Document:

Form of Warrant

                                                                      Exhibit
    10.37

    

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
      DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
      STATE SECURITIES LAWS OR COMMUNICATION INTELLIGENCE CORPORATION SHALL HAVE
      RECEIVED AN OPINION OF COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE
      SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS
      IS
      NOT REQUIRED.

    

    WARRANT
      TO PURCHASE

    

    SHARES
      OF
      COMMON STOCK

    

    OF

    

    COMMUNICATION
      INTELLIGENCE CORPORATION

    

    

    Expires:
      ______________, 200X

    

    No.:
      W2007- __Number
      of
      Shares: ___________

    Date
      of
      Issuance: ___________, 200X

    

    

    FOR
      VALUE
      RECEIVED, subject to the provisions hereinafter set forth, the undersigned,
      Communication Intelligence Corporation, a Delaware corporation (together with
      its successors and assigns, the "Issuer"),
      hereby certifies that _______________________________ or its registered assigns
      is entitled to subscribe for and purchase, during the Term (as hereinafter
      defined), up to ____________________________________ (_____________) shares
      (subject to adjustment as hereinafter provided) of the duly authorized, validly
      issued, fully paid and non-assessable Common Stock of the Issuer, at an exercise
      price per share equal to the Warrant Price then in effect, subject, however,
      to
      the provisions and upon the terms and conditions hereinafter set forth.
      Capitalized terms used in this Warrant and not otherwise defined herein shall
      have the respective meanings specified in Section 8 hereof.

    

    1. Term.
      The
      term of this Warrant shall commence on _______, 200X [date
      of
      issuance, but no earlier than June 30, 2007]
      and
      shall expire at 5:00 p.m., eastern time, on _________, 200X [3
      years
      after commencing date]
      (such
      period being the "Term").
      

    

    
      	2.  	
              Method
                of Exercise; Payment; Issuance of New Warrant; Transfer and
                Exchange.

            

    

    

    (a) Time
      of Exercise.
      The
      purchase rights represented by this Warrant may be exercised in whole or in
      part
      at any time during the Term. 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b) Method
      of Exercise.
      The
      Holder hereof may exercise this Warrant, in whole or in part, by the surrender
      of this Warrant (with the exercise form attached hereto duly executed) at the
      principal office of the Issuer, and by the payment to the Issuer of an amount
      of
      consideration therefor equal to the Warrant Price in effect on the date of
      such
      exercise multiplied by the number of shares of Warrant Stock with respect to
      which this Warrant is then being exercised, payable at such Holder's election
      by
      certified or official bank check or by
      wire
      transfer to an account designated by the Issuer.

    

    (c) Issuance
      of Stock Certificates.
      In the
      event of any exercise of the rights represented by this Warrant in accordance
      with and subject to the terms and conditions hereof, (i) certificates for the
      shares of Warrant Stock so purchased shall be dated the date of such exercise
      and delivered to the Holder hereof within a reasonable time after such exercise,
      and the Holder hereof shall be deemed for all purposes to be the holder of
      the
      shares of Warrant Stock so purchased as of the date of such exercise and (ii)
      unless this Warrant has expired, a new Warrant representing the number of shares
      of Warrant Stock, if any, with respect to which this Warrant shall not then
      have
      been exercised (less any amount thereof which shall have been canceled in
      payment or partial payment of the Warrant Price as hereinabove provided) shall
      also be issued to the Holder hereof at the Issuer's expense within such
      time.

    

    (d) Transferability
      of Warrant.
      Subject
      to Section 2(e), this Warrant may be transferred by a Holder without the consent
      of the Issuer. If transferred pursuant to this paragraph and subject to the
      provisions of Section 2(e), this Warrant may be transferred on the books of
      the
      Issuer by the Holder hereof in person or by duly authorized attorney, upon
      surrender of this Warrant at the principal office of the Issuer, properly
      endorsed (by the Holder executing an assignment in the form attached hereto)
      and
      upon payment of any necessary transfer tax or other governmental charge imposed
      upon such transfer. This Warrant is exchangeable at the principal office of
      the
      Issuer for Warrants to purchase the same aggregate number of shares of Warrant
      Stock, each new Warrant to represent the right to purchase such number of shares
      of Warrant Stock as the Holder hereof shall designate at the time of such
      exchange. All Warrants issued upon a transfer or exchange shall be dated the
      Original Issue Date and shall be identical with this Warrant except as to the
      number of shares of Warrant Stock issuable pursuant hereto.

    

    (e) Compliance
      with Securities Laws.

    

    (i) The
      Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant
      or
      the shares of Warrant Stock to be issued upon exercise hereof, as applicable,
      are being acquired for the Holder's own account and not as a nominee for any
      other party, and for investment, and that the Holder will not offer, sell or
      otherwise dispose of this Warrant or any shares of Warrant Stock to be issued
      upon exercise hereof, except pursuant to an effective registration statement,
      or
      an exemption from registration, under the Securities Act and any applicable
      state securities laws.

    

    (ii) Except
      as
      provided in Section 2(e)(iii), this Warrant and all certificates representing
      shares of Warrant Stock issued upon exercise hereof shall be stamped or
      imprinted with a legend in substantially the following form:

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT"), OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR
      OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
      APPLICABLE STATE SECURITIES LAWS OR COMMUNICATION INTELLIGENCE CORPORATION
      SHALL
      HAVE RECEIVED AN OPINION OF COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER
      THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES
      LAWS
      IS NOT REQUIRED.

    

    (iii) The
      Issuer agrees to reissue this Warrant or certificates representing any of the
      Warrant Stock, without the legend set forth above if at such time, prior to
      making any transfer of any such securities, the Holder shall give written notice
      to the Issuer describing the manner and terms of such transfer and removal
      as
      the Issuer may reasonably request. Such proposed transfer and removal will
      not
      be effected until: (a) either (i) the Issuer has received an opinion of counsel
      reasonably satisfactory to the Issuer, to the effect that the registration
      of
      such securities under the Securities Act is not required in connection with
      such
      proposed transfer, (ii) a registration statement under the Securities Act
      covering such proposed disposition has been filed by the Issuer with the
      Securities and Exchange Commission and has become effective under the Securities
      Act, (iii) the Issuer has received other evidence reasonably satisfactory to
      the
      Issuer that such registration and qualification under the Securities Act and
      state securities laws are not required, or (iv) the Holder provides the Issuer
      with reasonable assurances that such security can be sold pursuant to Rule
      144
      under the Securities Act; and (b) either (i) the Issuer has received an opinion
      of counsel reasonably satisfactory to the Issuer, to the effect that
      registration or qualification under the securities or "blue sky" laws of any
      state is not required in connection with such proposed disposition, or (ii)
      compliance with applicable state securities or "blue sky" laws has been effected
      or a valid exemption exists with respect thereto. The Issuer will respond to
      any
      such notice from the Holder within five (5) business days. In the case of any
      proposed transfer under this Section 2(e), the Issuer will use reasonable best
      efforts to comply with any such applicable state securities or "blue sky" laws,
      but shall in no event be required, (x) to qualify to do business in any state
      where it is not then qualified, or (y) to take any action that would subject
      it
      to tax or to the general service of process in any state where it is not then
      subject. The restrictions on transfer contained in this Section 2(e) shall
      be in
      addition to, and not by way of limitation of, any other restrictions on transfer
      contained in any other section of this Warrant. Whenever
      a
      certificate representing the Warrant Stock is required to be issued to a Holder
      without a legend, in lieu of delivering physical certificates representing
      the
      Warrant Stock, provided the Issuer’s transfer agent is participating in the DTC
      Fast Automated Securities Transfer program, the Issuer shall use its reasonable
      best efforts to cause its transfer agent to electronically transmit the Warrant
      Stock to the Holder by crediting the account of the Holder's Prime Broker with
      DTC through DWAC (to the extent not inconsistent with any provisions of this
      Warrant or the Purchase Agreement). 

