EX-10.1






EXHIBIT 10.1




CONFIDENTIAL SETTLEMENT AND RELEASE OF CLAIMS AGREEMENT




THIS CONFIDENTIAL SETTLEMENT AND RELEASE OF CLAIMS AGREEMENT (“AGREEMENT”), effective on the last
date executed below, is entered into between CANNAPHARMARX, INC., a Delaware Corporation (“CPRx”),
on behalf of itself, its officers, directors (including GARY HERICK (“Herick”), GERALD CROCKER
(“Crocker”), JAMES SMEEDING (“Smeeding”), MATHEW SHERWOOD (“Sherwood”), and ROBERT LIESS (“Liess”),
in their individual and representative corporate capacities), owners, shareholders, employees,
attorneys, representatives and agents (in their individual and representative corporate
capacities), and CPRx’s parent, affiliated, predecessor, successor, subsidiary, and other related
companies, including Golden Dragon Holding Co., CannaPharmaRx, Inc. (the privately held Colorado
corporation), and CannaPharmaRx, Inc. Acquisition Corporation, and their officers, directors,
owners, shareholders, employees, attorneys, representatives and agents (in their individual and
representative corporate capacities), and each of them, jointly and severally (herein singularly
and collectively called “the Company”), and GARY M. COHEN, on behalf of himself and his heirs,
executors, guardians, administrators, successors, and assigns, and each of them, jointly and
severally (herein singularly and collectively called “COHEN”), who agree to be bound by all of the
terms and conditions hereof.



WHEREAS, COHEN initiated an action in the Circuit Court, Hillsborough County, Florida against
CannaPharmaRx, Inc. (the Colorado corporation), CannaPharmaRx, Inc. Acquisition Corp., Golden
Dragon Holding Company, Herick, Crocker, Smeeding, Liess, and Sherwood (Case No. 14-CA-010970),
which was removed to the United States District Court, Middle District of Florida, Tampa Division,
and assigned Case No. 8:14-cv-02969-MSS-TGW (“the Cohen Case”). Cohen alleged various contract and
employment-related claims, as well as made allegations of what he believed had been corporate
fraud, misappropriation, breach of fiduciary duty, and SEC or SOX-related violations;



WHEREAS, the Company and all the individuals who have been sued by COHEN in the Cohen Case
categorically and vehemently deny all of COHEN’s claims and allegations, have maintained that the
allegations are false, and were prepared to assert counterclaims of their own until this resolution
and COHEN’s retraction of certain of these allegations was achieved;



WHEREAS, Golden Dragon Holding Company initiated an action against COHEN for libel and tortious
interference with its business relationships in the United States District Court, District of New
Jersey, which was assigned Case No. 1:14-cv-07073-RMB-AMD (“the Golden Dragon Case”);



WHEREAS, to avoid any further time commitment and legal expense, the Company and COHEN
(hereinafter collectively referred to herein as “the Parties”) now wish to resolve and settle
amicably the Cohen Case, the Golden Dragon Case, and any and all other claims of whatever kind or
nature that the Parties may have against each other;



THEREFORE, in consideration of the mutual covenants and promises set forth in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
it is hereby agreed by and between the Parties as follows:




1. Mutual Dismissal of Actions. Within three (3) business days of the execution of this
Agreement, COHEN agrees to voluntarily dismiss the Cohen Case with prejudice, and the Company
agrees to voluntarily dismiss the Golden Dragon Case with prejudice. Each Party authorizes its
counsel to file with the Court the necessary paperwork to accomplish these dismissals with
prejudice, and these entries shall provide that each party shall bear its/his own costs, expenses
and attorneys’ fees.




2. Settlement Payment. CPRx agrees to purchase COHEN’s 2,250,000 common shares of CPRx (the
privately held Colorado corporation) for Three Hundred Fifty Thousand Dollars and Zero Cents
($350,000.00) in cash, subject to Form 1099 reporting (the “Settlement Payment”). COHEN agrees
that the Settlement Payment is intended to and does compensate him for the value of his CPRx
            shares, and no portion of this consideration is intended to or does compensate COHEN for the
claims he brought or could have brought in the Cohen Case or any other claims that he has or may
have, whether known or unknown, at the time of the execution of this Agreement. The Settlement
Payment is subject to the following terms and conditions and payment schedule:




	 	(a)	 	Pay COHEN Eighty Five Thousand Dollars and Zero Cents ($85,000.00) by wire
transfer via his lawyer’s trust account after the effective date of this Agreement and
within three business days after the submission to the courts of a dismissal with
prejudice of the Cohen Case and the Golden Dragon Case.






	 	(b)	 	Pay COHEN Fifteen Thousand Dollars and Zero Cents ($15,000.00) on the first of
each calendar month thereafter for seventeen (17) months via wire transfer to COHEN,
and with a final payment of Ten Thousand Dollars and Zero Cents ($10,000.00) on the
first day of the next calendar month thereafter.






	 	(c)	 	CPRx agrees to pay COHEN all remaining unpaid monthly payments in one lump sum
payment, via wire transfer to COHEN, within ten business days upon CPRx raising an
aggregate of Seven Million Dollars and Zero Cents ($7,000,000.00) or more in permanent
capital (for the sake of clarity, this would not include any capital raised via a debt
instrument) after the effective date of this Agreement.






	 	(d)	 	In addition to such cash payment, and in exchange for COHEN (1) surrendering
all of his 2,250,000 common shares of CPRx (the privately held Colorado corporation);
and (2) releasing any and all claims and rights (including dissenter’s rights) related
in any way to the issuance, surrender, or forfeiture of such shares, CPRx agrees to
grant and provide COHEN with Six Hundred Thousand (600,000) unregistered restricted
            shares (the “Settlement Shares”), in CPRx, the Delaware corporation. Such grant of
Settlement Shares will be subject to the terms and conditions of, and COHEN entering
into, a Subscription Agreement with CPRx, which also will contain reasonable and
necessary metering restrictions. A copy of such Subscription Agreement is attached
hereto as Appendix A and is incorporated into this Agreement in its entirety.






	 	(e)	 	COHEN acknowledges and agrees that he will be responsible for all federal,
state, and local tax consequences and obligations related to the foregoing payments and
grant of restricted shares, and agrees to indemnify, defend and hold harmless the
Company from all such tax consequences and obligations. COHEN agrees that he will
forfeit such payments and will be responsible for reimbursing CPRx for the same if he
violates his obligations under this Agreement.






3. URL Transfer. COHEN will transfer and assign to CPRx all contractual and all other legal
rights to the URL “CannaPharmaRx.com.”




