SEC Form 424B3 filed by Delwinds Insurance Acquisition Corp.

Filed Pursuant to Rule 424(b)(3)

Registration No. 333-272892

PROSPECTUS SUPPLEMENT NO. 15

(to Prospectus dated July 6, 2023)

FOXO Technologies Inc.

Up to 19,312,823 Shares of Class A Common Stock

This prospectus supplement is being filed to update and supplement the information contained in the prospectus dated July 6, 2023 (the “Prospectus”), which forms a part of our registration statement on Form S-1 (File No. 333-272892) with the information contained in our current report on Form 8-K, filed with the Securities and Exchange Commission on January 19, 2024 (the “Current Report”). Accordingly, we have attached the Current Report to this prospectus supplement.

The Prospectus and this prospectus supplement relate to the potential offer and resale from time to time by the selling stockholders named in the Prospectus or their permitted transferees (the “Selling Stockholders”) of up to 19,312,823 shares of Class A common stock (the “Class A Common Stock”), which consists of (i) 7,955,948 shares of Class A Common Stock issued to those Selling Stockholders that tendered warrants to purchase one share of Class A Common Stock per warrant at an exercise price per share of $6.21, subject to adjustment (the “Assumed Warrants”), pursuant to the Offer to Exchange Warrants to Acquire Shares of Class A Common Stock and Consent Solicitation, commenced on April 27, 2023, by us (the “Exchange Offer”), which Assumed Warrants were originally issued to accredited investors by FOXO Technologies Operating Company (“Legacy FOXO”) in a private placement of convertible debentures and warrants to purchase shares of Class A common stock of Legacy FOXO and assumed by us pursuant to the business combination of our predecessor, Delwinds Insurance Acquisition Corp., and Legacy FOXO consummated on September 15, 2022, (ii) 4,321,875 shares of Class A Common Stock issued to those Selling Stockholders that approved certain amendments to our 15% Senior Promissory Notes pursuant to the Offer to Amend 15% Senior Promissory Notes and Consent Solicitation, commenced on April 27, 2023, by us, and (iii) 7,035,000 shares of Class A Common Stock issued in exchange for a general release to certain Selling Stockholders that previously held 10% Original Issue Discount Convertible Debentures issued in 2022 by Legacy FOXO. We will not receive any proceeds from the sale of shares of Class A Common Stock by the Selling Stockholders.

Our Class A Common Stock is currently listed on the NYSE American LLC under the symbol “FOXO.” On January 22, 2024, the closing price of our Class A Common Stock was $0.2950. Our Public Warrants are currently quoted on the OTC Pink Marketplace under the symbol “FOXOW.” On January 22, 2024, the closing price of our Public Warrants was $0.0025.

This prospectus supplement updates and supplements the information in the Prospectus and is not complete without, and may not be delivered or utilized except in combination with, the Prospectus, including any amendments or supplements thereto. This prospectus supplement should be read in conjunction with the Prospectus and if there is any inconsistency between the information in the Prospectus and this prospectus supplement, you should rely on the information in this prospectus supplement.

We are an “emerging growth company” as the term is used in the Jumpstart Our Business Startups Act of 2012 and will be subject to reduced public company reporting standards. As such, we have elected to comply with certain reduced public company reporting requirements for this and future filings.

INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISKS THAT ARE DESCRIBED IN THE “RISK FACTORS” SECTION BEGINNING ON PAGE 11 OF THE PROSPECTUS.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if the Prospectus or this prospectus supplement is accurate or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is January 23, 2024.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date Earliest Event Reported): January 12, 2024

FOXO TECHNOLOGIES INC.

(Exact name of registrant as specified in its charter)

(612) 562-9447

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry Into A Material Definitive Agreement.

Effective January 12, 2024, Foxo Technologies Inc., a Delaware corporation (the “Company” or the “Licensee”), entered into the Master Software and Services Agreement (this “Agreement”) with KR8 AI Inc., a Nevada corporation (the “Licensor”). Our Interim CEO and Interim CFO each are equity owners of the Licensor. Under the Agreement, the Licensor granted to the Licensee a limited, non-sublicensable, non-transferable perpetual license to use the “Licensor Products” listed in Exhibit A to the Agreement, to develop, launch and maintain license applications based upon Licensee’s epigenetic biomarker technology and software to develop an AI machine learning epigenetic APP to enhance health, wellness and longevity. The territory of the Agreement is solely within the U.S., Canada and Mexico.

