Document:

exhibit10_41.htm

     

     

     

     

    
      

      

    

    Exhibit
10.41

     

     

     

    General Services
Agreement

    

    

    This General
Services Agreement (the “Agreement”), dated as of
October 27, 2008, documents the business relationship between Franklin Covey
Co., a Utah corporation (“FC”), and Electronic Data Systems, LLP, a Delaware
corporation (“EDS”), and
describes the terms and conditions under which EDS will provide to FC certain
services, resources and deliverables on an as requested basis.

    

    Whereas,
The Parties entered into an agreement for Information Technology Services, dated
April 1, 2001 which included the various Services to be provided there under
(the “Prior Agreement”).  The Prior Agreement has been amended
numerous times prior to the Effective Date of this Agreement including but not
limited to the Addendum #8 dated as of July  2008, which acknowledged,
among other things, the divestiture of a business unit of FC and elimination of
call center services to FC; and

    

    Whereas
during the term of the Prior Agreement there have been a variety of amendments
and other related agreements as set forth in Schedule 1, Documents Deleted In Their
Entirety And Superseded,
attached hereto,  that are no longer applicable and are hereby deleted
in their entirety and superseded by this Agreement and the Work Orders, as
defined in Section  2(a) below, and

    

    Whereas
during the term of the Prior Agreement, the following documents were executed
between the parties, which shall remain in full force and effect: Implementation
of Oracle 11i Project Implementation Waiver/Release dated1/12/2004; 7 Habits
Development & License Agreement dated 6/30/2001; Sublease by and between
Electronic Data Systems, LLC (Sublandlord) and Franklin Covey Co. (Subtenant)
dated June 30, 2001, and First Amendment to Standard Sublease Agreement dated
2/1/2007; and

    

    Whereas,
The Parties now desire to simplify, consolidate and update the contractual
documents which describe and set forth the current rights and obligations of the
Parties;

     

    Now,
therefore, as of the Agreement Effective Date, the Parties hereby agree
as follows:

     

    

    
      	
              1.

            	
              Term.  Subject
      to Section 11, the term of this Agreement will begin on October 27, 2008
      (the “Effective
      Date”), and, unless earlier terminated as provided in this
      Agreement, will continue through June 30, 2016.  Such original
      term may be extended by mutual written agreement of the
      Parties.  In addition, if one or more Work Orders (as defined
      below) are outstanding when this Agreement expires (whether after the
      original term or otherwise), this Agreement will remain in full force and
      effect solely for purposes of allowing the activities covered by such Work
      Orders to be completed.  The obligations of EDS set forth in
      this Agreement will be performed by EDS, itself and through its
      affiliates.  All references to EDS in this Agreement will be
      deemed to include all such affiliates, and EDS and FC may be referred to
      in this Agreement individually as a “Party” and together as the
      “Parties”.

            

    

    

    
      	
              2.

            	
              EDS
      Services.

            

    

    

    
      	
              (a)  

            	
              Work
      Orders for Services.  During
      the term of this Agreement, FC may request EDS to provide FC with such
      services, resources and deliverables as are mutually agreed upon from time
      to time by EDS and FC and confirmed in a mutually acceptable written
      authorization letter substantially
in

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    
      	
               

            	
              the
      form attached hereto as Exhibit A (the
      “Work
      Order”).  This Agreement establishes the standard
      provisions that will apply to each Work Order.  Each Work Order
      will include, at a minimum, (a) an Attachment 1
      which will describe the services, resources and deliverables that EDS will
      provide thereunder, (b) also in Attachment 1
      will describe FC’s role and responsibilities, if any, in connection with
      such services,  resources and deliverables and (c) an Attachment 2
      which will describe the charges to be paid by FC to EDS in consideration
      for such services, resources and deliverables.  Each Work Order
      will be numbered sequentially beginning with the number one and, when
      executed by the Parties, will be attached hereto and made a part hereof
      for all purposes.  In the event of any express conflict or
      inconsistency between the provisions of an Work Order and the provisions
      of this Agreement, the provisions of the Work Order will govern and
      control with respect to the interpretation of that Work Order; provided, however, that
      the provisions of the Work Order will be so construed to give effect to
      the applicable provisions of this Agreement to the fullest extent
      possible. Any changes or modifications made to this Agreement in
      accordance with Section 19 will
      apply to all Work Orders, and any changes or modifications made to any
      Work Order in accordance with Section 19 will
      apply only to that Work Order, unless the Parties otherwise expressly
      agree in writing.  The work to be performed by EDS under this
      Agreement, as set forth in the Work Orders, is collectively referred to
      herein as the “EDS
      Services”.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Change
      Control Procedures. Subject to the other
      provisions of this Agreement, the Parties may revise, amend, alter or
      otherwise change the nature and scope of the EDS Services being provided
      under an Work Order from time to time by mutual written agreement and
      otherwise in accordance with the procedures set forth in  Exhibit
      A-1.  Such procedures do not apply to changes that result
      in new services, which will be initiated, reviewed, approved, documented
      and implemented in accordance with Section
      2(a).  The Parties agree to consider any proposed changes
      in good faith and to make a good faith effort to accept equitable
      adjustments to the affected Work Order where appropriate to accomplish the
      mutual objectives of the Parties.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Service
      Locations.  Notwithstanding
      anything to the contrary in this Agreement or any Work Order, EDS may
      perform the EDS Services or any portion thereof from any location
      determined by EDS or relocate any software or equipment used by EDS to
      perform the EDS Services; provided, however, that
      EDS will provide FC prior written notice of any change in service location
      and provided,
      further that any change in service location made by EDS will not
      (i) materially and adversely impact EDS’ ability to perform its
      obligations in accordance with the terms hereof, including the achievement
      of any applicable service levels, (ii) increase FC’s fees or costs (unless
      EDS agrees in writing to reimburse FC for such increase) or (iii)
      materially and adversely impact the way in which FC conducts its business
      or operations.

            

    

    

    
      	
              3.

            	
              Representatives.  During
      the term of this Agreement, EDS and FC will each maintain a representative
      who will be its primary point of contact in dealing with the other under
      this Agreement and will have the authority and power to make decisions
      with respect to actions to be taken by it under this
      Agreement.  Either Party may change its representative by giving
      notice to the other of the new representative and the date upon which such
      change will become effective.  In performing its obligations
      under this Agreement, EDS will be entitled to rely upon any routine
      instructions, authorizations, approvals or other information provided to
      EDS by FC’s representative or, as to areas of competency specifically
      identified by such representative, by any other FC personnel identified by
      FC’s representative, from time to time, as having authority to provide the
      same on behalf of FC in such person’s area of
      competency.  Unless EDS knew of any error, incorrectness or
      inaccuracy in such instructions, authorizations, approvals or other
      information, EDS will incur no liability or responsibility of any kind in
      relying on or complying with any such instructions, authorizations,
      approvals or other information.

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              4.  

            	
              Certain
      Financial Matters.  In
      consideration for the performance of the EDS Services, FC will pay to EDS
      the charges set forth in Attachment 2 of
      each Work Order, and such charges will be subject to periodic adjustment
      in the manner and to the extent indicated therein.  In addition,
      FC will pay or reimburse EDS for (a) all pass-through and reasonable
      out-of-pocket expenses incurred by EDS, with the prior written approval of
      FC in writing, in the performance of the EDS Services and (b) any federal,
      state, local, foreign or provincial taxes, assessments, claims and other
      tax charges, including without limitation sales, use, property, fees,
      surcharges, ad valorem, telecommunications, gross receipts, excise, stamp,
      transaction, goods and services, customs, duties and/or value-added taxes,
      and interest imposed in connection therewith, but excluding income taxes
      that are based on or measured by EDS’ net income.  EDS will
      submit a written invoice to FC on a monthly basis in arrears reflecting
      the amount owed to EDS by FC for the EDS Services, with such supporting
      documentation as FC reasonably requests, and FC will pay the invoiced
      amount within 30 days of the date of the invoice.  Payment by FC
      will be by check payable to the order of EDS, except that if any
      outstanding amount exceeding $1,000,000 will be payable to EDS
      electronically (either by wire transfer or ACH) in accordance with payment
      instructions provided by EDS from time to time, so as in each case to
      constitute immediately available funds by 12:00 p.m., local time in the
      place of payment, on the payment date.  If a due date does not
      fall on a business day, payments must be received by EDS on or before one
      business day after such date.  Any past due amounts will bear
      interest until paid at a rate of interest equal to the lesser of (i) the
      prime rate established from time to time by Citibank of New York plus four
      percent or (ii) the maximum rate of interest allowed by applicable
      law.  In addition, at EDS’ request, FC will provide EDS with an
      explanation of why an undisputed amount is not paid when due and a
      proposed payment plan for FC to bring such past due amount
      current.  If FC disputes an amount on an invoice in good faith,
      FC will notify EDS in writing of the specific items in dispute and will
      describe in detail FC’s reason for disputing each such item within 20 days
      of the date of the invoice on which a disputed amount
      appears.  Within 20 days of EDS’ receipt of such notice, the
      Parties will negotiate in good faith pursuant to the provisions of Section 10 to
      reach settlement on any items that are the subject of such
      dispute.  If FC does not notify EDS of any items in dispute
      within such 20-day period of time, FC will be deemed to have approved and
      accepted such invoice. If any portion of an amount due to EDS under this
      Agreement is subject to a bona fide dispute between the Parties as
      provided above, FC will pay to EDS on the date such amount is due all
      amounts not disputed in good faith by FC, and the disputed amount will be
      paid pending resolution of the dispute into an escrow account that is
      structured by agreement of the Parties.  Notwithstanding
      anything to the contrary in this Agreement, in no event may FC withhold in
      any one month, as a disputed amount, more than 50% of EDS’ charges
      (exclusive of reimbursable expenses) for that
  month.

