Document:

Exhibit 10.27

                              EMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT ("Agreement"), effective as of December 16, 2008
(the "Effective Date), is made and entered into by and between Clearfield, Inc.,
a Minnesota  corporation  (hereinafter referred to as the "Company") and John P.
Hill (the "Executive").

      WHEREAS,  the Company  desires to employ the  Executive  and the Executive
desires to accept employment with the Company, upon the terms and conditions set
forth in this Agreement.

      NOW,  THEREFORE,  in  consideration  of the  premises  and other  good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto agree as follows:

      1.    Employment and Employment Period
            --------------------------------

      The Company  agrees to employ the Executive  and the  Executive  agrees to
accept such employment  upon the terms and conditions set forth herein.  Subject
to the provisions for earlier termination  hereinafter provided, the Executive's
employment hereunder shall be for a term (the "Employment Period") commencing on
the Effective  Date and ending on the third  anniversary  of the Effective  Date
(the "Initial Termination Date");  provided,  however, that this Agreement shall
be  automatically  extended for one additional  year on the Initial  Termination
Date and on each subsequent  anniversary of the Initial  Termination Date unless
either  the  Executive  or the  Company  elects not to so extend the term of the
Agreement by notifying  the other party,  in writing,  of such election not less
than sixty (60) days prior to the last day of the term then in effect.

      2.   Terms of Employment
           -------------------

            (a) Position and Duties.

                    (i) During the Employment  Period, the Executive shall serve
as Chief Operating Officer and shall perform such employment duties as are usual
and customary for such positions.  During the Employment  Period,  the Executive
shall be a member of the Executive  Management Committee of the Company, and the
Executive  shall  report  directly to the Board of Directors of the Company (the
"Board") or its designee.  The Executive Management Committee shall, as a group,
review and consider all major business  policies,  strategies and initiatives of
the Company and its affiliates.  The Executive shall be officed at the Company's
main headquarters offices in Plymouth,  Minnesota;  provided,  however, that the
Executive  understands that travel will be a required component of the position.
At the  Company's  request,  the  Executive  shall serve the Company  and/or its
subsidiaries and affiliates in other positions and capacities in addition to the
foregoing. In the event that the Executive, during the Employment Period, serves
in any one or more of such additional capacities,  the Executive's  compensation
may (or may not) be  increased  beyond that  specified  in Section  2(b) of this
Agreement,  in the  Company's  sole  discretion.  In addition,  in the event the
Executive's service in one or more of such additional capacities is subsequently
terminated,  the Executive's compensation,  as specified in Section 2(b) of this
Agreement,  shall not be diminished or reduced in any manner as a result of such
termination for so long as the Executive  otherwise  remains  employed under the
terms of this Agreement.
<PAGE>

                    (ii) During the Employment Period, and excluding any periods
of vacation and sick leave to which the  Executive is  entitled,  the  Executive
agrees to devote substantially all of his business time, energy, skills and best
efforts  to the  performance  of his  duties  hereunder  in a manner  that  will
faithfully  and  diligently  further the business and  interests of the Company.
Notwithstanding  the foregoing,  during the Employment  Period it shall not be a
violation of this Agreement for the Executive to (A) serve on civic,  charitable
or other  boards or  committees;  provided,  however,  that the  Executive  will
consult  with the  Chairman  of the Board  prior to  accepting a position on the
board of any publicly traded company;  (B) deliver  lectures,  fulfill  speaking
engagements  or teach at  educational  institutions;  or (C) manage his personal
investments,  so long as such  activities do not  materially  interfere with the
performance of the Executive's  responsibilities  as an executive officer of the
Company.

                    (iii) The  Executive  agrees  that he will not take personal
advantage of any business  opportunity  that arises during his employment by the
Company and which may be of benefit to the  Company  unless all  material  facts
regarding such opportunity are timely reported by the Executive to the Board for
consideration  by the  Company  and  the  disinterested  members  of  the  Board
determine to reject the opportunity and to approve the Executive's participation
therein.

            (b)   Compensation, Benefits, Equity Grants.
                    (i) Base Salary. During the Employment Period, the Executive
shall  receive a base salary of $170,000 per annum (the "Base  Salary"),  as the
same may be increased  thereafter  (or thereafter  decreased,  but not below the
initial  Base  Salary)  pursuant  to the  Company's  normal  practices  for  its
executives.  The Base  Salary  shall be paid at such  intervals  as the  Company
customarily  pays executive  salaries.  During the Employment  Period,  the Base
Salary shall be reviewed at least  annually for possible  increase (or decrease,
but  not  below  the  initial  Base  Salary),  as  determined  by the  Company's
compensation  committee,  in its sole  discretion.  Any  increase in Base Salary
shall not serve to limit or reduce any other  obligation to the Executive  under
this Agreement. The term "Base Salary" as utilized in this Agreement shall refer
to Base Salary as so adjusted.

                    (ii)  Annual  Bonus.  In addition  to the Base  Salary,  the
Executive  shall be eligible to earn, for each fiscal year of the Company ending
during the  Employment  Period,  an annual  cash  performance  bonus (an "Annual
Bonus").  The  amount of the  Annual  Bonus  and the  target  performance  goals
applicable to the Annual Bonus shall be determined in accordance  with the terms
and conditions of said bonus plan as in effect from time to time;  provided that
Executive's  target for each Annual Bonus  hereunder shall be 40% of Base Salary
for that year,  and his  maximum  Annual  Bonus shall be 150% of Base Salary for
that year.  The terms and  conditions of any such bonus plan shall be determined
by the Company's compensation committee of the Board in its sole discretion.

                     (iii) Sign-On Bonus.  The Executive shall receive a sign-on
bonus in the amount of $2,000  within   fifteen  (15)  days  of  the   Effective
Date  as  additional consideration  for the Executive's  agreement to the terms
and conditions herein and his execution of this Agreement.

