Document:

Form of Warrant to Purchase Series D Preferred Stock

 Exhibit 10.26 
 FORM OF WARRANT TO PURCHASE SERIES D PREFERRED STOCK 
 THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS
IS NOT REQUIRED. 
 WARRANT TO PURCHASE 
 SHARES OF SERIES D PREFERRED STOCK 
 OF 
 COMPREHENSIVE CARE CORPORATION 
 Expires May 13, 2012 
 Number of Shares:              
 Date of Issuance: May 13, 2009 
 FOR VALUE RECEIVED,
the undersigned, Comprehensive Care Corporation, a Delaware corporation (together with its successors and assigns, the “Issuer”), hereby certifies that
                             is entitled to subscribe for and purchase, during the Term (as hereinafter
defined), up to                              shares (subject to adjustment as hereinafter provided) of the
duly authorized, validly issued, fully paid and non-assessable Series D Preferred Stock of the Issuer, par value $50.00 per share (the “Series D Preferred Stock”), at an exercise price per share equal to the Warrant Price then in
effect, subject, however, to the provisions and upon the terms and conditions hereinafter set forth. 
 1. Term. The term of this
Warrant shall commence on May 13, 2009 and shall expire at 6:00 p.m., eastern time, on May 13, 2012 (such period being the “Term”). 
 2. Method of Exercise; Payment; Issuance of New Warrant; Transfer and Exchange. 
 (a) Time of
Exercise. The purchase rights represented by this Warrant may be exercised in whole or in part during the Term beginning on the date of issuance hereof. However, this Warrant may not be exercised until the Issuer has increased its authorized
capital from its current 30 million common shares. 
 (b) Method of Exercise. The Holder hereof may exercise this Warrant, in
whole or in part, by the surrender of this Warrant (with the exercise form attached in Appendix A hereto duly executed) at the principal office of the Issuer, and by the payment to the Issuer of an amount of consideration therefore equal to the
Warrant Price in effect on the date of such exercise multiplied by the number of shares of Warrant Stock with respect to which this Warrant is then being exercised, payable at such Holder’s election (i) by certified or official bank check
or by wire transfer to an account designated by the Issuer, (ii) by “cashless exercise” in accordance with the provisions of subsection (c) of this Section 2, or (iii) when permitted by clause (ii), by a combination of
the foregoing methods of payment selected by the Holder of this Warrant. 
 (c) Cashless Exercise. Notwithstanding any provisions
herein to the contrary and commencing six-months following the Original Issue Date if the Per Share Market Value of one share of Series D Preferred Stock is greater than the Warrant Price (at the date of calculation as set forth below), in lieu of
exercising this Warrant by payment of cash, the Holder may exercise this Warrant by a cashless exercise and shall receive the number of shares of Series D Preferred Stock equal to an amount (as determined below) by surrender of this Warrant at the
principal office of the Issuer together with the properly endorsed Notice of Exercise in which event the Issuer shall issue to the Holder a number of shares of Series D Preferred Stock computed using the following formula: 
 

 
  

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	Where	  	X =	  	the number of shares of Series D Preferred Stock to be issued to the Holder.
			
		  	Y =	  	the number of shares of Series D Preferred Stock purchasable upon exercise of all of the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being
exercised.
			
		  	A =	  	the Warrant Price.
			
		  	B =	  	the Per Share Market Value of one share of Series D Preferred Stock.

 An example of a cashless exercise is attached as Appendix B. 
 (d) Issuance of Stock Certificates. In the event of any exercise of this Warrant in accordance with and subject to the terms and conditions hereof,
certificates for the shares of Warrant Stock so purchased shall be dated the date of such exercise and delivered to the Holder hereof within a reasonable time, not exceeding three (3) Trading Days after such exercise (the “Delivery
Date”) or, at the request of the Holder, issued and delivered to the Depository Trust Company (“DTC”) account on the Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) within a
reasonable time, not exceeding three (3) Trading Days after such exercise, and the Holder hereof shall be deemed for all purposes to be the holder of the shares of Warrant Stock so purchased as of the date of such exercise. Notwithstanding the
foregoing to the contrary, the Issuer or its transfer agent shall only be obligated to issue and deliver the shares to the DTC on a holder’s behalf via DWAC if such exercise is in connection with a sale and the Issuer and its transfer agent are
participating in DTC through the DWAC system. The Holder shall deliver this original Warrant, or an indemnification undertaking with respect to such Warrant in the case of its loss, theft or destruction, at such time that this Warrant is fully
exercised. With respect to partial exercises of this Warrant, the Issuer shall keep written records for the Holder of the number of shares of Warrant Stock exercised as of each date of exercise. 
 (e) Transferability of Warrant. Subject to Section 2(g) hereof, this Warrant may be transferred by a Holder, in whole or in part. If
transferred pursuant to this paragraph, this Warrant may be transferred on the books of the Issuer by the Holder hereof in person or by duly authorized attorney, upon surrender of this Warrant at the principal office of the Issuer, properly endorsed
(by the Holder executing an assignment in the form attached hereto) and upon payment of any necessary transfer tax or other governmental charge imposed upon such transfer. This Warrant is exchangeable at the principal office of the Issuer for
Warrants to purchase the same aggregate number of shares of Warrant Stock, each new Warrant to represent the right to purchase such number of shares of Warrant Stock as the Holder hereof shall designate at the time of such exchange. All Warrants
issued on transfers or exchanges shall be dated the Original Issue Date and shall be identical with this Warrant except as to the number of shares of Warrant Stock issuable pursuant thereto. 
 (f) Continuing Rights of Holder. The Issuer will, at the time of or at any time after each exercise of this Warrant, upon the request of the
Holder hereof, acknowledge in writing the extent, if any, of its continuing obligation to afford to such Holder all rights to which such Holder shall continue to be entitled after such exercise in accordance with the terms of this Warrant,
provided that if any such Holder shall fail to make any such request, the failure shall not affect the continuing obligation of the Issuer to afford such rights to such Holder. 
  

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 (g) Compliance with Securities Laws. 
 (i) The Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant and the shares of Warrant Stock to be issued upon
exercise hereof are being acquired solely for the Holder’s own account and not as a nominee for any other party, and for investment, and that the Holder will not offer, sell or otherwise dispose of this Warrant or any shares of Warrant Stock to
be issued upon exercise hereof except pursuant to an effective registration statement, or an exemption from registration, under the Securities Act and any applicable state securities laws. 
 (ii) Except as provided in paragraph (iii) below, this Warrant and all certificates representing shares of Warrant Stock issued upon
exercise hereof shall be stamped or imprinted with a legend in substantially the following form: 
 THIS WARRANT AND THE SECURITIES ISSUABLE
UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES
ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED. 
 (iii) The Issuer agrees to reissue this Warrant or certificates representing any of the
Warrant Stock, without the legend set forth above if at such time, prior to making any transfer of any such securities, the Holder shall give written notice to the Issuer describing the manner and terms of such transfer. Such proposed transfer will
not be effected until: (a) either (i) the Issuer has received an opinion of counsel reasonably satisfactory to the Issuer, to the effect that the registration of such securities under the Securities Act is not required in connection with
such proposed transfer, (ii) a registration statement under the Securities Act covering such proposed disposition has been filed by the Issuer with the Securities and Exchange Commission and has become effective under the Securities Act,
(iii) the Issuer has received other evidence reasonably satisfactory to the Issuer that such registration and qualification under the Securities Act and state securities laws are not required, or (iv) the Holder provides the Issuer with
reasonable assurances that such security can be sold pursuant to Rule 144 under the Securities Act; and (b) either (i) the Issuer has received an opinion of counsel reasonably satisfactory to the Issuer, to the effect that registration or
qualification under the securities or “blue sky” laws of any state is not required in connection with such proposed disposition, or (ii) compliance with applicable state securities or “blue sky” laws has been effected or a
valid exemption exists with respect thereto. The Issuer will respond to any such notice from a holder within three (3) Trading Days. In the case of any proposed transfer under this Section 2(g), the Issuer will use reasonable efforts to
comply with any such applicable state securities or “blue sky” laws, but shall in no event be required, (x) to qualify to do business in any state where it is not then qualified, (y) to take any action that would subject it to
tax or to the general service of process in any state where it is not then subject, or (z) to comply with state securities or “blue sky” laws of any state for which registration by coordination is unavailable to the Issuer. The
restrictions on transfer contained in this Section 2(g) shall be in addition to, and not by way of limitation of, any other restrictions on transfer contained in any other section of this Warrant. Whenever a certificate representing the Warrant
Stock is required to be issued to a the Holder without a legend, in lieu of delivering physical certificates representing the Warrant Stock, the Issuer shall cause its transfer agent to electronically transmit the Warrant Stock to the Holder by
crediting the account of the Holder’s Prime Broker with DTC through its DWAC system (to the extent not inconsistent with any provisions of this Warrant). 
 (h) Accredited Investor Status. In no event may the Holder exercise this Warrant in whole or in part unless the Holder is an “accredited investor” as defined in Regulation D under the Securities Act.

 (i) No Mandatory Redemption. This Warrant may not be called or redeemed by the Issuer without the written consent of the Holder.