            

    

    

    
      	
              5.

            	
              Employees.  The
      EDS personnel performing the EDS Services will be and remain the employees
      of EDS, and EDS will provide for and pay the compensation and other
      benefits of such employees, including salary, health, accident and
      workers’ compensation benefits and all taxes and contributions which an
      employer is required to pay relating to the employment of
      employees.  During the term of this Agreement and for a period
      of 12 months thereafter, neither Party will solicit, directly or
      indirectly, for employment or employ any employee of the other Party who
      is or was involved in the performance of the EDS Services without the
      prior written consent of such other Party.  For purposes of this
      Section
      5, “solicit” does not include advertisements or other publications
      of general circulation or employment that results directly from responses
      to such advertisements or publications, and such advertisements and
      publications will not constitute a breach of this Section
      5.

            

    

    

    
      	
              6.

            	
              Privacy
      Laws.  The
      Parties acknowledge and agree that FC will be and remain the controller of
      the information relating to FC and its customers that identifies or is
      identifiable to an individual person
(the

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    “FC Personal Data”) for
purposes of all applicable laws relating to data privacy, personal data,
transborder data flow and data protection (collectively, the “Privacy Laws”), with rights
under such laws to determine the purposes for which the FC Personal Data is
processed, and nothing in this Agreement will restrict or limit in any way FC’s
rights or obligations as owner and/or controller of the FC Personal Data for
such purposes.  As such controller of the FC Personal Data, FC is
directing EDS to process the FC Data in accordance with the terms of this
Agreement.  The Parties also acknowledge and agree that EDS may have
certain responsibilities prescribed as of the date hereof by applicable Privacy
Laws as a processor of the FC Personal Data, and EDS hereby acknowledges such
responsibilities to the extent required thereby for processors of personal data
and agrees that such responsibilities will be considered as a part of the EDS
Services to be provided by EDS under this Agreement.  In the event
that Privacy Laws to which the activities contemplated by this Agreement are
subject are modified or new Privacy Laws that are applicable to such activities
come into effect, EDS will work with FC in an effort to continue to comply with
such Privacy Laws, as so modified or added, but to the extent that such
modifications or additions expand the scope or increase the cost of the
activities previously undertaken by EDS pursuant to this Section 6, EDS will,
at FC’s reasonable request, provide such additional activities as additional
services, but only to the extent that the Parties have reached agreement
regarding the nature and scope of such services, the period of time during which
such services will be provided and the basis upon which EDS will be compensated
therefor.

    

    
      	
              7.

            	
              Confidentiality.  EDS
      and FC will have the confidentiality obligations set forth in Exhibit
      B.

            

    

    

    
      	
              8.

            	
              Representations,
      Warranties and Additional Covenants.  EDS
      and FC will have the obligations relating to the representations,
      warranties and additional covenants set forth in Exhibit
      C.

            

    

    

    9.   Ownership.

    

    
      	
              (a)  

            	
              Developed
      Software and Other Deliverables. Each party will
      retain all rights, including trademarks, patents, trade secrets and
      copyrights (“IP Rights”), in any software, ideas, concepts, know-how,
      development tools, techniques or any other proprietary material or
      information that it owned or developed prior to the date of this
      Agreement, or acquired or developed after the date of this Agreement
      without reference to or use of the intellectual property of the other
      party.  Subject to any third party rights or restrictions and
      the other provisions of this Section 9, FC will own the IP Rights (either
      as a work for hire or by assignment from EDS) in and to all deliverables
      that (a) are developed and delivered by EDS under this Agreement and (b)
      are paid for by FC.  Notwithstanding anything to the contrary in
      this Agreement, EDS (i) will retain all IP Rights in and to all software
      development tools, know-how, methodologies, processes, technologies or
      algorithms used in performing the Services which are based on previously
      developed trade secrets or proprietary information of EDS or are otherwise
      owned or licensed by EDS (collectively, “tools”),  (ii) will be
      free to use the ideas, concepts and know-how which are developed or
      created in the course of performing the Services and may be retained by
      EDS’ employees in intangible form, all of which constitute substantial
      rights on the part of EDS in the technology developed as a result of the
      Services performed under this Agreement, and (iii) will retain ownership
      of any prior-developed EDS-owned software or tools (“EDS Tools”) that are
      used in producing the deliverables and become embedded in the
      deliverables.  EDS hereby grants to FC a perpetual (subject to
      compliance with this sentence), royalty-free, nontransferable,
      nonexclusive license to use such embedded EDS Tools (if any) solely in
      connection with FC’s internal use and exploitation of the deliverables and
      only so long as such software and tools (if any) remain embedded in the
      deliverables and are not separated there from.  EDS will own
      patent rights with respect to processes and methodologies developed by EDS
      in connection with deliverables
other

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    than the
copyright ownership rights granted to FC pursuant to this Section
9.  To the extent that EDS commercializes any patent or deliverable
designed, created or paid-for by FC, EDS shall negotiate in good faith with FC a
royalty. Such royalty shall be in a reasonable amount under all of the
circumstances surrounding such commercialization and the total of such royalty
payments shall in any event be limited to the amount required to reimburse FC
for any and all development fees incurred in creating said patent or
deliverable, which limitation shall be agreed upon in writing at the time the
royalty is negotiated.  No licenses will be deemed to have been
granted by either party to any of its patents, trade secrets, trademarks or
copyrights, except as otherwise expressly provided in this
Agreement.  Nothing in this Agreement (A) will require EDS or FC to
violate the proprietary rights of any third party in any software or otherwise
or (B) will impair EDS’ right to acquire, license, market, distribute, develop
for itself or others or have others develop for EDS similar technology
performing the same or similar functions as the technology and Services
contemplated by this Agreement.  The provisions of this Section 9 will
survive the expiration or termination of this Agreement for any reason.

    

    
      	
              (b)  

            	
              Third
      Party Software. To the extent that
      EDS uses any third party software or documentation and such software or
      documentation becomes embedded in a Deliverable, EDS will obtain for FC a
      perpetual, royalty-free, nontransferable, nonexclusive, worldwide license
      to use such software or documentation as part of the Deliverable, or such
      other license as EDS and FC agree in writing. Nothing in this Agreement
      will require EDS or FC to violate the proprietary rights of any third
      party in any software or otherwise.

            

    

    

    
      	
              (c)  

            	
              EDS
      Development Tools; Residual Technology. Notwithstanding
      anything to the contrary in this Agreement, EDS will retain all right,
      title and interest in and to, and will be free to use, (a) the EDS
      Development Tools and (b) subject to the confidentiality obligations set
      forth in Section
      7, the Residual Technology.  The Parties acknowledge and
      agree that EDS’ right, title and interest in and to the Residual
      Technology constitute substantial rights in the technology developed as a
      result of the Services performed under this Agreement. No licenses will be
      deemed to have been granted by either Party to any of its patents, trade
      secrets, trademarks or copyrights, except as otherwise expressly provided
      in this Agreement.  Nothing in this Agreement will require EDS
      or FC to violate the proprietary rights of any third party in any software
      or otherwise.  The term “Residual Technology” means the ideas,
      concepts, methodologies, processes and know-how which are developed or
      created by EDS in the course of performing the Services and may be
      retained by EDS’ employees in intangible
form.

            

    

    

    
      	
              (d)  

            	
              Licenses.  EDS
      hereby grants to FC a perpetual, royalty-free, nontransferable,
      nonexclusive, worldwide license to use any embedded Tools and Residual
      Technology as part of the Deliverables.  No licenses will be
      deemed to have been granted by either Party to any of its patents, trade
      secrets, trademarks or copyrights, except as otherwise expressly provided
      in this Section
      9.

            

    

    

    
      	
               
      

            	
              (e)

            	
              Rights
      in Software Outside this Agreement.  Each
      Party will retain all rights in any software, documentation, tools,
      techniques, methodologies, trade secrets or any other proprietary material
      or information that it owned as of the date of this Agreement or acquired
      or developed after the date hereof without reference to or use of the
      intellectual property of the other
Party.

            

    

    

    
      	
               
      

            	
              (f)

            	
              Other.  EDS
      and FC agree to execute and deliver such other instruments and documents
      as either Party reasonably requests to evidence or effect the transactions
      contemplated by this Section
      9.

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    The
provisions of this Section 9 will
survive the expiration or termination of this Agreement for any
reason.

    

    
      	
              10.

            	
              Dispute
      Escalation and Resolution.

