AMENDED AND RESTATED OEM SUPPLY AGREEMENT

Exhibit 10.7

Portions of this exhibit were omitted and filed separately with the Secretary of the Commission pursuant to an application for confidential treatment filed with the Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934. Such portions are marked by a series of asterisks.

AMENDED AND RESTATED OEM SUPPLY AGREEMENT

     THIS AMENDED AND RESTATED OEM SUPPLY AGREEMENT (the “Agreement”, “Amended and Restated Agreement”) is entered into and made effective as of September 21, 2007 (“Amended and Restated Agreement Effective Date”), amending and restating that certain OEM Supply Agreement made and entered into as of the 23rd day of September, 2004 (the “Original Effective Date”), by and between Philips Speech Recognition Systems GmbH f/k/a Philips Austria GmbH, Philips Speech Processing, a Republic of Austria corporation (hereinafter “PSP”), and MEDQUIST INC., a New Jersey, USA corporation (hereinafter “MedQuist”).

     MedQuist and PSP hereinafter also collectively referred to as the “Parties” and individually as a “Party”.

RECITALS

     WHEREAS, MedQuist and PSP entered into that certain OEM Supply Agreement (the “Original Agreement”) as of the Original Effective Date; and

     WHEREAS, the parties desire to amend and restate the Original Agreement as set forth herein.

     NOW THEREFORE, in consideration of the mutual agreements and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, it is mutually agreed and covenanted by and between the parties to this Amendment, as follows:

1. Definitions.

     1.1 [Intentionally Omitted]

     1.2 “Documentation” means user manuals, training materials, product descriptions, product specifications, technical manuals, license agreements, supporting materials, and like information related to the Products, which Documentation may be distributed in print, electronic, video, or other formats.

     1.3 “End User” means the means final retail purchasers or licensees at the sites where
the Products are installed.

     1.4 “Products” means, individually or collectively as appropriate, the Software, Documentation, developed products and hardware, supplies, accessories, and other commodities related to any of the foregoing, provided or to be provided by PSP pursuant to this Agreement, as described in Schedule B attached to this Agreement, as modified from time to time.

     1.5 “Affiliate” shall mean any corporation, limited liability company, partnership or other legal entity, present or future, which is owned or controlled or owns or controls or is under common control with, directly or indirectly, a Party to this Agreement, as the case may be, as long as such ownership or control exists and where control means ownership or control of more than fifty percent (50%) of voting stock in the case of a stock-issuing entity, or more than fifty percent (50%) of voting

control of a non-stock-issuing entity. For the purpose of this Agreement MedQuist and PSP shall not be deemed to be each others Affiliates.

     1.6 “Software” means certain computer programs and software (collectively, the “Programs”), which Programs may incorporate certain third-party software products provided or to be provided by PSP pursuant to this Agreement.

     1.7 “Source Code” means the underlying instructions for a computer written in programming languages, including all embedded comments, as well as procedural code such as job control language statements, in a form readable by human beings when displayed on a monitor or printed on paper, etc. and that must be translated (using off-the-shelf commercially available software compilers, linkers and assemblers or other items delivered with such code or reasonably available including documentation) into a form that is directly executable by a computer by a process generally known as compiling or assembly, along with any related documentation, including annotations, flow charts, schematics, statements of principles of operations, software summaries, software design, program logic, program listings, functional specifications, logical models and architecture standards, describing the data flows, data structures, and control logic of the software. For purposes of this Agreement, mere access to the Source Code in the PSP online controlled environment is not a sufficient provision or transfer of Source Code hereunder.

     1.8 “Intellectual Property Rights” shall mean any and all patents, utility certificates, utility models, industrial design rights, copyrights, database rights, trade secrets, any protection offered by law to information, semiconductor IC topography rights and all registrations, applications, renewals, extensions, combinations, divisions, continuations or reissues of any of the foregoing.

