EXHIBIT 10.2 JOINT DEVELOPMENT AGREEMENT

Exhibit A   Definitions

Exhibit B   Milestones

Schedule 1   MCEL-Contributed Intellectual Property

Schedule 2   Excluded Intellectual Property

THIS JOINT DEVELOPMENT AGREEMENT   (this “ Agreement ”) is made and entered into on this __ day of __________, 2005 (the “ Effective Date ”) by and between THE DOW CHEMICAL COMPANY, a Delaware corporation (“ Dow ”) and MILLENNIUM CELL INC., a Delaware corporation (“ MCEL ”). Dow and MCEL also may be referred to herein individually as a “ Party ” or collectively as the “ Parties .”

WHEREAS, the Parties entered into that certain Stock Purchase Agreement, dated as of February 27, 2005 (the “ Stock Purchase Agreement ”), pursuant to which, among other things, at the First Closing (as defined in the Stock Purchase Agreement), the Parties are to enter into this Agreement;

WHEREAS, the First Closing has occurred and, simultaneously therewith, the Parties are entering into this Agreement pursuant of the Stock Purchase Agreement;

WHEREAS, simultaneously with the entering into of this Agreement, Dow and MCEL have also entered into that certain Cross Licensing and Intellectual Property Agreement, dated as of the Effective Date (the “ Cross Licensing Agreement ”);

WHEREAS, MCEL is engaged in the business of developing fuel systems for the safe storage, transportation and generation of hydrogen for use as an energy source and, in connection therewith, has developed and patented the proprietary system called Hydrogen on Demand ®, whereby the energy potential of hydrogen is carried in the chemical bonds of sodium borohydride, which in the presence of a catalyst, releases hydrogen;

WHEREAS, among other things, Dow is engaged directly and indirectly in developing technologies addressing the increasing need for energy for portable electronics devices;

WHEREAS, the Parties wish to jointly develop portable energy solutions through the production of hydrogen gas for use by fuel cells within the Field of Use (as defined below) and within the Application (as defined below), using certain processes currently being developed by MCEL, as further described in this Agreement;

WHEREAS, in connection with the joint development arrangement described above, and pursuant to the terms and conditions of the Stock Purchase Agreement and this Agreement, MCEL and Dow have agreed that MCEL will (i) upon the execution of this Agreement, issue certain shares of Series A Preferred Stock (as defined below) and (ii) upon the achievement of Milestones 1, 2, 3 and 4 (each as defined below), issue certain shares of Series A Preferred Stock in consideration for Dow providing its commercial and technical services pursuant to this Agreement, as further described in this Agreement and the Stock Purchase Agreement; and

WHEREAS, pursuant to the terms and conditions of the Stock Purchase Agreement, MCEL and Dow have agreed that, upon the achievement of Milestones 1, 2, 3 and 4, MCEL will offer to sell, and Dow may purchase, certain shares of Series B Preferred Stock in consideration for Dow’s equity investments into MCEL, as further described in this Agreement and the Stock Purchase Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein, the Parties agree as follows:

2.       Milestones .

2.1.    Purpose .  The Parties have entered into this Agreement for the purpose of jointly developing portable energy solutions through the production of hydrogen gas for use by fuel cells using certain processes currently being developed by MCEL. In connection therewith, MCEL shall use reasonable best efforts to, among other things, perform the MCEL Military Tasks and the MCEL Consumer Tasks and Dow shall use commercially reasonable efforts when requested by MCEL to perform the Dow Military Tasks and the Dow Consumer Tasks in accordance with this Agreement. By performing these obligations, MCEL will seek to cause the occurrence of the Military Objectives and the Consumer Objectives (if any) contained in the four (4) milestones described in this Article 2 (each, a “ Milestone ” and, collectively, the “ Milestones ”) and, as a result of the occurrence of all the Military Objectives or the Consumer Objectives in any such Milestone, will achieve such Milestone as set forth in the Milestone Table. Upon the achievement of each Milestone, Dow will be entitled to receive Series A Preferred Stock and to purchase Series B Preferred Stock and receive Warrants, subject to the terms and conditions of this Agreement and the other Transaction Agreements.