                     (iv) Welfare Benefit Plans.  During the Employment  Period,
the Executive and the  Executive's  eligible family members shall be eligible to
participate  in the welfare  benefit  plans,  practices,  policies  and programs
(including,  if applicable,  medical, dental,  disability,  employee life, group
life and  accidental  death  insurance  plans and  programs)  maintained  by the
Company for its senior executives.
<PAGE>

                    (v) Expenses.  During the Employment  Period,  the Executive
shall be entitled to receive prompt  reimbursement  for all reasonable  business
expenses  incurred by the Executive in accordance  with the policies,  practices
and procedures of the Company provided to senior executives of the Company.

                    (vi) Fringe  Benefits.  During the  Employment  Period,  the
Executive  shall be entitled to receive such fringe  benefits and perquisites as
are  provided  by the  Company to its senior  executives  from time to time,  in
accordance with the policies, practices and procedures of the Company.

                    (vii) Vacation.  During the Employment Period, the Executive
shall be  entitled  to  receive  paid  vacation  in  accordance  with the plans,
policies,  programs  and  practices  of the  Company  applicable  to its  senior
executives.

      3.   Termination of Employment
           -------------------------

         (a) The Executive's  employment  shall continue from the Effective Date
until it is terminated  by the Company or the  Executive in accordance  with the
terms of this Agreement.

         (b) Death. The Executive's employment will terminate automatically upon
the Executive's death.

         (c) Disability.  To the extent  consistent with federal and state laws,
Executive's employment may be terminated if Executive suffers a Disability.  For
purposes of this  Agreement,  "Disability"  means a physical  or mental  illness
which renders  Executive  unable to perform his essential duties for ninety (90)
consecutive  days or a total of one hundred and eighty  (180) days in any twelve
(12)  month  period  with or  without  reasonable  accommodations,  or unable to
perform those duties in a manner that would not endanger his health or safety or
the  health  or  safety  of others  even  with  reasonable  accommodations.  The
existence  of a  Disability  shall  be  determined  through  the  opinion  (to a
reasonable  medical  certainty)  of an  independent  physician  selected  by the
Company or its  insurers  and  reasonably  acceptable  to the  Executive  or the
Executive's legal representative.  The Company is not, however, required to make
unreasonable accommodations for Executive or accommodations that would create an
undue hardship for the Company

         (d) Cause. The Company may terminate the Executive's  employment during
the  Employment  Period for Cause or without  Cause.  For the  purposes  of this
Agreement, "Cause" shall mean the occurrence of any one or more of the following
events:

                  (i) The  Executive's  willful  failure  to  perform  or  gross
         negligence  in  performing  his duties owed to the Company  (other than
         such failure  resulting  from the  Executive's  Disability  or any such
         actual failure after his issuance of a Notice of  Termination  for Good
         Reason),  which  continues  after thirty (30) days  following a written
         notice delivered to the Executive by the Board,  which notice specifies
         such willful failure or gross negligence;

                  (ii)  The  Executive's  commission  of  an  act  of  fraud  or
dishonesty in the performance of his duties;
<PAGE>

                  (iii) The Executive's conviction of, or entry by the Executive
of a guilty or no contest plea to, any felony or a misdemeanor  involving  moral
turpitude;

                  (iv) Any material  breach by the  Executive  of any  fiduciary
duty or duty of loyalty owed to the Company; or

                  (v) The  Executive's  material breach of any of the provisions
of this Agreement  which is not cured within thirty (30) days following  written
notice thereof from the Company.

            (e) Good Reason. The Executive's employment may be terminated by the
Executive for Good Reason or by the Executive without Good Reason.  For purposes
of this Agreement, "Good Reason" shall mean the occurrence of any one or more of
the following  events without the Executive's  prior written  consent,  provided
that the Executive terminates his employment within one hundred and eighty (180)
days following the lapse of the Company's cure period  described below as to one
or more of such events and unless the Company fully  corrects the  circumstances
constituting Good Reason (provided such circumstances are capable of correction)
prior to the Date of Termination:

                  (i) The  Company's  reduction of the  Executive's  annual base
salary  below the initial Base Salary or  reduction  in the  Executive's  target
annual bonus;

                  (ii) The Company's  material change of the Executive's  duties
in a manner  inconsistent with the Executive's  position,  authority,  duties or
responsibilities  as contemplated by Section 2(a) or other action by the Company
which   materially    diminishes   such   position,    authority,    duties   or
responsibilities,   excluding  for  this  purpose  isolated,   insubstantial  or
inadvertent  action not taken in bad faith and which is  remedied by the Company
promptly after receipt of notice thereof from Executive;

                  (iii)  The  relocation  of  the  Company's  offices  at  which
Executive  is  principally  employed to a location  more than 50 miles from such
offices;

                  (iv) The failure of a  successor  to the Company to (A) assume
and agree to perform the  obligations of the Company  hereunder,  or (B) replace
this  Agreement  with an  employment  contract of  substantially  similar  terms
acceptable to the Executive and no less  favorable  than those terms provided to
an acquiring Company's executive officers; or

                  (v) The Company's material breach of its obligations under the
Agreement.