2. Grant of license.

     2.1 Subject to the terms of this Agreement and MedQuist’s rights under Sections 15 and 17, PSP hereby grants to MedQuist, and MedQuist hereby accepts from PSP, an exclusive, perpetual and non-transferable license to offer for sale, sublicense, sell, deliver and service the Products, and to authorize others to offer for sale, sublicense, sell, deliver, and service the Products, directly and through one or more tiers of distributors, dealers, and resellers (collectively, the “Dealers”), within the territory set forth on Schedule A to this Agreement (“Territory”); provided that such rights are nonefxclusive for the specified nonexclusive Territory on Schedule A.

     2.2 PSP reserves all rights related to the Products that PSP does not expressly grant MedQuist in this Agreement. Outside MedQuist’s exclusive Territory, PSP may offer for sale, sell, deliver, and service the Products, and may authorize others to offer for sale, sell, deliver, and service the Products, without providing any rights or compensation to MedQuist. During and after the Term, inside MedQuist’s exclusive Territory, PSP and any Affiliate: (i) may not offer for sale, sell, deliver or service the Products; or (ii) authorize others to offer for sale, sell, deliver, or service the Products.

          2.2.1 [Intentionally Omitted]

          2.2.2 [Intentionally Omitted]

          2.2.3 [Intentionally Omitted]

     2.3 MedQuist is authorized to appoint Dealers within the Territory defined in Schedule A to offer for sale, sell, deliver, and service the Products at its discretion and without approval from PSP. MedQuist will give PSP written notice of the identity of any Dealer that MedQuist intends to appoint in the non-exclusive Territory. MedQuist will ensure that all Dealers appointed by MedQuist are sufficiently trained and competent to sell and support the Product in their respective territories.

3. Initial Term and Renewal.

     3.1 Initial Term. This Agreement will be deemed to have commenced on June 1, 2004, and had an initial term that ended on June 30, 2007 (“Initial Term”). Pursuant to the renewal terms set forth below in Section 3.2, the term was extended through June 30, 2010 for the first Renewal Term (of the two possible Renewal Terms), and is subject to termination as set forth in this Agreement.

     3.2 Renewal. Subject to Philips’ right to terminate below, this Agreement will automatically renew for two (2) additional three (3) year terms (each such renewal term being referred to in this Agreement as a “Renewal Term,” and together with the Initial Term referenced above in Section 3.1 as the “Term”), provided that MedQuist is, at the end of the Initial Term or the first Renewal Term, in material compliance with this Agreement. If PSP decides to discontinue all business relating to the Products in the Territory on or after June 30, 2010, PSP can effect such discontinuation by terminating this Agreement by providing Medquist six (6) months prior written notice of such discontinuation (by way of clarification, the earliest such discontinuation can therefore occur is at the end of the first Renewal Term (June 30, 2010), and therefore the notice of termination from PSP for such date would have to be provided to MedQuist by January 1, 2010). Otherwise, this Agreement will automatically expire at the end of the second Renewal Term (June 30, 2013).

          3.2.1 [Intentionally Omitted]

          3.2.2 [Intentionally Omitted]

     4.1 Product Co-Ownership Fee. In consideration of PSP’s grant of co-ownership of the Products in accordance with the terms of this Agreement, MedQuist will pay PSP a Product co-ownership fee in cash in the amount of ******* (the “Product Co-Ownership Fee”), as follows: 100% on the date PSP delivers a duly-executed original of this Amended and Restated Agreement and a copy of the Source Code of the Products to MedQuist.

     4.2 License Fee. During the Term, MedQuist will pay PSP sums owed for the License Fees set forth on Schedule C to this Agreement, on a calendar monthly basis, within ******* from the end of each such calendar month. The foregoing does not alter the reporting requirement of Section 6.2. For License Fees set forth on Schedule C to this Agreement and software maintenance fees set forth in Section 4.3 reported in calendar year 2006, the Parties agree that these License Fees and software maintenance fees only become due after MedQuist reports in writing to PSP that these Product installations have been successfully implemented at the MedQuist customer sites. For calendar year 2007 and thereafter, the Parties agree to jointly annually review the payment terms if the implementation phase at the MedQuist customer sites, as determined by MedQuist, can on average be reduced from currently ******* (as of the Amended and Restated Agreement Effective Date) to ******* or less. In that case the payment terms set forth in this Section will be reduced from ******* or any agreed upon shorter period

required for the average implementation.

