Document:

Exhibit 10.12

 

OPTION AGREEMENT

 

THE BOARD OF DIRECTORS
of Lapolla Industries, Inc. (the “Company”) authorized and approved the Equity Incentive Plan ("Plan"). The
Plan provides for the grant of Options to employees of the Company. Unless otherwise provided herein all defined terms shall have
the respective meanings ascribed to them under the Plan.

 

1.Grant of Option. Pursuant
to authority granted to it under the Plan, the Administrator responsible for administering the Plan hereby grants to RICHARD J.
KURTZ, a director of the Company (“Optionee”) and as of May 14, 2014 ("Grant Date"), the following stock
options: 400,000 stock options (“Options”). Each Option permits you to purchase one share of the Company’s common
stock, $.01 par value, at the Exercise Price ("Shares").

 

2.Character of Options. Pursuant
to the Plan, Options granted herein may be Incentive Stock Options or Non-Qualified Stock Options, or both. To the extent permitted
under the Plan and by law, such Options shall first be considered Incentive Stock Options.

 

3.Exercise Price. The exercise
price (“Exercise Price”) for each Non-Qualified Stock Option granted herein is 54¢ ($ 0.54) per Share and for
each Incentive Stock Option granted herein shall be 54¢ ($ 0.54) per Share [except that an Incentive Stock Option granted
to a Ten Percent Owner shall be 59¢ ($ 0.59) per Share].

 

4.Vesting and Exercisability.
The Options shall vest over a period of two (2) years at the rate of 200,000 options on May 14, 2015 and 200,000 options on May
14, 2016, and once vested, are immediately exercisable, subject to continued satisfactory services with the Company prior to and
upon exercise, in accordance with the terms and conditions of the Plan and this agreement.

 

5.Term of Options. The term
of each Option granted herein shall be for a term of up to five (5) years from Grant Date.

 

6.Payment of Exercise Price.
Options represented hereby may be exercised in whole or in part by delivering to the Company your payment of the Exercise Price
for the number of Options so exercised (i) in cash, by check or cash equivalent, (ii) by tender to the Company of shares
of Stock owned by the Participant having a Fair Market Value not less than the exercise price for the number of Options exercised;
(iii) by tender to the Company of a written consent to accept a reduction in the number of shares of Stock issuable upon exercise
(“Reduced Number of Shares”), which Reduced Number of Shares, when ascribed a value, shall have a value equal
to the Exercise Price for the number of Options exercised; (iv) by delivery of a properly executed notice of exercise together
with irrevocable instructions to a broker providing for the assignment to the Company of the proceeds of a sale or loan with respect
to some or all of the shares being acquired upon the exercise of the Option or portion thereof exercised (including, without limitation,
through an exercise complying with the provisions of Regulation T as promulgated from time to time by the Board of Governors
of the Federal Reserve System) (a "Cashless Exercise"), (v) by such other consideration as may be approved
by the Committee from time to time to the extent permitted by applicable law, or (vi) by any combination thereof. The Company
reserves, at any and all times, the right, in the Company's sole and absolute discretion, to establish, decline to approve or terminate
any program or procedures for the exercise of Options by means of a Cashless Exercise.

 

7.Limits on Transfer of Options.
The Option granted herein shall not be transferable by you otherwise than by will or by the laws of descent and distribution, except
for gifts to family members subject to any specific limitation concerning such gift by the Administrator in its discretion; provided,
however, that you may designate a beneficiary or beneficiaries to exercise your rights and receive any Shares purchased with respect
to any Option upon your death. Each Option shall be exercisable during your lifetime only by you or, if permissible under applicable
law, by your legal representative. No Option herein granted or Shares underlying any Option shall be pledged, alienated, attached
or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable
against the Company. Notwithstanding the foregoing, to the extent permitted by the Administrator, in its discretion, an Option
shall be assignable or transferable subject to the applicable limitations, if any, described in the General Instructions to Form S-8
Registration Statement under the Securities Act of 1933, as amended.

 

1

     

     

    
 

8.Termination of Services. If
your service is terminated with the Company, the Option and any unexercised portion shall be subject to the provisions below:

 

(a)Upon the termination of your services
with the Company, to the extent not theretofore exercised, your Option shall continue to be valid; provided, however, that: (i)
If the Participant’s service is terminated by dismissal by the Company other than for cause (as defined below), disability
(as described in Section 22(e) of the Code) or death while in the employ of the Company and at a time when such Participant was
entitled to exercise an Option as herein provided, any unvested Options shall automatically vest and become exercisable as of the
date of termination, and the Participant or their legal representative of such Participant, as the case may be, or such Person
who acquired such Option by bequest or inheritance or by reason of the death of the Participant, may, not later than fifteen (15)
months from the date of death, exercise such Option, to the extent not theretofore exercised, in respect of any or all of such
number of Shares specified by the Administrator in such Option; and (ii) If the services of any Participant to whom such Option
shall have been granted shall terminate by reason of the Participant's retirement (at such age upon such conditions as shall be
specified by the Board of Directors), and while such Participant is entitled to exercise such Option as herein provided, any unvested
Options shall automatically vest and become exercisable as of the date of retirement, such Participant shall have the right to
exercise such Option so granted, to the extent not theretofore exercised, in respect of any or all of such number of Shares as
specified by the Administrator in such Option, at any time up to one (1) year from the date of termination of the Optionee's services
by reason of retirement.

 

(b)If you voluntarily terminate your
services, Participant shall have the right to exercise such Option that has vested, to the extent not theretofore exercised, at
any time up to ninety (90) days from the date of termination of the Optionee's services, or if you are discharged for cause, any
Options granted hereunder shall forthwith terminate with respect to any unexercised portion thereof.

 

(c)If any Options granted hereunder
shall be exercised by your legal representative if you should die or become disabled, or by any person who acquired any Options
granted hereunder by bequest or inheritance or by reason of death of any such person written notice of such exercise shall be accompanied
by a certified copy of letters testamentary or equivalent proof of the right of such legal representative or other person to exercise
such Options.

 

(d)For all purposes of the Plan, the
term "for cause" shall mean "cause" as defined in the Plan.

 

9.Restriction; Securities Exchange
Listing. All certificates for shares delivered upon the exercise of Options granted herein shall be subject to such stop transfer
orders and other restrictions as the Administrator may deem advisable under the Plan or the rules, regulations and other requirements
of the Securities and Exchange Commission and any applicable federal or state securities laws, and the Administrator may cause
a legend or legends to be placed on such certificates to make appropriate reference to such restrictions. If the Shares or other
securities are traded on a national securities exchange, the Company shall not be required to deliver any Shares covered by an
Option unless and until such Shares have been admitted for trading on such securities exchange.

