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SHARE EXCHANGE AGREEMENT

THIS AGREEMENT is made effective as of the 28th day of January, 2008

AMONG:

> > COUNTERPATH CORPORATION, a Nevada corporation, of Suite 300, One Bentall
> > Centre, 505 Burrard Street, Vancouver, British Columbia, Canada V7X 1M3
> > 
> > (“Pubco”)

AND:

> > FIRSTHAND TECHNOLOGIES INC., an Ontario corporation, of Suite 300, 350 Terry
> > Fox Drive, Ottawa, Ontario, Canada K2K 2P5
> > 
> > (“Priveco”)

AND:

> > THE UNDERSIGNED SHAREHOLDERS OF PRIVECO
> > 
> > (the “Selling Shareholders”)

WHEREAS:

A.                      The Selling Shareholders are registered and/or
beneficial owners of shares in the capital of Priveco;

B.                       Pubco has made an offer that provides for the purchase
of all (but not less than all) of the then outstanding shares of Priveco from
the shareholders of Priveco in exchange for common shares of Pubco; and

C.                       Upon the terms and subject to the conditions set forth
in this Agreement the Selling Shareholders have agreed to sell all of the issued
and outstanding common shares of Priveco held by the Selling Shareholders to
Pubco in exchange for common shares of Pubco.

THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration (the receipt and sufficiency
of which are hereby acknowledged), the parties covenant and agree as follows:

1.                       DEFINITIONS

1.1                     Definitions. The following terms have the following
meanings, unless the context indicates otherwise:

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  (a)

“Agreement” shall mean this Agreement, and all the exhibits, schedules and other
documents attached to or referred to in this Agreement, and all amendments and
supplements, if any, to this Agreement;

        (b)

“Canadian GAAP” shall mean Canadian generally accepted accounting principles
applied in a manner consistent with prior periods;

        (c)

“Closing” shall mean the completion of the Transaction, in accordance with
Section 7 hereof, at which the Closing Documents shall be exchanged by the
parties, except for those documents or other items specifically required to be
exchanged at a later time;

        (d)

“Closing Date” shall mean a date mutually agreed upon by the parties hereto in
writing and in accordance with Section 10.6 following the satisfaction or waiver
by Pubco and Priveco of the conditions precedent set out in Sections 5.1 and 5.2
respectively;

        (e)

“Closing Documents” shall mean the papers, instruments and documents required to
be executed and delivered at the Closing pursuant to this Agreement;

        (f)

“Exchange Act” shall mean the United States Securities Exchange Act of 1934, as
amended;

        (g)

“FINRA” shall mean the Financial Industry Regulatory Authority;

        (h)

“GAAP” shall mean United States generally accepted accounting principles applied
in a manner consistent with prior periods;

        (i)

“Liabilities” shall include any direct or indirect indebtedness, guaranty,
endorsement, claim, loss, damage, deficiency, cost, expense, obligation or
responsibility, fixed or unfixed, known or unknown, asserted choate or inchoate,
liquidated or unliquidated, secured or unsecured;

        (j)

“Material Adverse Effect” when used in connection with an entity means any
change (including a decision to implement such a change made by the board of
directors or by senior management who believe that confirmation of the decision
by the board of directors is probable), event, violation, inaccuracy,
circumstance or effect that is materially adverse to the business, assets
(including intangible assets), liabilities, capitalization, ownership, financial
condition or results of operations of such entity or subsidiaries taken as a
whole;

        (k)

“Option Holders” shall mean, collectively, the holders of Priveco Options and
“Option Holder” shall mean any one of them;

        (l)

“Person” shall mean any individual, partnership, firm, corporation, limited
liability company, association, trust, unincorporated organization or other
entity;

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  (m)

“Priveco Options” shall mean the outstanding options to purchase 1,395,632
common shares of Priveco, being all of the outstanding and unexercised options
of Priveco;

        (n)

“Priveco Security Holders” shall mean, collectively, the holders of Priveco
Shares and Priveco Options, and “Priveco Security Holder” shall mean any one of
them;

        (o)

“Priveco Shareholders” shall mean, collectively, the holders of Priveco Shares
and “Priveco Shareholder” shall mean any one of them;

        (p)

“Priveco Shares” shall mean, collectively, all of the issued and outstanding
common shares of Priveco, class A voting preferred shares of Priveco, class B
voting preferred shares of Priveco, class C voting preferred shares of Priveco
and class D voting preferred shares of Priveco;

        (q)

“Pubco Options” shall mean the 1,395,632 options of Pubco, to be issued to the
Retained Option Holders by Pubco on the Closing Date, in the form substantially
as set out in Schedule 5;

        (r)

“Pubco Securities” means, collectively, the Pubco Shares and Pubco Options;

        (s)

“Pubco Shares” shall mean the 29,500,000 fully paid and non-assessable common
shares of Pubco, to be issued to the Priveco Shareholders by Pubco on the
Closing Date;

        (t)

“Retained Option Holders” shall mean, collectively, those Option Holders that
are retained as employees of Priveco or Pubco following the Closing and
“Retained Option Holder” shall mean any one of them;

        (u)

“SEC” shall mean the Securities and Exchange Commission;

        (v)

“Securities Act” shall mean the United States Securities Act of 1933, as
amended;

        (w)

“Shareholder Agreement” shall mean the Second Amended and Restated Unanimous
Shareholders Agreement of Priveco dated May 23, 2006 among Priveco and the
shareholders of Priveco from time to time;

        (x)

“Taxes” shall include international, federal, state, provincial and local income
taxes, capital gains tax, value-added taxes, franchise, personal property and
real property taxes, levies, assessments, tariffs, duties (including any customs
duty), business license or other fees, sales, use and any other taxes relating
to the assets of the designated party or the business of the designated party
for all periods up to and including the Closing Date, together with any related
charge or amount, including interest, fines, penalties and additions to tax, if
any, arising out of tax assessments; and

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  (y)

“Transaction” shall mean the: (i) purchase of the Priveco Shares by Pubco from
the Priveco Shareholders in consideration for the issuance of the Pubco Shares;
and (ii) exchange of the Priveco Options held by the Retained Option Holders for
the Pubco Options.

1.2                     Schedules. The following schedules are attached to and
form part of this Agreement:

  Schedule 1 – Priveco Shareholders   Schedule 2A – Certificate of Non-U.S.
Shareholder   Schedule 2B – Certificate of U.S. Shareholder   Schedule 3 –
Directors and Officers of Priveco   Schedule 4 – Directors and Officers of Pubco
  Schedule 5 – Form of Pubco Option   Schedule 6 – Piggyback Registration Rights

1.3                     Currency. All references to currency referred to in this
Agreement are in United States Dollars (US$), unless expressly stated otherwise.

1.4                     Definition of Knowledge. In this Agreement:

  (a)

an individual will be deemed to have “knowledge” of a particular fact or matter
if:

          (i)

such individual is actually aware of such fact or matter, or

          (ii)

a prudent individual could be expected to discover or otherwise become aware of
such fact or matter in the course of conducting a reasonably comprehensive
investigation concerning the existence of such fact or matter, and

          (b)

a Person other than an individual will be deemed to have “knowledge” of a
particular fact or matter if any individual who is serving as a senior officer
of such Person (or in any similar capacity) has, or at any time had, knowledge
of such fact or matter.

2.                       THE OFFER, PURCHASE AND SALE OF SHARES

2.1                     Offer, Purchase and Sale of Shares. Subject to the terms
and conditions of this Agreement, Pubco hereby irrevocably offers to acquire all
of the issued and outstanding Priveco Shares and the Selling Shareholders hereby
covenant and irrevocably agree to sell, assign and transfer to Pubco, and Pubco
hereby irrevocably covenants and agrees to purchase from the Selling
Shareholders, all of the Priveco Shares held by the Selling Shareholders. After
the date hereof, Pubco will deliver a notice concurrently to all Priveco
Shareholders, other than the Selling Shareholders (the “Remaining Priveco
Shareholders”), and to Priveco notifying them of (i) Pubco’s offer to acquire
all of the issued and outstanding Priveco Shares, (ii) the names of all Priveco
Shareholders that have accepted such offer and the number of Priveco Shares in
respect of which such Priveco Shareholders have accepted the offer, (iii) the
expected Closing Date, and (iv) that the Remaining Priveco Shareholders are
required to tender their Priveco

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Shares to Pubco in accordance with the drag along rights set forth in Section
4.8 of the Shareholder Agreement (the “Drag Along Notice”). Pubco will include a
letter of transmittal with the Drag Along Notice to provide each Remaining
Priveco Shareholder with a process for submitting the certificates representing
the Priveco Shares held by such shareholder (the “Letter of Transmittal”).

2.2                     Consideration. As consideration for the Priveco Shares
to be acquired by Pubco pursuant to the terms of this Agreement, Pubco shall
allot and issue the Pubco Shares (only 29,500,000 shares of common stock and no
more) to the Priveco Shareholders in the amount set out opposite each Priveco
Shareholder’s name in Schedule 1, provided that after giving effect to the
foregoing in respect of all Priveco Shares any fractional interest in a Pubco
Share to be received by any Priveco Shareholder shall be rounded up to the
nearest whole Pubco Share. The Pubco Shares are being issued pursuant to an
exemption from the prospectus and registration requirements of the Securities
Act. As required by applicable securities law, the Selling Shareholders agree to
abide by all applicable resale restrictions and hold periods imposed by all
applicable securities legislation. Each Letter of Transmittal will contain a
similar commitment on the part of all Remaining Priveco Shareholders. All
certificates representing the Pubco Shares issued on Closing will be endorsed
with one of the following legends pursuant to the Securities Act in order to
reflect the fact that the Pubco Shares will be issued to the Priveco
Shareholders, pursuant to an exemption from the registration requirements of the
Securities Act:

For the Priveco Shareholders not resident in the United States:

> > “THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE
> > TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN)
> > PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
> > AMENDED (THE “1933 ACT”).
> > 
> > NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE
> > 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY
> > NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS
> > DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS
> > OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
> > STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR
> > IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933
> > ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
> > LAWS. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER
> > THE 1933 ACT.”

For Priveco Shareholders resident in the United States:

> > “NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE
> > UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY
> > U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR
> > SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO
> > U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF

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> > REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
> > STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR
> > IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933
> > ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
> > LAWS. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER
> > THE 1933 ACT.”

2.3                     Exchange Procedure. Each Priveco Shareholder may
exchange his, her or its certificate representing the Priveco Shares by
delivering such certificate to Pubco duly executed and endorsed in blank (or
accompanied by duly executed stock powers duly endorsed in blank), in each case
in proper form for transfer, and, if applicable, with all stock transfer and any
other required documentary stamps affixed thereto and with appropriate
instructions to allow the transfer agent to issue certificates for the Pubco
Shares to the holder thereof (or as the holder may otherwise direct) together
with:

  (a)

if the Priveco Shareholder is not resident in the United States, a Certificate
of Non-U.S. Shareholder (the “Regulation S Certificate”), a copy of which is set
out in Schedule 2A; and

        (b)

if the Priveco Shareholder is resident in the United States, a Certificate of
U.S. Shareholder (the “Rule 506 Certificate”), a copy of which is set out in
Schedule 2B.

Pubco will ensure that the Letter of Transmittal distributed to the Remaining
Priveco Shareholders will be in a form and be accompanied by the appropriate
documentation to satisfy the foregoing requirements.

2.3A                   Option Holders. In connection with the Closing of the
Transaction, the Retained Option Holders will be granted Pubco Options on the
basis of one (1) Pubco Option for each one (1) Priveco Option held by each such
Retained Option Holder. The board of directors of Priveco will exercise its
authority under Priveco’s stock option plan to (i) provide for the exchange of
the Priveco Options held by each Retained Option Holder into such Pubco Options
and (ii) accelerate the vesting of all Priveco Options held by Option Holders
other than Retained Option Holders and provide that any such options of Priveco
which remain unexercised as of the time of Closing shall expire. Pubco may
require each Retained Option Holder to execute Pubco’s standard form of
agreement evidencing the Pubco Options and:

  (a)

if the Retained Option Holder is not resident in the United States, a Regulation
S Certificate; and

        (b)

if the Retained Option Holder is resident in the United States, a Rule 506
Certificate.

2.4                     Reserved.

2.5                     Closing Date. The Closing will take place, subject to
the terms and conditions of this Agreement, on the Closing Date.

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2.6                     Restricted Securities. The Pubco Securities issued
pursuant to the terms and conditions set forth in this Agreement will have such
hold periods as are required under applicable securities laws and as a result
may not be sold, transferred or otherwise disposed, except pursuant to an
effective registration statement under the Securities Act, or pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and in each case only in accordance with all
applicable securities laws.

2.7                     Piggy-back Registration Rights. Pubco agrees that the
Pubco Shares issued pursuant to this Agreement will have the registration rights
set out in Schedule 6. The Letter of Transmittal delivered to all Remaining
Priveco Shareholders shall contain an agreement to this effect from Pubco.

2.8                     Exemptions. Pubco is relying upon an exemption from the
prospectus and registration requirements of applicable Canadian securities laws
(the “Canadian Securities Laws”) and, as a consequence, certain protections,
rights and remedies provided by the Canadian Securities Laws, including
statutory rights of rescission or damages, will not be available to the Priveco
Security Holders.

2.9                     Canadian Resale Restrictions. Pubco is not currently a
reporting issuer in any province or territory of Canada. However, Pubco hereby
represents and warrants to the Selling Shareholders that it has applied for a
listing of its common shares on the TSX Venture Exchange (the “TSXV”) and that
it will use its commercially reasonable best efforts to obtain such listing as
soon as practicable following execution of this Agreement. In the event that the
common shares are not listed on the TSXV and Pubco does not otherwise become a
reporting issuer in any province or territory of Canada, any applicable hold
periods under the Canadian Securities Laws or any other Canadian jurisdiction
may never expire, and the Pubco Securities may be subject to resale restrictions
in Canada for an indefinite period of time. Additionally, resale of any of the
Pubco Securities by the Priveco Security Holders resident in Canada is
restricted except pursuant to an exemption from applicable securities
legislation.

3.                       REPRESENTATIONS AND WARRANTIES OF PRIVECO

As of the Closing, Priveco represents and warrants to Pubco, and acknowledges
that Pubco is relying upon such representations and warranties, in connection
with the execution, delivery and performance of this Agreement, notwithstanding
any investigation made by or on behalf of Pubco, as follows:

3.1                     Organization and Good Standing. Priveco is a corporation
duly organized, validly existing and in good standing under the laws of the
Province of Ontario and has the requisite corporate power and authority to own,
lease and to carry on its business as now being conducted. Priveco is duly
qualified to do business and is in good standing as a foreign corporation in
each of the jurisdictions in which Priveco owns property, leases property, does
business, or is otherwise required to do so, except where the failure to be so
qualified would not have a Material Adverse Effect on Priveco.

3.2                     Authority. Priveco has all requisite corporate power and
authority to execute and deliver this Agreement and any other document
contemplated by this Agreement (collectively,

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the “Priveco Documents”) to be signed by Priveco and to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The execution
and delivery of each of the Priveco Documents by Priveco and the consummation of
the transactions contemplated hereby have been duly authorized by Priveco’s
board of directors. No other corporate or shareholder proceedings on the part of
Priveco is necessary to authorize such documents or to consummate the
transactions contemplated hereby. This Agreement has been, and the other Priveco
Documents when executed and delivered by Priveco as contemplated by this
Agreement will be, duly executed and delivered by Priveco and this Agreement is,
and the other Priveco Documents when executed and delivered by Priveco as
contemplated hereby will be, valid and binding obligations of Priveco
enforceable in accordance with their respective terms except:

  (a)

as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting enforcement of creditors’ rights
generally;

        (b)

as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies; and

        (c)

as limited by public policy.

3.3                     Capitalization of Priveco. The entire authorized capital
stock and other equity securities of Priveco consists of: (i) an unlimited
number of common shares (the “Priveco Common Stock”); (ii) an unlimited number
of class A voting preferred shares (the “Priveco Class A Stock”); (iii) an
unlimited number of class B voting preferred shares (the “Priveco Class B
Stock”); an unlimited number of class C voting preferred shares (the “Priveco
Class C Stock”); and (iv) an unlimited number of class D voting preferred shares
(the “Priveco Class D Stock”). As of the date of this Agreement, there are: (i)
1,302,567 shares of Priveco Common Stock issued and outstanding; (ii) 4,164,552
shares of Priveco Class A Stock issued and outstanding; (iii) 4,490,968 shares
of Priveco Class B Stock issued and outstanding; (iv) 6,114,243 shares of
Priveco Class C Stock issued and outstanding; (iv) no shares of Priveco Class D
Stock issued and outstanding; and (v) 3,040,148 Priveco Options outstanding and
unexercised. Prior to Closing, approximately 5,816,917 shares of Priveco Class D
Stock will be issued to the Selling Shareholders, which Priveco Class D Stock
will be sold to Pubco on and pursuant to the terms of this Agreement. Schedule 1
assumes that such shares of Priveco Class D Stock are issued and outstanding.
All of the issued and outstanding shares of Priveco have been duly authorized,
are validly issued, were not issued in violation of any pre-emptive rights and
are fully paid and non-assessable, are not subject to pre-emptive rights and
were issued in full compliance with the laws of the Province of Ontario and its
Articles of Incorporation. Except as previously disclosed to Pubco and the
Priveco Class A Stock, Priveco Class B Stock, Priveco Class C Stock, Priveco
Class D Stock and the Priveco Options, there are no outstanding options,
warrants, subscriptions, conversion rights, or other rights, agreements, or
commitments obligating Priveco to issue any additional common shares of Priveco
Common Stock, or any other securities convertible into, exchangeable for, or
evidencing the right to subscribe for or acquire from Priveco any common shares
of Priveco Common Stock. Other than the Shareholders Agreement, there are no
agreements purporting to restrict the transfer of any of the issued and
outstanding shares of Priveco, no voting agreements, shareholders’ agreements,
voting trusts, or other arrangements

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restricting or affecting the voting of any of the shares of Priveco to which
Priveco is a party or of which Priveco is aware.

3.4                     Capitalization of Priveco. At Closing, to the best
knowledge of Priveco, the issued and outstanding Priveco Shares and outstanding
and unexercised Priveco Options, respectively, will be as follows:

  (i)

Schedule 1 contains a true and complete list of the holders of all issued and
outstanding Priveco Shares, including each holder’s name, class and number of
Priveco Shares held, assuming the issuance of the Priveco Class D Stock to be
issued between the date hereof and Closing as described in Section 3.3, and

        (ii)

Priveco has provided Pubco with a document containing a true and complete list
of the Option Holders and all of the outstanding and unexercised Priveco
Options, including each Option Holder’s name, address and number of Priveco
Options held.

3.5                     Directors and Officers of Priveco. The duly elected or
appointed directors and the duly appointed officers of Priveco are as set out in
Schedule 3.

3.6                     Corporate Records of Priveco. The corporate records of
Priveco, as required to be maintained by it pursuant to the laws of the Province
of Ontario, are accurate, complete and current in all material respects, and the
minute book of Priveco is, in all material respects, correct and contains all
material records required by the laws of the Province of Ontario, in regards to
all proceedings, consents, actions and meetings of the shareholders and the
board of directors of Priveco.

