
          

        

      

      
         

        Exhibit
          10.38

      

    

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

     

    
      	
              BORROWER:

            
	 	 
	
              ASYRMATOS,
                INC.

            
	 	 
	 	 
	
              By:
                

            	
              /s/
                Panos Lekkas

            
	
              Name:

            	
              Panos
                Lekkas

            
	
              Title:
                

            	
              Chief
                Executive Officer

            
	 	 
	 	 
	 	 
	
              LENDER:

            
	 	 
	
              LUMERA
                CORPORATION

            
	 	 
	 	 
	
              By:
                

            	
              /s/
                Peter J. Biere

            
	
              Name:

            	
              Peter
                J. Biere

            
	
              Title:
                

            	
              Chief
                Financial Officer

            

    

     

    
      
        
          
            Exhibit
              to Financing Statement - 1

          

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    EXHIBIT
      “A”

    

    THIS
      PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED. NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE
      144 UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
      AN
      OPINION OF COUNSEL FOR THE HOLDER SATISFACTORY TO THE COMPANY THAT SUCH
      REGISTRATION IS NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER
      FROM
      THE SECURITIES AND EXCHANGE COMMISSION.

     

    PROMISSORY
      NOTE

     

    

      
        	
                $500,000

              	
                ________,
                  2008

              
	 	
                Worcester,
                  Massachusetts

              

      

    

    

    

    For
      value
      received Asyrmatos, Inc.,
      a
      Delaware corporation (“Borrower”) promises to pay to Lumera Corporation, a
      Delaware corporation, or
      its
      assigns (the “Lender”) the principal sum of $500,000 with interest on the
      outstanding principal amount at the rate of 7.0% per annum, compounded annually
      (the “Interest Rate”). 

     

    This
      Note
      is the Note referred to in, and is entitled to all the benefits of, a Loan
      and
      Security Agreement dated as of ________ ___, 2008, between Borrower and
      Lender (the “Loan Agreement”). Each capitalized term not otherwise defined
      herein shall have the meaning set forth in the Loan Agreement. The Loan
      Agreement contains provisions for the acceleration of the maturity of this
      Note
      upon the happening of certain stated events.

     

    1. Payment.
      All
      payments of interest and principal shall be in lawful money of the United States
      of America. All payments shall be applied first to accrued interest, and
      thereafter to principal.

     

    2. Maturity.
      Unless
      this Note has been converted in accordance with the terms of Section 5 below,
      the entire outstanding principal balance and all unpaid accrued interest shall
      become fully due and payable on February _, 2010 (the “Maturity
      Date”).

     

    3. Conversion.

     

    (a) Optional
      Conversion.
      Until
      the date that is one hundred-fifty (150) days after that Borrower offers and
      issues (the "Offering"), a series of new equity securities in a Qualified
      Financing, as long as this Note remains outstanding and such date is prior
      to
      the Maturity Date, then the Lender may elect that this Note, including any
      accrued but unpaid interest thereon, convert into equity securities of the
      Borrower upon closing of such Offering at a price per share equal to the price
      per share of the equity securities sold in such Offering and subject to the
      same
      rights, preferences, privileges and obligations attached to shares of the equity
      securities issued in the Offering at the time of such conversion. For
      purposes of this Note, a “Qualified Financing” shall be either (a) a new
      investment of or a series of new investments that aggregate to at least,
      including amounts raised in previous rounds of financing (e.g. the round issuing
      Series A Preferred Stock), $3,000,000 cash by any person or entity (other than
      the members of the Company as of the date of this note)
      or (b)
      an initial public offering of securities of the Company registered under the
      Securities Act raising at least $3,000,000. Notwithstanding
      the foregoing, if the initial closing of an Qualified Financing does not occur
      on or before the Maturity Date, Lender shall have the option, in its sole
      discretion, to convert this Note into the number of fully paid and
      non-assessable shares of the Borrower’s Series A Preferred Stock at the purchase
      price paid to the Borrower at the time of the sale of the Series A Preferred
      Stock. The foregoing option may be exercised at any time within the ninety
      (90)
      days following the Maturity Date, after which this option to convert shall
      terminate.

     

    
      
        
          
            Exhibit A
              - 1

          

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    (b) Conversion
      Procedure.
      

     

    (i) Upon
      any
      conversion pursuant to Section 3(a), the Borrower shall take all measures
      necessary or appropriate to permit such conversion to occur as promptly as
      practicable and otherwise comply with all of its obligations hereunder,
      including, but not limited to, (A) calling a special meeting of the Board
      of Directors and/or stockholders of the Borrower to authorize an amendment
      to
      the Borrower’s Certificate of Incorporation authorizing the applicable class or
      series of Borrower’s capital stock issuable upon conversion of the Note and, if
      necessary, the additional capital stock issuable upon conversion of the
      aforementioned capital stock, (B) filing such amendment with the Secretary
      of State of the State of Delaware, and (C) taking any other action
      necessary or appropriate to consummate the transactions contemplated hereby
      and
      to permit the conversion to occur as promptly as practicable. If at any time
      the
      number of authorized but unissued shares of Borrower’s capital stock are
      insufficient to permit the conversions contemplated by this Section 3, the
      Borrower shall take such actions as may be necessary to increase the Borrower’s
      authorized, unreserved and unissued shares of the applicable class or series
      of
      capital stock to such number of shares as shall be sufficient for such
      conversion. Upon delivery, all shares issued pursuant to this Section 4 shall
      be
      duly and validly issued, fully paid and non-assessable.

     

    (ii) No
      fractional shares or interest of capital stock of the Borrower, or scrip
      representing fractional shares or interests, shall be issued upon conversion
      of
      the Note pursuant to this Section 3. Any principal amount and accrued but
      unpaid interest not converted into the capital stock because of the restrictions
      of the preceding sentence shall be paid by the Borrower to the Lender in
      immediately available funds on the date of the conversion. If this Note is
      converted into capital stock of the Borrower, this Note shall be treated by
      the
      Borrower as surrendered for cancellation and exchanged into such capital stock
      and this Note will be deemed, for all purposes, to be canceled on the books
      of
      the Borrower and the obligation represented by this Note so terminated. The
      Borrower shall, as soon as practicable after receipt of this Note marked
      cancelled, issue and deliver to the Lender at its designated address a
      certificate or certificates for the number of shares of capital stock to which
      the Lender shall be entitled upon such conversion (bearing such legends as
      are
      required by applicable state and Federal securities laws in the opinion of
      counsel to the Borrower), together with immediately available funds payable
      to
      the Holder for any cash amounts payable as described in this clause (ii).

     

    4. Liquidity
      Event.
      If the
      Borrower shall determine to engage in any transaction which would result in
      a
      Liquidity Event (defined below) at any time while this Note remains outstanding,
      the Borrower shall deliver to the Lender written notice thereof (the “Company
      Liquidity Notice”), including a summary of the material terms of such Liquidity
      Event to the Lender not less than 15 days prior to the consummation of such
      Liquidity Event (or such shorter period as may be approved by the Lender).
      Upon
      the consummation of a Liquidity Event and delivery by the Lender of this Note,
      the Lender may direct the Borrower to pay the Lender, in cash, an amount equal
      to the outstanding principal amount of this Note, plus accrued but unpaid
      interest thereon or to convert this Note into equity securities in accordance
      with Section 3(a). The term “Liquidity Event” means the consummation of a
      sale of all or substantially all of the assets of the Borrower, or a
      consolidation or merger of the Borrower, or other transaction or series of
      related transactions, in either case resulting in the disposition of more than
      fifty percent (50%) of the voting power of the Borrower; provided, however,
      that
      a Qualified Financing shall not, in any event, be deemed to be a Liquidity
      Event.

