Document:

Exhibit 10.7

 

 

SUMMARY PLAN DESCRIPTION

 

Ciphergen Biosystems Inc. 401(k) Plan

 

 

 

 

Ciphergen
Biosystems Inc. 401(k) Plan

	
   

  	
   

  	
   

  	
   

  
	
  I.

  	
   

  	
  BASIC PLAN INFORMATION

  
	
   

  	
  I.

  	
   

  	
  ACCOUNT

  
	
   

  	
  II.

  	
   

  	
  BENEFICIARY

  
	
   

  	
  III.

  	
   

  	
  EMPLOYEE

  
	
   

  	
  IV.

  	
   

  	
  EMPLOYER

  
	
   

  	
  V.

  	
   

  	
  ERISA

  
	
   

  	
  VI.

  	
   

  	
  HIGHLY COMPENSATED
  EMPLOYEE

  
	
   

  	
  VII.

  	
   

  	
  NON-HIGHLY
  COMPENSATED EMPLOYEE

  
	
   

  	
  VIII.

  	
   

  	
  PARTICIPANT

  
	
   

  	
  IX.

  	
   

  	
  PLAN ADMINISTRATOR

  
	
   

  	
  X.

  	
   

  	
  PLAN NUMBER

  
	
   

  	
  XI.

  	
   

  	
  PLAN
  SPONSOR

  
	
   

  	
  XII.

  	
   

  	
  PLAN YEAR

  
	
   

  	
  XIII.

  	
   

  	
  SERVICE OF PROCESS

  
	
   

  	
  XIV.

  	
   

  	
  TRUSTEE

  
	
  II.

  	
   

  	
  PARTICIPATION

  
	
   

  	
  I.

  	
   

  	
   

  	
  ELIGIBILITY REQUIREMENTS

  
	
  III.

  	
   

  	
  CONTRIBUTIONS

  
	
   

  	
  I.

  	
   

  	
   

  	
  COMPENSATION

  
	
   

  	
  II.

  	
   

  	
   

  	
  EMPLOYEE PRETAX
  CONTRIBUTIONS

  
	
   

  	
   

  	
  1.

  	
   

  	
  Regular Contributions

  
	
   

  	
   

  	
  2.

  	
   

  	
  Age 50 Or Over
  Catch-Up Contributions

  
	
   

  	
  III.

  	
   

  	
   

  	
  EMPLOYER MATCHING
  CONTRIBUTIONS

  
	
   

  	
   

  	
  1.

  	
   

  	
  Discretionary
  Matching Contributions

  
	
   

  	
  IV.

  	
   

  	
   

  	
  NONELECTIVE
  EMPLOYER CONTRIBUTIONS

  
	
   

  	
   

  	
  1.

  	
   

  	
  Discretionary
  Nonelective Employer Contributions

  
	
   

  	
   

  	
  2.

  	
   

  	
  Qualified
  Nonelective Contributions

  
	
   

  	
  V.

  	
   

  	
   

  	
  LIMIT ON CONTRIBUTIONS

  
	
   

  	
  VI.

  	
   

  	
   

  	
  ROLLOVER CONTRIBUTIONS

  
	
  IV.

  	
   

  	
  INVESTMENTS

  
	
   

  	
  I.

  	
   

  	
   

  	
  INVESTMENTS

  
	
   

  	
  II.

  	
   

  	
   

  	
  STATEMENT OF ACCOUNT

  
	
   

  	
  III.

  	
   

  	
   

  	
  404(C)
  ELECTION

  
	
  V.

  	
   

  	
  VESTING

  
	
   

  	
  I.

  	
   

  	
   

  	
  FORFEITURE AND
  RE-EMPLOYMENT

  
	
  VI.

  	
   

  	
  PARTICIPANT LOANS

  
	
   

  	
  I.

  	
   

  	
   

  	
  LOAN RULES

  
	
   

  	
   

  	
  1.

  	
   

  	
  Loan
  Application

  
	
   

  	
   

  	
  2.

  	
   

  	
  Loan Amount

  
	
   

  	
   

  	
  3.

  	
   

  	
  Number
  of Loans

  
	
   

  	
   

  	
  4.

  	
   

  	
  Interest
  Rate

  
	
   

  	
   

  	
  5.

  	
   

  	
  Loan Repayments
  And Loan Maturity

  
	
   

  	
   

  	
  6.

  	
   

  	
  Source of Loan Proceeds

  
	
   

  	
   

  	
  7.

  	
   

  	
  Default or
  Termination Of Employment

  
	
  VII.

  	
   

  	
  IN SERVICE WITHDRAWALS

  
							

 

 

2

 

	
   

  	
  I.

  	
   

  	
   

  	
  HARDSHIP WITHDRAWALS

  
	
   

  	
  II.

  	
   

  	
   

  	
  WITHDRAWALS AFTER AGE
  59 1/2

  
	
   

  	
  III.

  	
   

  	
   

  	
  WITHDRAWALS AFTER AGE
  70 1/2

  
	
   

  	
  IV.

  	
   

  	
   

  	
  WITHDRAWALS
  AFTER NORMAL RETIREMENT AGE

  
	
   

  	
  V.

  	
   

  	
   

  	
  WITHDRAWALS OF
  ROLLOVER CONTRIBUTIONS

  
	
  VIII.

  	
   

  	
  DISTRIBUTION OF BENEFITS

  
	
   

  	
  I.

  	
   

  	
   

  	
  ELIGIBILITY FOR BENEFITS

  
	
   

  	
  II.

  	
   

  	
   

  	
  DISTRIBUTABLE EVENTS

  
	
   

  	
   

  	
  1.

  	
   

  	
  Death

  
	
   

  	
   

  	
  2.

  	
   

  	
  Disability

  
	
   

  	
   

  	
  3.

  	
   

  	
  Retirement

  
	
   

  	
   

  	
  4.

  	
   

  	
  Termination of Employment

  
	
   

  	
  III.

  	
   

  	
  FORM
  OF PAYMENTS

  
	
   

  	
   

  	
  1.

  	
  Lump Sum Distributions

  
	
   

  	
   

  	
   

  	
  A)

  	
  CASH DISTRIBUTION

  
	
   

  	
   

  	
   

  	
  B)

  	
  DIRECT ROLLOVER
  DISTRIBUTION

  
	
   

  	
   

  	
   

  	
  C)

  	
  COMBINATION
  CASH DISTRIBUTION AND DIRECT ROLLOVER DISTRIBUTIONS

  
	
   

  	
   

  	
  2.

  	
   

  	
  Installment Distributions

  
	
  IX.

  	
   

  	
  MISCELLANEOUS INFORMATION

  
	
   

  	
  I.

  	
   

  	
  BENEFITS NOT INSURED

  
	
   

  	
  II.

  	
   

  	
  ATTACHMENT OF YOUR
  ACCOUNT

  
	
   

  	
  III.

  	
   

  	
  PLAN-TO-PLAN
  TRANSFER OF ASSETS

  
	
   

  	
  IV.

  	
   

  	
  PLAN
  AMENDMENT

  
	
   

  	
  V.

  	
   

  	
  PLAN
  TERMINATION

  
	
   

  	
  VI.

  	
   

  	
  INTERPRETATION OF PLAN

  
	
   

  	
  VII.

  	
   

  	
  ELECTRONIC DELIVERY

  
	
  X.

  	
   

  	
  INTERNAL REVENUE
  SERVICE TESTS

  
	
   

  	
  I.

  	
   

  	
  NON-DISCRIMINATION TESTS

  
	
   

  	
  II.

  	
   

  	
  TOP
  HEAVY TEST

  
	
  XI.

  	
   

  	
  PARTICIPANT RIGHTS

  
	
   

  	
  I.

  	
   

  	
  CLAIMS

  
	
   

  	
   

  	
  1.

  	
   

  	
  Claims
  Procedures

  
	
   

  	
   

  	
  2.

  	
   

  	
  Review
  Procedures

  
	
   

  	
  II.

  	
   

  	
  STATEMENT OF ERISA RIGHTS

  
	
  XII.

  	
   

  	
  SERVICES AND FEES

  
	
  XIII.

  	
   

  	
  APPENDIX A:
  INVESTMENT OPTIONS

  
	
  XIV.
  

  	
   

  	
  APPENDIX
  B: SPECIAL TAX NOTICE REGARDING PLAN PAYMENTS

  
							

 

3

 

SUMMARY PLAN DESCRIPTION

CIPHERGEN BIOSYSTEMS INC. 401(K) PLAN

 

The Ciphergen
Biosystems Inc. 401(k) Plan of Ciphergen Biosystems, Inc. has been amended
effective as of  10/01/2004  (the ‘Effective Date’). The original
effective date of the Plan is 01/01/1996. 
This 401(k) and Profit Sharing Plan is a defined contribution plan and
is intended to be a qualified retirement plan under the Internal Revenue Code
Section 401(a).

 

The purpose of the Plan is to enable eligible employees to save for
retirement. As well as retirement benefits, the Plan provides certain benefits
in the event of death, disability, or other termination of employment.  The Plan is for the exclusive benefit of
eligible employees and their Beneficiaries.

 

This booklet is called a Summary Plan Description (“SPD”) and it
contains a summary in understandable language of your rights and benefits under
the Plan.  If you have difficulty
understanding any part of this SPD, you should contact the Plan Administrator
identified in the Basic Plan Information section of this document during normal
business hours for assistance.

 

This SPD is a brief
description of the principal features of the governing Basic Plan Document and
Trust Agreement and is not meant to interpret, extend or change these
provisions in any way.  This SPD also
includes provisions of the Economic Growth and Tax Relief Reconciliation Act of
2001 (“EGTRRA”), which have been adopted as good faith amendments in accordance
with IRS Notice 2001-57, and which are generally effective on the first day of
the first plan year beginning in 2002, unless otherwise specified herein. A
copy of the Basic Plan Document and Trust Agreement, as amended, is on file
with the Plan Administrator and may be read by any employee at any reasonable
time.  The Basic Plan Document and Trust
Agreement (as amended) shall govern if there is a discrepancy between this SPD
and the actual provisions of the Plan.

 

4

 

I.                 Basic Plan
Information

The information in this section contains definitions to some of the
terms that may be used in this Summary Plan Description.  If the first letter of any of these
definitions below is capitalized then it represents the indicated defined term.

I.                                         Account

An account shall be established by the Trustee to record contributions
made on your behalf and any related income, expenses, gains or losses.  It may also be referred to as an account
balance.

II.                                     Beneficiary

This is the person or persons (including a trust) you designate, or who
are identified by the plan document if you fail to designate or improperly
designate, who will receive your benefits in the event of your death.  You may designate more than one beneficiary.

III.                                 Employee

An employee is an individual who is employed by your Employer as a
common law employee or, in certain cases, as a leased employee and is not
terminated.

IV.                                Employer

The name, address and
business telephone number of your Employer is:

Ciphergen Biosystems,
Inc.

6611 Dumbarton Circle

Fremont, CA  94555

(510) 505-2143

 

Your Employer’s federal
tax identification number is: 33-0595156.

V.                                    ERISA

The Employee Retirement Income Security Act of 1974 (ERISA) identifies
the rights of Participants and Beneficiaries covered by a qualified retirement
plan.

VI.                                Highly Compensated
Employee

An Employee is considered a highly compensated employee if (i) at
anytime during the current or prior year you own, or are considered to own, at
least five percent of your Employer, or (ii) received compensation from your
Employer during the prior year in excess of $90,000, as adjusted and you are in
the top paid group consisting of the top 20% of Employees ranked by
Compensation.

VII.                            Non-Highly Compensated
Employee

An Employee who is not a Highly Compensated Employee.

VIII.                        Participant

A participant is an eligible Employee who has satisfied the eligibility
and entry date requirements and is eligible to participate in the Plan or a
formerly eligible Employee who has an account balance remaining in the Plan.

IX.                                Plan Administrator

The Plan Administrator is
responsible for the administration of the Plan and its duties are identified in
the Plan Document.  In general, the Plan
Administrator is responsible for providing you and your Beneficiaries 

 

5

 

with information about
your rights and benefits under the Plan. 
The name, address and business telephone number of the Plan
Administrator is:

Ciphergen Biosystems, Inc.

6611 Dumbarton Circle

Fremont, CA  94555

(510) 505-2143

 

X.                                    Plan Number

The three digit IRS number for the Plan is 001.

XI.                                Plan Sponsor

Your Employer is the sponsor of the Plan.

XII.                            Plan Year

The Plan Year is the
twelve-month period ending on the last day of December.  Your Employer may only change or have changed
the Plan Year by amending and restating to a new Plan Document.

XIII.                        Service of Process

The plan’s agent for
service of legal process is the Plan Administrator.

XIV.                       Trustee

The trustee is
responsible for trusteeing the Plan’s assets. 
The trustee’s duties are identified in the Trust Agreement and relate
only to the assets in its possession. 
The name and address of the Plan’s Trustee are:

Fidelity Management Trust Company

Attn: FIIS Risk
Management

82 Devonshire Street

Boston, MA 02109

II.             Participation

I.                       Eligibility Requirements

You are eligible to participate in the Plan if you are an Employee and
are not:

Ÿ                  a resident of Puerto Rico

Ÿ                  Employees in an internship status or on an internal
temporary status

 

The plan requires you to attain the age of 21.  Upon satisfying this requirement you will
become eligible to participate in the Plan on the first day of each month.

