Document:

LICENSE AND PROMOTION AGREEMENT

 

by and between

 

MARTHA STEWART LIVING OMNIMEDIA, INC.

 

and 

 

Inergetics,
inc.

 

Dated

 

May 7, 2013

 

    	 

    	 

    

 

LICENSE AND PROMOTION AGREEMENT

 

THIS AGREEMENT (the “Agreement”)
entered into on April 10, 2013, but effective as of this 7th day of May 2013, by and between Martha Stewart Living Omnimedia,
Inc. (“MSLO”), a Delaware corporation with its principal place of business at 601 West 26th Street, New York,
New York 10001, and Inergetics, Inc., a Delaware corporation and Millennium Biotechnologies, Inc., a wholly-owned subsidiary of
Inergetics, Inc., (Inergetics, Inc. and Millennium Biotechnologies, Inc., collectively, “Licensee”), with their
principal place of business at 205 Robin Road, Suite 222 Paramus, NJ 07652 (each of MSLO and Licensee, a “Party”
or “Parties”).

 

WITNESSETH:

 

WHEREAS, MSLO desires to license to Licensee,
and Licensee desires to license from MSLO, the limited rights to use the Licensed Property (as defined below) in connection with
the development of supplements; and

 

WHEREAS, MSLO and Licensee intend that the
Licensed Products (as defined below) be advertised and promoted as part of a coordinated program associated with the Licensed Property.

 

NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

1.           Definitions.  The following terms shall have the following meanings:

 

“Advance” has the meaning
set forth in Section 10(a).

 

“Advertising Materials”
means consumer and trade advertising, marketing and publicity materials for promoting the Licensed Products.

 

“Advertising Strategy”
means social and digital marketing, fixtures, trade shows, co-op, trade, national, and local consumer advertising and promotion
strategies, and couponing and redemptions to promote the Licensed Products. Couponing and redemptions may account for no more than
fifty (50%) percent of the annual advertising and marketing spend.

 

“Affiliate” means, with
respect to a Party, any entity that controls, is controlled by, or is under common control with, such Party.

 

“Agreement Year” means,     {***}

 

“Approved Retailers”
means those retailers listed on Schedule 5, as amended from time to time as mutually agreed upon by the parties.

 

“Brand Guidelines” has
the meaning set forth in Section 9(b).

 

“Business” has the meaning
set forth in Section 9(b).

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.

 

    	 

    	 

    

 

“Celebrity Branded” means
branding associated with any celebrity, individual, entity, publication, television program or brand associated with home décor,
cooking, crafts, gardening, lifestyle or how-to, including, without limitation, Oprah Winfrey, Rachael Ray, Ina Garten (including
Barefoot Contessa), Ellen DeGeneres, Ralph Lauren, Tommy Hilfiger, Jonathan Adler, Real Simple, and Rosie O’Donnell. Notwithstanding
the foregoing, Celebrity Branded shall not include branding associated with sports and fitness personalities.

 

“Claim” has the meaning
set forth in Section 15(a).

 

“Comparable Products”
means other designer or celebrity-branded products or other similar non-branded products manufactured, distributed or sold by Licensee,
if any.

 

“Competitive Product”
means any product within a Product Category if the branding or endorsement for such product is Celebrity Branded.

 

“Consumer Facings” means
in-store displays, fixtures, signage and layouts for use in connection with the Licensed Products.

 

“Creative Services” has
the meaning set forth in Section 9(a).

 

“Creative Services Proposal”
has the meaning set forth in Section 9(a).

 

“Design Direction” has
the meaning set forth in Section 4(a).

 

“Designated Brand Manager”
means the individual designated by Licensee in writing to be the brand manager dedicated to the Licensed Products.

 

“Development Calendar”
means the development calendar for the development, approval, and launch of the initial Licensed Product(s), attached hereto as
Schedule 1. (If such schedule is not attached, then Licensee agrees to provide MSLO with such schedule within 60 days of
the date hereof.) Such Development Calendar will have time frames consistent with industry standards and shall be geared to maximizing
sales of the Licensed Products (i.e. ensuring that seasonal sales windows are not missed).

 

“Distribution Channel”
means drugstores, food stores, natural health stores and mass retailers, direct-to-consumer, including, internet sales, HSN, warehouse
clubs, and big box stores. The specific retailers in each channel shall be listed on Schedule 5 Approved Retailers.

 

“Exploitation Activities”
has the meaning set forth in Section 9(b).

 

“Exploitation Materials”
has the meaning set forth in Section 5(b).

 

“Forecast” has the meaning
set forth in Section 8(b)(ii).

 

“Innovations” has the
meaning set forth in Section 4(e).

 

“Intellectual Property”
has the meaning set forth in Section 12(g).

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

  

    	-2-

    	 

    

 

“Launch” means to the
trade, no later than {***}.

 

“Licensed Products” means
the products within the Product Category that are (i) manufactured and distributed by Licensee and its MSLO approved contract
manufacturers (which approved manufacturers are listed on Schedule 6 attached hereto as amended from time to time by mutual
consent of the parties) pursuant to this Agreement, (ii) approved by MSLO pursuant to this Agreement, and (iii) marketed by the
Parties pursuant to this Agreement.

 

“Licensed Property” has
the meaning set forth in Section 2(a).

 

“Licensee Claim” has
the meaning set forth in Section 15(a).

 

“Licensee Insurance”
has the meaning set forth in Section 16.

 

“Licensing Fee” has the
meaning set forth in Section 10(b).

 

“MSLO Approval Representative”
means the person designated by MSLO from time to time to receive and process MSLO approvals pursuant to this Agreement. Initially,
the MSLO Approval Representative shall be the SVP of Licensing.

 

“MSLO Claim” has the
meaning set forth in Section 15(b).

 

“MSLO License” means
any license or other agreement pursuant to which MSLO grants or has granted a third party rights to use a trademark, brand or other
intellectual property owned by MSLO, excluding this Agreement.

 

“MSLO Materials” has
the meaning set forth in Section 12(g).

 

“MSLO Outlets” means
any retail outlets owned or controlled by MSLO or any Affiliate or through any retail outlets branded with the Trademark or a trademark
incorporating the name Martha Stewart in which MSLO or any of its Affiliates has an ownership interest or a website that is branded
with the Trademark or a trademark incorporating the name “Martha Stewart,” as determined by MSLO in its sole discretion.
A website that functions as an MSLO Outlet may be hosted or managed by a third-party.

 

“Marketing Spend” has
the meaning set forth in Section 9(d).

 

“Minimum Guaranteed Annual Royalty”
has the meaning set forth in Section 10(c).

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

  

    	-3-

    	 

    

 

“Net Sales” means, with
respect to a particular time period, all gross consideration invoiced or received by or accrued to Licensee
from the sale of Licensed Products, including, without limitation, all gross invoice amounts
billed by Licensee to customers (“Gross Sales”), minus (a) actual sales and excise taxes applicable to
sales of the Licensed Property and (b) all returns and allowances actually made or allowed by Licensee
(as supported by credit memos issued to customers), except for those returns based on damaged, defective or recalled Licensed
Products, consistent with Section 5(f); provided, however, that in no event shall deductions for returns and allowances
{***}. No costs incurred in the manufacture, sale, advertising or distribution of Licensed
Products, or any indirect expenses, or any other deduction not expressly provided for above may be deducted. Gross Sales shall
reflect all consideration, in whatever form, that Licensee invoices or receives or that otherwise accrues to Licensee on account
of such Licensed Product. With respect to Net Sales of Licensed
Products by Licensee to any wholesaler or to any retailer or other party in which Licensee maintains any proprietary interest,
Gross Sales shall be deemed to be the greater of the consideration invoiced or received by or accrued to Licensee from such sale
or the consideration that Licensee would have invoiced or received or that would have accrued to Licensee in an arm’s length
transaction with an independent retailer. With respect to sales of Licensed Products in a currency
other than United States Dollars, Net Sales shall be computed on the basis of the average of the conversion rates of such currency
into United States Dollars quoted in The Wall Street Journal as of the close of business on the last business day of each
month during each applicable accounting and payment period.

 

“Packaging Materials”
means the labels, tags and packaging used on or in connection with the Licensed Products.

 

“Product Category” means
nutritional supplement capsules.

 

“Projections” has the
meaning set forth in Section 8(b)(i).

 

“Quarter” means each
calendar quarter during the Term commencing in the calendar quarter in which the Initial Launch Date occurs.

 

“Quarterly Reports” has
the meaning set forth in Section 10(d).

 

“Royalty” has the meaning
set forth in Section 10(b).

 

“Subsequent Agreement”
has the meaning set forth in Section 3(b)(i).

 

“Subsequent Negotiation Period”
has the meaning set forth in Section 3(b)(i).

 

“Territory” means the
United States and its territories

 

“Term” has the meaning
set forth in Section 3(a).

 

“Trademark” has the meaning
set forth in Section 2(a).

 

2.           Grant;
Exclusivity.

 

(a)          Subject
to the terms and conditions of this Agreement, MSLO hereby grants Licensee a limited, non-transferable, right and license in the
Territory and during the Term to use the trademark MARTHA STEWART NATURALS(“Trademark”) or such other trademark
as MSLO may designate in writing and variations and stylized forms thereof designated by MSLO (the “Licensed Property”),
which shall be approved in the manner set forth herein, solely in connection with (x) the manufacture, packaging, distribution,
marketing and sale of the Licensed Products through the Distribution Channel and (y) the manufacture, distribution, and exploitation
of the Exploitation Materials approved by MSLO in furtherance of the sale of the Licensed Products. Licensee shall not have any
rights in or to the name “Martha Stewart” other than in connection with its use of
the Trademark as set forth in this Agreement. Any sale or exploitation of the Licensed Products, the Product Category, or use
of the Licensed Property by or on behalf of Licensee in a manner not expressly permitted hereunder shall be deemed a material
breach of this Agreement.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-4-

    	 

    

 

(b)          Restriction
on MSLO. Subject to MSLO’s rights pursuant to Sections 2(d), neither MSLO nor any of its Affiliates shall authorize third
parties to, manufacture, package, distribute or sell any products in the Product Category in the Territory that use or exploit
the Licensed Property.

 

(c)          Reservation
of Rights. MSLO reserves and retains for itself any and all rights in and to the Trademark that are not expressly granted herein.
Licensee further agrees and acknowledges that MSLO is engaged in a wide range of media and merchandising businesses, and that other
than as set forth in Section 2(b) nothing contained in this Agreement shall restrict MSLO from pursuing current or future opportunities
relating to such businesses.

 

(d)          Sales
of Licensed Products Through MSLO Outlets. MSLO shall have the right to distribute, promote or sell Licensed Products through
any MSLO Outlets. If MSLO exercises this right, Licensee shall provide the License Products to MSLO at {***} of
wholesale cost (“Wholesale Discounted Price”). If the MSLO Outlet is physically located within an Approved Retailer
or is the subdomain of an Approved Retailer’s website, Licensee shall provide the Licensed Products to MSLO at the full wholesale
price. MSLO shall receive an {***} % Royalty on such sales as it would be entitled
to the sales been made to the Approved Retailer.

 

(e)          Notwithstanding
the exclusive nature of the license granted pursuant to Sections 2(a) and 2(b), if Licensee has not maintained a {***} percent
fill rate on orders of the Product Category within any rolling twelve (12) month period during the Term, the rights granted in
this Agreement with respect to the Product Category shall revert to MSLO. Licensee acknowledges that upon such reversion, the applicable
product or Product Category will no longer be subject to the license grant or any other restrictions contained in this Agreement.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-5-

    	 

    

 

3.           Term
and Territory.

 

(a)          Initial
Term. This Agreement shall become effective on the date that both Parties have executed this Agreement and shall expire upon
the {***} to occur of (i) {***} or (ii)
the termination of this Agreement by either Party pursuant to the terms of this Agreement (such total time period, the “Term”),
unless such Term is extended as provided herein.

 

(b)          Extension
of Term.

 

(i)          If
Licensee would like to enter into a new license agreement that would commence immediately after the end of the Term (a “Subsequent
Agreement”), Licensee shall provide MSLO with written notice of such intent no later than {***}.
To the extent that: (i) Licensee has not breached this Agreement in any material respect; and (ii) Licensee has timely paid actual
royalties equal to or in excess of the Aggregate Minimum Annual Royalties due for Agreement Year {***}
and any payments due during Year {***} up to {***},
MSLO and Licensee shall negotiate, in good faith, the terms and conditions as may be mutually agreed upon by the Parties for a
Subsequent Agreement. Such negotiation period shall begin on {***} and end no later
than {***} (the “Subsequent Negotiation Period”). If the Parties
are unable to negotiate a Subsequent Agreement during the Subsequent Negotiation Period, the Term shall expire on {***}
with no further obligations from either Party. Neither Party shall be obligated to enter into
a Subsequent Agreement. 

 

(ii)         MSLO
has the right to decline to enter into the Subsequent Negotiation Period in its sole discretion.

 

(c)          Territory.
The Parties may add countries to the Territory upon mutually agreeable terms.

 

4.           Product
Development and Design.

 

(a)          Product
Development. The Parties recognize that the name “Martha Stewart” has valuable goodwill with the consuming public
and that each of Martha Stewart and MSLO is recognized as an authority on quality and style in the area of lifestyle products and
related activities. It is the objective of this Agreement that MSLO and Licensee create Licensed Products of a quality consistent
with Martha Stewart’s and MSLO’s image and prestige. The Parties agree that as an integral part of this Agreement,
Licensee shall consult with MSLO regarding, but not limited to, the development of formulations, the sourcing of the raw materials,
assemblies, components, parts, quantities, procedures, and techniques needed to manufacture (the “Supplement Development”)
the Licensed Products. In addition, the Parties shall work collaboratively to establish the trends, themes, product innovation,
concepts, designs and product selections (the “Design Direction”) for each Licensed Product (including all changes
therein). Each Party’s personnel shall work in cooperation with each other to develop the Licensed Products consistent with
the Supplement Development and Design Direction established by the Parties, provided that nothing herein limits MSLO’s
rights of approval on the Licensed Products or any Exploitation Materials. Licensee shall provide and be responsible for all costs
and expenses incurred in connection with formulation development, ingredients, raw materials, mechanicals, match prints, production,
and printing processes. Licensee agrees that it will manufacture the Licensed Products at a price point that will maximize sales
for the parties hereunder, as well as maintain the quality required by this Agreement.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-6-

    	 

    

 

(b)          Brand
Guidelines and Style Guides. MSLO shall provide Licensee with Brand Guidelines that set forth the manner and style in which
the Trademark may be used or displayed in connection with the Licensed Products.

 

(c)          Merchandising
Plan. Licensee and MSLO will jointly develop merchandising plans at least twelve (12) months (or such other time period as
the Parties may agree is appropriate for the Product Category) prior to the planned sale of any Licensed Product.

 

(d)          Initial
Products and Product Editing. The Parties will use commercially reasonable efforts to perform their respective activities
hereunder in order to develop and Launch the initial Licensed Product(s) in accordance with the Development Calendar and by the
Initial Launch Date. In addition, subsequent to the Initial Launch Date, the parties agree to adhere to the Development Calendar,
subject to any mutually approved changes. Any deviations from the approved Licensed Products, or any changes or additions to the
line of Licensed Products or pricing philosophy, must be mutually agreed upon by the Parties, taking into consideration such factors
as historical or anticipated sales performance and profitability. Licensee agrees to update and refresh the inline assortment of
Licensed Products on an annual basis, consistent with industry standards for the Product Category.

 

(e)          Innovations.
From time to time during the Term, Licensee may acquire, develop or discover new ideas, ingredients, methods or devices (collectively,
“Innovations”) that are applicable to or useful for products included in the Product Category. If Licensee acquires,
develops or discovers any such Innovation, prior to developing, designing, manufacturing or selling any Comparable Product that
incorporates such Innovation, Licensee shall notify MSLO. MSLO shall have thirty (30) days from receipt of such notice to inform
Licensee as to whether MSLO wishes to include such Innovation in a Licensed Product. Upon receipt by Licensee of a notice that
MSLO so wishes to include the Innovation in a Licensed Product, the Parties shall work together to develop such a Licensed Product,
in accordance with the terms of this Agreement. If an Innovation is incorporated into a Licensed Product, Licensee shall not, market,
sell or offer for sale any Competitive Product incorporating such Innovation. If MSLO does not respond within thirty (30) days
to the initial notice indicating that it wishes to incorporate the applicable Innovation in a Licensed Product, Licensee shall
have no further obligation to MSLO regarding the development, design, manufacture or sale of products incorporating such Innovation.