     

    
      
        
          Exhibit A
            - 2

        

      

      
         

        
          

        

      

      
         

        Exhibit
          10.38

      

    

     

    Any
      unpaid payments of principal or interest on this Note shall bear interest from
      their respective maturities, whether scheduled or accelerated, at a rate per
      annum equal to the Default Rate. Borrower shall pay such interest on
      demand.

     

    Interest,
      charges and fees shall be calculated for actual days elapsed on the basis of
      a
      360-day year, which results in higher interest, charge or fee payments than
      if a
      365-day year were used. In no event shall Borrower be obligated to pay interest,
      charges or fees at a rate in excess of the highest rate permitted by applicable
      law from time to time in effect.

     

    If
      Borrower is late in making any payment under this Note by more than five (5)
      days, Borrower agrees to pay a “late charge” of five percent (5%) of the
      installment due, but not less than fifty dollars ($50.00) for any one such
      delinquent payment. This late charge may be charged by Lender for the purpose
      of
      defraying the expenses incidental to the handling of such delinquent amounts.
      Borrower acknowledges that such late charge represents a reasonable sum
      considering all of the circumstances existing on the date of this Note and
      represents a fair and reasonable estimate of the costs that will be sustained
      by
      Lender due to the failure of Borrower to make timely payments. Borrower further
      agrees that proof of actual damages would
      be
      costly and inconvenient. Such late charge shall be paid without prejudice to
      the
      right of Lender to collect any other amounts provided to be paid or to declare
      a
      default under this Note or any of the other Loan Documents or from exercising
      any other rights and remedies of Lender.

     

    This
      Note
      shall be governed by, and construed in accordance with, the laws of the State
      of
      Delaware.

     

    
      	 	
              ASYRMATOS,
                INC.

            
	 	 	 
	 	
              By:

            	
                         
                

            
	 	
              Name:

            	
                               
                

            
	 	
              Its:

            	
                                    
                

            

    

    

    
      
        
          Exhibit A
            - 3*
                  CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED
                  SEPARATELY
                  WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
                  WITH
                  RESPECT TO THE OMITTED PORTIONS.

              

      

       

    

    License
      And Engineering Services Agreement

    Between
      ParkerVision and [*]

     

    This
      Agreement (“Agreement”)
      is
      entered into and made effective as of December 21, 2007 (the “Effective
      Date”)
      by and
      between [*] and ParkerVision, Inc., a Florida corporation with offices at 7915
      Baymeadows Way, Suite 400, Jacksonville, Florida 32256 (“ParkerVision”).

     

    Recitals

     

    WHEREAS,
      ParkerVision has developed and patented technology that is designed to address
      certain limitations in applying traditional approaches to RF transmission,
      reception, and power amplification, and

     

    WHEREAS,
      [*] desires to license from ParkerVision, and ParkerVision desires to license
      to
      [*], such technology, pursuant to the terms and conditions of this Agreement,
      

     

    WHEREAS,
      [*] also desires to have ParkerVision provide, and ParkerVision desires to
      provide, engineering services to [*] with respect to the development by [*]
      of a
      product based on such technology, pursuant to the terms and conditions of this
      Agreement, and

     

    WHEREAS,
      [*] and ParkerVision intend to work together to establish the economic
      feasibility and marketability as a practical matter for [*] of the unique and
      innovative technology that ParkerVision has conceived and developed and is
      continuing to develop;

     

    NOW,
      THEREFORE, in consideration of the foregoing premises and of the performance
      of
      the mutual covenants herein, the parties agree as follows:

     

     

    1. DEFINITIONS

     

    1.1 [*].
      

     

    1.2 “Affiliate”
means
      any entity that directly or indirectly controls, is controlled by or is under
      common control with, as appropriate, ParkerVision or [*]. For purposes of this
      definition, “control”
means
      beneficial ownership of (i) more than fifty percent (50%) of the shares of
      the
      subject entity entitled to vote in the election of directors (or, in the case
      of
      an entity that is not a corporation, for the election of the corresponding
      managing authority); or (ii) such lesser percentage as is the maximum control
      or
      ownership right permitted in the country where the subject entity
      exists.

     

    1.3 “Chipset”
means
      a
      chip or a group of chips designed to work as a unit to perform a function.
      For
      example, a modem chipset contains all the primary circuits for modulating and
      demodulating a signal. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    1.4 “Confidential
      Information”
has
      the
      meaning set forth in Section 12.1. 

     

    1.5 “d2d
      Technology”
means
      Technology developed by ParkerVision that is designed to address certain
      limitations in applying the currently widely used approaches to RF reception.
      

     

    1.6 “d2p
      Technology”
means
      Technology developed by ParkerVision that is designed to address certain
      limitations in applying the currently widely used approaches to RF transmission
      and power amplification.

     

    1.7 “Development
      Tools”
means
      the ParkerVision development tools described in the Statement of Work.

     

    1.8  “Implementation
      Technology”
      means
      any Technology for incorporating or embodying the ParkerVision
      RF Communications Technology into
      a semiconductor device, wireless system or other product which is not based
      on
      the ParkerVision
      RF Communications Technology
      and does not require knowledge of the ParkerVision
      RF Communications Technology. 
      [*].

     

    1.9 “Improvements
      to ParkerVision RF Communications Technology”
means
      any modifications, enhancements and improvements to the ParkerVision RF
      Communications Technology, other than Implementation
      Technology.

     

    1.10 “Intellectual
      Property Rights”
means
      patents, certificates of invention, utility models, design rights and similar
      invention rights, copyrights, trade secret rights, mask work rights, and any
      other intangible property or proprietary rights (other than trademarks, trade
      names, service marks and trade dress rights) recognized anywhere in the world
      under any state or national statute or treaty or common law right, including
      without limitation all applications and registrations with respect to any of
      the
      foregoing. 

     

    1.11 “Licensed
      Patents”
      means:

     

    1.11.1 the
      issued patents listed in Exhibit
      B
      hereto;

     

    1.11.2 any
      and
      all patent(s) that may issue to ParkerVision or its Affiliates based upon the
      United States patent application(s) listed in Exhibit
      B
      hereto;

     

    1.11.3 any
      and
      all patent(s) that may issue to ParkerVision or its Affiliates based upon the
      international patent application(s) listed in Exhibit
      B
      hereto;

     

    1.11.4 [*].

     

    1.11.5 [*].

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    1.11.6 all
      continuations, divisionals, reissues, reexaminations, and substitutions
      (“Continuations”)
      that
      may issue from any of the foregoing based on the subject matter disclosed in
      any
      of the foregoing, provided that such Continuations have Patent Claims covering
      the Licensed Technology. 

     

    ParkerVision
      shall not sell, assign or transfer any patent application to any person or
      entity, other than an Affiliate, for the purpose of avoiding patents issuing
      on
      such application from becoming a “Licensed Patent”. Any sale or disposition of
      the Licensed Patents shall be subject to the licenses granted under this
      Agreement.

     

    1.12 “Licensed
      Process”
means
      any process or method claimed in or practiced by any of the Licensed Patents
      or
      described in any of the Licensed Technology.

