Document:

exhibit_10-24.htm

    Exhibit 10.24

        

      *Portions
of this exhibit marked [*] are requested to be treated
confidentially.

       

      CONTENT
LICENSE AGREEMENT

       

              This
CONTENT
LICENSE AGREEMENT (the “Agreement”)
is entered into and effective September 17, 2008 (the “Effective
Date”), by and between World Book, Inc. (“World
Book”), a Delaware corporation with offices at 233 North Michigan Avenue,
Suite 2000, Chicago, IL 60601, and HSW International, Inc. (“HSWI”),
a Delaware corporation with offices at One Capital City Plaza, 3350 Peachtree
Road, Suite 1600, Atlanta, Georgia  30326.

       

              WHEREAS,
World Book owns or licenses certain articles and other materials including,
without limitation, the Reference Content and Images
content.

       

              WHEREAS,
HSWI desires to Display certain Content on the HSWI Websites and World Book
desires to license the Content for this use in accordance with the terms and
conditions set forth herein.

       

              NOW,
THEREFORE, in consideration of the mutual promises and covenants set
forth below, the parties hereto agree as follows:

       

      1.     DEFINITIONS.  Capitalized
terms not otherwise defined herein shall have the meanings specified
below.

       

      1.1 “Acquisition” is defined in
Section 11.8
hereof.

       

      1.2 “Payments/Advances” is defined
in Section
4.1(ii)
hereof.

       

      1.3 “Affiliate” means any
distributor or franchisee of HSWI or any company or other entity worldwide,
including without limitation corporations, partnerships, joint
ventures, and limited liability companies in which HSWI directly or indirectly
holds at least a 19% ownership, equity, control or financial interest and which
HSWI intends to enjoy any of HSWI’s rights hereunder.  A list of
Affiliates as of the Effective Date is attached hereto as Attachment
A.  Attachment A may be
modified from time to time upon notice by HSWI to reflect a revised list of
Affiliates and each modified Attachment A shall be
deemed incorporated herein by reference.

       

      1.4 “Affinity” means the
arrangement of Reference Content and Images into articles about a variety of
subjects as agreed by HSWI and World Book in accordance with this Agreement and
identified in detail in Schedule
A.

       

      1.5 “Article” is defined in Section 2.2(i)
hereof.

       

      1.6 “Buy-Out Fee” is defined in
Section 4.2 hereof.

       

      1.7 “Competitors” is defined in
Section 11.8
hereof.

       

      1.8 “Competitors II” is defined in
Section 2.1(ii)
hereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      1.9 “Confidential Information”
means any and all trade secrets, proprietary or confidential information of
either party and includes, without limitation: (a) any information, software,
material, data or business, financial, operational, customer, vendor, and other
information disclosed by one party to the other, (b) the terms of this
Agreement, and/or (c) the fact of the existence of this Agreement except as
specifically permitted in Section 7.  Confidential Information will not
include information that the receiving party can prove:  (w) was
already in such party’s possession prior to receipt; (x) was independently
developed by such party; (y) was obtained from a third party who had the right
to disclose such information to such party, and/or (z) was or became generally
available to the public other than as a result of disclosure by such
party.

       

      1.10 “Content” means, collectively:
(a) the Reference Content; (b) Translated Content; (c) any
updates to any of the foregoing provided by World Book; and (d) World Book
Derivatives. The term “Content” shall not include any HSWI
Modifications.

       

      1.11 “Delivery Period” means the
following:

       

      (i)     July 1,
2008 – December 30th, 2009

       

      1.12 “Display” means to use,
publicly display, publicly perform, provide a link to, provide the ability to
download and/or print and otherwise make available on or through web
sites.

       

      1.13 “Effective Date” is defined in
the preamble of this Agreement.

       

      1.14 “Encyclopedia” means a tab
or section of a website: (a) branded with the word “encyclopedia”; or (b) that
consists solely of multiple unrelated Affinities as provided by World Book
hereunder.

       

      1.15 “Excess Royalties” is defined
in Section
4.1(iii)
hereof.

       

      1.16 “Exclusive” shall mean World
Book shall have no further right to grant to third parties the same or any other
licenses to the Content in the Open Free Web and itself retains no such rights
or other licenses.

       

      1.17 “Force Majeure Event” is
defined in Section
11.1
hereof.

       

      1.18 “HSWI Modifications” means
modifications to the Content made by or on behalf of HSWI or its Affiliates in
accordance with this Agreement, except to the extent the HSWI Modifications are
World Book Derivatives.

       

      1.19 “HSWI Websites” means,
collectively, the Chinese language website found at bowenwang.com.cn, and all
other websites (be they Chinese language or non-Chinese language) owned or
controlled by HSWI or its Affiliates whether presently existing or later
developed, and all successor websites to any of the foregoing
websites

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      1.20 “Images” means illustrative
materials, including but not limited to charts, graphs, photographs, tables and
renderings wholly owned by World Book and licensed to HSWI.

       

      1.21 “Intellectual Property Rights”
means any and all rights, titles and interests, whether foreign or domestic, in
and to any and all trade secrets, patents, copyrights, service marks,
trademarks, know-how, or similar intellectual property rights, as well as any
and all moral rights, rights of droit moral, rights of privacy, publicity and
similar rights of any type under the laws or regulations of any governmental,
regulatory, or judicial authority, foreign or domestic.

       

      1.22 “Net Revenue” means gross
revenue less costs not to exceed [*] percent ([*]%) of such gross revenue,
including reasonable third-party agency/ third-party advertising sales
commissions and rebates and serving, bad debts and applicable
taxes.

       

      1.23 “Open Free Web” means all
websites (i) through which content can be indexed by Google and/or other
consumer search engines; (ii) through which content is openly accessible by the
public free of charge, and/or (iii) that do not charge a subscription fee or
other fee for access to the content of the website.

       

      1.24 ”Reference Content” means
content created from various World Book digital databases, print products,
outside reference sources or materials acquired by World Book and which shall be
provided in simplified Chinese characters and shall consist of sixteen million
(16,000,000) to [*] ([*]) Chinese characters.

       

      1.25 “Royalties” means fees payable
by HSWI to World Book and calculated on the basis set forth in Section 4.1
hereof.

       

      1.26 “Significant Breach” means an
uncured breach (pursuant to the cure provisions of Section 6.2(i)) by HSWI of one or more of the
following:

       

      (i)     HSWI
brands the Affinities with the word “Encyclopedia” and/or Displays the
Affinities or the underlying Reference Content and/or Images as an Encyclopedia
in breach of Section 2.2(iii);

       

      (ii)     HSWI
uses or Displays the World Book Brand to promote the Content in violation of
Section 7.4;

       

      (iii)     HSWI assigns
this Agreement to a Competitor (as defined in Section 11.8) of
World Book in violation of Section 11.8;
and/or

       

      (iv)     HSWI fails to
make payments as required by Section
4.

       

      1.27 “Translated Content” means
non-Chinese versions of the Affinities and/or the Reference Content, created
pursuant to Section 2.3.

       

      [*] Confidential treatment
requested; certain information omitted and filed separately with the
SEC.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      1.28 “Updating Services” means that
upon World Book’s update to or maintenance of the World Book Online Reference
Center or the Reference Content, World Book will provide notice, a reference to
the affected Articles, and the actual content of the update to HSWI so that HSWI
can update and maintain the factual data in the Affinities.  Such
services shall be of the scope and nature with which World Book updates and
maintains its content in the normal course of its own updating and maintenance
process.

       

      1.29 “World Book Brand” is defined
in Section
7.4
hereof.

       

      1.30 “World Book Derivatives” means
any modifications, updates or other derivative works to the Content based on
other Content provided by World Book regardless of who performs such
modifications, updates or other derivative works.

       

      1.31 “World Book Online Reference
Center” means World Book’s online product found at
www.worldbookonline.com or any successor URL thereto.

       

      2. LICENSE
GRANT.

       

      2.1 License
Grant and Restrictions.

       

      (i) License
Grant.  Subject to the terms and conditions set forth herein,
World Book hereby grants to HSWI, a perpetual, irrevocable limited license to
use, copy, store, archive, distribute, transmit, modify (subject to Section 2.1(iv)), and Display
the Content, Images and Affinities in whole or in part, only on the HSWI
Websites or in promotions in any media for the HSWI Websites.  The
license to each component of the Content, Images and Affinities shall be subject
to the term and exclusivity provisions set forth in this Section 2.  The
license to each component of the Content, Images and Affinities shall be
supplemented by any additional license rights in this Section 2, and in the event
of any conflict with this Section 2.1 such other
additional license rights in this Section 2 shall
prevail.  

       

      (ii) Right to
Sublicense.  World Book further grants HSWI the right to
sub-license the Content, Images and Affinities to users of the HSWI Websites to
view, to store, and to make reasonable copies of the Content, Images and
Affinities to use such Content, Images and Affinities for non-commercial,
private purposes, provided that HSWI sets forth the limited terms of such
sublicense in writing in the HSWI Websites’ terms and conditions.  In
addition, World Book grants HSWI the right to sub-license the Content for
business development purposes, with no more than [*] ([*]%) of the Content being
licensed to any single third party, and in limited, non-material usage in other
mediums for promotional or public relations purposes.  HSWI may not
sublicense the Content, Images or
Affinities to any paid-subscription website which is an aggregator of
third-party content (for the avoidance of doubt, such shall not include the

       

      
        [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

           

        

      

      HSWI
Websites).  Notwithstanding anything to the contrary herein, attached
as Attachment B
is a list of companies (the “Competitors II”) which are competitors
with World Book and to whom sublicense may be made only with prior written
consent of World Book, which World Book may withhold at its sole
discretion.  The Competitors II may be modified from time to time by
notice to and approval of the other party, not to be unreasonably
withheld.  HSWI shall provide World Book on or before June 30th and
December 31st of each year with a list of third parties to whom sublicense
hereunder has been made during such semiannum.

       

      (iii) No Other
Rights.  Except as set forth herein, HSWI has no other right to
sublicense the Content except with the advance written consent of World
Book.  World Book retains all rights not specifically granted
herein.

       

      (iv) Restrictions.  The
Content and Images shall be available to Display on the HSWI Websites as one or
more individual articles, via commercially available browsers using personal
computers, mobile devices, kiosks, or other equipment.  HSWI may
modify the Content, including using excerpts, for purposes of exercising its
rights under this Agreement, including without limitation, to fit the format and
the look-and-feel of the HSWI Websites, for promotion of the Content or HSWI
Websites, for allowing third parties to sponsor certain Content, and to include
links in the Content to HSWI Websites or third party websites; provided,
however, HSWI may not edit, modify, or create derivative works from the Content
for purposes of changing the substantive information contained in the Content,
except (i) as otherwise approved by World Book in writing; or (ii) as otherwise
expressly provided in this Agreement.  HSWI may not Display the
Content or Images on any website which is pornographic.  HSWI may not
translate the Content provided by World Book hereunder except as set forth in
Section 2.3 or for purposes of performing updates.

       

      (v) Third Party Service Provider
Rights.  HSWI may permit third party suppliers of services and
facilities (including, without limitation, agents, consultants, host providers,
data centers, outsource service providers, disaster backup and recovery service
providers) to use the Content, Images and Affinities under the terms of this
Agreement in support of HSWI exercising its rights under this
Agreement.  HSWI also may designate one or more third party suppliers
of services as HSWI’s agent for the administration of this Agreement and the
receipt of services under this Agreement from World Book.

       

      (vi) Affiliate Rights. All
rights granted to HSWI under this Agreement may be exercised by or through HSWI
and/or its Affiliates.

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      2.2 Affinities.

       

      (i) Creation.  World
Book shall create and deliver the Affinities in the Delivery
Period.  The Affinities will be organized into stand-alone articles
around specific topics (each, an “Article”) according to the
taxonomy set forth in Schedule
A.  Any given Affinity will consist of multiple Articles in the
same subject area (i.e., history or life sciences).  There shall be at
least one Article for each of those topics identified in Schedule
B.  World Book shall create the Affinities based on Reference
Content and other content owned or licensed by World Book, including without
limitation, various World Book digital databases, print products, outside
reference sources or materials acquired by World Book.  World Book
will make reasonable efforts to cross check the Reference Content against other
World Book products for factual accuracy.  World Book will create the
Affinities according to the guidelines and instructions provided by HSWI from
time to time, and agreed to by World Book whose consent shall not be
unreasonably withheld, and according to the high quality standards for
commercially published works, but in no event less than the standards of World
Book for its own published works.  If an Affinity does not meet the
requirements set forth herein, World Book will promptly revise the Affinity to
meet such.  The total amount of material World Book makes available
for all Affinities shall be no less than sixteen million (16,000,000) Chinese
characters.  Additionally, the Affinities shall collectively contain
at least sixteen thousand (16,000) Articles written in simplified Chinese
characters, with an average and median number of words per Article of no less
than one thousand (1,000) simplified Chinese characters.

       

      (ii) Delivery.  World
Book will deliver at least [*] percent ([*]%) of the Articles in the Affinities
on or before [*], and at least [*] percent ([*]%) on or before the
[*].  World Book will deliver the Affinities according to the
following schedule.

       

      
      

       

      
        	 	
                Date
      for Delivery

              	
                 Affinities
      for Delivery

              
	 	 	a)           [*]
	 	Prior
      to [*]	b)           [*]
	 	 	c)           [*]
	 	 	a)           [*]
	 	 	b)           [*]
	 	
                Prior
      to [*]

              	c)           [*]
	 	 	d)           [*]
	 	 	e)           [*]
	 	 	
                
                  
                    f)           
      [*]

                  

                

              

      

       

       

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      The
format and media for the delivery of the Affinities, such as FTP or other
mutually-agreeable method, and the XML schema and applicable metadata
requirements are set forth in Schedule
C.

       

      (iii) Scope of License for
Affinity & Content Included in Affinity.  Subject to the
terms and conditions of this Agreement, World Book grants HSWI the right to use,
copy, store, archive, distribute, transmit, modify, translate (subject to Section 2.3), and
Display the Content that comprises the Affinities as part of the Affinities, and
the Affinities themselves, in any manner and in any digital media (and to
sublicense such rights to third parties), provided that HSWI does not resell all
or license substantially all of the Content for a fee to other content
publishers.  The term of the license for the Content delivered to HSWI
as part of the Affinities, and the Affinities themselves, shall be perpetual,
Exclusive, and irrevocable.  World Book shall have no right to allow
any party other than HSWI, including World Book, to publish, distribute,
duplicate, or otherwise use the Reference Content that comprises the Affinities
on the Open Free Web for purposes of creating any materials that are the same or
similar to the Affinities and published online or in any other free digital
media.  World Book shall have no right to use the Reference Content
that comprises the Affinities on the Open Free Web except for purposes of
performing its obligations to HSWI under this Agreement.  HSWI may not
brand the Affinities with the word “Encyclopedia.”  Notwithstanding
anything to the contrary in this Agreement, the Affinities or the underlying
Reference Content and/or Images may not be Displayed as an
Encyclopedia.  World Book shall not license to any third parties or
otherwise use the Content as Affinities in any digital form during the term of
the license.

       

      (iv) Scope of License for Images
Included in Affinity.  World Book grants HSWI the right to use,
copy, store, archive, distribute, transmit, modify, translate (subject to Section 2.3), and
Display the Images as part of the Affinity.  The term of the license
for the Images delivered to HSWI as part of the Affinity, shall be perpetual and
irrevocable.  [*] ([*]) of the Images shall be Exclusive for the Open
Free Web.