4. Withdrawal of Certain Allegations. Within no later than three (3) business days after the
effective date of this Agreement, COHEN shall issue electronically from PRNewswire.com a copy of
the press release attached hereto as Appendix B. COHEN will also provide the Company and each of
the defendants named in the Cohen Case with a signed, unsworn letter on his personal letterhead
containing the content of the letter attached hereto as Appendix C which states, among other
things, that he withdrawals certain allegations he made in the Cohen Case. CPRx agrees to redact
the contents of the letter and replace the same with a “Confidential” stamp if and when it files
the letter with the SEC as an attachment to this Agreement. The same will apply to any other
governmental filing or submission of the Agreement that CPRx may be required to make. The named
defendants in the Cohen Case will also remain free to use or disclose the press release and the
letter for any business, employment-related or personal purpose. But, CPRx and the named
defendants agree not to publish the letter on the internet, including on any website, except they
will remain free to privately email the letter by PDF for the business, employment-related and
personal purposes identified in this Paragraph. The Company and the individual Defendants also
will remain free to send or publish the press release on the internet. The Parties acknowledge
and agree that they have negotiated the terms of the press release and the letter as part of
their settlement and this Agreement.




5. Behavior. COHEN agrees to be bound to the Confidential Information and Returning Company
Documents obligations set forth in Sections 7.A and 7.B of the Employment Agreement document
provided to him by Golden Dragon Holding Co. and which he signed, the obligations of which are
incorporated “as is” into this Agreement. A copy of Sections 7.A. and 7.B. are attached to this
Agreement as Appendix D.




6. Forfeiture. If COHEN breaches any of his obligations under the Agreement, CPRx may
immediately cease any payments still owed to COHEN under Paragraph 1 of this Agreement, and will
be entitled to seek forfeiture and return by COHEN of any shares granted or payments made to him
previously under the Agreement.




7. Entire Amount of Monetary Consideration. The Parties agree that this Agreement sets forth the
entire amount of monetary and other consideration to which COHEN is entitled from the Company and
that he will not seek any further compensation, shares or monies of any kind or nature from the
Company, including but not limited to back pay, severance pay, front pay, wages, overtime,
vacation pay, bonuses, benefits, attorneys’ fees, costs, interest, damages (whether compensatory,
punitive or otherwise), business expenses, or other monies.




8. Termination of Relationship. COHEN acknowledges that any business, consultancy, or employment
affiliation he may have had with the Company ended on October 23, 2014. Unless the Company
agrees in advance and in writing that COHEN may submit an application for employment or
reemployment with the Company, COHEN agrees that he will not apply for, seek or accept employment
or reemployment with the Company at any time, that the Company shall have no obligation to
employ, reemploy, or otherwise associate with him in the future, and that this Paragraph
represents a valid, non-discriminatory, non-retaliatory reason to decline to consider his
application and to refuse to employ, reemploy him, or associate with him if he applies or
reapplies contrary to this Agreement.




9. Representations and Warranties. COHEN represents and warrants that he has no pending charges,
claims, suits, complaints or grievances against the Company with any federal, state, local or
other governmental agency, or in any court of law, and has not suffered any work-related injury
or illness within two years prior to the effective date of this Agreement. COHEN acknowledges
and agrees that he has been fully and properly paid for all hours in which he provided services
to the Company. COHEN has requested and received such information in connection with the
execution of this Agreement as he believes to be necessary in order to make an informed decision
to enter into this Agreement and to bind himself as set forth herein, and he has had an
opportunity to discuss this information with his own advisors and consultants and obtain answers
to any questions that he may have had. COHEN further acknowledges and agrees that the Settlement
Payment is only an estimate of the value of his shares and could differ from the value that might
be determined in some other context by some other party. COHEN has based his decision to sell
his shares on (i) his own independent due diligence investigation, (ii) his own expertise and
judgment, and (iii) the advice and counsel of his own legal, tax, and economic advisors and
consultants. COHEN represents and warrants that he has not relied on any representations or
omissions made by the Company in connection with this Agreement, COHEN agrees that the Company
will not be liable for COHEN’s use of the information he was provided by the Company in
connection with this Agreement, and COHEN waives any claims for fraudulent inducement based on
any misrepresentations or omissions by the Company in connection with this Agreement.




10. Covenant Not to Sue. COHEN agrees not to file any charges, claims, suits, complaints, or
grievances against the Company with respect to any aspect of his affiliation with, or separation
from, the Company, or with respect to any other matter whatsoever, whether known or unknown to
him at the time of execution of this Agreement, with the exceptions of: (a) any claim that the
Company breached its commitments under this Agreement; and (b) any claims that the law precludes
him from waiving by agreement.




11. Release of Claims.




(a) Release by Cohen. COHEN acquits, releases, and forever discharges the Company of and from
all, and in all manner of, actions and causes of action, suits, debts, claims, and demands
whatsoever, in law or in equity, which he ever had, or may now have, with respect to any aspect
of his affiliation with the Company, or with respect to any other matter whatsoever, whether
known or unknown to him at the time of execution of this Agreement, including, but not limited
to, claims for compensatory, actual, special, consequential, reliance, punitive, exemplary and/or
other damages, including but not limited to claims for personal injuries, pain and suffering,
emotional distress, health care expenses, back pay, front pay, separation pay, wages, benefits,
attorney’s fees, costs, interest, other monies or the shares he was issued and owns in
CannaPharmaRx, Inc. (the privately held Colorado corporation), any claims or liability based on
the distribution by the Company of the press release or letter referenced in Paragraph 4 above
where the distribution is permitted under this Agreement, or any claims that might arise as a
result of any determination that the value of his shares at the time of execution of this
Agreement was more or less than the Settlement Payment, but excluding: (i) any claim for breach
of this Agreement; and (ii) any claims the law precludes from waiving by agreement.




(a) (b) Release by the Company. The Company acquits, releases, and forever discharges COHEN
of and from all, and in all manner of, actions and causes of action, suits, debts, claims,
and demands whatsoever, in law or in equity, which the Company ever had, or may now have,
with respect to any aspect of its affiliation with COHEN, or with respect to any other matter
whatsoever, whether known or unknown to the Company at the time of execution of this
Agreement, including, but not limited to, claims for compensatory, actual, special,
consequential, reliance, punitive, exemplary and/or other damages, including but not limited
to claims for attorney’s fees, costs, or interest, but excluding: (a) any claim for breach of
this Agreement; and (b) any claims the law precludes from waiving by agreement.