            

    

    

    (a)           In
the event of any dispute, controversy or claim arising under, out of, in
connection with or in relation to this Agreement or any Work Order, or the
breach, termination, validity or enforceability of any provision hereof or
thereof (a “Dispute”),
then upon the written request of either Party, each of the Parties will appoint
a designated senior business executive whose task it will be to meet of the
purpose of endeavoring to resolve the Dispute.  The designated
executives will meet as often as the Parties reasonably deem necessary in order
to gather an furnish to the other all information with respect to the matter in
issue which the Parties believe to be appropriate and germane in connection with
its resolution.  Such executives will discuss the Dispute and will
negotiate in good faith in an effort to resolve the Dispute without the
necessity of any formal proceeding relating thereto.  The specific
format for such discussions will be left to the discretion of the designated
executives buy may include the preparation of agreed upon statements of fact or
written statements of position furnished to the other Party.  Nor
formal proceedings for the resolution of the Dispute under Section 10(b) or
Section 10(c) may be commenced until the earlier to occur of (i) a good faith
mutual conclusion by the designated executives that amicable resolution through
continued negotiation of the matter in issue does not appear likely or (ii) the
30th
day after the initial request to negotiate the Dispute.

    

    (b)           Any
Dispute not resolved informally through negotiation between the Parties pursuant
to Section 10(a) will be submitted to non-binding mediation.  The
Parties will mutually determine who the mediator will be from a list of
mediators obtained from the Judicial, Arbitration and Mediation Service office
located in the city determined as set forth below in this Section 10(b) (“JAMS”).  If the
Parties are unable to agree on the mediator, the mediator will be selected by
JAMS.

    

    (c)           If
any Dispute is not resolved through mediation pursuant to Section 10(b), it will
be resolved by final and binding arbitration conducted by a panel of three
arbitrators in accordance with and subject to the JAMS Comprehensive Arbitration
Rules and Procedures then applicable.  One arbitrator will be selected
by FC, one arbitrator will be selected by EDS and the third arbitrator will be
selected by the arbitrators designated by FC and EDS.  If the two
arbitrators cannot agree on a third arbitrator, the third arbitrator will be
selected by JAMS.  The arbitrators will allow such discovery as is
appropriate, consistent with the purposes of arbitration in accomplishing fair,
speedy and cost effective resolution of disputes.  The arbitrators
will reference the Federal Rules of Civil Procedure then in effect in setting
the scope of discovery, except that no requests for admissions will be permitted
and interrogatories will be limited to identifying (a) persons with
knowledge of relevant facts and (b) expert witnesses and their opinions and the
bases therefor.  Judgment upon the award rendered in any such
arbitration may be entered in any court having jurisdiction
thereof.  Any negotiation, mediation or arbitration conducted pursuant
to this Section
10 will take place in Plano, Texas, if initiated by FC, and in Salt Lake
City, Utah, if initiated by EDS, and each Party will bear its own costs and
expenses with respect to any such negotiation, mediation or arbitration,
including one-half of the fees and expenses of the mediator or arbitrators, if
applicable.  Other than those matters involving injunctive relief or
any action necessary to enforce the final award of the arbitrators, the Parties
agree that the provisions of this Section 10(c) are a
complete defense to any suit, action or other proceeding instituted in any court
or before any administrative tribunal with respect to any Dispute or the
performance of the EDS Services by EDS.  Nothing in this Section 10(c)
prevents the Parties from exercising their right to terminate this Agreement and
all outstanding Work Orders in accordance with Section
11.

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              11.

            	
              Termination.  If
      either Party materially defaults in the performance of any of its
      obligations under this Agreement or any Work Order, which default (a) if
      of a non-monetary nature, is not substantially cured within 30 days
      after notice is given to the defaulting Party specifying the default or,
      with respect to those defaults that cannot reasonably be cured within 30
      days, should the defaulting Party fail to proceed within 30 days to
      commence curing the default and thereafter to proceed with all reasonable
      diligence to substantially cure the default, or (b) if of a monetary
      nature, is not cured within 10 days after notice is given to the
      defaulting Party specifying the default, the Party not in default may, by
      giving written notice thereof to the defaulting Party, terminate this
      Agreement and all outstanding Work Orders as of a date specified in such
      notice of termination.  In addition to the requirements of Section 17, to
      be effective and to commence the running of any applicable cure period,
      any notice given pursuant to this Section 11 must
      explicitly identify the type of notice being given, whether of default or
      of termination, and reference this Section
      11.  In addition and except as otherwise set forth in a
      specific Work Order, FC may terminate this Agreement at any time upon at
      least six (6) months prior written notice to EDS.  Upon
      expiration or termination of this Agreement and all Work Orders for any
      reason, except as set forth in the last sentence of Section 1, EDS
      will cease to perform the EDS Services for FC, and FC will pay to EDS all
      sums due to EDS as a result of the EDS Services performed and expenses
      incurred (including those expenses that, instead of being concurrently
      billed, have been included in future payments to be made by FC) through
      the effective date of such expiration or termination (prorated as
      appropriate).  The expiration or termination of this Agreement
      and all Work Orders for any reason will not release either Party from any
      liabilities or obligations set forth herein or therein which (a) the
      Parties have expressly agreed will survive any such expiration or
      termination or (b) remain to be performed or by their nature would be
      intended to be applicable following any such expiration or
      termination.  Any materials or equipment furnished by FC and any
      materials or equipment, the cost are reimbursed to EDS by the FC
      hereunder, are to be and remain the sole property of FC and are to be
      returned to FC within thirty (30) days of the expiration or earlier
      termination of this Agreement, or within ten (10) days after written
      demand by FC, whichever first occurs. 

            

    

    

    
      	
              12.

            	
              Indemnities.  EDS
      and FC will have the indemnity obligations set forth in Exhibit
      D.

            

    

    

    
      	
              13.

            	
              Liability.

            

    

    

    
      	
               
      

            	
              (a)

            	
              General
      Limitation.  Subject
      to the last sentence of this Section 13(a),
      the liability of each Party to the other for all damages arising out of or
      related to an Work Order, regardless of the form of action that imposes
      liability, whether in contract, equity, negligence, intended conduct, tort
      or otherwise, will be limited to and will not exceed, in the aggregate for
      all claims, actions and causes of action of every kind and nature, the
      Work Order Damages Limit for such Work Order.  The “Work Order
      Damages Limit” for each Work Order will be stated in such Work
      Order.  However, if the Work Order Damages Limit is omitted from
      an Work Order, the Work Order Damages Limit for such Work Order will be
      equal to the charges paid by FC to EDS under such  Work Order
      for the 12 months preceding the last act or omission giving rise to such
      liability or, if 12 months have not elapsed since the effective date of
      such Work Order, an amount equal to the charges paid by FC for the number
      of months that have elapsed.   The liability of each Party
      to the other for all damages arising out of or related to this Agreement
      and all Work Orders, regardless of the form of action that imposes
      liability, whether in contract, equity, negligence, intended conduct, tort
      or otherwise, will be limited to and will not exceed, in the aggregate for
      all claims, actions and causes of action of every kind and nature, the
      lesser of sum of
      $5,000,000.00 or the charges paid by FC to EDS under this Agreement
      and all Work Orders for the 12 months preceding the last act or omission
      giving rise to such liability or, if 12 months have not elapsed since the
      Effective Date, an amount equal to the charges paid by FC for the number
      of months that have elapsed (the “Aggregate Damages
      Limit”).

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              (b)

            	
              Limitation
      on Other Damages.  In
      no event will the measure of damages payable by either Party include, nor
      will either Party be liable for, any amounts for loss of income, profit or
      savings or indirect, incidental, consequential, exemplary, punitive or
      special damages of any Party, including third parties, even if such Party
      has been advised of the possibility of such damages in advance, and all
      such damages are expressly
disclaimed.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Exceptions
      to Limitations.  The
      limitations set forth in Sections 13(a)
      and 13(b)
      will not apply to (i) the liability of either Party to the extent
      such liability results from (A) that Party’s acts of intentional tortious
      conduct or gross negligence in the performance or nonperformance of its
      obligations under this Agreement or (B) that Party’s nonperformance of its
      payment obligations to the other expressly set forth in this Agreement
      (including, with respect to FC, FC’s obligation to make payments to EDS
      during the term of this Agreement as required hereby, whether in the form
      of charges or for payment or reimbursement of taxes, out-of-pocket
      expenses or pass-through expenses, and EDS’ lost profits on such payments)
      or (ii) the tax-related liabilities of FC under Section
      4  and Exhibit
      D.

            

    

    

    
      	
               
      

            	
              (d)

            	
              [Reserved]

            

    

    

    
      	
               
      

            	
              (e)

            	
              Acknowledgement.  The
      Parties expressly acknowledge that the limitations and exclusions set
      forth in this Section 13 have
      been the subject of active and complete negotiation between the Parties
      and represent the Parties’ agreement taking into account each Party’s
      level of risk associated with the performance or nonperformance of its
      obligations under this Agreement and the payments and other benefits to be
      derived by each Party pursuant to this Agreement.  The
      provisions of this Section 13 will
      survive the expiration or termination of this Agreement and each Work
      Order for any reason.

            

    

    

    
      	
              14.