       

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      2.3 Translated
Content.

       

      (i) Right to Create Translated
Content.  Where rights permit, HSWI shall have the right to
translate the Affinities for Display on the Open Free Web on HSWI Websites. HSWI
shall, promptly after creating such Translated Content, provide World Book with
a copy of the Translated Content in a format and manner acceptable to the
parties.  HSWI shall advise World Book that it desires to translate
the Affinities prior to commencing such translation and World Book shall notify
HSWI if World Book does not hold the rights necessary to allow HSWI to translate
any Articles or portions thereof.  HSWI may not Display the Translated
Content as an Encyclopedia, and may not translate any Affinity for which a same
subject-matter Affinity has not been previously licensed by HowStuffWorks,
Inc.  Additionally, if HSWI translates any of the Affinities into
English, HSWI’s sole rights to publish such English Translated Content shall be
as a translation on those foreign language HSWI Websites which are not intended
for English-language audiences.  Notwithstanding the foregoing, HSWI
may not translate any Affinity into English for which a same subject Affinity
has not been previously licensed by World Book to HowStuffWorks,
Inc.

       

      (ii) Scope of
License.  The term of the license for Translated Content shall
be for a term of [*] ([*]) years from the time such Translated Content is first
Displayed on an HSWI Website.  In addition, such license for
Translated Content shall be Exclusive for Display on the Open Free
Web.  At the end of such [*] ([*]) year period, HSWI shall have the
right to renew the Agreement under materially the same terms or shall have an
option to purchase the Translated Content outright to the extent rights permit
and to the extent the parties mutually agree to terms for such
sale.

       

      2.4 Non-Display.  HSWI
may, in its sole discretion, decide not to Display Content obtained from World
Book.  If HSWI elects in a written notice to World Book that HSWI will
not Display any such Content, notwithstanding anything to the contrary herein,
the license to such Content shall be non-Exclusive.

       

      2.5 Exclusivity.  Commencing
on the Effective Date and continuing for eighteen (18) months, World Book shall
work exclusively with HSWI to publish Chinese language Content for the Open Free
Web and shall not itself, directly or indirectly, publish Chinese language
Content for the Open Free Web.  For purposes of clarity, and except as
otherwise set forth herein, World Book maintains the right to continue to
publish Content and Images for its paid-subscription websites and other existing
or new partner paid-subscription websites, provided that such are not within the
definition of the Open Free Web.  Additionally commencing on the
Effective Date and continuing for eighteen (18) months, World Book shall offer
HSWI a right of first refusal to create any paid-subscription Chinese language
websites, which do not exist as of the date hereof, using the Content on equal
or better terms as agreed to between World Book and a third party.

       

       

      
        [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
           

        

      

      2.6 Updating Services.
World Book shall provide Updating Services to HSWI until the later of: (a) such
time as World Book’s cessation of providing Updating Services to HowStuffWorks,
Inc. or its successor, but such Updating Services shall be only for the same
Content under this Agreement for which World Book is obligated to provide
Updating Services to HowStuffWorks, Inc. or its successor; (b) such time as the
Royalties paid in a given year are less than $[*]; or (c) [*] years from the
Effective Date.  World Book shall provide the updates in the manner
and form as set forth in Schedule
D.  HSWI acknowledges that the Updating Services will not be
automated and may require review and editing by HSWI.  Notwithstanding
anything to the contrary, HSWI shall have the right to update the Content,
Affinity and Images to correct errors or alleged errors (including, without
limitation, errors of omission) in such or in response to third party claims
related to the Content, Images or Affinity, and may use World Book content and
data in connection with such updates.  World Book shall provide the
Updating Services in English, and HSWI may translate any such updates into
Chinese only.  Any authored content provided under the Updating
Services, even when translated into Chinese by HSWI, shall be subject to the
license herein for that Content which is being updated, and for the avoidance of
doubt shall not be considered Translated Content.

       

      3. INTELLECTUAL
PROPERTY RIGHTS; OWNERSHIP AND LICENSES.

       

      3.1 World Book’s Ownership
Rights.  World Book shall own all right, title and interest,
including all Intellectual Property Rights, in and to the Content and in all
Intellectual Property Rights in the Content, including, without limitation,
World Book Brands (as defined in Section 7.4) and any
derivative works to any of the foregoing.  HSWI shall have no
proprietary interest in the Content, other than the license rights set forth
herein.

       

      3.2 HSWI’s Ownership
Rights.  HSWI shall own all right, title and interest,
including all Intellectual Property Rights, in and to (i) the HSWI Websites,
their look and feel and the software code or web site infrastructure that it
develops, licenses, or purchases to support Display of the Content; and (ii) the
HSWI Modifications.

       

      3.3 Documents.  Each
party agrees (without further compensation) to execute any applications,
agreements and instruments and to do all other things reasonably requested by
the other party, at the requesting party’s expense (both during and after the
term of this Agreement) in order to vest the rights provided in this
Agreement.

       

      4. PAYMENT.

       

      4.1 Royalties.

       

      (i) Royalty
Rates.  HSWI shall pay to World Book Royalties calculated as a
defined percentage of the Net Revenue received by HSWI from 

       

       

      
        [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

        
          
            
            

          

          
            
            

            
              

            

          

           

          
            advertising
generated directly from Content by web pages containing Content or any portion
of the Content provided by World Book to HSWI hereunder.  The Royalty
rate shall be [*] percent ([*]%) on the Affinities
and Reference Content; and [*] percent ([*]%) on Translated
Content.

          

        

      

       

      (ii) Payments/Advances.  During
the applicable Contract Period, HSWI shall pay World Book non-refundable
advances towards the Royalties in the amounts set forth below ( “Payments/Advances”):

       

      
        	 	 	
                Due
      Date

              	
                 Amount

              
	 	 	 [*]	
                 $[*]

              
	 	 [*]	 [*]	
                 $[*]

              
	 	 	 [*]	
                 $[*]

              
	 	 	 [*]	
                 $[*]

              
	 	 	 [*]	
                 $[*]

              
	 	 [*]	 [*]	
                 $[*]

              
	 	 	 [*]	
                 $[*]

              
	 	 	 [*]	
                 $[*]

              
	 	 	 TOTAL	
                 $[*]

              

      

       

      World
Book will submit invoices to HSWI for the Payments/Advances at least [*] ([*])
days prior to the due date of such Payment/Advance, with the exception of the
first payment which shall be due [*].  No Royalty payments will be due
until the amount of the Royalties exceed the amount of the Payments/Advances
described above for the development and delivery of the Affinities and Content
licensed hereunder, and then Royalties will only be owed for any Royalties in
excess of the amount of the Payments/Advances, as further detailed in the
following Sub-Section.  If, subsequent to the Effective Date and prior
to the end of 2009, HowStuffWorks, Inc. enters into one or more new agreements
or modifies an existing agreement with World Book to license content with
guaranteed payment obligations in such new agreement or in such modification
totaling at least [*] dollars ($[*]) in additional fees, then each of HSWI’s
[*], and [*], [*] shall be reduced from $[*] to $[*].  Nothing paid in
Contract Period 1 pursuant to the [*], as amended shall be used to calculate
guaranteed payment obligations hereunder.

       

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      (iii) Calculation and Payment of
Excess Royalties.  Royalties for Content will be calculated
based on the Royalty rates set forth in Subsection (i) and compared to the
Payments/Advances paid by HSWI during the term of this Agreement.  If
such calculated Royalties exceed all Payments/Advances paid during the term of
this Agreement (“Excess
Royalties”), HSWI
will pay such Excess Royalties within [*] ([*]) days after the end of the
calendar year in which such Excess Royalties were
earned.  Additionally, within [*] ([*]) days after the end of each
calendar year, HSWI will provide to World Book a report of its Royalty
calculations.  If Excess Royalties are earned before all
Payments/Advances have been paid, the Excess Royalties will be deducted from
future Payments/Advances.  In the event that Royalties are [*] than
Payments/Advances, [*].  By way of example, if the calculated
Royalties for 2008 are $[*].  Royalty statements shall be final and
accepted by the parties unless World Book has, in good faith, notified HSWI of
the amount and specific reasons for the dispute within [*] ([*]) days from the date
of the statement. 

       

      4.2 Buy-Out
Option.  HSWI shall have the right at any time following [*] to
pay World Book a single fee (the “Buy-Out Fee”), the payment of
which would eliminate HSWI’s obligation to pay any further Excess
Royalties.  The Buy-Out Fee shall be the [*] of: a) the amount [*], or
b) an amount equal to [*] times the calculated Royalties of the most recent
calendar year.

       

      4.3 Taxes.  To
the extent required, HSWI shall pay all sales, use or similar state or local
taxes in connection with this Agreement, except for employment taxes or taxes
related to World Book’s income.

       

      5. AUDIT.  HSWI
shall maintain complete and accurate records to support and document the
Royalties owed under this Agreement in accordance with generally accepted
accounting principles consistently applied and to document compliance with the
terms of this Agreement.  HSWI shall also provide reasonable
assistance to World Book or its designated agent to conduct audits to confirm
the payments hereunder.  Any such audit will be conducted upon [*]
([*]) days notice and during regular business hours, and shall be at [*]
expense, unless such audit reveals a discrepancy of more than [*] percent ([*]%)
in the total applicable amount reported by HSWI, in which case [*] shall pay
for, or reimburse [*] the cost of, such audit.  Any such audit shall
be conducted by an independent certified public accounting firm which is not
engaged in performing other work for World Book or its affiliates; which agrees
to enter into a confidentiality agreement with HSWI; and which is not
compensated in any manner of contingency arrangements on the basis of its
findings.  HSWI further agrees that until the expiration of [*] ([*])
year after the termination of this Agreement, HSWI will make available upon
written request to World Book or any of its duly authorized representatives,
this Agreement and books, documents, and records of HSWI that are necessary to
verify the nature and extent of the revenue derived by HSWI from advertising
related to the Content hereunder.  No more than [*] audit may be
conducted in any [*] month period, unless the then-most-recent audit reveals a
discrepancy of more than [*] percent ([*]%) in the total applicable amount
reported by HSWI.

       

      [*] Confidential treatment
requested; certain information omitted and filed separately with the SEC.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
         

        6. TERM,
EXTENSION, AND TERMINATION.

      

       

      6.1 Term.

       

      (i) Term of
Agreement.  This Agreement shall commence on the Effective Date
and, except as set forth in Subsection (ii),
continue in full force and effect through the Delivery Period.

       

      (ii) Term of
Licenses.  Notwithstanding Subsection (i),
certain license grants for Content, Images and Affinities extend beyond the
expiration or earlier termination of this Agreement as set forth
herein.  With respect to such Content, Images and Affinities, the
terms and conditions of this Agreement shall continue to apply.

       

      6.2 Termination for Cause or
Bankruptcy.  This Agreement may be terminated by a party in the
event of:

       

      (i) any
material default in, or material breach of, any of the material terms and
conditions of this Agreement by the other party, which default continues in
effect after the defaulting party has been provided with written notice of
default and sixty (60) days to cure such default;

       

      (ii) the
commencement of a voluntary case or other voluntary proceeding seeking
liquidation, reorganization or other relief with respect to the other party of
its debts under any bankruptcy, insolvency, or other similar law now or
hereafter in effect, that authorizes the reorganization or liquidation of such
other party or its debt or the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of its
property;

       

      (iii) the
other party’s consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it; or

       

      (iv) the
other party’s making a general assignment for the benefit of creditors; or the
other party’s being adjudicated insolvent; or the other party taking any
corporate action to authorize any of the foregoing.

       

      6.3 Effect of
Termination.  Upon the expiration or termination of this
Agreement, HSWI shall pay World Book all amounts due and owing up to the date of
termination, within [*] ([*]) days after such expiration or
termination.  In addition, upon the expiration or termination of the
applicable license, HSWI shall cease to Display the applicable Content that is
not licensed under a perpetual license, return or destroy such Content within
[*] ([*]) days after such expiration or termination at the direction of World
Book, and, upon request by World Book, certify completion of the return or
destruction in writing.  There shall be no effect upon the applicable
Content that is licensed under a perpetual license.

       

      [*] Confidential treatment
requested; certain information omitted and filed separately with the SEC.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
         

      

      6.4 Remedies.  The
termination or expiration of this Agreement for any reason shall not affect
either party’s rights or obligations arising prior to the effective date of such
termination.  For purposes of clarification, upon a Significant Breach
of this Agreement by HSWI which remains uncured, the rights to publicly use the
World Book Brand as set forth in Section 7.4 may be
revoked by World Book.  Notwithstanding anything in this Agreement to
the contrary, the rights and remedies of the parties as set forth in this
Agreement are not exclusive and are in addition to any other rights and remedies
available to it at law or in equity.

       

      6.5 Equitable
Relief.  Each party acknowledges that its breach of certain
provisions of this Agreement would cause irreparable injury to the other party
for which monetary damages may not be an adequate
remedy.  Accordingly, each party will be entitled to seek injunctions
and other equitable remedies in the event of such a breach or threatened breach
by the other party, or to seek specific performance of any provision
hereof.  A party’s right to seek equitable relief shall not limit in
any manner such party’s respective rights to seek other and/or additional
remedies at law or in equity.

       

      7. CONFIDENTIALITY.

       

      7.1 Protection of Confidential
Information.  Solely for the purposes of the use and disclosure
of Confidential Information, each of World Book and HSWI is defined to include
such party’s directors, officers, employees, legal counsel, and consultants,
with a need to know, and who are advised by such party of the confidential
nature of the information or who are required to execute a nondisclosure
agreement with the confidentiality terms at least as restrictive in all material
respects as set forth in this Agreement.  Each party shall maintain
all of the Confidential Information disclosed to it by the other party in strict
confidence and will protect such information with the same degree of care that
each party exercises with its own Confidential Information, but in no event less
than a reasonable degree of care.  Each party may use the Confidential
Information disclosed to it by the other party only to perform its obligations
under this Agreement.  Except
as provided in this Agreement, neither party shall use or disclose any
Confidential Information disclosed to it by the other party without the express
prior written consent of such disclosing party.  Neither party shall
decompile, disassemble, or reverse engineer any Confidential Information
disclosed to such party by the other party, and any information derived in
violation of such covenant shall automatically be deemed Confidential
Information.  All of the Confidential Information, and all copies,
extracts, summaries and other reproductions thereof, shall be and remain the
property of the respective disclosing party.  Upon written request or
upon the expiration of this Agreement, all Confidential Information (and all
copies thereof) will be returned to the party disclosing such or destroyed, with
written certification thereof, except that one archival copy of written material
to be kept confidential and segregated from the parties’ regular files may be
retained by each party’s legal counsel solely for purposes of verifying
compliance with this Agreement.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      7.2 Disclosures Required by
Law.  If a party is required to disclose Confidential
Information received from the other party, by law or a governmental authority,
including, without limitation, pursuant to a subpoena, court order,
interrogatories, civil investigation demand, or other process, such Confidential
Information may be disclosed, provided that the disclosing party, if permitted:
(a) promptly notifies the other party  of the disclosure requirement;
(b) cooperates with the other party’s efforts to resist or narrow the disclosure
and to obtain an order or other reliable assurance that confidential treatment
will be accorded Confidential Information; and (c) furnishes only Confidential
Information that is legally compelled to be disclosed according to advice of its
legal counsel.

       

      7.3 Disclosures to
Investors.  HSWI may disclose the contents of this Agreement to
promote investment to potential financial investors or institutions, provided
that such parties are subject to a confidentiality agreement at least as
restrictive in all material respects as the confidentiality terms in this
Agreement.