  

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 3. Stock Fully Paid; Reservation and Listing of Shares; Covenants. 
 (a) Stock Fully Paid. The Issuer represents, warrants, covenants and agrees that all shares of Warrant Stock which may be issued upon the exercise
of this Warrant or otherwise hereunder will, when issued in accordance with the terms of this Warrant, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges created by or through the Issuer. The
Issuer further covenants and agrees that during the period within which this Warrant may be exercised, the Issuer will at all times have authorized and reserved for the purpose of the issuance upon exercise of this Warrant a number of authorized but
unissued shares of Series D Preferred Stock equal to at least one hundred percent (100%) of the number of shares of Series D Preferred Stock issuable upon exercise of this Warrant without regard to any limitations on exercise. 
 (b) Reservation. If any shares of Series D Preferred Stock required to be reserved for issuance upon exercise of this Warrant or as otherwise
provided hereunder require registration or qualification with any Governmental Authority under any federal or state law before such shares may be so issued, the Issuer will in good faith use its best efforts as expeditiously as possible at its
expense to cause such shares to be duly registered or qualified. If the Issuer shall list any shares of Series D Preferred Stock on any securities exchange or market it will, at its expense, list thereon, and maintain and increase when necessary
such listing, of, all shares of Warrant Stock from time to time issued upon exercise of this Warrant or as otherwise provided hereunder (provided that such Warrant Stock has been registered pursuant to a registration statement under the Securities
Act then in effect), and, to the extent permissible under the applicable securities exchange rules, all unissued shares of Warrant Stock which are at any time issuable hereunder, so long as any shares of Series D Preferred Stock shall be so listed.
The Issuer will also so list on each securities exchange or market, and will maintain such listing of, any other securities which the Holder of this Warrant shall be entitled to receive upon the exercise of this Warrant if at the time any securities
of the same class shall be listed on such securities exchange or market by the Issuer. 
 (c) Loss, Theft, Destruction of Warrants.
Upon receipt of evidence satisfactory to the Issuer of the ownership of and the loss, theft, destruction or mutilation of any Warrant and, in the case of any such loss, theft or destruction, upon receipt of indemnity or security satisfactory to the
Issuer or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Issuer will make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to
purchase the same number of shares of Series D Preferred Stock. 
 (d) Payment of Taxes. The Issuer will pay any documentary stamp
taxes attributable to the initial issuance of the Warrant Stock issuable upon exercise of this Warrant; provided, however, that the Issuer shall not be required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificates representing Warrant Stock in a name other than that of the Holder in respect to which such shares are issued. 
 4. Adjustment of Warrant Price and Number of Shares Issuable Upon Exercise. The Warrant Price and the number of shares of Warrant Stock that may be purchased upon exercise of this Warrant shall be subject to
adjustment from time to time as set forth in this Section 4. Upon each adjustment of the Warrant Price, the Holder of this Warrant shall thereafter be entitled to purchase, at the Warrant Price resulting from such adjustment, the number of
shares of Series D Preferred Stock obtained by multiplying the Warrant Price in effect immediately prior to such adjustment by the number of shares purchasable pursuant hereto immediately prior to such adjustment, and dividing the product thereof by
the Warrant Price resulting from such adjustment. 
 (a) Adjustment Due to Dividends, Stock Splits, Etc. If, at any time on or after
the Original Issuance Date, the number of outstanding shares of Series D Preferred Stock is increased by a (i) dividend payable in any kind of shares of capital stock of the Corporation, (ii) stock split, (iii) combination,
(iv) reclassification or (v) other similar event, the Conversion Price shall be proportionately reduced by multiplying the Warrant Price by a fraction of which the numerator shall be the number of outstanding shares of Series D Preferred
Stock immediately before such event and of which the denominator shall be the number of outstanding shares of Series D Preferred Stock immediately after such event, or if the number of outstanding shares of Series D Preferred Stock is decreased by a
reverse stock split, combination or reclassification of shares, or other similar event, the Conversion Price shall be proportionately increased by multiplying the Warrant Price by a fraction of which the numerator shall be the number of outstanding
shares of Series D Preferred Stock immediately before such event and of which the denominator shall be the number of outstanding shares of Series D Preferred Stock immediately after such event. In such event, the Issuer shall notify the
Corporation’s Transfer Agent of such change on or before the effective date thereof. 
  

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 (b) Adjustment Due to Merger, Consolidation, Etc. If, at any time after the Original Issuance
Date, there shall be (i) any reclassification or change of the outstanding shares of Series D Preferred Stock or Common Stock, (ii) any consolidation or merger of the Corporation with any other entity (other than a merger in which the
Corporation is the surviving or continuing entity and its capital stock is unchanged), (iii) any sale or transfer of all or substantially all of the assets of the Corporation, (iv) any share exchange or tender offer pursuant to which all
of the outstanding shares of Series D Preferred Stock or Common Stock are effectively converted into other securities or property; or (v) any distribution of the Corporation’s assets to holders of the Series D Preferred Stock as a
liquidation or partial liquidation dividend or by way of return of capital (each of (i) - (v) above being a “Corporate Change”), and, if such Corporate Change is not a Liquidation Event pursuant to the terms of Paragraph 5, then the
Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Corporate Change if it had been,
immediately prior to such Corporate Change, the holder of the number of shares of Warrant Stock then issuable upon exercise in full of this Warrant, and in any such case, appropriate provisions (in form and substance reasonably satisfactory to the
Holder) shall be made with respect to the rights and interests of the Holder to the end that the economic value of the Warrant Stock is in no way diminished by such Corporate Change and that the provisions hereof including, without limitation, in
the case of any such consolidation, merger or sale in which the successor entity or purchasing entity is not the Issuer, an immediate adjustment of the Warrant Price so that the Warrant Price immediately after the Corporate Change reflects the same
relative value as compared to the value of the surviving entity’s common stock that existed immediately prior to such Corporate Change and the value of the Series D Preferred Stock immediately prior to such Corporate Change. If holders of
Series D Preferred Stock are given any choice as to the securities, cash or property to be received in a Corporate Change, then the Holder shall be given the same choice as to the consideration it receives upon any exercise of this Warrant following
such Corporate Change. 
 (c) Other Adjustments. If the Issuer takes any action affecting the Series D Preferred Stock after the date
hereof that would be covered by this Section 4, but for the manner in which such action is taken or structured, and such action would in any way diminish the value of the Warrant or Warrant Stock, then the Warrant Price shall be adjusted in
such manner as the Board shall in good faith determine to be equitable under the circumstances. 
 (d) Purchase Rights. In addition to
any adjustments pursuant to subsections (a)-(d) above, if at any time the Issuer are grants, issues or sells any options, convertible securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders
of any class of shares of common stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if
the Holder had held the proportionate number of shares of Series D Preferred Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) immediately before the date on which a record is
taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Series D Preferred Stock are to be determined for the grant, issue or sale of such Purchase Rights.

 (e) Redemption Right. No sooner than fifteen (15) days nor later than ten (10) days prior to the consummation of a
Corporate Change that constitutes a change of control, but not prior to the public announcement of such change of control, the Issuer shall deliver written notice thereof via facsimile and overnight courier to the Holder (a “Change in
Control Notice”). At any time during the period beginning after the Holder’s receipt of a Change of Control Notice and ending ten (10) Trading Days after the consummation of such change of control, the Holder may require the
Issuer to redeem all or any portion of this Warrant by delivering written notice thereof (“Change in Control Redemption Notice”) to the Issuer, which Change of Control Redemption Notice shall indicate the amount the Holder is
electing to be redeemed. Any such redemption shall be in cash in the amount equal to the value of the remaining unexercised portion of this Warrant on the date of such consummation, which value shall be determined by use of the Black Scholes Option
Pricing Model reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of such date of request and (B) an expected volatility equal to the 100-day
volatility obtained from the HVT function on Bloomberg for the 100-day period ending on the date of the Change of Control Redemption Notice. 
  

