Document:

Exhibit 10.1

 

 

 

 

 

 

 

 

 

 

                                                                                                                                              

	 
	 
	SHARE PURCHASE AGREEMENT
	 
	
        by and between

         

        JOHN PENA

        JP09 & Associates, Inc. 

	 
	 
	 
	And
	 
	WIKIFAMILIES, INC.
	 
	Dated as of May 8, 2013
	 
	 

 

 

 

 

 

 

 

 

 

 

 

    	 

    	 

    

  

SHARE PURCHASE AGREEMENT

 

THIS SHARE PURCHASE AGREEMENT is made and entered into as
of the May 8, 2013 (this "Agreement"), by and among JOHN PENA, an individual, and JP09 &
Associates, Inc., a California corporation, as owner ("Seller"), and Wikifamilies, Inc. (aka
ClairNET, Ltd.), a Nevada corporation ("Purchaser").

 

RECITALS

 

WHEREAS, as of the date of this Agreement,
Seller is the owner of 100% of the issued and outstanding capital stock of RC One, Inc., a Nevada corporation (the “Company”),
which owns the assets of the MMA business as set forth on Schedule A hereto (“Company Assets”), and includes, but is
not limited to, Respect in the Cage, www.respectinthecage.com, the MMA promotions business, the MMA merchandise business and all
concessions for the MMA events business; and

 

WHEREAS, Purchaser is a publicly held company
whose common stock trades on the over the counter bulletin board; and

 

WHEREAS, pursuant to a Loan and Security Agreement
by and between Seller and Purchaser, dated July 15, 2010, Seller owes Purchaser $155,000 in principal amount, $42,763.01 in interest
and $9,888.15 in late fees, for a total of $207,651.16 (the “Prior Note”); and

 

WHEREAS, Seller desires to sell and to transfer
to Purchaser, and Purchaser desires to purchase and accept from Seller, Shares representing 60% of the issued and outstanding capital
stock of the Company (the "Transferred Shares"), upon the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing,
the representations, warranties, covenants and agreements set forth in this Agreement, and other good and valuable consideration,
the adequacy and receipt of which are hereby acknowledged, the parties hereby agree as follows:

 

Article
I

DEFINITIONS

 

Section
1.1            Definitions.
The following terms, when used in this Agreement, shall have the meanings assigned to them in this Section 1.1.

 

"Affiliate" means a Person
that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with,
a specified Person. For the purposes of this definition, "control" means the ownership, directly or indirectly, of more
than 50% of the voting shares or other voting equity interest of the relevant person, provided that a Person shall be deemed to
control another Person if such first Person possesses, directly or indirectly, the power to direct, or cause the direction of,
the management and policies of such other Person, whether through the ownership of voting securities, by contract or otherwise.

 

"Agreement" shall have the
meaning set forth in the first paragraph of this Agreement.

 

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"Assets" shall mean all of
the assets of the Company, including but not limited to all intellectual property which shall include all computer source code
for its back office operations.

 

"Benefit Plans" shall mean
all benefit plans of the Company in effect on the date of this Agreement.

 

"Cash" means unencumbered and unrestricted
cash on hand in banks, cash equivalents, and the accounts in which such items are deposited and held.

 

"Company" shall have the
meaning set forth in the recitals to this Agreement.

 

"Confidential Information"
means information with respect to the terms of the transactions contemplated by this Agreement, and trade secrets, discoveries,
ideas, concepts, know-how, techniques, designs, specifications, data, computer programs, pricing information, interpretations,
financial statements, forecasts, reports, records, plans, studies, information regarding potential acquisitions or the target companies
or assets, and other technical and business information of the disclosing party, and any company in which the disclosing party
is contemplating an investment, joint venture, acquisition or business combination, whether in oral, written, graphic, electronic
or other form as well as analyses, compilations, studies or other documents, whether or not prepared by the receiving party or
its representatives, which contain or otherwise reflect such information. Notwithstanding the foregoing, the following information
shall not be Confidential Information: information which has become generally available to the general public or industry other
than as a result of a disclosure by the receiving party or its representatives.

 

"Confidentiality Agreement"
means that certain Mutual Non-Disclosure Agreement between Purchaser and Seller dated as of May 7, 2013.

 

"Effective Time" means 11:59
p.m., New York City time, on the Closing Date.

 

"Encumbrance" means any lien,
encumbrance, security interest, option right, adverse ownership interest, pledge, mortgage or similar third party rights or restrictions
on transfer of title, except for any Encumbrances relating to limitations on the transfer or ownership of the Transferred Shares
arising under applicable Laws, including securities Laws.

 

"GAAP" means generally accepted
accounting principles in the United States as in effect from time to time.

 

"Governmental Entity" means
any governmental or quasi-governmental, national, federal, state, municipal, local or multinational (including the European Union),
judicial, court, legislative, regulatory or administrative authority, agency, bureau, department, tribunal, or commission or similar
body or instrumentality thereof.

 

"Intellectual Property" means:

 

a.                
patents, trade marks, service marks, registered designs, applications and rights to apply for any of those rights, trade,
business and company names, internet domain names and e-mail addresses, unregistered trade marks and service marks, copyrights,
database rights, rights in software, knowhow, rights in designs and inventions;

 

b.               
rights under licenses, consents, orders, common law, statutes or otherwise in relation to a right in paragraph (a);

 

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c.                
rights of the same or similar effect or nature as or to those in paragraphs (a) and (b) which now or in the future
may subsist; and

 

d.               
the right to sue for past infringements of any of the foregoing rights.

 

"Intellectual Property Rights"
means all Intellectual Property owned or used by the Company.

 

"Knowledge of Seller" (or
similar phrases) means the actual knowledge of: Seller, in each case after reasonable inquiry of relevant senior officers of the
Company who are responsible for the management and operation of the Company.

 

"Law" means any statute,
law, code, judicial decision, judgment, rule, regulation, ordinance, order, decree, injunction or other pronouncement of any Governmental
Entity having the effect of law.

 

"Liability" means any liability
or obligation (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.

 

"Material Adverse Effect"
means any event or occurrence that, when taken individually or in the aggregate with all other events and occurrences, has a material
adverse effect on the business, results of operations or financial condition of the Company.

 

"Ordinary Course of Business"
means, with respect to the Company, the ordinary course of commercial operations customarily engaged in by the Company, consistent
with past practices.

 

"Person" means an association,
a corporation, an individual, a partnership, a limited liability company, an unlimited liability company, a trust or any other
entity or organization, including a Governmental Entity.

 

“Purchase Price” means $807,651.16 to be paid as follows:
(i) at Closing, by satisfaction by Purchaser of the Prior Note; and (ii) in installments of $50,000 per month over the next 12
months commencing on the first month anniversary of the Closing Date and continuing on each subsequent month anniversary for 11
consecutive months.

 

Article
II

PURCHASE AND SALE OF TRANSFERRED SHARES

 

Section
2.1            Purchase
and Sale of Transferred Shares. Upon the terms set forth herein and at Closing, Seller hereby agrees to sell to
Purchaser, and Purchaser hereby agrees to purchase and accept from Seller, the Transferred Shares free and clear of any Encumbrances
and liabilities (other than the Prior Note) in consideration of payment of the Purchase Price.

 

Section
2.2            Closing.
The closing of the transactions contemplated by this Agreement (the "Closing") shall take place out of
an escrow closing to be held by Jolie Kahn, Esq. The Closing shall take place on May 24, 2013, or such other date and time as
mutually agreed to by Seller and Purchaser but no later than May 31, 2013 (the "Closing Date”). Seller and Purchaser
agree that the Closing shall be effective as of the Effective Time.

 

Section
2.3            Closing
Deliveries.

 

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(a)          
At Closing, Seller shall deliver, or cause to be delivered:

 

(i)     
to Purchaser, certificates evidencing the Transferred Shares duly endorsed in blank, or
accompanied by stock powers duly executed in blank, in form satisfactory to the Purchaser;

 

(ii)     
a copy of the Certificate of Incorporation of the Company in effect as of the Effective
Time, accompanied by a certificate of an executive officer of the Company, dated as of the date hereof, stating that no amendments
have been made to such Certificate of Incorporation since such date; 

 

(iii)     
written evidence of consent, as required as obtained by Company, from any lessors of real
property and from other third parties prior to or in connection with the consummation of the transactions contemplated by this
Agreement;

 

(iv)      the written release
of all Encumbrances (if any), other than Permitted Encumbrances, relating to the assets and properties of the Company and the
Transferred Shares, executed by the holder of or parties to each such Encumbrance, in form and substance satisfactory to Purchaser;

 

(v)     
the certificate referred to in Section 6.1;

 

(vi)     
certified true copies of resolutions of the board of directors or similar governing body of the Company, and the resolutions
of the shareholders of the Company, authorizing and approving this Agreement and the transactions contemplated hereby;

 

(viii)such other documents as may
be reasonably required to transfer good title to the Shares and to enable Purchaser to become the registered holder thereof; and

 

(b)            At Closing, Purchaser shall deliver, or cause to be delivered, to Seller:

 

(i)     
the cancelled Prior Note;

 

(ii)     
a true and complete copy, certified by the Secretary of the Purchaser, of the resolutions
duly and validly adopted by the Board of Directors of the Purchaser evidencing its authorization of the execution and delivery
of this Agreement and the agreements related thereto and the consummation of the transactions contemplated hereby and thereby;
and

 

(iii)     
the certificate referred to in Section 6.2.

 

Section
2.4            Due
Diligence Contingency. Purchaser’s obligation to close
hereunder is expressly conditioned upon satisfactory completion of due diligence to its sole satisfaction.

 

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ARTICLE III

 

OPERATION OF THE COMPANY 

 

 

Section 3.1            Operation
of the Company. The business of the Company shall be managed and operated by the Parties during the five-year period following
the Closing Date of this transaction (the “Transition Period”) pursuant to the following guidelines:

  

(a)           
John Pena shall serve as CEO of the Company and Trisha Malone shall serve as CFO and Secretary both pursuant to the forms of employment
agreements attached hereto as Schedule 3.1.

 

(b)            The Board shall consist of five directors: three appointed by John Pena and
two appointed by Purchaser.

 

Section 3.2            MMA
Business. The parties shall work together to operate the MMA business encompassing the Transferred Assets.

ARTICLE
IV

REPRESENTATIONS AND WARRANTIES OF SELLER

 

Seller represents and
warrants to Purchaser that the statements contained in this Article IV are true, correct and complete as of the date hereof, and
will be true, correct and complete as of the Closing Date, except as specified to the contrary in the corresponding schedule referenced
below and incorporated by reference herein, which schedules shall be prepared by Seller.

 

Section
4.1            Corporate Status.

 

(a)          
Seller has all requisite power and authority to enter into this Agreement and to perform
his obligations hereunder.

 

(b)         
The Company (i) is duly incorporated, organized, validly existing and in good standing as
a corporation in the State of Nevada, (ii) has all requisite power and authority required to own, operate or lease the properties
and assets now owned, operated or leased by it as of the date of this Agreement and to carry on its business as it is being conducted
as of the date of this Agreement; and (iii) the Company is duly licensed or qualified to do business in each of the jurisdictions
in which the ownership, operation or leasing of its properties and assets and the conduct of its business requires it to be so
licensed or qualified, except in the case of clause (iii) where any such failure has not had, or would not reasonably be expected
to have, a Material Adverse Effect. 

 

Section
4.2            Authorization. The execution and
delivery by Seller of this Agreement and the agreements related hereto to which Seller is a party, and the consummation by Seller
of the transactions contemplated hereby and thereby, have been duly and validly authorized by Seller. Each of this Agreement and
the agreements related hereto to which Seller is a party has been duly executed and delivered by Seller, and (assuming due authorization,
execution and delivery by Purchaser) this Agreement and the agreements related hereto to which Seller is a party constitute valid
and binding obligations of Seller, enforceable against Seller in accordance with their respective terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar Laws relating to or affecting creditors'
rights generally or by general equitable principles (regardless of whether such enforceability is considered in a proceeding in
equity or at Law). The copies of the charters and governing documents of the Company that have been previously delivered to Purchaser
are the complete, true and correct charters and governing documents of the Company, as applicable, in effect as of the Effective
Time.

 

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Section
4.3            Capitalization. The Transferred
Shares represent all of the Shares. All of the Transferred Shares are, as of the Effective Time, and were when issued, duly authorized
and validly issued in accordance with the charter and governing documents of the Company and in compliance with all relevant Laws
of the jurisdictions in which the Company was formed, fully paid and not repaid and non-assessable, and are not as of the Effective
Time, and were not when issued, subject to any preemptive rights. Neither the sale of the Transferred Shares by Seller
to Purchaser pursuant to the terms of this Agreement, nor any of the transactions contemplated hereby are subject to any preemptive
rights, rights of first refusal or any other similar restrictions on transfer. Except as set forth on Schedule 4.3, there
are no employee equity incentive plans or programs of the Company currently in effect. There are no outstanding (i) securities
of the Company convertible into or exchangeable for Shares, (ii) options or other rights to acquire from the Company, or
any obligation of the Company to issue, sell, repurchase, redeem or otherwise acquire, any of the Shares or securities convertible
into or exchangeable for the Shares or (iii) stock appreciation, profit sharing or phantom stock or similar rights of the Company.
Seller has not granted any voting rights, proxies or agreements or understandings with respect to voting of the Transferred Shares.

 

Section
4.4            Ownership of the Transferred Shares.
Seller is the owner of the Transferred Shares and holds valid title to the Transferred Shares, free and clear of any Encumbrances.
Except for this Agreement and the transactions contemplated hereby, there are no agreements, arrangements, warrants, options,
puts, calls, rights or other commitments or understandings of any character to which Seller is a party or by which any of its
assets are bound and relating to the issuance, sale, purchase, redemption, conversion, exchange, registration, voting or transfer
of the Transferred Shares. Seller has the full and exclusive power, right and authority to vote the Transferred Shares, and, except
as set forth in Schedule 4.4, is not a party to or bound by any agreement affecting or relating to its right to vote the
Transferred Shares. Upon consummation of the transactions contemplated hereby, Purchaser will own the Transferred Shares free
and clear of all Encumbrances.