       

      7.4 Use of World Book
Brand.  Except as set forth herein, neither party shall issue
any press releases or public statements concerning this Agreement or the subject
matter herein without the other party’s prior written agreement, except as
required by law.  World Book grants no right to HSWI for the use or
Display of World Book’s brands, logos, service marks, or other trade names or
trademarks of World Book (“World Book Brand”) in any
manner, except as permitted in this Section.  HSWI may not use the
World Book Brand to promote the Content on any of the HSWI Websites to existing
or potential users.  HSWI may use World Book’s name solely to promote
advertising or investment to potential advertising clients or financial
investors or institutions.  Notwithstanding the foregoing, and subject
to the terms and conditions of this Agreement, HSWI may identify the Content on
the HSWI Websites and elsewhere as “From the editors of World Book, Inc.,” in
simplified Chinese language as set forth in Schedule E or such
other credit or credits as the parties hereto may mutually agree in writing,
except for any of that Content which has been modified without the approval of
World Book.  Additionally, World Book agrees to cooperate with HSWI’s
issuing a press release
within one month of entering into this Agreement which identifies HSWI as
receiving exclusive content created by World Book and includes relevant quotes
from World Book executives.  Any press releases issued by HSWI
including the World Book Brand shall be previously approved in writing by World
Book, which consent shall not be unreasonably withheld.

       

      7.5 Required
Disclosures.  Notwithstanding the foregoing, World Book
acknowledges that HSWI is a publicly listed company subject to various
disclosure regulations.  In connection with such, World Book
acknowledges that HSWI may disclose in its regulatory filings, investor
communications, and associated statements the World Book Brand and those aspects
of this Agreement that HSWI reasonably finds are required to be disclosed by law
or regulation.  HSWI will use its commercially reasonable efforts to
consult with World
Book on any such legally required public disclosures of the World Book Brand and
this Agreement.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      7.6 The
restrictions on use and disclosure of Confidential Information under this Section 7 shall
remain in effect [*] ([*]) years following disclosure of the Confidential
Information; provided, however, for trade secrets such restrictions shall
continue for so long as such information is deemed a trade secret under
applicable law.

       

      8. REPRESENTATIONS
AND WARRANTIES.

       

      8.1 Mutual
Representations.  Each party represents and warrants to the
other party that:

       

      (i) It is
duly organized and validly existing under the laws of the jurisdiction of its
organization or incorporation and, if relevant under such laws, in good
standing;

       

      (ii) It has
the corporate and/or other legal capacity, authority and power to execute,
deliver, and perform its obligations under this Agreement and any other document
relating hereto to which it is a party, and has taken all necessary action to
authorize such execution, delivery and performance;

       

      (iii) Such
execution, delivery and performance do not violate or conflict with any law
applicable to it, any provision of its constitutional documents, any order or
judgment of any court or other agency of government applicable to it or any of
its assets or any contractual restriction binding on or affecting it or any of
its assets;

       

      (iv) All
governmental and other authorizations, approvals, consents, notices and filings
that are required to have been obtained or submitted by it with respect to this
Agreement and any other document relating hereto to which it is a party have
been obtained or submitted and are in full force and
effect and all conditions of any such authorizations, approvals, consents,
notices and filings have been complied with;

       

      (v) Its
obligations under this Agreement and any other document relating hereto or
thereto to which it is a party constitute its legal, valid and binding
obligations, enforceable in accordance with their respective terms;

       

      (vi) There
is not pending or, to its knowledge, threatened against it any action, suit or
proceeding at law or in equity or before any court, tribunal, governmental body,
agency or official or any arbitrator that is likely to affect the legality,
validity or enforceability against it of this Agreement or any other document
relating hereto to which it is a party or its ability to perform its obligations
under the same;

       

       

      
        [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
           

        

      

      (vii) There
is not pending or, to its knowledge, threatened against it any action, suit or
proceeding at law or in equity or before any court, tribunal, governmental body,
agency or official or any arbitrator related to the violation of the
Intellectual Property Rights of a third party related to the subject matter of
this Agreement; and

       

      (viii) It is
not relying upon any representations of the other party other than those
expressly set forth in this Agreement or any other document relating
hereto.

       

      8.2 HSWI’s Representations and
Warranties.  HSWI hereby represents and warrants that it has
all applicable rights in and to the HSWI Websites and the HSWI Websites do not
and will not infringe or misappropriate the Intellectual
Property  Rights of any third persons.

       

      8.3 World Book’s Representations
and Warranties.  World Book hereby represents and warrants
that:

       

      (i) it has
all applicable rights in and to the Content and the Content does not and will
not infringe or misappropriate any Intellectual Property Rights of any third
persons;

       

      (ii) it will
perform all services in a professional, diligent, and workmanlike
manner;

       

      (iii) the
Content will be free from material errors or inaccuracies;

       

      (iv) the
Content will comply with all laws and regulations of the People’s Republic of
China, including without limitation for distribution, publication and
educational use as contemplated herein; and,

       

      (v) the
Content as delivered by World Book is expressly approved by or within the
applicable guidelines of the national government, any ministries, and provincial
governments, as applicable, of the People’s Republic
of China for distribution, publication and education use as contemplated
herein.

       

      
        In the
event of a breach of the foregoing warranties, and without limitation to any
other remedies of HSWI, World Book shall promptly remedy the breach at no
additional cost or expense to HSWI.

         

        8.4 Disclaimer.  EXCEPT
AS SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY OTHER REPRESENTATIONS OR
WARRANTIES, INCLUDING, WITHOUT LIMITATION, AS TO THE ACCURACY OR COMPLETENESS OF
THE CONTENT.  TO THE FULL EXTENT ALLOWED BY APPLICABLE LAW, EACH PARTY
DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS, IMPLIED, STATUTORY, OR
OTHERWISE INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR USE OR PURPOSE.

         

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      9. INDEMNIFICATION.

       

      9.1 HSWI  HSWI
hereby agrees to defend, indemnify and hold harmless World Book and its
officers, directors, agents, and employees from all costs, damages, liabilities
and expenses (including reasonable attorneys fees) arising out of: (a) any third
party claim or action alleging that any of the following infringe or
misappropriate the Intellectual Property Rights of a third party: (i) the HSWI
Websites or the HSWI trade dress utilized in the Display of the Content on the
HSWI Websites; (ii) any Translated Content; or (iii) any HSWI Modifications and
any World Book Derivatives independently created by or on behalf of HSWI; and/or
(b) any third party claim or action arising out of HSWI’s material breach of
this Agreement; provided that (i) World Book notifies HSWI promptly in writing
of any such threat, claim, and/or proceedings related thereto; (ii) HSWI is
given the opportunity to assume sole control over the defense and all related
settlement negotiations, except that World Book shall have sole authority over
approval of any settlement that admits fault or liability on the part of World
Book; and, (iii) World Book provides HSWI with all reasonably necessary
assistance, information and authority to perform the foregoing at HSW’s
expense.  Notwithstanding anything to the contrary, the indemnity
under this Section shall not apply to the extent the Content provided by World
Book, or any accurate translation, contributes or results in an infringement or
misappropriation of the Intellectual Property Rights of a third
party.

       

      9.2 World
Book.  World Book hereby agrees to defend, indemnify and hold
harmless HSWI, its Affiliates, and their officers, directors, agents, employees,
advertisers, service providers, end users and related entities from all costs,
damages, liabilities and expenses (including reasonable attorneys fees) arising
out of: (a) any third party claim or action alleging that the Content,
Affinities and Images (excluding any World Book Derivatives independently
created by or on behalf of HSWI) in the manner delivered by World Book or as
contemplated for HSWI’s use hereunder infringes or misappropriates any
Intellectual Property Rights
of any third party; and/or (b) any third party claim or action arising out of
World Book’s material breach of this Agreement; provided that: (i) HSWI notifies
World Book promptly in writing of any such threat, claim, and/or proceedings
related thereto; (ii) World Book is given the opportunity to assume sole control
over the defense and all related settlement negotiations, except that HSWI shall
have sole authority over approval of any settlement that admits fault or
liability on the part of HSWI; and, (iii) HSWI provides World Book with all
reasonably necessary assistance, information and authority to perform the
foregoing at World Book’s expense.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      10. LIMITATIONS
OF LIABILITY.

       

      10.1 EXCEPT
FOR EITHER PARTY’S VIOLATION OF THE CONFIDENTIALITY OBLIGATIONS AND FOR EITHER
PARTY’S INDEMNIFICATION OBLIGATIONS, NEITHER PARTY SHALL BE LIABLE UNDER ANY
CONTRACT, NEGLIGENCE, STRICT LIABILITY, OR OTHER LEGAL OR EQUITABLE THEORY FOR
ANY AMOUNTS IN EXCESS IN THE AGGREGATE OF THE AMOUNT OF THE FEES PAID OR PAYABLE
UNDER THIS AGREEMENT.

       

      10.2 EXCEPT
FOR EITHER PARTY’S VIOLATION OF THE CONFIDENTIALITY OBLIGATIONS AND FOR EITHER
PARTY’S INDEMNIFICATION OBLIGATIONS, IN NO EVENT WILL EITHER PARTY BE LIABLE FOR
SPECIAL, INCIDENTAL, CONSEQUENTIAL, INDIRECT OR PUNITIVE DAMAGES, OR LOST
PROFITS, REGARDLESS OF WHETHER SUCH LIABILITY IS BASED ON BREACH OF CONTRACT,
TORT, STRICT LIABILITY, BREACH OF WARRANTIES, FAILURE OF ESSENTIAL PURPOSE OR
OTHERWISE AND EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

       

      11. MISCELLANEOUS
PROVISIONS.

       

      11.1 Force
Majeure.  In the event that either party is unable to perform
any of its obligations under this Agreement or to enjoy any of its benefits
because of any event beyond the control of the affected party including, but not
limited to, natural disaster, acts of God, actions or decrees of governmental
bodies or failure of communication lines (a “Force Majeure Event”), the
party who has been so affected shall promptly give written notice to the other
party and shall use commercially reasonable efforts to resume
performance.  Upon receipt of such notice, all obligations under this
Agreement shall be immediately suspended for the duration of such Force Majeure
Event.

       

      11.2 Notice.  All
notices, demands, requests or other communications required or permitted under
this Agreement will be deemed given when (i) personally delivered; (ii) upon
receipt after being sent by registered U.S. mail, return receipt requested; or
(iii) upon receipt after being sent by commercial overnight carrier service with
tracking capabilities to the address of the party set forth below, or
such
other address as such party last provided to the other party by written
notice.

       

      World
Book, Inc.

      233
North Michigan Avenue

      Suite
2000

      Chicago,
IL 60601

      Attn:
Chief Financial Officer

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      HSW
International, Inc.

      One
Capital City Plaza

      3350
Peachtree Road,

      Suite
1600

      Atlanta,
Georgia  30326

      Attn:
Chief Executive Officer

       

      with a
copy to:

       

      HSW
International, Inc.

      One
Capital City Plaza

      3350
Peachtree Road,

      Suite
1600

      Atlanta,
Georgia  30326

      Attn:
General Counsel

       

      11.3 Waiver.  Failure
to enforce any term of this Agreement at any time for any period shall not be
construed as a waiver of such rights.  No waiver shall be valid
against any party hereto unless made in writing and signed by the party against
whom enforcement of such waiver is sought and then only to the extent expressly
specified therein.

       

      11.4 Amendments.  No
changes or modifications to any provision of this Agreement shall be effective
unless made in writing and signed by both parties.

       

      11.5 Severability.  In
the event any one or more of the provisions of this Agreement shall for any
reason be held to be invalid, illegal or unenforceable, the remaining provisions
of this Agreement shall be unimpaired and the parties will substitute a new
enforceable provision of like economic intent and effect.

       

      11.6 Governing
Law.  This Agreement, the rights and obligations of the parties
hereto, and any claims or disputes thereto, shall be governed by and construed
in accordance with the laws of the State of New York without reference to
conflict of law principles.  Venue for any proceedings not subject to
arbitration under this Agreement shall be in the state and federal courts
located in New York, New York.

       

      11.7 Arbitration.  If
any dispute arises under this Agreement that is not settled promptly in the
ordinary course of business, the Parties shall seek to resolve any such dispute
between them; first, by negotiating promptly with each other in face-to-face
negotiations.  Any controversy or claim arising out of or relating to
the interpretation, enforcement or breach of this Agreement that cannot be
resolved within fifteen (15) business days (or such period as the Parties shall
otherwise agree) through face-to-face negotiations shall be resolved by binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association.  Arbitration shall be by a single arbitrator
mutually acceptable to the parties
and experienced in the matters at issue and selected by the Parties in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association.   If the parties are unable to agree upon a single
arbitrator, each party shall select an arbitrator and the two arbitrators shall
select the third arbitrator.  The arbitration shall only be held in
New York, New York.  The decision of the arbitrator shall be final and
binding and may be enforced in any court having jurisdiction over the subject
matter or either of the Parties, except that each party reserves all rights of
appeal.  The arbitrator(s) shall determine to what extent each of the
Parties shall bear the costs and expenses incurred in connection with any such
arbitration proceeding (including reasonable attorneys’ fees and expenses) on
the basis of the arbitrator’s assessment of the relative merits of the Parties’
positions.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      11.8 Assignment.  Except
as set forth herein, the parties shall not have any right or ability to assign,
transfer, or sublicense any obligations or benefit under this Agreement without
the prior written consent of the other party, which shall not be unreasonably
withheld, except that, upon written notice to the other party, a party (i) may
assign and transfer this Agreement and its rights and obligations hereunder to
any third party who succeeds to substantially all its business, stock, or assets
related to this Agreement, including, without limitation, to a Competitor (as
defined below) (an “Acquisition”); and (ii) may
assign or transfer any rights to receive payments
hereunder.  Notwithstanding the foregoing, attached as Attachment C is a
list of companies (the “Competitors”) to whom
assignment of this Agreement outside of an Acquisition may be made only with
prior written consent of the other party, which the other party may withhold at
its sole discretion.  Such list of Competitors may be modified from
time to time by notice to and approval of the other party, not to be
unreasonably withheld.  In the event of an assignment of this
Agreement in connection with an Acquisition of HSWI by any party other than a
Competitor, notwithstanding anything to the contrary herein, such acquiring
party’s license to the Content shall be expanded, to the extent the licenses are
available, to include also such acquiring party’s paid subscription site(s) (if
any) so long as: (i) such acquiring party’s paid subscription site(s) are
not primarily marketed to the school and/or library market; and (ii) such
Content is not provided to any Competitor or Competitor II; and (iii) the
Royalties shall also be calculated as the applicable defined percentage of the
Net Revenues
received by HSWI from subscription fees generated on the paid-subscription
websites where the Content is Displayed.  In addition, in the event of
an Acquisition of HSWI by a Competitor of World Book, in no event shall the
Content be provided to such Competitor or to any Competitor
II.  Notwithstanding the foregoing, nothing in this Agreement shall be
deemed to prevent an Acquisition of HSWI by any party, including without
limitation a Competitor.

       

      11.9 Additional Actions and
Documents.  Each of the parties hereto hereby agrees to take or
cause to be taken such further actions, to execute, deliver and file or cause to
be executed, delivered and filed such further documents, and will obtain such
consents, as may be necessary or as may be reasonably requested in
order to fully effectuate the purposes, terms and conditions of this
Agreement.  However, in no case will World Book be required to execute
any lien UCC documentation for public filing.