      Notwithstanding  any other  provision of this Section 3(e), the occurrence
of any event  described in Section  3(e)(i) or (v) shall  constitute Good Reason
only  if (A)  the  Executive  provides  written  notice  to the  Company  of the
occurrence  of such event within  ninety (90) days of the initial  occurrence of
such  event,  and (B) the  Company  fails to remedy the event  described  in the
Executive's  written notice within thirty (30) days of the Company's  receipt of
such notice.
<PAGE>

            (f) Notice of Termination. Any termination by the Company for Cause,
or by the  Executive  for  Good  Reason,  shall be  communicated  by  Notice  of
Termination to the other party hereto given in accordance  with Section 12(c) of
this Agreement.  For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination  provision in this
Agreement relied upon, (ii) to the extent  applicable,  sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated, and (iii) specifies
the Date of  Termination  (which  date shall be not less than  thirty  (30) days
after the giving of such notice). The failure by the Executive or the Company to
set  forth  in  the  Notice  of  Termination  any  fact  or  circumstance  which
contributes  to a showing of Good  Reason or Cause  shall not waive any right of
the Executive or the Company, respectively,  hereunder or preclude the Executive
or the  Company,  respectively,  from  asserting  such fact or  circumstance  in
enforcing the Executive's or the Company's rights hereunder.

      4.   Obligations of the Company Upon Termination
           -------------------------------------------

               (a) Without Cause, For Good Reason or The Company's  Non-Renewal.
If, during the Employment  Period,  the Company shall  terminate the Executive's
employment  without Cause, the Executive shall terminate his employment for Good
Reason,  or the  Company  elects  not to extend  the term of this  Agreement  in
accordance  with Section 1, then the Executive  will receive those  payments and
benefits  set forth below.  The timing of the  payments  hereunder is subject to
Section 12(e) hereof:

                    (i) The  Executive  shall be paid,  in two lump sum payments
(A) the  Executive's  earned  but unpaid  Base  Salary  and  accrued  but unpaid
vacation pay through the Date of  Termination,  and any Annual Bonus required to
be paid to the Executive  pursuant to Section 2(b)(ii) above for any fiscal year
of the Company that ends on or before the Date of  Termination to the extent not
previously paid (the "Accrued  Obligations"),  and (B) an amount (the "Severance
Amount")  equal to two (2) times the sum of (1) the Base Salary in effect on the
Date of Termination, plus (2) the average Annual Bonus received by the Executive
for the three (3) complete fiscal years as the Chief Executive  Officer (or such
lesser number of years as the Executive has been employed as the Chief Executive
Officer) of the Company immediately prior to the Date of Termination;

                    (ii) At the time annual  bonuses  are paid to the  Company's
other senior  executives for the fiscal year of the Company in which the Date of
Termination  occurs,  the  Executive  shall be paid an Annual Bonus in an amount
equal to the  product  of (A) the  amount  of the  Annual  Bonus  to  which  the
Executive  would have been entitled if the  Executive's  employment had not been
terminated,  and (B) a fraction, the numerator of which is the number of days in
such fiscal year through the Date of Termination and the denominator of which is
the total number of days in such fiscal year (a "Pro-Rated Annual Bonus");

                    (iii)  If  Executive  (or  any  of   Executive's   qualified
beneficiaries)  makes a  timely  election  to  continue  to  participate  in the
Company's group health plans (medical, dental, and vision) pursuant to 29 U.S.C.
ss.ss. 1161-1169 ("COBRA"),  the Company shall pay the premium for such coverage
(which  premium  payment  shall be taxable to Executive if the  Company's  group
health plans are self-insured) starting on the Date of Termination and ending on
the earlier of (A) the date that is one (1) year after the Date of  Termination,
or (B) the  date on which  Executive  no  longer  is  eligible  to  continue  to
participate under COBRA. For purposes of the foregoing, the usual limitations of
COBRA shall apply and the Company's  payment of the COBRA  premium(s)  shall not
extend the continuation period, which begins on the Date of Termination;

                    (iv) Any unvested  stock  options  shall become  immediately
vested in full; and

                    (v) To the  extent not  theretofore  paid or  provided,  the
Company  shall timely pay or provide to the  Executive  any vested  benefits and
other amounts or benefits required to be paid or provided or which the Executive
is eligible to receive as of the Date of Termination under any plan, contract or
agreement  of the Company and its  affiliates  (such other  amounts and benefits
shall be hereinafter referred to as the "Other Benefits") to which the Executive
is a party.
<PAGE>

      Notwithstanding  anything to the contrary in this Section 4, it shall be a
condition  to the  Executive's  right to receive the amounts  provided for above
that the Executive  execute,  deliver to the Company and not revoke a release of
claims in substantially the form attached hereto as Exhibit A.

             (b) For Cause or Without Good Reason. If the Executive's employment
shall be terminated  by the Company for Cause or by the  Executive  without Good
Reason  during  the  Employment  Period,  the  Company  shall  have  no  further
obligations  to the  Executive  under  this  Agreement  other than  pursuant  to
Sections 6 and 7 hereof,  and the obligation to pay to the Executive the Accrued
Obligations  when due under  Minnesota law and to provide the Other  Benefits in
accordance with the provisions of the applicable plan, program, agreement and/or
law.

            (c) Death or Disability. If the Executive's employment is terminated
by reason of the Executive's Death or Disability during the Employment Period:

                    (i) The Accrued Obligations shall be paid to the Executive's
estate or beneficiaries or to the Executive,  as applicable,  in a lump-sum cash
payment when due under Minnesota law;

                    (ii)  100%  of the  Executive's  then  current  annual  Base
Salary,  as in  effect  on  the  Date  of  Termination,  shall  be  paid  to the
Executive's  estate or  beneficiaries  or the  Executive,  as  applicable,  in a
lump-sum cash payment within twenty (20) days following the Date of Termination;

                    (iii)  The  Pro-Rated  Annual  Bonus  shall  be  paid to the
Executive's estate or beneficiaries or to the Executive,  as applicable,  at the
time when annual bonuses are paid to the Company's  other senior  executives for
the fiscal year of the Company in which the Date of Termination occurs;

                    (iv) If any of the Executive's qualified beneficiaries makes
a timely election to continue to participate in the Company's group health plans
pursuant to COBRA,  the Company shall pay the premium for such  coverage  (which
premium  payment  shall be taxable to  Executive if the  Company's  group health
plans are  self-insured)  starting on the Date of Termination  and ending on the
earlier of (A) the date that is one (1) year after the Date of  Termination,  or
(B) the date on  which  the  Executive's  qualified  beneficiary  no  longer  is
eligible to continue to participate  under COBRA. For purposes of the foregoing,
the usual  limitations  of COBRA  shall apply and the  Company's  payment of the
COBRA premium(s) shall not extend the continuation  period,  which begins on the
Date of Termination; and

                    (v) The  Other  Benefits  shall be paid or  provided  to the
Executive's  estate or  beneficiaries or to the Executive,  as applicable,  on a
timely basis.

