Document:

COOPERATION
        AGREEMENT

      

      

      Party
        A:
        Jinan Hi-Tech Industries Development Zone Commission 

      

      Party
        B:
        Pericom Semiconductor Corporation (USA)

       

      Article
        1-Project Description

       

      
        	1.	 	
                Business
                  Scope

              

      

      

      Party
        B
        is a U.S. company having its principal place of business in Silicon Valley,
        California, U.S.A. and listed on the NASDAQ Stock Exchange. Party B manufactures
        IC and FCP, including quartz crystal and oscillator componentry (hereinafter
        referred to as "Products"). Party B plans to, through a wholly-owned subsidiary
        incorporated in Hong Kong, establish a
        subsidiary (hereinafter
        referred to as "Party B Subsidiary")
        and factory within the administrative jurisdiction of Party A, engaging in
        the
        manufacturing of the Products. The business scope of Party
        B
        Subsidiary is determined to include design, research, development, purchasing,
        manufacture, testing, packaging and sales of the Products, and also include
        the
        import and export, and local distribution of the Products and related products.
        The business scope and scale shall comply with applicable regulations of
        PRC and
        approved by the governing authorities.

      

      
        	2.	
              	
                Investment
                  Amount

              

      

      

      Party
        B's total investment in the Party B Subsidiary will be no less than Thirty-Five
        Million U.S. Dollars (USD35,000,000) (inclusive of purchasing the Land,
        constructing factory, purchasing equipment, intellectual property necessary
        for
        research and development, manufacturing and sales). The registered capital
        Party
        B
        Subsidiary
        will be no less than Thirty Million U.S. Dollars (USD30,000,000). The investment
        schedule is stated in Schedule 1 and will be properly adjusted according
        to
        market conditions. 

      

      
        	3.	 	
                Incorporation
                  and Registration of Party B
                  Subsidiary

              

      

      

      Party
        A shall perform, for Party B's account and free of charge, the incorporation
        and
        registrations of Party B Subsidiary as are necessary for the operation of
        Party
        B Subsidiary. Party B shall provide to Party A any and all necessary information
        and documents for the incorporation and registrations and shall bear the
        fee
        incurred in the incorporation and registrations. 

      

      
        	4.	 	
                Land
                  and Factory

              

      

       

      4.1
        Land-use right 

      

      Party
        B Subsidiary will be located on north of Feng-man Road, west of Kai-Ta Road,
        and
        south of Jinan
        Dalu Mechanism & Electronics Project, with a net area of
        75 acres
        and
        levied road (actual area shall be subject to measurement, hereinafter referred
        to as "Land").
        Party B Subsidiary shall obtain the land-use right certificate pursuant to
        related procedures. The term of the land-use right of the Land will be 50
        years
        after such right is granted to Party B Subsidiary. Party A shall be responsible
        to have the Land well equipped and prepared based on the technical needs
        of
        Party B Subsidiary and Party A shall be responsible for completion of “seven
        connection and one flat” (including road connection, water supply connection,
        water drainage connection, steam supply connection, gas supply connection,
        electricity supply connection, communication connection and flat land; the
        detailed information of the Land, the plot of the Land and related requirements
        shall be listed in Schedule 2). Party A shall, for the account of Party B
        and
        free of charge, act to acquire the land-use right certificate. Party B shall
        provide to Party A any and all necessary information and documents for the
        acquirement of the land-use right certificate and shall bear the fee incurred
        therefrom.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      
        
          	4.2	 	
                  Construction
                    of Factory

                

        

      

       

      
        Party
          A shall perform the construction planning procedure on behalf of Party
          B free of
          charge (including acquiring land plan approval, construction plan approval
          and
          construction commencement approval). Party B shall be responsible to engage
          the
          qualified designer to prepare the construction plan of the factory, building
          scheme plan, construction drawing design, to ensure that the design meets
          the
          fire control, environmental protection, construction drawing review requirements
          (if during the reviewing process by the governing authority and certain
          amendments are required, Party B shall be responsible for performing the
          amendment) and shall supply to Party A any and all required documents necessary
          for the plan and construction procedure. Party B shall bear the fee and
          tax
          incurred therefrom. Party B shall form a construction task force in charge
          of
          the bidding, construction, and inspection of the factory. Party A shall
          provide
          assistances on the related formalities and communication with the governing
          authorities so as to jointly speed up the construction progress. In addition,
          Party A covenants to assist Party B in any and all related application
          procedure
          throughout the construction period until the completion of the construction
          of
          the factory. If Party B needs any assistance from Party A during the
          construction, Party A shall exercise its best effort in providing the
          assistance. 

      

        

        4.2.2
        After the completion and inspection of the factory, Party A shall be responsible
        to assist Party B Subsidiary to complete the procedure of the title registration
        of the factory.

       

      Article
        2 - Tax Incentive and Other Financial
        Support

       

    

    
      	1.  	
              In
                order
                to support the construction and development of Party B's business,
                Party A
                agrees to secure substantial tax incentives for Party B's investment
                project by any and all possible means. Said substantial tax incentives
                include, but are not limited to: 

            

      

      	 	
              1.1
                Party A covenants and guarantees that Party B and Party B Subsidiary
                will
                enjoy tax incentives and preferential policies to the maximum extent
                as
                permitted under the national and provincial laws and
                regulations.

            

      	 	
               

            

      	 	
              1.2
                Party B shall be responsible to procure that Party B Subsidiary reaches
                the planned operational objective. After the various enterprise reports
                of
                Party B Subsidiary meet the official requirements for certification,
                Party
                A covenants and guarantees that within 6 months after Party B Subsidiary
                has started its operation, it shall coordinate with the Shandong
                Information Industry Department, Shandong Science and Technology
                Department and other governing authorities to acquire the certification
                of
                “hi-tech enterprise,” “software enterprise,” and “software product,”
                for
                Party B Subsidiary to legally and substantially enjoy
                the tax incentives, e.g. "Two-year
                Exemption and Three-year Half Reduction" and special income tax rate
                for
                hi-tech companies. Party A shall further coordinate with other governing
                authorities to have Party B Subsidiary enjoy any other possible incentives
                and preferential treatments.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
    

    
      	 	
              1.3
                Party A covenants
                and guarantees that the local administrative fees to be levied by
                Jinan
                City Government shall be entirely exempted during the operation of
                Party B
                Subsidiary (or be subsidized by Party A via financial support after
                Party
                B pays to the government and such subsidy shall not be included in
                the
                support amount under schedule 1).

            

    

    
      	 	 

    

    
      	 	
              1.4
                If and when Party B's investment project falls within the national
                encouraged category of investment, Party A covenants and guarantees
                that
                any and all construction material, manufacturing equipment and accessories
                to be imported shall be tax/duty free except for the 20 statutory
                non-tax
                exempt items and the value of imported equipment in excess of the
                total
                investment amount.

            

    

    
      	 	 

    

    
      	 	
              For
                those construction materials, manufacturing equipment and accessories
                that
                will be purchased domestically, Party A covenants and guarantees
                that, to
                the extent allowed under the applicable laws and regulations, it
                will
                coordinate with customs and tax authorities to waive or reduce the
                tax and
                administrative fees to the greatest
                extent.

            

    

     

    
      	2.  	
              Party
                A covenants and guarantees that Party B
                Subsidiary
                may postpone its payment of the city
                construction
                fee
                (including fee for water drainage, RMB112 per square meter) indefinitely.
                In case it is required to pay such fee, Party A agrees to provide
                the
                financial support in the same amount to Party B
                Subsidiary.

            

    

    

    
      	3.  	
              According
                to the actual paid-in capital made by Party B, Party A covenants
                and guarantees
                to grant financial support pursuant to the investment stages performed
                by
                Party B.
                (Schedule 2-1)

            

    

    

    
      	4.  	
              If
                the income tax to be paid by Party
                B
                Subsidiary, which will become the actual financial income of Party
                A,
                exceeds [*] Party
                A shall provide [*]
                of such excessive amount to Party B as financial support. Further,
                if any
                financial support policies provided under the "Forty
                Articles" (Schedule 4) stipulated by Party A provides more advantageous
                financial support, the "Forty Articles" shall be performed instead
                of the
                foregoing support amount. Party A shall faithfully inform Party B
                of the
                percentage of the income to be shared respectively by the central,
                provincial and city governments regarding the financial income of
                Party
                A.

            

    

    

    
      	5.  	
              Party
                A covenants and guarantees that Party B
                Subsidiary may apply for the approval to apply the Processing Trade
                Manual
                and thus may conduct its bonded ledger
                management electronically and enjoy the preferential policies granted
                to
                Processing
                Trade Enterprises.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	6.  	
              Party
                A agrees to assist Party B to arrange the departure and entry procedure
                for the employees to and from foreign countries and assist Party
                B to
                obtain subsidiary for offshore
                training.

            

    

    

    
      	7.  	
              Subject
                to the Jinan City’s policy, Party A agrees to assist Party B's employees
                from other provinces to register their domicile
                locally.

            

    

    

    
      	8.  	
              While
                Party
                B Subsidiary reaches the planned operational objective and the various
                enterprise reports of Party B Subsidiary meet the official requirements,
                Party A could not coordinate with the Shandong
                Information Industry Department, Shandong Science and Technology
                Department and other governing authorities to have Party B Subsidiary
                acquire the certification of “hi-tech enterprise,” “software enterprise,”
                and “software product,” for
                Party B Subsidiary to legally and substantially enjoy
                the tax incentives, e.g. "Two-year
                Exemption and Three-year Half Reduction," special income tax rate
                for
                hi-tech companies, or Party B Subsidiary would fail to apply the
                preferential policies granted to the Processing Trade Manual, Party
                A
                shall increase the financial support amount in order to compensate
                the
                loss of Party B, and Party A shall provide a letter of consent to
                such
                effect (Schedule 3); provided, however, that if Party B Subsidiary
                is
                confirmed not be able to enjoy said preferential policies or incentives
                under this Agreement, Party B may notify Party A to terminate this
                Agreement, without being subject to Article 9, Paragraph
                6.

            

    

     

    Article
      3 - Party A's General Obligations

     

    
      	1.  	
              Party
                A shall provide quality service to Party B Subsidiary and will urge
                its
                subordinate departments to assure the quality and efficiency of their
                services.

            

    

    

    
      	2.  	
              Party
                A shall assist
                Party B
                Subsidiary and arrange on behalf of Party B the coordination and
                communication with concerned departments so that Party
                B
                Subsidiary may operate normally and efficiently. Party A also guarantees
                to provide support to Party B Subsidiary, including, without limitation,
                review and approval, customs
                formalities,
                tax, construction, environment certification, personnel recruitment,
                foreign exchange, Customs and any other assistances necessary for
                the
                operational need.

            

    

     

    Article
      4
      - Party A's Specific Obligations

     

    
      	1.  	
              On
                the basis that Party B and Party
                B
                Subsidiary covenant that the imported material will be used for
                manufacturing of Products to be exported (in case the imported material
                are used to sell domestically, Party B and Party
                B
                Subsidiary shall pay related taxes), apply for approval pursuant
                to
                related laws and regulations, perform the customs procedure, and
                pay
                related taxes and fees, Party A shall coordinate with the Customs
                to
                assure that the following matters will be
                feasible:

            

    

    

    
      	(1)  	
              After
                obtaining approval from the Shandong Development and Reform Commission,
                the policy for Processing Trading enterprises will be applicable
                to Party
                B.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	(2)  	
              Subject
                to approval by Customs concerning the quantity of imported materials,
                Party B shall not be required to import or export the materials via
                bonded
                warehouse. Further, Party B shall not be required to check with Customs
                for each lot of imported material. The valid term for usage of the
                materials is one year. Customs will conduct an audit according to
                the
                manufacturing situation.

            

    

    

    
      	(3)  	
              Within
                the scope approved by Customs, after the materials' arrival at the
                airport
                and clear the customs procedure, the materials may be shipped directly
                to
                Party B's factory.

            

    

    

    
      	2.  	
              Party
                A shall coordinate with the concerned authorities to provide a detailed
                breakdown of all fees and taxes required to be paid for Party B's
                business
                and operation. Such breakdown shall provide the departments that
                stipulate
                the items of fees and taxes, payment
                ratio.

            

    

    

    
      	3.  	
              Party
                A shall provide Party B or Party B Subsidiary with any and all taxable
                items and processing flow in
                writing.

            

    

     

    Article
      5
      - Party B's Obligations

     

    
      	1.  	
              Party
                B covenants to abide by all laws, regulations and policies of the
                People's
                Republic of China.

            

    

    

    
      	2.  	
              Party
                B covenants to prepare related contracts, business performance records
                and
                financial reports, and provide any required documents for setting
                up the
                factory.

            

    

    

    
      	3.  	
              Party
                B covenants to provide Party A with a detailed list of the equipment
                to be
                imported and the working condition
                thereof.

            

    

    

    
      	4.  	
              Party
                B shall ensure that the investment will be made and the operational
                objective will be achieved according to the construction and development
                plan.

            

    

     

    Article
      6
      - Guarantee for Investment Peformance and Incentives

    The
      parties understand that if either party fails to perform its obligations under
      this Agreement as scheduled and thus delay the implementation of this investment
      project or the commercial operation, material and adverse impact on Party B's
      investment would occur. Party B understands that, after the parties having
      performed their obligations under this Agreement, if Party B fails to make
      its
      investment according to this Agreement, an unfavorable result will also occur
      to
      the parties. Each party guarantees that it will perform its obligations under
      this Agreement respectively, and that if one party fails to perform its
      covenants or guarantees and such non-performance cannot be settled after
      amicable negotiation, the other party may take necessary actions, including
      claiming for damages, so as to remove the unfavorable impact so
      incurred.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Article
      7- Confidentiality

     

    Unless
      otherwise provided by laws, US Securities and Exchange Commission and NASDAQ
      rules, all the terms and conditions set forth in this Agreement (including
      the
      existence of this Agreement) shall be considered confidential information and
      shall not be disclosed to any third party. In the event that the laws, US
      Securities and Exchange Commission or NASDAQ rules require either party to
      disclose the terms and conditions of this Agreement, the existence of this
      Agreement or any information relevant to this Agreement, or in case this
      Agreement should be submitted to any administrative body in any jurisdiction,
      such party shall:

     

    
      	1.  	
              within
                a reasonable period of time before making the disclosure or submission,
                consult with the other Party;

            

      	 	 

      	2. 	
              within
                a reasonable scope, refuse to disclose, request to minimize the disclosure
                scope, obtain a protective order for the disclosed information and,
                according to the other party's reasonable request, take all the reasonable
                steps and actions to secure the confidentiality of such disclosure
                or
                submissions.

            

      	 	 

      	 3. 	
              advise
                the other party of the information, which is disclosed according
                to the
                law.

            

    

     

    This
      Article shall survive the termination of this Agreement. 

     

    Article
      8 - Further Incentive Policy and Support

     

    If,
      after
      the execution of this Agreement, the People's Republic of China, Shandong
      Provincial Government, Jinan City Government or Jinan Hi-Tech Industries
      Development Zone grants more preferential incentives to other foreign invested
      businesses, Party A agrees that those policies shall be applied to Party B
      and
      Party B
      Subsidiary
      as soon
      as possible. Each party agrees to take any and all actions to achieve the
      purpose of this Agreement for providing Party B and Party B
      Subsidiary with
      the
      incentives. 

     

    Article
      9
      - Miscellaneous

     

    
      	1.  	
              The
                schedules and graphs attached to this Agreement shall be deemed as
                the
                integral part of this Agreement having the same legal effect as this
                Agreement. 

            

    

    

    
      	2.  	
              This
                Agreement shall be executed by the representatives of the Parties
                and will
                become effective on the date of execution ("Effective Date"). Upon
                and
                after the Effective Date, any prior expression made for the contemplated
                investment hereunder and executed documents shall become invalid
                or
                terminated; and shall be superseded by this Agreement.
                