 

Once you become a Participant you are eligible to participate in the Plan
until you terminate your employment with your Employer or become a member of a
class of Employees excluded from the Plan. 
If you terminate your employment after you have met the eligibility
requirements, and are later re-employed by your Employer, you will again be
eligible to participate in the Plan after you complete one hour of service.

 

III.           Contributions

 

After you satisfy the participation requirements in Section II of this
Summary Plan Description, you will be eligible to make pretax contributions.  In addition, your Employer may make matching
and Nonelective 

 

6

 

Employer contributions to your Account. 
The type(s) of contributions available under the Plan are described in
this section.

I.                                         Compensation

Compensation must be defined to compute contributions under the
Plan.  Eligible compensation for
computing contributions under the Plan is the taxable compensation for a Plan
Year reportable by your Employer on your IRS Form W-2, excluding reimbursements
or other expense allowances, fringe benefits, moving expenses, deferred
compensation and welfare benefits and including salary reduction contributions
you made to an Employer sponsored cafeteria plan, 401(k) plan or 403(b)
program. In addition, compensation excludes:

 

Ÿ                    The taxable
value of a qualified or non-qualified stock option

 

 

Compensation for your first year of eligible Plan participation will be
based upon eligible compensation paid for the entire Plan Year.  Tax laws limit the amount of compensation
that may be taken into account each Plan Year; the maximum amount for the 2004
Plan Year is $205,000.00 and the maximum amount for the 2005 Plan Year is
$210,000.

 

II.                                     Employee Pretax
Contributions

 

1.              Regular Contributions

You may elect to contribute a percentage of your eligible compensation
into the Plan after you satisfy the Plan’s eligibility requirements.  The percentage you defer is subject to an
annual limit of the lesser of 90% of eligible compensation or $13,000 in a
calendar year (in 2004; for calendar years following 2002, legislation has
increased the deferral limit by $1,000 each year until it reaches $15,000 for
2006 and then thereafter as adjusted by the Secretary of the Treasury ).  Your pretax contributions cannot be forfeited
for any reason, however, there are special Internal Revenue Code rules which
must be satisfied and may require that some of your contributions be returned
to you.  The Plan Administrator will
notify you if any of your contributions will be returned.  You may increase or decrease the amount you
contribute as of the beginning of each payroll period.  You may completely suspend your contributions
on a prospective basis with sufficient notice to the Plan Administrator.  Thereafter, if you want to resume your Employee
pretax contributions as of Beginning of each Payroll Period, you must complete
a new election form.

 

2.              Age 50 or Over
Catch-up Contributions

 

The Plan provides that participants who are projected to be age 50 or
older by the end of the calendar year and who are making Deferral Contributions
to the Plan may also make a catch-up contribution of up to $1,000 in 2002,
increasing by $1,000 each year until reaching $5,000 in 2006, when such amount
will be indexed in $500 increments.  You do not need to make a special election if
you are eligible for catch-up contributions; in general, any pretax
contributions you make above the plan limit or IRS limit on deferrals will be
treated as a catch-up contribution.

 

III.                                 Employer Matching
Contributions

All matching contributions
will be computed by your Employer based on your compensation contributed to the
plan each Plan Year.  You become eligible
for matching contributions only if you make Employee pretax contributions.  Matching contributions will not be made on any
catch-up contributions.

7

1.              Discretionary
Matching Contributions

Each Plan Year your Employer may make discretionary matching
contributions of a percent, if any, to be determined in the plan year based on a
percentage of your Employee pretax contributions.  Your Employer will communicate the amount of
any annual discretionary matching contributions. All matching contributions
will be computed by your Employer based on your compensation contributed to the
Plan Year. Employer matching contributions must be allocated to your Account in
the Plan within prescribed legal time limits.

IV.                                Nonelective
Employer Contributions

 

1.              Discretionary
Nonelective Employer Contributions

Your Employer may make annual discretionary Nonelective Employer
contributions in an amount to be determined at Plan Year end by the Board of
Directors.     Nonelective Employer
contributions, if any, made to the Plan by your Employer will be allocated to your
Account in the ratio that your eligible compensation bears to the total
eligible compensation paid to all eligible Participants.

2.              Qualified
Nonelective Contributions

Your Employer may designate all or a portion of any Nonelective
Employer contributions for a Plan Year as “qualified nonelective contributions”
and allocate them to Non-Highly Compensated Employees to help the Plan pass one
or more annually required Internal Revenue Code nondiscrimination test(s).  Any such contributions will be allocated to
eligible Participant Accounts as either a percentage of  eligible compensation or a flat dollar
amount.  You will be 100% vested in these
contributions and may not request a hardship withdrawal of these contributions.

 

V.            Limit on Contributions

 

Federal law requires that
amounts contributed by you and on your behalf by your Employer for a given
limitation year generally may not exceed the lesser of:

•        $41,000 (or such amount as may be
prescribed by the Secretary of the Treasury); or

•        100% of your annual compensation.

The limitation year for purposes of applying the above limits is the
twelve month period ending December 31st. Contributions under this Plan may not
exceed the above limits.  If this does
occur then excess contributions in your Account may be forfeited or refunded to
you based on the provisions of the Plan document.  You will be notified by the Plan
Administrator if you have any excess contributions and income tax consequences
may apply on the amount of any refund you receive.

 

VI.           Rollover Contributions

 

You can roll over part or all of an eligible rollover distribution you
received from a prior employer’s eligible retirement plan or an IRA. An
eligible retirement plan includes a qualified plan under Section 401(a) or
403(a), a 403(b) annuity contract, an eligible governmental 457(b) plan, or a
taxable distribution from an individual retirement account or individual
retirement annuity. You may also roll over qualified plan after-tax employee
contributions, provided such Rollover Contribution is made as a direct
rollover. Making Rollover Contributions to the Plan which consist of assets
other than qualified 401(a) plan assets may result in the loss of favorable
capital gains or ten year income averaging tax treatment associated with lump
sum distributions from your current Plan balance. If you may be eligible for
this special tax treatment, you should consult your tax advisor and carefully
consider the impact of making a Rollover Contribution to the Plan. The Plan
Administrator must approve any Rollover Contribution and reserves the right to
refuse to accept any such contribution. 
If your Rollover Contribution to the Plan is not a direct rollover (i.e. you received a cash distribution from
your prior employer’s plan or from your rollover IRA), then it must be received
by the Trustee within 60 days of your receipt of the distribution.  Rollover Contributions shall only 

 

8

 

be made in the form of cash or allowable mutual fund shares.  You
may make a rollover contribution to the Plan before becoming a
Participant.  However, you will not
become a Participant in the Plan and become entitled to make pretax
contributions and share in Employer contributions until you have met the Plan’s
eligibility and entry date requirements. 
Your Rollover Contributions account will be subject to the terms of this
Plan and will always be fully vested and nonforfeitable. In general, if you
receive an eligible rollover distribution as a surviving spouse of a
participant or as a spouse or former spouse who is an “alternate payee”
pursuant to a qualified domestic relations order (“QDRO”), you may also make a
Rollover Contribution to the Plan.

 

IV.           Investments

I.                                         Investments

 

You have the right to vote any mutual fund proxy based on the number of
shares you own.  If you want additional
information about any investment alternative, you may request any of the
following information by calling Fidelity at 1-800-294-4015:

 

•                  A description of the annual operating
expenses of each investment fund (e.g., investment management fees,
administrative fees, transaction costs) which reduce the rate of return to you,
and the aggregate amount of such expenses expressed as a percentage of average
net assets of the designated investment alternative;

 

•                  Prospectuses, financial statements and
reports, plus any other material available to the Plan which relates to the
available investment alternatives;

 

•                  A list of the assets comprising the
portfolio of each investment fund, the value of such assets (or the proportion
of the investment fund which it comprises), and with respect to each such asset
which is a fixed rate investment contract issued by a bank, savings and loan
association or insurance company, the name of the issuer of the contract, the
term of the contract and the rate of return on the contract;

 

•                  Information concerning the value of
shares or units of the investment funds available to Participants under the
Plan, as well as the past investment performance of such funds, determined net
of expenses, on a reasonable and consistent basis.

 

II.                                     Statement of Account

 

The assets in the Plan are invested in available investment options and
a separate Account is established for each Participant who receives a
contribution.  The value of your Account
is updated each business day to reflect any contributions, exchanges between
investment options, investment earnings or losses for each investment option
and withdrawals.  A quarterly statement
showing the value of your Account will generally be delivered to you within 15
business days after the following dates: February 28th, May 31st, August 31st,
November 30th.  You may also access the
activity in your Account through the Internet by using Fidelity’s
www.401kxpress.com website.  Please
contact the Plan Administrator for further information.

 

III.                                 404(c) Election

 

The Plan is intended to qualify as a participant-directed plan under
Section 404(c) of ERISA. This means that you are responsible for your
investment decisions under the plan. The plan fiduciaries, including Fidelity
Management Trust Company and Ciphergen Biosystems, Inc., are not responsible
for any losses incurred as a result of your investment decisions.

 

9

V.            Vesting

 

The term vesting refers
to your nonforfeitable right to the money in your Account.  You receive vesting credit for the number of
years that you have worked for your Employer. 
If you terminate your employment with your Employer, you may be able to
receive a portion or all of your Account based on your vested percentage.

 

You are always 100%
vested in your rollover contributions, Employee pretax contributions, qualified
nonelective contributions and any earnings thereon.  Your Matching Contributions, Nonelective
Employer contributions and any earnings thereon will be vested in accordance
with the following schedule:

 

	
  Years of Service for Vesting

  	
   

  	
  Vesting
  Percentage

  	
   

  
	
  less than 1

  	
   

  	
  0

  	
  %

  
	
  1

  	
   

  	
  33

  	
  %

  
	
  2

  	
   

  	
  66

  	
  %

  
	
  3

  	
   

  	
  100

  	
  %

  

 

 

The Plan has changed the
methodology used to determine your years of service.  Previously you received vesting credit for a
year of service under the ‘general method’ if you worked more than 1,000 hours
in a Plan Year.  Vesting under the Plan
is now based upon the elapsed time method. Hours of service are not counted and
instead periods of service are computed. 
A period of service is determined by the time you work for your
Employer.  Only your whole years of
service with your Employer will be counted to compute your years of service for
vesting purposes.  For example, if you
work three years and ten months then for vesting purposes you will receive
credit for three years of service.  If
you were hired before October 1, 2004 then you will receive vesting credit for
your years of service with your Employer based upon the following:

 

	
   

  	
   

  	
  Applicable Year(s)

  	
   

  	
  Method

  	
   

  	
  Measurement Period

  	
   

  
	
  1.

  	
   

  	
  Year(s) before 2004

  	
   

  	
  General

  	
   

  	
  Jan. 1 to Dec. 31

  	
   

  
	
  2.

  	
   

  	
  Jan. 1, 2004 to Dec. 31, 2004

  	
   

  	
  General or Elapsed Time*

  	
   

  	
  Jan. 1 to Dec. 31

  	
   

  
	
  3.

  	
   

  	
  Year(s) after Jan. 1, 2005

  	
   

  	
  Elapsed Time

  	
   

  	
  Jan. 1 to Dec. 31

  	
   

  

*   You
will receive credit for this year based upon whichever method is more favorable
to you.

 

If you were hired on or
after October 1, 2004 then you will receive vesting credit for your years of
service with your Employer based only on the elapsed time method.  In this case, your measurement period for
determining your years of service will generally be based upon your date of
employment with your Employer.

I.                                         Forfeiture and
Re-employment

 

If you terminate
your employment with your Employer and are less than 100% vested in your Employer
Account, you may forfeit the non-vested portion of your Employer Account.  A forfeiture will occur in the Plan Year that
you receive a distribution of your entire vested Account, or if you do not
receive a distribution, after five consecutive one year breaks in service.  Forfeitures are retained in the Plan and will
first be used to pay administrative expenses under the Plan, as directed by the
Employer.  Any remaining amounts will be
used to reduce future Employer contributions payable under the Plan.

 

Example:  (This example is for illustration purposes
only.)  Assuming your vesting schedule is
as follows:

	
  Years of Service

  	
   

  	
  Vesting Percentage

  	
   

  
	
  less than 2

  	
   

  	
  0

  	
  %

  
	
  2

  	
   

  	
  20

  	
  %

  
	
  3

  	
   

  	
  40

  	
  %

  
	
  4

  	
   

  	
  60

  	
  %

  
	
  5

  	
   

  	
  80

  	
  %

  
	
  6

  	
   

  	
  100

  	
  %

  

You terminate your
employment in 2005 with five years
of service and the following Account:

 

10

 

	
  Source

  	
   

  	
  Amount

  	
   

  	
  Vested Percentage

  	
   

  	
  Vested Amount

  	
   

  
	
  Employee

  	
   

  	
  $

  	
  2,000

  	
   

  	
  100

  	
  %†

  	
  $

  	
  2,000

  	
   

  
	
  Employer

  	
   

  	
  $

  	
  1,000

  	
   

  	
  80

  	
  %

  	
  800

  	
   

  
	
  Total

  	
   

  	
  $

  	
  3,000

  	
   

  	
   

  	
   

  	
  $

  	
   2,800

  	
   

  

 

You received a
$2,800 distribution in 2005 from
the Plan.  This represented a complete
distribution of your Account.  A $200
forfeiture will occur in 2005.