 

10.Adjustments. If there is
any change in the capitalization of the Company affecting in any manner the number or kind of outstanding shares of Common Stock
of the Company, whether by stock dividend, stock split, reclassification or recapitalization of such stock, or because the Company
has merged or consolidated with one or more other corporations (and provided the Option does not thereby terminate pursuant to
Section 5 hereof), then the number and kind of shares then subject to the Option and the price to be paid therefor shall be appropriately
adjusted by the Board of Directors; provided, however, that in no event shall any such adjustment result in the Company's being
required to sell or issue any fractional shares. Any such adjustment shall be made without change in the aggregate purchase price
applicable to the unexercised portion of the option, but with an appropriate adjustment to the price of each Share or other unit
of security covered by this Option.

 

2

     

     

    

 

 

11.Change in Control. In the
event of a Change in Control (as defined in the Plan), the surviving, continuing, successor, or purchasing entity or parent thereof,
as the case may be (the "Acquiror"), may, without the consent of any Participant, either assume the Company's
rights and obligations under outstanding Options or substitute for outstanding Options substantially equivalent options for the
Acquiror's stock. In the event the Acquiror elects not to assume or substitute for outstanding Options in connection with a Change
in Control, the Committee shall provide that any unexercised and/or unvested portions of outstanding Options shall be immediately
exercisable and vested in full as of the date thirty (30) days prior to the date of the Change in Control. The exercise and/or
vesting of any Option that was permissible solely by reason of this Section 11 shall be conditioned upon the consummation of the
Change in Control. Any Options which are not assumed by the Acquiror in connection with the Change in Control nor exercised as
of the time of consummation of the Change in Control shall terminate and cease to be outstanding effective as of the time of consummation
of the Change in Control.

 

12.Amendment to Options Herein Granted.
The Options granted herein may not be amended without your consent.

 

13.Withholding Taxes. As provided
in the Plan, the Company may withhold from sums due or to become due to Optionee from the Company an amount necessary to satisfy
its obligation to withhold taxes incurred by reason of the disposition of the Shares acquired by exercise of the Options in a disqualifying
disposition (within the meaning of Section 421(b) of the Code), or may require you to reimburse the Company in such amount.

 

LAPOLLA INDUSTRIES, INC.

 

 

 

/s/ Michael T. Adams,
Secretary

Corporate Secretary

 

OPTIONEE

 

 

 

/s/ Richard J. Kurtz

Richard J. Kurtz

 

 

 

 

3EXHIBIT 4.1

 

Securities
Purchase Agreement

 

This
Securities Purchase Agreement (this “Agreement”),
dated as of September 26, 2014, is entered into by and between WindStream
Technologies, Inc., a Wyoming corporation (“Company”), and
Typenex Co-Investment,
LLC, a Utah limited liability company, its successors and/or assigns (“Investor”).

 

A.
Company and Investor are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by the rules and regulations promulgated by the United States Securities and Exchange Commission (the “SEC”)
under the Securities Act of 1933, as amended (the “1933 Act”).

 

B.
Investor desires to purchase and Company desires to issue and sell, upon the terms and conditions set forth in this Agreement
(i) a Secured Convertible Promissory Note, in the form attached hereto as Exhibit A, in the original principal amount of
$550,000.00 (the “Note”), convertible into shares of common stock, $0.001 par value per share, of Company (the
“Common Stock”), upon the terms and subject to the limitations and conditions set forth in such Note, and (ii)
three (3) Warrants to Purchase Shares of Common Stock, each in the form attached hereto as Exhibit B (each, a “Warrant”,
and collectively, the “Warrants”).

 

C.
This Agreement, the Note, the Warrants, the Security Agreement (as defined below), the Investor Notes (as defined below), and
all other certificates, documents, agreements, resolutions and instruments delivered to any party under or in connection with
this Agreement, as the same may be amended from time to time, are collectively referred to herein as the “Transaction
Documents”.

 

D.
For purposes of this Agreement: “Conversion Shares” means all shares of Common Stock issuable upon conversion
of all or any portion of the Note; “Warrant Shares” means all shares of Common Stock issuable upon the exercise
of or pursuant to the Warrants; and “Securities” means the Note, the Conversion Shares, the Warrants and the
Warrant Shares.

 

NOW,
THEREFORE, Company and Investor hereby agree as follows:

 

1.
Purchase and Sale of Securities.

 

1.1.
Purchase of Securities. Company shall issue and sell to Investor and Investor agrees to purchase from Company the Note
and the Warrants. In consideration thereof, Investor shall pay (i) the amount designated as the initial cash purchase price on
Investor’s signature page to this Agreement (the “Initial Cash Purchase Price”), and (ii) issue to Company
the Investor Notes (the sum of the initial principal amount of the Investor Notes, together with the Initial Cash Purchase Price,
the “Purchase Price”). The Purchase Price and the OID (as defined herein) are allocated to the Tranches (as
defined in the Note) of the Note and to the Warrants as set forth in the table attached hereto as Exhibit C. For the avoidance
of doubt, the Initial Cash Purchase Price constitutes payment in full for the Initial Tranche (as defined in the Note) and Warrant
#1 to Purchase Shares of Common Stock.

 

1.2.
Form of Payment. On the Closing Date, (i) Investor shall pay the Purchase Price to Company by delivering the following
at the Closing: (A) the Initial Cash Purchase Price, which shall be delivered by wire transfer of immediately available funds
to Company, in accordance with Company’s written wiring instructions; (B) Investor Note #1 in the principal amount of $125,000.00
duly executed and substantially in the form attached hereto as Exhibit D (“Investor Note #1”); and (C)
Investor Note #2 in the principal amount of $125,000.00 duly executed and substantially in the form attached hereto as Exhibit
D (“Investor Note #2”, and together with Investor Note #1, the “Investor Notes”); and
(ii) Company shall deliver the duly executed Note and Warrants on behalf of Company, to Investor, against delivery of such Purchase
Price.

 

    	 

    	 

    

 

1.3.
Closing Date. Subject to the satisfaction (or written waiver) of the conditions set forth in Section 5 and Section 6 below,
the date and time of the issuance and sale of the Securities pursuant to this Agreement (the “Closing Date”)
shall be 5:00 p.m., Eastern Time on or about September 26, 2014, or such other mutually agreed upon time. The closing of the transactions
contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at the offices of Investor unless
otherwise agreed upon by the parties.

 

1.4.
Collateral for the Note. The Note shall be secured by the collateral set forth in that certain Security Agreement attached
hereto as Exhibit E listing all of the Investor Notes as security for Company’s obligations under the Transaction
Documents (the “Security Agreement”).

 

1.5.
Collateral for Investor Notes. Initially, none of the Investor Notes will be secured, but all or any of the Investor Notes
may become secured subsequent to the Closing by such collateral and at such time as determined by Investor in its sole discretion.
In the event Investor desires to secure any of the Investor Notes, Company shall timely execute any and all amendments and documents
and take such other measures requested by Investor that are necessary or advisable in order to properly secure the applicable
Investor Notes.