 

Section 4.5            No
Conflict. The execution, delivery and performance by Seller of this Agreement and the agreements related hereto to which
Seller is a party and the consummation by Seller of the transactions contemplated hereby and thereby do not and will not (i) conflict
with or result in a violation or breach of any provision of any Law or judgment, order, writ, injunction or decree of any court
or other Governmental Entity to which Seller or the Company is subject, (ii) require the consent, notice or other action
by any Person under, conflict with, result in a violation or breach of, constitute a default or an event that, with or without
notice or lapse of time or both, would constitute a default under, result in the acceleration of or create in any party the right
to accelerate, terminate, modify or cancel any Contract to which Seller or the Company is a party or by which Seller or the Company
is bound or to which any of their respective properties and assets are subject or any permit, license or other authorization affecting
the properties, assets or business of the Company, (iii) conflict with or result in a violation or breach of, or default
under, any provision of the organizational documents of Seller or the Company, or (iv) result in the creation or imposition of
any Encumbrance on any properties or assets of the Company.  

 

Section
4.6            Governmental Filings. No filing or registration with, notification to, or authorization, consent,
permit, waiver or approval of, any Governmental Entity (collectively, "Governmental Filings") is required in
connection with the execution, delivery and performance of this Agreement by Seller or the consummation by Seller of the transactions
contemplated hereby.

 

Section
4.7            Books and Records. The books of account and other financial records of the Company, all of which have
been made available to Purchaser, are complete and correct and represent actual, bona fide transactions and have been maintained
in accordance with sound business practices and, where applicable, GAAP. The minute books of the Company, all of which have been
made available to Purchaser, contain accurate and complete records of all meetings held of, and action taken by, the shareholders
and the board of directors or similar governing bodies of the Company, and no meeting of any such shareholders or governing body
has been held for which minutes are not contained in such minute books.

 

Section
4.8            Absence of Material Adverse Effect; Ordinary Course of Business; Material Transactions. Since December
31, 2012, except as set forth in Schedule 4.8, there has not been with respect to the Company or its properties or assets:

 

(a)         
any
adverse change in the business, condition, financial or otherwise, or operations of the Company or the condition of the Company’s
properties or assets, and, to the Knowledge of Seller, no such change will arise from the consummation of the Contemplated Transactions;

 

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(b)         
any declaration, setting aside or payment of any dividend or any distribution (in cash or
in kind) to any Person or entity with respect to any securities of the Company;

 

(c)          
any transaction entered into or carried out by the Company other than in the Ordinary Course
of Business; 

 

(d)         
any material modification or termination of, or the occurrence of an event that could reasonably
give rise to any material modification or termination of, any material oral or written contract or agreement of the Company or
any material term thereof or any Governmental Entity license, permit or other authorization;

 

(e)          
any change in any method of accounting or accounting policies of the Company, or any write-down
in the accounts receivable of the Company other than in the Ordinary Course of Business; or

 

(f)          
any binding commitment or agreement by Seller or the Company to do any of the foregoing.

  

Section
4.9            Affiliate Transactions. No
director, manager, officer, employee, shareholder or Affiliate of the Company or any individual related by blood, marriage or
adoption to any such individual or any entity in which any such individual or entity owns any beneficial interest is a party to
any agreement, contract, commitment or other form of transaction or arrangement with the Company, written or oral, or has any
interest in any of the Company's assets or properties, except as specifically set forth in Schedule 4.9 and which represents
transactions conducted on arms-length terms. 

 

Section
4.10           Pending Litigation.

 

(a)          
There are no actions, proceedings or investigations pending against Seller before any Governmental
Entity or threatened in writing against Seller which would reasonably be expected to restrict Seller's ability to perform its obligations
under the Agreement or consummate the transactions contemplated hereby.

 

(b)         
Except as set forth on Schedule 4.10, there is no, and since January 1, 2011 there
has not been, any suit, claim, litigation, proceeding (administrative, judicial, or in arbitration, mediation or alternative dispute
resolution), Governmental Entity or grand jury investigation, or other action (any of the foregoing, "Action")
pending or, to the Knowledge of Seller, threatened and, to the Knowledge of Seller, there have been no incidents, actions or omissions
that can reasonably be expected to result in the commencement of any such suit, claim, litigation, proceeding, investigation or
other action, against the Company or involving its business, assets or properties, or, in connection with the Company's business,
any Company shareholder or representative, including without limitation any Action challenging, enjoining or preventing this Agreement
or any agreement related hereto or the consummation of the transactions contemplated hereby or thereby.

 

(c)          
The Company is not and, since January 1, 2011 has not been, subject to any judgment, order,
writ, injunction or decree of any court or other Governmental Entity.

 

Section
4.11           Environmental and Other Permits and Licenses(d).
The Company is in compliance with all applicable environmental Laws and all environmental permits. The business operations of
the Company do not involve any contamination of soil or ground water, air pollution or other environmental pollution that may
result in remedial claims against the Company. For the current business operations, the provision of fresh water and disposal
of sewage or gas and solid emissions or waste is fully ensured. There are no environmental claims pending or, to the Knowledge
of Seller, threatened against the Company.

 

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Section
4.12           Permits; Compliance with Law.

 

(a)          
The Company, its directors and its employees have all governmental authorizations, consents,
licenses, permits (whether temporary or otherwise), approvals, orders, waivers, registrations and other rights necessary, and have
provided all notices required, for the conduct of its business as it is being conducted as of the date of this Agreement, and all
of such authorizations, consents, licenses, permits, approvals, orders, waivers, registrations, rights and notices are in full
force and effect. The Company is not in default or violation under any such authorizations, consents, licenses, permits, approvals,
orders, waivers, registrations and rights and notices. 

 

(b)         
The Company is and has been at all times in compliance in all material respects with all
applicable Law. The Company has not received any notice alleging such default, breach or violation. Neither the execution of this
Agreement nor the consummation of the transactions contemplated hereby does or will constitute or result in any such breach, default
or violation by the Company.

 

Section
4.13           Tax.

 

(a)          
The Company has timely filed all tax returns (“Tax Returns”) required by Law,
taking into account any extension of time to file granted to or obtained on behalf of the Company. All such Tax Returns filed by
or with respect to the Company are true, correct and complete and were prepared in compliance with all applicable Law. The Company
has paid (or caused to be paid on its behalf) all Taxes due and owing, whether or not shown on its Tax Returns. The Company has
not filed any Tax Return that is, or would be, subject to penalties for underpayment of tax, understatement of income, negligence
or disregard of rules, valuation misstatements or other tax shelter transaction.

 

(b)         
The Company is currently not a beneficiary of any extension of time within which to file
any Tax Return. The Company has not waived any statute of limitations with respect to Taxes or agreed to any extension of time
with respect to a Tax assessment or deficiency, nor is any such waiver or extension pending.

 

(c)          
No Governmental Entity is asserting, or has asserted in the last six (6) years as of the
Closing any deficiency or claim for any amount of additional Taxes against the Company.

 

(d)         
Within the last six (6) years, no claim has ever been made by any Governmental Entity in
a jurisdiction where the Company does not file Tax Returns that the Company is or may be subject to taxation in that jurisdiction.

 

(e)          
The Company has withheld and paid all Taxes required to have been withheld and paid in connection
with any amounts paid or owing to any employee, independent contractor, creditor, shareholder, or other third party.

 

(f)          
No federal, state, local or foreign audits, administrative, court or other proceedings is
pending as of the Closing with regard to any Taxes or Tax Returns of the Company.

 

(g)         
For the purposes of this Agreement:

 

(i)     
"Taxes" shall mean any and all taxes, charges, regulated by law and imposed
by any Governmental Entity or taxing authority, fees, levies, interest or other assessments, or impositions of any kind payable
to the relevant Governmental Entity, including all interest and penalties thereon, and additions to tax or additional amounts
attributable to, imposed upon, or with respect to such tax, charges, custom duties, social security payments, duties regulated
by public law and imposed by any Governmental Entity, fees, levies, interest, assessments or impositions, as transferee or successor,
by contract or otherwise. The term "Income Tax" means any tax measured by net income or gross income.

 

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(ii)     
"Tax Returns" shall mean any report, return, document, declaration, report,
claim for refund, information return or statement, or other filing relating to Taxes, including any schedule or attachment thereto,
and including any amendment thereof.

 

Section
4.13           Employees and Labor Relations.

 

(a)          
The Company is, as of the date hereof, in compliance with all Laws respecting employment, immigration, temporary workers,
fixed term employment contracts, employment practices, benefit plans, pension agreements and pension promises, terms and conditions
of employment, wages and hours, including any notice, training and filing requirements there under, and there are no pending or,
to the Knowledge of the Seller, threatened investigations or claims by any branch or department of any Governmental Entity regarding
its compliance with these Laws.

 

(b)      
The Company is not a party to or otherwise bound by any collective bargaining agreement such as tariff agreements or shop
agreements, project labor agreement, memorandum of understanding, letter agreement, side agreement, contract or any other agreement
or understanding with a labor union, labor organization or group of employees acting in concert. As of the date hereof, the Company
is not subject to any charge, demand, request for recognition, petition or representation proceeding seeking to compel, require
or demand it to recognize and/or bargain with any labor union, labor organization, works council, joint works council, group works
council or any other group of employees acting in concert nor, as of the date hereof, is there pending or threatened, any election
procedure of a works council, labor strike, dispute, walkout, work stoppage, slow-down or lockout involving the Company.

 

(c)      
There is no basis for any action or proceeding against, and no action or proceeding pending or threatened against, the Company:
(i) breach of an actual or implied contract of employment (including, but not limited to, any claim of fraud, promissory fraud,
promissory estoppels or fraudulent misrepresentation in the making of any actual or implied contract of employment), (ii) unjust,
wrongful, discriminatory (incl. "mobbing"), retaliatory or tortuous discharge (including any claim of whistle blowing),
(iii) slander, libel or other action claiming defamation, (iv) intentional tort (including assault, battery, conversion and/or
intentional infliction of emotional distress) or (v) negligent infliction of emotional distress, negligent hiring, negligent supervision
or negligent retention.

 

(d)     
There is no basis for any claim against, and no claim is pending or threatened against, the Company arising out of any Law
relating to discrimination in employment or employment practices or occupational safety and health standards.

 

(e)      
Schedule 4.13 contains for the Company a complete and correct list of all employees and officers, directors or appointed
officials of the Company (“Employees”).

 

(f)       
Schedule 4.13 contains copies of all individual contracts including all supplemental agreements (e.g. post contractual
restraints from competition, bonus agreements, company car agreements, pension agreements) of the employees, officers or consultants
of the Company which the Company is or can become liable for.

 

(g)      
There are no claims of any person, which are not listed in Schedule 4.13, to conclude or continue an employment arrangement.
There are no unsettled liabilities, entitlements, pending law suits or any other pending or threatened requests of former employees,
managing directors or officers, directors or other appointed officials of the Company, which are not listed in Schedule 4.13.

 

(h)      
There have been no transfers, purchases or sales of any businesses or business lines by the Company within the last five
(5) years.

 

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Section
4.14           Real Property.

 

(a)          
The Company does not own any land or other interest in real property.

 

(b)         
Schedule 4.14 lists all leases and subleases of the Company for real property (individually,
a "Lease" and collectively, the "Leases"), and identifies the property underlying such leases
(the "Leased Real Property"), the lessor, rental rate, lease term, expiration date and existence of a renewal
option. Seller has made available to Purchaser prior to the Closing correct and complete copies of the Leases listed on Schedule
4.14. With respect to each Lease, except as otherwise indicated on Schedule 4.14:

 

(i)     
the Lease is in full force and effect and will remain in full force and effect on identical
terms on and after the Closing, and the Company is in possession of the leased premises and all rental and other obligations of
the Company are current;

 

(ii)     
the Company is not in breach or default (and has not received notice of breach or default),
and no event has occurred which, with notice or lapse of time, would constitute a breach or default or permit termination, modification,
or acceleration under the Lease;

 

(iii)     
the landlord party to such Lease is not in breach or default of such Lease, and no event
has occurred which, with notice or lapse of time, would constitute a breach or default by such landlord party;

 

(iv)     
to Seller's Knowledge, no party has repudiated any provision of such Lease;

 

(v)     
the Company has not assigned, transferred, conveyed, mortgaged, deeded in trust, or encumbered
any interest in the leasehold or subleasehold; and

 

(vi)     
all facilities leased or subleased thereunder have received all approvals, licenses and
permits of Governmental Entities required in connection with the operation thereof by the Company and have been operated and maintained
by the Company in compliance with applicable Law.

 

Section
4.15            Brokers' Fees. No broker, investment banker, financial advisor or other Person is entitled to any
broker's, finder's, financial advisor's or other similar fee or commission in connection with this Agreement or the transactions
contemplated hereby based upon arrangements made by or on behalf of Seller or any of its Affiliates.

 

Section
4.16            Title and Condition to Assets. The Company has good and indefeasible fee title to, or a valid leasehold
interest in, all of its tangible assets, free and clear of all Encumbrances. Immediately following the Closing, the Company shall
continue to be vested with good and indefeasible title to, or a valid leasehold interest in, the Company’s assets.

 

Section
4.17            Material Contracts.