† You are always 100% vested in your own employee
pretax contributions and earnings in the Plan.

 

A one-year break in service occurs when you have less than one hour of
service in the twelve consecutive month period beginning with the earlier of
the day your employment terminates or the 12 month anniversary of the date on
which you are otherwise first absent from service.  Notwithstanding the above, if you are absent
from work due to a maternity or paternity leave, then the 12-consecutive month
period beginning on the first anniversary of the first date of that absence
will not be a one-year break in service, and if you are absent from work due to
a leave of absence under the Family and Medical Leave Act, no 12-consecutive
month period beginning on the first anniversary of the first date of that
absence, and subsequent anniversaries, during which the absence continues, will
be a one-year break in service, provided you return to work following the
leave.

 

When any period of absence is due to military service entitling you to
reemployment rights under federal law and you return to work at the Employer or
a Related Employer following that absence, there will be no break in service
and you will be credited with service for the entire period of that absence.

 

If you were a Participant when you terminated your employment and are
re-employed by your Employer, then you will again become a Participant on the
date you complete one hour of service. 
Your period of employment before you were rehired is referred to as your
pre-break service.  Your period of
employment after you were rehired is referred to as your post-break
service.  If you are re-employed after
incurring five consecutive one-year breaks in service then your post-break
service will not count in determining your vesting percentage in your pre-break
Account balance.  Your post-break service
will count in determining your vesting percentage in your pre-break Account
balance and any forfeited amounts will be restored to your Account if:

 

(1)                                  You are re-employed by your Employer
before you incur five consecutive one-year breaks in service, and

 

(2)                                  If you received distribution of your
vested Account, you repay the full amount of the distribution before the end of
the five-year period that begins on the date you are re-employed.

 

11

Example:  Assume you terminate employment with your
Employer in 2002 with an Account balance of $10,000, of which $6,000 is
vested.  You elect to receive a lump sum
distribution of your vested Account balance. 
The remainder, or $4,000, is forfeited in 2002. If you are rehired on
January 1, 2004 and repay the $6,000 distribution prior to January 1, 2009, the
$4,000 previously forfeited will be restored to your Account.  Additionally, your service after January 1,
2004 is counted towards vesting your pre-break Account balance of $10,000

VI.        Participant
Loans

I.                                         Loan Rules

 

Loans shall be made available to all qualifying Participants on a
reasonably equivalent basis.  However,
loans may not be made to an eligible Employee who makes a rollover contribution
and who has not satisfied the Plan’s age, service and entry date
requirements.  Loans are not considered
distributions and are not subject to federal or state income taxes, provided
they are repaid as required.  While you
do have to pay interest on your loan, both the principal and interest are
reinvested in your account.  Loans will
be based on the following procedures:

 

1.              Loan Application

If you have met the Plan’s eligibility and entry date requirements, you
may only apply for 1 loan each Plan Year. 
Loans will be allowed for any purpose. 
To apply for a loan, please contact the Fidelity Retirement Benefits
Line at 1-800-294-4015 between the hours of 8:30 AM (ET) and 8:00 PM (ET).  You will incur a set-up fee for your loan.

2.              Loan Amount

The minimum loan is $1,000 and the maximum amount is the lesser of
one-half of your vested Account balance or $50,000 reduced by the highest
outstanding loan balance in your Account during the prior twelve month
period.  All of your loans from plans
maintained by your Employer or a Related Employer will be considered for
purposes of determining the maximum amount of your loan.  Up to 50% of your vested Account balance may
be used as collateral for any loan.

3.              Number of Loans

You may only have one loan outstanding at any given time.  You may not refinance an existing loan or
obtain a second loan for the purpose of paying off the existing loan.

4.              Interest Rate

All loans shall bear a reasonable rate of interest as
determined by the Plan Administrator based on the prevailing interest rates
charged by persons in the business of lending money for loans which would be
made under similar circumstances.  The
interest rate shall remain fixed throughout the duration of the loan.

 

5.              Loan Repayments and
Loan Maturity

Loans from the Plan must be repaid in level payments generally through
after-tax payroll deductions on at least a quarterly basis over a period not to
exceed five years unless for the purchase of your principal residence in which
case the loan repayment period may not extend beyond ten years from the date of
the loan. If repayment is not made by payroll deduction, a loan shall be repaid
to the Plan by payment to the Employer. 
The level repayment requirement may be waived: 1) for a period of up to
one year if you are on an unpaid non-military leave of absence; or 2) if your
leave is because you are performing military service, for the entire length of
time missed on leave. Your loan will accrue interest during your leave, and
upon your return will be reamortized if: 1) the original loan was for a term of
less than five years or 2) if you return from a military leave of absence, in
which case your loan will be reamortized to extend the full length of the loan
by the length of the leave. If a loan is not repaid within its required
repayment period, it will be treated as a taxable distribution to you.

12

 

6.              Source of Loan Proceeds

Loan proceeds will be withdrawn from available contribution sources and
investment options in the order established by the Trustee.  You may only borrow from the following
contribution sources:

 

* Employee Deferral

* Rollover

* QNEC

* Discretionary Match

* Discretionary Profit Sharing

* After-Tax Rollover

 

Please contact the Plan Administrator for more information.

7.              Default or Termination
of Employment

The Plan Administrator shall consider a loan in default if any
scheduled repayment remains unpaid as of the last business day of the calendar
quarter following the calendar quarter in which a loan is initially considered
past due. In the event of a default, death, disability or termination of
employment, the entire outstanding principal and accrued interest shall be
immediately due and payable.  In
addition, you will be deemed to have received a taxable distribution from the
Plan

VII.                            In Service
Withdrawals

If you qualify and your request is approved by the Plan Administrator,
you may obtain a withdrawal from the Plan while you are still an Employee.  The following types of withdrawals are
available under the Plan:

I.                                                                 Hardship Withdrawals

If you are an Employee and request a hardship withdrawal, and it is
approved by the Plan Administrator, you may withdraw your employee pretax
contributions to satisfy any of the following immediate and heavy financial
needs: (1) medical expenses for you, your spouse, children or dependents; (2)
the purchase of your principal residence; (3) to prevent your eviction from or
foreclosure on your principal residence; or (4) to pay for post-secondary
education expenses (tuition, related educational fees, room and board) for you,
your spouse, children or dependents for the next twelve months; or any other
immediate and heavy financial need as determined based on Internal Revenue
Service regulations.  In accordance with
Internal Revenue Service regulations you must first exhaust all other assets
reasonably available to you prior to obtaining a hardship withdrawal.  This includes obtaining a loan from this Plan
and any other qualified plan maintained by your Employer. Your pretax
contributions to this Plan, and any other qualified or non-qualified plan, will
be suspended for six months after your receipt of the hardship withdrawal.  The minimum hardship withdrawal is $500.

II.                    Withdrawals After Age 59 1/2

If you have reached age 59 1/2 then you may elect to withdraw all or a
portion of your vested Account while you are still employed by your Employer.

III.                                                         Withdrawals After
Age 70 1/2

You are required to receive a minimum required distribution from the
Plan by April 1st of the later of the calendar year after you reach age 70 1/2
or the year you retire.  (If you are
considered a five percent owner of your Employer, you must receive your minimum
distribution by April 1st of the calendar year after you reach 70 1/2.)  You must then receive a certain amount of
your Account balance each Plan Year from the Plan.  The amount of your distribution is based on
several factors and you should contact the Plan Administrator for further
information.

 

13

 

IV.                   Withdrawals After Normal Retirement Age

 

You may elect to withdraw your vested Account balance after you reach
the Plan’s normal retirement age, 65, or delay it until you retire.
Notwithstanding the above, by law certain contributions including employee
pretax, qualified matching, matching, qualified nonelective, and nonelective
contributions cannot be withdrawn prior to age 59 1/2.

 

V.                    Withdrawals of Rollover Contributions

 

If you have a balance in your Rollover Contributions Account, you may
elect to withdraw all or a portion of it.

 

In-Service withdrawals will be withdrawn from available contribution
sources and investment options in the order established by the Plan
Administrator. Consult your Plan Administrator for more information. The amount
of any taxable withdrawal will be subject to Federal and state, if applicable,
income taxes. In general, the amount of any taxable withdrawal that qualifies
as an eligible rollover distribution and is not rolled over into an Individual
Retirement Account or another qualified employer retirement plan will be
subject to 20% Federal Income Tax withholding and any applicable State Income
Tax withholding. A 10% Internal Revenue Code early withdrawal penalty tax may
apply to the amount of your withdrawal if you are under the age of 59 1/2 and
do not meet one of the Internal Revenue Code exceptions.

 

Note: Certain transactions in your Account (for example, contributions,
distributions, and rollovers) may be treated differently for state tax purposes
than for federal tax purposes.  Please
consult with your Plan Administrator, tax advisor or Investment Professional as
appropriate.

 

The Plan Administrator
will notify you of the appropriate procedures to make a withdrawal from the
Plan.  The amount of any withdrawal will
be withdrawn from available investment options in the order established by the
Plan Administrator.  Consult your Plan
Administrator for more information.

VIII.                        Distribution
of Benefits

I.                                         Eligibility For Benefits

If you have not attained
the Plan’s normal retirement age, 65, you are eligible to request a
distribution of your vested Account balance. 
A distribution can only be made to you if you request one due to your
disability, retirement, or termination of employment from your Employer and any
Related Employer.  Your Beneficiary or
Beneficiaries may request a distribution of your vested Account balance in the
event of your death.

 

You may defer receipt of
your distribution until a later date. 
However you cannot postpone it if your vested Account balance is $5,000
or less in which case the Plan
Administrator may direct the Trustee to distribute it to you as a lump sum
distribution without your consent.  If
your vested Account balance exceeds $5,000, you may delay your distribution
until you are required by law to receive minimum required distributions.  You will have a continuing election to
request a distribution if you elect to postpone your distribution unless you
are re-employed by your Employer or any Related Employer.  The value of your Account balance will
continue to increase or decrease, as appropriate, based on the investment
returns until it is distributed.  Your
written consent will be required for any distribution if your vested Account
balance is greater than $5,000.

 

You should consult with
your tax advisor to determine the financial impact of your situation before you
request a distribution.  You may apply
for a distribution by calling the Fidelity Retirement Benefits Line at
1-800-294-4015 and/or by accessing the NetBenefitsSM web site at
www.401kxpress.com.  All telephone calls
will be recorded.  The approval of your
Plan Administrator will be required before any distribution can be completed.

 

14

 

II.                                     Distributable Events

You are eligible to
request a distribution of your vested Account balance based on any of the
following events:

1.              Death

If you are a Participant in the Plan and die, your vested Account
balance, if any, will be paid to your designated Beneficiary or
Beneficiaries.  If you are an Employee of
your Employer or a Related Employer at the time of your death, your Account
balance will automatically become 100% vested. 
You may designate a Beneficiary or Beneficiaries on a designation form
that must be properly signed and filed with the Plan Administrator.  If you are married and want to designate
someone other than your spouse as your primary Beneficiary, your spouse must
consent to this designation by signing the form.  His/her signature must be witnessed by a Plan
representative or a notary public.  You
should contact the Plan Administrator to obtain a designation of beneficiary
form.

2.              Disability

If you become disabled while you are employed by your
Employer or a Related Employer, so that 
you are determined disabled by a physician selected by the Plan
Administrator, the full value of your Account balance may be distributed to you
upon request.  You will automatically
become 100% vested in your Account balance when you become disabled.  You may request a distribution of your
Account balance only if you terminate your employment with your Employer or
Related Employer.

 

3.              Retirement

You do not have to terminate your employment with your
Employer just because you attain your normal retirement age of 65.  You will automatically become 100% vested in
your Account balance.  You may take an
in-service distribution from your vested Account balance once you attain your
normal retirement age of 65, even if you are still employed.

 

4.              Termination of
Employment

If you terminate your employment with your Employer
and any Related Employer, you may elect to receive a distribution of your
vested Account balance from the Plan.

 

III.                                 Form of Payments

The forms of payments that you may elect under the Plan are listed in
this section.

 

1.              Lump Sum Distributions

Your entire vested Account balance will be paid to you
in a single cash distribution or other distribution that you elect.

 

a)             Cash
Distribution

 

Any eligible rollover distribution paid directly to you will be subject
to mandatory Federal income tax withholding of 20% of the taxable distribution
and the remaining amount will be paid to you. 
You cannot elect out of this tax withholding but you can avoid it by
electing a direct rollover distribution as described below.  This withholding is not a penalty but a
prepayment of your Federal income taxes.

You may rollover the eligible taxable distribution you
receive to an individual retirement account (IRA) or your new employer’s plan,
if it accepts rollover contributions and you roll over this distribution within
60 days after receipt.  You will not be
taxed on any amounts timely rolled over into the IRA or your new employer’s
Plan until those amounts 

 

15

 

are later distributed to you.  Any amounts not rolled over may also be
subject to certain early withdrawal penalties prescribed under the Internal
Revenue Code.

 

b)             Direct
Rollover Distribution

 

As an alternative to a cash distribution paid directly
to you, you may request a rollover distribution of your entire eligible Account
balance directly into an Advisor Retirement Connection-IRA, a Non-Advisor
Retirement Connection-IRA, or to your new employer’s eligible plan if it
accepts rollover contributions or a 403(a) Annuity.  Federal income taxes will not be withheld on
any direct rollover distribution.

