Document:

Exhibit 10.5

EXHIBIT
10.5

Behringer
Harvard Opportunity REIT I, Inc.

2004
Incentive Award Plan

Section
1.

Purpose

The purpose of this
Plan is to promote the interests of the Company by providing the opportunity to
purchase or receive Shares, to receive Units, or to receive compensation that is
based upon appreciation in the value of Shares or Units to Eligible Recipients
in order to attract and retain Eligible Recipients by providing an incentive to
work to increase the value of Shares and Units and a stake in the future of the
Company that corresponds to the stake of each of the Company's stockholders. The
Plan provides for the grant of Incentive Stock Options, Non-Qualified Stock
Options, Restricted Stock Awards, Restricted Stock Units, Restricted Unit
Awards, and Stock Appreciation Rights to aid the Company in obtaining these
goals.

Section
2.

Definitions

Each term set forth
in this Section shall have the meaning set forth opposite such term for purposes
of this Plan and any Incentive Award Agreements under this Plan (unless noted
otherwise), and for purposes of such definitions, the singular shall include the
plural and the plural shall include the singular, and reference to one gender
shall include the other gender. Note that some definitions may not be used in
this Plan, and may be inserted here solely for possible use in Incentive Award
Agreements issued under this Plan.

2.1      
Affiliate means BHO
Partners, LLC, Behringer Harvard Opportunity OP I, LP, Behringer Harvard
Opportunity Advisors I LP, Behringer Harvard Partners, LLC, Behringer Securities
LP, and HPT Management Services LP.

2.2      
Board means the Board of
Directors of the Company.

2.3      
Cause shall mean an act
or acts by an Eligible Recipient involving (a) the use for profit or disclosure
to unauthorized persons of confidential information or trade secrets of the
Company, a Parent or a Subsidiary, (b) the breach of any contract with the
Company, a Parent or a Subsidiary, (c) the violation of any fiduciary obligation
to the Company, a Parent or a Subsidiary, (d) the unlawful trading in the
securities of the Company, a Parent or a Subsidiary, or of another corporation
based on information gained as a result of the performance of services for the
Company, a Parent or a Subsidiary, (e) a felony conviction or the failure to
contest prosecution of a felony, or (f) willful misconduct, dishonesty,
embezzlement, fraud, deceit or civil rights violations, or other unlawful
acts.

2.4      
Change
of Control means either of
the following:

(a)    any transaction or
series of transactions pursuant to which the Company sells, transfers, leases,
exchanges or disposes of substantially all (i.e., at least
eighty-five percent (85%)) of its assets for cash or property, or for a
combination of cash and property, or for other consideration; or

(b)    any transaction
pursuant to which persons who are not current stockholders of the Company
acquire by merger, consolidation, reorganization, division or other business
combination or transaction, or by a purchase of an interest in the Company, an
interest in the Company so that after such transaction, the stockholders of the
Company immediately prior to such transaction no longer have a controlling
(i.e., 50% or more)
voting interest in the Company.

2.5      
Code means the Internal
Revenue Code of 1986, as amended.

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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2.6      
Committee means any
committee appointed by the Board to administer the Plan, as specified in Section
5 hereof. Any such committee shall be comprised entirely of
Directors.

2.7      
Common
Stock means the common
stock of the Company.

2.8      
Company means Behringer
Harvard Opportunity REIT I, Inc., a Maryland corporation, and any successor to
such organization. 

2.9      
Constructive
Discharge means a
termination of employment with the Company by an Employee due to any of the
following events if the termination
occurs within thirty (30) days of such event:

(a)      
Forced
Relocation or Transfer. The Employee may
continue employment with the Company, a Parent or a Subsidiary (or a successor
employer), but such employment is contingent on the Employee’s being transferred
to a site of employment which is located further than 50 miles from the
Employee’s current site of employment. For this purpose, an Employee’s site of
employment shall be the site of employment to which they are assigned as their
home base, from which their work is assigned, or to which they report, and shall
be determined by the Committee in its sole discretion on the basis of the facts
and circumstances.

(b)      
Decrease in
Salary or Wages. The Employee may
continue employment with the Company, a Parent or a Subsidiary (or a successor
employer), but such employment is contingent upon the Employee’s acceptance of a
salary or wage rate which is less than the Employee’s prior salary or wage
rate.

(c)      
Significant and
Substantial Reduction in Benefits. The Employee may
continue employment with the Company, a Parent or a Subsidiary (or a successor
employer), but such employment is contingent upon the Employee’s acceptance of a
reduction in the pension, welfare or fringe benefits provided which is both
significant and substantial when expressed as a dollar amount or when expressed
as a percentage of the Employee’s cash compensation. The determination of
whether a reduction in pension, welfare or fringe benefits is significant and
substantial shall be made on the basis of all pertinent facts and circumstances,
including the entire benefit (pension, welfare and fringe) package provided to
the Employee, and any salary or wages paid to the Employee. However,
notwithstanding the preceding, any modification or elimination of benefits which
results solely from the provision of new benefits to an Employee by a successor
employer as a result of a change of the Employee’s employment from employment
with the Company to employment with such successor shall not be deemed a
Significant and Substantial Reduction in Benefits where such new benefits are
identical to the benefits provided to similarly situated Employees of the
successor.

2.10      
Director means a member of
the Board. 

2.11      
Eligible
Recipient means an Employee
and/or a Key Person.

2.12      
Employee means a common law
employee of the Company, a Subsidiary, a Parent or an Affiliate. 

2.13      
Exchange
Act means the
Securities Exchange Act of 1934, as amended. 

2.14    
  Exercise
Price means the price
that shall be paid to purchase one (1) Share upon the exercise of an Option
granted under this Plan. 

2.15     
Fair
Market Value of each Share on
any date means the price determined below as of the close of business on such
date (provided, however, if for any reason, the Fair Market Value per share
cannot be ascertained or is unavailable for such date, the Fair Market Value per
share shall be determined as of the nearest preceding date on which such Fair
Market Value can be ascertained): 

(a)      
If the
Share is listed or traded on any established stock exchange or a national market
system, including without limitation the National Market of the National
Association of Securities Dealers, Inc. Automated Quotation ("NASDAQ") System,
its Fair Market Value shall be the closing sale price for the
Share

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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(or the mean of the
closing bid and ask prices, if no sales were reported), on such exchange or
system on the date of such determination, as reported in The Wall Street Journal
or such other source as the Board deems reliable; or

(b)        
If the
Share is not listed or traded on any established stock exchange or a national
market system, its Fair Market Value shall be the average of the closing dealer
"bid" and "ask" prices of a Share as reflected on the NASDAQ interdealer
quotation system of the National Association of Securities Dealers, Inc. on the
date of such determination; or

(c)        
In the
absence of an established public trading market for the Share, the Fair Market
Value of a Share shall be determined in good faith by the Board.

2.16      
FLSA
Exclusion means the
provisions of Section 7(e) of the Fair Labor Standards Act of 1938 (the “FLSA”)
that exempt certain stock-based compensation from inclusion in overtime
determinations under the FLSA. 

2.17      
Incentive
Award means an ISO, a
NQSO, a Restricted Stock Award, a Restricted Stock Unit, a Restricted Unit
Award, or a Stock Appreciation Right. 

2.18      
Incentive
Award Agreement means an agreement
between the Company, a Parent or a Subsidiary, and a Participant evidencing an
award of an Incentive Award. 

2.19      
Initial
Limited Partner shall mean HPT
Management LP, a Texas limited partnership.

2.20      
Insider means an
individual who is, on the relevant date, an officer, director or ten percent
(10%) beneficial owner of any class of the Company’s equity securities that is
registered pursuant to Section 12 of the Exchange Act, all as defined under
Section 16 of the Exchange Act. 

2.21      
ISO means an option
granted under this Plan to purchase Shares that is intended by the Company to
satisfy the requirements of Code §422 as an incentive stock option.

2.22      
Key
Person means (1) a member
of the Board who is not an Employee, or (2) a consultant or advisor; provided,
however, that such consultant or advisor must be a natural person who is
providing or will be providing bona
fide services to the
Company, a Subsidiary, a Parent or an Affiliate, with such services (1) not
being in connection with the offer or sale of securities in a capital-raising
transaction, and (2) not directly or indirectly promoting or maintaining a
market for securities of the Company, a Subsidiary, a Parent or an Affiliate,
within the meaning of the general instructions to SEC Form S-8. 

2.23      
NQSO means an option
granted under this Plan to purchase Shares that is not intended by the Company
to satisfy the requirements of Code §422. 

2.24      
Option means an ISO or a
NQSO. 

2.25      
Outside
Director means a Director
who is not an Employee and who qualifies as (1) a “non-employee director” under
Rule 16b-3(b)(3) under the 1934 Act, as amended from time to time, and (2) an
“outside director” under Code §162(m) and the regulations promulgated
thereunder. 

2.26      
Parent means any corporation
(other than the corporation employing a Participant) in an unbroken chain of
corporations ending with the corporation employing a Participant if, at the time
of the granting of the Incentive Award, each of the corporations other than the
corporation employing the Participant owns stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the
other corporation in such chain. However, for
purposes of interpreting any Incentive Award Agreement issued under this Plan as
of a date of determination, Parent shall mean any corporation
(other than the corporation employing a Participant) in an unbroken chain of
corporations ending with the corporation employing a Participant if, at the time
of the granting of the Incentive Award and thereafter through such date of
determination, each of the corporations other than the corporation employing the
Participant owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporation in
such chain.

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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2.27      
Participant means an
individual who receives an Incentive Award hereunder. 

2.28      
Performance-Based
Exception means the
performance-based exception from the tax deductibility limitations of Code
§162(m). 

2.29      
Plan means the
Behringer Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan, as may be
amended from time to time. 

2.30      
Restricted
Stock Award means an award of
Shares granted to a Participant under this Plan whereby the Participant has
immediate rights of ownership in the Shares underlying the award, but such
Shares are subject to restrictions in accordance with the terms and provisions
of this Plan and the Incentive Award Agreement pertaining to the award and may
be subject to forfeiture by the individual until the earlier of (a) the time
such restrictions lapse or are satisfied, or (b) the time such shares are
forfeited, pursuant to the terms and provisions of the Incentive Award Agreement
pertaining to the award. 

2.31      
Restricted
Stock Unit means a
contractual right granted to a Participant under this Plan to receive a Share
that is subject to restrictions of this Plan and the applicable Incentive Award
Agreement. 

2.32      
Restricted
Unit Award means an award of
Units granted to a Participant under this Plan whereby the Participant has
immediate rights of ownership in the Units underlying the award, but such Units
are subject to restrictions in accordance with the terms and provisions of this
Plan and the Incentive Award Agreement pertaining to the award and may be
subject to forfeiture by the individual until the earlier of (a) the time such
restrictions lapse or are satisfied, or (b) the time such shares are forfeited,
pursuant to the terms and provisions of the Incentive Award Agreement pertaining
to the award.

2.33      
SAR
Exercise Price means the amount
per Share specified in an Incentive Award Agreement with respect to a Stock
Appreciation Right, the excess of the Fair Market Value of a Share over and
above such amount, the holder of such Stock Appreciation Right may be able to
receive upon the exercise or payment of such Stock Appreciation Right.

2.34      
Share means a share of
the Common Stock of the Company. 

2.35      
Stock
Appreciation Right means a right
granted to a Participant pursuant to the terms and provisions of this Plan
whereby the individual, without payment to the Company (except for any
applicable withholding or other taxes), receives cash, Shares, a combination
thereof, or such other consideration as the Board may determine, in an amount
equal to the excess of the Fair Market Value per Share on the date on which the
Stock Appreciation Right is exercised over the exercise price per Share noted in
the Stock Appreciation Right for each Share subject to the Stock Appreciation
Right. 

2.36      
Subsidiary means any corporation
(other than the corporation employing such Participant) in an unbroken chain of
corporations beginning with the corporation employing such Participant if, at
the time of the granting of the Incentive Award, each of the corporations other
than the last corporation in the unbroken chain owns stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain. However, for
purposes of interpreting any Incentive Award Agreement issued under this Plan as
of a date of determination, Subsidiary shall mean any corporation
(other than the corporation employing such Participant) in an unbroken chain of
corporations beginning with the corporation employing such Participant if, at
the time of the granting of the Incentive Award and thereafter through such date
of determination, each of the corporations other than the last corporation in
the unbroken chain owns stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

2.37      
Ten
Percent Stockholder means a person who
owns (after taking into account the attribution rules of Code §424(d)) more than
ten percent (10%) of the total combined voting power of all classes of shares of
stock of either the Company, a Subsidiary or a Parent. 

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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2.38      
Unit shall mean a
“Profits Interest Unit” that represents the right to receive profits and
appreciation earned by, or which inure to, the Initial Limited Partner after the
date of issuance of such Unit.

Section
3.

Shares
& Units Subject to Incentive Awards

Shares
Subject to Incentive Awards. The total number
of Shares that may be issued pursuant to Incentive Awards under this Plan (and
the total number of Shares that may be issued pursuant to the exercise of ISOs
under this Plan) shall not exceed eleven million, as adjusted pursuant to
Section 10. Such Shares shall be reserved, to the extent that the Company deems
appropriate, from authorized but unissued Shares, and from Shares which have
been reacquired by the Company. Furthermore, any Shares subject to an Incentive
Award that remain after the cancellation, expiration or exchange of such
Incentive Award thereafter shall again become available for use under this Plan.
Notwithstanding anything herein to the contrary, no Participant may be granted
Incentive Awards covering an aggregate number of Shares in excess of five
million in any calendar year, and any Shares subject to an Incentive Award which
again become available for use under this Plan after the cancellation,
expiration or exchange of such Incentive Award thereafter shall continue to be
counted in applying this calendar year Participant limitation.

Section
4.

Effective
Date

The effective date
of this Plan shall be the date it is adopted by the Board, as noted in
resolutions effectuating such adoption, provided the stockholders of the Company
approve this Plan within twelve (12) months after such effective date. If such
effective date comes before such stockholder approval, any Incentive Awards
granted under this Plan before the date of such approval automatically shall be
granted subject to such approval. 

Section
5.

Administration

5.1      
General
Administration. This Plan shall be
administered by the Board. The Board, acting in its absolute discretion, shall
exercise such powers and take such action as expressly called for under this
Plan. The Board shall have the power to interpret this Plan and, subject to the
terms and provisions of this Plan, to take such other action in the
administration and operation of the Plan as it deems equitable under the
circumstances. The Board's actions shall be binding on the Company, on each
affected Eligible Recipient, and on each other person directly or indirectly
affected by such actions.

5.2      
Authority
of the Board. Except as limited
by law or by the Articles of Incorporation or Bylaws of the Company, and subject
to the provisions herein, the Board shall have full power to select Eligible
Recipients who shall participate in the Plan, to determine the sizes and types
of Incentive Awards in a manner consistent with the Plan, to determine the terms
and conditions of Incentive Awards in a manner consistent with the Plan, to
construe and interpret the Plan and any agreement or instrument entered into
under the Plan, to establish, amend or waive rules and regulations for the
Plan’s administration, and to amend the terms and conditions of any outstanding
Incentive Awards as allowed under the Plan and such Incentive Awards. Further,
the Board may make all other determinations that may be necessary or advisable
for the administration of the Plan.

5.3      
Delegation
of Authority. The Board may
delegate its authority under the Plan, in whole or in part, to a Committee
appointed by the Board consisting of not less than one
(1) Director or to one or more other persons to whom the powers of the Board
hereunder may be delegated in accordance with applicable law. The members of the
Committee and any other persons to whom authority has been delegated shall be
appointed from time to time by, and shall serve at the discretion of, the Board.
The Committee or other delegate (if appointed) shall act according to the
policies and procedures set forth in the Plan and to those policies and
procedures established by the Board, and the Committee or other delegate shall
have such

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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powers and
responsibilities as are set forth by the Board. Reference to the Board in this
Plan shall specifically include reference to the Committee or other delegate
where the Board has delegated its authority to the Committee or other delegate,
and any action by the Committee or other delegate pursuant to a delegation of
authority by the Board shall be deemed an action by the Board under the Plan.
Notwithstanding the above, the Board may assume the powers and responsibilities
granted to the Committee or other delegate at any time, in whole or in part.
With respect to Committee appointments and composition, only a Committee (or a
sub-committee thereof) comprised solely of two (2) or more Outside Directors may
grant Incentive Awards that will meet the Performance-Based Exception, and only
a Committee comprised solely of Outside Directors may grant Incentive Awards to
Insiders that will be exempt from Section 16(b) of the Exchange Act.

5.4      
Decisions
Binding. All determinations
and decisions made by the Board (or its delegate) pursuant to the provisions of
this Plan and all related orders and resolutions of the Board shall be final,
conclusive and binding on all persons, including the Company, its stockholders,
Directors, Eligible Recipients, Participants, and their estates and
beneficiaries, and the Initial Limited Partner, its partners, and their estates
and beneficiaries.

5.5      
Indemnification
for Decisions. No member of the
Board or the Committee (or a sub-committee thereof) shall be liable in
connection with or by reason of any act or omission performed or omitted to be
performed on behalf of the Company in such capacity, provided, that the Board
has determined, in good faith, that the course of conduct that caused the loss
or liability was in the best interests of the Company. Service on the Committee
(or a sub-committee thereof) shall constitute service as a director of the
Company so that the members of the Committee (or a sub-committee thereof) shall
be entitled to indemnification and reimbursement as directors of the Company
pursuant to its articles of incorporation, bylaws and applicable law. In
addition, the members of the Board, Committee (or a sub-committee thereof) shall
be indemnified by the Company against the following losses or liabilities
reasonably incurred in connection with or by reason of any act or omission
performed or omitted to be performed on behalf of the Company in such capacity,
provided, that the Board has determined, in good faith, that the course of
conduct which caused the loss or liability was in the best interests of the
Company: (a) the reasonable expenses, including attorneys’ fees actually and
necessarily incurred in connection with the defense of any action, suit or
proceeding, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan, any Incentive
Award granted hereunder, and (b) against all amounts paid by them in settlement
thereof (provided such settlement is approved by independent legal counsel
selected by the Company) or paid by them in satisfaction of a judgment in any
such action, suit or proceeding, except in relation to matters as to which it
shall be adjudged in such action, suit or proceeding that such individual is
liable for gross negligence or misconduct in the performance of his duties,
provided that within 60 days after institution of any such action, suit or
proceeding a Committee member or delegatee shall in writing offer the Company
the opportunity, at its own expense, to handle and defend the same. The Company
shall not indemnify or hold harmless the member of the Board or the Committee
(or a subcommittee thereof) if: (a) in the case of a director (other than an
independent director of the Company), the loss or liability was the result of
negligence or misconduct by the director, or (b) in the case that the director
is an independent director of the Company, the loss or liability was the result
of gross negligence or willful misconduct by the director. Any indemnification
of expenses or agreement to hold harmless may be paid only out of the net assets
of the Company, and no portion may be recoverable from the
Stockholders.