      Notwithstanding  anything to the  contrary in this  Section  4(c),  in the
event the  Executive's  employment is terminated  by reason of  Disability,  the
amount  described in Section  4(c)(ii)  shall be paid to Executive no later than
March 15th of the calendar year immediately following the calendar year in which
the Executive suffers such Disability.
<PAGE>

      5.    Termination Upon a Change in Control
            ------------------------------------

      If  a  Change  in  Control  (as  defined  in  the  Company's   2007  Stock
Compensation  Plan as in effect on December 16, 2008,  but  excluding  from such
definition  Section 8(b)(ii)  thereof)) occurs during the Employment Period, the
Company  shall pay to the  Executive  a lump sum  payment  in the  amount of the
Executive's  Base Salary in effect on the date of the Change in Control.  If the
Executive's  employment  is  terminated  by the Company  without Cause or by the
Executive  for Good Reason or without Good Reason  within one (1) year after the
effective  date of the  Change  in  Control  (the "CIC  Anniversary"),  then the
Executive  shall also be entitled to receive the payments and benefits  provided
in Section 4(a), subject to the terms and conditions  thereof.  For the purposes
of this Section, the calculation of the Executive's average Annual Bonus will be
the greater of (a) the average  Annual Bonus  received by the  Executive for the
three (3) complete fiscal years as the Chief  Executive  Officer (or such lesser
number  of years as the  Executive  has been  employed  as the  Chief  Executive
Officer) of the Company  immediately prior to the date of the Change in Control,
and (b) the amount  representing  the  Executive's  Base Salary in effect on the
date of the Change in Control.  The timing of the foregoing  payments is subject
to Section 12(e) hereof. In addition,  in the event of such a termination of the
Executive's  employment,  all outstanding  stock options,  restricted  stock and
other equity awards granted to the Executive  under any of the Company's  equity
plans (or awards  substituted  therefor  covering the  securities of a successor
company) shall become immediately vested and exercisable in full.

      6.    Full and Final Settlement
            -------------------------

      In no event shall the  Executive be obligated to seek other  employment or
take any  other  action  by way of  mitigation  of the  amounts  payable  to the
Executive under any of the provisions of this Agreement and, except as expressly
provided, such amounts shall not be reduced whether or not the Executive obtains
other employment.  If any party to this Agreement  institutes any action,  suit,
counterclaim,  appeal,  arbitration or mediation for any relief against  another
party, declaratory or otherwise (collectively an "Action"), to enforce the terms
of this Agreement or to declare rights  hereunder,  then the Prevailing Party in
such Action shall be entitled to recover  from the other  party,  in addition to
all  applicable  remedies,  all  costs and  expenses  of the  Action,  including
reasonable  attorneys'  fees and costs  (at the  Prevailing  Party's  attorneys'
then-prevailing  rates)  incurred in bringing and  prosecuting or defending such
Action and/or enforcing any judgment,  order, ruling or award  (collectively,  a
"Decision") granted therein, all of which shall be deemed to have accrued on the
commencement  of such  Action and shall be paid  whether  or not such  Action is
prosecuted  to a Decision.  Any Decision  entered in such Action shall contain a
specific  provision  providing  for the  recovery of  attorneys'  fees and costs
incurred in enforcing such Decision.  A court or arbitrator shall fix the amount
of reasonable  attorneys'  fees and costs upon the request of either party.  Any
judgment  or order  entered  in any final  judgment  shall  contain  a  specific
provision  providing  for the  recovery  of all  costs  and  expenses  of  suit,
including  reasonable  attorneys'  fees and expert  fees and costs  incurred  in
enforcing,  perfecting  and executing  such  judgment.  For the purposes of this
Section, costs shall include, without limitation,  in addition to costs incurred
in prosecution or defense of the underlying action,  reasonable attorneys' fees,
costs,  expenses  and  expert  fees and costs  incurred  in the  following:  (a)
post-judgment  motions and collection  actions;  (b) contempt  proceedings;  (c)
garnishment,  levy,  debtor and third party  examinations;  (d)  discovery;  (e)
bankruptcy  litigation;  and (f) appeals of any order or  judgment.  "Prevailing
Party" within the meaning of this Section includes,  without limitation, a party
who agrees to dismiss an Action (excluding an Action instituted in contravention
of the  requirements  of Paragraph 12(b) below) in  consideration  for the other
party's  payment of the amounts  allegedly due or  performance  of the covenants
allegedly breached, or obtains substantially the relief sought by such party.
<PAGE>

      7.   Certain Additional Payments by the Company
           ------------------------------------------

      Anything in this Agreement to the contrary  notwithstanding  and except as
set forth herein,  in the event it shall be  determined  that any payment to the
Executive hereunder would be subject to an excise tax, then the Executive may be
entitled  to  receive  an  additional  payment  under the  Company's  Excise Tax
Gross-Up Payment Plan provided to senior executives of the Company.