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    3. Stock
      Fully Paid; Reservation and Listing of Shares; Covenants.

    

    (a) Stock
      Fully Paid.
      The
      Issuer represents, and warrants to the Holder, and covenants and agrees for
      the
      benefit of the Holder that all shares of Warrant Stock which may be issued
      upon
      the exercise of this Warrant or otherwise hereunder will, upon issuance, be
      duly
      authorized, validly issued, fully paid and non-assessable and free from all
      taxes, liens, charges or other encumbrances of any nature whatsoever created
      by
      or through the Issuer. The Issuer further covenants and agrees that during
      the
      period within which this Warrant may be exercised, the Issuer will at all times
      have authorized and reserved for the purpose of the issue upon exercise of
      this
      Warrant a sufficient number of shares of Common Stock to provide for the
      exercise of this Warrant.

    

    (b) Reservation.
      If any
      shares of Common Stock required to be reserved for issuance upon exercise of
      this Warrant or as otherwise provided hereunder require registration or
      qualification with any governmental authority under any federal or state law
      before such shares may be so issued, the Issuer will in good faith use its
      best
      efforts at its expense to cause such shares to be duly registered or qualified.
      If the Issuer shall list any shares of Common Stock on any securities exchange
      or market it will, at its expense, list thereon, maintain and increase when
      necessary such listing, of, all shares of Warrant Stock from time to time issued
      upon exercise of this Warrant or as otherwise provided hereunder (provided
      that
      such Warrant Stock has been registered pursuant to a registration statement
      under the Securities Act then in effect), and, to the extent permissible under
      the applicable securities exchange rules, all unissued shares of Warrant Stock
      which are at any time issuable hereunder, so long as any shares of Common Stock
      shall be so listed. The Issuer will also so list on each securities exchange
      or
      market, and will maintain such listing of, any other securities which the Holder
      of this Warrant shall be entitled to receive upon the exercise of this Warrant
      if at the time any securities of the same class shall be listed on such
      securities exchange or market by the Issuer.

    

    (c) Covenants.
      The
      Issuer shall not by any action including, without limitation, amending the
      Certificate of Incorporation or the by-laws of the Issuer, or through any
      reorganization, transfer of assets, consolidation, merger, dissolution, issue
      or
      sale of securities or any other action, avoid or seek to avoid the observance
      or
      performance of any of the terms or provisions of this Warrant, but will at
      all
      times in good faith assist in the carrying out of all such terms and in the
      taking of all such actions as may be necessary or appropriate to protect the
      rights of the Holder hereof against dilution (to the extent specifically
      provided herein) or impairment. Without limiting the generality of the
      foregoing, the Issuer will (i) not permit the par value, if any, of its Common
      Stock to exceed the then effective Warrant Price, (ii) not amend or modify
      any
      provision of the Certificate of Incorporation or by-laws of the Issuer in any
      manner that would adversely affect the rights of the Holder of this Warrant,
      (iii) take all such action as may be reasonably necessary in order that the
      Issuer may validly and legally issue fully paid and nonassessable shares of
      Common Stock, free and clear of any liens, claims, encumbrances and restrictions
      (other than as provided herein) upon the exercise of this Warrant, and (iv)
      use
      its best efforts to obtain all such authorizations, exemptions or consents
      from
      any public regulatory body having jurisdiction thereof as may be reasonably
      necessary to enable the Issuer to perform its obligations under this
      Warrant.

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (d) Loss,
      Theft, Destruction of Warrants.
      Upon
      receipt of evidence satisfactory to the Issuer of the ownership of and the
      loss,
      theft, destruction or mutilation of any Warrant and, in the case of any such
      loss, theft or destruction, upon receipt of indemnity or security reasonably
      satisfactory to the Issuer or, in the case of any such mutilation, upon
      surrender and cancellation of such Warrant, the Issuer will make and deliver,
      in
      lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of
      like
      tenor and representing the right to purchase the same number of shares of Common
      Stock.

    

    4. Adjustment
      of Warrant Price and Warrant Share Number.
      The
      number of shares of Common Stock for which this Warrant is exercisable, and
      the
      price at which such shares may be purchased upon exercise of this Warrant,
      shall
      be subject to adjustment from time to time as set forth in this Section 4.
      The
      Issuer shall give the Holder notice of any event described below which requires
      an adjustment pursuant to this Section 4 in accordance with Section 5.

    

    (a) Recapitalization,
      Reorganization, Reclassification, Consolidation, Merger or Sale.

     

    (i)
      In
      case the Issuer after the Original Issue Date shall do any of the following
      (each, a "Triggering
      Event"):
      (a)
      consolidate with or merge into any other Person and the Issuer shall not be
      the
      continuing or surviving corporation of such consolidation or merger, or (b)
      permit any other Person to consolidate with or merge into the Issuer and the
      Issuer shall be the continuing or surviving Person but, in connection with
      such
      consolidation or merger, any Capital Stock of the Issuer shall be changed into
      or exchanged for Securities of any other Person or cash or any other property,
      or (c) transfer all or substantially all of its properties or assets to any
      other Person, or (d) effect a capital reorganization or reclassification of
      its
      Capital Stock, then, and in the case of each such Triggering Event, proper
      provision shall be made so that, upon the basis and the terms and in the manner
      provided in this Warrant, the Holder of this Warrant shall be entitled upon
      the
      exercise hereof at any time after the consummation of such Triggering Event,
      to
      the extent this Warrant is not exercised prior to such Triggering Event, to
      receive at the Warrant Price in effect at the time immediately prior to the
      consummation of such Triggering Event in lieu of the Common Stock issuable
      upon
      such exercise of this Warrant prior to such Triggering Event, the Securities,
      cash and property to which such Holder would have been entitled upon the
      consummation of such Triggering Event if such Holder had exercised the rights
      represented by this Warrant immediately prior thereto, subject to adjustments
      (subsequent to such corporate action) as nearly equivalent as possible to the
      adjustments provided for elsewhere in this Section 4.

    

    (ii) Notwithstanding
      anything contained in this Warrant to the contrary, a Triggering Event shall
      not
      be deemed to have occurred if, prior to the consummation thereof, each Person
      (other than the Issuer) which may be required to deliver any Securities, cash
      or
      property upon the exercise of this Warrant as provided herein shall assume,
      by
      written instrument delivered to, and reasonably satisfactory to, the Holder
      of
      this Warrant, (A) the obligations of the Issuer under this Warrant (and if
      the
      Issuer shall survive the consummation of such Triggering Event, such assumption
      shall be in addition to, and shall not release the Issuer from, any continuing
      obligations of the Issuer under this Warrant) and (B) the obligation to deliver
      to such Holder such Securities, cash or property as, in accordance with the
      foregoing provisions of this subsection (a), such 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Holder
      shall be entitled to receive, and such Person shall have similarly delivered
      to
      such Holder an opinion of counsel for such Person, which counsel shall be
      reasonably satisfactory to such Holder, or in the alternative, a written
      acknowledgement executed by the President or Chief Financial Officer of the
      Issuer, stating that this Warrant shall thereafter continue in full force and
      effect and the terms hereof (including, without limitation, all of the
      provisions of this subsection (a)) shall be applicable to the Securities, cash
      or property which such Person may be required to deliver upon any exercise
      of
      this Warrant or the exercise of any rights pursuant hereto. 

    

    (b) Stock
      Dividends, Subdivisions and Combinations.
      If at
      any time the Issuer shall:

    

       (i) take
      a
      record of the holders of its Common Stock for the purpose of entitling them
      to
      receive a dividend payable in, or other distribution of, shares of Common Stock,
      

    

       (ii)
       subdivide
      its outstanding shares of Common Stock into a larger number of shares of Common
      Stock, or

    

       (iii)
       combine
      its outstanding shares of Common Stock into a smaller number of shares of Common
      Stock,

    

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      immediately after the occurrence of any such event shall be adjusted to equal
      the number of shares of Common Stock which a record holder of the same number
      of
      shares of Common Stock for which this Warrant is exercisable immediately prior
      to the occurrence of such event would own or be entitled to receive after the
      happening of such event, and (2) the Warrant Price then in effect shall be
      adjusted to equal (A) the Warrant Price then in effect multiplied by the number
      of shares of Common Stock for which this Warrant is exercisable immediately
      prior to the adjustment divided by (B) the number of shares of Common Stock
      for
      which this Warrant is exercisable immediately after such
      adjustment.