3.7                     Non-Contravention. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the Transaction, will:

  (a)

conflict with, result in a violation of, cause a default under (with or without
notice, lapse of time or both) or give rise to a right of termination,
amendment, cancellation or acceleration of any obligation contained in or the
loss of any material benefit under, or result in the creation of any lien,
security interest, charge or encumbrance upon any of the material properties or
assets of Priveco or any of its subsidiaries under any term, condition or
provision of any loan or credit agreement, note, debenture, bond, mortgage,
indenture, lease or other agreement, instrument, permit, license, judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to Priveco
or any of its subsidiaries, or any of their respective material property or
assets;

        (b)

violate any provision of the Articles of Incorporation of Priveco, any of its
subsidiaries or any applicable laws; or

        (c)

violate any order, writ, injunction, decree, statute, rule, or regulation of any
court or governmental or regulatory authority applicable to Priveco, any of its
subsidiaries or any of their respective material property or assets.

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3.8                     Actions and Proceedings. To the best knowledge of
Priveco, there is no basis for and there is no action, suit, judgment, claim,
demand or proceeding outstanding or pending, or, to the best knowledge of
Priveco, threatened against or affecting Priveco or which involves any of the
business, or the properties or assets of Priveco that, if adversely resolved or
determined, would have a Material Adverse Effect on Priveco. There is no
reasonable basis for any claim or action that, based upon the likelihood of its
being asserted and its success if asserted, would have a Material Adverse Effect
on Priveco.

3.9                     Compliance.

  (a)

To the best knowledge of Priveco, Priveco is in compliance with, is not in
default or violation in any material respect under, and has not been charged
with or received any notice at any time of any material violation of any
statute, law, ordinance, regulation, rule, decree or other applicable regulation
to the business or operations of Priveco;

        (b)

To the best knowledge of Priveco, Priveco is not subject to any judgment, order
or decree entered in any lawsuit or proceeding applicable to its business and
operations that would have a Material Adverse Effect on Priveco;

        (c)

Priveco has duly filed all reports and returns required to be filed by it with
governmental authorities and has obtained all governmental permits and other
governmental consents, except as may be required after the execution of this
Agreement or where the failure to do so would not have a Material Adverse Effect
on Priveco. All of such permits and consents are in full force and effect, and
no proceedings for the suspension or cancellation of any of them, and no
investigation relating to any of them, is pending or to the best knowledge of
Priveco, threatened, and none of them will be affected in a material adverse
manner by the consummation of the Transaction; and

        (d)

Priveco has operated in material compliance with all laws, rules, statutes,
ordinances, orders and regulations applicable to its business. Priveco has not
received any notice of any violation thereof, nor is Priveco aware of any valid
basis therefore.

3.10                   Filings, Consents and Approvals. No filing or
registration with, no notice to and no permit, authorization, consent, or
approval of any public or governmental body or authority or other Person is
necessary for the consummation by Priveco of the Transaction contemplated by
this Agreement.

3.11                   Financial Representations. The consolidated audited
balance sheets for Priveco for its last two fiscal years plus any consolidated
unaudited balance sheets for Priveco dated on or before December 31, 2007 (the
“Priveco Accounting Date”), together with related statements of income, cash
flows, and changes in shareholder’s equity for such fiscal years and interim
period then ended (collectively, the “Priveco Financial Statements”) to be
supplied on or before the Closing Date:

  (a)

are in accordance with the books and records of Priveco;

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  (b)

present fairly the financial condition of Priveco as of the respective dates
indicated and the results of operations for such periods; and

        (c)

have been prepared in accordance with Canadian GAAP.

Priveco has not received any advice or notification from its independent
certified public accountants that Priveco has used any improper accounting
practice that would have the effect of not reflecting or incorrectly reflecting
in the Priveco Financial Statements or the books and records of Priveco, any
properties, assets, Liabilities, revenues, or expenses. The books, records, and
accounts of Priveco accurately and fairly reflect, in reasonable detail, the
assets, and Liabilities of Priveco. Priveco has not engaged in any transaction,
maintained any bank account, or used any funds of Priveco, except for
transactions, bank accounts, and funds which have been and are reflected in the
normally maintained books and records of Priveco.

3.12                   Absence of Undisclosed Liabilities. Other than the costs
and expenses incurred in connection with the negotiation and consummation of the
Transaction, including Liabilities and obligations in respect of the termination
of the employment of those Priveco employees set out in writing to Pubco on or
prior to Closing (the “Terminated Employees”), Priveco does not have any
material Liabilities or obligations either direct or indirect, matured or
unmatured, absolute, contingent or otherwise that exceed $15,000, which:

  (a)

are not set forth in the Priveco Financial Statements or have not heretofore
been paid or discharged;

        (b)

did not arise in the regular and ordinary course of business under any
agreement, contract, commitment, lease or plan specifically disclosed in writing
to Pubco; or

        (c)

have not been incurred in amounts and pursuant to practices consistent with past
business practice, in or as a result of the regular and ordinary course of its
business since the date of the last Priveco Financial Statements.

3.13                   Tax Matters.

  (a)

As of the date hereof:

          (i)

Priveco has timely filed all tax returns in connection with any Taxes which are
required to be filed on or prior to the date hereof, taking into account any
extensions of the filing deadlines which have been validly granted to Priveco,
and

          (ii)

all such returns are true and correct in all material respects;

          (b)

Priveco has paid all Taxes that have become or are due with respect to any
period ended on or prior to the date hereof, and has established an adequate
reserve therefore on its balance sheets for those Taxes not yet due and payable,
except for any Taxes the non-payment of which will not have a Material Adverse
Effect on Priveco;

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  (c)

to the best knowledge of Priveco, Priveco is not presently under or has not
received notice of, any contemplated investigation or audit by regulatory or
governmental agency of body or any foreign or state taxing authority concerning
any fiscal year or period ended prior to the date hereof;

        (d)

all Taxes required to be withheld on or prior to the date hereof from employees
for income Taxes, social security Taxes, unemployment Taxes and other similar
withholding Taxes have been properly withheld and, if required on or prior to
the date hereof, have been deposited with the appropriate governmental agency;
and

        (e)

to the best knowledge of Priveco, the Priveco Financial Statements contain full
provision for all Taxes including any deferred Taxes that may be assessed to
Priveco for the accounting period ended on the Priveco Accounting Date or for
any prior period in respect of any transaction, event or omission occurring, or
any profit earned, on or prior to the Priveco Accounting Date or for any profit
earned by Priveco on or prior to the Priveco Accounting Date or for which
Priveco is accountable up to such date and all contingent Liabilities for Taxes
have been provided for or disclosed in the Priveco Financial Statements.

3.14                   Absence of Changes. Except as previously disclosed to
Pubco, since the Priveco Accounting Date, Priveco has not:

  (a)

incurred any Liabilities, other than Liabilities incurred in the ordinary course
of business consistent with past practice and costs and expenses incurred in
connection with the negotiation and consummation of the Transaction, including
Liabilities and obligations in respect of the termination of the employment of
the Terminated Employees, or discharged or satisfied any lien or encumbrance, or
paid any Liabilities, other than in the ordinary course of business consistent
with past practice, or failed to pay or discharge when due any Liabilities of
which the failure to pay or discharge has caused or will cause any material
damage or risk of material loss to it or any of its assets or properties;

        (b)

sold, encumbered, assigned or transferred any material fixed assets or
properties except for ordinary course business transactions consistent with past
practice;

        (c)

created, incurred, assumed or guaranteed any indebtedness for money borrowed, or
mortgaged, pledged or subjected any of the material assets or properties of
Priveco or its subsidiaries to any mortgage, lien, pledge, security interest,
conditional sales contract or other encumbrance of any nature whatsoever;

        (d)

made or suffered any amendment or termination of any material agreement,
contract, commitment, lease or plan to which it is a party or by which it is
bound, or cancelled, modified or waived any substantial debts or claims held by
it or waived any rights of substantial value, other than in the ordinary course
of business;

        (e)

declared, set aside or paid any dividend or made or agreed to make any other
distribution or payment in respect of its capital shares or redeemed, purchased
or

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otherwise acquired or agreed to redeem, purchase or acquire any of its capital
shares or equity securities;

        (f)

suffered any damage, destruction or loss, whether or not covered by insurance,
that has had or may be reasonably expected to have a Material Adverse Change on
Priveco;

        (g)

received notice or had knowledge of any actual or threatened labor trouble,
termination, resignation, strike or other occurrence, event or condition of any
similar character which has had or might have a Material Adverse Effect on
Priveco;

        (h)

made commitments or agreements for capital expenditures or capital additions or
betterments exceeding in the aggregate $15,000;

        (i)

other than in the ordinary course of business, increased the salaries or other
compensation of, or made any advance (excluding advances for ordinary and
necessary business expenses) or loan to, any of its employees or directors or
made any increase in, or any addition to, other benefits to which any of its
employees or directors may be entitled;

        (j)

entered into any transaction other than in the ordinary course of business
consistent with past practice or as contemplated by this Agreement; or

        (k)

agreed, whether in writing or orally, to do any of the foregoing.

3.15                   Absence of Certain Changes or Events. Since the Priveco
Accounting Date, there has not been:

  (a)

a Material Adverse Effect with respect to Priveco; or

        (b)

any material change by Priveco in its accounting methods, principles or
practices.

3.16                   Subsidiaries. Except for Firsthand Technologies, Corp., a
Delaware corporation, Priveco does not have any subsidiaries or agreements of
any nature to acquire any subsidiary or to acquire or lease any other business
operations.

3.17                   Personal Property. Priveco possesses, and has good and
marketable title of all property necessary for the continued operation of the
business of Priveco as presently conducted and as represented to Pubco. All such
property is used in the business of Priveco. All such property is in reasonably
good operating condition (normal wear and tear excepted), and is reasonably fit
for the purposes for which such property is presently used. All material
equipment, furniture, fixtures and other tangible personal property and assets
owned or leased by Priveco is owned by Priveco free and clear of all liens,
security interests, charges, encumbrances, and other adverse claims, except as
previously disclosed to Pubco.

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3.18                   Intellectual Property

  (a)

Intellectual Property Assets. Priveco owns or holds an interest in all
intellectual property assets necessary for the operation of the business of
Priveco as it is currently conducted (collectively, the “Intellectual Property
Assets”), including:

          (i)

all functional business names, trading names, registered and unregistered
trademarks, service marks, and applications (collectively, the “Marks”);

          (ii)

all patents, patent applications, and inventions, methods, processes and
discoveries that may be patentable (collectively, the “Patents”);

          (iii)

all copyrights in both published works and unpublished works (collectively, the
“Copyrights”); and

          (iv)

all know-how, trade secrets, confidential information, customer lists, software,
technical information, data, process technology, plans, drawings, and blue
prints owned, used, or licensed by Priveco as licensee or licensor
(collectively, the “Trade Secrets”).

          (b)

Agreements. Priveco has previously provided Pubco with a complete and accurate
list of all material contracts and agreements relating to the Intellectual
Property Assets to which Priveco is a party or by which Priveco is bound, except
for any license implied by the sale of a product and perpetual, paid-up licenses
for commonly available software programs with a value of less than $15,000 under
which Priveco is the licensee (the “Priveco Intellectual Property List”). To the
best knowledge of Priveco, there are no outstanding or threatened disputes or
disagreements with respect to any such agreement.

          (c)

Intellectual Property and Know-How Necessary for the Business. Except as
previously provided in the Priveco Intellectual Property List, Priveco is the
owner of all right, title, and interest in and to each of the Intellectual
Property Assets, free and clear of all liens, security interests, charges,
encumbrances, and other adverse claims, and has the right to use without payment
to a third party of all the Intellectual Property Assets. Except as provided in
the Priveco Intellectual Property List, all former and current employees and
contractors of Priveco have executed written contracts, agreements or other
undertakings with Priveco that assign all rights to any inventions,
improvements, discoveries, or information relating to the business of Priveco.
No employee, director, officer or shareholder of Priveco owns directly or
indirectly in whole or in part, any Intellectual Property Asset which Priveco is
presently using or which is necessary for the conduct of its business. To the
best knowledge of Priveco, no employee or contractor of Priveco has entered into
any contract or agreement that restricts or limits in any way the scope or type
of work in which the employee may be engaged or requires the employee to
transfer, assign, or disclose information concerning his work to anyone other
than Priveco.

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  (d)

Patents. Except as previously provided in the Priveco Intellectual Property
List, Priveco does not hold any right, title or interest in and to any Patent
and Priveco has not filed any patent application with any third party. To the
best knowledge of Priveco, none of the products manufactured and sold, nor any
process or know- how used, by Priveco infringes or is alleged to infringe any
patent or other proprietary night of any other Person.

        (e)

Trademarks. Except as previously provided in the Priveco Intellectual Property
List, Priveco does not hold any right, title or interest in and to any Mark and
Priveco has not registered or filed any application to register any Mark with
any third party. To the best knowledge of Priveco, none of the Marks, if any,
used by Priveco infringes or is alleged to infringe any trade name, trademark,
or service mark of any third party.

        (f)

Copyrights. Priveco is the owner of all right, title, and interest in and to
each of the Copyrights, free and clear of all liens, security interests,
charges, encumbrances, and other adverse claims. If applicable, all registered
Copyrights are currently in compliance with formal legal requirements, are valid
and enforceable, and are not subject to any maintenance fees or taxes or actions
falling due within ninety days after the Closing Date. To the best knowledge of
Priveco, no Copyright is infringed or has been challenged or threatened in any
way and none of the subject matter of any of the Copyrights infringes or is
alleged to infringe any copyright of any third party or is a derivative work
based on the work of a third party. All works encompassed by the Copyrights have
been marked with the proper copyright notice.

        (g)

Trade Secrets. Priveco has taken all reasonable precautions to protect the
secrecy, confidentiality, and value of its Trade Secrets. Priveco has good title
and an absolute right to use the Trade Secrets. The Trade Secrets are not part
of the public knowledge or literature, and to the best knowledge of Priveco,
have not been used, divulged, or appropriated either for the benefit of any
Person or to the detriment of Priveco. No Trade Secret is subject to any adverse
claim or has been challenged or threatened in any way.

3.19                   Insurance. The products sold by and the assets owned by
Priveco are insured under various policies of general product liability and
other forms of insurance consistent with prudent business practices. All such
policies are in full force and effect in accordance with their terms, no notice
of cancellation has been received, and there is no existing default by Priveco,
or any event which, with the giving of notice, the lapse of time or both, would
constitute a default thereunder. All premiums to date have been paid in full.

3.20                   Employees and Consultants. All employees and consultants
of Priveco have been paid all salaries, wages, income and any other sum due and
owing to them by Priveco, as at the end of the most recent completed pay period
except for accrued but unpaid vacation pay. Priveco is not aware of any labor
conflict with any employees that might reasonably be expected to have a Material
Adverse Effect on Priveco. To the best knowledge of Priveco, no employee of
Priveco is in violation of any term of any employment contract, non-disclosure
agreement,

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- 16 -

non-competition agreement or any other contract or agreement relating to the
relationship of such employee with Priveco or any other nature of the business
conducted or to be conducted by Priveco.

3.21                   Real Property. Priveco does not own any real property.
Each of the leases, subleases, claims or other real property interests
(collectively, the “Leases”) to which Priveco is a party or is bound, as
previously disclosed to Pubco, is legal, valid, binding enforceable and in full
force and effect in all material respects. All rental and other payments
required to be paid by Priveco pursuant to any such Leases have been duly paid
and no event has occurred which, upon the passing of time, the giving of notice,
or both, would constitute a breach or default by any party under any of the
Leases. The Leases will continue to be legal, valid, binding, enforceable and in
full force and effect on identical terms following the Closing Date. Priveco has
not assigned, transferred, conveyed, mortgaged, deeded in trust, or encumbered
any interest in the Leases or the leasehold property pursuant thereto.

3.22                   Material Contracts and Transactions. Priveco has
previously made available to Pubco each contract, agreement, license, permit,
arrangement, commitment or instrument to which Priveco is a party and which is
material to the conduct of the business of Priveco (each, a “Contract”). Each
Contract is in full force and effect, and there exists no material breach or
violation of or default by Priveco under any Contract, or any event that with
notice or the lapse of time, or both, will create a material breach or violation
thereof or default under any Contract by Priveco. To the best knowledge of
Priveco, the continuation, validity, and effectiveness of each Contract will in
no way be affected by the consummation of the Transaction contemplated by this
Agreement. There exists no actual or threatened termination, cancellation, or
limitation of, or any amendment, modification, or change to any Contract.

3.23                   Certain Transactions. Priveco is not a guarantor or
indemnitor of any indebtedness of any Person.

3.24                   No Brokers. Priveco has not incurred any independent
obligation or liability to any party for any brokerage fees, agent’s
commissions, or finder’s fees in connection with the Transaction contemplated by
this Agreement.

3.25                   Completeness of Disclosure. No representation or warranty
by Priveco in this Agreement nor any certificate, schedule, statement, document
or instrument furnished or to be furnished to Pubco pursuant hereto contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact required to be stated herein or therein or necessary to
make any statement herein or therein not materially misleading.

4.                       REPRESENTATIONS AND WARRANTIES OF PUBCO

As of the Closing, Pubco represents and warrants to Priveco and the Priveco
Shareholders and acknowledges that Priveco and the Priveco Shareholders are
relying upon such representations and warranties in connection with the
execution, delivery and performance of this Agreement, notwithstanding any
investigation made by or on behalf of Priveco or the Selling Shareholders, as
follows:

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- 17 -

4.1                     Organization and Good Standing. Pubco is duly
incorporated, organized, validly existing and in good standing under the laws of
the State of Nevada and has all requisite corporate power and authority to own,
lease and to carry on its business as now being conducted. Pubco is qualified to
do business and is in good standing as a foreign corporation in each of the
jurisdictions in which it owns property, leases property, does business, or is
otherwise required to do so, where the failure to be so qualified would have a
Material Adverse Effect on Pubco.

4.2                     Authority. Pubco has all requisite corporate power and
authority to execute and deliver this Agreement and any other document
contemplated by this Agreement (collectively, the “Pubco Documents”) to be
signed by Pubco and to perform its obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery of each of the
Pubco Documents by Pubco and the consummation by Pubco of the transactions
contemplated hereby have been duly authorized by its board of directors and no
other corporate or shareholder proceedings on the part of Pubco is necessary to
authorize such documents or to consummate the transactions contemplated hereby.
This Agreement has been, and the other Pubco Documents when executed and
delivered by Pubco as contemplated by this Agreement will be, duly executed and
delivered by Pubco and this Agreement is, and the other Pubco Documents when
executed and delivered by Pubco, as contemplated hereby will be, valid and
binding obligations of Pubco enforceable in accordance with their respective
terms, except:

  (a)

as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting enforcement of creditors’ rights
generally;

        (b)

as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies; and

        (c)

as limited by public policy.