            	
              Excused
      Performance.  Neither
      Party will be deemed to be in default hereunder, or will be liable to the
      other, for failure to perform any of its non-monetary obligations under
      this Agreement or any Work Order for any period and to the extent that
      such failure results from any event or circumstance beyond that Party’s
      reasonable control, including acts or omissions of the other Party or
      third parties, natural disasters, health crises such as epidemics and
      pandemics, riots, war, terroristic activity, civil disorder, court orders,
      acts or regulations of governmental bodies, labor disputes or failures or
      fluctuations in electrical power, heat, light, air conditioning or
      telecommunications equipment or lines, or other equipment failure, and
      which it could not have prevented by reasonable precautions or could not
      have remedied by the exercise of reasonable efforts, provided that the
      exercise of such reasonable precautions or reasonable efforts will not
      require the incurrence of any additional cost or
  expense.

            

    

    

    
      	
              15.

            	
              Export
      Regulations.  This
      Agreement is expressly made subject to any United States and other
      applicable laws, regulations, orders or other restrictions regarding
      export from the United States or another country, and import into any
      country, of computer hardware, software, technical data or other items, or
      derivatives of such hardware, software, technical data or other
      items.  Notwithstanding anything to the contrary in this
      Agreement, neither Party will directly or indirectly export (or re-export)
      any computer hardware, software, technical data or any other item provided
      to or by it for purposes of this Agreement, or any derivative of the same,
      or permit the shipment of the same:  (a) into (or to a national
      or resident of) Cuba, North Korea, Iran, Iraq, Sudan, Syria or any other
      country to which the United States has embargoed goods; (b) to anyone on
      the U.S. Treasury Department’s List of Specially Designated Nationals,
      List of Specially Designated Terrorists or List of Specially Designated
      Narcotics Traffickers, or the U.S. Commerce Department’s Denied Parties
      List; or (c) to any person, country or destination for which the United
      States

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    or
another country with jurisdiction, or any agency of the same, requires an export
license or other authorization for export without first having obtained any such
license or other authorization required.  FC will provide to EDS not
less than 10 days’ prior written notice in the event that any technical data,
hardware, software or other items provided by FC that will be used or accessed
by EDS in providing the EDS Services is controlled for export under the
International Traffic in Arms Regulations or other applicable laws (unless such
items are controlled for export under United States law only as ECCN EAR99) and,
if requested by EDS, will provide the ECCN classification of any such item, or
the similar classification as appropriate under other applicable
law.  Unless otherwise expressly agreed, FC will be the importer of
record of any items for which import is required for delivery of any portion of
the EDS Services outside the United States.  Each Party will
reasonably cooperate with the other and will provide to the other promptly upon
request any end-user certificates, affidavits regarding re-export or other
certificates or documents as are reasonably requested to obtain authorizations,
consents, licenses and/or permits required for any payment or any export or
import of products or services under this Agreement.  The provisions
of this Section
15 will survive the expiration or termination of this Agreement for any
reason.

    

    
      	
              16.

            	
              Right
      to Engage in Other Activities.  FC
      acknowledges and agrees that EDS may provide technology services for third
      parties at any EDS facility that EDS may utilize from time to time for
      performing the EDS Services.  Subject to the restrictions on the
      disclosure of confidential information set forth in Exhibit B,
      nothing in this Agreement or any Work Order will impair EDS’ right to
      acquire, license, market, distribute, develop for itself or others or have
      others develop for EDS similar technology performing the same or similar
      functions as the technology and EDS Services contemplated by this
      Agreement.

            

    

    

    
      	
              17.

            	
              Notices.  All
      notices under this Agreement and each Work Order will be in writing and
      will be deemed to have been duly given if delivered personally or by a
      nationally recognized courier service, faxed or mailed by registered or
      certified national mail service, return receipt requested, postage
      prepaid, to the Parties at the addresses set forth below.  All
      notices under this Agreement and each Work Order that are addressed as
      provided in this Section 17, (a)
      if delivered personally or by a nationally recognized courier service,
      will be deemed given upon delivery, (b) if delivered by facsimile, will be
      deemed given when confirmed and (c) if delivered by mail in the manner
      described above, will be deemed given on the date received by the
      recipient as reflected on the return receipt.  Either Party may
      change its address or designee for notification purposes by giving notice
      to the other of the new address or designee and the date upon which such
      change will become effective.

            

    

    

    In the
case of FC:

    

    2200 West
Parkway Blvd.

    Salt Lake
City, Utah 84119 

    

    Fax:
(801) 817-8069

    Attention:  Steve
Young

    

    With a
copy to:

    

    Franklin
Covey

    2200 West
Parkway Blvd.

    Salt Lake
City, Utah 84119

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    Fax:  (801)
817-8197

    Attention:  Legal
Service

    

    and

    

    In the
case of EDS:

    

    c/o
Franklin Covey

    2250 West
Parkway Blvd.

    Salt Lake
City, Utah 84119

    Fax:
(801) 817-8069

    Attention:  Joe
Haynie or Franklin Covey Products EDS Account Executive

    

    With a
copy to:

    

    Office of
the General Counsel

    5400
Legacy Drive

    Plano,
TX  75024

    Fax:

    Attention:  General
Counsel

    

    
      	
              18.

            	
              Public
      Relations and Marketing References.  Each
      Party will coordinate with the other regarding any media release, public
      announcement or similar disclosure relating to this Agreement or any Work
      Order or its subject matter and will give the other Party a reasonable
      opportunity to review and comment on the content of such release,
      announcement or disclosure prior to its release.  This provision
      does not alter the restrictions on the disclosure of confidential
      information set forth in Exhibit B and,
      subject to Exhibit B, will
      not be construed so as to delay or restrict either Party from disclosing
      any information required to be disclosed in order to comply with any
      applicable laws, rules or regulations.  Notwithstanding the
      foregoing but subject to any applicable laws, rules or regulations, each
      Party will have the right to list the name of the other Party, to make
      general references to the basic nature of the relationship between the
      Parties under this Agreement and to describe generally the type of
      services being provided by EDS to FC under this Agreement and each Work
      Order in such Party’s promotional and marketing materials, in such Party’s
      oral or visual presentations to third parties, in interviews conducted by
      the news media or securities analysts and in or through any other
      available media channels, including print, internet, radio, cable and
      broadcast mediums.

            

    

    

    
      	
              19.

            	
              Other.  Where
      agreement, approval, acceptance or consent of either Party is required by
      this Agreement or any Work Order, such action will not be unreasonably
      withheld, delayed or conditioned.  The Parties are independent
      contractors, and neither this Agreement nor any Work Order will be
      construed as constituting either Party as partner, joint venturer or
      fiduciary of the other.  If any provision (other than a
      provision relating to any payment obligation) of this Agreement or any
      Work Order or the application hereof or thereof to any persons or
      circumstances is, to any extent, held invalid or unenforceable, the
      remainder of this Agreement and each Work Order or the application of such
      provision to persons or circumstances other than those as to which it is
      invalid or unenforceable will not be affected thereby, and each provision
      of this Agreement and each Work Order will be valid and enforceable to the
      extent permitted by law.  The provisions of this Agreement will
      be given equal weight regardless of the order in which they appear
      herein.  Nothing in this Agreement or any Work Order may be
      relied upon or will benefit any party other than EDS and
      FC.  This Agreement and each Work Order (a) will be governed by
      the substantive laws of the State
of

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    Utah
(without giving effect to any choice-of-law rules that may require the
application of the laws of another jurisdiction and subject to the last two sentences of
this Section 19), (b)
will be binding on the Parties and their successors and permitted assigns, (c)
may not be assigned by either Party without the prior written consent of the
other (except that EDS will have the right to perform the EDS Services itself
and through its affiliates and to subcontract to third parties portions of the
EDS Services, so long as EDS remains responsible for the obligations performed
by any of its affiliates or subcontractors to the same extent as if such
obligations were performed by EDS) and (d) may not be changed or modified
orally, but only by a written amendment or revision signed by the
Parties.  This Agreement and each Work Order (including any exhibits
or attachments referred to herein or therein and attached hereto or thereto,
each of which is incorporated herein or therein, as applicable, by this
reference for all purposes) constitute, as of the effective date of this
Agreement or that Work Order, as applicable, the full and complete statement of
the agreement of the Parties with respect to the subject matter hereof and
thereof and supersede any previous or contemporaneous agreements, understandings
or communications, whether written or oral, relating to such subject
matter.

    

    
      	
              20

            	
              Audit
      Rights.

