Document:

Exhibit
      10.14

     

    ESCROW
      AGREEMENT

     

    THIS
      ESCROW AGREEMENT (this “Agreement”)
      is
      made as of September __, 2006, by and among CyberDefender Corporation, a
      corporation incorporated under the laws of California (the “Company”),
      the
      purchasers signatory hereto (each a “Purchaser”
and
      together the “Purchasers”),
      and
      Richardson & Patel LLP, with an address at 405 Lexington Avenue,
      26th
      Floor,
      New York, New York 10174 (the “Escrow
      Agent”).
      Capitalized
      terms used but not defined herein shall have the meanings set forth in the
      Securities Purchase Agreement referred to in the first
      recital.

     

    WITNESSETH:

     

    WHEREAS,
      the Purchasers will be purchasing from the Company 10% Secured Convertible
      Debentures (the “Debentures”)
      and
      Warrants as set forth in the Securities Purchase Agreement dated the date hereof
      among the Purchasers and the Company (the “Purchase
      Agreement”),
      which
      will be issued as per the terms contained herein and in the Purchase Agreement;
      and

     

    WHEREAS,
      it is intended that the purchase and sale of the Debentures and Warrants be
      consummated in accordance with the requirements set forth by Section 4(2) of
      or
      Regulation D promulgated under the Securities Act of 1933, as amended;
      and

     

    WHEREAS,
      the Company and the Purchasers have requested that the Escrow Agent hold the
      Subscription Amounts with respect to the Closing in escrow until the Escrow
      Agent has received the Release Notice in the form attached hereto from the
      Company and each Purchaser;

     

    NOW,
      THEREFORE, in consideration of the covenants and mutual promises contained
      herein and other good and valuable consideration, the receipt and legal
      sufficiency of which are hereby acknowledged and intending to be legally bound
      hereby, the parties agree as follows:

     

    ARTICLE
      1

    TERMS
      OF
      THE ESCROW

     

    1.1. 
      The
      parties hereby agree to establish an escrow account with the Escrow Agent
      whereby the Escrow Agent shall hold the funds for the purchase of the Debentures
      and the Warrants as contemplated by the Purchase Agreement.

     

    1.2.  Closing.

     

    (a) Upon
      the
      Escrow Agent’s receipt of the Subscription Amounts into its escrow account,
      together with the Purchasers’ executed counterparts of this Agreement, the
      Purchase Agreement, the Registration Rights Agreement and the Security
      Agreement, it shall telephonically advise the Company of the amount of funds
      it
      has received into its escrow account.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

       

    

    (b) Wire
      transfers to the Escrow Agent shall be made in accordance with the instructions
      set forth on Annex A of the Purchase Agreement.

     

    (c) 
      The
      Company, upon receipt of said notice, shall deliver to the Escrow Agent the
      certificates representing the Debentures and the Warrants to be issued to each
      Purchaser at the Closing together with:

     

    
      	 	
              (i)

            	
              the
                executed counterpart of the Registration Rights
                Agreement;

            

    

     

    
      	 	
              (ii)

            	
              the
                executed counterpart of the Security
                Agreement;

            

    

     

    
      	 	
              (iii)

            	
              the
                executed counterpart of the Note Conversion and Warrant Lock-Up
                Agreement;

            

    

     

    
      	 	
              (iv)

            	
              the
                executed counterpart of the lock-up agreement attached as Exhibit
                G to the
                Purchase Agreement;

            

    

    

    
      	 	
              (v)

            	
              the
                executed counterpart of the Purchase Agreement;

            

    

    

    
      	 	
              (vi)

            	
              a
                Unit Purchase Option Agreement in form and substance reasonably
                satisfactory to the Company and Oceana Parnters LLC (“Oceana”) entitling
                Oceana to purchase units of the Company at an exercise price of $1.00
                per
                unit, with each unit consisting of one share of Common Stock and
                a warrant
                to purchase one share of Common Stock for $1.00 per share, provided
                that
                the aggregate exercise price of the units purchased by Oceana shall
                not
                exceed 7% of the total of all Subscription Amounts;
                and

            

    

    

    
      	 	
              (vii)

            	
              the
                executed counterpart of this
                Agreement.