4.3                     Capitalization of Pubco. The entire authorized capital
stock and other equity securities of Pubco consists of: (i) 415,384,500 shares
of common stock with a par value of $0.001 (the “Pubco Common Stock”); (ii)
100,000,000 shares of preferred stock with a par value of $0.001 (the “Pubco
Preferred Stock”); (iii) options to purchase 19,000,000 shares of Pubco Common
Stock; and (iv) warrants to purchase 5,000,000 shares of Pubco Common Stock (the
“Pubco Warrants”). As of the date of this Agreement, there are: (i) 95,108,887
shares of Pubco Common Stock issued and outstanding; (ii) one share of Pubco
Preferred Stock, designated as a Series A Special Voting Share issued and
outstanding; (iii) options to purchase 18,248,674 shares of Pubco Common Stock
outstanding and unexercised; and (iv) warrants to purchase 5,000,000 shares of
Pubco Common Stock outstanding and unexercised. In addition, there are 1,849,180
preferred shares of 6789722 Canada Inc., a subsidiary of Pubco, which are
exchangeable into 1,849,180 common shares of Pubco. All of the issued and
outstanding shares of Pubco Common Stock and Pubco Preferred Stock have been
duly authorized, are validly issued, were not issued in violation of any
pre-emptive rights and are fully paid and non-assessable, are not subject to
pre-emptive rights and were issued in full compliance with all federal, state,
and local laws, rules and regulations. Except for the Pubco Common Stock, Pubco
Preferred Stock, options to purchase Pubco Common Stock, Pubco Warrants and
exchangeable preferred shares of 6789722 Canada Inc. referred to above, there
are no outstanding options,

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- 18 -

warrants, subscriptions, conversion rights, or other rights, agreements, or
commitments obligating Pubco to issue any additional shares of Pubco Common
Stock, or any other securities convertible into, exchangeable for, or evidencing
the right to subscribe for or acquire from Pubco any shares of Pubco Common
Stock. There are no agreements purporting to restrict the transfer of any of the
issued and outstanding shares of Pubco, no voting agreements, shareholders’
agreements, voting trusts, or other arrangements restricting or affecting the
voting of any of the shares of Pubco to which Pubco is a party or of which Pubco
is aware.

4.4                     Directors and Officers of Pubco. The duly elected or
appointed directors and the duly appointed officers of Pubco are as listed on
Schedule 4.

4.5                     Corporate Records of Pubco. The corporate records of
Pubco, as required to be maintained by it pursuant to the laws of the State of
Nevada, are accurate, complete and current in all material respects, and the
minute book of Pubco is, in all material respects, correct and contains all
material records required by the law of the State of Nevada in regards to all
proceedings, consents, actions and meetings of the shareholders and the board of
directors of Pubco.

4.6                     Non-Contravention. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the Transaction, will:

  (a)

conflict with, result in a violation of, cause a default under (with or without
notice, lapse of time or both) or give rise to a right of termination,
amendment, cancellation or acceleration of any obligation contained in or the
loss of any material benefit under, or result in the creation of any lien,
security interest, charge or encumbrance upon any of the material properties or
assets of Pubco or any of its subsidiaries under any term, condition or
provision of any loan or credit agreement, note, debenture, bond, mortgage,
indenture, lease or other agreement, instrument, permit, license, judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to Pubco
or any of its subsidiaries or any of their respective material property or
assets;

        (b)

violate any provision of the applicable incorporation or charter documents of
Pubco, any of its subsidiaries or any applicable laws; or

        (c)

violate any order, writ, injunction, decree, statute, rule, or regulation of any
court or governmental or regulatory authority applicable to Pubco, any of its
subsidiaries or any of their respective material property or assets.

4.7                     Validity of Pubco Common Stock Issuable upon the
Transaction. The Pubco Shares to be issued to the Selling Shareholders upon
consummation of the Transaction in accordance with this Agreement will, upon
issuance, have been duly and validly authorized and, when so issued in
accordance with the terms of this Agreement, will be duly and validly issued,
fully paid and non-assessable.

4.8                     Actions and Proceedings. Except as disclosed in the
Pubco SEC Documents (hereinafter defined), to the best knowledge of Pubco, there
is no basis for and there is no claim, charge, arbitration, grievance, action,
suit, judgment, demand, investigation or proceeding by or

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- 19 -

before any court, arbiter, administrative agency or other governmental authority
now outstanding or pending or, to the best knowledge of Pubco, threatened
against or affecting Pubco which involves any of the business, or the properties
or assets of Pubco that, if adversely resolved or determined, would have a
Material Adverse Effect on Pubco. There is no reasonable basis for any claim or
action that, based upon the likelihood of its being asserted and its success if
asserted, would have a Material Adverse Effect on Pubco.

4.9                     Compliance.

  (a)

To the best knowledge of Pubco, Pubco is in compliance with, is not in default
or violation in any material respect under, and has not been charged with or
received any notice at any time of any material violation of any statute, law,
ordinance, regulation, rule, decree or other applicable regulation to the
business or operations of Pubco;

        (b)

To the best knowledge of Pubco, Pubco is not subject to any judgment, order or
decree entered in any lawsuit or proceeding applicable to its business and
operations that would have a Material Adverse Effect on Pubco;

        (c)

Pubco has duly filed all reports and returns required to be filed by it with
governmental authorities and has obtained all governmental permits and other
governmental consents, except as may be required after the execution of this
Agreement. All of such permits and consents are in full force and effect, and no
proceedings for the suspension or cancellation of any of them, and no
investigation relating to any of them, is pending or to the best knowledge of
Pubco, threatened, and none of them will be affected in a material adverse
manner by the consummation of the Transaction; and

        (d)

Pubco has operated in material compliance with all laws, rules, statutes,
ordinances, orders and regulations applicable to its business. Pubco has not
received any notice of any violation thereof, nor is Pubco aware of any valid
basis therefore.

4.10                   Filings, Consents and Approvals. No filing or
registration with, no notice to and no permit, authorization, consent, or
approval of any public or governmental body or authority or other Person is
necessary for the consummation by Pubco of the Transaction contemplated by this
Agreement to continue to conduct its business after the Closing Date in a manner
which is consistent with that in which it is presently conducted.

4.11                   SEC Filings. Pubco is a registrant and reporting company
under the Exchange Act. Pubco has furnished or made available to Priveco and the
Selling Shareholders a true and complete copy of each report, schedule,
registration statement and proxy statement filed by Pubco with the SEC
(collectively, and as such documents have since the time of their filing been
amended, the “Pubco SEC Documents”). As of their respective dates, the Pubco SEC
Documents complied in all material respects with the requirements of the
Securities Act, or the Exchange Act, as the case may be, and the rules and
regulations of the SEC thereunder applicable to such Pubco SEC Documents. The
Pubco SEC Documents constitute all of the

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- 20 -

documents and reports that Pubco was required to file with the SEC pursuant to
the Exchange Act and the rules and regulations promulgated thereunder by the
SEC.

4.12                   Financial Representations. Included with the Pubco SEC
Documents are true, correct, and complete copies of audited balance sheets for
Pubco dated as of April 30, 2007 and unaudited balance sheets for Pubco dated as
of October 31, 2007 (the “Pubco Accounting Date”), together with related
statements of income, cash flows, and changes in shareholder’s equity for the
fiscal year and interim period then ended (collectively, the “Pubco Financial
Statements”). The Pubco Financial Statements:

  (a)

are in accordance with the books and records of Pubco;

        (b)

present fairly the financial condition of Pubco as of the respective dates
indicated and the results of operations for such periods; and

        (c)

have been prepared in accordance with GAAP.

Pubco has not received any advice or notification from its independent certified
public accountants that Pubco has used any improper accounting practice that
would have the effect of not reflecting or incorrectly reflecting in the Pubco
Financial Statements or the books and records of Pubco, any properties, assets,
Liabilities, revenues, or expenses. The books, records, and accounts of Pubco
accurately and fairly reflect, in reasonable detail, the assets, and Liabilities
of Pubco. Pubco has not engaged in any transaction, maintained any bank account,
or used any funds of Pubco, except for transactions, bank accounts, and funds
which have been and are reflected in the normally maintained books and records
of Pubco.

4.13                   Absence of Undisclosed Liabilities. Pubco has no material
Liabilities or obligations either direct or indirect, matured or unmatured,
absolute, contingent or otherwise, which:

  (a)

are not set forth in the Pubco Financial Statements or have not heretofore been
paid or discharged;

        (b)

did not arise in the regular and ordinary course of business under any
agreement, contract, commitment, lease or plan specifically disclosed in writing
to Priveco; or

        (c)

have not been incurred in amounts and pursuant to practices consistent with past
business practice, in or as a result of the regular and ordinary course of its
business since the date of the last Pubco Financial Statements.

4.14                   Tax Matters.

  (a)

As of the date hereof:

          (i)

except as previously disclosed to Priveco, Pubco has timely filed all tax
returns in connection with any Taxes which are required to be filed on or

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- 21 -

 

prior to the date hereof, taking into account any extensions of the filing
deadlines which have been validly granted to them, and

        (ii)

all such returns are true and correct in all material respects;

  (b)

Pubco has paid all Taxes that have become or are due with respect to any period
ended on or prior to the date hereof and has established an adequate reserve
therefore on its balance sheets for those Taxes not yet due and payable, except
for any Taxes the non-payment of which will not have a Material Adverse Effect
on Pubco;

        (c)

Pubco is not presently under and has not received notice of, any contemplated
investigation or audit by any regulatory or government agency or body or any
foreign or state taxing authority concerning any fiscal year or period ended
prior to the date hereof;

        (d)

All Taxes required to be withheld on or prior to the date hereof from employees
for income Taxes, social security Taxes, unemployment Taxes and other similar
withholding Taxes have been properly withheld and, if required on or prior to
the date hereof, have been deposited with the appropriate governmental agency;
and

        (e)

To the best knowledge of Pubco, the Pubco Financial Statements contain full
provision for all Taxes including any deferred Taxes that may be assessed to
Pubco for the accounting period ended on the Pubco Accounting Date or for any
prior period in respect of any transaction, event or omission occurring, or any
profit earned, on or prior to the Pubco Accounting Date or for any profit earned
by Pubco on or prior to the Pubco Accounting Date or for which Pubco is
accountable up to such date and all contingent Liabilities for Taxes have been
provided for or disclosed in the Pubco Financial Statements.

4.15                   Absence of Changes. Since the Pubco Accounting Date,
except as disclosed in the Public SEC Documents and except as contemplated in
this Agreement, Pubco has not:

  (a)

incurred any Liabilities, other than Liabilities incurred in the ordinary course
of business consistent with past practice, or discharged or satisfied any lien
or encumbrance, or paid any Liabilities, other than in the ordinary course of
business consistent with past practice, or failed to pay or discharge when due
any Liabilities of which the failure to pay or discharge has caused or will
cause any material damage or risk of material loss to it or any of its assets or
properties;

        (b)

sold, encumbered, assigned or transferred any material fixed assets or
properties;

        (c)

created, incurred, assumed or guaranteed any indebtedness for money borrowed, or
mortgaged, pledged or subjected any of the material assets or properties of
Pubco to any mortgage, lien, pledge, security interest, conditional sales
contract or other encumbrance of any nature whatsoever;

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  (d)

made or suffered any amendment or termination of any material agreement,
contract, commitment, lease or plan to which it is a party or by which it is
bound, or cancelled, modified or waived any substantial debts or claims held by
it or waived any rights of substantial value, other than in the ordinary course
of business;

        (e)

declared, set aside or paid any dividend or made or agreed to make any other
distribution or payment in respect of its capital shares or redeemed, purchased
or otherwise acquired or agreed to redeem, purchase or acquire any of its
capital shares or equity securities;

        (f)

suffered any damage, destruction or loss, whether or not covered by insurance,
that materially and adversely effects its business, operations, assets,
properties or prospects;

        (g)

suffered any material adverse change in its business, operations, assets,
properties, prospects or condition (financial or otherwise);

        (h)

received notice or had knowledge of any actual or threatened labor trouble,
termination, resignation, strike or other occurrence, event or condition of any
similar character which has had or might have an adverse effect on its business,
operations, assets, properties or prospects;

        (i)

made commitments or agreements for capital expenditures or capital additions or
betterments exceeding in the aggregate $15,000;

        (j)

other than in the ordinary course of business, increased the salaries or other
compensation of, or made any advance (excluding advances for ordinary and
necessary business expenses) or loan to, any of its employees or directors or
made any increase in, or any addition to, other benefits to which any of its
employees or directors may be entitled;

        (k)

entered into any transaction other than in the ordinary course of business
consistent with past practice; or

        (l)

agreed, whether in writing or orally, to do any of the foregoing.

4.16                   Absence of Certain Changes or Events. Since the Pubco
Accounting Date, except as and to the extent disclosed in the Pubco SEC
Documents, there has not been:

  (a)

a Material Adverse Effect with respect to Pubco; or

        (b)

any material change by Pubco in its accounting methods, principles or practices.

4.17                   Subsidiaries. Pubco does not have any subsidiaries or
agreements of any nature to acquire any subsidiary or to acquire or lease any
other business operations, except as disclosed in the Pubco SEC Documents.

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4.18                   Personal Property. There are no material equipment,
furniture, fixtures and other tangible personal property and assets owned or
leased by Pubco, except as disclosed in the Pubco SEC Documents. Pubco
possesses, and has good and marketable title of all property necessary for the
continued operation of the business of Pubco as presently conducted and as
represented to Priveco and the Selling Shareholders. All such property is used
in the business of Pubco. All such property is in reasonably good operating
condition (normal wear and tear excepted), and is reasonably fit for the
purposes for which such property is presently used. All material equipment,
furniture, fixtures and other tangible personal property and assets owned or
leased by Pubco is owned by Pubco free and clear of all liens, security
interests, charges, encumbrances, and other adverse claims, except as previously
disclosed to Priveco.

4.19                   Intellectual Property

  (a)

Intellectual Property Assets. Pubco owns or holds an interest in all
intellectual property assets necessary for the operation of the business of
Pubco as it is currently conducted (collectively, the “Pubco Intellectual
Property Assets”), including:

          (i)

all functional business names, trading names, registered and unregistered
trademarks, service marks, and applications (collectively, the “Pubco Marks”);

          (ii)

all patents, patent applications, and inventions, methods, processes and
discoveries that may be patentable (collectively, the “Pubco Patents”);

          (iii)

all copyrights in both published works and unpublished works (collectively, the
“Pubco Copyrights”); and

          (iv)

all know-how, trade secrets, confidential information, customer lists, software,
technical information, data, process technology, plans, drawings, and blue
prints owned, used, or licensed by Pubco as licensee or licensor (collectively,
the “Pubco Trade Secrets”).

          (b)

Agreements. Pubco has previously provided Priveco with a complete and accurate
list of all material contracts and agreements relating to the Pubco Intellectual
Property Assets to which Pubco is a party or by which Pubco is bound, except for
any license implied by the sale of a product and perpetual, paid-up licenses for
commonly available software programs with a value of less than $15,000 under
which Pubco is the licensee (the “Pubco Intellectual Property List”). To the
best knowledge of Pubco, there are no outstanding or threatened disputes or
disagreements with respect to any such agreement.

          (c)

Intellectual Property and Know-How Necessary for the Business. Except as
previously provided in the Pubco Intellectual Property List, Pubco is the owner
of all right, title, and interest in and to each of the Pubco Intellectual
Property Assets, free and clear of all liens, security interests, charges,
encumbrances, and other adverse claims, and has the right to use without payment
to a third party of all the Pubco Intellectual Property Assets. Except as
provided in the Pubco Intellectual

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- 24 -

 

Property List, all former and current employees and contractors of Pubco have
executed written contracts, agreements or other undertakings with Pubco that
assign all rights to any inventions, improvements, discoveries, or information
relating to the business of Pubco. No employee, director, officer or shareholder
of Pubco owns directly or indirectly in whole or in part, any Pubco Intellectual
Property Asset which Pubco is presently using or which is necessary for the
conduct of its business. To the best knowledge of Pubco, no employee or
contractor of Pubco has entered into any contract or agreement that restricts or
limits in any way the scope or type of work in which the employee may be engaged
or requires the employee to transfer, assign, or disclose information concerning
his work to anyone other than Pubco.

        (d)

Patents. Except as previously provided in the Pubco Intellectual Property List,
Pubco does not hold any right, title or interest in and to any Pubco Patent and
Pubco has not filed any patent application with any third party. To the best
knowledge of Pubco, none of the products manufactured and sold, nor any process
or know-how used, by Pubco infringes or is alleged to infringe any patent or
other proprietary night of any other Person.

        (e)

Trademarks. Except as previously provided in the Pubco Intellectual Property
List, Pubco does not hold any right, title or interest in and to any Pubco Mark
and Pubco has not registered or filed any application to register any Pubco Mark
with any third party. To the best knowledge of Pubco, none of the Pubco Marks,
if any, used by Pubco infringes or is alleged to infringe any trade name,
trademark, or service mark of any third party.

        (f)

Copyrights. Pubco is the owner of all right, title, and interest in and to each
of the Pubco Copyrights, free and clear of all liens, security interests,
charges, encumbrances, and other adverse claims. If applicable, all registered
Pubco Copyrights are currently in compliance with formal legal requirements, are
valid and enforceable, and are not subject to any maintenance fees or taxes or
actions falling due within ninety days after the Closing Date. To the best
knowledge of Pubco, no Pubco Copyright is infringed or has been challenged or
threatened in any way and none of the subject matter of any of the Pubco
Copyrights infringes or is alleged to infringe any copyright of any third party
or is a derivative work based on the work of a third party. All works
encompassed by the Pubco Copyrights have been marked with the proper copyright
notice.

        (g)

Trade Secrets. Pubco has taken all reasonable precautions to protect the
secrecy, confidentiality, and value of its Pubco Trade Secrets. Pubco has good
title and an absolute right to use the Pubco Trade Secrets. The Pubco Trade
Secrets are not part of the public knowledge or literature, and to the best
knowledge of Pubco, have not been used, divulged, or appropriated either for the
benefit of any Person or to the detriment of Pubco. No Pubco Trade Secret is
subject to any adverse claim or has been challenged or threatened in any way.

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- 25 -

4.20                   Insurance. The products sold by and the assets owned by
Pubco are insured under various policies of general product liability and other
forms of insurance consistent with prudent business practices. All such policies
are in full force and effect in accordance with their terms, no notice of
cancellation has been received, and there is no existing default by Pubco, or
any event which, with the giving of notice, the lapse of time or both, would
constitute a default thereunder. All premiums to date have been paid in full.

4.21                   Employees and Consultants. To the best knowledge of
Pubco, no employee of Pubco is in violation of any term of any employment
contract, non-disclosure agreement, non-competition agreement or any other
contract or agreement relating to the relationship of such employee with Pubco
or any other nature of the business conducted or to be conducted by Pubco.

4.22                   Real Property. Pubco does not own any real property. Each
of the leases, subleases, claims or other real property interests (collectively,
the “Pubco Leases”) to which Pubco is a party or is bound, as disclosed in
writing to Priveco or as disclosed in the Pubco SEC Documents, is legal, valid,
binding enforceable and in full force and effect in all material respects. All
rental and other payments required to be paid by Pubco pursuant to any such
Pubco Leases have been duly paid and no event has occurred which, upon the
passing of time, the giving of notice, or both, would constitute a breach or
default by any party under any of the Pubco Leases. The Pubco Leases will
continue to be legal, valid, binding, enforceable and in full force and effect
on identical terms following the Closing Date. Pubco has not assigned,
transferred, conveyed, mortgaged, deeded in trust, or encumbered any interest in
the Pubco Leases or the leasehold property pursuant thereto.

4.23                   Material Contracts and Transactions. Other than as
expressly contemplated by this Agreement, there are no material contracts,
agreements, licenses, permits, arrangements, commitments, instruments or
understandings, whether written or oral, express or implied, contingent, fixed
or otherwise, to which Pubco is a party (the “Pubco Contracts”) except as
previously disclosed to Priveco or as disclosed in the Pubco SEC Documents.
Pubco has made available to Priveco and the Selling Shareholders each Pubco
Contract. Each Pubco Contract is in full force and effect, and there exists no
material breach or violation of or default by Pubco under any Pubco Contract, or
any event that with notice or the lapse of time, or both, will create a material
breach or violation thereof or default under any Pubco Contract by Pubco. To the
best knowledge of Pubco, the continuation, validity, and effectiveness of each
Pubco Contract will in no way be affected by the consummation of the Transaction
contemplated by this Agreement. There exists no actual or threatened
termination, cancellation, or limitation of, or any amendment, modification, or
change to any Pubco Contract.