       

      11.10 Headings.  Section
headings contained in this Agreement are inserted for convenience or reference
only, shall not in no way affect the interpretation of any of the provisions
herein.

       

      11.11 Independent
Contractors.  Notwithstanding any provision hereof, for
purposes of this Agreement, each party shall be and act as an independent
contractor and not as a partner, a joint venturer, or an agent of the other
party, and shall not bind nor attempt to bind the other party in any way without
prior written consent.

       

      11.12 Survival.  Sections
1, 2, 3, 4, 6.1(ii), 6.3, 6.4, 6.5, 7, 8, 9, 10 and 11 shall survive the
expiration or termination of this Agreement for any reason.

       

      11.13 Entire
Agreement.  This Agreement, including all Attachments hereto,
constitutes the entire agreement of the parties and supersedes all proposals,
oral or written, all negotiations, conversations, discussions, or agreements
between the parties relating to the subject matter of this Agreement and all
past dealing or industry custom.

       

      [Signatures
Follow On Next Page]

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of its
Effective Date.

       

      AGREED:

       

      
        	
                HSW
      International, Inc.

              	 
      	
                WORLD
      BOOK, INC.

              
	 
      	 
      	 
      
	
                By:

              	  /s/ Bradley T. Zimmer    	 
      	
                By:

              	 
      /s/ Donald Keller
	 
      	 
      	 
      	 
      	 
      
	
                Name:

              	 
      Bradley T. Zimmer	 
      	
                Name:

              	 
      Donald Keller
	 
      	 
      	 
      	 
      	 
      
	
                Title:

              	 
      Executive Vice President & General Counsel	 
      	
                Title:

              	 
      VP & CFO
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

      

      

       

      

       

      

       

      

       

      

       

      

       

      

       

      LIST OF
ATTACHMENTS

       

      Attachment
A                                List
of HSWI Affiliates

       

      Attachment
B                                List
of Competitors II

       

      Attachment
C                                List
of Competitors

       

      Schedule
A                                    Taxonomy
Schedule

       

      Schedule
B                                    Article
Schedule

       

      Schedule
C                                    Format
and Delivery Schedule

       

      Schedule
D                                    Updating
Format

       

      Schedule
E                                    World
Book Brand Translation

       

      
        
          
             

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

      Attachment
A

       

      HSWI
AFFILIATES

       

      
        	
                1.  

              	
                HSW
      (HK) Inc. Limited

              

      

      
        	
                2.  

              	
                HSWI
      (HK) Holdings, Ltd.

              

      

      
        	
                3.  

              	
                HSW
      Brasil – Tecnologia e Informacao,
Ltda.

              

      

      
        	
                4.  

              	
                Bowenwang
      Technology (Beijing) Limited Liability
Company

              

      

      
        	
                5.  

              	
                HSW
      (PRC) Co.

              

      

      
        	
                6.  

              	
                BoNet
      (Beijing) Technology Limited

              

      

      
        	
                7.  

              	
                Intac
      International, Inc.

              

      

      
        	
                8.  

              	
                
                  [*]

                

              

      

      
        	
                9.  

              	
                
                  [*]

                

              

      

      
        	
                10.  

              	
                
                  [*]

                

              

      

      
        	
                11.  

              	
                
                  [*]

                

              

      

      

      

      

      [*] Confidential treatment
requested; certain information omitted and filed separately with the
SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Attachment
B

       

      COMPETITORS
II

              

      
        ·[*]

      

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      ·[*]

       

      

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Attachment
C

       

      COMPETITORS

       

      World Book
Competitors

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      
        	
                ·  

              	
                [*]

              

      

       

      

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
A

       

      AFFINITIES
TAXONOMY

       

      [*]

       

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
B

       

      ARTICLES

       

       

       

      The
topics for the Articles include the following, which may be expanded
upon.

       

      [*]

      

       

      [*] Confidential treatment requested; certain information omitted
and filed separately with the SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
C

       

      FORMAT &
DELIVERY

       

      To Be
Determined

       

      
 

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
D

       

      UPDATING
FORMAT

       

      Updating
Services shall be provided in the following or substantially similar format,
e-mailed by World Book to an address or addresses specified by
HSWI.  Data for such will be provided, expressed as [*], in the form
[*], or as World Book [*], in order by World Book [*].

      

      [*]

      [*]

      

      [*]

      

      [*]

      [*]

      

      [*]

      

      [*]

      

      [*]

      

      [*]

      

      

      [*] Confidential treatment
requested; certain information omitted and filed separately with the
SEC.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
E

       

      WORLD BOOK BRAND
TRANSLATION

       

      

       

      [*]

       

      

      [*] Confidential treatment
requested; certain information omitted and filed separately with the
SEC.ex10_1.htm

    
      EXHIBIT
        10.1

       

      

       

      Dated
        8
        May 2008

       

      Between

       

      Wafergen
        Bio-Systems Inc

       

      and

       

      Malaysian
        Technology Development Corporation Sdn Bhd

       

      and

       

      Wafergen
        Biosystems (M) Sdn Bhd (formerly known as Global Dupleks Sdn Bhd)

       

      

       

      

       

      

      
        Share
          Subscription and Shareholders’ Agreement

      

      
        Proposed
          subscription of shares in Wafergen Biosystems (M) Sdn Bhd (formerly known
          as
          Global Dupleks Sdn Bhd)

      

      
        

      

      
        

      

      
        
          
             

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      Contents

      

       

      Recitals 
        [INSERT PAGE NUMBER] 

       

      1           
        Definitions
        and Interpretations  [INSERT PAGE
        NUMBER] 

      1.1           
        Definitions 
        [INSERT PAGE NUMBER] 

      1.2           
        Interpretation 
        [INSERT PAGE NUMBER] 

       

      2.           
        Conditions
        Precedent  [INSERT PAGE NUMBER]

      2.1           
        Conditionality 
        [INSERT PAGE NUMBER] 

      2.2           
        Waiver 
        [INSERT PAGE NUMBER] 

      2.3           
        Non-fulfillment 
        [INSERT PAGE NUMBER] 

       

      3.           
        Share
        Capital  [INSERT PAGE NUMBER]

      3.1           
        Subscription
        for Preference Shares  [INSERT PAGE
        NUMBER] 

      3.2           
        Subscription
        for Shares  [INSERT PAGE NUMBER]

       

      4.           
        Subscription
        Completion Date  [INSERT PAGE NUMBER]

       

      5.           
        Undertakings,
        Warranties and Representations by the Parties  [INSERT PAGE NUMBER] 

       

      6.           
        Management
        of the Company  [INSERT PAGE NUMBER]

      6.1           
        Board
        of Directors  [INSERT PAGE NUMBER]

      6.2           
        Board
        Meetings  [INSERT PAGE NUMBER]

      6.3           
        Provisions
        in respect of meetings  [INSERT PAGE
        NUMBER] 

      6.4           
        Resolutions 
        [INSERT PAGE NUMBER] 

      6.5           
        Circular
        resolution  [INSERT PAGE NUMBER]

      6.6           
        No
        shareholding requirement  [INSERT PAGE
        NUMBER] 

      6.7           
        Management 
        [INSERT PAGE NUMBER] 

      6.8
                    Nominees 
        [INSERT PAGE NUMBER] 

       

      7.           
        General
        meetings  [INSERT PAGE NUMBER]

      7.1           
        General
        meetings  [INSERT PAGE NUMBER]

      7.2           
        Quorum 
        [INSERT PAGE NUMBER] 

      7.3           
        Decisions
        at meetings of the Shareholders  [INSERT PAGE NUMBER] 

      7.3.1           
        Ordinary
        Resolution  [INSERT PAGE NUMBER]

      7.3.2           
        Special
        Resolution  [INSERT PAGE NUMBER]

      7.4           
        Shareholder
        Reserve Matters  [INSERT PAGE NUMBER]

       

      8.           
        Business
        of the Company  [INSERT PAGE NUMBER]

       

      9           
        New
        Issues of Shares  [INSERT PAGE NUMBER]

      9.1           
        New
        Issues by Company  [INSERT PAGE NUMBER]

      9.2           
        Offer
        to Shareholders  [INSERT PAGE NUMBER]

       

      10.           
        Transfers,
        Acquisitions and Disposal of Shares  [INSERT PAGE NUMBER] 

      10.1           
        Pre-emption
        Rights  [INSERT PAGE NUMBER]

       

      11           
        Put
        Options  [INSERT PAGE NUMBER]

      11.1
                    Investor’s
        Put Option for shares in the Existing Shareholder  [INSERT PAGE NUMBER] 

      11.2
                    Investor’s
        Put Option for Conversion Shares  [INSERT PAGE NUMBER] 

       

      12.           
        Duration
        and Termination  [INSERT PAGE NUMBER]

       

      13.           
        Previous
        Agreements and Prevalence of Agreement  [INSERT PAGE NUMBER] 

       

      14.           
        Remedy
        on an Event of Default  [INSERT PAGE
        NUMBER] 

       

      15.           
        Confidentiality 
        [INSERT PAGE NUMBER] 

      
        
          
              | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

       

      

       

      16.           
        Deadlock 
        [INSERT PAGE NUMBER] 

      16.1           
        Disputes 
        [INSERT PAGE NUMBER] 

      16.2           
        Artificial
        Deadlock  [INSERT PAGE NUMBER]

       

      17.           
        Further
        Assurance  [INSERT PAGE NUMBER]

      19.1           
        Rights
        not affected  [INSERT PAGE NUMBER]

      19.2           
        Cumulative
        rights and remedies  [INSERT PAGE
        NUMBER] 

      19.3           
        Variation 
        [INSERT PAGE NUMBER] 

       

      20.           
        Severability 
        [INSERT PAGE NUMBER] 

       

      21.           
        Continuing
        Effect  [INSERT PAGE NUMBER]

       

      22.           
        Time 
        [INSERT PAGE NUMBER] 

       

      23.           
        Legal
        Relationship  [INSERT PAGE NUMBER]

       

      24.           
        Costs
        and Expenses  [INSERT PAGE NUMBER]

       

      25.           
        Assignment;
        Successors  [INSERT PAGE NUMBER]

      25.1           
        Assignment 
        [INSERT PAGE NUMBER] 

      25.2           
        Successors
        and assigns  [INSERT PAGE NUMBER]

       

      26.           
        Notices 
        [INSERT PAGE NUMBER] 

       

      27.           
        Entire
        agreement  [INSERT PAGE NUMBER]

       

      28.           
        Counterparts 
        [INSERT PAGE NUMBER] 

       

      29.
                    Governing
        Law and Jurisdiction  [INSERT PAGE
        NUMBER] 

       

      SCHEDULE
        1  [INSERT PAGE NUMBER]

      1.           
        Subscription
        Price and par value  [INSERT PAGE
        NUMBER] 

      2.           
        Premium 
        [INSERT PAGE NUMBER] 

      3.           
        Dividend
        Provision  [INSERT PAGE NUMBER]

      4.           
        Liquidation
        Preference  [INSERT PAGE NUMBER]

      5.           
        Conversion 
        [INSERT PAGE NUMBER] 

      6.           
        [Deleted] 
        [INSERT PAGE NUMBER] 

      7.           
        Redemption
        Rights  [INSERT PAGE NUMBER]

      8.           
        Voting
        Rights  [INSERT PAGE NUMBER]

      9.           
        Protective
        Provisions  [INSERT PAGE NUMBER]

      10.           
        No
        Variation  [INSERT PAGE NUMBER]

       

      SCHEDULE
        2  [INSERT PAGE NUMBER]

      1.           
        Representations
        and Warranties by the Investor  [INSERT
        PAGE NUMBER] 

      2.           
        Representations
        and Warranties by the Existing Shareholder and the Company  [INSERT PAGE NUMBER] 

       

      SCHEDULE
        3  [INSERT PAGE NUMBER]

       

      SCHEDULE
        4  [INSERT PAGE NUMBER]

       

      Execution 
        [INSERT PAGE NUMBER] 

       

      

      
        
          
             | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

      This
        Agreement is made
        on                                                                           
May 2008 between:

       

      
        	
                (1)

              	
                Wafergen
                  Bio-Systems, Inc (WGBS.OB), a Nevada USA incorporated company with
                  a
                  registered address and place of business at Bayside Technology
                  Center,
                  46531 Fremont Blvd, Fremont, CA 94538, USA (“Existing Shareholder”);
                  

              

      

      
        	
                 

              	
                and
                  

              

      

       

      
        	
                (2)

              	
                Malaysian
                  Technology Development Corporation Sdn Bhd (Company No 235796-U),
                  a
                  company incorporated in Malaysia with a registered address at Level
                  8-9,
                  Menara Yayasan Tun Razak, Jalan Bukit Bintang, 55100 Kuala Lumpur
                  (“MTDC);
                  

              

      

       

      
        	
                 

              	
                and
                  

              

      

       

      
        	
                (3)

              	
                Wafergen
                  Biosystems (M) Sdn Bhd (formerly known as Global Dupleks Sdn Bhd)
                  (Company
                  No 795066-H), a company incorporated in Malaysia with a registered
                  address
                  at Unit C-12-4, Megan Avenue 11, No 12, Jalan Yap Kwan Seng, 50450
                  Kuala
                  Lumpur (“Company”).
                  

              

      

       

      

       

       

      Recitals

       

      
        	
                (A)

              	
                The
                  Company is a private company limited by shares incorporated under
                  the laws
                  of Malaysia and has at the date of this Agreement an authorised
                  share
                  capital of RM100,000 divided into 100,000 ordinary shares of RM1.00
                  each .
                  

              

      

       

      
        	
                (B)

              	
                The
                  Existing Shareholder is the legal and beneficial owner of the entire
                  issued and paid-up share capital of the Company of RM2 divided
                  into 2
                  ordinary shares of RM1.00 each. 

              

      

       

      
        	
                (C)

              	
                The
                  Company shall increase its authorised share capital from RM100,000
                  divided
                  into 100,000 ordinary shares of RM1.00 each, to RM10,000,000 divided
                  into
                  8,000,000 ordinary shares of RM1.00 each and 200,000,000 redeemable
                  convertible preference shares of RM0.01 each.

              

      

       

      
        	
                (D)

              	
                The
                  Existing Shareholder and the Investor are desirous of undertaking
                  the
                  Business through the Company and agree to regulate their relationship
                  as
                  shareholders of the Company in accordance with the terms and conditions
                  of
                  this Agreement. 

              

      

       

      
        	
                (E)

              	
                The
                  Existing Shareholder and the Company intend to raise up to USD3,500,000
                  in
                  multiple tranches. The Existing Shareholder and the Company have
                  requested
                  the Investor to, and the Investor has agreed to, participate in
                  the
                  Company by way of subscription for the RCPS upon the terms and
                  subject to
                  the conditions set out in this Agreement.