 

5.           Quality
Control.

 

(a)          Licensee
acknowledges that within the Territory, the Licensed Property are associated with authoritative good taste, quality and style in
the area of lifestyle products and related activities. Accordingly, Licensee agrees to (i) take no action that would impair any
standards of quality that have been approved by MSLO, and (ii) manufacture, market, distribute and sell each Licensed Product in
accordance with the approvals made by MSLO hereunder. In addition, Licensee agrees that Licensed Products shall be offered for
sale, marketed and sold, and shall be advertised, promoted and otherwise exploited, in accordance with NSF International dietary
supplement standards (or other applicable standards setting entity) and consistent with the image and prestige of Martha Stewart
and the Licensed Property.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-7-

    	 

    

 

(b)          MSLO
shall have the right to approve all (i) products to be sold as Licensed Products (including without limitation the quality and
appearance thereof and component materials associated therewith), (ii) Packaging Materials, (iii)
Consumer Facings, (iv) Advertising Materials, and (v) other advertising, promotional and other exploitation materials relating
to the Licensed Products (together with the Consumer Facings and Advertising Materials, the “Exploitation Materials”).
No Licensed Products or Exploitation Materials may be used in connection with the manufacture, labeling, marketing, sale or distribution
of Licensed Products without the prior approval of MSLO. After any Licensed Products or Exploitation Materials have been approved
by MSLO, Licensee shall not modify such items without the prior approval of MSLO.

 

(c)          Every
item for approval specified and required by this section or otherwise specified in the Development Calendar to be furnished to
MSLO is to be furnished by Licensee, free of charge to MSLO, in accordance with the time frames set forth in the Development Calendar,
but in any event within ten (10) business days. The items to be furnished include component samples, as well as samples of each
initial prototype, developmental samples (as appropriate) and final samples of each of the Licensed Products, Packaging Materials,
Consumer Facings, Advertising Materials, and other Exploitation Materials proposed to be used for the Licensed Products, and such
other items as set forth in the Development Calendar. Licensee agrees that the Licensed Products manufactured, marketed, or sold
by it pursuant to this Agreement, and the Exploitation Materials utilized in connection therewith, shall conform to the specifications
and approvals developed by MSLO pursuant to this Agreement and shall be of a quality equal to or exceeding the samples of such
Licensed Product or Exploitation Materials, as the case may be, previously approved by MSLO.

 

(d)          Promptly
following execution of this Agreement, MSLO will approve a program that Licensee shall develop and implement for (i) reviewing
and testing the quality of the Licensed Products prior to the time at which they are approved for manufacture and sale, and (ii)
for monitoring quality and safety on a continuing basis to make sure that the final Licensed Products are consistent with the initially
approved samples. The cost of this program shall be the responsibility of the Licensee. This program shall include rigorous testing
of Licensed Products for safety and other appropriate elements as required by various laws and regulations. The program shall be
implemented by Licensee but shall involve MSLO personnel as the Parties deem appropriate.

 

(e)          At
any time during the Term upon reasonable notice and for a reasonable period of time, MSLO shall have the right to inspect the business
operations, including manufacturing sites, of Licensee or any vendors engaged by Licensee to create, manufacture, or distribute
any products or Exploitation Materials, including without limitation any facilities at which Licensed Products or Exploitation
Materials are manufactured, marketed, distributed or sold, to confirm that Licensee is in compliance with the terms and conditions
of this Agreement.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-8-

    	 

    

 

(f)          Upon
receipt of a notice from MSLO pursuant to this Agreement setting forth any quality deficiencies or any deviations from approved
design or manufacturing specifications with respect to the Licensed Products or Exploitation Materials, or upon the discovery of
any such deficiencies or deviations by Licensee, Licensee shall cause such deficiencies or deviations to be remedied prior to the
marketing, sale or distribution of the Licensed Products, or the distribution of the Exploitation Materials, as the case may be,
or, if such deficiencies or deviations may not be remedied, destroy such Licensed Products or Exploitation Materials.

 

(g)          In
the event quality deficiencies or deviations from approved specifications are discovered after distribution or exploitation of
Licensed Products or Exploitation Materials, as applicable, the Parties shall discuss the measures that must be taken, taking into
account both the economic consequences and the impact on goodwill related to the Licensed Property and each of MSLO and Licensee.
Without limitation of the foregoing, upon MSLO’s request, Licensee shall promptly recall any products containing any such
quality deficiencies or deviations at Licensee’s expense. Licensee must obtain MSLO’s prior approval over any recall
not mandated by applicable law. Licensee shall be responsible for the payment of royalties on sales of damaged, defective or recalled
products, and MSLO need not refund any such royalties.

 

6.           Approvals. All
matters to be submitted for approval hereunder shall be submitted to the MSLO Approval Representative. MSLO agrees to exercise
its rights of approval reasonably and promptly through the MSLO Approval Representative and in a spirit of cooperation, it being
acknowledged that any decision made by MSLO based on concerns about the Trademark, the brands of MSLO and MSLO shall not be deemed
unreasonable if made in good faith. Licensee further acknowledges that MSLO’s approval
decisions regarding the Licensed Products, Design Direction, Exploitation Materials, Distribution Plan and Advertising Strategy
may be based solely on MSLO’s subjective standards, including its aesthetic judgment regarding design, marketing, advertising
and exploitation of the Licensed Property, and regarding the appearance and other qualities of the Licensed Products. MSLO shall,
through the MSLO Approval Representative or his or her designee, strive to respond to any request for approval within ten (10)
business days or the timeframes set forth in Licensee’s internal manufacturing/formulation calendar, whichever is agreed
upon by the Parties, provided that such request for approval is submitted in material compliance with the submission procedures
that may be furnished to the Designated Brand Manager; and provided, further, that any failure by MSLO to respond within such
timeframe shall be deemed a disapproval. In the event of an objection to or disapproval of a particular item submitted for approval
hereunder, MSLO shall strive to reasonably describe the objection or reason for disapproval, provided that Licensee acknowledges
that MSLO may not be able to express with specificity such objection and/or the reason. Any approval given by MSLO under this
Agreement shall not constitute a waiver of MSLO’s rights or Licensee’s duties under any other provision of this Agreement.
Furthermore, such approval is not an acknowledgment of Licensee’s compliance with any laws or regulations (including without
limitation any safety, truth-in-advertising, labeling and/or NSF International or other standards) pertaining to the Licensed
Products, and their manufacture, marketing, sale and distribution, and shall not be so construed. MSLO’s approval does not
constitute a guaranty or warranty on the part of MSLO as to the fitness, quality, workmanship, or character of the Licensed Products.
In the event that it is reasonably necessary for MSLO to do on-site approvals to enforce its rights
under this Agreement or Licensee requests such on-site approvals, Licensee will pay any and all reasonable travel, lodging and
other out-of-pocket expenses incurred by MSLO or its representatives with respect to such on-site approvals. 

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-9-

    	 

    

 

7.           Product
Launch.

 

(a)          Each
of the Parties shall perform its respective obligations hereunder in a manner reasonably intended to result in the occurrence of
the Launch of Licensed Products on or before the Initial Launch Date.

 

(b)          In
the event that Launch has not occurred within ninety (90) days after the Initial Launch Date, and such failure is not due to a
delay caused by MSLO or MSLO’s failure to perform its obligations under this Agreement or a force majeure event beyond the
reasonable control of Licensee, then MSLO shall have the right, at its option, upon written notice to Licensee, to (i) convert
Licensee’s rights under this Agreement such that they are no longer exclusive, (ii) limit the scope of the Territory, Distribution
Channel and/or Product Category hereunder as MSLO deems appropriate and/or (iii) terminate this Agreement.

 

8.           Manufacturing,
Production, Promotion and Distribution.

 

(a)          General.
Licensee will cause the Licensed Products to be manufactured, distributed, marketed, branded and sold throughout the Territory
in accordance with the MSLO approvals hereunder, the terms and conditions of this Agreement, and all applicable laws, rules, and
regulations.

 

(b)          Projections;
Forecasts.

 

(i)          Schedule
4 hereto sets forth the projections for annual Net Sales relating to the Licensed Products through the Term, as of the date
hereof (the “Projections”). Throughout the Term, MSLO and Licensee agree to develop strategies for maximizing
Net Sales and increasing the Projections accordingly. Licensee agrees to use its best efforts in rendering services
under this Agreement to maximize Net Sales. Each Party acknowledges that it is the intent of each Party to maximize profit from
this Agreement.

 

(ii)         Six
months prior to the commencement of the second Agreement Year and each subsequent Agreement Year, Licensee shall provide MSLO with
a forecast of the royalties that will be payable to MSLO, as well as the Gross Sales and Net Sales (including all returns or allowances),
with respect to each quarter of the subsequent Agreement Year (the “Forecast”), which Forecast shall be based
on Licensee’s good faith projections at such time. In the event Licensee’s Forecast changes materially for any Agreement
Year, either prior to or during such year, Licensee will promptly inform MSLO of any such changes and the reasons therefor and,
in any event, will update the Forecast at the beginning of each Quarter.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-10-

    	 

    

 

(c)          Distribution
Channels. Licensee acknowledges that preservation of the Licensed Property and the goodwill associated therewith is of paramount
importance and that the marketing, distribution and sale of the Licensed Products may affect the reputation of the Licensed Property.
Except as otherwise set forth in this Agreement, Licensee shall only sell the Licensed Products through the approved Distribution
Channel. MSLO shall have the right to restrict or limit the distribution and sale of Licensed Products to certain accounts, channels,
or means of distribution.

 

(d)          Retail
Fixture Program. Licensee shall, in consultation with MSLO, develop, prototype, build and finalize the presentation of a fixture
program for the retail presentation of the Licensed Products. Such program shall include re-fitting and renovating as necessary
throughout the term. MSLO shall have the right to approve the final design of all fixtures and signage. Licensee shall bear all
costs associated with such program, including any costs associated with MSLO’s Creative Services hereunder.

 

(e)          Samples.
Licensee shall provide, at no charge, samples of all Licensed Products for advertising, promotion and/or editorial content relating
to the Licensed Products. All reasonable or customary expenses with respect to shipping shall be the responsibility of Licensee.

 

(f)          Inventory.
Licensee shall use commercially reasonable efforts to maintain inventory levels sufficient to meet forecast demand throughout the
course of each Agreement Year, and covenants and agrees that such efforts will result in inventory levels that are equal to or
greater than industry averages.

 

(g)          Employee
Discount. MSLO employees shall be entitled to purchase Licensed Products at a discount equal to the discount Licensee’s
employees receive on their purchases of products.

 

9.           Advertising
and Promotion.

 

(a)          Creative
Services. Upon Licensee’s request from time to time, MSLO shall design, produce and approve specifications related to
product labeling, Packaging Materials, Consumer Facings, Advertising Materials, Advertising Strategies, graphic services, photography,
pre-press and/or other Exploitation Materials (together, the “Creative Services”). After receipt of a written
request for Creative Services from Licensee in a form acceptable to MSLO, MSLO shall, within a reasonable time (not to exceed 30
business days), provide to Licensee a proposal with respect to such Creative Services, setting forth the scope of the Creative
Services to be performed and the budget therefor (the “Creative Services Proposal”). Licensee shall notify MSLO
within ten (10) days of a Creative Services Proposal whether it accepts the Creative Services Proposal. If Licensee accepts
the Creative Services Proposal within such time frame, then MSLO shall perform the Creative Services described in the Creative
Services Proposal. If Licensee does not accept the Creative Services Proposal, or if MSLO does not exercise its rights with respect
to any or all of the Creative Services, Licensee shall be free to obtain the applicable Creative Services from another provider
using the Brand Guidelines provided by MSLO, provided, however, that all of MSLO’s approval rights pursuant to this Agreement
remain in effect with respect to any and all work generated by such service providers to be used in connection with any Licensed
Product or advertising or promotion related thereto and that MSLO shall use its best efforts to work within Licensee’s creative
production timeline in order to meet media insertion and airdates, provided Licensee timely submits such information. Unless otherwise
set forth in the Creative Services Proposal, Licensee shall pay MSLO for any Creative Services performed
by MSLO or its outside providers hereunder in accordance with the Creative Services Proposal within thirty (30) days of receipt
of invoice therefor and also shall reimburse MSLO for all costs (including without limitation travel, staffing, art direction and
design, copyrighting, art production, digital image correction and enhancement, retouching, styling and showroom display, web design
and production, finished artwork, mechanicals, photo shoots, photography costs, etc.) to be incurred by MSLO in connection with
the preparation and provision of such Creative Services in accordance with the Creative Services Proposal, provided such cost estimates
are pre-approved by Licensee. {***}.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-11-

    	 

    

 

(b)          Licensee
Activities. Subject to Section 9(a), Licensee shall (i) design, produce, and execute all photography, Packaging Materials,
Consumer Facings, and Advertising Materials based on concepts and prototypes approved by MSLO (“Brand Guidelines”)
developed by the Parties and produce all other Exploitation Materials; (ii) effect the marketing, promotion, sale and distribution
of the Licensed Products in accordance with this Agreement and enforce all of its agreements with its vendors, wholesalers, retailers
and distributors; (iii) implement the Advertising Strategy; and (iv) perform such other services, including participate in trade
shows, in connection with the Licensed Products as Licensee would typically render in connection with the Comparable Products,
including, without limitation, services relating to Supplement Development, manufacture, promotion, advertising, distribution and
sale of products. In connection with the foregoing, subject to MSLO’s approval and in collaboration with MSLO, Licensee shall
ensure that the Licensed Products are supported by marketing and promotional activities and other promotional activities in accordance
with the Advertising Strategy (collectively, “Exploitation Activities”) and that appropriate Exploitation Activities
are conducted throughout the Territory, consistent, qualitatively, with the nature of and manner in which Exploitation Activities
are conducted in the Territory for Comparable Products. In addition, Licensee shall not favor Comparable Products over the Licensed
Products in terms of sales and promotion. The final samples of the Packaging Materials, Consumer Facings, Advertising Materials
and other Exploitation Materials shall be subject to MSLO’s prior approval. In addition, the location, medium or publication
in which any Exploitation Material is proposed to be placed and the timing of the placement also shall be subject to MSLO’s
prior approval. Licensee shall provide to MSLO, free of charge for its permanent archives, copies of all Exploitation Materials
used by Licensee in connection with the business to be conducted by Licensee under this Agreement (the “Business”).
Licensee shall provide MSLO with its Advertising Strategy at least three (3) months prior to the end of Agreement Year 1, and every
subsequent Agreement Year during the Term. 

 

(c)          Trade
Shows. Licensee shall obtain MSLO’s approval regarding the type and location of the trade show and for all Exploitation
Materials developed in connection with trade shows. For clarity, Licensee’s expenses for trade shows, including set up and
labor, are not included as a component of the Marketing Spend, as defined below.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-12-

    	 

    

 

(d)          Advertising/Marketing
Spend. During each Agreement Year, Licensee shall spend the amounts outlined in Schedule 2 (the “Marketing
Spend”) for advertising, marketing and promotional activities, including, but not limited to in-store signage and displays,
co-op marketing, and local and national advertising initiatives. Licensee will spend a minimum of {***}%
of each annual Marketing Spend on MSLO media properties during each Agreement Year. If MSLO sells the Products through MSLO Outlets,
Licensee agrees to have one couponing/redemption event per year through the MSLO Outlets, at Licensee’s expense. Any additional
couponing/redemption events that are held in connection with sales through MSLO Outlets will be at MSLO’s discretion.

 

(e)          MSLO
Activities.

 

(i)          Licensee
will pay all costs and expenses in connection with services set forth in this Section 9 including, without limitation, costs of
(i) {***}. MSLO shall provide Licensee with itemized documentation of such expenses.
With regard to Martha Stewart’s appearance {***}.