     

    1.13 “Licensed
      Product”
means
      Tx Licensed Product, Rx Licensed Product and Tx/Rx Licensed
      Product.

     

    1.13.1 “Rx
      Licensed Product”
means
      a
      Chipset that incorporates or is based on any or all of the Licensed
      Technology, but does not include d2p Technology, and does include
      [.]

     

    1.13.2 “Tx
      Licensed Product”
means
      a
      Chipset that incorporates or is based on any or all of the Licensed Technology,
      but does not include d2d Technology, and does include [*].

     

    1.13.3 “Tx/Rx
      Licensed Product”
means
      a
      Chipset that incorporates or is based on any or all of the Licensed Technology
      and contains both d2p Technology and d2d Technology, and includes all of the
      functional elements named in the definitions of both Rx Licensed Products and
      Tx
      Licensed Products.

     

    1.14 “Licensed
      Technology”
means
      the d2p Technology and d2d Technology as they exist as of the Effective Date,
      as
      well as any ParkerVision
      RF Communications Technology, Improvements to ParkerVision RF Communications
      Technology, and Implementation Technology, which is owned by ParkerVision and
      delivered by ParkerVision to [*] under a Statement of Work.

     

    1.15 “Net
      Sales”
means
      the gross revenue invoiced by [*] or any of its Affiliates based upon any Sales
      of the Licensed Products to unaffiliated third parties, less [*], in each case
      to the extent separately stated on the invoice. No other costs incurred in
      the
      manufacture, sale, distribution, or exploitation of the Licensed Products shall
      be deducted from gross revenue in the calculation of Net Sales. In the case
      of
      sales or other commercial distributions between [*] and its Affiliates or
      between Affiliates of [*], Net Sales shall be calculated on the basis of (i)
      in
      the case of a Licensed Product that is Sold by an Affiliate to an unaffiliated
      third party, the then Net Sales shall be calculated on the basis of that sale,
      and (ii) if a Licensed Product is Sold only to an Affiliate and not further
      Sold
      to an unaffiliated third party, then Net Sales shall be calculated on the basis
      of the most recent previous sale by [*] to an unaffiliated third party.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	
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                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    1.16 “New
      Physical Layer"
      means
      any physical layer that is not a Preexisting [*] Physical Layer. 

     

    1.17 “Open
      Source License Terms”
means
      terms in any license for software which require, as a condition of use,
      modification and/or distribution of such software or other software incorporated
      into, incorporating, derived from or distributed with such software (a
“Work”),
      any
      of the following:

     

    (a)
      the
      making available of source code, object code, or design information regarding
      the Work;

     

    (b)
      the
      granting of permission for creating derivative works regarding the Work;
      or

     

    (c)
      the
      granting of a license to any party under any Intellectual Property Rights in
      or
      to the Work.

     

    By
      means
      of example and without limitation, the following licenses and distribution
      models have Open Source License Terms: the GNU General Public License (GPL),
      the
      GNU Lesser or Library GPL (LGPL), Mozilla Public License (MPL), or any similar
      open source, free software or community licenses.

     

    1.18 “ParkerVision
      RF Communications Technology”
means
      the ParkerVision Technology delivered by ParkerVision to [*] under a Statement
      of Work and consisting of either d2p Technology, d2d Technology, or both d2p
      Technology and d2d Technology. 

     

    1.19 “ParkerVision
      Software”
means
      any software included within the definition of Licensed Technology or developed
      on behalf of [*] pursuant to any SOW, including without limitation the
      ParkerVision RF Communications Technology software engine and any software
      included within the Development Tools.

     

    1.20 “Patent
      Claim”
shall
      have the meaning given to such term under the applicable laws of a patent office
      or jurisdiction and, for purposes of clarification, refers to a portion of
      a
      patent or patent application that defines the scope of protection for an
      invention. 

     

    1.21 “Preexisting
      [*] Physical Layer”
means
      the physical layer of any Preexisting [*] Standard. 

     

    1.22 “Preexisting
      [*] Standards”
shall
      mean each and all of the wireless communication standards administered by and/or
      compliant with regulations issued by [*].

     

    
      
        
        

      

      
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                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    1.23 “Sell”
means
      sell, lease, license or otherwise distribute, provided that Sell does not
      include (a) transfer of up to [*] free units per customer for demonstration
      and
      testing purposes or (b) transfers between Affiliates for non-commercial
      purposes. 

     

    1.24 “SOW”
means
      a
      Statement of Work containing the tasks, deliverables, target delivery dates
      and
      payments set forth in Exhibit
      A
      (including Exhibit
      A-1
      and
Exhibit
      A-2)
      attached
      hereto, as such SOW may be modified on mutual written agreement. There may,
      but
      not necessarily will, be additional sequentially numbered SOWs (e.g., A-3,
      A-4,
      etc.) entered into by the parties under this Agreement. 

     

    1.25 “Technology”
shall
      mean any and all of the following (i) works of authorship including
      computer programs, whether in source code or and executable code form,
      architecture and documentation, (ii) inventions (whether or not
      patentable), discoveries and improvements, (iii) proprietary and
      confidential information, trade secrets and know how, (iv) databases, data
      compilations and collections and technical data, (v) methods and processes,
      and (vi) devices, prototypes, designs and schematics; (vii) simulations and
      analysis related to the foregoing.

     

    1.26 “Update"
      means
      each and every standard which operates using substantially the same physical
      layer as a Preexisting [*] Physical Layer.  This definition is independent
      of the organization that administers and governs the standard, and independent
      of any name given to such standard.  For purposes of clarification of the
      foregoing, any specification that operates using substantially the same physical
      layer as a Preexisting [*] Physical Layer shall be an Update, regardless of
      whether the mode of operation has been renamed, and regardless of whether it
      has
      been merged in text with other standards.  Not withstanding the foregoing,
      a specification that operates using a New Physical Layer is not an Update,
      even
      if included in the same document with an Update, or bearing the name of another
      standard or otherwise characterized as an Update.  The determination of
      whether a particular standard is an Update turns solely on whether the new
      specification operates using a Preexisting [*] Physical Layer or New Physical
      Layer, (with the former being an Update and the latter not being an Update)
      and
      is independent of the nomenclature applied to, or organization of the standards
      text.

     

    1.27 “Vector
      Synthesis Engine”
means
      the portion of the ParkerVision Software consisting of logic implemented in
      digital gates that transform baseband I/Q data vectors into proprietary control
      and baseband signals for the purpose of operating the d2p RF IC such that the
      RF
      IC creates at the RF output amplitude and phase modulated RF
      waveforms.

     

    1.28 [*].

     

    1.29 [*].

     

    
      
        
        

      

      
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                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
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    2. ENGINEERING
      SERVICES AND ACCEPTANCE

     

    2.1 Engineering
      Services.
      

     

    2.1.1 Obligations.
      Subject
      to the terms and conditions set forth in each SOW, ParkerVision shall use
      commercially reasonable efforts to provide the engineering services specified
      in
      the SOW to [*] for the development of a Licensed Product. [*] shall use
      commercially reasonable efforts to fulfill its obligations under each SOW and
      those additional tasks that are necessary and/or appropriate to and reasonably
      required to be performed by [*] given the relationship of the parties in order
      to further develop the Licensed Product into production release. 