    

    (c) Certain
      Other Distributions.
      If at
      any time the Issuer shall take a record of the holders of its Common Stock
      for
      the purpose of entitling them to receive any divi-dend or other distribution
      of:

    

    (i) cash
      (other than a cash dividend payable out of earnings or earned surplus legally
      available for the payment of dividends under the laws of the jurisdiction of
      incorporation of the Issuer),

    

    (ii) any
      evidences of its indebtedness, any shares of stock of any class or any other
      securities or property of any nature whatsoever (other than cash, Common Stock
      Equivalents or Additional Shares of Common Stock), or

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    (iii) any
      warrants or other rights to subscribe for or purchase any evidences of its
      indebtedness, any shares of stock of any class or any other securities or
      property of any nature whatsoever (other than cash, Common Stock Equivalents
      or
      Additional Shares of Common Stock), 

    

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      shall
      be adjusted to equal the product of the number of shares of Common Stock for
      which this Warrant is exercisable immediately prior to such adjustment
      multiplied by a fraction (A) the numerator of which shall be the Per Share
      Market Value of Common Stock at the date of taking such record and (B) the
      denominator of which shall be such Per Share Market Value minus the amount
      allocable to one share of Common Stock of any such cash so distributable and
      of
      the fair value (as determined in good faith by the Board of Directors of the
      Issuer and supported by an opinion from an investment banking firm of recognized
      national standing acceptable to (but not affiliated with) the Holder) of any
      and
      all such evidences of indebtedness, shares of stock, other securities or
      property or warrants or other subscription or purchase rights so distributable,
      and (2) the Warrant Price then in effect shall be adjusted to equal (A) the
      Warrant Price then in effect multiplied by the number of shares of Common Stock
      for which this Warrant is exercisable immediately prior to the adjustment
      divided by (B) the number of shares of Common Stock for which this Warrant
      is
      exercisable immediately after such adjustment. A reclassification of the Common
      Stock (other than a change in par value, or from par value to no par value
      or
      from no par value to par value) into shares of Common Stock and shares of any
      other class of stock shall be deemed a distribution by the Issuer to the holders
      of its Common Stock of such shares of such other class of stock within the
      meaning of this Section 4(c) and, if the outstanding shares of Common Stock
      shall be changed into a larger or smaller number of shares of Common Stock
      as a
      part of such reclassification, such change shall be deemed a subdivision or
      combination, as the case may be, of the outstanding shares of Common Stock
      within the meaning of Section 4(b). 

     

    (d) Fractional
      Interests.
      In
      computing ad-justments under this Section 4, fractional interests in Common
      Stock shall be taken into account to the near-est one one-hundredth
      (1/100th)
      of a
      share.

    

    (e) When
      Adjustment Not Required.
      If the
      Issuer shall take a record of the holders of its Common Stock for the purpose
      of
      entitling them to receive a dividend or distribution or subscription or purchase
      rights and shall, thereafter and before the distribution to stockholders
      thereof, legally abandon its plan to pay or deliver such dividend, distribution,
      subscription or purchase rights, then thereafter no adjustment shall be required
      by reason of the taking of such record and any such adjustment previously made
      in respect thereof shall be rescinded and annulled.

     

    (f) Form
      of Warrant after Adjustments.
      The
      form of this Warrant need not be changed because of any adjustments in the
      Warrant Price or the number and kind of Securities purchasable upon the exercise
      of this Warrant.

    

    (g) Escrow
      of Warrant Stock.
      If
      after any property becomes distributable pursuant to this Section 4 by reason
      of
      the taking of any record of the holders of Common Stock, but prior to the
      occurrence of the event for which such record is taken, and the Holder
      exer-cises this Warrant, any shares of Common Stock issuable upon exercise
      by
      reason of such adjustment shall be deemed the last shares of Common Stock for
      which this Warrant is exercised (notwithstanding any other provision to the
      contrary herein) and such shares or other property shall be held in escrow
      for
      the Holder by the Issuer to be issued to the Holder upon and to the extent
      that
      the event actually takes place, upon payment of the current Warrant Price.
      Notwithstanding any other provision to the contrary herein, if the event for
      which such record was taken fails to occur or is rescinded, then such escrowed
      shares shall be cancelled by the Issuer and escrowed property
      returned.

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    5. Notice
      of Adjustments.
      Whenever the Warrant Price or Warrant Share Number shall be adjusted pursuant
      to
      Section 4 hereof (for purposes of this Section 5, each an "adjustment"), the
      Issuer shall cause its Chief Financial Officer to prepare and execute a
      certificate setting forth, in reasonable detail, the event requiring the
      adjustment, the amount of the adjustment, the method by which such adjustment
      was calculated (including a description of the basis on which the Board made
      any
      determination hereunder), and the Warrant Price and Warrant Share Number after
      giving effect to such adjustment, and shall cause copies of such certificate
      to
      be delivered to the Holder of this Warrant promptly after each adjustment.
      Any
      dispute between the Issuer and the Holder of this Warrant with respect to the
      matters set forth in such certificate may at the option of the Holder of this
      Warrant be submitted to one of the national accounting firms currently known
      as
      the "big four" selected by the Holder; provided
      that the
      Issuer shall have ten (10) days after receipt of notice from such Holder of
      its
      selection of such firm to object thereto, in which case such Holder shall select
      another such firm and the Issuer shall have no such right of objection. The
      firm
      selected by the Holder of this Warrant as provided in the preceding sentence
      shall be instructed to deliver a written opinion as to such matters to the
      Issuer and such Holder within thirty (30) days after submission to it of such
      dispute. Such opinion shall be final and binding on the parties hereto.

    

    6. Fractional
      Shares.
      No
      fractional shares of Warrant Stock will be issued in connection with any
      exercise hereof, but in lieu of such fractional shares, the Issuer shall make
      a
      cash payment therefor equal in amount to the product of the applicable fraction
      multiplied by the Per Share Market Value then in effect.

    

    7. Definitions.
      For the
      purposes of this Warrant, the following terms have the following
      meanings:

    

    "Additional
      Shares of Common Stock"
      means
      all shares of Common Stock issued by the Issuer after the Original Issue Date,
      and all shares of Other Common, if any, issued by the Issuer after the Original
      Issue Date, except for Permitted Financings (as defined in the Purchase
      Agreement) and the Other Warrants. 

    

    "Certificate
      of Incorporation"
      means
      the Certificate of Incorporation of the Issuer as in effect on the Original
      Issue Date, and as hereafter from time to time amended, modified, supplemented
      or restated in accordance with the terms hereof and thereof and pursuant to
      applicable law.

    

    "Board"
      shall
      mean the Board of Directors of the Issuer.

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    "Capital
      Stock"
      means
      and includes (i) any and all shares, interests, participations or other
      equivalents of or interests in (however designated) corporate stock, including,
      without limitation, shares of preferred or preference stock, (ii) all
      partnership interests (whether general or limited) in any Person which is a
      partnership, (iii) all membership interests or limited liability company
      interests in any limited liability company, and (iv) all equity or ownership
      interests in any Person of any other type.

    

    "Common
      Stock"
      means
      the Common Stock, par value $0.01 per share, of the Issuer and any other Capital
      Stock into which such stock may hereafter be changed.

    

    "Convertible
      Securities"
      means
      evidences of Indebtedness, shares of Capital Stock or other Securities which
      are
      or may be at any time convertible into or exchangeable for Additional Shares
      of
      Common Stock. The term "Convertible Security" means one of the Convertible
      Securities.