              

      

       

      

       

      

       

      
        
          
             | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      It
        is agreed as follows:

       

      1           
        Definitions and Interpretations

       

       

      1.1           
        Definitions

       

       

      
        	
                 

              	
                In
                  this Agreement, unless the context otherwise requires:
                  

              

      

      

       

      
        	
                Act

                
                

              	
                means
                  the Companies Act 1965;

                
                

              
	
                Articles

                
                

              	
                means
                  the articles of association of the Company;

                
                

              
	
                Board

                
                

              	
                means
                  the board of directors of the Company;

              
	
                Business

                
                

              	
                means
                  the business of the Company as defined in Clause 8.1;

                
                

              
	
                Conversion
                  Shares

                
                

                
                

              	
                means
                  the Shares resulting from the conversion of the RCPS, such Conversion
                  Shares to rank pari passu in all respects with all other then existing
                  Shares, and “Conversion Share” means one of the Conversion
                  Shares;

                
                

              
	
                Director

                
                

              	
                means
                  any director of the Company appointed on the Board including, where
                  applicable, any alternate director;

                
                

              
	
                Initial
                  Closing

                
                

              	
                means
                  twenty one (21) days from the date of this Agreement or such later
                  date as
                  the Parties may mutually agree on;

                
                

              
	
                IPO

                
                

              	
                means
                  the listing of the Company on any approved stock exchange;

                
                

              
	
                Investor

                
                

              	
                means
                  MTDC, and any other person acceding to this Agreement;

                
                

              
	
                Encumbrance

                
                

              	
                means
                  any mortgage, charge, pledge, lien, assignment, hypothecation,
                  security
                  interest, title retention, right of first refusal, pre-emption
                  right,
                  option, preferential right or trust arrangement or other security
                  arrangement or agreement  conferring a right to a priority of
                  payment;

                
                

              
	
                RCPS

                
                

              	
                means
                  Series A Redeemable Convertible Preference Shares of the Company
                  with
                  principal terms as set out in Schedule 1;

                
                

              
	
                Parties

              	
                means
                  the Existing Shareholder, the Investor and the Company, and “Party” refers
                  to any one (1) of them;

                
                

              
	
                Series
                  A Director

              	
                means
                  the director as defined in Clause 6.1;

                
                

              
	
                Shareholders

              	
                means
                  the shareholders of the Company from time to time;

                
                

              
	
                Shares

              	
                means
                  ordinary shares of RM1.00 each in the share capital of the Company,
                  and
                  “Share”
refers
                  to
                  any one (1) of them;

                
                

              
	
                Subscription
                  Price

                
                

                
                

              	
                means
                  the Ringgit Malaysia equivalent to USD2.25 calculated at the prevailing
                  exchange rate on the date payment of the Subscription Price is
                  effected,
                  payable by the Investor for each RCPS under this Agreement, out
                  of which
                  RM0.01 is to be paid towards the par value of each RCPS and the
                  difference
                  between the Subscription Price and the par value of RM0.01 (constituting
                  the subscription premium) is to be credited to the share premium
                  account
                  of the Company;

                
                

              
	
                Subsequent
                  Closing

                
                

              	
                means
                  upon fulfilment of the milestones provided for in Clause
                  3.1.1(b);

                
                

              
	
                Tranche
                  A Shares

                
                

              	
                means
                  444,444 new RCPS of RM0.01 each in the Company to be issued at
                  an issue
                  price in Ringgit Malaysia equivalent to USD2.25 each;

                
                

              
	
                Tranche
                  B Shares

                
                

              	
                means
                  444,444 new RCPS of RM0.01 each in the Company to be issued at
                  an issue
                  price in Ringgit Malaysia equivalent to  USD2.25 each;
                  and

                
                

              
	
                Warranties

                
                

              	
                means
                  the representations and warranties made by the Investor, the
                  Existing  Shareholder and the Company, as set out in Schedule
                  2.

                
                

              

      

      

       

       

      1.2           
        Interpretation

       

       

      
        	
                 

              	
                In
                  this Agreement, unless the context otherwise requires:
                  

              

      

      
        	
                 

              	
                (a) 

              	
                headings
                  and underlining are for convenience only and do not affect the
                  interpretation of this Agreement; 

              

      

       

      
        	
                 

              	
                (b) 

              	
                words
                  importing the singular include the plural and vice versa;
                  

              

      

       

      
        	
                 

              	
                (c) 

              	
                words
                  importing a gender include any gender;

              

      

       

      
        	
                 

              	
                (d) 

              	
                an
                  expression importing a natural person includes any corporation
                  or other
                  body corporate, partnership, association, governmental agency,
                  two or more
                  persons having a joint or common interest, or any other legal or
                  commercial entity or undertaking; 

              

      

       

      
        	
                 

              	
                (e) 

              	
                a
                  reference to a party to a document includes that party's successors
                  and
                  permitted assigns; 

              

      

       

      
        
          
             
              | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      
        	
                 

              	
                (f) 

              	
                any
                  part of speech or grammatical form of a word or phrase defined
                  in this
                  Agreement has a corresponding meaning; and

              

      

       

      
        	
                 

              	
                (g) 

              	
                a
                  warranty, representation, covenant or agreement on the part of
                  two or more
                  persons binds them jointly and severally.

              

      

       

       

      2.           
        Conditions Precedent

       

       

      2.1           
        Conditionality

       

      The
        subscription for the RCPS by the Investor is subject to, and conditional
        upon,
        the fulfilment of the following conditions precedent within 21 days from
        the
        date of this Agreement (subject to extension by agreement of the
        Parties):

       

      
        	
                 

              	
                (a)

              	
                the
                  approval of the investment committee of the Investor;
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                the
                  Investor being satisfied with the results of their investigation
                  or due
                  diligence exercise on the Company; 

              

      

       

      
        	
                 

              	
                (c)

              	
                the
                  signing of a put agreement between the Existing Shareholder and
                  MTDC;
                  

              

      

       

      
        	
                 

              	
                (d)

              	
                the
                  signing of the put option agreement between Alnoor Shivji and MTDC;
                  

              

      

       

      
        	
                 

              	
                (e)

              	
                increase
                  in the paid up share capital in the Company by the Existing Shareholder
                  to
                  at least RM300,000 in cash or otherwise, in accordance with Clause
                  3.2.1;
                  and 

              

      

       

      
        	
                 

              	
                (f)

              	
                there
                  being no material adverse change in the operations or financial
                  conditions
                  of the Company or the Existing Shareholder prior to Initial Closing.
                  

              

      

       

       

      2.2           
        Waiver

       

      
        	
                 

              	
                To
                  the extent permitted by law, the Parties reserve the right to agree
                  in
                  writing to mutually waive the fulfilment of any conditions precedent
                  in
                  Clause 2.1. 

              

      

       

       

      2.3           
        Non-fulfillment

       

      Unless
        specifically waived under Clause 2.2, if any conditions precedent is not
        fulfilled within 21 days after the date of this Agreement (or such later
        date as
        the Parties may mutually agree on):

       

      
        	
                 

              	
                (a)

              	
                this
                  Agreement shall automatically cease and terminate;
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                all
                  obligations and liabilities of the parties under this Agreement
                  shall
                  cease to have effect; and 

              

      

       

      
        	
                 

              	
                (c)

              	
                none
                  of the parties shall have any claim against any other party in
                  relation to
                  this Agreement, 

              

      

       

      but
        notwithstanding anything to the contrary in this Clause, a party shall be
        liable
        for any antecedent breach of this Agreement.

       

      
        
          
             
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      3.           
        Share Capital

       

       

      3.1           
        Subscription for Preference Shares

       

      
        	
                 

              	
                3.1.1

              	
                Subject
                  to the terms and conditions of this Agreement, the Investor shall
                  subscribe in cash up to a maximum of 888,888 RCPS, allocated across
                  several tranches as follows: 

              

      

       

      
        	
                 

              	
                (a)

              	
                at
                  Initial Closing, MTDC will subscribe for Tranche A Shares, and
                  the Company
                  will allot and issue Tranche A Shares to MTDC, free from any Encumbrance;
                  and 

              

      

       

      
        	
                 

              	
                (b)

              	
                upon
                  fulfilment of the following milestones:

              

      

       

      
        	
                 

              	
                (i)

              	
                delivery
                  of the Smartchip Alpha System to the University of Pittsburgh;
                  and
                  

              

      

       

      
        	
                 

              	
                (ii)

              	
                the
                  publication of the results from the University of Pittsburgh,
                  

              

      

       

      
        	
                 

              	
                (“Subsequent
                  Closing”),
                  the Investor will subscribe for Tranche B Shares, and the Company
                  will
                  allot and issue Tranche B Shares to the Investor, free from any
                  Encumbrance. 

              

      

       

      
        	
                 

              	
                3.1.2

              	
                The
                  Investor shall subscribe for the amount of shares and consideration
                  as
                  follows: 

              

      

       

      
        	
                Name
                  of Investor

                
                

              	
                Tranche
                  A

                
                

              	
                Tranche
                  B

                
                

              	
                Total

                
                

              
	 	
                No.
                  of RCPS

                
                

              	
                Consider-ation
                  (USD)

                
                

              	
                No.
                  of RCPS

                
                

              	
                Consider-ation
                  (USD)

                
                

              	
                No.
                  of RCPS

                
                

              	
                Consider-ation
                  (USD)

                
                

              
	
                MTDC

                
                

              	
                444,444

                
                

              	
                1,000,000

                
                

              	
                444,444

                
                

              	
                1,000,000

                
                

              	
                888,888

                
                

              	
                2,000,000

                
                

              

      

      

       

      The
        principal terms of the RCPS are set out in Schedule 1.

       

      
        	
                 

              	
                3.1.3

              	
                In
                  respect of each subscription for RCPS under this Agreement, the
                  Company
                  will issue a Subscription Notice to the Investor. The Subscription
                  Notice
                  will specify the number of RCPS to be subscribed by the Investor
                  under
                  Tranche A at the Initial Closing, and Tranche B at the Subsequent
                  Closing,
                  and the Subscription Price. 

              

      

       

      
        	
                 

              	
                3.1.4

              	
                The
                  Existing Shareholder irrevocably confirms its waiver of all rights
                  of
                  pre-emption whatsoever that it may have in connection with the
                  issue and
                  conversion of the RCPS to the Investor pursuant to the terms of
                  this
                  Agreement. 

              

      

       

      
        	
                 

              	
                3.1.5

              	
                The
                  Company shall endeavour to raise a further USD1.5 million through
                  the
                  issue of RCPS within one year from the Initial Closing. The Investor
                  irrevocably confirms its waiver of all rights of pre-emption whatsoever
                  that it may have in connection with the issue and conversion of
                  such RCPS.
                  

              

      

       

      
        
          
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      3.2           
        Subscription for Shares

       

      
        	
                 

              	
                3.2.1

              	
                Prior
                  to the Initial Closing, and subject to all other conditions precedent
                  in
                  Clause 2.1 being fulfilled, the Company shall increase its issued
                  and
                  paid-up share capital from RM2 to RM300,000 by way of allotment
                  and issue
                  of 299,998 Shares and the Existing Shareholder shall subscribe
                  and satisfy
                  the subscription money for such Shares by cash or otherwise. The
                  Investor
                  agrees that the manner of satisfaction of such subscription money
                  may
                  include capitalisation of amounts owing from the Company to the
                  Existing
                  Shareholder, or other consideration otherwise than in cash.
                  

              

      

       

       

      4.           
        Subscription Completion Date

       

      
        	
                4.1

              	
                Subject
                  to fulfilment of all conditions precedent in Clause 2.1, the completion
                  of
                  each allotment and issue of the RCPS to the Investor pursuant to
                  this
                  Agreement shall take place at the registered office of the Company
                  as
                  follows: 

              

      

       

      (a)           
        Tranche A Shares at the Initial Closing; and

       

      (b)           
        Tranche B Shares at the Subsequent Closing;

       

      or
        such
        other date and time as may be mutually agreed by the Parties in
        writing.

       

      
        	
                4.2

              	
                The
                  Investors shall cause or procure a cheque, bank draft or cashier’s order
                  in favour of the Company to be deposited, or a telegraphic or electronic
                  transfer made, to the bank account of the Company held with HSBC
                  Bank
                  Berhad for the total subscription monies payable for the number
                  of RCPS to
                  be subscribed (as set out in the relevant Subscription Notice),
                  in
                  exchange for the delivery by the Company of the following:
                  

              

      

       

      
        	
                 

              	
                (a)

              	
                at
                  the Initial Closing, the share certificates in respect of the RCPS,
                  a
                  certified extract of the shareholders' resolution of the Company
                  approving
                  the subscription of the Tranche A Shares by MTDC at the Initial
                  Closing
                  (including amendment of the Articles of Association of the Company
                  where
                  required), pursuant to the terms and subject to the conditions
                  of this
                  Agreement; 

              

      

       

      
        	
                 

              	
                (b)

              	
                at
                  the Subsequent Closing, the share certificates in respect of the
                  RCPS, a
                  certified extract of the shareholders' resolution of the Company
                  approving
                  the subscription of the Tranche B Shares by MTDC at the Subsequent
                  Closing, pursuant to the terms and subject to the conditions of
                  this
                  Agreement; and 

              

      

       

      
        	
                 

              	
                (c)

              	
                at
                  both the Initial Closing and the Subsequent Closing, a certified
                  extract
                  of the resolution of the Board confirming the allotment and issue
                  of the
                  relevant number of RCPS to be subscribed by MTDC pursuant to the
                  relevant
                  Subscription Notice. 

              

      

       

      
        
          
             | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

       

       

       

      
        	
                5.

              	
                Undertakings,
                  Warranties and Representations by the Parties

              

      

       

      
        	
                5.1

              	
                Subject
                  to any exceptions expressly and specifically disclosed in any
                  correspondence, communication, document or information in writing
                  prior to
                  or after the execution of this Agreement and prior to the completion
                  of
                  the subscription of the RCPS, the Parties warrant to each other
                  that the
                  information and statements set out in the Warranties are true,
                  accurate
                  and correct in all respects at the date of this Agreement. To this
                  effect,
                  the Warranties will be deemed to be repeated during this period
                  as if they
                  had been entered into afresh during the said period in relation
                  to the
                  facts and circumstances then existing.

              

      

       

      
        	
                5.2

              	
                The
                  Parties acknowledge and agree that each of them entered into this
                  Agreement in reliance on the Warranties.

              

      

       

      
        	
                5.3

              	
                Each
                  of the Warranties is separate and is to be construed independently
                  of the
                  others and is not limited by reference to any of the other Warranties.
                  

              

      

       

      Save
        as
        disclosed to the Investors in any correspondence, communication, document
        or
        information in writing prior to or after the execution of this Agreement
        and
        prior to the Completion of this Agreement, no information relating to the
        RCPS
        or the Company will limit the nature of the Warranties given by the Company
        under this Agreement, or will prejudice any claim to be made by the Investors
        against the Company for any breach of the Warranties.

       

      Each
        of
        the Party will indemnify and will keep the other Parties indemnified against
        all
        losses, damages, costs and expenses which the other Parties may incur or
        be
        liable for in respect of any claim, demand, liability, action, proceedings
        or
        suits arising out of or in connection with :

       

      
        	
                 

              	
                (a)

              	
                a
                  breach of a Warranty; 

              

      

       

      
        	
                 

              	
                (b)

              	
                any
                  Warranty not being true and correct in all respects; or
                  

              

      

       

      
        	
                 

              	
                (c)

              	
                any
                  Warranty being misleading in any respect,

              

      

       

      save
        and
        except where any of the matters set out in paragraphs 5.1 to 5.3 above shall
        have been apparent in any correspondence, communication, document or information
        in writing and  disclosed or provided to the Investors prior to or
        after the execution of this Agreement and prior to the Completion of this
        Agreement.

       

       

      6.           
        Management of the Company

       

       

      6.1           
        Board of Directors

       

      
        	
                 

              	
                The
                  Board shall comprise 6 directors of which:

              

      

       

      
        	
                 

              	
                (a)

              	
                MTDC
                  shall have the right to appoint one (1) director (“Series ADirector”)
                  and MTDC
                  shall procure that (if relevant), the Series A Director shall,
                  prior to
                  his appointment as a director of the Company, provide a confidentiality
                  and non-competition undertaking to the Company; and
                  

              

      

       

      
        
          
             | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      
        	
                 

              	
                (b)

              	
                the
                  Existing Shareholder shall have the right to appoint five (5) directors
                  and such right shall include the appointment of the Chief Executive
                  Officer. 

