Document:

Exhibit 4.1 - Specimen Stock Certificate.

Exhibit 4.1

 

	 	 	 
	
Number
	 	
Shares

	 	
BELVEDERE RESOURCES CORPORATION
	 
	 	
INCORPORATED UNDER THE LAWS OF THE STATE OF
	 
	 	
NEVADA 200,000,000 SHARES COMMON STOCK AUTHORIZED,
	 
	 	
$0.00001 PAR VALUE
	 
	 	 	 
	 	 	
CUSIP_______

	 	 	
SEE REVERSE

	 	 	
FOR

	
This
	 	
CERTAIN

	
certifies
	 	
DEFINITIONS

	
that
	 	 
	
is the owner of
	 	 
	 	 	 
	 	 	 
	 	
FULLY PAID AND NON-ASSESSABLE
	 
	 	
SHARES OF COMMON STOCK OF
	 
	 	 	 
	 	 	 
	 	
BELVEDERE RESOURCES CORPORATION
	 
	 	
transferable on the books of the corporation in person or by duly
	 
	 	
authorized attorney upon surrender of this certificate properly
	 
	 	
endorsed.  This certificate and the shares represented hereby
	 
	 	
are subject to the laws of the State of Nevada, and to the
	 
	 	
Articles of Incorporation and Bylaws of the Corporation,
	 
	 	
as now or hereafter amended.  This certificate is not valid
	 
	 	
unless countersigned by the Transfer Agent.  WITNESS
	 
	 	
the facsimile seal of the Corporation and the signature
	 
	 	
of its duly authorized officers
	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
PRESIDENT
	
[SEAL]
	
SECRETARY

 

 

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations.

	
TEN COM
	
as tenants in common
	
UNIF GIFT MIN ACT
	
____________
	
Custodian
	
____________

	
TEN ENT
	
as tenants by the entireties
	 	
(Cust)
	 	
(Minor)

	
JT TEN
	
as joint tenants with the right of
	
Act
	
_________________________________

	 	
survivorship and not as tenants
	 	
(State)

	 	
in common
	 	 

Additional abbreviations may also be used though not in the above list.

	
For value received, ______________________________________ hereby sell, assign and transfer unto

	 	
PLEASE INSERT SOCIAL SECURITY OR OTHER
	 
	 	
IDENTIFYING NUMBER OF ASSIGNEE
	 
	 
	
_____________________________________________________________________________________

	
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE OF ASSIGNEE)

	 
	
_____________________________________________________________________________________

	 
	
_____________________________________________________________________________________

	 
	
_____________________________________________________________________________________

	 
	
_____________________________________________________________________________ shares of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint

	 
	
_____________________________________________________________________________, Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.

	 
	
Dated _______________________

	 
	
X ________________________________________________________________________________

	
THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER.  THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (Banks, Stockbrokers, Savings and Loan Associations and Credit Unions)

 

SIGNATURE GUARANTEED:

 

 

TRANSFER FEE WILL APPLYExhibit 10.1

Exhibit 10.1

 

 

 

 

 

November 15, 2006

 

Belvedere Resources Corporation

24442-112th Avenue

Maple Ridge, British Columbia, 

Canada V3E 1H5

Ladies and Gentlemen:

RE: Claims

     Shawn Englemann holds in trust for Belvedere Resources Corporation, a 100% undivided interest in the following claim(s):

	Claim Name  	Tenure Number  	Cells  	Expiration Date  
	Spanish Gold  	536683  	8  	July 6, 2007  

 

     Shawn Englemann will deliver full title on demand to Belvedere Resources Corporation for as long as the claims are in good standing with the Province of British Columbia.

 

		Yours truly,  
		  
		  
		SHAWN ENGLMANN  
		Shawn EnglmannSeverance Agreement

     

    Exhibit
      10.1

     

     

    SEVERANCE
      AGREEMENT

    

    This
      Severance Agreement ("Agreement") is made and entered into by and between
      LANTRONIX, INC., a Delaware corporation ("Company"), and Marc H. Nussbaum
      ("Executive"), and is effective as of May 15, 2007.