 

1.6.
Original Issue Discount; Transaction Expenses. The Note carries an original issue discount of $50,000.00 (the “OID”).
In addition, Company agrees to pay $5,000.00 to Investor to cover Investor’s legal fees, accounting costs, due diligence,
monitoring and other transaction costs incurred in connection with the purchase and sale of the Securities, all of which amount
has been previously paid. The Purchase Price, therefore, shall be $500,000.00, computed as follows: $550,000.00 original principal
balance, less the OID. The Initial Cash Purchase Price shall be the Purchase Price less the sum of the initial principal amounts
of the Investor Notes. The portion of the OID allocated to the Initial Cash Purchase Price is set forth on Exhibit C.

 

2.
Investor’s Representations and Warranties. Investor represents and warrants to Company that: (i) this Agreement has
been duly and validly authorized; (ii) this Agreement constitutes a valid and binding agreement of Investor enforceable in accordance
with its terms; (iii) Investor is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D
of the 1933 Act, and (iv) this Agreement and the Investor Notes have been duly executed and delivered on behalf of Investor.

 

3.
Representations and Warranties of Company. Company represents and warrants to Investor that: (i) Company is a corporation
duly organized, validly existing and in good standing under the laws of its state of incorporation and has the requisite corporate
power to own its properties and to carry on its business as now being conducted; (ii) Company is duly qualified as a foreign corporation
to do business and is in good standing in each jurisdiction where the nature of the business conducted or property owned by it
makes such qualification necessary; (iii) Company has registered its Common Stock under Section 12(g) of the Securities Exchange
Act of 1934, as amended (the “1934 Act”), and is obligated to file reports pursuant to Section 13 or Section
15(d) of the 1934 Act; (iv) each of the Transaction Documents and the transactions contemplated hereby and thereby, have been
duly and validly authorized by Company; (v) this Agreement, the Note, the Security Agreement, the Warrants, and the other Transaction
Documents have been duly executed and delivered by Company and constitute the valid and binding obligations of Company enforceable
in accordance with their terms, subject as to enforceability only to general principles of equity and to bankruptcy, insolvency,
moratorium, and other similar laws affecting the enforcement of creditors’ rights generally; (vi) the execution and delivery
of the Transaction Documents by Company, the issuance of Securities in accordance with the terms hereof, and the consummation
by Company of the other transactions contemplated by the Transaction Documents do not and will not conflict with or result in
a breach by Company of any of the terms or provisions of, or constitute a default under (a) Company’s formation documents
or bylaws, each as currently in effect, (b) any indenture, mortgage, deed of trust, or other material agreement or instrument
to which Company is a party or by which it or any of its properties or assets are bound, including any listing agreement for the
Common Stock, or (c) to Company’s knowledge, any existing applicable law, rule, or regulation or any applicable decree,
judgment, or order of any court, United States federal or state regulatory body, administrative agency, or other governmental
body having jurisdiction over Company or any of Company’s properties or assets; (vii) no further authorization, approval
or consent of any court, governmental body, regulatory agency, self-regulatory organization, or stock exchange or market or the
stockholders or any lender of Company is required to be obtained by Company for the issuance of the Securities to Investor; (viii)
none of Company’s filings with the SEC contained, at the time they were filed, any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to make the statements made therein, in light of
the circumstances under which they were made, not misleading; (ix) Company has filed all reports, schedules, forms, statements
and other documents required to be filed by Company with the SEC under the 1934 Act on a timely basis or has received a valid
extension of such time of filing and has filed any such report, schedule, form, statement or other document prior to the expiration
of any such extension; (x) Company is not, nor has it ever been, a “Shell Company,” as such type of “issuer”
is described in Rule 144(i)(1) under the 1933 Act; (xi) Company has taken no action which would give rise to any claim by any
person or entity for a brokerage commission, placement agent or finder’s fees or similar payments by Investor relating to
the Note or the transactions contemplated hereby; (xii) except for such fees arising as a result of any agreement or arrangement
entered into by Investor without the knowledge of Company (an “Investor’s Fee”), Investor shall have
no obligation with respect to such fees or with respect to any claims made by or on behalf of other persons for fees of a type
contemplated in this subsection that may be due in connection with the transactions contemplated hereby and Company shall indemnify
and hold harmless each of Investor, Investor’s employees, officers, directors, stockholders, managers, agents, and partners,
and their respective affiliates, from and against all claims, losses, damages, costs (including the costs of preparation and attorneys’
fees) and expenses suffered in respect of any such claimed or existing fees (other than an Investor’s Fee, if any), and
(xiii) when issued, each of the Securities (including, without limitation, the Conversion Shares and the Warrant Shares), will
be validly issued, fully paid for and non-assessable, free and clear of all liens, claims, charges and encumbrances.

 

    	 

    	 

    

 

4.
Company Covenants. Until all of Company’s obligations hereunder are paid and performed in full, or within the timeframes
otherwise specifically set forth below, Company shall comply with the following covenants: (i) from the date hereof until the
date that is six (6) months after all the Conversion Shares and the Warrant Shares either have been sold by Investor, or may permanently
be sold by Investor without any restrictions pursuant to Rule 144, Company shall timely make all filings required to be made by
it under the 1933 Act, the 1934 Act, Rule 144 or any United States securities laws and regulations thereof applicable to Company
or by the rules and regulations of its principal trading market, and such filings shall conform to the requirements of applicable
laws, regulations and government agencies, and, unless such filings are publicly available on the SEC’s EDGAR system (via
the SEC’s web site at no additional charge), Company shall provide a copy thereof to Investor promptly after such filings;
(ii) so long as Investor beneficially owns any of the Securities and for at least twenty (20) Trading Days thereafter, Company
shall file all reports required to be filed with the SEC pursuant to Sections 13 or 15(d) of the 1934 Act, and shall take all
reasonable action under its control to ensure that adequate current public information with respect to Company, as required in
accordance with Rule 144, is publicly available, and shall not terminate its status as an issuer required to file reports under
the 1934 Act even if the 1934 Act or the rules and regulations thereunder would permit such termination; (iii) the Common Stock
shall be listed or quoted for trading on any of (a) the NYSE Amex, (b) the New York Stock Exchange, (c) the Nasdaq Global Market,
(d) the Nasdaq Capital Market, (e) the OTC Bulletin Board, (f) the OTCQX, or (g) the OTCQB; (iv) when issued, each of the Securities
(including, without limitation, the Conversion Shares and the Warrant Shares), will be validly issued, fully paid for and non-assessable,
free and clear of all liens, claims, charges and encumbrances, (v) Company shall use the net proceeds received hereunder for working
capital and general corporate purposes only; provided, however, Company will not use such proceeds to pay fees payable
(A) to any broker or finder relating to the offer and sale of the Securities unless such broker, finder, or other party is a registered
investment adviser or registered broker-dealer and such fees are paid in full compliance with all applicable laws and regulations,
or (B) to any other party relating to any financing transaction effected prior to the date hereof; and (vi) from and after the
date hereof and until all of Company’s obligations hereunder and the Note are paid and performed in full, Company shall
not transfer, assign, sell, pledge, hypothecate or otherwise alienate or encumber the Investor Notes in any way without the prior
written consent of Investor.