            

    

    

    
      	
               
      

            	
              (a)

            	
              General.  Employees
      of FC and its auditors who are from time to time designated by FC and who
      agree in writing to the security and confidentiality obligations and
      procedures reasonably required by EDS will be provided with reasonable
      access to any facility at which the Services are being performed to enable
      them to conduct audits of EDS’ performance of the Services and other
      matters relevant to this Agreement, including (i) verifying the accuracy
      of EDS’ charges to FC and (ii) verifying that the Services are being
      provided in accordance with this Agreement, including any Service
      Levels.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Procedures.  Such
      audits may be conducted once a year during reasonable business hours;
      provided,
      however,
      that the Parties may agree to more frequent audits as deemed reasonably
      necessary.  FC will provide EDS with prior written notice of an
      audit.  EDS will cooperate in the audit, will make the
      information reasonably required to conduct the audit available on a timely
      basis and will assist the designated employees of FC or its auditors as
      reasonably necessary.  If FC requests resources beyond those
      resources then assigned to the account team under this Agreement who are
      able to provide reasonable assistance of a routine nature in connection
      with such audit, such resources will be provided as Additional
      Services.  EDS will retain records that support EDS’ performance
      of the Services and other matters relevant to this Agreement in accordance
      with EDS’ retention guidelines.  Notwithstanding anything to the
      contrary in this Agreement, EDS will not be required to provide access to
      the proprietary data of EDS or other EDS customers.  All
      information learned or exchanged in connection with the conduct of an
      audit, as well as the results of any audit, is confidential and will be
      subject to Section
      7.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Results.  Following
      an audit, FC will conduct an exit conference with EDS to discuss issues
      identified in the audit that pertain to EDS, and FC will give EDS a copy
      of any portion of the audit report pertaining to EDS.  The
      Parties will review each EDS audit issue and will determine (i) what,
      if any, actions will be taken in response to such audit issues, when and
      by whom and (ii) which Party will be responsible for the cost of taking
      the actions necessary to resolve such issues.  Any such
      determination will be based on the following criteria:  (A) who
      the owner of the original deficiency is; (B) who has contractual
      responsibility for the improvement of internal controls; and (C) who owns
      the standards against which the audit is done.  EDS will not be
      responsible for the cost of an audit, except to the extent the audit
      expenses are incurred in connection with a specific audit limited to EDS
      and the an original material deficiency discovered in the audit is
      attributable

            

    

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    to EDS,
or otherwise agreed to in writing by the Parties.  For the purposes of
this Agreement a “material deficiency” is any discrepancy between charges billed
and actual billable charges of greater than five percent (5%).

    

    

    In Witness
Whereof, the Parties have duly executed and delivered this Agreement by
their duly authorized representatives as of the date first set forth
above.

    

    

    
      	
              FRANKLIN
      COVEY CO

               

               

            	 
      	
              ELECTRONIC
      DATA SYSTEMS, LLP

            
	
              By:

            	
                  
      /s/ Robert A. Whitman

            	 
      	
              By:

            	
                  
      /s/ Bjoern Peterson

            
	
              Title:

            	
              Chairman
      and CEO

            	 
      	
              Title:

            	
              Regional
      Manager of Retail Industries

            
	
              Printed
      Name:

            	
              Robert
      A. Whitman

            	 
      	
              Printed
      Name:

            	
              Bjoern
      Peterson

            
	
              Address:

            	
              2200
      West Parkway Blvd.

              Salt
      Lake City, UT  84119

            	 
      	
              Address:

            	
              5400
      Legacy Drive

              Plano,
      TX  75024

            
	
              Date:

            	 
      	 
      	
              Date:

            	 
      

    

    

    

    

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      SCHEDULE
1

      

      DOCUMENTS FROM PRIOR
AGREEMENT

      DELETED IN THEIR ENTIRETY
AND SUPERSEDED

      BY GENERAL SERVICES
AGREEMENT

      

      
        	
                Date:

              	
                4/1/2001

              	
                Original
      Agreement for Information Technology Services

              
	
                Purpose:

              	 
      	
                Original
      IT Outsource

              
	 
      	
                2.1

              	
                Employee
      Offerees

              
	 
      	
                2.2

              	
                Key
      Positions

              
	 
      	
                2.7(b)

              	
                Franklin
      Covey Competitors

              
	 
      	
                3.2

              	
                Statement
      of Work

              
	 
      	
                3.2(a)

              	
                Service
      Levels

              
	 
      	
                3.2(b)

              	
                Responsibility
      Matrix

              
	 
      	
                3.2(c)

              	
                Supported
      Locations

              
	 
      	
                5

              	
                Maintenance
      Contracts

              
	 
      	
                7

              	
                Supported
      Products

              
	 
      	
                9.1(a)

              	
                Charges
      - Variable Monthly

              
	 
      	
                9.1(b)

              	
                Charges
      - Baseline Monthly

              
	 
      	
                9.5(a)

              	
                Tax
      Mapping

              
	 
      	
                11.4

              	
                Termination
      for Convenience

              
	 
      	
                13.8

              	
                Address
      for Notices

              
	 
      	 
      	 
      
	
                Date:

              	
                5/14/2001

              	
                Amendment
      and Re-Incorporation Agreement

              
	
                Purpose:

              	 
      	
                Add
      ecommerce hosting to agreement

              
	 
      	 
      	 
      
	
                Date:

              	
                6/30/2001

              	
                Amendment
      #2 to IT Agreement

              
	
                Purpose:

              	 
      	
                Extend
      term of IT services to CC & WH length

              
	 
      	 
      	 
      
	
                Date:

              	
                6/30/2001

              	
                Additional
      Services Addendum #1

              
	
                Purpose:

              	 
      	
                Add
      Call Center & Warehouse Services

              
	 
      	 
      	 
      
	
                Date:

              	
                9/27/2002

              	
                Amendment
      and Re-Incorporation Agreement #2

              
	
                Purpose:

              	 
      	
                Modifies
      pricing and SLAs on WH/CC

              
	 
      	 
      	 
      
	
                Date:

              	
                10/1/2002

              	
                Additional
      Services Addendum #3

              
	
                Purpose:

              	 
      	
                Tech
      Support Call Center

              
	 
      	 
      	 
      
	
                Date:

              	
                1/12/2004

              	
                Addendum
      #4: Project Implementation Resolution

              
	
                Purpose:

              	 
      	
                Resolve
      dispute re implementation

              
	 
      	 
      	 
      
	
                Date:

              	
                2/24/2004

              	
                Amend/Reincorp

              
	
                Purpose:

              	 
      	
                Changes
      WH/CC Pricing

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                Date:

              	
                10/1/2004

              	
                Amend/Reincorp
      #3

              
	
                Purpose:

              	 
      	
                Include
      retail IT support

              
	 
      	 
      	 
      
	
                Date:

              	
                4/1/2006

              	
                Amendment
      No. 6

              
	
                Purpose:

              	 
      	
                IT
      scope changes

              
	 
      	 
      	 
      
	
                Date:

              	
                2/21/2007

              	
                Amendment
      No. 7

              
	
                Purpose:

              	 
      	
                Adjust
      fixed charges

              
	 
      	 
      	 
      
	
                Date:

              	
                7/23/2002

              	
                MOU-Retek/McHugh
      and Oracle 11i

              
	
                Purpose:

              	 
      	
                Implementation
      of Oracle 11i

              
	 
      	 
      	 
      
	
                Date:

              	
                10/16/2002

              	
                MOU-Retek/McHugh
      and Oracle 11i

              
	
                Purpose:

              	 
      	
                GS160
      and Project extension

              
	 
      	 
      	 
      
	
                Date:

              	
                07/06/2008

              	
                Addendum
      #8

              
	
                Purpose:

              	 
      	
                Acknowledgement
      Of the divestiture of a business unit of FC and elimination of call center
      services to FC

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
A

      Form
of Work Order

      

      AUTHORIZATION
LETTER  NO. _______

      

      This Work Order
No. _______ will confirm the mutual understanding and agreement of
_______________ (“FC) and Electronic Data Systems, LLP ("EDS") as to the terms
and conditions pursuant to which EDS, itself and through its affiliates, will
perform the services and produce the deliverables described in this Work Order
No. _______.  All references to EDS in this Work Order No. _______
will be deemed to include all such affiliates, and EDS and FC may be referred to
herein individually as a “Party” and together as the “Parties”.  The
terms and conditions of this Work Order No. _______ are as follows:

      

      

      
        	
                1.

              	
                This
      Work Order No. _______ is entered into by the Parties under the provisions
      of that certain General Services Agreement, dated as of _______________,
      _______, between FC and EDS (the “Agreement”), and, except as otherwise
      provided in this Work Order No. _______, all provisions of the Agreement
      are applicable to this Work Order No.
_______.

              

      

      

      
        	
                2.

              	
                The
      term of this Work Order No. _______ will begin on _______________,
      _______, and, unless earlier terminated as provided in the Agreement, will
      continue through _______________, _______.  The term of this
      Work Order No. _______ may be extended by mutual written agreement of the
      Parties.

              

      

      

      
        	
                3.

              	
                During
      the term of this Work Order No. _______, EDS will perform the services and
      produce the deliverables described in Attachment
      1.

              

      

      

      
        	
                4.

              	
                During
      the term of this Work Order No. _______, FC will, at its own cost and
      expense, have the obligations to EDS also as described in Attachment
      1.

              

      

      

      
        	
                5.

              	
                For
      the services performed and the deliverables produced by EDS under this
      Work Order No. _______, FC will pay to EDS the charges described in Attachment 2,
      [as such charges are
      adjusted from time to time as provided in Attachment
      2].

              

      

      

      6.           This
Work Order No. _______ will also be subject to the additional provisions set
forth below.

      

      
        	
                 
      

              	
                [Include any additional
      provisions.]

              

      

      

      
        	
                7.

              	
                The
      amount of the Work Order Damages Limit for this Work Order No. _______ is
      $_______________.

              

      

      

      In Witness
Whereof, the Parties have duly executed and delivered this Work Order No.
_______ by their duly authorized representatives as of _______________,
_______.

      

      

      
        	
                FRANKLIN
      COVEY CO.