 

(ii)         Ms.
Stewart shall provide Licensee with up to {***} per Agreement Year for the purposes
of advertising and promoting the Licensed Products. {***}and Licensee shall use its
best efforts to notify Ms. Stewart at least {***} in advance of the proposed Production
Days. {***} . Licensee, or any other entity for which Martha Stewart is rendering her
services in connection with each such commercial, will be a signatory to any such applicable union, guild and collective bargaining
agreement. {***}.

 

10.          Royalties
and Other Payments.

 

(a)          
Advance. Licensee shall make the following advance payments to MSLO (the “Advance”) (i) ${***}
due upon execution of this Agreement by both Parties, (ii) ${***} by{***}, (iii) ${***} by {***}, and
(iv) $ {***} by {***}.

 

(b)          Royalty.
Licensee shall pay MSLO a royalty equal to {***} percent ({***}%)
of Net Sales on all sales except {***}, for each Agreement Year during the initial
Term (such applicable amount, the “Licensing Fee”). The applicable Licensing Fee is referred to as the “Royalty”
and shall be paid as provided in 10(e). 

 

(c)          Minimum
Guaranteed Annual Royalty. Licensee shall pay MSLO the minimum guaranteed annual royalties as follows:

 

	Agreement Year 1 = $ 1,800,000.00
	Agreement Year 2 = $ 2,100,000.00
	Agreement Year 3 = $ 2,700,000.00
	Agreement Year 4 = $ 3,200,000.00
	Agreement Year 5 = $ 3,800,000.00
	Total = $13,600,000.00 

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-13-

    	 

    

 

In the event
that the Parties agree to an Extension, the Minimum Guaranteed Annual Royalty for the Extension shall {***} ${***}
or an amount equal to {***} percent ({***}%)
of the actual Royalty due during the {***} Agreement Year. The Parties agree that any
Royalties paid for a given Agreement Year shall be credited against the Minimum Guaranteed Annual Royalty due for such Agreement
Year, but no payment of Royalties in any one Agreement Year shall be credited against the Minimum Guaranteed Annual Royalty due
for any other Agreement Year. 

 

(d)          Reports.
Licensee shall deliver royalty reports to MSLO in electronic format within thirty (30) days following the end of each Quarter (the
“Quarterly Reports”). Each Quarterly Report shall be certified as accurate by an authorized officer of Licensee
and shall set forth the Gross Sales and Net Sales (including itemized deductions) for such Quarter, the royalties due and owing
for such Quarter and such other related information as MSLO may reasonably request. In addition to the Quarterly Reports, Licensee
shall deliver non-binding (but based on Licensee’s current knowledge), interim reports on a monthly basis containing similar
information to that contained in the Quarterly Reports. Each such interim monthly report shall be delivered within ten (10) days
from the end of the month to which the report relates. Upon MSLO’s reasonable request, and in any event within thirty (30)
days after the end of each Agreement Year, Licensee shall also deliver a report detailing Licensee’s advertising and promotional
activities in connection with the Licensed Products, including detailed expenditures on Exploitation Activities. Licensee will
also provide to MSLO monthly sales reports. All reports should be sent to the attention of the VP of Finance and the SVP of Licensing
of MSLO.

 

(i)          Payment.
Licensee shall pay the Minimum Guaranteed Annual Royalty {***}.

 

If actual Royalties earned exceed the Minimum Guaranteed Annual
Royalty for any Agreement Year, excess Royalties shall be paid when Licensee delivers its final quarterly payment to MSLO for the
then current Agreement Year. All payments shall be made by wire transfer to the bank account designated by MSLO in Exhibit A.

 

(e)          Records;
Audit. During the Term of this Agreement (including any Extension) and for two years thereafter (or such longer period as is
required by law), Licensee shall maintain complete and accurate records of Licensee’s activities hereunder, including without
limitation the sales of Licensed Products by Licensee, all Royalty computations and Royalty reports under this Agreement. During
the Term of this Agreement (including any Extension) and for two years thereafter, upon MSLO’s reasonable request, Licensee
shall make such records and all other documents and materials in the possession or control of Licensee, to the extent relevant
to this Agreement and reasonably required to verify Licensee’s satisfaction of its obligations hereunder, available to MSLO
or its duly authorized representatives, during normal business hours at Licensee’s principal offices, and shall, during such
period, make extracts from such records for MSLO’s use in connection with these purposes.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-14-

    	 

    

 

 

(f)          Underpayment/Delinquent
Payments. In the event that Licensee has underpaid MSLO pursuant to this Agreement or is forty-five (45) days late in making
any such payment, Licensee shall promptly pay MSLO the aggregate difference between what MSLO should have been paid and what MSLO
was paid, plus interest at a rate which is the lesser of (i) {***}, or (ii) the maximum rate
allowed by law. This provision is in addition to, and not alternative to, MSLO’s other remedies under this Agreement. Moreover,
in the event that an audit reveals that the amount of any such underpayment equals or exceeds {***} percent
({***}%) of the amounts actually paid to MSLO during the period with respect to which
the audit was conducted, Licensee shall bear MSLO’s reasonable costs of conducting the audit, including, without limitation,
any amounts payable to MSLO’s outside auditors in connection therewith.

 

11.         Coordination;
Continuing Planning and Strategy.

 

(a)          Coordination.
Licensee shall designate a Designated Brand Manager acceptable to MSLO dedicated to the Licensed Products who will act as the single
point of contact between MSLO and Licensee on all matters regarding the use of the Licensed Property in connection with the Licensed
Products. MSLO shall designate an MSLO Approval Representative. MSLO will have the right to request a new Designated Brand Manager
in the event that the Designated Brand Manager becomes unacceptable to MSLO. The Designated Brand Manager will designate a proxy
reasonably acceptable to MSLO to handle the Business when the Designated Brand Manager is on vacation or otherwise unavailable
so that the Business is not adversely affected and so that progress hereunder is not delayed.

 

(b)          Continued
Planning and Strategy. Each Agreement Year the Parties agree to adopt a schedule of regular meetings and communications. The
Parties will make available appropriate representatives to such meetings, which shall include the Designated Brand Manager, to
plan and to discuss the matters applicable to the subsequent Agreement Year, including without limitation business objectives,
sales targets and updates to the Distribution Plan and Advertising Strategy, as well as a plan to achieve such objectives and targets
and to implement such strategies.

 

12.         Licensed
Property Retention; Use of Licensed Property.

 

(a)          Except
for the express license rights granted herein, all right, title and interest in the Licensed Property, including all copyright,
trademark, patent and other rights therein (and all renewals and extensions thereof) and all goodwill associated therewith shall
be owned exclusively by MSLO. Except for such express license rights granted herein, MSLO reserves for its sole use and benefit
all rights in the Licensed Property and nothing contained herein shall be construed as an assignment or grant to Licensee of any
right, title or interest in or to the Licensed Property. Licensee further acknowledges that it has no right to use the Martha Stewart
name in any way except solely in connection with the Trademark.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-15-

    	 

    

 

(b)          Any
use which Licensee may be permitted to make of the Licensed Property pursuant to this Agreement shall be subject to MSLO’s
prior approval as specified herein. At all times, Licensee shall use the Licensed Property only in the
form and manner expressly approved by MSLO, and only on Licensed Products, Packaging Materials, Consumer Facings, Advertising
Materials and other Exploitation Materials manufactured by or for Licensee. Without limiting the generality of the foregoing, no
part of the Licensed Property may be used (i) in any advertising materials other than in connection with the advertising and promotion
of Licensed Products or (ii) in conjunction with any other name, character, symbol or design not included within the Licensed Property
unless otherwise approved by MSLO in each instance. The Licensed Products may not be packaged for sale
or combined with other articles or third party products without MSLO’s prior approval. 

 

Licensee acknowledges and confirms the validity and sole ownership
by MSLO of the Licensed Property and the goodwill associated therewith, and agrees that all use by Licensee of the Licensed Property
shall inure solely to the benefit of MSLO and, as such, Licensee shall not at any time acquire any rights in the Licensed Property
by virtue of any use or exploitation Licensee may make thereof. Licensee agrees not to use any of the Licensed Property in the
name of any of its Affiliates, and further agrees not to use in any manner any other word, trademark, trade name, symbol, design
or the like which is similar to or which might possibly be confused with any of the Licensed Property. Licensee further agrees
that it shall not create, reproduce, sell, distribute, or promote any competing products within the Product Categories (whether
directly or indirectly), which feature designs or product packaging that is substantially similar, has a similar look and feel,
and/or trade dress as the Licensed Products.

 

(c)          Licensee
shall not contest the validity of the Licensed Property, MSLO Materials or any other proprietary interest of MSLO or its Affiliates
(including Martha Stewart) or otherwise take any action that would injure the image or reputation of MSLO or its Affiliates (including
Martha Stewart) or any proprietary interest of MSLO or its Affiliates (including Martha Stewart).

 

(d)          Upon
the expiration or termination of the Agreement, all rights in the Licensed Property shall automatically revert to MSLO for its
sole use and disposition with no further obligation whatsoever to Licensee or any third party.

 

(e)          Licensee
agrees that there will appear on all Licensed Products, Packaging Materials, Consumer Facings, Advertising Materials and other
Exploitation Materials, such copyright and trademark notices and other legends, markings and notices in the form specified by MSLO
as may be reasonably deemed necessary by MSLO for protection under trademark, copyright or other applicable laws. MSLO reserves
the right reasonably to prescribe any other form of legal notice.

 

(f)          Licensee
agrees that any formulations (each, a “Formulation”), created by Licensee, jointly by the Parties, or any third
party, as a part of the Supplement Development processes for use with the Licensed Property shall be owned by MSLO. If ownership
of the intellectual property rights in any Formulation does not vest in MSLO as a work for hire, then Licensee hereby irrevocably
transfers and assigns to MSLO all of its rights in such Formulation. Notwithstanding the foregoing, any Formulation created by
Licensee and/or a third-party that was (i) owned by Licensee or third party prior to the date of this Agreement, (ii) created by
or for Licensee (other than by MSLO), and not used in connection with the Licensed Product, whether created before or after the
date of this Agreement, which Formulation represents an improvement to the nutritional supplement capsules developed by or for
Licensee, or (iii) not developed specifically for the Licensed Products, Packaging Materials, Advertising Materials, Consumer Facings
and other Exploitation Materials (the “Licensee Intellectual Property”), shall be excluded.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-16-

    	 

    

 

(g)          Licensee
agrees that all trademark, copyright, design and other intellectual property rights (collectively “Intellectual Property“)
in the Licensed Property, Licensed Products, Packaging Materials, Advertising Materials, Consumer Facings and other Exploitation
Materials and all related materials (including without limitation drafts thereof, whether or not actually produced and used) and
any and all samples, sketches, designs or other materials related to any of the foregoing and any modifications or improvements
thereto (collectively “MSLO Materials”), in each case, whether developed by MSLO, Licensee (or jointly by the
Parties) or any third party (other than Licensee Intellectual Property) shall be deemed works made for hire for MSLO, and shall
be owned by MSLO in MSLO’s name. If ownership of the intellectual property rights in any MSLO Materials does not vest in
MSLO as a work for hire, then Licensee hereby irrevocably transfers and assigns to MSLO all of its rights in such MSLO Materials.
Licensee specifically acknowledges and agrees that MSLO may permit others to use the MSLO Materials in any manner MSLO desires,
provided that such use does not conflict with any rights that MSLO is granting to Licensee hereunder. In the event Licensee
employs any third party in the development of any Exploitation Materials embodying distinct intellectual property, Licensee
shall obtain from each such third party an agreement confirming MSLO’s ownership of all results and proceeds of such third
party’s labor as a work made for hire for MSLO. Each such agreement shall provide that if ownership of the intellectual property
rights in any results and proceeds of such third party’s labor does not vest in MSLO as a work for hire, then such third
party irrevocably transfers and assigns all right, title and interest in the results and proceeds of its labor to MSLO.

 

13.         Maintenance
and Protection of the Licensed Property.

 

(a)          Licensee
agrees to assist MSLO in the procurement and maintenance of MSLO’s rights in the Licensed Property and in connection therewith,
Licensee agrees to provide samples to MSLO as reasonably requested at no charge and to execute and deliver to MSLO in such form
as may reasonably be requested all instruments (including appropriate applications for registration and assignment) necessary to
effectuate copyright, trademark and/or other intellectual property protection for MSLO. Licensee hereby appoints MSLO as its attorney-in-fact
in order to execute such instruments on Licensee’s behalf. The power granted MSLO in the preceding sentence is acknowledged
by Licensee to be coupled with an interest and shall be irrevocable.

 

(b)          If
required by local law, Licensee further agrees to notify the applicable regulatory authorities of this Agreement or register this
Agreement with such regulatory authorities, as applicable.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-17-

    	 

    

 

(c)          Licensee
agrees to inform MSLO promptly of any encroachment or infringement of the Licensed Property in the Territory which comes to the
attention of Licensee. Any litigation or other action to police the Licensed Property and to abate infringement shall be under
the complete control and expense of MSLO. MSLO may retain any money judgment or settlement in such action. Licensee agrees to cooperate
fully in any such litigation or action, to the extent necessary, in the vigorous prosecution of the matter, and MSLO agrees to
reimburse Licensee for its out-of-pocket expenditures in furtherance thereof. MSLO shall have the sole right to determine what,
if any, actions shall be taken on account of any such infringement or encroachment. If MSLO so desires, MSLO, at MSLO’s sole
expense, may (i) prosecute any such claim in its own name or (ii) shall have the right to cause Licensee to join as a party thereto.
Licensee shall not have any rights against MSLO for damages or other remedy by reason of MSLO’s decision not to prosecute
any alleged infringement or encroachment of the Licensed Property.

 

14.         Representations
and Warranties.

 

(a)          By
MSLO. MSLO represents and warrants to Licensee that (i) it is an entity in good standing in the jurisdiction of its formation
and each other jurisdiction in which it conducts business, except where the failure to be so qualified or in good standing, as
the case may be, would not have or reasonably be expected to materially adversely affect its ability to meet its obligations under
this Agreement, (ii) it has the full right and authority to enter into this Agreement and
the relationship contemplated herein, including necessary approvals from its board of directors
or members, as the case may be, and to perform its obligations hereunder (iii) it owns full right and title in and to the Licensed
Property, (iv) to MSLO’s knowledge, Licensee’s
authorized use of the Licensed Property shall not infringe or violate the trademark rights of any third parties, and (v) to MSLO’s
knowledge, the execution of this Agreement, the performance of its duties thereunder, do not violate any applicable law or regulations
or violate or infringe any agreement, arrangement or obligation to which MSLO (or any of its Affiliates) is a party. Except as
expressly set forth herein, MSLO makes no representations or warranties as to the Licensed Property, Licensed Products, or the
prospects of the Business. Furthermore, in the event that MSLO reasonably determines that the use of the Licensed Property on any
products in a country outside of the United States violates any trademark or other rights of a third party, MSLO shall have the
right, without incurring any liability, to remove such country from the Territory, and upon receipt of notice from MSLO, Licensee
shall not sell such products into such country.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-18-

    	 

    

 

(b)          By
Licensee. Licensee hereby represents and warrants to MSLO that (i) it is an entity in good standing in the jurisdiction of
its formation and each other jurisdiction in which it conducts business, except where the failure to be so qualified or in good
standing, as the case may be, would not have or reasonably be expected to materially adversely affect its ability to meet its obligations
under this Agreement, (ii) it has the full right, power and authority to enter into this Agreement and the relationship contemplated
herein, including necessary approvals from its board of directors or members, as the case may be, and to perform its obligations
hereunder; (iii) to Licensee’s knowledge, the exploitation and/or sale by MSLO or Licensee of the Licensed Products or any
other intellectual property created or provided by Licensee, shall not violate or infringe upon any rights whatsoever of any third
party (including without limitation patents, if any) or any applicable laws or regulations (including, without limitation, safety,
truth-in-advertising, labeling and flammability standards), except that this representation or warranty does not apply to any violation
or infringement that is related to the Licensed Property; (iv) the Licensed Products (including any manufacture, packaging, labeling,
or other information provided therewith), Packaging Materials, Advertising Materials, Consumer Facings and all other Exploitation
Materials will conform in all respects with, and satisfy, applicable international, national, Federal, State and local laws, orders
and regulations and applicable industry guidelines; (v) Licensee has obtained, or will obtain prior to conducting any activities
in a particular country of the Territory, all approvals and certifications necessary to perform its activities hereunder in such
country; (vi) Licensee has obtained and will continue to keep in force all necessary patents for the Licensed Products, if any;
(vii) the Licensed Products, Packaging Materials, Advertising Materials, Consumer Facings and all other Exploitation Materials
shall be free from defects in material and workmanship; (viii) the Licensed Products are and shall be merchantable and fit for
the purpose for which they are intended, and shall conform to their applicable specifications; and (ix) the Licensed Products,
Packaging Materials, Advertising Materials, Consumer Facings and all other Exploitation Materials shall be consistent with and
not deviate from the samples or prototypes that received final MSLO approval hereunder.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-19-

    	 

    

 

15.         Indemnification.

 

(a)          Licensee
agrees to defend, indemnify and hold harmless MSLO and its Affiliates, officers, directors, shareholders, employees and representatives
from, in respect of and against any and all claims, costs, losses, liabilities, expenses (including, without limitation, reasonable
attorneys’ fees and disbursements), judgments, damages, demands, lawsuits or similar actions or proceedings (each, a “Claim”)
arising out of a third-party claim based on (i) the breach or alleged breach of any of Licensee’s representations, warranties
or covenants hereunder; (ii) the manufacture, packaging, distribution, use or sale of the Licensed Products including, without
limitation, all claims for product liability or product defects; and (iii) Licensee’s direct contribution
to or participation in the promotion or advertising of the Licensed Products, other than
any Claim based primarily on a breach of any representation or warranty of MSLO (each, a “Licensee Claim”).
MSLO agrees to notify Licensee within a reasonable time after it receives notice of any Licensee Claim, and Licensee shall promptly
assume MSLO’s defense thereof with counsel acceptable to MSLO in its reasonable discretion. MSLO shall have the right to
participate in the defense of any Licensee Claim with separate counsel of its choosing and at MSLO’s expense. Any settlement
that affects the Licensed Property or otherwise contains a remedy other than the payment of money damages by Licensee (that in
any way impacts upon MSLO) must be approved in writing in advance by MSLO, which approval shall not be unreasonably withheld or
delayed.