 

    	 

    	 

    

 

5.
Conditions to Company’s Obligation to Sell. The obligation of Company hereunder to issue and sell the Securities
to Investor at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions:

 

5.1.
Investor shall have executed this Agreement and the Investor Notes and delivered the same to Company.

 

5.2.
Investor shall have delivered the Initial Cash Purchase Price to Company in accordance with Section 1.2 above.

 

6.
Conditions to Investor’s Obligation to Purchase. The obligation of Investor hereunder to purchase the Securities
at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that
these conditions are for Investor’s sole benefit and may be waived by Investor at any time in its sole discretion:

 

6.1.
Company shall have executed this Agreement and delivered the same to Investor.

 

6.2.
Company shall have delivered to Investor the duly executed Note and Warrants in accordance with Section 1.2 above.

 

6.3.
The Irrevocable Letter of Instructions to Transfer Agent substantially in the form attached hereto as Exhibit F shall have
been delivered to and acknowledged in writing by Company’s transfer agent (the “Transfer Agent”).

 

6.4.
Company shall have delivered to Investor a fully executed Secretary’s Certificate substantially in the form attached hereto
as Exhibit G evidencing Company’s approval of the Transaction Documents.

 

6.5.
Company shall have delivered to Investor a fully executed Share Issuance Resolution substantially in the form attached hereto
as Exhibit H to be delivered to the Transfer Agent.

 

6.6.
Company shall have delivered to Investor fully executed copies of the Security Agreement and all other Transaction Documents required
to be executed by Company herein or therein.

 

7.
Reservation of Shares. At all times during which the Note is convertible or the Warrants are exercisable, Company will
reserve from its authorized and unissued Common Stock to provide for the issuance of Common Stock upon the full conversion of
the Note and full exercise of the Warrants. Company will at all times reserve at least (i) three (3) times the higher of (1) the
Outstanding Balance (as defined in and determined pursuant to the Note) divided by the Lender Conversion Price (as defined in
and determined pursuant to the Note), and (2) the Outstanding Balance divided by the Market Price (as defined in and determined
pursuant to the Note), plus (ii) three (3) times the number of Warrant Shares (as determined pursuant to the Warrants)
deliverable upon full exercise of the Warrants (the “Share Reserve”), but in any event not less than 2,000,000
shares of Common Stock shall be reserved at all times for such purpose (the “Transfer Agent Reserve”). Company
further agrees that it will cause the Transfer Agent to immediately add shares of Common Stock to the Transfer Agent Reserve in
increments of 500,000 shares as and when requested by Investor in writing from time to time, provided that such incremental increases
do not cause the Transfer Agent Reserve to exceed the Share Reserve. In furtherance thereof, from and after the date hereof and
until such time that the Note has been paid in full and the Warrants exercised in full, Company shall require the Transfer Agent
to reserve for the purpose of issuance of Conversion Shares under the Note and Warrant Shares under the Warrants, a number of
shares of Common Stock equal to the Transfer Agent Reserve. Company shall further require the Transfer Agent to hold such shares
of Common Stock exclusively for the benefit of Investor and to issue such shares to Investor promptly upon Investor’s delivery
of a conversion notice under the Note or a Notice of Exercise under any Warrant. Finally, Company shall require the Transfer Agent
to issue shares of Common Stock pursuant to the Note and the Warrants to Investor out of its authorized and unissued shares, and
not the Transfer Agent Reserve, to the extent shares of Common Stock have been authorized, but not issued, and are not included
in the Transfer Agent Reserve. The Transfer Agent shall only issue shares out of the Transfer Agent Reserve to the extent there
are no other authorized shares available for issuance and then only with Investor’s written consent.

 

    	 

    	 

    

 

8.
Investor’s Consent Right to New Issuances. If Company makes Variable Security Issuances (as defined below) to six
(6) separate individuals or entities (other than Investor), then from and after the date of the sixth Variable Security Issuance
and until all of Company’s obligations under the Note are paid and performed in full and the Warrant has been exercised
in full (or otherwise expired), Company shall not enter into any additional Variable Security Issuances without first obtaining
Investor’s written consent. For purposes hereof, the term “Variable Security Issuance” means any transaction
pursuant to Section 3(a)(9) or Section 3(a)(10) of the 1933 Act, equity line of credit or financing arrangement or other transaction
that involves issuing Company securities that are convertible into Common Stock (including without limitation selling convertible
debt, warrants or convertible preferred stock) with a conversion price that varies with the market price of the Common Stock.

 

9.
Miscellaneous. The provisions set forth in this Section 9 shall apply to this Agreement, as well as all other Transaction
Documents as if these terms were fully set forth therein.

 

9.1.
Original Signature Pages. Each party agrees to deliver its original signature pages to the Transaction Documents to the
other party within five (5) Trading Days of the date hereof. Notwithstanding the foregoing, the Transaction Documents shall be
fully effective upon exchange of electronic signature pages by the parties and payment of the Initial Cash Purchase Price by Investor.
For the avoidance of doubt, the failure by either party to deliver its original signature pages to the other party shall not affect
in any way the validity or effectiveness of any of the Transaction Documents, provided that such failure to deliver original signatures
shall be a breach of the party’s obligations hereunder.

 

9.2.
Cross Default. Any Event of Default (as defined in the Note) by Company under the Note shall be deemed a default under
this Agreement, and any default by Company under this Agreement will be deemed an Event of Default under the Note.

 

9.3.
Governing Law; Venue. This Agreement shall be governed by and interpreted in accordance with the laws of the State of Utah
for contracts to be wholly performed in such state and without giving effect to the principles thereof regarding the conflict
of laws. Each party consents to and expressly agrees that venue for Arbitration (as defined in Exhibit I) of any dispute
arising out of or relating to any Transaction Document or the relationship of the parties or their affiliates shall be in Salt
Lake County or Utah County, Utah; provided, however, that notwithstanding anything herein to the contrary, enforcement
of Investor’s rights under the Security Agreement will occur in accordance with the Uniform Commercial Code of the applicable
state(s) under the Security Agreement and enforcement of Company’s rights over the Collateral will occur in accordance with
the laws of the state in which the Collateral is located). Without modifying the parties obligations to resolve disputes hereunder
pursuant to the Arbitration Provisions (as defined below), for any litigation arising in connection with any of the Transaction
Documents, each party hereto hereby (a) consents to and expressly submits to the exclusive personal jurisdiction of any state
or federal court sitting in Salt Lake County, Utah, (b) expressly submits to the venue of any such court for the purposes hereof,
and (c) waives any claim of improper venue and any claim or objection that such courts are an inconvenient forum or any other
claim or objection to the bringing of any such proceeding in such jurisdictions or to any claim that such venue of the suit, action
or proceeding is improper.