              	 
      	
                ELECTRONIC
      DATA SYSTEMS, LLP

                 

              
	
                By:

              	 
      	 
      	
                By:

              	 
      
	
                Title:

              	 
      	 
      	
                Title:

              	 
      
	
                Printed
      Name:

              	 
      	 
      	
                Printed
      Name:

              	 
      
	
                Address:

              	
                 
      

                 

              	 
      	
                Address:

              	 
      
	
                Date:

              	 
      	 
      	
                Date:

              	 
      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Attachment
1

      to

      Work
Order No. _______

      

      EDS
Services

      

      

      [To
be added.]

      

      Add
FC obligations/tasks as applicable

      

      

      [See Import/Export Note in
Section
2.]

    

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Attachment
2

      to

      Work
Order No. _______

      

      Charges

      

      

      [To
be added.]

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
A-1

      Change
Control Procedures

      

      

      
        	
                 
      

              	
                Either
      Party may request changes to the EDS Services in accordance with the
      following requirements:

              

      

      

      
        	
                A-1-1.

              	
                Change
      Request.  A
      Party will notify the other Party’s primary representative designated
      pursuant to Section 3 of
      this Agreement in writing of a requested change and will include in such
      notice sufficient details of the change to enable such other Party to
      evaluate it (the “Change
      Request”).

              

      

      

      
        	
                A-1-2.

              	
                Preliminary
      Estimate.  If
      EDS submits a Change Request to FC, it will include with such Change
      Request an estimate (the “Preliminary Estimate”)
      of the time and cost to make the requested change.  If FC
      submits a Change Request to EDS, EDS will, within a reasonable period of
      time following the date of receipt of the Change Request, provide FC with
      a Preliminary Estimate of the time and cost to make the requested
      change.

              

      

      

      
        	
                A-1-3.

              	
                Response
      Period. Within the time
      frame specified by EDS in the Preliminary Estimate (the “Response Period”), FC
      will notify EDS in writing whether or not to proceed with the assessment
      of the Change Request.  If, within the Response Period, FC
      notifies EDS in writing not to proceed, the Change Request will be deemed
      withdrawn, and EDS will take no further action on it.  If EDS
      does not receive any notice from FC within the Response Period, FC will be
      deemed to have advised EDS not to
proceed.

              

      

      

      
        	
                A-1-4.

              	
                Change
      Control Document.  If,
      within the Response Period, FC notifies EDS in writing to proceed with the
      assessment of the Change Request, EDS will prepare a document (the “Change Control
      Document”) in accordance with the Preliminary Estimate which
      includes (i) a description of the change, (ii) the benefit of or reason
      for the change, (iii) the issues or concerns with the change, (iv) the
      priority of the change, (v) the modifications, additions and/or deletions
      that need to be made to the affected Work Order in order to implement the
      change, including the proposed increase or decrease in the charges to be
      paid by FC thereunder, and (vi) the potential impact on the current nature
      and scope of the EDS Services, including service levels and any project
      delivery schedules.

              

      

      

      
        	
                A-1-5.

              	
                Acceptance
      by EDS.  EDS
      will provide FC with the completed Change Control Document, signed by EDS,
      which will constitute an offer by EDS to implement the Change Request with
      all associated changes to the affected Work Order specified in the Change
      Control Document.  Such offer will be irrevocable for five
      business days following the date of receipt of the offer by
      FC.

              

      

      

      
        	
                A-1-6.

              	
                Acceptance
      by FC.  If
      FC accepts EDS’ offer by acknowledging such acceptance in writing on the
      Change Control Document, the Change Control Document will become an
      amendment to the affected Work Order and will be binding on both
      Parties.  Each Change Control Document will be numbered
      sequentially per Work Order and will be logged and tracked by EDS as part
      of the EDS Services.

              

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
B

      Confidentiality

      

      

      
        	
                B-1.

              	
                Scope
      of Obligation.  Except
      as otherwise expressly provided in this Agreement, EDS and FC each agrees
      that (a) all information communicated to it by the other and identified as
      confidential, whether before or after the date hereof, (b) all information
      identified as confidential to which it has access in connection with the
      EDS Services, whether before or after the date hereof, and (c) this
      Agreement and the Parties' rights and obligations hereunder, will be and
      will be deemed to have been received in confidence and will be used only
      for purposes of this Agreement, and each of EDS and FC agrees to use the
      same means as it uses to protect its own confidential information, but in
      no event less than reasonable means, to prevent the disclosure and to
      protect the confidentiality thereof.   No such information
      will be disclosed by the recipient Party without the prior written consent
      of the other Party; provided, however, that
      each Party may disclose this Agreement and the other Party's confidential
      information to those of the recipient Party's attorneys, auditors,
      insurers (if applicable), subcontractors  and employees who have
      a need to have access to such information in connection with their
      employment (or engagement, if applicable) by the recipient Party, so long
      as the recipient Party advises each such attorney, auditor, insurer,
      subcontractor and employee of the confidentiality obligations set forth in
      this Exhibit
      B.  In any event, compliance by each of the persons
      referenced in the preceding sentence with the confidentiality obligations
      set forth in this Exhibit B will
      remain the responsibility of the Party employing or engaging such
      persons.  Notwithstanding the foregoing, EDS may disclose this
      Agreement and other confidential information to which it has access
      hereunder to professional advisers, financial institutions and other third
      parties in connection with any proposed transaction to provide financing
      related to this Agreement or the obligations of EDS hereunder, so long as
      each of them execute a confidentiality agreement containing terms and
      conditions no less restrictive than those set forth in this Exhibit
      B.

              

      

      

      
        	
                B-2.

              	
                Exceptions.  The
      foregoing will not prevent either Party from disclosing or using
      information (other than FC Personal Data) that belongs to such Party or
      (i) is already known by the recipient Party without an obligation of
      confidentiality other than under this Agreement, (ii) is publicly known or
      becomes publicly known through no unauthorized act of the recipient Party,
      (iii) is rightfully received from a third party, (iv) is independently
      developed without use of the other Party's confidential information (v) is
      disclosed without similar restrictions to a third party by the Party
      owning the confidential information, or (vi) is disclosed to others in
      accordance with the terms of prior written authorization of the disclosing
      Party.  If confidential information is required to be disclosed
      pursuant to a requirement of a governmental authority, such confidential
      information may be disclosed pursuant to such requirement so long as the
      Party required to disclose the confidential information, to the extent
      possible, provides the other Party with timely prior notice of such
      requirement and coordinates with such other Party in an effort to limit
      the nature and scope of such required disclosure.  In addition,
      and notwithstanding anything to the contrary in this Agreement, each Party
      may disclose to taxing authorities and to such Party’s representatives,
      outside counsel and advisors, any confidential information that is
      required to be disclosed in connection with such Party’s tax filings,
      reports, claims, audits or litigation without prior notice to, or approval
      or consent of, the other Party.  If confidential information is
      required to be disclosed in connection with the conduct of any mediation
      or arbitration proceeding carried out pursuant to Section 10 of
      this Agreement, such confidential information may be disclosed pursuant to
      and in accordance with the approval and at the direction of the mediator
      or arbitrators, as the case may be, conducting such
      proceeding.  In addition, the results of any such mediation or
      arbitration are confidential and will be subject to this Exhibit
      B.  Unless otherwise required by applicable law, upon
      written request of the disclosing Party at the expiration or termination
      of this Agreement and all Work Orders for any reason, all documented
      confidential information (and all copies thereof) of the disclosing Party
      will be returned to the disclosing Party or will be destroyed, with
      written certification thereof being given to the disclosing
      Party.  The provisions of this Exhibit B will
      survive the expiration or termination of this Agreement and each Work
      Order for any reason.

              

      

      
        
          
             

             

          

           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
C

      Representations,
Warranties and Additional Covenants

      

      

      
        	
                C-1.

              	
                Performance.  EDS
      represents and warrants that all EDS Services will be performed in a
      professional manner by personnel with training and experience appropriate
      to the responsibilities they are to perform.  Notwithstanding
      the foregoing, (a) in all cases where EDS has committed to a specific
      service level in an Work Order and where there is a conflict between that
      service level and a service level obligation under this Section C-1,
      the specific service level will apply, and (b) in all cases where EDS has
      not committed to a specific performance standard for certain of the EDS
      Services, EDS will use reasonable care in providing such EDS
      Services.

              

      

      

      
        	
                C-2.

              	
                [RESERVED]

              

      

      

      
        	
                C-3.

              	
                Authorization.  Each
      Party represents and warrants to the other
that:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                It
      is duly formed, validly existing and in good standing under the laws of
      its jurisdiction of formation;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                It
      has the requisite power and authority to execute, deliver and perform its
      obligations under this Agreement;

              

      

      

      
        	
                 
      

              	
                (c)

              	
                It
      has obtained all licenses, authorizations, approvals, consents or permits
      required to perform its obligations under this Agreement and each Work
      Order and to grant access to the other Party to systems and information as
      provided in this Agreement and each Work Order under all applicable
      federal, state, provincial or local laws and under all applicable rules
      and regulations of all authorities having jurisdiction over the EDS
      Services, except where the failure of a Party to so obtain any such item
      is not material to such Party’s ability to perform its obligations
      hereunder.

              

      

      

      
        	
                 
      

              	
                (d)

              	
                The
      execution, delivery and performance of this Agreement and each Work Order
      and the consummation of the transactions contemplated hereby and thereby
      have been duly authorized by the requisite corporate action on the part of
      such Party.