    

    "Governmental
      Authority"
      means
      any governmental, regulatory or self-regulatory entity, department, body,
      official, authority, commission, board, agency or instrumentality, whether
      federal, state or local, and whether domestic or foreign.

    

    "Holder"
      means
      the Person who holds this Warrant. The term "Holders" means one of the Persons
      who shall from time to time hold this Warrant.

    

    "Independent
      Appraiser"
      means a
      nationally recognized or major regional investment banking firm or firm of
      independent certified public accountants of recognized standing (which may
      be
      the firm that regularly examines the financial statements of the Issuer) that
      is
      regularly engaged in the business of appraising the Capital Stock or assets
      of
      corporations or other entities as going concerns, and which is not affiliated
      with either the Issuer or the Holder of any Warrant.

    

    "Issuer"
      means
      Communication Intelligence Corporation, a Delaware corporation, and its
      successors and assigns. 

    

    "Majority
      Holders"
      means
      at any time the Holders of Warrants exercisable for a majority of the shares
      of
      Warrant Stock issuable under the Warrants at the time outstanding.

    

    "Original
      Issue Date"
      means
      _______, 200X.

    

    "OTC
      Bulletin Board"
      means
      the over-the-counter electronic bulletin board.

    

    "Other
      Common"
      means
      any other Capital Stock of the Issuer of any class which shall be authorized
      at
      any time after the date of this Warrant (other than Common Stock) and which
      shall have the right to participate in the distribution of earnings and assets
      of the Issuer without limitation as to amount.

    

    "Other
      Warrants"
      means
      the warrants to purchase shares of Common Stock issued to the other Purchasers
      pursuant to the Purchase Agreement. 

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    “Outstanding
      Common Stock”
means,
      at any given time, the aggregate amount of outstanding shares of Common Stock,
      assuming full exercise, conversion or exchange (as applicable) of all options,
      warrants and other Securities which are convertible into or exercisable or
      exchangeable for, and any right to subscribe for, shares of Common Stock that
      are outstanding at such time.

    

    "Person"
      means
      an individual, corporation, limited liability company, partnership, joint stock
      company, trust, unincorporated organization, joint venture, Governmental
      Authority or other entity of whatever nature.

    

    "Per
      Share Market Value"
      means
      on any particular date (a) the closing bid price for a share of Common Stock
      in
      the over-the-counter market, as reported by the OTC Bulletin Board or in the
      National Quotation Bureau Incorporated (or similar organization or agency
      succeeding to its functions of reporting prices) at the close of business on
      such date, or (b) if the Common Stock is not then reported by the OTC Bulletin
      Board or the National Quotation Bureau Incorporated (or similar organization
      or
      agency succeeding to its functions of reporting prices), then the average of
      the
      "Pink Sheet" quotes for the relevant conversion period, as determined in good
      faith by the Holder, or (c) if the Common Stock is not then publicly traded
      the
      fair market value of a share of Common Stock as determined by the Board in
      good
      faith; provided,
      however,
      that
      the Majority Holders, after receipt of the determination by the Board, shall
      have the right to select, jointly with the Issuer, an Independent Appraiser,
      in
      which case, the fair market value shall be the determination by such Independent
      Appraiser; and provided,
      further
      that all
      determinations of the Per Share Market Value shall be appropriately adjusted
      for
      any stock dividends, stock splits or other similar transactions during such
      period. The determination of fair market value shall be based upon the fair
      market value of the Issuer determined on a going concern basis as between a
      willing buyer and a willing seller and taking into account all relevant factors
      determinative of value, and shall be final and binding on all parties. In
      determining the fair market value of any shares of Common Stock, no
      consideration shall be given to any restrictions on transfer of the Common
      Stock
      imposed by agreement or by federal or state securities laws, or to the existence
      or absence of, or any limitations on, voting rights.

    

    "Purchase
      Agreement"
      means
      the Note and Warrant Purchase Agreement dated as of June 15, 2007, among the
      Issuer and the Purchasers.

    

    "Purchasers"
      means
      the purchasers of the Notes and Warrants issued by the Issuer pursuant to the
      Purchase Agreement.

    

    "Securities"
      means
      any debt or equity securities of the Issuer, whether now or hereafter
      authorized, any instrument convertible into or exchangeable for Securities
      or a
      Security, and any option, warrant or other right to purchase or acquire any
      Security. "Security" means one of the Securities.

    

    "Securities
      Act"
      means
      the Securities Act of 1933, as amended, or any similar federal statute then
      in
      effect.

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    "Subsidiary"
      means
      any corporation at least 50% of whose outstanding Voting Stock shall at the
      time
      be owned directly or indirectly by the Issuer or by one or more of its
      Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

    

    "Term"
      has the
      meaning specified in Section 1 hereof.

    

    "Trading
      Day"
      means
      (a) a day on which the Common Stock is traded on the OTC Bulletin Board, or
      (b)
      if the Common Stock is not traded on the OTC Bulletin Board, a day on which
      the
      Common Stock is quoted in the over-the-counter market as reported by the
      National Quotation Bureau Incorporated (or any similar organization or agency
      succeeding its functions of reporting prices); provided,
      however,
      that in
      the event that the Common Stock is not listed or quoted as set forth in (a)
      or
      (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and
      any
      day which shall be a legal holiday or a day on which banking institutions in
      the
      State of New York are authorized or required by law or other government action
      to close.

    

    "Voting
      Stock"
      means,
      as applied to the Capital Stock of any corporation, Capital Stock of any class
      or classes (however designated) having ordinary voting power for the election
      of
      a majority of the members of the Board of Directors (or other governing body)
      of
      such corporation, other than Capital Stock having such power only by reason
      of
      the happening of a contingency.

    

    "Warrants"
      means
      the Warrants issued and sold pursuant to the Purchase Agreement, including,
      without limitation, this Warrant, and any other warrants of like tenor issued
      in
      substitution or exchange for any thereof pursuant to the provisions of Section
      2(c) or 2(d) hereof or of any of such other Warrants. 

    

    "Warrant
      Price"
      initially means $______ per share as such price may be adjusted from time to
      time as shall result from the adjustments specified in this Warrant, including
      Section 4 hereto.

    

    "Warrant
      Share Number"
      means
      at any time the aggregate number of shares of Warrant Stock which may at such
      time be purchased upon exercise of this Warrant, after giving effect to all
      prior adjustments and increases to such number made or required to be made
      under
      the terms hereof.

    

    "Warrant
      Stock"
      means
      Common Stock issuable upon exercise of any Warrant or Warrants or otherwise
      issuable pursuant to any Warrant or Warrants.

    

    9. Other
      Notices.
      In case
      at any time:

    

    
      	 	
              (A)

            	
              the
                Issuer shall make any distributions to the holders of Common Stock;
                or

            

    

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    
      	 	
              (B)

            	
              the
                Issuer shall authorize the granting to all holders of its Common
                Stock of
                rights to subscribe for or purchase any shares of Capital Stock of
                any
                class or other rights; or

            

    

    

    
      	 	
              (C)

            	
              there
                shall be any reclassification of the Capital Stock of the Issuer;
                or

            

    

    

    
      	 	
              (D)

            	
              there
                shall be any capital reorganization by the Issuer;
                or

            

    

    

    
      	 	
              (E)

            	
              there
                shall be any (i) consolidation or merger involving the Issuer or
                (ii)
                sale, transfer or other disposition of all or substantially all of
                the
                Issuer's property, assets or business (except a merger or other
                reorganization in which the Issuer shall be the surviving corporation
                and
                its shares of Capital Stock shall continue to be outstanding and
                unchanged
                and except a consolidation, merger, sale, transfer or other disposition
                involving a wholly-owned Subsidiary);
                or

            

    

    

    
      	 	
              (F)

            	
              there
                shall be a voluntary or involuntary dissolution, liquidation or winding-up
                of the Issuer or any partial liquidation of the Issuer or distribution
                to
                holders of Common Stock;

            

    

    

    then,
      in
      each of such cases, the Issuer shall give written notice to the Holder of the
      date on which (i) the books of the Issuer shall close or a record shall be
      taken
      for such dividend, distribution or subscription rights or (ii) such
      reorganization, reclassification, consolidation, merger, disposition,
      dissolution, liquidation or winding-up, as the case may be, shall take place.
      Such notice also shall specify the date as of which the holders of Common Stock
      of record shall participate in such dividend, distribution or subscription
      rights, or shall be entitled to exchange their certificates for Common Stock
      for
      securities or other property deliverable upon such reorganization,
      reclassification, consolidation, merger, disposition, dissolution, liquidation
      or winding-up, as the case may be. Such notice shall be given at least twenty
      (20) days prior to the action in question and not less than ten (10) days prior
      to the record date or the date on which the Issuer's transfer books are closed
      in respect thereto. This Warrant entitles the Holder to receive copies of all
      financial and other information distributed or required to be distributed to
      the
      holders of the Common Stock.