 

    	 

    	 

    

 

9.4.
Arbitration of Claims. The parties shall submit all Claims (as defined in Exhibit I) arising under this Agreement
or any other Transaction Document or other agreements between the parties and their affiliates to binding arbitration pursuant
to the arbitration provisions set forth in Exhibit I attached hereto (the “Arbitration Provisions”).
The parties hereby acknowledge and agree that the Arbitration Provisions are unconditionally binding on the parties hereto and
are severable from all other provisions of this Agreement. Any capitalized term not defined in the Arbitration Provisions shall
have the meaning set forth in this Agreement. By executing this Agreement, Company represents, warrants and covenants that Company
has reviewed the Arbitration Provisions carefully, consulted with legal counsel about such provisions (or waived its right to
do so), understands that the Arbitration Provisions are intended to allow for the expeditious and efficient resolution of any
dispute hereunder, agrees to the terms and limitations set forth in the Arbitration Provisions, and that Company will not take
a position contrary to the foregoing representations. Company acknowledges and agrees that Investor may rely upon the foregoing
representations and covenants of Company regarding the Arbitration Provisions.

 

9.5.
Calculation Disputes. Notwithstanding the Arbitration Provisions, in the case of a dispute as to any arithmetic calculation
under the Transaction Documents, including without limitation, calculating the Outstanding Balance, Warrant Shares, Exercise Shares
(as defined in the Warrants), Delivery Shares (as defined in the Warrants), Lender Conversion Price, Lender Conversion Shares
(as defined in the Note) to be delivered, Installment Conversion Price (as defined in the Note), Installment Conversion Shares
(as defined in the Note) to be delivered, Market Price, Conversion Shares, or the VWAP (as defined in the Note) (collectively,
“Calculations”), Company or Investor (as the case may be) shall submit the disputed determinations or arithmetic
calculations (as the case may be) via facsimile or email with confirmation of receipt (a) within two (2) Trading Days after receipt
of the applicable notice giving rise to such dispute to Company or Investor (as the case may be) or (b) if no notice gave rise
to such dispute, at any time after Investor learned of the circumstances giving rise to such dispute. If Investor and Company
are unable to agree upon such determination or calculation within two (2) Trading Days of such disputed determination or arithmetic
calculation (as the case may be) being submitted to Company or Investor (as the case may be), then Investor shall, within two
(2) Trading Days, submit via email or facsimile the disputed Calculation to Unkar Systems Inc. (“Unkar Systems”).
Company shall cause Unkar Systems to perform the determinations or calculations (as the case may be) and notify Company and
Investor of the results no later than ten (10) Trading Days from the time it receives such disputed determinations or calculations
(as the case may be). Unkar Systems’ determination of the disputed Calculation shall be binding upon all parties absent
demonstrable error. Unkar Systems’ fee for performing such Calculation shall be paid by the incorrect party, or if both
parties are incorrect, by the party whose Calculation is furthest from the correct Calculation as determined by Unkar Systems.
In the event Company is the losing party, no extension of the Delivery Date shall be granted and Company shall incur all effects
for failing to deliver the applicable shares in a timely manner as set forth in the Transaction Documents. Notwithstanding the
foregoing, Investor may, in its sole discretion, designate an independent, reputable investment bank or accounting firm other
than Unkar Systems to resolve any such dispute and in such event, all references to “Unkar Systems” herein will be
replaced with references to such independent, reputable investment bank or accounting firm so designated by Investor.

 

9.6.
Counterparts. Each Transaction Document may be executed in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one instrument. The parties hereto confirm that any electronic copy of another
party’s executed counterpart of a Transaction Document (or such party’s signature page thereof) will be deemed to
be an executed original thereof.

 

9.7.
Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the
interpretation of, this Agreement.

 

    	 

    	 

    

 

9.8.
Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute
or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform to such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision hereof.

 

9.9.
Entire Agreement; Amendments. This Agreement and the instruments and exhibits referenced herein contain the entire understanding
of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein,
neither Company nor Investor makes any representation, warranty, covenant or undertaking with respect to such matters. No provision
of this Agreement may be waived or amended other than by an instrument in writing signed by the parties hereto.

 

9.10.
Notices. Any notice required or permitted hereunder shall be given in writing (unless otherwise specified herein) and shall
be deemed effectively given on the earliest of: (a) the date delivered, if delivered by personal delivery as against written receipt
therefor or by email to an executive officer, or by facsimile (with successful transmission confirmation), (b) the earlier of
the date delivered or the third Trading Day after deposit, postage prepaid, in the United States Postal Service by certified mail,
or (c) the earlier of the date delivered or the third Trading Day after mailing by express courier, with delivery costs and fees
prepaid, in each case, addressed to each of the other parties thereunto entitled at the following addresses (or at such other
addresses as such party may designate by five (5) calendar days’ advance written notice similarly given to each of the other
parties hereto):

 

If
to Company:

 

WindStream
Technologies, Inc.

Attn:
Daniel Bates

819
Buckeye Street

North
Vernon, Indiana 47265

 

If
to Investor:

 

Typenex
Co-Investment, LLC

Attn:
John Fife

303
East Wacker Drive, Suite 1200

Chicago,
Illinois 60601

 

With
a copy to (which copy shall not constitute notice):

 

Hansen
Black Anderson Ashcraft PLLC

Attn:
Jonathan K. Hansen

3051
West Maple Loop, Suite 325

Lehi,
Utah 84043

 

9.11.
Successors and Assigns. This Agreement or any of the severable rights and obligations inuring to the benefit of or to be
performed by Investor hereunder may be assigned by Investor to a third party, including its financing sources, in whole or in
part, without the need to obtain Company’s consent thereto. Company may not assign its rights or obligations under this
Agreement or delegate its duties hereunder without the prior written consent of Investor.

 

9.12.
Survival. The representations and warranties of Company and the agreements and covenants set forth in this Agreement shall
survive the Closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of Investor. Company agrees
to indemnify and hold harmless Investor and all its officers, directors, employees, attorneys, and agents for loss or damage arising
as a result of or related to any breach or alleged breach by Company of any of its representations, warranties and covenants set
forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they
are incurred.

 

    	 

    	 

    

 

9.13.
Publicity. Company and Investor shall have the right to review a reasonable period of time before issuance of any press
releases by the other party with respect to the transactions contemplated hereby.

 

9.14.
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things,
and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions
contemplated hereby.