       8.  Non-Competition, Non-Solicitation and Protection of Confidential
           Information
           ----------------------------------------------------------------

         (a) Non-Competition and  Non-Solicitation.  The Executive  acknowledges
that: (i) the business in which the Company competes is highly competitive; (ii)
as a key executive, he will participate in servicing current clients and vendors
and/or soliciting  prospective clients and vendors,  through which the Executive
will obtain  knowledge of the "know-how" and business  practices of the Company,
in which matters the Company has a substantial  proprietary interest;  (iii) his
employment  requires the performance of services that are special,  unique,  and
extraordinary,  and his  position  with the Company  places his in a position of
confidence and trust with the Company's clients, vendors and employees; and (iv)
his rendering of services to the Company's clients and vendors  necessarily will
require the disclosure to the Executive of confidential  information (as defined
in Section  8(b) hereof) of the Company.  In the course of his  employment,  the
Executive will develop  personal  relationships  with the Company's  clients and
vendors and knowledge of those clients' and vendors'  affairs and  requirements,
and the Company's  relationship  with its clients and vendors will  therefore be
placed in the  Executive's  hands in confidence  and trust.  Thus, the Executive
agrees that it is a  legitimate  interest of the  Company,  and  reasonable  and
necessary for the protection of the Company's confidential information, goodwill
and business,  that the Executive make the covenants  contained  herein and that
the Company would not have entered into this  Agreement  unless it contained the
covenants in this Section 8. The Executive therefore agrees that for a period of
two (2)  years  after  the  date of his  termination  from  employment  with the
Company,  he  will  not,  as  an  employee,  consultant,   contractor,  partner,
shareholder,  or in association with, any other person,  business or enterprise,
except on behalf of the Company,  directly or indirectly,  and regardless of the
reason for his ceasing to be employed by the Company:

                  (i) Engage in any business  with any person or entity who: (A)
                  was a customer  of the  Company  within the twelve (12) months
                  before the Executive's  employment  termination,  and (B) with
                  whom  Executive had contact to further the Company's  business
                  or for whom Executive  performed  services,  or supervised the
                  provision of services, during Executive's employment;

                  (ii)  Hire,  employ,   recruit  or  solicit  any  employee  or
                  consultant of the Company;

                  (iii) Solicit, induce or influence any employee, consultant or
                  customer  of  the  Company  to  terminate   his,  his  or  its
                  employment or other relationship with the Company;

                  (iv)  Engage or  participate  in,  or in any other way  render
                  services  or  assistance   to,  any  business  that  competes,
                  directly  or  indirectly,  with any  product or service of the
                  Company that  Executive  participated  in,  engaged in, or had
                  Confidential   Information   regarding,   during   Executive's
                  employment. Ownership of less than 2% of the total outstanding
                  stock or securities of a competitor of the Company listed on a
                  national  securities  exchange  is  not a  violation  of  this
                  Section; or

                  (v) Assist anyone in any of the activities listed above.
<PAGE>

         (b) Confidential  Information.  During the Executive's  employment with
the Company,  he will  acquire and have access to  confidential  or  proprietary
information  about the Company and/or its  customers,  including but not limited
to, trade secrets,  information  relating to the Company's  business,  research,
marketing,  sales,  operations  and  products and plans for  development  of new
business products and services,  operational  designs and techniques  related to
business,  marketing and financial  information or data concerning the Company's
business  and  business  opportunities,  information  relating to the  Company's
suppliers,  vendors,  consultants,  agents and  customers,  including  lists and
compilations of such persons and entities, information relating to the Company's
officers,  directors and  shareholders,  including their  respective  abilities,
functions,  conduct  and  compensation,   proprietary  information  received  or
developed under agreement or other arrangement by the Company and third parties,
and unpublished  materials received or developed (including works of authorship)
which  relate to the  business  of the Company  and its  investment  strategies,
development   plans,   research  and  development   data,  and  other  technical
information.  The foregoing shall be collectively  referred to as  "Confidential
Information".  The Executive is aware that the  Confidential  Information is not
readily available to the public; accordingly, he also agrees that he will not at
any time (whether  during or after the  Employment  Period),  disclose to anyone
(other  than his  counsel in the course of a dispute  arising  from the  alleged
disclosure of Confidential  Information or as required by law) any  Confidential
Information or utilize such Confidential  Information for the benefit of herself
or any third party.  The Executive  agrees that these  restrictions  shall apply
whether or not any such information is marked  "confidential"  and regardless of
the form of the  information.  If the  Executive  becomes  legally  required  to
disclose any Confidential  Information,  he will provide the Company with prompt
notice thereof so the Company may seek a protective  order or other  appropriate
remedy  and/or  waive  compliance  with the  provisions  of this Section 8(b) to
permit a particular disclosure.  If such protective order or other remedy is not
obtained or if the Company waives compliance with the provisions of this Section
8(b) to permit a particular  disclosure,  the  Executive  will furnish only that
portion of the Confidential  Information that he is legally required to disclose
and,  at the  Company's  expense,  will  cooperate  with the Company to obtain a
protective order or other reliable assurance that confidential treatment will be
accorded the  Confidential  Information.  The Executive  further agrees that all
memoranda,  disks,  files,  notes,  records  or  other  documents,   whether  in
electronic form or hard copy (collectively,  the "Material")  compiled by him or
made available to him during  employment with the Company and/or its predecessor
(whether or not the Material constitutes or contains Confidential  Information),
and in connection  with the  performance of his duties  hereunder,  shall be the
property of the Company and shall be delivered to the Company on the termination
of the  Executive's  employment  with the  Company  or at any  other  time  upon
request.  Except in connection with the Executive's employment with the Company,
the  Executive  agrees that he will not make or retain copies or excerpts of the
Material.