 

(b)          MSLO
agrees to defend, indemnify and hold harmless Licensee and its officers, directors, shareholders, employees and representatives
from, in respect of and against any and all Claims to the extent arising out of a third-party claim based on the breach or alleged
breach of any of MSLO’s representations, warranties or covenants hereunder, other than any Claim (including, without limitation,
any Claim for product liability) based primarily on a breach of any representation or warranty of Licensee (each, an “MSLO
Claim”). Licensee agrees to notify MSLO within a reasonable time after it receives notice of any MSLO Claim and MSLO
shall promptly assume Licensee’s defense thereof with counsel acceptable to Licensee in its reasonable discretion. Licensee
shall have the right to participate in the defense of any MSLO Claim with separate counsel of its choosing and at Licensee’s
expense. Any settlement that contains a remedy other than the payment of money damages by MSLO (that in any way impacts upon Licensee)
must be approved in writing in advance by Licensee, which approval shall not be unreasonably withheld or delayed.

 

16.         Insurance. Licensee
shall maintain in full force and effect comprehensive general liability insurance (the “Licensee Insurance”),
including, without limitation, product liability insurance, covering all products sold by it as well as any liability on its part
in the amount of at {***} The Licensee Insurance shall be placed with an insurer or insurers of recognized worth and reputation,
duly licensed to carry on the business of insurance in all parts of the Territory and shall name MSLO, its Affiliates and their
respective officers, directors, employees, representatives or agents as additional insureds, for coverage against all forms of
liability for death or injury to any individual, and for loss or damage to property. The Licensee Insurance shall provide for
primary coverage and not contributory coverage, notwithstanding any other insurance which MSLO may obtain or maintain. If coverage
is issued or renewed on a claims-made form, the retroactive date for coverage will be no later than the commencement date of this
Agreement. In the event of cancellation or nonrenewal, or failure to replace with coverage from another carrier, the discovery
period for insurance claims (tail coverage) will be at least 36 months from termination of this Agreement. The Licensee Insurance
shall provide for at least thirty (30) days prior written notice to MSLO of cancellation, lapse or material change in the Licensee
Insurance and Licensee shall provide MSLO with a certificate of insurance as evidence of the Licensee Insurance prior to, or as
soon as practicable after, the execution hereof.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-20-

    	 

    

 

17.         Expiration
and Termination.

 

(a)          Except
as otherwise set forth herein, this Agreement shall expire upon the conclusion of the Term.

 

(b)          Either
Party may sooner terminate this Agreement, without waiving any other rights or remedies, and without any liability for such termination,
upon thirty (30) days’ prior written notice (but in the case of non-payment, upon ten (10) days’ prior written notice)
if the other Party materially breaches or otherwise fails to perform any of its obligations hereunder, unless the breaching Party
remedies the same within such thirty (30) days’ period (or in the case of non-payment, such ten (10) day period) and notifies
the non-breaching Party of such remedy in writing within such period. Failure to timely pay amounts due hereunder shall constitute
a material breach hereof. In the event that MSLO terminates this Agreement pursuant to this Section 17(b), Licensee will immediately
pay to MSLO any and all unpaid royalties, licensing fees and any other amounts due or accrued up to and including such date of
termination as well as any amounts due for what would have been the remainder of the Term (including without limitation any Minimum
Annual Royalties). If such amounts are not paid to MSLO within ten (10) days of the date of termination, MSLO shall be entitled
to recover such amounts on an accelerated basis in any court of law of competent jurisdiction. Unless Licensee terminates this
Agreement for MSLO’s breach in accordance with this Section 17(b), all amounts paid to MSLO during the Term shall be non-refundable.

 

(c)          Either
Party shall have the right to terminate this Agreement immediately (subject to such Party’s compliance with any mandatory
legal requirements then in force and applicable to such termination) upon written notice to the other Party in the event: (i) that
the other Party generally becomes unable to pay its debts as they become due; (ii) of the filing with the bankruptcy court by or
against the other Party of a petition under any chapter or entry of an order for relief under Title 11 of the United States Code;
(iii) that the other Party makes a general assignment for the benefit of creditors; or (iv) that a receiver of all or substantially
all of the other Party’s property is appointed.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-21-

    	 

    

 

(d)          MSLO
shall have the right to terminate this Agreement immediately upon written notice to Licensee in the event that: (i) Licensee discontinues
its business or substantially all of Licensee’s property is expropriated, confiscated or nationalized by any government,
or any government assumes de facto control of substantially all of Licensee’s business; (ii) Licensee is acquired by another
entity by means of any one transaction or a series of related transactions (including, without limitation, any merger, reorganization
or consolidation, but excluding any merger effected exclusively for the purpose of changing the domicile of Licensee) in which
Licensee’s stockholders of record as constituted immediately prior to such acquisition do not, immediately after such acquisition
(by virtue of securities issued as consideration for the Licensee’s acquisition or otherwise), hold at least 50% of the voting
power of the resulting or surviving entity; (iii) there occurs a sale, lease, pledge or other disposition to another person[s]
of all or substantially all of the assets of the Licensee in one transaction or a series of related transactions; (iv) there occurs
a grant or pledge of any license or sublicense with respect to any of the rights or Licensed Property covered by this Agreement
to another person; or (v) Royalties earned in any Agreement Year beginning in the second Agreement Year are 60% or less than Royalties
earned in the previous Agreement Year.

 

(e)          Licensee
shall have the right to immediately terminate this Agreement if (a) MSLO and/or Martha Stewart engage in any unlawful or
willful misconduct in either case that results in: (i) either making any derogatory or disparaging remarks about Licensee or (iii)
materially adversely affecting the Parties’ rights or obligations under this Agreement. In the event of a material breach
of this provision, Licensee may terminate this Agreement.

 

(f)          Upon
termination or expiration of this Agreement: (i) except as otherwise provided in subsection (g) or (h) below, Licensee shall
immediately stop the manufacture, sale and distribution of all Licensed Products; (ii) 
all royalties accrued on Net Sales shall be immediately due and payable, and to the extent that the termination is a result
of Licensee’s breach, any amounts due for what would have been the remainder of the Term (including without limitation Minimum
Annual Royalties shall become immediately due and payable as of the date of termination; (iii) Licensee shall send MSLO a
complete and detailed list of its inventory of Licensed Products (including work-in-progress and products on consignment, if any)
within thirty (30) days and MSLO shall have the right, but not the obligation, to purchase part or all of Licensee’s inventory
of Licensed Products at Licensee’s direct manufacturing cost; and (iv) except as otherwise provided in subsection (g),
below, Licensee shall destroy any previously manufactured products which MSLO has not elected to purchase
and furnish MSLO with an affidavit of destruction.

 

(g)          Notwithstanding
the provisions of Sections 17(f)(i) and (iv)
above, solely in the event of the expiration of this Agreement upon the conclusion of the Term (or any Extension) or termination
of the Agreement by Licensee pursuant to Sections 17(b) or (e), Licensee shall have the right, following MSLO’s rejection
of Licensee’s offer to MSLO to purchase inventory pursuant to Section 17(f),
for a period of six (6) months to sell off Licensed Products remaining in its inventory and to account to MSLO therefor,
including the provision of Quarterly Reports as described above. During the last six (6) months prior to such expiration
of this Agreement, Licensee shall not manufacture an excessive number of Licensed Products. Following the expiration of said sell-off
period, Licensee shall destroy all Licensed Products remaining in its inventory and furnish MSLO with an affidavit of destruction.
Licensee shall pay to MSLO all Royalties due on Net Sales during such sell-off period, and all of MSLO’s rights and Licensee’s
obligations with respect to such products shall apply during such sell-off period.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-22-

    	 

    

 

(h)          In
addition to the other provisions herein, upon termination or expiration of this Agreement, Licensee will cease, and will cause
its vendors, customers and retailers to cease, any use, distribution or other exploitation of any Exploitation Materials (including
without limitation any packaging materials or signage or displays in store or on any website), or any other items bearing, in whole
or in part, reference to MSLO (including, without limitation, any “Martha Stewart” trademarks) (collectively, the “MSLO
Branded Materials”). To the extent Licensee has a sell-off right following expiration or termination of this Agreement,
Licensee or any vendors, customers or retailers who have in their possession or control any MSLO Branded Materials at the time
of the termination or expiration of this Agreement, shall be permitted to use such MSLO Branded Materials during such sell-off
period. At the end of such sell-off period, if any, Licensee shall return such MSLO Branded Materials to MSLO, or confirm in writing
to MSLO the destruction of the MSLO Branded Materials.         

 

18.         Additional
Covenants. Notwithstanding anything to the contrary provided herein, Sections 1, 10, 12-23, and 25 hereof shall survive
any expiration or termination hereof.

 

(a)          Non-Competition.
Without the prior written consent of MSLO, which MSLO may withhold in its absolute discretion, Licensee shall not, and shall cause
each of its Affiliates not to, manufacture, market, promote, sell or distribute any Competitive Product.

 

(b)          Non-Solicit;
Non-Hire. For the duration of the Term and one (1) year thereafter, neither Party shall solicit for employment or the provision
of services, or hire for employment or the provision of services, personnel of the other Party or its Affiliates. Notwithstanding
the foregoing, this provision shall not apply to situations in which (i) the applicable personnel responds to public job advertisements
but has not otherwise been directly solicited, (ii) the Party that employs or engages the individual being solicited terminates
the individual being solicited for any reason, or (iii) either Party consents to the other soliciting or hiring particular personnel.

 

19.         Product
Defects. As between MSLO and Licensee, Licensee assumes all liability whatsoever for customer service, defects or breach of
warranty or any type of product liability claim whatsoever regarding any products. In the event that an ultimate purchaser of
any Licensed Product manufactured or sold during the Term, or any other third party, claims such product to be defective or in
breach of any warranty or otherwise raises a product liability claim with respect to the product, Licensee shall assume all the
obligations, liabilities, costs and expenses relating in any manner to such product, including, without limitation, any claimed
defect or breach of warranty or other product liability claim; provided, however, that Licensee shall promptly report
to MSLO all claims and obligations that arise hereunder.

 

20.         No
Assignment. Licensee’s rights and obligations hereunder are personal to Licensee and
shall not be assigned, mortgaged, or otherwise transferred or encumbered by Licensee whether by operation of law or
otherwise (including pursuant to a sale of all or substantially all of Licensee’s assets or equity or pursuant to a
merger or other change of control). Any such assignment or transfer in contravention of the foregoing shall be null and void
and of no force or effect. Subject to MSLO’s prior written approval Licensee may subcontract any portion of the design,
development, manufacture or marketing of Licensed Products hereunder but only if Licensee (i)
requires in each such subcontract the subcontractor’s full compliance with, and performance of, all of the nonmonetary
terms and conditions hereof; and (ii) furnishes to MSLO the name and address of each subcontractor. MSLO may freely
assign this Agreement or the benefits hereof. This Agreement will be binding on and inure to the benefit of and be
enforceable by the parties and their permitted heirs, successors and assigns.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-23-

    	 

    

 

 

21.         Choice
of Law: Venue.

 

This Agreement shall be construed in accordance
with laws of the State of New York, without regard to the conflict of laws or choice of laws principles. The
Parties agree that any action or proceeding brought by any Party arising out of or related to this Agreement shall be brought in
courts located in the State of New York, County of New York. Accordingly, each of the Parties irrevocably consents to the jurisdiction
of the courts of the State of New York and of any Federal Court located in New York in connection with any action or proceeding
brought during or after the term of this Agreement and arising out of or related to this Agreement, and each Party irrevocably
waives any objection to venue or any claim that the action is brought in an inconvenient forum.

 

22.         Confidentiality. 

 

(a)          After
the date hereof, each of Licensee and MSLO (i) shall hold and shall cause its officers, Affiliates,
directors, employees, agents, accountants, representatives and advisors (“Representatives”) to hold in strict
confidence all the terms of this Agreement and all information furnished to such Party or its Representatives in connection with
the transactions contemplated by this Agreement as well as information concerning the other Party (or such Party’s Affiliates)
contained in analyses, compilations, studies or other documents prepared by or on behalf of such Party (or such Party’s Affiliates)
(collectively, the “Information”); provided that the Information shall not include any information which
has become (A) generally available to the public other than as a result of a disclosure by such Party or such Party’s
Representatives, (B) available to such Party on a non-confidential basis from a source other than the other Party or the agents
of one of them if such source is to such Party’s knowledge entitled to disclose such information, or (C) independently
acquired or developed by such Party; and (ii) shall not, without the prior written consent of the other Party, release or
disclose any Information to any other person, except (A) to such person’s Representatives who need to know the Information
in connection with the consummation of the transactions contemplated by this Agreement, who are informed by such person of the
confidential nature of the Information and who are caused by the relevant Party to comply with the terms and conditions of this
Section, and (B) as may be required by applicable law, regulations or legal processes (including, without limitation, any
disclosures of Information which are required to be made by applicable securities laws in connection with any financing activities
of either Party or general disclosure requirements pursuant to the Securities Exchange Act of 1934, as amended, or the rules of
the New York Stock Exchange). In the event either Party is compelled to disclose this Agreement, it shall take all reasonable steps
to limit the scope of such disclosure, including, with respect to any filing with the Securities and Exchange Commission, the seeking
of confidential treatment of financial and other sensitive information.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-24-

    	 

    

 

(b)          Prior
to any vendor of Licensee receiving any concepts, designs or other confidential or proprietary information relating to MSLO, Martha
Stewart or the Licensed Products, Licensee shall cause such vendor to enter into the form of agreement attached hereto as Schedule
3 (the “Covered Vendor Agreement”), which shall include, among other items, an obligation on the part of
such vendor to maintain the confidentiality of any concepts, designs or other confidential or proprietary information relating
to MSLO, Martha Stewart or the Licensed Products.

 

23.        Notice. Any
notice or other communication required or permitted to be given under the provisions of this Agreement shall be in writing and
shall be deemed to have been duly given (i) upon delivery if delivered in person, (ii) three (3) business days after the date
of mailing if mailed by U.S. registered or certified mail, postage prepaid and return receipt requested, (iii) one (1) business
day after the date of delivery to a reputable overnight courier service, with all conditions for delivery satisfied, or (iv) upon
transmission by facsimile (if an appropriate answerback confirmed is received) if delivered through such services to the following
addressees:

 

If to MSLO:

 

Martha Stewart Living Omnimedia, Inc.