            

    

    

    
      	3.  	
              Each
                party shall bear and pay all its expenses incurred from the negotiation,
                execution of this Agreement and performing administrative procedures
                for
                acquiring official approvals.

            

    

    

    
      	4.  	
              Subject
                to Party A's consent, Party B may assign the rights and obligations
                under
                this Agreement to an appropriate third party and such third party
                will
                thereby assume the rights and obligations of Party B under this Agreement;
                provide, however, that no consent shall be required, if such third
                party
                is Party's B's subsidiary or an enterprise controlled by Party B.
                

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	5.  	
              Upon
                the incorporation of Party
                B's
                Honk Kong subsidiary and Party B Subsidiary, they
                shall be deemed as parties to this Agreement and shall exercise Party
                B's
                right and perform Party B's obligation as provided herein and Party
                A
                shall perform toward them its obligations under this
                Agreement.

            

    

    

    
      	6.  	
              During
                the term of this Agreement, if either party fails to perform its
                obligation under this Agreement, the non-breaching party may request
                the
                breaching party to cure such breach within 30 days after receipt
                of the
                written notice from the breaching party. If the breaching party fails
                to
                cure the breach within 30 days, the non-breaching party may terminate
                this
                Agreement by a written notice. The breaching party shall be liable
                for the
                actual damages incurred by the non-breaching party therefrom (including,
                without limitation, the actual increased costs and expenses). In
                case any
                item required to be confirmed or agreed hereunder, but failed to
                be
                confirmed or agreed and still fails to be confirmed or agreed within
                30
                days after notice from one party to the other, the notifying party
                may
                terminate this Agreement by written notice.

            

    

    

    
      	7.  	
              If
                this Agreement is terminated according to Article 2, Paragraph 8,
                or the
                preceding Paragraph 6 by Party B and if the non-breaching party is
                Party B
                and the termination is due to Party A's non-performance of the obligations
                under this Agreement, Party B may withdraw its investment after the
                termination of this Agreement. Party A shall provide any and all
                necessary
                assistances to Party B in completing the procedures related to
                dissolution, liquidation, deregistration and transfer of residual
                assets
                from the People's Republic of China.

            

    

    

    
      	8.  	
              The
                party who encounters earthquake, landslide, typhoon, flood, fire,
                tsunami,
                war, riot, strike or any other force
                majeure
                that is unforeseeable and its occurrence and result (for the avoidance
                of
                doubt, force
                majeure
                shall not include the approval of Jinan City Government for the project
                plan or changes of laws or regulations) are not preventable and which
                event renders the performance impossible or delays the performance
                of this
                Agreement, shall inform the other Party as soon as the occurrence
                of such
                event and provide the detailed information, reasons of non-performance
                or
                delay and valid proof within 15 days after the occurrence. The
                non-performance or delay of either of the parties hereto in performing
                any
                obligation under this Agreement solely by reason of force
                majeure shall
                not be deemed to be a breach of this Agreement. The parties shall
                discuss
                and negotiate whether to rescind or terminate this Agreement, partially
                release the obligations under this Agreement or postpone the performance
                of this Agreement based on the degree so affected by the force
                majeure. The
                parties further agree that if the factory is damaged or destroyed
                due to
                the force
                majeure,
                Party B may rescind or terminate this Agreement in writing without
                liability. If Party B Subsidiary has been incorporated, Party A shall
                provide any and all necessary assistances to Party B in completing
                the
                procedures related to dissolution, liquidation, deregistration and
                transfer of residual assets from the People's Republic of China.
                

            

    

    

    
      	9.  	
              The
                parties shall designate high-ranking officers to form a working team
                acting as coordination counterparts; and the team will be responsible
                for
                the coordination and communication between the parties for the preparation
                of the project, construction and operation and cooperate to overcome
                any
                barriers so encountered.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	10.  	
              The
                term “nation” referred to herein shall refer to People’s Republic of
                China, unless otherwise indicated. The interpretation and performance
                of
                this Agreement shall be made in accordance with the laws of People's
                Republic of China. If any dispute arises from the performance of
                this
                Agreement or concerning the validity of a particular provision, the
                parties shall discuss and negotiate to settle the dispute. If one
                party
                refuses to negotiate or the parties fail to reach settlement, either
                party
                may submit the dispute to arbitration by (i) the China International
                Economic and Trade Arbitration Commission, Shanghai Sub-Commission
                in
                Shanghai pursuant to the PRC Arbitration Law and the Rules of such
                Commission, if the requesting party is Party A; or by (ii) the Hong
                Kong
                International Arbitration Centre pursuant to the Hong Kong arbitration
                law
                and the Rules of such Centre, if the requesting party is Party B.
                

            

    

    

    
      	11.  	
              Any
                right and obligation under this Agreement is severable. In the event
                that
                any provision of this Agreement violates the mandatory laws of PRC,
                such
                violating provision(s) shall be deemed invalid and have no legal
                effect
                automatically. 

            

    

    

    
      	12.  	
              Any
                notice in relation to the performance of this Agreement or related
                matters
                shall be sent by the notifying party via email and registered mail
                to the
                following address of the other party:

            

    

    

    Party
      A:

    Attention:

    Email:

    Address:

    

    Party
      B:

    Attention:

    Email:

    Address:

    

    Either
      party may change its address by written notice in accordance with the preceding
      provision.

    

    
      	13.  	
              After
                this
                Agreement becomes effective, the change of administrative organization
                or
                administrative
                jurisdiction of Party
                A shall not affect the validity and enforceability of this Agreement;
                and
                this Agreement shall be assumed by the authorities, which assumes
                the
                overall administrative functions of Party A. This Agreement is entered
                into and confirmed under the authorization letter issued by the Mayor
                of
                Jinan City (Schedule 5).

            

    

    

    
      	14.  	
              The
                parties will execute two original copies of this Agreement and each
                party
                will keep one copy as evidence of execution. This Agreement may be
                translated into other languages while the Chinese version shall
                control.

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS THEREOF, the Agreement is executed by the parties on the Effective
      Date
      and shall become effective on said Date.

    

    Party
      A:

    Authorized
      Representative:

    Date:
      January ___, 2008

    

    Party
      B:

    Authorized
      Representative:

    Date:
      January ___, 2008

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    Index
      of
      Schedule

    

    Schedule
      1: Investment Schedule (corresponding to incentive plan)

    Schedule
      2: The
      plot of the Land and related requirements

    Schedule
      2-1: Financial Support Detailed Schedule and Item Amount

    Schedule
      3: Letter of Consent by Party A

    Schedule
      4: Forty Articles of Party A

    Schedule
      5: Authorization Letter by Mayor of Jinan City 

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Schedule
      1

     

    
      	 	a.	
              Jinan
                Hi-Tech Industries Development Zone Incentive
                Schedule

            

    

     

    Jinan
      Hi-Tech Industries Development Zone is referred to as Party A

    The
      investor is referred to as Party B

     

    
      
        	 	
                Item

              	
                Scheduled

                Time

              	
                Estimated
                  Capital 

                Injection
                  (US$K)

              	
                Subsidy
                  benchmark 

              	
                Subsidized

                Amount

                (RMB
                  K)

              
	 	
                MOU
                  Signed

              	
                11/12/2007

              	
                 

              	
                 

              	
                 

              
	 	
                Entry
                  of Contract with City Government

              	
                A

              	
                 

              	
                 

              	
                 

              
	 	
                Incorporation:
                  Business License Obtained

              	
                A+4wks

              	
                 

              	
                 

              	
                 

              
	 	
                Capital
                  paid-in: US$6.0m 1st
                  Phase

              	
                A+7wks

              	
                 

              	
                 

              	
                 

              
	
                1

              	
                Completion
                  of Factory Construction and Decoration 

              	
                7/30/2008
                  (B)

              	
                4,457

              	
                Completion
                  of Factory Construction

              	
                [*]

              
	
                2

              	
                Completion
                  of Installation of Phase 1-1 Equipment (2 SMD lines & DIP
                  facility)

              	
                B+6wks

              	
                4,281

              	
                Phase
                  1-1 Equipment Installed

                (2
                  SMD lines & DIP facility)

              	
                [*]

              
	 	
                Output
                  from the 2 Production Lines Achieving the Monthly Revenue Goal
                  (about
                  0.85kk/month for one production line)

              	
                B+14wks
                  

              	
                 

              	
                Sales
                  revenue reaches RMB 2.3m/M.

              	
                [*]

              
	 	
                Capital
                  paid-in: US$8.5
                  m 2nd
                  Phase

              	
                B+20wks

              	
                 

              	
                 

              	
                 

              
	
                3

              	
                Completion
                  of Installation of Phase 1-2 Equipment (4 SMD lines)

              	
                B+22wks

              	
                7,203

              	
                Phase
                  1-2 Equipment Installed

                (4SMD
                  lines) 

              	
                [*]

              
	 	
                Output
                  from the 6 Production Lines Achieving the Monthly Revenue Goal
                  

              	
                B+34wks

              	
                 

              	
                Sales
                  revenue reaches RMB6.8m/M

              	
                [*]

              
	
                4

              	
                Operating
                  Fund 

              	
                 

              	
                1,538

              	
                 

              	
                 

              
	 	
                Capital
                  paid-in: US$8.5
                  m 3rd
                  Phase

              	
                B+46wks

              	
                 

              	
                 

              	
                 

              
	
                5

              	
                Completion
                  of Installation of Phase 2 Equipment (4 SMD lines)

              	
                B+50wks

              	
                7,203

              	
                Phase
                  2 Equipment Installed

                (4
                  SMD lines)

              	
                [*]

              
	 	
                Output
                  from the 10 Production Lines Achieving the Monthly Revenue Goal
                  

              	
                B+62wks

              	
                 

              	
                Sales
                  revenue reaches RMB 10m/M

              	
                [*]

              
	 	
                Capital
                  paid-in: US$7.0
                  m 4th
                  Phase

              	
                B+98wks

              	
                 

              	
                 

              	
                 

              
	
                10

              	
                Completion
                  of Installation of Phase 3 Equipment (3 SMD lines)

              	
                B+102wks

              	
                5,400

              	
                 

              	
                [*]

              
	
                11

              	
                Subsidy
                  for R&D Project

              	
                 

              	
                 

              	
                 

              	
                 

              
	 	
                Total

              	
                 

              	
                30,082

              	
                 

              	
                [*]

              

      

       

      
        	
                1.  The
                  above schedule may be changed due to the market conditions.

                2.  Within
                  7 years, the investment should be no less than US$30 million.

                3.  New
                  (further) incentives for investment exceeding US$30 million should
                  be
                  negotiated separately.

              

      

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Schedule
      2: The plot of the Land and related requirements

    

    
      	1.  	
              Party
                A covenants and guarantees that Party B Subsidiary will acquire the
                land-use right certificate for the Land with
                a net area of
                75 acres
                at the price of [*]
                per acre and the road to be levied for this project will be provided
                free
                of charge. During the process of bidding, auction or public sales
                of the
                Land, if the price shall exceed [*]
                per acre, Party A shall pay for such
                excess.

            

    

    

    
      	2.  	
              Party
                B covenants that the total purchase price for the Land as part of
                the
                total investment amount under this Agreement shall be calculated
                at the
                price of [*].
                If the total purchase price shall exceed such amount, the excessive
                amount
                shall be paid by Party A and shall not be included in the total investment
                amount of Party B.

            

    

    

    
      	3.  	
               The
                plot of the Land and related
                requirements

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    Schedule
      2-1

    

    
      	1.  	
              Party
                A covenants and guarantees that it shall provide the financial support
                by
                stage and such support shall be made under the entry of industry
                development financial support and is not required to be paid back
                to Party
                A (in this Agreement, the total financial support amount may be referred
                to as “Total Financial Support Amount”). In case Party B raises the
                registered capital exceeding [*],
                Party A agrees to provide corresponding financial support, subsidy
                and
                preferential policy for such excessive
                amount.

            

    

    

    
      	2.  	
              Total
                Financial Support Amount

            

    

    

      2.1
      Upon the completion of the factory and acceptance inspection, Party A shall
      provide a cash financial support in the amount of [*].

      

      2.2
      Upon the availability of the Phase
      1-1
      Equipment (2 SMD lines & DIP facility), Party A shall directly grant
[*]
      cash
      subsidy; or purchase, at Party A's cost, part of the equipment within the amount
      of [*]
      and
      provide to Party B for Party B
      Subsidiary's
      use
      without charge indefinitely, provided that such equipment shall be transferred
      to Party B
      Subsidiary without further charge or any other sum payable when Party
      B
      Subsidiary's accumulated revenue reaches Seventy
      Million RMB (RMB70,000,000).

      

      2.3
      When
      the Phase 1-1 Equipment commences the production and the monthly sales income
      reaches [*],
      Party A
      agrees to grant a cash subsidy in the same amount. Party A shall offer such
      subsidy in the next month after Party A receives the notice and related proof
      from Party B
      Subsidiary.

      

      2.4
      Upon the availability of
      the
      Phase 1-2 Equipment (4 SMD lines), Party A shall directly grant [*]
      cash
      subsidy; or purchase, at Party A's cost, part of the equipment within the amount
      of [*]
      and
      provide to Party B for Party B Subsidiary's use without charge indefinitely,
      provided that such equipment shall be transferred to Party B Subsidiary without
      further charge
      or any other sum payable
      when
      Party B Subsidiary's accumulated
      revenue
      reaches One Hundred Seventy-Four Million RMB (RMB174,000,000).

      

      2.5
      When
      the monthly sales income reaches [*],
      Party A
      agrees to grant a cash subsidy in the same amount. Party A shall make such
      subsidy in the next month after Party A receives the notice and related proof
      from Party B
      Subsidiary.

      

      2.6
      Upon
      the availability
      of the
      Phase 2 Equipment (4 SMD lines), Party A shall directly grant [*];
      or
      purchase, at Party A's cost, part of the equipment within the amount of
[*]
      and
      provide to Party B for Party B Subsidiary's use without charge indefinitely,
      provided that such equipment shall be transferred to Party B Subsidiary without
      further charge or
      any other sum payable
      when
      Party B Subsidiary's accumulated revenue reaches Two Hundred Eighty-Three
      Million RMB (RMB283,000,000).

      

      2.7
      When
      the monthly sales income reaches Ten Million RMB (RMB10,000,000), Party A agrees
      to grant a cash subsidy in the amount of [*].
      Party A
      shall make such subsidy in the month after Party A receives the notice and
      related proof from Party B
      Subsidiary.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

      2.8
      Upon
      the availability
      of
      the
      Phase 3 Equipment (4 SMD lines), Party A shall directly grant [*]
      cash
      subsidy or purchase, at Party A's cost, part of the equipment within the amount
      of [*]
      and
      provide to Party B for Party B Subsidiary's use without charge indefinitely,
      provided that such equipment shall be transferred to Party B Subsidiary without
      further charge or
      any other sum payable
      when
      Party B Subsidiary's accumulated revenue reaches Three Hundred Ninety Two
      Million RMB (RMB392,000,000).