 

9.15.
Investor’s Rights and Remedies Cumulative; Liquidated Damages. All rights, remedies, and powers conferred in this
Agreement and the Transaction Documents are cumulative and not exclusive of any other rights or remedies, and shall be in addition
to every other right, power, and remedy that Investor may have, whether specifically granted in this Agreement or any other Transaction
Document, or existing at law, in equity, or by statute, and any and all such rights and remedies may be exercised from time to
time and as often and in such order as Investor may deem expedient. The parties acknowledge and agree that upon Company’s
failure to comply with the provisions of the Transaction Documents, Investor’s damages would be uncertain and difficult
(if not impossible) to accurately estimate because of the parties’ inability to predict future interest rates and future
share prices, Investor’s increased risk, and the uncertainty of the availability of a suitable substitute investment opportunity
for Investor, among other reasons. Accordingly, any fees, charges, and default interest due under the Note, the Warrants, and
the other Transaction Documents are intended by the parties to be, and shall be deemed, liquidated damages (under Company’s
and Investor’s expectations that any such liquidated damages will tack back to the Closing Date for purposes of determining
the holding period under Rule 144). The parties agree that such liquidated damages are a reasonable estimate of Investor’s
actual damages and not a penalty, and shall not be deemed in any way to limit any other right or remedy Investor may have hereunder,
at law or in equity. The parties acknowledge and agree that under the circumstances existing at the time this Agreement is entered
into, such liquidated damages are fair and reasonable and are not penalties. All fees, charges, and default interest provided
for in the Transaction Documents are agreed to by the parties to be based upon the obligations and the risks assumed by the parties
as of the Closing Date and are consistent with investments of this type. The liquidated damages provisions of the Transaction
Documents shall not limit or preclude a party from pursuing any other remedy available at law or in equity; provided, however,
that the liquidated damages provided for in the Transaction Documents are intended to be in lieu of actual damages.

 

9.16.
Ownership Limitation. Notwithstanding anything to the contrary contained in this Agreement or the other Transaction Documents,
if at any time Investor shall or would be issued shares of Common Stock under any of the Transaction Documents, but such issuance
would cause Investor (together with its affiliates) to beneficially own a number of shares exceeding the Maximum Percentage (as
defined in the Note), then Company must not issue to Investor the shares that would cause Investor to exceed the Maximum Percentage.
The shares of Common Stock issuable to Investor that would cause the Maximum Percentage to be exceeded are referred to herein
as the “Ownership Limitation Shares”. Company will reserve the Ownership Limitation Shares for the exclusive
benefit of Investor. From time to time, Investor may notify Company in writing of the number of the Ownership Limitation Shares
that may be issued to Investor without causing Investor to exceed the Maximum Percentage. Upon receipt of such notice, Company
shall be unconditionally obligated to immediately issue such designated shares to Investor, with a corresponding reduction in
the number of the Ownership Limitation Shares. For purposes of this Section, beneficial ownership of Common Stock will be determined
under Section 13(d) of the 1934 Act.

 

    	 

    	 

    

 

9.17.
Attorneys’ Fees and Cost of Collection. In the event of any arbitration or action at law or in equity to enforce
or interpret the terms of this Agreement or any of the other Transaction Documents, the parties agree that the party who is awarded
the most money shall be deemed the prevailing party for all purposes and shall therefore be entitled to an additional award of
the full amount of the attorneys’ fees, deposition costs, and expenses paid by such prevailing party in connection with
arbitration or litigation without reduction or apportionment based upon the individual claims or defenses giving rise to the fees
and expenses. Nothing herein shall restrict or impair an arbitrator’s or a court’s power to award fees and expenses
for frivolous or bad faith pleading. If (a) the Note or any Warrant is placed in the hands of an attorney for collection or enforcement
prior to commencing arbitration or legal proceedings, or is collected or enforced through any arbitration or legal proceeding,
or Investor otherwise takes action to collect amounts due under the Note or to enforce the provisions of the Note or any Warrant;
or (b) there occurs any bankruptcy, reorganization, receivership of Company or other proceedings affecting Company’s creditors’
rights and involving a claim under the Note or any Warrant; then Company shall pay the costs incurred by Investor for such collection,
enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without
limitation, attorneys’ fees, expenses, deposition costs, and disbursements.

 

9.18.
Waiver. No waiver of any provision of this Agreement shall be effective unless it is in the form of a writing signed by
the party granting the waiver. No waiver of any provision or consent to any prohibited action shall constitute a waiver of any
other provision or consent to any other prohibited action, whether or not similar. No waiver or consent shall constitute a continuing
waiver or consent or commit a party to provide a waiver or consent in the future except to the extent specifically set forth in
writing.

 

9.19.
Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES ANY AND ALL RIGHTS SUCH PARTY MAY HAVE TO DEMAND
THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE RELATIONSHIPS OF THE
PARTIES HERETO BE TRIED BY JURY. THIS WAIVER EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY ARISING UNDER COMMON LAW
OR ANY APPLICABLE STATUTE, LAW, RULE OR REGULATION. FURTHER, EACH PARTY HERETO ACKNOWLEDGES THAT SUCH PARTY IS KNOWINGLY AND VOLUNTARILY
WAIVING SUCH PARTY’S RIGHT TO DEMAND TRIAL BY JURY.

 

9.20.
Time of the Essence. Time is expressly made of the essence with respect to each and every provision of this Agreement and
the other Transaction Documents.

 

[Remainder
of page intentionally left blank; signature page follows]

 

    	 

    	 

    

 

IN
WITNESS WHEREOF, the undersigned Investor and Company have caused this Agreement to be duly executed as of the date first above
written.

 

SUBSCRIPTION
AMOUNT:

 

	Principal Amount of Note:	 	$	550,000.00	 
	 	 	 	 	 
	Initial Cash Purchase Price:	 	$	250,000.00	 

 

	 	INVESTOR:
	 	 	 
	 	Typenex
    Co-Investment,
    LLC
	 	 	 
	 	By:	Red
    Cliffs Investments, Inc., its Manager
	 	 	 
	 	 	By:	 
	 	 	 	John
    M. Fife, President

 

	 	COMPANY:
	 	 	 
	 	WindStream
    Technologies, Inc.
	 	 