     4.3 Software Maintenance Fee.

          4.3.1 During the Term, MedQuist will use reasonable commercial efforts to sell its End Users a software maintenance agreement (an “SMA”). Such SMA will provide that the subscribing End User will obtain, directly from PSP or from PSP through MedQuist or directly from MedQuist, as MedQuist deems appropriate:

               4.3.1.1 Software Releases. As used in this Agreement, “Software Release” means a new version of the Products delivered to MedQuist for internal or external user testing or commercial availability. Software Releases are typically numbered sequentially (e.g., Release 4.x, Release 6.x).

               4.3.1.2 Patch Releases. As used in this Agreement, “Patch Release” means a change PSP makes to a Software Release, which is an internal change designed to correct minor anomalies or defects in the Software (colloquially referred to as “bugs”), or otherwise to provide minor improvements to performance without changing the Software’s basic design, structure, or functionality. Patch Releases are typically numbered to signify modifications to a version of Software Release (e.g., Version 4.1.05, Version 4.1.06).

               4.3.1.3 Point Releases. As used in this Agreement, “Point Release” means a modification or enhancement (colloquially referred to as an “upgrade”) to a Software Release that: (i) enables the Software Release to perform new or different functions; (ii) increases the capability of the Software; or (iii) enables the Software to function on new or different hardware or in a new or different software environment without changing its basic design, structure or functionality. Point Releases are typically numbered as versions of a Software Release (e.g., Version 4.1, Version 4.2, etc.).

               4.3.1.4 Technical Support to resolve technical issues that are more practicably resolved by PSP (as to PSP supported Products) than by MedQuist.

          4.3.2 SMA contracts MedQuist sells will begin at the end of PSP’s Warranty Period (as set forth in Section 8.1 of this Agreement) and will be renewable on an annual basis. In the event that MedQuist allows an End User to terminate or cancel an SMA before the end of the term of such SMA, MedQuist will provide notice of such termination to PSP, and PSP will refund to MedQuist the pro-rata portion of fees paid to PSP for such SMA within thirty (30) days after MedQuist provides such notice.

          4.3.3 For each SMA contract that MedQuist sells, it will pay PSP the following sums within ******* after the reporting date for the Software licenses are due per Section 6.2.:

               4.3.3.1 For sums owed for the period beginning with the Original Effective Date of this Agreement through June 30, 2006: ******* of the License Fee set forth on Schedule C to this Agreement.

               4.3.3.2 For sums owed for the period beginning July 1, 2006, through the remainder of the Initial Term and all Renewal Terms of this Agreement: ******* of the License Fee set forth on Schedule C to this Agreement.

          4.3.4 All sums owed set forth in Section 4.3.3 of this Agreement: (i) will he

calculated based on the License Fee and without regard to any discounts available to MedQuist; and (ii) will be amortized on a straight-line basis for each month over the term of the SMA.

          4.3.5 PSP will maintain the current code base of the Products until the earlier of: (i) *******; or (ii) MedQuist terminates the PSP maintenance and support obligations hereunder via thirty (30) days advance written notice to PSP. The PSP maintenance includes supporting MedQuist integrations of the Products to PACS, RIS and HIS vendors existing as of September 30, 2007. If the actual costs of PSP for maintaining the Products (the “Maintenance Costs”) during the period commencing on ******* and ending on ******* (the “Maintenance Period”) are higher than the Software maintenance fees to be paid to PSP during that period, then PSP shall be entitled to request a reasonable increase of the maintenance fees; provided, however , that in connection with such request, PSP will provide to MedQuist all necessary supporting cost documentation and will permit MedQuist representatives to audit such information upon reasonable advance notice from MedQuist; provided further, that PSP shall provide MedQuist with (i) a good faith estimate of the Maintenance Costs incurred by PSP during each calendar month within the Maintenance Period (each month a “Reporting Month”) no later than ten (10) days following the last day of such Reporting Month, and (ii) a report detailing the actual Maintenance Costs incurred by PSP during each Reporting Month no later than twenty-five (25) days following the last day of such Reporting Month.