       

      2.9
      The
      parties shall determine whether to adopt the above cash subsidy or purchase
      by
      Party A based on the actual situation. In case the parties cannot reach
      consensus, it is deemed that the parties agree to adopt cash subsidy. Party
      A
      shall pay the amount within 20 days after the condition listed above is
      met.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    Schedule
      3 
      II.     LETTER
        OF
        CONSENT

       

    

    Jinan
      Hi-Tech Industries Development Zone Commission ("Commission") hereby consents
      to
      the following matters for the execution of the Cooperation Agreement with
      Pericom Semiconductor Corporation (USA) ("Pericom"):

     

    
      	9.  	
              Article
                2, Paragraph 1, Subparagraph 8 of the Cooperation Agreement provides
                ”While Party
                B Subsidiary reaches the planned operational objective and the various
                enterprise reports of Party B Subsidiary meet the official requirements,
                Party A could not coordinate with the Shandong
                Information Industry Department, Shandong Science and Technology
                Department and other governing authorities to have Party B Subsidiary
                acquire the certification of “hi-tech enterprise,” “software enterprise,”
                and “software product,” for
                Party B Subsidiary to legally and substantially enjoy
                the tax incentives, e.g. "Two-year
                Exemption and Three-year Half Reduction," special income tax rate
                for
                hi-tech companies, or Party B Subsidiary would fail to apply the
                preferential policies granted to the Processing Trade Manual, Party
                A
                shall increase the financial support amount in order to compensate
                the
                loss of Party B.” It is the Commission’s current understanding that,
                pursuant to the current laws, regulations and policy, if Party B
                Subsidiary reaches the planned operational objective, it is possible
                for
                the Commission to coordinate with the Shandong
                Information Industry Department, Shandong Science and Technology
                Department and other governing authorities to have Party B Subsidiary
                acquire the certification of “hi-tech enterprise,” “software enterprise,”
                and “software product,” for
                Party B Subsidiary to legally and substantially enjoy
                the tax incentives, e.g. "Two-year
                Exemption and Three-year Half Reduction," special income tax rate
                for
                hi-tech companies, and have the preferential policies granted to
                the
                Processing Trade Manual become applicable to Party B Subsidiary.
                Said
                covenants are all legal and
                feasible.

            

    

    

    
      	10.  	
              In
                the event that the Commission is unable to increase the
                financial support amount to compensate Party B’s loss, the Commission
                shall pay to compensate Party B Subsidiary's damages incurred from
                the
                taxes and expenses so increased and loss of interest income (calculated
                based on the benchmark one-year deposit inertest rate to be published
                by
                the People’s Bank of China for the same
                period).

            

    

     

    
      	 	Jinan Hi-Tech Industries Development
              Zone
              Commission

    

     

    
      	 	 
	 	Representative
	 	 
	 	January __,
              2008

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    Schedule
      4: Forty Articles of Party A

    

    Relevant
      Regulations Regarding Facilitation of the Development of Innovation and New
      Venture

     Promulgated
      by Jinan Hi-Tech Industries Development Zone Commission

    (Issued
      by Jinan Hi-Tech Industries Development Zone Commission on July 1,
      2006)

    

    In
      order
      to encourage and promote the development of Hi-Tech Industries, enhance the
      innovation ability of the enterprises located in the Hi-Tech Industries
      Development Zone (the "Zone"), improve the development environment, strengthen
      the competitive advantage of the Zone's leading enterprises in the market,
      advance the technology of the Zone and ensure continuous, rapid and sound
      economic development, according to the relevant policies and regulations
      promulgated by the P.R.C., Regulations Regarding the Hi-Tech Development in
      Shandong Province, and Regulations for Jinan Hi-Tech Industries Development
      Zone, in connection with the actual development of construction in the Zone,
      the
      relevant regulations regarding facilitation of the development of innovation
      and
      new venture are promulgated as follows:

    

    
      
        	I.	 	
                Encouragement
                  of Enterprises' Technology
                  Innovation

              

      

    

    

    
      	1.  	
              The
                Zone shall arrange the funding of not less than 10% of the yearly
                financial budgets and revenues to subsidize the development for hi-tech
                industries. The funding shall be exclusively applied toward projects
                and
                activities, such as technology research, technology innovation, protection
                of intellectual properties, investment and construction, and promotion
                of
                business growth, etc. The fund shall be provided to support the projects
                and enterprises, which have independent innovation, high technology
                and
                prosperity through methods such as subsidy for expenses, interest
                discounts for loans and fund arrangements,
                etc.

            

    

    

    
      	2.  	
              For
                the enterprises whose patent applications for inventions are filed
                with
                and reviewed by the patent office, either locally or internationally,
                each
                case will be subsidized RMB 1,000 for the application fees. Enterprises
                that obtain foreign patents for inventions in a particular year will
                be
                subsidized RMB 5,000 for the application fees in each case. Enterprises
                that obtain any kind of domestic patents in a particular year will
                be
                subsidized RMB 1,000 for the application fees for invention patent
                in each
                case, RMB 500 for utility model patents in each case and RMB 300
                for
                design patents in each case.

            

    

    

    
      	3.  	
              Enterprises
                that obtain patents for 20 cases, 30 cases, or 50 cases in a particular
                year will be respectively granted RMB 10,000, RMB 20,000 or RMB 50,000.
                

            

    

    

    
      	4.  	
              Enterprises
                that receive the Level 1, Level 2 and Level 3 awards for technology
                advancement from the nation, the province (department) or the city
                in a
                particular year will be respectively granted RMB 150,000, RMB 100,000
                or
                RMB 50,000 at the national level; RMB 50,000, RMB 30,000 or RMB 20,000
                at
                the provincial (department) level; and RMB 15,000, RMB 10,000 or
                RMB 5,000
                at the city level. If the enterprise receives two or more kinds of
                awards
                at the same time, the highest level of grant will be
                given.

            

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      	5.  	
              Enterprises
                that are recognized as national level or provincial level enterprise
                technology center and research center for engineering technology
                in a
                particular year will be respectively subsidized RMB 1,000,000 or
                RMB
                500,000. Among others, enterprises that are upgraded from low level
                to
                high level will be subsidized with the difference between the two
                levels.
                The subsidy fund will be used exclusively on the construction of
                the
                center.

            

    

    

    
      	6.  	
              Enterprises
                that apply for the fund projects supporting the innovation of the
                national
                or provincial small and medium hi-tech businesses, upon the approval
                from
                the Commission to be listed in the projects, will be subsidized the
                appropriate amount of funding according to the budgets of the nation
                or
                the upper level authorities concerned and the regulated
                percentage.

            

    

    

    
      	7.  	
              Enterprises
                that are approved to establish the post-doctorate working stations
                in a
                particular year will be subsidized RMB 100,000. Enterprises that
                are
                approved to establish the post-doctorate working station branches
                in a
                particular year will be subsidized RMB
                50,000.

            

    

    

    
      	8.  	
              Enterprises
                that obtain the national brand products and famous trademarks in
                a
                particular year will be subsidized RMB 100,000. Enterprises that
                obtain
                the provincial brand products and famous trademarks will be subsidized
                RMB
                50,000. Products and trademarks that qualify for several of the aforesaid
                honors at the same time will be granted the higher-level award. Products
                that have already received the honors and are upgraded from low level
                to
                high level will be subsidized with the difference between the two
                levels.

            

    

    

    
      	9.  	
              Software
                industries that are certified as CMM2, CMM3, CMM4 or CMM5 in a particular
                year will be respectively subsidized RMB 50,000, RMB 100,000, RMB
                150,000
                or RMB 250,000. Among others, those whose CMM certification is upgraded
                from low level to high level will be subsidized with the difference
                between the two levels.

            

    

    

    
      	10.  	
              Enterprises
                that independently bear the responsibility or bear the main responsibility
                of setting the technology standards for their products, upon the
                recognition and being adopted as international standards or national
                standards from the relevant international institutions or the national
                administrative authority concerned for standardization, will be
                respectively subsidized RMB 1,000,000 or RMB 500,000.
                

            

    

    

    
      	11.  	
              For
                the enterprises that participate in the international and national
                exhibitions for hi-tech accomplishments, hi-tech industries fairs
                and
                hi-tech seminars for technology cooperation, which are arranged and
                jointly participated in by the Zone, the subsidy of not less than
                50% of
                the booth expenses will be granted.

            

    

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    
      
        	II.	 	
                Encouragement
                  of Enterprises' Investment and Business Growth

              

      

    

     

    
      	
              12.

            	For
              investors who invest in the Zone for the construction of facilities
              for
              engaging in technological and industrial business, if their registered
              period for operation is more than 10 years and the percentage for land
              investment is more than 10% of the national standard, according to
              the
              circumstances of the investment scale, project technology capacity
              and the
              realized major financial revenues of the Zone, upon the Commission's
              approval, they will be subsidized appropriately through various
              means.
	 	 
	
              13.

            	Incubated
              enterprises that are permitted to enter in the various incubators in
              the
              Zone by the Commission will, within 3 years from the date when they
              are
              permitted to enter into the incubators, be subsidized according to
              50% of
              the Zone's major financial revenues realized in a particular year.
              Among
              others, enterprises that are established by people having studied abroad
              will, within 3 years from the date when they are permitted to enter
              into
              the incubators, be subsidized in reference to 80% of the Zone's major
              financial revenues.
	 	 
	
              14.

            	Enterprises
              that are established by people having studied abroad and engage in
              research and development of hi-tech projects with independent intellectual
              properties will, upon the Commission's approval, be subsidized from
              RMB
              30,000 to RMB 100,000 for research and development expenses.
	 	 
	
              15.

            	Technological
              and industrial enterprises whose realized revenues for a particular
              year
              are RMB 1,000,000,000 or more and whose annual growth rate for realizing
              the Zone's major financial revenues is more than 10% will be subsidized
              in
              reference to 70% of the increased portion between the Zone's major
              financial revenues for a particular year and those of the previous
              year.
	 	 
	
              16.

            	Technological
              and industrial enterprises whose realized revenues for a particular
              year
              are RMB 500,000,000 or more and whose annual growth rate for realizing
              the
              Zone's major financial revenues is more than 15% will be subsidized
              in
              reference to 60% of the increased portion between the Zone's major
              financial revenues for a particular year and those of the previous
              year.
	 	 
	
              17.

            	Technological
              and industrial enterprises whose realized revenues for a particular
              year
              are RMB 20,000,000 or more and whose annual growth rate for realizing
              the
              Zone's major financial revenues is more than 20% will be subsidized
              in
              reference to 40% of the increased portion between the Zone's major
              financial revenues for a particular year and those of the previous
              year.
	 	 
	
              18.

            	Technological
              and industrial enterprises that in a particular year complete the
              investment of RMB 20,000,000 or more in fixed assets for technological
              and
              industrial projects (software enterprises shall complete the investment
              of
              RMB 8,000,000 or more in fixed assets for technological projects),
              and
              whose realized Zone major financial revenues is RMB 500,000 more than
              the
              previous year's, will be subsidized in reference to 50% of the increased
              portion between the Zone's major financial revenues for a particular
              year
              and those of the previous year.
	 	 
	
              19.

            	For
              newly incorporated technological and industrial enterprises that do
              not
              conduct any construction on any imposed land, if their realized Zone
              major
              financial revenues every year are between RMB 1,000,000 and RMB 5,000,000
              within 3 years from the date of the incorporation, they will be subsidized
              15% of the Zone's major financial revenues realized for a particular
              year.
              Within 3 years from the date of the incorporation, if their realized
              Zone
              major financial revenues each year are above RMB 5,000,000, they will
              be
              subsidized in reference to 20% of the Zone's major financial revenues
              realized for a particular year.
	 	 
	
              20.

            	For
              the technological and industrial enterprises invested by foreigners,
              if
              their increased investment for the registered capital is more than
              US$3,000,000, within 3 years from the date when the registered
              increasedinvestment is actually made, they will be subsidized in reference
              to 60% of the increased portion between the Zone's major financial
              revenues for a particular year and those of the previous
              year.
	 	 
	
              21.

            	
              For
                newly incorporated enterprises engaging in projects of electronics,
                biological pharmaceuticals, transportation and electronic engineering
                equipment, new materials, or energy-saving technology for environment
                protection, if their actual investment in the fixed assets are between
                RMB
                50,000,000 and RMB 100,000,000; between RMB 100,000,000 and RMB
                500,000,000; or above RMB 500,000,000, respectively, within 2 years
                from
                the date of production, they will be subsidized in reference to 20%,
                30%
                or 40% of the Zone's major financial revenues, realized for a particular
                year.

            
	 	 
	
              22.

            	
              Enterprises
                that have significant and special contributions to the Zone will
                be
                subsidized with priority according to the decisions of the
                Commission.

            
	 	 
	
              23.

            	
              For
                those major representatives who make contributions to the scale growth
                of
                the technological and industrial enterprises, the subsidies will
                be
                granted to the enterprises according to the standards listed below,
                in
                order to encourage the major
                representatives:

            

    

     

    
      	(1)  	
              For
                technological and industrial enterprises whose yearly sales revenues
                are
                for the first time more than RMB 100,000,000; RMB 300,000,000; RMB
                500,000,000; RMB 1,000,000,000; RMB 3,000,000,000; RMB 5,000,000,000;
                or
                RMB 10,000,000,000; and whose Zone major financial revenues realized
                in a
                particular year correspondently reach to or above RMB 1,000,000;
                RMB
                3,000,000, RMB 5,000,000; RMB 10,000,000; RMB 30,000,000; RMB 50,000,000;
                or RMB 80,000,000; they will be respectively subsidized RMB 10,000;
                RMB
                30,000; RMB 50,000; RMB 100,000; RMB 300,000; RMB 500,000; and RMB
                1,000,000. 

            

    

    

    
      	(2)  	
              Enterprises
                that conduct an Initial Public Offering (IPO) will be subsidized
                RMB
                100,000.

            

    

    

    
      	(3)  	
              For
                enterprises that are independent legal entities invested and incorporated
                by the top 500 enterprises in the world (according to the Fortune
                Magazine), and are engaged in the businesses of electronics, biological
                pharmaceuticals, transportation and electronic engineering equipment,
                new
                materials, or energy-saving technology for environmental protection,
                with
                investment in fixed assets of more than RMB 30,000,000 or with yearly
                sales revenues of more than RMB 50,000,000, or software enterprises
                with
                yearly sales revenues of more than RMB 10,000,000: their general
                managers,
                vice general managers and key R&D personnel (not more than 8 people)
                will be individually subsidized in reference to 50% of the Zone's
                major
                financial revenues, which are to be granted to the individual within
                3
                years from the date when he or she is on
                board.

            

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    
      	(4)  	
              Enterprises
                that successfully form a joint venture or cooperate with any of the
                top
                500 global enterprises or any of the top 100 domestic listed enterprises
                (according to the ranking in the year when the joint venture is formed
                or
                the cooperation occurs), which make the actual investment in the
                forms of
                capital, technology, or equipment in the amount of more than RMB
                10,000,000, will be subsidized RMB
                100,000.

            

    

    

    
      
        	III.	 	
                Encouragement
                  of Development of Technology Service
                  Institutions

              

      

    

     

    
      	
              24.

            	Technology
              service institutions that provide direct service for the technology
              innovation of the Zone will, upon the Commission's decisions, within
              3
              years from the date when they are registered in the Zone, be subsidized
              in
              reference to 60% of the increased portion between the Zone's major
              financial revenues for a particular year and those of the previous
              year.
	 	 
	
              25.

            	The
              Zone shall arrange not less than RMB 1,000,000 every year for the
              reimbursement of the losses incurred by the guarantees for loans, which
              will be used for reimbursement of the institutions that are approved
              by
              the Zone for providing guarantee for the Hi-tech enterprises' loans
              in
              order to engage in technology research and development.
	 	 
	
              26.

            	For
              the institutions engaging in the business of risk investment and venture
              capital, if their investment in the projects within the Zone is more
              than
              50% of their total investment in a particular year, they will be
              subsidized in reference to 60% of the Zone's major financial revenues
              realized in a particular year

    

     

    
      	IV.	
              Encouragement
                of Introduction and Cultivation of Manpower for Innovation and New
                Venture

            

    

     

    
      
        	
                27.

              	
                For
                  people who studied abroad and high-level talents from other provinces
                  who
                  come to the Zone to engage in technology innovation or start an
                  enterprise, the relevant authorities concerned in the Zone shall
                  arrange
                  for them the first priority for administrative procedures regarding
                  recruiting, labor insurances, domicile registration, etc. and also
                  provide
                  them with excellent service in medical insurance, recruiting professional
                  technical job, housing and children's schooling.