            

    

    

    (d) In
      the
      event that the foregoing items are not in the Escrow Agent’s possession within
      five (5) Trading Days of the Escrow Agent receiving the Subscription Amounts,
      then each Purchaser shall have the right to demand the return of such
      Purchaser’s Subscription Amount.

     

    (e) Once
      the
      Escrow Agent receives a notice in the form attached hereto as Exhibit
      X
      (the
“Release
      Notice”)
      executed by the Company and each Purchaser, it shall wire 93% of the aggregate
      of all Subscription Amounts per the written instructions of the Company, net
      of
      legal fees payable to the Escrow Agent and the amount withheld by the Purchasers
      pursuant to Section 5.2 of the Purchase Agreement, and the remaining 7% per
      the
      written instruction of Oceana Partners LLC as its fee in connection with the
      transaction described herein.

     

    (f) Once
      the
      funds (as set forth above) have been sent per the Company’s instructions, the
      Escrow Agent shall then arrange to have the executed Transaction Documents
      delivered to the appropriate parties.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      2

    MISCELLANEOUS

     

    2.1. 
      No
      waiver or any breach of any covenant or provision herein contained shall be
      deemed a waiver of any preceding or succeeding breach thereof, or of any other
      covenant or provision herein contained. No extension of time for performance
      of
      any obligation or act shall be deemed an extension of the time for performance
      of any other obligation or act.

     

    2.2. 
      All
      notices or other communications required or permitted hereunder shall be in
      writing, and shall be sent as set forth in the Purchase Agreement.

     

    2.3. 
      This
      Agreement shall be binding upon and shall inure to the benefit of the permitted
      successors and permitted assigns of the parties hereto.

     

    2.4. 
      This
      Agreement is the final expression of, and contains the entire agreement between,
      the parties with respect to the subject matter hereof and supersedes all prior
      understandings with respect thereto. This Agreement may not be modified,
      changed, supplemented or terminated, nor may any obligations hereunder be
      waived, except by written instrument signed by the parties to be charged or
      by
      its agent duly authorized in writing or as otherwise expressly permitted
      herein.

     

    2.5. 
      Whenever
      required by the context of this Agreement, the singular shall include the plural
      and masculine shall include the feminine. This Agreement shall not be construed
      as if it had been prepared by one of the parties, but rather as if all parties
      had prepared the same. Unless otherwise indicated, all references to Articles
      or
      Sections are to this Agreement.

     

    2.6. 
      The
      parties hereto expressly agree that this Agreement shall be governed by,
      interpreted under and construed and enforced in accordance with the laws of
      the
      State of New York. Any action to enforce, arising out of, or relating in any way
      to, any provisions of this Agreement shall only be brought in a state or Federal
      court sitting in the Borough of Manhattan, City of New York, State of New
      York.

     

    2.7. 
      The
      Escrow Agent’s duties hereunder may be altered, amended, modified or revoked
      only by a writing signed by the Company, each Purchaser and the Escrow
      Agent.

     

    2.8. 
      The
      Escrow Agent shall be obligated only for the performance of such duties as
      are
      specifically set forth herein and may rely and shall be protected in relying
      or
      refraining from acting on any instrument reasonably believed by the Escrow
      Agent
      to be genuine and to have been signed or presented by the proper party or
      parties. The Escrow Agent shall not be personally liable for any act the Escrow
      Agent may do or omit to do hereunder as the Escrow Agent while acting in good
      faith, and any act done or omitted by the Escrow Agent pursuant to the advice
      of
      the Escrow Agent’s attorneys-at-law shall be conclusive evidence of such good
      faith.