5.6      
Units
as Incentive Awards. To the extent that
any Incentive Awards involve Units, the Board, acting for the Company as manager
of the Initial Limited Partner, shall cause the Initial Limited Partner to issue
Units pursuant to the terms and provisions of the Plan.

Section
6.

Eligibility

Eligible Recipients
selected by the Board shall be eligible for the grant of Incentive Awards under
this Plan, but no Eligible Recipient shall have the right to be granted an
Incentive Award under this Plan merely as a result of his or her status as an
Eligible Recipient. Only Employees of the Company, a Parent or a Subsidiary,
shall be eligible to receive a grant of ISO’s.

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Section
7

Terms of
Incentive Awards

7.1      
Terms
and Conditions of All Incentive Awards.

(a)      
Grants of
Incentive Awards. The Board, in its
absolute discretion, shall grant Incentive Awards under this Plan from time to
time and shall have the right to grant new Incentive Awards in exchange for
outstanding Incentive Awards, including, but not limited to, exchanges of Stock
Options for the purpose of achieving a lower Exercise Price. Incentive Awards
shall be granted to Eligible Recipients selected by the Board, and the Board
shall be under no obligation whatsoever to grant any Incentive Awards, or to
grant Incentive Awards to all Eligible Recipients, or to grant all Incentive
Awards subject to the same terms and conditions.

(b)      
Shares &
Units Subject to Incentive Awards. The number of
Shares or Units as to which an Incentive Award shall be granted shall be
determined by the Board in its sole discretion, subject to the provisions of
Section 3 as to the total number of Shares available for grants under the
Plan. 

(c)      
Incentive Award
Agreements. Each Incentive
Award shall be evidenced by an Incentive Award Agreement executed by the
Company, a Parent or a Subsidiary, and the Participant, which shall be in such
form and contain such terms and conditions as the Board in its discretion may,
subject to the provisions of the Plan, from time to time determine.

(d)      
Date of
Grant. The date an
Incentive Award is granted shall be the date on which the Board (1) has approved
the terms and conditions of the Incentive Award Agreement, (2) has determined
the recipient of the Incentive Award and the number of Shares or Units covered
by the Incentive Award and (3) has taken all such other action necessary to
direct the grant of the Incentive Award.

	 	
      7.2
	
      Terms
      and Conditions of Options. 
      

(a)      
Necessity of
Incentive Award Agreements. Each grant of an
Option shall be evidenced by an Incentive Award Agreement that shall specify
whether the Option is an ISO or NQSO, and incorporate such other terms and
conditions as the Board, acting in its absolute discretion, deems consistent
with the terms of this Plan, including (without limitation) a restriction on the
number of Shares subject to the Option that first become exercisable during any
calendar year. The Board and/or the Company shall have complete discretion to
modify the terms and provisions of an Option in accordance with Section 12 of
this Plan even though such modification may change the Option from an ISO to a
NQSO.

(b)      
Determining
Optionees. In determining
Eligible Recipient(s) to whom an Option shall be granted and the number of
Shares to be covered by such Option, the Board may take into account the
recommendations of the Chief Executive Officer of the Company and its other
officers, the duties of the Eligible Recipient, the present and potential
contributions of the Eligible Recipient to the success of the Company, and other
factors deemed relevant by the Board, in its sole discretion, in connection with
accomplishing the purpose of this Plan. An Eligible Recipient who has been
granted an Option to purchase Shares, whether under this Plan or otherwise, may
be granted one or more additional Options. If the Board grants an ISO and a NQSO
to an Eligible Recipient on the same date, the right of the Eligible Recipient
to exercise one such Option shall not be conditioned on his or her failure to
exercise the other such Option.

(c)      
Exercise
Price. Subject to
adjustment in accordance with Section 10 and the other provisions of this
Section, the Exercise Price shall be as set forth in the applicable Incentive
Award Agreement.  With respect to each grant of an ISO to a Participant who
is not a Ten Percent Stockholder, the Exercise Price shall not be less than the
Fair Market Value on the date the ISO is granted. With respect to each grant of
an ISO to a Participant who is a Ten Percent Stockholder, the Exercise Price
shall not be less than one hundred ten percent (110%) of the Fair Market Value
on the date the ISO is granted. If an Option is a NQSO, the Exercise Price for
each Share shall be no less than (1) the minimum price required by applicable
state law, or (2) the minimum price required by the Company's governing
instrument, or (3) $0.01, whichever price is greater. Any Option intended to
meet the Performance-Based Exception must be granted with an

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Exercise Price
equivalent to or greater than the Fair Market Value of the Shares subject
thereto determined as of the date of such grant. Any Option intended to meet the
FLSA Exclusion must be granted with an Exercise Price equivalent to or greater
than eighty-five percent (85%) of the Fair Market Value of the Shares subject
thereto on the date granted determined as of the date of such grant. Any Option
that is intended to avoid taxation under Code §409A as a “nonqualified deferred
compensation plan” must be granted with an Exercise Price equivalent to or
greater than the Fair Market Value of the Shares subject thereto determined as
of the date of such grant.

(d)      
Option
Term.  Each Option
granted under this Plan shall be exercisable in whole or in part at such time or
times as set forth in the related Incentive Award Agreement, but no Incentive
Award Agreement shall:

(i)      
make
an Option exercisable before the date such Option is granted; or

(ii)      
make
an Option exercisable after the earlier of:

	 	
      (A)
	
      the date such
      Option is exercised in full, or

(B)      
the
date that is the tenth (10th) anniversary of the date such Option is granted, if
such Option is a NQSO or an ISO granted to a non-Ten Percent Stockholder, or the
date that is the fifth (5th) anniversary of the date such Option is granted, if
such Option is an ISO granted to a Ten Percent Stockholder. An Incentive Award
Agreement may provide for the exercise of an Option after the employment of an
Employee has terminated for any reason whatsoever, including death or
disability. The Employee’s rights, if any, upon termination of employment will
be set forth in the applicable Incentive Award Agreement. 

(e)      
Payment.  Options
shall be exercised by the delivery of a written notice of exercise to the
Company, setting forth the number of Shares with respect to which the Option is
to be exercised accompanied by full payment for the Shares. Payment for shares
of Stock purchased pursuant to exercise of an Option shall be made in cash or,
unless the Incentive Award Agreement provides otherwise, by delivery to the
Company of a number of Shares that have been owned and completely paid for by
the holder for at least six (6) months prior to the date of exercise
(i.e., “mature shares”
for accounting purposes) having an aggregate Fair Market Value equal to the
amount to be tendered, or a combination thereof. In addition, unless the
Incentive Award Agreement provides otherwise, the Option may be
exercised through a brokerage transaction following registration of the
Company's equity securities under Section 12 of the Exchange Act as permitted
under the provisions of Regulation T applicable to cashless exercises
promulgated by the Federal Reserve Board, unless prohibited by Section 402 of
the Sarbanes-Oxley Act of 2002. However, notwithstanding the foregoing, with
respect to any Option recipient who is an Insider, a tender of shares or a
cashless exercise must (1) have met the requirements of an exemption under Rule
16b-3 promulgated under the Exchange Act, or (2) be a subsequent transaction the
terms of which were provided for in a transaction initially meeting the
requirements of an exemption under Rule 16b-3 promulgated under the Exchange
Act. Unless the
Incentive Award Agreement provides otherwise, the foregoing exercise payment
methods shall be subsequent transactions approved by the original grant of an
Option. Except as provided
in subparagraph (f) below, payment shall be made at the time that the
Option or any part thereof is exercised, and no Shares shall be issued or
delivered upon exercise of an Option until full payment has been made by the
Participant.  The holder of an Option, as such, shall have none of the
rights of a stockholder. 

(f)      
Conditions to
Exercise of an Option.  Each Option
granted under the Plan shall vest and shall be exercisable at such time or
times, or upon the occurrence of such event or events, and in such amounts, as
the Board shall specify in the Incentive Award Agreement; provided, however,
that subsequent to the grant of an Option, the Board, at any time before
complete termination of such Option, may accelerate the time or times at which
such Option may vest or be exercised in whole or in part. Notwithstanding the
foregoing, an Option intended to meet the FLSA Exclusion shall not be
exercisable for at least six (6) months following the date it is granted, except
by reason of death, disability, retirement, a change in corporate ownership or
other circumstances permitted under regulations promulgated under the FLSA
Exclusion. Furthermore, if the recipient of an Option receives a hardship
distribution from a Code §401(k) plan of the Company, or any Parent or
Subsidiary, the Option may not be exercised during the six (6) month period
following the hardship distribution, unless the Company determines that such
exercise would not jeopardize the

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tax-qualification
of the Code §401(k) plan. The Board may impose such restrictions on any Shares
acquired pursuant to the exercise of an Option as it may deem advisable,
including, without limitation, vesting or performance-based restrictions, rights
of the Company to re-purchase Shares acquired pursuant to the exercise of an
Option, voting restrictions, investment intent restrictions, restrictions on
transfer, “first refusal” rights of the Company to purchase Shares acquired
pursuant to the exercise of an Option prior to their sale to any other person,
“drag along” rights requiring the sale of shares to a third party purchaser in
certain circumstances, “lock up” type restrictions in the case of an initial
public offering of the Company’s stock, restrictions or limitations or other
provisions that would be applied to stockholders under any applicable agreement
among the stockholders, and restrictions under applicable federal securities
laws, under the requirements of any stock exchange or market upon which such
Shares are then listed and/or traded, and/or under any blue sky or state
securities laws applicable to such Shares. 

(g)      
Transferability
of Options.  An Option
shall not be transferable or assignable except by will or by the laws of descent
and distribution and shall be exercisable, during the Participant's lifetime,
only by the Participant; provided, however, that in the event the Participant is
incapacitated and unable to exercise his or her Option, if such Option is a
NQSO, such Option may be exercised by such Participant's legal guardian, legal
representative, or other representative whom the Board deems appropriate based
on applicable facts and circumstances. The determination of incapacity of a
Participant and the determination of the appropriate representative of the
Participant who shall be able to exercise the Option if the Participant is
incapacitated shall be determined by the Board in its sole and absolute
discretion. Notwithstanding the foregoing, except as otherwise provided in the
Incentive Award Agreement, a NQSO may also be transferred by a Participant as a
bona fide gift (i) to his spouse, lineal descendant or lineal ascendant,
siblings and children by adoption, (ii) to a trust for the benefit of one or
more individuals described in clause (i) and no other persons, or (iii) to a
partnership of which the only partners are one or more individuals described in
clause (i), in which case the transferee shall be subject to all provisions of
the Plan, the Incentive Award Agreement and other agreements with the
Participant in connection with the exercise of the Option and purchase of
Shares. In the event of such a gift, the Participant shall promptly notify the
Board of such transfer and deliver to the Board such written documentation as
the Board may in its discretion request, including, without limitation, the
written acknowledgment of the donee that the donee is subject to the provisions
of the Plan, the Incentive Award Agreement and other agreements with the
Participant. 

(h)      
Special
Provisions for Certain Substitute Options. 
Notwithstanding anything to the contrary in this Section, any Option in
substitution for a stock option previously issued by another entity, which
substitution occurs in connection with a transaction to which Code §424(a)
is applicable, may provide for an exercise price computed in accordance with
Code §424(a) and the regulations thereunder and may contain such other terms and
conditions as the Board may prescribe to cause such substitute Option to contain
as nearly as possible the same terms and conditions (including the applicable
vesting and termination provisions) as those contained in the previously issued
stock option being replaced thereby. 

(i)      
ISO Tax
Treatment Requirements. With respect to
any Option that purports to be an ISO, to the extent that the aggregate Fair
Market Value (determined as of the date of grant of such Option) of stock with
respect to which such Option is exercisable for the first time by any individual
during any calendar year exceeds one hundred thousand dollars ($100,000.00),
such Option shall not be treated as an ISO in accordance with Code §422(d). The
rule of the preceding sentence is applied in the order in which Options are
granted. Also, with respect to any Option that purports to be an ISO, such
Option shall not be treated as an ISO if the Participant disposes of shares
acquired thereunder within two (2) years from the date of the granting of the
Option or within one (1) year of the exercise of the Option, or if the
Participant has not met the requirements of Code §422(a)(2).

(j)      
Potential
Repricing of Stock Options. With respect to
any Option granted pursuant to, and under, this Plan, the Board (or a committee
thereof) may determine that the repricing of all or any portion of existing
outstanding Options is appropriate without the need for any additional approval
of the Stockholders of the Company. For this purpose, “repricing” of Options
shall include, but not be limited to, any of the following actions (or any
similar action): (1) lowering the Exercise Price of an existing Option; (2) any
action which would be treated as a “repricing” under generally accepted
accounting principles; or (3) canceling of an existing Option at a time when its
Exercise Price exceeds the Fair Market Value of the underlying stock subject to
such Option, in exchange for another Option, a Restricted Stock Award, or other
equity in the Company. 

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7.3      
Terms
and Conditions of Stock Appreciation Rights. A Stock
Appreciation Right may be granted in connection with all or any portion of a
previously or contemporaneously granted Option or not in connection with an
Option.  A Stock Appreciation Right shall entitle the Participant to
receive upon exercise or payment the excess of the Fair Market Value of a
specified number of Shares at the time of exercise, over a SAR Exercise
Price that shall be not less than the Exercise Price for that number of Shares
in the case of a Stock Appreciation Right granted in connection with a
previously or contemporaneously granted Option, or in the case of any other
Stock Appreciation Right, not less than one hundred percent (100%) of the Fair
Market Value of that number of Shares at the time the Stock Appreciation Right
was granted. The exercise of a Stock Appreciation Right shall result in a pro
rata surrender of the related Option to the extent the Stock Appreciation Right
has been exercised.

(a)      
Payment. Upon exercise or
payment of a Stock Appreciation Right, the Company shall pay to the Participant
the appreciation in cash or Shares (at the aggregate Fair Market Value on the
date of payment or exercise) as provided in the Incentive Award Agreement or, in
the absence of such provision, as the Board may determine. To the extent that a
Stock Appreciation Right is paid in cash, it shall nonetheless be deemed paid in
Shares for purposes of Section 3 hereof.

(b)      
Conditions to
Exercise. Each Stock
Appreciation Right granted under the Plan shall be exercisable at such time or
times, or upon the occurrence of such event or events, and in such amounts, as
the Board shall specify in the Incentive Award Agreement; provided, however,
that subsequent to the grant of a Stock Appreciation Right, the Board, at any
time before complete termination of such Stock Appreciation Right, may
accelerate the time or times at which such Stock Appreciation Right may be
exercised in whole or in part. The exercisability of a Stock Appreciation Right
that is intended to avoid taxation under Code §409A as a “nonqualified deferred
compensation plan” must be carefully restricted in accordance with Code §409A
requirements. Furthermore, if the recipient of a Stock Appreciation Right
receives a hardship distribution from a Code §401(k) plan of the Company, or any
Parent or Subsidiary, the Stock Appreciation Right may not be exercised during
the six (6) month period following the hardship distribution, unless the Company
determines that such exercise would not jeopardize the tax-qualification of the
Code §401(k) plan. 

(c)      
Transferability
of Stock Appreciation Rights. Except as
otherwise provided in a Participant’s Incentive Award Agreement, no Stock
Appreciation Right granted under the Plan may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Further, except as otherwise provided in a
Participant’s Incentive Award Agreement, all Stock Appreciation Rights granted
to a Participant under the Plan shall be exercisable, during the Participant's
lifetime, only by the Participant; provided,
however, that in the event
the Participant is incapacitated and unable to exercise his or her Stock
Appreciation Right, such Stock Appreciation Right may be exercised by such
Participant's legal guardian, legal representative, or other representative whom
the Board deems appropriate based on applicable facts and circumstances in
accordance with the terms and provisions of the Incentive Award Agreement
governing such Stock Appreciation Right.. The determination of incapacity of a
Participant and the determination of the appropriate representative of the
Participant shall be determined by the Board in its sole and absolute
discretion. Notwithstanding the foregoing, except as otherwise provided in the
Incentive Award Agreement, (A) a Stock Appreciation Right which is granted in
connection with the grant of a NQSO may be transferred, but only with the NQSO,
and (B) a Stock Appreciation Right which is not granted in connection with the
grant of a NQSO, may be transferred by the Participant as a bona fide gift (i)
to his spouse, lineal descendant or lineal ascendant, siblings and children by
adoption, (ii) to a trust for the benefit of one or more individuals described
in clause (i), or (iii) to a partnership of which the only partners are one or
more individuals described in clause (i), in which case the transferee shall be
subject to all provisions of the Plan, the Incentive Award Agreement and other
agreements with the Participant in connection with the exercise of the Stock
Appreciation Right. In the event of such a gift, the Participant shall promptly
notify the Board of such transfer and deliver to the Board such written
documentation as the Board may in its discretion request, including, without
limitation, the written acknowledgment of the donee that the donee is subject to
the provisions of the Plan, the Incentive Award Agreement and other agreements
with the Participant in connection with the exercise of the Stock Appreciation
Right.

(d)      
Special
Provisions for Tandem SAR’s. A Stock
Appreciation Right granted in connection with an Option may only be exercised to
the extent that the related Option has not been exercised. 

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A Stock
Appreciation Right granted in connection with an ISO (1) will expire no later
than the expiration of the underlying ISO, (2) may be for no more than the
difference between the exercise price of the underlying ISO and the Fair Market
Value of the Shares subject to the underlying ISO at the time the Stock
Appreciation Right is exercised, (3) may be transferable only when, and under
the same conditions as, the underlying ISO is transferable, and (4) may be
exercised only (i) when the underlying ISO could be exercised and (ii) when the
Fair Market Value of the Shares subject to the ISO exceeds the exercise price of
the ISO.