              
	 	 
	
                28.

              	
                For
                  the post-doctorate researchers who are recruited by the post-doctorate
                  working stations in the Zone in order to engage in technology research
                  and
                  development, the enterprises who recruit them will be subsidized
                  not less
                  than RMB 20,000 every year and not more than RMB 50,000 in a consecutive
                  2-year period per person during their service periods in order
                  to
                  subsidize the technology research and development and accommodate
                  the
                  post-doctorate researchers' work, life and
                  needs.

              

      

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      
        	
                29.

              	For the high level technology
                talents, who are introduced to or recognized by the responsible
                departments in the Zone and start enterprises to engage in the research
                and development in technology and transformation of hi-tech
                accomplishments, upon the Commission's approval, they will be subsidized
                interest discount for a year for a loan in the amount of not more
                than RMB
                1,000,000. 

      

    

     

     

    
      	V.	
              Improvement
                of the Environments for Innovation or New
                Venture

            

    

     

    
      	
              30.

            	
              The
                Zone will provide one-stop service for enterprises and individuals
                who
                come to the Zone to invest in technology innovation or to start an
                enterprise, including conducting the procedures of corporation
                registration, project confirmation, planning, land use, construction,
                and
                providing the follow-up service regarding project completion and
                production.

            
	 	 
	
              31.

            	
              When
                the Zone enterprises are conducting the corporation registration,
                except
                for the business scopes, which are restricted by the applicable laws
                and
                administrative regulations, Departments for Industry and Commerce
                will not
                restrict their business scopes.

            
	 	 
	
              32.

            	
              The
                Zone is adopting the "contact window" system, in which the coordinators
                provide service for the enterprise development, providing the coordination
                service through the responsible person at a fixed spot for important,
                technological, industrial enterprises, institutions for technology
                research, project unit entering the Zone, providing the enterprises
                with
                consultations on law and policy, providing assistance in solving
                the
                difficulties and problems faced by the enterprises, and providing
                general
                services for the enterprises.

            
	 	 
	
              33.

            	
              The
                Zone is adopting the public announcement system for charging the
                administrative service fee. All the items for the service charge,
                the
                scope, the standards, the bases and the procedures are publicly announced.
                Except for those fees that need to be paid to the central government,
                provinces and cities, the Zone will not charge any additional fees
                that
                may be waived, and will only charge the minimum fees according to
                the
                applicable national regulations.

            
	 	 
	
              34.

            	
              If
                an enterprise considers that its legal right has been infringed by
                the
                administrative actions taken by the Zone, it can file a complaint
                with the
                Department of Supervision in the Zone. The Department will deal with
                the
                complaint within 10 days after receipt of the filing of the complaint
                if
                the complaint is within the jurisdiction of the Commission. If the
                complaint is not within the jurisdiction of the Commission, such
                complaint
                will be transferred to the authority concerned within 3 days after
                receipt
                of the filing of the complaint, and a written status report will
                be sent
                to the complainant unless otherwise stipulated by the applicable
                law.

            

    

     

    
      	VI.	
              Miscellaneous

            

    

     

    
      	
              35.

            	
               Enterprises
                that are entitled to the subsidies or incentives as set forth in
                the
                Regulations must be directly within the jurisdiction of the tax bureau
                in
                the Zone and be ranked in the financial revenue level in the Zone.
                Except
                for those enterprises entering the Zone for the first year and those
                incubated enterprises approved to be in any kind of the incubators
                in the
                Zone, the subsidies will be subject to the maximum of the increased
                portion of the Zone's major financial revenues in a particular
                year.

            

    

     

    The
      subsidy and encouragement fund shall be used in the R&D activities and
      production of the enterprise concerned.

     

    
      	
              36.

            	
              According
                to the different categories, enterprises can enjoy the tax incentives
                that
                are provided for hi-tech industries, enterprises invested by foreigners,
                software enterprises, and other incentives provided by the province
                and
                cities.

            
	 	 
	
              37.

            	
              An
                enterprise that is entitled to several incentives according to the
                Regulations may choose the most favorable incentive and cannot enjoy
                double incentives.

            
	 	 
	
              38.

            	
              The
                economic index, upon which the Regulations will be based and applied,
                is
                based on the data calculated by the Zone and provided by the Department
                of
                Finance.

            
	 	 
	
              39.

            	
              The
                incentives granted to the individuals according to the Regulations
                are
                subject to taxation, and the authority, which grants the incentives,
                should withhold the tax.

            
	 	 
	
              40.

            	
              These
                Regulations shall be effective as of the promulgation date, and are
                subject to the interpretations of the Economic Development Bureau
                in the
                Zone.

              The
                relevant authorities concerned at the Commission, in connection with
                the
                Commission's responsibility, will stipulate the relevant rules for
                enforcement of the Regulations.

            
	 	 
	 	
              If
                there is any discrepancy between the previous policies and regulations
                published by the Commission and the Regulations, the Regulations
                shall
                prevail.

            

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    Schedule
      5

     

    
      III. 
        AUTHORIZATION LETTER

        
           

        

      

    

    Regarding
      the Cooperation Agreement to be entered into by and between Jinan Hi-Tech
      Industries Development Zone Commission ("Commission") and Pericom Semiconductor
      Corporation (USA) ("Pericom"), the undersigned hereby confirms the authorization
      below:

     

     

    
      	1.  	
              The
                Commission is a subordinate department of the Jinan Municipal People's
                Government ("Government"). Mr. Su Shu-Wei is the representative of
                the
                Commission. The Government agrees to the entry of the Cooperation
                Agreement between the Commission and Pericom. In the meantime, the
                Government has requested the Commission to strengthen its service
                and
                coordinate with related departments to facilitate the project process
                and
                speed up the construction in order to have the invested company start
                the
                mass production and reach the production goal as soon as
                possible.

            
	 	 
	2.	
              The
                Government agrees to and will support each of the incentives and
                financial
                support committed by the Commission under the Cooperation Agreement.
                In
                the event that the administrative organization or administrative
                territory
                division of the Commission changes, such change shall in no event
                affect
                the effect and enforceability of the Cooperation Agreement and shall
                continue to be performed by the succeeding department. 

            
	 	 
	3. 	The authorization and covenant under
              this
              Letter shall become effective concurrently with the execution of the
              Cooperation Agreement and shall be irrevocable during the term of the
              Cooperation Agreement. 

    

    
       

       

    

    
      	 	Jinan Municipal People's
              Government

    

     

    
      	 	Mayor
	 	 
	 	January __,
              2008

    

     

    
      
        
        

      

      
        21STOCK
      PURCHASE AGREEMENT

    

    STOCK
      PURCHASE AGREEMENT, dated as of April 15, 2008 but effective as of the Closing
      Date (defined herein) (this “Agreement”),
      by
      and among Cyberspace Vita, Inc., a Nevada corporation (the “Company”),
      Henry
      C. Casden (the “Seller”)
      and
      the entities listed on Exhibit
      A
      (the
“Purchaser”).
      The
      Company, the Seller and the Purchaser are individually referred to herein as
      a
“Party”
and
      collectively, as the “Parties”.

    

    BACKGROUND

    

    The
      Seller is the owner of 4,000,000 shares of common stock of the Company (the
      “Seller
      Shares”).
      The
      Seller desires to sell and the Purchaser desires to purchase the Seller Shares
      which represent approximately 80.8%
      of
      the issued and outstanding capital stock of the Company as of the date hereof
      calculated on a fully-diluted basis pursuant to the terms hereof. 

    

    AGREEMENT

    

    NOW,
      THEREFORE, in consideration of the foregoing and the mutual promises and
      covenants herein contained, the Company, the Seller and the Purchaser hereby
      agree as follows: 

    

    1. Purchase
      and Sale.

     

    The
      Seller shall sell, transfer, convey and deliver unto the Purchaser the Seller
      Shares and the Purchaser shall acquire and purchase from the Seller, the Seller
      Shares.

    

    2. Purchase
      Price.

     

    (a) General.
      The
      purchase price (the “Purchase
      Price”)
      for
      the Seller Shares, in the aggregate, is Four Hundred Thousand Dollars
      ($400,000.00) payable as specified in this Section
      2
      subject
      to the other terms and conditions of this Agreement.

     

    (b) Cash
      Deposit.
      At the
      end of the Due Diligence Period (defined in Section
      7),
      the
      Purchaser shall make a cash deposit into the trust account of Robert L. B.
      Diener, Esq.(“Diener”),
      in
      the amount of Fifty Thousand Dollars ($50,000.00) (the “Cash
      Deposit”)
      which
      shall be fully credited against the Purchase Price at the Closing (as defined
      below). The Cash Deposit shall be wired to Seller by Diener by Federal funds
      wire transfer on April, 15, 2008. If the Seller complies with all terms set
      forth herein and the Closing does not occur solely due to the failure of the
      Purchaser to perform its obligations hereunder, then the Cash Deposit shall
      be
      retained by the Seller as liquidated damages and shall become
      non-refundable.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (c) Accounting
      Payment.
      At the
      end of the Due Diligence Period, the Purchaser shall make a cash deposit into
      the trust account of Diener in the amount of Twenty Two Thousand Three Hundred
      Thirty Eight Dollars and Fifty Cents ($22,338.50) (the “Accounting
      Payment”)
      which
      amount shall be fully credited against the Purchase Price at the Closing. The
      Accounting Payment represents the total aggregate amounts due for certain
      Liabilities (as defined under Section
      2(e))
      payable
      to De
      Joya
      Griffith & Company, LLC and Lynda Keeton CPA by
      the
      Company.
      On or
      before, April 21, 2008, Diener shall cause the Accounting Payment to be
      disbursed, by Federal funds wire transfers, to: De
      Joya
      Griffith & Company, LLC ($8,021.00) and
      Lynda
      Keeton CPA ($14,317.50).

     

    (d) Payment
      at Closing.
      At the
      Closing, the Purchaser shall, subject to Section
      2(e),
      pay to
      the Seller the Purchase Price consisting of Three Hundred Twenty Seven Thousand
      Six Hundred and Sixty-One Dollars and Fifty Cents ($327,661.50) (the
“Escrow
      Deposit”),
      the
      Cash Deposit and the Accounting Payment.

     

    (e) Adjustment
      for Outstanding Liabilities.
      If the
      Company has any liability (whether known or unknown, whether asserted or
      unasserted, whether absolute or contingent, whether accrued or unaccrued,
      whether liquidated or unliquidated, and whether due or to become due), including
      any liability for taxes (“Liability(ies)”),
      as of
      the Closing, the portion of the Purchase Price payable at the Closing shall
      be
      reduced on a dollar for dollar basis by the amount of such Liability and the
      amounts payable by Purchaser hereunder shall be reduced accordingly. For the
      purposes of this Agreement, Liabilities include shall the Accounting Payment
      payable by the Company to De
      Joya
      Griffith & Company, LLC and Lynda Keeton CPA.

     

    3. The
      Closing.

     

    (a) General.
      The
      closing of the transactions contemplated by this Agreement (the “Closing”)
      shall
      take place by exchange of documents among the Parties by fax or courier, as
      appropriate, following the satisfaction or waiver of all conditions to the
      obligations of the Parties to consummate the transactions contemplated hereby
      (other than conditions with respect to actions the respective Parties will
      take
      at the Closing itself) on May 5, 2008 (the “Closing
      Date”).

     

    (b) Delivery
      of Certificates and Escrow Deposit into Escrow.
      The
      Parties shall deliver the following to Thelen Reid Brown Raysman & Steiner
      LLP (the “Law
      Firm”)
      by
      April 30, 2008: (i) the Seller shall deliver certificates (the “Certificate(s)”)
      evidencing all of the Seller Shares together with duly executed,
      medallion-guaranteed Stock Powers with respect thereto; and (ii) the Purchaser
      shall deposit by wire transfer the Escrow Deposit and the Broker Payments (as
      defined in Section
      8).
      The Law
      Firm shall hold the Certificate(s) and the Escrow Deposit in escrow pursuant
      to
      the Escrow Agreement (the “Escrow
      Agreement”)
      in the
      form of Exhibit
      B
      being
      entered into on the date hereof by the Law Firm, the Seller and the Purchaser
      until the Closing at which time the Law Firm shall deliver the Certificates
      to
      the Purchaser against delivery to the Seller of the Escrow Deposit, less
      Liabilities, if any, that are due at Closing. 

     

    (c) Deliveries
      at the Closing.
      At the
      Closing: (i) the Seller shall deliver to the Purchaser the various certificates,
      instruments, and documents referred to in Section
      11(a)
      below,
      (ii) the Purchaser shall deliver to the Seller the various certificates,
      instruments, and documents referred to in Section
      11(b)
      below,
      (iii) the Law Firm shall deliver to the Purchaser the Certificates, endorsed
      in
      blank or accompanied by duly executed assignment documents and including a
      Medallion Guarantee, including delivery by releasing the Certificates from
      escrow, (iv) the Law Firm shall deliver to the Seller the Escrow Deposit less
      any Liabilities by Federal funds wire transfer, and (v) the Law Firm shall
      deliver the Broker Payments respectively to Excelsus Capital Partners LLC
      ($35,000.00) and Growth Direct, LLC ($35,000.00) by Federal funds wire
      transfer.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    4. Representations
      and Warranties of the Seller.

     

    The
      Seller represents and warrants to the Purchaser that the statements contained
      in
      this Section
      4
      are
      correct and complete as of the date of this Agreement and will be correct and
      complete as of the Closing Date (as though made then and as though the Closing
      Date were substituted for the date of this Agreement throughout this
Section
      4).

     

    (a) The
      Seller has the power and authority to execute, deliver and perform such the
      Seller’s obligations under this Agreement and to sell, assign, transfer and
      deliver to the Purchaser the Seller Shares as contemplated hereby. No permit,
      consent, approval or authorization of, or declaration, filing or registration
      with any governmental or regulatory authority or consent of any third party
      is
      required in connection with the execution and delivery by the Seller of this
      Agreement and the consummation of the transactions contemplated
      hereby.

     

    (b) Neither
      the execution and delivery of this Agreement, nor the consummation of the
      transactions contemplated hereby or compliance with the terms and conditions
      hereof by the Seller will violate or result in a breach of any term or provision
      of any agreement to which the Seller is bound or is a party, or be in conflict
      with or constitute a default under, or cause the acceleration of the maturity
      of
      any obligation of the Seller under any existing agreement or violate any order,
      writ, injunction, decree, statute, rule or regulation applicable to the Seller
      or any properties or assets of the Seller.

     

    (c) This
      Agreement has been duly and validly executed by the Seller, and constitutes
      the
      valid and binding obligation of the Seller and the Company, enforceable against
      the Seller and the Company in accordance with its terms, except as
      enforceability may be limited by bankruptcy, insolvency or other laws affecting
      creditors’ rights generally or by limitations, on the availability of equitable
      remedies.

     

    (d) The
      Seller Shares are owned beneficially and of record by the Seller and are validly
      issued and outstanding, fully paid for and non-assessable with no personal
      liability attaching to the ownership thereof. The Seller owns the Seller Shares
      free and clear of all liens, charges, security interests, encumbrances, claims
      of others,
      options,
      warrants, purchase rights, contracts, commitments, equities or other claims
      or
      demands of any kind
      (collectively, “Liens”),
      and
      upon delivery of the Seller Shares to the Purchaser, the Purchaser will acquire
      good, valid and marketable title thereto free and clear of all Liens.
The
      Seller is not a party to any option, warrant, purchase right, or other contract
      or commitment that could require the Seller to sell, transfer, or otherwise
      dispose of any capital stock of the Company (other than pursuant to this
      Agreement). The Seller is not a party to any voting trust, proxy, or other
      agreement or understanding with respect to the voting of any capital stock
      of
      the Company.