2.2.    Milestones 1, 2, 3 and 4 .  Each of the four (4) Milestones (“ Milestone 1 ,” “ Milestone 2 ”, “ Milestone 3 ” and “ Milestone 4 ”, respectively) shall be achieved upon the occurrence of either (i) all of the Military Objectives or (ii) all of the Consumer Objectives, in either case, corresponding to such Milestone in the Milestone Table set forth on Exhibit B of this Agreement (the “ Milestone Table ”). Notwithstanding anything to the contrary set forth in the Milestone Table, (i) if Milestone 2 is achieved prior to the achievement of Milestone 1, then Milestone 1 will be deemed to have been achieved upon the achievement of Milestone 2, (ii) if Milestone 3 is achieved prior to the achievement of Milestone 1 and/or Milestone 2, then any prior Milestone that has not been achieved at such time (Milestone 1 and/or Milestone 2, as the case may be) will be deemed to have been achieved upon the achievement of Milestone 3, (iii) if Milestone 4 is achieved prior to the achievement of Milestone 1, Milestone 2 and/or Milestone 3, then any prior Milestone that has not been achieved at such time (Milestone 1, Milestone 2 and/or Milestone 3, as the case may be) will be deemed to have been achieved upon the achievement of Milestone 4. In any such event, all of the Closings (as defined in the Stock Purchase Agreement) preceding the applicable Milestone shall occur simultaneously.

2.3.    Steering Committee .  The Parties shall establish and maintain a steering committee (the “ Steering Committee ”) that will oversee the development activities under, and all other aspects of the relationship contemplated by, this Agreement and facilitate the relationship between Dow and MCEL as explicitly set forth this Agreement. The Steering Committee shall consist of four (4) individuals (each, a “ Committee Member ”), two (2) of which shall be appointed by Dow at its sole discretion and two (2) of which shall be appointed by MCEL at its sole discretion. The initial Committee Members shall be as follows (a) two MCEL-appointed Committee Members shall be: (i) Adam Briggs and (ii) John Battaglini and the two-Dow appointed Committee Members shall be: (i) Director Emerging Energy Platform and (ii) another representative to be appointed in the future; provided , however , either Party may replace such Party’s Committee Members at any time by providing written notice to the other Party. During the Term, the Steering Committee will meet from time to time and in the manner as the Committee Members shall agree. Any action made by the Steering Committee under this Agreement shall only be enforceable if at least seventy-five percent (75%) of the Committee Members agree to such action in writing. Notwithstanding anything to the contrary set forth herein, in no event shall the Steering Committee have the right to modify, amend, supplement, change or waive any provision or term of this Agreement.

2.4.    No Restrictions .  In no event shall the obligations of the Parties contained in this Agreement, the Stock Purchase Agreement, the other Transaction Agreements or transactions contemplated hereby or thereby prevent or in any way prohibit or restrain the either Party from engaging in any activities (including without limitation, development activities, joint development activities, investment activities or otherwise) which may be deemed to be directly or indirectly competitive with the other Party, the current operations of the other Party or the future business plans of the other Party, it being understood that each Party may by itself or in combination with other third parties, develop, manufacture, produce or sell hydrogen fuel cell products; provided, however , each Party’s rights under this Section 2.4 shall be subject to all agreements and restrictions of the Parties with respect to (i) Dow Intellectual Property, MCEL-Contributed Intellectual Property (as defined below) and Joint Development Intellectual Property under this Agreement, the Cross Licensing Agreement and all other Transaction Agreements, (ii) the specific representations, warranties, covenants and agreements contained in the Transaction Agreements and (iii) confidentiality and non-solicitation obligations of the Parties under this Agreement.

3.1.    MCEL-Contributed IP .  MCEL hereby acknowledges and agrees that all patents, copyrights, trade secrets, technical data, designs, concepts, processes, formulae, know-how and information of MCEL as of the date of this Agreement to be used by MCEL in furtherance of the purpose of this Agreement, including without limitation the patents, copyrights and other intellectual property set forth on Schedule 1 , and all know-how and trade secrets embodied therein shall collectively be, “ MCEL-Contributed Intellectual Property ”; provided , however , neither (i) the intellectual property set forth on Schedule 2 of this Agreement nor (ii) the JDA Intellectual Property shall be deemed MCEL-Contributed Intellectual Property. MCEL shall use the MCEL-Contributed Intellectual Property to the extent necessary to meet its obligations under this Agreement.