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 5. Notice of Adjustments. Whenever the Warrant Price or Warrant Share Number shall be adjusted
pursuant to Section 4 hereof (for purposes of this Section 5, each an “adjustment”), the Issuer shall cause its Chief Financial Officer to prepare and execute a certificate setting forth, in reasonable detail, the event
requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated (including a description of the basis on which the Board made any determination hereunder), and the Warrant Price and Warrant Share Number
after giving effect to such adjustment, and shall cause copies of such certificate to be delivered to the Holder of this Warrant promptly after each adjustment. Any dispute between the Issuer and the Holder of this Warrant with respect to the
matters set forth in such certificate may at the option of the Holder of this Warrant be submitted to a national or regional accounting firm reasonably acceptable to the Issuer and the Holder, provided that the Issuer shall have ten
(10) days after receipt of notice from such Holder of its selection of such firm to object thereto, in which case such Holder shall select another such firm and the Issuer shall have no such right of objection. The firm selected by the Holder
of this Warrant as provided in the preceding sentence shall be instructed to deliver a written opinion as to such matters to the Issuer and such Holder within thirty (30) days after submission to it of such dispute. Such opinion shall be final
and binding on the parties hereto. The costs and expenses of the initial accounting firm shall be paid equally by the Issuer and the Holder and, in the case of an objection by the Issuer, the costs and expenses of the subsequent accounting firm
shall be paid in full by the Issuer. 
 6. Definitions. For the purposes of this Warrant, the following terms have the following
meanings: 
 “Additional Shares of Series D Preferred Stock” means all shares of Series D Preferred Stock
issued by the Issuer after the Original Issue Date, and all shares of Other Common, if any, issued by the Issuer after the Original Issue Date, except for those issued in a Permitted Financing. 
 “Board” shall mean the Board of Directors of the Issuer. 
 “Capital Stock” means and includes (i) any and all shares, interests, participations or other equivalents of or
interests in (however designated) corporate stock, including, without limitation, shares of preferred or preference stock, (ii) all partnership interests (whether general or limited) in any Person which is a partnership, (iii) all
membership interests or limited liability company interests in any limited liability company, and (iv) all equity or ownership interests in any Person of any other type. 
 “Certificate of Incorporation” means the Certificate of Incorporation of the Issuer as in effect on the Original Issue
Date, and as hereafter from time to time amended, modified, supplemented or restated in accordance with the terms hereof and thereof and pursuant to applicable law. 
 “Conversion Factor” means the rate at which the Series D Preferred Stock converts into Common Stock, at the time of the
issue of this warrant, the Conversion Factor is 100,000. 
 “Common Stock” means the Common Stock, $0.01 par
value per share, of the Issuer and any other Capital Stock into which such stock may hereafter be changed. 
 “Governmental Authority” means any governmental, regulatory or self-regulatory entity, department, body, official, authority, commission, board, agency or instrumentality, whether federal, state or local, and whether
domestic or foreign. 
 “Holders” mean the Persons who shall from time to time own any Warrant. The term
“Holder” means one of the Holders. 
 “Independent Appraiser” means a nationally recognized or
major regional investment banking firm or firm of independent certified public accountants of recognized standing (which may be the firm that regularly examines the financial statements of the Issuer) that is regularly engaged in the business of
appraising the Capital Stock or assets of corporations or other entities as going concerns, and which is not affiliated with either the Issuer or the Holder of any Warrant. 
 “Issuer” means Comprehensive Care Corporation, a Delaware corporation, and its successors. 
 “Original Issue Date” means May 13, 2009. 
  

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 “OTC Bulletin Board” means the over-the-counter electronic bulletin
board. 
 “Other Common” means any other Capital Stock of the Issuer of any class which shall be authorized
at any time after the date of this Warrant (other than Series D Preferred Stock) and which shall have the right to participate in the distribution of earnings and assets of the Issuer without limitation as to amount. 
 “Outstanding Series D Preferred Stock” means, at any given time, the aggregate amount of outstanding shares of Series D
Preferred Stock, assuming full exercise, conversion or exchange (as applicable) of all options, warrants and other Securities which are convertible into or exercisable or exchangeable for, and any right to subscribe for, shares of Series D Preferred
Stock that are outstanding at such time. 
 “Person” means an individual, corporation, limited liability
company, partnership, joint stock company, trust, unincorporated organization, joint venture, Governmental Authority or other entity of whatever nature. 
 “Per Share Market Value” means on any particular date the per share market price of the Common Stock multiplied by the Conversion Factor where the per share market price of the Common Stock means,
(a) the last closing bid price per share of the Common Stock on such date on the OTC Bulletin Board or another registered national stock exchange on which the Common Stock is then listed, or if there is no such price on such date, then the
closing bid price on such exchange or quotation system on the date nearest preceding such date, or (b) if the Common Stock is not listed then on the OTC Bulletin Board or any registered national stock exchange, the last closing bid price for a
share of Common Stock in the over-the-counter market, as reported by the OTC Bulletin Board or in the National Quotation Bureau Incorporated or similar organization or agency succeeding to its functions of reporting prices) at the close of business
on such date, or (c) if the Common Stock is not then reported by the OTC Bulletin Board or the National Quotation Bureau Incorporated (or similar organization or agency succeeding to its functions of reporting prices), then the “Pink
Sheet” quotes for the applicable Trading Days preceding such date of determination, or (d) if the Common Stock is not then publicly traded the fair market value of a share of Common Stock as determined by an Independent Appraiser selected
in good faith by the Holder; provided, however, that the Issuer, after receipt of the determination by such Independent Appraiser, shall have the right to select an additional Independent Appraiser, in which case, the fair market value
shall be equal to the average of the determinations by each such Independent Appraiser; and provided, further that all determinations of the Per Share Market Value shall be appropriately adjusted for any stock dividends, stock splits
or other similar transactions during such period. The determination of fair market value by an Independent Appraiser shall be based upon the fair market value of the Issuer determined on a going concern basis as between a willing buyer and a willing
seller and taking into account all relevant factors determinative of value, and the determination of the additional Independent Appraiser, if any, or of the Independent Appraisers otherwise shall be final and binding on all parties. In determining
the fair market value of any shares of Series D Preferred Stock or Common Stock, no consideration shall be given to any restrictions on transfer of the Series D Preferred Stock or Common Stock imposed by agreement or by federal or state securities
laws, or to the existence or absence of, or any limitations on, voting rights. 
 “Securities” means any debt
or equity securities of the Issuer, whether now or hereafter authorized, any instrument convertible into or exchangeable for Securities or a Security, and any option, warrant or other right to purchase or acquire any Security. “Security”
means one of the Securities. 
 “Securities Act” means the Securities Act of 1933, as amended, or any similar
federal statute then in effect. 
 “Series D Preferred Stock” means the Series D Preferred Stock, $50.00 par
value per share, of the Issuer and any other Capital Stock into which such stock may hereafter be changed. 
  

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 “Subsidiary” means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the Issuer or by one or more of its Subsidiaries, or by the Issuer and one or more of its Subsidiaries. 
 “Term” has the meaning specified in Section 1 hereof. 
 “Trading Day” means (a) a day on which the Common Stock is traded on the OTC Bulletin Board, or (b) if the
Common Stock is not traded on the OTC Bulletin Board, a day on which the Common Stock is quoted in the over-the-counter market as reported by the National Quotation Bureau Incorporated (or any similar organization or agency succeeding its functions
of reporting prices); provided, however, that in the event that the Common Stock is not listed or quoted as set forth in (a) or (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and any day which shall
be a legal holiday or a day on which banking institutions in the State of New York are authorized or required by law or other government action to close. 
 “Voting Stock” means, as applied to the Capital Stock of any corporation, Capital Stock of any class or classes (however designated) having ordinary voting power for the election of a majority of the
members of the Board of Directors (or other governing body) of such corporation, other than Capital Stock having such power only by reason of the happening of a contingency. 
 “Warrants” means the Warrants issued pursuant to this Warrant, without limitation, and any other warrants of like tenor
issued in substitution or exchange for any thereof pursuant to the provisions of Section 2(c), 2(d) or 2(e) hereof or of any of such other Warrants. 
 “Warrant Price” initially means $25,000.00 (TWENTY FIVE THOUSAND DOLLARS), as such price may be adjusted from time to time as shall result from the adjustments specified in this Warrant, including
Section 4 hereto. 
 “Warrant Share Number” means at any time the aggregate number of shares of Warrant
Stock which may at such time be purchased upon exercise of this Warrant, after giving effect to all prior adjustments and increases to such number made or required to be made under the terms hereof. 
 “Warrant Stock” means Series D Preferred Stock issuable upon exercise of any Warrant or Warrants or otherwise issuable
pursuant to any Warrant or Warrants. 
 7. Other Notices. In case at any time: 
  

	 	(a)	the Issuer shall make any distributions to the holders of Series D Preferred Stock; or 

  

	 	(b)	the Issuer shall authorize the granting to all holders of its Series D Preferred Stock of rights to subscribe for or purchase any shares of Capital Stock of any class or other
rights; or 

  

	 	(c)	there shall be any reclassification of the Capital Stock of the Issuer; or 

  

	 	(d)	there shall be any capital reorganization by the Issuer; or 

  

	 	(e)	there shall be any (i) consolidation or merger involving the Issuer or (ii) sale, transfer or other disposition of all or substantially all of the Issuer’s property,
assets or business (except a merger or other reorganization in which the Issuer shall be the surviving corporation and its shares of Capital Stock shall continue to be outstanding and unchanged and except a consolidation, merger, sale, transfer or
other disposition involving a wholly-owned subsidiary); or 

  

	 	(f)	there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Issuer or any partial liquidation of the Issuer or distribution to holders of Series D
Preferred Stock; 

 then, in each of such cases, the Issuer shall give written notice to the Holder of the date on which (i) the books of
the Issuer shall close or a record shall be taken for such dividend, distribution or subscription rights or (ii) such 

  