12. Laws Included in Release. COHEN agrees that with the exception of any action for breach of
this Agreement or that the law precludes him from waiving by agreement, his covenants and
releases, as set forth in this Agreement, include a waiver of any and all rights or remedies
which he ever had or may now have against the Company under any present or future federal, state,
or local statute or law, including, but not limited to the Constitutions of the United States and
the State of Florida; the Florida Civil Rights Act of 1992; the Florida Equal Pay Act, § 725.07,
Florida Statutes; the Florida Whistleblower Act, § 448.102, et seq., Florida Statutes; the
Florida’s Workers’ Compensation Statutes; Florida’s Workers’ Compensation Anti-Retaliation
Provision, § 440.205, Florida Statutes; Florida’s Wage Rate Provision, § 448.07, Florida
Statutes; Florida’s Attorneys’ Fees Provision for Successful Litigants in Suits for Unpaid Wages,
§ 448.08, Florida Statutes; and any other claims for unpaid or delayed payment of
wages, vacation, overtime, missed or interrupted meal periods; Title VII of the Civil Rights Act
of 1964, 42 U.S.C. §2000e, et seq.; the Civil Rights Act of 1866, 42 U.S.C. §1981; the Civil
Rights Act of 1991, PL. 102-166; the ADEA and the Older Workers Benefit Protection Act, 29 U.S.C.
§621, et seq.; the Americans with Disabilities Act, 42 U.S.C. §12101, et seq.; the FLSA and the
Equal Pay Act of 1963, 29 U.S.C. §201, et seq.; the FMLA; the Employee Retirement Income Security
Act, 29 U.S.C. §1001, et seq.; the Occupational Safety and Health Act of 1970, 29 U.S.C. §553, et
seq.; the National Labor Relations Act, 29 U.S.C. §141, et seq.; COBRA; and any statutory
amendments.




13. Waiver of Unknown Claims. The Parties intend that this Agreement shall bar each and every
claim, demand, and cause of action hereinabove specified, whether known or unknown to them at the
time of execution of this Agreement. As a result, they acknowledge that they might, in the
future, discover claims or facts in addition to or different from those which they now know or
believe to exist with respect to the subject matter of this Agreement and which, if known or
suspected at the time of executing this Agreement, may have materially affected this settlement.
Nevertheless, the Parties waive any right, claim, or cause of action that might arise as a result
of such different or additional claims or facts.




14. Mutual Non-Disparagement and Non Admission. CPRx and COHEN agree not to make, publish or
communicate publicly any false or intentionally disparaging remarks or statements about the
other. For CPRx and its related entities, such obligation will only apply to their then
directors and officers while they are holding such positions with CPRx, and that only the
corporate entity, not any individual officer or director, will be subject to liability for any
violation of this obligation. The Parties also agree that neither is admitting to any liability
owed to the other. For the avoidance of doubt, COHEN acknowledges that the statements described
in paragraph 4 of this Agreement are not false and do not disparage him, and the Company’s
distribution of the press release and letter as set forth in Paragraph 4 above are not a breach
of the Company’s non-disparagement obligations.




15. Confidential Information and Trade Secrets. COHEN acknowledges that the confidential
information and trade secrets of the Company, including business and financial information,
plans, ideas, programs, designs, drawings, methods, materials, equipment, customer lists,
inventions, processes, files, materials, and the like, are valuable assets of the Company, the
disclosure of which to those outside the Company could cause immediate and irreparable harm to
the Company. COHEN therefore agrees that except upon the prior written consent from the Company,
he will not use, convey, or disclose to any person, corporation or entity any such confidential
information or trade secrets that he may have acquired or gained access to while he was
associated with the Company.




16. Non-Interference with Gary Cohen’s Legally Protected Rights. The Company and COHEN
understand and agree that nothing in this Agreement interferes with or in any way restricts the
Parties’ legal rights to participate or cooperate truthfully in any inquiry, investigation or
proceeding by any federal, state or local government agency charged with the enforcement of any
laws. The Company and COHEN agree, however, that COHEN is releasing and waiving any right or
demand to recover for himself (as COHEN is defined in this Agreement) any monetary damages,
award, or other legal or equitable relief in connection with any such inquiry, investigation, or
proceeding.




17. Return of Company Property. By or before the effective date of the Agreement, COHEN shall
return to the Company, in a manner and at a location as the Company directs, all property of the
Company of any kind in his possession or under his control, including but not limited to all
computers, laptops, computer passwords, phones, keys, credit cards, book displays, marketing
materials), and any hard copies and electronic business records. By signing this Agreement, COHEN
acknowledges that he has not kept possession of, or deleted, destroyed, encrypted, downloaded,
emailed, or copied, any of the Company’s electronic business information for the purpose of
using, possessing or disclosing the same for any personal, business or other purpose following
his separation from CPRx.




18. Cooperation in Legal Matters. For the seventeen-month period following the effective date of
this Agreement, COHEN agrees that upon reasonable notice from the Company, he will make himself
available to the Company, and cooperate with and assist the Company, in connection with any
proceeding before a federal, state, or local governmental agency, or in any arbitration or court
of law, pertaining to any matter for which he has knowledge or information as a result of his
affiliation with the Company through the effective date of this Agreement. In the event that a
subpoena or other lawful process is properly served upon COHEN requiring production or disclosure
of information or documents concerning the foregoing matters, COHEN or his legal counsel shall
promptly notify the Company’s President, in writing, and provide the President with copies of any
subpoena or other process served upon him. COHEN shall thereafter make such documents available
to the Company for inspection and copying at a reasonable time and place designated by the
Company prior to their production. In the event that the subpoena or other process requires
testimony or statements from COHEN, COHEN agrees to meet, telephonically or in person, with
attorneys or agents designated by the Company, at a time and place designated by the Company and
prior to the testimony, for the purpose of discussing such testimony. Nothing herein shall give
the Company the right to control or dictate the content of any testimony given by COHEN, or any
documents produced by him, it being understood that COHEN shall testify truthfully and shall
provide all information lawfully required of him. In the event that the Company requires any
information or testimony from COHEN in connection with any claim made against the Company, or any
claims made by the Company against persons or entities not party to this Agreement, COHEN agrees
to cooperate reasonably but fully with the Company, including: (a) appearing at any trial,
hearing, deposition or arbitration; (b) meeting telephonically or in person with attorneys or
agents designated by the Company, at a time and place designated by the Company and prior to the
testimony, for the purpose of discussing such testimony and any other matters relating to the
claim; and (c) providing the Company with any documentation in COHEN’s custody or control. The
Company agrees to reimburse COHEN for reasonable costs, pre-approved by the Company, that he
incurs in assisting the Company in the foregoing matters. The Parties agree that the provisions
of this Paragraph shall not apply to any action brought under this Agreement.