601 West 26th Street

New York, NY 10001

Attention: EVP Global Licensing

Facsimile No. (212) 389-4536

 

Copy to: General Counsel

Facsimile No. (917) 591-5201

 

If to Licensee:

 

Inergetics, Inc.

205 Robin Road – Suite 222

Paramus, NJ 07652

 

Facsimile No. (201) 262-1313

 

Copy to: Richard Feiner, Esq.

 

Silverman Shin & Byrne PLLC

381 Park Avenue South

New York, NY 10016

 

Facsimile No. (917) 720-0863

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-25-

    	 

    

 

Each Party may change the contact information for its receipt
of notice by written notice to the other Party in the manner prescribed above.

 

24.        Compliance
with Human Rights and Labor Standards. Licensee and MSLO each agree that ensuring
that the Licensed Products are manufactured in compliance with all applicable human rights, labor and wage laws is an important
objective of the Parties and this Agreement. In furtherance of the foregoing, the Parties agree as follows:

 

(a)          Products
Manufactured at Licensee Facilities. Licensee agrees to:

 

(i)          comply
with all applicable laws relating to human rights, wage and labor practices (“Local Laws”) in each jurisdiction
where Licensee manufactures any product or any component thereof that is uniquely or readily associated with one or more products,
the Trademark or the “Martha Stewart” name (collectively, the “Covered Products”);

 

(ii)         disclose
to MSLO the location of any manufacturing facilities owned by Licensee where Covered Products are manufactured (“Licensee
Facilities”); and

 

(iii)        provide
MSLO or its reputable, independent agent that is generally engaged in the business of monitoring compliance with Local Laws (an
“Agent”) access to the Licensee Facilities solely for the purpose of, and to the extent necessary for, verifying
compliance with Local Laws, and, if following any such inspection, MSLO or its Agent notifies Licensee that the relevant Licensee
Facility is not in compliance with Local Laws, Licensee agrees to take reasonable corrective steps in order to return the Licensee
Facility in question to compliance. Any Agent performing services hereunder will enter into such confidentiality arrangements with
Licensee as Licensee reasonably requires. Neither MSLO nor the Agent shall interfere with labor/management relations in any way.

 

(b)          Products
Manufactured at Vendor Facilities. Licensee agrees to:

 

(i)          solely
for the purpose of establishing compliance with Local Laws, disclose to MSLO the identity of suppliers of Covered Products (each
such supplier a “Covered Vendor”) and the locations of facilities where Covered Products are manufactured by
a Covered Vendor;

 

(ii)         require
as a condition to its purchases of Covered Products, that each Covered Vendor sign the Covered Vendor Agreement and comply with
Local Laws in the jurisdictions where such Covered Vendor manufactures Covered Products; and

 

(iii)        provide
MSLO or its Agent access to the Covered Vendor facilities solely for the purpose of, and to the extent necessary for, verifying
compliance with Local Laws, and, if following any such inspection, MSLO or its Agent notifies Licensee that the relevant Covered
Vendor facility is not in compliance with Local Laws, Licensee agrees to take reasonable corrective steps in order to return the
Covered Vendor facility in question to compliance or to move production of the Covered Products to a compliant facility. Any Agent
performing services hereunder will enter into such confidentiality arrangements with Licensee as Licensee reasonably requires.
Neither MSLO nor the Agent shall interfere with labor/management relations in any way.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-26-

    	 

    

 

In furtherance of the foregoing, MSLO and
Licensee will work together in good faith to educate Covered Vendors on the importance of
compliance with Local Laws at all Covered Vendors’ facilities and will work to implement a program intended to enhance such
compliance.

 

25.         Miscellaneous.

 

(a)          No
Agency or Joint Venture. Neither Party shall be or be deemed to be an agent, employee, partner or joint venturer of or for
the other Party, and neither Party has the power to obligate or bind the other in any manner whatsoever.

 

(b)          No
Third-Party Beneficiaries. The parties do not confer any rights or remedies upon any third-party other than the parties to
this Agreement and their respective Affiliates, successors and permitted assigns.

 

(c)          Press
Release. Except to the extent required under applicable law or regulation, the Parties agree that all press releases or other
publicity relating to the existence or substance of the business relationship contemplated herein shall be coordinated between
the Parties and will not be released without mutual agreement. Notwithstanding the foregoing, the Parties agree that the release
or releases announcing the relationship established by this Agreement shall occur at a time reasonably determined by MSLO in light
of its overall merchandising strategy and public disclosure obligations under the federal securities laws, provided that such release
also occurs at a time reasonably determined by Licensee in light of its public disclosure obligations under the federal securities
laws. In addition to the foregoing, but subject to MSLO’s right of review and approval, Licensee shall have the right to
mention the Martha Stewart in press releases in connection with MSLO’s obligations and/or duties under this Agreement.

 

(d)          Severability.
In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable
or void, then such provision shall be interpreted in the manner that best reflects the apparent intentions of the Parties and yet
negates the element that rendered such provision illegal, unenforceable or void, or, if such interpretation is impracticable or
impossible, then this Agreement shall continue in full force and effect without such provision.

 

(e)          Integration.
This Agreement, including the schedules hereto, each of which is incorporated herein, shall be the final and complete agreement
between Licensee and MSLO with respect to the subject matter hereof. No representations, inducements, premises or understandings
exist in relation to the subject matter hereof, whether oral or written, except as expressly set forth herein, and this Agreement
shall supersede all prior understandings, agreements, contracts or arrangements between the Parties, whether oral or written, unless
otherwise expressly incorporated herein. No agreement or other understanding purporting to add to or to modify the terms and conditions
hereof shall be binding unless agreed to by the Parties in writing. Any terms or conditions in any forms of the Parties used in
the performance of this Agreement which are in conflict with the terms and conditions hereof shall be void.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

 

 

    	-27-

    	 

    

 

 

(f)          Remedies
Cumulative. The rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any
rights, powers, remedies and privileges provided at law or in equity.

 

(g)          No
Waiver of Rights. A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed
to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any
subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.

 

(h)          Injunctive
Relief. Licensee acknowledges that the rights granted under this Agreement are of special, unique and intellectual character,
which gives them peculiar value, and that any breach by Licensee of any material term, condition or covenant of this Agreement
will cause irreparable injury to MSLO. Licensee acknowledges that the remedy at law for any breach by Licensee of any material
term, condition or covenant of this Agreement (other than payment obligations hereunder) will be inadequate and, accordingly, in
the event of any breach or threatened breach by Licensee, MSLO shall be entitled, in addition to all other remedies, to seek and
obtain an interlocutory or other preliminary injunction restraining any such breach, without any bond or other security being required.

 

(i)          Counterparts.
This Agreement (and each amendment, modification and waiver in respect thereof) may be executed and delivered in any number of
counterparts (including by facsimile or electronic transmission), with the same effect as if all Parties hereto had signed the
same document. All counterparts shall be construed together and shall constitute one instrument.

 

(j)          Headings.
The headings used in this Agreement are for convenience of reference only and are not to affect the construction of, or to be taken
into consideration in interpreting, this Agreement.

 

[Signature Page Follows]

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

  

    	-28-

    	 

    

 

IN WITNESS WHEREOF, the Parties have executed
this Agreement on the date first above written.

 

	 	MARTHA STEWART LIVING OMNIMEDIA, INC.
	 	 
	 	By:	/s/
	 	 
	 	Name:
	 	Title:
	 	Date:
	 	 
	 	INERGETICS, INC.
	 	 
	 	By:	/s/
	 	 
	 	Name:
	 	Title:
	 	Date:

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-29-

    	 

    

 

SCHEDULES TO AGREEMENT

 

	Schedule 1	Development Calendar
	Schedule 2	Advertising and Marketing Expenditure Schedule
	Schedule 3	Covered Vendor Agreement
	Schedule 4	Projections
	Schedule 5	Approved Retailer List

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-30-

    	 

    

 

Schedule 1

 

Development Calendar

 

[To come]

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

  

    	-31-

    	 

    

 

Schedule 2

 

Schedule of Advertising, Promotion and Marketing
Expenditures

pursuant to Section 9 of this Agreement

 

{***}

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-32-

    	 

    

 

Schedule 3

 

Covered Vendor Agreement

 

[LETTER HEAD OF LICENSEE/APPROVED RETAILER

 

As of ___________, 2013

 

 

Vendor name/address:

 

_______________________

 

_______________________

 

_______________________

 

Attention: ______________

  

		Re:	Martha Stewart Living Omnimedia / Vendor Confidentiality and Proprietary Materials Agreement

 

Dear ______________________:

 

As you know, you may soon be, or have been, manufacturing products
to be sold under a “Martha Stewart” brand (the “Products”). Although these Products will be and/or
have been manufactured by you pursuant to agreements between you and certain vendors or retailers, you recognize that such vendors
or retailers have made this agreement a condition to your manufacturing the Products for them. Accordingly, in consideration of
your selection, or potential selection, to manufacture certain Products, you hereby agree with Martha Stewart Living Omnimedia,
Inc. (“MSO”) as follows:

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-33-

    	 

    

 

1.             Proprietary
Materials.

 

(a)            For
the purposes of this Agreement, “Proprietary Materials” shall mean all

 

(i)          information
or materials (whether or not in tangible form) (A) relating to MSO or Martha Stewart or (B) supplied to you by MSO, its Licensee
or an Approved Retailer (as defined in Paragraph 3 below) in connection with the Products, in each case other than (I) any such
information or material known to you or in your possession prior to the commencement of your discussions regarding the manufacture
of products with any Licensee, Approved Retailer or MSO (as the case may be); (II) any such information or material generally known
to or possessed by the general public (other than as a result of (x) a breach of this agreement by you, (y) distribution of
the Products or (z) the acts of any other party which you know or have reason to know is under an obligation of confidentiality
to MSO); and (III) any such information or material acquired by you from a third party (other than a third party that you know
or have reason to know is under an obligation of confidentiality to MSO or that acquired such information or material as a result
of the distribution of the Products);

 

(ii)         materials
(whether or not in tangible form) that you develop with a Licensee, or Approved Retailer, MSO or with any contribution, input,
advice or direction whatsoever from Licensee, Approved Retailer, or MSO (the “Collaborative Materials”) (for
the sake of clarity, Collaborative Materials shall include the entire applicable material and not just MSO’s contribution,
input, advice or direction with respect thereto); and

 

(iii)        information
or materials (whether or not in tangible form) with respect to which you gain access or knowledge as a direct result of (A) your
relationship with an Approved Retailer, Licensee, and/or MSO in connection with the Products; and/or (B) carrying out any of your
obligations to MSO, Licensee, and/or an Approved Retailer in connection with the Products.

 

(b)          Without
limiting the scope and generality of Paragraph 1(a) above, the Proprietary Materials may, without limitation, include and/or be
comprised of formulations, concepts; techniques; data; documentation; research and development; customer lists; advertising plans;
distribution networks; new product concepts; intellectual property of all types, including, without limitation, ingredients, designs,
patterns, ideas, and any physical manifestations thereof; prints; sketches; planned introduction dates; processes; marketing procedures;
“know-how”; marketing techniques and materials; development plans; names and other information related to strategic
partners, suppliers, or vendors; pricing policies and strategic, business or financial information, including business plans and
financial pro formas.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

  

    	-34-

    	 

    

 

2.             Notwithstanding
the foregoing, the Proprietary Materials (a) shall include any and all information and/or materials of every kind whatsoever in
which MSO, its Licensee, and/or an Approved Retailer owns any proprietary rights whatsoever (including, without limitation, any
copyright rights, trademark rights or other intellectual property rights) related to the products, and (b) shall not include any
information or materials you develop at your sole cost and expense with no contribution, input, advice or direction whatsoever
from MSO (the “Excluded Materials”); provided, however, that no Excluded Materials may in any way contain, embody
or reference any Proprietary Materials, including, without limitation, any MSO trademark, service mark, mark, name or other designation.

 

3.             For
purposes of this Agreement, (i) “Approved Retailers” shall mean those entities set forth on an Exhibit which
will be amended from time to time and (ii), Licensee means the entity that MSO has authorized to manufacture, distribute, and sell
the products featuring a MSO trademark, service mark, name or other designation.

 

4.             You
acknowledge that MSO exclusively owns, in perpetuity and throughout the world, all right, title and interest whatsoever (including,
without limitation, all copyrights, trademarks, patents, trade secrets, and other proprietary rights, and all renewals and extensions
thereof) embodied in or related to the Proprietary Materials, and any and all good will therein. You recognize the great value
of the publicity and good-will associated with the Proprietary Materials, and you acknowledge that such value and good-will belong
exclusively to MSO. You agree that you shall not acquire any rights in or to the Proprietary Materials by virtue of your performance
of any obligations to MSO, Licensee, any Approved Retailer or otherwise. Any use which you may make of the Proprietary Materials
shall solely be pursuant to your agreements with MSO, Licensee, or the Approved Retailers in connection with the products and shall
not restrict, limit or otherwise diminish MSO’s rights therein with respect to any other products or use. You hereby irrevocably
acknowledge and agree that the Collaborative Materials (and all the results and proceeds of your services in connection therewith)
shall be and/or have been solely created by you as a “work-made-for-hire” specially commissioned by MSO and/or its
Licensee/Approved Retailer on behalf of MSO for use in connection with the products pursuant to the United States Copyright Act,
and any and all extensions and/or renewals thereof. In the event any of the Collaborative Materials are determined not to be a
“work-made-for-hire” for MSO, then you hereby irrevocably assign all rights therein exclusively to MSO in perpetuity.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-35-

    	 

    

 

5.             You
hereby represent, warrant and agree as follows: (a) you shall not undertake or cause any third party to undertake any act that
violates, infringes, diminishes, challenges or otherwise conflicts with MSO’s exclusive ownership of all rights, title and
interest in and to the Proprietary Materials, (b) MSO’s exploitation of the Collaborative Materials shall not infringe any
person’s or entity’s proprietary, intellectual property or other rights (including, without limitation, trade secret,
patent, copyright and trademark rights); (c) the products, and all aspects and elements thereof and all materials incorporated
therein or utilized in connection with the design, development, manufacturing, sale, distribution, advertising, marketing and/or
promotion of the products (i) are and shall be free from any claims of infringement of any person’s or entity’s proprietary,
intellectual property or other rights (including, without limitation, trade secret, patent, copyright and trademark rights); (ii)
are and shall be free from defects in design, material and workmanship and are and shall be safe and suitable for their intended
and foreseeable uses; and (iii) are and shall be free from any claim of product liability; and (d) the products shall be formulated,
designed, developed, manufactured, labeled, packaged, sold, distributed, advertised, marketed, promoted and serviced in compliance
with all applicable laws and industry standards.

 

6.             You
agree to defend, indemnify and hold harmless MSO and its affiliated and related persons and entities (including, without limitation,
Martha Stewart), and each of their respective principals, officers, directors, managers, members, shareholders, agents, employees
and representatives (the “MSO Parties”) from and against any claims, actions, demands, penalties, fines, judgments,
lawsuits, costs and expenses (including, without limitation, reasonable outside attorneys’ fees and disbursements) (“Claims”)
arising out of or in connection with (a) the design, development, manufacture, labeling, packaging, sale, distribution, shipment,
advertising, marketing, promotion, servicing and/or other exploitation of the Products (including, without limitation, any (i) product
liability claims; (ii) claims of personal injury, death or property damage; (iii) claims made under any guaranties made or warranties
given (in each case, whether express or implied) with respect to such Products or (iv) any similar or other claim based on strict
liability, negligence or warranty (whether express or implied); (b) your dealings or relationships with any Licensee, Approved
Retailers or third parties and/or the termination of any such relationships; (c) any use by you of the Proprietary Materials in
a manner not authorized by this Agreement; (d) any breach of any your representations, warranties or agreements contained herein;
and/or (e) your negligence or willful misconduct. You shall obtain all insurance customarily obtained by similarly situated companies
selling products similar to the Products.