     

    (e) The
      Sellers Shares were acquired by Seller free and clear of all Liens from the
      following former stockholders of the Company, Robert T. Yarbray and Eleanor
      Yarbray (together, the “Yarbrays”)
      on
      November 7, 2006 (with the shares officially issued to Seller by the Company’s
      transfer agent on October 1, 2007), as payment for certain legal services
      provided on behalf of the Yarbrays by the Seller.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    (f) The
      date
      of acquisition of the Seller Shares are true and correct.

     

    5. Representations
      and Warranties of the Company.

     

    The
      Company and the Seller, jointly and severally, represent and warrant to the
      Purchaser that the statements contained in this Section
      5
      are
      correct and complete as of the date of this Agreement and will be correct and
      complete as of the Closing Date (as though made then and as though the Closing
      Date were substituted for the date of this Agreement throughout this
Section
      5).

    

    (a) The
      Company is a corporation in good standing duly incorporated in the State of
      Nevada. The
      Company is duly authorized to conduct business and is in good standing under
      the
      laws of each jurisdiction where such qualification is required. The Company
      has
      full corporate power and authority and all licenses, permits, and authorizations
      necessary to carry on its business. The Company has no subsidiaries and does
      not
      control any other subsidiaries, directly or indirectly, or have any direct
      or
      indirect equity participation in any other entity.

     

    (b) Neither
      the execution and delivery of this Agreement, nor the consummation of the
      transactions contemplated hereby or compliance with the terms and conditions
      hereof by the Company will violate or result in a breach of any term or
      provision of any agreement to which the Company is bound or is a party, or
      the
      Company’s Articles of Incorporation or By-Laws, or be in conflict with or
      constitute a default under, or cause the acceleration of the maturity of any
      obligation of the Company under any existing agreement or violate any order,
      writ, injunction, decree, statute, rule or regulation applicable to the Company
      or any of its properties or assets.

     

    (c) This
      Agreement has been duly and validly executed by the Company and constitutes
      the
      valid and binding obligation of the Company, enforceable against it in
      accordance with its terms, except as enforceability may be limited by
      bankruptcy, insolvency or other laws affecting creditors’ rights generally or by
      limitations, on the availability of equitable remedies.

     

    (d) The
      Company’s authorized capital stock, as of the date of this Agreement and as of
      the Closing, consists of 100,000,000 shares of common stock, $0.001 par value
      per share (the “Common
      Stock”),
      of
      which 4,951,000
      shares are issued and outstanding and no shares of preferred stock. The Company
      has not reserved any shares of its Common Stock for issuance upon the exercise
      of options, warrants or any other securities that are exercisable or
      exchangeable for, or convertible into, Common Stock. All of the issued and
      outstanding shares of Common Stock are validly issued, fully paid and
      non-assessable and have been issued in compliance with applicable laws,
      including, without limitation, applicable federal and state securities laws.
      There are no outstanding options, warrants or other rights of any kind to
      acquire any additional shares of capital stock of the Company or securities
      exercisable or exchangeable for, or convertible into, capital stock of the
      Company, nor is the Company committed to issue any such option, warrant, right
      or security. There are no agreements relating to the voting, purchase or sale
      of
      capital stock (i) between or among the Company and any of its stockholders,
      (ii)
      between or among the Seller and any third party, or (iii) to the best knowledge
      of the Seller between or among any of the Company’s stockholders. The Company is
      not a party to any agreement granting any stockholder of the Company the right
      to cause the Company to register shares of the capital stock of the Company
      held
      by such stockholder under the Securities Act. The stockholder list provided
      to
      the Purchaser is a current shareholder list generated by its transfer agent,
      and
      such list accurately reflects all of the issued and outstanding shares of the
      Company’s Common Stock.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    (e) The
      Company does not have any restrictions in place relative to its ability to
      implement any reverse split of its common stock.

     

    (f) As
      of the
      date hereof, the Company has total Liabilities of no more than
      $1,000.00, which
      Liabilities will be paid off at or prior to the Closing and which Liabilities
      shall in no event become Liabilities of the Purchaser or remain Liabilities
      of
      the Company following the Closing and, as of the Closing Date, will have no
      assets.

     

    (g) The
      Seller is the beneficial holder of record of the Seller Shares.

     

    (h) There
      is
      no legal, administrative, investigatory, regulatory or similar action, suit,
      claim or proceeding which is pending or, to the Seller’s knowledge, threatened
      against the Company.

     

    (i) The
      Company has one market
      maker for its common shares and such market makers have obtained all permits
      and
      made all filings necessary in order for such market makers to continue as market
      makers of the Company.

     

    (j) During
      the period from its inception through March 31, 2008, the Company has filed
      or
      furnished (i) all reports, schedules, forms, statements, prospectuses and
      other documents required to be filed with, or furnished to, the Securities
      and
      Exchange Commission (the “SEC”)
      by the
      Company (all such documents, as amended or supplemented, are referred to
      collectively as, the “Company
      SEC Documents”)
      and
      (ii) all certifications and statements required by (x) Rule 13a-14 or
      15d-14 under the Exchange Act, or (y) 18 U.S.C. §1350 (Section 906 of the
      Sarbanes-Oxley Act of 2002) with respect to any applicable Company SEC Document
      (collectively, the “SOX
      Certifications”).
      The
      Company has made available to the Purchaser all SOX Certifications and comment
      letters received by the Company from the staff of the SEC and all responses
      to
      such comment letters by or on behalf of the Company. Through March 31, 2008,
      the
      Company complied in all respects with its SEC filing obligations under the
      Exchange Act and the Securities Act.  Each of the audited financial
      statements and related schedules and notes thereto and unaudited interim
      financial statements of the Company (collectively, the “Company
      Financial Statements”)
      contained in the Company SEC Documents (or incorporated therein by reference)
      were prepared in accordance with United States generally accepted accounting
      principles applied on a consistent basis (“GAAP”)
      (except in the case of interim unaudited financial statements) except as noted
      therein, and fairly present in all respects the consolidated financial position
      of the Company and its consolidated subsidiaries as of the dates thereof and
      the
      consolidated results of their operations, cash flows and changes in
      stockholders’ equity for the periods then ended, subject (in the case of interim
      unaudited financial statements) to normal year-end audit adjustments (the effect
      of which will not, individually or in the aggregate, be adverse) and, such
      financial statements complied as to form as of their respective dates in all
      respects with applicable rules and regulations of the SEC. The financial
      statements referred to herein reflect the consistent application of such
      accounting principles throughout the periods involved, except as disclosed
      in
      the notes to such financial statements. No financial statements of any Person
      not already included in such financial statements are required by GAAP to be
      included in the consolidated financial statements of the Company.  As of
      their respective dates, each of the Company SEC Documents was prepared in
      accordance with and complied with the requirements of the Securities Act or
      the
      Exchange Act, as applicable, and the rules and regulations thereunder, and
      the
      Company SEC Documents (including all financial statements included therein
      and
      all exhibits and schedules thereto and all documents incorporated by reference
      therein) did not, as of the date of effectiveness in the case of a registration
      statement, the date of mailing in the case of a proxy or information statement
      and the date of filing in the case of other the Company SEC Documents, contain
      any untrue statement of a fact or omit to state a fact required to be stated
      therein or necessary to make the statements therein, in the light of the
      circumstances under which they were made, not misleading. Neither the Company
      nor, to the Company’s knowledge, any of its officers has received notice from
      the SEC or any other governmental authority questioning or challenging the
      accuracy, completeness, content, form or manner of filing or furnishing of
      the
      SOX Certifications.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    (k) The
      Company has properly and timely filed all federal, state and local tax returns
      and has paid all taxes, assessments and penalties due and payable. All such
      tax
      returns were complete and correct in all respects as filed, and no claims have
      been assessed with respect to such returns. There are no present, pending,
      or
      threatened audit, investigations, assessments or disputes as to taxes of any
      nature payable by the Company or its subsidiary, nor any tax liens whether
      existing or inchoate on any of the assets of the Company or any of its
      subsidiaries, except for current year taxes not presently due and payable.
      No
      IRS or foreign, state, county or local tax audit is currently in progress.
      Neither the Company nor its subsidiary has waived the expiration of the statute
      of limitations with respect to any taxes. There are no outstanding requests
      by
      the Company or its subsidiary for any extension of time within which to file
      any
      tax return or to pay taxes shown to be due on any tax return.

     

    (l) The
      Company does not have any ongoing operations and does not employ any employees
      and does not maintain any employee benefit or stock option plans.

     

    (m) Except
      as
      set forth in Schedule
      5(m)
      annexed
      hereto, since March 31, 2008, there has not been any event or condition of
      any
      character which has adversely affected, or may be expected to adversely affect,
      the Company’s business or prospects, including, but not limited to any adverse
      change in the condition, assets, liabilities (existing or contingent) or
      business of the Company from that shown in the financial statements of the
      Company included in its quarterly report on Form 10-QSB filed for the fiscal
      quarter ended March 31, 2008.

     

    (n) The
      Company has complied in all material respects with all applicable laws
      (including rules, regulations, codes, plans, injunctions, judgments, orders,
      decrees, rulings, and charges thereunder) of all governmental authorities,
      and
      no action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      demand, or notice has been filed or commenced against the Company alleging
      any
      failure so to comply. To the Seller’s knowledge, neither the Company, nor any
      officer, director, employee, consultant or agent of the Company has made,
      directly or indirectly, any payment or promise to pay, or gift or promise to
      give or authorized such a promise or gift, of any money or anything of value,
      directly or indirectly, to any governmental official, customer or supplier
      for
      the purpose of influencing any official act or decision of such official,
      customer or supplier or inducing him, her or it to use his, her or its influence
      to affect any act or decision of a governmental authority or customer, under
      circumstances which could subject the Company or any officers, directors,
      employees or consultants of the Company to administrative or criminal penalties
      or sanctions.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    (o) No
      representation or warranty by the Company in this Agreement, nor in any
      certificate, schedule or exhibit delivered or to be delivered pursuant to this
      Agreement contains or will contain any untrue statement of material fact, or
      omits or will omit to state a material fact necessary to make the statements
      herein or therein, in light of the circumstances under which they were made,
      not
      misleading.

     

    6. Representations
      and Warranties of the Purchaser.

     

    The
      Purchaser represents and warrants to the Seller as follows:

    

    (a) The
      Purchaser has full power and authority to enter into this Agreement and to
      carry
      out the transactions contemplated hereby. This Agreement constitutes a valid
      and
      binding obligation of the Purchaser enforceable in accordance with its terms,
      except as (i) the enforceability hereof may be limited by bankruptcy, insolvency
      or similar laws affecting the enforceability of creditor’s rights generally and
      (ii) the availability of equitable remedies may be limited by equitable
      principles of general applicability.

     

    (b) Neither
      the execution and delivery of this Agreement nor the consummation of the
      transactions contemplated hereby, nor compliance by the Purchaser with any
      of
      the provisions hereof will: violate, or conflict with, or result in a breach
      of
      any provision of, or constitute a default (or an event which, with notice or
      lapse of time or both, would constitute a default) under, or result in the
      termination of, or accelerate the performance required by, or result in the
      creation of any Lien upon any of the properties or assets of the Purchaser
      under
      any of the terms, conditions or provisions of any material note, bond,
      indenture, mortgage, deed or trust, license, lease, agreement or other
      instrument or obligation to which he is a party or by which he or any of his
      properties or assets may be bound or affected, except for such violations,
      conflicts, breaches or defaults as do not have, in the aggregate, any material
      adverse effect; or violate any material order, writ, injunction, decree,
      statute, rule or regulation applicable to the Purchaser or to any of its
      properties or assets, except for such violations which do not have, in the
      aggregate, any material adverse effect.

     

    (c) The
      Purchaser is acquiring the Seller Shares for its own account for investment
      and
      not for the account of any other person and not with a view to or for
      distribution, assignment or resale in connection with any distribution within
      the meaning of the Securities Act. The Purchaser agrees not to sell or otherwise
      transfer the Seller Shares unless they are registered under the Securities
      Act
      and any applicable state securities laws, or an exemption or exemptions from
      such registration are available. The Purchaser has the requisite knowledge
      and
      experience in financial and business matters such that it is capable of
      evaluating the merits and risks of acquiring the Securities.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    (d) No
      permit, consent, approval or authorization of, or declaration, filing or
      registration with any governmental or regulatory authority or the consent of
      any
      third party is required in connection with the execution and delivery by the
      Purchaser of this Agreement and the consummation of the transactions
      contemplated hereby.

     

    (e) The
      Purchaser is aware that the Seller is an affiliate of the Company and that
      the
      Seller Shares are restricted in accordance with Rule 144 of the Securities
      Act.

    

    7. Due
      Diligence.

     

    Prior
      to
      the Closing, the Purchaser has conducted a due diligence investigation relative
      to the Company and the representations, warranties and covenants of the Seller
      and the Company. The Seller and the Company have previously provided the
      Purchaser and its agents and representatives with any and all due diligence
      documents reasonably requested, including but not limited to financial
      statements and evidence of the Company’s good standing in all jurisdictions
      where it is authorized to do business. The Purchaser may, in its sole
      discretion, terminate this transaction prior to the Closing during the due
      diligence period starting April 1, 2008 and ending on April 14, 2008 (the
“Due
      Diligence Period”)
      without further liability if (i) the Purchaser shall determine that any
      representation, warranty or covenant of the Seller or the Company is untrue
      or
      misleading or cannot be otherwise verified or (ii) the Purchaser shall determine
      that the Company is unsuitable for its intend purposes.

    

    8. Brokers
      and Finders.

     

    At
      the
      Closing, in addition to the payment of the Purchase Price, the Purchaser shall
      be responsible for the payment of an aggregate of $70,000.00 to
      Exelsus Capital Partners LLC and Growth Direct, LLC (the “Broker
      Payments”).
      The
      Seller and the Company hereby represent and warrant to the Purchaser, that
      other
      than the foregoing, there are no other finders and no parties shall be
      responsible for the payment of any finders’ fees other than as specifically set
      forth herein and neither
      the Seller nor the Company, nor any of their respective directors, officers
      or
      agents on their behalf, have incurred any obligation or liability, contingent
      or
      otherwise, for brokerage or finders’ fees or agents’ commissions or financial
      advisory services or other similar payment in connection with this Agreement.
      

     

    9. Pre-Closing
      Covenants.

     

    The
      Parties agree as follows with respect to the period between the execution of
      this Agreement and the Closing.

     

    (a) General.
      Each of
      the Parties will use their best efforts to take all action and to do all things
      necessary, proper, or advisable in order to consummate and make effective the
      transactions contemplated by this Agreement (including satisfaction, but not
      waiver, of the closing conditions set forth in Section
      11
      below).

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    (b) Form
      8-K Filing; Notices and Consents.
      Concurrent with the Closing of this Agreement, the Company through the Purchaser
      shall cause a Form 8-K to be filed with the SEC with respect to its having
      entered into a “material
      contract.”
The
      Seller will cause the Company to give any notices to third parties, and will
      cause the Company to use its best efforts to obtain any third party consents
      that the Purchaser may reasonably request. Each of the Parties will (and the
      Seller will cause the Company to) give any notices to, make any filings with,
      and use its best efforts to obtain any authorizations, consents, and approvals
      of governmental authorities necessary in order to consummate the transactions
      contemplated hereby. The parties acknowledge that SEC Rule 14f-1 under the
      Exchange Act requires that an information statement containing certain specified
      disclosures be filed with the SEC and mailed to the Company’s shareholders at
      least 10 days before any person designated by the Purchaser can become a
      director of the Company. The Purchaser and the Seller agree to cooperate fully
      with the Company in the preparation and filing of such information statement
      and
      to provide all information therefor respectively needed from them in a timely
      manner, so as not to cause undue delay in the filing of the information
      statement or any amendment thereto. Otherwise, neither the Company nor the
      Seller is aware of any third party consent nor other filing or notice to third
      parties that is necessary in respect of this Agreement.