4.24                   Certain Transactions. Except as previously disclosed to
Priveco or as disclosed in the Pubco SEC Documents, Pubco is not a guarantor or
indemnitor of any indebtedness of any Person.

4.25                   No Brokers. Pubco has not incurred any obligation or
liability to any party for any brokerage fees, agent’s commissions, or finder’s
fees in connection with the Transaction contemplated by this Agreement.

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- 26 -

4.26                   Internal Accounting Controls. Pubco maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

4.27                   Listing and Maintenance Requirements. Pubco is currently
quoted on the OTC Bulletin Board and has not, in the 12 months preceding the
date hereof, received any notice from the OTC Bulletin Board or the FINRA or any
trading market on which Pubco’s common stock is or has been listed or quoted to
the effect that Pubco is not in compliance with the quoting, listing or
maintenance requirements of the OTC Bulletin Board or such other trading market.
No securities commission or other regulatory authority has issued any order
preventing or suspending the trading of the Pubco securities or prohibiting the
issuance of Pubco Shares to be delivered hereunder, and, to Pubco’s knowledge,
no proceedings for such purpose are pending or threatened.

4.28                   No SEC or FINRA Inquiries. Neither the Pubco nor any of
its past or present officers or directors is the subject of any formal or
informal inquiry or investigation by the SEC or FINRA. Pubco currently does not
have any outstanding comment letters or other correspondences from the SEC or
FINRA.

4.29                   Completeness of Disclosure. No representation or warranty
by Pubco in this Agreement nor any certificate, schedule, statement, document or
instrument furnished or to be furnished to Priveco pursuant hereto contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact required to be stated herein or therein or necessary to
make any statement herein or therein not materially misleading.

5.                       CLOSING CONDITIONS

5.1                     Conditions Precedent to Closing by Pubco. The obligation
of Pubco to consummate the Transaction is subject to the satisfaction or written
waiver of the conditions set forth below by a date mutually agreed upon by the
parties hereto in writing and in accordance with Section 10.6. The Closing of
the Transaction contemplated by this Agreement will be deemed to mean a waiver
of all conditions to Closing. These conditions precedent are for the benefit of
Pubco and may be waived by Pubco in its sole discretion.

  (a)

Representations and Warranties. The representations and warranties of Priveco
set forth in this Agreement will be true, correct and complete in all respects
as of the Closing Date, as though made on and as of the Closing Date and Priveco
will have delivered to Pubco a certificate dated as of the Closing Date, to the
effect that the representations and warranties made by Priveco in this Agreement
are true and correct.

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- 27 -

  (b)

Performance. All of the covenants and obligations that Priveco and the Selling
Shareholders are required to perform or to comply with pursuant to this
Agreement at or prior to the Closing must have been performed and complied with
in all material respects.

          (c)

Transaction Documents. This Agreement, the Priveco Documents, the Priveco
Financial Statements and all other documents necessary or reasonably required to
consummate the Transaction, all in form and substance reasonably satisfactory to
Pubco, will have been executed and delivered to Pubco.

          (d)

Remaining Priveco Shareholders. To the extent that there are any Remaining
Priveco Shareholders who have not returned a duly completed and executed Letter
of Transmittal together with the certificates representing the Priveco Shares
held by them (each a “Forced Shareholder”), the Chief Executive Officer of
Priveco as attorney for the Forced Shareholders in accordance with Section
4.8(e) of the Shareholder Agreement, in the name of the Forced Shareholder,
shall have executed and delivered (i) all documents and instruments to give
effect to the purchase by Pubco of the Priveco Shares held by such Forced
Shareholder in accordance with this Agreement and the Shareholder Agreement, to
establish a binding contract of purchase and sale between each of the Forced
Shareholders and Pubco and (ii) all deeds, transfers, assignments and assurances
necessary to effectively transfer any Priveco Shares held by any Forced
Shareholder to Pubco; provided that the Pubco Shares to be issued in
consideration for such Priveco Shares shall have been deposited into escrow in a
form agreed to between Priveco and Pubco.

          (e)

Escrow Agreement. The Selling Shareholders and Priveco shall have entered into
an escrow agreement with Pubco whereby the Selling Shareholders will deposit
into escrow a prescribed number of the Pubco Shares issuable to them pursuant to
this Agreement in the event that Priveco does not have a specified level of cash
on the Closing Date and does not receive certain amounts of scientific research
and experimental development tax credits.

          (f)

Secretary’s Certificate – Priveco. Pubco will have received a certificate from
the Secretary of Priveco attaching:

          (i)

a copy of Priveco’s Articles of Incorporation as amended through the Closing
Date; and

          (ii)

copies of resolutions duly adopted by the board of directors of Priveco
approving the execution and delivery of this Agreement and the consummation of
the transactions contemplated herein.

          (g)

Legal Opinion – Priveco. Pubco will have received an opinion, dated as of the
Closing Date, from counsel for Priveco, and such other local or special counsel
as is appropriate, all of which opinion will be in the form and substance
reasonably satisfactory to Pubco and its counsel.

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  (h)

Third Party Consents. Pubco will have received duly executed copies of all third
party consents and approvals contemplated by this Agreement, in form and
substance reasonably satisfactory to Pubco.

          (i)

Severance Agreements. Pubco will (i) have received from Priveco copies of all
executed agreements, which agreements will be effective before Closing, that
evidence the severance arrangements with respect to the Terminated Employees,
and (ii) be satisfied with such agreements.

          (j)

No Material Adverse Change. No Material Adverse Effect will have occurred in
respect of Priveco since the date of this Agreement.

          (k)

No Action. No suit, action, or proceeding will be pending or threatened which
would:

          (i)

prevent the consummation of any of the transactions contemplated by this
Agreement; or

          (ii)

cause the Transaction to be rescinded following consummation.

          (l)

Capitalization of Priveco. Priveco will have no more than 1,435,343 shares of
Priveco Common Stock, 4,164,552 shares of Priveco Class A Stock, 4,490,968
shares of Priveco Class B Stock, 6,114,243 shares of Priveco Class C Stock and
approximately 5,816,917 shares of Priveco Class D Stock issued and outstanding
on the Closing Date. Other than the Priveco Options and the Priveco Shares
described above, there will be no outstanding options, warrants, subscriptions,
conversion rights, or other rights, agreements, or commitments obligating
Priveco to issue any additional shares of Priveco Common Stock, or any other
securities convertible into, exchangeable for, or evidencing the right to
subscribe for or acquire from Priveco any shares of Priveco Common Stock.

          (m)

No Convertible Debt. On Closing, Priveco will have no outstanding convertible
debt.

          (n)

Delivery of Financial Statements. Priveco will have delivered to Pubco the
Priveco Financial Statements, which financial statements will include audited
financial statements for Priveco’s two fiscal years, prepared in accordance with
Canadian GAAP.

          (o)

Priveco Working Capital. On Closing, Priveco will have cash of not less than
$5,750,000 and working capital (defined as current assets less current
liabilities and long term liabilities) of not less than $6,900,001 (net of the
costs of Priveco associated with the Transaction), which includes scientific
research and experimental development (“SRED”) cash refunds accrued as of the
date of this Agreement of $1,125,000, provided that such amounts will be reduced
by the amounts paid or payable to any Terminated Employee in connection with the
termination of his or her employment with Priveco (the “Severance Amounts”).

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  (p)

SRED Refund/Credit. Priveco will have submitted, or will provide evidence to
Pubco and the Selling Shareholders that Priveco is entitled to submit, SRED
claims for SRED cash refunds (or SRED credits in the case of any amounts claimed
after the date of this Agreement) of at least $1,125,000.

5.2                     Conditions Precedent to Closing by Priveco. The
obligation of Priveco and the Selling Shareholders to consummate the Transaction
is subject to the satisfaction or written waiver of the conditions set forth
below by a date mutually agreed upon by the parties hereto in writing and in
accordance with Section 10.6. The Closing of the Transaction will be deemed to
mean a waiver of all conditions to Closing. These conditions precedent are for
the benefit of Priveco and the Selling Shareholders and may be waived by Priveco
and the Selling Shareholders in their discretion.

  (a)

Representations and Warranties. The representations and warranties of Pubco set
forth in this Agreement will be true, correct and complete in all respects as of
the Closing Date, as though made on and as of the Closing Date and Pubco will
have delivered to Priveco and the Selling Shareholders a certificate dated the
Closing Date, to the effect that the representations and warranties made by
Pubco in this Agreement are true and correct.

        (b)

Performance. All of the covenants and obligations that Pubco are required to
perform or to comply with pursuant to this Agreement at or prior to the Closing
must have been performed and complied with in all material respects. Pubco must
have delivered each of the documents required to be delivered by it pursuant to
this Agreement.

        (c)

Transaction Documents. This Agreement, the Pubco Documents and all other
documents necessary or reasonably required to consummate the Transaction, all in
form and substance reasonably satisfactory to Priveco, will have been executed
and delivered by Pubco.

        (d)

Legal Opinion – Pubco. Priveco and the Priveco Shareholders will have received a
legal opinion, dated as of the Closing Date, from counsel for Pubco, and such
other local or special legal counsel as is appropriate, all of which opinion
shall be in the form and substance reasonably satisfactory to Priveco, the
Selling Shareholders and their respective counsel.

        (e)

Third Party Consents. Priveco will have received from Pubco duly executed copies
of all third-party consents, permits, authorisations and approvals of any
public, regulatory (including the SEC) or governmental body or authority or
Person contemplated by this Agreement, in the form and substance reasonably
satisfactory to Priveco.

        (f)

No Material Adverse Change. No Material Adverse Effect will have occurred in
respect of Pubco since the date of this Agreement.

        (g)

Capitalization of Pubco. Pubco will have no more than 95,108,887 shares of Pubco
Common Stock and one (1) share of Pubco Preferred Stock issued and

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outstanding on the Closing Date. Other than the Pubco Warrants, Pubco Options
and exchangeable preferred shares of 6789722 Canada Inc. referred to in Section
4.3 hereof, there will be no outstanding options, warrants, subscriptions,
conversion rights, or other rights, agreements, or commitments obligating Pubco
to issue any additional shares of Pubco Common Stock, or any other securities
convertible into, exchangeable for, or evidencing the right to subscribe for or
acquire from Pubco any shares of Pubco stock.

          (h)

No Action. No suit, action, or proceeding will be pending or threatened before
any governmental or regulatory authority wherein an unfavorable judgment, order,
decree, stipulation, injunction or charge would result in and/or:

          (i)

prevent the consummation of any of the transactions contemplated by this
Agreement; or

          (ii)

cause the Transaction to be rescinded following consummation.

          (i)

Options. Pubco shall provide evidence that it has granted the Pubco Options to
all Retained Option Holders, subject only to each such Retained Option Holder
executing the option agreements to be delivered by Pubco pursuant to Section
6.18 hereof.

6.                       ADDITIONAL COVENANTS OF THE PARTIES

6.1                     Notification of Financial Liabilities. Priveco will
immediately notify Pubco in accordance with Section 10.6 hereof, if Priveco
receives any advice or notification from its independent certified public
accountants that Priveco has used any improper accounting practice that would
have the effect of not reflecting or incorrectly reflecting in the books,
records, and accounts of Priveco, any properties, assets, Liabilities, revenues,
or expenses. Pubco will immediately notify Priveco and the Selling Shareholders
in accordance with Section 10.6 hereof, if Pubco receives any advice or
notification from its independent certified public accountants that Pubco has
used any improper accounting practice that would have the effect of not
reflecting or incorrectly reflecting in the books, records, and accounts of
Pubco, any properties, assets, Liabilities, revenues, or expenses.
Notwithstanding any statement to the contrary in this Agreement, the covenants
contained in this Section will survive Closing and continue in full force and
effect.

6.2                     Access and Investigation. Between the date of this
Agreement and the Closing Date, Priveco, on the one hand, and Pubco, on the
other hand, will, and will cause each of their respective representatives to:

  (a)

afford the other, the Selling Shareholders and their respective representatives
full and free access to its personnel, properties, assets, contracts, books and
records, and other documents and data;

        (b)

furnish the other, the Selling Shareholders and their respective representatives
with copies of all such contracts, books and records, and other existing
documents

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- 31 -

 

and data as required by this Agreement and as may be otherwise reasonably
requested; and

        (c)

furnish the other, the Selling Shareholders and their respective representatives
with such additional financial, operating, and other data and information as may
be reasonably requested.

All of such access, investigation and communication by a party and its
representatives will be conducted during normal business hours and in a manner
designed not to interfere unduly with the normal business operations of the
other party. Each party will instruct its auditors to cooperate with the other
party and its representatives in connection with such investigations.

6.3                     Confidentiality. All information regarding the business
of Priveco including, without limitation, financial information that Priveco
provides to Pubco during Pubco’s due diligence investigation of Priveco will be
kept in strict confidence by Pubco and will not be used (except in connection
with due diligence), dealt with, exploited or commercialized by Pubco or
disclosed to any third party (other than Pubco’s professional accounting and
legal advisors) without the prior written consent of Priveco. If the Transaction
contemplated by this Agreement does not proceed for any reason, then upon
receipt of a written request from Priveco, Pubco will immediately return to
Priveco (or as directed by Priveco) any information received regarding Priveco’s
business. Likewise, all information regarding the business of Pubco including,
without limitation, financial information that Pubco provides to Priveco during
its due diligence investigation of Pubco will be kept in strict confidence by
Priveco and will not be used (except in connection with due diligence), dealt
with, exploited or commercialized by Priveco or disclosed to any third party
(other than Priveco’s professional accounting and legal advisors) without
Pubco’s prior written consent. If the Transaction contemplated by this Agreement
does not proceed for any reason, then upon receipt of a written request from
Pubco, Priveco will immediately return to Pubco (or as directed by Pubco) any
information received regarding Pubco’s business.

6.4                     Notification. Between the date of this Agreement and the
Closing Date, each of the parties to this Agreement will promptly notify the
other parties in writing if it becomes aware of any fact or condition that
causes or constitutes a material breach of any of its representations and
warranties as of the date of this Agreement, if it becomes aware of the
occurrence after the date of this Agreement of any fact or condition that would
cause or constitute a material breach of any such representation or warranty had
such representation or warranty been made as of the time of occurrence or
discovery of such fact or condition. Should any such fact or condition require
any change in the Schedules relating to such party, such party will promptly
deliver to the other parties a supplement to the Schedules specifying such
change. During the same period, each party will promptly notify the other
parties of the occurrence of any material breach of any of its covenants in this
Agreement or of the occurrence of any event that may make the satisfaction of
such conditions impossible or unlikely.

6.5                     Exclusivity. Until the earlier of Closing or such time,
if any, as this Agreement is terminated pursuant to this Agreement and other
than any current acquisitions or transactions being considered by Pubco, (i)
Priveco and Pubco will not, directly or indirectly, solicit, initiate, entertain
or accept any inquiries or proposals from, discuss or negotiate with, provide
any non-

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- 32 -

public information to, or consider the merits of any unsolicited inquiries or
proposals from, any Person relating to any transaction involving the sale of the
business or assets (other than in the ordinary course of business), or any of
the capital stock of Priveco or Pubco, as applicable, or any merger,
consolidation, business combination, or similar transaction other than as
contemplated by this Agreement, and (ii) Pubco will not, directly or indirectly,
solicit, initiate, entertain, make or accept any inquiries or proposals from,
discuss or negotiate with, provide or request any non-public information to, or
consider the merits of any transaction involving the acquisition by Pubco of the
business or assets (other than in the ordinary course of business) or any of the
capital stock of any Person other than Priveco.

6.6                     Conduct of Priveco and Pubco Business Prior to Closing.
From the date of this Agreement to the Closing Date, and except to the extent
that Pubco otherwise consents in writing, Priveco will operate its business
substantially as presently operated and only in the ordinary course and in
compliance with all applicable laws, and use its best efforts to preserve intact
its good reputation and present business organization and to preserve its
relationships with Persons having business dealings with it. Likewise, from the
date of this Agreement to the Closing Date, and except to the extent that
Priveco otherwise consents in writing, Pubco will operate its business
substantially as presently operated and only in the ordinary course and in
compliance with all applicable laws, and use its best efforts to preserve intact
its good reputation and present business organization and to preserve its
relationships with Persons having business dealings with it.

6.7                     Certain Acts Prohibited – Priveco. Except as expressly
contemplated by this Agreement or for purposes in furtherance of this Agreement,
between the date of this Agreement and the Closing Date, Priveco will not,
without the prior written consent of Pubco:

  (a)

amend its Articles of Incorporation;

          (b)

incur any liability or obligation other than in the ordinary course of business
or encumber or permit the encumbrance of any properties or assets of Priveco
except in the ordinary course of business;

          (c)

dispose of or contract to dispose of any Priveco property or assets, including
the Intellectual Property Assets, except in the ordinary course of business
consistent with past practice;

          (d)

issue, deliver, sell, pledge or otherwise encumber or subject to any lien any
shares of the Priveco Common Stock, or any rights, warrants or options to
acquire, any such shares, voting securities or convertible securities;

          (e)

not:

          (i)

declare, set aside or pay any dividends on, or make any other distributions in
respect of the Priveco Common Stock, or

          (ii)

split, combine or reclassify any Priveco Common Stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of Priveco Common Stock; or

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- 33 -

  (f)

not materially increase benefits or compensation expenses of Priveco, other than
as contemplated by the terms of any employment agreement in existence on the
date of this Agreement, increase the cash compensation of any director,
executive officer or other key employee or pay any benefit or amount not
required by a plan or arrangement as in effect on the date of this Agreement to
any such Person.

6.8                     Certain Acts Prohibited - Pubco. Except as expressly
contemplated by this Agreement, between the date of this Agreement and the
Closing Date, Pubco will not, without the prior written consent of Priveco:

  (a)

incur any liability or obligation or encumber or permit the encumbrance of any
properties or assets of Pubco except in the ordinary course of business
consistent with past practice;

          (b)

dispose of or contract to dispose of any Pubco property or assets except in the
ordinary course of business consistent with past practice;

          (c)

declare, set aside or pay any dividends on, or make any other distributions in
respect of the Pubco Common Stock;

          (d)

do any of the following without a concurrent adjustment to the consideration
deliverable hereunder for the transfer of the Priveco Shares and Priveco Options
as may be necessary to ensure that the percentage ownership of Pubco by the
Priveco Shareholders and Retained Option Holders following Closing on a fully
diluted basis is unaffected by such action, to the satisfaction of Priveco and
the Selling Shareholders as evidenced in writing:

          (i)

issue, deliver or sell any shares of the Pubco Common Stock (other than those
shares of Pubco Common Stock that may be issued as a result of the exercise of
any outstanding options, warrants or other convertible securities), or any
rights, warrants or options to acquire, any such shares, voting securities or
convertible securities,

          (ii)

declare, set aside or pay any dividends on, or make any other distributions in
respect of the Pubco Common Stock, or

          (iii)

split, combine or reclassify any Pubco Common Stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of Pubco Common Stock; or

          (e)

materially increase benefits or compensation expenses of Pubco, increase the
cash compensation of any director, executive officer or other key employee or
pay any benefit or amount to any such Person.