         (c) Remedies.  If the Executive  commits a breach, or is threatening to
commit a breach,  of any of the  provisions  of Section 8(a) or (b), the Company
shall  have the  right to have the  provisions  of this  Agreement  specifically
enforced by any court having jurisdiction without being required to post bond or
other  security  and without  having to prove the  inadequacy  of the  available
remedies  at law,  it being  acknowledged  and  agreed  that any such  breach or
threatened  breach will cause  irreparable  injury to the Company and that money
damages  will not provide an adequate  remedy to the Company.  In addition,  the
Company may take all such other  actions and remedies  available to it under law
or in  equity  and  shall  be  entitled  to such  damages  as it can show it has
sustained by reason of such breach.
<PAGE>

         (d) Acknowledgements. The parties acknowledge that (i) the restrictions
imposed in  Sections  8(a) and (b) are fair and  reasonable  and are  reasonably
required to protect the Company's  proprietary  interests  and other  legitimate
business  interests,  and the goodwill  associated with the Company's  business;
(ii) the time,  scope,  geographic,  and other provisions of this Section 8 have
been  specifically  negotiated by  sophisticated  parties  represented  by legal
counsel;  and (iii) given the nature of the  Company's  business  and given that
clients can be and are serviced by the Company wherever they are located,  it is
impractical and unreasonable to place  geographic  limitations on the agreements
made by the Executive herein. If any covenant contained in Sections 8(a) and (b)
is held to be unenforceable by reason of its duration or geographic scope or its
being too  extensive in any other  respect,  the parties agree (A) such covenant
shall be interpreted to extend over the maximum duration or geographic areas for
which it may be enforceable and over the maximum extent in all other respects as
to which it may be  enforceable,  all as  determined  by the court  making  such
determination, and (B) in its reduced form, such covenants shall be enforceable;
but such  reduced  form shall apply only with  respect to the  operation of such
covenant in the particular  jurisdiction  in or for which such  adjudication  is
made.  Each  of the  covenants  and  agreements  contained  in  this  Section  8
(collectively, the "Restrictive Covenants") is separate, distinct and severable.
All rights,  remedies and benefits  expressly provided for in this Agreement are
cumulative  and are not exclusive of any rights,  remedies or benefits  provided
for by law or in this Agreement, and the exercise of any remedy by a party shall
not be deemed an election to the  exclusion  of any other remedy (any such claim
by the other party being hereby waived).  The existence of any claim, demand, or
cause of action of the  Executive  against the  Company,  whether  based on this
Agreement  or  otherwise,  shall  not  constitute  a  defense  to the  Company's
enforcement of any Restrictive Covenant. The unenforceability of any Restrictive
Covenant  shall  not  affect  the  validity  or   enforceability  of  any  other
Restrictive  Covenant or other  provisions of this Agreement.  The Executive and
the  Company  understand  and agree  that the  Restrictive  Covenants  and other
provisions in this Section 8 survive,  and continue to be effective according to
their  terms  after,  the  termination  of the  Executive's  employment  and the
termination of this Agreement.

         (e) Notification of Restrictive Covenants.  Before accepting employment
or  consulting  work with any person,  corporation  or other  entity  during the
Employment  Period or any period thereafter that the Executive is subject to the
restrictions  set forth in Section 8(a) above,  the  Executive  shall notify the
prospective employer,  person or entity in writing of her obligations under such
provisions and shall simultaneously provide a copy of such written notice to the
Company.

         (f) Tolling.  The duration of the  Restrictive  Covenants  set forth in
this Agreement shall not expire, and shall be tolled, during any period in which
the Executive is in violation of any of those  covenants,  and all  restrictions
shall  automatically  be extended by the period of the Executive's  violation of
any such covenants.

         (g) Scope.  As used in this Section 8, the term "Company" shall include
all subsidiaries and affiliates of the Company.
<PAGE>

       9.   Intellectual Property
            ---------------------

         The  Executive  agrees  that all  materials  created or modified by him
during  the  Employment  Period  including,  without  limitation,  all  works of
authorship,  inventions,  processes, ideas, methods, concepts and other tangible
and intangible  materials  (collectively,  "Work  Product"),  shall be "work for
hire" and that the Company shall be the exclusive  owner of the Work Product and
all intellectual property rights associated with the Work Product, including all
trademarks,  patents or  copyrights  contained  therein.  To the extent any Work
Product  does not  qualify  as "work for  hire," the  Executive  hereby  assigns
ownership  of all such  Work  Product  to the  Company  and  agrees  to take all
reasonable  measures,  at the Company's  expense,  to perfect such rights in the
Company. The Executive hereby appoints the Company as his attorney-in-fact  with
the limited power to execute assignments of such Work Product.

       10.  Enforceability
            --------------

         The failure of any party to require performance by another party of any
provision  shall not affect the right of that party  thereafter  to enforce  the
same,  nor shall it affect any other  party's  right to  enforce  the same or to
enforce  any other  provisions  in this  Agreement;  nor shall the waiver by any
party of the  breach  of any  provision  hereof  be held to be a  waiver  of any
subsequent breach of such provision or as a waiver of the provision itself.

      11.   Successors
            ----------

               (a) This  Agreement is personal to the  Executive and without the
prior  written  consent of the Company  shall not be assignable by the Executive
otherwise than by will or the laws of descent and  distribution.  This Agreement
shall  inure to the  benefit  of and be  enforceable  by the  Executive's  legal
representatives.

            (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

      12.   Miscellaneous
            -------------

            (a) Governing Law. This Agreement shall be governed by and construed
in  accordance  with the laws of the State of  Minnesota,  without  reference to
principles of conflicts of laws.  The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect.  This Agreement may not
be amended or modified  otherwise  than by a written  agreement  executed by the
parties hereto or their respective successors and legal representatives.