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reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be, shall take place. Such
notice also shall specify the date as of which the holders of Series D Preferred Stock of record shall participate in such dividend, distribution or subscription rights, or shall be entitled to exchange their certificates for Series D Preferred
Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be. Such notice shall be given at least twenty (20) days
prior to the action in question and not less than ten (10) days prior to the record date or the date on which the Issuer’s transfer books are closed in respect thereto. This Warrant entitles the Holder to receive copies of all financial
and other information distributed or required to be distributed to the holders of the Series D Preferred Stock. 
 8. Amendment and
Waiver. Any term, covenant, agreement or condition in this Warrant may be amended, or compliance therewith may be waived (either generally or in a particular instance and either retroactively or prospectively), by a written instrument or written
instruments executed by the Issuer and the Holder; provided, however, that no such amendment or waiver shall reduce the Warrant Share Number, increase the Warrant Price, shorten the period during which this Warrant may be exercised or
modify any provision of this Section 8 without the consent of the Holder of this Warrant. No consideration shall be offered or paid to any person to amend or consent to a waiver or modification of any provision of this Warrant unless the same
consideration is also offered to all holders of the Warrants. 
 9. Governing Law; Jurisdiction. This Warrant shall be governed by and
construed in accordance with the internal laws of the State of Florida, without giving effect to any of the conflicts of law principles which would result in the application of the substantive law of another jurisdiction. This Warrant shall not be
interpreted or construed with any presumption against the party causing this Warrant to be drafted. The Issuer and the Holder agree that venue for any dispute arising under this Warrant will lie exclusively in the state or federal courts located in
Hillsborough County, Florida, and the parties irrevocably waive any right to raise forum non conveniens or any other argument that Florida is not the proper venue. The Issuer and the Holder irrevocably consent to personal jurisdiction in the
state and federal courts of the state of Florida. The Issuer and the Holder consent to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address in effect for notices to it under this Warrant
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing in this Section 9 shall affect or limit any right to serve process in any other manner permitted by law. The Issuer agrees to pay
all costs and expenses of enforcement of this Warrant, including, without limitation, reasonable attorneys’ fees and expenses. The parties hereby waive all rights to a trial by jury. 
 10. Notices. All notices, requests, consents or other communications required or permitted hereunder shall be in writing and shall be hand
delivered or mailed first class postage prepaid, registered or certified mail, to the following address: 
 In the case of the Issuer:

 John Hill, Co-Chief Executive Officer 
 Comprehensive Care Corporation 
 3405 W. Martin Luther King Jr. Blvd, Suite 101 
 Tampa, FL 33607 
 In the case of the Holder:

  

					
	  
 	 	  	 	  
	  
 	 	  	 	  
	  
 	 	  	 	  
	  
 	 	  	 	  

 Such notices and other communications shall, for all purposes of this Agreement, be treated as
being effective upon being delivered personally or, if sent by mail, five days after the same has been deposited in a regularly maintained receptacle for the deposit of United States mail, addressed as set forth above, and postage prepaid. Any party
hereto may from time to time change its address for notices by giving written notice of such changed address to the other party hereto. 
  

 -52- 

 11. Remedies. The Issuer stipulates that the remedies at law of the Holder of this Warrant in the
event of any default or threatened default by the Issuer in the performance of or compliance with any of the terms of this Warrant are not and will not be adequate and that, to the fullest extent permitted by law, such terms may be specifically
enforced by a decree for the specific performance of any agreement contained herein or by an injunction against a violation of any of the terms hereof or otherwise. 
 12. Successors and Assigns. This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors and assigns of the Issuer, the Holder hereof and (to the extent provided
herein) the Holders of Warrant Stock issued pursuant hereto, and shall be enforceable by any such Holder or Holder of Warrant Stock. 
 13.
Modification and Severability. If, in any action before any court or agency legally empowered to enforce any provision contained herein, any provision hereof is found to be unenforceable, then such provision shall be deemed modified to the
extent necessary to make it enforceable by such court or agency. If any such provision is not enforceable as set forth in the preceding sentence, the unenforceability of such provision shall not affect the other provisions of this Warrant, but this
Warrant shall be construed as if such unenforceable provision had never been contained herein. 
 14. Headings. The headings of the
Sections of this Warrant are for convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant. 
 [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK] 
  

 -53- 

 IN WITNESS WHEREOF, the Issuer has executed this Warrant as of the day and year first above written.

  

			
	 COMPREHENSIVE CARE CORPORATION

		
	 By:
	 	  

		
		 	  

		
		 	  

  

 -54- 

 APPENDIX A 
 WARRANT EXERCISE FORM 
 COMPREHENSIVE CARE CORPORATION 
 The undersigned                     , pursuant to the provisions of
the within Warrant, hereby elects to purchase              shares of Series D Preferred Stock of Comprehensive Care Corporation covered by the within Warrant. 
  

									
	Dated:	 	  
	 		 	Signature	 	  

					
		 		 		 	Address	 	  

		 		 		 		 	  

 Number of shares of Series D Preferred Stock beneficially owned or deemed beneficially owned by the Holder on the
date of Exercise:
                                        

 The undersigned is an “accredited investor” as defined in Regulation D under the Securities Act of 1933, as amended. 
 The undersigned intends that payment of the Warrant Price shall be made as (check one): 
 Cash Exercise              
 Cashless
Exercise              
 If the Holder has elected a Cash Exercise, the Holder shall pay
the sum of $              by certified or official bank check (or via wire transfer) to the Issuer in accordance with the terms of the Warrant. 
 If the Holder has elected a Cashless Exercise, a certificate shall be issued to the Holder for the number of shares equal to the whole number portion of the product of
the calculation set forth below, which is                     . The Company shall pay a cash adjustment in respect of the fractional portion of the
product of the calculation set forth below in an amount equal to the product of the fractional portion of such product and the Per Share Market Value on the date of exercise, which product is
                    . 
  

			
	 Where:
	 	

 The number of shares of Series D Preferred Stock to be issued to the Holder
                                        
(“X”). 
 The number of shares of Series D Preferred Stock purchasable upon exercise of all of the Warrant or, if only a portion of the Warrant is
being exercised, the portion of the Warrant being exercised
                                        
(“Y”). 
 The Warrant Price
                     (“A”). 
 The Per Share
Market Value of one share of Series D Preferred Stock                      (“B”). 

 COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES 
 ASSIGNMENT 
 FOR VALUE RECEIVED,
                     hereby sells, assigns and transfers unto
                     the within Warrant and all rights evidenced thereby and does irrevocably constitute and appoint
                    , attorney, to transfer the said Warrant on the books of the within named corporation. 
  

									
	Dated:	 	  
	 		 	Signature	 	  

					
		 		 		 	Address	 	  

		 		 		 		 	  

 PARTIAL ASSIGNMENT 
 FOR VALUE RECEIVED,                      hereby sells, assigns and transfers unto
                     the right to purchase              shares of Warrant Stock evidenced
by the within Warrant together with all rights therein, and does irrevocably constitute and appoint                     , attorney, to transfer that
part of the said Warrant on the books of the within named corporation. 
  

									
	Dated:	 	  
	 		 	Signature	 	  

					
		 		 		 	Address	 	  

		 		 		 		 	  

 FOR USE BY THE ISSUER ONLY: 
 This Warrant No. W-             canceled (or transferred or exchanged) this              day of
            ,         , shares of Series D Preferred Stock issued therefore in the name of
                    , Warrant No. W-             issued for
             shares of Series D Preferred Stock in the name of                     .

  

 56 

 COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES 
 APPENDIX B 
 CASHLESS CONVERSION
EXAMPLE 
  

			
	Example:	 	One year following issue of Warrant, Holder of 10 warrants wishes to exercise all the warrants on a cashless basis pursuant to Section 2 (c). On that date, CompCare’s FMV as
determined by its closing share price for its Common Stock was $1.25 per share (in accordance with the definition of Per Share Market Value provided in Section 7).

 Using the following formula: 
 

 
  

					
	Where	  	X =	  	the number of shares of Series D Preferred Stock to be issued to the Holder.
			
		  	Y =	  	the number of shares of Series D Preferred Stock purchasable upon exercise of all of the Warrant, in this example, this will be 10.
			
		  	A =	  	the Warrant Price, being $25,000 per Series D share.
			
		  	B =	  	the Per Share Market Value of one share of Series D Preferred Stock, in this example using the definition provided in Section 7, being the share price for the Series D stock will be the share
price for the Common Stock multiplied by the Conversion Factor. In this example, this will be $1.25 multiplied by 100,000 = $125,000.

 Thus: 
 

 
  

					
	Therefore	  	X = 8	 	Series D Shares

 In this example, the Holder can request a cashless exercise of the full 10 warrants and receive 8 Series D
Preferred Stock in return. Note that the Warrant will now be canceled in its entirety and be deemed fully exercised. Where the Warrant Share Number was for greater than 10 warrants, a new warrant will be issued where the new Warrant Share Number
will be the existing Warrant Share Number prior to the cashless conversion less 10. 
  

 57exhibit_10-4.htm

    
      

    

    EXHIBIT
10.4

     

    
      
        
          
            	
                    

                  	 	
                    "Authorized
      Personnel" and on the Retailer's representation, warranty and assurance
      that the personal services of such person(s) will be provided in the
      operations and management of the Retailership. ZMC is entering into this
      Agreement in reliance on the representation and warranty of the Retailer
      that Schedule F hereto fully and accurately identifies all persons having
      any direct or indirect legal or beneficial interest in the Retailer and
      the nature of any such interest. The Retailer shall promptly notify ZMC of
      changes in its management or any direct or indirect changes in its
      ownership including without limitation any changes in the interests held
      by the persons identified in Schedule F. ZMC reserves the right to
      terminate this Agreement if there is any change in the direct or indirect
      ownership or operating management of Retailer which would adversely affect
      ZMC, however accomplished, without the written consent of ZMC, such
      consent not to be unreasonably withheld.   