6.9                     Public Announcements. Pubco and Priveco each agree that
they will not release or issue any reports or statements or make any public
announcements relating to this Agreement or the Transaction contemplated herein
without the prior written consent of the other party, except as may be required
upon written advice of counsel to comply with applicable laws or

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regulatory requirements after consulting with the other party hereto and seeking
their reasonable consent to such announcement.

6.10                   Severance Agreements. Between the date of this Agreement
and the Closing Date, and upon approval of Pubco, Priveco will have made
necessary arrangements to terminate the employment of all Terminated Employees.
Priveco agrees to provide copies of all such severance agreements, which
severance agreements will be effective before Closing, that evidence such
terminations at or prior to Closing. Pubco will have no recourse in respect of
any liabilities of Priveco that may arise before or after the date hereof or
before or after the date of Closing with respect to the termination of the
Terminated Employees and, for greater certainty, such liabilities will not be
subject to indemnification.

6.11                   Escrow Agreement. On Closing, the Selling Shareholders,
Priveco, Pubco and an escrow agent (the “Escrow Agent”) will enter into an
escrow agreement (the “Escrow Agreement”), whereby the Selling Shareholders will
deposit into escrow such number of the Pubco Shares (the “Escrowed Shares”)
issuable to them pursuant to this Agreement as set out in the Escrow Agreement
as security for Priveco (i) meeting certain cash requirements as set out in
Section 6.12 hereof, if evidence of satisfaction of such cash requirements is
not provided on or before Closing, and (ii) accruing SRED claims for certain
amounts of SRED cash refunds (or SRED credits in the case of any amounts claimed
after the date of this Agreement) as set out in Section 6.13 hereof. In the
event that Priveco fails to (i) meet the prescribed cash requirements and/or
(ii) accrue SRED claims for the prescribed amount of SRED cash refunds, within
the specified time periods, the Escrow Agent will return all or a portion of the
Escrowed Shares to Pubco for cancellation in accordance with the terms of the
Escrow Agreement.

6.12                   Priveco Cash. In the event that Priveco has less than
$6,000,000 in cash on Closing, less the Severance Amounts, the Selling
Shareholders covenant and agree to provide, or arrange to provide, up to
$250,000 in cash (the “Cash Top Up”), which Cash Top Up may be paid through the
conversion of non-cash working capital (excluding any SRED claims received after
the date that is one year from the Closing Date) into cash, no later than the
date that is one (1) year from the Closing Date (the “Cash Date”). In the event
that the Selling Shareholders do not provide, or arrange to provide, any amount
of cash up to the Cash Top Up by the Cash Date, such number of the Escrowed
Shares as set out in the Escrow Agreement will be returned to Pubco for
cancellation.

6.13                   SRED Refund/Credit. In the event that Priveco receives
SRED claims for SRED cash refunds of less than $1,125,000, the Selling
Shareholders covenant and agree to provide, or arrange to provide, up to
$1,125,000 in cash (the “SRED Top Up”) no later than the date that is eighteen
(18) months from the Closing Date (the “SRED Date”). In the event that the
Selling Shareholders do not provide, or arrange to provide, any amount of cash
up to the SRED Top Up by the SRED Date, such number of the Escrowed Shares as
set out in the Escrow Agreement will be returned to Pubco for cancellation.
Priveco hereby covenants and agrees with the Selling Shareholders that it will
use its commercially reasonable best efforts to satisfy the following: (i) on or
before the Closing Date, it shall have applied for all applicable federal and
provincial SRED claims relating to financial periods ending on or before
December 31, 2007 (the “2007 Claim”); and (ii) within the earlier of (A) eight
(8) months from the Closing Date and (B) forty-five (45) days of the receipt of
a refund for the 2007 Claim, Priveco shall apply for all applicable

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federal and provincial SRED claims relating to the financial periods commencing
January 1, 2008 and ending on the date of execution of this Agreement by all
parties hereto.

6.14                   Board of Directors. Pubco shall take such steps as may be
necessary to replace all directors and officers of Priveco effective immediately
upon Closing with directors and officers of Pubco’s choosing.

6.15                   Preservation of Records. Following the Closing Date,
Pubco and Priveco covenant and agree that they will preserve, and make available
to the Selling Shareholders on reasonable request, all minute books, corporate
and financial records and tax returns of Priveco for a period of six (6) years
from the Closing Date, or for such longer period as is required by any
applicable Law, or as relates to the applicable statutory limitation period as
regards any possible claims that may relate to the relevant records, but neither
Pubco nor Priveco shall be responsible or liable to the Selling Shareholders for
or as a result of any accidental loss or destruction of or damage to any such
records.

6.16                   Delivery of Mail. In the event that Pubco or Priveco
receive after the Closing Date mail or other communications which directly
relate to any of the Selling Shareholders or which may affect any of the Selling
Shareholders, it shall take commercially reasonable steps to forward, deliver or
cause to be delivered all such mail and the contents thereof to such Selling
Shareholders.

6.17                   TSX Venture Exchange Listing. Pubco shall use its
commercially reasonable best efforts to obtain a listing of its common shares on
the TSXV as soon as practicable following execution of this Agreement and
thereby become a reporting issuer in the provinces of British Columbia and
Alberta concurrent with the listing of its common shares on the TSXV and upon
such listing and becoming a reporting issuer, to maintain such listing and its
status as a reporting issuer not in default for a period of not less than two
(2) years following the Closing Date, provided that this covenant will only
apply so long as Pubco has a class of securities listed on a stock exchange or
quotation system. Until the Pubco common shares are listed on the TSXV and Pubco
is a reporting issuer in the provinces of British Columbia and Alberta, Pubco
shall use its commercially reasonable best efforts to maintain (i) the quotation
of its common shares on the OTC Bulletin Board (or on such other stock exchanges
or quotation systems in Canada or the United States as Pubco may determine), and
(ii) the registration of its common shares under the Exchange Act.

6.18                   Option Agreements. Pubco shall deliver to the Retained
Option Holders option agreements and other documentation as may be required to
evidence the grant of Pubco Options to such Retained Option Holders as per the
terms of Section 2.3A hereof.

6.19                   Directors and Officers Insurance. Provided that the
premiums covering such period are paid by Priveco on or prior to Closing, for a
period of three (3) years after the Closing Date, Pubco covenants to maintain in
effect, or cause Priveco to maintain in effect, Priveco’s directors’ and
officers’ liability insurance existing as of the Closing Date covering those
Persons covered by such insurance immediately prior to the Closing.

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7.                       CLOSING

7.1                     Closing. The Closing shall take place on the Closing
Date at the offices of the lawyers for Pubco or at such other location as agreed
to by the parties. Notwithstanding the location of the Closing, each party
agrees that the Closing may be completed by the exchange of undertakings between
the respective legal counsel for Priveco and Pubco, provided such undertakings
are satisfactory to each party’s respective legal counsel.

7.2                     Closing Deliveries of Priveco and the Priveco
Shareholders. At Closing, Priveco and the Priveco Shareholders will deliver or
cause to be delivered the following, fully executed and in the form and
substance reasonably satisfactory to Pubco:

  (a)

copies of all resolutions and/or consent actions adopted by or on behalf of the
board of directors of Priveco evidencing approval of this Agreement and the
Transaction;

          (b)

if any of the Priveco Shareholders appoint any Person, by power of attorney or
equivalent, to execute this Agreement or any other agreement, document,
instrument or certificate contemplated by this agreement, on behalf of the
Priveco Shareholder, a valid and binding power of attorney or equivalent from
such Priveco Shareholder;

          (c)

share certificates representing the Priveco Shares as required by Section 2.3 of
this Agreement or, if applicable, a lost certificate indemnity in a form
satisfactory to Pubco acting reasonably, provided that in the event that any
Remaining Priveco Shareholder fails to deliver the share certificates
representing the Priveco Shares held by such shareholder and fails to deliver an
acceptable lost certificate indemnity, the Pubco Shares to be issued to such
Remaining Priveco Shareholder shall be deposited into escrow in a form agreed to
between Priveco and Pubco until such time as such Remaining Priveco Shareholder
delivers such certificates or lost certificate indemnity;

          (d)

all certificates and other documents required by Sections 2.3, and 5.1 of this
Agreement provided that in the event that any Remaining Priveco Shareholder
fails to deliver the certificates and other documents required by Section 2.3,
the share certificates representing the Priveco Shares held by such shareholder
and fails to deliver an acceptable lost certificate indemnity, the Pubco Shares
to be issued to such Remaining Priveco Shareholder shall be deposited into
escrow in a form agreed to between Priveco and Pubco until such time as such
Remaining Priveco Shareholder delivers such certificates or documents;

          (e)

a certificate of an officer of Priveco, dated as of Closing, certifying that:

          (i)

each covenant and obligation of Priveco has been complied with; and

          (ii)

each representation, warranty and covenant of Priveco is true and correct at the
Closing as if made on and as of the Closing;

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  (f)

the Priveco Documents, the Priveco Financial Statements and any other necessary
documents, each duly executed by Priveco, as required to give effect to the
Transaction;

        (g)

copies of all agreements and arrangements required by Section 6.10, Section
6.11, Section 6.12 and Section 6.13 of this Agreement.

7.3                     Closing Deliveries of Pubco. At Closing, Pubco will
deliver or cause to be delivered the following, fully executed and in the form
and substance reasonably satisfactory to Priveco:

  (a)

copies of all resolutions and/or consent actions adopted by or on behalf of the
board of directors of Pubco evidencing approval of this Agreement and the
Transaction;

          (b)

all certificates and other documents required by Section 5.2 of this Agreement;

          (c)

a certificate of an officer of Pubco, dated as of Closing, certifying that:

          (i)

each covenant and obligation of Pubco has been complied with; and

          (ii)

each representation, warranty and covenant of Pubco is true and correct at the
Closing as if made on and as of the Closing; and

          (d)

the Pubco Documents and any other necessary documents, each duly executed by
Pubco, as required to give effect to the Transaction.

7.4                     Additional Closing Deliveries of Pubco. At Closing,
Pubco will deliver or cause to be delivered the share certificates representing
the Pubco Shares with those certificates representing Pubco Shares issuable to
Remaining Priveco Shareholders who have not returned all documentation required
by this Agreement to be placed into escrow as per the terms hereof;.

8.                       TERMINATION

8.                    1 Termination. This Agreement may be terminated at any
time prior to the Closing Date contemplated hereby by:

  (a)

mutual agreement of Pubco and Priveco;

        (b)

Pubco, if there has been a material breach by Priveco or any of the Priveco
Security Holders of any material representation, warranty, covenant or agreement
set forth in this Agreement on the part of Priveco or the Priveco Security
Holders that is not cured, to the reasonable satisfaction of Pubco, within ten
business days after notice of such breach is given by Pubco (except that no cure
period will be provided for a breach by Priveco or the Priveco Security Holders
that by its nature cannot be cured);

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- 38 -

  (c)

Priveco or any of the Selling Shareholders, if there has been a material breach
by Pubco of any material representation, warranty, covenant or agreement set
forth in this Agreement on the part of Pubco that is not cured by the breaching
party, to the reasonable satisfaction of Priveco or such Selling Shareholder(s),
within ten business days after notice of such breach is given by Priveco or the
Selling Shareholder(s) (except that no cure period will be provided for a breach
by Pubco that by its nature cannot be cured);

        (d)

Pubco or Priveco, if the Transaction contemplated by this Agreement has not been
consummated prior to 21 days after the delivery of the Priveco Financial
Statements, unless the parties hereto agree to extend such date in writing;

        (e)

Pubco or Priveco if any permanent injunction or other order of a governmental
entity of competent authority preventing the consummation of the Transaction
contemplated by this Agreement has become final and non-appealable; or

        (f)

if the Transaction has not been consummated prior to March 31, 2008.

8.2                     Effect of Termination. In the event of the termination
of this Agreement as provided in Section 8.1, this Agreement will be of no
further force or effect, provided, however, that no termination of this
Agreement will relieve any party of liability for any breaches of this Agreement
that are based on a wrongful refusal or failure to perform any obligations.

9.                       INDEMNIFICATION, REMEDIES, SURVIVAL

9.1                     Certain Definitions. For the purposes of this Article 9
the terms “Loss” and “Losses” mean any and all demands, claims, actions or
causes of action, assessments, losses, damages, Liabilities, costs, and
expenses, including without limitation, interest, penalties, fines and
reasonable attorneys, accountants and other professional fees and expenses, but
excluding any indirect, consequential or punitive damages suffered by Pubco or
Priveco including damages for lost profits or lost business opportunities.

9.2                     Agreement of Priveco to Indemnify. Priveco will
indemnify, defend, and hold harmless, to the full extent of the law, Pubco and
its shareholders from, against, and in respect of any and all Losses asserted
against, relating to, imposed upon, or incurred by Pubco and its shareholders by
reason of, resulting from, based upon or arising out of:

  (a)

the breach by Priveco of any representation or warranty of Priveco contained in
or made pursuant to this Agreement, any Priveco Document or any certificate or
other instrument delivered pursuant to this Agreement; or

        (b)

the breach or partial breach by Priveco of any covenant or agreement of Priveco
made in or pursuant to this Agreement, any Priveco Document or any certificate
or other instrument delivered pursuant to this Agreement.

9.3                     Agreement of the Priveco Security Holders to Indemnify.
The Selling Shareholders will each, severally and not jointly and severally,
indemnify, defend, and hold harmless, to the full extent of the law, Pubco and
its shareholders from, against, and in respect of

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- 39 -

any and all Losses asserted against, relating to, imposed upon, or incurred by
Pubco and its shareholders by reason of, resulting from, based upon or arising
out of:

  (a)

any breach by such Selling Shareholder of Section 2.2 of this Agreement; or

        (b)

any misstatement, misrepresentation or breach of the representations and
warranties made by such Selling Shareholder contained in or made pursuant to the
Regulation S Certificate or Rule 506 Certificate executed by each Selling
Shareholder as part of the share exchange procedure detailed in Section 2.3 and
Section 2.3A of this Agreement.

9.4                     Agreement of Pubco to Indemnify. Pubco will indemnify,
defend, and hold harmless, to the full extent of the law, Priveco and the
Priveco Security Holders from, against, for, and in respect of any and all
Losses asserted against, relating to, imposed upon, or incurred by Priveco and
the Priveco Security Holders by reason of, resulting from, based upon or arising
out of:

  (a)

the breach by Pubco of any representation or warranty of Pubco contained in or
made pursuant to this Agreement, any Pubco Document or any certificate or other
instrument delivered pursuant to this Agreement; or

        (b)

the breach or partial breach by Pubco of any covenant or agreement of Pubco made
in or pursuant to this Agreement, any Pubco Document or any certificate or other
instrument delivered pursuant to this Agreement.

9.5                     Limitation on Indemnity. Any party entitled to
indemnification under Sections 9.2, 9.3 or 9.4 shall only be entitled to
indemnification in respect of any Losses after the aggregate amount of such
Losses exceeds $50,000, at which point the indemnified party shall be entitled
to recover the entire amount of such Losses from the first dollar (including the
first $50,000).

10.                     MISCELLANEOUS PROVISIONS

10.1                    Effectiveness of Representations; Survival. Each party
is entitled to rely on the representations, warranties and agreements of each of
the other parties and all such representation, warranties and agreement will be
effective regardless of any investigation that any party has undertaken or
failed to undertake. Unless otherwise stated in this Agreement, and except for
instances of fraud, the representations, warranties and agreements will survive
the Closing Date and continue in full force and effect until one (1) year after
the Closing Date.

10.2                     Further Assurances. Each of the parties hereto will
co-operate with the others and execute and deliver to the other parties hereto
such other instruments and documents and take such other actions as may be
reasonably requested from time to time by any other party hereto as necessary to
carry out, evidence, and confirm the intended purposes of this Agreement.

10.3                     Amendment. This Agreement may not be amended except by
an instrument in writing signed by each of the parties.

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10.4                     Expenses. Pubco and Priveco will bear their respective
costs incurred in connection with the preparation, execution and performance of
this Agreement and the Transaction contemplated hereby, including all fees and
expenses of their respective agents, representatives and accountants, provided
that if the Closing does not occur on or prior to February 1, 2008 solely due to
the actions or inactions of Pubco, including but not limited to failure by Pubco
to obtain any regulatory or shareholder approvals, then Pubco shall be
responsible for the costs incurred by Priveco and the Priveco Security Holders
in furtherance of and closing of the Transaction after February 1, 2008. Prior
to the Closing Date, Priveco will reimburse the Selling Shareholders with
respect to reasonable out-of-pocket expenses and legal fees and disbursements
incurred by each of the Selling Shareholders in connection with the Transaction
contemplated hereby, including without limitation the preparation, execution and
delivery of this Agreement and all documents and instruments executed pursuant
to this Agreement, up to $25,000 per Selling Shareholder to an aggregate maximum
of $75,000 (or such greater amount as may be agreed to by Priveco and the
Selling Shareholders)(the “Legal Cost Reimbursement”). For greater clarity, the
Legal Cost Reimbursement will be deducted from the cash or the working capital
amount, as appropriate, referred to in Section 5.1(o) hereof.

10.5                     Entire Agreement. This Agreement, the schedules
attached hereto and the other documents in connection with this transaction
contain the entire agreement between the parties with respect to the subject
matter hereof and supersede all prior arrangements and understandings, both
written and oral, expressed or implied, with respect thereto. Any preceding
correspondence or offers are expressly superseded and terminated by this
Agreement.

10.6                     Notices. All notices and other communications required
or permitted under this Agreement must be in writing and will be deemed given if
sent by personal delivery, faxed with electronic confirmation of delivery,
internationally-recognized express courier or registered or certified mail
(return receipt requested), postage prepaid, to the parties at the following
addresses (or at such other address for a party as will be specified by like
notice):

If to Priveco:

Firsthand Technologies Inc.
Suite 300, 350 Terry Fox Drive
Ottawa, Ontario, Canada K2K 2P5

Attention:                     Mike Kelly
Telephone:                   (613) 254-8886
Facsimile:                      (613) 254-8887

With a copy (which will not constitute notice) to:

 LaBarge Weinstein Professional Corporation
Suite 800, 515 Legget Drive
Ottawa, Ontario K2K 3G4

Attention:                     Shane McLean
Telephone:                   (613) 599-9600 ext. 262
Facsimile:                      (613) 599-0018

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If to any of the Priveco Security Holders to the addresses set forth for such
Priveco Security Holders in the Priveco shareholder register.

If to Pubco:

CounterPath Corporation
Suite 300, One Bentall Centre
505 Burrard Street
Vancouver, British Columbia V7X 1M3

Attention:                     David Karp
Telephone:                   (604) 628-9364
Facsimile:                      (604) 320-3399

With a copy (which will not constitute notice) to:

Clark Wilson LLP
Barristers & Solicitors
Suite 800 – 885 West Georgia Street
Vancouver, British Columbia, Canada
V6C 3H1

Attention:                     Virgil Z. Hlus
Telephone:                   (604) 687-5700
Facsimile:                       (604) 687-6314

All such notices and other communications will be deemed to have been received:

  (a)

in the case of personal delivery, on the date of such delivery;

        (b)

in the case of a fax, when the party sending such fax has received electronic
confirmation of its delivery;

        (c)

in the case of delivery by internationally-recognized express courier, on the
business day following dispatch; and

        (d)

in the case of mailing, on the fifth business day following mailing.

10.7                     Headings. The headings contained in this Agreement are
for convenience purposes only and will not affect in any way the meaning or
interpretation of this Agreement.