3.2.    Cross Licensing Agreement .  Simultaneously herewith, the Parties acknowledge and agree that the Parties have entered into the Cross Licensing Agreement with respect to the intellectual property matters related to the transactions contemplated by this Agreement.

4.1.    MCEL Obligations Generally .  During the Term, MCEL shall use its reasonable best efforts to achieve each of the Military Objectives and each of the Consumer Objectives as expeditiously as possible; provided, however, that in the event the Board of Directors of MCEL determines in good faith that it is in the best interests of MCEL to primarily pursue only the Military Objectives or the Consumer Objectives in respect of MCEL’s efforts to achieve the unachieved Milestones (such determination being a “ One-Track Determination ”), then MCEL shall (i) promptly inform Dow that MCEL has made such One-Track Determination and (ii) for the remainder of the Term MCEL shall use its reasonable best efforts to achieve only the Military Objectives or the Consumer Objectives, as the case may be, applicable to such unachieved Milestones.

4.2.    MCEL Obligations Per Milestone .  Without limiting the generality of Section 4.1 , MCEL shall perform, at a minimum, each of the incomplete MCEL Military Tasks and the incomplete MCEL Consumer Tasks on the terms set forth in this Section 4.2 regardless of the Milestone that has been achieved for purposes of the Milestone Table; provided, however, if a Milestone has been achieved under the Milestone Table due to the occurrence of all Military Objectives, on the one hand, or Consumer Objectives, on the other hand, contained in such Milestone, then for the purposes of this Section 4.2 , the Military Objectives or the Consumer Objectives, as applicable, contained in all preceding Milestones shall be deemed to have occurred; provided, further, if MCEL has made a One-Track Determination, then MCEL will only be required to perform such incomplete MCEL Consumer Tasks or such incomplete MCEL Military Tasks, as applicable.

(a)    MCEL Military Tasks - Throughout Term   For the time period commencing on the date hereof and ending upon the earlier of the achievement of the Military Objectives contained in Milestone 4 or the expiration of the Term, MCEL shall (i) identify potential opportunities with military and/or government entities to become Military Customers party to a Military Contract, Production-Ready Military Contract and/or Military P.O. and exercise reasonable best efforts through marketing and business development activities to enhance such potential opportunities; (ii) exercise best efforts to comply with any then-effective Military Contract, Production-Ready Military Contract or Military P.O.; and (iii) prepare the filings for all government/regulatory approvals necessary and appropriate for the use of NaBH ₄ for the military applications contemplated by the Military Objectives, make such filings if and when applicable, and follow up with specific government/regulatory bodies and exercise reasonable best efforts to respond to further application issues as appropriate (the obligations described in this clause (iii) being the “ Military NaBH ₄ Approval Process ”).

(b)    MCEL Military Tasks - Milestone 1 .  From the date hereof until the achievement of the Military Objectives contained in Milestone 1, MCEL shall (i) develop proposed Military Prototype specifications to meet military needs for a fuel cell power source and develop proposed terms for a future Military Contract; (ii) develop and test the proposed Military Prototype and exercise reasonable best efforts to make the appropriate improvements thereto prior to the execution of the Military Contract; (iii) exercise reasonable best efforts to negotiate and execute a bona fide proposed Military Contract; and (iv) exercise reasonable best efforts to test, develop, manufacture and deliver a Military Prototype meeting the specifications of the executed Military Contract.

(c)    MCEL Military Tasks - Milestone 2 .  From the date of achievement of the Military Objectives contained in Milestone 1 until the achievement of the Military Objectives contained in Milestone 2, MCEL shall (i) perform an evaluation of the Military Prototype and MCEL’s performance under the Military Contract to identify areas of improvement; (ii) develop and test the proposed production-ready Military Prototype and exercise reasonable best efforts to make the appropriate improvements thereto prior to execution of the Production-Ready Military Contract; (iii) exercise reasonable best efforts to negotiate and execute a proposed Production-Ready Military Contract; (iv) seek to become the preferred provider or the exclusive provider of the production-ready Military Prototype to the Military Customer under the Production-Ready Military Contract; and (v) exercise reasonable best efforts to test, develop, manufacture and deliver the Military Prototypes meeting the specifications of the executed Production-Ready Military Contract.