 

7.             The
Proprietary Materials include, without limitation, all notes, data, reference materials, sketches, drawings, memoranda, documentation
and records (throughout all stages of development and completion) in any way incorporating or reflecting any of the Proprietary
Materials, and the same belong exclusively to MSO and you agree to turn over all copies of such materials in your possession or
control to MSO upon the earlier of MSO’s request or termination of the agreement pursuant to which you manufacture any products.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-36-

    	 

    

 

8.             You
shall hold in confidence and not directly or indirectly reveal, report, publish, disclose or transfer any of the Proprietary Materials
in any form to any person or entity, nor shall you utilize any of the Proprietary Materials for any purpose whatsoever, in each
case except to the limited extent necessary in the course of your permitted manufacture of products hereunder for Licensees and/or
Approved Retailers, provided that no Proprietary Materials which are designated as being “confidential” by MSO may
be revealed, reported, published, disclosed or transferred without the express written consent of MSO. You shall cause each of
your employees, agents or representatives that are provided access to any Proprietary Materials to abide by the same obligations
and restrictions to which you are subject hereunder, and you shall be full responsible and liable for any failure of such employees,
agents or representatives to do so.

 

9.             You
agree that you shall not sell any products incorporating any of the Proprietary Materials to any entity other than MSO, Licensee,
or an Approved Retailer, except as expressly permitted herein.

 

10.           Upon
receipt of a notice from MSO, Licensee, or an Approved Retailer that any Products manufactured by you are deficient in quality
or are not consistent with the relevant specifications, or in the event of an Overrun (as hereafter defined), you may sell such
deficient products or products with respect to which there has been an Overrun (collectively, “Excess Products”)
to parties other than Approved Retailers, provided that (a) no use of or reference to the name Martha Stewart, MSO or any variation
thereof is used in connection with any advertising, publicity, labeling, wrapping or packaging with respect to any such sales;
(b) prior to making any such sale you receive assurances from the party to whom you sell such Excess Products that they will comply,
and will cause any subsequent purchasers to comply, with the terms of clause (a) above; and (c) such sales are made to purchasers
who have warranted to you in writing that they shall only re-sell the Excess Products outside of North America (unless prior approval
for North American sales is received from MSO, Licensee, or the Approved Retailer for whom the Excess Products were originally
manufactured). For purposes of this Agreement, there shall be an “Overrun” on a product only in the event that
(i) you have received notice from all Licensees or Approved Retailers for whom you manufacture such product that such Licensees
or Approved Retailers do not intend to purchase any more of such product from you in the future; (ii) you have delivered to the
relevant Licensees or Approved Retailers and to MSO the amount of product in your possession with respect to which there is an
Overrun; and (iii) MSO and the relevant Licensee and/or Approved Retailers have approved the quantity of such Overrun. MSO, Licensee,
and/or the Approved Retailers may, in their sole discretion, limit the amount of Excess Product you may dispose of pursuant to
the terms of this paragraph if they determine that the amount of such products that you have on hand for such disposal is excessive
and beyond the quantity you would have possessed had you followed a normal and prudent manufacturing schedule.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-37-

    	 

    

 

11.            In
the event that you are required by law, rule or regulation to disclose any Proprietary Materials or you receive a request to disclose
any Proprietary Materials under a subpoena or court order, you will (a) promptly notify MSO thereof; (b) consult with MSO on the
advisability of taking steps to resist or narrow such request; and (c) if disclosure is required or deemed advisable, cooperate
with MSO in any attempt that it may make to obtain an order or other reliable assurance that confidential treatment will be accorded
to designated portions of the Proprietary Materials.

 

12.           Because
of the unique nature of the Proprietary Materials, you understand and agree that MSO, its Licensees, and/or its Approved Retailers
will suffer irreparable harm in the event that you fail to comply with any of your obligations hereunder and that monetary damages
may be inadequate to fully compensate the parties for such breach. Accordingly, you agree that MSO, its Licensees, and/or Approved
Retailers will, in addition to any other remedies available to it at law or in equity, be entitled to injunctive relief, including,
without limitation, temporary restraining orders and/or preliminary injunctions, to enforce the terms of this Agreement. In the
event of any breach or purported breach by MSO, its Licensees, and/or its Approved Retailers hereunder, your rights shall be limited
to an action at law for money damages actually suffered. In no event shall you be entitled to rescission, injunction or other equitable
relief of any kind.

 

13.           In
case any one or more of the provisions (or portions of the provisions) of this Agreement shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions
(or portions of the provisions) of this Agreement and this Agreement shall be construed as if the invalid, illegal or unenforceable
provisions (or portions of the provisions) had never been contained therein.

 

14.           In
the interest of being guided by a well-developed body of law in the event of a dispute, the parties agree that this Agreement,
including the validity and enforceability hereof, shall be interpreted in accordance with the laws of the State of New York pertaining
to agreements made and performed therein, and the courts located in the State of New York, County of New York (federal, if jurisdiction
is present, state, if federal jurisdiction is lacking), shall have exclusive jurisdiction and venue over all disputes hereunder.

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-38-

    	 

    

 

Upon execution hereof by your authorized signatory, this letter
shall constitute a binding agreement between you and MSO’s applicable Licensee or Approved Retailer, enforceable according
to its terms.

 

2

 

	 	 	Sincerely yours,
	 	 	 
	 	 	[NAME OF LICENSEE/APPROVED 
	 	RETAILER]	 
	 	 	[LICENSEE/APPROVED RETAILER] OF
	 	MARTHA STEWART LIVING OMNIMEDIA, INC.

 

	 	By:	 
	 	Name:  	 
	 	Title:	 

 

	ACCEPTED AND AGREED BY:	 
	 	 
	[                                                                    ]	 

 

By: ____________________________

Name: _______________________

Title: ________________________

  

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-39-

    	 

    

 

Schedule 4

 

Projections Guaranteed Minimum Annual
Sales.

 

{***}

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-40-

    	 

    

 

Schedule 5

 

Approved Retailers

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-41-

    	 

    

 

CONFIDENTIAL TREATMENT

 

 

 

Schedule 6

 

Approved Manufacturers

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.

 

    	 

    	 

    

 

CONFIDENTIAL TREATMENT

 

EXHIBIT A

 

	Wire Information:	 

 

{***}

 

 

{***} Confidential portions of this exhibit have been redacted
and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities
Exchange Act of 1934, as amended

 

    	-2-EXECUTIVE EMPLOYMENT AGREEMENT

 

The Employment Agreement is entered into
this 25th day of March, 2013 and effective April 1, 2013 between Axion Power International, Inc., a Delaware corporation,
having a place of business at 3601 Clover Lane, New Castle, Pennsylvania 16105 (the "Company") and Thomas G. Granville
329 Edgebrook Lane, New Wilmington, PA 16105, (the “Executive”).

 

		A.	The Company is engaged in research, development, manufacturing and sales relating to a novel technology for a supercapacitor/battery
hybrid that replaces the lead-based negative electrode in a lead-acid battery with a highly permeable nanoporous carbon electrode;
and in research, development, manufacturing and sales relating to both conventional and advanced lead acid batteries including
new grid technologies for the positive and potentially the negative lead and carbon additives to the standard lead acid battery;
and is exploring various other integration technologies for stationary and motive applications.

 

		B.	The Company owns all of the proprietary interests in the Company's good will and its Confidential Information (as hereinafter
defined), all of which information is not publicly available and is considered by the Company to be confidential trade secrets.
The Company imparts to its Employees, and said Employees require during the course of their employment, access to Confidential
Information.

 

		C.	Executive during the course of employment with the Company: (i) will obtain material knowledge and information regarding the
Company's Customers, including without limitation Customers' specialized requirements, preferences and financial condition, all
of which are materially important in the Company's business relationship with such Customers; (ii) may perform duties for the Company,
which duties themselves are of a highly confidential nature; (iii) is encouraged by the Company to develop personal relationships
with the Company's suppliers, Customers and prospective Customers; (iv) generally has access to Confidential Information; and (v)
has developed and will develop expertise in the field of lead-acid batteries, Axion's PbC Technology, battery testing, carbon sheeting,
and other technologies currently under development by Axion.

 

		D.	The Company is vulnerable to unfair post-employment competition by Executive, since Executive has access to Confidential Information
and has personal relationships with the Company's suppliers, Customers and prospective Customers.

 

		E.	Executive acknowledges the vulnerability of the Company to post-employment competition by Executive and is willing to enter
into this Agreement with the Company, pursuant to which Executive agrees not to disclose any of the Company's Confidential Information
and not to compete against the Company following termination of employment for the time periods and to the limited extent set forth
in this Agreement.

 

		F.	The Company desires to employ Executive as its Chief Executive Officer and Executive desires to accept such employment, pursuant
to the terms set forth in this Agreement.

 

    	 

    	 

    

 

NOW, THEREFORE, in consideration of the promises and
of the mutual covenants and agreements herein contained, the parties hereto agree as follows:

 

		1)	Executive Representations and Warranties. The Executive represents and warrants to the Company that he is free to accept
employment hereunder and that he has no prior or other obligations or commitments of any kind to anyone that would in any way hinder
or interfere with his acceptance of the full, uninhibited and faithful performance of this Agreement, or the exercise of his best
efforts as an Executive of the Company.

 

		2)	Employment and Duties. The Company shall employ the Executive as its Chief Executive Officer. The Executive will work
from the Company's office and battery manufacturing center in the New Castle, Pennsylvania area and will report directly to the
Company’s Board of Directors. The Executive’s responsibilities shall include all of the duties and responsibilities
of the Chief Executive Officer with such executive duties and responsibilities consistent with such positions and stature as the
Board of Directors of the Company may from time to time determine.

 

		3)	Conduct of Executive. During the entire Term of this Agreement, the Executive shall devote his full business time, effort,
skill and attention to the affairs of the Company and its subsidiaries, will use his best efforts to promote the interests of the
Company, and will discharge his responsibilities in a diligent and faithful manner, consistent with sound business practices. In
furtherance of the foregoing:

 

		a)	The Executive understands and agrees that he owes the Company a fiduciary duty, without limiting any other obligations or requirements
that are imposed on the Executive by this Employment Agreement or by law. As such, the Executive shall occupy a position of and
commit to the highest degree of trust, loyalty, honesty and good faith in all of his dealings with and on behalf of the
Company.

 

		b)	The Executive represents that his employment by the Company will not conflict with any obligations which he has to any other
person, firm or entity. The Executive specifically represents that he has not brought to the Company (during the period before
the signing of this Agreement) and he will not bring to the Company any materials or documents of a former or present employer,
or any confidential information or property of any other person, firm or entity.

 

		c)	The Company does not offer, pay, or receive payments in exchange for the referral of a customer. The Executive shall not receive
any remuneration from any outside person or entity related to the services performed by the Executive for the Company or the products
purchased or sold by the Company.

 

		d)	The Executive shall comply with all applicable laws, including Federal, State and Municipal purchasing requirements. The Executive
understands that failure to do so exposes the Company, its officers, directors, Executives and agents to possible sanctions, monetary
penalties, criminal prosecution and other disciplinary actions. The Executive shall seek appropriate guidance from the Company
when the application of a law is unclear.

 

    	 

    	 

    

 

		4)	Conditions of Employment. 

 

		a)	Term of Employment. Unless terminated earlier in accordance with the provisions of this Agreement, the Company will
employ the Executive for a period commencing on April 1, 2013 and terminating on June 30, 2016 (the “Term”).

 

In determining whether to continue to term the employment
of any Executive Officer, the board will use as a metric, the failure of the Company to meet at least 75% of its Total
Net Sales and EBITDA projections for any prior six month period beginning January 1, 2014. Such projections
will be published and made available to the board no later than the 10th day prior to each six month period beginning on January
1 and including June 1 of the applicable calendar years. In determining accountability for the failure to reach
such projections, the board shall make exceptions for an Act of God, or a failure of a single source supplier to meet
its supply commitments due to an act unforeseeable by the Company and unavoidable to remedy due to an unavoidable inability
to establish an alternate second supplier of the item, or any other event that the board deems completely beyond the
control of the Company. 

 

		b)	Place of Employment. The Executive shall occupy offices at the Company's facility in New Castle, PA. The Executive shall
not be required to relocate to any other business location maintained by the Company although the Executive expressly agrees that
regular travel shall be necessary as part of his duties.

 

		c)	Ownership of Company Records and Reports. The Executive shall not, except in the performance of his duties hereunder,
at any time or in any manner make or cause to be made any copies, pictures, duplicates, facsimiles, or other reproductions or recordings
or any abstracts or summaries of any reports, studies, memoranda, correspondence, manuals, records, plans or other written or otherwise
recorded materials of any kind whatever belonging to or in the possession of the Company, or of any subsidiary or affiliate of
the Company, including but not limited to materials describing or in any way relating to the Company's business activities including,
but not limited to, its proprietary techniques and technologies, its operational and financial matters, its business and financial
and development plans, its personnel training and development programs and its industry relationships. The Executive shall have
no right, title or interest in any such material, and the Executive agrees that, except in the performance of his duties hereunder,
he will not, without the prior written consent of the Company remove any such material from any premises of the Company, or any
subsidiary or affiliate of the Company, and immediately upon the termination of his employment for any reason whatsoever Executive
shall return to the Company all such material in his possession.

 

		d)	It is expressly agreed and understood that the Executive shall execute and be bound by the terms and conditions of the Executive
Agreement which is attached hereto and made a part hereof as Exhibit A.

 

    	 

    	 

    

 

		5)	Compensation. 

 

		a)	The Company shall compensate the Executive for all services to be rendered by him during the Term as follows:

 

		b)	The Executive shall receive an annualized salary of $380,000.00, paid on a regular basis according to company payroll practice
which at the time of signing is bi-weekly (subject to change) for services rendered during the period commencing on April 1, 2013
and terminating on March 31, 2016. The Executive's salary shall be reviewed on an annual basis. The amount of such Salary shall
be eligible for adjustment, if any, subject to renegotiation based on the performance of the Executive and the performance of the
Company. The Executive will also be eligible for 2013 cash and option bonus awards, based on plans, programs and/or milestones
established by the CEO on advice and consent from the Compensation Committee of the Board of Directors with input from the Chief
Operating Officer and the Executive. Both of these determinations will be made in writing within 45 days of the execution of this
agreement.

 

In addition, The Executive shall be allowed an automobile
allowance of $750.00 per month to be applied to the car of his choice. The Executive shall be entitled to reimbursement at the
maximum allowable mileage rate under applicable income tax rules for all reasonable business use of his personal vehicle.

 

		c)	During the term of this agreement, the Company will reimburse the Executive for all reasonable business expenses incurred by
him on behalf of the company in the performance of his duties hereunder upon presentation of vouchers, receipts or other evidence
of such expenses in accordance with the policies of the Company, and provided that Executive shall incur no expenses that exceed
$2,500.00 without prior authorization of the Company.

 

		d)	As partial compensation for the execution  of this Agreement and in consideration of the level of compensation paid to
the Executive since April, 2010, the Company will pay the Executive a  stipend   as an  additional  inducement
to retain the services of the Executive  over the term of this Agreement as follows :

		i)	Upon execution of the Agreement , the Executive will be paid $38,000 (Thirty Eight Thousand dollars), subject to normal withholdings
and deductions within 45 days following the execution of this Agreement:

		ii)	Provided the Executive is an employee in good standing in the position of Chief Financial Officer on April 1, 2014 , the Executive
will be paid a stipend  of  $38,000 (Thirty Eight Thousand dollars), subject to normal withholdings and deductions
on the first regularly scheduled payroll following April 30, 2014;

		iii)	Provided the Executive is an employee in good standing in the position of Chief Financial Officer on April 1, 2015 , the Executive
will be paid a stipend  of  $38,000 (Thirty Eight Thousand dollars), subject to normal withholdings and deductions
on the first regularly scheduled payroll following April 30, 2015:

		iv)	Provided the Executive is an employee in good standing in the position of Chief Financial Officer on April 1, 2016 , the Executive
will be paid a stipend  of  $38,000 (Thirty Eight Thousand dollars), subject to normal withholdings and deductions
on the first regularly scheduled payroll following April 30, 2016

 

		e)	The Executive shall participate in any Executive compensation plans adopted by the shareholders of the Company; provided, however,
that the discretionary authority to determine the level of the Executive's participation therein and the terms and conditions of
such participation shall remain vested in the CEO and the Compensation Committee of the Board of Directors and the Compensation
Committee shall have the authority to adjust such participation upward or downward from time to time in its sole discretion.