 

1.                                      Rollover to an Advisor Retirement
Connection IRA - You must complete the appropriate documentation and an Advisor
Retirement Connection IRA application. 
If your distribution is authorized by the Plan Administrator, it will be
forwarded to the Trustee for processing. 
Your vested Account balance will be directly rolled over to an Advisor
Retirement Connection IRA.

 

2.                                      Rollover to a Non-Advisor Retirement
Connection IRA - You must complete the appropriate documentation and indicate
the name and address of the trustee, and IRA account number.  If your distribution is authorized by the
Plan Administrator, it will be forwarded to the Trustee for processing and they
will issue a check payable to the IRA trustee or custodian for your
benefit.   The check will be mailed
directly to you and contain the notation “direct rollover” and you will be
responsible for forwarding it to the trustee or custodian of your IRA.

 

3.                                      Rollover to your New Employer’s
Retirement Plan - You should check with your new employer to determine if its
plan will accept rollover contributions. 
If allowed, you must complete the appropriate documentation and indicate
the name, address and plan number of your new employer’s retirement plan.  If your distribution is authorized by the Plan
Administrator, it will be forwarded to the Trustee for processing and they will
issue a check payable to the trustee of your new employer’s plan.  The check will contain the notation “direct
rollover” and will be mailed directly to you and you will be responsible for
forwarding it on to the new trustee.

 

4.                                    Rollover to a 403(a) Annuity - You must complete the
appropriate documentation and indicate the name and address of the trustee or
custodian, and 403(a) Annuity account number. 
If your distribution is authorized by the Plan Administrator, it will be
forwarded to the Trustee for processing and they will issue a check payable to
the 403(a) Annuity trustee or custodian for your benefit.   The check will be mailed directly to you and
contain the notation “direct rollover” and you will be responsible for
forwarding it to the trustee or custodian of your 403(a) Annuity.

 

c)             Combination Cash Distribution and Direct Rollover
Distributions

 

You may request that part of your distribution be paid directly to you
and the balance rolled into an IRA, your new employer’s retirement plan, or a
403(a) Annuity.  Any cash distribution
will be subject to the Federal income tax withholding rules referred to in 1a)
and any direct rollover distribution in accordance with 1b).  Your direct rollover distribution must be at
least $500.

You will pay income tax on the amount of any taxable
distribution you receive from the Plan unless it is rolled into an IRA or your
new employer’s plan.  A 10% IRS premature
distribution penalty tax may also apply to your taxable distribution if you are
under age 591⁄2 (or under age 55 and separated from service), unless it is rolled
into an IRA or 

 

16

 

another eligible plan. 
The 20% Federal income tax withheld under this section may not cover
your entire income tax liability.   In
the case of a combination distribution, if any portion of the eligible rollover
distribution is attributable to after-tax contributions, such contributions
will be considered to be withdrawn last for tax purposes. Consult with your tax
advisor for further details.

 

2.              Installment
Distributions

Your vested Account balance will be paid to you in substantially equal
amounts over a period of time.  You may
elect annual or more frequent installments. You may elect to receive a lump sum
distribution after you start to receive installment distributions, by
completing the appropriate documentation. 
The direct rollover distribution rules referred to in the lump sum
distribution section also apply to installment distributions.

IX.        Miscellaneous
Information

I.                                         Benefits Not Insured

Benefits provided by the
Plan are not insured or guaranteed by the Pension Benefit Guaranty Corporation
under Title IV of the Employee Retirement Income Security Act of 1974 because
the insurance provisions under ERISA are not applicable to this particular
Plan.  You will only be entitled to the
vested benefits in your Account based upon the provisions of the Plan and the
value of your Account will be subject to investment gains and losses.

II.                                     Attachment of Your
Account

Your Account may not be
attached, garnished, assigned or used as collateral for a loan outside of this
Plan except to the extent required by law. 
Your creditors may not attach, garnish or otherwise interfere with your
Account balance except in the case of a proper Internal Revenue Service tax
levy or a Qualified Domestic Relations Order (QDRO).  A QDRO is a special order issued by the court
in a divorce, child support or similar proceeding.  In this situation, your spouse, or former
spouse, or someone other than you or your Beneficiary, may be entitled to a
portion or all of your Account balance based on the court order.  Participants and Beneficiaries can obtain,
without a charge, a copy of QDRO procedures from the Plan Administrator.

III.                                 Plan-to-Plan
Transfer Of Assets

Your Employer may direct
the Trustee to transfer all or a portion of the assets in the Account of
designated Participants to another plan or plans maintained by your Employer or
other employers subject to certain restrictions.  The plan receiving the Trust Funds must
contain a provision allowing the transfer and preserve any benefits required to
be protected under existing laws and regulations.  In addition, a Participant’s vested Account
balance may not be decreased as a result of the transfer to another plan.

IV.                                Plan Amendment

Your Employer reserves
the authority to amend certain provisions of the Plan by taking the appropriate
action.   However, any amendment may not
eliminate certain forms of benefits under the Plan or reduce the existing
vested percentage of your Account balance derived from Employer
contributions.  If you have three or more
years of service with your Employer and a Related Employer and the vesting
schedule is amended then you will be given a choice to have the vested
percentage of future Employer contributions made to your Account computed under
the new or the old vesting schedule.  The
Plan Administrator will provide you with the appropriate information to make an
informed decision if the Plan’s vesting schedule is amended.

 

17

 

V.                                    Plan Termination

Your Employer has no
legal or contractual obligation to make annual contributions or to continue the
Plan.  Your Employer reserves the right
to terminate the Plan at any time by taking appropriate action as circumstances
may dictate, with the approval of the Board of Directors.  In the event the Plan should terminate, each
Participant affected by such termination shall have a vested interest in his
Account of 100%.  The Plan Administrator
will facilitate the distribution of Account balances in single lump sum
payments to each Participant in accordance with Plan provisions until all
assets have been distributed by the Trustee.

VI.           Interpretation of Plan

The Plan Administrator
has the power and discretionary authority to construe the terms of the Plan
based on the Plan document, existing laws and regulations and to determine all
questions that arise under it.  Such power
and authority include, for example, the administrative discretion necessary to
resolve issues with respect to an Employee’s eligibility for benefits, credited
services, disability, and retirement, or to interpret any other term contained
in Plan documents.  The Plan
Administrator’s interpretations and determinations are binding on all
Participants, Employees, former Employees, and their Beneficiaries.

VII.                            Electronic Delivery

This Summary Plan Description and other important Plan information may
be delivered to you through electronic means. 
This Summary Plan Description contains important information concerning
the rights and benefits of your Plan.  If
you receive this Summary Plan Description (or any other Plan information)
through electronic means you are entitled to request a paper copy of this
document, free of charge, from the Plan Administrator. The electronic version
of this document contains substantially the same style, format and content as
the paper version.

X.            Internal
Revenue Service Tests

 

I.                                         Non-Discrimination Tests

The Plan must pass
Internal Revenue Code non-discrimination tests as of the last day of each Plan
Year to maintain a qualified Plan.  These
tests are intended to ensure that the amount of contributions under the Plan do
not discriminate in favor of Highly Compensated Employees.  In order to meet the tests, your Employer
encourages participation from all eligible Employees.  Depending upon the results of the tests, the
Plan Administrator may have to refund 
pretax contributions contributed to the Plan and vested matching
contributions to certain Highly Compensated Employees, as determined under
Internal Revenue Service regulations. 
Pretax or matching contributions will be refunded to you from applicable
investment options.  You will be notified
by the Plan Administrator if any of your contributions will be refunded to you.

II.                                     Top Heavy Test

The Plan is
subject to the Internal Revenue Code “top-heavy” test.  Each Plan Year, the Plan Administrator tests
this Plan, together with any other Employer-sponsored qualified plans that
cover one or more key employees, to ensure that no more than 60% of the
benefits are for key employees.  If this
Plan is top-heavy, then your Employer may be required to make a minimum annual
contribution to this Plan, or another Employer sponsored plan, on behalf of
each non-key employee employed as of Plan Year-end.

 

18

XI.        Participant
Rights

I.                                         Claims

1.              Claims Procedures

You or your
Beneficiary has the right to make a claim for benefits you are entitled to
under the Plan.  You must submit any
claim to the Plan Administrator in a form and manner acceptable to the Plan
Administrator and it will be considered and subject to a full and fair review.
Generally, the Plan Administrator will provide you with written notice of the
disposition of your claim within 90 days after it has been filed, or, in
certain circumstances, within 180 days if special circumstances require an
extension of time to process the claim, and if written notice of such extension
and circumstances is given to you within the initial 90-day period.  In the event the claim is denied, the Plan
Administrator will disclose in writing to you the specific reasons for the denial,
the pertinent reference to the provisions of the Plan, a description of
additional material or information required to perfect the claim and why it is
required, and information about the steps that must be taken to submit a
request for review.  Contact your Plan
Administrator for more information.

If your claim
concerns disability benefits under the Plan, the Plan Administrator must notify
you in writing within 45 days after you have filed your claim in order to deny
it. If special circumstances require an extension of time to process your claim,
the Plan Administrator must notify you before the end of the 45-day period that
your claim may take up to 30 days longer to process. If special circumstances
still prevent the resolution of your claim, the Plan Administrator may then
only take up to another 30 days after giving you notice before the end of the
original 30-day extension. If the Plan Administrator gives you notice that you
need to provide additional information regarding your claim, you must do so
within 45 days of that notice.

2.              Review Procedures

You or your Beneficiary may generally appeal the denial of your claim
within 60 days after the date which you receive notification of a denied
claim.  If you wish further consideration
of your claim, you must file a written request for review with the Plan
Administrator and include any pertinent documentation.  You shall be provided, upon your request and
free of charge, reasonable access to, and copies of, all documents, records,
and other information relevant to your claim for benefits.

If your initial claim was for disability benefits under the Plan and
has been denied by the Plan Administrator, you have 180 days from the date you
receive notice of your denial in which to appeal that decision. Your review
will be handled completely independently of the findings and decision made
regarding your initial claim and will be processed by an individual who is not
a subordinate of the individual who denied your initial claim. If your claim
requires medical judgment, the individual handling your appeal will consult
with a medical professional who was not consulted regarding your initial claim
and who is not a subordinate of anyone consulted regarding your initial claim
and identify that medical professional to you.

The Plan Administrator shall make a decision on your claim and will
notify you in writing within a reasonable period of time, but not later than 60
days after receipt of your request for review, unless the Plan Administrator
determines that special circumstances require an extension of time for
processing the claim. If the Plan Administrator determines that an extension of
time for processing is required, written notice of the extension shall be
furnished to you prior to the termination of the initial 60-day period. In no
event shall such extension exceed a period of 60 days from the end of the
initial 60-day period. The extension notice shall indicate the special
circumstances requiring an extension of time and the date by which the Plan
expects to render the determination on review. 
The Plan Administrator shall provide you with written notification of
the benefit determination on review. In the case of an adverse determination,
the notification shall be set forth, in a manner calculated to be understood by
you —the specific reason or reasons for the adverse determinations, reference
to the specific plan provisions on which the benefit determination is based, a
statement that you are entitled to receive, upon your request 

 

19

 

and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant to your claim for benefits.

 

II.                                     Statement of ERISA Rights

As a Participant in the Plan, you are entitled to certain rights and
protections under ERISA.  ERISA provides
that all Plan Participants shall be entitled to:

 

Receive Information
About Your Plan and Benefits.

•                  Examine, without charge, at the Plan
Administrator’s office and at other specified locations, such as worksites and
union halls, all documents governing the Plan, including insurance contracts
and collective bargaining agreements, and a copy of the latest annual report
(Form 5500 Series)  filed by the Plan
with the U.S. Department of Labor and available at the Public Disclosure Room
of the Employee Benefits Security Administration.

 

•                  Obtain, upon written request to the Plan
Administrator, copies of documents governing the operation of the plan,
including insurance contracts and collective bargaining agreements, and copies
of the latest annual report (Form 5500 Series) and updated Summary Plan
Description.   The Plan Administrator may
make  a reasonable charge for the copies.

 

•                  Receive a summary of the Plan’s annual
financial report.  The Plan Administrator
is required by law to furnish  each
Participant with a copy of this Summary Annual Report each year.

 

•                  Obtain a statement telling you whether
you have a right to receive a benefit under the plan at normal retirement age
(65) and if so, what your benefits would be at normal retirement age if you
stop working under the Plan now.  If you
do not have a right to a benefit under the plan, the statement will tell you
how many more years you have to work to get a right to a benefit.  This statement must be requested in writing
and is not required to be given more than once every twelve (12) months.  The Plan must provide the statement free of
charge.

 

Prudent Actions by Fiduciaries.

In addition to creating rights for Plan Participants,
ERISA imposes duties upon the people who are responsible for the operation of
the employee benefit plan.  The people
who operate your Plan, called “fiduciaries” of the Plan,  have a duty to do so prudently and in the
interest of you, other Plan Participants and Beneficiaries.  No one, including your Employer, your union,
or any other person, may fire you or otherwise discriminate against you in any
way to prevent you from obtaining a retirement benefit or exercising your
rights under ERISA.

 

Enforce Your Rights.