              

      

       

      MTDC
        shall have the right to nominate an alternate to the Series A Director and
        the
        Existing Shareholder shall have the right to nominate an alternate director
        to
        such directors appointed under paragraph 6.1(b).

       

      MTDC
        and
        the Existing Shareholder will jointly appoint an independent director to
        the
        Board with the requirement that the independent director has relevant
        international industry experience in the Business.

       

      
        	
                 

              	
                The
                  right of appointment of the Series A Director shall include the
                  right for
                  MTDC to remove such person at any time from such office and also
                  the right
                  to determine from time to time the period which such person shall
                  hold
                  office as the Series A Director. Upon MTDC ceasing to be a shareholder
                  in
                  the Company, MTDC shall simultaneously procure the resignation
                  of the
                  Series A Director. The Series A Director may not be removed by
                  the
                  Existing Shareholder or any other party except when MTDC ceases
                  to be a
                  shareholder in the Company. Any appointment or removal of the Series
                  A
                  Director by MTDC shall be made in writing and shall be delivered
                  to the
                  registered office of the Company. 

              

      

       

       

      6.2           
        Board Meetings

       

      The
        quorum at all meetings shall be at least three (3) Directors and must include
        the Series A Director (or his alternate). If a quorum is not
        present within 45 minutes after the time appointed for the commencement of
        a
        meeting of the Board, that meeting shall be adjourned to the same time 7
        days
        after that meeting at the same place provided that at such adjourned meeting
        (for the same agenda), the quorum shall be any two (2) Directors.

       

      The
        Directors may meet together either in person or by telephone, radio, video
        conference or similar communication equipment or any other form of audio
        or
        audio-visual instantaneous communication by which all persons participating
        in
        the meeting are able to hear and be heard by all other participants and
        participation in a meeting pursuant to this provision shall constitute presence
        in person at such meeting.

       

      The
        Company’s Articles shall be amended to provide that a quorum of the Board must
        include at least one Series A Director, except at any adjourned
        meeting.

       

       

      6.3           
        Provisions in respect of meetings

       

      Any
        Director may at any time request for a meeting to be convened, subject to
        the
        Board meeting at least once quarterly unless otherwise agreed to by a vote
        of a
        majority of Directors including at least one vote from a Series A Director.
        The
        request for a meeting must be made in writing and delivered to the company
        secretary of the Company.

       

      Upon
        receiving the request, the company secretary is to issue a notice, giving
        at
        least 7 days’ prior written notice to all Directors and their alternates. The
        notice shall set out the date, time, venue and the agenda or matters to be
        discussed for the Board meeting.  Such notice shall not be required if
        all Directors are present or

       

      
        
          
             
              

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      represented
        at the meeting or if the absent Directors agree in writing to waive the
        requirement of such notice.

       

       

      
        	
                6.4  

              	
                Resolutions

              

      

       

      So
        long
        as a quorum is present throughout the meeting of the Board in accordance
        with
        clause 6.2, all resolutions or decisions of the Board are to be by a simple
        majority of all the Directors present and capable of voting at the meeting
        of
        the Board.

       

       

      6.5           
        Circular resolution

       

      A
        written resolution or minute of a
        decision made by the Board which is signed by all the Directors is regarded
        as
        valid and effectual as if it had been passed at a duly convened Board meeting.
        Any such written resolution or minute may consist of several documents (or
        facsimiles thereof) in like form or in one or more counterparts, each signed
        by
        one or more of the Directors, and all counterparts taken together constitute
        one
        document.

       

       

      6.6           
        No shareholding requirement

       

      The
        Directors need not be shareholders of the Company and are not liable to retire
        by rotation until removed/replaced by the Party nominating them.

       

       

      6.7           
        Management

       

      The
        operations of the Company will be managed by the Board, but the day to day
        administration or management of the Company may be vested in a management
        committee (“Management
        Committee”) appointed by the Board from time to time who shall at all
        times be responsible and subject to the control of the Board. The Management
        Committee may comprise members of the Board.

       

       

      6.8           
        Nominees

       

      The
        parties acknowledge that as the Series A Director is a nominee of MTDC, the
        Series A Director shall be entitled to report all matters concerning the
        Company, including but not limited to matters discussed at any meeting of
        the
        Board, to MTDC and its shareholders and that the Series A Director may take
        advice and obtain instructions MTDC.

       

      The
        Company agrees to indemnify and keep the Series A Director
        indemnified,  subject to section 140 of the Act..

       

       

      7.           
        General meetings

       

       

      7.1           
        General meetings

       

      Annual
        general meetings and
        extraordinary general meetings of the Shareholders are to be held in accordance
        with the provisions of the Act.

       

       

      7.2           
        Quorum

       

      The
        quorum for all general meetings of the Shareholders is two (2) persons being
        present throughout the meeting, consisting of the Shareholders or their
        respective proxy, attorney or authorised representative.

       

      
        
          
             
              | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

       

      7.3           
        Decisions at meetings of the Shareholders

       

       

      
        	
                7.3.1

              	
                Ordinary
                  Resolution 

              

      

       

      So
        long as a quorum is present
        throughout the meeting of the Shareholders in accordance with clause 7.2,
        subject to clause 7.4, a simple majority vote of those present and voting
        suffices to pass an ordinary resolution.

       

       

      
        	
                7.3.2

              	
                Special
                  Resolution 

              

      

       

      The
        approval of Shareholders by way of
        special resolution (as defined in the Act) is required for matters which
        require
        a special resolution to be passed as specified in the Act.

       

       

      7.4           
        Shareholder Reserve Matters

       

      The
        resolutions in relation to the following matters require approval from all
        Shareholders present and voting at a general meeting or by circular resolution
        (signed by all the Shareholders):

       

      
        	
                 

              	
                (a)

              	
                any
                  amendment to the Memorandum and Articles of Association of the
                  Company;
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                the
                  appointment or removal of any Director or senior management of
                  the
                  Company; and 

              

      

       

      
        	
                 

              	
                (c)

              	
                the
                  declaration of dividends by the Company.

              

      

       

       

      8.           
        Business of the Company

       

      
        	
                8.1

              	
                The
                  core business of the Company, unless otherwise agreed in writing
                  by the
                  Investors, shall be developing, manufacturing, and distributing
                  state of
                  the art solutions for Gene Analysis (Gene Expression, and Genotyping)
                  and
                  stem cell research and cell biology (“Business”).  The
                  Company will not engage in any other business which detracts from,
                  or is
                  not complementary to, the Business.

              

      

       

      
        	
                8.2

              	
                The
                  Business is to be carried out in accordance with all applicable
                  laws and
                  requirements. 

              

      

       

      
        	
                8.3

              	
                The
                  Shareholders shall use its reasonable endeavours without being
                  required to
                  incur any further financial obligation (other than as expressly
                  set out in
                  this Agreement) to promote the interests of the Company. The Business
                  is
                  to be conducted in the Shareholders’ and the Company’s best interests on
                  sound commercial profit-making principles so as to generate the
                  maximum
                  achievable maintainable profits available for distribution, and
                  otherwise
                  in accordance with the general principles as varied from time to
                  time by
                  agreement in writing between the Parties.

              

      

       

      
        	
                8.4

              	
                The
                  Company shall not, and the Existing Shareholder shall ensure that
                  the
                  Company shall not, without the prior written consent of the Investors
                  or
                  as expressly stated in this Agreement :

              

      

       

      
        
          
               

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      
        	
                 

              	
                (a)

              	
                cease
                  to conduct or carry on its Business substantially as now conducted
                  and/or
                  acquire or dispose of or dilute any interest in any other business,
                  company, partnership or sole proprietorship; and
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                purchase,
                  sell, mortgage or charge any substantial asset, or property or
                  any
                  material interest in those assets or property or sell or dispose
                  of the
                  whole or a substantial part of the undertaking and goodwill or
                  the assets
                  of the Company. 

              

      

       

      8.5           
        The Existing Shareholder and/or the Company shall ensure that :

       

      
        	
                 

              	
                (a)

              	
                the
                  Company shall at all times carry on and conduct its business in
                  a proper
                  and efficient manner; 

              

      

       

      
        	
                 

              	
                (b)

              	
                each
                  employee and consultant of the Company enters into a confidential
                  information and inventions agreement (in a form acceptable to the
                  Investor) with the Company; 

              

      

       

      
        	
                 

              	
                (c)

              	
                the
                  Company shall submit to the Investor without being formally requested:
                  

              

      

       

      
        	
                 

              	
                (i)

              	
                an
                  annual budget and operating plan no later than sixty (60) days
                  prior to
                  the commencement of each fiscal year;

              

      

       

      
        	
                 

              	
                (ii)

              	
                an
                  annual business plan; 

              

      

       

      
        	
                (iii)  

              	
                audited
                  financial statements on an interim and annual basis;
                  and

              

      

       

      
        	
                (iv)  

              	
                monthly
                  reports, including financial reports, bank statements and technical
                  reports.

              

      

       

      The
        obligation of the Company to furnish the information set out in paragraph
        8.5(c)
        will cease when the Company completes its IPO or becomes subject to the
        reporting provisions of any applicable stock exchange requirements or MTDC
        ceasing to be a shareholder in the Company.

       

      
        	
                 

              	
                (d)

              	
                at
                  all times keep true accurate and up to date books and records of
                  all the
                  affairs of the Company; 

              

      

       

      
        	
                 

              	
                (e)

              	
                supply
                  to the Investor such information relating to the Company as it
                  may require
                  and without prejudice to the foregoing shall keep the Investor
                  fully and
                  promptly informed as to all material developments regarding the
                  Company’s
                  financial and business affairs and promptly notify the Investor
                  of any
                  significant litigation or arbitration affecting or likely to affect
                  the
                  Company and of any bona fide offer to purchase or subscribe any
                  share
                  capital of the Company; 

              

      

       

      
        	
                 

              	
                (f)

              	
                at
                  all times be adequately insured in respect of the assets of the
                  company
                  which are of an insurable nature and obtain life insurance for
                  the core
                  management team of the Company, the proceeds of which are payable
                  to the
                  Company; and 

              

      

       

      
        	
                 

              	
                (g)

              	
                upon
                  the Company’s receipt of reasonable notice, the Investor may have access
                  during normal business hours to relevant non-confidential information
                  and/or non-competitive information requested by the Investor
                  

              

      

       

      
        
          
          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      
        	
                 

              	
                including
                  the right to visit the Company’s business premises and inspect the
                  Company’s record books. 

              

      

       

       

      9           
        New Issues of Shares

       

       

      9.1           
        New Issues by Company

       

      The
        Shareholders agree that any new Shares and/or RCPS issued by the Company
        must be
        with the prior approval of the Shareholders (“Offered Shares”) and the
        Offered Shares shall be first offered to each of the Shareholders in proportion
        to each of their shareholding in the Company at the time of the proposed
        new
        issue other than:

       

      
        	
                (i)  

              	
                for
                  the initial share capital as provided for in Clauses 3.1 and
                  3.2;

              

      

       

      
        	
                (ii)  

              	
                the
                  issuance of Shares and/or RCPS referred to in Clause
                  3.1.5;

              

      

       

      
        	
                (iii)  

              	
                the
                  Conversion Shares, where
                  applicable;

              

      

       

      
        	
                (iv)  

              	
                Shares
                  issued pursuant to employee share option plans approved by a majority
                  of
                  the Board;

              

      

       

      
        	
                (v)  

              	
                Shares
                  issued for merger or acquisition transactions;
                  or

              

      

       

      
        	
                (vi)  

              	
                any
                  issuance excepted from the right of first refusal by a majority
                  of the
                  Board.

              

      

       

       

      9.2           
        Offer to Shareholders

       

      An
        offer
        of the Offered Shares shall be made by notice specifying the number of new
        Shares and/or RCPS offered, the subscription price and limiting a period
        (not
        being less than 30 days) within which the offer, if not accepted, will be
        deemed
        to be declined. Upon the expiration of such period the Board shall offer
        the
        Offered Shares so declined to the other Shareholders who have notified their
        willingness to take all or any of such Shares in accordance with the terms
        of
        the offer and in case of competition, pro rata (as nearly as possible) according
        to the number of Shares and RCPS held by the other Shareholders.

       

       

      10.           
        Transfers, Acquisitions and Disposal of Shares

       

       

      10.1           
        Pre-emption Rights

       

      
        	
                10.1.1

              	
                The
                  rights of the Shareholders to sell, transfer, assign, pledge, charge,
                  encumber or otherwise dispose of their shareholding in the Company
                  (or any
                  part thereof) shall be subject to the restrictions and provisions
                  set out
                  below : 

              

      

      

      
        	
                (a)  

              	
                In
                  the event any Shareholder desires to dispose of all or any portion
                  of
                  their shareholding in the Company pursuant to a bona-fide third
                  party
                  offer for the shares (“Transferor”), the
                  Transferor shall first afford the other Shareholders (“the Transferees”) a
                  right of first refusal with regard to those shares (“the Relevant
                  Shares”) in
                  proportion to such Transferee’s shareholding in the Company. In this
                  regard, the Transferor shall give the Transferees written notice
                  (hereinafter called a “Transfer Notice”) of
                  the

              

      

       

      
        
          
             

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      
        	
                (b)  

              	
                Transferor’s
                  intention to dispose of the Relevant Shares, which notice shall
                  include
                  the proposed transferee, the number of shares to be transferred,
                  the price
                  per share, and the terms of
                  payment.

              

      

       

      
        	
                (c)  

              	
                Upon
                  receipt of the Transfer Notice, the Transferees shall have the
                  option, but
                  not the obligation, to purchase the Relevant Shares at either (i)
                  the same
                  terms and conditions price for the Relevant Shares as set forth
                  in the
                  Transfer Notice, or (ii) to request that the Shareholders appoint
                  an
                  independent firm (at the cost and expense of the Transferor) to
                  determine
                  the sale price per Relevant Share in accordance with the shareholders
                  funds or the net tangible assets (whichever is lower) of the Company
                  as at
                  the date of the Transfer Notice (“the Prescribed
                  Price”).

              

      

       

      
        	
                (d)  

              	
                In
                  the event the Transferees determine to accept the terms contained
                  in the
                  Transfer Notice or upon the determination of and purchase of the
                  Relevant
                  Shares at the Prescribed Price, the Relevant Shares shall promptly
                  be
                  offered by the Transferor by notice in writing to the Transferees
                  (and if
                  there is more than one Transferee, to each Transferee in proportion
                  to
                  such Transferee’s shareholding in the Company) for purchase. Such offer
                  shall be open for acceptance at any time within the Prescribed
                  Period. The
                  Prescribed Period shall commence on the date that
                  :

              

      

       

      
        	
                (i)  

              	
                the
                  Transferees notify the Transferor of their acceptance of the offer
                  to
                  purchase the Relevant Shares on the terms contained in the Transfer
                  Notice; or

              

      

       

      
        	
                (ii)  

              	
                the
                  Prescribed Price is determined;

              

      

       

      and
        will
        expire sixty (60) days thereafter, after either (i) or (ii) as applicable.
        The
        Transferee(s) so accepting the offer shall hereinafter be called the
“Purchaser(s)”.