 

    	 

    	 

    

 

		f)	During the Term of this Agreement, the Company will reimburse the Executive for all reasonable business expenses incurred by
him on behalf of the Company in the performance of his duties hereunder upon presentation of vouchers, receipts or other evidence
of such expenses in accordance with the policies of the Company.

 

		d)	Notwithstanding any other provision of this Agreement, it is agreed that the Executive shall be entitled to receive such incentive
bonuses, stock options and other benefits as the Compensation Committee of the Board of Directors may grant from time to time,
and any income tax liabilities arising there from shall be due and payable at the Executive's sole expense, and the Executive acknowledges
that the Company may make appropriate withholding from salary for such grants.

 

		e)	Benefits. During the Employment Period, Executive shall be entitled to the benefits approved by the Board or any of
the Executive Officers; as such benefits may be adjusted by the Board or any of the Executive Officers from time to time in their
sole and absolute discretion. Upon termination of the Employment Period, benefits for periods subsequent to such termination shall
cease. Executive will be entitled to four (4) weeks paid vacation per full year of employment to be given and accrued
as set forth in the Company employee handbook.

 

		f)	Health Benefits. Executive and his qualifying family members will be eligible to participate in the Company's health benefit
plans, as may be in effect from time to time at the sole discretion of the Company, provided that the permanent residence of each
person receiving benefits is in the New Castle, PA area. More information is available from Human Resources.

 

		g)	Deductions, Taxes and Withholding. All amounts payable or which become payable hereunder shall be subject to any deductions
authorized by Executive, any set-off or reimbursement deemed appropriate by the Company and permitted by law and any deductions
or set-offs permitted by this Agreement and all deductions and withholding authorized by law. Executive is responsible for payment
of all taxes related to Executive's compensation, whether cash or equity compensation or otherwise.

 

		h)	Termination of Employment. 

		a.	This Agreement and the compensation payable to Executive hereunder shall terminate and cease to accrue forthwith upon Executive's
death.

 

		b.	If the Executive's employment is terminated (i) other than for cause (as defined below) by the Company, or (ii) by the
Executive for good reason (as defined below), the Company shall pay to Executive an aggregate severance amount equal to
Fifty per cent (50%) of the Executive's annual base salary in effect as of the date of such termination (i.e., six months'
base salary and such amount being referred to as the "Severance Amount"). The Severance Amount may be paid in
as part of the regular ongoing payroll for the specified time, provided that payment of the Severance Amount shall be contingent
upon the Executive signing the release and waiver agreement in Exhibit B.

 

    	 

    	 

    

 

For the purposes of this Agreement, "cause" for termination
by the Company shall mean (i) a material breach of this Agreement by Executive; (ii) a breach of Executive's duty of loyalty to
the Company or any act of dishonesty with respect to the Company or its stockholders, customers or suppliers; (iii) Executive's
continued failure or refusal to perform, in any material respect, any duty or responsibility to the Company which is normally attached
to Executive's position(after notice and a 10-day cure period), provided, however, any subsequent failure or refusal to perform
such duty or responsibility shall entitle the Company to terminate employment for Just Cause without notice or an opportunity to
cure; (iv) Executive's gross negligence or willful misconduct in performing those duties which are normally attached to Executive's
position; (v) the commission by Executive of an act of fraud, conversion, misappropriation (including the unauthorized use or disclosure
of confidential or proprietary information of the Company) or embezzlement or crime of moral turpitude; (vi) a conviction of or
guilty plea or confession by Executive to any fraud, conversion, misappropriation, embezzlement or felony; (vii) the exposure of
the Company to any criminal liability or loss of business opportunity or reduction in revenues or increase in losses substantially
caused by the conduct of Executive which results in a material adverse effect upon the Company's business, operations, financial
condition or results of operations or the exposure of the Company to any bona fide claims which may result in civil liability caused
by Executive's unlawful harassment in employment; or (viii) the repeated taking of any action prohibited (a) by the Board or any
of the Executive Officers, provided that Executive has received at least one written notice of having taken an action so prohibited,
or (b) by this Agreement. For purposes of this Agreement, "Executive's duty of loyalty to the Company" shall include
Executive's fiduciary obligation to place the interests of the Company ahead of Executive's personal interests and thereby not
knowingly profit personally at the expense of the Company, and shall also include specifically the affirmative obligation to disclose
promptly to the Board any known conflicts of interest Executive may have with respect to the Company, and the negative obligations
not to usurp corporate opportunities of the Company, not to engage in any "conflict-of-interest" transactions with the
Company (without the approval of the Board), and not to compete directly with the Company (without the approval of the Board).
Good Reason shall mean the occurrence or failure to cause the occurrence, as the case may be, without your express written consent,
of any of the following circumstances: (i) material demotion (except in connection with the termination of your employment for
Cause or as a result of your death, or temporarily as a result of your illness or other absence), (ii) a relocation of the Company's
executive office in New Castle, PA to a location more than 70 miles from its current location; (iii) any material breach by the
Company of any provision of this Agreement; or (iv) failure of any successor to the Company (whether direct or indirect and whether
by merger, acquisition, consolidation or otherwise) to assume in a writing delivered to you upon the assignee becoming such, the
obligations of the Company hereunder.

 

		c.	During the term of this agreement, the Executive’s employment may be terminated by either party for any reason, or for
no reason, upon written notice given not less than ten (10) days prior to the termination date. Severance payment will not be owed
if Executive chooses to leave the Company for any reason not initiated by the Company.

 

		d.	At the end of the term of this Agreement, the Executive’s employment may be terminated by either party for any reason,
or for no reason, upon written notice given not less than ninety (90) days prior to the termination date. Non-renewal of contract
is not grounds for being eligible for a severance payment.

 

    	 

    	 

    

 

		i)	Specific Performance. 

If any portion of this Agreement is found by a court of competent
jurisdiction to be too broad to permit enforcement of such restriction to its full extent, then such restriction shall be enforced
to the maximum extent permitted by law, and the Executive hereby consents and agrees that such scope may be judicially modified
accordingly in any proceeding brought to enforce such restriction. All provisions of this Agreement are severable, and the unenforceability
or invalidity of any single provision hereof shall not affect any remaining provision. The Executive acknowledges and agrees that
the Company's remedy at law for any breach of any of his obligations hereunder would be inadequate, and agrees and consents that
temporary and permanent injunctive relief may be granted in any proceeding that may be brought to enforce any provision of this
Agreement without the necessity of proof of actual damage and without any bond or other security being required. Such remedies
shall not be exclusive and shall be in addition to any other remedy which the Company may have.

 

		j)	Miscellaneous:

 

		a.	The failure of a party to insist on any occasion upon strict adherence to any Term of this Agreement shall not be considered
to be a waiver or deprive that party of the right thereafter to insist upon strict adherence to that Term or any other Term of
this Agreement. Any waiver must be in writing.

 

		b.	All notices and other communications under this Agreement shall be in writing and shall be delivered personally or mailed by
registered mail, return receipt requested, and shall be deemed given when so delivered or mailed, to a party at such address as
a party may, from time to time, designate in writing to the other party.

 

		c.	Notwithstanding the termination of the Executive's employment hereunder, the provisions of Paragraphs 6, 7, 8 and 9 survive
such termination.

 

		d.	This Agreement shall be assigned to and inure to the benefit of and be binding upon, any successor to substantially all of
the assets and business of the Company as a going concern, whether by merger, consolidation, liquidation or sale of substantially
all of the assets of the Company or otherwise.

 

		e.	This Agreement constitutes the entire Agreement between the parties regarding the above matters, and each party acknowledges
that there are no other written or verbal Agreements or understandings relating to such subject matter between the Executive and
the Company or between the Executive and any other individuals or entities other than those set forth herein. No amendment to this
Agreement shall be effective unless it is in writing and signed by both the parties hereto.

 

		f.	This agreement shall remain confidential between the parties and not disclosed to anyone unless agreed to by both parties or
otherwise required under law.

 

		g.	Paragraph 6 of this Agreement shall be construed in accordance with the General Corporation Law of Delaware. All other provisions
of this Agreement shall be construed according to the laws of the Commonwealth of Pennsylvania pertaining to Agreements formed
and to be formed wholly within the Commonwealth of Pennsylvania. The Executive represents and warrants that he has reviewed this
Agreement in detail with his legal and other advisors, as he considers appropriate, and that he fully understands the consequences
to him of its provisions. The Executive is relying on his own judgment and the judgment of his advisors with respect to this Agreement.

 

    	 

    	 

    

 

		h.	In the event a dispute arises out of, in connection with, or with respect to this Agreement, or any breach thereof, such dispute
shall, on the written request of one party delivered to the other party, be submitted to and settled by binding arbitration before
a single arbitrator conducted in New Castle, Pennsylvania, United States in accordance with the Laws of the Commonwealth of Pennsylvania.
The award of such arbitrator shall be final and may be entered by any party hereto in any court of competent jurisdiction. The
party against whom the arbitrator's award is rendered shall pay all costs and expenses of such arbitration, unless the arbitrator
shall specifically allocate costs in a different manner because the award is not entirely in favor of either party.

 

		i.	This Agreement may be executed in any number of counterparts, which will each be deemed to be an original for all purposes
hereof.

 

IN WITNESS WHEREOF, the parties have signed this Agreement intending
to be bound thereby.

 

AXION POWER INTERNATIONAL, INC.

 

	/s/ D. W. Wainwright	 	4/3/2013
	D.W. Wainwright, Chairman of the	 	Date signed
	Compensation Committee, Board of Directors	 	 
	 	 	 
	/s/ Thomas Granville	 	3/25/2013
	Executive Signature	 	Date signed
	 	 	 
	 	 	 
	Executive Printed Name	 	 

 

 

    	 

    	 

    

 

EXHIBIT A

 

Executive Agreement

 

AXION POWER INTERNATIONAL, INC.

 

EXECUTIVE AGREEMENT

 

	Granville	 	Thomas	 	G.
	EXECUTIVE’S LAST NAME	 	FIRST NAME	 	INITIAL

 

		A)	DEFINITIONS

 

		1)	AXION means Axion Power International, Inc., and any existing or future subsidiaries, owned or controlled, directly
or indirectly by Axion.

 

		2)	CONFIDENTIAL INFORMATION means information, not generally known, and proprietary to Axion, including trade secret information,
about Axion's processes and products, including information relating to research, development, manufacture, purchasing, accounting,
engineering, marketing, merchandising, selling, leasing, servicing, finance and business systems and techniques. All information
disclosed to me, or to which I have reasonable basis to believe to be Confidential Information, or which is treated by Axion as
being Confidential Information, shall be presumed to be Confidential Information.

 

		3)	INVENTIONS means discoveries, improvements and ideas (whether or not shown or described in writing or reduced to practice)
and works of authorship, whether or not patentable or copyrightable, (1) which relate directly to the business of Axion, or (2)
which relate to Axion’s actual or demonstrably anticipated research or development, or (3) which result from any work performed
by me for Axion, or (4) for which equipment, supplies, facility or trade secret information of Axion is used, or (5) which is developed
on any Axion time.

 

		4)	CONFLICTING PRODUCT means any product, process, system or service of any person or organization other than Axion, in
existence or under development, which is the same as or similar to or competes with, or has a usage allied to, a product, process,
system or service upon which I work (in either a sales or a non-sales capacity) during the last three years of my employment by
Axion, or about which I acquire Confidential Information

 

		5)	CONFLICTING ORGANIZATION means any person or organization which is

engaged in or about to become engaged in, research on or development, production, marketing, leasing, selling or servicing of a
Conflicting Product.

 

    	 

    	 

    

 

		B)	Agreement

 

I AM EMPLOYED OR DESIRE TO BE EMPLOYED BY AXION IN A CAPACITY
IN WHICH I MAY RECEIVE OR CONTRIBUTE TO CONFIDENTIAL INFORMATION. IN CONSIDERATION OF SUCH EMPLOYMENT OR CONTINUED EMPLOYMENT,
AND THE WAGES OR SALARY AND OTHER EXECUTIVE BENEFITS IN COMPENSATION FOR MY SERVICES, AND IN CONSIDERATION OF BEING GIVEN ACCESS
TO CONFIDENTIAL INFORMATION; I AGREE THAT:

 

		1)	With respect to Inventions made, authorized or conceived by me, either solely or

 

		2)	jointly with others, (1) during my employment, whether or not during normal working hours or whether or not at Axion's premises;
or (2) within one year after termination of my employment, I will:

 

		a)	Keep accurate, complete and timely records of such Inventions, which records shall be Axion property and be retained on Axion's
premises.

 

		b)	Promptly and fully disclose and describe such Inventions in writing to Axion.

 

		c)	Assign (and I do hereby assign) to Axion all of my rights to such Inventions and to applications for letters patent and/or
copyright in all countries and to letters patent and/or copyrights granted upon such Inventions in all countries,

 

		d)	Acknowledge and deliver promptly to Axion (without charge to Axion but at the expense of Axion) such written instruments and
to do such other acts as may be necessary in the opinion of Axion to preserve property rights against forfeiture, abandonment or
loss and to obtain and maintain letters patent and/or copyrights and to vest the entire right and title thereto in Axion.

 

		e)	At the request of Axion and at its cost, the Executive shall assist Axion, or any person or persons from time to time designated
by it, to obtain the copyright, trademark and/or grant of patents in the United States and/or in such other country or countries
as may be designated by Axion, covering such improvements, discoveries, ideas and inventions and shall in connection therewith
and in connection with the defense of any patents execute such applications, statements or other documents, furnish such information
and data and take all such other action (including, but not limited to, the giving of testimony) as Axion may from time to time
reasonably request.

 

NOTICE: This is to notify you that paragraph A of this
Axion "Executive Agreement" you are being asked to sign as a condition of your employment does not apply to an Invention
for which no equipment, supplies, facility or trade secret information of Axion was used and which was developed entirely on your
own time, and (1) which does not relate (a) directly to the business of Axion or (b) to Axion's actual or demonstrably anticipated
research or development, or (2) which does not result from any work performed by you for Axion. If any exists, a detailed
list of it should be attached to this agreement as an addendum.

 

    	 

    	 

    

 

		3)	EXCEPT as required in my duties to Axion, I will never, either during my employment by Axion or thereafter, use or disclose
any Confidential Information as defined in paragraph 2 hereinabove.

 

		4)	UPON termination of my employment with Axion, all records and any compositions, articles, devices, and other items which
disclose or embody Confidential Information including all copies or specimens thereof in my possession, whether prepared or made
by me or others, will be left with Axion.

 

		5)	EXCEPT as listed at the end of this Agreement, I will not assert any rights under any Inventions as having been made,
conceived, authored or acquired by me prior to my being employed by Axion.

 

		6)	FOR a period of two years after termination of my employment with Axion:

 

		a)	I will inform any new employer, prior to accepting employment of the existence of this Executive agreement and provide such
employer with a copy thereof.

 

		b)	If I have been or am employed by Axion in a sales capacity, I will not render services in the United States, directly or indirectly,
to any Conflicting Organization in connection with the development, manufacture, marketing, sale, merchandising, leasing, servicing
or promotion of any Conflicting Product to any person or organization upon whom I called, or whose account I supervised on behalf
of Axion, at any time during the last three years of my employment by Axion.

 

		c)	If I have been or am employed by Axion in a non-sales capacity, I will not render, to any Conflicting Organization, services,
directly or indirectly, in the United States or in any country in which Axion has a plant for manufacturing a product upon which
I work during my employment by Axion or in which Axion provides a service in which I participate during my employment by Axion,
except that I may accept employment with a large Conflicting Organization whose business is diversified (and which has separate
and distinct divisions), and which as to part of its business is not a Conflicting Organization, provided Axion, prior to my accepting
such employment, shall receive separate written assurances satisfactory to Axion from such Conflicting Organization and from me,
that I will not render services directly or indirectly in connection with any Conflicting Product.

 

		d)	If I am unable to obtain employment consistent with my abilities and education, within one month after termination of my employment
with Axion, solely because of provisions of this paragraph, such provisions shall thereafter continue to bind me only as long as
Axion shall make payments to me equal to my monthly base pay at termination (exclusive of extra compensation, bonus or Employee
benefits) for each month of such unemployment commencing with the second month after termination of my employment with Axion.