If your claim for a benefit under the Plan is denied or ignored, in whole
or in part, you have a right to know why this was done, to obtain copies of
documents relating to the decision without charge, and to appeal any denial,
all within certain time schedules. Under ERISA, there are steps you can take to
enforce the above rights.  For instance,
if you request a copy of plan documents or the latest annual report  from the Plan and do not receive them within
30 days, you may file suit in a federal court. The Plan’s agent for legal
service of process in the event of a lawsuit is the Plan Administrator.  In such a case, the court may require the
Plan Administrator to provide the materials and pay you up to $110 a day until
you receive the materials, unless the materials were not sent because of
reasons beyond the control of the Plan Administrator.

 

If you have a claim for benefits, which is denied or ignored, in whole
or in part, you may file suit in a state or Federal court.  In addition, if you disagree with the Plan’s
decision or lack thereof concerning the qualified status of a domestic
relations order, you may file suit in Federal court. If it should happen that
Plan fiduciaries misuse the Plan’s money, or if you are discriminated against
for asserting your rights, you may seek assistance from the U.S. Department of
Labor, or you may file suit in a federal court. The court 

 

20

 

will decide who should pay court costs and legal fees. If you are
successful, the court may order the person you have sued to pay these costs and
fees.  If you lose, the court may order
you to pay these costs and fees, for example, if it finds your claim frivolous.

 

Assistance with
Your Questions.

If you have any questions about your Plan, you should contact the Plan
Administrator.  If you have any questions
about this statement or your rights under ERISA, or if you need assistance in
obtaining documents from the Plan Administrator, you should contact the nearest
office of the Employee Benefits Security Administration, U.S. Department of
Labor, listed in your telephone directory or the Division of Technical
Assistance and Inquiries, Employee Benefits Security Administration, U.S.
Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You
may also obtain certain publications about your rights and responsibilities
under ERISA by calling the publications hotline of the Employee Benefits
Security Administration.

 

XII.                            Services
and Fees

Fees and expenses charged under your Account will impact your
retirement savings, and fall into three basic categories.  Investment
fees are generally assessed as a percentage of assets invested, and
are deducted directly from your investment returns.  Investment fees can be in the form of sales
charges, loads, commissions, 12b-1 fees, or management fees. You can obtain
more information about such fees from the documents (e.g., a prospectus) that
describe the investments available under your Plan.  Plan
administration fees cover the day-to-day expenses of your Plan for
recordkeeping, accounting, legal and trustee services, as well as additional
services that may be available under your Plan, such as daily valuation,
telephone response systems, internet access to plan information, retirement
planning tools, and educational materials or fees for the selection of non-Fidelity
funds.  In some cases, these costs are
covered by investment fees that are deducted directly from investment
returns.  In other cases, these
administrative fees are either paid directly by your Employer, or are passed
through to the participants in the Plan, in which case a recordkeeping fee will
be deducted from your Account.  Transaction-based fees are associated with
optional services offered under your Plan, and are charged directly to your
Account if you take advantage of a particular plan feature that may be
available, such as a Plan loan.  For more
information on fees associated with your Account, refer to your quarterly
Account statement, or speak with your Plan Administrator.  In addition, under certain circumstances, a
portion of these fees may be paid by the Investment Professional as directed by
your Employer.

 

21

 

XIII.        Appendix A:
Investment Options

You have the
opportunity to direct the investments of your Account among the following investment
options:

 

	
  Name

  	
   

  	
  Code

  	
   

  	
  Investment
  Objective

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Morgan Stanley
  Liquid Assets

  	
  OQHH

  	
  Seeks high
  current income, preservation of capital and liquidity.

  
	
  Morgan Stanley
  Stable Value Fund - Class A

  	
  OBPN

  	
  Seeks to provide
  safety of principal and a competitive rate of interest that changes daily.

  
	
  Fidelity Advisor
  Mortgage Securities Fund - Class T

  	
  0239

  	
  Seeks to provide
  a high level of current income.

  
	
  Fidelity Advisor
  High Income Advantage Fund - Class T

  	
  0165

  	
  Seeks to provide
  a combination of a high level of income and the potential for capital gains.

  
	
  Van Kampen
  Equity-Income Fund - Class A

  	
  OQCZ

  	
  Seeks to provide
  the highest possible income consistent with safety of principal. Long-term
  growth of capital is an important secondary objective.

  
	
  Fidelity Advisor
  Cyclical Industries Fund - Class T

  	
  0194

  	
  Seeks capital
  appreciation.

  
	
  Evergreen
  Special Values Fund - Class A

  	
  OQWO

  	
  The fund seeks
  to produce growth of capital.

  
	
  Morgan Stanley
  Equally-Weighted S&P 500 Fund

  	
  OQEQ

  	
  Seeks a high
  level of total return on assets through a combination of capital appreciation
  and current income.

  
	
  Fidelity Advisor
  Leveraged Company Stock Fund - Class T

  	
  0105

  	
  Seeks to provide
  capital appreciation.

  
	
  Evergreen Small
  Cap Value  A

  	
  OQXT

  	
  The fund seeks
  long-term growth of capital.

  
	
  Fidelity Advisor
  Equity Growth Fund - Class T

  	
  0286

  	
  Seeks to provide
  capital appreciation.

  
	
  Oppenheimer
  Capital Appreciation Fund - Class A

  	
  OQDH

  	
  Seeks to provide
  long-term capital growth.

  
	
  AIM Capital
  Development Fund - Class A

  	
  OQFF

  	
  Seeks capital
  growth by following a long-term strategy focused on small and medium-sized
  companies.

  
	
  Van Kampen
  Global Franchise Fund - Class A

  	
  OQGU

  	
  Seeks long-term
  capital appreciation.

  
	
  Fidelity Advisor
  Diversified International Fund - Class T

  	
  0735

  	
  Seeks capital
  growth.

  
	
  Fidelity Advisor
  Freedom 2010 Fund - Class T

  	
  1187

  	
  Seeks to provide
  high total return with a secondary objective of principal preservation as the
  fund approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2020 Fund - Class T

  	
  1192

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2030 Fund - Class T

  	
  1197

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2040 Fund - Class T

  	
  1203

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom Income Fund - Class T

  	
  1208

  	
  Seeks high
  current income with a secondary objective of principal preservation.

  

 

22

 

	
  Fidelity Advisor
  Freedom 2005 Fund - Class T

  	
  1294

  	
  Seeks to provide
  high total return with a secondary objective of principal preservation as the
  fund approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2015 Fund - Class T

  	
  1299

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2025 Fund - Class T

  	
  1305

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  
	
  Fidelity Advisor
  Freedom 2035 Fund - Class T

  	
  1310

  	
  Seeks high total
  return with a secondary objective of principal preservation as the fund
  approaches its target date and beyond.

  

 

If a contribution is
received for your Account and you have not supplied investment instructions to
the Trustee, this contribution will be invested based on Employer direction, or
absent such direction, in the most conservative investment option designated by
the Employer in the Plan.

 

You may redirect
the investment of your future contributions or exchange your existing Account
balance among available investment options by calling 1-800-294-4015 on any
business day between 8:30 AM (ET) and 8:00 PM (ET).  This is an automated telephone service and
you should follow the telephonic instructions or you can press the appropriate
number if you want to talk to a Fidelity telephone representative.  All representative-assisted calls will be
recorded for your protection.  You may
call the telephone number virtually 24 hours a day, seven days a week to check
Account balances, prices, yields or obtain investment information.  You may also use the Internet to redirect the
investment or your future contributions or exchange your existing Account
balance by using Fidelity’s NetBenefits. 
Please contact the Plan Administrator for further information.

 

23

XIV.        Appendix B:
Special Tax Notice Regarding Plan Payments

 

This notice explains how you can continue to defer federal income tax
on your retirement savings or retirement Plan benefits in the Ciphergen
Biosystems Inc. 401(k) Plan (the “Plan”) and contains important information you
will need before you decide how to receive your Plan benefits.

 

This notice is provided to you at the request of the Plan Administrator
(“the Plan Administrator”) because all or part of the payment that you will
soon receive from the Plan may be eligible for rollover by you or your Plan
Administrator to a traditional IRA or an eligible employer plan. A rollover is
a payment by you or the Plan Administrator of all or part of your benefit to
another plan or IRA that allows you to continue to postpone taxation of that
benefit until it is paid to you. Your payment cannot be rolled over to a Roth
IRA, a SIMPLE IRA, or a Coverdell Education Savings Account (formerly known as
an education IRA). An “eligible employer plan” includes a plan qualified under
section 401(a) of the Internal Revenue Code, including a 401(k) plan,
profit-sharing plan, defined benefit plan, stock bonus plan, and money purchase
plan; a section 403(a) annuity plan; a section 403(b) tax-sheltered annuity;
and an eligible section 457(b) plan maintained by a governmental employer
(governmental 457 plan).

 

An eligible employer plan is not legally required to accept a rollover.
Before you decide to roll over your payment to another employer plan, you should
find out whether the plan accepts rollovers and, if so, the types of
distributions it accepts as a rollover. You should also find out about any
documents that are required to be completed before the receiving plan will
accept a rollover. Even if a plan accepts rollovers, it might not accept
rollovers of certain types of distributions, such as after-tax amounts. If this
is the case, and your distribution includes after-tax amounts, you may wish
instead to roll your distribution over to a traditional IRA or split your
rollover amount between the employer plan in which you will participate and a
traditional IRA. If an employer plan accepts your rollover, the plan may
restrict subsequent distributions of the rollover amount or may require your
spouse’s consent for any subsequent distribution. A subsequent distribution
from the plan that accepts your rollover may also be subject to different tax
treatment than distributions from this Plan. Check with the administrator of
the plan that is to receive your rollover prior to making the rollover.

 

If you have additional questions after reading this notice, you can
contact your Plan Administrator.

 

SUMMARY

 

There are two ways you may be able to receive a Plan payment that is
eligible for rollover:

 

(1) Certain payments can
be made directly to a traditional IRA that you establish or to an eligible
employer plan that will accept it and hold it for your benefit (“DIRECT
ROLLOVER”); or

 

(2) The payment can be PAID TO YOU.

 

If you choose a DIRECT ROLLOVER:

 

•  Your payment will not be taxed in the current
year and no income tax will be withheld.

 

•  You choose whether your payment will be made directly
to your traditional IRA or to an eligible employer plan that accepts your
rollover. Your payment cannot be rolled over to a Roth IRA, a SIMPLE IRA, or a
Coverdell Education Savings Account because these are not traditional IRAs.

 

•  The taxable portion of your payment will be taxed
later when you take it out of the traditional IRA or the eligible employer
plan. Depending on the type of plan, the later distribution may be subject to
different tax treatment than it would be if you received a taxable distribution
from this Plan.

 

If you choose to have a Plan payment that is eligible for rollover PAID TO YOU:

 

•  You will receive only 80% of the taxable amount of the
payment, because the Plan Administrator is required to withhold 20% of that
amount and send it to the IRS as income tax withholding to be credited against
your taxes.

 

•  The taxable amount of your payment will be taxed in the
current year unless you roll it over. Under limited circumstances, you may be
able to use special tax rules that could reduce the tax you owe. However, if
you receive the payment before age 591⁄2, you may have to pay an additional 10%
tax.

 

•  You can roll over all or part of the payment by paying
it to your traditional IRA or to an eligible employer plan that accepts your
rollover within 60 days after you receive the payment. The amount rolled over
will not be taxed until you take it out of the traditional IRA or the eligible
employer plan.

 

•  If you want to roll over 100% of the payment to a
traditional IRA or an eligible employer plan, you must find other money to
replace the 20% of the taxable portion that was withheld. If you roll over
only the 80% that you received, you will be taxed on the 20% that was withheld
and that is not rolled over.

 

Your Right to Waive
the 30-Day Notice Period. Generally, neither a direct rollover nor a payment
can be made from the plan until at least 30 days after your receipt of this
notice. Thus, after receiving this notice, you have at least 30 days to
consider whether or not to have your withdrawal directly rolled over. If you do
not wish to wait until this 30-day notice period ends before your election is
processed, you may waive the notice period by making an affirmative election
indicating whether or not you wish to make a direct rollover. Your withdrawal
will then be processed in accordance with your election as soon as practical
after it is received by the Plan Administrator.

 

24

 

MORE
INFORMATION

 

I.              PAYMENTS
THAT CAN & CANNOT BE ROLLED OVER

II.            DIRECT
ROLLOVER

III.           PAYMENT
PAID TO YOU

IV.           SURVIVING
SPOUSES, ALTERNATE PAYEES & OTHER BENEFICIARIES

 

I.
PAYMENTS THAT CAN AND CANNOT BE ROLLED OVER

 

Payments from the Plan may be “eligible rollover distributions.” This
means that they can be rolled over to a traditional IRA or to an eligible
employer plan that accepts rollovers. Payments from a plan cannot be rolled
over to a Roth IRA, a SIMPLE IRA, or a Coverdell Education Savings Account.
Your Plan Administrator should be able to tell you what portion of your payment
is an eligible rollover distribution.

 

After-tax
Contributions.
If you made after-tax contributions to the Plan, these contributions may be
rolled into either a traditional IRA or to certain employer plans that accept
rollovers of the after-tax contributions. The following rules apply:

 

25

 

a)   Rollover into a Traditional IRA. You can roll over your after-tax
contributions to a traditional IRA either directly or indirectly. Your Plan
Administrator should be able to tell you how much of your payment is the
taxable portion and how much is the after-tax portion.