    

    10. Amendment
      and Waiver.
      Any
      term, covenant, agreement or condition in this Warrant may be amended, or
      compliance therewith may be waived (either generally or in a particular instance
      and either retroactively or prospectively), by a written instrument or written
      instruments executed by the Issuer and the Majority Holders; provided,
      however,
      that no
      such amendment or waiver shall reduce the Warrant Share Number, increase the
      Warrant Price, shorten the period during which this Warrant may be exercised
      or
      modify any provision of this Section 10 without the consent of the Holder of
      this Warrant.

    

    11. Governing
      Law.
      THIS
      WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
      STATE OF CALIFORNIA, WITHOUT GIVING EFFECT TO ANY OF ITS PRINCIPLES OF CONFLICTS
      OF LAW WHICH WOULD RESULT IN THE APPLICATION OF THE SUBSTANTIVE LAW OF ANOTHER
      JURISDICTION.

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    12. Notices.
      Any and
      all notices or other communications or deliveries required or permitted to
      be
      provided hereunder shall be in writing and shall be deemed given and effective
      on the earlier of (i) the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile telephone number specified for
      notice prior to 5:00 p.m., eastern time, on a Trading Day, (ii) the Trading
      Day
      after the date of transmission, if such notice or communication is delivered
      via
      facsimile at the facsimile telephone number specified for notice later than
      5:00
      p.m., eastern time, on any date and earlier than 11:59 p.m., eastern time,
      on
      such date, (iii) the Trading Day following the date of mailing, if sent by
      nationally recognized overnight courier service or (iv) actual receipt by the
      party to whom such notice is required to be given. The addresses for such
      communications shall be with respect to the Holder of this Warrant or of Warrant
      Stock issued pursuant hereto, addressed to such Holder at its last known address
      or facsimile number appearing on the books of the Issuer maintained for such
      purposes, or with respect to the Issuer, addressed to:

    

    Communication
      Intelligence Corporation

    275
      Shoreline Drive, Suite 500

    Redwood
      Shores, California 94065

    Attention:
      Frank Dane

    Tel.
      No.:
      (650) 802-7888

    Fax
      No.:
      (650) 802-7777

    

    with
      copies (which copies 

    shall
      not
      constitute notice 

    to
      the
      Issuer) to:  Davis
      Wright Tremaine LLP

    1300
      S.W.
      Fifth Ave., 23rd
      Floor

    Portland,
      Oregon 97201

    Attention:
      Michael C. Phillips, Esq.    

    Tel.
      No.:
      (503) 241-2300

    Fax
      No.:
      (503) 778-5299

     

    Copies
      of
      notices to the Holder shall be sent to [Insert
      name, address, phone and fax number]. Any
      party
      hereto may from time to time change its address for notices by giving at least
      ten (10) days written notice of such changed address to the other party
      hereto.

    

    13. Remedies.
      The
      Issuer stipulates that the remedies at law of the Holder of this Warrant in
      the
      event of any breach or threatened breach by the Issuer in the performance of
      or
      compliance with any of the terms or provisions of this Warrant are not and
      will
      not be adequate and that, to the fullest extent permitted by law, such terms
      or
      provisions may be specifically enforced by a decree for the specific performance
      of any agreement contained herein or by an injunction against a violation of
      any
      of the terms or provisions hereof or otherwise.

    

    14. Successors
      and Assigns.
      This
      Warrant and the rights evidenced hereby shall inure to the benefit of and be
      binding upon the successors and assigns of the Issuer, the Holder hereof and
      (to
      the extent provided herein) the Holders of Warrant Stock issued pursuant hereto,
      and shall be enforceable by any such Holder or Holders of Warrant
      Stock.

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    15. Severability.
      If, in
      any action before any court or agency legally empowered to enforce any provision
      contained herein, any provision hereof is found to be unenforceable, then such
      provision shall be deemed modified to the extent necessary to make it
      enforceable by such court or agency. If any such provision is not enforceable
      as
      set forth in the preceding sentence, the unenforceability of such provision
      shall not affect the other provisions of this Warrant, but this Warrant shall
      be
      construed as if such unenforceable provision had never been contained
      herein.

    

    16. Headings.
      The
      headings of the Sections of this Warrant are for convenience of reference only
      and shall not, for any purpose, be deemed a part of this Warrant and shall
      not
      influence the construction or interpretation of this Warrant.

    

    [SIGNATURE
      PAGE FOLLOWS]

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the Issuer has executed this Warrant as of the day and year
      first above written.

    

    

    COMMUNICATION
      INTELLIGENCE CORPORATION

    

    

    

    By:       

    Name:
      Frank Dane

    Title:
      Chief Financial and Legal Officer

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    EXERCISE
      FORM

    WARRANT

    

    COMMUNICATION
      INTELLIGENCE CORPORATION

    

    

    The
      undersigned _______________, pursuant to the provisions of the within Warrant,
      hereby elects to purchase _____ shares of Common Stock of ____________ covered
      by the within Warrant.

    

    Dated:
      _________________  Signature ___________________________

    

    Address _____________________

    _____________________

    

    ASSIGNMENT

    

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the within Warrant and all rights evidenced thereby and
      does
      irrevocably constitute and appoint _____________, attorney, to transfer the
      said
      Warrant on the books of the within named corporation.

    

    Dated:
      _________________  Signature ___________________________

    

    Address _____________________

    _____________________

    

    PARTIAL
      ASSIGNMENT

    

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the right to purchase _________ shares of Warrant Stock
      evidenced by the within Warrant together with all rights therein, and does
      irrevocably constitute and appoint ___________________, attorney, to transfer
      that part of the said Warrant on the books of the within named
      corporation.

    

    Dated:
      _________________  Signature ___________________________

    

    Address _____________________

    _____________________

    

    FOR
      USE
      BY THE ISSUER ONLY:

    

    This
      Warrant No. W2007-___ canceled (or transferred or exchanged) this _____ day
      of
      ___________, _____, shares of Common Stock issued therefor in the name of
      _______________, Warrant No. 2007 W-_____ issued for ____ shares of Common
      Stock
      in the name of _______________.

     

     

    16exhibit10sa.htm

    Exhibit
      10.1

    
SETTLEMENT
      AGREEMENT

     

    This
      SETTLEMENT
      AGREEMENT is
      entered into as of the latest of the dated signatures below ("Effective Date")
      by and among Technology
      Research Corporation ("TRC"), and
      Tower
      Manufacturing Corporation ("Tower").

    

    IN
      CONSIDERATION OF THE MUTUAL COVENANTS AND PROMISES CONTAINED HEREIN, THE
      SUFFICIENCY OF WHICH THE PARTIES IRREVOCABLY ACKNOWLEDGE, THE PARTIES AGREE
      AS
      FOLLOWS:

    

    ARTICLE
      1

    

    DEFINITIONS

    

    The
      following terms shall have the meaning set forth below when used in this
      Agreement:

    

    1.1 "337
      Patent" means U.S. Patent No. 6,292,337 entitled "Electrical System with Arc
      Protection", including all foreign counterparts, divisional, continuation,
      reissued, reexamined and continuation in-part patents.