 

(a)          
Except as set forth in Schedule 4.17, the Company is not a party to or otherwise obligated under or has made (and
under which any party thereto still has remaining rights or obligations) any of the following, whether written or oral (and with
respect to oral agreements, the terms and obligations of the parties thereto are set forth in reasonable detail in Schedule
4.17):

 

    	10

    	 

    

 

(i)        promissory notes, loans, agreements, indentures, evidences of Indebtedness or other instruments relating to the lending
of money, whether as borrower, lender or guarantor, in excess of $1,000;

 

(ii)       license
agreements, consulting services agreements with customers or software support agreements that either provide for payments
in excess of $1,000 or cannot be terminated in one (1) year or less at no cost;

 

(iii)      lease and leasing agreements which provide for annual payments in excess of $15,000;

 

(iv)      agreements with suppliers, clients and customers either with a remaining term of more than one year or an annual contract
value of more than $25,000;

 

(v)       consignment, distributorship and agency agreements;

 

(vi)      guarantees
and sureties granted with respect to any obligation of third parties (including Seller and its Affiliates);

 

(vii)     services,
joint venture and cooperation agreements;

 

(viii)    agreements concerning confidentiality or non-competition;

 

(ix)       agreements or commitments (other
than those types covered above by subsection (a) through (h)) in excess of $35,000 or which cannot be terminated on three (3)
months' notice or less at no cost;

 

(x)        any and all outstanding bids, proposals or other offers to customers which individually have values in excess of $25,000;

 

(xi)       any contract or commitment
not made in the Ordinary Course of Business; and

 

(xii)      any other agreement that
is material to the Company's business, operations or prospects.

 

Seller has delivered to Purchaser a true,
complete and accurate copy of each written contract required to be disclosed in Schedule 4.17 and a true, complete and accurate
description of each oral contract required to be disclosed in Schedule 4.17, and none of such contracts has been modified
or amended in any respect, except as reflected in such disclosure to Purchaser.

 

    	11

    	 

    

 

(b)         
With respect to each contract listed on Schedule
4.17:

 

(i)     
the contract is legal, valid, binding, enforceable and in full force and effect;

 

(ii)     the
Company and, to the Seller’s Knowledge, the other parties to the contract have performed, in all material respects, all
of their material respective obligations required to be performed under the contract; and

 

(iii)    the contract is not under negotiation (nor has written demand for any renegotiation been made) and no party has repudiated
any portion of the contract.

  

Section
4.18           Intellectual Property.

 

(a)          
To the Knowledge of Seller, each of the Intellectual Property Rights used by the Company
is:

 

(i)     
valid and enforceable and nothing has been done or omitted to be done by which it may cease
to be valid and enforceable;

 

(ii)     legally
and beneficially owned by, or licensed to, the Company; and

 

(iii)    not the subject of a claim or opposition from a Person (including, without limitation,
an employee of the Company) as to title, validity, enforceability, entitlement or otherwise.

 

(b)         
To the Knowledge of Seller, the Company owns or possesses all of the Intellectual Property
Rights necessary for the conduct of its business as currently conducted, and such Intellectual Property Rights and conduct are
not in conflict with, or infringement of, the rights of others.

 

(c)          
The Company has not granted or is obliged to grant a license, assignment, consent, undertaking,
security interest or other right in respect of any of the Intellectual Property Rights owned by the Company.

 

(d)         
The Company does not use or operate its business under a name other than its corporate name.

 

Section
4.19           Insurance. The Company agrees to
establish an insurance policy prior to Closing and to maintain insurance with reputable insurance companies in at least such amounts
and against at least such risks as usually insured against by companies engaged in the same or similar business. There are no
pending claims existing under any existing insurance policies of the Company.

 

Section
4.20           Disclosure of all Material Matters.
None of this Agreement, any of the schedules, attachments or exhibits hereto, or any agreements or other documentation contemplated
hereby contain any untrue statement of material fact or omit a material fact necessary to make each statement contained herein
or therein, in light of the circumstances under which they were made, not misleading. There is no fact that has not been disclosed
to Purchaser of which Seller has Knowledge which has had or could reasonably be anticipated to have a Material Adverse Effect.

 

    	12

    	 

    

 

Section 4.21          
Fraudulent Conveyance.

 

The consummation
of the transactions contemplated hereby will not constitute a fraudulent conveyance by Seller. Seller has not been the subject
of a bankruptcy, solvency or similar proceeding or received written or constructive notice of such a proceeding being contemplated
to be brought against it within the 5 years prior of the date hereof. In the case that a voluntary or involuntary bankruptcy proceeding
is brought against Seller with respect to or affecting the Transferred Assets at any time, Seller agrees that this transaction
is immediately null and void at Purchaser’s option and will be unwound, and the Purchaser shall have a springing security
interest in all of the Transferred Assets until the monies paid by Purchaser hereunder are repaid to it in full.

  

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF PURCHASER

 

Purchaser represents and warrants to Seller
that the statements contained in this Article V are true, correct and complete
as of the date hereof, and will be true, correct and complete as of the Closing Date.

 

Section
5.1            Corporate Status. Purchaser is duly organized as a corporation under the Law of Nevada and validly
existing under the Laws of its governing jurisdiction and has all requisite power and authority to enter into this Agreement and
to perform its obligations hereunder.

 

Section
5.2            Authorization. The execution and delivery of this Agreement and the agreements related hereto by Purchaser
and the consummation by Purchaser of the transactions contemplated hereby and thereby have been duly and validly authorized by
Purchaser and no other proceedings of Purchaser are necessary to authorize this Agreement or the agreements related hereto or
to consummate the transactions contemplated hereby and thereby. Each of this Agreement and the agreements related hereto has been
duly executed and delivered by Purchaser and (assuming due authorization, execution and delivery by Seller) this Agreement and
the agreements related hereto constitute a valid and binding obligations of Purchaser enforceable against Purchaser in accordance
with their terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar
Laws relating to or affecting creditors' rights generally or by general equitable principles (regardless of whether such enforceability
is considered in a proceeding in equity or at Law).

 

Section
5.3            No Conflict. The execution and delivery of this Agreement and the agreements related hereto by Purchaser
and the consummation by Purchaser of the transactions contemplated hereby and thereby will not (i) violate any applicable
Law to which Purchaser is subject, (ii) conflict with, result in a violation or breach of, or constitute a default under,
result in the acceleration of or create in any party the right to accelerate, terminate or cancel any contract or agreement by
which Purchaser is bound or (iii) violate the organizational documents of Purchaser other than, in the case of clauses (i) and
(ii) above, any such violations, conflicts, breaches, defaults, accelerations or rights that would not materially impair
or delay Purchaser's ability to perform its obligations under this Agreement or the agreements related hereto or consummate the
transactions contemplated hereby or thereby.

 

Section
5.4            Government Filings. No Governmental Filings are required in connection with the execution and delivery
of this Agreement by Purchaser or the consummation by Purchaser of the transactions contemplated hereby, except such Governmental
Filings, the failure of such Governmental Filings to be made or obtained would not materially impair or delay Purchaser's ability
to perform its obligations under this Agreement or consummate the transactions contemplated hereby.

 

Section
5.5            Brokers' Fees. No broker, investment banker, financial advisor or other Person is entitled to any
broker's, finder's, financial advisor's or other similar fee or commission from Seller or the Company in connection with this
Agreement or the transactions contemplated hereby based upon arrangements made by or on behalf of Purchaser or any of its Affiliates.

 

    	13

    	 

    

 

article
vi

COVENANTS

 

Section
6.1            Publicity. Purchaser and Seller agree that no public release or announcement concerning the terms
of the transactions contemplated hereby shall be issued by any party without the prior written consent of Purchaser, Seller and
the Company, except as a party has determined may be required by Law, legal process or the rules and regulations of any stock
exchange upon which the securities of a party or one of its Affiliates are listed, or as may be required or requested by any Governmental
Entity, in which case such party shall, to the extent practicable and to the extent permitted by Law and legal process, allow
the other party and the Company reasonable time to comment on such release or announcement in advance of such issuance. Notwithstanding
the foregoing, the parties acknowledge that Seller or its Affiliates may make public statements to securities analysts and other
investment community members regarding the transactions contemplated by this Agreement. The parties may also make public statements
to the extent consistent with statements previously made publicly in accordance with this Agreement, or consistent with an outline
of disclosure agreed upon with the other party in advance.

 

Section
6.2            Confidentiality. From and after the Closing, Seller will treat and hold as confidential all of the
Confidential Information of the Company and its business, refrain from using any of the Confidential Information of the Company
and its business, and deliver promptly to Purchaser or destroy, at the request and option of Purchaser, all tangible embodiments
(and all copies) of the Confidential Information of the Company and its business which are in its possession. In the event that
Seller is requested or required (by oral question or request for information or documents in any legal proceeding, interrogatory,
subpoena, civil investigative demand, or similar process) to disclose any Confidential Information of the Company and its business,
Seller will notify Purchaser promptly of the request or requirement so that Purchaser may seek an appropriate protective order
or waive compliance with the provisions of this Section 6.2. If, in the absence of a protective order or the receipt of a waiver
hereunder, Seller is, on the advice of counsel, compelled to disclose any Confidential Information of the Company and its business
to any tribunal or else stand liable for contempt, Seller may disclose the Confidential Information of the Company and its business,
as the case may be, to the tribunal; provided, however, that Seller shall use its reasonable best efforts to obtain, at the reasonable
request of Purchaser and at the sole expense of Purchaser, an order or other assurance that confidential treatment will be accorded
to such portion of the Confidential Information of the Company and its business, as the case may be, required to be disclosed
as Purchaser shall designate.

 

Section
6.3            Non-Competition. For a period starting as of the Closing and ending on the second (2nd) anniversary
of such date, without the prior written consent of Purchaser, Seller and its subsidiaries, officers, directors and affiliates
shall not invest in, own, manage, operate or control any Competing Business; provided, however, that the foregoing shall not restrict
Seller or any of its subsidiaries from (i) acquiring in the aggregate up to 10% of the outstanding capital stock of any publicly
traded company or (ii) acquiring, merging with, or entering into a collaboration or joint venture with a diversified business
engaged in part (such part not to be more than 25% of the aggregate revenues or net income of such business) in a Competitive
Business.

 

Section
6.4            Non-Solicitation.  From the date hereof, neither Seller nor the Company will permit any officer, director,
manager, employee, contractor, representative or agent of any of them to directly or indirectly, (a) solicit, initiate or encourage
the submission or proposal of any offers, or accept any offers, or enter into a confidentiality agreement, letter of intent, or
purchase agreement or other similar agreement with any Person other than Purchaser, with respect
to the acquisition of some or all of the Shares, or a merger, consolidation, business combination, sale of all or any portion
of the assets of the Company, or any similar extraordinary transaction with respect to the Company (an "Acquisition Proposal")
or (b) participate in any discussions or negotiations regarding, or furnish to any Person other than Purchaser any information
with respect to, or otherwise cooperate in any way with or assist, facilitate or encourage any Acquisition Proposal by any Person
other than Purchaser. Each of Seller and the Company agrees to notify Purchaser (within two (2) business days) of all relevant
terms of any proposals by any other Person to do any of the foregoing which Seller or the Company or any of their respective officers,
managers, employees, contractors, representatives or agents may receive relating to any of such matters and, if such proposal
is in writing, Seller or the Company will deliver to Purchaser a copy of such inquiry or proposal.

 

    	14

    	 

    

 

ARTICLE
VII

CONDITIONS TO CLOSING

 

Section
7.1            Conditions Precedent to Obligations of Purchaser. Purchaser’s obligation to effect the Closing
and to take the other actions required to be taken by Purchaser at the Closing is subject to the satisfaction, at or prior to
the Closing, of each of the following conditions (any of which may be waived by Purchaser in writing, in whole or in part):

 

(e)          
All representations and warranties made by Seller in this Agreement shall be true
and correct on and as of the Closing Date as if made at and as of the Closing Date, except that any such representation made as
of a specific date (other than the date hereof) shall only need to have been true on and as of such date;

 

(f)          
The covenants and obligations that Seller is required to perform or to comply with pursuant to this Agreement at or prior
to the Closing must have been duly performed and complied with;

 

(g)         
There shall not be threatened, instituted or pending any action or proceeding, before any court or Governmental Entity,
(i) challenging or seeking to make illegal, or to delay or otherwise directly or indirectly restrain or prohibit, the consummation
of the transactions contemplated hereby or seeking to obtain material damages in connection with such transactions, (ii) seeking
to prohibit direct or indirect ownership or operation by Purchaser of the Shares, (iii) seeking to invalidate or render unenforceable
any material provision of this Agreement, or (iv) otherwise relating to and materially adversely affecting the transactions
contemplated hereby;

 

(h)         
The Company shall have not suffered a Material Adverse Effect;

 

(i)           
Representatives of Purchaser shall have completed the due diligence review of the operations, condition (financial and other),
prospects, assets and liabilities of, and other matters related to, the Company and its business to Purchaser’s satisfaction;

 

(j)           
All consents and approvals contemplated herein shall have been obtained;

 

(k)         
Seller shall have delivered to Buyer all of the deliverables described herein; and

 

(l)           
Seller shall have executed and delivered to Purchaser a certificate of an appropriate officer of Seller dated the Closing
Date, stating that the conditions set forth herein have been satisfied.

 

Section
7.2            Conditions Precedent to Obligations of Seller. Seller’s
obligation to effect the Closing and to take the other actions required to be taken by Seller at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions (any of which may be waived by Seller in writing,
in whole or in part):

 

(a)          
All representations and warranties made by Purchaser in this Agreement shall be true and correct on and as of the Closing
Date as if made at and as of the Closing Date, except that any such representation made as of a specific date (other than the date
hereof) shall only need to have been true on and as of such date;

 

    	15

    	 

    

 

(b)         
The covenants and obligations that Purchaser is required to perform or to comply with pursuant to this Agreement at or prior
to the Closing must have been duly performed and complied with;

 

(c)          
There shall not be threatened, instituted or pending any action or proceeding, before any court or Governmental Entity,
(i) challenging or seeking to make illegal, or to delay or otherwise directly or indirectly restrain or prohibit, the consummation
of the transactions contemplated hereby or seeking to obtain material damages in connection with such transactions, (ii) seeking
to prohibit direct or indirect ownership or operation by Purchaser of the Shares, (iii) seeking to invalidate or render unenforceable
any material provision of this Agreement, or (iv) otherwise relating to and materially adversely affecting the transactions
contemplated hereby;

 

(d)         
Representatives of Seller shall have completed the due diligence review of the operations, condition (financial and other),
prospects, assets and liabilities of, and other matters related to, the Purchaser and its business to Seller’s satisfaction;

 

(e)          
Purchaser shall have delivered to Seller all of the deliverables described herein; and

 

(f)          
Purchaser shall have executed and delivered to Seller a certificate of an appropriate officer of Purchaser dated the Closing
Date, stating that the conditions set forth in herein have been satisfied.