19. Adequate Consideration. COHEN agrees that the covenants and promises made by him in this
Agreement are in consideration of the payment and other promises made hereunder by the Company,
which he acknowledges to be sufficient, just and adequate consideration for his covenants and
promises. COHEN further acknowledges that, but for his execution of this Agreement, he would not
be entitled to the settlement payment or Settlement Shares being provided to him under this
Agreement.




20. Non-Disclosure. The Parties agree not to disclose the terms of this Agreement publicly
except as may be required by law, in any SEC filing or other similarly required public disclosure
or release, or as CPRx may reasonably need to do so for business purposes (such as in a
discussion with a future investor or shareholder, etc.). COHEN agrees not to disclose the terms
of the Agreement to anyone other than his counsel, tax or financial advisors, immediate family
members (or current girlfriend), subject to each of their respective agreements to keep the terms
strictly confidential and to not disclose the terms to any other person or entity.




21. Relief for Breach. The Parties agree that if either Party at any time asserts that any of
the terms of this Agreement have been violated, that Party shall have the right to seek specific
performance of such term or terms, appropriate injunctive relief to prevent a breach of the term
or terms, and any other necessary and proper relief, including monetary damages, from any court
of competent jurisdiction, and that the prevailing Party (by court judgment, order, verdict or a
private settlement) shall be entitled to recover its reasonable costs (including discovery
costs), expenses and attorney’s fees incurred in connection with any such legal and/or equitable
action.




22. Governing Law and Interpretation. The Parties agree that this Agreement shall be construed
in accordance with New Jersey law, that any action brought by any Party hereunder may be
instituted and maintained only in the appropriate federal or state court located in New Jersey
where CPRx maintains its headquarters, and that the Parties consent and agree to the personal
jurisdiction and subject matter jurisdiction of either such court, and that this Agreement shall
be interpreted in accordance with the plain meaning of its terms and not strictly for or against
any Party.




23. Modification, Waiver and Assignment. This Agreement shall not be changed, modified,
terminated, canceled or amended except by a written instrument signed by both CPRx and COHEN. The
failure to exercise or a delay in exercising, any right, remedy or power under this Agreement
shall not operate as a waiver thereof, nor shall any single or partial exercise of any right,
remedy or power under this Agreement preclude any other or further exercise thereof. The Parties
agree that the Company, but not COHEN, may assign its rights and obligations under this Agreement
without notice to or consent from COHEN.




24. Notices. Any notices required or permitted to be given under this Agreement shall be in
writing, sent by certified or registered mail, as follows:



	 	 	 
	To GARY COHEN:
	 	To the Company:

	Gary Cohen

8615 Vivienne Bass Way

Odessa, Florida 33556
	 	CannaPharmaRx, Inc.

Attn: President

1 Collins Drive Suite 100

Carney’s Point, NJ 08069-3640








25. Headings and Electronic Signature. The headings used in this Agreement are descriptive only,
are for the convenience of identifying provisions, and are not determinative of the meaning or
effect of any provision. The parties agree that hard copy and electronic copies of their
signatures to this Agreement shall be deemed original signatures.




26. Entire Agreement. The Parties agree that this Agreement, together with its Appendices A- D,
constitute the entire agreement between them and that except to the extent referred to herein or
incorporated herein by reference, there exist no other agreements, oral or written, express or
implied, relating to any matters covered by this Agreement, or relating to any other matter
whatsoever, whether or not within the knowledge or contemplation of any of the Parties at the
time of execution of this Agreement.




27. Acknowledgement. COHEN acknowledges and agrees:




	 	(a)	 	He has had more than ample time within which to review and consider signing
this Agreement;






	 	(b)	 	He was advised and hereby is advised in writing to consult with an attorney of
his choice (namely Dale James Morgado, Esq.), at his expense, prior to signing this
Agreement;






	 	(c)	 	He has read the terms of this Agreement, he agrees that this Agreement is
written clearly and with language he understands, and he has knowingly, voluntarily and
of his own free will agreed to the terms of this Agreement for the purpose of fully and
finally compromising and settling any and all claims, disputed or otherwise, of any
kind or nature that he ever had or may now have against the Company arising out of his
association with and/or separation from the Company, and arising out of any other
matter, whether known or unknown to him at the time of execution of this Agreement;






	 	(d)	 	He is not waiving any claims or rights that may arise after the execution of
this Agreement under the ADEA, or otherwise;






	 	(e)	 	The settlement payment provided to him under Paragraph Nos. 2(a) and 2(b)
hereof exceed the amount to which he would have otherwise been entitled as a result of
his separation from the Company and are in exchange for him signing this Agreement.






28. Effective Date. The Parties agree that the effective date of this Agreement shall be the
last date that a Party to this Agreement enters its/his signature to this Agreement.



WHEREFORE, the Parties have read all of the foregoing, understand the same, and agree to all of the
provisions contained herein.



	 	 	 	 	 	 	 
	CANNAPHARMARX, INC. ("CPRx")	 	GARY COHEN
	By:

	 	/s/ Gerald Crocker
	 	By:
	 	/s/ Gary Cohen
	
 
	 	 
	 	 	 	 
	Its:

	 	Chief Executive Officer—
	 	

	 	GARY COHEN



	
 
	 	 
	 	

	 	

	Dated:

	 	3/30/15      
	 	Dated:
	 	3/30/15
	
 
	 	 
	 	 	 	 






THE COMPANY AS DEFINED IN THIS AGREEMENT, INCLUDING GOLDEN DRAGON HOLDING CO., CANNAPHARMARX, INC.
(THE PRIVATELY HELD COLORADO CORPORATION), AND CANNAPHARMARX ACQUISITION CORP.