10.8                     Benefits. This Agreement is and will only be construed
as for the benefit of or enforceable by those Persons party to this Agreement.

10.9                     Assignment. This Agreement may not be assigned (except
by operation of law) by any party without the consent of the other parties.

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- 42 -

10.10                   Governing Law. This Agreement will be governed by and
construed in accordance with the laws of the Province of British Columbia
applicable to contracts made and to be performed therein.

10.11                   Construction. The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction will be applied against any party.

10.12                   Gender. All references to any party will be read with
such changes in number and gender as the context or reference requires.

10.13                   Business Days. If the last or appointed day for the
taking of any action required or the expiration of any rights granted herein
shall be a Saturday, Sunday or a legal holiday in the Provinces of British
Columbia or Ontario, then such action may be taken or right may be exercised on
the next succeeding day which is not a Saturday, Sunday or such a legal holiday.

10.14                   Counterparts. This Agreement may be executed in one or
more counterparts, all of which will be considered one and the same agreement
and will become effective when one or more counterparts have been signed by each
of the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.

10.15                   Fax Execution. This Agreement may be executed by
delivery of executed signature pages by fax and such fax execution will be
effective for all purposes.

10.16                   Schedules and Exhibits. The schedules and exhibits are
attached to this Agreement and incorporated herein.

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.

COUNTERPATH CORPORATION

  /s/ Greg Pelling   Per:  Authorized Signatory 
Name: Greg Pelling 
Title: Chief Executive Officer  

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FIRSTHAND TECHNOLOGIES INC.

  /s/ David Hattey   Per:  Authorized Signatory 
Name: David Hattey
Title: Chief Executive Officer  

COVINGTON CAPITAL CORPORATION
as agent for COVINGTON VENTURE FUND INC.

  /s/ Scott Clark   Per:  Authorized Signatory 
Name: Scott Clark
Title: Managing Director  

SKYPOINT II, G.P. CO. INC., as Nominee

  /s/ Leo Lax   Per:  Authorized Signatory 
Name: Leo Lax
Title: Chief Executive Officer  

SKYPOINT II, G.P. CO. (US), INC., as Nominee

  /s/ Leo Lax   Per:  Authorized Signatory 
Name: Leo Lax
Title: Chief Executive Officer  

BDC CAPITAL INC.

  /s/ Roch Charbonneau   Per:  Authorized Signatory 
Name: Roch Charbonneau
Title: Director  

  /s/ Glenn Egan   Per:  Authorized Signatory 
Name: Glenn Egan
Title: Vice President  

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SCHEDULE 1

TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AND OPTION HOLDERS AS SET OUT IN THE SHARE
EXCHANGE AGREEMENT

THE PRIVECO SHAREHOLDERS

Name
Class and Number of Priveco
Shares held before Closing1 Total Number of Pubco
Shares to be issued by Pubco
on Closing1
Alain Mouttham

125,000 Class A Voting
Preferred Shares
1

Valentine Lee

50,000 Class A Voting
Preferred Shares
1

Covington Venture Fund Inc. a/c 104072-053

2,200,000 Class A Voting
Preferred Shares (in name of
Royal Trust Corporation in trust
for account #104072-010 (New
Millennium))

2,185,669 Class B Voting
Preferred Shares (in name of
RBC Global Services in trust
for account #104072-010)

1,709,761 Class C Voting
Preferred Shares (in name of
Covington Venture Fund Inc.)

1,938,976 Class D Voting
Preferred Shares (in name of
Covington Venture Fund Inc.)
9,072,622

Venturelab Beta, LLC
172,879 Common Shares
1
Venturelab Delta, LLC

58,850 Common shares,

84,873 Class A Voting
Preferred Shares
1

Venturelab Epsilon, LLC

256,179 Class A Voting
Preferred Shares
1

Venturelab Zeta, LLC

150,000 Class A Voting
Preferred Shares
1

Venturelab Theta, LLC

119,630 Class B Voting
Preferred Shares
1

Venturelab Partners, LLC

168,420 Class C Voting
Preferred Shares
390,228

________________________________________
1 The total number of Pubco Shares to be issued to each Priveco Shareholder
shall be adjusted on Closing to reflect the actual number of Class D Voting
Preferred Shares issuable by Priveco immediately prior to closing to the extent
such number deviates from the total number of Class D Voting Preferred Shares
set out in this table and in the body of this Agreement. The allocation of Pubco
Shares set out in this table and any subsequent adjustment on account of a
variation in the number of Class D Voting Preferred Shares is made based on the
liquidation preferences attaching to the Priveco Shares in the Priveco articles
of incorporation and using an agreed value of $0.45 per Pubco Share.

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- 2 -

Name
Class and Number of Priveco
Shares held before Closing1 Total Number of Pubco
Shares to be issued by Pubco
on Closing1 The Vechery Family Trust
73,500 Class A Voting
Preferred Shares 1
The Trustees of Columbia University in the
City of New York
757,843 Common Shares,
25,000 Class A Voting
Preferred Shares 1

Skypoint II, G.P. Co. Inc., as nominee

1,134,840 Class A Voting
Preferred Shares

2,066,987 Class B Voting
Preferred Shares

1,616,921 Class C Voting
Preferred Shares

1,833,690 Class D Voting
Preferred Shares
8,579,979

Skypoint II, G.P. Co. (US), Inc., as nominee

65,160 Class A Voting
Preferred Shares

118,682 Class B Voting
Preferred Shares

92,840 Class C Voting
Preferred Shares

105,286 Class D Voting
Preferred Shares
492,644

Santo Pittsman 21,500 Common Shares 1 Blake Technologies, Ltd. 55,332 Common
Shares 1 Mark Coles 21,500 Common Shares 1 John G. Coles 128,443 Common Shares 1
Skymeadow Ventures LLC 205,758 Common Shares 1 Spectrum Law Group 3,363 Common
Shares 1 Michael Tompkins 9,875 Common Shares 1 BDC Capital Inc.

2,526,301 Class C Voting
Preferred Shares

1,938,965 Class D Voting
Preferred Shares 10,964,511

Total shares:   29,500,000

--------------------------------------------------------------------------------

SCHEDULE 2A
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

CERTIFICATE OF NON-U.S. SHAREHOLDER

In connection with the issuance of common stock (the “Pubco Shares”) and options
(the “Pubco Options”) of COUNTERPATH CORPORATION, a Nevada corporation
(“Pubco”), to the undersigned, pursuant to that certain Share Exchange Agreement
dated January 28, 2008 (the “Agreement”), among Pubco, Firsthand Technologies
Inc., a Ontario corporation (“Priveco”) and certain shareholders of Priveco as
set out in the Agreement (each, a “Selling Shareholder”). Capitalized terms used
but not otherwise defined in this Certificate shall have the meanings given to
such terms in the Agreement. The undersigned Security Holder hereby agrees,
acknowledges, represents and warrants that:

          1.      the undersigned is not a “U.S. Person” as such term is defined
by Rule 902 of Regulation S under the United States Securities Act of 1933, as
amended (“U.S. Securities Act”) (the definition of which includes, but is not
limited to, an individual resident in the U.S. and an estate or trust of which
any executor or administrator or trust, respectively is a U.S. Person and any
partnership or corporation organized or incorporated under the laws of the
U.S.);

          2.      none of the Pubco Shares or the Pubco Options (the Pubco
Shares and the Pubco Options collectively referred to as, the “Pubco
Securities”) have been or will be registered under the U.S. Securities Act, or
under any state securities or “blue sky” laws of any state of the United States,
and may not be offered or sold in the United States or, directly or indirectly,
to U.S. Persons, as that term is defined in Regulation S, except in accordance
with the provisions of Regulation S or pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the U.S. Securities
Act and in compliance with any applicable state and foreign securities laws;

          3.      the Security Holder understands and agrees that offers and
sales of any of the Pubco Securities prior to the expiration of a period of one
year after the date of original issuance of the Pubco Securities (the one year
period hereinafter referred to as the “Distribution Compliance Period”) shall
only be made in compliance with the safe harbor provisions set forth in
Regulation S, pursuant to the registration provisions of the U.S. Securities Act
or an exemption therefrom, and that all offers and sales after the Distribution
Compliance Period shall be made only in compliance with the registration
provisions of the U.S. Securities Act or an exemption therefrom and in each case
only in accordance with applicable state and foreign securities laws;

          4.      the Security Holder understands and agrees not to engage in
any hedging transactions involving any of the Pubco Securities unless such
transactions are in compliance with the provisions of the U.S. Securities Act
and in each case only in accordance with applicable state and provincial
securities laws;

--------------------------------------------------------------------------------

- 2 -

          5.      the Security Holder is acquiring the Pubco Securities for
investment only and not with a view to resale or distribution and, in
particular, it has no intention to distribute either directly or indirectly any
of the Pubco Securities in the United States or to U.S. Persons;

          6.      the Security Holder has not acquired the Pubco Securities as a
result of, and will not itself engage in, any directed selling efforts (as
defined in Regulation S under the U.S. Securities Act) in the United States in
respect of the Pubco Securities which would include any activities undertaken
for the purpose of, or that could reasonably be expected to have the effect of,
conditioning the market in the United States for the resale of any of the Pubco
Securities; provided, however, that the Security Holder may sell or otherwise
dispose of the Pubco Securities pursuant to registration thereof under the U.S.
Securities Act and any applicable state and provincial securities laws or under
an exemption from such registration requirements;

          7.      the statutory and regulatory basis for the exemption claimed
for the sale of the Pubco Securities, although in technical compliance with
Regulation S, would not be available if the offering is part of a plan or scheme
to evade the registration provisions of the U.S. Securities Act or any
applicable state and provincial securities laws;

          8.      except as set out in the Agreement, Pubco has not undertaken,
and will have no obligation, to register any of the Pubco Securities under the
U.S. Securities Act;

          9.      Pubco is entitled to rely on the acknowledgements, agreements,
representations and warranties and the statements and answers of the Security
Holder contained in the Agreement and this Certificate, and the Security Holder
will hold harmless Pubco from any loss or damage either one may suffer as a
result of any such acknowledgements, agreements, representations and/or
warranties made by the Security Holder not being true and correct;

          10.      the undersigned has been advised to consult their own
respective legal, tax and other advisors with respect to the merits and risks of
an investment in the Pubco Securities and, with respect to applicable resale
restrictions, is solely responsible (and Pubco is not in any way responsible)
for compliance with applicable resale restrictions;

          11.      the undersigned and the undersigned’s advisor(s) have had a
reasonable opportunity to ask questions of and receive answers from Pubco in
connection with the acquisition of the Pubco Securities under the Agreement, and
to obtain additional information, to the extent possessed or obtainable by Pubco
without unreasonable effort or expense;

          12.      the books and records of Pubco were available upon reasonable
notice for inspection, subject to certain confidentiality restrictions, by the
undersigned during reasonable business hours at its principal place of business
and that all documents, records and books in connection with the acquisition of
the Pubco Securities under the Agreement have been made available for inspection
by the undersigned, the undersigned’s attorney and/or advisor(s);

          13.      the undersigned:

  (a)

is knowledgeable of, or has been independently advised as to, the applicable
securities laws of the securities regulators having application in the
jurisdiction in which the undersigned is resident (the “International
Jurisdiction”) which would apply to the acquisition of the Pubco Securities;

--------------------------------------------------------------------------------

- 3 -

  (b)

the undersigned is acquiring the Pubco Securities pursuant to exemptions from
prospectus or equivalent requirements under applicable securities laws or, if
such is not applicable, the undersigned is permitted to acquire the Pubco
Securities under the applicable securities laws of the securities regulators in
the International Jurisdiction without the need to rely on any exemptions;

          (c)

the applicable securities laws of the authorities in the International
Jurisdiction do not require Pubco to make any filings or seek any approvals of
any kind whatsoever from any securities regulator of any kind whatsoever in the
International Jurisdiction in connection with the issue and sale or resale of
the Pubco Securities; and

          (d)

the acquisition of the Pubco Securities by the undersigned does not trigger:

          (i)

any obligation to prepare and file a prospectus or similar document, or any
other report with respect to such purchase in the International Jurisdiction; or

          (ii)

any continuous disclosure reporting obligation of Pubco in the International
Jurisdiction; and

the undersigned will, if requested by Pubco, deliver to Pubco a certificate or
opinion of local counsel from the International Jurisdiction which will confirm
the matters referred to in Sections 13(c) and 13(d) above to the satisfaction of
Pubco, acting reasonably;

          14.      the undersigned (i) is able to fend for itself in connection
with the acquisition of the Pubco Securities; (ii) has such knowledge and
experience in business matters as to be capable of evaluating the merits and
risks of its prospective investment in the Pubco Securities; and (iii) has the
ability to bear the economic risks of its prospective investment and can afford
the complete loss of such investment;

          15.      the undersigned is not aware of any advertisement of any of
the Pubco Securities and is not acquiring the Pubco Securities as a result of
any form of general solicitation or general advertising including
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar media or broadcast over radio or television, or
any seminar or meeting whose attendees have been invited by general solicitation
or general advertising;

          16.      except as set out in the Agreement, no Person has made to the
undersigned any written or oral representations:

  (a)

that any Person will resell or repurchase any of the Pubco Securities;

        (b)

that any Person will refund the purchase price of any of the Pubco Securities;

        (c)

as to the future price or value of any of the Pubco Securities; or

        (d)

that any of the Pubco Securities will be listed and posted for trading on any
stock exchange or automated dealer quotation system or that application has been
made to list and post any of the Pubco Securities on any stock exchange

--------------------------------------------------------------------------------

- 4 -

or automated dealer quotation system, except that currently certain market
makers make market in the common shares of Pubco on the OTC Bulletin Board;

          17.      none of the Pubco Securities are listed on any stock exchange
or automated dealer quotation system and, except as set out in the Agreement, no
representation has been made to the undersigned that any of the Pubco Securities
will become listed on any stock exchange or automated dealer quotation system,
except that currently certain market makers make market in the common shares of
Pubco on the OTC Bulletin Board;

          18.      the undersigned is outside the United States when receiving
and executing this Agreement and is acquiring the Pubco Securities as principal
for their own account, for investment purposes only, and not with a view to, or
for, resale, distribution or fractionalization thereof, in whole or in part, and
no other Person has a direct or indirect beneficial interest in the Pubco
Securities;

          19.      neither the SEC nor any other securities commission or
similar regulatory authority has reviewed or passed on the merits of the Pubco
Securities;

          20.      the Pubco Securities are not being acquired, directly or
indirectly, for the account or benefit of a U.S. Person or a Person in the
United States;

          21.      the undersigned acknowledges and agrees that Pubco shall
refuse to register any transfer of Pubco Securities not made in accordance with
the provisions of Regulation S, pursuant to registration under the U.S.
Securities Act, or pursuant to an available exemption from registration under
the U.S. Securities Act;

          22.      the undersigned understands and agrees that the Pubco
Securities will bear the following legend:

> > “THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE
> > TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN)
> > PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
> > AMENDED (THE “1933 ACT”).
> > 
> > NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE
> > 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY
> > NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS
> > DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS
> > OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
> > STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR
> > IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933
> > ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
> > LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE
> > CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED STATES” AND

--------------------------------------------------------------------------------

- 5 -

> > “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.”;

          23.      the address of the undersigned included herein is the sole
address of the undersigned as of the date of this certificate; and

          24.      the undersigned is the beneficial owner of the Priveco Shares
free and clear of all liens, charges and encumbrances of any kind whatsoever;

          25.      other than the Shareholder Agreement and the constating
documents of Priveco, there are no written instruments, buy-sell agreements,
registration rights or agreements, voting agreements or other agreements by and
between or among the undersigned or any other Person, imposing any restrictions
upon the transfer, prohibiting the transfer of or otherwise pertaining to the
Priveco Shares or the ownership thereof;

          26.      no Person has or will have any agreement or option or any
right capable at any time of becoming an agreement to purchase or otherwise
acquire the Priveco Shares or require the undersigned to sell, transfer, assign,
pledge, charge, mortgage or in any other way dispose of or encumber any of the
Priveco Shares other than under this Agreement; and

          27.      the undersigned waives all claims and actions connected with
the issuance of or rights attached to the Priveco Shares, including without
limitation, the benefit of any representations, warranties and covenants in
favour of the undersigned contained in any share purchase or subscription
agreement(s) for such Priveco Shares; and any registration, liquidation, or any
other rights by and between or among the undersigned and any other Person, which
may be triggered as a result of the consummation of the Transaction.

IN WITNESS WHEREOF, I have executed this Certificate of Non-U.S. Shareholder.

                                                                                                                                               
Date: __________________________________, _________     Signature          
Print Name           Title (if applicable)           Address      

--------------------------------------------------------------------------------

SCHEDULE 2B
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

CERTIFICATE OF U.S. SHAREHOLDER

In connection with the issuance of common stock (the “Pubco Shares”) and options
(the “Pubco Options”) of COUNTERPATH CORPORATION, a Nevada corporation
(“Pubco”), to the undersigned, pursuant to that certain Share Exchange Agreement
dated January 28, 2008 (the “Agreement”), among Pubco, Firsthand Technologies
Inc., a Ontario corporation (“Priveco”) and certain shareholders of Priveco as
set out in the Agreement (each, a “Selling Shareholder”). Capitalized terms used
but not otherwise defined in this Certificate shall have the meanings given to
such terms in the Agreement. The undersigned Security Holder hereby agrees,
acknowledges, represents and warrants that:

          1.      the undersigned satisfies one or more of the categories of
"Accredited Investors", as defined by Regulation D promulgated under the United
States Securities Act of 1933, as amended (the “U.S. Securities Act”), as
indicated below: (Please initial in the space provide those categories, if any,
of an "Accredited Investor" which the undersigned satisfies.)

_______   Category 1

An organization described in Section 501(c)(3) of the United States Internal
Revenue Code, a corporation, a Massachusetts or similar business trust or
partnership, not formed for the specific purpose of acquiring the Shares, with
total assets in excess of US $5,000,000.

   

_______   Category 2

A natural person whose individual net worth, or joint net worth with that
person's spouse, on the date of purchase exceeds US $1,000,000.

   

_______   Category 3

A natural person who had an individual income in excess of US $200,000 in each
of the two most recent years or joint income with that person's spouse in excess
of US $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year.

   

_______   Category 4

A "bank" as defined under Section (3)(a)(2) of the 1933 Act or savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the
Securities Act acting in its individual or fiduciary capacity; a broker dealer
registered pursuant to Section 15 of the Securities Exchange Act of 1934 (United
States); an insurance company as defined in Section 2(13) of the 1933 Act; an
investment company registered under the Investment Company Act of 1940 (United
States) or a business development company as defined in Section 2(a)(48) of such
Act; a Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment Act
of 1958 (United States); a plan with total assets in excess of $5,000,000
established and maintained by a state, a political subdivision thereof, or an
agency or instrumentality of a state or a political subdivision thereof, for the
benefit of its employees; an employee benefit plan within the meaning of the
Employee Retirement Income Security Act of 1974 (United States) whose investment
decisions are made by a plan fiduciary, as defined in Section 3(21) of such Act,
which is either a bank,

--------------------------------------------------------------------------------

- 2 -

savings and loan association, insurance company or registered investment
adviser, or if the employee benefit plan has total assets in excess of
$5,000,000, or, if a self-directed plan, whose investment decisions are made
solely by persons that are accredited investors.

   

_______   Category 5

A private business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940 (United States).

   

_______    Category 6

A director or executive officer of the Company.