    

    1.2 “199
      Patent" means U.S. Patent No. 5,943,199 entitled "Mini Appliance Leakage Current
      Interrupter," including all foreign counterparts, divisional, continuation,
      reissued, reexamined and continuation in-part patents.

    

    1.3 "LCDI
      Products" means Leakage Current Detector Interruptor products.

    

    1.4 "Agreement"
      means this Settlement Agreement.

    

    1.5 "Party"
      or "Parties" means any party or parties to this Agreement, including affiliate
      companies and parent companies, as the case may be.

    

    1.6 "Stipulation
      of Dismissal with Prejudice" means the two Stipulation of Dismissal with
      Prejudice documents attached as Appendix A.

    

    ARTICLE
      2

    

    BACKGROUND

    

    2.1 TRC
      is
      the owner of the entire right, title and interest in and to the `337
      Patent.

    

    2.2 TRC
      has
      filed suit against Tower and Fedders Corporation ("Fedders") in the U.S.
      District Court for the Middle District of Florida, No. 8:05-cv-1455-RAL-TGW,
      ("the Florida Action"),
      alleging infringement of the `337 patent. Tower asserted several affirmative
      defenses and counterclaims, alleging, among other things, that it did not
      infringe the `337 Patent, that the `337 Patent is invalid, and that TRC
      committed tort and antitrust violations.

    

    2.3 Tower
      is
      the owner of the entire right, title and interest in and to the '199
      Patent.

    
      
        
          **The
            appearance of a double asterisk denotes confidential information that
            has been
            omitted from the exhibit and filed separately, accompanied by a confidential
            treatment request, with the Securities and Exchange Commission pursuant
            to Rule
            24b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange
            Act").

          417747.04

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    2.4 Tower
      has
      filed suit against TRC in the U.S. District Court for the District of Rhode
      Island, No. 1:06-cv-212-T-DLM ("the Rhode Island Action"), alleging infringement
      of the '199 Patent. TRC asserted several affirmative defenses and counterclaims,
      alleging, among other things, that it did not infringe the `199 Patent, that
      the
      `199 Patent is invalid, and that Tower committed tort and antitrust
      violations.

    

    2.5 The
      parties to this Agreement now desire to settle the Florida Action and the Rhode
      Island Action, and to settle and resolve all issues which they may have against
      each other arising out of or in connection with the `337 and '199
      Patents.

    

    ARTICLE
      3

    

    PAYMENTS
      AND ROYALTIES TO TRC

    

    3.1 Tower
      shall pay TRC Three Million Two Hundred Thousand and No/100 Dollars
      ($3,200,000.00) in full settlement regarding all products made, used, sold,
      imported or offered for sale by either Tower or Fedders prior to July 1, 2007.
      One Million Five Hundred Thousand and No/100 Dollars ($1,500,000.00) of this
      sum
      shall be payable within thirty days of the dismissal of the Florida Action
      and
      the balance shall be paid in two (2) annual and equal installments over a period
      of two (2) years, each installment being due within thirty days of the
      anniversary of the dismissal of the Florida Action. The amount outstanding
      shall
      be guaranteed personally by Louis Shatkin. The amount of the outstanding payment
      owed by Tower to TRC shall accrue interest, compounded quarterly, at the prime
      interest rate in effect as of the last day of the previous quarter.

    

    3.2 Going
      forward after June 30, 2007, for so long as the `337 Patent is valid and
      enforceable, the royalty for any Tower LCDI Product made, used, sold, imported
      or offered for sale by or for Tower or its subsidiaries after June 30, 2007
      that
      utilizes the inventions claimed by the `337 Patent is **.

    

    3.3 Going
      forward after June 30, 2007, for so long as the `199 Patent is valid and
      enforceable, the royalty for any TRC LCDI Product made, used, sold, imported
      or
      offered for sale by or for TRC or its subsidiaries after June 30, 2007 that
      utilizes the inventions claimed by the `199 Patent is **.

    

    3.4 Royalty
      payments will be paid quarterly, will be due for the previous quarter on the
      15th
      of the
      month following the end of that quarter, and will include a statement of the
      number of units ** made, used, sold, imported or offered for sale utilizing
      the
      patented technology. TRC and Tower shall have the right to audit the other's
      statements under reasonable conditions.

    

    3.5 The
      payments required to be made pursuant to section 3.1 of this Agreement shall
      be
      made in United States dollars by wire transfer of immediately available funds
      as
      follows:

    

    Technology
      Research Corporation

    5250
      140th
      Avenue
      North

    Clearwater,
      FL 33760-3728

    Bank
      Name: **

    City/State: **

    Account
      No.: **

    ABA
      No.: **

    Swift
      Code: **
      

    Account
      Name:

    

    ARTICLE
      4

    

    LICENSE
      AGREEMENT

    

    4.1 For
      so
      long as Tower remains in compliance with the payment obligations specified
      in
      section 3.1 of this Settlement Agreement, TRC hereby grants to Tower and its
      parent companies, existing contract manufacturers, and subsidiaries and Tower
      Switches Limited a perpetual, worldwide, non-transferable (except as set forth
      in Section 10.1), non-exclusive license, limited to the room air conditioner
      (RAC) market, to make, have made, use, offer-to-sell, sell, export, and import,
      or otherwise dispose of products and services, the making, having made, use,
      offering to sell, selling, exporting or importing of which would in the absence
      of this license infringe any valid and enforceable claim of the `337 Patent.
      This license shall apply to Tower Switches Limited, and to Tower's customers,
      manufacturers, partners, distributors, re-sellers, vendors, and their respective
      end users, regarding all products and services made by, made for, provided
      by,
      or purchased from Tower. This license shall not be interpreted or construed
      as
      granting Tower any right to sub-license any third party or Non-Subsidiary to
      use
      any invention claimed in the `337 Patent, except as such invention is or was
      embodied in materials, equipment, or products provided directly or indirectly
      by
      Tower. "Non-subsidiary" shall mean any corporation of which Tower does not
      own
      or control more than 50% of the U.S. or foreign corporation, company or other
      legal entity. Further, this license shall not be interpreted or construed to
      include any products or services of any third party that acquires Tower or
      any
      of Tower's subsidiaries or affiliates, where such products or services (i)
      were
      in existence at the time of the acquisition or (ii) are new products or services
      developed by said third party subsequent to said acquisition.

    

    4.2 The
      term
      of the license granted to Tower shall be for the life of the `337
      Patent.

     

    4.3 Tower
      hereby grants to TRC and its parent companies, existing contract manufacturers,
      and subsidiaries a perpetual, worldwide, non-transferable (except as set forth
      in Section 10.1), non-exclusive license, limited to the room air conditioner
      (RAC) market, to make, have made, use, offer-to-sell, sell, export, and import,
      or otherwise dispose of products and services, the making, having made, use,
      offering to sell, selling, exporting or importing of which would in the absence
      of this license infringe any valid and enforceable claim of the '199 Patent.
      This license shall apply to TRC's customers, manufacturers, partners,
      distributors, re-sellers, vendors, and their respective end users, regarding
      all
      products and services made by, made for, provided by, or purchased from TRC.
      This license shall not be interpreted or construed as granting TRC any right
      to
      sub-license any third party or Non-Subsidiary to use any invention claimed
      in
      the '199 Patent, except as such invention is or was embodied in materials,
      equipment, or products provided directly or indirectly by TRC. "Non-subsidiary"
      shall mean any corporation of which TRC does not own or control more than 50%
      of
      the U.S. or foreign corporation, company or other legal entity. Further, this
      license shall not be interpreted or construed to include any products or
      services of any third party that acquires TRC or any of TRC’s subsidiaries or
      affiliates, where such products or services (i) were in existence at the time
      of
      the acquisition or (ii) are new products or services developed by said third
      party subsequent to said acquisition.