     

    2.9. 
      The
      Escrow Agent is hereby expressly authorized to disregard any and all warnings
      given by any of the parties hereto or by any other person or corporation,
      excepting only orders or process of courts of law and is hereby expressly
      authorized to comply with and obey orders, judgments or decrees of any court.
      In
      case the Escrow Agent obeys or complies with any such order, judgment or decree,
      the Escrow Agent shall not be liable to any of the parties hereto or to any
      other person, firm or corporation by reason of such decree being subsequently
      reversed, modified, annulled, set aside, vacated or found to have been entered
      without jurisdiction.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    2.10. The
      Escrow Agent shall not be liable in any respect on account of the identity,
      authorization or rights of the parties executing or delivering or purporting
      to
      execute or deliver the Purchase Agreement or any documents or papers deposited
      or called for thereunder.

     

    2.11. The
      Escrow Agent shall be entitled to employ such legal counsel and other experts
      as
      the Escrow Agent may deem necessary to properly to advise the Escrow Agent
      in
      connection with the Escrow Agent’s duties hereunder, may rely upon the advice of
      such counsel, and may pay such counsel reasonable compensation therefor which
      shall be paid by the Company unless otherwise provided for in Section 2.15.
      The
      Escrow Agent has acted as legal counsel for the Company, and may continue to
      act
      as legal counsel for the Company from time to time, notwithstanding its duties
      as the Escrow Agent hereunder. The Company and the Purchasers consent to the
      Escrow Agent in such capacity as legal counsel for the Company and waive any
      claim that such representation represents a conflict of interest on the part
      of
      the Escrow Agent. The Company and the Purchasers understand that the Company
      and
      the Escrow Agent are relying explicitly on the foregoing provision in entering
      into this Escrow Agreement.

     

    2.12. The
      Escrow Agent’s responsibilities as escrow agent hereunder shall terminate if the
      Escrow Agent shall resign by written notice to the Company and the Purchasers.
      In the event of any such resignation, the Purchasers and the Company shall
      appoint a successor Escrow Agent.

     

    2.13. If
      the
      Escrow Agent reasonably requires other or further instruments in connection
      with
      this Escrow Agreement or obligations in respect hereto, the necessary parties
      hereto shall join in furnishing such instruments.

     

    2.14. It
      is
      understood and agreed that should any dispute arise with respect to the delivery
      and/or ownership or right of possession of the documents or the escrow funds
      held by the Escrow Agent hereunder, the Escrow Agent is authorized and directed
      in the Escrow Agent’s sole discretion (1) to retain in the Escrow Agent’s
      possession without liability to anyone all or any part of said documents or
      the
      escrow funds until such disputes shall have been settled either by mutual
      written agreement of the parties concerned by a final order, decree or judgment
      or a court of competent jurisdiction after the time for appeal has expired
      and
      no appeal has been perfected, but the Escrow Agent shall be under no duty
      whatsoever to institute or defend any such proceedings or (2) to deliver the
      escrow funds and any other property and documents held by the Escrow Agent
      hereunder to a state or Federal court having competent subject matter
      jurisdiction and located in the City of New York in accordance with the
      applicable procedure therefor.

     

    2.15. The
      Company and each Purchaser agree jointly and severally to indemnify and hold
      harmless the Escrow Agent and its partners, employees, agents and
      representatives from any and all claims, liabilities, costs or expenses in
      any
      way arising from or relating to the duties or performance of the Escrow Agent
      hereunder or the transactions contemplated hereby or by the Purchase Agreement
      other than any such claim, liability, cost or expense to the extent the same
      shall have been determined by final, unappealable judgment of a court of
      competent jurisdiction to have resulted from the gross negligence or willful
      misconduct of the Escrow Agent.

     

    [SIGNATURE
      PAGES FOLLOW]

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    [SIGNATURE
      PAGE TO ESCROW AGREEMENT]

     

    IN
      WITNESS WHEREOF, the parties hereto have executed this Agreement as of this
      __
      day of September, 2006.