 

ARTICLE
VIII

MISCELLANEOUS

 

Section
8.1            Survival of Representations and Warranties. The representations and warranties in this Agreement
shall survive the Closing indefinitely.

 

Section
8.2            Indemnification.

 

(a)          
Seller's Agreement to Indemnify. From and after the Closing, Seller shall indemnify,
defend and hold harmless Purchaser, its Affiliates, the Company and their respective officers, directors, shareholders and successors
and assigns from and against any and all losses, damages, demands, claims, actions or causes of action, assessments, awards, penalties,
fines, costs, expenses and liabilities (including reasonable attorneys' fees and expenses but excluding punitive or exemplary damages,
except in the case of fraud or to the extent actually awarded to a Governmental Entity or other third party) (collectively, "Damages")
incurred or to be incurred by any of them to the extent resulting from or arising out of:

 

(i)     
any breach by Seller of any representation or warranty contained in this Agreement, the
schedules hereto, or other certificate or document delivered by Seller pursuant to this Agreement;

 

(ii)     
any breach by Seller of any covenant, agreement or obligation contained in this Agreement
or other document delivered by Seller pursuant to this Agreement; 

 

(iii)     
any Litigation against Seller or the Company; and

 

    	16

    	 

    

 

(iv)     
all and any Taxes affecting, and to be borne by, the Company for the time up to (and including)
the Closing Date if and to the extent the specific Tax in question has not been paid on or prior to the date hereof, or has not
been provided for in the annual accounts, or has not been fully disclosed by Seller to Purchaser. Such indemnity or hold-harmless
shall apply irrespective and regardless of whether or not on the Closing Date the Seller had knowledge or should have had knowledge
of such obligation to pay Taxes. For the avoidance of doubt, it is the intention of the parties that, in the case of any such
Taxes for any period in which the determination of the amount of such Taxes due for such period does not coincide with or end
on the Closing Date, the amount of such Taxes deemed a liability of the Company for the time up to (and including) the Closing
Date shall be determined as if a separate Tax Return was due for a period ending on the Closing Date and the amount of such Taxes
due on that separate Tax Return is determined based on actual events occurring up through and including the Closing Date. In the
event that any Taxes are assessed once annually, for example, property taxes, then in lieu of the rules for proration in the previous
sentence, if such Tax is not yet been paid for the annual period that includes the Closing Date, then liability of the Company
for such Tax under this section shall be equal to the amount of such Tax times a ratio of the days in such period before and including
the Closing date divided by 365. 

 

(b)         
Purchaser's Agreement to Indemnify.
Upon the terms and subject to conditions of this Section 8.2, from and after the Closing, Purchaser shall indemnify, defend and
hold harmless Seller, its Affiliates, and their respective officers, directors and successors and assigns from and against any
and all Damages incurred or to be incurred by any of them to the extent resulting from or arising out of

 

(i)     
any breach by Purchaser of any representation or warranty contained in this Agreement or
other certificate or document delivered by Purchaser pursuant to this Agreement; and

 

(ii)     
any breach by Purchaser of any covenant, agreement or obligation contained in this Agreement.

 

(c)          
Third-Party Claims. The obligations
and liabilities of Seller and Purchaser with respect to any claims made by an indemnified party which arise or result from claims
for Damages made by third parties or for which liability may be asserted by any third party including any Governmental Entity
(a "Third-Party Claim"), shall be subject to the following terms and conditions:

 

(i)     
The indemnified parties shall give the indemnifying party prompt written notice of any
such Third-Party Claim; provided, however, that failure to give such notification shall not affect the indemnification provided
hereunder except to the extent the indemnifying party shall have been prejudiced as a result of such failure and provided that
the indemnifying party shall not be responsible for any costs or expenses incurred prior to the giving of such notice or that
arise as a result of such failure to give notice. The indemnifying party shall have the right to undertake the defense of any
Third Party Claim by counsel reasonably satisfactory to the indemnified parties at the indemnifying party's sole expense; provided,
that if the indemnifying party assumes such defense the indemnifying party shall control such defense and any contacts with third
parties with respect to such Third Party Claim, however, the indemnified parties shall have the right to participate in the defense
thereof and to employ counsel, at their own expense, separate from the counsel employed by the indemnifying party, it being understood
that the indemnifying party shall control such defense and all parties shall be afforded access to all information pertinent to
the defense; provided, further, that the reasonable fees and expenses of one counsel to the indemnified parties will be indemnifiable
hereunder if, in the reasonable view of counsel to the indemnified party, (x) a conflict of interest exists between the indemnifying
party and the indemnified parties or (y) there may be legal defenses available to the indemnified parties which are different
from or additional to those available to the indemnifying party; and

 

    	17

    	 

    

 

(ii)     
Notwithstanding any provision in this Section 8.2(c) to the contrary, without the prior
written consent of the indemnified parties (which consent shall not be unreasonably conditioned, withheld or delayed), the indemnifying
party shall not admit any liability with respect to, or settle, compromise or discharge, any Third-Party Claim or consent to the
entry of any judgment with respect thereto. In addition, if notice of a Third Party Claim has not been provided, or if notice
has been provided and the indemnifying party shall have assumed the defense of the Third-Party Claim, the indemnified party shall
not admit any liability with respect to, or settle, compromise or discharge, any Third-Party Claim or consent to the entry of
any judgment with respect thereto, without the prior written consent of the indemnifying party (which consent shall not be unreasonably
conditioned, withheld or delayed), and the indemnifying party will not be subject to any liability for any such admission, settlement,
compromise, discharge or consent to judgment made by an indemnified party without such prior written consent of the indemnifying
party.

 

(d)         
Other Claims. In the event any indemnified party should have a claim against
any indemnifying party under Section 8.2 hereof that does not involve a Third-Party Claim being asserted against or sought to be
collected from such indemnified party, the indemnified party shall, as promptly as practicable after discovery of such claim, deliver
written notice of such claim to the indemnifying party. The failure by any indemnified party to so notify the indemnifying party
shall not relieve the indemnifying party from any liability which it may have to such indemnified party under Section 8.2, except
to the extent that the indemnifying party shall have been materially prejudiced by such failure.

 

(e)          
Limitations; Sole Remedy, etc.

 

(i)     
Notwithstanding any provision in this Agreement to the contrary, the obligation of any
indemnifying party to indemnify an indemnified party pursuant to this Section 8.2 shall be limited to claims which an indemnified
party has given the indemnifying party written notice pursuant to Section 8.2(c) or (d), as applicable, setting forth therein
in reasonable detail the basis for such claim.

 

(ii)     
Notwithstanding anything to the contrary contained in this Agreement: (a) an indemnifying party shall not be liable for
any claim for indemnification unless and until the aggregate amount of indemnifiable Damages which may be recovered from the indemnifying
party (taking into account clause (i) hereof) equals or exceeds a one-time deductible amount of $25,000 (the "Deductible"),
in which case the indemnified party entitled to such indemnification shall be entitled to recover all such Damages to which such
indemnified party is entitled in excess of the Damages constituting the Deductible, and (b) in no event shall the aggregate amount
of all claims for which Seller or Purchaser is liable pursuant to Section 2.4(a)Section 8.2, as applicable, exceed an amount equal
to the Purchase Price; except in each case with respect to (i) Damages arising from fraud, willful misconduct or intentional breach
of covenants or other agreements herein by Purchaser or Seller, as applicable, or (ii) a breach of a Fundamental Rep by Seller
or by Purchaser.

 

(iii)     
Each of Seller and Purchaser acknowledges and agrees that its sole and exclusive remedy
(other than for fraud or intentional misconduct) following the Closing with respect to any and all claims (whether Third-Party
Claims or otherwise) relating to the subject matter of this Agreement shall be pursuant to the provisions set forth in this Section
8.2; provided, however, that nothing contained herein shall prevent (A) an indemnified party from pursuing remedies as
may be available to such party under applicable Law in the event of an indemnifying party's failure to comply with its indemnification
obligations hereunder or (B) any party from pursuing a claim for specific performance pursuant to Section 8.14 hereof.

 

    	18

    	 

    

 

(iv)     
Any liability for indemnification hereunder shall be determined without duplication of
recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation,
warranty, covenant or agreement. 

 

(v)     
 Any indemnity payment made hereunder shall be treated by the parties as an adjustment
to the Purchase Price. Any indemnification obligation under this Agreement shall be net of any tax benefits realized by the indemnified
parties or its Affiliates, and any insurance or indemnity, contribution or similar amount received by the indemnified party or
its Affiliates from any third party with respect thereto. To the extent that any indemnity is not treated as a Purchase Price
adjustment and is subject to tax, such payment shall be increased so that on an after-tax basis, the payment shall equal the amount
of the indemnity provided in Section 8.2. 

 

(vi)     
For purposes of determining the amount of any Damages under this Section 8.2 (but not for
purposes of determining whether a breach of any representation or warranty has occurred) each of the representations and warranties
that contains any "Material Adverse Effect," "in all material respects," or other materiality (or correlative
meaning) qualification shall be deemed to have been given as though there were no such qualification.

 

Section
8.3            Assignment; Binding Effect. This Agreement and the rights hereunder
are not assignable unless such assignment is consented to in writing by both Purchaser and Seller and, subject to the preceding
clause, this Agreement and all the provisions hereof shall be binding upon and shall inure to the benefit of the parties and their
respective successors and permitted assigns.

 

Section
8.4            Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEVADA WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW OR CONFLICTING PROVISION OR RULE (WHETHER OF THE STATE OF NEVADA
OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEVADA TO BE APPLIED. IN FURTHERANCE
OF THE FOREGOING, THE INTERNAL LAW OF THE STATE OF NEVADA WILL CONTROL THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT,
EVEN IF UNDER SUCH JURISDICTION'S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF SOME OTHER JURISDICTION WOULD
ORDINARILY APPLY. EACH PARTY HERETO AGREES AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF ANY COURT SITTING IN NEVADA, NEVADA AND
ANY UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEVADA (IF FEDERAL JURISDICTION EXISTS), AND ANY APPLICABLE APPELLATE COURTS,
WITH RESPECT TO ALL MATTERS RELATING TO THIS AGREEMENT AND TO THE TRANSACTIONS CONTEMPLATED HEREBY, WAIVES ALL OBJECTIONS BASED
ON LACK OF VENUE AND FORUM NON CONVENIENS, AND IRREVOCABLY CONSENTS TO THE PERSONAL JURISDICTION OF ALL SUCH COURTS.

 

Section
8.5            Waiver of Jury Trial. Each of the parties hereto hereby waives to the fullest extent permitted by
applicable Law any right it may have to a trial by jury with respect to any litigation directly or indirectly arising out of,
under or in connection with this Agreement or the transactions contemplated by this Agreement. Each of the parties hereto hereby
(a) certifies that no representative, agent or attorney of the other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it has been
induced to enter into this Agreement and the transactions contemplated by this Agreement, as applicable, by, among other things,
the mutual waivers and certifications contained herein.

 

Section
8.6            Notices. All notices and other communications provided for herein shall be dated and in writing and
shall be deemed to have been duly given when delivered, if delivered personally or sent by registered or certified mail, return
receipt requested, postage prepaid and when received if delivered otherwise, to the party to whom it is directed:

 

    	19

    	 

    

 

If to Seller, to:

 

John Pena

101 S. Main St.

Pomona, CA 91766

 

If to Purchaser, to: 

 

Wikifamilies, Inc.

Attn: Trisha Malone, CFO

9025 Carlton Hills Blvd Ste. B

Santee, CA 92071

 

with copies, in the case of notice to Purchaser, to:Jolie
Kahn, Esq. 1020 Riverview, Conshohocken, PA 19428, fax: 866-705-3071

 

Section
8.7            Headings. The headings contained in this Agreement are inserted for convenience only and shall not
be considered in interpreting or construing any of the provisions contained in this Agreement.

 

Section
8.8            Fees and Expenses; Taxes. Except as otherwise provided herein, Seller shall pay all cost and expenses
of Seller and the Company associated with the negotiation, preparation and execution of this Agreement, and consummation of the
transactions contemplated hereby. Purchaser shall pay all costs and expenses incurred on
its behalf in connection with the negotiation, preparation and execution of this Agreement, and consummation of the transactions
contemplated hereby. Each of Seller and Purchaser shall timely file with the competent taxation authorities any tax returns, reports
and other documents that are required to be filed by such party under the relevant tax laws in relation to any taxes imposed on
such party resulting from the transaction contemplated herein, and each party shall timely pay such taxes to the competent taxation
authorities and deliver to the other party proof of due settlement of such taxes (or of exemption therefrom).

 

Section
8.9            Entire Agreement. This Agreement (including the Exhibits and schedules hereto) and the agreements
related hereto constitute the entire agreement between the parties with respect to the subject matter hereof and supersedes all
prior agreements and understandings between the parties with respect to such subject matter; provided, however,
this Agreement shall not supersede the terms and provisions of the Confidentiality Agreement, which shall survive and remain in
effect until expiration or termination thereof in accordance with its terms and this Agreement.

 

Section
8.10            Interpretation

 

(a)          
When a reference is made in this Agreement to an Article, Section or Exhibit, such reference
shall be to an Article, Section or Exhibit of or to this Agreement unless otherwise indicated.