                     

                    1.5          
      Volume Commitment.   

                     

                    Retailer
      agrees to purchase a minimum quantity of Products each year as identified
      in Schedule "A", such Schedule to be reviewed and updated annually as
      applicable 60 days prior to the anniversary of this Agreement. In the
      event of Retailer failing to meet any Minimum Commitment during the Term,
      Retailer may make up the shortfall in the following quarter, however in
      the event that Retailer fails to meet its Minimum Commitment by the end of
      said following quarter, ZMC may terminate this
      Agreement.

                     

                    2             
      RESPONSIBILITIES OF RETAILER   

                     

                    2.1          
      Best Interest of ZMC.   

                     

                    Retailer
      shall use its reasonable commercial efforts to market, sell and distribute
      the Products within the Territory and shall, at all times, serve and
      promote the best interest of ZMC. Retailer shall not engage in any
      activities, practices or business endeavors that
      would:    
      

                     

                    (a)         
        hinder
      ZMC's ability to perform its obligations
      hereunder;    
      

                     

                    (b)         
      reflect
      adversely upon the reputation of ZMC, its employees, or sales
      organization;    
      

                     

                    (c)           diminish
      or detract from the sales potential of the Products or their
      attractiveness to customers; or    
      

                     

                    (d)           constitute
      a false or misleading representation to a customer, or others regarding
      ZMC or the Products. Retailer shall not make any representations,
      warranties or guarantees with respect to the Products or the
      specifications, features or capabilities of the Products or publish any
      technical description of the Products, except as expressly set forth in
      ZMC's documentation accompanying the Products or ZMC's literature
      describing the Products.

                  
	

                    RETAILER
      AGREEMENT

                     

                    (the
      "Agreement")

                     

                    
                      THIS
      AGREEMENT made
      the 10
      day of September, 2008

                       

                      BETWEEN:
      ZENN
      MOTOR COMPANY LIMITED, a corporation incorporated pursuant to the
      laws of the Canadian Province of Ontario, ("ZMC") whose address is 85
      Scarsdale Road, Suite 100, Toronto, Ontario, M3B 2R2, and EVCARCO,
      INC. DBA EVCarCo.com    , a corporation
      incorporated
      pursuant
      to
      the
      laws
      of
      Nevada ("Retailer")whose
      address is
      7703
      SAND ST. FORT WORTH, TX
      76118               ;

                       

                      WHEREAS
      Retailer desires to distribute the products identified in Schedule
      "A" and/or any products periodically supplied to Retailer by ZMC for
      distribution in accordance with the terms of this Agreement (the "Products");

                       

                      AND
      WHEREAS ZMC desires to appoint Retailer as a Retailer of the
      Products in the geographic territory identified in Schedule "A" (the "Territory");

                       

                      NOW
      THEREFORE in consideration of the foregoing and the mutual
      agreements contained herein (the receipt and adequacy of which are
      acknowledged), the parties agree as follows:

                       

                      1             
      DISTRIBUTION RIGHTS

                       

                      1.1          
      Rights.

                       

                      ZMC
      grants to Retailer and Retailer accepts the non-exclusive right to market
      and distribute the Products, in the form provided by ZMC, within the
      Territory during the term of this Agreement. Retailer shall not actively
      promote the Products, solicit customer orders or establish distribution
      facilities outside the Territory, without the expressed written consent
      from ZMC. Notwithstanding the foregoing this agreement specifically
      excludes selling to sub- Retailers, re-sellers, or retail retailers in the
      Territory.

                       

                      1.2          
      Rights Reserved to ZMC.

                       

                      Notwithstanding
      the above, ZMC reserves the right to market and sell directly to the
      Federal Government and it's agencies or to Fleet Sale opportunities in
      accordance with the program as outlined in Schedule C, or as amended by
      ZMC from time to time. ZMC may terminate Retailer's rights to any specific
      Product immediately upon written notice for Retailer's failure to meet
      it's obligations as set out in this Agreement. Upon receipt of such
      notice, Retailer shall cease its marketing, selling, distribution, import
      and export of such Products within the time period specified in such
      notice but in any event not more than 90 days.

                       

                      1.3          
      Changes and Improvements

                       

                      ZMC
      shall have the right to discontinue selling any model or line of
      Automobiles, Parts and Accessories without incurring any obligation or
      liability to the Retailer. ZMC shall have the right to make changes in the
      design of or add improvements to any of the Products, at any time, without
      incurring any obligation or liability to the Retailer to make or install
      the same on any Products ordered by the Retailer prior to such change or
      addition.

                       

                      1.4           Management
      and Ownership

                       

                      ZMC is entering into
      this Agreement in reliance on the capabilities of
      the person(s) identified in Schedule "F" hereto
    entitled

                    

                  	 

          

        

      

    

     

    Initials
/s/ DL /s/ DH

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      
        	

                2.2          
      Changes to Premises

                 

                The
      Retailer shall not move or substantially modify or change the usage of any
      of the facilities which comprise the retailership premises, nor shall the
      Retailer directly or indirectly establish or operate in whole or in part
      any other locations or facilities for the sale or service of the Products
      or the sale of used vehicles, unless in any such case the Retailer has
      established to the satisfaction of ZMC that such move, modification or
      change is in the best interests of the Retailer and ZMC, and ZMC has given
      its prior written consent thereto, such consent not to be unreasonably
      withheld .

                 

                2.3           Personnel

                 

                The
      Retailer shall employ such numbers and classifications of properly trained
      and competent sales and service personnel of good character as will enable
      the Retailer to fulfill all of its obligations hereunder in a timely and
      effective manner.

                 

                2.4           Insurance

                 

                The Retailer shall at its own
      expense maintain a comprehensive general liability insurance
      policy or policies against all types of risks and liability protecting the
      Retailer and ZMC and their respective officers and employees against
      any loss, liability or expense due to claims resulting from or arising
      out of personal injury, death or property damage or otherwise
      arising out of or occurring in connection with the retailership.
      The Retailer shall keep the Retailership premises and the
      Products in the Retailer's possession insured, for full
      replacement value, against loss or damage. Such policy or policies
      shall be with such insurers and in such amounts as is customary in
      the trade. Further, such policy or policies shall provide that the
      insurer will give ZMC at least thirty (30) days' written notice prior
      to any material alteration, cancellation or termination for
      any cause. The Retailer shall upon request provide ZMC with evidence
      satisfactory to ZMC of compliance with the foregoing
      terms and conditions. Notwithstanding the foregoing,
      ZMC shall not be responsible for providing insurance of any
      description.

                 

                2.5          
      Reporting.

                 

                Retailer
      shall submit to ZMC the following regular reports in a format from time to
      time specified by ZMC:

                 

                (a)           
      end-of-month
      inventory report by Product and Retailer stocking location;

                 

                
                  (b)           
      monthly
      sales-out data by customer and by Product

                

                 

                
                  (c)           
      upon
      execution of this Agreement and within ten (10) days from the end of each
      calendar month thereafter, Retailer will provide ZMC with a written
      forecast setting forth Retailer's anticipated monthly needs for
      the delivery of Products during the four (4) calendar months period
      including current month beginning immediately after the month in which the
      forecast is provided; and

                

                 

                
                  (d)           
      annual
      marketing plan for the sale ZMC Products within the Territory, updated
      quarterly or as otherwise requested by ZMC.

                

                 

                2.7          
      Stocking Levels.

                 

                Retailer
      agrees to maintain a reasonable amount of inventory of each Product in
      each stocking location and at minimum shall at all times have a minimum of
      four ZENN vehicles in stock with at least one ZENN vehicle on display at
      its Retailership for customer demonstration purposes.

                 

                2.8          
      No Modifications of Products.

              	 	
                Retailer
      shall immediately report to ZMC any technical problems in the Products
      discovered by or reported to Retailer. Retailer shall not make or
      authorize any third party to make any alterations or modifications to the
      Products except as authorized in writing by ZMC or as provided for in the
      ZMC Warranty.

                 

                3              
      RESPONSIBILITIES OF ZMC

                 

                3.1           
      Product Training.

                 

                ZMC
      may offer initial or periodic training, and other promotional activities
      at Retailer's site. All activities are subject to mutual agreement and
      each party shall bear its own costs relating to such
training.

                 

                3.2          
      General Promotional Material.

                 

                ZMC
      shall make available to the Retailer English language literature and price
      lists. All Retailer-generated materials about the Products for mailing
      and/or publication must receive prior approval from ZMC. ZMC reserves the
      right to limit any promotional and/or advertising activities which are in
      its opinion detrimental to ZMC. Retailer shall not use any ZMC trade name
      or mark on any service or product other than the Products.

                 

                3.3           
      Co-Op Advertising Funds

                 

                ZMC
      may from time to time offer a co-op advertising and marketing program, the
      details for which will be communicated in a Retailer
Bulletin.

                 

                3.4           
      Compliance.

                 

                ZMC
      will take all reasonable steps to ensure that the Products are in
      full compliance with all applicable standards, laws or regulations as
      required for sale of Products by Retailer. Retailer shall promptly provide
      ZMC with any and all information useful or necessary to such regulatory
      compliance in the Territory.

                 

                3.5          
      Recalls.

                 

                ZMC
      shall have at all times the right to recall from the end users of the
      products, any defective Products and to replace same at ZMC's
      expense.