 

If you roll over
after-tax contributions to a traditional IRA, it is your responsibility to keep
track of, and report to the Service on the applicable forms, the amount of
these after-tax contributions. This will enable the nontaxable amount of any
future distributions from the traditional IRA to be determined.

 

Once you roll over your
after-tax contributions to a traditional IRA, those amounts CANNOT later be
rolled over to an employer plan.

 

b)  Rollover into an Employer Plan. You can roll over after-tax
contributions from an employer plan that is qualified under Code section 401(a)
or a section 403(a) annuity plan to another such plan using a direct rollover
if the other plan provides separate accounting for amounts rolled over,
including separate accounting for the after-tax employee contributions and
earnings on those contributions. You can also roll over after-tax contributions
from a section 403(b) tax-sheltered annuity to another section 403(b)
tax-sheltered annuity using a direct rollover if the other tax-sheltered
annuity provides separate accounting for amounts rolled over, including
separate accounting for the after-tax employee contributions and earnings on
those contributions. You CANNOT roll over after-tax contributions to a
governmental 457 plan. If you want to roll over your after-tax contributions to
an employer plan that accepts these rollovers, you cannot have the after-tax
contributions paid to you first. You must instruct the Plan Administrator of
this Plan to make a direct rollover on your behalf. Also, you cannot first roll
over after-tax contributions to a traditional IRA and then roll over that
amount into an employer plan.

 

The following types of payments cannot be rolled over:

 

Payments Spread over Long Periods. You cannot roll over a payment if it is
part of a series of equal (or almost equal) payments that are made at least
once a year and that will last for:

 

•   your lifetime (or a period measured by your life
expectancy), or

•   your lifetime and your beneficiary’s lifetime (or a
period measured by your joint life expectancies), or

•   a period of 10 years or more.

 

Required Minimum Payments. Beginning when you reach age 701⁄2 or
retire, whichever is later, a certain portion of your payment cannot be rolled
over because it is a “required minimum payment” that must be paid to you.
Special rules apply if you own more than 5% of your employer.

 

Hardship Distributions. A hardship distribution cannot be rolled over.

 

ESOP Dividends. Cash dividends paid to you on employer stock held in
an employee stock ownership plan cannot be rolled over.

 

Corrective Distributions. A distribution that is made to correct a failed
nondiscrimination test or because legal limits on certain contributions were
exceeded cannot be rolled over.

 

Loans Treated as Distributions. The amount of a plan loan that becomes a
taxable deemed distribution because of a default cannot be rolled over.
However, a loan offset amount is eligible for rollover, as discussed in Part
III below. Ask the Plan Administrator of this Plan if distribution of your loan
qualifies for rollover treatment.

 

26

 

The Plan Administrator of this Plan should be able to tell you if your
payment includes amounts which cannot be rolled over.

 

II. DIRECT
ROLLOVER

 

A DIRECT ROLLOVER is a direct payment of the amount of your Plan
benefits to a traditional IRA or an eligible employer plan that will accept it.
You can choose a DIRECT ROLLOVER of all or any portion of your payment that is
an eligible rollover distribution, as described in Part I above. You are not
taxed on any taxable portion of your payment for which you choose a DIRECT
ROLLOVER until you later take it out of the traditional IRA or eligible
employer plan. In addition, no income tax withholding is required for any taxable
portion of your Plan benefits for which you choose a DIRECT ROLLOVER. This Plan
might not let you choose a DIRECT ROLLOVER if your distributions for the year
are less than $200.

 

DIRECT ROLLOVER to
a Traditional IRA. You can open a traditional IRA to receive the direct rollover. If you
choose to have your payment made directly to a traditional IRA, contact an IRA
sponsor (usually a financial institution) to find out how to have your payment
made in a direct rollover to a traditional IRA at that institution. If you are
unsure of how to invest your money, you can temporarily establish a traditional
IRA to receive the payment. However, in choosing a traditional IRA, you may
wish to make sure that the traditional IRA you choose will allow you to move
all or a part of your payment to another traditional IRA at a later date,
without penalties or other limitations. See IRS
Publication 590, Individual Retirement
Arrangements, for more information on traditional IRAs
(including limits on how often you can roll over between IRAs).

 

DIRECT ROLLOVER to
a Plan.
If you are employed by a new employer that has an eligible employer plan, and
you want a direct rollover to that plan, ask the plan administrator of that
plan whether it will accept your rollover. An eligible employer plan is not
legally required to accept a rollover. Even if your new employer’s plan does
not accept a rollover, you can choose a DIRECT ROLLOVER to a traditional IRA.
If the employer plan accepts your rollover, the plan may provide restrictions
on the circumstances under which you may later receive a distribution of the
rollover amount or may require spousal consent to any subsequent distribution.
Check with the plan administrator of that plan before making your decision.

 

DIRECT ROLLOVER of
a Series of Payments. If you receive a payment that can be rolled over to a traditional IRA
or an eligible employer plan that will accept it, and it is paid in a series of
payments for less than 10 years, your choice to make or not make a DIRECT
ROLLOVER for a payment will apply to all later payments in the series until you
change your election. You are free to change your election for any later
payment in the series.

 

Change in Tax
Treatment Resulting from a DIRECT ROLLOVER. The tax treatment of any payment from the eligible
employer plan or traditional IRA receiving your DIRECT ROLLOVER might be
different than if you received your benefit in a taxable distribution directly
from the Plan. For example, if you were born before January 1, 1936, you might
be entitled to ten-year averaging or capital gain treatment, as explained
below. However, if you have your benefit rolled over to a section 403(b)
tax-sheltered annuity, a governmental 457 plan, or a traditional IRA in a
DIRECT ROLLOVER, your benefit will no longer be eligible for that special
treatment. See the sections below entitled “Additional 10% Tax if You Are under
Age 591⁄2” and “Special Tax Treatment if You Were Born before January 1, 1936.”

 

III. PAYMENT
PAID TO YOU

 

If your payment can be rolled over (see Part I above) and the payment
is made to you in cash, it is subject to 20% federal income tax withholding on
the taxable portion (state tax withholding may also apply). The payment is
taxed in the year you receive it unless, within 60 days, you roll it over to a
traditional IRA or an eligible employer plan that accepts rollovers. If you do
not roll it over, special tax rules may apply.

 

 

27

 

Income Tax
Withholding:

 

Mandatory Withholding. If any portion of your payment can be
rolled over under Part I above and you do not elect to make a DIRECT ROLLOVER,
the Plan is required by law to withhold 20% of the taxable amount. This amount
is sent to the IRS as federal income tax withholding. For example, if you can
roll over a taxable payment of $10,000, only $8,000 will be paid to you because
the Plan must withhold $2,000 as income tax. However, when you prepare your
income tax return for the year, unless you make a rollover within 60 days (see “Sixty-Day
Rollover Option” below), you must report the full $10,000 as a taxable payment
from the Plan. You must report the $2,000 as tax withheld, and it will be
credited against any income tax you owe for the year. There will be no income
tax withholding if your payments for the year are less than $200.

 

Voluntary Withholding. If any portion of your payment is taxable but cannot
be rolled over under Part I above, the mandatory withholding rules described
above do not apply. In this case, you may elect not to have withholding apply to
that portion. If you do nothing, an amount will be taken out of this portion of
your payment for federal income tax withholding. To elect out of withholding,
ask the Plan Administrator for the election form and related information.

 

Sixty-Day Rollover Option. If you receive a payment that can be
rolled over under Part I above, you can still decide to roll over all or part
of it to a traditional IRA or to an eligible employer plan that accepts
rollovers. If you decide to roll over, you must contribute the amount of the
payment you received to a traditional IRA or eligible employer plan within 60
days after you receive the payment. The portion of your payment that is
rolled over will not be taxed until you take it out of the traditional IRA or
the eligible employer plan.

 

You can roll over up to 100% of your payment that can
be rolled over under Part I above, including an amount equal to the 20% of the
taxable portion that was withheld. If you choose to roll over 100%, you must
find other money within the 60-day period to contribute to the traditional IRA
or the eligible employer plan, to replace the 20% that was withheld. On the
other hand, if you roll over only the 80% of the taxable portion that you
received, you will be taxed on the 20% that was withheld.

 

Example:  
The taxable portion of your payment that can be rolled over under Part I
above is $10,000, and you choose to have it paid to you. You will receive
$8,000, and $2,000 will be sent to
the IRS as income tax withholding. Within 60 days after receiving the $8,000,
you may roll over the entire $10,000 to a traditional IRA or an eligible
employer plan. To do this, you roll over the $8,000 you received from the Plan,
and you will have to find $2,000 from other sources (your savings, a loan,
etc.). In this case, the entire $10,000 is not taxed until you take it out of
the traditional IRA or an eligible employer plan. If you roll over the entire
$10,000, when you file your income tax return you may get a refund of part or
all of the $2,000 withheld.

 

If, on the other hand, you roll over only $8,000, the
$2,000 you did not roll over is taxed in the year it was withheld. When you
file your income tax return, you may get a refund of part of the $2,000
withheld. (However, any refund is likely to be larger if you roll over the
entire $10,000.)

 

Additional 10% Tax If You Are under Age 591⁄2. If you receive a payment before you
reach age 591⁄2 and you do not roll it over, then, in addition to the regular
income tax, you may have to pay an extra tax equal to 10% of the taxable
portion of the payment. The additional 10% tax generally does not apply to (1)
payments that are paid after you separate from service with your employer
during or after the year you reach age 55, (2) payments that are paid because
you retire due to disability, (3) payments that are paid as equal (or almost
equal) payments over your life or life expectancy (or your and your beneficiary’s
lives or life expectancies), (4) dividends paid with respect to stock by an
employee stock ownership plan (ESOP) as described in Code section 404(k), (5)
payments that are paid directly to the government to satisfy a federal tax
levy, (6) payments that are paid to an alternate payee under a qualified
domestic relations order, or (7) payments that do not exceed the amount of your
deductible medical expenses. See IRS Form
5329 for more information on the additional 10% tax.

 

28

 

The additional 10% tax will not apply to distributions
from a governmental 457 plan, except to the extent the distribution is
attributable to an amount you rolled over to that plan (adjusted for investment
returns) from another type of eligible employer plan or IRA. Any amount rolled
over from a governmental 457 plan to another type of eligible employer plan or
to a traditional IRA will become subject to the additional 10% tax if it is
distributed to you before you reach age 591⁄2, unless one of the exceptions
applies.

 

Special Tax Treatment If You Were Born before January 1,
1936.
If you receive a payment from a plan qualified under section 401(a) or a
section 403(a) annuity plan that can be rolled over under Part I and you do not
roll it over to a traditional IRA or an eligible employer plan, the payment
will be taxed in the year you receive it. However, if the payment qualifies as
a “lump sum distribution,” it may be eligible for special tax treatment. (See
also “Employer Stock or Securities”, below.) A lump sum distribution is a
payment, within one year, of your entire balance under the Plan (and certain
other similar plans of the employer) that is payable to you after you have
reached age 591⁄2 or because you have separated from service with your employer
(or, in the case of a self-employed individual, after you have reached age 591⁄2
or have become disabled). For a payment to be treated as a lump sum
distribution, you must have been a participant in the plan for at least five
years before the year in which you received the distribution. The special tax
treatment for lump sum distributions that may be available to you is described
below.

 

Ten-Year
Averaging. If you
receive a lump sum distribution and you were born before January 1, 1936, you
can make a one-time election to figure the tax on the payment by using “10-year
averaging” (using 1986 tax rates). Ten-year averaging often reduces the tax you
owe.

 

Capital
Gain Treatment.
If you receive a lump sum distribution and you were born before January 1,
1936, and you were a participant in the Plan before 1974, you may elect to have
the part of your payment that is attributable to your pre-1974 participation in
the Plan taxed as long-term capital gain at a rate of 20%.

 

There are other limits on the special tax treatment
for lump sum distributions. For example, you can generally elect this special
tax treatment only once in your lifetime, and the election applies to all lump
sum distributions that you receive in that same year. You may not elect this
special tax treatment if you rolled amounts into this Plan from a 403(b)
tax-sheltered annuity contract, a governmental 457 plan, or from an IRA not
originally attributable to a qualified employer plan. If you have previously
rolled over a distribution from this Plan (or certain other similar plans of
the employer), you cannot use this special averaging treatment for later
payments from the Plan. If you roll over your payment to a traditional IRA,
governmental 457 plan, or 403(b) tax-sheltered annuity, you will not be able to
use special tax treatment for later payments from that IRA, plan, or annuity.
Also, if you roll over only a portion of your payment to a traditional IRA,
governmental 457 plan, or 403(b) tax-sheltered annuity, this special tax
treatment is not available for the rest of the payment. See IRS Form 4972 for additional information on
lump sum distributions and how you elect the special tax treatment.

 

Employer Stock or Securities. There is a special rule for a payment
from the Plan that includes employer stock (or other employer securities). To
use this special rule, 1) the payment must qualify as a lump sum distribution,
as described above, except that you do not need five years of plan
participation, or 2) the employer stock included in the payment must be
attributable to “after-tax” employee contributions, if any. Under this special
rule, you may have the option of not paying tax on the “net unrealized
appreciation” of the stock until you sell the stock. Net unrealized
appreciation generally is the increase in the value of the employer stock while
it was held by the Plan. For example, if employer stock was contributed to your
Plan account when the stock was worth $1,000 but the stock was worth $1,200
when you received it, you would not have to pay tax on the $200 increase in
value until you later sold the stock.