    

    4.4 The
      term
      of the license granted to TRC shall be for the life of the '199
      Patent.

    

    4.5 Other
      than this license and the release of Article 6, no license, right, or immunity
      is granted by TRC or by Tower to
      any
      third party, either expressly or by implication, or by estoppel, or otherwise,
      to any patents, inventions, or other property right.

    

    

    

    

    ARTICLE
      5

    

    DISMISSAL
      OF THE ACTIONS

    

    5.1 Within
      five business days after the complete execution and delivery of this Agreement,
      TRC and Tower shall cause their respective counsel to endorse and file the
      Stipulations of Dismissal with Prejudice attached as Appendix A to cause all
      of
      their claims and counterclaims in the Actions with respect to each other and
      Fedders to be dismissed with prejudice. The Stipulations may be amended to
      the
      extent necessary to comply with local rules.

    

    ARTICLE
      6

    

    MUTUAL
      RELEASES

    

    6.1 TRC
      hereby releases and forever discharges Tower, and all of its respective
      directors, officers, stockholders, affiliate companies, subsidiaries, acquired
      companies, employees, attorneys, agents, and Tower Switches Limited
      (collectively, "Tower
      Entities"), and their permitted successors and assigns, from any and all claims,
      demands, obligations, losses, causes of action, damages, penalties, costs,
      expenses, attorney fees, liabilities, compensation, and indemnities of any
      nature, whether based on contract, tort, statute or other legal or equitable
      theory of recovery, whether known or unknown, which as of the Effective Date
      of
      this Agreement TRC had or claims to have had against Tower, including but not
      limited to any arising out of or in connection with claims that were made or
      that could have been made in any form with respect to the `337 or '199 patents
      or other patents, and except for any breach of this Agreement. This release
      shall apply to Tower's customers (including Fedders), manufacturers, partners,
      distributors, re-sellers, vendors, their respective end users, and to Tower
      Switches Limited, regarding all products and services at any time made by,
      provided by, purchased from, or licensed from Tower Entities.

    

    6.2 Tower
      hereby releases and forever discharges TRC, and all of its respective directors,
      officers, stockholders, members, affiliate companies, subsidiaries, acquired
      companies, acquirers, parent companies, employees, attorneys, and agents
      (collectively, "TRC Entities"), and their permitted successors and assigns,
      from
      any and all claims, demands, obligations, losses, causes of action, damages,
      penalties, costs, expenses, attorney fees, liabilities, compensation, and
      indemnities of any nature, whether based on contract, tort, statute or other
      legal or equitable theory of recovery, whether known or unknown, which as of
      the
      Effective Date of this Agreement Tower. Tower Switches Limited, and their
      respective affiliate and parent companies, had or claims to have had against
      TRC, including but not limited to any arising out of or in connection with
      claims that were made or that could have been made in any form with respect
      to
      the `337 or `199 patents or other patents, and except for any breach of this
      Agreement. This release shall apply to TRC's customers, manufacturers, partners,
      distributors, re-sellers, vendors, and their respective end-users, regarding
      all
      products and services at any time made by, provided by, purchased from, or
      licensed from TRC Entities.

    

    6.3 TRC
      hereby represents that it has no present intent to enforce any patent held
      by
      TRC against Tower.

    

    6.4 Tower
      hereby represents that it has no present intent to enforce any patent held
      by
      Tower against TRC.

    

    6.5 The
      mutual releases granted above are not to be construed as releasing the parties
      from any obligations arising and unfulfilled under this agreement.

    

    ARTICLE
      7

    

    FEES
      AND COSTS

    

    7.1 The
      Parties shall pay all of their own fees and expenses, including court costs,
      legal fees and expert fees, incurred in the prosecution or defense of the
      Florida Action and the Rhode Island Action, and in the preparation of this
      Agreement.

    

    ARTICLE
      8

    

    REPRESENTATIONS
      AND WARRANTIES

    

    8.1 Each
      Party represents and warrants that it has the right to enter into this
      Agreement.

    

    8.2
       The
      Parties' representatives, by their signatures below, represent and warrant
      that
      they are duly authorized to execute and deliver this Agreement on behalf of
      the
      respective Party.

    

    8.3 TRC
      hereby represents, covenants, and warrants that it will not assert against
      Tower
      Entities or their permitted successors and assigns, or any of Tower's customers
      (including Fedders), manufacturers, partners, distributors, re-sellers, vendors,
      or any other permitted user of Tower LCDI Products (whether such permission
      is
      granted directly by Tower or another licensee of Tower) (collectively together
      with Tower Entities, "Tower Users") any claim of infringement based upon the
      `337 Patent arising out of or in connection with the use, sale, or distribution
      of the Tower LCDI Products.

    

    8.4 Tower
      hereby represents, covenants, and warrants that it will not assert against
      TRC
      Entities or their permitted successors and assigns, or any of TRC's customers,
      manufacturers, partners, distributors, re-sellers, vendors, or any other
      permitted user of TRC LCDI Products (whether such permission is granted directly
      by TRC or another licensee of TRC) (collectively together with TRC Entities,
      "TRC Users") any claim of infringement based upon the '199 Patent arising out
      of
      or in connection with the use, sale, or distribution of the TRC LCDI
      Products.

    

    8.5 **

    

    8.6 **

    ARTICLE
      9

    

    CONFIDENTIALITY

    

    9.1 The
      Parties
      shall
      keep the terms of this Agreement confidential and shall not now or hereafter
      divulge these terms to any third party except:

    

    9.1.1
      with the prior written consent of the other Party; or

    

    9.1.2
      to
      any governmental body having jurisdiction to call for such terms;
      or

    

    9.1.3
      as
      otherwise may be required by law or legal process, including to legal and
      financial advisors in their capacity of advising a Party in such matters;
      or

    

    9.1.4
      during the course of litigation so long as the disclosure of such terms and
      conditions are restricted in the same manner as is the confidential information
      of other litigating parties and so long as (a) the restrictions are embodied
      in
      a court-entered Protective Order and (b) the disclosing Party informs the other
      Party in writing at least ten (10) days in advance of the disclosure;
      or

    

    9.1.5
      in
      confidence to legal counsel, accountants, banks, financing sources and their
      advisors solely in connection with complying with financial transactions or
      legal reporting requirements; or

    

    9.1.6
      any
      disclosure pursuant to any applicable securities regulations, including TRC's
      disclosure in public SEC filings of the existence, amount, terms and copies
      of
      this Agreement; or

    

    9.1.7
      the
      Parties may disclose the terms of this Agreement and the settlement of the
      Florida Action and the Rhode Island Action to the extent provided, or in the
      form provided, in Appendix B to this Agreement.

    

    ARTICLE
      10

    

    GENERAL
      PROVISIONS

    

    10.1 Assignment.
      This
      Agreement and any rights, licenses or privileges under this Agreement including,
      but not limited to, the license and release or any rights under them, shall
      be
      freely assignable to (i) any parent, or subsidiary of a Party or (ii) an
      acquirer of a Party or of any portion of a Party's business to which this
      Agreement applies (whether by way of an asset or stock transaction). TRC and
      Tower represent that they are not currently engaged in any active negotiations
      in connection with their acquisition by any third party.

    

    10.2
       Waiver.
      The
      waiver by any Party of a breach of any provision of this Agreement shall not
      operate or be construed as a waiver of any other or any subsequent breach of
      the
      same or a different kind.

    

    10.3
       Amendments.
      Any
      changes to this Agreement must be in writing specifically stating an intention
      to modify this Agreement signed by the Party or Parties to be
      bound.

    

    10.4
       Survival
      of Representations, Covenant and Warranties.
      The representations,
      covenants and warranties contained in this Agreement shall survive the execution
      and delivery of this Agreement.

    

    10.5
       Relationship
      of Parties.
      Nothing
      in this Agreement shall create or be deemed to create any relationship of
      agency, partnership, or joint venture between TRC, on the one hand, and Tower,
      on the other.