     4.4 Additional Development Fees: MedQuist agrees to fund the development of a version 1.2 “Lite” of the Software in 2007 as specified in NEW SCHEDULE A-1 (SOW) to this Agreement. The “Additional Development Fee” to be paid by MedQuist to PSP for such development is dependent upon the actual hours spent and the prices per hour as itemized in NEW SCHEDULE B-1 to this Agreement. The current estimated Additional Development Fee is based on an estimate of ******* on average per month, starting from July 2007 until December 31, 2007; provided, however that PSP and MedQuist agree to a “not to exceed” cap on the Additional Development Fee of *******. Any changes to the specifications in NEW SCHEDULE A-1 (SOW) are subject to mutual agreement and may have influences on the required development work and/or may require an increase or reduction to the “not to exceed” cap. The product and program management of version 1.2 “Lite” will be a collaborative effort between PSP and MedQuist. In addition, because of the version 1.2 “Lite” timeline (as further described in Section 7), the SOW includes a supplemental role for MedQuist in additional quality assurance testing of this version of the Software. PSP will provide MedQuist a monthly detailed accounting, within thirty (30) days of the end of each calendar month, of the monthly hours and an agreed rate will be set as described in NEW SCHEDULE B-1.

     4.5 Additional Consulting Services. During the Term, for matters not related to version 1.2 “Lite” but involving MedQuist development related to the Philips SpeechMagic SDK, PSP will provide to MedQuist, upon MedQuist’s request from time to time, and at no additional charge to MedQuist, additional consulting/development/training services worth an aggregate of ******* (using the rates set forth in NEW SCHEDULE B-1) (“Additional Consulting Services”). The Additional Consulting Services will be tracked using the same process as the development hours set forth in Section 4.4 above. Any additional consulting services to be provided by PSP beyond the Additional Consulting Services specified in this Section, shall be subject to the mutual agreement of PSP and MedQuist.

5. Order Placement.

     5.1 Upon MedQuist’s request, PSP will provide MedQuist with the Products as described in this Agreement, including without limitation the accompanying Schedules.

     5.2 PSP will deliver to MedQuist a “gold master” of the then-current version of the Software: (i) within seven (7) days after the execution and delivery of this Amended and Restated

Agreement by both parties to this Agreement; and (ii) promptly on the commercial availability of each Software Release. Software MedQuist distributes under this Agreement will be copies of the gold master PSP most recently furnished to MedQuist pursuant to this Agreement or, as determined by MedQuist, such other subsequent versions created by MedQuist following the transfer set forth in Section 15.

6. Payment.

     6.1 MedQuist will pay such sums owed free and clear of, and without offset or deduction for, any and all state and local use, sales, property, and similar taxes, levied or assessed on or in respect of such payments (other than any tax measured by or attributable to MedQuist’s gross or net income), as and when the same are due.

     6.2 By thirty (30) days after the end of each calendar month, MedQuist will furnish to PSP a written statement showing, in such detail as PSP may reasonably request, the quantities of Software actually licensed, and the quantities of Products actually sold and delivered, during the immediately-preceding month.

     6.3 MedQuist will, throughout the Term of this Agreement and for one (1) year following the expiration or termination of this Agreement, maintain a full and accurate record of the number of copies of the Software sublicensed in such detail as may enable PSP to verify the amount of license fees due under this Agreement. So as to permit verification, MedQuist will permit PSP to examine such records on reasonable advance written notice, during normal business hours at MedQuist’s offices at reasonable intervals no more frequently than two (2) times per calendar year. PSP will bear all costs and expenses for such an examination, except in those cases in which the examining accountant ascertains a discrepancy of more than five percent (5%) during the audited period to the disadvantage of PSP between payments actually made and payments due, in which event MedQuist will reimburse PSP all reasonable costs and expenses for such audit.

     6.4 PSP reserves the right to charge an interest rate of the lesser of: (i) eight percent (8%) per annum; or (ii) the maximum amount permitted by applicable law, on past-due sums MedQuist owes under this Agreement.