(d)    MCEL Military Tasks - Milestone 3 . From the date of achievement of the Military Objectives contained in Milestone 2 until the achievement of the Military Objectives contained in Milestone 3, MCEL shall (i) perform an evaluation of the production-ready Military Prototype and MCEL’s performance under the Production-Ready Military Contract to identify areas of improvement; (ii) develop a manufacturing plan for a Military Product; (iii) if applicable, identify and exercise reasonable best efforts to engage in discussions with potential licensees and suppliers of intellectual property, raw materials and products necessary or helpful for the manufacture of the production-ready Military Product and seek access thereto in anticipation of the Military P.O.; (iv) if applicable, exercise reasonable best efforts to negotiate and enter into appropriate license agreements and supplier agreements in anticipation of the Military P.O.; (v) if applicable, exercise reasonable best efforts to acquire required technology (by merger, acquisition, purchase or otherwise) to perform a proposed Military P.O.; (vi) develop and test the proposed Military Product and exercise reasonable best efforts to make the appropriate improvements thereto prior to the execution of the Military P.O.; and (vii) exercise reasonable best efforts to negotiate and execute a proposed Military P.O.; provided, that clauses (iii) and (iv) of this Section 4.2(d) shall be subject to Section 9.2 .

(e)    MCEL Military Tasks - Milestone 4 . From the date of achievement of the Military Objectives contained in Milestone 3 until the achievement of the Military Objectives contained in Milestone 4, MCEL shall exercise reasonable best efforts to test, develop, manufacture and deliver the Military Products meeting the specifications of the executed Military P.O.

(f)    MCEL Consumer Tasks - Throughout Term . For the time period commencing on the date hereof and ending upon the earlier of the achievement of the Consumer Objectives contained in Milestone 4 and the expiration of the Term, MCEL shall (i) identify potential opportunities with OEMs to be party to a Consumer Contract and/or Consumer P.O. and exercise reasonable best efforts through marketing and business development activities to enhance such potential opportunities; (ii) exercise best efforts to comply with any then-effective Consumer Contract or Consumer P.O.; and (iii) prepare the filings for all government/regulatory approvals necessary and appropriate for the use of NaBH ₄ for the consumer applications contemplated by the Consumer Objectives, make such filings if and when applicable, and follow up with specific government/regulatory bodies and exercise reasonable best efforts to respond to further application issues as appropriate (the obligations described in this clause (iii) being the “ Consumer NaBH ₄ Approval Process ”).

(g)    MCEL Consumer Tasks - Milestone 1 . From the date hereof until the achievement of the Consumer Objectives contained in Milestone 1, MCEL shall (i) develop proposed Consumer Prototype specifications to meet consumer needs for a fuel cell power source and develop proposed terms for any future Consumer Contract; (ii) develop and test the proposed Consumer Prototype and exercise reasonable best efforts to make the appropriate improvements thereto; (iii) exercise reasonable best efforts to solicit letters of support from potential OEMS with respect to the Consumer Prototype; and (iv) exercise reasonable best efforts to attempt to negotiate and execute a bona fide proposed Consumer Contract.

(h)    MCEL Consumer Tasks - Milestone 2 . From the date of achievement of the Consumer Objectives contained in Milestone 1 until the achievement of the Consumer Objectives contained in Milestone 2, MCEL shall exercise reasonable best efforts to test, develop, manufacture and deliver the Consumer Prototypes meeting the specifications of the executed Consumer Contract.

(i)    MCEL Consumer Tasks - Milestone 3 . There are no MCEL Consumer Tasks to be performed in connection with Milestone 3.

(j)    MCEL Consumer Tasks - Milestone 4 . From the date of achievement of the Consumer Objectives contained in Milestone 2 until the achievement of the Consumer Objectives contained in Milestone 4, MCEL shall (i) perform an evaluation of the Consumer Prototype and MCEL’s performance under the Consumer Contract to identify areas of improvement; (ii) develop a manufacturing plan for a Consumer Product; (iii) if applicable, identify and exercise reasonable best efforts to engage in discussions with potential licensees and suppliers of intellectual property, raw materials and products necessary or helpful for the manufacture of the Consumer Product and seek access thereto in anticipation of the Consumer P.O.; (iv) if applicable, exercise reasonable best efforts to negotiate and enter into appropriate license agreements and supplier agreements in anticipation of Consumer P.O.; (v) if applicable, exercise reasonable best efforts to acquire required technology (by merger, acquisition, purchase or otherwise) to perform a proposed Consumer P.O.; (vii) develop and test the proposed Consumer Product and exercise reasonable best efforts to make the appropriate improvements thereto prior to execution of the Consumer P.O.; (viii) exercise reasonable best efforts to negotiate and execute a proposed Consumer P.O.; and (ix) exercise reasonable best efforts to comply with all terms of the executed Consumer P.O.; provided, that clauses (iii) and (iv) of this Section 4.2(j) shall be subject to Section 9.2 .