       

      
        	
                (e)  

              	
                If
                  there is more than one Purchaser, each Purchaser shall have the
                  right to
                  purchase the Relevant Shares pro rata in accordance with the ratio
                  that
                  his shareholding bears to the aggregate shareholdings of all the
                  Purchasers provided that the said Purchaser must purchase all the
                  Relevant
                  Shares offered to him. Upon acceptance of such offer by the Purchasers
                  within the Prescribed Period, the Transferor shall be bound to
                  sell the
                  Relevant Shares to the Purchasers as set forth above. The sale
                  and
                  purchase of the Relevant Shares shall be completed in accordance
                  with the
                  provisions herein.

              

      

       

      
        	
                (f)  

              	
                If
                  the offer of the Relevant Shares shall not be accepted by the Transferees,
                  then the Transferor shall be at liberty to transfer or dispose
                  of the
                  Relevant Shares within a period of three (3) months from the expiry
                  of the
                  Prescribed Period to the person identified in the Transfer Notice
                  and in
                  accordance with the terms thereof, subject to Clause 10.1.2
                  below.

              

      

       

      
        	
                (g)  

              	
                Any
                  transfer, disposal or sale of shares contemplated by this Clause
                  10.1.1
                  shall be subject to the approval(s) of the Public Authorities should
                  such
                  approval be required in law or in practice. Completion and payment
                  of the
                  Prescribed Price shall take place not less than three (3) days
                  nor more
                  than ten (10) Business Days after the date of the receipt of such
                  approval(s) of the Public
                  Authorities.

              

      

       

      
        
          
               

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      
        	
                (h)  

              	 

      

       

      
        	
                (i)  

              	
                Any
                  transfer, disposal or sale of shares contemplated by Clause 10.1(e)
                  to a
                  third party purchaser shall be further subject to such third party
                  purchaser entering into a deed or other suitable documentation
                  agreeing to
                  be bound by all the terms of this
                  Agreement.

              

      

       

      
        	
                (j)  

              	
                The
                  procedures and pre-emption rights under this Clause 10 may be waived
                  in
                  writing by the Shareholders.

              

      

       

      
        	
                10.1.2

              	
                Pursuant
                  to Clause 10.1.1(e), if the Existing Shareholder wishes to sell
                  its shares
                  to a third party, the Existing Shareholder shall ensure that the
                  Investor
                  be entitled (but not obliged) to sell any part of its holding of
                  Shares to
                  the third party on no less favourable terms and conditions as are
                  applicable to the Existing Shareholder. Upon any exercise by the
                  Investor
                  of this entitlement within 30 days from the date of notice by the
                  Existing
                  Shareholder of such entitlement of the Investor, the Existing Shareholder
                  shall not transfer or sell any of its shares to the third party
                  unless the
                  relevant shares of Investor are so purchased by the third party.
                  

              

      

       

      
        	
                10.1.3

              	
                All
                  third parties who acquire shares in the Company under this Clause
                  10.1
                  shall enter into a deed of ratification and accession under which
                  the
                  third party shall agree to be bound by the obligations, and shall
                  be
                  entitled to the benefit, of this Agreement.

              

      

       

       

      11           
        Put Options

       

       

      11.1           
        Investor’s Put Right for shares in the Existing Shareholder

       

      As
        a
        conditions precedent, the Existing Shareholder will grant to MTDC an option
        to
        sell all the RCPS held by MTDC to the Existing Shareholder upon the terms
        and
        conditions of the Put Agreement to be entered into between the Existing
        Shareholder and MTDC.

       

       

      11.2           
        Investor’s Put Option for Conversion Shares

       

      
        	
                 

              	
                The
                  Investor shall have the option to require the Existing Shareholder
                  to
                  purchase all (but not less than all) of the Conversion Shares held
                  by the
                  Investor, upon thirty (30) days’ notice in writing to the Existing
                  Shareholder. The price payable shall be  calculated based on the
                  price of USD225 for each Conversion Share, such price compounded
                  at the
                  rate of 6% per annum with yearly rests, up to the date of exercise
                  of the
                  option, and at the discretion of the Existing Shareholder, may
                  be
                  satisfied by either cash or the issuance of shares in the Existing
                  Shareholder. The option shall be exercisable any time between 1
                  January
                  2011 and 31 December 2011 and subject to the following:
                  

              

      

       

      
        	
                 

              	
                (a)

              	
                the
                  share price of the Existing Shareholder’s shares is below USD2.25; or
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                due
                  to any reasons attributable to the Existing Shareholder, the Investor
                  is
                  unable to exercise its rights under the Put Agreement.
                  

              

      

       

      
        
          
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      12.           
        Duration and Termination

       

      Subject
        to the provisions of this Clause 12 and Clause 2.4, this Agreement shall
        take
        effect without limit in point of time.  If the Investor or the
        Existing Shareholder sells or transfers all of its shares in the Company
        or if
        the Investor redeems or exchanges all the RCPS to the shares in the Existing
        Shareholder, in accordance with the provisions of this Agreement or the Articles
        (to the extent not inconsistent with this Agreement) or the Put Agreement
        respectively, it shall be released from all of its rights and obligations
        under
        this Agreement and cease to be a party to this Agreement, and all obligations
        of
        that Party and all entitlements and requirements relating to that Party under
        this Agreement will cease.  If following any such sale, transfer,
        redemption or exchange, two or more parties continue to be bound by this
        Agreement, this Agreement shall continue in full force and effect as between
        those parties.

       

       

      13.           
        Previous Agreements and Prevalence of Agreement

       

      
        	
                13.1

              	
                This
                  Agreement and the documents referred to in its provisions are in
                  substitution for all previous agreements between all or any of
                  the parties
                  and contain the whole agreement between the parties relating to
                  the
                  subject matter of this Agreement. 

              

      

       

      
        	
                13.2

              	
                If,
                  during the continuance of this Agreement, there is any conflict
                  between
                  this Agreement and the Articles, the provisions of this Agreement
                  shall
                  prevail between the parties. In the event of such conflict arising,
                  the
                  parties shall procure and take all necessary steps including effecting
                  such alteration to the Articles as may be necessary to resolve
                  such
                  conflict. 

              

      

       

       

      14.           
        Remedy on an Event of Default

       

      
        	
                14.1

              	
                Each
                  of the following will be regarded as an Event of Default:
                  

              

      

       

      
        	
                 

              	
                (a)

              	
                either
                  of the Shareholders committing a breach of its obligations under
                  this
                  Agreement and, in the case of a breach capable of remedy, failing
                  to
                  remedy the same within twenty one (21) days of being specifically
                  required
                  in writing so to do by the other Shareholder; or
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                any
                  distress, execution, sequestration or other process being levied
                  or
                  enforced upon or sued out against the property of any of the Shareholders
                  which is not discharged within ten (10) days; or
                  

              

      

       

      
        	
                 

              	
                (c)

              	
                any
                  encumbrancer taking possession of or a receiver or trustee being
                  appointed
                  over the whole or any part of the undertaking, property or assets
                  of any
                  of the Shareholders; or 

              

      

       

      
        	
                 

              	
                (d)

              	
                the
                  making of an order or the passing of a resolution for the winding
                  up of
                  any of the Shareholders, otherwise than for the purpose of a
                  reconstruction or amalgamation without insolvency or previously
                  approved
                  by the other Shareholder (such approval not to be unreasonably
                  withheld).
                  

              

      

       

      
        
          
               

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      
        	
                14.2

              	
                In
                  the event of an Event of Default taking place,

              

      

       

      
        	
                 

              	
                (a)

              	
                the
                  non-defaulting Shareholder shall be entitled to terminate this
                  Agreement;
                  or 

              

      

       

      
        	
                 

              	
                (b)

              	
                the
                  deadlock provisions referred to in clause 16 shall apply,
                  

              

      

       

      
        	
                 

              	
                without
                  prejudice to any rights or remedies the non-defaulting Shareholder
                  may
                  have against the defaulting Shareholder for any antecedent breach.
                  

              

      

       

      
        	
                14.3

              	
                Notwithstanding
                  any provision in this Agreement to the contrary, this Agreement
                  shall
                  remain in full force and effect for so long as shall be necessary
                  to
                  fulfil and give effect to the arrangements and undertakings contained
                  in
                  this Agreement. 

              

      

       

      
        	
                14.4

              	
                Termination
                  of this Agreement for any cause in accordance with the provisions
                  of this
                  Agreement shall not release any Shareholder from any liability
                  which at
                  the time of termination has already accrued to the other or which
                  thereafter may accrue in respect of any act or omission prior to
                  such
                  termination or which has accrued in consequence of this clause.
                  

              

      

       

       

      15.           
        Confidentiality

       

      Parties
        shall :

       

      
        	
                 

              	
                (a)

              	
                ensure
                  the confidentiality of this Agreement and the transactions contemplated
                  in
                  this Agreement; 

              

      

       

      (b)           
        not disclose any provision of this Agreement except :

       

      
        	
                 

              	
                (i)

              	
                where
                  required by law or any relevant governmental regulatory body or
                  competent
                  authority; 

              

      

       

      (ii)           
        to any financier or professional adviser acting for the party; or

       

      
        	
                 

              	
                (iii)

              	
                the
                  information is public knowledge otherwise than as a consequence
                  of breach
                  of this Clause. 

              

      

       

      
        	
                 

              	
                 The
                  Existing Shareholder and the Company are permitted to disclose
                  the names
                  of the Parties or make reference to the Parties contributions to
                  the
                  Company. For purposes deemed necessary for the furtherance of the
                  Business, the confidentiality obligation in this Agreement does
                  not cover
                  the names of the Parties and their respective interests in the
                  Company.
                  

              

      

       

      
        	
                 

              	
                This
                  restriction continues to apply after the expiration or sooner termination
                  of this Agreement without limit in point of time but ceases to
                  apply to
                  information or knowledge which may properly come into the public
                  domain
                  through no fault of the Party so restricted.

              

      

       

      
        
          
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      16.           
        Deadlock

       

       

      16.1           
        Disputes

       

      
        	
                 

              	
                If
                  the Shareholders or their respective representatives are unable
                  to reach
                  agreement in relation to any reserved matter provided for in Clause
                  7.4 or
                  there is an Event of Default pursuant to Clause 14 or otherwise
                  in
                  relation to any matter of material importance to the future conduct
                  of the
                  Business, the matter shall be referred in the first instance to
                  Alnoor
                  Shivji on behalf of the Existing Shareholder and to the Chief Executive
                  Officer of MTDC on behalf of the MTDC for resolution. Alnoor Shivji
                  and
                  the Chief Executive Officer of MTDC shall endeavour to resolve
                  any
                  disagreement in the best interest of the Company as a whole.
                  

              

      

       

       

      16.2           
        Artificial Deadlock

       

      
        	
                 

              	
                In
                  no circumstances shall any of the Shareholders create an artificial
                  deadlock for the purposes of this Clause 16. An artificial deadlock
                  shall
                  be a deadlock caused by any Shareholder voting against an issue
                  or
                  proposal in circumstances where the approval of the same is required
                  to
                  enable the Company to carry on the Business properly and efficiently.
                  

              

      

       

       

      17.           
        Further Assurance

       

      Each
        party shall execute and do all such documents and things as are necessary
        to
        carry this Agreement into effect or to give full effect to this
        Agreement.

       

      

      18.           
        Remedies

      If
        a
        Party does not comply with its obligations under this Agreement, the other
        Party
        is entitled to the remedy of specific performance and injunctive relief (as
        may
        be applicable), and monetary compensation by itself is not an adequate
        remedy.

       

      

      19.           
        Waiver and Variation

       

      19.1           
        Rights not affected

       

      The
        rights which each Party has under this Agreement shall not be prejudiced
        or
        restricted by any delay in exercising or failure to exercise any right or
        remedy
        under this Agreement.  Unless otherwise agreed in writing, no waiver
        by any party in respect of a breach shall operate as a waiver in respect
        of any
        subsequent breach.

       

       

      19.2           
        Cumulative rights and remedies

       

      The
        rights and remedies provided in this Agreement are in addition to, and do
        not
        exclude or limit, any rights or remedies provided by law.

       

       

      19.3           
        Variation

       

      This
        Agreement shall not be varied unless the variation is expressly agreed in
        writing by each Party.

       

      
        
          
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      20.           
        Severability

       

      If
        any
        provision of this Agreement is void or unenforceable, it shall be regarded
        as
        deleted from this Agreement, and the remaining provisions shall continue
        to
        apply.

       

       

      21.           
        Continuing Effect

       

      Notwithstanding
        the completion of the transaction contemplated in this Agreement, the provisions
        of this Agreement shall continue to survive or subsist so long as may be
        necessary for the purpose of giving effect to each of them.

       

       

      22.           
        Time

       

      Time
        wherever mentioned in this Agreement shall be of the essence of this
        Agreement.

       

       

      23.           
        Legal Relationship

       

      Nothing
        in this Agreement shall create, or be regarded as creating, a partnership
        or the
        relationship of employer and employee between the Parties. Neither Party
        has any
        authority to bind the other in any way.

       

       

      24.           
        Costs and Expenses

       

      The
        Existing Shareholder and/or the
        Company shall bear all fees, costs and expenses of the Investor’s solicitors in
        connection with this Agreement which shall not exceed RM10,000.

       

       

      25.           
        Assignment; Successors

       

       

      25.1           
        Assignment

       

      Parties
        may not assign or otherwise deal with its respective rights or benefits under
        this Agreement without the prior written consent of the other
        Parties.

       

       

      25.2           
        Successors and assigns

       

      This
        Agreement shall be binding upon the parties and their respective successors,
        permitted assigns and personal representatives.

       

       

      26.           
        Notices

       

      
        	
              	
                Without
                  affecting any other effective mode of service, any notice given
                  under this
                  Agreement : 

              

      

       

      
        
          
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                (a)

              	
                must
                  be in writing and may be delivered personally or sent by registered
                  post
                  to the intended recipient at the address shown below or the address
                  last
                  notified by the intended recipient to the sender :
                  

              

      

       

      For
        the
        Investor :

       

      

       

      MTDC

       

      Level
        8-9, Menara Yayasan Tun Razak,

       

      Jalan
        Bukit Bintang,

       

      55100
        Kuala Lumpur

       

      Attn:
        Dato’ Azlin b. Alias

       

      Tel:
        03-2163 7571

       

      Fax:
        03-2163 7570

       

      

       

      For
        the
        Existing Shareholder:

       

      Wafergen
        Bio-Systems Inc

       

      Bayside
        Technology Center,

       

      46531
        Fremont Blvd,

       

      Fremont,
        CA 94538, USA

       

      Attn
        :
        Alnoor Shivji

       

      Tel
        : +1
        (510) 468-0546

       

      Fax
        : +1
        (510) 651-4599

       

      

       

      For
        the
        Company:

       

      Wafergen
        Biosystems (M) Sdn
        Bhd (formerly known as Global Dupleks Sdn Bhd)

       

      c/o
        Wafergen Bio-Systems Inc

       

      Bayside
        Technology Center,

       

      46531
        Fremont Blvd,

       

      Fremont,
        CA 94538, USA

       

      Attn
        :
        Alnoor Shivji

       

      Tel
        : +1
        (510) 468-0546

       

      Fax
        : +1
        (510) 651-4599

       

      
        	
                 

              	
                (b)

              	
                must
                  be signed; and 

              

      

       

      
        	
                 

              	
                (c)

              	
                will
                  be taken to be duly given or made :

              

      

       

      
        
          
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                (i)

              	
                (in
                  the case of delivery in person) when delivered, received or left
                  at the
                  above address; and 

              

      

       

      
        	
                 

              	
                (ii)

              	
                (in
                  the case of delivery by registered post) 48 hours after posting,
                  and in
                  proving service it shall only be necessary to prove that the communication
                  was contained in an envelop which was duly addressed and posted
                  in
                  accordance with this Clause, 

              

      

       

      
        	
                 

              	
                but
                  if delivery, receipt or service occurs, or will be taken to occur,
                  on a
                  day on which business is not generally carried on in the place
                  to which
                  the communication is sent or is later than 4 p.m. (local time)
                  it will be
                  taken to have been duly given or made at the commencement of business
                  on
                  the next day on which business is generally carried on in the place.
                  