Under the Agreement, the Licensee agreed to pay to the Licensor an initial license and development fee of $2,500,000, a monthly maintenance fee of $50,000, and an ongoing royalty equal to 15% of “Subscriber Revenues,” as defined in the Agreement, in accordance with the terms and subject to the minimums set forth in the schedules of the Agreement. The Licensee agreed to reimburse the Licensor for all reasonable travel and out-of-pocket expenses incurred in connection with the performance of the services under the Agreement, in addition to payment of any applicable hourly rates. If the Licensee fails to timely pay the “Minimum Royalty,” as defined in the Agreement, due with respect to any calendar year, the License will become non-exclusive.

The initial term of this Agreement commences on the effective date of the Agreement. Unless terminated earlier in accordance with the terms, the Agreement will be perpetual. Either party may terminate the Agreement, effective on written notice to the other party, if the other party materially breaches this Agreement, and such breach remains uncured 30 days after the non-breaching party provides the breaching party with written notice of such breach, in which event, the non-breaching party will then deliver a second written notice to the breaching party terminating this Agreement, in which event the Agreement, and the licenses granted under the Agreement, will terminate on the date specified in such second notice. Either party may terminate the Agreement, effective immediately upon written notice to the other party, if the other party: (i) is unable to pay, or fails to pay, its debts as they become due; (ii) becomes insolvent, files or has filed against it, a petition for voluntary or involuntary bankruptcy or otherwise becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law; (iii) makes or seeks to make a general assignment for the benefit of its creditors; or (iv) applies for or has appointed a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.

Licensee may terminate the Agreement at any time upon 90 days’ notice to the Licensor provided that, as a condition to such termination, the Licensee immediately ceases using any Licensor Products. The Licensor may terminate the Agreement at any time upon 30 days’ notice to the Licensee if the Licensee fails to pay any portion of the “Initial License Fee,” as defined in the Agreement.

The foregoing description of the Agreement does not purport to be complete and is qualified in its entirety by reference to the Agreement, which is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

Item 3.02 Unregistered Sales of Equity Securities.

The disclosure set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

Under the Agreement, on January 19, 2024, the Company issued 1,300,000 shares of Common Stock to the Licensor. The sale of the shares was exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on an exemption provided by Rule 506(b) of Regulation D of the Securities Act. The Company did not pay any commissions or finder’s fees in connection with the sale.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Exhibit 99.1

MASTER SOFTWARE AND SERVICES AGREEMENT

This Master Software and Services Agreement (this “Agreement”), effective as of January 12, 2024 (the “Effective Date”), is by and between KR8 AI Inc., a Nevada corporation with an address at 112 North Curry Street, Carson City, Nevada 89703 (“Licensor”) and FOXO Technologies Inc., a Delaware corporation with offices located at 729 N. Washington Ave., Suite 600, Minneapolis, MN 55401 (“Licensee”). Licensor and Licensee may be referred to herein collectively as the “Parties” or individually as a “Party.”

R E C I T A L S:

Licensee desire to develop and launch application services (“Licensee Applications”) pursuant to which, Licensee will be able to distribute to end users (“End Users”) an AI machine learning epigenetic APP to enhance health, wellness and longevity;

To facilitate the development of the Licensee Applications Licensee desires that, subject to the terms and conditions hereof, Licensor provide it with a license to use Licensor Products underlying the KR8 AI eco system and iOS/Android APP software previously viewed by Licensee and provide ongoing support, upgrades, maintenance, and administration services related thereto.

In consideration of the mutual covenants, terms, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

LICENSEE AND LICENSOR WILL NOT BE LIABLE, WHETHER IN CONTRACT OR IN TORT (INCLUDING BREACH OF WARRANTY, NEGLIGENCE AND STRICT LIABILITY IN TORT), FOR INDIRECT OR CONSEQUENTIAL, EXEMPLARY, PUNITIVE OR SPECIAL DAMAGES ARISING OUT OF OR RELATING TO ITS PERFORMANCE OR FAILURE TO PERFORM UNDER THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES IN ADVANCE.