     

    2.1.2 Deliverables.
      Subject
      to the terms and conditions set forth in each SOW, deliverables to be provided
      by ParkerVision are set forth in the SOW and include a description of the
      technical approach selected for implementing the Licensed Product, a development
      program plan identifying program tasks, responsibilities, and schedules, the
      completion of development tasks, and the delivery of the Development Tools.
      In
      addition, pursuant to the terms and conditions set forth in any SOW, [*] may
      provide certain testing equipment to ParkerVision.

     

    2.1.3 Deliverables.
      

     

    2.1.3.1.
      Acceptance.
      Upon
      successful completion of, and closure of action items from the review of the
      final deliverable in each SOW (the “Final
      Deliverable”),
      [*]
      shall accept such Final Deliverable provided that if [*] reasonably determines
      after its own testing with such assistance as is reasonably required from
      ParkerVision, that the Final Deliverable comply in all material respects with
      the Final Deliverable requirements set forth in the SOW. If within forty five
      (45) working days of such review, [*] fails to provide ParkerVision with either
      written notice of acceptance or written notice of rejection of the Final
      Deliverable, [*] will be deemed to have accepted such Final
      Deliverable.

     

    2.1.3.2.
      Rejection.
      If [*]
      rejects, in good faith, the Final Deliverable specified in the SOW after [*]
      to
      correct by ParkerVision made within mutually agreeable time periods, then [*]
      may, at its sole option, pursue any of the following options upon provision
      of
      written notice to ParkerVision: 

     

    (i) [*];
      

     

    (ii) [*].
      

     

    The
      parties acknowledge and agree that: (a)  [*],
      in
      its sole and complete discretion, may elect to chose either or both of the
      foregoing remedies as well as all other remedies to which it is entitled
      hereunder; (b) that ParkerVision shall [*]. Notwithstanding the foregoing and
      regardless of the reason therefor, [*].

     

    
      
        
        

      

      
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    2.2 Exchange
      of Deliverables.
      Each
      party shall provide to the other party one (1) copy of any deliverables
      specified in each SOW to be delivered by such party, unless otherwise specified
      in the SOW.

     

    2.3 Project
      Managers.
      Each
      party shall appoint one (1) project manager who will act as a liaison with
      the
      other party for the term of this Agreement.

     

    3. DEVELOPMENT
      TOOLS AND DEVELOPMENT LICENSE

     

    3.1 Software.
      

     

    3.1.1 License
      Grant.
      ParkerVision hereby grants [*] a [*] license to use and reproduce the
      ParkerVision Software as may be reasonably necessary for [*] to incorporate
      such
      ParkerVision Software into one or more Licensed Products that [*], in its sole
      and complete discretion but subject to the terms and conditions hereof, deems
      appropriate.
      [*]
      shall have the right to sublicense to customers the right to use solely those
      portions of ParkerVision Software delivered under each SOW that are necessary
      for the customer to use Licensed Products; provided that in no event shall
      the
      foregoing right to sublicense include the Vector Synthesis Engine; provided,
      further that any such sublicense shall be granted pursuant to the same terms
      and
      conditions (including, by way of example, confidentiality provisions and
      prohibitions on reverse engineering) that apply to [*] software in similar
      circumstances.

     

    3.1.2 No
      Reverse Engineering.
      With
      respect to any third party software provided with the ParkerVision Software,
      [*]
      shall not (a) modify, translate, reverse engineer, decompile, disassemble or
      otherwise attempt (i) to defeat, avoid, bypass, remove, deactivate or
      otherwise circumvent any software protection mechanisms in such third party
      software, including without limitation any such mechanism used to restrict
      or
      control the functionality of such third party software, or (ii) to derive
      the source code or the underlying ideas, algorithms, structure or organization
      from such third party software; or (b) alter, adapt, modify or translate such
      third party software in any way for any purpose, including without limitation
      error correction. Further, [*] shall not distribute, rent, loan, lease, transfer
      or grant any rights in the ParkerVision Software or modifications thereof in
      any
      form to any person or entity for any purpose inconsistent with the terms
      hereof.

     

    3.2 [*].
      Upon
      [*] request, ParkerVision agrees to provide to [*] pursuant to mutually
      agreeable terms and conditions [*] as described in each SOW, and, in addition,
      [*] may provide pursuant to mutually agreeable terms and conditions certain
      [*].
      Each party agrees to use items delivered to it by the other party solely for
      the
      purposes consistent with this Agreement, agrees not to dispose of items
      delivered to it by the other party hereunder and/or pursuant to any SOW (by
      sale, transfer or otherwise) without the prior written consent of the delivering
      party, and agrees not to disclose or use such items in any manner inconsistent
      with the limitations imposed upon such use and disclosure by the party
      delivering the item. Shipment of the [*] shall be F.O.B. ParkerVision’s facility
      or such other terms as stated in the relevant SOW. The risk shall pass in
      accordance with the terms of sale.

     

    
      
        
        

      

      
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    4. SUPPORT

     

    After
      completion of each party’s tasks specified in each SOW and acceptance by [*] of
      [*] under the SOW (if [*] does in fact accept such deliverable), ParkerVision
      shall provide to [*] reasonable support with respect to the use, functioning
      and
      implementation of the ParkerVision
      RF
      Communications Technology into a Licensed Product as [*] may request from time
      to time, subject to the reasonable availability of ParkerVision personnel and
      resources. 

     

    5. OWNERSHIP

     

    5.1 ParkerVision.
      

     

    5.1.1 Subject
      to the license granted herein, ParkerVision retains all right, title and
      interest in and to the ParkerVision RF Communications Technology developed
      prior
      to, or outside the scope of, this Agreement, and in and to any Improvements
      to
      ParkerVision RF Communications Technology and Implementation Technology that
      may
      be made, invented, authored, developed or otherwise created solely by
      ParkerVision or its employees under this Agreement. 

     

    5.1.2 [*].
      

     

    5.2 [*].
      

     

    5.2.1 [*].
      

     

    5.2.2 [*].

     

    5.2.3 [*].

     

    
      
        
        

      

      
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                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    6. GRANT
      OF LICENSES

     

    6.1 Licensed
      Patents and Licensed Technology.
      

     

    6.1.1 Grant.
      Subject
      to the terms and conditions of this Agreement, ParkerVision grants to [*],
      a [*]
      license (with no right to sublicense), under the Licensed Patents and any
      copyrights, trade secrets and mask work rights (recognized anywhere in the
      world
      under any state or national statute or treaty or common law right, including
      without limitation all applications and registrations with respect to any of
      the
      foregoing) in and to the Licensed Technology owned or licensable by
      ParkerVision, to use, modify, reproduce [*] (except as set forth below) of
      the
      Licensed Technology in order to develop Licensed Products or to have any third
      party, subject to the provisions hereof, perform any or all of the foregoing
      for
      [*], and to make, have made, use, sell, offer for sale and import Licensed
      Products; and to practice any Licensed Process involved in the manufacture
      or
      use thereof. 