 

You may instead elect not to have the special rule
apply to the net unrealized appreciation. In this case, your net unrealized
appreciation will be taxed in the year you receive the stock, unless you roll
over the stock. The stock can be rolled over to a traditional IRA or another
eligible employer plan, either in a direct rollover or a rollover that you make
yourself. Generally, you will no longer be able to use the special rule for net
unrealized appreciation if you roll the stock over to a traditional IRA or
another eligible employer plan.

 

If you receive only employer stock in a payment that
can be rolled over, no amount will be withheld from the payment. If you receive
cash or property other than employer stock, as well as employer stock, in a
payment that can be rolled over, the 20% withholding amount will be based on
the entire taxable amount paid to you (including the value of the employer
stock determined by excluding the net unrealized appreciation). However, the
amount withheld will be limited to the cash or property (excluding employer stock)
paid to you.

 

If you receive employer stock in a payment that
qualifies as a lump sum distribution, the special tax treatment for lump sum
distributions described above (such as 10-year averaging) also may apply. See
IRS Form 4972 for additional information on these rules.

 

Repayment of Plan Loans.  If your
employment ends and you have an outstanding loan from your Plan, your employer
may reduce (or “offset”) your balance in the Plan by the amount of the loan you
have not repaid. The amount of your loan offset is treated as a distribution to
you at the time of the offset and will be taxed unless you roll over an amount
equal to the amount of your loan offset to another qualified employer plan or a
traditional IRA within 60 days of the date of the offset. If the amount of your
loan offset is the only amount you receive or are treated as having received,
no amount will be withheld from it. If you receive other payments of cash or
property from the Plan, the 20% withholding amount will be based on the entire
amount paid to you, including the amount of the loan offset. The amount
withheld will be limited to the amount of other cash or property paid to you
(other than any employer securities). The amount of a defaulted plan loan that
is a taxable deemed distribution cannot be rolled over.

 

29

 

IV.           SURVIVING SPOUSES, ALTERNATE PAYEES,
AND OTHER BENEFICIARIES

 

In general, the rules summarized above that apply to
payments to employees also apply to payments to surviving spouses of employees
and to spouses or former spouses who are “alternate payees.” You are an
alternate payee if your interest in the Plan results from a “qualified domestic
relations order,” which is an order issued by a court, usually in connection
with a divorce or legal separation.

 

If you are a surviving spouse or an alternate payee,
you may choose to have a payment that can be rolled over, as described in Part
I above, paid in a DIRECT ROLLOVER to a traditional IRA or to an eligible
employer plan or paid to you. If you have the payment paid to you, you can keep
it or roll it over yourself to a traditional IRA or to an eligible employer
plan. Thus, you have the same choices as the employee.

 

If you are a beneficiary other than a surviving spouse
or an alternate payee, you cannot choose a direct rollover, and you cannot roll
over the payment yourself.

 

If you are a surviving spouse, an alternate payee, or
another beneficiary, your payment is generally not subject to the additional
10% tax described in Part III above, even if you are younger than age 591⁄2.

 

If you are a surviving spouse, an alternate payee, or
another beneficiary, you may be able to use the special tax treatment for lump
sum distributions and the special rule for payments that include employer
stock, as described in Part III above. If you receive a payment because of the
employee’s death, you may be able to treat the payment as a lump sum
distribution if the employee met the appropriate age requirements, whether or
not the employee had 5 years of participation in the Plan.

 

HOW TO
OBTAIN ADDITIONAL INFORMATION

 

This notice summarizes only the federal (not state or
local) tax rules that might apply to your payment. The rules described above
are complex and contain many conditions and exceptions that are not included in
this notice. Therefore, you may want to consult with the Plan Administrator or
a professional tax advisor before you take a payment of your benefits from your
Plan. Also, you can find more specific information on the tax treatment of
payments from qualified employer plans in IRS
Publication 575, Pension and Annuity Income, and IRS Publication 590, Individual Retirement Arrangements.
These publications are available from your local IRS office, on the IRS’s
Internet Web Site at www.401kxpress.com, or by calling 1-800-TAX-FORMS.

 

30Exhibit
10.44

 

VOLUME
PURCHASE AGREEMENT (PURCHASER SIDE)

 

This Volume Purchase
Agreement, including the Exhibits A and B (“Agreement”),
effective as 13 November 2001 (“Effective Date”),
is hereby made by and between Ciphergen Biosystems, Inc. of Fremont, California
(“Purchaser”) and [*** Redacted] (“Supplier”), the Parties.

 

 

In consideration of the
mutual promises set forth herein, the parties hereby agree as follows:

 

DEFINITIONS

 

“Product/s”
shall mean “Screen printed hydrophobic coating on Ciphergen supplied
substrates.”

 

SALES AND
PURCHASES OF PRODUCTS.

 

1.                                      Products.
Subject to the terms and conditions of this Agreement, Supplier agrees to sell Products
to Purchaser under the terms and conditions of this Agreement. For purposes of
volume pricing or other terms or conditions dependent on volume, all purchases
of Products by Purchaser shall be aggregated for the benefit of Purchaser.

 

New Product Inclusion.
Supplier agrees to keep Purchaser informed of any new Products or improvements
to existing Products. Purchaser will notify Supplier if it wishes to add a new
product(s) or series of products of Supplier’s to this Agreement. Purchaser and
Supplier shall then proceed to establish pricing and delivery schedules for
each such new Product.  Upon agreement of
these items, such product(s) shall be considered Products under this Agreement,
and shall be purchased and sold under the terms and conditions of this
Agreement. Supplier will make all Products available to Purchaser pursuant to
this section. In addition, if Supplier implements any improved technology
(e.g., without limitation, improved manufacturing processes or improved or
additional cores), Supplier shall promptly so advise Purchaser and, at
Purchaser’s request, discuss with Purchaser the possibility and advantages of
using such improved technology to redesign any Products. At Purchaser’s
request, Supplier will negotiate any redesign in good faith.

 

PRICES;
PAYMENT

 

2.                                      Prices.
The prices to Purchaser of the Products shall be the prices contained in the attached
Exhibit B. All prices are F.O.B. origin.

 

3.                                      Taxes.
Prices stated in Exhibit B and addenda are in U.S. dollars and do not include applicable
U.S. federal or state sales or use taxes which shall be paid by Purchaser if
separately indicated on the invoice for the applicable Product shipment, but do
include any duties, export or import charges and the like.

 

4.                                      Payment
Terms. Supplier will invoice Purchaser with each shipment and payment terms
will be the full invoiced amount payable within thirty (30) days after
Purchaser receives the

 

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

1

 

invoice and shipment (net
30).

 

ORDER AND
DELIVERY

 

5.                                      Purchase
Orders. Purchaser’s purchase orders for Products shall be submitted to Supplier
in writing or Fax. Each purchase order shall include:

 

a. Identification of
Products ordered;

 

b. Quantity to be
purchased;

 

c. Price of Products
ordered;

 

d. Requested delivery
dates;

 

e. Shipping instructions.

 

6.                                      Forecasts.
Purchaser will provide Supplier with non-binding thirty (30) day forecasts of its
requirements for Products on a monthly basis.

 

7.                                      Placement
by Purchaser. All purchases under this Agreement shall be subject only to the
terms and conditions hereof. All references in this Agreement to purchases of,
purchase orders for, or shipments of Products by or to Purchaser shall mean by
or to Purchaser. In the event the terms of any purchase order, acknowledgment,
invoice, confirmation or similar document conflict with or are additional to
the terms of this Agreement, the terms of this Agreement alone shall apply and
shall govern regardless of execution of such document by one or both parties,
except that the parties may agree to negotiate non-preprinted terms which shall
be effective if executed by both parties. No other terms and conditions shall
apply to this Agreement or the purchase orders.

 

8.                                      Changes
and Cancellations. Purchaser shall have the right to reschedule or
cancel any shipment for Products.

 

9.                                      Shipping.
All items shall be shipped in the manner specified by Purchaser or as specified
in the separate Purchase Orders issued hereunder. In the event a shipment will
not meet the delivery date (except as provided in Section 11), routing may
be changed to premium transportation at Purchaser’s request. In that event,
Supplier shall bear the expense of any difference in freight costs for the
premium transportation.

 

10.                               Notice.
Supplier shall provide Purchaser with as much notice as possible if it
anticipates or has reason to believe that Supplier’s output of the Product will
not be sufficient to meet all of Purchaser’s requirements for any period.
Purchaser shall provide supplier with as much notice as possible if it
anticipates or has reason to believe that it will be unable to supply raw
material substrate in time for Supplier to meet shipping deadlines. In the event
that Purchaser is late in providing substrate, Purchaser and Supplier will
agree on revised shipment dates.

 

11.                               Discontinuance.
If production by Supplier or the availability of any Product covered by this
Agreement is to be permanently discontinued at any time during the term of this
agreement,

 

2

 

Supplier shall 1) give
Purchaser at least six (6) months prior written notice of such discontinuance
during which time Supplier shall accept orders from Purchaser for a reasonable
quantity of such Product at the prices called for herein, 2) will grant a
license to Purchaser for preparation and manufacture of Purchaser’s products,
such license to include all technical know-how directly related to production
of Purchaser’s Product, technical specifications, production methodologies, QC
methodologies, formulas, where appropriate. This information will be provided
with enough lead-time for Purchaser to arrange production by alternate means,
so as not to interrupt the supply of finished product to Purchaser.

 

PRODUCT
ACCEPTANCE AND QUALITY

 

12.                               Rejection.
In case any Product is not within specifications (Exhibit A attached), Purchaser
will have the right, at its sole option, to reject such Product; to accept such
Product with a mutually agreed adjustment in price; or to return such Product
for credit or refund. If, after being requested by Purchaser, Supplier fails to promptly replace or correct
any defective item, then Purchaser shall have the right, without limitation, at
its sole option, without further notice, to cancel the applicable purchase
order relative to the rejected material without penalty or terminate this
Agreement for default in accordance with the Termination Section and
require refund of any payments made relative to the rejected Purchase Order
material. At Purchaser’s request, Supplier will provide to Purchaser relevant
information relating to the failure of any rejected Product.

 

13.                               Packing.
Unless otherwise specified by Purchaser, Supplier will package and pack all goods
in a manner that is in accordance with good commercial practice. An itemized
packing list must accompany each shipment that shall include the purchase order
number and quantity of the Products so shipped

 

PRODUCT
SPECIFICATIONS; CHANGES

 

14.                               Specifications.
Supplier agrees to supply Products that conform to applicable specifications.
Supplier shall not make any changes in the form, fit, function, design, performance
or appearance of any Product purchased hereunder, or to any Specifications for
any Product irrespective of impact on form, fit, or function, without Purchaser’s
prior written approval.

 

18.                               Engineering
Change Approval. Supplier shall not make any significant changes to any manufacturing
source, production process, or the controlled process parameters or sources,
types or grade classifications of materials used, with respect to any Product
without first obtaining from Purchaser an engineering change approval. In
addition, within three (3) working days after learning of any bug or other
problem in a Product which may or already has resulted in an impact to the
installed customer base of such Product, and in any event no later than at the
time an engineering request is made, the discovering party will notify the
other of such problem, Supplier shall submit a request to make a change
containing engineering data in support of the request. Within ten (10) working
days of receiving such request, Purchaser shall respond to Supplier’s request
and shall either (i) approve the change, (ii) disapprove the change, or (iii)
extend the deadline for the approval or disapproval period for an additional
twenty (20) working days.

 

3

 

19.                               Costs of Engineering
Changes. All engineering changes resulting from defects or nonconformity’s
in Products shall be implemented at the sole expense of Supplier, unless the defect
or nonconformity is the fault of Purchaser in providing defective functional
specifications or raw material substrates for Products.

 

SUPPORT

 

20.                               Emergency
Part Shipment Procedure. In cases of emergency, as reasonably determined by
Purchaser, Supplier will ship (at Purchaser’s expense) Product(s) with
overnight delivery to Purchaser.

 

21.                               Product
Reports. Supplier will keep accurate records of Product deficiencies and
make such reports available to Purchaser in a timely manner.

 

REPRESENTATIONS
AND WARRANTIES

 

22.                               Warranty
of Title. Supplier warrants and represents to Purchaser that (i) Purchaser
shall acquire good and clear title to the Products, free and clear of all
liens, claims, and encumbrances, (ii) all materials and services provided
hereunder including, without limitation, the Products, are either owned or
properly licensed by Supplier or are in the public domain and the use thereof
by Purchaser, its representatives, distributors, dealers, end users, and other
direct and indirect customers will not infringe any proprietary rights of any
third party, (iii) Supplier has the full power to enter into this Agreement, to
carry out its obligations under this Agreement and to grant the rights and
licenses granted to Purchaser in this Agreement, and (iv) Supplier’s compliance
with the terms and conditions of this Agreement will not violate any federal,
state or local laws, regulations or ordinances or any third party agreements.

 

23.                               Product
Warranty. Supplier warrants that the Products will be new and unused, will perform
in accordance with the applicable Specifications (including related
documentation provided by Supplier and will achieve any function described
therein) and will be free from defects in materials, workmanship or design
until 24 months after acceptance by Purchaser. (“Warranty
Period”).