(e)      
Code §409A
Requirements. A Stock
Appreciation Right must meet certain restrictions contained in Code §409A if it
is to avoid taxation under Code §409A as a “nonqualified deferred compensation
plan.” No Stock Appreciation Right should be granted under this Plan without
careful consideration of the impact of Code §409A with respect to such grant
upon both the Company and the recipient of the Stock Appreciation
Right.

7.4      
Terms
and Conditions of Restricted Stock Awards. 

(a)      
Grants of
Restricted Stock Awards. Shares awarded
pursuant to Restricted Stock Awards shall be subject to such restrictions as
determined by the Board for periods determined by the Board.  Restricted
Stock Awards issued under the Plan may have restrictions which lapse based upon
the service of a Participant, or based upon the attainment (as determined by the
Board) of performance goals established pursuant to the business criteria listed
in Section 14, or based upon any other criteria that the Board may determine
appropriate. Any Restricted Stock Award which becomes exercisable based on the
attainment of performance goals must be granted by a Committee, must have its
performance goals determined by such a Committee based upon one or more of the
business criteria listed in Section 14, and must have the attainment of such
performance goals certified in writing by such a Committee in order to meet the
Performance-Based Exception. The Board may require a cash payment from the
Participant in exchange for the grant of a Restricted Stock Award or may grant a
Restricted Stock Award without the requirement of a cash payment; provided,
however, if the recipient of a Restricted Stock Award receives a hardship
distribution from a Code §401(k) plan of the Company, or any Parent or
Subsidiary, the recipient may not pay any amount for such Restricted Stock Award
during the six (6) month period following the hardship distribution, unless the
Company determines that such payment would not jeopardize the tax-qualification
of the Code §401(k) plan.

(b)      
Acceleration of
Award. The Board shall
have the power to permit, in its discretion, an acceleration of the expiration
of the applicable restrictions or the applicable period of such restrictions
with respect to any part or all of the Shares awarded to a Participant.

(c)      
Necessity of
Incentive Award Agreement. Each grant of a
Restricted Stock Award shall be evidenced by an Incentive Award Agreement that
shall specify the terms, conditions and restrictions regarding the Shares
awarded to a Participant, and shall incorporate such other terms and conditions
as the Board, acting in its absolute discretion, deems consistent with the terms
of this Plan. The Board shall have complete discretion to modify the terms and
provisions of Restricted Stock Awards in accordance with Section 12 of this
Plan.

(d)      
Restrictions on
Shares Awarded. Shares awarded
pursuant to Restricted Stock Awards shall be subject to such restrictions as
determined by the Board for periods determined by the Board. The Board may
impose such restrictions on any Shares acquired pursuant to a Restricted Stock
Award as it may deem advisable, including, without limitation, vesting or
performance-based restrictions, rights of the Company to re-purchase Shares
acquired pursuant to the Restricted Stock Award, voting restrictions, investment
intent restrictions, restrictions on transfer, “first refusal” rights of the
Company to purchase Shares acquired pursuant to the Restricted Stock Award prior
to their sale to any other person, “drag along” rights requiring the sale of
shares to a third party purchaser in certain circumstances, “lock up” type
restrictions in connection with public offerings of the Company’s stock,
restrictions or limitations or other provisions that would be applied to
stockholders under any applicable agreement among the stockholders, and
restrictions under applicable federal securities laws, under the requirements of
any stock exchange or market upon which such Shares are then listed and/or
traded, and/or under any blue sky or state securities laws applicable to such
Shares.

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(e)      
Transferability
of Restricted Stock Awards. A Restricted Stock
Award may not be transferred by the holder Participant, except upon the death of
the holder Participant by will or by the laws of descent and
distribution.

(f)      
Voting,
Dividend & Other Rights. Unless the
applicable Incentive Award Agreement provides otherwise, holders of Restricted
Stock Awards shall be entitled to vote and shall receive dividends during the
periods of restriction. 

7.5      
Terms
and Conditions of Restricted Stock Units. 

(a)      
Grants of
Restricted Stock Units. A Restricted Stock
Unit shall entitle the Participant to receive one Share at such future time and
upon such terms as specified by the Board in the Incentive Award Agreement
evidencing such award. Restricted Stock Units issued under the Plan may have
restrictions which lapse based upon the service of a Participant, or based upon
other criteria that the Board may determine appropriate. The Board may require a
cash payment from the Participant in exchange for the grant of Restricted Stock
Units or may grant Restricted Stock Units without the requirement of a cash
payment; provided, however, if the recipient of a Restricted Stock Unit receives
a hardship distribution from a Code §401(k) plan of the Company, or any Parent
or Subsidiary, no payment for the Restricted Stock Unit may be made by the
recipient during the six (6) month period following the hardship distribution,
unless the Company determines that such payment would not jeopardize the
tax-qualification of the Code §401(k) plan. 

(b)      
Vesting of
Restricted Stock
Units. The Board shall
establish the vesting schedule applicable to Restricted Stock Units and shall
specify the times, vesting and performance goal requirements. Until the end of
the period(s) of time specified in the vesting schedule and/or the satisfaction
of any performance criteria, the Restricted Stock Units subject to such
Incentive Award Agreement shall remain subject to forfeiture.

(c)      
Acceleration of
Award. The Board shall
have the power to permit, in its sole discretion, an acceleration of the
applicable restrictions or the applicable period of such restrictions with
respect to any part or all of the Restricted Stock Units awarded to a
Participant. 

(d)      
Necessity of
Incentive Award Agreement. Each grant of
Restricted Stock Unit(s) shall be evidenced by an Incentive Award Agreement that
shall specify the terms, conditions and restrictions regarding the Participant's
right to receive Share(s) in the future, and shall incorporate such other terms
and conditions as the Board, acting in its sole discretion, deems consistent
with the terms of this Plan. The Board shall have sole discretion to modify the
terms and provisions of Restricted Stock Unit(s) in accordance with Section 12
of this Plan.

(e)      
Transferability
of Restricted Stock Units. Except as
otherwise provided in a Participant's Restricted Stock Unit Award, no Restricted
Stock Unit granted under the Plan may be sold, transferred, pledged, assigned or
otherwise alienated or hypothecated by the holder Participant, except upon the
death of the holder Participant by will or by the laws of descent and
distribution. 

(f)      
Voting,
Dividend & Other Rights. Unless the
applicable Incentive Award Agreement provides otherwise, holders of Restricted
Stock Units shall not be entitled to vote or to receive dividends until they
become owners of the Shares pursuant to their Restricted Stock Units.

(g)      
Code §409A
Requirements. A Restricted Stock
Unit must meet certain restrictions contained in Code §409A if it is to avoid
taxation under Code §409A as a “nonqualified deferred compensation plan.” No
Restricted Stock Unit should be granted under this Plan without careful
consideration of the impact of Code §409A with respect to such grant upon both
the Company and the recipient of the Restricted Stock Unit.

7.6      
Terms
and Conditions of Restricted Unit Awards. 

(a)      
Grants of
Restricted Stock Units. Units awarded
pursuant to Restricted Unit Awards shall be subject to such restrictions as
determined by the Board for periods determined by the Board. 

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Restricted Unit
Awards issued under the Plan may have restrictions that lapse based upon the
service of a Participant, or based upon the attainment (as determined by the
Board) or performance goals established pursuant to the business criteria listed
in Section 14, or based upon any other criteria that the Board may determine
appropriate. Any Restricted Stock Unit which becomes exercisable based on the
attainment of performance goals must be granted by a Committee, must have its
performance goals determined by such a Committee based upon one or more of the
business criteria listed in Section 14, and must have the attainment of such
performance goals certified in writing by such a Committee in order to meet the
Performance-Based Exception. 

(b)      
Acceleration of
Award. The Board shall
have the power to permit, in its discretion, an acceleration of the expiration
of he applicable restrictions or the applicable period of such restrictions with
respect to any part or all of the Units awarded to a Participant.

(c)      
Necessity of
Incentive Award Agreement. Each grant of a
Restricted Unit Award shall be evidenced by an Incentive Award Agreement that
shall specify the terms, conditions and restrictions regarding the Units awarded
to a Participant, and shall incorporate such other terms and conditions as the
Board, acting in its absolute discretion, deems consistent with the terms of
this Plan. The Board shall have complete discretion to modify the terms and
provisions of Restricted Unit Awards in accordance with Section 12 of this
Plan.

(d)      
Restrictions on
Units Awarded. Units awarded
pursuant to Restricted Unit Awards shall be subject to such restrictions as
determined by the Board for periods determined by the Board. The Board may
impose such restrictions on any Units acquired pursuant to a Restricted Stock
Award as it may deem advisable, including, without limitation, vesting or
performance-based restrictions, rights of the Company to re-purchase Units
acquired pursuant to the Restricted Units Award, voting restrictions, investment
intent restrictions, restrictions on transfer, “first refusal” rights of the
Company to purchase Units acquired pursuant to the Restricted Unit Award prior
to their sale to any other person, “drag along” rights requiring the sale of
Units to a third party purchaser in certain circumstances, restrictions or
limitations or other provisions that would be applied to other holders of Units
under any applicable agreement among the holders of Units or under the limited
liability company agreement of the Initial Limited Partner, and restrictions
under applicable federal securities laws, and/or under any blue sky or state
securities laws applicable to such Units.

(e)      
Transferability
of Restricted Unit Awards. A Restricted Unit
Award may not be transferred by the holder Participant, except upon the death of
the holder Participant by will or by the laws of descent and
distribution.

(f)      
Other
Rights. The holders of
Restricted Unit Awards shall be entitled to only such rights as are afforded
such holders under the limited liability company agreement of the Initial
Limited Partner.

(g)      
Code §409A
Requirements. A Restricted Unit
Award must meet certain restrictions contained in Code §409A if it is to avoid
taxation under Code §409A as a “nonqualified deferred compensation plan.” No
Restricted Unit Award should be granted under this Plan without careful
consideration of the impact of Code §409A with respect to such grant upon both
the Company and the recipient of the Restricted Unit Award.

Section
8.

Securities
Regulation

Each Incentive
Award Agreement may provide that, upon the receipt of Shares or Units as a
result of the exercise of an Incentive Award or otherwise, the Participant
shall, if so requested by the Company, hold such Shares or Units for investment
and not with a view of resale or distribution to the public and, if so requested
by the Company, shall deliver to the Company and/or the Initial Limited Partner
a written statement satisfactory to the Company to that effect. Each Incentive
Award Agreement may also provide that, if so requested by the Company, the
Participant shall make a written representation to the Company and/or the
Initial Limited Partner that he or she will not sell or offer to sell any of
such Shares or Units unless a registration statement shall be in effect with
respect to such Shares or Units under the Securities Act of 1933, as amended
("1933 Act"), and any applicable state securities law or, unless he or she shall
have furnished to the Company

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an opinion, in form
and substance satisfactory to the Company, of legal counsel acceptable to the
Company, that such registration is not required. Certificates representing the
Shares or Units transferred upon the exercise of an Incentive Award granted
under this Plan may at the discretion of the Company bear a legend to the effect
that such Shares or Units have not been registered under the 1933 Act or any
applicable state securities law and that such Shares or Units may not be sold or
offered for sale in the absence of an effective registration statement as to
such Shares or Units under the 1933 Act and any applicable state securities law
or an opinion, in form and substance satisfactory to the Company, of legal
counsel acceptable to the Company, that such registration is not
required.

Section
9.

Life of
Plan

No Incentive Award
shall be granted under this Plan on or after the earlier of: 

(a)      
the
tenth (10th) anniversary of the effective date of this Plan (as determined under
Section 4 of this Plan), in which event this Plan otherwise thereafter shall
continue in effect until all outstanding Incentive Awards have been exercised in
full or no longer are exercisable, or

(b)      
the
date on which all of the Shares reserved under Section 3 of this Plan have (as a
result of the exercise of Incentive Awards granted under this Plan or lapse of
all restrictions under a Restricted Stock Award or Restricted Unit Award or
Restricted Stock Unit) been issued or no longer are available for use under this
Plan, in which event this Plan also shall terminate on such date.

This Plan shall
continue in effect until all outstanding Incentive Awards have been exercised in
full or are no longer exercisable and all Restricted Stock Awards or Restricted
Stock Units or Restricted Unit Awards have vested or been
forfeited.

Section
10.

Adjustment

Notwithstanding
anything in Section 12 to the contrary, the number of Shares reserved under
Section 3 of this Plan, the limit on the number of Shares that may be granted
during a calendar year to any individual under Section 3 of this Plan, the
number of Shares or Units subject to Incentive Awards granted under this Plan,
and the Exercise Price of any Options and the SAR Exercise Price of any Stock
Appreciation Rights, shall be adjusted by the Board in an equitable manner to
reflect any change in the capitalization of the Company or the Initial Limited
Partner, including, but not limited to, such changes as stock dividends or stock
splits. Furthermore, the Board shall have the right to adjust (in a manner that
satisfies the requirements of Code §424(a)) the number of Shares reserved under
Section 3, and the number of Shares or Units subject to Incentive Awards granted
under this Plan, and the Exercise Price of any Options and the SAR Exercise
Price of any Stock Appreciation Rights in the event of any corporate transaction
described in Code §424(a) that provides for the substitution or assumption of
such Incentive Awards. If any adjustment under this Section creates a fractional
Share or a right to acquire a fractional Share or Unit, such fractional Share or
Unit shall be disregarded, and the number of Shares or Units reserved under this
Plan and the number subject to any Incentive Awards granted under this Plan
shall be the next lower number of Shares or Units, rounding all fractions
downward. An adjustment made under this Section by the Board shall be conclusive
and binding on all affected persons and, further, shall not constitute an
increase in the number of Shares reserved under Section 3.

Section
11.

Change of
Control of the Company

11.1      
General Rule
for Options. Except as
otherwise provided in an Incentive Award Agreement, if a Change of Control
occurs, and if the agreements effectuating the Change of Control do not provide
for the assumption or substitution of all Options granted under this Plan, with
respect to any Option granted under this

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Plan that is not so
assumed or substituted (a “Non-Assumed Option”), the Committee, in its sole and
absolute discretion, may, with respect to any or all of such Non-Assumed
Options, take any or all of the following actions to be effective as of the date
of the Change of Control (or as of any other date fixed by the Committee
occurring within the thirty (30) day period ending on the date of the Change of
Control, but only if such action remains contingent upon the effectuation of the
Change of Control) (such date referred to as the “Action Effective
Date”):

(a)      
Accelerate the
vesting and/or exercisability of such Non-Assumed Option; and/or 

(b)      
Unilaterally cancel
any such Non-Assumed Option which has not vested and/or which has not become
exercisable as of the Action Effective Date; and/or

(c)      
Unilaterally cancel
such Non-Assumed Option in exchange for:

(i)      
whole
and/or fractional Shares (or for whole Shares and cash in lieu of any fractional
Share) that, in the aggregate, are equal in value to the excess of the Fair
Market Value of the Shares that could be purchased subject to such Non-Assumed
Option determined as of the Action Effective Date (taking into account vesting
and/or exercisability) over the aggregate Exercise Price for such Shares;
or

(ii)      
cash
or other property equal in value to the excess of the Fair Market Value of the
Shares that could be purchased subject to such Non-Assumed Option determined as
of the Action Effective Date (taking into account vesting and/or exercisability)
over the aggregate Exercise Price for such Shares; and/or 

(d)      
Unilaterally cancel
such Non-Assumed Option after providing the holder of such Option with (1) an
opportunity to exercise such Non-Assumed Option to the extent vested and/or
exercisable within a specified period prior to the date of the Change of
Control, and (2) notice of such opportunity to exercise prior to the
commencement of such specified period; and/or

(e)      
Unilaterally cancel
such Non-Assumed Option and notify the holder of such Option of such action, but
only if the Fair Market Value of the Shares that could be purchased subject to
such Non-Assumed Option determined as of the Action Effective Date (taking into
account vesting and/or exercisability) does not exceed the aggregate Exercise
Price for such Shares.

However,
notwithstanding the foregoing, to the extent that the recipient of a Non-Assumed
Option is an Insider, payment of cash in lieu of whole or fractional Shares or
shares of a successor may only be made to the extent that such payment (1) has
met the requirements of an exemption under Rule 16b-3 promulgated under the
Exchange Act, or (2) is a subsequent transaction the terms of which were
provided for in a transaction initially meeting the requirements of an exemption
under Rule 16b-3 promulgated under the Exchange Act. Unless an Incentive Award
Agreement provides otherwise, the payment of cash in lieu of whole or fractional
Shares or in lieu of whole or fractional shares of a successor shall be
considered a subsequent transaction approved by the original grant of an
Option.

11.2      
General Rule
for SARs. Except as
otherwise provided in an Incentive Award Agreement, if a Change of Control
occurs, and if the agreements effectuating the Change of Control do not provide
for the assumption or substitution of all Stock Appreciation Rights granted
under this Plan, with respect to any Stock Appreciation Right granted under this
Plan that is not so assumed or substituted (a “Non-Assumed SAR”), the Committee,
in its sole and absolute discretion, may, with respect to any or all of such
Non-Assumed SARs, take either or both of the following actions to be effective
as of the date of the Change of Control (or as of any other date fixed by the
Committee occurring within the thirty (30) day period ending on the date of the
Change of Control, but only if such action remains contingent upon the
effectuation of the Change of Control) (such date referred to as the “Action
Effective Date”):

(a)      
Accelerate the
vesting and/or exercisability of such Non-Assumed SAR; and/or 

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15

(b)      
Unilaterally cancel
any such Non-Assumed SAR which has not vested or which has not become
exercisable as of the Action Effective Date; and/or

(c)      
Unilaterally cancel
such Non-Assumed SAR in exchange for:

(i)      
whole
and/or fractional Shares (or for whole Shares and cash in lieu of any fractional
Share) that, in the aggregate, are equal in value to the excess of the Fair
Market Value of the Shares subject to such Non-Assumed SAR determined as of the
Action Effective Date (taking into account vesting and/or exercisability) over
the SAR Exercise Price for such Non-Assumed SAR; or

(ii)      
cash
or other property equal in value to the excess of the Fair Market Value of the
Shares subject to such Non-Assumed SAR determined as of the Action Effective
Date (taking into account vesting and/or exercisability) over the SAR Exercise
Price for such Non-Assumed SAR; and/or

(d)      
Unilaterally cancel
such Non-Assumed SAR after providing the holder of such SAR with (1) an
opportunity to exercise such Non-Assumed SAR to the extent vested and/or
exercisable within a specified period prior to the date of the Change of
Control, and (2) notice of such opportunity to exercise prior to the
commencement of such specified period; and/or

(e)      
Unilaterally cancel
such Non-Assumed SAR and notify the holder of such SAR of such action, but only
if the Fair Market Value of the Shares that could be purchased subject to such
Non-Assumed SAR determined as of the Action Effective Date (taking into account
vesting and/or exercisability) does not exceed the SAR Exercise Price for such
Non-Assumed SAR.