	 	 	 	 	 	 	 
	By:

	 	/s/ Gerald Crocker
	 	

	 	

	
 
	 	 
	 	

	 	

	Its:

	 	Chief Executive Officer—
	 	

	 	

	
 
	 	 
	 	

	 	

	
 
	 	Authorized Representative
	 	

	 	

	Dated:

	 	3/31/15
	 	

	 	

	
 
	 	 
	 	

	 	

	GARY HERICK
	 	 	 	GERALD CROCKER
	By:

	 	/s/ Gary Herick
	 	By:
	 	/s/ Gerald Crocker
	
 
	 	 
	 	 	 	 
	
 
	 	Gary Herick
	 	 	 	Gerald Crocker
	Dated:

	 	3/30/15      
	 	Dated:
	 	3/30/15_
	
 
	 	 
	 	 	 	 
	JAMES SMEEDING
	 	ROBERT LIESS
	By:

	 	/s/ James Smeeding
	 	By:
	 	/s/ Robert Liess
	
 
	 	 
	 	 	 	 
	 	 	James Smeeding	 	Robert Liess
	Dated:

	 	3/30/15      
	 	Dated:
	 	3/30/15_
	
 
	 	 
	 	 	 	 






MATHEW SHERWOOD



	 	 	 
	By:
	 	/s/ Mathew Sherwood

	 	 	 

	 	 	Mathew Sherwood

	Dated:
	 	March 30, 2015

	 	 	 







1




APPENDIX A




Subscription Agreement between CPRx and Gary Cohen




Subscription Agreement




CANNAPHARMARX




A Delaware Corporation




COMMON STOCK

(Restricted)




SUBSCRIPTION AGREEMENT AND REPRESENTATIONS




TO: CannaPharmaRx, Inc.



Board of Directors



Gentlemen:



I, Gary M. Cohen, understand that CannapharmaRx, Inc., a Delaware Corporation (the “Company”)
has agreed to issue 600,000 restricted Shares of Common Stock of the Company (the “Shares”),
pursuant to a Settlement and Mutual Release of Claims Agreement (“Settlement Agreement”) between
the Company and me per the effective date of the Settlement Agreement, containing specific terms
and conditions incorporated herein by this reference.



I hereby subscribe and agree to accept 600,000 Shares of restricted common stock of the
Company and upon acceptance by the Company, I agree to become a Shareholder of the Company under
terms hereof, which include the terms of the Metering Agreement as attached hereto as Exhibit A and
incorporated herein by this reference.



In order to induce the Company to accept my offer, I represent as follows:




	(1)	 	ACKNOWLEDGMENT OF REVIEW OF INFORMATION ABOUT COMPANY. I hereby acknowledge that I
have reviewed all pertinent publicly filed documents relating to the Company, including its
SEC filings, including financial information necessary to execute this Agreement.






	(2)	 	AVAILABILITY OF INFORMATION. I hereby acknowledge that the Company has made available
to me the opportunity to ask questions of the Company and any other person or entity acting on
its behalf, concerning the information contained in the publicly filed corporate documents and
to obtain additional pertinent information, to the extent the Company possesses such
information for public dissemination . I further represent that I am not relying on (and will
not at any time rely on) any communication (written or oral) of the Company, as investment
advice or as a recommendation to acquire the Shares, it being understood that information and
explanations related to the terms and conditions of the Shares and the other publicly filed
and publicly disseminated corporate documents shall not be considered investment advice or a
recommendation to acquire the Shares.






	(3)	 	REPRESENTATIONS AND WARRANTIES. I represent and warrant to the Company that all of my
Representations herein are true and correct and understand that the Company is relying upon
the accuracy and completeness of my representations and warranties in connection with the
availability of an exemption for the offer and issuance of the Shares from the registration
requirements of applicable federal and state securities laws.






	(4)	 	RESTRICTED SECURITIES.






	 	(a)	 	I understand that the Shares have not been registered under the Securities
Act of 1933, as amended (The Act), or any state securities laws.






	 	(b)	 	I understand that if my subscription is accepted and the Shares issued, I cannot
sell or otherwise dispose of the Shares, unless the shares being sold are registered
under the Act or the state securities laws or exemptions there from are available (and
consequently, that I must bear the economic risk of the investment for an indefinite
period of time).






	 	(c)	 	I understand that the Company has no obligation now or at any time to register the
Shares under the Act or the State securities laws or obtain exemptions there from.






	 	(d)	 	I understand that the Company will restrict the transfer of the Shares in
accordance with the foregoing representations.






	 	 	 	( e) I understand that the Company is a thinly traded OTC company, there is a
high risk that the shares may remain illiquid for an extended length of time, and that
the market is highly dependent on the success of the Company, over which I will have no
control.






	(5)	 	LEGEND.






I agree that any certificate representing the Shares will contain and be endorsed with
the following, or a substantially equivalent, LEGEND:




	 	 	 	“These Shares have been acquired in a transaction not subject to the registration
requirements of the Securities Act of 1933, as amended, pursuant to an investment
representation by the holder and shall not be sold, pledged, hypothecated or donated,
or otherwise transferred except upon the issuance to Company of a favorable opinion by
counsel acceptable to it and the submission to the Company of other evidence
satisfactory to and as required by counsel to the company; that any such transfer will
not violate the Securities Act of 1933, as amended, and applicable state securities
laws.






	 	 	 	The Shares represented by this certificate are subject to a Metering Agreement
between the Company and the holder and may only be sold in accordance with the terms of
the Metering Agreement.”






	(6)	 	AGE: CITIZENSHIP.






I am at least twenty-one (21) years old and a citizen of the USA.




	(7)	 	ACCURACY OF INFORMATION.






All information which I have provided to the Company concerning my financial position,
sophistication, and knowledge of financial and business matters is correct and complete as of
the date set forth herein.




	(8)	 	OFFERING PROCEDURE.






I understand that this subscription offer is subject to each of the following terms and
conditions:




	 	(a)	 	This subscription offer shall become binding upon the Company only when accepted,
in writing, by the Company, concurrent with the execution of the Settlement Agreement
incorporated by reference herewith.






	 	(b)	 	This subscription offer may not be withdrawn by me, after acceptance by the
Company.






	(9)	 	SUITABILITY. I hereby further warrant and represent:






	 	(a)	 	That I can afford a complete loss of the stock value and can afford to hold the
securities being received hereunder for an indefinite period of time;






	 	(b)	 	That I consider this investment a suitable investment, and I am sophisticated in
business and investment matters, including stock ownership;






	 	(c)	 	That I have had substantial prior experience in financial matters and investments;
and






	 	(d)	 	I have such knowledge and experience in business and financial matters that I am
capable of evaluating the Company and proposed activities thereof, the risks and merits
of investment in the Shares and of making an informed investment decision thereon, and am
not utilizing a purchaser representative in connection with evaluating such risks and
merits.






	(10)	 	RESTRICTIONS.






This Subscription Agreement is personal to me. It may not be sold, transferred, assigned
or otherwise disposed of to any other person, natural or artificial.




	(11)	 	CONDITIONS.






This Subscription Agreement shall become binding upon the Company only when accepted, in
writing, by the Company, concurrent with the execution of the Settlement Agreement
incorporated by reference herewith.




	(12)	 	AFFIRMATIVE REPRESENTATIONS.