     

    6.1.2 Have
      Made Rights.
      [*]
      understands and acknowledges that the “have made” rights granted in Section
      6.1.1 extend only to Licensed Products that are made by a third party for the
      use, sale, offer for sale and/or import by or on behalf of [*] and (A) for
      which
      the Licensed Product will be branded by [*], or any Affiliate of [*], or (B)
      where (whether branded by [*] or not) both
      (i) the designs, specifications and working drawings for the manufacture of
      the
      Licensed Product to be manufactured by that third party are furnished by [*]
      and
      (ii) such designs, specifications and working drawings are in sufficient detail
      that no material additional design work is required by the third party, other
      than adaptation to the production processes and standards normally used by
      that
      third party, provided such adaptation only changes the characteristics of such
      Licensed Products to an extent that is not material.
      Upon
      written request from ParkerVision, [*] shall promptly inform ParkerVision in
      writing whether and to what extent any manufacturer identified by ParkerVision
      is operating under the Licensed Patents pursuant to [*]'s “have made” rights
      granted under Section 6.1.1 subject to [*]. 

     

    6.2 No
      Other Licenses.
      Except
      as expressly set forth in Sections 3.1.1 or this Section 6 or Section 7, no
      license or other right is granted herein by either party to the other party,
      directly or by implication, estoppel or otherwise, and no such license or other
      right will arise from the consummation of this Agreement or from any acts,
      statements or dealings leading to such consummation. 

     

    6.3 [*].
      

     

    6.3.1 [*].
      

     

    6.3.2 [*].

     

    7. [*]

     

    
      
        
        

      

      
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    8. PATENTS

     

    ParkerVision
      hereby represents that the issued patents and patent applications listed on
      Exhibit
      B
      include
      all issued patents and patent applications owned by ParkerVision and its
      Affiliates as of the Effective Date that have Patent Claims covering the
      Licensed Technology. 

     

    9. PUBLIC
      ANNOUNCEMENT

     

    9.1  Consent
      Required.
      Neither
      party shall make any public announcement about this Agreement without the prior,
      written consent of the other party, which consent shall not be unreasonably
      withheld or delayed. The parties agree that it shall not be deemed to be
      unreasonable for [*] to withhold consent to any public announcement that
      identifies [*] if [*] believes that identification of [*] would
      [*].

     

    9.2 Exception.
      Notwithstanding the foregoing, either of the parties may at any time make
      announcements which are required by applicable law, regulatory bodies, or stock
      exchange or stock association rules, so long as such party so required to make
      the announcement, promptly upon learning of such requirement, notifies the
      other
      party of such requirement and discusses with the other party in good faith
      the
      exact wording of any such announcement.

     

    9.3 Indemnity.
      ParkerVision shall, at its expense, defend, indemnify and hold [*] harmless
      from
      and against any claims or allegations that [*]. [*] shall promptly notify
      ParkerVision of any claim or allegation under this Section 9.3, give
      ParkerVision the sole right to control the defense or settlement thereof, and
      give ParkerVision reasonable cooperation and assistance in connection therewith.
      ParkerVision shall not settle any claim that requires [*] to admit any liability
      or pay any money without [*]’s prior written consent. ParkerVision shall not be
      responsible for any costs or expenses incurred without its prior written
      consent. 

     

    10. FEES
      AND PAYMENT

     

    10.1 Engineering
      Services.

     

    10.1.1 Support.
      For
      support services provided to [*] pursuant to Section 4 of this Agreement, [*]
      agrees to pay ParkerVision [*]. All Support fees are due within sixty (60)
      days
      of invoice date. 

     

    10.1.2 [*].
      The
      price for the [*], if any, is as specified in the SOW. Payment is due within
      sixty (60) days of the invoice date.

     

    10.2 Royalties.

     

    10.2.1 [*]
      shall
      pay ParkerVision royalties [*] of Licensed Products Sold as
      follows:

     

    
      
        
        

      

      
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    10.2.1.1. For
      Rx
      Licensed Products and Tx Licensed Products, [*] will pay royalties
      [*].

     

    10.2.1.2. For
      Tx/Rx
      Licensed Products, [*] will pay royalties [*].

     

    10.2.2 [*]

     

    10.2.2.1. [*].
      

     

    10.2.2.2. [*].
      

     

    10.2.3 [*]
      shall
      pay ParkerVision a non-refundable pre-paid royalties in the amount of [*],
      which
      amount shall be due and payable in full within sixty (60) days of the Sale
      of
      the [*] unit of Licensed Products. This prepaid royalty payment constitutes
      advance payment of the royalties set forth in this Section and will reduce
      [*]’s
      obligation to pay therefore on a dollar for dollar basis.

     

    10.2.4 [*].
      

     

    10.2.5 When
      Royalties Become Payable.
      Royalties shall be calculated and paid for each calendar quarter with respect
      to
      Net Sales during that calendar quarter, less Net Sales for Licensed Products
      returned to [*] for which (i) [*] refunded the purchase price and (ii) a royalty
      was previously paid by [*] to ParkerVision. Royalties due by [*] for each
      calendar quarter shall be reported to ParkerVision within forty-five (45) days
      following the end of each calendar quarter and shall be accompanied by the
      reports described in Section 11 below, and the payment of such royalties shall
      be sixty (60) calendar days after the end of each calendar quarter. In no event
      will [*] be entitled to any refund of
      any royalties previously paid.  

     

    10.2.6 Payment
      Terms.
      All
      payments made hereunder shall be in United States Dollars and may be made,
      at
      ParkerVision’s option as conveyed to [*] in no less than ten (10) calendar days
      prior to the date of payment, by wire transfer or check. Royalties based on
      sales in other currencies shall be converted to United States Dollars according
      to the official rate of exchange for that currency, as published in any credible
      and widely used reference source, including, without limitation, the official
      government bank of the nation in which the denominated sales were made [*],
      the
      Wall Street Journal, Yahoo Financial, or other, similar publication on the
      last
      day of the calendar month in which the royalty accrued (or, if not published
      on
      that day, the last publication day for the Wall Street Journal during that
      month).

     

    10.3 Late
      Payment Charges.
      [*]
      shall pay ParkerVision a late fee on all amounts not paid by the date due set
      forth herein equal to [*].

     

    
      
        
        

      

      
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                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    10.4 Taxes.
      All
      payments by [*] shall be made free and clear of, and without reduction for,
      any
      and all taxes, including, without limitation, sales, use, property, license,
      value added, excise, franchise, income, withholding or similar taxes, other
      than
      such taxes which are imposed by any government or any political subdivision
      thereof based on the net income of ParkerVision. Any such taxes which are
      otherwise imposed on payments to ParkerVision shall be the sole responsibility
      of [*]. [*] shall provide ParkerVision with copies of official receipts issued
      by the appropriate taxing authority or such other evidence as is reasonably
      requested by ParkerVision to establish that such taxes have been
      paid.

     

    11. REPORTS
      AND AUDIT

     

    11.1 Records
      and Royalty Reports.
      [*]
      shall keep accurate records of its operations respecting the Sale, of the
      Licensed Products by [*] to the extent necessary (i) for the royalties payable
      hereunder to be determined, or (ii) to inform ParkerVision of all Licensed
      Products Sold, or otherwise distributed by [*], including without limitation
      for
      testing, qualifications and evaluation purposes, for a period of no less than
      five (5) years after such records are generated. Such records shall include,
      without limitation, records of the quantity of such Licensed Products. [*]
      shall
      prepare quarterly written reports of the same, disclosing the quantity of such
      Licensed Products Sold, or otherwise distributed by [*] and showing the amount
      of royalties due for such quarter, and shall submit such reports to ParkerVision
      within [*] after the end of each quarter of a calendar year in which sales
      subject to the royalty provided for in Section 10, above are made. 