              

      

       

       

      27.           
        Entire agreement

       

      This
        Agreement is the entire agreement between the Parties in respect of its subject
        matter and supersedes all previous agreements with respect to its subject
        matter.

       

       

      28.           
        Counterparts

       

      This
        Agreement may be executed in any number of counterparts, and all counterparts
        taken together constitute one and the same instrument.

       

       

      29.           
        Governing Law and Jurisdiction

       

      This
        Agreement is governed by the laws of Malaysia, and each party submits to
        the
        non-exclusive jurisdiction of the courts exercising jurisdiction in
        Malaysia.

       

      

      
        
          
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      SCHEDULE
        1

       

      

      Principal
        Terms of the
        RCPS

      

       

      1.           
        Subscription Price and par value

       

      The
        subscription price for each RCPS shall be Ringgit Malaysia equivalent to
        USD2.25
        calculated at the prevailing exchange rate on the on the date payment of
        the
        Subscription Price is effected .  Each RCPS shall have a par value of
        RM0.01.

       

       

      2.           
        Premium

       

      Each
        RCPS
        shall be issued at a premium being the difference between the Subscription
        Price
        and the par value of RM0.01.

       

       

      3.           
        Dividend Provision

       

      

      There
        is
        no specific dividend rate attached to the RCPS and the Company is not obliged
        to
        declare and pay any dividend while the Investor is holding the
        RCPS.

       

       

      4.           
        Liquidation Preference

       

      

      In
        the
        event of any liquidation, dissolution or winding up of the Company, the holders
        of the RCPS will be entitled to receive in preference to the holders of Shares,
        the relevant Subscription Price paid for the RCPS plus all accrued but unpaid
        dividends and dividends in arrears, if any.

       

       

      5.           
        Conversion

       

      Each
        holder of the RCPS will have the right, at the option of the holder at any
        time,
        to convert all or part of the RCPS into such number of Shares at a conversion
        ratio of one hundred-to-one (100 RCPS : 1 Share).

       

      The
        conversion is to be effected by way of consolidating the par value of every
        one
        hundred RCPS of RM0.01 each, into the total par value of RM1.00 of each
        Share.

       

      To
        effect
        the above conversion, a conversion notice shall be sent by the holder(s)
        of the
        RCPS to the Company not less than thirty (30) days before the intended date
        of
        conversion.  Such notice shall be in writing and shall fix the date
        and the time for the conversion.

       

      The
        Company may from time to time consult with, and make proposals to, the holder(s)
        of RCPS in relation to the exercise of the holder(s)’ entitlement to convert the
        RCPS.

       

      Completion
        of the conversion of the RCPS into Conversion Shares shall be effected at
        the
        registered office of the Company unless agreed otherwise by the holder(s)
        of the
        RCPS and the Company.  On the date fixed for conversion, the holder(s)
        of the RCPS shall deliver to the Company the share certificate(s) for the
        relevant RCPS in exchange for share certificates in relation to the relevant
        amount of Conversion Shares resulting from the conversion of those
        RCPS.  If any share certificate so

       

      
        
          
             
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      delivered
        to the Company relates to any RCPS which are not to be converted on that
        day, a
        fresh share certificate for those RCPS shall be immediately issued by the
        Company to such holder(s).

       

       

      6.           
        [Deleted]

       

       

      7.           
        Redemption Rights

       

      
        	
                 

              	
                The
                  holders of the RCPS may at any time after the Subsequent Closing
                  by giving
                  a thirty (30) day notice of redemption in such form as may be acceptable
                  to the Company (“Notice
                  of Redemption”), redeem any or all RCPS registered in the name of
                  the holder of the RCPS. The RCPS will be redeemable from funds
                  legally
                  available for distribution at a par value of RM0.01 with premium
                  equivalent to the difference between the Subscription Price and
                  the par
                  value of RM0.01 per RCPS  plus all accrued but unpaid dividends
                  and dividends in arrears, if any (“Redemption
                  Price”).   

              

      

       

      

      All
        redemption of the RCPS shall be effected at the registered office of the
        Company
        unless agreed otherwise by the holder(s) of the RCPS and the
        Company.  On the date fixed for redemption, the holder(s) of the RCPS
        shall deliver to the Company the share certificate(s) for the relevant RCPS
        in
        exchange for payment in cash (by way of bank draft or any other manner
        acceptable to the holder(s)) by the Company of the aggregate Redemption Price
        for the time being payable for those RCPS.  If any share certificate
        so delivered to the Company relates to any RCPS which are not to be redeemed
        on
        that day, a fresh share certificate for those RCPS shall be issued by the
        Company to such holder(s).

       

      No
        RCPS
        redeemed by the Company shall be capable of reissue.

       

       

      8.           
        Voting Rights

       

      

      The
        holder of the RCPS will be entitled to the voting rights as referred to in
        Section 148(2) of the Act.

       

       

      9.           
        Protective Provisions

       

      

      Without
        the approval of the holders of at least a majority of the RCPS, the Company
        will
        not take any action, whether by merger, consolidation or otherwise,
        that:

       

      
        	
                (a)  

              	
                effects
                  a sale, lease, license or other disposition of all or substantially
                  all of
                  the Company’s assets, property or business or
                  undertakings;

              

      

       

      
        	
                (b)  

              	
                effects
                  or enters into any agreement regarding any transaction, or series
                  of
                  transactions, which results in the holders of the RCPS prior to
                  the
                  transaction owning less than 50% of the voting power of the Company’s RCPS
                  after the transaction(s),

              

      

       

      
        	
                (c)  

              	
                alters
                  or changes the rights, preferences or privileges of the
                  RCPS,

              

      

       

      
        	
                (d)  

              	
                increases
                  or decreases the number of authorized the
                  RCPS,

              

      

       

      
        
          
             
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                (e)  

              	 

      

       

      
        	
                (f)  

              	
                authorises
                  the issuance of securities having a preference over or on a parity
                  with
                  the RCPS,

              

      

       

      
        	
                (g)  

              	
                changes
                  the number of directors,

              

      

       

      
        	
                (h)  

              	
                amends,
                  modifies or repeals the Memorandum of Association and/or Articles
                  of the
                  Company in a manner which adversely affects the holders of the
                  RCPS,

              

      

       

      
        	
                (i)  

              	
                effects
                  any recapitalization or reorganization, or any voluntary or involuntary
                  liquidation under applicable bankruptcy or reorganization legislation,
                  or
                  any dissolution, liquidation, or winding up of the
                  Company,

              

      

       

      
        	
                (j)  

              	
                declares
                  or pays dividends on or makes any distributions with respect to
                  any share
                  capital of the Company.

              

      

       

      For
        purposes of these protective provisions, any reference to the Company will
        be
        deemed to include any subsidiary of the Company.

       

       

      10.           
        No Variation

       

      The
        rights attached to the RCPS shall not be varied, modified or deleted unless
        in
        accordance with paragraph 9 above.

       

      

       

      [The
        remainder of this page is
        intentionally left blank]

       

      
        
          
             
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      SCHEDULE
        2

       

      

      Representations
        and Warranties

       

      1.           
        Representations and Warranties by the Investor

       

      The
        Investors warrant to the Company as follows.

       

      
        	
                 

              	
                1.1

              	
                Capacity
                  and
                  Authority

              

      

       

      The
        Investor is duly incorporated and validly exist under the laws of Malaysia
        and
        has the power to own its assets and carry on its business as now being
        conducted.

       

      
        	
                 

              	
                1.2

              	
                Power
                  to execute this
                  Agreement

              

      

       

      
        	
                 

              	
                (a)

              	
                The
                  Investor has the right, power and authority, and have taken or
                  will take
                  all action necessary, to validly execute, deliver and exercise
                  its right,
                  and perform its obligations under this Agreement;
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                Other
                  than those set out in this Agreement, no other consent, approval,
                  authorization or other order of any court, regulatory body, administrative
                  agency or other order of any other governmental body is required
                  for the
                  execution and delivery by the Investor of this Agreement or the
                  performance by the Investor of the transactions contemplated under
                  this
                  Agreement; 

              

      

       

      
        	
                 

              	
                (c)

              	
                This
                  Agreement is a valid and binding obligation of the Investor and
                  is
                  enforceable against the Investor in accordance with its terms;
                  

              

      

       

      
        	
                 

              	
                (d)

              	
                The
                  execution, delivery and performance of this Agreement will not
                  violate any
                  judgment, order or decree to which the Investor are subject and
                  will not
                  be inconsistent with any constitutional documents or contracts
                  to which
                  the Investor are a party to or otherwise binding on the Investor;
                  and
                  

              

      

       

      
        	
                 

              	
                (e)

              	
                There
                  is no action, proceeding, claim or investigation pending against
                  the
                  Investor before any court or administrative authority, which, if
                  determined against the Investor, may reasonably be expected to
                  have a
                  material adverse effect on the Investor’s ability to perform the
                  obligations hereunder. 

              

      

       

       

      
        	
                2.

              	
                Representations
                  and Warranties by the Existing Shareholder and the Company
                  

              

      

       

      
        	
                 

              	
                The
                  Existing Shareholder and the Company warrant to the Investor as
                  follows.
                  

              

      

       

      
        	
                 

              	
                2.1

              	
                Capacity
                  and
                  Authority

              

      

       

      The
        Company is duly incorporated and validly exists under the laws of Malaysia
        and
        has the power to own its assets and carry on the Business.

       

      
        	
                 

              	
                2.2

              	
                Power
                  to execute this
                  Agreement

              

      

       

      
        
          
               

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

       

      
        	
                 

              	
                (a)

              	
                The
                  Existing Shareholder and Company have the right, power and authority,
                  and
                  has taken or will take all action necessary, to validly execute,
                  deliver
                  and exercise its right, and perform its obligations under this
                  Agreement;
                  

              

      

       

      
        	
                 

              	
                (b)

              	
                Other
                  than those set out in this Agreement, no other consent, approval,
                  authorization or other order of any court, regulatory body, administrative
                  agency or other order of any other governmental body is required
                  for the
                  execution and delivery by the Existing Shareholder and the Company
                  of this
                  Agreement or the performance by the Existing Shareholder and the
                  Company
                  of the transactions contemplated under this Agreement;
                  

              

      

       

      
        	
                 

              	
                (c)

              	
                This
                  Agreement is a valid and binding obligation of the Existing Shareholder
                  and the Company and after fulfillment of the conditions precedent
                  is
                  enforceable against the Existing Shareholder and the Company in
                  accordance
                  with its terms; 

              

      

       

      
        	
                 

              	
                (d)

              	
                The
                  execution, delivery and performance of this Agreement will not
                  violate any
                  judgment, order or decree to which the Existing Shareholder and
                  the
                  Company is subject and save as otherwise disclosed, will not be
                  inconsistent with any constitutional documents or contracts to
                  which the
                  Existing Shareholder and/or the Company is a party to or otherwise
                  binding
                  on the Existing Shareholder and/or the Company; and
                  

              

      

       

      
        	
                 

              	
                (e)

              	
                There
                  is no action, proceeding, claim or investigation pending against
                  the
                  Existing Shareholder and/or the Company before any court or administrative
                  authority, which, if determined against the Existing Shareholder
                  and/or
                  the Company, may reasonably be expected to have a material adverse
                  effect
                  on the Existing Shareholder and the Company’s ability to perform the
                  obligations hereunder. 

              

      

       

       [The
        remainder of this page is
        intentionally left blank]

       

      
        
          
          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

       

      SCHEDULE
        3

       

       

      Subscription
        Notice

       

      

       

      

       

      From
        :                                
Wafergen Biosystems (M) Sdn Bhd

       

      

       

      To
        :                      
[Investor]

       

      

       

      SHARE
        SUBSCRIPTION AND SHAREHOLDERS AGREEMENT DATED ** (“Subscription
        Agreement”)

       

      

       

      We
        refer to the Subscription Agreement
        made between yourselves, the Existing Shareholder, and us. Terms defined
        in the
        Subscription Agreement have the same meanings when used in this
        notice.

       

      We
        hereby give you notice, in
        accordance with the terms and conditions of the Subscription Agreement, of
        your
        required subscription for 444,444 of the RCPS at a total Subscription Price
        of
        USD1,000,000 (equivalent to RM ** based on the exchange rate as at **), such
        subscription to be completed on [date] at [time], being the [Initial
        Closing/Subsequent Closing] (delete whichever is not
        applicable).

       

      

       

      Dated
        :

       

      

       

      Yours
        faithfully

       

      For
        and
        on behalf of

       

      Wafergen
        Biosystems (M) Sdn Bhd

       

      

       

      By:
        

       

      

       

      Name:
        

       

      

       

      Title:
        

       

      
        
          
             
              | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

       

      

       

       

      Execution

       

      Executed
        as an Agreement.

      

      

      
        	
                
                

                Signed
                  for and on behalf of WaferGen Bio-systems,
                  Inc (WGBS.OB) in the presence of:

                
                

                
                

                
                

                
                

                
                

              	 	 
	 /s/
                Nazri Bin Said	 	 /s/
                Alnoor Shivji
	
                
                

                Witness

              	 	
                
                

                Signatory

              
	
                
                

                Name:
                  Nazri Bin Said

              	 	
                
                

                Name:
                  Alnoor Shivji 

              
	
                
                

                NRIC
                  No: 550571025665

              	 	
                
                

                Designation:
                  CEO

              
	 	 	
                
                

                NRIC
                  No:

              

      

      

      

      

      
        	
                
                

                Signed
                  for and on behalf of Malaysian Technology
                  Development Corporation Sdn Bhd (Company No 235796-U) in the
                  presence of:

                
                

                
                

                
                

                
                

                
                

              	 	 
	 /s/
                Mohdazmi Mahd Lila	 	 /s/
                Azlin Alias
	
                
                

                Witness

              	 	
                
                

                Signatory

              
	
                
                

                Name:
                  Mohdazmi Mahd Lila

              	 	
                
                

                Name:
                  Azlin Alias

              
	
                
                

                NRIC
                  No: 641209-11-5213

              	 	
                
                

                Designation:
                  CEO

              
	 	 	
                
                

                NRIC
                  No: 671012-10-5297

              

      

      

      
        
          
             
              | 

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
             

          

        

      

      

      

      
        	
                
                

                Signed
                  for and on behalf of Wafergen Biosystems
                  (M) Sdn Bhd
                  (formerly known as Global Dupleks Sdn Bhd) (Company
                  No 795066-H)
                  in the presence of:

                
                

                
                

                
                

                
                

                
                

              	 	 
	 /s/
                Nazri Bin Said        	 	 /s/
                Alnoor Shivji
	
                
                

                Witness

              	 	
                
                

                Signatory

              
	
                
                

                Name:
                  Nazri Bin Said

              	 	
                
                

                Name:
                  Alnoor Shivji

              
	
                
                

                NRIC
                  No: 550571025665

              	 	
                
                

                Designation:
                  CEO

              
	 	 	
                
                

                NRIC
                  No:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00149-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00149-of-00352.parquet"}]]