	 	(a)	 	I have reviewed carefully the Company information I deem necessary, including this
Subscription Agreement. I am aware that:






	 	(i)	 	There are substantial risks incident to the ownership of Shares in the
Company, and such Shares are highly speculative and involves a high degree of risk
of loss by me of value therein; and






	 	(ii)	 	No federal or state agency has passed upon the Shares or made any
finding or determination concerning the fairness of this investment.






	 	(b)	 	I acknowledge that I have been advised to consult my own attorney concerning the
investment, and I am represented by Dale Morgado, Esq. in this matter.






	 	(c)	 	I acknowledge that the investment in the Company is an illiquid investment. In
particular, I recognize that:






	 	(i)	 	Due to restrictions described herein and the lack of a significant
public market for these Shares, in the event I should attempt to sell my Shares of
the Company, my investment will be highly illiquid and probably must be held
indefinitely.






	 	(ii)	 	I must bear the economic risk of investment in the Shares for an
indefinite period of time, since the Shares has not been registered under the
Securities Act of 1933, as amended. Therefore, the Shares cannot be offered, sold,
transferred, pledged, or hypothecated to any person unless either subsequently
registered under said Act or an exemption from such registration is available and
the favorable opinion of counsel for the Company to that effect is obtained.






	 	(iii)	 	My right to transfer my Shares will be restricted as provided in this
Subscription Agreement, and the Metering Agreement attached hereto as Exhibit A
which is a material inducement to the Company to issue the shares.






	 	(d)	 	I represent to the Company that:






	 	(i)	 	I have carefully reviewed and understand the risks of, and other
considerations relating to, the acquisition of the Shares, including the risks set
forth in this Subscription Agreement;






	 	(ii)	 	I am acquiring the Shares for which I hereby subscribe for my own
account, as principal, for investment purposes only and not with a view to
the resale or distribution of all or any part of such Shares, and that I have no
present intention, agreement or arrangement to divide my participation with others
or to resell, transfer or otherwise dispose of all or any part of the Shares
subscribed for unless and until I determine, at some future date, that changed
circumstances, not in contemplation at the time of this purchase, makes such
disposition advisable;






	 	(iii)	 	I have adequate means of providing for my current needs and personal
contingencies and have no need for liquidity in this investment;






	 	(iv)	 	I consider myself sophisticated as an investor and have such knowledge
and experience in financial and business matters that I am capable of evaluating
the merits and risks of investment in the Shares and make an informed decision; and






	 	(v)	 	I have previously invested in private placements of stock.






	 	(e)	 	I hereby adopt, accept, and agree to be bound by all the terms and conditions of
this Agreement, and by all of the terms and conditions of the Articles of Incorporation,
and amendments thereto, and By-Laws, applicable to a Shareholder such as myself. Upon
acceptance of this Subscription Agreement by the Company under the term hereof, I shall
become a Shareholder for all purposes, and the Shares subscribed shall be issued.






	 	(f)	 	This Subscription Agreement, upon acceptance by the Company, shall be binding upon
my heirs, executors, administrators, successors, and assigns.





(13) INDEMNITY.




I hereby agree to indemnify the Company and hold the Company harmless from and against any
and all liability, damage, cost, or expense incurred on account of or arising out of:




	 	(a)	 	Any inaccuracy in my declarations, representations, and warranties hereinabove
set forth;






	 	(b)	 	The disposition of any of the Shares which I will receive, contrary to my
foregoing declarations, representations, and warranties; and






	 	(c)	 	Any action, suit or proceeding based upon (1) the claim that said declarations,
representations, or warranties were inaccurate or misleading or otherwise cause for
obtaining damages or redress from the Company; or (2) the disposition of any of the
Shares or any part thereof.





(14) GOVERNING LAW.



This Agreement shall be construed in accordance with and governed by the laws of the State of
New Jersey. Any action brought by either party hereunder must be instituted and maintained only in
the appropriate federal or state court located in the county of New Jersey where the Company
maintains its headquarters, and that the parties consent and agree to the personal jurisdiction and
subject matter jurisdiction of either such court.



(15) TITLE.




I will hold title to my Shares solely in my own name as subscriber.



(16) WAIVER.



As a specific inducement to the Company to enter into this Subscription, Gary M. Cohen hereby
waives and releases any and all claims whatsoever against Company, its officers, directors and
agents, relating to disclosure, corporate governance, representations not expressly contained
herein, arising under this Agreement up through date hereof.



IN WITNESS WHEREOF, subject to acceptance by the Company and terms hereof, I have completed
this Subscription Agreement to evidence my Subscription as set forth hereinabove, and I agree to
accept, pursuant to this Subscription Agreement, and the concurrent Settlement Agreement, the
amount of 600,000 Shares of the Company’s restricted common stock, under the terms hereof.



/s/ Gary M. Cohen     


Gary M. Cohen, Subscriber



THIS SUBSCRIPTION OFFER IS ACCEPTED THIS 1st DAY OF April, 2015.



CANNAPHARMARX, INC.



By:       /s/ Gerald Crocker      



Gerald Crocker, CEO



2



EXHIBIT A




Metering Agreement





3






METERING AGREEMENT




THIS METERING AGREEMENT (“Agreement”) is made effective as of this 1st day of April 2015,
by and among Gary M. Cohen (“Shareholder”) and CannaPharmaRx, Inc., a Delaware corporation (the
“Company”), and the consideration herefore is acknowledged as being the Settlement and Mutual
Release of Claims Agreement (“Settlement Agreement”) entered into between the Company and
Shareholder concurrently herewith.



WHEREAS, the Shareholder holds common stock of the Company, constituting 600,000 shares of
restricted common stock of CannaPharmaRx, Inc., a Delaware Corporation (“SHARES”), received as part
of the consideration in the Settlement Agreement.



WHEREAS, the Company believes it is in the best interests of its stockholders to maintain an
orderly trading market for shares of the Company’s common stock, and Shareholder has represented
that he is holding the SHARES for long-term investment;



WHEREAS, the Company desires the Shareholder to meter the selling of the SHARES held by the
Shareholder to encourage orderly trading in shares of the Company’s common stock; and to minimize
volatility for benefit of shareholder and all other stockholders.



WHEREAS, in order to induce the Company to enter into the Settlement Agreement, concurrently
herewith, Shareholder agrees to the terms herein.