5.1.    Dow Obligations Generally .

(a)    Dow FTEs Per Milestone . Dow shall, at the request of MCEL, use commercially reasonable efforts to make available to MCEL at a maximum such number of FTEs as follows:

(i)    from the date hereof until the achievement of Milestone 1, Dow shall, at the request of MCEL, make available at a maximum one (1) FTE to use commercially reasonable efforts to (i) perform each of the incomplete Dow Military Tasks set forth in Section 5.2(a) and (b) and/or incomplete Dow Consumer Tasks set forth in Section 5.2(f) and (g) , respectively, and (ii) provide commercial and technical services from Dow’s current resources related to the characterization of chemicals, chemical processes, plastics, and plastic parts with respect to the then-applicable commercially reasonable efforts of Dow under Section 5.2 ;

(ii)    from the date of achievement of Milestone 1 until the achievement of Milestone 2, Dow shall, at the request of MCEL, make available at a maximum three (3) FTEs to use commercially reasonable efforts to (i) perform each of the incomplete Dow Military Tasks set forth in Section 5.2(a) and (c) and/or incomplete Dow Consumer Tasks set forth in Section 5.2(f) and (h) , respectively, and (ii) provide commercial and technical services from Dow’s current resources related to the characterization of chemicals, chemical processes, plastics, and plastic parts with respect to the then-applicable commercially reasonable efforts of Dow under Section 5.2 ; and

(iii)    from the date of achievement of Milestone 2 until the achievement of Milestone 4, Dow shall, at the request of MCEL, make available at a maximum six (6) FTEs to use commercially reasonable efforts to (i) perform each of the incomplete Dow Military Tasks set forth in Section 5.2(a), (d) and (e) and/or incomplete Dow Consumer Tasks set forth in Section 5.2(f), (i) and (j) , respectively, and (ii) provide commercial and technical services from Dow’s current resources related to the characterization of chemicals, chemical processes, plastics, and plastic parts with respect to the then-applicable commercially reasonable efforts of Dow under Section 5.2 ;

provided, however, upon the request of either Party upon the achievement of any Milestone, the Steering Committee shall review whether to change the number of FTEs that Dow shall make available under this Section 5.1(a) ; provided , further , that there shall be no modification of this Section 5.1(a) or the term “FTE” without the written agreement of the Parties.  

Notwithstanding the foregoing, Dow shall only use such commercially reasonable efforts that relate to a Dow Military Task for a Military Objective or a Dow Consumer Task for a Consumer Objective for which MCEL is using its reasonable best efforts to cause to occur; provided, further , if MCEL has made a One-Track Determination, Dow shall only be required to use commercially reasonable efforts to perform the incomplete Dow Military Tasks or Dow Consumer Tasks, as applicable, that MCEL is continuing to pursue and otherwise on the terms of this Article 5.

(a)    Dow Military Tasks - Throughout Term . To the extent required by Section 5.1 above, throughout the Term, Dow Military Tasks shall include (i) assisting MCEL in the identification of potential opportunities with military and/or government entities to become a Military Customer party to a Military Contract, Production-Ready Military Contract and/or Military P.O and (ii) assisting MCEL in the Military NaBH ₄ Approval Process. 

(b)    Dow Military Tasks - Milestone 1 . To the extent required by Section 5.1 above, from the date hereof until the achievement of the Military Objectives contained in Milestone 1, Dow Military Tasks shall include assisting MCEL in its efforts to secure funding under and enter into the Military Contract.