   

_______   Category 7

A trust with total assets in excess of $5,000,000, not formed for the specific
purpose of acquiring the Shares, whose purchase is directed by a sophisticated
person as described in Rule 506(b)(2)(ii) under the 1933 Act.

   

_______   Category 8

An entity in which all of the equity owners satisfy the requirements of one or
more of the foregoing categories.

Note that for any of the Security Holders claiming to satisfy one of the above
categories of Accredited Investor may be required to supply Pubco with a balance
sheet, prior years' federal income tax returns or other appropriate
documentation to verify and substantiate the undersigned's status as an
Accredited Investor.

If the Security Holder is an entity which initialled Category 8 in reliance upon
the Accredited Investor categories above, state the name, address, total
personal income from all sources for the previous calendar year, and the net
worth (exclusive of home, home furnishings and personal automobiles) for each
equity owner of the said entity:

__________________________________________________________________________________

          2.      none of the Pubco Securities have been or will be registered
under the U.S. Securities Act, or under any state securities or “blue sky” laws
of any state of the United States, and may not be offered or sold in the United
States or, directly or indirectly, to U.S. Persons, as that term is defined in
Regulation S, except in accordance with the provisions of Regulation S or
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the U.S. Securities Act and in compliance with any
applicable state and foreign securities laws;

          3.      the Security Holder understands and agrees that offers and
sales of any of the Pubco Securities shall be made only in compliance with the
registration provisions of the U.S. Securities Act or an exemption therefrom and
in each case only in accordance with applicable state and foreign securities
laws;

          4.      the Security Holder understands and agrees not to engage in
any hedging transactions involving any of the Pubco Securities unless such
transactions are in compliance with the provisions of the U.S. Securities Act
and in each case only in accordance with applicable state and provincial
securities laws;

          5.      the Security Holder is acquiring the Pubco Securities for
investment only and not with a view to resale or distribution and, in
particular, it has no intention to distribute either directly or indirectly any
of the Pubco Securities in the United States or to U.S. Persons;

          6.      except as set out in the Agreement, Pubco has not undertaken,
and will have no obligation, to register any of the Pubco Securities under the
U.S. Securities Act;

--------------------------------------------------------------------------------

- 3 -

          7.      Pubco is entitled to rely on the acknowledgements, agreements,
representations and warranties and the statements and answers of the Security
Holder contained in the Agreement and this Certificate, and the Security Holder
will hold harmless Pubco from any loss or damage either one may suffer as a
result of any such acknowledgements, agreements, representations and/or
warranties made by the Security Holder not being true and correct;

          8.      the undersigned has been advised to consult their own
respective legal, tax and other advisors with respect to the merits and risks of
an investment in the Pubco Securities and, with respect to applicable resale
restrictions, is solely responsible (and Pubco is not in any way responsible)
for compliance with applicable resale restrictions;

          9.     the undersigned and the undersigned’s advisor(s) have had a
reasonable opportunity to ask questions of and receive answers from Pubco in
connection with the acquisition of the Pubco Securities under the Agreement, and
to obtain additional information, to the extent possessed or obtainable by Pubco
without unreasonable effort or expense;

          10.      the books and records of Pubco were available upon reasonable
notice for inspection, subject to certain confidentiality restrictions, by the
undersigned during reasonable business hours at its principal place of business
and that all documents, records and books in connection with the acquisition of
the Pubco Securities under the Agreement have been made available for inspection
by the undersigned, the undersigned’s attorney and/or advisor(s);

          11.      the undersigned (i) is able to fend for itself in connection
with the acquisition of the Pubco Securities; (ii) has such knowledge and
experience in business matters as to be capable of evaluating the merits and
risks of its prospective investment in the Pubco Securities; and (iii) has the
ability to bear the economic risks of its prospective investment and can afford
the complete loss of such investment;

          12.      the undersigned is not aware of any advertisement of any of
the Pubco Securities and is not acquiring the Pubco Securities as a result of
any form of general solicitation or general advertising including
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar media or broadcast over radio or television, or
any seminar or meeting whose attendees have been invited by general solicitation
or general advertising;

          13.      except as set out in the Agreement, no person has made to the
undersigned any written or oral representations:

  (a)

that any person will resell or repurchase any of the Pubco Securities;

        (b)

that any person will refund the purchase price of any of the Pubco Securities;

        (c)

as to the future price or value of any of the Pubco Securities; or

        (d)

that any of the Pubco Securities will be listed and posted for trading on any
stock exchange or automated dealer quotation system or that application has been
made to list and post any of the Pubco Securities on any stock exchange or
automated dealer quotation system, except that currently certain market makers
make market in the common shares of Pubco on the OTC Bulletin Board;

--------------------------------------------------------------------------------

- 4 -

          14.      none of the Pubco Securities are listed on any stock exchange
or automated dealer quotation system and, except as set out in the Agreement, no
representation has been made to the undersigned that any of the Pubco Securities
will become listed on any stock exchange or automated dealer quotation system,
except that currently certain market makers make market in the common shares of
Pubco on the OTC Bulletin Board;

          15.      the undersigned is acquiring the Pubco Securities as
principal for their own account, for investment purposes only, and not with a
view to, or for, resale, distribution or fractionalization thereof, in whole or
in part, and no other person has a direct or indirect beneficial interest in the
Pubco Securities;

          16.      neither the SEC nor any other securities commission or
similar regulatory authority has reviewed or passed on the merits of the Pubco
Securities;

          17.      the undersigned acknowledges and agrees that Pubco shall
refuse to register any transfer of Pubco Securities not made in accordance with
the provisions of Regulation S, pursuant to registration under the U.S.
Securities Act, or pursuant to an available exemption from registration under
the U.S. Securities Act;

          18.      the undersigned understands and agrees that the Pubco
Securities will bear the following legend:

> > “NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE
> > UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY
> > U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR
> > SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO
> > U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER
> > THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933
> > ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
> > SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE
> > ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. “UNITED STATES”
> > AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.”;

          19.      the address of the undersigned included herein is the sole
address of the undersigned as of the date of this certificate.;

          20.      the undersigned is the beneficial owner of the Priveco Shares
free and clear of all liens, charges and encumbrances of any kind whatsoever;

          21.      other than the Shareholder Agreement and the constating
documents of Priveco, there are no written instruments, buy-sell agreements,
registration rights or agreements, voting agreements or other agreements by and
between or among the undersigned or any other Person, imposing any restrictions
upon the transfer, prohibiting the transfer of or otherwise pertaining to the
Priveco Shares or the ownership thereof;

--------------------------------------------------------------------------------

- 5 -

          22.      no Person has or will have any agreement or option or any
right capable at any time of becoming an agreement to purchase or otherwise
acquire the Priveco Shares or require the undersigned to sell, transfer, assign,
pledge, charge, mortgage or in any other way dispose of or encumber any of the
Priveco Shares other than under this Agreement; and

          23.      the undersigned waives all claims and actions connected with
the issuance of or rights attached to the Priveco Shares, including without
limitation, the benefit of any representations, warranties and covenants in
favour of the undersigned contained in any share purchase or subscription
agreement(s) for such Priveco Shares; and any registration, liquidation, or any
other rights by and between or among the undersigned and any other Person, which
may be triggered as a result of the consummation of the Transaction.

IN WITNESS WHEREOF, I have executed this Certificate of U.S. Shareholder.

                                                                                                                                               
Date: __________________________________, _________     Signature          
Print Name           Title (if applicable)           Address      

--------------------------------------------------------------------------------

SCHEDULE 3
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

DIRECTORS AND OFFICERS OF PRIVECO

Directors:   David Hattey   Ken Millard   Jane Mowat   Leo Lax   Will Jin   Roch
Charbonneau   Alain Mouttham       Officers:   Name Office David Hattey
President and Chief Executive Officer Mike Kelly Chief Financial Officer Alain
Mouttham Chief Technology Officer

--------------------------------------------------------------------------------

SCHEDULE 4
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

DIRECTORS AND OFFICERS OF PUBCO

Directors:   Terry Matthews   Owen Matthews   Mark Bruk   Greg Pelling   Donovan
Jones   Chris Cooper   Larry Timlick       Officers:   Name Office Greg Pelling
Chief Executive Officer Donovan Jones President and Chief Operating Officer
David Karp Chief Financial Officer Jason Fischl Chief Technology Officer

--------------------------------------------------------------------------------

SCHEDULE 5
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

FORM OF PUBCO OPTION

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION
S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933
ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE
OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN
EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED
BY REGULATION S UNDER THE 1933 ACT.

STOCK OPTION AND SUBSCRIPTION AGREEMENT
(for Non-U.S. Persons)

THIS STOCK OPTION AND SUBSCRIPTION AGREEMENT is entered into as of the ____ day
of ____________, 200__ (the "Date of Grant").

BETWEEN:

> > COUNTERPATH CORPORATION (the "Company"), who has a business address at Suite
> > 300, One Bentall Centre, 505 Burrard Street, Vancouver, British Columbia,
> > Canada V7X 1M3.

AND:

> > ___________________________________ (the "Optionee") whose address is
> > __________________________________________
> > .

RECITALS

WHEREAS:

A.                     The Optionee is a director, officer, consultant or
employee of the Company or the Company’s subsidiary, CounterPath Solutions R&D
Inc.;

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- 2 -

B.                     The Board of Directors of the Company (the “Board”) has
approved and adopted the 2005 Amended and Restated Stock Option Plan (the
“Plan”), pursuant to which the Board is authorized to grant to employees and
other selected persons stock options to purchase common shares of the Company;
and

C.                     The Board has authorized the grant to the Optionee of
stock options to purchase a total of ____________________(___________) common
shares of the Company.

NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of other good and
valuable consideration and the sum of One ($1.00) Dollar now paid by the
Optionee to the Company (the receipt and sufficiency whereof is hereby
acknowledged), it is hereby agreed by and between the parties as follows:

1.1                   In this Agreement, the following terms shall have the
following meanings:

  (a)

"Common Stock" means the shares of common stock of the Company;

        (b)

"Exercise Payment" means the amount of money equal to the Exercise Price
multiplied by the number of Optioned Shares specified in the Notice of Exercise;

        (c)

"Exercise Price" means $_____;

        (d)

"Expiry Date" means ___________________;

        (e)

"Notice of Exercise" means a notice in writing addressed to the Company at its
address first recited (or such other address of the Company as may from time to
time be notified to the Optionee in writing), substantially in the form attached
as Exhibit "A" hereto, which notice shall specify therein the number of Optioned
Shares in respect of which the Options are being exercised;

        (f)

"Options" means the irrevocable right and option to purchase, from time to time,
all, or any part of the Optioned Shares granted to the Optionee by the Company
pursuant to Section 1.3 of this Agreement;

        (g)

"Optioned Shares" means the shares of Common Stock, subject to the Options;

        (h)

"Securities" means, collectively, the Options and the Optioned Shares;

        (i)

"Shareholders" means holders of record of the shares of Common Stock;

        (j)

"U.S. Person" shall have the meaning ascribed thereto in Regulation S under the
1933 Act, and for the purpose of the Agreement includes any person in the United
States; and

        (k)

"Vested Options" means the Options that have vested in accordance with Section
1.4 of this Agreement.

1.2                   Capitalized terms not otherwise defined herein shall have
the meanings ascribed thereto in the Plan.

1.3                   The Company agrees to offer to the Optionee the option to
purchase, upon the terms and conditions set forth herein and in the Plan,
Options to purchase a total of _____________________ (___________) Optioned
Shares at the Exercise Price. The Company and the Optionee have agreed that the
grant of the Options pursuant to this Agreement will satisfy the Company’s
obligation to grant stock

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- 3 -

options as set out in the Share Exchange Agreement, dated January 28, 2008 (the
“Share Exchange Agreement”), entered into among the Company, Firsthand
Technologies Inc., Covington Venture Fund Inc., Skypoint II G.P. Co. Inc., as
nominee, Skypoint II, G.P. Co. (U.S.) Inc., as nominee, and BDC Capital Inc. and
the Optionee agrees to release the Company with respect to any claim with
respect to the Company’s obligation to grant stock options as set out in the
Share Exchange Agreement.

1.4                   The Options may be exercised after vesting and only in
accordance with the following schedule:

  (a)

as of the Date of Grant, <> Options shall vest immediately; and

        (b)

commencing on Date of Grant, the Options shall vest with respect to <> Options
per month for <> months until the Options are fully vested.

1.5                   The Options shall, at 5:00 p.m. (Vancouver time) on the
Expiry Date, forthwith expire and be of no further force or effect whatsoever.

1.6                   Vested Options shall terminate, to the extent not
previously exercised, upon the occurrence of the first of the following events:

  (a)

<> years from the Date of Grant;

        (b)

the date of an Optionee's termination of employment or contractual relationship
with the Company or any Related Corporation (as defined in the Plan) for cause
(as determined in the sole discretion of the Plan Administrator, acting
reasonably) or the date of resignation by an Optionee from the Optionee’s
employment or contractual relationship with the Company or any Related Company;

        (c)

the expiration of one (1) year from the date of the death of the Optionee, or
the expiration of one (1) year from termination of an Optionee's employment or
contractual relationship by reason of Disability (as defined in Section 5(g) of
the Plan); or

        (d)

the expiration of three (3) months from the date of an Optionee's termination of
employment or contractual relationship with the Company or any Related
Corporation for any reason whatsoever other than cause, death or Disability.

Each unvested Option granted pursuant hereto shall terminate immediately upon
termination of or resignation from the Optionee's employment or contractual
relationship with the Company for any reason whatsoever unless vesting is
accelerated in accordance with Section 5.1(f) of the Plan.

1.7                   Subject to compliance with any applicable securities laws,
the Options shall be exercisable, in full or in part, at any time after vesting,
until termination; provided, however, that any Optionee who is subject to the
reporting and liability provisions of Section 16 of the Securities Exchange Act
of 1934 with respect to the Common Stock shall be precluded from selling,
transferring or otherwise disposing of any Common Stock underlying any Options
during the six (6) months immediately following the grant of that Option. If
less than all of the shares included in the vested portion of any Options are
purchased, the remainder may be purchased at any subsequent time prior to the
Expiry Date. No portion of any Options for less than fifty (50) shares (as
adjusted pursuant to Section 5.1(m) of the Plan) may be exercised; provided,
that if the vested portion of any Options is less than fifty (50) shares, it may
be exercised with respect to all shares for which it is vested. Only whole
shares may be issued pursuant to the exercise of any Options, and to the extent
that any Options covers less than one (1) share, it is unexercisable.

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- 4 -

Each exercise of the Options shall be by means of delivery of a Notice of
Exercise (which may be in the form attached hereto as Exhibit A) to the
Secretary of the Company at its principal executive office, specifying the
number of shares of Common Stock to be purchased and accompanied by payment in
cash by certified check or cashier's check in the amount of the full exercise
price for the Common Stock to be purchased. In addition to payment in cash by
certified check or cashier's check, an Optionee or transferee of the Options may
pay for all or any portion of the aggregate exercise price by complying with one
or more of the following alternatives:

  (a)

by delivering a properly executed Notice of Exercise together with irrevocable
instructions to a broker promptly to sell or margin a sufficient portion of the
Common Stock and deliver directly to the Company the amount of sale or margin
loan proceeds to pay the exercise price; or

        (b)

by complying with any other payment mechanism approved by the Plan Administrator
at the time of exercise.

It is a condition precedent to the issuance of Optioned Shares that the Optionee
execute and/or deliver to the Company all documents and withholding taxes
required in accordance with Section 5.1 of the Plan.

1.8                   Nothing in this Agreement shall obligate the Optionee to
purchase any Optioned Shares except those Optioned Shares in respect of which
the Optionee shall have exercised the Options in the manner provided in this
Agreement.

1.9                   The terms of the Options are subject to the provisions of
the Plan, as the same may from time to time be amended, and any inconsistencies
between this Agreement and the Plan, as the same may be from time to time
amended, shall be governed by the provisions of the Plan, a copy of which has
been delivered to the Optionee, and which is available for inspection at the
principal offices of the Company.

2.                     Acknowledgements of the Optionee

2.1                   The Optionee acknowledges and agrees that:

  (a)

none of the Options or the Optioned Shares have been registered under the 1933
Act or under any state securities or "blue sky" laws of any state of the United
States, and, unless so registered, may not be offered or sold in the United
States or, directly or indirectly, to U.S. Persons, except in accordance with
the provisions of Regulation S, pursuant to an effective registration statement
under the 1933 Act, or pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the 1933 Act and in each case only
in accordance with applicable state securities laws;

        (b)

the Company has not undertaken, and will have no obligation, to register any of
the Securities under the 1933 Act;

        (c)

the Optionee has received and carefully read this Agreement and the public
information which has been filed with the Securities and Exchange Commission
(the "SEC") in compliance or intended compliance with applicable securities
legislation (collectively, the "Company Information");

        (d)

the decision to execute this Agreement and acquire the Securities hereunder has
not been based upon any oral or written representation as to fact or otherwise
made by or on behalf of the Company, and such decision is based entirely upon a
review of the Company Information (the receipt of which is hereby acknowledged);

--------------------------------------------------------------------------------

- 5 -

  (e)

no securities commission or similar regulatory authority has reviewed or passed
on the merits of the Securities;

        (f)

there is no government or other insurance covering the Securities;

        (g)

there are risks associated with an investment in the Securities;

        (h)

the Company has advised the Optionee that the Company is relying on an exemption
from the requirements to provide the Optionee with a prospectus and to sell the
Securities through a person registered to sell securities under the Securities
Act (British Columbia) (the "B.C. Act") and, as a consequence of acquiring the
Securities pursuant to this exemption, certain protections, rights and remedies
provided by the B.C. Act, including statutory rights of rescission or damages,
will not be available to the Optionee;

        (i)

the Optionee has not acquired the Securities as a result of, and will not itself
engage in, any "directed selling efforts" (as defined in Regulation S under the
1933 Act) in the United States in respect of the Securities which would include
any activities undertaken for the purpose of, or that could reasonably be
expected to have the effect of, conditioning the market in the United States for
the resale of the Securities; provided, however, that the Optionee may sell or
otherwise dispose of the Securities pursuant to registration thereof under the
1933 Act and any applicable state and provincial securities laws or under an
exemption from such registration requirements;

        (j)

the Optionee and the Optionee's advisor(s) (if applicable) have had a reasonable
opportunity to ask questions of and receive answers from the Company in
connection with the distribution of the Securities hereunder, and to obtain
additional information, to the extent possessed or obtainable without
unreasonable effort or expense, necessary to verify the accuracy of the
information about the Company;

        (k)

the books and records of the Company were available upon reasonable notice for
inspection, subject to certain confidentiality restrictions, by the Optionee
during reasonable business hours at its principal place of business, and all
documents, records and books in connection with the distribution of the
Securities hereunder have been made available for inspection by the Optionee,
the Optionee's attorney and/or advisor(s) (if applicable);

        (l)

the Company is entitled to rely on the representations and warranties and the
statements and answers of the Optionee contained in this Agreement;

        (m)

the Optionee will indemnify and hold harmless the Company and, where applicable,
its directors, officers, employees, agents, advisors and shareholders, from and
against any and all loss, liability, claim, damage and expense whatsoever
(including, but not limited to, any and all fees, costs and expenses whatsoever
reasonably incurred in investigating, preparing or defending against any claim,
lawsuit, administrative proceeding or investigation whether commenced or
threatened) arising out of or based upon any representation or warranty of the
Optionee contained herein or in any document furnished by the Optionee to the
Company in connection herewith being untrue in any material respect or any
breach or failure by the Optionee to comply with any covenant or agreement made
by the Optionee to the Company in connection therewith;

        (n)

none of the Securities are listed on any stock exchange or automated dealer
quotation system and no representation has been made to the Optionee that any of
the Securities

--------------------------------------------------------------------------------

- 6 -

 

will become listed on any stock exchange or automated dealer quotation system;
except that currently certain market makers make market in the common shares of
the Company on the OTC Bulletin Board service of the National Association of
Securities Dealers, Inc.;

          (o)

in addition to resale restrictions imposed under U.S. securities laws, there are
additional restrictions on the Optionee's ability to resell the Securities under
the B.C. Act and Multilateral Instrument 45-102 adopted by the British Columbia
Securities Commission;

          (p)

the Company will refuse to register any transfer of the Securities not made in
accordance with the provisions of Regulation S, pursuant to an effective
registration statement under the 1933 Act or pursuant to an available exemption
from the registration requirements of the 1933 Act and in accordance with
applicable state and provincial securities laws;

          (q)

the statutory and regulatory basis for the exemption claimed for the offer of
the Securities, although in technical compliance with Regulation S, would not be
available if the offering is part of a plan or scheme to evade the registration
provisions of the 1933 Act or any applicable state and provincial securities
laws;

          (r)

the Optionee has been advised to consult the Optionee's own legal, tax and other
advisors with respect to the merits and risks of an investment in the Securities
and with respect to applicable resale restrictions, and it is solely responsible
(and the Company is not in any way responsible) for compliance with:

          (i)

any applicable laws of the jurisdiction in which the Optionee is resident in
connection with the distribution of the Securities hereunder, and

          (ii)

applicable resale restrictions; and

          (s)

this Agreement is not enforceable by the Optionee unless it has been accepted by
the Company.