 

    	 

    	 

    

 

		1)	I agree that I will, during each month of such unemployment, make conscientious and aggressive efforts to find employment;
and I will, within ten days after the end of each calendar month, give Axion a detailed written account of my efforts to obtain
employment. Such account will include a statement by me that although I aggressively sought employment, I was unable to obtain
it solely because of the provisions of this Agreement.

 

		2)	It is understood that Axion shall, at its option, be relieved of making a monthly payment to me for any month during which
I failed to seek employment conscientiously and aggressively, and to account to Axion, as provided for above.

 

		3)	Axion is obligated to make such payments to me, upon my fulfillment of the conditions set forth above, for 23 consecutive months
unless Axion gives me written permission to accept available employment, or gives me a written release from the obligations of
paragraph E.

 

		4)	Axion's obligation to make such monthly payments shall terminate upon my death or upon my obtaining employment. I agree that
I will give prompt

written notice of such employment to Axion.

 

		5)	Axion shall not be liable, under this Agreement, or in any action relating thereto, for any amount greater than the equivalent
of 23 such monthly payments, less amounts paid to me by Axion pursuant to this Agreement; Axion not being obliged to make a payment
to me for the first month of such unemployment.

 

		e)	If, after termination of my employment with Axion, I obtain other employment but because of the provisions of paragraph E,
my position is such that my gross monthly income will be less than that which I last received from Axion as monthly base pay at
termination, then Axion’s obligations to make payments to me for the period specified in paragraph E, d. I will be limited
to the difference between my monthly base pay at Axion, at termination, and the gross monthly income I will receive in my subsequent
employment (6), d),1)).

 

		f)	ALL MY obligations under paragraphs A through D of this Agreement shall be binding upon my heirs, spouses, assigns and legal
representatives.

 

		g)	IF ANY provision of this Agreement shall contravene any statute of a particular state which I perform services for Axion, then
this Agreement shall be construed as if such provision is not contained herein insofar as enforcement of this Agreement against
me in such particular state is concerned.

 

		h)	THIS AGREEMENT replaces any existing Agreement entered into by me and Axion relating generally to the same subject matter;
but such replacement shall not affect rights and obligations of either party arising out of any such prior Agreement which shall
then continue to be in effect for that purpose.

 

    	 

    	 

    

 

IN WITNESS WHEREOF, the parties have signed this Agreement intending
to be bound thereby.

 

AXION POWER INTERNATIONAL, INC.

 

	/s/ D. W. Wainwright	 	4/3/2013
	D. W. Wainwright, Chairman of the	 	Date signed
	Compensation Committee, Board of Directors	 	 
	 	 	 
	/s/ Thomas Granville	 	3/25/2013
	Executive Signature	 	Date signed
	 	 	 
	 	 	 
	Executive Printed Name	 	 

 

    	 

    	 

    

 

Exhibit B

 

Sample SEPARATION AGREEMENT AND RELEASE

 

AXION POWER INTERNATIONAL,
INC. and AXION POWER BATTERY MANUFACTURING, INC. (“Employer”), and ___________ (“Executive”)
hereby agree that:

 

1.          Separation
Date. Executive’s last day of employment with Employer shall be (insert date) (the “Separation Date”).
Executive and Employer agree that Executive’s separation from Employer is by mutual agreement. Executive shall have no duty
to report to work after the Separation Date.

 

2.          Return
of Company Property and Confidential Information. On or before the Separation Date, Executive shall return all property
of Employer (whether owned, leased or otherwise belonging to Employer) in her possession or under her control or in the possession
or control of a third party at her direction, including, but not limited to, keys, access cards, company credit cards, cell phones,
blackberry devices, documents, records, paper and electronic files (including computer disks, thumb drives, etc.). Executive specifically
agrees to return any and all confidential and/or proprietary information of the Employer in Executive possession, custody or control,
including, without limitation, trade secrets, policy and procedure manuals, customer lists and contact information, customer preferences
and specifications, other confidential customer data, supplier and vendor lists and other confidential supplier and vendor information,
sales and marketing information, business plans, business development reports, marketing strategies, computer processes and programs,
computer software, software designs and code, computer reports, cost and pricing data, financial information, worksheets, ledgers,
accounts, memoranda, correspondence, reports, profit information, financial data, drawings, engineering, product or process specifications
and documentation, customer and client proposals, techniques and systems, productivity reports, status reports, conference reports,
project cost estimates, project change orders, project cost analyses, invoices, unpublished designs, patterns and prospective trade
identification, employee compensation data, production processes, improvements, developments, designs and technologies, and any
other information or knowledge concerning the Employer, its customers, and its business or methods of doing business, whether or
not in tangible form, that is of a proprietary and/or confidential nature, and/or has been heretofore or hereafter will be treated
as confidential or secret by Employer (hereinafter collectively referred to as “Confidential Information”). By signing
this Agreement, Executive hereby represents and warrants that all such Confidential Information and other Employer property have
been returned to Employer, and that Executive has not retained any such Confidential Information or Employer property or any copies
thereof.

 

3.          Consideration
by Employer. In consideration for signing this Separation Agreement and Release and compliance with promises made herein,
Employer agrees:

 

		a.	Contract Requirements. In accordance with
section 7(c) of your employment agreement, Axion can terminate your employment without good reason at any time with Two (2) weeks
written notice. Your employment is hereby terminated on (insert date). You will receive Twenty six (26) weeks of pay in the amount
of $(xx,xxx.xx) in your final paycheck for the period ending (insert date) which will be mailed to your home address on (insert
date).

 

    	 

    	 

    

 

		b.	Severance. To pay to Executive a severance
in the amount of $ (____.__) in one lump sum, subject to regular payroll withholdings and deductions, on the first regular pay
date following the expiration of the 7-day revocation period more fully described in paragraph 16 of this Agreement, provided
that the Employer has received this Agreement signed by Executive, and that Executive has not exercised her revocation rights
under paragraph 16.

 

4.          Payments
as Consideration. Executive understands and agrees that he/she
would not be entitled to receive severance monies specified in Paragraph 3 above, except for her execution of this Separation Agreement
and Release and the fulfillment of the promises contained herein.

 

5.          Non-Disclosure.
Executive acknowledges that in the course of performing services for the Employer, Executive had access to, developed and/or contributed
certain Confidential Information, as defined above, concerning the Employer and its business. Executive hereby covenants and agrees
that he/she shall not directly or indirectly, at any time prior or subsequent to the Separation Date, disclose, divulge, disseminate,
publish, furnish or make accessible to any third party, or use for Executive’s own personal or professional purposes, profit
or benefit, any of the Employer’s Confidential Information.

 

6.          Assignment.
The rights and protections of the Employer shall extend to any of its successors or assigns and this Agreement may be assigned
without Executive’s consent.

 

7.          Taxes.
Executive is, and hereby agrees, to be responsible for the payment of any and all federal, state, and/or local taxes which may
be payable on the consideration paid for this Agreement. Executive agrees to indemnify and hold harmless the Employer and its insurers,
individually or collectively, from and against any and all claims for federal, state and/or local taxes which may be payable on
the consideration paid for this Agreement. Executive expressly acknowledges that the Employer has not made, nor herein makes, any
representation about the tax consequences of any consideration provided by the Employer to Executive pursuant to this Agreement,
and Executive represents and agrees that he/she is not relying on the advice of the Employer or its attorneys as to the legal,
tax, or other consequences of this Agreement.

 

8.          Release.
In consideration of the payments referenced in paragraph 3, Executive hereby releases, remises and forever discharges Employer,
including its shareholders, directors, officers, employees, agents, predecessors, successors, parent companies, affiliates, subsidiaries,
assigns, attorneys and insurers from any and all claims, damages, demands, causes of action, suits, debts due, and sums of money
of whatever kind and nature which Executive ever had, could have in the future, or now has against Employer arising out of or in
any way related to or resulting from Executive’s employment with Employer and/or the cessation thereof. Executive knowingly
and voluntarily releases and forever discharges Employer from any and all claims that he/she has or may have against Employer as
of the date of her execution of this Separation Agreement and Release, including, but not limited to, any alleged violation of
Title VII of the Civil Rights Act of 1964, as amended; The Civil Rights Act of 1991; Sections 1981 through 1988 of Title 42 of
the United States Code, as amended; The Employee Retirement Income Security Act of 1974, as amended; The Immigration Reform and
Control Act, as amended; The Americans with Disabilities Act of 1990, as amended; The Age Discrimination in Employment Act of 1967
(“ADEA”), as amended; The Older Workers Benefit Protection Act; The Worker Adjustment and Retraining Notification Act,
as amended; The Occupational Safety and Health Act, as amended; The Family and Medical Leave Act; The Fair Labor Standards Act;
The Vocational Rehabilitation Act of 1973; The Equal Pay Act; The Pennsylvania Human Relations Act, as amended; The Pennsylvania
Wage Payment and Collection Law, as amended; The Pennsylvania Minimum Wage Act, as amended; The Pennsylvania Equal Pay Law, as
amended; any other federal, state or local civil or human rights law or any other local, state or federal constitution, statute,
regulation or ordinance; any public policy, contract, tort, or common law; or any claim for costs, fees, or other expenses including
attorneys’ fees.

 

    	 

    	 

    

 

9.          No
Claim Exists. Should Executive file any charge or complaint on his/her own behalf or participate in any charge or complaint
which may be made by any other person or organization on her behalf before any federal, state, or local court or administrative
agency against Employer, Executive agrees that he/she will not accept any relief or recovery therefrom. Executive confirms that
no charge, complaint or action exists in any forum or form.

 

10.         Waiver
of Right to Assist. Executive understands that if this Agreement were not signed, Executive would have the right to voluntarily
assist other individuals or entities in bringing claims against Employer. Executive hereby waives that right and he/she will not
provide any such assistance other than assistance in an investigation or proceeding conducted by the United States Equal Employment
Opportunity Commission or as otherwise required by law.

 

11.         Confidentiality.
Executive and Employer recognize and acknowledge their mutual interests in maintaining the confidentiality of this Agreement, and
agree that each shall keep the fact and terms of this Agreement and the discussions leading to this Agreement strictly confidential.
Executive and Employer promise and agree not to disclose, either directly or indirectly, in any manner whatsoever, any information
of any kind regarding the terms and amounts paid under this agreement, to any person or organization, including but not limited
to representatives of local, state or federal agencies, present and former officers, employees and agents of Employer, and other
members of the public. The parties agree that the unauthorized disclosure of the existence or terms of this Agreement shall be
considered a material breach of this Agreement, that such breach shall provide a separate and independent cause of action to the
other Party to this Agreement, and that this Agreement may be used as evidence in a subsequent proceeding in which the other Party
alleges a breach of this Agreement. In the event of a breach of this Paragraph, the breaching party acknowledges that the non-breaching
party shall be entitled to injunctive or other equitable relief necessary to enforce this Paragraph. In the event that Employer
or Executive takes steps to seek relief from an alleged breach of this Paragraph, all of the remaining provisions of this Agreement
shall remain in full force and effect. Executive agrees to inform those persons who had knowledge of the fact and terms of this
Agreement on the date hereof that they are bound by the same terms of confidentiality in this Agreement that apply to Executive.
The provisions of this Paragraph shall not prohibit Executive from disclosing the fact and terms hereof to such accounting, legal,
or similar professional advisors as he/she may from time to time engage. This Paragraph shall not prohibit Employer from disclosing
the fact of and terms hereof to Employer’s accounting, legal, or similar professional advisors and to such employees of Employer
who, as part of their employment duties in terms of personnel functions at Employer are required to have this information; however,
all such employees shall be informed of the confidentiality of the fact of and terms of this Agreement, and they are bound by the
same terms of confidentiality as apply to Employer.

 

    	 

    	 

    

 

12.         Severability.
Should any part of this Agreement be rendered or declared invalid by a court of competent jurisdiction of the Commonwealth of Pennsylvania,
such invalidation of such part or portion of this Agreement should not invalidate the remaining portions thereof, and they shall
remain in full force and effect. However, if, within two (2) years from the date of this Agreement, any portion of the general
release language is ruled to be unenforceable for any reason, the parties will enter into good faith discussions to amend the general
release language to conform to all applicable laws regarding enforceability. If the parties are unable to mutually agree on an
appropriate amendment to the general release language, Executive shall return the consideration paid hereunder to Employer.

13.         No
Admission of Liability. Executive agrees that neither this Separation Agreement and Release nor the furnishing of the consideration
for this Release shall be deemed or construed at any time for any purpose as an admission by Employer of any liability or unlawful
conduct of any kind.

 

14.         Non-Disparagement.
 The parties mutually agree that they shall not make any statements to third parties with the intent or effect of disparaging
the other party.

 

15.         Right
to Review. Executive agrees that he/she has been given at least twenty-one (21) days after the receipt of this Separation
Agreement and Release to consider its terms and decide whether or not to sign it, but that he/she can freely and knowingly waive
the twenty-one (21) day period and execute the Agreement before the end of the twenty-one (21) day period, the effect of which
is to begin the running of the seven (7) day period described below.

 

16.         Right
to Revoke. Executive is aware that he/she may change her mind and freely revoke this Release, only insofar as it
applies to any claim he/she may have under the Age Discrimination in Employment Act (ADEA), at any time during the seven (7) days
after it is signed, in which case, the provisions of the Release as to the ADEA, only, will have no force or effect. Executive
understands and agrees that, upon his/her execution of this Agreement, the payment of the severance sum specified herein will be
held by Employer until the expiration of this seven (7) day revocation period, after which the payment will be tendered to Executive
if he/she has not exercised her revocation rights under this paragraph. Executive understands and agrees that any revocation under
this section must be in writing and delivered to counsel for Employer, at the address, which follows, postmarked within seven (7)
days of Executive’s signing of this Agreement to be effective: Jolie Kahn, Esq., 1800 John F Kennedy Blvd., Suite 1400, Philadelphia,
PA 19103. If the last day of the revocation period is a Saturday, Sunday, or legal holiday, then the revocation period shall not
expire until the next following day which is not a Saturday, Sunday, or legal holiday. The parties acknowledge and agree that
any revocation by Executive under this paragraph shall apply only to any claims Executive may have or assert under the ADEA, and
is not effective to revoke Executive’s waiver and release of any other claims pursuant to this Release.

 

17.         Right
to Consult with Counsel.  Executive has been and/or is hereby advised to review this Separation Agreement and Release with
Executive attorney, and expressly acknowledges that Executive has read and understands the Agreement and enters into the Agreement
of Executive own free will and as a competent adult.

 

18.         Binding
Effect. This Separation Agreement and Release shall be binding upon and inure to the benefit of all the parties hereto
and their respective shareholders, partners, associates, members, officers, directors, employees, administrators, agents, predecessors,
successors, parent companies, affiliates, subsidiaries, insurers, assigns, representatives, executors and heirs.

 

    	 

    	 

    

 

19.         Choice
of Law. This Separation Agreement and Release shall be interpreted, endorsed and governed in accordance with the laws of
the Commonwealth of Pennsylvania, without regard to its conflict of law rules.

 

20.         Modification.
The terms or conditions of this Separation Agreement and Release may not be modified, altered or changed except upon express written
consent of both parties wherein specific reference is made to this Agreement. Any waiver of the terms or covenants hereof must
be in a writing executed by the party waiving compliance. Failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect his/her or its right at a later time to enforce the same. No waiver by a party of a
breach of any term or covenant contained in this Agreement, whether by conduct or otherwise, in any one or more instances shall
be deemed to be or construed as a further or continuing waiver of such term or covenant.

 

21.         Competency.
The parties declare that each has fully participated in the negotiation of this Agreement, that each has carefully read this Agreement
and reviewed its terms, that each has been given an opportunity to consult with legal counsel to the extent any party so desires,
and that each agrees to it for the purpose of making a full and final compromise as to all matters referenced herein.

 

IN WITNESS WHEREOF,
the parties hereto have caused this Separation Agreement and Release to be executed on their behalf as of the day and year indicated
below.

 

	AXION POWER INTERNATIONAL, INC.
	 	 	 
	 	 	 
	By:  (name)	 	(Title)
	 	 	 
	Dated:  	 	 	 
	 	 	 	 

 

	 	 	 
	Executive’s name	 	Dated
	 	 	 
	 	 	 
	WITNESS	 	Dated

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