     6.5 Payment of the Additional Development Fees outlined in 4.4 above will be due within thirty (30) days from the date of the invoice.

7. Development Services.

     7.1 PSP will deliver a beta ready version of version 1.2 “Lite” Software to MedQuist for internal and external user testing on or before *******, including a full copy of the Source Code thereto (“Beta Deliverable”). PSP will deliver a commercial version 1.2 “Lite” Software to MedQuist on or before *******, including a full copy of the Source Code thereto (“Commercial Deliverable”). This will enable MedQuist to showcase a new version of the Software at the annual ******* and make the version commercially available by no later than *******.

     7.2 Acceptance Process. “Deliverable” shall mean the Beta Deliverable or the Commercial Deliverable as applicable. MedQuist will notify PSP within 30 days after its receipt of the applicable Deliverable from PSP whether or not the Deliverable meets the applicable Acceptance criteria (“Acceptance Process”). If MedQuist determines that the Deliverable does not meet the applicable Acceptance criteria, MedQuist will notify PSP in writing of the non-conformities and/or Severity 1

Defects, and PSP shall correct such non-conformities and/or Severity 1 Defects and then re-deliver the revised Deliverable to MedQuist as promptly as practicable (but in no later than thirty (30) days from the date MedQuist notifies PSP of the non-conformities and/or Severity 1 Defects). Upon such re-delivery, the Acceptance Process shall repeat until MedQuist has affirmatively notified PSP in writing that the Deliverable meets the applicable Acceptance criteria or thirty (30) days from such re-delivery have passed with no notification from MedQuist of any non-conformities and/or Severity 1 Defects in such Deliverable.

     7.3 Acceptance Delays. To the extent that Acceptance of a Deliverable is delayed, for reasons solely attributable to PSP, beyond the original scheduled Acceptance date (for the Beta Deliverable: November 30, 2007; for the Commercial Deliverable: January 30, 2008), PSP shall pay to MedQuist ******* of delay until such Deliverable meets Acceptance (“Acceptance Delay Payments”). MedQuist may, at MedQuist’s option, in lieu of cash payments from PSP for the Acceptance Delay Payments, offset such amounts from any other payment amounts or obligations due from MedQuist to PSP.

     7.4 Acceptance Definitions.

			“Acceptance” means the Products conform to the agreed product specification and feature content detailed in the Statement of Work in Schedule A and no mutually agreed to, new or subsequent Severity 1 Defect(s) have been identified in such Products during the acceptance testing.
			“Severity 1 Defect(s)” means a software defect that causes loss of critical functionality, or corruption or loss of data without possibility of recovery for which no work around exists. A work around that may exist will not alter the requirement that the Product meet the product specification and feature content detailed in the Statement of Work in Schedule A.

8. Limited Warranty.

     8.1 PSP warrants that, for a period of ninety (90) days after the delivery date (the “Warranty Period”), the Software will perform in all material respects in accordance with the Documentation accompanying the Software. If any copy of the Software is found not to perform materially in accordance with the Documentation, PSP will correct such error or malfunction or (at PSP’s sole option) replace such Software free of charge as soon as is reasonably practicable, provided that: (i) the Software has been used in accordance with instructions for use; (ii) no alteration, modification or addition has been made to the Software without PSP’s prior written consent; and (iii) PSP has been promptly notified of the alleged non-conformity within the Warranty Period specified.

     8.2 MedQuist will send each claim of MedQuist under this warranty to PSP in accordance with the notice provisions of this Agreement. Each such claim will state generally the nature of the alleged non-conformity. If PSP determines in its sole discretion to repair the Software (or such portion of it as is giving rise to the non-conformity), MedQuist will afford PSP a reasonable time in which to do so. Any Software so repaired or replaced will be warranted for such period of time as is remaining in the original Warranty Period.

     8.3 This Limited Warranty is subject to the terms of Section 12 below. This Limited Warranty is PSP’s only obligations and the exclusive remedy of the End User with respect to the PSP supported Products and PSP’s only warranty with respect to the Products to the End User. PSP will have no responsibility whatsoever with respect to the Products if the failure is due to accident, abuse, or misapplication on the part of MedQuist or the End User.