However,
notwithstanding the foregoing, to the extent that the recipient of a Non-Assumed
SAR is an Insider, payment of cash in lieu of whole or fractional Shares or
shares of a successor may only be made to the extent that such payment (1) has
met the requirements of an exemption under Rule 16b-3 promulgated under the
Exchange Act, or (2) is a subsequent transaction the terms of which were
provided for in a transaction initially meeting the requirements of an exemption
under Rule 16b-3 promulgated under the Exchange Act. Unless an Incentive Award
Agreement provides otherwise, the payment of cash in lieu of whole or fractional
Shares or in lieu of whole or fractional shares of a successor shall be
considered a subsequent transaction approved by the original grant of a
SAR.

11.3      
General Rule
for Restricted Stock Units. Except as
otherwise provided in an Incentive Award Agreement, if a Change of Control
occurs, and if the agreements effectuating the Change of Control do not provide
for the assumption or substitution of all Restricted Stock Units granted under
this Plan, with respect to any Restricted Stock Unit granted under this Plan
that is not so assumed or substituted (a “Non-Assumed RSU”), the Committee, in
its sole and absolute discretion, may, with respect to any or all of such
Non-Assumed RSUs, take either or both of the following actions to be effective
as of the date of the Change of Control (or as of any other date fixed by the
Committee occurring within the thirty (30) day period ending on the date of the
Change of Control, but only if such action remains contingent upon the
effectuation of the Change of Control) (such date referred to as the “Action
Effective Date”):

(a)      
Accelerate the
vesting of such Non-Assumed RSU; and/or 

(b)      
Unilaterally cancel
any such Non-Assumed RSU which has not vested as of the Action Effective Date;
and/or

(c)      
Unilaterally cancel
such Non-Assumed RSU in exchange for:

(i)      
whole
and/or fractional Shares (or for whole Shares and cash in lieu of any fractional
Share) that are equal to the number of Shares subject to such Non-Assumed RSU
determined as of the Action Effective Date (taking into account vesting);
or

(ii)      
cash
or other property equal in value to the Fair Market Value of the Shares subject
to such Non-Assumed RSU determined as of the Action Effective Date (taking into
account vesting); and/or

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16

(d)      
Unilaterally cancel
such Non-Assumed RSU and notify the holder of such RSU of such action, but only
if the Fair Market Value of the Shares that were subject to such Non-Assumed RSU
determined as of the Action Effective Date (taking into account vesting) is
zero.

However,
notwithstanding the foregoing, to the extent that the recipient of a Non-Assumed
RSU is an Insider, payment of cash in lieu of whole or fractional Shares or
shares of a successor may only be made to the extent that such payment (1) has
met the requirements of an exemption under Rule 16b-3 promulgated under the
Exchange Act, or (2) is a subsequent transaction the terms of which were
provided for in a transaction initially meeting the requirements of an exemption
under Rule 16b-3 promulgated under the Exchange Act. Unless an Incentive Award
Agreement provides otherwise, the payment of cash in lieu of whole or fractional
Shares or in lieu of whole or fractional shares of a successor shall be
considered a subsequent transaction approved by the original grant of an
RSU.

11.4      
General Rule
for Other Incentive Award Agreements. If a Change of
Control occurs, then, except to the extent otherwise provided in the Incentive
Award Agreement pertaining to a particular Incentive Award or as otherwise
provided in this Plan, each Incentive Award shall be governed by applicable law
and the documents effectuating the Change of Control. 

Section
12.

Amendment
or Termination

This Plan may be
amended by the Board from time to time to the extent that the Board deems
necessary or appropriate; provided, however, no such amendment shall be made
absent the approval of the stockholders of the Company (a) to increase the
number of Shares reserved under Section 3, except as set forth in Section 10,
(b) to extend the maximum life of the Plan under Section 9 or the maximum
exercise period under Section 7, (c) to decrease the minimum Exercise Price
under Section 7, or (d) to change the designation of Eligible Recipients
eligible for Incentive Awards under Section 6. Stockholder approval of other
material amendments (such as an expansion of the types of awards available under
the Plan, an extension of the term of the Plan, a change to the method of
determining the Exercise Price of Options issued under the Plan, or a change to
the provisions of Section 7.2(j)) may also be required pursuant to rules
promulgated by an established stock exchange or a national market system if the
Company is, or become, listed or traded on any such established stock exchange
or national market system, or for the Plan to continue to be able to issue
Incentive Awards which meet the Performance-Based Exception. The Board also may
suspend the granting of Incentive Awards under this Plan at any time and may
terminate this Plan at any time. The Company shall have the right to modify,
amend or cancel any Incentive Award after it has been granted if (I) the
modification, amendment or cancellation does not diminish the rights or benefits
of the Incentive Award recipient under the Incentive Award (provided, however,
that a modification, amendment or cancellation that results solely in a change
in the tax consequences with respect to an Incentive Award shall not be deemed
as a diminishment of rights or benefits of such Incentive Award), (II) the
Participant consents in writing to such modification, amendment or cancellation,
(III) there is a dissolution or liquidation of the Company, (IV) this Plan
and/or the Incentive Award Agreement expressly provides for such modification,
amendment or cancellation, or (V) the Company would otherwise have the right to
make such modification, amendment or cancellation by applicable law.

Section
13.

Miscellaneous

13.1      
Stockholder
or Unit-holder Rights. No Participant
shall have any rights as a stockholder of the Company or a Unit holder of the
Initial Limited Partner as a result of the grant of an Incentive Award to him or
to her under this Plan or his or her exercise of such Incentive Award pending
the actual delivery of Shares or Units subject to such Incentive Award to such
Participant.

13.2      
No
Guarantee of Continued Relationship. The grant of an
Incentive Award to a Participant under this Plan shall not constitute a contract
of employment and shall not confer on a Participant any rights

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

Page
17

upon his or her
termination of employment or relationship with the Company in addition to those
rights, if any, expressly set forth in the Incentive Award Agreement that
evidences his or her Incentive Award.

13.3      
Withholding. The Company shall
have the power and the right to deduct or withhold, or require a Participant to
remit to the Company as a condition precedent for the fulfillment of any
Incentive Award, an amount sufficient to satisfy Federal, state and local taxes,
domestic or foreign, required by law or regulation to be withheld with respect
to any taxable event arising as a result of this Plan and/or any action taken by
a Participant with respect to an Incentive Award. Whenever Shares are to be
issued to a Participant upon exercise of an Option or a Stock Appreciation
Right, or satisfaction of conditions under a Restricted Stock Unit, or grant of
or substantial vesting of a Restricted Stock Award, the Company shall have the
right to require the Participant to remit to the Company, as a condition of
exercise of the Option or Stock Appreciation Right, or as a condition to the
fulfillment of the Restricted Stock Unit, or as a condition to the grant or
substantial vesting of the Restricted Stock Award, an amount in cash (or, unless
the Incentive Award Agreement provides otherwise, in Shares) sufficient to
satisfy federal, state and local withholding tax requirements at the time of
such exercise, satisfaction of conditions, or grant or substantial vesting.
However, notwithstanding the foregoing, to the extent that a Participant is an
Insider, satisfaction of withholding requirements by having the Company withhold
Shares may only be made to the extent that such withholding of Shares (1) has
met the requirements of an exemption under Rule 16b-3 promulgated under the
Exchange Act, or (2) is a subsequent transaction the terms of which were
provided for in a transaction initially meeting the requirements of an exemption
under Rule 16b-3 promulgated under the Exchange Act. Unless the
Incentive Award Agreement provides otherwise, the withholding of shares to
satisfy federal, state and local withholding tax requirements shall be a
subsequent transaction approved by the original grant of an Incentive Award.
Notwithstanding the
foregoing, in no event shall payment of withholding taxes be made by a retention
of Shares by the Company unless the Company retains only Shares with a Fair
Market Value equal to the minimum amount of taxes required to be
withheld.

13.4      
Notification
of Disqualifying Dispositions of ISO Options. If a Participant
sells or otherwise disposes of any of the Shares acquired pursuant to an Option
that is an ISO on or before the later of (1) the date two (2) years after the
date of grant of such Option, or (2) the date one (1) year after the exercise of
such Option, then the Participant shall immediately notify the Company in
writing of such sale or disposition and shall cooperate with the Company in
providing sufficient information to the Company for the Company to properly
report such sale or disposition to the Internal Revenue Service. The Participant
acknowledges and agrees that he may be subject to federal, state and/or local
tax withholding by the Company on the compensation income recognized by
Participant from any such early disposition, and agrees that he shall include
the compensation from such early disposition in his gross income for federal tax
purposes. Participant also acknowledges that the Company may condition the
exercise of any Option that is an ISO on the Participant’s express written
agreement with these provisions of this Plan.

13.5      
Transfer. The transfer of an
Employee between or among the Company, a Subsidiary or a Parent shall not be
treated as a termination of his or her employment under this Plan. The transfer
of an Employee between or among the Company and the Initial Limited Partner
shall also not be treated as a termination of his or her employment under this
Plan. However, notwithstanding the foregoing, a termination of employment may
nonetheless occur for purposes of determining whether an Option will satisfy the
requirements of the Code to be an ISO.

13.6      
Construction. This Plan shall be
construed under the laws of the State of Maryland.

Section
14.

Performance
Criteria

14.1      
Performance
Goal Business Criteria. Unless and until
the Board proposes for stockholder vote and stockholders approve a change in the
general performance measures set forth in this Section, the attainment of which
may determine the degree of payout and/or vesting with respect to Incentive
Awards to Employees and Key Persons pursuant to this Plan which are designed to
qualify for the Performance-Based Exception, the performance measure(s) to be
used by a Committee composed of two (2) or more Outside Directors for purposes
of such grants shall be chosen from among the following:

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

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18

		(a)	
      Earnings per
      share;

		(b)	
      Net income
      (before or after taxes);

		(c)	
      Return
      measures (including, but not limited to, return on assets, equity or
      sales);

		(d)	
      Cash flow
      return on investments which equals net cash flows divided by owners
      equity;

		(e)	
      Earnings
      before or after taxes, depreciation and/or
amortization;

		(f)	
      Gross
      revenues;

		(g)	
      Operating
      income (before or after taxes);

		(h)	
      Total
      stockholder returns;

		(i)	
      Corporate
      performance indicators (indices based on the level of certain services
      provided to customers);

		(j)	
      Cash
      generation, profit and/or revenue targets;

		(k)	
      Growth
      measures, including revenue growth, as compared with a peer group or other
      benchmark;

		(l)	
      Share price
      (including, but not limited to, growth measures and total stockholder
      return); and/or

		(m)	
      Pre-tax
      profits.

14.2      
Discretion
in Formulation of Performance Goals. The Board shall
have the discretion to adjust the determinations of the degree of attainment of
the pre-established performance goals; provided, however, that Incentive Awards
that are to qualify for the Performance-Based Exception may not be adjusted
upward (although the Committee shall retain the discretion to adjust such
Incentive Awards downward).

14.3      
Performance
Periods. The Board shall
have the discretion to determine the period during which any performance goal
must be attained with respect to an Incentive Award. Such period may be of any
length, and must be established prior to the start of such period or within the
first ninety (90) days of such period (provided that the performance criteria is
not in any event set after 25% or more of such period has elapsed).

14.4      
Modifications
to Performance Goal Business Criteria. In the event that
the applicable tax and/or securities laws change to permit Board discretion to
alter the governing performance measures noted above without obtaining
stockholder approval of such changes, the Board shall have sole discretion to
make such changes without obtaining stockholder approval. In addition, in the
event that the Board determines that it is advisable to grant Incentive Awards
that shall not qualify for the Performance-Based Exception, the Board may make
such grants without satisfying the requirements of Code §162(m); otherwise, a
Committee composed exclusively of two (2) of more Outside Directors must make
such grants.

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Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

Page
19

APPENDIX
A

1.      
Option
Grant Upon Appointment as Outside Director:  As of the date on
which an individual becomes an Outside Director (the “Appointment Grant Date”),
such individual shall automatically, without any further action necessary on the
part of the Board or any committee thereof, be granted an Option effective as of
the Appointment Grant Date to purchase a number of shares equal to five thousand
(5,000) shares of common stock of the Company multiplied the number of full
calendar months from the Appointment Grant Date until the following June 1 and
divided by 12, provided that such individual is not an employee of the Company
as of such date.

2.      
Option
Grant Upon Election as Outside Director:  Subject to
paragraph 3 below, as of the date on which an individual is elected or
re-elected by the stockholders of the Company to serve as an Outside Director
and becomes or continues as an Outside Director, such individual shall
automatically, without any further action necessary on the part of the Board or
any committee thereof, be granted an Option to purchase five thousand (5,000)
shares of common stock of the Company effective as of such date, provided that
such individual is not an employee of the Company as of such date. 

3.      
Exercise
Price for Options:  The exercise price
for each option automatically granted under the foregoing provisions shall be at
or above the fair market value of the underlying shares of common stock on the
date of grant. Until such time as the earlier of (a) the Company begins having
appraisals by an independent third party, (b) the Company has filed a
registration statement for a firm commitment, underwritten public offering of
its shares of common stock or (c) the shares of common stock are listed on a
national stock exchange or national market system (the “New Valuation Date”),
the Company has determined that an exercise price that equals or exceeds the
price per share at which the Company is then offering or last offered shares of
its common stock in a best efforts, registered public offering, less related
selling commissions, dealer manager fees and maximum organization and offering
expense reimbursement allowance shall be at or above the fair market value of an
underlying share of common stock. The Company is currently offering shares of
common stock in a registered public offering at an offering price of $10.00 per
share, with selling commissions, a dealer manager fee and maximum offering
expense reimbursement allowance of $0.70, $0.20 and $0.20 per share,
respectively. Therefore, any exercise per share in excess of $8.90 shall be at
or above the fair market value of an underlying share of common stock until the
New Valuation Date. Until changed by the Board, before the New Valuation Date,
the Options to be granted pursuant to this Appendix A shall be granted with an
exercise price of $9.10 per share. After New Valuation Date, the fair market
value shall be, as applicable, (i) 100% of the net asset value per share, as
determined by the appraisals, (ii) the maximum offering price under the
registration statement for a firm commitment, underwritten public offering of
its shares of common stock or (iii) the fair market value for such shares as
determined in accordance with section 2.15 of the Plan and the exercise price of
Options granted under this Appendix A shall be such fair market
value.

4.      
Vesting: Options granted
automatically under the foregoing provisions shall vest and become fully
exercisable on the first anniversary of the date of grant. Except as provided by
the Board or the Committee at the time of grant or thereafter, in the event an
Outside Director’s service to the Company terminates before the Options have
vested, any Option granted to such Outside Director that has not vested shall be
cancelled and the Outside Director shall have no further right or interest in
such forfeited Option. 

5.      
Term of
Options: Each Option
granted automatically under the foregoing provisions shall remain outstanding
until the tenth anniversary of the date of grant. Except as provided by the
Board or the Committee at the time of grant or thereafter, in the event an
Outside Director’s service to the Company terminates for any reason, any vested
Option then held by such Outside Director shall be cancelled upon the first to
occur of (i) the first anniversary of the date that shares of the Common Stock
are first listed on a national stock exchange or a national market system, and
(ii) the tenth anniversary of the date of grant.

 

 

Behringer
Harvard Opportunity REIT I, Inc. 2004 Incentive Award Plan

 

Page
20Purchase Agreement

 Exhibit 10.1 
  
 Execution Copy 
  
 PURCHASE AGREEMENT 
  
 THIS PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of May 23, 2005, by and among PalmSource, Inc., a Delaware
corporation (“Seller”), Palm Trademark Holding Company, LLC, a Delaware limited liability company (the “Company”), and palmOne, Inc., a Delaware corporation (“Purchaser”). For purposes of this
Agreement, all capitalized terms used herein without definition have the respective meanings set forth in Article X. 
  
 RECITALS 
  
 WHEREAS, Seller and Purchaser have previously assigned all of their respective right, title and interest in and to the Palm Marks and the PalmOne Brand to the Company; 
  
 WHEREAS, the Parties are party to the Operating Agreement, which sets forth the terms of governance and operation of the
Company; 
  
 WHEREAS, the Parties desire that Seller sell,
transfer and deliver to Purchaser, and Purchaser acquire from Seller, all of Seller’s Membership Interests in the Company upon the terms and subject to the conditions set forth in this Agreement and in accordance with the terms of the Operating
Agreement; and 
  
 WHEREAS, Seller and the Company are currently
party to the License Agreement, and the Parties desire to amend and restate the License Agreement concurrently with the Closing, such that, except as provided in the Amended License Agreement, all of Seller’s right, title and interest in and to
the Palm Marks and the PalmOne Brand will inure to the Company. The Parties intend Purchaser and its Subsidiaries will wholly own the Company as of the Closing. 
  

NOW, THEREFORE, in consideration of the premises, the terms and conditions set forth herein, the mutual benefits to be gained by the performance
thereof and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows: 
  
 ARTICLE I 
 PURCHASE AND SALE OF
MEMBERSHIP INTERESTS 
  
 1.1 Purchase Transaction. Upon
the terms and subject to the conditions of this Agreement, at the Closing, Seller shall sell, transfer and deliver to Purchaser, and Purchaser shall acquire from Seller, all right, title and interest in and to the Seller Membership Interests in
exchange for the amounts set forth in Schedule 1.2 (the “Total Consideration”). 
  
 1.2 Purchase Price. Purchaser shall deliver to Seller the Total Consideration, to be paid in immediately available funds in accordance with
Schedule 1.2, subject in all cases to set-off for payments under the indemnification provisions set forth in Article VIII, which Seller acknowledges in writing are then due and payable by Seller, in consideration of (a) the sale, 

 transfer and delivery of all right, title and interest in and to the Seller Membership Interests to Purchaser and (b) the
execution of the Amended License Agreement by Seller and the Company and delivery thereof to Purchaser. If the date on which a payment is required to be made under Schedule 1.2 is not a Business Day, such payment shall be due on the next
succeeding Business Day. 
  