(c)    Dow Military Tasks - Milestone 2 . To the extent required by Section 5.1 above, from the date of achievement of the Military Objectives contained in Milestone 1 until the achievement of the Military Objectives contained in Milestone 2, Dow Military Tasks shall include (i) assisting MCEL to develop the Military Prototype and (ii) assisting MCEL in its optimization of chemical systems within the Field of Use and Application for the production of hydrogen.

(d)    Dow Military Tasks - Milestone 3 . To the extent required by Section 5.1 above, from the date of achievement of the Military Objectives contained in Milestone 2 until the achievement of the Military Objectives contained in Milestone 3, Dow Military Tasks shall include (i) assisting MCEL in development of manufacturing plan for Military Product; (ii) assisting MCEL in its identification and discussions with potential licensees and suppliers of intellectual property, raw materials and products necessary or helpful for the manufacture of the production-ready Military Product and seek access thereto in anticipation of the Military P.O.; and (iii) assisting MCEL in its negotiating and entering into appropriate license agreements and supplier agreements with MCEL on mutually-satisfactory terms and/or assisting MCEL in its negotiation of appropriate license agreements and supplier agreements with third parties, if appropriate, in anticipation of Military P.O.; provided, that clauses (iii) of this Section 5.2(d) shall be subject to Section 9.2 .

(e)    Dow Military Tasks - Milestone 4 . To the extent required by Section 5.1 above, from the date of achievement of the Military Objectives contained in Milestone 3 until the achievement of the Military Objectives contained in Milestone 4, Dow Military Tasks shall include assisting MCEL in its establishing and utilizing manufacturing capabilities and distribution chain for Military Products.

(f)    Dow Consumer Tasks - Throughout Term . To the extent required by Section 5.1 above, throughout the Term, Dow Consumer Tasks shall include (i) attempting to use corporate contacts within potential OEMs to assist MCEL in its promotion of the Consumer Prototype and or the Consumer Product and (ii) assisting MCEL in the Consumer NaBH ₄ Approval Process.

(g)    Dow Consumer Tasks - Milestone 1 . To the extent required by Section 5.1 above, from the date hereof until the achievement of the Consumer Objectives contained in Milestone 1, Dow Consumer Tasks shall include (i) providing market research developed by Dow with respect to proposed technologies for Consumer Prototype, if any; and (ii) assisting MCEL in its meetings with OEMs to promote Dow’s plans and capabilities, if any, with respect to the Consumer Prototype.

(h)    Dow Consumer Tasks - Milestone 2 . To the extent required by Section 5.1 above, from the date of achievement of the Consumer Objectives contained in Milestone 1 until the achievement of the Consumer Objectives contained in Milestone 2, Dow Consumer Tasks shall include (i) providing Consumer Prototype technology evaluation capabilities to assist with technical due diligence thereof; and (ii) assisting MCEL in its identification of manufacturing and quality control assessment for the Consumer Prototype.

(i)    Dow Consumer Tasks - Milestone 3 . There are no Dow Consumer Tasks to be performed in connection with Milestone 3.

(j)    Dow Consumer Tasks - Milestone 4 . To the extent required by Section 5.1 above, from the date of achievement of the Consumer Objectives contained in Milestone 3 until the achievement of the Consumer Objectives contained in Milestone 4, Dow Consumer Tasks shall include (i) assisting MCEL to develop the Consumer Product; (ii) assisting MCEL in development of manufacturing plan for Consumer Product; (iii) assisting MCEL in its identification and discussions with potential licensees and suppliers of intellectual property, raw materials and products necessary or helpful for the manufacture of the Consumer Product and seek access thereto in anticipation of the Consumer P.O.; and (iv) assisting MCEL in its negotiating and entering into appropriate license agreements and supplier agreements with MCEL on mutually-satisfactory terms and/or assist MCEL in its negotiation of appropriate license agreements and supplier agreements with third parties, if appropriate, in anticipation of Consumer P.O.; provided, that clauses (iii) and (iv) of this Section 5.2(j) shall be subject to Section 9.2 .