     8.4 MedQuist may offer any warranty that PSP makes hereunder to any End Users provided that warranty claims by MedQuist’s End Users will be made solely against MedQuist and not PSP. The warranties contained in this Agreement are solely for the benefit of MedQuist.

9. Notification of Upgrades and Updates.

     9.1 PSP will notify MedQuist of any revisions and updates to the Software with respect to the development, maintenance and other PSP services provided hereunder that affect the operation, performance, or cost of such Software.

     9.2 MedQuist will apply any revisions or updates to the PSP supported Software as soon as reasonably practicable after receipt of notification from PSP.

10. MedQuist’s Representations and Undertakings. MedQuist represents and undertakes with PSP that:

     10.1 It will use commercially reasonable efforts to promote, market, and sell the Products during the term of this Agreement;

     10.2 It has the resources, facilities, and financial ability to market, distribute and provide first line customer support for the Product and fulfill all of its obligations under this Agreement;

     10.3 [Intentionally Omitted]

     10.4 It will not incur any liability on behalf of PSP, pledge or purport to pledge PSP’s credit, or purport to act as an agent of PSP or make any contract binding on PSP;

     10.5 [Intentionally Omitted]

     10.6 It will permit PSP or any independent third party PSP retains to enter MedQuist’s premises at a time MedQuist agrees to for the purpose of reviewing records related to this Agreement (including, without limitation, verifying the number of Software sublicenses granted by or through MedQuist and obtaining information concerning any Product complaints);

     10.7 [Intentionally Omitted]

     10.8 Third party software, as defined in Schedule E to this Agreement (the “Third Party Software”), that is provided by PSP to MedQuist and distributed with the Software will not be used in conjunction with any other programs or software whatsoever;

     10.9 It will obtain and maintain at its sole risk, cost, and expense, all governmental approvals required for or applicable to its distribution and other activities contemplated by this Agreement, and will be responsible at its sole risk, cost, and expense for complying with all applicable governmental statues, regulations, and ordinances (collectively, the “Laws”) related to such activities; and

     10.10 It will, before the delivery of the Products to an End User, ensure that such End

User enters into a software license agreement with MedQuist that will accompany each copy of the Software in substantially the form set forth on Schedule F to this Agreement or such other end user license agreement as determined by MedQuist from time to time (the “End User License Agreement”). MedQuist will, from time to time, provide PSP with a copy of any such updates to MedQuist’s standard End User License Agreement as such applies to the PSP supported Products.

11. PSP’s Obligations. PSP covenants, warrants, and agrees that it:

     11.1 Has the necessary approvals and licenses to grant to MedQuist the co-ownership, right to use, sublicense, and distribute the Software in accordance with the terms of this Agreement.

     11.2 Has the resources, facilities, and financial ability to develop and provide second line
support for the Products and to fulfill all of its obligations under this Agreement.

     11.3 Will provide initial 2 days of training in the use of the Products to technical staff of MedQuist at no additional charge, at the place agreed on by both parties. PSP and MedQuist will mutually limit the number of personnel participating in training sessions. On MedQuist’s request, PSP will provide a similar training program for all upgrades to the Software. Each first technical training for a new version will be done free of charge; for any subsequent training, PSP and MedQuist will agree on a reasonable price.

     11.4 Will at all times during the Term of this Agreement and where applicable, following
termination hereof, observe and perform the terms and conditions set out in this Agreement.

     11.5 [Intentionally Omitted]

     11.6 Will not, during the Term of this Agreement, develop, create or release a front-end multi-user reporting solution (including but not limited to the Products or any solution substantially similar thereto) into the medical market in North America (as defined in Schedule B) nor, directly authorize, direct, assist or otherwise facilitate any of its Affiliates to do so.; however, for avoidance of doubt, nothing stated in this clause shall prohibit PSP’s Affiliates from integrating SpeechMagic within their general medical application products.