 1.3 Closing. The closing (the
“Closing”) of the transactions to be consummated in accordance with the terms of this Agreement shall take place at the offices of DLA Piper Rudnick Gray Cary in East Palo Alto at 12:01 a.m. on (a) the day that immediately follows
the date of satisfaction or waiver of the conditions set forth in Article V or (b) such other date as mutually agreed to by the Parties. The date on which the Closing occurs in accordance with this Section 1.3 is hereinafter referred to as the
“Closing Date.” 
  
 1.4 Deliveries.

  
 (a) At the Closing, Seller shall deliver, or cause to be
delivered, to Purchaser, each of the following: 
  
 (i) a
membership interest power in respect of the Seller Membership Interests, duly executed in the name of Purchaser; 
  
 (ii) the Amended License Agreement, duly executed by Seller; and 
  

(iii) evidence of satisfaction of all conditions set forth in Section 5.1, including the certificate referred to in Section 5.1(a), the resignations
referred to in Section 5.1(d), and the certificate referred to in Section 5.1(e). 
  
 (b) At the Closing, Purchaser shall deliver, or cause to be delivered, to Seller, each of the following: 
  
 (i) the first installment of the Total Consideration as shown in Schedule 1.2; and 
  
 (ii) evidence of satisfaction of all conditions set forth in Section 5.2, including the certificate referred to in Section
5.2(a). 
  
 (c) At the Closing, the Company shall deliver, or
cause to be delivered, to Seller, the Amended License Agreement, duly executed by the Company. 
  
 1.5 Palm.com Site. 
  
 (a)
Throughout the period from the Closing Date until the date that Purchaser launches the Palm.com Site as its primary company home page (the “palmOne Home Page Launch”), the Palm.com Site shall remain a split site with the content,
size, placement and format exactly as it is on the Closing Date. Seller acknowledges and agrees that Purchaser may launch the Palm.com site as its primary company home page at any time in its sole discretion; provided, however, that Purchaser
shall provide written notice to Seller of such launch at least 
  

 -2- 

 five (5) Business Days prior to such launch. Seller agrees that e-mail notice to both Seller’s Senior Vice President
of Worldwide Marketing and Vice President of Brand Marketing shall satisfy the foregoing notice obligation. 
  
 (b) Throughout the Home Page Period (as defined below), the Seller Palm.com Site Content shall appear on the home page of the Palm.com Site, at or above
the fold based on 1024 x 768 browser resolution (the “Home Page Banner”). The “Home Page Period” shall mean the period from the date of the palmOne Home Page Launch until the date that is twelve (12) months after
the Closing Date, provided that if Seller publicly announces its new corporate identity during such period, then such twelve (12) month period shall be extended to a date three (3) months after such announcement, in any event not to exceed fifteen
(15) months after the Closing Date. The Home Page Banner shall be no less than 160w by 75h height in size based on 1024 x 768 browser resolution. From the first day following the end of the Home Page Period through and including the second
anniversary of the Closing (the “Products Page Period” and together with the Home Page Period, the “Presence Period”), the Seller Palm.com Site Content shall appear on the “Products” page (or any successor
thereto) of the Palm.com Site (the “Products Page Banner”). The Products Page Banner shall be a banner no less than 125w by 90h height in size based on 1024 x 768 browser resolution. The content and format of the Home Page Banner
and the Products Page Banner shall each be created by Seller and subject to Purchaser’s approval, which shall not be unreasonably withheld or delayed. Except as otherwise provided herein, the exact size and placement of the Home Page Banner and
the Products Page Banner shall be determined by Purchaser in its sole discretion. The Home Page Banner shall be a graphical link to the homepage of Seller’s primary website. For the first three (3) months of the Products Page Period, the
Products Page Banner shall provide a link to a page within Seller’s website that clearly explains the difference between Seller (and its new corporate identity) and Purchaser (the “Clarifications Page”), and provides links to
other webpages in the Seller’s primary website and to the Palm.com Site home page. The content of the Clarifications Page will be designed by Seller and approved by Purchaser, such approval not to be unreasonably withheld or delayed; after such
three (3) month period, the Products Page Banner shall provide a link to a webpage within Seller’s website as determined by Seller in its sole discretion. After the Seller Palm.com Site Content has been posted, Purchaser shall have no right to
make any changes to the Seller Palm.com Site Content (i.e., content and format) other than at Seller’s request. Any changes to the Seller Palm.com Site Content (i.e., content and format) requested by Seller shall be subject to the approval of
Purchaser in its sole discretion, except that Purchaser’s approval shall not be required for substituting the Seller’s new company name, logo, trade dress or operating system product name when the Seller Split Site Content converts from
the Home Page Banner to the Products Page Banner. Purchaser will manage, maintain and pay expenses in connection with the Palm.com Site; provided, however, that any requested changes to the Seller Palm.com Site Content shall be at
Seller’s sole expense. During the Presence Period, Purchaser acknowledges and agrees that no content on the Palm.com Site other than the Seller Palm.com Site Content shall in any manner disparage Seller or any of its Affiliates or any of its or
their products or services; and Seller acknowledges and agrees that it shall have no other right to approve content on the Palm.com Site other than the Seller Palm.com Site Content. 
  
 (c) From and after the end of the Presence Period, Seller shall have no right to have its content posted on the Palm.com
Site. Seller acknowledges and agrees that, except as set 
  

 -3- 

 forth in Section 1.5(a) and as provided in the Amended License Agreement, as of the Closing Date it shall have no
existing right, title or interest in or to the Palm.com Site, or any domain names incorporating the element PALM, and that all right, title and interest in and to the Palm.com Site, and any domain names incorporating the element PALM, belong
exclusively to the Company. For the avoidance of doubt, as between Seller and Purchaser, any residual rights in and to the Palm.com Site shall belong to Purchaser and, as between Seller and Company, any residual rights in and to any domain names
incorporating the element PALM shall belong solely to Company, except as set forth in the Amended License Agreement. 
  
 (d) Each Party hereby releases and discharges each other Party and such Party’s Subsidiaries, Affiliates, successors, shareholders and
Representatives, from any all claims, demands, damages, debts, obligations, costs, actions, and causes of action of every kind and nature whatsoever whether now known or unknown, which such Party or its Affiliates has, owns or holds against another
Party or another Party’s released parties in connection with the rights and obligations pursuant to the License Agreement, the PalmOne License, the Operating Agreement and the Brand Manager Charter. This release is intended to cover all claims
or possible claims by each Party against another Party and the other released parties in connection with each Party’s rights and obligations pursuant to such agreements whether the same is known, unknown, or hereafter discovered and
ascertained. Each Party acknowledges that it is familiar with the provisions of Section 1542 of the California Civil Code, which provides as follows: 
  
 A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN
BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. 
  
 Each Party expressly, knowingly and intentionally waives and relinquishes any and all rights which it has under the provisions of Section 1542, and waives the provisions of Section 1542, as well as any other similar
statute or common law principle. 
  
 1.6 Cooperation; Further
Assurances; Future Expenses Related to Assignments. Each of Purchaser and Seller shall, and shall cause its respective Affiliates and Representatives to (as applicable), after the Closing, effect the orderly transition of the Seller Membership
Interests to Purchaser. After the Closing, upon reasonable written notice, Purchaser and Seller agree that they shall furnish or cause to be furnished to each other and their respective Affiliates and Representatives, as applicable, access during
normal business hours and upon reasonable advance notice to such information and assistance relating to the Company as is necessary to effect the transactions contemplated by this Agreement. Seller shall also cooperate as reasonably necessary with
Purchaser and the Company in the procurement and maintenance of the Company’s intellectual property rights in the Palm Marks and the PalmOne Brand, including (a) cooperating with Purchaser and the Company in recording and perfecting the
Company’s rights in and to the Palm Marks and the PalmOne Brand, (b) transferring all trademark files of the Company in Seller’s possession and instructing the Company’s counsel to transfer all such files at the request of Purchaser
to Purchaser or its designee, and (c) providing reasonable assistance in connection with disputes directly involving the Company or Purchaser with respect to the Palm Marks and the PalmOne Brand and prosecution by the Company of new trademarks

  

 -4- 

 incorporating the Palm Marks or the PalmOne Brand or elements thereof incorporating the four-letter string
“PALM” (the out-of-pocket expenses incurred by Seller in the performance of the obligations in clause (c) shall be referred to as the “Dispute Expenses”). Each Party shall, and shall cause its respective Affiliates and
Representatives, as applicable, to execute and deliver such further certificates, agreements and other documents and perform all acts necessary to consummate the transactions contemplated by this Agreement, including the transfer of all Seller
Membership Interests to Purchaser at the Closing. Following the Closing, Seller shall take all actions reasonably necessary and within its power to transfer all right, title and interest (including technical and administrative control) in and to the
Seller-Controlled Palm Domain Names to the Company, including notifying all domain name registrars and third parties providing services in connection with the Seller-Controlled Palm Domain Names of such transfer of the Seller-Controlled Palm Domain
Names to the Company. If (i) within ninety (90) days after the Closing Date, Seller has failed to transfer ownership and control of any domestic Seller-Controlled Palm Domain Names to the Company, or (ii) within one hundred twenty (120) days after
the Closing Date, Seller has failed to transfer ownership and control of any international Seller-Controlled Palm Domain Names to the Company, Seller shall promptly (and in no event later than five (5) Business Days after the end of such ninety (90)
day or one hundred twenty (120) day period as applicable) deliver to Purchaser a power of attorney in favor of the Company with respect to the transfer of ownership and control of any such Seller-Controlled Palm Domain Names. Seller and Purchaser
shall each pay fifty percent (50%) of the aggregate out-of-pocket expenses incurred by the Parties under this Section 1.6, other than (A) the Dispute Expenses, which shall be paid by Purchaser, and (B) transfer taxes which shall be paid pursuant to
Section 4.2(e), up to an aggregate amount of Three Hundred and Seventy Five Thousand U.S. Dollars (U.S. $375,000); all such expenses in excess of Three Hundred and Seventy Five Thousand U.S. Dollars (U.S. $375,000) shall be paid by the Company
and/or Purchaser. For the avoidance of doubt, in no event shall Seller be responsible for paying more than One Hundred Eighty-Seven Thousand Five Hundred U.S. Dollars (U.S. $187,500) in accordance with the foregoing sentence. 
  
 ARTICLE II 
 REPRESENTATIONS AND WARRANTIES OF SELLER 
  
 As of the date hereof, Seller represents and warrants to Purchaser as follows: 
  
 2.1 Organization and Authority. Seller is duly incorporated, validly existing and in good standing under the laws of
the State of Delaware. Seller has all necessary corporate power and authority to execute, deliver and perform this Agreement and the Amended License Agreement and to consummate the transactions contemplated hereby and thereby. The execution,
delivery and performance by Seller of this Agreement and the Amended License Agreement and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of Seller. This
Agreement and the Amended License Agreement have been duly executed and delivered by Seller and, assuming due execution and delivery by the Company and, with respect to this Agreement only, Purchaser, this Agreement and the Amended License Agreement
constitute the legal, valid and binding obligation of Seller, enforceable against Seller in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws and equitable principles relating to or limiting creditors rights generally. 
  

 -5- 

 Seller, in its capacity as a member of the Company, has approved this Agreement and the Amended License Agreement and the
transactions contemplated hereby and thereby. Seller’s Board of Directors has approved this Agreement and the transactions contemplated hereby. 
  
 2.2 Noncontravention. The execution, delivery and performance by Seller of this Agreement and the Amended License Agreement and the consummation of
the transactions contemplated hereby and thereby will not (a) conflict with, or result in any violation or breach of, any provision of the Charter or Bylaws of Seller, (b) conflict with, result in any violation or breach of, constitute a default
under, result in a forfeiture, reduction or other adverse modification of the rights under or give rise to any right of termination or acceleration (with or without notice or the lapse of time or both) pursuant to any term or provision of any note,
bond, mortgage, indenture, lease, Permit, Contract or other instrument or document to which Seller is a party or by which its properties or assets are bound or (c) conflict with, or result in any violation of, any law, ordinance, statute, rule or
regulation of any Governmental Entity or any order, writ, injunction, judgment or decree of any court, arbitrator or other Governmental Entity applicable to Seller or its properties or assets, except, in the case of clauses (b) and (c) above, for
conflicts, violations, breaches or other events which would not reasonably be expected to have a Material Adverse Effect with respect to Seller or adversely affect in any material respect the ability of Seller to comply with its obligations under
this Agreement or consummate the transactions contemplated hereby. 
  
 2.3 No Governmental Consent or Approval Required. Except as set forth in Schedule 2.3, no Consent or Permit of, declaration to, or registration, qualification, designation or filing with, any Governmental Entity is required
for or in connection with the execution, delivery and performance by Seller of this Agreement and the Amended License Agreement or the consummation of the transactions contemplated hereby and thereby, other than such Consents, Permits, declarations,
registrations, qualifications, designations and filings, the failure of which to be made or obtained would not reasonably be expected to have a Material Adverse Effect on Seller or adversely affect in any material respect the ability of Seller to
comply with its obligations under this Agreement or consummate the transactions contemplated hereby. 
  
 2.4 Indebtedness. The Company has no outstanding indebtedness to any Person who was or is appointed to act in the capacity of interim Brand
Manager, Seller or any Affiliate thereof or, to the Knowledge of Seller, any employee of Seller. There has never been and is no Brand Manager. Seller has paid its share (pursuant to the Operating Agreement) of all Company Maintenance Fees accrued
prior to the date hereof. To the Knowledge of Seller, and assuming the accuracy of Purchaser’s representation in Section 3.5, the Company has sufficient liquid assets to pay its debts accrued as of the date of this Agreement when due and to
operate its business as it is presently conducted. 
  
 2.5 No
Breach. To the Knowledge of Seller or as set forth in Schedule 2.5, the Company has not taken any action other than those actions expressly permitted under the terms of the Operating Agreement. To the Knowledge of Seller, neither Seller
nor the Company has authorized the interim Brand Manager to take any action not permitted under the Brand Manager Charter in such Person’s capacity as interim Brand Manager. To the Knowledge of Seller there has not been any uncured material
breach of any of the Sublicenses by any of the Sublicensees. 
  

 -6- 

 2.6 Capitalization. Seller owns the Seller Membership Interests beneficially and of record. To the
Knowledge of Seller, the Seller Membership Interests and the 440 Class B Units beneficially owned by Purchaser and the 10 Class B Units beneficially owned by Handspring Corporation constitute all the Membership Interests. Other than pursuant to this
Agreement, none of Seller nor any of its Affiliates has transferred, assigned or otherwise pledged (directly or indirectly), or agreed to transfer, assign or otherwise pledge (directly or indirectly), any equity securities, membership interests,
partnership interests, profit participation rights, voting rights, or similar ownership interests of any class of equity security of the Company, or any securities exchangeable or convertible into or exercisable for such equity securities,
membership interests, profit participation interests, partnership interests, voting rights, or similar ownership interests in the Company to any Person other than Seller. At the Closing, Seller shall deliver to Purchaser good and marketable title to
the Seller Membership Interests, free and clear of all Liens. 
  
 2.7 Intellectual Property. 
  
 (a) As between the
Parties, except for Seller’s rights pursuant to the Amended License Agreement and any licenses granted by the Company to Purchaser, the Company shall own all right, title and interest in and to the Palm Marks and the PalmOne Brand as of the
Closing. 
  
 (b) To the Knowledge of Seller, the Palm Marks and
the PalmOne Brand are free and clear of any Liens created by Seller or created by the Company on the instruction of Seller or permitted by Seller to exist. 
  
 (c) Other than as described in Schedule 2.7(c), the ARSLA and the SARSLA, and other than with respect to the matters set forth in Section 3.6(b),
(i) since the Formation Date and, (ii) to the Knowledge of Seller, from August 30, 2002 to the Formation Date, Seller has not entered into any sublicenses or authorized any third party to enter into any sublicenses of the Palm Marks that deviate
materially from the standard form of trademark sublicense terms and conditions set forth on Schedule 2.7(c). 
  
 (d) To the Knowledge of Seller, there are not any disputes regarding the use of the Palm Marks, except for Company Existing Actions, Company Third Party
Claims and Company Inactive Enforcement Matters and those disputes set forth on Schedule 2.7(d). 
  
 (e) Except for the License Agreement, the Amended License Agreement and the PalmOne License, to the Knowledge of Seller, the Company has not granted any
licenses in the Palm Marks or the Palm One Brand. 
  
 (f) Other
than as set forth on Schedule 2.7(f), to the Knowledge of Seller, none of Seller or any of its Affiliates, by any action or inaction, has allowed or permitted any registration with respect to the Palm Marks to lapse. 
  
 (g) To the Knowledge of Seller, all Palm Domain Names owned or controlled by
Seller are listed on Schedule 2.7(g). 
  

 -7- 

 2.8 Litigation and Orders. Except for Company Existing Actions, Company Third Party Claims and
Company Inactive Enforcement Matters, or as set forth on Schedule 2.7(d), to the Knowledge of Seller (a) there is no claim, arbitration, action, suit or proceeding pending against (i) the Company, or (ii) Seller that alleges infringement by
or non-enforceability of, or directly relates to, the Palm Marks, or (iii) threatened against Seller or the Company that alleges infringement by or non-enforceability of, or directly relates to, the Palm Marks, and (b) there is no grievance or
investigation pending or threatened, in each case by or before any Governmental Entity or arbitration tribunal against Seller or the Company that alleges infringement by or non-enforceability of, or directly relates to, the Palm Marks. To the
Knowledge of Seller, neither Seller nor the Company is in violation of, or default under, any judgment, order, injunction, writ or decree of any Governmental Entity or arbitration tribunal applicable to Seller or the Company that directly relates to
or directly imposes any restriction on the use of the Palm Marks, nor to the Knowledge of Seller has Seller or the Company received any written notice of any material violation of, or default under, any such judgment, order, injunction, writ or
decree. There are no oral or written settlement agreements entered into by Seller or, to the Knowledge of Seller, by the Company, which settle any claim that alleges infringement by, or non-enforceability of, or directly relates to, the Palm Marks.