                 

                4              
      CONFIDENTIAL INFORMATION

                 

                4.1          
      Confidential Information of ZMC.

                 

                Retailer
      agrees and acknowledges that certain information provided by ZMC pursuant
      to this Agreement, is or encompasses trade secrets or confidential
      information of ZMC or its suppliers ("Confidential Information"). Retailer
      shall not make the Confidential Information available in any form to any
      person other than Retailer's employees whose job performance requires such
      access. Retailer shall take appropriate steps to protect the
      confidentiality of the Confidential Information to ensure that any person
      permitted access to the Confidential Information has signed a written
      non-disclosure agreement with Retailer and does not provide the
      Confidential Information to others. Retailer shall not be liable for the
      disclosure of Confidential Information which: (a) is known to Retailer
      lawfully by its own efforts prior to being received from ZMC; (b) is or
      becomes publicly known through no wrongful act of Retailer; (c) is
      obtained by Retailer lawfully from a third party not having an obligation
      to maintain confidentiality and not being in wrongful possession of the
      confidential information; (d) is independently developed by Retailer
      without breach of this Agreement; (e) is disclosed under operation of law;
      or (f) is disclosed by Retailer with ZMC's prior written
      approval.

              

      

    

     

    Initials
/s/ DL /s/ DH

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    

     

    
      
        
          	

                  5             
      ORDERING OF PRODUCTS

                   

                  5.1          
      Purchase Orders.

                   

                  Retailer
      agrees to issue purchase orders, which may be issued against blanket
      purchase orders (individually an "Order"
      and collectively, "Orders"),
      for all Products in accordance with the terms of this Agreement.
      Each Order shall be in the form of a written or electronic communication
      and shall contain the following information:

                   

                  
                    (a)            a
      description of the Products required;

                  

                   

                  (b)
                 the
      quantity of Products required;

                   

                  (c)          
       the requested delivery date;

                   

                  (d)      
           the location to which the Products are to be
      shipped;

                   

                  
                    (e)           
      the
      location to which invoices shall be sent for payment;
      and

                  

                   

                  
                    (f)             transportation
      instructions.

                  

                   

                  The
      Retailer shall from time to time notify ZMC in writing of the names of
      those individuals who are authorized to order Products on behalf of the
      Retailer. In the event of a conflict between the Order and the terms and
      conditions contained in this Agreement and the Schedules hereto, the terms
      and conditions contained in this Agreement and the Schedules hereto shall
      supersede the Order. Orders for Products are at all times subject to
      acceptance by ZMC, which may be in whole or in part. All orders submitted
      by the Retailer shall be irrevocable by the Retailer unless and until they
      are rejected by ZMC, provided however that in the event of a partial
      acceptance by ZMC the Retailer may withdraw the part of the order not
      accepted.

                   

                  5.2          
      Acceptance of Purchase Orders.

                   

                  No
      modification to any Order, this Agreement or the attachments hereto and no
      inconsistent or additional terms contained in any quotation, purchase
      order, acknowledgment or invoice, shall be valid without the prior written
      consent of an authorized representative of ZMC and Retailer as set forth
      herein and as may be amended from time to time. ZMC's failure to object to
      any provisions contained in any communication from Retailer shall not be
      deemed a waiver of the provisions of this Agreement and the attachments
      hereto. The provisions of this Agreement supersede all prior oral or
      written quotations, communications, agreements and understandings of the
      parties with respect to the subject matter of this Agreement. These terms
      and conditions shall be applicable whether or not they are attached to or
      enclosed with the Products to be sold hereunder.

                   

                  5.2          
      Delivery and Lead-time.

                   

                  All
      Products shall be delivered by ZMC FOB Montreal, Canada unless otherwise
      agreed to in writing by ZMC. Estimated lead-time for delivery of standard
      ZMC Products and regular inventory spare parts covered by this Agreement
      will be ninety (90) days after receipt of an Order acceptable to
      ZMC.

                   

                  5.3          
      Rescheduling/Cancellation.

                   

                  Once
      an Order has been accepted by ZMC by way of a purchase order
      acknowledgement, rescheduling and/or changes to any Orders are to be
      submitted to ZMC in writing and are subject to the following terms.
      Specifically, any Order:

                   

                  
                    (a)            providing
      for delivery or currently scheduled to be delivered within thirty (30)
      days may not be canceled, rescheduled and/or changed;
      and

                  

                   

                  
                    (b)           
      providing
      for delivery in excess of thirty-one (31) days,

                  

                	 	
                  may
      not be cancelled or changed, but may have its delivery date rescheduled up
      to thirty (30) days later at no charge to Retailer provided Retailer may
      only reschedule such Order once. 

                   

                  Any
      exceptions to these requirements must be reviewed and approved in writing
      by ZMC.

                   

                  5.4          
      Title and Liability.

                   

                  Title
      to all Products shall pass to the Retailer from ZMC only upon payment in
      full to ZMC for the Products. Until ZMC has received payment in full, all
      right, title and a purchase money security interest in and to the Products
      and a purchase money security interest in all proceeds thereof shall
      remain with ZMC. The Retailer agrees to execute any and all conditional
      sales contracts, security agreements, documents and notices as may be
      required to preserve, protect and perfect the retention of title and
      security interests of ZMC in the Products and the proceeds thereof under
      all applicable laws

                   

                  5.5           
      Package and Shipment.

                   

                  All
      Products shall be packaged and packed in accordance with ZMC's normal
      practices. All
      shipping and delivery dates are estimates only. ZMC is not
      responsible for any late, lost or misdirected shipments and will not be
      liable for any damage, loss or expense incurred by Retailer for a failure
      to meet specified shipment dates or a failure to provide the correct
      quantity of Products ordered. ZMC will use commercially reasonable efforts
      to deliver orders on the date identified on the acknowledgement. If ZMC is
      unable to deliver on the date indicated, ZMC will notify Retailer and
      provide a new delivery date.

                   

                  5.6           
      Inspection.

                   

                  All
      Products purchased hereunder are subject to Retailer's inspection and
      acceptance provided that if Retailer has not rejected the Products in
      writing within two (2) business days of receipt, Retailer shall be deemed
      to have accepted such Products. Retailer may not reject partial shipments
      on the basis that they are not a full order. No Product shall be returned
      to ZMC without ZMC's written consent and a Return Material Authorization
      ("RMA") number, which number will be issued by ZMC in accordance with its
      RMA procedures. The RMA number must accompany any returned Products. ZMC
      reserves the right to refuse any Products returned without proper
      authorization or without proper identification of RMA number at ZMC's
      point of entry.

                   

                  6              
      PRICE, PAYMENT,
      TAXES AND DUTIES

                   

                  6.1          
      Wholesale Prices.

                   

                  The
      price for each Product shall be as set out in Schedule "B", as amended in
      writing by ZMC from time-to-time. ZMC shall in its sole discretion specify
      the effective date of the Prices if and when changed. All pricing and
      payments are listed in United States Dollars and will be calculated on an
      FOB ZMC production facilities basis. Payment for Products is due in
      accordance with Schedule
"B".

                

        

      

    

     

    Initials
/s/ DL /s/ DH

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
    

     

    
      
        
          	6.2          
      Suggested Retail Price 

                   

                  ZMC
      will issue from time to time "Retailer Price Bulletins" which will
      set forth ZMC's "Suggested Retail Price" for the Products. The Retailer is
      under no obligation to accept such Suggested Retail Price and may sell for
      less if it chooses. If it chooses to sell at prices less than those
      suggested, the Retailer will not suffer in any way in its business
      relations with ZMC or any other person over whom ZMC has control or
      influence. However, the Retailer shall not represent, either directly or
      indirectly, to any person that the suggested retail price for any Product
      is greater than the Suggested Retail Price.

                   

                  6.3          
      Sales and Service Records and Reports

                   

                  The
      Retailer shall keep complete, accurate and current records regarding the
      sale and servicing of Products, including without limitation records in
      respect of warranty work and recalls, and shall furnish to ZMC such
      reports and information based on those records as ZMC may reasonably
      request. The Retailer shall prepare, keep current and retain records, in
      accordance with such policies and procedures designated by ZMC, in support
      of all requests to ZMC for reimbursement or credit.

                   

                  6.4           Financial
      Records and Reports

                   

                  The
      Retailer shall furnish to ZMC quarterly, within 45 days of the end of each
      calendar quarter, complete and accurate financial and operating statements
      covering the preceding quarter and calendar year-to-date operations and
      showing the true and accurate condition of the Retailership and the
      Retailer.

                   

                  6.5          
      Inspection of Records

                   

                  The
      Retailer shall permit ZMC or its representatives, at any time during
      normal business hours and without prior notice, to examine, audit,
      reproduce and take copies of all reports, accounts and records pertaining
      to the sale, inventorying and servicing of Products including, but not
      limited to, records in support of claims for reimbursement or credit from
      ZMC. ZMC shall provide the Retailer with particulars of any documents
      which may be copied and taken in the course of any such examination. ZMC
      may, with the prior approval of the Retailer, which approval shall not be
      unreasonably withheld, interview the Retailer's employees with respect to
      the matters described in this section.

                   

                  6.6          
      Taxes and Duties.

                   

                  The
      price for Products excludes, and Retailer shall be liable for, all
      applicable Federal, State, Provincial, and local sales or other taxes,
      including without limitation, VAT, consumption and use taxes. Retailer
      shall be liable for any import and/or excise taxes, customs and duties
      incurred for licenses for clearance or otherwise required at point of
      entry and destination in accordance with FOB, Montreal, Canada. Retailer
      shall be responsible at its own expense to obtain any and all required
      permits, approvals, licenses and quotas as applicable for the import of
      any of the Products to its home country or any other country or
      region.