     

    (c) Prohibited
      Activities.
      The
      Seller will not cause or permit the Company to engage in any practice, take
      any
      action, or enter into any transaction except for ministerial matters necessary
      to maintain the Company in good standing and to arrange for the filing of all
      necessary reports required to be filed by the Company under the Exchange Act.
      Without limiting the generality of the foregoing, the Seller will not cause
      or
      permit the Company to (i) declare, set aside, or pay any dividend or make any
      distribution with respect to its capital stock or redeem, purchase, or otherwise
      acquire any of its capital stock except as otherwise expressly specified herein,
      (ii) issue, sell, or otherwise dispose of any of its capital stock, or grant
      any
      options, warrants, preemptive or other rights to purchase or obtain (including
      upon conversion, exchange, or exercise) any of its capital stock, (iii) make
      any
      capital expenditures, loans, or incur any other obligations or liabilities,
      (iv)
      enter into any agreements involving expenditures individually, or in the
      aggregate, of more than $1,000 (other than as permitted hereunder or agreements
      for professional services which will be paid in full at or prior to the
      Closing), (v) enter into any agreement or incur any other commitment or (vi)
      otherwise engage in any practice, take any action, or enter into any transaction
      that is inconsistent with the transactions contemplated hereby.

     

    (d) Notice
      of Developments.
      The
      Seller shall give prompt written notice to the Purchaser of any material adverse
      development causing a breach of any of the representations and warranties in
      Section
      5
      above.
      No disclosure by any Party pursuant to this Section, however, shall be deemed
      to
      amend or supplement the disclosures contained in the Schedules hereto or to
      prevent or cure any misrepresentation, breach of warranty, or breach of
      covenant.

     

    (e) Exclusivity.
      Prior
      to the Closing Date, neither the Seller nor the Company shall, directly or
      indirectly, (i) solicit, initiate, or encourage the submission of any proposal
      or offer from any person relating to the acquisition of the Seller Shares or
      any
      capital stock or other voting securities, or any assets (including any
      acquisition structured as a merger, consolidation, or share exchange) of the
      Company or (ii) participate in any discussions or negotiations regarding,
      furnish any information with respect to, assist or participate in, or facilitate
      in any other manner any effort or attempt by any person to do or seek any of
      the
      foregoing. The Seller will vote the Seller Shares in favor of any such
      acquisition structured as a merger, consolidation, or share exchange. The Seller
      shall notify the Purchaser immediately if any person makes any proposal, offer,
      inquiry, or contact with respect to any of the foregoing.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    10. Post-Closing
      Covenants.  The
      Parties agree as follows with respect to the period following the
      Closing.

     

    (a) General.
      In case
      at any time after the Closing any further action is necessary or desirable
      to
      carry out the purposes of this Agreement, each of the Parties will take such
      further action (including the execution and delivery of such further instruments
      and documents) as any other Party may reasonably request, all at the sole cost
      and expense of the requesting Party (unless the requesting Party is entitled
      to
      indemnification therefor under Section
      12
      below).
      The Seller acknowledges and agrees that from and after the Closing the Purchaser
      will be entitled to possession of all documents, books, records (including
      tax
      records), agreements, and financial data of any sort relating to the
      Company.

     

    (b) Litigation
      Support.
      In the
      event and for so long as any Party actively is contesting or defending against
      any action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      or demand in connection with (i) any transaction contemplated under this
      Agreement or (ii) any fact, situation, circumstance, status, condition,
      activity, practice, plan, occurrence, event, incident, action, failure to act,
      or transaction on or prior to the Closing Date involving the Company, the other
      Party will cooperate with him or it and him or its counsel in the contest or
      defense, make available their personnel, and provide such testimony and access
      to their books and records as shall be necessary in connection with the contest
      or defense, all at the sole cost and expense of the contesting or defending
      Party (unless the contesting or defending Party is entitled to indemnification
      therefor under Section
      12
      below).

     

    11. Conditions
      to Obligation to Close.

     

    (a) Conditions
      to Obligation of the Purchaser.

     

    The
      obligation of the Purchaser to consummate the transactions to be performed
      by
      the Purchaser in connection with the Closing are subject to satisfaction of
      the
      following conditions:

     

    (i) the
      representations and warranties set forth in Sections
      4
      and
5
      above
      shall be true and correct in all material respects at and as of the Closing
      Date;

     

    (ii) the
      Seller shall have performed and complied with all of his covenants hereunder
      in
      all material respects through the Closing;

     

    (iii) the
      Company shall have procured all of the third party consents required in order
      to
      effect the Closing;

     

    (iv) no
      action, suit, or proceeding shall be pending or threatened before any court
      or
      quasi-judicial or administrative agency of any federal, state, local, or foreign
      jurisdiction or before any arbitrator wherein an unfavorable injunction,
      judgment, order, decree, ruling, or charge would (A) prevent consummation of
      any
      of the transactions contemplated by this Agreement, (B) cause any of the
      transactions contemplated by this Agreement to be rescinded following
      consummation, (C) affect adversely the right of the Purchaser to own the Seller
      Shares and to control the Company, or (D) affect adversely the right of the
      Company to own its assets and to operate its businesses (and no such injunction,
      judgment, order, decree, ruling, or charge shall be in effect);

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    (v) the
      Seller shall have delivered to the Purchaser a certificate to the effect that
      (A) each of the conditions specified above in Section
      11(a)(i)-(iv)
      is
      satisfied in all respects, and (B) as of the Closing, the Company has no
      Liabilities; 

     

    (vi) the
      Purchaser shall have received the resignations, effective as of the tenth
      (10th)
      day
      following the filing by the Company of a Schedule 14f-1 information statement
      with the SEC, of each director of the Company and the Purchaser shall have
      received the resignations, effective as of the Closing,
      of each officer
      of the Company.
      The
      designee(s) specified by the
      Purchaser shall have been appointed as officers
      of the
      Company and any designee(s) of the Purchaser who may be lawfully appointed
      to
      the Board of Directors of the Company as of the Company shall have been
      appointed; 

     

    (vii) there
      shall not have been any occurrence, event, incident, action, failure to act,
      or
      transaction since January 1, 2008 which has had or is reasonably likely to
      cause
      a material adverse effect on the business, assets, properties, financial
      condition, results of operations or prospects of the Company;

     

    (viii) the
      Purchaser shall have completed the business, accounting and legal due diligence
      review of the Company, and the results thereof shall be satisfactory to the
      Purchaser;

     

    (ix) the
      Purchaser shall have received such pay-off letters and releases relating to
      Liabilities as they shall have requested and such pay-off letters shall be
      in
      form and substance satisfactory to the Purchaser;

     

    (x) the
      Purchaser shall have conducted UCC, judgment lien and tax lien searches with
      respect to the Company, the results of which indicate no liens on the assets
      of
      the Company;

     

    (xi) the
      Company shall have delivered its Articles of Incorporation and By-Laws, both
      as
      amended to the Closing Date, certified by the Secretary of the Company,
      resolutions adopted by the Board of Directors of the Company authorizing this
      Agreement and the transactions contemplated hereby and the Company shall have
      delivered to the Purchaser the Company’s original minute book and corporate seal
      and all other original corporate documents and agreements;

     

    (xii) the
      Company shall have delivered to the Purchaser a Certificate of Good Standing
      in
      respect of the Company issued by the Secretary of State of the State of Nevada
      dated no earlier than 5 days prior to the Closing;

     

    (xiii) the
      Company shall have maintained at and immediately after the Closing its status
      as
      a company whose Common Stock is quoted on the OTC Bulletin Board;

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    (xiv) all
      actions to be taken by the Seller in connection with consummation of the
      transactions contemplated hereby and all certificates, opinions, instruments,
      and other documents required to effect the transactions contemplated hereby
      will
      be satisfactory in form and substance to the Purchaser, and 

     

    (xv) At
      the
      Closing, other than the Seller Shares, there shall be no more than 951,000
      shares Common Stock of the Company issued and outstanding.

     

    The
      Purchaser may waive any condition specified in this Section
      11(a)
      at or
      prior to the Closing in writing executed by the Purchaser.

    

    (b) Conditions
      to Obligation of the Seller.

     

    The
      obligations of the Seller to consummate the transactions to be performed by
      it
      in connection with the Closing are subject to satisfaction of the following
      conditions:

     

    (i) the
      representations and warranties set forth in Section
      6
      above
      shall be true and correct in all material respects at and as of the Closing
      Date;

     

    (ii) the
      Purchaser shall have performed and complied with all of its covenants hereunder
      in all material respects through the Closing including payment of the Purchase
      Price;

     

    (iii) no
      action, suit, or proceeding shall be pending or threatened before any court
      or
      quasi-judicial or administrative agency of any federal, state, local, or foreign
      jurisdiction or before any arbitrator wherein an unfavorable injunction,
      judgment, order, decree, ruling, or charge would (A) prevent consummation of
      any
      of the transactions contemplated by this Agreement or (B) cause any of the
      transactions contemplated by this Agreement to be rescinded following
      consummation (and no such injunction, judgment, order, decree, ruling, or charge
      shall be in effect);

     

    (iv) the
      Purchaser shall have delivered to the Seller a certificate to the effect that
      each of the conditions specified above in Section
      11(b)(i)-(iii)
      is
      satisfied in all respects; and

     

    (v) all
      actions to be taken by the Purchaser in connection with consummation of the
      transactions contemplated hereby and all certificates, opinions, instruments,
      and other documents required to effect the transactions contemplated hereby
      will
      be satisfactory in form and substance to the Seller.

     

    The
      Seller may waive any condition specified in this Section
      11(b)
      at or
      prior to the Closing in writing executed by the Seller.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    12. Remedies
      for Breaches of This Agreement.

     

    (a) Survival
      of Representations and Warranties.
      All of
      the representations and warranties of the Parties shall survive the Closing
      hereunder (even if a Party knew or had reason to know of any misrepresentation
      or breach of warranty by another Party at the time of Closing) and continue
      in
      full force and effect for a period of twelve (12) months
      thereafter.

     

    (b) Indemnification
      Provisions for Benefit of the Purchaser.

     

    (i) In
      the
      event the Seller breaches (or in the event any third party alleges facts that,
      if true, would mean the Seller has breached) any of its representations,
      warranties, and covenants contained herein, and, if there is an applicable
      survival period pursuant to Section
      12(a)
      above,
      provided that the Purchaser makes a written claim for indemnification against
      the Seller within such survival period, then the Seller shall indemnify the
      Purchaser from and against the entirety of any Adverse Consequences the
      Purchaser may suffer through and after the date of the claim for indemnification
      (including any Adverse Consequences the Purchaser may suffer after the end
      of
      any applicable survival period) resulting from, arising out of, relating to,
      in
      the nature of, or caused by the breach (or the alleged breach). For purposes
      of
      this Agreement, “Adverse
      Consequences”
means
      all actions, suits, proceedings, hearings, investigations, charges, complaints,
      claims, demands, injunctions, judgments, orders, decrees, rulings, damages,
      dues, penalties, fines, costs, amounts paid in settlement, Liabilities,
      obligations, taxes, Liens, losses, lost value, expenses, and fees, including
      court costs and reasonable attorneys’ fees and reasonable expenses not to exceed
      the amount of any such claim.

     

    (ii) The
      Seller shall indemnify the Purchaser from and against the entirety of any
      Adverse Consequences the Purchaser or the Company may suffer resulting from,
      arising out of, relating to, in the nature of, or caused by any Liability of
      the
      Company (whether or not accrued or otherwise disclosed) (x) for any taxes of
      the
      Company with respect to any tax year or portion thereof ending on or before
      the
      Closing Date (or for any Tax year beginning before and ending after the Closing
      Date to the extent allocable to the portion of such period beginning before
      and
      ending on the Closing Date) and (y) for the unpaid taxes of any Person (other
      than the Company) under Section 1.1502-6 of the Regulations adopted under the
      Code (or any similar provision of state, local, or foreign law), as a transferee
      or successor, by contract, or otherwise.

     

    (iii) The
      Seller shall indemnify the Purchaser from and against the entirety of any
      Liabilities arising out of the ownership of the Seller Shares or operation
      of
      the Company prior to the Closing.

     

    (iv) The
      Seller shall indemnify the Purchaser from and against the entirety of any
      Adverse Consequences the Purchaser or the Company may suffer resulting from,
      arising out of, relating to, in the nature of, or caused by any indebtedness
      or
      other Liabilities of the Company existing as of the Closing Date.

     

    (c) Indemnification
      Provisions for Benefit of the Seller.
      In the
      event the Purchaser breaches (or in the event any third party alleges facts
      that, if true, would mean the Purchaser has breached) any of its
      representations, warranties, and covenants contained herein, and, if there
      is an
      applicable survival period pursuant to Section
      12(a)
      above,
      provided that the Seller makes a written claim for indemnification against
      the
      Purchaser within such survival period, then the Purchaser shall indemnify the
      Seller from and against the entirety of any Adverse Consequences the Seller
      may
      suffer through and after the date of the claim for indemnification (including
      any Adverse Consequences the Seller may suffer after the end of any applicable
      survival period) resulting from, arising out of, relating to, in the nature
      of,
      or caused by the breach (or the alleged breach).

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    (d) Matters
      Involving Third Parties.

     

    (i) If
      any
      third party shall notify any Party (the “Indemnified
      Party”)
      with
      respect to any matter (a “Third
      Party Claim”)
      which
      may give rise to a claim for indemnification against any other Party (the
“Indemnifying
      Party”)
      under
      this Section
      12,
      then
      the Indemnified Party shall promptly notify each Indemnifying Party thereof
      in
      writing; provided, however, that no delay on the part of the Indemnified Party
      in notifying any Indemnifying Party shall relieve the Indemnifying Party from
      any obligation hereunder unless (and then solely to the extent) the Indemnifying
      Party thereby is prejudiced.

     

    (ii) Any
      Indemnifying Party will have the right to defend the Indemnified Party against
      the Third Party Claim with counsel of its choice reasonably satisfactory to
      the
      Indemnified Party so long as (A) the Indemnifying Party notifies the Indemnified
      Party in writing within 10 days after the Indemnified Party has given notice
      of
      the Third Party Claim that the Indemnifying Party will indemnify the Indemnified
      Party from and against the entirety of any Adverse Consequences the Indemnified
      Party may suffer resulting from, arising out of, relating to, in the nature
      of,
      or caused by the Third Party Claim, (B) the Indemnifying Party provides the
      Indemnified Party with evidence reasonably acceptable to the Indemnified Party
      that the Indemnifying Party will have the financial resources to defend against
      the Third Party Claim and fulfill its indemnification obligations hereunder,
      (C)
      the Third Party Claim involves only money damages and does not seek an
      injunction or other equitable relief, (D) settlement of, or an adverse judgment
      with respect to, the Third Party Claim is not, in the good faith judgment of
      the
      Indemnified Party, likely to establish a precedential custom or practice adverse
      to the continuing business interests of the Indemnified Party, and (E) the
      Indemnifying Party conducts the defense of the Third Party Claim actively and
      diligently.

     

    (iii) So
      long
      as the Indemnifying Party is conducting the defense of the Third Party Claim
      in
      accordance with Section
      12(d)(ii)
      above,
      (A) the Indemnified Party may retain separate co-counsel at its sole cost and
      expense and participate in the defense of the Third Party Claim, (B) the
      Indemnified Party will not consent to the entry of any judgment or enter into
      any settlement with respect to the Third Party Claim without the prior written
      consent of the Indemnifying Party (not to be withheld unreasonably), and (C)
      the
      Indemnifying Party will not consent to the entry of any judgment or enter into
      any settlement with respect to the Third Party Claim without the prior written
      consent of the Indemnified Party (not to be withheld unreasonably).