IN NO EVENT WILL THE COLLECTIVE AGGREGATE LIABILITY OF LICENSOR, ITS SUBSIDIARIES, AFFILIATES, SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES AND ITS LICENSORS, SERVICE PROVIDERS, AND SUPPLIERS (“THE PARTIES”), UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ITS SUBJECT MATTER, UNDER ANY LEGAL OR EQUITABLE THEORY, INCLUDING BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, AND OTHERWISE, EXCEED THE AMOUNT OF FEES PAID OR PAYABLE BY LICENSEE UNDER THIS AGREEMENT FOR THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE LAST ACT OR OMISSION GIVING RISE TO SUCH LIABILITY. THE FOREGOING LIMITATION APPLIES NOTWITHSTANDING THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE. IF ANY APPLICABLE AUTHORITY HOLDS ANY PORTION OF THIS SECTION TO BE UNENFORCEABLE, THEN THE PARTIES’ LIABILITY WILL BE LIMITED TO THE FULLEST POSSIBLE EXTENT PERMITTED BY APPLICABLE LAW. LICENSEE WILL INDEMNIFY, DEFEND AND HOLD HARMLESS LICENSOR FOR ANY LOSS, DAMAGE OR COST IN CONNECTION WITH ANY CLAIM OR ACTION WHICH MAY BE BROUGHT BY ANY THIRD PARTY AGAINST LICENSOR RELATING TO ANY BREACH OF THIS AGREEMENT BY LICENSEE.

Exhibit “A”: Definitions

Exhibit “B”: Service Level and Support Services Agreement

Exhibit “C”: Services and Features

Schedule “1”: Order Form

Schedule “2”: Form of Service Order

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

EXHIBIT A

DEFINITIONS

“Acceptance Criteria” means, with respect to a Licensor Product, (i) the Specifications applicable to such Licensor Product and (ii) any other requirement set forth in this Agreement that applies at the time of performance, provision or delivery of such Licensor Product.

“Affiliate” means any individual, corporation, partnership, limited liability company, association or similar business organization that directly or indirectly, through one or more intermediaries, Controls, or is Controlled by, or is under common Control with a party or its successors. Affiliates shall include such entities whether now existing or later established by investment, merger or otherwise, including the successors and assigns of such entities.

“APP” means a software-as-a-service application other than those to be provided by Licensor to Licensee.

“Application” means the software-as-a-service application provided hereunder by Licensor to Licensee, including the rules, routines, machine readable object code and source code associated therewith, and including any modifications, Updates, Upgrades, enhancements, improvements or customizations by way of Services or otherwise by either party that are developed or released during the term of the applicable Schedule or Order Form. In addition, the term “Application” shall include the Documentation relating thereto and any third party software embedded in the Application.“Authorized User” means an employee or contractor of Licensee who Licensee permits to access and use the Software and/or Documentation pursuant to Licensee’s license hereunder.

“Billing Start Date” shall mean the date identified on the order form as the date from which billing shall be calculated (which under no circumstances shall be later than the Service Start Date, as defined below).

“Control”, including the terms “controlling”, “controlled by”, and “under common control with” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of voting securities (or other ownership interest), by contract, right to elect a majority of the governing board, or otherwise.

“Deliverables” means the deliverables to be produced and delivered to Licensee or any Licensee Affiliate under this Agreement, as more particularly described in a Schedule or Order Form. Deliverables may include Software, documents, reports, Specifications, operating instructions, working papers, work in progress, video, film, multimedia, pictures, graphs and audio material, whether preliminary or final, in or on any media whether now existing or developed in the future.

“Documentation” means Licensor’s user manuals, handbooks, and installation guides relating to the Software provided by Licensor to Licensee either electronically or in hard copy form.

“Fees” shall mean the fees payable pursuant to Section 8.

“Initial License Fee” see Section 8.