                   

                  7             
      SERVICE PROVISIONS

                   

                  7.1          
      Service Personnel.

                   

                  The
      Retailer shall establish and maintain a complete service and parts
      organization, including sufficient properly trained and competent service
      and parts personnel to adequately fulfill the service obligations to be
      performed by the Retailer under this

                	 	Agreement.
      

                   

                  7.2          
      Provisions of Service.

                   

                  The Retailer shall provide
      prompt, efficient and courteous service at reasonable cost, and warranty
      service at no cost, to an owner or lessee of an Automobile,
      regardless of origin of purchase or lease, in accordance with the provisions
      of applicable Retailer Bulletins and shall perform such service in
      such a manner as to secure and maintain the goodwill of the Retailer, ZMC
      and the Products and to achieve the highest possible
      level of customer satisfaction.

                   

                  7.3          
      Warranty and Related Work.

                   

                  The
      Retailer shall install any replacement of parts, make certifications or
      verifications and perform maintenance, service and other matters that may
      be required under the terms of the ZMC Warranty or in order to effect
      corrections or recalls. ZMC shall credit the Retailer's account for such
      warranty service, corrections or recalls which the Retailer performs in
      accordance with the Retailer Bulletins in effect at the time such service
      is performed. The Retailer shall provide all warranty service consistent
      with the ZMC Warranty applicable to each Product.

                   

                  8              
      WARRANTY AND INDEMNIFICATION

                   

                  8.1           
      Representations and Warranties.

                   

                  ZMC
      represents and warrants that the Products shall be free from defects in
      materials or workmanship under normal use and service as defined in the
      then-current ZENN Warranty document (refer to Schedule D). Third party
      components used within the Products may be warranted by the third party as
      specified in the documentation accompanying the third party
      products.

                   

                  8.2           
      ZMC Warranty.

                   

                  The
      Retailer shall deliver to each purchaser of a new Product the ZMC Warranty
      therefore endorsed with the particulars of sale and shall notify ZMC of
      the sale of each new Product, or used Product if still under warranty, in
      such manner as prescribed by ZMC in accordance with policies and
      procedures established in the Retailer Bulletins. If the Retailer installs
      on a Product any equipment, accessory or part other than a new Part or
      Accessory, or sells any Automobile which has been modified, or sells any
      non­ZMC service contract in conjunction with the sale of a Product,
      the Retailer shall disclose this fact to the end user and shall advise the
      end user that the modification, equipment, accessory or part is not
      included in the ZMC Warranty or any other warranty furnished by ZMC or, in
      the case of a service contract, the coverage is not provided by ZMC. The
      Retailer shall include such disclosure on all copies of the purchase order
      and on the end user's bill.

                   

                  8.3           
      Disclaimer.

                   

                  EXCEPT
      AS EXPRESSLY STATED ABOVE IN SECTION 8.2, ALL WARRANTIES ARE DISCLAIMED,
      INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY,
      ACCURACY, CONDITION, OWNERSHIP, FITNESS FOR A PARTICULAR PURPOSE, AND/OR
      NON- INFRINGEMENT OF THIRD PARTY INTELLECTUAL PROPERTY
RIGHTS.

                   

                  8.4          
      Damages Limitation.

                   

                  INDEPENDENT
      OF ANY OTHER LIMITATION CONTAINED HEREIN, IN NO EVENT SHALL ZMC BE LIABLE
      FOR SPECIAL, INCIDENTAL, INDIRECT, OR CONSEQUENTIAL DAMAGES OF ANY KIND,
      OR LOSS OF PROFIT OR REVENUE RELATED TO THE SUBJECT MATTER OF THIS
      AGREEMENT, EVEN IF

                

        

      

    

     

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        4

        
          

        

      

      
        
        

      

    

     

    
    

     

    
      
        
          	
                  INFORMED
      OF THE POSSIBILITY THEREOF IN ADVANCE. ZMC WILL ALSO NOT BE LIABLE FOR ANY
      DAMAGES AS A RESULT OF PERSONAL INJURY OR PROPERTY DAMAGE EXCEPT AS MAY BE
      PROVIDED FOR HEREIN. THESE LIMITATIONS APPLY TO ALL CAUSES OF ACTION IN
      THE AGGREGATE, INCLUDING WITHOUT LIMITATION BREACH OF CONTRACT, BREACH OF
      WARRANTY, NEGLIGENCE, STRICT LIABILITY, FRAUD, MISREPRESENTATION AND OTHER
      TORTS. RETAILER WILL BE SOLELY RESPONSIBLE FOR ALL REPRESENTA-TIONS OR
      OMISSIONS RETAILER MAKES TO ITS CUSTOMERS OR END USERS. IN NO EVENT WILL
      ZMC'S OR ITS AFFILIATES' OR SUPPLIERS' AGGREGATE LIABILITY UNDER THIS
      AGREEMENT, REGARDLESS OF THE FORM OF CLAIM OR ACTION, EXCEED A SUM EQUAL
      TO THE AMOUNTS PAID BY RETAILER TO ZMC IN THE ONE (1) YEAR PERIOD
      IMMEDIATELY PRECEDING THE DATE ON WHICH A WRITTEN DEMAND FOR DAMAGES IS
      MADE.

                   

                  8.5          
      Indemnity to ZMC.

                   

                  Retailer
      will indemnify, defend and hold ZMC, including ZMC's partners, officers,
      directors, agents, employees, subsidiaries, affiliates, parents,
      successors and assigns, harmless from any claim, demand, cause of action,
      debt or liability (including reasonable attorneys fees, expenses and court
      costs) arising from: (a) any third party claim related to or that arises
      in connection with Retailer's use and/or sale of the Products, including
      without limitation, any claims relating to the infringement of third party
      intellectual property rights, except to the extent any such claim is based
      solely upon the Products in their unmodified form as provided by ZMC; (b)
      Retailer's modifications of and/or additions to any ZMC Products; (c)
      Retailer's breach of this Agreement, (d) omissions, misrepresentations, or
      negligence by Retailer or its representatives, and (e) sale of Products by
      Retailer to a third party to the extent such claim is based on: (i)
      Retailer's modifications of and/or additions to any Products, misuse or
      abuse of the Products, negligence or breach of any provision in this
      Agreement; (ii) Retailer's failure to abide by all applicable laws, rules,
      regulations and orders that affect the Products; (iii) Retailer's
      omission, misrepresentation, or negligence, or (iv) Retailer's or its
      end-users' actions causing harm to any person or property.

                   

                  9             
      TERM AND TERMINATION

                   

                  9.1           Term.

                   

                  The
      initial term of this Agreement shall commence on the Effective Date and
      shall continue for a period of three (3) years (the "Term").
      Thereafter, unless otherwise terminated by either party by
      providing at least one hundred and eighty (180) days prior written notice,
      the Term shall automatically renew for additional one (1) year
      periods.

                   

                  9.2           Termination.

                   

                  This
      Agreement will terminate:

                   

                  
                    (a)         On
      the thirtieth (30) day after either party gives the other written notice
      of a material breach by the other of any term or condition of this
      Agreement, unless the breach is
      cured before that day.

                  

                   

                  
                    (b)        
      When
      either party, in its discretion, gives the other written notice of
      termination after the other has been the subject of any voluntary or
      involuntary proceeding relating to bankruptcy, insolvency,
      liquidation,
      receivership,
      composition
      of or assignment for the benefit of creditors.

                     

                    9.3          
      Effect
      of Termination. 

                  

                   

                  Upon termination of
      this Agreement:

                	 	
                  (a)           
      All rights granted herein shall immediately terminate and no interest
      whatsoever in any of such rights shall remain with Retailer except as may
      be required to fulfill warranty or support obligations to Retailer's
      customers; 

                   

                  (c)         
      All
      Payment, delivery, and confidentiality obligations arising prior to
      termination will remain in force. In the event of termination of this
      Agreement is due to Retailer's material breach the due date for all
      invoices for Products shall automatically be accelerated so that they
      shall immediately become due and payable on the effective date of
      termination, even if longer terms had been provided previously;
      and

                   

                  
                    (d)           
      Neither
      party will be liable for damages of any kind as a result of exercising its
      right to terminate this Agreement.

                  

                   

                  9.4          
      Termination Other Than For Retailer's Material Breach.

                   

                  Notwithstanding
      anything to the contrary contained in Section 9.3, where termination of
      this Agreement occurs other than as a result of Retailer's material
      breach, Retailer shall be permitted, after termination of this Agreement
      to continue distributing the Products from its inventory
only.