3.                     Representations, Warranties and Covenants of the Optionee

3.1                   The Optionee hereby represents and warrants to and
covenants with the Company (which representations, warranties and covenants
shall survive the closing) that:

  (a)

the Optionee is an employee of the Company;

        (b)

the Optionee has the legal capacity and competence to enter into and execute
this Agreement and to take all actions required pursuant hereto;

        (c)

the Optionee has received and carefully read this Agreement;

        (d)

the Optionee has duly executed and delivered this Agreement and it constitutes a
valid and binding agreement of the Optionee enforceable against the Optionee in
accordance with its terms;

        (e)

the Optionee is not acquiring the Securities for the account or benefit of,
directly or indirectly, any U.S. Person;

        (f)

the Optionee is not a U.S. Person;

        (g)

the Optionee is resident in the jurisdiction set out on page 1 of this
Agreement;

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- 7 -

  (h)

the acquisition of the Securities by the Optionee as contemplated in this
Agreement complies with or is exempt from the applicable securities legislation
of the jurisdiction of residence of the Optionee;

        (i)

the Optionee is acquiring the Securities for investment only and not with a view
to resale or distribution and, in particular, it has no intention to distribute
either directly or indirectly any of the Securities in the United States or to
U.S. Persons;

        (j)

the Optionee is outside the United States when receiving and executing this
Agreement and is acquiring the Securities as principal for the Optionee's own
account, for investment purposes only, and not with a view to, or for, resale,
distribution or fractionalisation thereof, in whole or in part, and no other
person has a direct or indirect beneficial interest in such Securities;

        (k)

the Optionee is not an underwriter of, or dealer in, the common shares of the
Company, nor is the Optionee participating, pursuant to a contractual agreement
or otherwise, in the distribution of the Securities;

        (l)

the Optionee (i) has adequate net worth and means of providing for his/her/its
current financial needs and possible personal contingencies, (ii) has no need
for liquidity in this investment, and (iii) is able to bear the economic risks
of an investment in the Securities for an indefinite period of time, and can
afford the complete loss of such investment;

        (m)

the Optionee is aware that an investment in the Company is speculative and
involves certain risks, including the possible loss of the investment, and the
Optionee has carefully read and considered the matters set forth under the
caption "Risk Factors" appearing in the Company's various disclosure documents,
filed with the SEC;

        (n)

the Optionee has the requisite knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of the
investment in the Securities and the Company;

        (o)

the Optionee understands and agrees that the Company and others will rely upon
the truth and accuracy of the acknowledgements, representations and agreements
contained in this Agreement, and agrees that if any of such acknowledgements,
representations and agreements are no longer accurate or have been breached, the
Optionee shall promptly notify the Company;

        (p)

the Optionee acknowledges that the Optionee has not acquired the Securities as a
result of, and will not itself engage in, any "directed selling efforts" (as
defined in Regulation S under the 1933 Act) in the United States in respect of
the Securities which would include any activities undertaken for the purpose of,
or that could reasonably be expected to have the effect of, conditioning the
market in the United States for the resale of the Securities; provided, however,
that the Optionee may sell or otherwise dispose of the Securities pursuant to
registration of the Securities pursuant to the 1933 Act and any applicable state
and provincial securities laws or under an exemption from such registration
requirements and as otherwise provided herein;

        (q)

the Optionee has made an independent examination and investigation of an
investment in the Securities and the Company and has depended on the advice of
its legal and financial advisors and agrees that the Company will not be
responsible in anyway whatsoever for the Optionee's decision to invest in the
Securities and the Company;

--------------------------------------------------------------------------------

- 8 -

  (r)

the Optionee understands and agrees that none of the Options or the Optioned
Securities have been or will be registered under the 1933 Act, or under any
state securities or “blue sky” laws of any state of the United States, and,
unless so registered, may not be offered or sold except in accordance with the
provisions of Regulation S, pursuant to an effective registration statement
under the 1933 Act, or pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the 1933 Act and in each case only
in accordance with applicable state securities laws;

          (s)

it understands and agrees that the Company will refuse to register any transfer
of the Optioned Securities not made in accordance with the provisions of
Regulation S, pursuant to an effective registration statement under the 1933 Act
or pursuant to an available exemption from, or in a transaction not subject to,
the registration requirements of the 1933 Act;

          (t)

the Optionee is not aware of any advertisement of any of the Securities and is
not acquiring the Securities as a result of any form of general solicitation or
general advertising including advertisements, articles, notices or other
communications published in any newspaper, magazine or similar media or
broadcast over radio or television, or any seminar or meeting whose attendees
have been invited by general solicitation or general advertising;

          (u)

no person has made to the Optionee any written or oral representations:

          (i)

that any person will resell or repurchase any of the Securities;

          (ii)

that any person will refund the purchase price of any of the Securities; or

          (iii)

as to the future price or value of any of the Securities; and

          (v)

if the Optionee is a consultant of the Company, the Optionee has entered into a
written consulting agreement with the Company or a related entity of the Company
and spends or will spend a significant amount of time and attention on the
affairs and business of the Company or such related entity.

4.                     Acknowledgement and Waiver

4.1                   The Optionee has acknowledged that the decision to
purchase the Securities was solely made on the basis of publicly available
information contained in the Company Information. The Optionee hereby waives, to
the fullest extent permitted by law, any rights of withdrawal, rescission or
compensation for damages to which the Optionee might be entitled in connection
with the distribution of any of the Securities.

5.                     Legending of Subject Securities

5.1                   The Optionee hereby acknowledges that that upon the
issuance thereof, and until such time as the same is no longer required under
the applicable securities laws and regulations, the certificates representing
any of the Securities will bear a legend in substantially the following form:

> > THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE
> > TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN)
> > PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS

--------------------------------------------------------------------------------

- 9 -

> > AMENDED (THE "1933 ACT"). NONE OF THE SECURITIES REPRESENTED HEREBY HAVE
> > BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND,
> > UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN
> > THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN
> > ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT
> > TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN
> > AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
> > REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN
> > ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING
> > TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
> > COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS
> > DEFINED BY REGULATION S UNDER THE 1933 ACT.

5.2                   The Optionee hereby acknowledges and agrees to the Company
making a notation on its records or giving instructions to the registrar and
transfer agent of the Company in order to implement the restrictions on transfer
set forth and described in this Agreement.

6.                     Costs

6.1                   The Optionee acknowledges and agrees that all costs and
expenses incurred by the Optionee (including any fees and disbursements of any
special counsel retained by the Optionee) relating to the acquisition of the
Securities shall be borne by the Optionee.

7.                     Governing Law

7.1                   This Agreement is governed by the laws of the Province of
British Columbia and the federal laws of Canada applicable therein. The Optionee
irrevocably attorns to the jurisdiction of the courts of the Province of British
Columbia.

8.                     Survival

8.1                   This Agreement, including without limitation the
representations, warranties and covenants contained herein, shall survive and
continue in full force and effect and be binding upon the parties hereto
notwithstanding the completion of the purchase of the shares underlying the
Options by the Optionee pursuant hereto.

9.                     Assignment

9.1                   This Agreement is not transferable or assignable.

10.                   Counterparts and Electronic Means

10.1                 This Agreement may be executed in several counterparts,
each of which will be deemed to be an original and all of which will together
constitute one and the same instrument. Delivery of an executed copy of this
Agreement by electronic facsimile transmission or other means of electronic
communication capable of producing a printed copy will be deemed to be execution
and delivery of this Agreement as of the date first above written.

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- 10 -

11.                   Severability

11.1                 The invalidity or unenforceability of any particular
provision of this Agreement shall not affect or limit the validity or
enforceability of the remaining provisions of this Agreement.

12.                   Entire Agreement

12.1                 Except as expressly provided in this Agreement and in the
agreements, instruments and other documents contemplated or provided for herein,
this Agreement is the only agreement between the Optionee and the Company with
respect to the Options, and this Agreement and the Plan supersede all prior and
contemporaneous oral and written statements and representations and contain the
entire agreement between the parties with respect to the Options.

13.                   Effectiveness

13.1                 This Agreement shall be deemed to be effective following
the delivery by the Optionee to the Company of two fully executed copies of this
Agreement.

IN WITNESS WHEREOF the parties hereto have duly executed this Agreement as of
the date first above written.

COUNTERPATH CORPORATION

By:        ______________________________________
              Authorized Signatory

EXECUTED by )   ________________________________________ in )   the presence of:
)     )   Signature )     ) [print name]   )   Print Name )     )   Address )  
  )     )     )   Occupation )  

--------------------------------------------------------------------------------

- 11 -

EXHIBIT A

TO: CounterPath Corporation   Suite 300, One Bentall Centre, 505 Burrard Street
  Vancouver, British Columbia   Canada V7X 1M3

Notice of Exercise

This Notice of Election to Exercise shall constitute proper notice pursuant to
Section 5.1(h) of CounterPath Corporation's (the "Company") 2005 Amended and
Restated Stock Option Plan (the "Plan") and Section 1.6 of that certain Stock
Option Agreement (the "Agreement") dated as of ___________________, between the
Company and the undersigned. The undersigned hereby elects to exercise
Optionee's option to purchase____________________shares of the common stock of
the Company at a price of $______ per share, for aggregate consideration of
$____________, on the terms and conditions set forth in the Agreement and the
Plan. Such aggregate consideration, in the form specified in Section 1.6 of the
Agreement, accompanies this notice.

The Optionee hereby represents and warrants that all representations and
warranties set out in the Agreement are true as of the date of the exercise of
this Option.

The Optionee hereby directs the Company to issue, register and deliver the
certificates representing the shares as follows:

Registration Information:   Delivery Instructions:             Name to appear on
certificates   Name             Address   Address                            
Telephone Number

DATED at ____________________________________, the ____ day of ______________,
_______.

      (Name of Optionee – Please type or print)           (Signature and, if
applicable, Office)           (Address of Optionee)           (City, State, and
Zip Code of Optionee)           (Fax Number)

--------------------------------------------------------------------------------

SCHEDULE 6
TO THE SHARE EXCHANGE AGREEMENT
AMONG COUNTERPATH CORPORATION, FIRSTHAND TECHNOLOGIES INC. AND
THE SELLING SHAREHOLDERS AS SET OUT IN THE SHARE EXCHANGE
AGREEMENT

PIGGYBACK REGISTRATION RIGHTS

In connection with the issuance of common stock (the “Pubco Shares”) of
COUNTERPATH CORPORATION, a Nevada corporation (“Pubco”), pursuant to that
certain Share Exchange Agreement dated January 28, 2008 (the “Agreement”), among
Pubco, Firsthand Technologies Inc., a Ontario corporation (“Priveco”) and
certain shareholders of Priveco as set out in the Agreement (each, a “Selling
Shareholder”). Capitalized terms used but not otherwise defined in this Schedule
shall have the meanings given to such terms in the Agreement. Pubco acknowledges
and agrees in favour of each Priveco Shareholder as follows:

1.1.                       If Pubco determines to proceed with the preparation
and filing with the Securities and Exchange Commission (the “SEC”) of a
registration statement (the "Registration Statement") relating to an offering
for its own account or the account of others under the United States Securities
Act of 1933, as amended (the “1933 Act”), of any shares of its common stock,
other than on Form S-4 or Form S-8 (each as promulgated under the 1933 Act) or
its then equivalents relating to equity securities issuable in connection with
stock options or other employee benefit plans, Pubco shall send to the Priveco
Shareholders written notice of such determination and, if within thirty (30)
days after receipt of such notice, any Priveco Shareholder(s) shall so request
in writing, Pubco will cause the registration under the 1933 Act of the Pubco
Shares issued to the Priveco Shareholders pursuant to the Agreement (the
"Registrable Securities"), provided that if at any time after giving written
notice of its intention to register any of its shares of common stock and prior
to the effective date of the registration statement filed in connection with
such registration, Pubco shall determine for any reason not to register or to
delay registration of such shares, Pubco may, at its election, give written
notice of such determination to the Priveco Shareholders and, thereupon, (i) in
the case of a determination not to register, shall be relieved of its obligation
to register the Registrable Securities in connection with such registration, and
(ii) in the case of a determination to delay registering, shall be permitted to
delay registering the Registrable Securities for the same period as the delay in
registering such other shares. Pubco shall include in such registration
statement all or any part of the Registrable Securities. Notwithstanding any
other provision herein, if Pubco receives a comment from the SEC which cannot be
reasonably resolved by Pubco using its commercially reasonable best efforts and
which effectively results in Pubco having to reduce the number of shares of
common stock being registered on such Registration Statement, then Pubco may, in
its sole discretion, reduce on a pro rata basis along with all other shares
being registered the number of Registrable Securities to be included in such
Registration Statement.

1.2.                       In connection with each Registration Statement
described in Section 1.1 hereof, the Priveco Shareholders will furnish to Pubco
in writing such information and representation letters with respect to itself
and the proposed distribution by it as reasonably shall be necessary in order to
assure compliance with federal and applicable state securities laws. Pubco may
require the Priveco Shareholders to furnish to Pubco a certified statement as to
the number of shares of

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common stock beneficially owned by the Priveco Shareholders and the name of the
person thereof that has voting and dispositive control over the Registrable
Securities. Failure by any Priveco Shareholder to provide any such information,
letters or statement shall not affect the registration of the Registrable
Securities held by those Priveco Shareholders who have provided such
information, letters or statement.

1.3.                       All fees and expenses incident to the performance of
or compliance with the filing of the Registration Statement shall be borne by
Pubco whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the OTC Bulletin Board or other exchange or quotation
service on which the common stock of Pubco is then listed for trading, and (B)
in compliance with applicable state securities or Blue Sky laws), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the
Registrable Securities included in the Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for
Pubco, (v) 1933 Act liability insurance, if Pubco so desires such insurance, and
(vi) fees and expenses of all other persons retained by Pubco in connection with
the filing of the Registration Statement. In addition, Pubco shall be
responsible for all of its internal expenses incurred in connection with the
filing of the Registration Statement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange, if applicable. In no event shall Pubco be responsible for
any broker or similar commissions or, except to the extent provided for
hereunder, any legal fees or other costs of the Priveco Shareholders.

1.4.                       Pubco shall, notwithstanding any termination of the
Agreement, indemnify and hold harmless the Priveco Shareholders, and if
applicable, its officers, directors, agents and employees, and each person who
controls the Priveco Shareholders (within the meaning of Section 15 of the 1933
Act or Section 20 of the United States Securities Exchange Act of 1934 (the
“1934 Act”)) and the officers, directors, agents and employees of each such
controlling person, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, costs (including,
without limitation, reasonable attorneys’ fees) and expenses (collectively,
"Losses"), as incurred, arising out of or relating to any untrue or alleged
untrue statement of a material fact contained in the Registration Statement, or
in any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or relating to any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except to the extent, but only to the extent, that such untrue
statements or omissions (i) are based solely upon information regarding the
Priveco Shareholders furnished in writing to Pubco by the Priveco Shareholders
expressly for use therein, or to the extent that such information relates to the
Priveco Shareholders or the Priveco Shareholders’ proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by the Priveco Shareholders expressly for use in the Registration
Statement, or in any amendment or supplement thereto, or (ii) are contained in
an outdated or defective Registration Statement used by the Priveco Shareholders
after Pubco has notified the Priveco Shareholders in writing that the
Registration Statement is outdated or defective.

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1.5.                       Each of the Priveco Shareholders shall severally, and
not jointly and severally, indemnify and hold harmless Pubco, its directors,
officers, agents and employees, each person who controls Pubco (within the
meaning of Section 15 of the 1933 Act and Section 20 of the 1934 Act), and the
directors, officers, agents or employees of such controlling persons, to the
fullest extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based solely upon: (x) such Priveco
Shareholders’ failure to comply with the prospectus delivery requirements of the
1933 Act, or (y) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading to the extent, but only
to the extent, that such untrue statements or omissions (i) are contained in any
information so furnished in writing by such Priveco Shareholder to Pubco
specifically for inclusion in the Registration Statement, or (ii) are based
solely upon information regarding such Priveco Shareholder furnished in writing
to Pubco by such Priveco Shareholder expressly for use therein, or (iii) are
contained in information relating to such Priveco Shareholder or such Priveco
Shareholder’s proposed method of distribution of Registrable Securities that was
reviewed and expressly approved in writing by such Priveco Shareholder expressly
for use in the Registration Statement or in any amendment or supplement thereto,
or (z) the use by such Priveco Shareholder of an outdated or defective
Registration Statement after Pubco has notified such Priveco Shareholder in
writing that the Registration Statement is outdated or defective. In no event
shall the liability of any Priveco Shareholder hereunder be greater in amount
than the dollar amount of the net proceeds received by such Priveco Shareholder
upon the sale of the Registrable Securities giving rise to such indemnification
obligation.

1.6.                       If a claim for indemnification hereunder is
unavailable to either Pubco or the Priveco Shareholders (in each case, an
"Indemnified Party or Indemnified Parties", as applicable) (by reason of public
policy or otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth herein, any reasonable attorneys’ or other
reasonable fees or expenses incurred by such party in connection with any
proceeding to the extent such party would have been indemnified for such fees or
expenses if the indemnification provided for in this section was available to
such party in accordance with its terms. Pubco and the Priveco Shareholders
agree that it would not be just and equitable if contribution pursuant to this
section were determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to in the immediately preceding paragraph. Notwithstanding the provisions of
this section, no Priveco Shareholder shall be required to contribute, in the
aggregate, any amount in

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excess of the amount by which the proceeds actually received by such Priveco
Shareholder from the sale of the Registrable Securities subject to the
proceeding exceeds the amount of any damages that such Priveco Shareholder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, except in the case of fraud by such
Priveco Shareholder.

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