     

    11.2 Audit.
      Upon at
      least [*] advance, written notice and no more frequently than once per calendar
      year, ParkerVision shall have the right, at its own expense, to examine such
      records through an independent representative during [*]'s ordinary business
      hours to the extent reasonably necessary to confirm or correct such reports.
      Such inspections shall be made by an international auditing firm that does
      not
      and has not for the past three (3) years provide other accounting or financial
      services to ParkerVision, which representative may furnish to ParkerVision
      only
      its conclusions as to the accuracy of such reports, as to any discrepancies
      therein, and as to any adjustment necessary to be made to provide for payment
      of
      the proper amount of royalties, but not any other information of [*] gleaned
      in
      the course of such audit. ParkerVision shall identify the international auditing
      firm in advance of the audit in writing, and [*] shall approve the international
      auditing firm in advance, which approval shall not be unreasonably withheld
      and
      shall be granted in any event if the international auditing firm meets the
      criteria set forth above. In addition, as a condition to being granted any
      access to [*]'s record, such international auditing firm shall, on its own
      behalf and on behalf of all of its agents, execute a nondisclosure agreement
      reasonably acceptable to [*]. In the event that any examination by such mutually
      agreed upon international auditing firm reveals that [*] has underpaid royalties
      due to ParkerVision by [*] or more which underpayment is in excess of [*],
      then
      [*] shall reimburse ParkerVision for the reasonable cost of such audit. [*]
      shall further promptly pay to ParkerVision any additional royalties due after
      the receipt of written notice by ParkerVision of [*]’s underpayment. With
      respect to any underpayments more than [*] old, [*] agrees to pay interest
      on
      such underpayments at the lowest rate that [*] is currently paying, or has
      most
      recently paid, for a loan from a commercial bank as of the date the audit
      reveals such underpayment. All information disclosed under this
      Section 11.2 shall be deemed [*] Confidential Information and shall be used
      for the sole purpose of verifying proper reporting of Licensed Products and
      proper payment of royalties. The auditors shall not spend more than [*] in
      [*]'s
      premises unless it is not reasonably possible to complete the audit within
      such
      time period, in which case the auditors may remain in [*]'s premises only for
      such period of time as is reasonably necessary to complete their
      work. 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    11.3 Maintenance
      of Records.
      [*]
      shall maintain all records relating to the sale, lease or other distribution
      of
      the Licensed Products during the term of this Agreement for a period of five
      years after the termination of this Agreement, after which [*] shall have no
      obligation to maintain, and ParkerVision shall have no right to inspect, any
      such records.

     

    12. CONFIDENTIAL
      INFORMATION

     

    12.1 “Confidential
      Information”
means,
      with respect to either party, any confidential business or technical
      information, including know-how, whether or not patentable or copyrightable,
      that the disclosing party identifies as confidential or proprietary at the
      time
      it is disclosed or delivered to the receiving party. The ParkerVision
      RF
      Communications Technology, the Licensed Technology and the contents of any
      unpublished Licensed Patents and patent applications listed in Exhibit
      B
      shall in
      any event be deemed the Confidential Information of ParkerVision. Further,
      any
      [*] shall be deemed the Confidential Information of the developing party and
      except as otherwise set forth in this Agreement, such party shall have no
      obligation to disclose such [*] to the other party.

     

    12.2 Exceptions.
      Confidential Information does not include any information that the receiving
      party can demonstrate by written records: (a) was known to the receiving
      party prior to its disclosure hereunder by the disclosing party; (b) is
      independently developed by the receiving party; (c) is or becomes publicly
      known through no wrongful act of the receiving party; (d) has been
      rightfully received from a third party whom the receiving party has reasonable
      grounds to believe is authorized to make such disclosure without restriction;
      or
      (e) has been approved for public release by the disclosing party’s prior
      written authorization. Each party may disclose any Confidential Information
      as
      required to be produced or disclosed pursuant to applicable law, regulation
      or
      court order, provided that the receiving party provides prompt advance notice
      thereof to enable the disclosing party to seek a protective order or otherwise
      prevent such disclosure. In addition, each party may disclose the existence
      and
      terms of this Agreement in confidence in connection with [*]or [*], or to the
      extent required by law in connection with a public offering of such party’s
      securities pursuant to Section 9.

     

    12.3 Non-Disclosure
      and Non-Use.
      Each
      party will: (i) not use any Confidential Information of the other party except
      in the performance of the Engineering Services Agreement or as permitted by
      this
      Agreement; (ii) not disclose any such Confidential Information to any person
      or
      entity other than its own employees, consultants and contractors who have a
      need
      to know and who have executed in advance of receiving such Confidential
      Information a suitable nondisclosure and restricted use agreement that comports
      with the applicable provisions of this Agreement; (iii) not disclose any source
      code of the ParkerVision Software (other than source code of driver software)
      to
      any third party, including without limitation, consultants or contractors of
      [*], other than independent contractors of [*] retained directly by [*] or
      through a staffing or temporary agency, who have been issued a [*] personnel
      badge in accordance with [*]’s standard human-resource practices and who
      predominately work on-site at [*]’s facilities, and provided any such disclosure
      is strictly in accordance with Section 12.3(ii) above; and (iv) use all
      reasonable efforts to keep such Confidential Information strictly confidential.
      Each party will use reasonable efforts to enforce such nondisclosure and
      restricted use agreements.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    13. PATENT
      MARKING

     

    [*]
      agrees to mark the documentation associated with the Licensed Products with
      the
      number(s) of the Licensed Patent(s) covering such Licensed Products and with
      “Patent Pending” (along with a listing of the relevant patent application
      numbers) if any patent applications relating to such Licensed Products are
      pending before the United States Patent and Trademark Office or the patent
      office of a foreign country, as applicable, as such Licensed Patent number(s)
      and reasonable guidelines for use are provided by ParkerVision to [*] for this
      purpose and updated from time to time.

     

    14. TERM

     

    This
      Agreement shall commence on the Effective Date and continue until
      [*].

     

    15. TERMINATION

     

    15.1 Termination
      for Breach.
      At any
      time after the occurrence of an Event of Default, this Agreement may be
      terminated at the election of the Non-Defaulting Party, effective as of the
      date
      specified in a notice of termination provided to the Defaulting Party. As used
      herein, “Event
      of Default”
means
      one or more of the following events: if there should occur a material breach,
      default or noncompliance by one party (the “Defaulting
      Party”)
      of or
      with any term or condition hereof followed by written notice of such breach,
      default or noncompliance from the other party (the “Non-Defaulting
      Party”)
      and
      the failure of the Defaulting Party to remedy or correct such breach, default
      or
      noncompliance within [*] after receipt of such notice (the “Cure
      Period”).
      

     

    15.2 Termination
      upon [*] Challenge to the Licensed Patents.
      ParkerVision may terminate this Agreement upon written notice to [*] in the
      event [*] leads or actively participates in (other than as required by law
      or
      court order) any effort to challenge the validity, enforceability or scope
      of
      any Licensed Patent. [*] will not be entitled to any refund of any royalties
      previously paid.

     

    
      
        
        

      

      
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              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    15.3 Effect
      of Termination or Expiration. 