     

    
      	 	 	 
	 	CYBERDEFENDER
              CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name:
              Riggs Eckelberry
	 	Title:
              President

    

     

    
      	 	 	 
	 	RICHARDSON
              & PATEL LLP
	 
 	 
 	 
 
	 	By:  	
            
	 	
              
Name:
              Kevin Friedmann
	 	Title:
              Partner

    

     

    [PURCHASER
      SIGNATURE PAGES FOLLOW]

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    [PURCHASER
      SIGNATURE PAGE TO ESCROW AGREEMENT]

     

    
      	 	 	 
	 	
              
                

              

               

               

            
	 	By:  	 
	 	
              
Name:
	 	Title:

    

    
    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    Exhibit
      X to

    Escrow
      Agreement

     

    RELEASE
      NOTICE

     

    The
      UNDERSIGNED, pursuant to the Escrow Agreement, dated as of September __, 2006
      among CyberDefender Corporation, the Purchasers signatory thereto and Richardson
      & Patel LLP, as Escrow Agent (the “Escrow
      Agreement”;
      capitalized terms used herein and not defined shall have the meaning ascribed
      to
      such terms in the Escrow Agreement), hereby notify the Escrow Agent that each
      of
      the conditions precedent to the purchase and sale of the Debentures set forth
      in
      the Purchase Agreement have been satisfied. The Company and the undersigned
      Purchaser hereby confirm that all of their respective representations and
      warranties contained in the Purchase Agreement remain true and correct and
      authorize the release by the Escrow Agent of the funds and documents to be
      released at the Closing as described in the Escrow Agreement. This Release
      Notice shall not be effective until executed by the Company and the Purchaser
      set forth below. 

     

    This
      Release Notice may be signed in one or more counterparts, each of which shall
      be
      deemed an original.

     

    IN
      WITNESS WHEREOF, the undersigned have caused this Release Notice to be duly
      executed and delivered as of this __ day of September, 2006.

     

    
      	 	 	 
	 	CYBERDEFENDER
              CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name:
              Gary Guseinov
	 	Title:
              Chief Executive Officer

    

     

    [PURCHASER
      SIGNATURE PAGES FOLLOW]

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    [PURCHASER
      SIGNATURE PAGE TO RELEASE NOTICE OF ESCROW AGREEMENT]

    
      	 	 	
               

            
	 	
              PURCHASER:

               

            
	 	
              
                

              

               

               

            
	 	By:  	 
	 	
              
Name:
	 	Title:

    

     

    
      
        
        

      

      
        8Exhibit
        10.15

      

      FORM
        OF
        LOCK-UP AGREEMENT

      

      September
        __, 2006

      

      Purchasers
        referred to below:

      

      
        	 	
                Re:

              	
                Securities
                  Purchase Agreement, dated as of September __, 2006 (the “Purchase
                  Agreement”),
                  between CyberDefender Corporation, (the “Company”)
                  and the purchasers signatory thereto (each, a “Purchaser”
                  and, collectively, the “Purchasers”)

              

      

       

      Ladies
        and Gentlemen:

       

      Defined
        terms not otherwise defined in this letter agreement (the “Letter
        Agreement”)
        shall
        have the meanings set forth in the Purchase Agreement. Pursuant to Section
        2.2(a)(v) of the Purchase Agreement and in satisfaction of a condition of
        the
        Company’s obligations under the Purchase Agreement, the undersigned irrevocably
        agrees with the Company that, from the date hereof until the six month
        anniversary of the Effective Date (such period, the “Restriction
        Period”),
        the
        undersigned shall not offer, sell, contract to sell, hypothecate, pledge
        or
        otherwise dispose of (or enter into any transaction which is designed to,
        or
        might reasonably be expected to, result in the disposition (whether by actual
        disposition or effective economic disposition due to cash settlement or
        otherwise) by the undersigned or any Affiliate of the undersigned or any
        person
        in privity with the undersigned or any Affiliate of the undersigned), directly
        or indirectly, including the filing (or participation in the filing) of a
        registration statement with the Commission in respect of, or establish or
        increase a put equivalent position or liquidate or decrease a call equivalent
        position within the meaning of Section 16 of the Exchange Act with respect
        to,
        any shares of Common Stock or Common Stock Equivalents beneficially owned,
        held
        or hereafter acquired by the undersigned [AS
        TO THE EARLIER BRIDGE NOTE HOLDERS]
        which
        are derived, directly or indirectly, from the Earlier Bridge Notes (but not
        from
        the warrants issued in connection therwith]] (the “Securities”).
        Beneficial
        ownership shall be calculated in accordance with Section 13(d) of the Exchange
        Act. In order to enforce this covenant, the Company shall impose irrevocable
        stop-transfer instructions preventing the Transfer Agent from effecting any
        actions in violation of this Letter Agreement.