“Intellectual Property Rights” means any and all registered and unregistered rights granted, applied for, or otherwise now or hereafter in existence under or related to any patent, copyright, trademark, trade secret, database protection, or other intellectual property rights laws, and all similar or equivalent rights or forms of protection, in any part of the world.

“Licensee Data” means information, data, and other content, in any form or medium, that is submitted, posted, or otherwise transmitted by or on behalf of Licensee or an Authorized User.

“Licensor IP Rights” means Intellectual Property Rights owned or licensed by Licensor or any Licensor Affiliate including, without limitation, patents, copyrights, trademarks, service marks, trade secrets and know-how owned or otherwise licensable by Licensor or any Licensor Affiliate or which are acquired by, developed by or on behalf of Licensor in the course of performances of Services under this Agreement, and without reference to or use of any Intellectual Property Rights owned or licensed by Licensee or any Licensee Affiliate.

“Licensor Product(s)” means any Application, Software, Services, Deliverables, Equipment or other related materials that are licensed, purchased or otherwise acquired by Licensee pursuant to this Agreement.

“Order Form” means an Order Form or similar agreement appurtenant to this Agreement for the provision of Professional Services or Deliverables, which sets out the commercial terms and is executed by the parties and substantially in the form of Schedules attached hereto.

“Professional Services” means those services performed by Licensor for Licensee under this Agreement, which are not included within the meanings of the terms “Subscription Services” or “Support Services”, including preparation, configuration, delivery and installation of Licensor Products.

“Purchase Order” shall mean a purchase order issued by Licensee in connection with Licensor Products described in a Schedule or Order Form.

“Resultant Data” means (i) data and information generated from Licensee’s use of the Services that is used by Licensor in an aggregate and anonymized manner, including to compile statistical and performance information related to the provision and operation of the Services; and (ii) output generated from Licensee Data but shall not mean or include: (a) Licensee Data, whether in aggregated or anonymized form or otherwise manipulated or altered, or (b) personal information, unique identifiers, mobile network information including carrier names and phone numbers, location data or IP addresses of Authorized Users.

“Schedules” shall mean the Schedules expressly referenced in and attached to this Agreement.

“Services” means the Professional Services, Subscription Services and Support Services performed (or to be performed) by Licensor for Licensee or any Licensee Affiliate under this Agreement, as more particularly described in a Schedule or Order Form. Services shall be deemed to include all incidental services, functions, responsibilities or tasks not specifically described in this Agreement or a Schedule or Order Form hereunder, but which are an inherent, necessary or customary part of the services performed (or to be performed) by Licensor hereunder or that are required or reasonably necessary for the proper performance and provision of the Licensor Products provided (or to be provided) by Licensor hereunder.

“Service Start Date” shall mean the date from which Licensee receives the applicable Service.

“Software” means the software consisting of proprietary technology including capabilities in KR8 AI eco system and iOS/Android APP artificial intelligence and inference engine and related Documentation, including any Updates provided to Licensee pursuant to this Agreement.

“Specifications” means any and all technical, design or functional specifications for, and descriptions of, the capabilities of any Licensor Product, including those set forth in the applicable Schedule or Order Form, and (to the extent not inconsistent therewith) those contained in Licensor’s Documentation, descriptive documents and/or marketing materials, or applicable request for proposal and any Licensor response thereto, the terms of which are incorporated by reference in the applicable Schedule or Order Form.

“Subscriber Revenues” – means all revenues received by Licensee or its affiliates from End User for use of the Licensee Applications, inclusive of up-front or downloading fees, periodic fees and per-use charges, net of any allowances or discounts allowed and taxes or other governmental charges levied on or measured by the amount charged by Licensee. Subscriber Revenues shall not include revenues received from affiliates but shall include the revenues received by such affiliates from End Users.

“Subscription Services” means Licensee’ access and use of Licensor’s provision of the Software and/or Application in accordance with the terms of this Agreement.

“Support Services” means those maintenance and support services performed by the Licensor for Licensee under this Agreement, as more particularly described in a Schedule or Order Form and for which Licensee has contracted for support, which shall commence upon acceptance by Licensee of the applicable Licensor Product.