            (b)  Arbitration.   To  the  fullest  extent  allowed  by  law,  any
controversy,  claim or dispute between  Executive and the Company (and/or any of
its owners, directors,  officers, employees,  affiliates, or agents) relating to
or arising out of  Executive's  employment,  the  cessation  of that  employment
and/or any right or obligation  under this  Agreement will be submitted to final
and  binding   arbitration  in  the  county  in  which  Executive  work(ed)  for
determination in accordance with the American Arbitration  Association's ("AAA")
National  Rules for the  Resolution  of  Employment  Disputes,  as the exclusive
remedy for such  controversy,  claim or dispute.  In any such  arbitration,  the
parties may conduct  discovery in accordance  with the  applicable  rules of the
arbitration forum,  except that the arbitrator shall have the authority to order
and permit  discovery as the arbitrator  may deem  necessary and  appropriate in
accordance with applicable state or federal discovery  statutes.  The arbitrator
shall issue a reasoned, written decision, and shall have full authority to award
all remedies  which would be available in a judicial  forum.  The parties  shall
<PAGE>

share the filing fees  required for the  arbitration,  provided  that  Executive
shall not be required to pay an amount in excess of the filing fees  required by
a federal or state court with subject matter jurisdiction. The Company shall pay
the arbitrator's fees and any AAA administrative expenses. Any judgment upon the
award  rendered  by  the  arbitrator(s)  may be  entered  in  any  court  having
jurisdiction  thereof.   However,   notwithstanding  anything  to  the  contrary
contained  herein,  the  Company  shall  have  the  right  to  seek  and  obtain
preliminary   injunctive  relief  and  other  provisional  remedies  in  aid  of
arbitration or to preserve the status quo pending  arbitration in an appropriate
judicial  forum.  BY AGREEING TO THIS BINDING  ARBITRATION  PROVISION,  BOTH THE
EXECUTIVE AND THE COMPANY GIVE UP ALL RIGHTS TO TRIAL BY JURY. This  arbitration
agreement is to be construed as broadly as is permissible under applicable law.

            (c) Notices. All notices and other communications hereunder shall be
in  writing  and  shall be  given  by hand  delivery  to the  other  party or by
registered  or  certified  mail,  return  receipt  requested,  postage  prepaid,
addressed as follows:

      If to the Executive: at the Executive's most recent address on the records
      of the Company;

      If to the Company:
      ------------------
      Clearfield, Inc.
      5480 Nathan Lane N., Suite 120
      Plymouth, MN 55442
      Attn: Chairman

or to such other  address as either  party shall have  furnished to the other in
writing in accordance  herewith.  Notice and  communications  shall be effective
when actually received by the addressee.

            (d) Sarbanes-Oxley Act of 2002.  Notwithstanding  anything herein to
the contrary,  if the Company determines,  in its good faith judgment,  that any
transfer or deemed  transfer of funds  hereunder  is likely to be construed as a
personal loan  prohibited by Section 13(k) of the Exchange Act and the rules and
regulations promulgated thereunder,  then such transfer or deemed transfer shall
not be made to the extent  necessary  or  appropriate  so as not to violate  the
Exchange Act and the rules and regulations promulgated thereunder.

            (e) Section 409A. To the extent applicable,  it is intended that the
compensation  arrangements  under this Agreement be in full  compliance with the
provisions  of Section  409A of the  Internal  Revenue Code and the guidance and
regulations  promulgated  thereunder  ("Section 409A").  This Agreement shall be
administered in a manner  consistent  with this intent and the Executive  agrees
the Company  shall have the right to delay the payment,  or to limit the form of
payment,  of any amount under this Agreement to the extent the Company,  in good
faith,  determines  that such delay or  limitation is necessary to avoid adverse
tax consequences under Section 409A.  Specifically,  notwithstanding anything in
Sections 4 or 5 or any other provision of this Agreement to the contrary,  if at
the  Executive's  Date  of  Termination,  stock  of  the  Company  or any of its
affiliates is publicly traded on an established  securities  market or otherwise
and the Executive is a "Specified  Employee" (as defined in Section 12(e)(i)) at
the Date of Termination,  the Company shall defer the payment or commencement of
the  payment,  as the case may be, of any amounts  described in Sections 4 or 5,
and any other payments or benefits payable under this Agreement, the deferral of
the payment or  commencement of which is necessary to prevent any accelerated or
additional  tax under Section 409A,  that,  in any such case,  otherwise  become
payable  during  the  first  six  months   following  the  Executive's  Date  of
Termination,  until  the  earlier  of (A) the  first  day of the  seventh  month
<PAGE>

following the Executive's Date of Termination, or (B) the Executive's death. Any
payments  or benefits  delayed as a result of the  preceding  sentence  shall be
accumulated  and paid in a lump sum,  without  interest,  as soon as practicable
after the first day of the  seventh  month  following  the  Executive's  Date of
Termination  (or the  Executive's  earlier  death).  Thereafter,  payments shall
resume in  accordance  with this  Agreement.  In  addition,  to the  extent  any
provision of this Agreement,  including the foregoing provisions of this Section
12(e),  is or will be in  violation of Section  409A,  this  Agreement  shall be
amended in such manner as the parties  may agree such that the  Agreement  is or
remains in compliance with Section 409A and the foregoing  intent of the parties
is maintained to the maximum  extent  possible.  Each party is  responsible  for
reviewing this Agreement for compliance with Section 409A.

                    (i) For purposes of this Agreement,  a "Specified  Employee"
means,  during the 12-month  period  beginning on April 1, 2007 or on April 1 of
any  subsequent  calendar year, an employee of the Company or its affiliates who
met the requirements of Section  416(i)(1)(A)(i),  (ii) or (iii) of the Internal
Revenue Code (applied in accordance with the regulations  thereunder and without
regard to Code Section  416(i)(5)) for being a "key employee" at any time during
the 12-month period ending on the December 31st immediately preceding such April
1st.