      

      [AS
        TO GUSEINOV AND LIU -
        In
        addition, during the period from the first calendar day following the
        Restriction Period to and including December 31, 2008, during each 90
        consecutive day period therein, the undersigned shall offer, sell, contract
        to
        sell, hypothecate, pledge or otherwise dispose of, directly or indirectly,
        no
        more than __%1   2.5%
        as to Gary Guseinov and 10% as to Bing Liu
        of the
        Securities owned by the undersigned in such 90 consecutive day period (which
        amount shall be adjusted downward pro-rata on a daily basis if the last such
        period ends after December 31, 2008).] [AS
        TO THE
        EARLIER BRIDGE NOTE HOLDERS
        - In
        addition, during each of the four 90 consecutive day periods immediately
        following the Restriction Period, the undersigned shall offer, sell, contract
        to
        sell, hypothecate, pledge or otherwise dispose of, directly or indirectly,
        no
        more than 10% of the Securities owned by the undersigned in any such 90
        consecutive day period and during the fifth 90 consecutive day period
        immediately following the Restriction Period, the undersigned shall offer,
        sell,
        contract to sell, hypothecate, pledge or otherwise dispose of, directly or
        indirectly, no more than 15% of the Securities owned by the undersigned in
        such
        fifth 90 consecutive day period and during the sixth 90 consecutive day period
        immediately following the Restriction Period, the undersigned shall offer,
        sell,
        contract to sell, hypothecate, pledge or otherwise dispose of, directly or
        indirectly, no more than 20% of the Securities owned by the undersigned in
        such
        sixth 90 consecutive day period.] The undersigned’s rights to offer, sell,
        contract to sell, hypothecate, pledge or otherwise dispose of, directly or
        indirectly, Securities in any given 90 consecutive day period shall not be
        cumulated with such rights in any other 90 consecutive day period if such
        rights
        are unused in the prior 90 consecutive day period. In order to enforce this
        covenant, the Company shall deliver, prior to the first calendar day following
        the Restriction Period, irrevocable limited-transfer instructions preventing
        the
        Transfer Agent from effecting any actions in violation of this paragraph
        of the
        Letter Agreement.      

      
        

          
            
              
                

              

              	1	
                      2.5%
                        as to Gary Guseinov and 10% as to Bing
                        Liu

                    

            

             

          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      Notwithstanding
        the foregoing, the undersigned may transfer Securities (i) as a bona fide
        gift
        or gifts, provided that the donee or donees thereof agree to be bound by
        the
        restrictions set forth herein, (ii) to any trust for the direct or indirect
        benefit of the undersigned or the immediate family of the undersigned, provided
        that the trustee of the trust agrees to be bound by the restrictions set
        forth
        herein, and provided further that any such transfer shall not involve a
        disposition for value, or (iii) in transactions relating to shares of Common
        Stock acquired by the undersigned in open market transactions after the
        completion of the transactions contemplated by the Purchase Agreement. For
        purposes of this Agreement, “immediate family” shall mean any relationship by
        blood, marriage or adoption, not more remote than first cousin. 