“Term” shall mean the longer period of 1) the term of this Agreement, and 2) the period identified in the order form, or any renewal term, as applicable.

“Third-Party Products” means any third-party products described in Exhibit C provided with or incorporated into the Software, including any open-source software available under the GNU Affero General Public License (AGPL), GNU General Public License (GPL), GNU Lesser General Public License (LGPL), Mozilla Public License (MPL), Apache License, BSD licenses, or any other license that is approved by the Open Source Initiative.

“Update” means updates, revisions or additions to a Licensor Product that are intended to correct errors, improve efficiency or to incorporate additional or alternative functionality, but that do not constitute substantial additional or alternative functionality, as customarily indicated by a change to the number to the right of the decimal in the version number, for example, Version 2.1 updated to Version 2.2.

“Upgrade” means a new release of a Licensor Product in question that incorporates substantial additional or alternative functionality, as customarily indicated by a change to the number to the left of the decimal in the version number, for example, Version 2.1 upgraded to Version 3.0.

EXHIBIT B

SERVICE LEVEL AND SUPPORT SERVICES AGREEMENT SCHEDULE

During the Term, Licensor will make available a technical point of contact for Licensee technical support inquiries. The purpose of Support Services is to resolve defects that cause any Licensed Product included within the Licensee Applications to fail to conform to its purpose. A resolution to a defect may consist of a fix or patch, a reasonable workaround, or other resolution as Licensor deems reasonable. Support Services do not include any Professional Services, such as implementation, configuration, integration, customization, or training services, or assistance with administrative functions.

Licensor will use reasonable efforts to meet the response time objectives during U.S. support hours.

EXHIBIT C

INITIAL LICENSOR PRODUCTS

The initial services and features in the Licensor Products to be provided by Licensor are:

1-Core AI Engine:

2-Data Integration:

3-User Experience:

4-Algorithm Customization:

5-Scalability and Deployment:

SCHEDULE 1

ORDER FORM

Billing Start Date: ____________________

Service Start Date: ____________________

Reference is made to that certain Master Software and Service Agreement by and between KR8 AI INC. (the “Licensor”) and FOXO Technologies Inc., dated as of January 12, 2024, (as amended, supplemented or otherwise modified from time to time, the “Agreement”), the terms of which are hereby incorporated herein. This “Order Form” is an Order Form referred to in said Agreement. All capitalized terms used herein shall have the same meaning as ascribed to them in the Agreement unless otherwise defined herein. Each Order Schedule listed below is an independent obligation of the Parties, and each Order Schedule if not entered into as of the Effective Date shall commence as of the commencement date set forth in the relevant Order Schedule.

In consideration of the Licensor Products set forth in Exhibit C to the Agreement and the Development Services to be provided during the period commencing as of the date hereof and ending on the eighteenth month anniversary of November 15, 2023, Licensee shall pay to Licensor, on the terms and conditions set forth herein:

1. Software License Fee Schedule.

A non-refundable, non-recoupable Initial License and Development Fee of $2,500,000 (the “Initial License Fee”), to be paid as follows:

(i) $2,000,000 will be payable in cash in monthly increments of $100,000; provided, however, (a) with the written consent of Licensor in its sole discretion, and pursuant to the rules of any exchange on which the Common Stock is listed portions of the cash fee may be paid in shares of class A common stock of Licensee (“Common Stock”) and (b) for so long as the Common Stock is listed on a major exchange, commencing on July 1, 2024, if the average trading volume exceeds $50,000 per day for the ten (10) trading days preceding any scheduled date of payment, up to 1/3rd of the monthly fee payable on such date may be paid in shares of Common Stock of Licensee.

(ii) the remaining $500,000, or such lesser amount as will not require approval of stockholders of Licensee pursuant to the rules of any exchange on which the Common Stock is listed, shall be paid in Common Stock of Licensee valued at 102% of the market value of the Common Stock as of the date hereof which shall be issued to Licensee within twenty (20) days of the date hereof. If any portion of the $500,000 of Common Stock may not be issued to Licensor without the consent of the stockholders of Licensee, such portion shall be added to the portion of the Initial License Fee to be paid in cash and such portion shall be paid in twelve equal monthly increments commencing January 1, 2024, through December 1, 2024.