NOW, THEREFORE, in consideration of the premises, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:



1. TERMS OF METERING.



a) the Shareholder understands and agrees that the shares are “restricted” within the meaning
of Rule 144 under the Securities Act of 1933;



b) the Shareholder agrees, that without the prior written consent of the Company, for a
period of one year the Shareholder will not make or cause any sale of the SHARES which, as of or
after the date of this Agreement, the Shareholder owns either of record or beneficially;



c) after one year from date hereof the Shareholder, shall have the right, but not the
obligation, to sell into the market, in any ninety day period, an amount of Common Shares equal to
     % of the total shareholding not to exceed, with each day’s trade, the average daily trading
volume of the Company’s Common Shares, computed for the prior 60 calendar days. Block Trades
(25,000 shares or more) may only be sold into the trading market by the Shareholder with the
written consent of the Company, in its sole discretion. Furthermore, the Shareholder will permit
all certificates evidencing the SHARES to be endorsed with the appropriate restrictive legends and
will consent to the placement of appropriate stop transfer orders pursuant to this Agreement with
the transfer agent of the Company;



d) when eligible, under the terms hereof and under Rule 144, the Shareholder must notify the
Company of the number of SHARES he intends to sell as well as the estimated dates, so that the
specified SHARES can be cleared and deposited. The Shareholder shall provide all of his trading
records for the securities for the previous 90 days together with the request to clear SHARES; and



e) The Company will process and clear the share certificates for the specified increments of
shares within five (5) business days from written Notice and Receipt of all necessary information
from Shareholder.



2. TRANSFER; SUCCESSOR AND ASSIGNS. The terms and conditions of this Agreement shall inure to
the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Agreement, except as expressly provided in this Agreement.



3. GOVERNING LAW. This Agreement shall, to the fullest extent allowed by law, be construed,
interpreted and enforced in accordance with the laws of the State of New Jersey , without regard to
or application of conflict of law rules. Any action brought by either party hereunder must be
instituted and maintained only in the appropriate federal or state court located in the county of
New Jersey where the Company maintains its headquarters, and the parties consent and agree to the
personal jurisdiction and subject matter jurisdiction of either such court,



4. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same
instrument.



5. TITLES AND SUBTITLES. The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this Agreement.



6. NOTICES.



(a) All notices, requests, demands and other communications under this Agreement or in
connection herewith shall be given or made upon (i) the Shareholder at such Shareholder’s address
set forth on the signature page hereto; and (ii) the Company at its home office in Carney’s Point,
New Jersey.



(b) All notices, requests, demands and other communications given or made in accordance with
the provisions of this Agreement shall be in writing, and shall be sent by overnight courier, or by
facsimile with confirmation of receipt, and shall be deemed to be given or made when receipt is so
confirmed.



(c) Any party may, by written notice to the other, alter its address or respondent and such
notice shall be given in accordance with the terms of this Section 6.



7. ATTORNEY’S FEES. If any action at law or in equity (including arbitration) is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover
from the non-prevailing party the prevailing party’s reasonable attorney’s fees, costs and
necessary disbursements in addition to any other relief to which such prevailing party may be
entitled as determined by such court, equity or arbitration proceeding.



8. AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended with the written consent
of the Company and the Shareholder.



9. SEVERABILITY. If one or more provisions of this Agreement are held to be unenforceable
under applicable law, portions of such provisions, or such provisions in their entirety, to the
extent necessary, shall be severed from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in accordance with its
terms.



10. DELAYS OR OMISSIONS. No delay or omission to exercise any right, power or remedy accruing
to any party to this Agreement, upon any breach or default of the other party to this Agreement
shall impair any such right, power or remedy of such holder nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or
default thereafter occurring; nor shall any waiver of any breach or default be deemed a waiver of
any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of any party to this Agreement of any breach or
default under this Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this Agreement or by law or
otherwise afforded to any holder shall be cumulative and not alternative.



11. ENTIRE AGREEMENT. This Agreement and the documents referred to herein (Settlement
Agreement and Mutual Release) constitute the entire agreement between the parties hereto pertaining
to the subject matter hereof, and any and all other written or oral agreements existing between the
parties are null and void. Any remedies for violation of this Agreement shall be governed by the
terms of the Settlement Agreement. However, should shareholder violate the terms of this
Agreement, Company shall have the immediate right to suspend all releases of restrictions and
shares for sales for a period of one year from discovery of each violation.



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



/s/ Gary M. Cohen      



Gary M. Cohen, Shareholder



8615 Vivienne Bass Way



Odessa, Florida 33556



	 
	For the Company:
	/s/ Gerald E. Crocker_________________
	CannaPharmaRx, Inc.

By its President

1 Collins Drive Suite 100

Carney’s Point, NJ 08069-3640







4




APPENDIX B




LAWSUITS INVOLVING GARY M. COHEN, CANNAPHARMARX, AND GOLDEN DRAGON HOLDING CO. HAVE BEEN RESOLVED
AND DISMISSED



Tampa, Florida – The lawsuit filed in Florida on October 30, 2014 against CannaPharmaRx, Gary
Herick, Gerry Crocker, Jim Smeeding, Mat Sherwood and Bo Liess by former CannaPharmaRx executive
Gary M. Cohen has been resolved and dismissed.  The parties amicably resolved their differences
before any discovery occurred or before any decision by the court on the merits of any claims. Mr.
Cohen had alleged various contract and employment-related claims, as well as made allegations of
what he believed had been corporate fraud, misappropriation, breach of fiduciary duty, and SEC or
SOX violations. CannaPharmaRx and all the individuals who had been sued categorically denied all of
Mr. Cohen’s claims allegations, have maintained that the allegations were false, and were prepared
to assert counterclaims of their own. As part of the parties’ resolution, Mr. Cohen has agreed to
retract his allegations.  



In addition, Golden Dragon Holding Co. and Mr. Cohen have resolved their differences in Golden
Dragon’s lawsuit filed against Mr. Cohen on November 11, 2014 in New Jersey.  Golden Dragon has
dismissed its claims of libel and tortious interference.  In his answer to the complaint, Mr. Cohen
maintained that he had not libeled Golden Dragon or tortiously interfered with its business
relationships.



5



APPENDIX C




Letter




April 2, 2015



	 	 	 
	CannaPharmaRx, Inc.

CannaPharmaRx, Inc. Acquisition Corp.

Golden Dragon Holding Co.

1 Collins Drive Suite 100

Carney’s Point, NJ 08069-3640

Gary Herick

161 Bronco Drive

Edwards, CO 81620

Gerald Crocker

43 Fredrick Boulevard

Swedesboro, NJ 08084

	 	James Smeeding

4029 Gilbert Avenue

Dallas, TX 75219

Robert Liess

2602 West Sam Allen Road

Plant City, FL 33565-5046

Mathew Sherwood

1537 Rainbow Drive

Silverthorn, CO 80598





	 

	 	 






Re: Resolution



Gentlemen:



As you know, between approximately the end of April 2014 until the end of October 2014, I helped
form and acted as the President and Chief Operating Officer of CannaPharmaRx, Inc., the
privately-held company incorporated in the state of Colorado. I provided my services to the company
while working out of my home in Odessa, Florida. I also served as a member of the company’s Board
of Directors and I was issued shares in the privately held company.