 

(b)         
Whenever the words "include," "includes" or "including" are
used in this Agreement, they shall be deemed to be followed by the words "without limitation." 

 

(c)          
When a reference in this Agreement is made to a "party" or "parties,"
such reference shall be to a party or parties to this Agreement unless otherwise indicated.

 

(d)         
Unless the context requires otherwise, the terms "hereof," "herein,"
"hereby," "hereto" and derivative or similar words in this Agreement refer to this entire Agreement.

 

(e)          
Unless the context requires otherwise, the use of any gender herein shall be deemed to include
the other genders.

 

    	20

    	 

    

 

(f)          
References in this Agreement to "dollars" or "$" are to U.S. dollars.

 

(g)         
This Agreement was prepared jointly by the parties and no rule that it be construed against
the drafter will have any application in its construction or interpretation.

 

Section
8.11            Waiver and Amendment. This Agreement may be amended, modified or supplemented only by a written
mutual agreement executed and delivered by Seller and Purchaser. Except as otherwise provided in this Agreement, any failure of
any party to comply with any obligation, covenant, agreement or condition herein may be waived by the party entitled to the benefits
thereof only by a written instrument signed by the party granting such waiver, but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to,
any subsequent or other failure.

 

Section
8.12            Counterparts; Language; Facsimile Signatures. This Agreement may be executed in any number of counterparts,
each of which when executed, shall be deemed to be an original and all of which together shall be deemed to be one and the same
instrument binding upon all of the parties notwithstanding the fact that all of the parties are not signatory to the original
or the same counterpart. For purposes of this Agreement, facsimile signatures or electronic .pdf copies shall be deemed originals.

 

Section
8.13            Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties and their successors
and permitted assigns and nothing herein express or implied shall give or be construed to give to any Person, other than the parties
and such successors and permitted assigns, any legal or equitable rights hereunder, it being understood that the foregoing shall
not limit the right of any indemnified party to bring claims for indemnification under Section 7.2 in respect of Damages.

 

Section
8.14            Specific Performance. The parties agree that if any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached, irreparable damage would occur, no adequate remedy
at Law would exist and damages would be difficult to determine, and that the parties shall be entitled to specific performance
of the terms hereof, in addition to any other remedy at Law or in equity.

 

Section
8.15            Severability. If any provision of this Agreement or the application of any such provision to any
Person or circumstance shall be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision hereof.

 

Section
8.16            Further Assurance. Seller and Purchaser shall and shall procure that their respective Affiliates
shall execute and deliver, or shall cause to be executed and delivered, such documents and other papers and shall take, or shall
cause to be taken, such further actions as may be reasonably required to carry out the provisions of, and give effect to, the
transactions contemplated by, this Agreement.

 

 

    	21

    	 

    

  

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be executed as of the date and year first above written.

 

 

	 	/s/ John Pena
	 	By:	John Pena as an Individual
	 	 	Name: (“Seller”)

 

 

	 	/s/ John Pena
	 	By:	John Pena for JP09 & Associates, Inc

	 	 	Name: (“Seller”)
	 	 	Title: Owner

 

	 	/s/ Trisha Malone
	 	By:	

Trisha Malone for Wikifamilies, Inc.

	 	 	Name: (“Buyer”)
	 	 	Title: CEO, CFO & Secretary

 

 

 

    	22

    	 

    

 

                                                                                                                                              

	 
	 
	AMENDMENT TO SHARE PURCHASE AGREEMENT
	 
	
        by and between

        JOHN PENA

	 
	 
	 
	And
	 
	WIKIFAMILIES, INC.
	 
	Dated as of June 24, 2013
	 
	 

 

 

 

    	23

    	 

    

 

 

SHARE PURCHASE AGREEMENT

 

THIS AMENDMENT TO SHARE PURCHASE AGREEMENT
is made and entered into as of the 24th day of June, 2013 (this "Agreement"), by and among JOHN
PENA, an individual, and JP09 & Associates, Inc., a California corporation, as owner ("Seller"), and Wikifamilies,
Inc. (aka ClairNET, Ltd.), a Nevada corporation ("Purchaser").

 

RECITALS

 

WHEREAS, the parties entered into a Share
Purchase Agreement on May 8, 2013; and

 

WHEREAS, the parties desire to amend the original
Share Purchase Agreement to extend the Closing Date to August 31, 2013 (except as amended hereby, the original Share Purchase Agreement
remains in full force and effect).

 

NOW, THEREFORE, in consideration of the foregoing,
the representations, warranties, covenants and agreements set forth in this Agreement, and other good and valuable consideration,
the adequacy and receipt of which are hereby acknowledged, the parties hereby agree as follows:

 

1. Section 2.1 of the Share Purchase Agreement
is hereby amended so that in the second sentence thereof, “May 31, 2013” is hereby replaced with “August 31,
2013”.

 

2. Except as amended hereby, the original
Share Purchase Agreement remains in full force and effect.

 

IN WITNESS WHEREOF, the parties hereto have
caused this Amendment to Share Purchase Agreement to be executed as of the date and year first above written.

 

By:/s/ John Pena

(“Seller”)

 

 

 

 

WIKIFAMILIES, INC.

		By:	/s/ Trisha Malone

Name: Trisha Malone

Title: CEO

(“Buyer”)

 

 

    	24Exhibit 10.68

 

EMPLOYMENT AGREEMENT 

 

THIS EMPLOYMENT AGREEMENT
(this “Agreement”) is entered into by and between Jim Schutz (the “Executive”), and Oculus
Innovative Sciences, Inc., a Delaware corporation (the “Corporation”), as of June 20, 2013 (the “Effective
Date”). This Agreement replaces that certain employment agreement dated as of January 1, 2004 and entered into by and
between the Executive and the Corporation.

 

RECITALS

 

WHEREAS, prior to
the date hereof, the Executive has served in various capacities with the Corporation, including Chief Operating Officer and General
Counsel and as of the effective date of February 4, 2013 as the Corporation’s President and Chief Executive Officer, in accordance
with the terms and conditions set forth in the related employment agreement dated as of January 1, 2004 between the Corporation
and the Executive;

 

WHEREAS, the Corporation
desires that the Executive continue to be employed by the Corporation as its President and Chief Executive Officer, and to carry
out the duties and responsibilities described below, all on the terms and conditions set forth herein;

 

WHEREAS, the Executive
serves as a Director on the Corporation’s Board of Directors; and

 

WHEREAS, the Executive
is willing to accept such employment on such terms and conditions.

 

NOW, THEREFORE,
in consideration of the foregoing premises and the mutual covenants and promises of the parties herein, the receipt and sufficiency
of which are hereby acknowledged by each of the parties, the Corporation and the Executive hereto agree as follows:

 

1. Employment and Duties.

 

1.1 Position.
On the terms and subject to the conditions set forth herein, the Corporation agrees to continue to employ the Executive as its
President and Chief Executive Officer for the Period of Employment (as defined in Section 2). The Executive does hereby accept
and agree to such employment, on the terms and conditions expressly set forth in this Agreement.

 

1.2 Duties.
During the Period of Employment (as defined in Section 2), the Executive shall serve the Corporation as its President and Chief
Executive Officer. The Executive shall, without limitation and without limiting the Executive’s other duties to the Corporation,
and without limiting the authority of the Corporation’s Board of Directors (the “Board”), be responsible
for the general supervision, direction and control of the business and affairs of the Corporation and have such other duties and
responsibilities as the Board shall designate that are consistent with the Executive’s position as President and Chief Executive
Officer of the Corporation. The Executive shall perform all of such duties and responsibilities in accordance with the legal directives
of the Board and in accordance with the practices and policies of the Corporation as in effect from time to time throughout the
Period of Employment (as defined in Section 2) (including, without limitation, the Corporation’s insider trading and ethics
policies, as they may change from time to time). While employed as President and Chief Executive Officer of the Corporation, the
Executive shall report exclusively to the Board. Throughout the Period of Employment (as defined in Section 2), the Executive shall
not serve on the boards of directors or advisory boards of any other entity, except for any wholly or majority owned subsidiaries
of the Corporation, unless such service is expressly approved by the Board.

 

    	1

    	 

    

 

1.3 No Other Employment;
Minimum Time Commitment. Throughout the Period of Employment (as defined in Section 2), the Executive shall both (i) devote
substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for
the Corporation, and (ii) hold no other job. The Executive agrees that any investment or direct involvement in, or any appointment
to or continuing service on the board of directors or similar body of, any corporation or other entity, other than wholly or majority
owned subsidiaries of the Corporation, must be first approved in writing by the Corporation. The foregoing provisions of this Section
1.3 shall not prevent the Executive from investing in non-competitive, publicly-traded securities to the extent permitted by Section
7(b). The Executive agrees that, as of the Effective Date, Exhibit A to this Agreement sets forth a complete and accurate
description of (i) any investment or direct involvement of the Executive in any other corporation or business that reasonably could
be construed as falling outside of the scope of the foregoing permitted investments and involvement, and (ii) any board of directors
or similar body of any corporation or other entity on which the Executive is a member, other than wholly or majority owned subsidiaries
of the Corporation.

 

1.4 No Breach of
Contract. The Executive hereby represents to the Corporation that: (i) the execution and delivery of this Agreement by the
Executive and the Corporation and the performance by the Executive of the Executive’s duties hereunder shall not constitute
a breach of, or otherwise contravene, the terms of any other agreement or policy to which the Executive is a party or otherwise
bound; (ii) the Executive has no information (including, without limitation, confidential information and trade secrets) of any
other person or entity which the Executive is not legally and contractually free to disclose to the Corporation; and (iii) the
Executive is not bound by any confidentiality, trade secret or similar agreement (other than this Agreement) with any other person
or entity.

 

1.5 Location.
The Executive acknowledges that the Corporation’s principal executive offices are currently located in Petaluma, California.
The Executive’s principal place of employment shall be the Corporation’s principal executive offices, though such principal
place of employment of the Executive may be moved from time to time upon mutual agreement by the Executive and the Corporation.
The Executive agrees that the Executive will be regularly present at the Corporation’s principal executive offices, or such
other location as the parties may designate, and that the Executive may be required to travel from time to time in the course of
performing the Executive’s duties for the Corporation.

 

2. Period of Employment. The “Period
of Employment” shall commence on the Effective Date, and shall continue in full force and effect until the date of the
Executive’s termination pursuant to Section 5. This Agreement shall govern the terms of Executive’s employment hereunder
on and after the Effective Date.

 

3. Compensation. 

 

3.1 Base Salary.
As of the Effective Date and during the Period of Employment, the Corporation shall pay to the Executive a base salary at the rate
of $250,000 per year, subject to increase (but not decrease) by the Board (the “Base Salary”) with the sole
exception set forth in Section 3.2 below. The Executive’s Base Salary shall be paid in accordance with the Corporation’s
regular payroll practices in effect from time to time, but not less frequently than in monthly installments.

 

3.2 Stock Awards.
As soon as practical following the execution of this agreement, the Corporation shall issue to the Executive 300,000 common
stock options.  The exercise price of the stock option grant will be $6.00 per share of stock. Such options will be registered on a Form S-8. The Executive shall continue
to vest in those options to purchase the Corporation’s common stock previously granted to the Executive in accordance with
the terms of such option grants. The Corporation may, in its sole discretion, grant additional stock options and/or make other
stock-based awards to the Executive.

 

    	2

    	 

    

 

4.Benefits.

 

4.1 Health and Welfare.
During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans
and programs made available by the Corporation to the Corporation’s senior-level employees generally, as such plans or programs
may be in effect from time to time.

 

4.2 Reimbursement
of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties
for the Corporation under this Agreement and entitled to reimbursement for all such expenses the Executive incurs during the Period
of Employment in connection with carrying out the Executive’s duties for the Corporation, subject to the Corporation’s
reasonable expense reimbursement policies in effect from time to time. The Corporation shall reimburse the Executive to the extent
required by the preceding sentence.

 

4.3 Vacation and
Other Leave. During the Period of Employment, the Executive shall accrue and be entitled to take paid vacation in accordance
with the Corporation’s standard vacation policies in effect from time to time, including the Corporation’s policies
regarding vacation accruals. The Executive shall also be entitled to all other holiday and leave pay generally available to all
other employees of the Corporation.

 

5.Termination. 

 

5.1 Termination
by the Corporation. The Executive’s employment by the Corporation, and the Period of Employment, may be terminated at
any time by the Corporation: (i) with Cause (as defined in Section 5.5), or (ii) without Cause (as defined in Section 5.5), or
(iii) in the event of the Executive’s death, or (iv) in the event that the Board determines in good faith that the Executive
has a Disability (as defined in Section 5.5).

 

5.2 Termination
by the Executive. The Executive’s employment by the Corporation, and the Period of Employment, may be terminated at any
time by the Executive, on no less than thirty (30) days’ prior written notice to the Corporation. Any termination by the
Executive for Good Reason (as defined in Section 5.5) shall be communicated by a Notice of Termination to the Corporation. For
purposes of this Agreement, in the case of a notice given by the Executive to the Corporation, a “Notice of Termination”
means a written notice which (i) is communicated to the Corporation within thirty (30) days of the initial existence of the condition
giving rise to the Executive’s right to terminate for Good Reason, (ii) indicates the specific termination provision in this
Agreement relied upon, (iii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination
of the Executive’s employment under the provision so indicated, (iv) waives the Executive’s right to terminate for
Good Reason if the Corporation within thirty (30) days of such notice cures the condition otherwise giving rise to the Executive’s
right to terminate for Good Reason, and (v) if the termination date is other than the date that is thirty-one (31) days after the
communication of such notice, specifies the termination date.