6.1.    Compensation Per Milestone . Subject to the Stock Purchase Agreement and this Agreement:

(a)    First Closing . In exchange for entering into this Agreement, the Parties acknowledge and agree that MCEL has issued to Dow, and Dow has accepted, such number of shares of Series A-0 Preferred (as defined in the Stock Purchase Agreement) equal to a 3% Ownership Interest as part of the First Closing (as defined in the Stock Purchase Agreement);

(b)    Upon Achievement of Milestone 1 . Upon the achievement of Milestone 1 and in the event Dow elects to pay to MCEL at least the Minimum Series B Investment at the Second Closing (as defined in the Stock Purchase Agreement), MCEL shall issue to Dow, and Dow shall accept (subject to the terms of the Stock Purchase Agreement), such number of shares of Series A-1 Preferred (as defined in the Stock Purchase Agreement) that equal, when combined with such number of the Series B-1 Preferred (as defined in the Stock Purchase Agreement) and Warrants, if any, purchased by Dow at the Second Closing with the Minimum Series B Investment, a 4% Ownership Interest.

(d)    Upon Achievement of Milestone 2 . Upon the achievement of Milestone 2 and in the event Dow elects to pay to MCEL at least the Minimum Series B Investment at the Third Closing (as defined in the Stock Purchase Agreement), MCEL shall issue to Dow, and Dow shall accept (subject to the terms of the Stock Purchase Agreement), such number of shares of Series A-2 Preferred (as defined in the Stock Purchase Agreement) that equal, when combined with such number of the Series B-2 Preferred (as defined in the Stock Purchase Agreement) and Warrants, if any, purchased by Dow at the Third Closing with the Minimum Series B Investment, a 3% Ownership Interest.

(f)    Upon Achievement of Milestone 3 . Upon the achievement of Milestone 3 and in the event Dow elects to pay to MCEL at least the Minimum Series B Investment at the Fourth Closing (as defined in the Stock Purchase Agreement), MCEL shall issue to Dow, and Dow shall accept (subject to the terms of the Stock Purchase Agreement), such number of shares of Series A-3 Preferred (as defined in the Stock Purchase Agreement) that equal, when combined with such number of the Series B-3 Preferred (as defined in the Stock Purchase Agreement) and Warrants, if any, purchased by Dow at the Fourth Closing with the Minimum Series B Investment, a 5% Ownership Interest.

(g)    Upon Achievement of Milestone 4 . Upon the achievement of Milestone 4 and in the event Dow elects to pay to MCEL at least the Minimum Series B Investment at the Fifth Closing (as defined in the Stock Purchase Agreement), MCEL shall MCEL shall issue to Dow, and Dow shall accept (subject to the terms of the Stock Purchase Agreement), such number of shares of Series A-4 Preferred (as defined in the Stock Purchase Agreement) that equal, when combined with such number of the Series B-4 Preferred (as defined in the Stock Purchase Agreement) and Warrants, if any, purchased by Dow at the Fifth Closing with the Minimum Series B Investment, a 4.9% Ownership Interest.

(a)    Failure to Pay the Minimum Series B Investment . In the event Dow does not pay to MCEL at least the Minimum Series B Investment in connection with the achievement of any Milestone at the applicable Closing (as defined in the Stock Purchase Agreement) pursuant to the Stock Purchase Agreement, the shares of Series A Preferred Stock that MCEL is required to issue to Dow shall be subject to reduction pursuant to the terms of the Stock Purchase Agreement and Section 11.4(ii) of this Agreement shall apply.

(b)    Deferred Shares . Subject to the terms of the Stock Purchase Agreement, in the event that, in connection with the achievement of any Milestone, Dow elects (in its sole discretion) not to accept, in whole or in part, any Series A Preferred Stock that Dow is entitled to receive upon such Milestone (the “ Deferred Securities ”), MCEL shall hold such Deferred Securities in reserve for a period of up to twelve (12) months from the date of non-acceptance by Dow (the “ Deferral Period ”). Dow shall have the right, at any time and from time to time, during the Deferral Period to receive all or a portion of the Deferred Securities upon the same terms and conditions that Dow would have received the Deferred Securities at the time of original issuance.

(c)    Excess Shares . Subject to the terms of the Stock Purchase Agreement, if, at any time, an issuance of Series A Preferred Stock or Series B Preferred Stock (or shares of Common Stock issuable upon conversion thereof or upon the exercise of Warrants) would result in Dow holding greater than a 19.9% Ownership Interest in respect of Series A Preferred Stock, Series B Preferred Stock and Warrants acquired pursuant to the terms of the Stock Purchase Agreement, then the amount of Series A Preferred Stock or Series B Preferred Stock in excess of Dow’s 19.9% Ownership Interest (the “ Excess Shares ”) shall be held in reserve by MCEL. Dow shall have the right, at any time and from time to time, when Dow’s Ownership Interest is less than 19.9%, to receive or purchase such Excess Shares, in whole or in part, upon the same terms and conditions that Dow would have received or purchased such Excess Shares at the time of the initial offering of such Excess Shares.