       

      The
        undersigned acknowledges that the execution, delivery and performance of
        this
        Letter Agreement is a material inducement to each Purchaser to complete the
        transactions contemplated by the Purchase Agreement and that each Purchaser
        (which shall be a third party beneficiary of this Letter Agreement) and the
        Company shall be entitled to specific performance of the undersigned’s
        obligations hereunder. The undersigned hereby represents that the undersigned
        has the power and authority to execute, deliver and perform this Letter
        Agreement, that the undersigned has received adequate consideration therefor,
        and that the undersigned will indirectly benefit from the closing of the
        transactions contemplated by the Purchase Agreement. 

       

      This
        Letter Agreement may not be amended or otherwise modified in any respect
        without
        the written consent of each of the Company, each Purchaser and the undersigned.
        This Letter Agreement shall be construed and enforced in accordance with
        the
        laws of the State of New York without regard to the principles of conflict
        of
        laws. The undersigned hereby
        irrevocably submits to the exclusive jurisdiction of the United States District
        Court sitting in the Southern District of New York and the courts of the
        State
        of New York located in Manhattan, for the purposes of any suit, action or
        proceeding arising out of or relating to this Letter Agreement and hereby
        waives, and agrees not to assert in any such suit, action or proceeding,
        any
        claim that (i) it is not personally subject to the jurisdiction of such court,
        (ii) the suit, action or proceeding is brought in an inconvenient forum or
        (iii)
        the venue of the suit, action or proceeding is improper.
        The
        undersigned hereby irrevocably waives personal service of process and consents
        to process being served in any such suit, action or proceeding by receiving
        a
        copy thereof sent to the Company at the address in effect for notices to
        it
        under the Purchase Agreement and agrees that such service shall constitute
        good
        and sufficient service of process and notice thereof. The undersigned hereby
        waives any right to a trial by jury. Nothing contained herein shall be deemed
        to
        limit in any way any right to serve process in any manner permitted by law.
        The
        undersigned agrees and understands that this Letter Agreement does not intend
        to
        create any relationship between the undersigned and each Purchaser and that
        each
        Purchaser is not entitled to cast any votes on the matters herein contemplated
        and that no issuance or sale of the Securities is created or intended by
        virtue
        of this Letter Agreement.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      By
        its
        signature below, the Company’s Transfer Agent hereby acknowledges and agrees
        that, reflecting this Letter Agreement, it has placed an irrevocable stop
        transfer instruction on all Securities beneficially owned by the undersigned
        until the end of the Restriction Period. This Letter Agreement shall be binding
        on successors and assigns of the undersigned with respect to the Securities
        and
        any such successor or assign shall enter into a similar agreement for the
        benefit of the Purchasers.

       

      ***
        SIGNATURE PAGE FOLLOWS***

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

      This
        Letter Agreement may be executed in two or more counterparts, all of which
        when
        taken together may be considered one and the same agreement.

       

       

      _________________________

      Signature

       

      __________________________

      Print
        Name

       

      __________________________

      Position
        in Company

      

      Address
        for Notice:

      

      
        __________________________

      

      

      
        __________________________

      

      
         

        __________________________

      

      Number
        of
        shares of Common Stock

      

      _____________________________________________________________________________

      Number
        of
        shares of Common Stock underlying subject to warrants, options, debentures
        or
        other convertible securities

       

      By
        signing below, the Company agrees to enforce the restrictions on transfer
        set
        forth in this Letter Agreement.

      

      CyberDefender
        Corporation 

        

      
        	 	 	 	 
	By:	 	 	 
	
                
                  

                

                Name:

                
                  

                

                
                  
                    Title:

                  

                

              	 	 	
              
	
                
                  

                

              	 	 	 

      

       

      Acknowledged
        and agreed to

      as
        of the
        date set forth above:

      

      [insert
        name of transfer agent]

           

      
        	 	 	 	 
	By:
	 	 	 
	
                
                  
Name:

              	 	 	
              
	
                Title:

              	 	 	 

     

      
        
          
          

        

        
          4

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