    

    10.6
       No
      Third Party Beneficiaries.
      Except
      with respect to the Tower and TRC Users, this Agreement is made and entered
      into
      for the sole protection and benefit of the Parties, and no other person or
      entity shall be a direct or indirect beneficiary of or shall have any direct
      or
      indirect cause of action or claim in connection with this
      Agreement.

    

    10.7
       Notices Any
      notice or other communication required or permitted under this Agreement shall
      be given in writing and shall be conclusively deemed to have been
      duly
      given on the date delivered if delivered personally, or five (5) days after
      deposit in the United States mail, by registered or certified mail, postage
      prepaid, addressed as follows:

    

    10.7.1
       Notices
      to TRC shall be addressed to:

    

    William
      C. Bergmann, Esq.

    Baker
      & Hostetler LLP

    Washington
      Square, Suite 1100

    Washington,
      D.C. 20036-5304

    

    10.7.2
       Notices
      to Tower shall be addressed to:

    

    John
      J.
      Cotter, Esq.

    Kirkpatrick
      & Lockhart Nicholson Graham LLP

    One
      Lincoln Street

    Boston,
      Massachusetts 021 1 1-2950

    

    10.8
       Headings.
      All
      headings in this Agreement are used for convenience only and shall not affect
      the interpretation of this Agreement.

    

    10.9
       Applicable
      Law; Choice of Forum: Jurisdiction_
      This
      Agreement shall be governed by and construed under the laws of the State of
      Delaware, without regard to its conflict of laws provisions. It is further
      agreed that all disputes and matters whatsoever arising under, in connection
      with or incident to this Agreement shall be litigated, if at all, in and before
      the United States District Court for the District of Delaware, to the exclusion
      of the Courts of any other state, locality or country. The Parties irrevocably
      consent to personal jurisdiction in such court for such purposes.

    

    10.10
       No
      Strict Construction.
      Each
      Party and counsel for each Party have reviewed this Agreement, and, accordingly,
      the normal rule of construction to the effect that any ambiguities are to be
      resolved against the drafting party shall not be employed in the interpretation
      of this Agreement.

    

    10.11
       Entire
      Agreement.
      This
      Agreement contains the entire understanding among TRC, on the one hand, and
      Tower, on the other, superseding all prior or contemporaneous communications,
      negotiations, discussions, agreements, and understandings among the Parties
      with
      respect to the subject matter of this Agreement.

    

    10.12
       Counterparts.
      This
      Agreement may be executed in any number of counterparts, including those
      transmitted to and among the Parties via facsimile, with the same effect as
      if
      the signatures on each counterpart were upon a single instrument. All
      counterparts, taken together, shall constitute this Agreement.

    

    10.13
       Partial
      Invalidity.
      If any
      of the provisions herein shall be invalid, illegal or unenforceable in any
      respect, this Agreement shall be construed without the term or provision so
      that
      this Agreement will remain binding on the Parties,

    

    10.14
       Non-Disparagement.
      Each
      Party will instruct its executive officers and board members not to disparage
      any other Party with respect to the matters at issue in the Florida Action
      and
      the Rhode Island Action.

    

    

    

    

    

    IN
      WITNESS WHEREOF, intending to be legally bound, the Parties have caused this
      Agreement to be executed by their duly authorized representatives as of the
      dates set forth below. 

    

    On
      this
      ______ day of December, 2006      

    Louis
      J.
      Shatkin

    President

    Tower
      Manufacturing Corporation

    

    

    On
      this
      _______ day of December, 2006      

    Robert
      S.
      Wiggins

    

    President
      and Chief Executive Officer

    

    Technology
      Research Corporation

    

    

    

    

    GUARANTY
      OF PERFORMANCE AND INDEMNITY

    

    In
      consideration of the execution of the above Settlement Agreement between Tower
      and TRC,
      I
      hereby
      personally guaranty the due performance by Tower of all the covenants and
      agreements on its part contained in section 3.1 of the Settlement Agreement,
      and
      the payment of all damages, costs, and expenses which by virtue of the
      Settlement Agreement may become recoverable from Tower by TRC

    

    On
      this
      _______ day of December, 2006      

    Louis
      J.
      Shatkin

    

    
      
        
          **Confidential
            treatment requested pursuant to Rule 24b-2 of the Exchange Act.

          417747.04

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    APPENDIX
      A

    

    STIPULATION
      OF DISMISSAL WITH PREJUDICE

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    UNITED
      STATES DISTRICT COURT

    FOR
      THE
      MIDDLE DISTRICT OF FLORIDA

    TAMPA
      DIVISION

    Case
      No.
      8:05-cv-01455-RAL-TGW

    

    TECHNOLOGY
      RESEARCH CORP., 

    

    Plaintiff,
      

    

    v.

    

    TOWER
      MANUFACTURING CORP. and 

    FEDDERS
      CORP.,

    

    Defendants.

    /

    

    STIPULATION
      OF DISMISSAL WITH PREJUDICE

    

    The
      parties, pursuant to Rules 41(a)(1)(ii) and 41(c), hereby stipulate to the
      dismissal of this action with prejudice, including all claims and counterclaims,
      each party to bear its own costs and expenses.

    

    

    
      
        
          **Confidential
            treatment requested pursuant to Rule 24b-2 of the Exchange Act.

          417747.04

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    BAKER
      & HOSTETLER LLP

    

    By:
        /s/   

    William
      C. Bergmann

    Email:
      wbergmann@bakerlaw.com 

    Baker
      & Hostetler LLP

    Washington
      Square, Suite 1100 

    1050
      Connecticut Avenue, NW 

    Washington,
      DC 20036-5304 

    Phone:
      202.861.1500

    Fax:
      202.861.1783

    

    KIRKPATRICK
      & LOCKHART    NICHOLSON
      GRAHAM LLP

    

    By:
        /s/    

    John
      J.
      Cotter

    Email:
      jcotter@king.com 

    Kirkpatrick
      & Lockhart 

    Nicholson
      Graham LLP 

    State
      Street Financial Center

    One
      Lincoln Street

    Boston,
      MA 02111-2950

    Telephone:
      (617) 261-3100

    Fax:
      (617) 261-3175

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
      
        
          **Confidential
            treatment requested pursuant to Rule 24b-2 of the Exchange Act.

          417747.04

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    IN
      THE
      UNITED STATES DISTRICT
      COURT

    FOR
      THE
      DISTRICT OF RHODE ISLAND

    Civil
      Action
      No. 06-212-T-DLM

    

    TOWER
      MANUFACTURING CORPORATION, 

    

    Plaintiff,
      

    

    v.

    

    TECHNOLOGY
      RESEARCH CORPORATION,

    

    Defendant.

    /

    

    STIPULATION
      OF DISMISSAL WITH PREJUDICE

    

    The
      parties, pursuant to Rules 41(a)(1)(ii) and 41(c), hereby stipulate to the
      dismissal of this action with prejudice, including all claims and counterclaims,
      each party to bear its own costs and expenses.

    

    
      
        
          **Confidential
            treatment requested pursuant to Rule 24b-2 of the Exchange Act.

          417747.04

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

     

    BAKER
      & HOSTETLER LLP

    

    By:
        /s/   

    William
      C. Bergmann

    Email:
      wbergmann@bakerlaw.com 

    Baker
      & Hostetler LLP

    Washington
      Square, Suite 1100 

    1050
      Connecticut Avenue, NW 

    Washington,
      DC 20036-5304 

    Phone:
      202.861.1500

    Fax:
      202.861.1783

    

    KIRKPATRICK
      & LOCKHART    NICHOLSON
      GRAHAM LLP

    

    By:
        /s/    

    John
      J.
      Cotter

    Email:
      jcotter@king.com 

    Kirkpatrick
      & Lockhart 

    Nicholson
      Graham LLP 

    State
      Street Financial Center

    One
      Lincoln Street

    Boston,
      MA 02111-2950

    Telephone:
      (617) 261-3100

    Fax:
      (617) 261-3175

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    APPENDIX
      B

    

    PRESS
      RELEASE

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}]]