    

    RECITALS

    

    WHEREAS,
      Executive is employed as President, Chief Executive Officer of the
      Company;

    

    and

    

    WHEREAS,
      the Company desires to provide certain benefits to Executive as described herein
      as an incentive for Executive to serve the Company.

    

    AGREEMENT

    

    NOW,
      THEREFORE, in consideration of the promises and covenants set forth in this
      Agreement and for other valuable consideration, the parties agree as
      follows:

    

    1. Termination
      Without Cause or Resignation With "Good Reason" During Specified Pre-Change
      Period or Specified Post-Change Period.
      If a
      "Change of Control" (as hereinafter defined) of the Company occurs after the
      effective date hereof, and either (i) the Company terminates Executive without
      "Cause" (as hereinafter defined) during the Specified Post-Change Period or
      the
      Specified Pre-Change Period (each as defined below), or (ii) Executive resigns
      with "Good Reason" (as hereinafter defined) during the Specified Post-Change
      Period or the Specified Pre-Change Period, then, subject to the terms of this
      Agreement, as a severance benefit and in lieu of all other compensation or
      damages, the Company shall:

    

    a. Pay
      Executive a sum equal to the greater of either (i) twenty-four (24) months
      of his base salary in effect on the date of termination or resignation, or
      (ii) twenty-four (24) months of his base salary in effect as of (A) the
      Execution Date (as defined in Paragraph 3(e) below) in the event the Company
      terminates Executive without Cause or Executive resigns with Good Reason, during
      a Specified Pre-Change Period, or (B) the date of the Change of Control in
      the
      event the Company terminates Executive without Cause or Executive resigns with
      Good Reason during a Specified Post-Change Period, payable as follows and less
      required tax deductions and withholdings: (x) one-half of such amount
      within thirty (30) days after the later of (1) the date of the consummation
      of
      the Change of Control, or (2) the date of such termination or resignation,
      and
      (y) one-half of such amount on or before the date that is twelve (12)
      months following the later of (1) the date of the consummation of the Change
      of
      Control, or (2) the date of such termination or resignation. The timing of
      the
      payments shall be made in accordance with the previous sentence if the sum
      of
      the payments to which Executive is entitled under this Paragraph 1(a) do not
      exceed the lesser of two (2) times Executive's annual compensation or two (2)
      times the compensation limit set forth in Section 401(a)(17) of the Internal
      Revenue Code, for the calendar year prior to the calendar year in which
      Executive is terminated or resigns. If the sum of such payments to Executive
      under this Paragraph 1(a) would exceed the lesser of two (2) times Executive's
      annual compensation or two (2) times the compensation limit set forth in Section
      401(a)(17) of the Internal Revenue Code, then such excess amount shall be paid
      to Executive prior to the 15th
      day of
      March following the end of the calendar year in which the Executive was
      terminated without Cause or the Executive resigned with Good
      Reason;

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    b. Continue
      to provide Executive, at the Company's expense, all medical, dental insurance
      coverages and executive automobile benefits provided to him immediately prior
      to
      the date of such termination or resignation for a period of twenty-four (24)
      months following the date of such termination or resignation, or, if any of
      such
      benefits cannot be provided to Executive for such twenty-four (24) month period
      under the Company's policies as then in effect or under applicable law (for
      example, if Executive must elect COBRA continuation coverage to receive such
      benefits), then the Company shall pay Executive an amount equal to the monthly
      sums paid on behalf of Executive for such benefits at the time of such
      termination or resignation for a period beginning on the date Executive's
      participation in such benefits is disallowed and ending on the date that is
      no
      more than twenty-four (24) months following the date of such termination or
      resignation, payable in monthly installments within five business days after
      the
      end of each month. If the Executive is terminated without Cause or resigns
      with
      Good Reason during a Specified Pre-Change Period, then payments to the Executive
      under this Paragraph 1(b) shall not begin until after the consummation of the
      Change of Control associated with such Specified Pre-Change Period and the
      first
      payment made to Executive under this Paragraph 1(b) after the consummation
      of
      such Change of Control shall include amounts described in this Paragraph 1(b)
      for the period between the date of such termination or resignation and the
      consummation of such Change of Control. The Company may elect to make a one-time
      lump-sum payment equivalent to the payment and benefits under this paragraph.
      Such amounts are subject to withholding and/or taxation;