     

    15.3.1 Cease
      Use of Technology and Return Materials.
      In the
      event this Agreement expires or is terminated by either party, then all licenses
      granted to [*] will automatically cease as of the date of termination, provided,
      however, that:

     

    15.3.1.1. For
      such
      time as is reasonably required, as a practical matter, and subject to the
      payment of royalties under Section 10, [*] shall have the right to Sell off
      any
      Licensed Products in inventory, except that [*] shall not have such rights
      to
      Sell off any Licensed Products in inventory in the event this Agreement is
      terminated by ParkerVision under Section 15.1 or 15.2; and

     

    15.3.1.2. Upon
      termination or expiration of this Agreement and except as otherwise provided
      herein or otherwise as reasonably required for the performance of either Party's
      obligations hereunder or use of the license granted hereunder, each party shall
      return to the other party or destroy all copies of the technology, materials
      and
      information provided to it by the other party hereunder, or any portion thereof,
      in its possession or control.

     

    15.3.2 Payment
      of Royalties.
      Upon
      any expiration or termination becoming effective, [*] will, within [*]
      thereafter, or otherwise as they become due, pay all royalties and other fees
      hereunder and interest owed ParkerVision as of the date of such termination
      or
      expiration. 

     

    15.4 Survival
      of Certain Provisions.
      The
      provisions of Sections 1, 3.1.2, 5, 6.2, 7, 10.4, 11, 12, 13, 16.2, and 17-19
      of
      this Agreement will survive any expiration or termination of this Agreement.
      

     

    16. WARRANTIES
      

     

    16.1 Warranties.

     

    16.1.1 Warranties
      by ParkerVision.
      ParkerVision hereby represents and warrants to [*] that: (a) it has the full
      right, power and authority to enter into this Agreement and grant the licenses
      granted hereunder; (b) this Agreement is a valid and binding obligation of
      such
      party; (c) it has obtained and shall maintain throughout the term of this
      Agreement all necessary licenses, authorizations, approvals and consents to
      enter into and perform its obligations hereunder in compliance with all
      applicable laws, rules and regulations; and (d) as of the Effective Date and
      to
      its knowledge, the Licensed Technology does not infringe any Intellectual
      Property Rights of any third party. 

     

    16.1.2 Warranties
      by [*].
      [*]
      hereby represents and warrants to ParkerVision that: (a) it has the full right,
      power and authority to enter into this Agreement and grant the licenses granted
      hereunder; (b) this Agreement is a valid and binding obligation of such party;
      and (c) it has obtained and shall maintain throughout the term of this Agreement
      all necessary licenses, authorizations, approvals and consents to enter into
      and
      perform its obligations hereunder in compliance with all applicable laws, rules
      and regulations. [*]
      represents and warrants that [*] shall not act in any manner that would require
      any ParkerVision Software to be licensed under Open Source License
      Terms. 

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    16.2 Disclaimer
      of Other Warranties.
      EXCEPT
      AS SET FORTH IN SECTION 16.1, NEITHER PARTY MAKES ANY WARRANTIES TO THE OTHER,
      EITHER EXPRESS, IMPLIED OR STATUTORY, AND EACH PARTY HEREBY DISCLAIMS ANY AND
      ALL SUCH WARRANTIES, INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF
      MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT. Nothing
      contained in this Agreement shall be construed as (i) a warranty or
      representation by ParkerVision as to the validity and/or scope of any Licensed
      Patent; (ii) imposing upon ParkerVision any obligation to institute any suit
      or
      action for infringement of any Licensed Patent; or (iii) imposing on
      ParkerVision any obligation to file any patent application or to secure any
      patent or maintain any patent in force. 

     

    17. INDEMNIFICATION

     

    17.1 ParkerVision
      Obligations. 

     

    17.1.1 Intellectual
      Property Indemnity.
      Subject
      to prompt, written notification by [*], cooperation by [*] and control of all
      litigation and/or settlement by ParkerVision, ParkerVision shall defend [*]
      from
      and against any third party claims brought against [*] alleging that any
      ParkerVision RF Communications Technology incorporated into Licensed Products
      or
      otherwise used by [*] in accordance with the terms hereof infringes or
      misappropriates any patent, copyright or trade secret of any third party. [*]
      agrees to notify ParkerVision promptly of any matters in respect to which the
      foregoing indemnity in this Section 17.1.1 may apply. If notified in writing
      of
      any action or claim for which ParkerVision is to provide the foregoing
      indemnity, [*]. Notwithstanding the foregoing, ParkerVision shall obtain [*]’s
      advance written consent, which shall not be unreasonably withheld or delayed,
      if
      [*] is required to incur or admit liability as a result of such settlement
      by
      ParkerVision.

     

    17.1.2 Remedy
      in the Event of Prohibition of Use.
      If a
      preliminary or final judgment is, or is reasonably likely to be, entered against
      [*]’s use, sale, lease or distribution of a Licensed Product that incorporates
      any ParkerVision RF Communications Technology, due to infringement of any third
      party patents, copyrights or trade secrets by the ParkerVision RF Communications
      Technology, or if ParkerVision reasonably believes that the ParkerVision RF
      Communications Technology may be found to infringe any third party patents,
      copyrights or trade secrets, then ParkerVision shall, at its sole discretion
      and
      expense, either (a) modify the ParkerVision RF Communications Technology so
      that
      such technology becomes noninfringing, (b) substitute the ParkerVision RF
      Communications Technology with other non-infringing technology with materially
      the same functionality (or better) as the infringing ParkerVision RF
      Communications Technology or parts or (c) obtain a license to permit [*] to
      exercise the rights granted hereunder; provided, however, that in the event
      that
      ParkerVision is unable after [*] to accomplish either (a), (b) or (c), then
      [*]
      agrees to cease any and all use, sale, lease and distribution of any Licensed
      Product that incorporates such ParkerVision RF Communications Technology within
      [*] of receipt of notice from ParkerVision or such earlier time as may be
      required to comply with a court order. 

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    
      	
              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    17.2 Limitation
      of Indemnification Liability.
      In no
      event shall ParkerVision be liable under Section 17.1 for any infringement
      or
      misappropriation: (i) by any product or technology not provided and
      licensed by ParkerVision hereunder; or (ii) arising from a combination
      with, addition to, or modification of the ParkerVision RF Communications
      Technology by anyone other than ParkerVision. 

     

    17.3 Sole
      Remedy.
      THIS
      SECTION 17 STATES THE SOLE AND EXCLUSIVE LIABILITY OF THE PARTIES FOR
      INFRINGEMENT OR ALLEGATIONS OF INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS
      OF
      THIRD PARTIES FOR ANY PRODUCT OR TECHNOLOGY PROVIDED HEREUNDER, AND IS IN LIEU
      OF ALL WARRANTIES, EXPRESS, IMPLIED OR STATUTORY IN REGARD THERETO, INCLUDING
      BUT NOT LIMITED TO THE WARRANTY AGAINST
      INFRINGEMENT SPECIFIED IN THE UNIFORM COMMERCIAL CODE. 

     

    18. LIMITATION
      OF LIABILITY

     

    18.1 Consequential
      Damages.
      IN NO
      EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR LOST PROFITS OR ANY SPECIAL,
      INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES (EXCEPT TO THE EXTENT
      THAT SUCH LOST PROFITS OR SUCH DAMAGES CONSTITUTE THE MEASURE OF DIRECT DAMAGES
      UNDER THE RELEVANT INTELLECTUAL PROPERTY LAWS, EXCEPT FOR A BREACH OF EITHER
      PARTY’S CONFIDENTIALITY OBLIGATIONS UNDER SECTION 12 OF THIS AGREEMENT, AND
      EXCEPT FOR AMOUNTS PAYABLE TO THIRD PARTIES UNDER SECTION 17), HOWEVER CAUSED
      AND ON ANY THEORY OF LIABILITY, ARISING IN ANY WAY IN CONNECTION WITH THIS
      AGREEMENT. THIS LIMITATION WILL APPLY EVEN IF SUCH PARTY HAS BEEN ADVISED OF
      THE
      POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE
      OF ANY LIMITED REMEDY.