     

    (iv) In
      the
      event any of the conditions in Section
      12(d)(ii)
      above is
      or becomes unsatisfied, however, (A) the Indemnified Party may defend against,
      and consent to the entry of any judgment or enter into any settlement with
      respect to, the Third Party Claim in any manner it reasonably may deem
      appropriate (and the Indemnified Party need not consult with, or obtain any
      consent from, any Indemnifying Party in connection therewith), (B) the
      Indemnifying Parties will reimburse the Indemnified Party promptly and
      periodically for the costs of defending against the Third Party Claim (including
      attorneys’ fees and expenses), and (C) the Indemnifying Parties will remain
      responsible for any Adverse Consequences the Indemnified Party may suffer
      resulting from, arising out of, relating to, in the nature of, or caused by
      the
      Third Party Claim to the fullest extent provided in this Section
      12.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

    (v) Other
      Indemnification Provisions.
      The
      Seller hereby indemnifies the Company against any and all claims that may be
      filed by a current or former officer, director or employee of the Seller by
      reason of the fact that such person was a director, officer, employee, or agent
      of the Company or was serving the Company at the request of the Seller or the
      Company as a partner, trustee, director, officer, employee, or agent of another
      entity, whether such claim is for accrued salary, compensation, indemnification,
      judgments, damages, penalties, fines, costs, amounts paid in settlement, losses,
      expenses, or otherwise and whether such claim is pursuant to any statute,
      charter document, bylaw, agreement, or otherwise) with respect to any action,
      suit, proceeding, complaint, claim, or demand brought against the Company
      (whether such action, suit, proceeding, complaint, claim, or demand is pursuant
      to an agreement, applicable law, or otherwise).

     

    (d) Limitation
      on Indemnification.
      Notwithstanding any other provision of this Section 12, the aggregate
      indemnification to be paid by a Party hereunder with respect to breaches of
      representations and warranties hereunder shall not exceed the Purchase Price.
      

    

    13. Termination.

     

    (a) Termination
      of Agreement.
      The
      Parties may terminate this Agreement as provided below: 

     

    (i) the
      Purchaser and the Seller may terminate this Agreement by mutual written
      agreement at any time prior to the Closing; 

     

    (ii) the
      Purchaser may terminate this Agreement by giving written notice to the Seller
      at
      any time prior to the Closing Date (A) pursuant to Section
      7,
      (B)
      if
      the
      aggregate of the Liabilities exceeds $0; (C)
      in
      the
      event the Seller has breached any material representation, warranty, or covenant
      contained in this Agreement in any material respect and the Purchaser has
      notified the Seller of the breach, and the breach has continued without cure
      for
      a period of two (2) days after the notice of breach; (D)
      if the
      Closing shall not have occurred in accordance with Section
      3(a),
      by
      reason of the failure of any condition precedent under Section
      11(a)
      (unless
      the failure results primarily from the Purchaser breaching any representation,
      warranty, or covenant contained in this Agreement); and

     

    (iii) the
      Seller may terminate this Agreement by giving written notice to the Purchaser
      at
      any time prior to the Closing Date (A) in the event the Purchaser has breached
      any material representation, warranty, or covenant contained in this Agreement
      in any material respect, the Seller has notified the Purchaser of the breach,
      and the breach has continued without cure for a period of two (2) days after
      the
      notice of breach or (B) if the Closing shall not have occurred in accordance
      with Section
      3(a),
      by
      reason of the failure of any condition precedent under Section
      11(b)
      (unless
      the failure results primarily from the Seller breaching any representation,
      warranty, or covenant contained in this Agreement).

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

    (b) Effect
      of Termination.
      The
      Seller shall in no event be permitted to terminate this Agreement pursuant
      to
Section
      13(a)(iii)
      and
      allowed to retain the Cash Deposit or be released from his obligation sell
      the
      Seller Shares to the Purchaser unless prior to or accompanying any notice of
      termination delivered hereunder, the Seller have notified the Law Firm in
      writing that the Escrow Deposit may released to the Purchaser. If the Purchaser
      terminates this Agreement pursuant to any of Sections
      13(a)(ii)(B) - (D),
      then
      the Seller shall immediately pay to the Purchaser any portion of the Purchase
      Price theretofore paid by the Purchaser and the Seller shall immediately notify
      the Law Firm in writing that any amounts held in escrow by it may released
      to
      the Purchaser. Except as aforesaid, if this Agreement terminates pursuant to
      this Section
      13,
      all
      rights and obligations of the Parties hereunder shall terminate without
      any Liability of any Party to any other Party, except for any Liability of
      a
      Party that is then in breach.

     

    (c) Termination
      for Cause.
      In the
      event that the transaction would have closed but for the failure of the Seller
      to close, then the Seller shall reimburse the Purchaser for its documented
      reasonable legal fees and related out-of-pocket expenses the Purchaser has
      incurred in connection with the transaction in an amount not to exceed a maximum
      of $50,000. The Purchaser agrees that any damages payable on account of any
      breach of this Agreement shall be expressly limited to such amount. In the
      event
      that the transaction would have closed but for the failure of the Purchaser
      to
      close, then the Seller shall retain the Cash Deposit as liquidated damages
      regardless of his actual damages to the extent permitted under California
      law.

     

    14. Miscellaneous.

     

    (a) Facsimile
      Execution and Delivery.
      Facsimile execution and delivery of this Agreement is legal, valid and binding
      execution and delivery for all purposes.

     

    (b) Confidentiality;
      Press Releases and Public Announcements.
      Except
      as and to the extent required by law, no Party will disclose or use and will
      direct its representatives not to disclose or use any information with respect
      to the transaction which is the subject to this Agreement, without the consent
      of the other Parties. Neither the Seller nor the Company shall issue any press
      release or make any public announcement relating to the subject matter of this
      Agreement without the prior written approval of the Purchaser; provided,
      however, that the Company may make any public disclosure it believes in good
      faith is required by applicable law or any listing or trading agreement
      concerning its publicly-traded securities(in which case the Seller and the
      Company will use their best efforts to advise the other Parties prior to making
      the disclosure).

     

    (c) No
      Third-Party Beneficiaries.
      This
      Agreement shall not confer any rights or remedies upon any person other than
      the
      Parties and their respective successors and permitted assigns.

     

    (d) Entire
      Agreement.
      This
      Agreement (including the documents referred to herein) constitutes the entire
      agreement among the Parties and supersedes any prior understandings, agreements,
      or representations by or among the Parties, written or oral, to the extent
      they
      related in any way to the subject matter hereof.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

       

    

    (e) Succession
      and Assignment.
      This
      Agreement shall be binding upon and inure to the benefit of the Parties named
      herein and their respective successors and permitted assigns. No Party may
      assign either this Agreement or any of their rights, interests, or obligations
      hereunder without the prior written approval of the Purchaser and the Seller,
      as
      applicable; provided, however, that the Purchaser may (i) assign any or all
      of
      its rights and interests hereunder to one or more of its Affiliates, and (ii)
      designate one or more of its Affiliates to perform its obligations hereunder,
      but no such assignment shall operate to release the Purchaser or a successor
      from any obligation hereunder unless and only to the extent that the Seller
      agrees in writing.

     

    (f) Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which shall be
      deemed an original but all of which together will constitute the same
      instrument.

     

    (g) Headings.
      The
      Section headings contained in this Agreement are inserted for convenience only
      and shall not affect in any way the meaning or interpretation of this
      Agreement.

     

    (h) Notices.
      All
      notices, requests, demands, claims, and other communications hereunder will
      be
      in writing. Any notice, request, demand, claim, or other communication hereunder
      shall be deemed duly given if (and then two business days after) it is sent
      by
      registered or certified mail, return receipt requested, postage prepaid, and
      addressed to the intended recipient as set forth below:

     

    If
      to the
      Seller (or the Company prior to the Closing):

     

    Henry
      C.
      Casden, Esq.

    Law
      Offices of Henry C. Casden

    El
      Paseo
      Professional Plaza

    74090
      El
      Paseo, Suite 205

    Palm
      Desert, California 92260

    Tel:
      (760) 568-5699

    Fax:
      (760) 341-3635 or (760) 406-5799

     

    If
      to the
      Purchaser:

     

    c/o
      Robert L. B. Diener, Esq.

    122
      Ocean
      Park Blvd.

    Suite
      307

    Santa
      Monica, CA 90405

    Tel:
      (310) 396-1691

    Fax:
      (310) 362-8887

    

    Any
      Party
      may send any notice, request, demand, claim, or other communication hereunder
      to
      the intended recipient at the address set forth above using any other means
      (including personal delivery, expedited courier, messenger service, telecopy,
      telex, ordinary mail, or electronic mail), but no such notice, request, demand,
      claim, or other communication shall be deemed to have been duly given unless
      and
      until it actually is received by the intended recipient. Any Party may change
      the address to which notices, requests, demands, claims, and other
      communications hereunder are to be delivered by giving the other Parties notice
      in the manner herein set forth.

    

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

       

    

    (i) Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the domestic
      laws of the State of California
      without
      giving effect to any choice or conflict of law provision or rule (whether of
      the
      State of California
      or any
      other jurisdiction) that would cause the application of the laws of any
      jurisdiction other than the State of California.

     

    (j) Amendments
      and Waivers.
      No
      amendment of any provision of this Agreement shall be valid unless the same
      shall be in writing and signed by the Purchaser and the Seller or their
      respective representatives. No waiver by any Party of any default,
      misrepresentation, or breach of warranty or covenant hereunder, whether
      intentional or not, shall be deemed to extend to any prior or subsequent
      default, misrepresentation, or breach of warranty or covenant hereunder or
      affect in any way any rights arising by virtue of any prior or subsequent such
      occurrence.

     

    (k) Severability.
      Any
      term or provision of this Agreement that is invalid or unenforceable in any
      situation in any jurisdiction shall not affect the validity or enforceability
      of
      the remaining terms and provisions hereof or the validity or enforceability
      of
      the offending term or provision in any other situation or in any other
      jurisdiction.

     

    (l) Expenses.
      Each of
      the Parties and the Company will bear their own costs and expenses (including
      legal fees and expenses) incurred in connection with this Agreement and the
      transactions contemplated hereby. The Seller agrees that the Company has not
      borne or will not bear any of the Seller’s costs and expenses (including any of
      his legal fees and expenses) in connection with this Agreement or any of the
      transactions contemplated hereby. At its option, the Purchaser may treat its
      costs and expenses incurred in connection with this transaction as advances
      to
      the Company, with such costs and expenses being paid by the Company, for which
      the Company will issue a promissory note to the Purchaser in the amount of
      such
      advances at the Closing. Such advances shall not be deemed a Liability of the
      Company, as defined in this Agreement.

     

    (m) Construction.
      The
      Parties have participated jointly in the negotiation and drafting of this
      Agreement. In the event an ambiguity or question of intent or interpretation
      arises, this Agreement shall be construed as if drafted jointly by the Parties
      and no presumption or burden of proof shall arise favoring or disfavoring any
      Party by virtue of the authorship of any of the provisions of this Agreement.
      Any reference to any federal, state or local statute or law shall be deemed
      also
      to refer to all rules and regulations promulgated thereunder, unless the context
      requires otherwise. The word “including”
shall
      mean including without limitation. The Parties intend that each representation,
      warranty, and covenant contained herein shall have independent significance.
      If
      any Party has breached any representation, warranty, or covenant contained
      herein in any respect, the fact that there exists another representation,
      warranty, or covenant relating to the same subject matter (regardless of the
      relative levels of specificity) which the Party has not breached shall not
      detract from or mitigate the fact that the Party is in breach of the first
      representation, warranty, or covenant. Nothing in the disclosure Schedules
      attached hereto shall be deemed adequate to disclose an exception to a
      representation or warranty made herein, unless the disclosure Schedules
      identifies the exception with particularity and describes the relevant facts
      in
      detail. Without limiting the generality of the foregoing, the mere listing
      (or
      inclusion of a copy) of a document or other item in the disclosure Schedules
      or
      supplied in connection with the Purchaser due diligence review, shall not be
      deemed adequate to disclose an exception to a representation or warranty made
      herein (unless the representation or warranty has to do with the existence
      of
      the document or other item itself).

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

    (n) Incorporation
      of Exhibits and Schedules.
      The
      Exhibits and Schedules identified in this Agreement are incorporated herein
      by
      reference and made a part hereof.

     

    (o) Specific
      Performance.
      Each of
      the Parties acknowledges and agrees that the other Parties would be damaged
      irreparably in the event any of the provisions of this Agreement are not
      performed in accordance with their specific terms or otherwise are breached.
      Accordingly, each of the Parties agrees that the other Parties shall be entitled
      to an injunction or injunctions to prevent breaches of the provisions of this
      Agreement and to enforce specifically this Agreement and the terms and
      provisions hereof in any action instituted in any court of the United States
      or
      any state thereof having jurisdiction over the Parties and the matter (subject
      to the provisions set forth in Section
      14(p)
      below),
      in addition to any other remedy to which they may be entitled, at law or in
      equity.

     

    (p) Submission
      to Jurisdiction.
      Each of
      the Parties submits to the jurisdiction of any state or federal court sitting
      in
      Los Angeles County, California, in any action or proceeding arising out of
      or
      relating to this Agreement and agrees that all claims in respect of the action
      or proceeding may be heard and determined in any such court. Each of the Parties
      waives any defense of inconvenient forum to the maintenance of any action or
      proceeding so brought and waives any bond, surety, or other security that might
      be required of any other Party with respect thereto. Any Party may make service
      on any other Party by sending or delivering a copy of the process to the Party
      to be served at the address and in the manner provided for the giving of notices
      in Section
      14(h)
      above.
      Nothing in this Section
      14(p),
      however, shall affect the right of any Party to bring any action or proceeding
      arising out of or relating to this Agreement in any other court or to serve
      legal process in any other manner permitted by law or at equity. Each Party
      agrees that a final judgment in any action or proceeding so brought shall be
      conclusive and may be enforced by suit on the judgment or in any other manner
      provided by law or at equity.

     

    [signature
      pages follow]

    
      
        
        

        
        

      

      
        19

        
          

        

      

      
        
        

        
          

        

      

    

    The
      Seller Signature Page

    

    IN
      WITNESS WHEREOF, the undersigned the
      Seller has
      duly
      executed this Agreement the date first above written.

     

    
      	 	 	/s/
              Henry C. Casden 
	 	
              
Henry
              C. Casden

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    Purchaser
      Signature Page

    

    IN
      WITNESS WHEREOF, the undersigned Purchaser
      has
      duly
      executed this Agreement the date first above written.

    

    
      	 	 	 
	 	FOUNTAINHEAD
              CAPITAL MANAGEMENT LIMITED:
	 
 	 
 	 
 
	 	By:  	
              /s/
                Robert L.B. Diener

            
	 	
              

              Name:
                Robert L.B.Diener, Esq.

              
                Title:
                  Attorney-in-fact

              

            

    

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    Company
      Signature Page

    

    IN
      WITNESS WHEREOF, the Company
      has duly
      executed this Agreement the date first above written.

     

    
      	 	 	 
	 	CYBERSPACE
              VITA, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Henry C. Casden  
	 	
              

              Name:
                Henry C. Casden

              Title:
                President

            

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    Signature
      Page for Principal Executive Officer of the Company

    

    IN
      WITNESS WHEREOF, the undersigned being the Principal
      Executive Officer
      of
      the Company
      has duly executed this Agreement as of the date first above
      written.