	 	Bv:	/s/
    Dan Bates
	 	Printed Name:
    Dan Bates
	 	Title:	President

 

ATTACHED
EXHIBITS:

 

	Exhibit
    A	Note
	Exhibit
    B	Form
    of Warrants
	Exhibit
    C	Allocation
    of Purchase Price
	Exhibit
    D	Form
    of Investor Note
	Exhibit
    E	Security
    Agreement
	Exhibit
    F	Irrevocable
    Transfer Agent Instructions
	Exhibit
    G	Secretary’s
    Certificate
	Exhibit
    H	Share
    Issuance Resolution
	Exhibit
    I	Arbitration
    Provisions

 

    	 

    	 

    

 

EXHIBIT
I

 

ARBITRATION
PROVISIONS

 

1.
Dispute Resolution. For purposes of this Exhibit
I, the term “Claims” means any disputes, claims, demands,
causes of action, liabilities, damages, losses, or controversies whatsoever arising from related to or connected with the transactions
contemplated in the Transaction Documents and any communications between the parties related thereto, including without limitation
any claims of mutual mistake, mistake, fraud, misrepresentation, failure of formation, failure of consideration, promissory estoppel,
unconscionability, failure of condition precedent, rescission, and any statutory claims, tort claims, contract claims, or claims
to void, invalidate or terminate the Agreement or any of the other Transaction Documents. The term “Claims” specifically
excludes a dispute over Calculations (as defined in the Agreement) enforcement of Investor’s rights and remedies against
the personal property described in the Security Agreement under the applicable provisions of the Uniform Commercial Code. The
parties hereby agree that the arbitration provisions set forth in this Exhibit
I (“Arbitration Provisions”)
are binding on the parties hereto and are severable from all
other provisions in the Transaction Documents. As a result, any attempt to rescind the Agreement or declare the Agreement or any
other Transaction Document invalid or unenforceable for any reason is subject to these Arbitration Provisions. These Arbitration
Provisions shall also survive any termination or expiration of the Agreement.

 

2.
Arbitration. Except as otherwise provided herein, all Claims
must be submitted to arbitration (“Arbitration”) to be conducted in
Salt Lake County, Utah or Utah County, Utah and pursuant to the terms set forth in these Arbitration Provisions. The parties agree
that the award of the arbitrator shall be final and binding upon the parties; shall be the sole and exclusive remedy between them
regarding any Claims, counterclaims, issues, or accountings presented or pleaded to the arbitrator; and shall promptly be payable
in United States dollars free of any tax, deduction or offset (with respect to monetary awards). Any costs or fees, including
without limitation attorneys’ fees, incident to enforcing the arbitrator’s award shall, to the maximum extent permitted
by law, be charged against the party resisting such enforcement. The award shall include Default Interest (as defined in the Note)
both before and after the award. Judgment upon the award of the arbitrator will be entered and enforced by a state court sitting
in Salt Lake County, Utah. The parties hereby incorporate herein the provisions and procedures set forth in the Utah Uniform Arbitration
Act, U.C.A. § 78B-11-101 et seq. (as amended or superseded
from time to time, the “Arbitration Act”). Pursuant to Section 78B-11-105
of the Arbitration Act, in the event of conflict between the terms of these Arbitration Provisions and the provisions of the Arbitration
Act, the terms of these Arbitration Provisions shall control.

 

3.
Arbitration Proceedings. Arbitration between the parties
will be subject to the following procedures:

 

3.1
Pursuant to Section 110 of the Arbitration Act, the parties agree that a party may initiate Arbitration by giving written notice
to the other party (“Arbitration Notice”) in the same manner that
notice is permitted under Section 9.10 of the Agreement; provided, however,
that the Arbitration Notice may not be given by email or fax. Arbitration will be deemed initiated as of the date that
the Arbitration Notice is deemed delivered under Section 9.10 of the Agreement (the “Service
Date”). After the Service Date, information may be delivered, and notices may be given, by email or fax pursuant
to Section 9.10 of the Agreement or any other method permitted thereunder. The Arbitration Notice must describe the nature of
the controversy, the remedies sought, and the election to commence Arbitration proceedings. All Claims in the Arbitration Notice
must be pleaded consistent with the Utah Rules of Civil Procedure.

 

Arbitration
Provisions, Page 1

 

    	 

    	 

    

 

3.2
Within ten (10) calendar days after the Service Date, Investor shall select and submit to Company the names of three arbitrators
that are designated as “neutrals” or qualified arbitrators by Utah ADR Services (http://www.utahadrservices.com)
(such three designated persons hereunder are referred to herein as the “Proposed Arbitrators”).
For the avoidance of doubt, each Proposed Arbitrator must be qualified as a “neutral” with Utah ADR Services.
Within ten (10) calendar days after Investor has submitted to Company the names of the Proposed Arbitrators, Company must select,
by written notice to Investor, one (1) of the Proposed Arbitrators to act as the arbitrator for the parties under these Arbitration
Provisions. If Company fails to select one of the Proposed Arbitrators in writing within such 10-day period, then Investor may
select the arbitrator from the Proposed Arbitrators by providing written notice of such selection to Company. If Investor fails
to identify the Proposed Arbitrators within the time period required above, then Company may at any time prior to Investor designating
the Proposed Arbitrators, select the names of three arbitrators that are designated as “neutrals” or qualified arbitrators
by Utah ADR Service by written notice to Investor. Investor may then, within ten (10) calendar days after Company has submitted
notice of its selected arbitrators to Investor, select, by written notice to Company, one (1) of the selected arbitrators to act
as the arbitrator for the parties under these Arbitration Provisions. If Investor fails to select in writing and within such 10-day
period one of the three arbitrators selected by Company, then Company may select the arbitrator from its three previously selected
arbitrators by providing written notice of such selection to Investor. Subject to Paragraph 3.12 below, the cost of the arbitrator
must be paid equally by both parties; provided, however,
that if one party refuses or fails to pay its portion of the arbitrator fee, then the other party can advance such unpaid amount
(subject to the accrual of Default Interest thereupon), with such amount added to or subtracted from, as applicable, the award
granted by the arbitrator. If Utah ADR Services ceases to exist or to provide a list of neutrals, then the arbitrator shall be
selected under the then prevailing rules of the American Arbitration Association. The date that the selected arbitrator agrees
in writing to serve as the arbitrator hereunder is referred to herein as the “Arbitration
Commencement Date”.

 

3.3
An answer and any counterclaims to the Arbitration Notice, which must be pleaded consistent with the Utah Rules of Civil Procedure,
shall be required to be delivered to the other party within twenty (20) calendar days after the Service Date. Upon request, the
arbitrator is hereby instructed to render a default award, consistent with the relief requested in the Arbitration Notice, against
a party that fails to submit an answer within such time period.

 

3.4
The party that delivers the Arbitration Notice to the other party shall have the option to also commence legal proceedings with
any state court sitting in Salt Lake County, Utah (“Litigation Proceedings”),
subject to the following: (i) the complaint in the Litigation Proceedings is to be substantially similar to the claims
set forth in the Arbitration Notice, provided that an additional cause of action to compel arbitration will also be included therein,
(ii) so long as the other party files an answer to the complaint in the Litigation Proceedings and an answer to the Arbitration
Notice, the Litigation Proceedings will be stayed pending an award of the arbitrator hereunder, (iii) if the other party fails
to file an answer in the Litigation Proceedings or an answer in the Arbitration Proceedings, then the party initiating Arbitration
shall be entitled to a default judgment consistent with the relief requested, to be entered in the Litigation Proceedings, and
(iv) any legal or procedural issue arising under the Arbitration Act that requires a decision of a court of competent jurisdiction
may be determined in the Litigation Proceedings. Any award of the arbitrator may be entered in such Litigation Proceedings pursuant
to the Arbitration Act.