2. Professional Service Fee and Deliverables.

The fee for Professional Services to be rendered by Licensor’s personnel during the period commencing as of the date hereof and ending on the eighteenth month anniversary of November 15, 2023, in connection with the development of the items set forth on Schedule C, shall be deemed satisfied by payment of the Initial License Fee. The Parties acknowledge and agree that the Initial License Fee is non-refundable.

3. Support and Maintenance Services

For so long as this Agreement remains in effect. a fee of $50,000 per month (the “Maintenance Fee”) shall be paid in advance on the first day of each month commencing December 1, 2024, for support services as set forth on Exhibit B (“Support Services Description”)

4. Royalty Payments.

In addition to the License and Development Fee and the Maintenance Fee Licensee shall pay to Licensor, earned royalties (the “Running Royalties”) equal to fifteen percent (15%) of Subscriber Revenues generated by Licensee Applications. Subscriber Revenues are deemed earned as of the date of receipt by Licensee. Within thirty (30) days after the end of each calendar quarter ending on March 31, June 30, September 30 or December 31 (“Calendar Quarter”) occurring during the Term, Licensee shall pay to Licensor all Running Royalties due in respect of the Subscriber Revenues received during such quarter.

Minimum Royalty. Beginning with calendar year 2024, Licensee shall pay Licensor minimum annual Royalty payments as follows (the “Minimum Royalty”):

(c) In the event the Running Royalty payable to Licensor with respect to any calendar year is less than the Minimum Royalty for such year, then, either: (i) to maintain the exclusivity of the license granted hereunder, Licensee, shall remit to Licensee within forty-five (45) days of the end of such calendar year, a sum of money equal to the excess of the applicable Minimum Royalty over the Running Royalty for such year; or (ii) the License granted hereunder shall become non-exclusive forty-five (45) days after the end of such calendar year.

(d) Within thirty (30) days after each Calendar Quarter occurring during the Term, Licensee shall furnish Licensor a written report covering such quarter showing: (i) the Subscriber Revenues derived from Licensee Applications during such period and, in the case of the 2^nd through 4^th quarter of each calendar year, on a year to date basis; (ii) the Running Royalty, payable in Dollars, which has accrued hereunder in favor of Licensee in respect of such Revenues; and (iii) withholding taxes, if any, required by law to be deducted in respect of such Revenues. The report shall be accompanied by the payment of royalty monies due at that time.

(e) Except as otherwise provided, any payments due hereunder on sales made by Licensee in a currency other than US Dollars shall be payable to Licensor in United States Dollars at the prevailing rate of exchange of the currency in which the sales are made (said exchange rate being taken as the rates published in the Wall Street Journal under the caption “Currency Trading -- Exchange Rates” on the last business day of the Calendar Quarter for which the royalties are payable).

(f) Any sum required under the tax laws of the United States or any other country, to be withheld by Licensee from payments to Licensor, shall be promptly paid by Licensee for and on behalf of Licensor to the appropriate tax authorities and Licensee shall furnish Licensor with official tax receipts or other appropriate evidence issued by the appropriate tax authorities sufficient to enable Licensor to support a claim for income tax credit in respect of any sum so withheld.

5. Principal Contacts

IN WITNESS WHEREOF, the Parties hereto have executed this Order Form as of the date first above written.

SCHEDULE 2

FORM OF SERVICE ORDER

Service Order #___

Date: ____________________________

THIS IS SERVICE ORDER #____, BEING EXECUTED PURSUANT TO THE PROCEEDING AGREEMENT.

Project: ____________________ Hourly Rate: _____ Actual # of Hours _____ Billed # of Hours ____ Actual Cost ______ Billed Cost ______

Total: $ ________________________ (ESTIMATE FOR PROJECT)

Notes:

1. Above fees are billed in advance.

2. All work is performed on a time and materials basis. This Service Order is a good faith estimate of the work required to complete the Service Order based on past experience and basic analysis of the project.

Professional Services Rate Schedule:

Development Resource: $______ per hour

Account Management Resource: $______per hour

Accepted by: Licensee:

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