              

      

      

      
        	
                 
      

              	
                (e)

              	
                The
      execution, delivery and performance of this Agreement and each Work Order
      will not constitute a violation of any judgment, order or decree, a
      material default under any material contract by which it or any of its
      material assets are bound or an event that would, with notice or lapse of
      time, or both, constitute such a
default.

              

      

      

      
        	
                C-4.

              	
                No
      Inducements.  EDS
      has not violated any FC policy made available to EDS regarding the
      offering of inducements in connection with this Agreement or any Work
      Order.

              

      

      

      
        	
                C-5.

              	
                Viruses.  Each Party
      will use commercially reasonable measures to screen any software provided
      or made available by it to the other Party hereunder for the purpose of
      avoiding the introduction of any “virus” or other computer software
      routine or hardware components which are designed (i) to permit access or
      use by third parties to the software of the other Party not authorized by
      this Agreement, (ii) to disable or damage hardware or damage, erase
      or delay access to software or data of the other Party or (iii) to perform
      any other similar actions.  If a virus is found to have been
      introduced into FC’s systems or the systems used to provide the EDS
      Services as a result of a breach of the foregoing covenant, EDS will use
      commercially reasonable efforts, at no additional charge, to reasonably
      assist FC (within the scope of the EDS Services) (a) in eradicating the
      virus and reversing its effects and (b) to the extent the virus causes a
      loss of data or operational efficiency as a result of a breach of the
      foregoing covenant, in mitigating and reversing such
    losses.

              

      

      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

      

      
        	
                C-6.

              	
                Disabling
      Codes.  EDS will
      not, without informing FC’s representative, knowingly insert into the
      software used by it hereunder any code or other device which would have
      the effect of disabling, damaging, erasing, delaying or otherwise shutting
      down all or any portion of the EDS Services or the hardware, software or
      data used in providing the EDS Services.  EDS will not invoke
      such code or other device at any time, including upon expiration or
      termination of this Agreement for any reason, without FC’s prior written
      consent.

              

      

      

      
        	
                C-7.

              	
                Use
      of Software.  EDS
      has sufficient right, title and interest in and to all EDS software
      provided by EDS and used in connection with the EDS
      Services.  FC’s sole remedy for breach of this Section C-7 is
      through the indemnity set forth in Section
      D-3.

              

      

      

      
        	
                C-8.

              	
                Disclaimer.  EXCEPT AS OTHERWISE EXPRESSLY
      PROVIDED IN THIS EXHIBIT
      C OR THE AGREEMENT
      TO WHICH THIS EXHIBIT
      C IS ATTACHED, EDS
      MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING ANY
      MATTER, INCLUDING THE MERCHANTABILITY, SUITABILITY, ORIGINALITY, FITNESS
      FOR A PARTICULAR USE OR PURPOSE, OR RESULTS TO BE DERIVED FROM THE USE, OF
      ANY SERVICE, SOFTWARE, HARDWARE OR OTHER MATERIALS PROVIDED UNDER THIS
      AGREEMENT, OR  THAT THE OPERATION OF ANY SUCH SERVICE, SOFTWARE,
      HARDWARE OR OTHER MATERIALS WILL BE UNINTERRUPTED OR
      ERROR-FREE.

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
D

      Indemnities

      

      

      
        	
                D-1.

              	
                Claims
      Relating to Space and Taxes.  Subject
      to Section
      13 of this Agreement and the procedures set forth below in Section D-6,
      EDS and FC each agrees to indemnify and defend the other Party from any
      and all claims, actions, damages, liabilities, costs and expenses,
      including reasonable attorneys’ fees and expenses (collectively,
      “Losses”), arising out of, under or in connection with (a) any third party
      claim for rent or utilities at any location where the indemnitor is
      financially responsible under this Agreement for such rent or utilities or
      (b) any third party claim for wages, benefits, third party fees, taxes,
      assessments, duties, permits or other charges of any nature for which the
      indemnitor is responsible under this Agreement, as well as penalties,
      interest, fees or other expenses incurred by the indemnitor as a result of
      such items, including taxes, not being paid at the time or in the manner
      required by applicable law.

              

      

      

      
        	
                D-2.

              	
                Claims Relating to
      Personal Injury and Property
Damage.

              

      

      

      
        	
                (a)  

              	
                Damage
      to Property of Parties.  EDS
      and FC each will be responsible for any and all Losses, to their
      respective tangible personal or real property (whether owned or leased),
      and each Party agrees to look only to its own insuring arrangements (if
      any) with respect to such Losses.

              

      

      

      
        	
                (b)  

              	
                Personal
      Injury; Damage to Property of Third Parties.  EDS
      and FC each will be responsible for Losses for the death of or personal
      injury to any person (including any employee of either Party) and Losses
      for damages to any third party’s tangible personal or real property
      (whether owned or leased), in accordance with the law of the jurisdiction
      in which such Loss is alleged to have occurred.  Subject to
      Section
      13 of this Agreement and the procedures set forth below in Section D-6,
      each Party will indemnify and defend the other Party from any and all
      Losses arising out of, under or in connection with third party claims for
      which the indemnitor is responsible under this Section
      D-2(b).

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Waiver
      of Subrogation.  To
      the extent permitted at no additional cost, EDS and FC waive all rights to
      recover against each other for any Loss to their respective tangible
      personal property (whether owned or leased) from any cause covered by
      insurance maintained by each of them, including their respective
      deductibles or self-insured retentions.  EDS and FC will cause
      their respective insurers to issue appropriate waivers of subrogation
      rights endorsements to all property insurance policies maintained by each
      Party.  Each Party will give the other written notice if a
      waiver of subrogation is unobtainable or obtainable only at additional
      expense.  If the Party receiving such notice agrees to reimburse
      the other Party for such additional expense, the other Party will obtain
      such waiver of subrogation.  If a waiver is unobtainable or if a
      Party elects not to pay the additional expense of a waiver, then neither
      Party nor their insurers will waive such subrogation
    rights.

              

      

      

      
        	
                 
      

              	
                D-3.

              	
                Infringement
      Claims.

              

      

      

      

      
        	
                 
      

              	
                (a)

              	
                General.  Subject
      to Section
      13 of this Agreement, the exclusions and limitations set forth
      below in this Section D-3 and
      the procedures set forth below in Section D-6,
      EDS and FC each agrees to defend the other Party against any third party
      action to the extent that such action is based upon a claim that the
      software (other than third party software) or confidential information
      provided by the indemnitor, or any part thereof, (i) infringes a copyright
      perfected under United States statute, (ii) infringes a patent granted
      under United States law or (iii) constitutes an unlawful disclosure,
      use or misappropriation of another party's trade secret.  The
      indemnitor will bear the expense of such defense and pay any Losses that
      are attributable to such claim finally awarded by a court of competent
      jurisdiction.

              

      

      
        
          
             

             

          

           

        

        
           

          
            

          

        

        
           

        

      

      

      
        	
                (b)  

              	
                Exclusions.  The
      indemnitor will have no liability to the indemnitee hereunder if (i) the
      claim of infringement is based upon the use of software provided by the
      indemnitor hereunder in connection or in combination with equipment,
      devices or software not supplied by the indemnitor or used in a manner for
      which the software was not designed, (ii) the indemnitee modifies any
      software provided by the indemnitor hereunder and such infringement would
      not have occurred but for such modification, or uses the software in the
      practice of a patented process and there would be no infringement in the
      absence of such practice, or (iii) the claim of infringement arises out of
      the indemnitor's compliance with specifications provided by the indemnitee
      and such infringement would not have occurred but for such
      compliance.  In addition, EDS will only be liable to FC for
      claims of infringement arising out of, under or in connection with, gross
      negligence by EDS in the provision of help desk services, call center
      services or automated attendant services involving computer telephony
      integration.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Additional
      Remedy.  If
      software or confidential information becomes the subject of an
      infringement claim under this Section D-3, or
      in the indemnitor’s opinion is likely to become the subject of such a
      claim, then, in addition to defending the claim and paying any damages and
      attorneys’ fees as required above in this Section D-3,
      the indemnitor may, at its option and in its sole discretion, (A) replace
      or modify the software or confidential information to make it
      noninfringing or cure any claimed misuse of another’s trade secret or (B)
      procure for the indemnitee the right to continue using the software or
      confidential information pursuant to this Agreement.  Any costs
      associated with implementing either of the above alternatives will be
      borne by the indemnitor but will be subject to Section 13 of
      this Agreement.  If neither alternative is pursued by, or (if
      pursued) available to, the indemnitor, (x) the indemnitee will return such
      software or confidential information to the indemnitor and (y) if
      requested by the indemnitee in good faith, the Parties will negotiate,
      pursuant to Section 10 of
      this Agreement but subject to Section 13 of
      this Agreement, to reach a written agreement on what, if any, monetary
      damages (in addition to the indemnitor’s obligation to defend the claim
      and pay any damages and attorneys’ fees as required above in this Section D-3)
      are reasonably owed by the indemnitor to the indemnitee as a result of the
      indemnitee no longer having use of such software or confidential
      information.  The payment of any such monetary damages will be
      the indemnitee’s sole and exclusive remedy for the inability of the
      indemnitor to implement either of the above
  alternatives.