 

5.3 Benefits Upon
Termination. If the Executive’s employment by the Corporation is terminated during the Period of Employment for any reason
by the Corporation or by the Executive, the Corporation shall have no further obligation to make or provide to the Executive, and
the Executive shall have no further right to receive or obtain from the Corporation, any payments or benefits, except:

 

    	3

    	 

    

 

(a) the Corporation
shall pay the Executive (or, in the event of his death, the Executive’s estate) any Accrued Obligations (as defined in Section
5.5); and

 

(b) if, during
the Period of Employment, the Executive’s employment is terminated by the Corporation without Cause (as defined in Section
5.5) or by the Executive for Good Reason (as defined in Section 5.5) (and, in each case, other than due to either the Executive’s
death, or a good faith determination by the Board that the Executive has a Disability (as defined in Section 5.5)):

 

(i) the Corporation
shall, subject to the conditions set forth in Section 5.3(c) and the constraints set forth in Section 5.8, also pay the Executive
a lump sum severance benefit equal to eighteen (18) times the average monthly Base Salary paid to the Executive over the twelve
(12) whole months preceding the month in which the termination of the Executive’s employment occurs (or, if the Period of
Employment has not been in effect for twelve (12) whole months preceding the month in which the termination of the Executive’s
employment occurs, the average monthly Base Salary for this purpose shall be determined based on the average monthly Base Salary
paid to the Executive over the whole months in the Period of Employment occurring prior to the month in which the termination of
the Executive’s employment occurs). Subject to the conditions set forth in Section 5.3(c), such lump sum amount shall be
paid to the Executive (without interest) no later than seven (7) days following the date on which the Executive’s employment
by the Corporation terminates;

 

(ii) the Corporation
shall, subject to the conditions set forth in Section 5.3(c), pay as a severance benefit one hundred percent (100%) of the Executive’s
premiums under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) for the same or reasonably equivalent medical
coverage as in effect on the date the Executive’s employment terminated for a period not to exceed the lesser of one year
following the date of such termination or until the Executive becomes eligible for medical insurance coverage provided by another
employer; and

 

(iii) as of
the date the Executive’s employment terminates, any and all stock options, stock appreciation rights, restricted stock awards,
and similar equity and equity-based awards granted by the Corporation to the Executive outstanding immediately prior to such termination
of employment shall thereupon be deemed fully vested and shall be exercisable for a period of no less than twelve (12) months thereafter
or until the stated expiration date for such option or award at the end of its maximum term, whichever is earlier; provided, however,
that this Section 5.3(b)(iii) shall not affect any right of the Corporation to terminate such option or award in connection with
a change in control of the Corporation or similar event to the extent such right exists under the provisions of any agreement evidencing
such option or award.

 

(c) Any obligation
of the Corporation pursuant to Section 5.3(b) to pay a severance benefit in the circumstances described therein is further subject
to the following two conditions precedent: (i) such severance obligation shall be paid only if the Executive has remained in compliance
with all of the provisions of Section 5.6 and Sections 7 through 12, and such obligation shall terminate immediately if the Executive
is for any reason not in compliance with one or more of the provisions of Section 5.6, and Sections 7 through 12; and (ii) the
Executive’s satisfaction of the release obligations set forth in Section 5.4. For purposes of the preceding sentence, if
the Executive is not in compliance with one or more provisions of Section 5.6, and Sections 7 through 12, and a cure is reasonably
possible in the circumstances, the Executive will not be deemed to have breached such provision(s) unless the Executive is given
notice and a reasonable opportunity (in no case shall more than a 10 business day cure period be required) to cure such breach
and such breach is not cured within such time period. The parties agree that a cure will not be reasonably possible in all circumstances
including, without limitation, a material breach of confidentiality or similar occurrence.

 

    	4

    	 

    

 

(d) Except
as expressly provided herein, the foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt
of benefits otherwise due to terminated employees under group insurance coverage consistent with the terms of the applicable welfare
benefit plan of the Corporation; (ii) the Executive’s rights under COBRA to continue participation in medical, dental, hospitalization
and life insurance coverage; (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the
Corporation’s 401(k) plan (if any); or (iv) any rights that the Executive may have under and with respect to a stock option,
stock appreciation right, restricted stock award, or similar equity or equity-based award, to the extent that such award was granted
before the date that the Executive’s employment by the Corporation terminated and to the extent expressly provided in the
written agreement evidencing such award.

 

5.4 Release; Exclusive
Remedy.

 

(a) This
Section 5.4 shall apply notwithstanding anything else contained in this Agreement to the contrary. As a condition precedent to
any obligation of the Corporation to the Executive pursuant to Section 5.3(b), the Executive shall, upon or promptly following
his last day of employment with the Corporation, provide the Corporation with a valid, executed, written Release (as defined in
Section 5.5) (in a form provided by the Corporation) and such Release (as defined in Section 5.5) shall have not been revoked by
the Executive pursuant to any revocation rights afforded by applicable law. The Corporation shall have no obligation to make any
payment to the Executive pursuant to Section 5.3(b) unless and until the Release (as defined in Section 5.5) contemplated by this
Section 5.4 becomes irrevocable by the Executive in accordance with all applicable laws, rules and regulations.

 

(b) The Executive
agrees that the payments contemplated by Section 5.3 shall constitute the exclusive and sole remedy for any termination of his
employment and the Executive covenants not to assert or to pursue any other remedies, at law or in equity, with respect to any
termination of employment. The Corporation and Executive acknowledge and agree that there is no duty of the Executive to mitigate
damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether
the Executive has taken or takes actions to mitigate damages.

 

5.5 Certain Defined
Terms.

 

(a) As used
herein, “Accrued Obligations” means:

 

(i) any Base
Salary that has accrued but has not yet been paid to the Executive (including accrued and unpaid vacation time) prior to the date
of termination; and

 

(ii) any reimbursement
due to the Executive pursuant to Section 4.2 for expenses incurred by the Executive prior to the date of termination.

 

    	5

    	 

    

 

(b) As used
herein, “Cause” shall mean the reasonable and good faith determination by a majority of the Board based on its
reasonable belief at the time, that, during the Period of Employment, any of the following events or contingencies exists or has
occurred:

 

(i) the Executive
is convicted of, or has pled guilty to, a felony (as such term is defined under the laws of the United States or any state thereof);
or

 

(ii) the Executive
has engaged in acts of fraud, material dishonesty or other acts of willful misconduct in the course of his duties hereunder, unless
the Executive believed in good faith that such acts were in the interests of the Corporation; or

 

(iii) the Executive
willfully and repeatedly fails to perform or uphold his duties under this Agreement; or

 

(iv) the Executive
willfully fails to comply with reasonable directives of the Board which are communicated to him in writing.

 

(c) As used
herein, “Disability” shall mean a physical or mental impairment which substantially limits a major life activity
of the Executive and which renders the Executive unable to perform the essential functions of the Executive’s position, even
with reasonable accommodation which does not impose an undue hardship on the Corporation, for ninety (90) days in any consecutive
twelve (12) month period, but only if the Executive is considered to be disabled within the meaning of Treasury Regulation section
1.409A-3(i)(4). Without limiting the circumstances in which the Executive may be determined to be disabled as defined in Treasury
Regulation section 1.409A-3(i)(4), the Executive will be presumed to be disabled if determined to be totally disabled by the Social
Security Administration or if determined to be disabled in accordance with a disability insurance program, provided the definition
of disability applied under such disability insurance program complies with the requirements of Treasury Regulation section 1.409A-3(i)(4).

 

(d) As used
herein, “Good Reason” shall mean the occurrence of one or more of the following without the Executive’s
written consent:

 

(i) the assignment
of the Executive to duties materially inconsistent with the Executive’s authorities, duties, responsibilities and status
(including titles and reporting requirements) as President and Chief Executive Officer of the Corporation, or a material reduction
or alteration in the nature or status of the Executive’s authorities, duties or responsibilities, other than an insubstantial
and inadvertent act that is remedied by the Corporation promptly after receipt of notice thereof given by the Executive; or

 

(ii) a reduction
by the Corporation in the Executive’s Base Salary as in effect on the Effective Date or as the same shall be increased from
time to time, other than as specified in Section 3.2, or the Corporation otherwise fails to satisfy its compensation obligations
to the Executive under this Agreement, after written notice by the Executive and a reasonable opportunity to cure; or

 

(iii) only
after a sale of the Corporation, the Corporation’s requirement that the Executive to be based at any office or location more
than fifty (50) miles from the Corporation’s headquarters in Petaluma, California; or

 

    	6

    	 

    

 

(iv) the failure
of the Corporation to obtain a satisfactory agreement from any successor to the Corporation to assume and agree to perform this
Agreement.

 

provided,
however, that none of the events specified in clause (i), (ii), or (iii) above shall constitute Good Reason unless the Executive
shall have notified the Corporation in writing describing the events which constitute Good Reason and the Corporation shall have
failed to cure such event within a reasonable period, not to exceed ten (10) business days, after the Corporation’s actual
receipt of such written notice.

 

(e) As used
herein, “Release” shall mean a written release, discharge and covenant not to sue entered into by the Executive
on behalf of himself, his descendants, dependents, heirs, executors, administrators, assigns, and successors, and each of them,
of and in favor of the Corporation, its parent (if any), the Corporation’s subsidiaries and affiliates, past and present,
and each of them, as well as its and their trustees, directors, officers, agents, attorneys, insurers, employees, shareholders,
members, representatives, assigns, and successors, past and present, and each of them (the “releasees”), with respect
to and from any and all claims, wages, demands, rights, liens, agreements, contracts, covenants, actions, suits, causes of action,
obligations, debts, costs, expenses, attorneys’ fees, damages, judgments, orders and liabilities of whatever kind or nature
in law, equity or otherwise, whether now known or unknown, suspected or unsuspected, and whether or not concealed or hidden, which
the Executive may then own or hold, or the Executive at any time theretofore owned or held, or may in the future hold as against
any or all of said releasees, arising out of or in any way connected with the Executive’s employment relationship with each
and every member of the Company Group (as defined in Section 7) with which the Executive has had such a relationship, or the termination
of his employment or any other transactions, occurrences, acts or omissions or any loss, damage or injury whatever, known or unknown,
suspected or unsuspected, resulting from any act or omission by or on the part of said releasees, or any of them, committed or
omitted prior to the date of such Release including, without limiting the generality of the foregoing, any claim under Section
1981 of the Civil Rights Act of 1866, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the
Americans with Disabilities Act, the Family and Medical Leave Act of 1993, the California Fair Employment and Housing Act, the
California Family Rights Act, any other claim under any other federal, state or local law or regulation, and any other claim for
severance pay, bonus or incentive pay, sick leave, holiday pay, vacation pay, life insurance, health or medical insurance or any
other fringe benefit, medical expenses, or disability (except that such Release shall not constitute a release of any Corporation
obligation to the Executive that may be due to the Executive pursuant to Section 5.3(b) upon the Corporation’s receipt of
such Release). The Release shall also contain the Executive’s representation and warranty that he has not theretofore assigned
or transferred to any other person or entity, other than the Corporation, any released matter or any part or portion thereof and
that he will defend, indemnify and hold harmless the Corporation and the aforementioned releasees from and against any claim (including
the payment of attorneys’ fees and costs actually incurred whether or not litigation is commenced) that is directly or indirectly
based on or in connection with or arising out of any such assignment or transfer made, purported or claimed.

 

(f)As
used herein, a “Change of Control” shall mean the occurrence of any of the following:

 

i.           
a sale, lease or other disposition of all or substantially all of the assets of the Corporation and its subsidiaries, taken
as a whole;

 

    	7

    	 

    

 

ii.           
any consolidation or merger of the Corporation with or into any other corporation or other person, or any other corporate
reorganization or transaction (including the acquisition of capital stock of the Corporation), whether or not the Corporation
is a party thereto, in which the stockholders of the Corporation immediately prior to such consolidation, merger, reorganization
or transaction, own capital stock and either:

 

 a. represent directly, or indirectly through one or more entities, less than fifty percent (50%) of the economic interests in or voting power of the Corporation or other surviving entity immediately after such consolidation, merger, reorganization or transaction; or

 

 b. do not directly, or indirectly through one or more entities, have the power to elect a majority of the entire board of directors of the Corporation or other surviving entity immediately after such consolidation, merger, reorganization or transaction; or

 

iii.           
any stock sale or other transaction or series of related transactions, whether or not the Corporation is a party thereto,
after giving effect to which in excess of fifty percent (50%) of the Corporation’s voting power is owned directly, or indirectly
though one or more entities, by any person and its “affiliates” or “associates” (as such terms are defined
in the rules adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended).

  

(g)For purposes of the
definition of “Change of Control”, the following definitions shall be applicable:

 

i.           
The term “person” shall mean any individual, corporation or other entity and any group as such term is used
in Section 13(d) (3) or 14(d) (2) of the Exchange Act.

 

ii.           
Any person shall be deemed to be the beneficial owner of any shares of capital stock of the Corporation:

 

 a. which that person owns directly whether or not of record, or

 

 b. which that person has the right to acquire pursuant to any agreement or understanding or upon exercise of conversion rights, warrants, or options, or otherwise, or

 

 c. which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (b) above, by an “affiliate” or “associate” (as defined in the rules of the Securities and Exchange Commission under the Securities Act of 1933, as amended) of that person, or

 

 d. which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (b) above), by any other person with which that person or his “affiliate” or “associate” (defined as aforesaid) has any agreement, arrangement, or understanding for the purpose of acquiring, holding, voting or disposing of capital stock of the Corporation.

 

    	8

    	 

    

 

iii.           
The outstanding shares of capital stock of the Corporation shall include shares deemed owned through application of clause
(ii) (b), (c), and (d) above, but shall not include any other shares which may be issuable pursuant to any agreement or upon exercise
of conversion rights, warrants or options, or otherwise, but which are not actually outstanding.