  
 2.9 Tax. Seller has taken all actions within its
control to ensure that the Company has timely filed all Tax Returns required to be filed with respect to the Company with appropriate Governmental Entities. To the Knowledge of Seller, the Company has not been advised in writing (a) that any of the
Tax Returns with respect to the Company have been or are being audited as of the date hereof, or (b) of any deficiency in assessment or proposed judgment with respect to the Company’s federal, state or local Taxes. 
  
 2.10 No Undisclosed Liabilities. To the Knowledge of Seller, the
Company does not have any material liabilities of any nature that would be required to be reflected in the financial statements (or the notes thereto) of the Company prepared in accordance with U.S. generally accepted accounting principles as of and
through the date hereof in excess of Three Hundred Thousand U.S. Dollars (U.S. $300,000). 
  
 2.11 Contracts. Schedule 2.11 sets forth all Contracts, to the Knowledge of Seller, to which the Company is, or since the Formation Date, has been, a party. 
  
 2.12 Employee Matters. To the Knowledge of Seller, the Company has
never had any employees. To the Knowledge of Seller, there is no consultant to the Company, providing services pursuant to a contract or otherwise, whose service is not terminable at will without any payment or obligation on the part of the Company.

  
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES OF PURCHASER 
  
 As of the date hereof, Purchaser represents and warrants to Seller as follows: 
  
 3.1 Organization and Authority. Purchaser is duly incorporated, validly existing and in good standing under the laws
of the jurisdiction of its incorporation. Purchaser has all requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement

  

 -8- 

 and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action
on the part of Purchaser. This Agreement has been duly executed and delivered by Purchaser and, assuming due execution and delivery by the other Parties, constitutes the valid and binding obligations of Purchaser, enforceable against Purchaser in
accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws and equitable principles relating to or limiting creditors rights generally. Purchaser, in its
capacity as a member of the Company, has approved this Agreement and the transactions contemplated hereby. Purchaser’s Board of Directors has approved this Agreement and the transactions contemplated hereby. 
  
 3.2 Non-Contravention. The execution, delivery and performance by
Purchaser of this Agreement and the consummation of the transactions contemplated hereby will not (a) conflict with, or result in any violation or breach of, any provision of the Charter or Bylaws of Purchaser, (b) conflict with, result in any
violation or breach of, constitute a default under, result in a forfeiture, reduction or other adverse modification of the rights under or give rise to any right of termination or acceleration (with or without notice or the lapse of time or both)
pursuant to any term or provision of any note, bond, mortgage, indenture, lease, Permit, Contract or other instrument or document to which Purchaser is a party or by which its properties or assets are bound or (c) conflict with, or result in any
violation of, any law, ordinance, statute, rule or regulation of any Governmental Entity or any order, writ, injunction, judgment or decree of any court, arbitrator or other Governmental Entity applicable to Purchaser or its properties or assets,
except, in the case of clauses (b) and (c) above, for conflicts, violations, breaches or other events which would not reasonably be expected to have a Material Adverse Effect with respect to Purchaser or adversely affect in any material respect the
ability of Purchaser to comply with its obligations under this Agreement or consummate the transactions contemplated hereby. 
  
 3.3 Consents. No Consent or Permit of, declaration to, or registration, qualification, designation or filing with, any Governmental Entity is
required for or in connection with the execution, delivery and performance by Purchaser of this Agreement or the consummation of the transactions contemplated hereby, other than Consents, Permits, declarations, registrations, qualifications,
designations and filings, the failure of which to be made or obtained would not reasonably be expected to have a Material Adverse Effect on Purchaser or adversely affect in any material respect the ability of the Purchaser to comply with its
obligations under this Agreement or consummate the transactions contemplated hereby. 
  
 3.4 Purchase for Investment. Purchaser is purchasing the Seller Membership Interests for its own account for investment and not with a view to, or in connection with, the distribution thereof. Purchaser
acknowledges that the Seller Membership Interests are not being registered under the Securities Act or any applicable state securities laws and, accordingly, may not be transferred or sold except in compliance with the registration requirements of
the Securities Act and the registration or qualification requirements of applicable state or provincial securities laws or as permitted under an available exemption therefrom. Purchaser is an “accredited investor” as defined in Regulation
D promulgated under the Securities Act. 
  
 3.5 Maintenance
Fees. Purchaser has paid its share (pursuant to the Operating Agreement) of all Company Maintenance Fees accrued prior to the date hereof. 
  

 -9- 

 3.6 Intellectual Property. 
  
 (a) To the Knowledge of Purchaser, there are not any disputes regarding the use of the PalmOne Brand or to any of the other
Palm Marks that Purchaser has used since October 28, 2003, except for Company Existing Actions, Company Third Party Claims and Company Inactive Enforcement Matters. Except for the License Agreement, the Amended License Agreement and the PalmOne
License, to the Knowledge of Purchaser, the Company has not granted any licenses in the Palm Marks or the PalmOne Brand. 
  
 (b) To the Knowledge of Purchaser, from August 30, 2002 to the Formation Date, Palm, Inc. and its Subsidiaries (excluding PalmSource) did not grant any
licenses to the Palm Marks. 
  
 3.7 Litigation. Except for
Company Existing Actions, Company Third Party Claims and Company Inactive Enforcement Matters, to the Knowledge of Purchaser, (a) there is no claim, arbitration, action, suit or proceeding (i) pending against Purchaser that alleges infringement by
or non-enforceability of, or directly relates to, the PalmOne Brand or to any of the other Palm Marks that Purchaser has used since October 28, 2003, or (ii) threatened against Purchaser that alleges infringement by or non-enforceability of, or
directly relates to, the PalmOne Brand or to any of the other Palm Marks that Purchaser has used since October 28, 2003, and (b) there is no grievance or investigation pending or threatened, in each case by or before any Governmental Entity or
arbitration tribunal against Purchaser that alleges infringement by or non-enforceability of, or directly relates to, the PalmOne Brand or to any of the other Palm Marks that Purchaser has used since October 28, 2003. To the Knowledge of Purchaser,
Purchaser is not in violation of, or default under, any judgment, order, injunction, writ or decree of any Governmental Entity or arbitration tribunal applicable to Purchaser that directly relates to or directly imposes any restriction on the use of
the PalmOne Brand or to any of the other Palm Marks that Purchaser has used since October 28, 2003, nor to the Knowledge of Purchaser, has Purchaser received any written notice of any material violation of, or default under, any such judgment,
order, injunction, writ or decree. 
  
 3.8 No Breach. To
the Knowledge of Purchaser, other than as set forth in Schedule 2.5, the Company has not taken any action other than those actions expressly permitted under the terms of the Operating Agreement. To the Knowledge of Purchaser, neither
Purchaser nor the Company has authorized the interim Brand Manager to take any action not permitted under the Brand Manager Charter in such Person’s capacity as interim Brand Manager. 
  
 3.9 Tax. Purchaser has taken all actions within its control to ensure
that the Company has timely filed all Tax Returns required to be filed with respect to the Company with appropriate Governmental Entities. To the Knowledge of Purchaser, the Company has not been advised in writing (a) that any of the Tax Returns
with respect to the Company have been or are being audited as of the date hereof, or (b) of any deficiency in assessment or proposed judgment with respect to the Company’s federal, state or local Taxes. 
  

 -10- 

 ARTICLE IV 
 TAX MATTERS 
  
 4.1 Tax
Returns. 
  
 (a) With respect to each Tax Return, which is
required to be filed for, by, on behalf of or with respect to the Company after the Closing Date, which Tax Return is in respect of any period or portion of any period attributable to a Pre-Closing Period (as defined below), Purchaser (i) shall
cause to be prepared each such Tax Return and (ii) shall determine the portion of the Taxes, if any, shown as due on such Tax Return that is allocable to a Pre-Closing Period (as defined below). Purchaser shall deliver a copy of such Tax Return
thereto to Seller at least fifteen (15) days prior to the due date (including any extension thereof) for filing such Tax Return. Notwithstanding anything to the contrary herein, (A) Purchaser shall consult in good faith with Seller in connection
with the preparation of each such Tax Return and (B) Purchaser shall not file each such Tax Return without the prior written consent of Seller, which consent shall not be unreasonably withheld or delayed. 
  
 (b) In the case of each Tax Return described in Section 4.1(a), not later
than five (5) Business Days before the due date for payment of Taxes with respect to such Tax Return, Seller shall pay to Purchaser an amount equal to the total amount of Taxes, which are the responsibility of Seller under Section 4.2. 

 
 4.2 Liability for Taxes and Related Matters. 
  
 (a) Liability of Seller for Taxes. Seller shall be liable for, and
shall indemnify and hold Purchaser harmless from and against, all Taxes (i) imposed on the Company attributable to Seller’s allocable share of the Company’s income or gain for any taxable year or period or portion thereof that ends on or
before the Closing Date (a “Pre-Closing Period”), or (ii) imposed on Seller for any taxable year or period. 
  
 (b) Purchaser’s Liability for Taxes. Purchaser shall be liable for, and shall indemnify and hold Seller harmless from and against, (i) any
Taxes attributable to Purchaser’s allocable share of income or gain of the Company for a Pre-Closing Period, and (ii) all Taxes of the Company for any taxable year or period that begins after the Closing Date. 
  
 (c) Determination of Liability for Taxes. As of the Closing Date, the
taxable year of the Company shall close and the business of the Company shall continue in accordance with Treasury Regulation Section 1.708-1(b)(4). The Company shall file an election in accordance with Section 754 of the Code. With respect to any
Taxes for any taxable period that includes but does not end as of the Closing Date, the amount of Taxes for which a Party is liable or which is subject to indemnification hereunder attributable to pre-Closing and post-Closing Tax periods shall be
calculated as if such taxable period ended as of the close of business on the Closing Date, except that property, ad valorem, and similar Taxes and exemptions, allowances or deductions that are calculated on an annual basis shall be prorated based
on the number of days in the annual period elapsed through the Closing Date compared to the number of days in the annual period elapsing after the Closing Date, respectively. 
  
  

 -11- 

 (d) Notice and Payment Requirements. The Party seeking indemnification for any Tax (the
“Tax Indemnitee”) agrees to give prompt notice to the Party from whom indemnification is sought (the “Tax Indemnitor”) of the assertion or payment of any claim, or the commencement of any suit, action or proceeding,
in respect of which indemnity may be sought hereunder and will give the Tax Indemnitor factual information (to the extent known to the notifying Party) describing the asserted Tax liability in reasonable detail and shall include copies of any notice
or other document received from any taxing authority in respect of such asserted Tax liability. The failure of the Tax Indemnitee to exercise promptness in such notification shall not amount to a waiver of such claim except to the extent the
resulting delay results in a material detriment to the Tax Indemnitor with respect to the claim. On or after payment of any Taxes or other amounts by the Tax Indemnitee, the Tax Indemnitee shall submit an invoice to the Tax Indemnitor stating that
such Taxes or such other amounts have been paid and giving in reasonable detail the particulars relating thereto. Within thirty (30) days of receipt of such notice, the Tax Indemnitor shall remit payment for such Taxes or other amounts to the Tax
Indemnitee, provided, however, that the Tax Indemnitor shall not be required to make any payment earlier than three (3) days before it is due to the appropriate taxing authority. In the case of a Tax that is contested, payment of the
Tax to the appropriate tax authority will not be considered to be due earlier than the date a final determination (within the meaning of Section 1313(a) of the Code) to such effect is made by the appropriate taxing authority or court. Any payment
required under this Section 4.2 that is not made when due shall bear interest (beginning on the thirtieth (30th) day
after receipt of the written notice) at the rate per annum determined, from time to time, under the provisions of Section 6621(a)(2) of the Code. Notwithstanding anything herein to the contrary, (i) Tax Indemnitee shall keep Tax Indemnitor informed
in all material respects of the status of any claim, suit, action or proceeding and shall consult in good faith with Tax Indemnitor concerning such matter, and (ii) Tax Indemnitee shall not concede, fail to contest, or settle such matter without the
prior written consent of Tax Indemnitor, which consent shall not be unreasonably withheld or delayed. 
  
 (e) Sales, Use and Value-added Taxes. The Parties believe, based on their independent analysis, that the transfer of the Seller Membership
Interests pursuant to this Agreement does not result in the imposition of any sales, use, value-added and similar Taxes and shall act in a manner consistent with such belief. If, contrary to the judgment of the Parties, any sales, use, value-added
or similar Taxes are imposed by any taxing authority, tax or revenue service, or tax tribunal, the Party upon which such Taxes are legally imposed shall pay such Taxes and any related interest, penalty, etc. to the applicable taxing authority and
the other Party shall promptly pay to, indemnify and hold the paying Party harmless from and against fifty percent (50%) of such Taxes and any related interest, penalty, etc.; provided, however, that such Taxes are not recovered by the other
Party. 
  
 4.3 Adjustment to Purchase Price. For Tax
purposes, any payment by Purchaser or Seller under Article VIII will be treated as an adjustment to the purchase price. 
  
 4.4 Assistance and Cooperation. After the Closing Date, each of Seller and Purchaser shall reasonably (a) assist (and cause their respective
Affiliates to assist) the other Party in preparing any Tax Returns or reports which such other Party is responsible for preparing and filing in accordance with this Article IV, (b) cooperate fully in preparing for any audits of, or 
  

 -12- 

 disputes with taxing authorities regarding, any Tax Returns of the Company, (c) make available (and cause their
respective Affiliates to make available) to the other and to any taxing authority as reasonably requested all information, records, and documents relating to Taxes of the Company, (d) provide timely notice to the other in writing of any Tax audits
or assessments of the Company for taxable periods for which the other may have a liability under this Article IV, and (e) furnish the other with copies of all material correspondence received from any taxing authority in connection with any Tax
audit or information request with respect to any such taxable period. 
  
 4.5 Refunds. Any refunds or credits attributable to a Pre-Closing Period shall be for the account of Seller and Purchaser, and if the entire refund or credit is received by Purchaser or the Company, then Purchaser or the Company, as
applicable, shall promptly pay to Seller a portion of such refund or credit based on Seller’s allocable share (as determined under the Operating Agreement) of the Company’s income or gain for the relevant tax period to which the refund or
credit relates. 
  
 ARTICLE V 
 CONDITIONS TO CLOSING 
  
 5.1 Conditions to the Obligations of Purchaser. The obligations of Purchaser to consummate the transactions contemplated hereby are subject to the
fulfillment (or waiver in writing by Purchaser) at or prior to the Closing of the following conditions: 
  
 (a) Accuracy of Representations. The representations and warranties of Seller made in this Agreement shall have been true and correct as of the
date of this Agreement. In addition, Purchaser shall have received a certificate, dated as of the date hereof, executed by an executive officer of Seller to the effect set forth in the immediately preceding sentence. 
  
 (b) Certain Proceedings. There shall not, to the Knowledge of Seller,
be pending or threatened by any Governmental Entity having jurisdiction over the Parties any suit, action or proceeding (i) challenging or seeking to restrain, delay or prohibit the transactions contemplated hereby or seeking to recover or obtain
any material monetary damages from Purchaser or the Company in connection therewith, (ii) seeking to prohibit or limit in any materially restrictive manner the ownership or operation by Purchaser or the Company of any material portion of the
business of the Company, or (iii) seeking to prohibit or restrict the Purchaser or the Company from effectively controlling the business of the Company in any material respect. 
  
 (c) Agreements Executed by Seller. Seller shall have executed and delivered to the Company the Amended License
Agreement and such Amended License Agreement shall be in full force and effect as of the Closing. 
  
 (d) Resignations. Seller shall have delivered to Purchaser written resignations, effective as of the Closing, from (i) each of the members
appointed by Seller to the Board of Directors of the Company and (ii) the interim Brand Manager. 
  

 -13- 

 (e) Palm Domain Names. Purchaser shall have received a certificate, dated as of the date hereof
and executed by an executive officer of Seller, certifying that there are no past due bills for registration fees for the Palm Domain Names listed on Schedule 2.7(g). 
  
 (f) Company Conduct. Seller shall have taken all steps reasonably under its control to cause the Company to execute
and deliver to Purchaser the Amended License Agreement. 
  
 5.2
Conditions to the Obligations of Seller. The obligations of Seller to consummate the transactions contemplated hereby are subject to the fulfillment (or waiver in writing by Seller) at or prior to the date hereof of the following conditions:

  
 (a) Accuracy of Representations. The representations
and warranties of Purchaser made in this Agreement shall have been true and correct as of the date of this Agreement. In addition, Seller shall have received a certificate, dated as of the date hereof, executed by an executive officer of Purchaser
to the effect set forth in the immediately preceding sentence. 
  
 (b) Certain Proceedings. There shall not, to the Knowledge of Purchaser, be pending or threatened by any Governmental Entity having jurisdiction over the Parties any suit, action or proceeding (i) challenging or seeking to restrain,
delay or prohibit the transactions contemplated hereby or seeking to recover or obtain any material monetary damages from Seller in connection therewith, (ii) seeking to prohibit or limit in any materially restrictive manner the ownership or
operation by Purchaser or the Company of any material portion of the business of the Company, or (iii) seeking to prohibit or restrict the Purchaser or the Company from effectively controlling the business of the Company in any material respect.

  
 (c) Company Conduct. Purchaser shall have taken all
steps reasonably under its control to cause the Company to execute and deliver to Seller the Amended License Agreement. 
  
 ARTICLE VI 
 CONTINUING COVENANTS

  
 6.1 Non-Competition. 
  
 (a) With respect to any Operating System Software other than any Operating
System Software that is proprietary to Seller or any of its Affiliates (a “Competitive Product”), each of Purchaser and the Company agrees that, for a period of four (4) years after the Closing Date, it shall not use, license or
otherwise authorize any Person to use or license (other than to Seller and its Affiliates and Sublicensees as permitted under the Amended License Agreement), any Palm Mark or any confusingly similar mark (or any Variant to either of the foregoing)
on, or in direct support of, any Competitive Product that is sold, offered for sale, publicly identified, or otherwise marketed or distributed as a Competitive Product that is proprietary to the Company, Purchaser or any of their Affiliates.
Notwithstanding the foregoing and for the avoidance of doubt, this Section 6.1 shall not prohibit Purchaser nor the Company in any way from: (i) using 
  

 -14- 

 or licensing for use any Palm Mark on goods other than Competitive Products; (ii) using or licensing for use any Palm
Mark with any services; (iii) using or licensing for use the Palm Marks on any product that incorporates Operating System Software, so long as such Operating System Software is not sold, offered for sale or otherwise marketed as a Competitive
Product that is proprietary to the Company, Purchaser or any of their Affiliates; or (iv) selling, offering for sale or otherwise marketing a Competitive Product that is proprietary to Company, Purchaser or any of their Affiliates so long as it is
not sold, offered for sale or otherwise marketed with a Palm Mark or any confusingly similar mark (or any Variant of either of the foregoing). 
  