              

      

      

      
        	
                 
      

              	
                D-4.

              	
                Claims
      Relating to Internet Usage.  FC warrants that the
      publication of any material delivered by or through it under this
      Agreement or any Work Order will not violate the copyright laws of the
      United States or any other jurisdiction, unlawfully infringe or interfere
      in any way with the literary property or rights of another or contain
      libelous or indecent matter.  FC will indemnify and defend EDS
      from any and all Losses, including those associated with claims for
      indirect or contributory infringement, arising out of, under or in
      connection with any third party claims relating to (i) content, whether of
      an editorial, advertising or other nature, (ii) the provision, use,
      alteration or distribution thereof, the accessibility thereto or the
      exchange of information over the Internet in connection therewith,
      including copyright infringement, libel, indecency, false light,
      misrepresentation, invasion of privacy or image or personality rights,
      (iii) statements or other materials made or made available by readers of
      the content or by persons to whom the content is linked at the request of
      FC or (iv) the conduct of FC’s
business.

              

      

      

      
        	
                D-5.

              	
                Procedures.  The
      indemnification obligations set forth in this Exhibit D will
      not apply unless the Party claiming indemnification:  (a)
      notifies the other promptly in writing of any matters in respect of which
      the indemnity may apply and of which the notifying Party has knowledge, in
      order to allow the indemnitor the opportunity to investigate and defend
      the matter; provided, however, that
      the failure to so notify will only relieve the indemnitor of its
      obligations under this Exhibit D if
      and to the extent that the indemnitor is prejudiced thereby; and (b) gives
      the other Party full opportunity to control the response thereto and the
      defense thereof, including any agreement relating to the settlement
      thereof; provided, however, that
      the indemnitee will have the right to participate in any legal proceeding
      to contest and defend a claim
for

              

      

      
        
          
             

             

          

           

        

        
           

          
            

          

        

        
           

        

      

      indemnification
involving a third party and to be represented by legal counsel of its choosing,
all at the indemnitee’s cost and expense.  However, if the indemnitor
fails to promptly assume the defense of the claim, the Party entitled to
indemnification may assume the defense at the indemnitor’s cost and
expense.  The indemnitor will not be responsible for any settlement or
compromise made without its consent, unless the indemnitee has tendered notice
and the indemnitor has then refused to assume and defend the claim and it is
later determined that the indemnitor was liable to assume and defend the
claim.  The indemnitee agrees to cooperate in good faith with the
indemnitor at the request and expense of the
indemnitor.

Back to Main
Documentexhibit101111408.htm

    EXHIBIT
10.1

     

    FIRST AMENDMENT TO
REGISTRATION RIGHTS AGREEMENT

     

    

    This
FIRST AMENDMENT (the “Amendment”) to the
Registration Rights Agreement is made and entered into as of November 12, 2008,
by and among ISCO International, Inc., a Delaware corporation (the “Company”), Alexander
Finance, L.P., an Illinois limited partnership (“Alexander”), and
Manchester Securities Corp., a New York corporation (“Manchester”).

     

    W
I T N E S S E T H:

     

    WHEREAS, on August 18, 2008,
the Company, Alexander, and Manchester entered into that certain Registration
Rights Agreement (the “Registration Rights
Agreement”); and

    

    WHEREAS, the parties desire to
amend the Registration Rights Agreement to provide for certain changes as more
fully set forth herein.

    

    A
G R E E M E N T:

     

    NOW, THEREFORE, in
consideration of the covenants and agreements herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

    

    1. Definitions.  All
capitalized terms used herein and not defined or amended herein shall have the
meanings ascribed to them in the Registration Rights Agreement.

    

    2. Amendments.  The
parties hereby agree to amend the Registration Rights Agreement as
follows:

    

    
      	
              a)  

            	
              Replace
      Section
      2(a)(i) in its entirety with the
  following:

            

    

    

    “But in
any event before June 1, 2009, prepare and file a registration statement with
the Commission pursuant to Rule 415 under the Securities Act on Form S-3 under
the Securities Act (or in the event that the Company is ineligible to use such
form, such other form as the Company is eligible to use under the Securities Act
provided that such other form shall be converted into a Form S-3 as soon as Form
S-3 becomes available to the Company) covering resales by the Holders as selling
stockholders (not underwriters) of the Registrable Securities and, to the extent
practicable, no other securities (the “Registration
Statement”), which Registration Statement, to the extent allowable under
the Securities Act and the rules promulgated thereunder (including Rule 416),
shall state that such Registration Statement also covers the resale of such
indeterminate number of additional shares of Common Stock as may be issued upon
conversion of the Notes by reason of stock splits, stock dividends or similar
transactions.  The number of shares of Common Stock initially included
in such Registration Statement shall be no less than 15,000,000 and the Company
shall amend such Registration Statement or file additional Registration
Statements to cover the number of additional shares of Common Stock that may be
issued or issuable pursuant to the terms of the Notes in the event that the
number of shares of Common Stock initially registered is
insufficient.  Nothing in the preceding sentence will limit the
Company’s obligations to reserve shares of Common Stock pursuant to Section 3(d)
of the Notes.  Thereafter the Company shall use its best efforts to
cause such Registration Statement and other filings to be declared effective as
soon as possible, and in any event before September 1, 2009 (or, if the SEC
elects to review the Registration Statement, before November 1, 2009) (the “Effectiveness
Deadline”).  Without limiting the foregoing, the Company will
promptly respond to all SEC comments, inquiries and requests, and shall request
acceleration of effectiveness at the earliest possible date.

    

    Notwithstanding
the foregoing, at any time after March 31, 2009, either Lender may demand by
written notice to the Company (a “Demand Notice”), that
the Company prepare and file the Registration Statement as soon as possible
following the date of the Demand Notice (the “Demand Date”), but
not later than the date that is 30 days following the Demand Date (which date
may be earlier than June 1, 2009).  Thereafter, the Company
shall use its best efforts to cause the Registration Statement to be declared
effective as soon as possible, but not later than 60 days from the Demand Date
(the “Demand
Effectiveness Deadline”).”

    

    
      	
              b)  

            	
              Replace
      Section
      2(b)(i)(A) in its entirety with the
  following:

            

    

    

    “In the
event that such Registration Statement has not been declared effective
by the Effectiveness Deadline or the Demand Effectiveness Deadline as
applicable, or the Company at any time fails to issue unlegended Registrable
Securities to the extent required by Article 5 of the Loan Agreement, then the
Company shall pay each Holder (other than (i) in the case of a Registration
Statement not declared effective, a Holder of Registrable Securities that the
Company could exclude from registration in accordance with Section 9 and (ii) in
the case of a failure to issue unlegended certificates in accordance with the
Loan Agreement, a Holder that is not a party to, including as a permitted
assignee bound to, the Loan Agreement) a Monthly Delay Payment (as defined
below) with respect to each successive 30-day period (or portion thereof
appropriately prorated) thereafter that effectiveness of the Registration
Statement is delayed or failure to issue such unlegended Registrable Securities
persists.”

    

    
      	
              c)  

            	
              Replace
      Section
      2(b)(ii)(A) in its entirety with the
  following:

            

    

    

    “In the
event that the Company fails, refuses or for any other reason is unable to cause
the Registrable Securities covered by the Registration Statement to be listed
(subject to issuance) with the Principal Market (as defined in the Notes) at all
times during the period (“Listing Period”) from
the date (“Effectiveness Commencement
Date”) which is the earlier of the effectiveness of the Registration
Statement and September 1, 2009 (or, if the SEC elects to review the
Registration Statement, November 1, 2009) until such time as the registration
period specified in Section 5 terminates, then the Holder shall have available
the remedies set forth in Section 4(b) of the Notes.”

    

    3.           Entire Agreement;
Amendment.  This Registration Rights Agreement, as amended
hereby, together with the Loan Agreement, the Notes and the agreements and
documents contemplated hereby and thereby, contains the entire understanding and
agreement of the parties.

    

    4.           Governing
Law.  This Amendment shall be construed in accordance with and
governed by the internal laws of the State of New York, without regard to choice
of laws principles.

    

    5.           Counterparts.  This
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which, when so executed and delivered,
shall be deemed an original, but all of which counterparts together shall
constitute but one agreement.

    

    6.           Full Force and
Effect.  Except as specifically modified or amended by the
terms of this Amendment, the Registration Rights Agreement and all provisions
contained therein are, and shall continue, in full force and
effect.

    

    

    

    {Signature
Page Follows}

    
      
        
           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
undersigned have caused this Amendment to be duly executed as of the date first
written above.

     

    

    ISCO
INTERNATIONAL, INC.

    

    By: /s/ Gary
Berger                                                      

    Name:
Gary Berger

    Its:           Chief
Financial Officer

    

    

    ALEXANDER
FINANCE, L.P.

    

    By: /s/ Bradford T.
Whitmore

    Name:
Bradford T. Whitmore

     President, Bun Partners,
Inc.

    Its:           General
Partner

    

    

    MANCHESTER
SECURITIES CORPORATION

    

    By: /s/ Elliot
Greenberg                                                      

    Name:      Elliot
Greenberg

    Its:           Vice
President

    
      
        
          [Signature
Page to First Amendment to Registration Rights Agreement]

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