 

5.6 Resignation
From Boards and Committees. Upon or promptly following any termination of Executive’s employment with the Corporation,
the Executive agrees to resign, as of the date of such termination, from (i) each and every board of directors (or similar body,
as the case may be) of the Corporation and each of its affiliates on which the Executive may then serve, including, but not limited
to, the Board (and any committees thereof ), and (ii) each and every office of the Corporation and each of its affiliates that
the Executive may then hold, and all positions that he may have previously held with the Corporation and any of its affiliates.

 

5.7 Excise Tax Gross-Up.
During and after the Period of Employment with the Corporation, the Executive shall be entitled to the excise tax protections set
forth in Exhibit B hereto.

 

5.8Section 409A
of the Internal Revenue Code.

 

(a)This Agreement is
intended to comply with Section 409A of the Internal Revenue Code of 1986 (“Section 409A”) and shall be construed
and interpreted consistent with that intent. In the event that any payment or benefit payable under Section 5.3 of this Agreement
is not compliant with Section 409A and any taxes, penalties or interest are imposed on the Executive under Section 409A as a result
of such noncompliance (the “Section 409A Penalties”), the Corporation shall put the Executive in an after tax
economic position equivalent to the position the Executive would have been in without the imposition of such Section 409A Penalties.
The Executive shall notify the Corporation in writing of any claim by the Internal Revenue Service or state tax authorities that,
if successful, would require the payment of any such Section 409A Penalties or related state tax statutes. The Executive’s
right to be put in an equivalent after tax economic position is subject to the Executive providing such notification no later than
ten (10) business days after Executive is informed in writing of such claim. If the Corporation desires to contest such claim,
Executive shall (i) cooperate with the Corporation in good faith in order to effectively contest such claim and (ii) permit the
Corporation to participate in any proceedings relating to such claim. The Corporation shall control all proceedings taken in connection
with such contest; provided, however, that the Corporation shall bear and pay directly all costs and expenses (including additional
interest and penalties) incurred in connection with such contest. This section shall also apply to any taxes, penalties, or interest
imposed by any state that are calculated in a manner similar to taxes, penalties, or interest imposed by Section 409A(a)(1)(B),
including those amounts imposed by the California Revenue and Taxation Code (R&TC) Sections 17501 and 24601.

 

(b)If and to the
extent that any payment or benefit under this Agreement, or any plan or arrangement of the Corporation, is determined by the
Corporation to constitute “non-qualified deferred compensation” subject to Section 409A and is payable to the
Executive by reason of the Executive’s termination of employment, then (a) such payment or benefit shall be made or
provided to the Executive only upon a “separation from service” as defined for purposes of Section 409A under
applicable regulations (a “Separation from Service”) and (b) if the Executive is a “specified
employee” (within the meaning of Section 409A and as determined by the Corporation), such payment or benefit shall not
be made or provided before the date that is six (6) months after the date of the Executive’s Separation from Service
(or the Executive’s earlier death). For the purposes of clarity, the first payment thereof will include a catch-up
payment covering the amount that would have otherwise been paid to the Executive during the period between the termination of
Executive’s employment and the first payment date but for the application of this provision, and the balance of the
installments (if any) will be payable in accordance with their original schedule.

 

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(c)To the extent any
expense reimbursement or in-kind benefit is determined to be subject to Section 409A, the amount of any such expenses eligible
for reimbursement or in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or
in-kind benefits provided in any other taxable year (except under any lifetime limit applicable to expenses for medical care),
in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive
incurred such expenses, and in no event shall any right to reimbursement or in-kind benefits be subject to liquidation or exchange
for another benefit.

 

(d)To the extent that
any provision of this Agreement is ambiguous as to its compliance with Section 409A, the provision will be read in such a manner
so that all payments hereunder comply with Section 409A. To the extent any payment under this Agreement may be classified as a
“short-term deferral” within the meaning of Section 409A, such payment shall be deemed a short-term deferral, even
if it may also qualify for an exemption from Section 409A under another provision of Section 409A. Payments pursuant to this section
are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.

 

6. Means and Effect of Termination.
Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination
from the terminating party to the other party. The notice of termination shall indicate the specific provision(s) of this Agreement
relied upon in effecting the termination.

 

7. Non-Competition. The Executive
acknowledges and recognizes the highly competitive nature of the businesses of the Corporation, the amount of sensitive and confidential
information involved in the discharge of the Executive’s position with the Corporation, and the harm to the Corporation that
would result if such knowledge or expertise was disclosed or made available to a competitor. Based on that understanding, the Executive
hereby expressly agrees as follows:

 

(a)As a result of the
particular nature of the Executive’s relationship with the Corporation, in the capacities identified earlier in this Agreement,
for the Period of Employment, the Executive hereby agrees that he will not, directly or indirectly, (i) engage in any business
for the Executive’s own account or otherwise derive any personal benefit from any business that competes with the business
of the Corporation or any of its affiliates (the Corporation and its affiliates are referred to, collectively, as the “Company
Group”), (ii) enter the employ of, or render any services to, any person engaged in any business that competes with the
business of any entity within the Company Group, (iii) acquire a financial interest in any person engaged in any business that
competes with the business of any entity within the Company Group, directly or indirectly, as an individual, partner, member, shareholder,
officer, director, principal, agent, trustee or consultant, or (iv) interfere with business relationships (whether formed before
or after the Effective Date) between the Corporation, any of its respective affiliates or subsidiaries, and any customers, suppliers,
officers, employees, partners, members or investors of any entity within the Company Group. For purposes of this Agreement, businesses
in competition with the Company Group shall include, without limitation, businesses which any entity within the Company Group may
conduct operations, and any businesses which any entity within the Company Group has specific plans to conduct operations in the
future and as to which the Executive is aware of such planning, whether or not such businesses have or have not as of that date
commenced operations.

 

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(b) Notwithstanding
anything to the contrary in this Agreement, the Executive may, directly or indirectly, own, solely as an investment, securities
of any Person which are publicly traded on a national or regional stock exchange or on the over-the-counter market if the Executive
(i) is not a controlling Person of, or a member of a group that controls, such Person, and (ii) does not, directly or indirectly,
beneficially own one percent (1%) or more of any class of securities of such Person. For purposes of this Section 7(b), “Person”
shall have the meaning ascribed to such terms in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including a “group” as described in Section 13(d) thereof.

 

8. Confidentiality. As a material
part of the consideration for the Corporation’s commitment to the terms of this Agreement, the Executive hereby agrees that
the Executive will not at any time (whether during or after the Executive’s employment with the Corporation), other than
in the course of the Executive’s duties hereunder, or unless compelled by lawful process after written notice to the Corporation
of such notice along with sufficient time for the Corporation to try and overturn such lawful process, disclose or use for the
Executive’s own benefit or purposes or the benefit or purposes of any other person, firm, partnership, joint venture, association,
corporation or other business organization, entity or enterprise, any trade secrets, or other confidential data or information
relating to customers, development programs, costs, marketing, trading, investment, sales activities, promotion, credit and financial
data, financing methods, or plans of any entity within the Company Group; provided, however, that the foregoing shall
not apply to information which is generally known to the industry or the public, other than as a result of the Executive’s
breach of this covenant. The Executive further agrees that the Executive will not retain or use for his own account, at any time,
any trade names, trademark or other proprietary business designation used or owned in connection with the business of any entity
within the Company Group.

 

9. Inventions and Developments.

 

(a) All inventions,
policies, systems, developments or improvements conceived, designed, implemented and/or made by the Executive, either alone or
in conjunction with others, at any time or at any place during the Period of Employment, whether or not reduced to writing or practice
during such Period of Employment, which directly or indirectly relate to the business of any entity within the Company Group, or
which were developed or made in whole or in part using the facilities and/or capital of any entity within the Company Group, shall
be the sole and exclusive property of the Company Group. The Executive shall promptly give notice to the Corporation of any such
invention, development, patent or improvement, and shall at the same time, without the need for any request by any person or entity
within the Company Group, assign all of the Executive’s rights to such invention, development, patent and/or improvement
to the Company Group. The Executive shall sign all instruments necessary for the filing and prosecution of any applications for,
or extensions or renewals of, letters patent of the United States or any foreign country that any entity in the Company Group desires
to file.

 

(b) All copyrightable
work by the Executive during the Period of Employment that relates to the business of any entity in the Company Group is intended
to be “work made for hire” as defined in Section 101 of the Copyright Act of 1976, and shall be the property of the
Company Group. If the copyright to any such copyrightable work is not the property of the Company Group by operation of the law,
the Executive will, without further consideration, assign to the Company Group all right, title and interest in such copyrightable
work and will assist the entities in the Company Group and their nominees in every way, at the Company Group’s expense, to
secure, maintain and defend for the Company Group’s benefit, copyrights and any extensions and renewals thereof on any and
all such work including translations thereof in any and all countries, such work to be and to remain the property of the Company
Group whether copyrighted or not.

 

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10. Anti-Solicitation. In light
of the amount of sensitive and confidential information involved in the discharge of the Executive’s duties, and the harm
to the Corporation that would result if such knowledge or expertise were disclosed or made available to a competitor, and as a
reasonable step to help protect the confidentiality of such information, the Executive promises and agrees that during the Period
of Employment and for a period of two (2) years thereafter, the Executive will not, directly or indirectly, individually or as
a consultant to, or as an employee, officer, shareholder, director or other owner or participant in any business, influence or
attempt to influence the customers, vendors, suppliers, joint venturers, associates, consultants, agents, or partners of any entity
within the Company Group, either directly or indirectly, to divert their business away from the Company Group, to any individual,
partnership, firm, corporation or other entity then in competition with the business of any entity within the Company Group, and
he will not otherwise materially interfere with any business relationship of any entity within the Company Group.

 

11. Soliciting Employees. In light
of the amount of sensitive and confidential information involved in the discharge of the Executive’s duties, and the harm
to the Corporation that would result if such knowledge or expertise were disclosed or made available to a competitor, and as a
reasonable step to help protect the confidentiality of such information, the Executive promises and agrees that during the Period
of Employment and for a period of two (2) years thereafter, the Executive will not, directly or indirectly, individually or as
a consultant to, or as an employee, officer, shareholder, director, or other owner of or participant in any business, solicit (or
assist in soliciting) any person who is then, or at any time within six (6) months prior thereto was, an employee of an entity
within the Company Group, who earned annually $25,000 or more as an employee of such entity during the last six (6) months of his
or her own employment to work for (as an employee, consultant or otherwise) any business, individual, partnership, firm, corporation,
or other entity whether or not engaged in competitive business with any entity in the Company Group.

 

12. Return of Property. The Executive
agrees to truthfully and faithfully account for and deliver to the Corporation all property belonging to the Corporation, any other
entity in the Company Group, or any of their respective affiliates, which the Executive may receive from or on account of the Corporation,
any other entity in the Company Group, or any of their respective affiliates, and upon the termination of the Period of Employment,
or the Corporation’s demand, the Executive shall immediately deliver to the Corporation all such property belonging to the
Corporation, any other entity in the Company Group, or any of their respective affiliates.

 

13. Withholding Taxes. Notwithstanding
anything else herein to the contrary, the Corporation may withhold (or cause there to be withheld, as the case may be) from any
amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other
taxes as may be required to be withheld pursuant to any applicable law or regulation.

 

14. Cooperation in Litigation. The
Executive agrees that, during the Period of Employment or after the termination of the Executive’s employment, he will reasonably
cooperate with the Corporation, subject to his reasonable personal and business schedules, in any litigation which arises out of
events occurring prior to the termination of his employment, including but not limited to, serving as a witness or consultant and
producing documents and information relevant to the case or helpful to the Corporation. The Corporation agrees to reimburse the
Executive for all reasonable costs and expenses he incurs in connection with his obligations under this Section 14 and, in addition,
to reasonably compensate the Executive for time actually spent in connection therewith following the termination of his employment
with the Corporation.

 

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15. Assignment. This Agreement is
personal in its nature and neither of the parties hereto shall, without the consent of the other, assign or transfer this Agreement
or any rights or obligations hereunder; provided, however, that in the event of a merger, consolidation, or transfer
or sale of all or substantially all of the assets of the Corporation with or to any other individual(s) or entity, this Agreement
shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge
and perform all the promises, covenants, duties, and obligations of the Corporation hereunder.

 

16. Number and Gender. Where the
context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all
other genders.

 

17. Section Headings. The section
headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purposes of convenience only,
and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.

 

18. Governing Law. This Agreement,
and all questions relating to its validity, interpretation, performance and enforcement, as well as the legal relations hereby
created between the parties hereto, shall be governed by and construed under, and interpreted and enforced in accordance with,
the laws of the State of California, notwithstanding any California or other conflict of law provision to the contrary. This Agreement
is intended to comply with Section 409A of the Internal Revenue Code of 1986 and the regulations promulgated thereunder.

 

19. Severability. If any provision
of this Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications
of this Agreement which can be given effect without the invalid provisions or applications and to this end the provisions of this
Agreement are declared to be severable.

 

20. Entire Agreement. This Agreement
replaces and supersedes prior employment agreements, including the employment agreement executed by and between the Executive and
the Corporation dated January 1, 2004. This Agreement embodies the entire agreement of the parties hereto respecting the matters
within its scope. Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter
hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence,
agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties,
or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set
forth herein.

 

21. Modifications. This Agreement
may not be amended, modified or changed (in whole or in part), except by a formal definitive written agreement expressly referring
to this Agreement, which agreement is executed by both of the parties hereto.

 

22. Waiver. Neither the failure
nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege
with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence.
No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

 

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23. Resolution of Disputes.