(d)    No Additional Compensation . In the event that Dow makes available more FTEs than specified in Section 5.1 or provides services in addition to those described in Section 5.2 , Dow shall not be entitled to receive compensation pursuant to this Agreement that is in addition to the compensation described in Section 6.1 .

7.1.    General Representations and Warranties .

(a)    Corporate Power and Authorization . MCEL has all requisite legal and corporate power and authority to enter into this Agreement and perform its obligations in accordance with the terms of this Agreement. The execution and delivery of this Agreement by MCEL and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of MCEL and no further action is required by MCEL. This Agreement has been duly executed and delivered by MCEL and constitutes the valid and binding obligation of MCEL enforceable against MCEL in accordance with its respective terms except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and (b) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(b)    Filings, Consents and Approvals . MCEL is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by MCEL of this Agreement in accordance with its terms.

7.2.    MCEL’s Commitment . This Agreement is made with MCEL in reliance upon MCEL’s representation to Dow that MCEL is fully committed on the date of this Agreement to focusing primarily upon the development activities within the Field of Use and within the Application and the other obligations of MCEL contemplated by this Agreement. MCEL acknowledges that Dow is presently engaged in other business activities and may in the future be engaged in other business activities.

7.3.    MCEL-Contributed Intellectual Property .  Except as stated on Schedule 7.3 :

(a)    No MCEL-Contributed Intellectual Property or product or service of MCEL related to MCEL-Contributed Intellectual Property is subject to any proceeding or outstanding decree, order, judgment, agreement, contract or stipulation restricting in any manner the use, transfer or licensing thereof by MCEL, or which may affect the validity, use or enforceability of such MCEL-Contributed Intellectual Property. Each item of registered MCEL-Contributed Intellectual Property is presumed valid and subsisting. All necessary registration, maintenance and renewal fees currently due in connection with registered MCEL-Contributed Intellectual Property have been made and all necessary documents, recordations and certifications in connection with such registered MCEL-Contributed Intellectual Property have been filed with the relevant patent, copyright, trademark or other Government Authority for the purpose of maintaining such registered MCEL-Contributed Intellectual Property.

(b)    MCEL owns and has exclusive title to, or has licenses (sufficient for the conduct of the business of MCEL as currently conducted and as proposed to be conducted) to, each item of MCEL-Contributed Intellectual Property used in connection with the conduct of the business of MCEL as currently conducted and as proposed to be conducted free and clear of any lien, and MCEL is the exclusive owner or exclusive licensee of all trademarks and service marks, trade names and domain names used in connection with the operation or conduct of the business of MCEL, free and clear of all liens.

(c)    MCEL owns exclusively all copyrighted works that are MCEL products or which MCEL otherwise expressly purports to own, free and clear of all liens.

(d)    To the extent that any MCEL-Contributed Intellectual Property has been developed or created by a third party for MCEL, MCEL has a written agreement with such third party with respect thereto and MCEL thereby either (i) has obtained ownership of and is the exclusive owner of, or (ii) has obtained a license (sufficient for the conduct of the business of MCEL as currently conducted and as proposed to be conducted, including MCEL’s development activities contemplated hereby) to all of such third party’s MCEL-Contributed Intellectual Property in such work, material or invention by operation of law or by valid assignment.

(e)    All contracts relating to the MCEL-Contributed Intellectual Property are in full force and effect. The consummation of the transactions contemplated by this Agreement will neither violate nor result in a breach, modification, cancellation, termination or suspension of any of such contracts. MCEL is in compliance in all material respects with all such contracts and has not breached any material term of any such contract. To the knowledge of MCEL, all other parties to such contracts are in compliance in all respects with all such contracts and have not breached any term of any such contract.

(f)    To MCEL’s knowledge, the operation of the business of MCEL as it is currently conducted and as proposed to be conducted, including MCEL