     

    18.2 Damages
      Cap.
      IN NO
      EVENT WILL EITHER PARTY’S LIABILITY ARISING IN ANY WAY IN CONNECTION WITH THIS
      AGREEMENT (INCLUDING WITHOUT LIMITATION ANY DAMAGES, SETTLEMENT OR LICENSE
      FEES
      OWED BY PARKERVISION UNDER SECTION 17 OF THIS AGREEMENT) EXCEED [*]. HOWEVER,
      THE FOREGOING LIMITATION OF LIABILITY IN THIS SECTION 18.2 SHALL NOT APPLY
      WITH
      RESPECT TO (i) EITHER PARTY’S BREACH, OR EXCEEDING THE SCOPE, OF THE LICENSE
      RIGHTS GRANTED TO SUCH PARTY UNDER SECTIONS 3.1.1, 6 OR Error!
      Reference source not found.
      OF THIS
      AGREEMENT, AND (ii) EITHER PARTY’S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS
      UNDER SECTION 12 OF THIS AGREEMENT.

     

    
      
        
        

      

      
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                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    19. GENERAL
      PROVISIONS

     

    19.1 Assignment.
      This
      Agreement may not be assigned in whole or in part by either
      party
      without the written consent of the other, which consent will not be unreasonably
      withheld, except that [*] or ParkerVision may assign this Agreement in
      connection with a merger, reorganization, change of control or sale of all
      or
      substantially all of its assets or business to which this Agreement
      relates.

     

    19.2 Notice.

     

    19.2.1 Unless
      otherwise changed by notice in writing from [*] to ParkerVision,
      ParkerVision shall serve notice upon [*] as follows:

     

    [*]

    

    Unless
      otherwise changed by notice in writing from ParkerVision to [*], [*] shall
      serve
      notice upon ParkerVision as follows:

    

    CEO

    ParkerVision,
      Inc.

    7915
      Baymeadows Way, Suite 400

    Jacksonville,
      Florida 32256

    

    With
      copy
      to: 

    

    CFO

    ParkerVision,
      Inc.

    7915
      Baymeadows Way, Suite 400

    Jacksonville,
      Florida 32256

     

    19.2.2 Notice
      shall be by regular or priority mail, recognized commercial overnight courier,
      hand delivery, facsimile transmission or electronic mail with proof of receipt,
      and shall be effective as of the date received.

     

    19.3 Severability.
      If any
      paragraph or provision of this Agreement shall be deemed void or invalid as
      a
      matter of law, the remaining paragraphs or provisions of this Agreement shall
      nevertheless remain in full force and effect.

     

    19.4 No
      Joint Venture, etc.
      Nothing
      herein shall be deemed to constitute ParkerVision and [*] as partners, joint
      venturers or otherwise associated in or with the business of the other. Neither
      party shall be liable for any debts, accounts, obligations or other liabilities
      of the other party. Neither party is authorized to incur any debts or other
      obligations of any kind on the part of or as agent for the other except as
      may
      be specifically authorized in writing.

     

    
      
        
        

      

      
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              *
                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    19.5 Waiver.
      No
      relaxation, forbearance, delay or negligence by any party hereto in enforcing
      any of the terms and conditions of this Agreement, or the granting of time
      by
      any party to another, shall operate as a waiver or prejudice, affect or restrict
      the rights, powers or remedies of any party hereto.

     

    19.6 Complete
      Agreement.
      This
      Agreement and the Exhibits attached hereto represent the full and complete
      agreement and understanding of the parties hereto with respect to the subject
      matter hereof. Any amendment thereof must be in writing and executed by the
      parties hereto. 

     

    19.7 Governing
      Law.
      All
      questions of law, rights, and remedies regarding any act, event or occurrence
      undertaken prior to or pursuant to this Agreement shall be governed by and
      construed in accordance with the laws of the State of [*], without regard to
      or
      application of choice of law rules or principles, and the United States.
The
      parties agree that all proceedings, disputes and claims concerning the
      interpretation or the performance of this Agreement, including questions
      involving its existence, validity and duration shall be subject to the exclusive
      jurisdiction of federal courts in the State of [*], and the parties voluntarily
      subject themselves to the jurisdiction of such courts.
      

     

    19.8 Compliance
      with Export Control Laws. 
      Each party agrees to comply with all applicable export and reexport control
      laws
      and regulations, including the Export Administration Regulations (“EAR”)
      maintained by the United States Department of Commerce.  Specifically, each
      party covenants that it shall not - directly or indirectly - sell, export,
      reexport, transfer, divert, or otherwise dispose of any software, source code,
      or technology (including products derived from or based on such technology)
      received from the other party under this Agreement to any country (or any
      individual national thereof) subject to antiterrorism controls or U.S. embargo,
      or to any other person, entity, or destination prohibited by the laws or
      regulations of the United States, without obtaining prior authorization from
      the
      competent government authorities as required by those laws and
      regulations. 

     

    19.9 Multiple
      Counterparts.
      This
      Agreement may be executed in multiple counterparts, each of which will be
      considered an original and all of which together will constitute one agreement.
      This Agreement may be executed by the attachment of signature pages which have
      been previously executed.

     

    19.10  Remedies
      Cumulative.
      Except
      as expressly provided herein, all rights and remedies enumerated in this
      Agreement will be cumulative and none will exclude any other right or remedy
      permitted herein or by law or in equity.

     

    19.11  Headings.
      The
      headings contained in this Agreement are inserted for convenience of reference
      only and are not intended to be a part of or to affect the meaning or
      interpretation of this Agreement.

     

    
      
        
        

      

      
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                CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
                WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
                RESPECT TO THE OMITTED PORTIONS.

            

    

     

    19.12 Force
      Majeure.
      No
      party shall be responsible or liable to another party for nonperformance or
      delay in performance of any terms or conditions of this Agreement due to acts
      or
      occurrences beyond the reasonable control of the nonperforming or delayed party,
      including but not limited to, acts of God, acts of government, wars, riots,
      strikes or other labor disputes, fires and floods, provided the nonperforming
      or
      delayed party provides to the other party written notice of the existence and
      the reason for such nonperformance or delay. Notwithstanding the foregoing,
      the
      other party may terminate this agreement if such nonperformance or delay extends
      for a period greater than ninety (90) days. 

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement through their duly
      authorized representatives as set forth below:

     

    
      
        	
                [*]

              	
                ParkerVision,
                  Inc.

              
	 	 
	
                 

              	
                 

              
	
                Signature:
                  /s/                                   
                      

              	
                Signature:
                  /s/ Jeffrey Parker  

              
	
                 

              	
                 

              
	
                Printed
                  Name: [*]

              	
                Printed
                  Name: Jeffrey Parker

              
	
                 

              	
                 

              
	
                Title:
                  [*]

              	
                Title:
                  Chief Executive Officer

              

      

       

    

    
      
        
        

      

      
        20

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