 

3.5
Pursuant to Section 118(8) of the Arbitration Act, the parties agree that discovery shall be conducted in accordance with the
Utah Rules of Civil Procedure; provided, however, that incorporation
of such rules will in no event supersede the Arbitration Provisions set forth herein, including without limitation the time limitation
set forth in Paragraph 3.9 below, and the following:

 

(a)
Discovery will only be allowed if the likely benefits of the proposed discovery outweigh the burden or expense, and the discovery
sought is likely to reveal information that will satisfy a specific element of a claim or defense already pleaded in the Arbitration.
The party seeking discovery shall always have the burden of showing that all of the standards and limitations set forth in these
Arbitration Provisions are satisfied. The scope of discovery in the Arbitration proceedings shall also be limited as follows:

 

(i)
To facts directly connected with the transactions contemplated by the Agreement.

 

(ii)
To facts and information that cannot be obtained from another source that is more convenient, less burdensome or less expensive.

 

(c)
No party shall be allowed (a) more than fifteen (15) interrogatories (including discrete subparts), (b) more than fifteen (15)
requests for admission (including discrete subparts), (c) more than ten (10) document requests (including discrete subparts),
or (d) more than three depositions (excluding expert depositions) for a maximum of seven (7) hours per deposition.

 

3.6
Any party submitting any written discovery requests, including interrogatories, requests for production, subpoenas to a party
or a third party, or requests for admissions, must prepay the estimated attorneys’ fees and costs, as determined by the
arbitrator, before the responding party has any obligation to produce or respond.

 

Arbitration
Provisions, Page 2

 

    	 

    	 

    

 

(a)
All discovery requests must be submitted in writing to the arbitrator and the other party before issuing or serving such discovery
requests. The party issuing the written discovery requests must include with such discovery requests a detailed explanation of
how the proposed discovery requests satisfy the requirements of these Arbitration Provisions and the Utah Rules of Civil Procedure.
Any party will then be allowed, within ten (10) calendar days of receiving the proposed discovery requests, to submit to the arbitrator
an estimate of the attorneys’ fees and costs associated with responding to such written discovery requests and a written
challenge to each applicable discovery request. After receipt of an estimate of attorneys’ fees and costs and/or challenge(s)
to one or more discovery requests, the arbitrator will make a finding as to the likely attorneys’ fees and costs associated
with responding to the discovery requests and issue an order that (A) requires the requesting party to prepay the attorneys’
fees and costs associated with responding to the discovery requests, and (B) requires the responding party to respond to the discovery
requests as limited by the arbitrator within a certain period of time after receiving payment from the requesting party. If a
party entitled to submit an estimate of attorneys’ fees and costs and/or a challenge to discovery requests fails to do so
within such 10-day period, the arbitrator will make a finding that (A) there are no attorneys’ fees or costs associated
with responding to such discovery requests, and (B) the responding party must respond to such discovery requests (as may be limited
by the arbitrator) within a certain period of time as determined by the arbitrator.

 

(b)
In order to allow a written discovery request, the arbitrator must find that the discovery request satisfies the standards set
forth in these Arbitration Provisions and the Utah Rules of Civil Procedure. The arbitrator must strictly enforce these standards.
If a discovery request does not satisfy any of the standards set forth in these Arbitration Provisions or the Utah Rules of Civil
Procedure, the arbitrator may modify such discovery request to satisfy the applicable standards, or strike such discovery request
in whole or in part.

 

(c)
Discovery deadlines will be set forth in a scheduling order issued by the arbitrator. The parties hereby authorize and direct
the arbitrator to take such actions and make such rulings as may be necessary to carry out the parties’ intent for the arbitration
proceedings to be efficient and expeditious.

 

3.7
Each party may submit expert reports (and rebuttals thereto), provided that such reports must be submitted by the deadlines established
by the arbitrator. Expert reports must contain the following: (a) a complete statement of all opinions the expert will offer at
trial and the basis and reasons for them; (b) the expert’s name and qualifications, including a list of all publications
within the preceding 10 years, and a list of any other cases in which the expert has testified at trial or in a deposition or
prepared a report within the preceding 10 years; and (c) the compensation to be paid for the expert’s study and testimony.
The parties are entitled to depose any other party’s expert witness one time for no more than 4 hours. An expert may not
testify in a party’s case-in-chief concerning any matter not fairly disclosed in the expert report.

 

3.8
All information disclosed by either party during the Arbitration process (including without limitation information disclosed during
the discovery process) shall be considered confidential in nature. Each party agrees not to disclose any confidential information
received from the other party during the discovery process unless (i) prior to or after the time of disclosure such information
becomes public knowledge or part of the public domain, not as a result of any inaction or action of the receiving party, (ii)
such information is required by a court order, subpoena or similar legal duress to be disclosed if such receiving party has notified
the other party thereof in writing and given it a reasonable opportunity to obtain a protective order from a court of competent
jurisdiction prior to disclosure; or (iii) disclosed to the receiving party’s agents, representatives and legal counsel
on a need to know basis who each agree in writing not to disclose such information to any third party. Pursuant to Section 118(5)
of the Arbitration Act, the arbitrator is hereby authorized and directed to issue a protective order to prevent the disclosure
of privileged information and confidential information upon the written request of either party.

 

3.9
The parties hereby authorize and direct the arbitrator to take such actions and make such rulings as may be necessary to carry
out the parties’ intent for the arbitration proceedings to be efficient and expeditious. Pursuant to Section 120 of the
Arbitration Act, the parties hereby agree that an award of the arbitrator must be made within 150 days after the Arbitration Commencement
Date. The arbitrator is hereby authorized and directed to hold a scheduling conference within ten (10) calendar days after the
Arbitration Commencement Date in order to establish a scheduling order with various binding deadlines for discovery, expert testimony,
and the submission of documents by the parties to enable the arbitrator to render a decision prior to the end of such 150-day
period. The Utah Rules of Evidence will apply to any final hearing before the arbitrator.

 

Arbitration
Provisions, Page 3

 

    	 

    	 

    

 

3.10
The arbitrator shall have the right to award or include in the arbitrator’s award any relief which the arbitrator deems
proper under the circumstances, including, without limitation, specific performance and injunctive relief, provided that the arbitrator
may not award exemplary or punitive damages.

 

3.11
If any part of these Arbitration Provisions is found to violate applicable law or to be illegal, then such provision shall be
modified to the minimum extent necessary to make such provision enforceable under applicable law.

 

3.12
The arbitrator is hereby directed to require the losing party to (i) pay the full amount of the costs and fees of the arbitrator,
and (ii) reimburse the prevailing party the reasonable attorneys’ fees, arbitrator costs, deposition costs, and other discovery
costs incurred by the prevailing party.

 

[Remainder
of page intentionally left blank]

 

Arbitration
Provisions, Page 4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00236-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00236-of-00352.parquet"}]]