     

    
      	 	 	 
	 	PRINCIPAL
              EXECUTIVE OFFICER:
	 	 
/s/
              Henry C. Casden  
	 	Name:
              Henry C. Casden
              Executing
                this Agreement in his individual 

              capacity
                in order to induce the Purchaser 

              to
                enter into this
                Agreement

            

    

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      A

    A.
      Seller Shares

    

    
      	
              Date
                of Acquisition of Seller Shares

            	 	
              Number
                of Seller Shares

            	 
	 	 	 	 
	
              11/7/2006
                (issued on October 1, 2007)

            	 	
              4,000,000

            	 

    

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    
      	
              NAME
                OF PURCHASER

            	
              PERCENTAGE

            
	 	 
	
              Fountainhead
                Capital Management Limited

            	
              100%

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    ESCROW
      AGREEMENT

    

    ESCROW
      AGREEMENT, dated as of April 15, 2008 (“Agreement”),
      among
      Thelen Reid Brown Raysman & Steiner LLP (the “Escrow
      Agent”),
      Henry
      C. Casden (the “Seller”),
      and
      the entity listed on Schedule
      I
      (the
“Purchaser”).
      The
      Escrow Agent, the Seller and the Purchaser are sometimes individually referred
      to herein as a “Party”
and
      collectively, as the “Parties”.
      

    

    BACKGROUND

    

    The
      Seller, Purchaser and Cyberspace Vita, Inc. (the “Company”)
      have
      entered into that certain Purchase Agreement dated as of April 15, 2008 but
      effective as of the Closing Date (the “Purchase
      Agreement”),
      pursuant to which the Purchaser has agreed to purchase from the Seller and
      the
      Seller has agreed to sell 4,000,000 shares of the Company’s common stock (the
“Shares”)
      representing all the shares owned by the Seller and which represents
      approximately 80.8% of the issued and outstanding stock of the Company for
      a
      cash consideration in the aggregate amount of $400,000.00 (the “Purchase
      Price”).
      Defined terms used herein and which are not otherwise defined in this Agreement
      are defined in the Purchase Agreement.

    

    In
      accordance with the terms and subject to the conditions of the Purchase
      Agreement and to induce the consummation of the transactions contemplated
      thereby, the Parties agree to deliver the following to the Escrow Agent on
      April
      30, 2008: (i) the Purchaser shall deposit the
      Escrow Deposit and the Broker Payments by wire transfer to Escrow Agent and
      (ii)
      the Seller shall deliver the Certificates to the Escrow Agent. The Escrow
      Deposit together with the Broker Payments and Certificates are hereinafter
      referred to as the “Escrow
      Deposits”.
      This
      Agreement governs the maintenance and release of the Escrow Deposits from
      escrow.

    

    NOW,
      THEREFORE, the Parties hereto, intending to be legally bound, hereby agree
      as
      follows:

    

    AGREEMENT

     

    1. Appointment
      of Escrow Agent.

     

    The
      Seller and the Purchaser hereby appoint the Escrow Agent as escrow agent and
      the
      Escrow Agent accepts that appointment and agrees to hold and dispose of the
      Escrow Deposits in accordance with the terms of this Agreement. Escrow Agent
      acknowledges receipt of fair and reasonable consideration for its
      services.

     

    2. Release
      of the Escrow Deposits.

     

    (a) If
      any of
      the following occur, then the Escrow Agent shall promptly (and in any event
      within five (5) business days) release the Escrow Deposits and the Broker
      Payment to the Purchaser and the Certificates to the Seller:

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

       

    

    (i) The
      Purchaser notifies the Escrow Agent in writing prior to the Closing that an
      event as described in Section
      13(a)(ii)
      of the
      Purchase Agreement has occurred which in the Purchaser’s sole opinion cannot be
      resolved to the satisfaction of the Purchaser;

     

    (ii) The
      Seller notifies the Escrow Agent in writing prior to the Closing that an event
      as described in Section
      13(a)(iii)
      of the
      Purchase Agreement has occurred which in the Seller’s sole opinion cannot be
      resolved to the satisfaction of the Seller;

     

    (iii) The
      Parties fail to execute a Purchase Agreement on or prior to the date of
      execution of this Agreement; 

     

    (iv) A
      Closing
      fails to occur by the close of business on the Closing Date, as defined in
      the
      Purchase Agreement;

     

    (v) Prior
      to
      the Closing, the Company fails in a timely manner to file any reports required
      to be filed with the U.S. Securities and Exchange Commission;

     

    (b) If
      all of
      the conditions of the Purchaser and Seller to the Closing that are specified
      in
      the Purchase Agreement (except those that have been waived by the parties)
      occur
      and the Purchaser pays the Purchase Price in accordance with the Purchase
      Agreement, then the Escrow Agent shall promptly (and in any event within five
      (5) business days) release (i) the Escrow Deposit less any Liabilities by wire
      transfer to the Seller, (ii) the Certificates to the Purchaser in accordance
      with the terms of the Purchase Agreement, (iii) the Broker Payments as set
      forth
      in the Purchase Agreement and (iv) if applicable, any payment of Liabilities
      as
      set forth in Purchase Agreement.

     

    (c) Notwithstanding
      any other provision of this Agreement, if at any time Escrow Agent shall receive
      from the Purchaser and the Seller (prior to being directed to take action by
      a
      court) joint written instructions as to the delivery of the Escrow Deposits,
      Escrow Agent shall deliver the Escrow Deposits in accordance with such joint
      written instructions.

     

    (d) The
      Escrow Agent may at any time commence an action in the nature of interpleader
      or
      other legal proceedings and may deposit the Escrow Deposits with the clerk
      of
      the court. In the event of any dispute regarding who is entitled to the Escrow
      Deposits at any time, the Escrow Agent shall not release the Escrow Deposits
      to
      either the Purchaser or the Seller and may commence an interpleader action
      as
      aforesaid or may cause the Purchase Price to be paid to and the Certificates
      deposited with a court of competent jurisdiction whereupon it shall cease to
      have any further obligation hereunder.

     

    (e) Upon
      any
      delivery or deposit of the Escrow Deposits as provided in this Section 2, the
      Escrow Agent shall be released and discharged from any further obligation under
      this Agreement.

     

    3. Concerning
      the Escrow Agent.

     

    (a) The
      Escrow Agent shall not have any liability to any of the parties to this
      Agreement or to any third party arising out of its services as Escrow Agent
      under this Agreement, except for damages directly resulting from the Escrow
      Agent's gross negligence or willful misconduct. 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

       

    

    (b) The
      Purchaser and the Seller shall jointly and severally indemnify the Escrow Agent
      and hold it harmless against any loss, liability, damage or expense (including
      reasonable attorneys' fees) that the Escrow Agent may incur as a result of
      acting as escrow agent under this Agreement, except for any loss, liability,
      damage or expense arising from its own gross negligence or willful misconduct.
      As between the Purchaser and the Seller, such obligations shall be borne equally
      by the Purchaser and the Seller. For this purpose, the term "attorneys' fees"
      includes fees payable to any counsel retained by the Escrow Agent in connection
      with its services under this Agreement and, with respect to any matter arising
      under this Agreement as to which the Escrow Agent performs legal services,
      its
      standard hourly rates and charges then in effect.

     

    (c) The
      Escrow Agent shall be entitled to rely upon any judgment, notice, instrument
      or
      other writing delivered to it under this Agreement without being required to
      determine the authenticity of, or the correctness of any fact stated in, that
      document and irrespective of any facts the Escrow Agent may know or be deemed
      to
      know in any other capacity. The Escrow Agent may act in reliance upon any
      instrument or signature believed by it to be genuine and may assume that any
      person purporting to give any notice or receipt or advice or make any statement
      or execute any document in connection with this Agreement has been duly
      authorized to do so.

     

    (d) The
      Escrow Agent shall have no duties or responsibilities except those expressly
      set
      forth in this Agreement. The Escrow Agent shall not have any obligations arising
      out of or be bound by the provisions of any other agreement, written or oral,
      including, but not limited to, the Purchase Agreement.

     

    (e) The
      Seller acknowledges that it knows that the Escrow Agent has represented the
      Purchaser in connection with the Purchase Agreement and this Agreement and
      that
      it may continue to represent Purchaser in that connection and in connection
      with
      the transactions contemplated by those agreements, including, but not limited
      to, in connection with any disputes that may arise under either of those
      agreements. The Escrow Agent shall not be precluded from or restricted from
      representing the Purchaser or any of its respective affiliates or otherwise
      acting as attorneys for the Purchaser or any of its affiliates in any matter,
      including, but not limited to, any court proceeding or other matter related
      to
      the Purchase Agreement, this Agreement or the transactions contemplated by
      the
      Purchase Agreement or this Agreement or the Escrow Deposit, whether or not
      there
      is a dispute between Purchaser and Seller with respect to any such matter;
      The
      Seller irrevocably consents to any such representation and waives any conflict
      or appearance of conflict with respect to any such representation.

     

    (f) All
      of
      the Escrow Agent's rights of indemnification provided for in this Agreement
      shall survive the resignation of the Escrow Agent, its replacement by a
      successor Escrow Agent, its delivery or deposit of the Escrow Deposit in
      accordance with this Agreement, the termination of this Agreement, and any
      other
      event that occurs after this date.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

       

    

    (g) The
      Escrow Agent shall have no responsibility with respect to the sufficiency of
      the
      arrangements contemplated by this Agreement to accomplish the intentions of
      the
      Parties.

     

    4. Representations.

     

    The
      Purchaser and the Seller represent and warrant to the Escrow Agent that each
      of
      them has full power and authority to enter into and perform this Agreement;
      that
      this Agreement was duly authorized by all necessary corporate or other action,
      to the extent applicable; and that this Agreement is enforceable against each
      of
      them in accordance with its terms. 

    

    5. Resignation;
      Successor Escrow Agent.

     

    The
      Escrow Agent (and any successor escrow agent) may at any time resign as such
      upon 30 days prior notice to each of the other Parties. Upon receipt of a notice
      of resignation, each of the other Parties shall use their best efforts to select
      a successor agent within 15 days, but if within such 15 day period the Escrow
      Agent has not received a notice signed by the Parties appointing a successor
      escrow agent and setting forth its name and address, the Escrow Agent may (but
      shall not be obligated to) select on their behalf a bank or trust company to
      act
      as successor escrow agent, for such compensation as that bank or trust company
      customarily charges and on such terms and conditions not inconsistent with
      this
      Agreement as that bank or trust company reasonably requires. The fees and
      charges of any successor escrow agent shall be payable out of the Escrow
      Deposits. A successor escrow agent selected by the resigning Escrow Agent may
      become the Escrow Agent by confirming in writing its acceptance of the position.
      Purchaser and Seller shall sign such other documents as the successor escrow
      agent reasonably requests in connection with its appointment.

    

    6. Notices.

     

    All
      notices, instructions, objections or other communications under this Agreement
      shall be in writing and shall be deemed given when sent by United States
      registered mail, return receipt requested, to the respective Parties at the
      following addresses (or at such other address as a party may specify by notice
      given in accordance with this paragraph):

    

    If
      to
      Purchaser:

    

    c/o
      Robert
      L.
      B. Diener, Esq.

    122
      Ocean
      Park Blvd.

    Suite
      307

    Santa
      Monica, CA 90405

    Tel
      (310)
      396-1691

    Fax
      (310)
      362-8887

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

       

    

    If
      to
      the Seller:

     

    Henry
      C.
      Casden, Esq. 

    Law
      Offices of Henry C. Casden

    Tel:
       El
      Paseo
      Professional Plaza

    74090
      El
      Paseo, Suite 205

    Palm
      Desert, California 92260

    Tel:
      (760) 568-5699

    Fax:
      (760) 341-3635 or (760) 406-5799

    

    If
      to
      the Escrow Agent:

    

    Thelen
      Reid Brown Raysman & Steiner LLP

    701
      Eighth Street, NW

    Washington,
      DC 20001

    Tel:
      (202) 508-4281

    Fax:
      (202) 654-1804

    Attn:
      Louis A. Bevilacqua, Esq.

    

    7. Miscellaneous.

     

    (a) The
      Escrow Agent shall serve under this Agreement without fee, but the Purchaser
      and
      the Seller shall jointly and severally pay to the Escrow Agent on demand, out
      of
      the Escrow Deposit or otherwise, all costs and expenses, including, without
      limitation, the costs of any interpleader or similar action, incurred by the
      Escrow Agent in performing its services under this Agreement.
      As
      between the Purchaser and the Seller, such obligations shall be borne equally
      by
      the Purchaser and the Seller.

     

    (b) If
      any
      provision of this Agreement is determined by any court of competent jurisdiction
      to be invalid or unenforceable in any jurisdiction the remaining provisions
      of
      this Agreement shall not be affected thereby, and the invalidity or
      unenforceability in any jurisdiction shall not invalidate or render
      unenforceable that provision in any other jurisdiction. It is understood,
      however, that the Parties intend each provision of this Agreement to be valid
      and enforceable and each of them waives all rights to object to any provision
      of
      this Agreement.

     

    (c) This
      Agreement shall be binding upon and inure solely to the benefit of the Parties
      and their respective successors and permitted assigns, and shall not be
      enforceable by or inure to the benefit of any third party. No Party may assign
      its rights or obligations under this Agreement or any interest in the Escrow
      Deposit without the written consent of the other parties unless otherwise
      specified herein, and any other purported assignment shall be void. In no event
      shall the Escrow Agent be required to act upon, or be bound by, any notice,
      instruction, objection or other communication given by a person other than,
      nor
      shall the Escrow Agent be required to deliver the Escrow Deposits to any person
      other than, the Purchaser or the Seller.

     

    (d) This
      Agreement shall be governed by and construed in accordance with the law of
      the
      State of California applicable to agreements made and to be performed in
      California.

     

    (e) The
      courts of State of California and the United States District Courts for State
      of
      California shall have exclusive jurisdiction over the Parties (and the subject
      matter) with respect to any dispute or controversy arising under or in
      connection with this Agreement. A summons or complaint or other process in
      any
      such action or proceeding served by mail in accordance with Section 6 of this
      Agreement or in such other manner as may be permitted by law shall be valid
      and
      sufficient service.

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

       

    

    (f) This
      Agreement contains a complete statement of all of the arrangements among the
      Parties with respect to its subject matter and cannot be changed or terminated
      orally. Any waiver must be in writing.

     

    (g) This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      deemed to be an original and all of which taken together shall constitute one
      and the same instrument. Facsimile execution and delivery of this Agreement
      is
      legal, valid and binding for all purposes.

     

    (h) The
      section headings used herein are for convenience of reference only and shall
      not
      affect the construction or interpretation of this Agreement.

     

    SIGNATURES
      ON THE FOLLOWING PAGE

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

    

    The
      Seller Signature Page

    

    IN
      WITNESS WHEREOF, the undersigned the
      Seller has
      duly
      executed this Agreement the date first above written.

     

    
      	 	 	/s/
              Henry C. Casden   
	 	
              
Henry
              C. Casden

    

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    

    Purchaser
      Signature Page

    

    IN
      WITNESS WHEREOF, the undersigned Purchaser
      has
      duly
      executed this Agreement the date first above written.

     

    
      	 	 	 
	 	FOUNTAINHEAD
              CAPITAL MANAGEMENT LIMITED
	 
 	 
 	 
 
	 	By:  	
              /s/
                Robert L.B. Diener 

            
	 	
              

              Name:
                Robert L.B.Diener, Esq.

              
                Title:
                  Attorney-in-fact

              

            

    

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

    
Escrow
      Agent Signature Page

    

    IN
      WITNESS WHEREOF, the undersigned has duly executed this Agreement the date
      first
      above written. 

    

    
      	 	 	 
	 	
              ESCROW
                AGENT:

               

              THELEN
                REID BROWN RAYSMAN & STEINER LLP 

            
	 
 	 
 	 
 
	 	By:  	/s/ Louis A.
              Bevilacqua
	 	
              
For
              Louis A. Bevilacqua, Esq.

    
      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

    

     

    SCHEDULE
      I

    

    
      	
              NAME
                OF PURCHASER

            	
              PERCENTAGE

            
	 	 
	
              Fountainhead
                Capital Management Limited

            	
              100%

            

    

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    DISCLOSURE
      SCHEDULES

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

    Schedule
      5(m)

    Adverse
      Changes

    

    None.

     

    
      
        
        

      

      
        37

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