                   

                  10            
      PROPRIETARY RIGHTS

                   

                  10.1        
      Trademark License.

                   

                  ZMC
      hereby grants Retailer a non-exclusive, revocable (upon termination
      hereof), non-transferable, non-assignable, limited license to use the
      "ZMC" name and ZMC's product names solely for the purpose of accurately
      identifying the ZMC-branded Products it markets and sells that are
      purchased pursuant to the terms of this Agreement. All goodwill generated
      as a result of Retailer's use of the ZMC name and ZMC product names is
      solely for the benefit of ZMC. Retailer agrees to change or correct, at
      its own expense, any material or activity that ZMC decides is inaccurate,
      objectionable or misleading or a misuse of ZMC's name, trademarks, service
      marks, or ZMC's logos or copyrighted works. Failure to forthwith correct
      any changes required by ZMC may result in a termination of the license
      contained in this section, in ZMC's sole discretion. All ZMC marks shall
      be used in accordance 'with ZMC's communications guidelines in effect from
      time to time. Retailer is prohibited from: (a) implying that Retailer and
      ZMC are partners or creating the impression that ZMC is affiliated with
      Retailer; (b) registering or using any domain name or business name
      containing or confusingly similar to any name or mark of ZMC's; and (c)
      not clearly and prominently identifying itself in all offers and
      advertising, marketing and promotional materials relating to ZMC Products
      sold under this Agreement.

                   

                  10.2        
      ZMC Proprietary Rights.

                   

                  Retailer
      acknowledges and agrees that ZMC (and/or its licensors) will retain all
      Proprietary Rights (as defined below) in the Products, Trademarks and any
      documentation related to any of the foregoing (collectively the "ZMC
      Property"). "Proprietary Rights" means all right, title and interest to
      the intellectual property contained in the ZMC Property including but not
      limited to any and all patent rights, patent applications, rights to apply
      for patents, copyrights, copyright registrations, trade secrets,
      trademarks, service marks, trademark and service mark registrations and
      all related goodwill. Retailer acknowledges and agrees that the purchase
      of any Products does not grant or convey Retailer any right or license in
      any of the ZMC Property other than as expressly provided for in this
      Agreement.

                

        

      

    

     

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                      10.3        
      Proprietary Rights Notices.

                       

                      Retailer
      shall not remove, alter, modify or obscure any ZMC trademark, logo or
      similar mark or any ZMC Proprietary Rights notices (including, without
      limitation, patent registration numbers and trademark notices) on or in
      the ZMC Property.

                       

                      10.4        
      No Challenge to ZMC Proprietary Rights.

                       

                      During
      the term of this Agreement and after its expiration or termination,
      Retailer shall not, directly or indirectly: (i) dispute or contest, for
      any reason whatsoever, ZMC's ownership of any Proprietary Rights embodied
      in, related to or derivable from the ZMC Property, or the validity or
      enforceability of any such Proprietary Rights; (ii) oppose or interfere
      with any application for registration of any Proprietary Rights embodied
      in, related to or derivable from the ZMC Property; (iii) interfere with
      the manufacture, use or sale of the Products or any future version
      thereof, by ZMC or any of its licensees, successors or assigns; or (iv)
      counsel, procure or assist anyone else to do any of the
      foregoing.

                       

                      11           
      MISCELLANEOUS

                       

                      11.1        
      Relationship of Parties.

                       

                      Other
      than as provided herein, this Agreement does not create any exclusive
      arrangement between the parties, and either party hereto may meet,
      exchange information, enter into agreements and conduct business
      relationships of any kind with third parties, to the exclusion of the
      other party. Subject to the terms and conditions of this Agreement
      (including without limitation, the confidentiality obligations described
      in Section 4.1) and except as otherwise agreed to in writing by the
      parties, discussion and/or communications between the parties will not
      serve to impair the right of either party to develop, make, use, procure,
      and/or market products or services now or in the future that may be
      competitive with those offered by the other, nor to develop and provide
      products to competitors of the other party.

                       

                      11.2         Force
      Majeure.

                       

                      If
      the performance of this Agreement or any obligation under it (except
      payment of monies due) is prevented, restricted or interfered with by
      reason of acts of God, acts of government, or any other cause not within
      the control of either party, the party so affected shall be excused from
      such performance, but only for so long as and to the extent that such a
      force prevents, restricts or interferes with that party's performance. The
      party affected by the other party's delay or inability to perform may
      elect to suspend this Agreement for the duration of the force majeure
      condition and (i) at its option buy, sell, obtain or furnish elsewhere
      material to be bought, sold, obtained or furnished under this Agreement
      and (ii) once the force majeure condition ceases, resume performance under
      this Agreement. When the delay or nonperformance continues for a period of
      a least thirty (30) days, either party may terminate this Agreement or any
      part of it relating to Products not already shipped.

                       

                      11.3        
      Assignment.

                       

                      Retailer
      may not assign its rights or obligations under this Agreement, without the
      prior written consent of ZMC, which consent shall not be unreasonably
      withheld.

                       

                      11.4        
      Notices.

                       

                      All
      notices required to be given under this Agreement and any communication
      sent with respect to this Agreement shall be given in
      writing and shall be deemed received by the party to whom
      the

                    	 	
                      notice
      or correspondence is sent:

                       

                      (a)          
      one
      Business day after the notice or communication is sent via reliable
      overnight commercial courier (charges prepaid), or

                       

                      (b)            on
      the date the notice or communication is personally delivered to the other
      party, at the addresses first written above.
      
                        
                        

                         

                        11.5         
      Press Release.

                         

                        Retailer
      shall not issue a press release relating to this Agreement or to the
      subsequent addition of any Products hereto without ZMC's written
      consent.

                         

                        11.6         
      Severability.

                         

                        Whenever
      possible, each provision of this Agreement will be interpreted in such
      manner as to be effective and valid under applicable law, but if any
      provision of this Agreement is held to be prohibited by or invalid under
      applicable law, the parties will negotiate in good faith to restate such
      provision to reflect the original intentions of the parties as nearly as
      possible in accordance with applicable law and the remaining provisions of
      this Agreement shall be enforced as if this Agreement was entered into
      with the restated provision.

                         

                        11.7          Applicable
      Law.

                         

                        This
      Agreement shall be governed by and enforced in accordance with the laws of
      the Canadian Province of Ontario without reference to its conflict of laws
      principles. The parties waive all rights they may have to a trial by jury.
      The rights and obligations under this Agreement shall not be governed by
      the United Nations Convention on Contracts for the International Sale of
      Goods, the application of which is expressly excluded.

                         

                        11.8         
      Dispute Resolution.

                         

                        All
      disputes arising out of or in connection with this Agreement or the breach
      thereof, including any questions regarding its existence, validity or
      termination shall be resolved by arbitration before a single arbitrator
      with knowledge and experience in the field of electric and low speed
      vehicle technology pursuant to the International Arbitration Rules of the
      American Arbitration Association and shall be held in Toronto, Canada.
      Notwithstanding the foregoing, each party shall be entitled to seek
      injunctive relief from any court of competent jurisdiction with respect to
      protection of its intellectual property rights. The governing law shall be
      the law of Ontario, Canada.

                         

                        11.9          Entire
      Agreement.

                         

                        This
      Agreement and all Attachments hereto constitute the final written
      expression of all terms of the Agreement relating to the transactions
      described herein. This Agreement supersedes all previous communications,
      representations, agreements, promises or statements, either oral or
      written, with respect to such transactions. No addition to or modification
      of any provision of this Agreement will be binding unless made in writing
      and signed by the parties hereto.

                         

                        11.10        
      Survival.

                         

                        Any
      provision of this Agreement which by its use or context is intended to
      survive the termination of this Agreement shall so survive, including,
      without limitation, Sections 4, 0, 9.3, and 11 shall bind the parties and
      their legal representatives, successors, heirs and
      assigns.

                      

                    

            

          

        

      

       

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                11.11     
      Export Restrictions and Statement of Assurance.

                 

                Products
      obtained under this Agreement are subject to Canadian, U.S. or other
      export control laws, including the U.S. Export Administration Regulations,
      as well as end-user, end-use and destination restrictions issued by the
      U.S. and other governments. Retailer assures that it will comply with all
      applicable export control laws at all times, including, when it exports or
      re-exports controlled products or technical data obtained from ZMC or any
      products produced directly from the controlled products or technical
      data.

                 

                11.12      Language.

                 

                The
      original of this Agreement has been written in English and Retailer waives
      any right it may have under the laws of its territory to have this
      Agreement written in any other language.

              	 	 

      

    

     

    

    

    ZENN
MOTOR COMPANY

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	By:	
                                              /s/  
      Dennis Hancock

                                            	
                                               

                                            	 	 
	 	
                                              (I
      have authority to bind the corporation)

                                            	 	 	 
	 	
                                               

                                            	 	 	 
	Name:	
                                              Dennis
      Hancock

                                            	 	 	 
	 	
                                              (Print
      or Type)

                                            	 	 	 
	 	 	 	 	 
	Title:	
                                              Vice
      President, Sales & Marketing

                                            	 	 	 
	 	      
                                              (Print
      or Type)

                                            	 	 	 
	 	 	 	 	 
	Date:	
                                              September
      10th, 2008

                                            	 	 	 
	 	
                                              (Print
      or Type)

                                            	 	 	 

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

     

     

    
      	By:	
              /s/  
      Dale Long

            	
               

            	 	 
	 	
              (I
      have authority to bind the corporation)

            	 	 	 
	 	
               

            	 	 	 
	Name:	
              Dale
      Long

            	 	 	 
	 	
              (Print
      or Type)

            	 	 	 
	 	 	 	 	 
	Title:	
              CEO/PRES

            	 	 	 
	 	      
              (Print
      or Type)

            	 	 	 
	 	 	 	 	 
	Date:	
              9/10/08

            	 	 	 
	 	
              (Print
      or Type)

            	 	 	 

    

     

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/s/ DL /s/ DH

     

    7

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