12. Exclusion Of Warranties. EXCEPT AS EXPRESSLY SET FORTH IN SECTION 8 OF THIS AGREEMENT, PSP MAKES NO WARRANTIES, EXPRESS, IMPLIED, OR STATUTORY, WHATSOEVER, AS TO THE PRODUCTS AND THE DOCUMENTATION. PSP EXPRESSLY DISCLAIMS, ANY AND ALL WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSES, ACCURACY, SATISFACTORY QUALITY, NON-INFRINGEMENT, COURSE OF DEALING, OR COURSE OF PERFORMANCE.

13. Limited Liability. IN NO EVENT WILL EITHER PARTY OR ANY OF ITS AFFILIATES, SUBSIDIARIES, OR LICENSORS BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL, MULTIPLIED, ENHANCED, OR PUNITIVE DAMAGES, INCLUDING, WITHOUT LIMITATION, LOSS OF REVENUE, PROFITS, OR GOODWILL, BUSINESS INTERRUPTION, OR LOST IN CONNECTION WITH THIS AGREEMENT OR THE PRODUCT, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT PRODUCT LIABILITY, OR OTHERWISE, EVEN IF SUCH PARTY, ITS AFFILIATES, ITS SUBSIDIARIES, OR ITS LICENSORS HAVE BEEN ADVISED OF

THE POSSIBILITY OF SUCH DAMAGES AND EVEN IF ANY LIMITED REMEDY SPECIFIED IN THIS AGREEMENT IS DEEMED TO HAVE FAILED ITS ESSENTIAL PURPOSE. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF LIABILITY FOR CONSEQUENTIAL OR INCIDENTAL DAMAGES, SO THIS LIMITATION MAY NOT APPLY IN THOSE JURISDICTIONS. IF ANY CLAIM IS MADE AGAINST A PARTY, INCLUDING WITHOUT LIMITATION CLAIMS AS A RESULT OF THE SUBSTANTIAL NONCONFORMANCE OF THE SOFTWARE TO THE DOCUMENTATION OR OTHERWISE, THE PARTY’S TOTAL LIABILITY FOR DAMAGES WILL BE LIMITED, IN THE AGGREGATE, TO ITS ACTUAL DIRECT DAMAGES, AND IN ANY EVENT WILL NOT EXCEED THE TOTAL OF ALL AMOUNTS MEDQUIST IS OBLIGATED TO PAY PSP UNDER THIS AGREEMENT. SOME JURISDICTIONS MAY NOT ALLOW LIMITATIONS OF LIABILITY FOR CERTAIN TYPES OF DAMAGE OR CERTAIN CLAIMS, SO SUCH LIMITATION MAY NOT APPLY IN SUCH JURISDICTION.

14. Intellectual Property Indemnification. PSP will indemnify, defend, and hold harmless MedQuist, and MedQuist’s directors, officers, shareholders, employees, agents, and attorneys, and MedQuist’s affiliates and their directors, officers, shareholders, partners, members, employees, agents, and attorneys, and the End Users, and the successor, and assigns of any or all of them, from all third-party Claims for infringement, misappropriation or violation of copyrights, trademarks, trade secrets, or other proprietary rights associated with any portion of the Product, or any other material delivered under this Agreement; provided that: (i) MedQuist promptly notifies PSP in writing of the Claim; (ii) PSP has sole control of the defense and all related settlement negotiations with respect to the Claim; provided however, that MedQuist has the right, but not the obligation, to participate in the defense of any such Claim through counsel of its own choosing (at MedQuist’s sole expense), which right will not detract from PSP’s sole right to control such defense; and (iii) MedQuist cooperates fully to the extent reasonably necessary, and executes all documents reasonably necessary for the defense of such Claim. “Claim” will mean all loss, losses, liabilities, damage, damages, claims, taxes, and all related costs and expenses; including, without limitation, reasonable attorneys’ fees and costs of investigation, litigation, settlement, judgment, interest, and penalties. If MedQuist provides PSP with notice of a Claim, MedQuist may withhold any further payments due to PSP pursuant to this Agreement, and deposit the same in an interest-bearing escrow account with a commercial bank. On the resolution of a