 

(a)Any controversy
arising out of or relating to the Executive’s employment (whether or not before or after the expiration of the Period of
Employment), any termination of the Executive’s employment, this Agreement or the enforcement or interpretation of this Agreement,
or because of an alleged breach, default, or misrepresentation in connection with any of the provisions of this Agreement, including
(without limitation) any state or federal statutory claims, shall be submitted to arbitration in Santa Rosa, California, before
a sole arbitrator (the “Arbitrator”) selected from judicial arbitration mediation services (“JAMS”),
or if JAMS is no longer able to supply the arbitrator, such arbitrator shall be selected from the American Arbitration Association
(“AAA”), and shall be conducted in accordance with the provisions of California Code of Civil Procedure §§
1280 et seq. as the exclusive remedy of such dispute; provided, however, that provisional injunctive
relief may, but need not, be sought in a court of law while arbitration proceedings are pending, and any provisional injunctive
relief granted by such court shall remain effective until the matter is finally determined by the Arbitrator. Final resolution
of any dispute through arbitration may include any remedy or relief that the Arbitrator deems just and equitable, including any
and all remedies provided by applicable state or federal statutes. At the conclusion of the arbitration, the Arbitrator shall issue
a written decision that sets forth the essential findings and conclusions upon which the Arbitrator’s award or decision is
based. Any award or relief granted by the Arbitrator hereunder shall be final and binding on the parties hereto and may be enforced
by any court of competent jurisdiction.

 

(b) The parties acknowledge
and agree that they are hereby waiving any rights to trial by jury in any action, proceeding or counterclaim brought by either
of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with any of the
matters referenced in the first sentence of Section 23(a).

 

(c) The parties agree
that the Corporation shall be responsible for payment of the forum costs of any arbitration hereunder, including the Arbitrator’s
fee. The parties further agree that in any proceeding with respect to such matters, the prevailing party will be entitled to recover
its reasonable attorney’s fees and costs from the non-prevailing party (other than forum costs associated with the arbitration
which in any event shall be paid by the Corporation).

 

(d) Without limiting
the remedies available to the parties and notwithstanding the foregoing provisions of this Section 23, the Executive and the Corporation
acknowledge that any breach of any of the covenants or provisions contained in Sections 5.6, and 7 through 12 could result in irreparable
injury to either of the parties hereto for which there might be no adequate remedy at law, and that, in the event of such a breach
or threat thereof, the non-breaching party shall be entitled to obtain a temporary restraining order and/or a preliminary injunction
and a permanent injunction restraining the other party hereto from engaging in any activities prohibited by any covenant or provision
in Sections 5.6, and 7 through 12 or such other equitable relief as may be required to enforce specifically any of the covenants
or provisions of Sections 5.6, and 7 through 12.

 

24. Notices.

 

(a) All notices, requests,
demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been
duly received if (i) delivered by hand or by courier, effective upon delivery, (ii) given by facsimile or electronic version, when
transmitted if transmitted on a business day and during normal business hours of the recipient, and otherwise delivered on the
next business day following transmission, or (iii) sent by registered or certified mail, postage prepaid, return receipt requested,
five (5) business days after being deposited in the U.S. postal mail. Any notice shall be duly addressed to the parties as follows:

 

    	14

    	 

    

 

(i) If to the Corporation:

 

Oculus Innovative Sciences, Inc.

1129 North McDowell Boulevard

Petaluma, California 94954

Attn: General Counsel

Fax: +1 (707) 283-0551

 

(ii) If to the Executive:

 

Jim Schutz

At the address on file with the Corporation

 

(b) Any party may alter
the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the
provisions of this Section 24 for the giving of notice.

 

25. Legal Counsel; Mutual Drafting.
Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to
consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement.
Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that
party being the drafter of such language.

 

26. Provisions that Survive Termination.
The provisions of 5.3, 5.4, 5.5, 5.6, 5.7, 5.8, 7 through 25, 27, and this Section 26 shall survive any termination of the Period
of Employment.

 

27. Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears
thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the
signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the Corporation and
the Executive have executed this Agreement as of the Effective Date.

  

	 	CORPORATION
	 	 
	 	Oculus Innovative Sciences, Inc.,
	 	a Delaware corporation
	 	 
	 	By:	/s/ Greg French
	 	Name:

        Title:
	Greg French
Chairman of the Compensation Committee of
	 	 	Oculus Innovative Sciences, Inc.
	 	 	 
	 	 	 
	 	EXECUTIVE
	 	 	 
	 	By:	/s/ Jim Schutz
	 	Name:	Jim Schutz

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A — SECTION 1.3 DISCLOSURE
SCHEDULE

 

None.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	17

    	 

    

 

EXHIBIT B — SECTION 5.7 EXCISE TAX GROSS-UP 

 

B.1 Equalization Payment.
If any payment, distribution, transfer, or benefit (including, without limitation, any amounts received or deemed received by the
Executive within the meaning of any provision of the Internal Revenue Code of 1986, as amended (the “Code”),
or by the Executive as a result of (and not by way of limitation) any automatic vesting, lapse of restrictions and/or accelerated
target or performance achievement provisions, or otherwise, applicable to outstanding grants or awards to the Executive under any
of the Corporation’s incentive plans) by the Corporation or a successor, or by a direct or indirect subsidiary or affiliate
of the Corporation (or any successor or affiliate of any of them, and including any benefit plan of any of them), whether paid
or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (collectively, the “Total
Payments”), is subject to the excise tax imposed under Section 4999 of the Code or any similar or successor tax (the
“Excise Tax”), the Corporation shall pay in cash to Executive an additional amount (the “Gross-Up Payment”)
such that the net amount retained by the Executive after the deduction of any Excise Tax upon the Gross-Up Payment(s) provided
for by this Section B.l shall be equal to such Total Payments had they not been subject to the Excise Tax. Such Gross-Up Payment
shall be paid by the Corporation, according to the terms of this Agreement, to the Executive by the end of the taxable year following
the taxable year in which the Executive pays the Excise Tax.

 

B.2 Calculation of Gross-Up Payment.
The determination of whether a Gross-Up Payment is required pursuant to this Exhibit B and the amount of any such Gross-Up Payment
shall be determined in writing (the “Determination”) by a nationally-recognized certified public accounting
firm selected by the Corporation (the “Accounting Firm”). The Accounting Firm shall provide its Determination
in writing, together with detailed supporting calculations and documentation and any assumptions used in making such computation,
to the Corporation and the Executive. In the event of a termination of the Executive’s employment which reasonably may require
the payment of a Gross-Up Payment or in the event of a Change in Control, such documentation shall be provided no later than twenty
(20) days following such event. Within twenty (20) days following delivery of the Accounting Firm’s Determination, the Executive
shall have the right, at the Corporation’s expense, to obtain the opinion of an “outside counsel,” which opinion
need not be unqualified, which sets forth: (i) the amount of the Executive’s “annualized includible compensation for
the base period” (as defined in Section 280G(d)(1) of the Code); (ii) the present value of the Total Payments made to the
Executive; (iii) the amount and present value of any “excess parachute payment” as such term is defined in the Code;
and (iv) detailed supporting calculations and documentation and any assumptions used in making such computations. The opinion of
such outside counsel shall be supported by the opinion of a nationally-recognized certified public accounting firm and, if necessary
or required by the Corporation, a firm of nationally-recognized executive compensation consultants. The Executive shall also have
the right to obtain such an opinion of outside counsel in the event that the Corporation has not timely submitted the initial determination
to the Accounting Firm as provided above (including, without limitation, in the event that the Corporation does not submit such
a determination to the Accounting Firm following an event in connection with which the Executive reasonably believes that he may
be entitled to a Gross-Up Payment). The outside counsel’s opinion shall be binding upon the Corporation and the Executive
and shall constitute the “Determination” for purposes of this Exhibit B instead of the initial determination by the
Accounting Firm. The Corporation shall pay (or, to the extent paid by the Executive, reimburse the Executive for) the certified
public accounting firm’s and, if applicable, the executive compensation consultant’s reasonable and customary fees
for rendering such opinion. For purposes of this Section B.2, “outside counsel” means a licensed attorney selected
by the Executive who is recognized in the field of executive compensation and has experience with respect to the calculation of
the Excise Tax; provided that the Corporation must approve the Executive’s selection, which approval shall not be unreasonably
withheld.

 

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B.3 Computation Assumptions.
For purposes of determining whether any Total Payments will be subject to Excise Tax, and the amount of any such Excise Tax:

 

		(a)	Any other payments, benefits and/or amounts received or to be received by the Executive in connection
with or contingent upon any change in the ownership or effective control of the Corporation or any change in the ownership of a
substantial portion of the Corporation’s assets or termination of the Executive’s employment (whether pursuant to the
terms of this Agreement or any other plan, arrangement or agreement with the Corporation, or with any Person (as defined below)
whose actions result in such a change or any Person (as defined below) affiliated with the Corporation or such Persons (as defined
below)) shall be combined to determine whether the Executive has received any “parachute payment” within the meaning
of Section 280G(b)(2) of the Code, and if so, the amount of any “excess parachute payments” within the meaning of Section
280G(b)(1) that shall be treated as subject to the Excise Tax, unless in the opinion of the person or firm rendering the Determination,
such other payments, benefits and/or amounts (in whole or in part) do not constitute “parachute payments” within the
meaning of Section 280G(b)(2) of the Code, or such excess parachute payments represent reasonable
compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the base amount within
the meaning of Section 280G(b)(3) of the Code, or are otherwise not subject to the Excise Tax. For purposes of this Section B.3(a),
“Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections
13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof);

 

		(b)	The value of any non-cash benefits or any deferred payment or benefit shall be determined by the
person or firm rendering the Determination in accordance with the principles of Sections 280G(d)(3) and (4) of the Code;

 

		(c)	The compensation and benefits provided for in Section 5 of this Agreement, and any other compensation
earned prior to the termination of the Executive’s employment pursuant to the Corporation’s compensation programs (if
such payments would have been made in the future in any event, even though the timing of such payment is triggered by a change
in the ownership or effective control of the Corporation or any change in the ownership of a substantial portion of the Corporation’s
assets or a termination of the Executive’s employment), shall for purposes of the calculation pursuant to this Section B.3
be deemed to be reasonable; and

 

		(d)	The Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal
income taxation in the calendar year in which the Gross-Up Payment is to be made. Furthermore, the computation of the Gross-Up
Payment shall assume (and adjust for the fact) that (i) there is a loss of miscellaneous itemized deductions under Section 67 of
the Code (or analogous federal or state provisions) on account of the Gross-Up Payment, and (ii) a loss of itemized deductions
under Section 68 of the Code (or analogous federal or state provisions) on account of the Gross-Up Payment. The computation of
the Gross-Up Payment shall take into account any reduction in the Gross-Up Payment due to the Executive’s share of the hospital
insurance portion of FICA and any state withholding taxes (other than any state withholding tax for income tax liability). The
computation of the state and local income taxes applicable to the Gross-Up Payment shall be based on the highest marginal rate
of taxation in the state and locality of the Executive’s residence on the date the Executive’s employment terminates,
and shall take into account the maximum reduction in federal income taxes that could be obtained from the deduction of such state
and local taxes.

 

		(e)	It is the intent of the parties that the amounts payable under this Agreement, and the Corporation’s
and the Executive’s exercise of authority or discretion hereunder shall comply with and avoid the imputation of any tax,
penalty, or interest under Section 409A of the Code. This Agreement and this Exhibit B shall be construed in interpretation with
that intent.

 

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B.4 Executive’s Obligation
to Notify Corporation. The Executive shall promptly notify the Corporation in writing of any claim by the Internal Revenue
Service (or any successor thereof) or any state or local taxing authority (individually or collectively, the “Taxing Authority”)
that, if successful, would require the payment by the Corporation of a Gross-Up Payment in excess of any Gross-Up Payment as originally
set forth in the Determination. If the Corporation notifies the Executive in writing that it desires to contest such claim, the
Executive shall: (a) give the Corporation any information reasonably requested by the Corporation relating to such claim; (b) take
such action in connection with contesting such claim as the Corporation shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with respect to such claim by an attorney selected by the Corporation
that is reasonably acceptable to the Executive; (c) cooperate with the Corporation in good faith in order to effectively contest
such claim; and (d) permit the Corporation to participate in any proceedings relating to such claim; provided that the Corporation
shall bear and pay directly all attorneys’ fees, costs and expenses (including additional interest, penalties and additions
to tax) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for
all taxes (including, without limitation, income and excise taxes), interest, penalties and additions to tax imposed in relation
to such claim and in relation to the payment of such costs and expenses or indemnification. Without limitation on the foregoing
provisions of this Section B.4, and to the extent its actions do not unreasonably interfere with or prejudice the Executive’s
disputes with the Taxing Authority as to other issues, the Corporation shall control all proceedings taken in connection with such
contest and, in its reasonable discretion, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences
with the Taxing Authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax, interest
or penalties claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute
such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Corporation shall determine; provided, however, that if the Corporation directs Executive to pay such claim and
sue for a refund, the Corporation shall advance an amount equal to such payment to the Executive, on an interest-free basis, and
shall indemnify and hold the Executive harmless, on an after-tax basis, from all taxes (including, without limitation, income and
excise taxes), interest, penalties and additions to tax imposed with respect to such advance or with respect to any imputed income
with respect to such advance, as any such amounts are incurred; and, further, provided, that any extension of the statute of limitations
relating to payment of taxes, interest, penalties or additions to tax for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested amount; and, provided, further, that any settlement
of any claim shall be reasonably acceptable to the Executive and the Corporation’s control of the contest shall be limited
to issues with respect to which a Gross-Up Payment would be payable hereunder, and the Executive shall be entitled to settle or
contest, as the case may be, any other issue.

 

B.5 Subsequent Recalculation.
In the event of a binding or uncontested determination by the Taxing Authority that adjusts the computation set forth in the Determination
so that the Executive did not receive the greatest net benefit required pursuant to Section B.1, the Corporation shall reimburse
the Executive as provided herein for the full amount necessary to place the Executive in the same after-tax position as he would
have been in had no Excise Tax applied. In the event of a binding or uncontested determination by the Taxing Authority that adjusts
the computation set forth in the Determination so that the Executive received a payment or benefit in excess of the amount required
pursuant to Section B.1, then the Executive shall promptly pay to the Corporation (without interest) the amount of such excess.

 

 

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