 

24.                               Return
and Replace Procedure. During the Warranty Period, Supplier will, at its
own expense and risk, replace any defective Products and deliver new Products
to the location designated by Purchaser within twenty (20) working days from
the date of notice by Purchaser. Unless Supplier reasonably demonstrates a
returned item is free from defect, Supplier shall pay the costs of all shipping
and insurance of the defective Products. Purchaser will promptly provide evidence
of defective Products to Supplier or dispose of the defective Products in
accordance with Supplier’s instructions.

 

25.                               Limited
Warranty. This limited warranty does not extend to any defects caused by misuse,
abuse, service by anyone other than a Supplier authorized representative,
Purchaser or a party authorized by Purchaser, or damage due to accident or act
of God. NO OTHER WARRANTIES ARE EXPRESSED OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.

 

4

 

INDEMNIFICATION

 

26.                               Infringement.
The Parties agree to mutually indemnify, defend and hold harmless their officers,
directors, employees, shareholders, direct and indirect customers, agents,
successors and assigns from and against any and all loss, damage, settlement or
expense (including legal expenses), as incurred, resulting from or arising out
of any claims which allege that any Products or the use or sale thereof
infringe upon, misappropriate or violate any Unites States patents, copyrights,
or trade secret rights or other proprietary rights of persons, firms or entities
who are not parties to this Agreement; provided that the Parties (i) promptly
notifies each other, in writing, of any notice or claim of such alleged
infringement or misappropriation involving the Products of which they become
aware, and (ii) mutually permit control, in a manner not adverse to either
Party, the defense, settlement, adjustment or compromise of any such claim
using reasonably acceptable counsel. The Parties shall not enter into any
settlement that affects either Party’s rights or interest without either Party’s
prior written approval

 

27.                               Cure.
If by reason of such infringement claim, Purchaser or its direct or
indirect customers shall be prevented or are likely to be prevented by legal
means from selling or using any Products, or if, in Supplier’s opinion, such
claim is likely to occur, Supplier will use its best efforts, at its expense,
to: (i) obtain all rights required to permit the sale or use of the Products by
Purchaser and its customers; or (ii) modify or replace such Products to make
them non-infringing (and extend this indemnity thereto), provided that any such
replacement or modified Products are satisfactory to Purchaser. If Supplier is
unable to achieve either of the options set forth above within a reasonable
period of time after the issuance of an injunction, but in no event longer than
thirty (30) days after receipt of notice thereof, Supplier shall promptly
refund to Purchaser the invoiced purchase price, plus all shipping, storage,
and associated costs, of any Products returned freight collect to Supplier
which Purchaser or its customers are legally prohibited from selling or using.

 

28.                               Product
Liability Indemnification. Supplier expressly and unequivocally agrees to
and hereby does indemnify, release, defend and hold Purchaser and its officers,
directors, employees, shareholders, agents, successors and assigns harmless
from and against all claims, damages, losses, costs and expenses, including
attorneys’ fees, arising in favor of any person, firm or corporation on account
of product liability in any way relating to the Product, provided that Purchaser
(i) promptly notifies Supplier, in writing, of any notice or claim hereunder of
which it becomes aware, and (ii) permits Supplier to control, in a manner not
adverse to Purchaser, the defense, settlement, adjustment or compromise of any
such claim using counsel reasonably acceptable to Purchaser. Purchaser may
employ counsel, at its own expense (provided that if such counsel is necessary
because of a conflict of interest of either Supplier or its counsel or because
Supplier does not assume control, Supplier will bear such expense), to assist
it with respect to any such claim. Supplier shall not enter into any settlement
that affects Purchaser’s rights or interest without Purchaser’s prior written
approval. Unless Supplier fails to perform its obligations pursuant to this
section, Purchaser shall have no authority to settle any claim on behalf of
Supplier.

 

5

 

LIMITATION
OF LIABILITY

 

29.                               EXCEPT
FOR LIABILITY CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF A PARTY,
UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER UNDER ANY
CONTRACT, STRICT LIABILITY, NEGLIGENCE OR OTHER LEGAL OR EQUITABLE THEORY, FOR
ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS IN CONNECTION WITH THE SUBJECT
MATTER OF THIS AGREEMENT. THIS SECTION DOES NOT LIMIT EITHER PARTY’S
LIABILITY FOR BODILY INJURY OF A PERSON, DEATH, OR PHYSICAL DAMAGE TO PROPERTY.

 

TERM
AND TERMINATION

 

30.                               Term.
Unless terminated earlier as provided herein, this Agreement shall have a term
of one (1) year commencing on the Effective Date, unless terminated sooner by written notice given by a party
pursuant to this Section. This Agreement shall be automatically renewed for
additional successive one (1) year periods, unless written notice of
non-renewal is received by the other party no later than sixty (60) days prior
to the expiration of the then current term. Upon any expiration or termination,
the rights and obligations of the parties shall continue except that Supplier
will not be required to accept further orders or undertake further product
development.

 

31.                               Termination
for Cause. This Agreement may be terminated by a party for cause immediately
by written notice upon the occurrence of any of the following events:

 

a. If the other ceases to
do business, or otherwise terminates its business operations; or

 

b. If the other breaches
any provision of this Agreement and fails to cure such breach within thirty
(30) days (immediately in the case of a breach of Section 9) of written
notice describing the breach; or

 

c. If the other becomes
insolvent or seeks protection under any bankruptcy, receivership, trust deed,
creditors arrangement, composition or comparable proceeding, or if any such proceeding
is instituted against the other (and not dismissed within ninety (90) days).

 

32.                               Termination
for Convenience. Subject to the terms of this Section, Purchaser may terminate
this Agreement (and some or all then outstanding Purchaser purchase orders) hereunder
upon notice to Supplier. Both Purchaser and Supplier agree to cooperate in good
faith to minimize the negative impact to both parties.

 

33.                               Claims.
Any claim by Supplier on account of canceled purchase orders shall be submitted
to Purchaser.

 

34.                               Survival;
Support After Termination. Purchaser’s
right to distribute Products in inventory or subject to any pending purchase
order shall survive termination or expiration of this Agreement.

 

COMPLIANCE
WITH LAWS; IMPORT/EXPORT

 

35.                               Compliance with Laws. Supplier warrants
that in performance of work under this Agreement it has complied with or will
comply with all applicable federal, state, local laws and

 

6

 

ordinances

 

36.                               Force
Majeure. Neither party shall be considered in default of performance of its
obligations under this Agreement to the extent that performance of such
obligations is delayed by force majeure such as fire, flood, earthquake or
other acts of God beyond the reasonable control of such party or its suppliers.
In the event Supplier fails to deliver product due to such causes, Purchaser
may either:

 

a. Terminate this
Agreement or any part hereof as to Product(s) not shipped;

 

b. Suspend this Agreement
in whole or in part for the duration of the delaying cause, and at Purchaser’s
option, buy the Product(s) elsewhere and deduct from any commitment to Supplier
the quantity so purchased. Supplier shall resume performance under this Agreement
immediately after the delaying cause ceases and, at Purchaser’s option, extend
the then current term period for a period equivalent to the length of time the
excused delay endured.

 

37.                               Assignment.
This Agreement shall be binding on the parties hereto and their successors and
assigns; provided, however, that Supplier shall not assign or transfer, in
whole or part, this Agreement or any of its rights or obligations arising
hereunder without the prior written consent of Purchaser. Any purported
assignment without such consent shall be null and void. Purchaser shall not
assign or transfer, in whole or part, this Agreement or any of its rights or
obligations arising hereunder without the prior written consent of Supplier.
Any purported assignment without such consent shall be null and void.

 

38.                               Governing
Law. This Agreement shall be governed by the laws of the State of New York,
without reference to conflict of laws principles.

 

39.                               Independent
Contractors. Supplier shall perform its obligations hereunder as an independent
contractor and shall be solely responsible for its own financial obligations.
Nothing contained herein shall be construed to imply a joint venture or
principal and agent relationship between the parties, and neither party shall
have any right, power or authority to create any obligation, express or
implied, on behalf of the other in connection with the performance hereunder.

 

40.                               Modification.
No alteration, amendment, waiver, cancellation or any other change in any term
or condition of this Agreement shall be valid or binding on either party unless
the same shall have been mutually assented to in writing by both parties.

 

41.                               Waiver.
The failure of either party to enforce at any time any of the provisions of
this Agreement, or the failure to
require at any time performance by the other party of any of the provisions of
this Agreement, shall in no way be construed to be a present or future waiver
of such provisions, nor in any way affect the right of either party to enforce
each and every such provision thereafter. The express waiver by either party of
any provision, condition or requirement of this Agreement shall not constitute
a waiver of any future obligation to comply

 

7

 

with such provision,
condition or requirement.

 

42.                               Notices.
Any notice required or permitted to be given by either party under this Agreement
shall be in writing and shall be personally delivered or sent by commercial
courier service (e.g., DHL), or by first class mail (certified or registered),
or by telecopy confirmed by first class mail (registered or certified), to the
other party at its address first set forth above, or such new address as may
from time to time be supplied hereunder by the parties hereto. If mailed,
notices will be deemed effective three (3) working days after deposit, postage
prepaid, in the mail.

 

43.                               No
Third Party Beneficiaries. Unless otherwise expressly provided, no
provisions of this Agreement are intended or shall be construed to confer upon
or give to any person or entity other than Purchaser, Supplier, and Designated
Third Parties any rights, remedies or other benefits under or by reason of this
Agreement.

 

44.                               Interpretation.
This Agreement represents the negotiated agreement of the parties, with the
advice and assistance of counsel, and shall not be construed against either party
as the drafter thereof.

 

45.                               Entire
Agreement. This Agreement, and the exhibits hereto, represent and
constitute the entire agreement between the parties, may only be amended in
writing signed by both parties, and supersede all prior agreements and
understandings.

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement by persons duly authorized as
of the date and year first above written.

 

The parties have signed
below to indicate their acceptance of the terms of this Agreement.

 

 

	
  PURCHASER

  	
  SUPPLIER

  
	
   

  	
   

  
	
  By:

  	
  /s/ David DeNola

  	
   

  	
  By: [*** Redacted]

  	
   

  
	
   

  	
   

  
	
  Name: David DeNola

  	
  Name: [*** Redacted]

  
	
   

  	
   

  
	
  Title: VP of Operations

  	
  Title: President

  
					

 

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

8

 

EXHIBITS INDEX

 

A- PRODUCT SPECIFICATIONS

 

B- PRICES

 

 

EXHIBIT
A.

 

 

PRODUCT SPECIFICATIONS

 

	
  1.

  	
  Dimensions:

  
	
   

  	
   

  
	
  1.1

  	
  8 spot substrate: [***
  Redacted]

  
	
   

  	
   

  
	
   

  	
  16 spot substrate: [***
  Redacted]

  
	
   

  	
   

  
	
  2.

  	
  Contact
  Angle: over or equal [*** Redacted] for the buffer solution.

  
	
   

  	
   

  
	
  Measure contact angle
  on [*** Redacted] coating using
  [*** Redacted] of the buffer solution [*** Redacted]

  
	
   

  	
   

  
	
  3.

  	
  Appearance:
  according to coupons

  
	
   

  	
   

  
	
  4.

  	
  Pigments:

  

 

[*** Redacted]

 

[*** Redacted]

 

[*** Redacted]

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

9

 

QC Plan
for parts produced by [***
Redacted]

 

1.                                      Definition.

 

A Production lot size (N)
is defined as the quantity of
substrates of a single color from a printing run that can be cured in the oven
at one time.

 

2.                                      The first
article.

 

2.1                               The
first [*** Redacted] articles should be inspected to confirm all dimensions
according to Ciphergen prints.

 

Alignment of the mask will be confirmed prior to any run and closely monitored during any given run.

 

2.1.1                     8 spot substrate: [*** Redacted] 

 

2.1.2                     16 spot substrate: [*** Redacted] 

 

2.2                               The
following parameters should be measured:

 

2.2.1                     8 spot substrate:

 

[*** Redacted]

 

16 spot
substrate:

 

[*** Redacted]

 

3.                                      Acceptance
Sampling

 

An initial print of dummy
substrates supplied by the Purchase should be printed and cured for testing.

 

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

10

 

Prior to any production
run, check for contact angle of the coating with [*** Redacted], supplied by
the Purchaser.

 

3.1                                 Select
randomly (n) substrates from the completed production run of
(N) substrates (see the table below)

 

3.2                                 Measure
contact angle on [*** Redacted] coating using [*** Redacted] of the buffer solution supplied by the
Purchaser.

 

3.3                                 Acceptance
criteria (X is the measured contact angle):

 

	
  N (lot size)

  	
   

  	
  N (sample size)

  	
   

  	
  Kcr

  
	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  
	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  
	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  	
   

  	
  [*** Redacted]

  

 

[*** Redacted]

 

where

 

The lot
will be accepted if it passes inspection in pp. 2 and 3

 

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

11

 

EXHIBIT
B

 

PRODUCT
PRICING

 

The price of [***
Redacted] shipped substrate will be charged to Ciphergen.

 

Set up charge of [***
Redacted] will be waived on any order in excess of [*** Redacted] pieces of Product that is of the same color
and specification.

 

***                           Confidential
treatment requested pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission. 
Omitted portions have been filed separately with the Commission.

 

12

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