At the end of October 2014, the company made a business decision to remove me from the Board, and
asked that I no longer act as an officer for the company.



At the time of my departure, the company disputed that it had entered into or approved an
employment agreement with me. I believed we did have a binding agreement and that the agreement
entitled me to receive certain severance pay and benefits. Things became contentious between us.
The company ultimately offered me certain separation benefits, but declined to provide me the full
amount to which I thought I was entitled. Upon my departure, I admit I was very angry and
frustrated. I even orally threatened, in anger, that “I will destroy the company.”



On October 30, 2014, I initiated a lawsuit in Florida, which I amended on November 26, 2014. In
the amended complaint, I alleged various legal claims, including based on how I felt the company
had breached its obligations under an employment agreement to pay me certain severance benefits. I
also alleged that I had not been provided with certain corporate information that I believed, as an
officer, I was entitled to receive as a matter of corporate law. But I additionally made
allegations of what I thought had been intentionally fraudulent conduct, misappropriation of
corporate assets, and breaches of fiduciary duty by certain officers. I also alleged what I thought
may have been SEC, SOX, tax code or accounting principle violations.



I now regret having made these additional allegations in my lawsuit. Since filing my lawsuit, I
have learned that while I had strong disagreements with some of the company’s business decisions, I
did not have specific factual knowledge of decisions or conduct by any officer, director or other
individual—including Gary Herick, Gerry Crocker, Jim Smeeding, Mat Sherwood, Bo Liess, or Michael
Littman—that rose to the level of intentional fraud, unlawful misappropriation of assets, breach
of fiduciary duty, or any SEC, SOX, tax code or accounting principles violations. I now know that
no one associated with the company intended to defraud or deceive any governmental agency,
shareholder or potential investor in the company. I regret having made these allegations in my
lawsuit.



For instance, I have now learned that the company stopped sharing certain internal financial and
business information with me because it had concluded that my demanding management style was not
going to be a good fit for the company going forward and the Board had started working toward a
separation strategy for me. The other members of the executive team—whether rightly or wrongly—also
thought legally I was not entitled to receive all the corporate information I was asking to see
based on my position as COO as opposed to CEO. Apparently, that makes a difference under corporate
law and SEC rules. I have also since learned that internal control requirements under SOX did not
apply to the company because it was a start-up and not a seasoned issuer, nor did it meet SOX’s
market cap requirements.



Similarly, I have now learned that in conjunction with the company’s hiring of an experienced CFO
and a Controller, an extensive audit of the company’s books and records has not revealed fraudulent
expenditures of funds, misappropriation of assets, or any improper self-dealing. It appears there
were some isolated instances of what might be perceived as excessive spending with potential
investors on food, beverage and entertainment (such as for golf). But the results of the initial
round of funding were undeniably exceptional. Also, even though it also appears there may have been
some inconsistent book keeping as to some business expenditures, I understand that that has been
reconciled and corrected. I also now believe the company’s representation to me that all stock
share issuance by the company has been closely examined and there are no concerns of any improper
issuance or self-dealing there.



Bottom line—given what I have now learned, and in connection with our global resolution of all of
our differences, I feel I can now retract the allegations raised in my lawsuit and elsewhere
publicly pertaining to corporate fraud, misappropriation of assets, breach of fiduciary duty, or
any SEC, SOX, tax code or accounting principle violation. But, I do not withdraw or retract my
lawsuit allegations concerning breach of an asserted employment agreement, implied contract, or
improper denial to access to internal corporate information.



I am glad we have been able to resolve our differences.



Sincerely,



/s/ Gary M. Cohen



Gary M. Cohen



6



APPENDIX D





7. Confidentiality, Return of Property, and Covenant Not to Compete.




A. Confidential Information.



(1) Company Information. The Company agrees that it will provide the Executive with
Confidential Information, as defined below, that will enable the Executive to optimize the
performance of the Executive’s duties to the company. In exchange, the Executive agrees to use
such Confidential Information solely for the Company’s benefit. The Company and the Executive
agree and acknowledge that its provision of such Confidential Information is not contingent on the
Executive’s continued employment with the company. Notwithstanding the preceding sentence, upon
the termination of the Executive’s employment for any reason, the Company shall have no obligation
to provide the Executive with its Confidential Information. “Confidential Information” means any
Company proprietary information, technical data, trade secrets or know-how, including, but not
limited to, research, product plans, products services, customer lists and customers (including,
but not limited to, customers of the Company on whom the Executive called or with whom the
Executive became acquainted during the term of the Executive’s employment), markets, software,
developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware
configuration information, marketing finances or other business information disclosed to the
Executive by the Company either directly or indirectly in writing, orally or by drawings or
observation of parts or equipment. Confidential Information does not include any of the foregoing
items which has become publicly known and made generally available through no wrongful act of the
Executive or of others who were under confidentiality obligations as to the item or items involved
or improvements or new versions.



The Executive agrees at all times during the Term and thereafter, to hold in strictest
confidence, and not to use, except for the exclusive benefit of the Company, or to disclose to any
person or entity without written authorization of the Board of Directors of the Company, any
Confidential Information of the Company.



(2) Former Employer Information. The Executive agrees that he will not, during her employment
with the Company, improperly use or disclose any proprietary information or trade secrets of any
former employer or other person or entity and that the Executive will not bring onto the premises
of the Company any unpublished document or proprietary information belonging to any such employer,
person or entity unless consented to in writing by such employer, person or entity.



(3) Third Party Information. The Executive recognizes that the Company has received and
in the future will receive from third parties their confidential or proprietary information subject
to a duty on the Company’s party to maintain the confidentiality of such information and to use it
only for certain limited purposes. The Executive shall hold all such confidential or proprietary
information in the strictest confidence and not disclose it to any person or entity or use it
except as necessary in carrying, out the Executive’s work for the Company consistent with the
Company’s agreement with such third party.



B. Returning Company documents. At the time of leaving the employ of the Company, the
Executive will deliver to the Company (and will not keep in the Executive’s possession)
specifications, drawings blueprints, sketches, materials, equipment, other documents or property,
or reproductions of any aforementioned items developed by the Executive pursuant to the
Executive’s employment with the Company or otherwise belonging to the Company, its successors or
assigns.




7