Filed by Automated Filing Services Inc. (604) 609-0244 - Counterpath Corporation - Exhibit 10.1






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 




- 9 - 

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.







- 10 - 

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;







- 11 - 

	 	(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;







- 12 - 

	 	(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







- 13 - 

	 		
      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. 




- 14 - 

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.







- 15 - 

	 	(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,





- 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: 




- 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, 




- 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 




- 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 




- 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







- 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;







- 22 - 

	 	(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. 




- 23 - 

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







- 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.







- 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. 




- 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.







- 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.







- 28 - 

	 	(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”).







- 29 - 

	 	(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







- 30 - 

	 		
      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







- 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-




- 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







- 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 




- 34 - 

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





- 35 - 

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. 




- 36 - 

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;







- 37 - 

	 	(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);







- 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 




- 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. 




- 40 - 

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 




- 41 - 

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. 




- 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 	 







- 43 - 

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	 







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. 




- 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.; 




- 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 




- 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. 




- 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;







- 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. 




- 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 




- 2 - 

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. 




- 3 - 

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 




- 4 - 

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.