 (b) For the avoidance of doubt, each of Purchaser and the Company agrees that it shall require, in writing, each new sublicensee and/or transferee to
which it sublicenses or transfers any Palm Mark after the Closing Date to comply with the restrictions set forth in Section 6.1(a). 
  
 6.2 Assistance with PalmSource Brand Transition. Purchaser agrees to work in good faith with Seller to create a plan for Purchaser to provide
in-kind marketing assistance in connection with Seller’s announcement of its new company name in conjunction with Purchaser’s spring 2006 product launches so long as Seller has publicly announced its new corporate identity no later than
February 1, 2006. Subject to the foregoing, Purchaser will use its commercially reasonable efforts to include Seller’s new trademark that it intends to function as the “ingredient” brand used by licensees of its operating system
software (“Seller’s Ingredient Mark”) in advertising specific to Palm OS products launched within the first six months of 2006 as follows: 
  
 (a) For Purchaser’s print product advertising, Seller’s Ingredient Mark and a short attribution (to be agreed upon
by Purchaser and Seller) will be featured; 
  
 (b) For
Purchaser’s web ads, consumers clicking on the ads will be taken to a page (i) that features Seller’s Ingredient Mark and short attribution (to be agreed upon by Purchaser and Seller) and (ii) that contains a link to Seller’s new
primary home page; 
  
 (c) For Purchaser’s product-specific
printed collateral, Purchaser will feature Seller’s Ingredient Mark and a short attribution (to be agreed upon by Purchaser and Seller); 
  
 (d) For Purchaser’s ad kits to retailers, Purchaser will feature Seller’s Ingredient Mark and a short attribution (to be agreed upon by
Purchaser and Seller); 
  
 (e) For Purchaser’s events,
Purchaser will include Seller’s Ingredient Mark on appropriate product-related materials distributed at such events; 
  
 (f) In Purchaser’s press tour materials, Purchaser shall include a slide related to Seller’s Ingredient Mark; 
  
 (g) In Purchaser’s training materials for retail and channel partners,
Purchaser shall include a slide related to Seller’s Ingredient Mark; and 
  

 -15- 

 (h) Purchaser shall include an article/feature on the creation of Seller’s Ingredient Mark within
two e-mails that Purchaser sends out to its registered user base. 
  
 6.3 Execution of Amended License Agreement. Each of Seller and Purchaser shall take all steps reasonably under its control to cause the Company to execute and deliver to Seller the Amended License Agreement. 
  
 ARTICLE VII 
 TERMINATION 
  
 7.1 Termination. This Agreement may be terminated at any time prior to the Closing as follows: 
  
 (a) Mutual Agreement. By the mutual written agreement of Purchaser and Seller; 
  
 (b) Final Order. By Purchaser or Seller if any court or other Governmental Entity of competent jurisdiction shall
have issued or entered an order, writ, injunction or decree which shall have the effect of prohibiting or making illegal the transactions contemplated hereby and such order, writ, injunction or decree shall have become final and nonappealable; or

  
 (c) Breach. By Purchaser or Seller if there shall have
occurred a breach of any representation, warranty, covenant or agreement contained in this Agreement that would give rise to the failure of the conditions to the obligations of such Party set forth in Section 5.1 or 5.2, as applicable, and such
breach, if curable, shall not have been cured within fifteen (15) days after the giving of written notice thereof to the breaching Party, except that such Party shall only be entitled to terminate this Agreement pursuant to this Section 7.1(c) if
such Party is not in breach in any material respect in the performance of its obligations under this Agreement. 
  
 7.2 Notice of Termination; Effect of Termination. Any termination of this Agreement under Section 7.1 in accordance with the terms herein shall be
effective immediately upon the delivery of a valid written notice of the terminating Party to the other Parties hereto. In the event of the termination of this Agreement as provided in Section 7.1, this Agreement shall be of no further force or
effect, except (a) as set forth in this Section 7.2, Article IX, Article X and Article XI, each of which shall survive the termination of this Agreement, and (b) nothing herein shall relieve any Party from liability for any breach of this Agreement
prior to valid termination of this Agreement. The Parties acknowledge that following the Closing, no Party shall have the right to terminate this Agreement for any reason. 
  
 7.3 Survival of Representations and Warranties. The representations and warranties contained in this Agreement shall
expire twenty four (24) months after the Closing Date (the “Expiration Date”), it being acknowledged that if a claim or notice is given prior to the Expiration Date (a) under Article VIII with respect to a Third Party Claim or (b)
by a Party against another Party with respect to a breach of a representation or warranty hereunder, such claim shall continue until it is finally resolved. 
  

 -16- 

 ARTICLE VIII 
 INDEMNIFICATION 
  
 8.1
Indemnification Obligations of Seller. 
  
 (a) In
accordance with and subject to the provisions of this Article VIII, Seller shall indemnify Purchaser and each of its Affiliates and their respective Representatives against all Losses sustained or incurred, directly arising out of, relating to or in
respect of any claims made or asserted by a third party (each, a “Third Party Claim”) in connection with (i) any breach of any of the representations or warranties of Seller contained in this Agreement or in any certificate
delivered by Seller to Purchaser pursuant to the terms of this Agreement, or (ii) any breach of any of the covenants or obligations of Seller contained in this Agreement. For the avoidance of doubt, with respect to a “Third Party Claim,”
the Parties and their respective Affiliates shall not be deemed to be third parties. 
  
 (b) Seller shall have no contribution, indemnity or similar right against the Company with respect to any claim by Purchaser for indemnification pursuant to this Article VIII. 
  
 8.2 Indemnification Obligations of Purchaser. In accordance with and
subject to the provisions of this Article VIII, Purchaser shall indemnify Seller and each of its Affiliates and their respective Representatives against all Losses sustained or incurred, directly arising out of, relating to or in respect of any
Third Party Claims in connection with (a) any breach of any of the representations or warranties of Purchaser contained in this Agreement or in any certificate delivered by Purchaser to Seller pursuant to the terms of this Agreement or (b) any
breach of any of the covenants or obligations of Purchaser contained in this Agreement. 
  
 8.3 Procedures. The obligations of the Parties provided for under Sections 8.1 and 8.2 in respect of any Third Party Claims shall be performed in accordance with the following procedures: 
  
 (a) Each Person entitled to indemnification under Section 8.1 or 8.2 hereof
(each, an “Indemnified Party”) shall give the Party from whom it is seeking indemnification hereunder (the “Indemnifying Party”) written notice as promptly as reasonably practicable after the written assertion of
any Third-Party Claim or commencement of any action, suit or proceeding in respect thereof (and in any event within thirty (30) days after receipt of such written authorization); provided, however, that, if an Indemnified Party fails to give
the Indemnifying Party written notice as provided herein, the Indemnified Party’s rights to indemnification under this Article VIII in respect of such Third-Party Claim shall not be impaired except to the extent that the Indemnifying Party
incurs an out of pocket expense or is prejudiced by such failure (whether as a result of the forfeiture of substantive defenses or otherwise). 
  
 (b) Promptly after receipt of written notice of a Third-Party Claim as contemplated by Section 8.3(a), the Indemnifying Party shall be entitled to assume
the defense, control and settlement of such Third-Party Claim; provided, however, that (i) if, after receipt of 
  

 -17- 

 written notice of such Third-Party Claim, the Indemnifying Party fails within a reasonable time to assume the defense
thereof, the Indemnified Party shall have the right to undertake the defense of such Third-Party Claim on behalf of and for the account and risk of the Indemnifying Party (including the reasonable fees and expenses of counsel for the Indemnified
Party, as applicable), subject to the right of the Indemnifying Party (upon notifying Indemnified Party of its election to do so) to assume the defense of such Third-Party Claim at any time prior to the judgment or other final determination thereof
(in which event the Indemnified Party shall have the right to participate and be informed with respect to such defense), and (ii) if the Indemnified Party so elects, it shall be entitled to employ separate counsel and to participate in, but not
control, the defense of such Third-Party Claim (and the Indemnifying Party shall cooperate with the Indemnified Party so as to allow it to participate in, but not control, the defense thereof), but the fees and expenses of counsel so employed shall
(except as otherwise contemplated by clause (i) above) be borne solely by the Indemnified Party. 
  
 Notwithstanding the foregoing, the Indemnifying Party shall not (A) settle or compromise any Third-Party Claim, or consent to the entry of any judgment
relating thereto, that does not include as an unconditional term thereof the grant by the claimant or plaintiff to each Indemnified Party of a release from any and all liability in respect thereof or (B) settle or compromise any Third-Party Claim,
or consent to the entry of any judgment relating thereto, that would materially and adversely affect the Indemnified Party other than as a result of money damages or other money payments to be fully paid by the Indemnifying Party, without the prior
written consent of the Indemnified Party, which shall not be unreasonably withheld or delayed. In addition, notwithstanding the foregoing, to the extent that the Indemnified Party shall be permitted to assume the defense of a Third Party Claim under
the provisions of this Section 8.3(b), the Indemnified Party shall not settle or compromise such Third-Party Claim, or consent to the entry of any judgment relating thereto, without the consent of Indemnifying Party, which consent shall not be
unreasonably withheld or delayed. 
  
 8.4 Tax Losses.
Losses for which indemnification is provided in Article IV of this Agreement are expressly excluded from the provisions of this Article VIII to the extent such provisions are inconsistent with the provisions of Article IV. 
  
 8.5 Exclusive Remedy. From and after the Closing Date, the provisions
of this Article VIII shall constitute the exclusive remedy on the part of any Party in respect of Third-Party Claims in connection with a breach by any of the other Parties of the representations, warranties and covenants made by such other Parties
in this Agreement; it being understood and agreed that this Article VIII shall apply only to Third-Party Claims under this Agreement and shall not restrict, broaden or otherwise affect any Party’s rights or obligations with respect to any other
claims, including pursuant to this Agreement and any breach of a representation, warranty, or covenant hereunder, or pursuant to any other Contract. 
  
 8.6 Limitations on Indemnification. 
  
 (a) The Indemnified Party shall take commercially reasonable steps to mitigate Losses, including availing itself of any defenses, limitations, rights of
contribution, claims against third parties and other rights at law, and shall provide reasonable evidence and documentation of the nature and extent of any Loss payable by the Indemnifying Party upon reasonable request by the Indemnifying Party.

  

 -18- 

 (b) Any Third-Party Claim indemnifiable under this Article VIII shall be limited to the amount of
out-of-pocket Losses incurred by the Indemnified Party in connection with such Third-Party Claim, net of the dollar amount of any insurance proceeds received by the Indemnified Party with respect to such Losses. Promptly following the occurrence of
any Loss for which an Indemnified Party intends to seek indemnification under this Article VIII, such Indemnified Party shall in good faith use commercially reasonable efforts to make claims for any insurance proceeds receivable with respect to such
Losses, and shall provide notice of the filing of such claim and keep the Indemnifying Party reasonably informed as to the status of such claim. It being understood and agreed that (i) pursuit of insurance claims with respect to Third-Party Claims
shall not impair or delay a Party’s rights to pursue indemnity claims and collect hereunder and (ii) in the event an indemnity claim is paid to an Indemnified Party hereunder and the Indemnified Party later receives insurance proceeds with
respect to such claim, such Indemnified Party shall promptly pay over such proceeds as appropriate to the applicable Indemnifying Party. 
  
 ARTICLE IX 
 LIMITATION ON LIABILITY

  
 EXCEPT FOR DAMAGES ARISING FROM A BREACH BY A PARTY OF ITS
CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT AND EXCEPT FOR DAMAGES ARISING FROM A BREACH OF SECTION 6.1, IN NO EVENT SHALL ANY PARTY’S AGGREGATE LIABILITY UNDER THIS AGREEMENT EXCEED TWENTY FIVE MILLION U.S. DOLLARS (U.S. $25,000,000).
EXCEPT FOR DAMAGES ARISING FROM A BREACH BY A PARTY OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT, IN NO EVENT SHALL ANY PARTY BE LIABLE FOR ANY PUNITIVE DAMAGES UNDER THIS AGREEMENT. 
  
 ARTICLE X 
 DEFINITIONS 
  
 10.1 Certain Definitions. In addition to the other terms defined in this Agreement, the following terms, as used herein, shall have the respective meanings set forth below: 
  
 “Affiliate” means, with respect to any Person, any other
Person directly or indirectly Controlling or Controlled by or under direct or indirect common Control with such Person; provided, however, for purposes of this Agreement, Seller and Purchaser shall not be deemed Affiliates of one another or the
Company and the Company shall not be deemed an Affiliate of Seller or Purchaser. 
  
 “Agreement” means this Agreement, as the same may be amended or supplemented, together with all Exhibits and Schedules attached hereto. 
  

 -19- 

 “Amended License Agreement” means the amended and restated License Agreement in
substantially the form of Exhibit A hereto. 
  
 “ARSLA” means the Amended and Restated Software License Agreement between Seller and Purchaser dated June 4, 2003. 
  
 “Brand Manager” has the meaning set forth in the Operating Agreement. 
  
 “Brand Manager Charter” has the meaning set forth in the Operating Agreement. 
  
 “Business Day” means any day other than a Saturday, Sunday
or other day on which banks in New York are authorized or obligated by law or executive order to close. 
  
 “Bylaws” means, with respect to any corporation, the bylaws of such corporation, as in effect from time to time. 
  
 “Certificate of Formation” means the certificate of
formation of the Company. 
  
 “Charter” means,
with respect to any corporation, the certificate or articles of incorporation or formation (or similar governing document) of such corporation, as in effect from time to time. 
  
 “Clarifications Page” has the meaning set forth in Section 1.5(b). 
  
 “Closing” has the meaning set forth in Section 1.3.

  
 “Closing Date” has the meaning set forth in
Section 1.3. 
  
 “Code” shall mean the United
States Internal Revenue Code of 1986, as amended. 
  
 “Company” has the meaning set forth in the first paragraph of this Agreement. 
  
 “Company Existing Actions” means the disputes listed on the status update entitled “Status Existing Actions Per Brand License As of
03/31/05” provided by Company trademark counsel, Donovan & Yee, to the Company on or about April 21, 2005. 
  
 “Company Inactive Enforcement Matters” means the disputes listed on the status update entitled “Inactive Enforcement Matters As of
03/31/05” provided by Company trademark counsel, Donovan & Yee, to the Company on or about April 21, 2005. 
  
 “Company Maintenance Fees” has the meaning set forth in the Operating Agreement. 
  
 “Company Third Party Claims” means the disputes listed on
the status update entitled “Third Party Claims As of 03/31/05” provided by Company trademark counsel, Donovan & Yee, to the Company on or about April 21, 2005. 
  
 “Competitive Device” means any mobile device having all of the following characteristics: (a) it
incorporates one or more batteries that permits it to operate primarily on 
  

 -20- 

 battery power without being plugged into a wall; (b) has a form factor that weighs fourteen(14) ounces or less, and is
twenty five (25) cubic inches or smaller; (c) has a bitmapped screen capable of displaying text and graphics; and (d) is capable of being used while held in two hands and otherwise unsupported (e.g., does not require the use of the user’s lap,
or a separate stand or table). 
  
 “Competitive
Product” has the meaning set forth in Section 6.1(a). 
  
 “Confidential Information” means any confidential information of, or known to, any Party, including the terms of this Agreement, trade secrets, and information embodied in any writing or tangible objects, including
documents, business plans, source code, documentation, financial analysis, marketing plans, customer names, customer list or customer data. Confidential Information may also include information disclosed by third parties. 
  
 “Consents” means consents, waivers, licenses, permits,
clearances, approvals and other authorizations. 
  
 “Contract” means any contract, agreement, understanding, lease, sublease, license, sublicense, distribution agreement, promissory note, evidence of indebtedness, indenture, instrument, mortgage, insurance policy, annuity or
other binding commitment, whether written or oral. 
  
 “Control” means with respect to a Person, such Person shall be deemed to be in control of another entity only if, and for so long as, it owns or controls more than fifty percent (50%) of the voting power 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). For the purposes of this definition, the term “Control” (including, with correlative meanings, the terms
“controlling”, “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting securities, by Contract or otherwise. 
  
 “Dispute” means any dispute, controversy or claim between or among the Parties in connection with or related to this Agreement. 
  
 “Dispute Expenses” has the meaning set forth in Section 1.6. 
  
 “Expiration Date” has the meaning set forth in Section 7.3.

  
 “Formation Date” means the date of formation
of the Company, June 2, 2003. 
  
 “Governmental
Entity” means any domestic or foreign, national, federal, provincial, state, municipal or other local government or body and any division, agent, commission, board or authority of any quasi-governmental or private body exercising any
statutory, regulatory, expropriation or taxing authority under the authority of any of the foregoing, and any domestic, foreign, international, judicial, quasi-judicial, arbitration or administrative court, tribunal, commission, board or panel
acting under the authority of any of the foregoing. 
  

 -21- 

 “Home Page Banner” has the meaning set forth in Section 1.5(b). 
  
 “Home Page Period” has the meaning set forth in Section
1.5(b). 
  
 “Indemnified Party” has the meaning
set forth in Section 8.3. 
  
 “Indemnifying
Party” has the meaning set forth in Section 8.3. 
  
 “Knowledge” means, (a) with respect to Seller, the actual knowledge, without any requirement of investigation, of David Nagel, Doreen Yochum, Gabi Schindler, Geraldine McGrath, Patricia Cox, Ira Cook and Craig Horak and (b)
with respect to Purchaser, the actual knowledge, without any requirement of investigation, of Edward Colligan, Mary Doyle, Kenneth Wirt, Page Murray, Melissa Cha and Robert Booth. 
  
 “License Agreement” means that certain Trademark License Agreement, amended and restated as of September
24, 2003 and made effective as of the effective date of the Tax Free Spin-Off, by and between Seller and the Company. For the absence of doubt, it is understood that the “License Agreement” does not refer to any amendment or restatement
thereof concurrent with or following the date of this Agreement. 
  