            (f)  Severability.   The  invalidity  or   unenforceability  of  any
provision of this Agreement shall not affect the validity or  enforceability  of
any other provision of this Agreement. In the event any provision or term hereof
is deemed to have exceeded  applicable  legal  authority or shall be in conflict
with  applicable  legal  limitations,  such  provision  shall  be  reformed  and
rewritten  as  necessary  to  achieve   consistency  and  compliance  with  such
applicable law.

            (g)  Withholding.  The Company may withhold from any amounts payable
under this  Agreement  such federal,  state,  local or foreign taxes as shall be
required  to be  withheld  pursuant  to any  applicable  law or  regulation.  In
addition,  notwithstanding  any other provision of this  Agreement,  the Company
may,  in its sole  discretion,  withhold  and pay over to the  Internal  Revenue
Service  or any  other  applicable  taxing  authority,  for the  benefit  of the
Executive,  all or any  portion of any Excise Tax  Gross-Up  Payment (as defined
under the Company's  Excise Tax Gross-Up Payment Plan), and the Executive hereby
consents to such withholding.

            (h) No Waiver.  The  Executive's or the Company's  failure to insist
upon strict  compliance  with any provision of this  Agreement or the failure to
assert any right the  Executive  or the Company may have  hereunder,  including,
without limitation,  the right of the Executive to terminate employment for Good
Reason pursuant to Section 3(c) of this  Agreement,  shall not be deemed to be a
waiver  of such  provision  or right  or any  other  provision  or right of this
Agreement.

            (i) Entire Agreement.  This Agreement and the agreements,  policies,
plans  and  programs  identified  herein  constitute  the  final,  complete  and
exclusive  agreement  between the  Executive and the Company with respect to the
subject  matter hereof and replace and  supersede any and all other  agreements,
offers or  promises,  whether  oral or  written,  made to the  Executive  by the
Company or any  affiliate or  representative  thereof.  For purposes of removing
ambiguity  and not in  limitation  of the  foregoing,  Executive and the Company
specifically  agree that the prior Change of Control  Agreement  between them is
superseded by this Agreement and is accordingly null and void.
<PAGE>

            (j) Consultation With Counsel.  The  Executive  acknowledges that he
has had a full and  complete  opportunity  to  consult  with  counsel  and other
advisors  of  his  own  choosing   concerning  the  terms,   enforceability  and
implications  of  this  Agreement,  and  that  the  Company  has  not  made  any
representations   or  warranties  to  the   Executive   concerning   the  terms,
enforceability or implications of this Agreement other than as reflected in this
Agreement.

            (k) Representation by Executive.  The Executive  represents that  he
is not subject to any agreement,  instrument,  order, judgment or decree, or any
other  form of  obligation,  that  would  prevent  him from  entering  into this
Agreement or that would be breached  upon  performance  of his duties under this
Agreement.  Executive  will defend and indemnify the Company with respect to any
claims, demands or causes of action which assert that this representation is not
true and correct.

            (l) Counterparts.  This Agreement may be executed  simultaneously in
two  counterparts,  each of which shall be deemed an original but which together
shall constitute one and the same instrument.

      IN WITNESS  WHEREOF,  the Executive has hereunto set the Executive's  hand
and, pursuant to the authorization from the Board of Directors,  the Company has
caused  these  presents to be executed in its name on its behalf,  all as of the
day and year first above written.

                                                CLEARFIELD, INC.

                                                By:     /s/ Cheri B. Podzimek
                                                        ---------------------
                                                        Cheri B. Podzimek

                                                Its:    CEO & President
                                                        ---------------------

                                                By:
                                                        ---------------------
                                                Its:
                                                        ---------------------

                                                EXECUTIVE

                                                /s/ Johnny Hill
                                                ---------------------
                                                Johnny HillExhibit 10.1
    

    

    

    
      EXHIBIT A
    

    
      

      PROMISSORY NOTE (Modified December
      21, 2008)
    

    
      FOR VALUE RECEIVED, Bio-Matrix Scientific
      Group, Inc. hereby promises to pay to the order of Bombardier Pacific
      Ventures Inc.,   the sum of one thousand dollars ($1,000)  principal,
      together with simple interest thereon at the rate of 10 %  per
      annum.  Said sum shall be paid in the manner following:  
    

    
      Principal and all accrued interest from
      September 29, 2008 shall be paid on November 29, 2009
    

    
      This Note shall at the option of the
      holder hereof be immediately due and payable upon the filing by the
      undersigned of an assignment for the benefit of creditors, bankruptcy,
      or for relief under any provisions of the Bankruptcy Code; or by
      suffering an involuntary petition in bankruptcy or receivership not
      vacated within thirty days.
    

    
      In the event this Note shall be in
      default, and placed with an attorney for collection, then the
      undersigned agree to pay all  reasonable attorney fees and costs of
      collection.
    

    
      Payments not made within thirty days of
      due date shall be subject to a late charge of 10% of said payment per
      month for each month past the due date.  All payments hereunder shall be
      made to such  address as may from time to time be designated by any
      holder hereof.
    

    
      IN WITNESS WHEREOF, this Agreement has
      been executed by each of the parties hereto on the date first above
      written.
    

    

    

    
    	
          PURCHASER
        	
           
        	
          SELLER
        
	

        	

        	

        	

        	
           
        
	

        	

        	

        	

        	
           
        
	
          By:
        	
          
            /s/ David R. Koos
          

        	

        	
          By:
        	
          /s/ David R. Koos
        
	

        	

        	

        	

        	
           
        
	

        	

        	

        	

        	
           
        
	
          David R. Koos, Chairman & CEO

          
            Bio-Matrix Scientific Group Inc.
          

        	

        	
          David R. Koos, Chairman & CEO

          
            Bombardier Pacific Ventures Inc.

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