 “Lien” means (a) any mortgage, pledge, security interest, lien, charge, encumbrance, privilege, deposit, easements, reserves, conditional sale contracts, ownership or title retention agreements, equity, claim, option,
easement, right of way, right of refusal, encroachment, restrictive covenant, title defect, tenancy, right or restriction on transfer of any nature whatsoever and (b) any arrangement or condition that in substance secures payment or performance of
an obligation; provided, however, that in no event shall “Lien” be deemed to include licenses to intellectual property. 
  
 “Losses” means any and all fines, liabilities, judgments, claims, losses, costs, expenses, or damages, including in each case, interest,
penalties, reasonable attorneys’ fees and costs of investigations and litigation. 
  
 “Material Adverse Effect” means with respect to a Party, any material adverse effect on the operations, assets, properties, business, condition (financial or otherwise) or results of operations of
such Party, taken as a whole with its Subsidiaries. 
  
 “Membership Interests” has the meaning set forth in the Operating Agreement. 
  
 “NDA” means that certain Reciprocal Nondisclosure Agreement between Seller and Purchaser effective as of January 25, 2005. 
  
 “Operating Agreement” means that certain Operating Agreement
of the Company, amended and restated as of September 24, 2003 and made effective as of June 2, 2003, and as further amended effective as of the effective date of the Tax Free Spin-Off and pursuant to the Unit Transfer Consent dated as of the date
hereof. For the avoidance of doubt, it is understood that the “Operating Agreement” does not refer to any amendment or restatement thereof following the date of this Agreement. 
  

 -22- 

 “Operating System Software” means a computer program for use in a Competitive Device
that (a) manages other computer programs and system resources, (b) is or can be used, directly or indirectly, by end user application programs or application enabling programs to request services through a defined API, (c) contains a distinctive
User Interface and (d) allows other software to execute without direct interaction with the underlying system hardware. 
  
 “Palm.com Site” means the website www.palm.com. 
  

“Palm Domain Names” has the meaning set forth in the License Agreement. 
  
 “Palm Marks” has the meaning set forth in the License Agreement. 
  
 “PalmOne Brand” has the meaning set forth in the License
Agreement. 
  
 “PalmOne Home Page Launch” has the
meaning set forth in Section 1.5(a). 
  
 “PalmOne
License” has the meaning set forth in the License Agreement. 
  
 “Party” means each of the Company, Purchaser and Seller. 
  
 “Permit” means any license, permit, franchise, certificate of authority or order, or any waiver of the foregoing, required to be issued by any Governmental Entity. 
  
 “Person” means any individual, corporation, partnership,
joint venture, limited liability company, limited liability partnership, association, joint stock company, trust, unincorporated organization or other organization, whether or not a legal entity, or any Governmental Entity. 
  
 “Presence Period” has the meaning set forth in Section
1.5(b). 
  
 “Products Page Banner” has the
meaning set forth in Section 1.5(b). 
  
 “Products Page
Period” has the meaning set forth in Section 1.5(b). 
  
 “Purchaser” has the meaning set forth in the first paragraph of this Agreement. 
  
 “Representatives” means with respect to each Party, its directors, officers, employees, agents, counsel and auditors. 
  
 “SARSLA” means the Second Amended and Restated Software
License between Purchaser and Seller executed as of the Closing Date. 
  
 “Schedule” means a schedule delivered by Seller and the Company to Purchaser, on the one hand, or Purchaser to Seller, on the other hand, as required under the terms of this Agreement. 
  
 “Securities Act” means the Securities Act of 1933, as
amended. 
  
 “Seller” has the meaning set forth
in the first paragraph of this Agreement. 
  
  

 -23- 

 “Seller-Controlled Palm Domain Names” means the Palm Domain Names, excluding the
PalmSource Controlled Domain Names (as such term is defined in the Amended License Agreement), that Seller owns or controls as of the Closing Date. 
  
 “Seller Membership Interests” means 550 Class A Units of the Company. 
  
 “Seller Palm.com Site Content” means the Home Page Banner and the Products Page Banner. 
  
 “Seller’s Ingredient Mark” has the meaning set forth in
Section 6.2. 
  
 “Sublicense” means any of
Seller’s outbound operating system licenses. 
  
 “Sublicensee” means those Persons (other than Seller, Purchaser or the Company) party to a Sublicense. 
  
 “Subsidiary” means with respect to a Person, any other corporation, limited liability company, general or limited partnership,
unincorporated association or other business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person, or one or more of the other Subsidiaries of such Person or a combination thereof, or (b) if a limited liability company, partnership, association or
other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by such Person, or one or more Subsidiaries of such Person or a combination thereof.

  
 “Tax” or “Taxes” mean all
taxes, charges, fees, levies or other like assessments imposed or assessed by any Governmental Entity, including without limitation income, profits, windfall profit, employment (including FICA, Medicare and unemployment insurance), withholding,
payroll, franchise, gross receipts, sales, use, transfer, stamp, occupation, real or personal property, ad valorem, value added, premium, and excise taxes, and any other like government charges, and includes all penalties, fines, assessments,
additions to tax, and interest resulting from, attributable to, or incurred in connection with such Taxes or any contest or dispute thereof, and any liability for the Taxes of another Person whether by contract, as a transferee, successor or
otherwise. 
  
 “Tax-Free Spin-Off” means the
distribution of common stock (and preferred stock, if any) of Seller or common stock (and preferred stock, if any) of a Person that is a successor to Seller to holders of common stock of Purchaser that was intended to qualify as a tax-free
distribution under Section 355 of the Internal Revenue Code of 1986, as amended (or any corresponding provision of succeeding law). 
  
 “Tax Indemnitee” has the meaning set forth in Section 4.2(d). 
  
 “Tax Indemnitor” has the meaning set forth in Section 4.2(d). 
  

 -24- 

 “Tax Return” of a Person means all returns, declarations, reports, estimates,
information returns and statements required to be filed with a Governmental Entity by or with respect to that Person in respect of any Taxes. 
  
 “Third Party Claim” has the meaning set forth in Section 8.1(a). 
  
 “Total Consideration” has the meaning set forth in Section 1.2. 
  
 “Unit” means a unit of relative Membership Interest in the
Company, which is designated as a “Class A Unit” or a “Class B Unit.” 
  
 “User Interface” shall mean a system program that governs the means by which a user of an electronic device or computer interacts with the electronic device or computer, and includes the appearance,
position and functionality of the startup screen, program launcher, and other common interface elements such as menus, buttons and dialog boxes, as well as the applications bundled with the system program. 
  
 “Variants” means, with respect to any trademark, service
mark, trade name or domain name, any and all translations, transliterations, homonyms, symbolic representations, and any variations in stylization and capitalization thereof. 
  
 ARTICLE XI 
 MISCELLANEOUS 
  
 11.1 Dispute Resolution.
Any Dispute will be initiated upon written notice to the other Party in the Dispute. Any Dispute will be resolved, subject to Section 11.13, in the following manner: 
  
 (a) First, an appropriate senior executive (e.g., senior vice president level or above) of each Party to the Dispute, each
of whom shall have the authority to resolve any such Dispute for their respective companies shall promptly meet to discuss and attempt to resolve the Dispute within five (5) Business Days after the date of the receipt of notice of the Dispute.

  
 (b) If the Dispute is not resolved during that time by the
senior executives pursuant to Section 11.1(a), and if the Party initiating the Dispute wishes to pursue its rights relating to such Dispute, then such Dispute will be submitted to the CEOs or acting CEOs of each Party to the Dispute, who will
promptly meet and attempt to resolve such Dispute within ten (10) calendar days after the date of the initial meeting between such CEOs or acting CEOs. 
  
 (c) Upon the expiration of the time period set forth in Section 11.1(b), if the Dispute has not been resolved, and unless the Party initiating the Dispute
does not wish to pursue its rights relating to such Dispute, then such Dispute will be automatically submitted to mediation. The mediation will be conducted in Santa Clara, San Mateo or San Francisco counties by a single mediator from JAMS. The
mediator shall be selected by the Parties to the Dispute by mutual agreement. If mutual agreement is not reached, the mediator shall be selected pursuant to the rules for selection of arbitrators in the JAMS Comprehensive Arbitration Rules and
Procedures. The mediator shall have thirty (30) days from the submission to mediation to attempt to resolve such Dispute. 
  

 -25- 

 (d) If the Dispute is not resolved within thirty (30) days of its initiation pursuant to Section 11.1(c),
and if the party initiating the Dispute wishes to pursue its rights relating to such Dispute, then such Dispute will be submitted to final and binding arbitration as follows: (i) arbitration will be held in Santa Clara County, California, in
accordance with the JAMS Comprehensive Arbitration Rules and Procedures and the arbitration will be conducted by a single arbitrator selected by mutual agreement, provided that if mutual agreement is not reached, the arbitrator shall be
selected from the JAMS “Bay Area Intellectual Property” list (exclusive of the mediator) pursuant to the JAMS Comprehensive Arbitration Rules and Procedures; (ii) the decision of the arbitrator will be final and non-appealable (other than
for fraud) and may be enforced in any court of competent jurisdiction; (iii) the use of any mediation or other “alternative dispute resolution” procedures shall not be construed under the doctrine of laches, waiver or estoppel to adversely
affect the rights of any Party to the Dispute; (iv) the arbitration award shall be issued within thirty (30) days of the final submission of the matter to the arbitrator, and in all events within six (6) months of the initiation of the arbitration;
(v) discovery shall be allowed only pursuant to Rule 17 of the JAMS Comprehensive Arbitration Rules and Procedures; and (vi) the costs and expenses of the mediator and arbitrator and any other costs, fees and expenses (including attorneys’ and
experts’ fees) relating to any mediation and arbitration under this Section 11.1 shall be paid by the non-prevailing Party in the arbitration. 
  
 11.2 Amendments. This Agreement may not be amended or modified except by a written instrument executed by each of the Parties. 
  
 11.3 Assignment. None of the Parties may assign this Agreement or its
rights or obligations hereunder to any third party without the prior written consent of the other Parties. Any attempted assignment in violation of this Section 11.3 shall be void. 
  
 11.4 Notices. All notices or communications required or permitted to be given hereunder shall be in writing and shall
be delivered by hand or sent by telefax or sent, postage prepaid, by registered, certified or express mail or reputable overnight courier service and shall be deemed given when so delivered by hand, or telefaxed, or if mailed, three days after
mailing (one (1) Business Day in the case of express mail or overnight courier service), as follows (or such other address as such Party may designate in writing): 
  
 If to Seller: 
  
 PalmSource, Inc. 
 1188 E. Arques Avenue

 Sunnyvale, CA 94085-4602 
 Attention: CEO 
 Facsimile: (408) 400-1590 
  

 -26- 

 with copies to: 
  

PalmSource, Inc. 
 1188 E. Arques Avenue

 Sunnyvale, CA 94085-4602 
 Attention: Legal Department 
 Facsimile: (408) 400-1590 
  
 and 
  
 Howard Rice Nemerovski Canady Falk & Rabkin 
 Three Embarcadero Center, Seventh Floor 
 San Francisco, CA 94111 
 Attention: Deborah Marshall, Esq. 
 Facsimile:
(415) 217-5910 
  
 If to Purchaser: 
  
 palmOne, Inc. 
 400 N. McCarthy Blvd. 
 Milpitas, California
95035 
 Attention: CEO 
 Facsimile: (408) 503-8280 
  
 with copies to: 

 
 palmOne, Inc. 
 400 N. McCarthy Blvd. 
 Milpitas, California
95035 
 Attention: General Counsel 
 Facsimile: (408) 503-8280 
  
 and 
  
 Wilson Sonsini Goodrich & Rosati, Professional Corporation 
 650 Page Mill Road 
 Palo Alto, California
94304 
 Attention: Bradley L. Finkelstein, Esq. 
 Facsimile: (650) 493-6811 
  
 11.5
Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. If any provision of this
Agreement, or the application thereof to any Person or in any circumstance, is invalid or unenforceable, (a) a suitable and equitable provision shall be substituted therefor in order to carry out, so far as may be valid and enforceable, the intent
and purpose of such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other Persons, entities or circumstances shall 
  

 -27- 

 not be affected by such invalidity or unenforceability, nor shall such invalidity or unenforceability affect the validity
or enforceability of such provision, or the application thereof, in any other jurisdiction. 
  
 11.6 Counterparts. This Agreement may be executed in one or more counterparts, all of which together shall constitute one and the same instrument. 
  
 11.7 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of
Delaware. 
  
 11.8 Interpretation. When a reference is made
in this Agreement to an Article, Section, Exhibit or Schedule, such reference is to an Article or Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Any rule of construction to the effect that ambiguities are to be resolved against the drafting Party will not be applied in the
construction or interpretation of this Agreement. Whenever the words “include,” “includes” and “including” are used in this Agreement, they are deemed to be followed by the words “without limitation.” For all
purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires, the terms defined include the plural as well as the singular, and the words “herein,” “hereof” and “hereunder”
and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision. 
  
 11.9 Entire Agreement. This Agreement and the Amended License Agreement, together with the Schedules and Exhibits attached hereto and thereto,
constitute the entire agreement among the Parties with respect to the subject matter hereof. This Agreement and the Amended License Agreement supersede all prior agreements among the Parties with respect to the subject matter hereof. The Parties
agree that execution of this Agreement constitutes affirmative consent by both a Supermajority in Interest and a Majority in Interest with respect to the Members and the Board (all as defined in the Operating Agreement) under the Operating Agreement
and waiver of any conflicts under the Operating Agreement for all actions taken in furtherance of the transactions contemplated hereby. 
  
 11.10 Expenses. Except as specifically set forth herein, each Party shall pay its own expenses incident to the negotiation, preparation and
performance of this Agreement and the transactions contemplated hereby, including fees, expenses and disbursements of their respective investment bankers, accountants and counsel. 
  
 11.11 No Third Party Beneficiaries. Except for Article VIII, nothing in this Agreement, expressed or implied, is
intended to confer upon any Person, other than the Parties or their respective successors, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 
  
 11.12 Confidentiality. The Parties hereby agree that the terms and conditions set forth in the NDA with respect to
the use and treatment of Information (as defined in the NDA) of any other Party shall apply with respect to any Information disclosed by any other Party or its 
  

 -28- 

 Representatives (as defined in the NDA) in connection with this Agreement and the terms of this Agreement, and that the
terms of the NDA are incorporated herein by reference; provided, however, that (a) the term “Purpose” as used in connection with this Agreement shall mean the fulfillment by any Party of its obligations, or the exercise by such Party of
its rights, under this Agreement, (b) this Agreement may be filed with the Securities and Exchange Commission if so required pursuant to applicable law, and (c) the obligations of confidentiality of each Party with respect to any Information
disclosed by any other Party or its Representatives shall survive termination (if any) of this Agreement. For the avoidance of doubt, the provisions contained in Section 7.0 of the NDA shall not apply following the execution of this Agreement and
the Standstill Period (as defined in the NDA) shall expire in accordance with its terms. The Parties shall cooperate with each other with respect to all public communications, including regulatory filings, concerning the disclosure of another
party’s Information, this Agreement or the transactions contemplated hereby. 
  
 11.13 Specific Performance; Injunctive Relief. 
  
 (a) The Parties acknowledge that there may be no adequate remedy at law for a violation of any of the covenants or agreements set forth herein. Therefore, it is agreed that, subject to Section 11.13(b), in addition to
the remedies set forth in Section 8.5, and without being required to go through the procedures set forth in Section 11.1 prior to making a claim for specific performance or equitable relief, each Party shall have the right to seek to enforce such
covenants and agreements by specific performance, injunctive relief or by any other means available to such Party at law or in equity. 
  
 (b) Purchaser and the Company acknowledge and agree that any breach of their obligations under Section 6.1 of this Agreement may result in irreparable
harm to Seller that cannot be reasonably or adequately compensated in damages, and that Seller will be entitled to seek injunctive and/or equitable relief to prevent such a breach and to secure enforcement thereof. Purchaser and the Company
acknowledge and agree that, in the event Seller seeks injunctive and/or equitable relief alleging a breach of Section 6.1 by Purchaser or the Company, neither Purchaser nor the Company shall claim that its alleged actions do not constitute
irreparable harm. For the avoidance of doubt, Purchaser and the Company may in their defense assert (i) that Seller fails to prove a likelihood of success on the merits; and (ii) except as precluded by the previous sentence, any other claim,
counterclaim or defense. Purchaser and the Company acknowledge and agree that Seller shall not be required to post a bond in connection with Seller seeking injunctive and/or equitable relief based on any alleged breach of Section 6.1 by Purchaser or
the Company. Purchaser, the Company and Seller acknowledge and agree that, in the event that Seller prevails in its claim for injunctive and/or equitable relief based on a breach of Section 6.1 by Purchaser or the Company, Seller’s injunctive
and equitable remedy shall be the right to (A) immediately stop Purchaser and the Company from distributing a Competitive Product that violates Section 6.1 and (B) require Purchaser and Company to recall from its distributors, resellers and
customers (other than end-users, either individuals or enterprise customers) a Competitive Product that violates Section 6.1. 
  

 -29- 

 (c) Any claim pursuant to this Section 11.1 will be subject to the exclusive jurisdiction of the state
and federal courts in Santa Clara County, California, and each Party hereby irrevocably consents to the exclusive personal jurisdiction thereof and agrees to service of process by such courts with respect to such claims. 
  

 -30- 

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

			
	PALMSOURCE, INC.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
	
	PALM TRADEMARK HOLDING COMPANY, LLC
		
	By:	 	  

	Name:	 	 
	Title:	 	 
	
	PALMONE, INC.
		
	By:	 	  

	Name:	 	 
	Title:	 	 

  
 [SIGNATURE PAGE
TO PURCHASE AGREEMENT] 

 Execution Copy 
  
 Schedule 1.2 
  
 Purchaser shall make the payments set forth below to Seller by wire transfer to the account designated in writing by Seller. 
  

			
	 Payment Amount

	 	 Date Payable

	$7,500,000 USD	 	Closing Date
	$7,500,000 USD	 	1st Anniversary of Closing Date
	$7,500,000 USD	 	2nd Anniversary of Closing Date
	$3,750,000 USD	 	3rd Anniversary of Closing Date
	$3,750,000 USD	 	6 months after the 3rd Anniversary of Closing Date

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