    

    c. Subject
      to the provisions of the Company's stock option plan(s), accelerate the vesting
      of 100% of all unvested stock options granted to Executive under the Company's
      stock option or other benefit plan. Subject to the provisions of the Company's
      stock option plan(s), Executive shall have until the earlier of the following
      three dates to exercise each of Executive's vested options (including options
      accelerated pursuant to the foregoing provisions of this paragraph c.):
      (i) twenty-four (24) months after the date of Executive's termination or
      resignation, (ii) for each option, the latest date on which such option
      could have expired by its original terms under any circumstances, or
      (iii) for each option, ten (10) years after the original grant date of such
      option. Notwithstanding
      the foregoing provisions of this paragraph c., if and to the extent that any
      stock option held by Executive is intended to be an "incentive stock option,"
      within the meaning of Section 422 of the Internal Revenue Code of 1986, as
      amended (the "Code"), the post-termination exercise period of such incentive
      stock option shall not, without the prior written consent of Executive, be
      extended beyond three (3) months following the date of termination or
      resignation (or twelve (12) months following the date of termination or
      resignation if Executive's employment with the Company was terminated, or
      Executive resigned, as a result of Executive becoming disabled (within the
      meaning of Section 22(e)(3) of the Code));
      and

    

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    d. The
      Company shall pay to Executive within 30 days of the later of (1) the date
      of
      the consummation of the Change of Control, or (2) the date of such termination
      or resignation, a lump-sum payment, less required tax deductions and
      withholdings, equal to the larger of either (i) the highest amount of bonus
      incentive cash compensation paid to Executive for services in any past one
      year
      period (if any) or (ii) 100% of the Executive’s Target Bonus (if any) approved
      by the Board of Directors.

    

    2. Termination
      Without Cause Not During Specified Pre-Change Period or Specified Post-Change
      Period.
      If the
      Company terminates Executive without "Cause" other than during a Specified
      Pre-Change Period or a Specified Post-Change Period (each as defined below),
      then, subject to the terms of this Agreement, as a severance benefit and in
      lieu
      of all other compensation or damages, the Company shall:

    

    a. Continue
      to pay Executive his current base salary, less required tax deductions and
      withholdings, as in effect on the date of such termination through the end
      of
      the week in which the applicable termination occurred and continuing for a
      period of eighteen (18) months. The timing of the payments shall be made in
      accordance with the previous sentence if the sum of the payments to which
      Executive is entitled under this Paragraph 2(a) do not exceed the lesser of
      two
      (2) times Executive's annual compensation or two (2) times the compensation
      limit set forth in Section 401(a)(17) of the Internal Revenue Code, for the
      calendar year prior to the calendar year in which Executive is terminated or
      resigns. If the sum of such payments to Executive under this Paragraph 2(a)
      would exceed the lesser of two (2) times Executive's annual compensation or
      two
      (2) times the compensation limit set forth in Section 401(a)(17) of the Internal
      Revenue Code, then such excess amount shall be paid to Executive prior to the
      15th
      day of
      March following the end of the calendar year in which the Executive was
      terminated without Cause;

    

    b. Continue
      to provide Executive, at the Company's expense, all medical, dental insurance
      coverages and executive automobile benefits provided to him immediately prior
      to
      the date of such termination for a period of eighteen (18) months following
      the
      date of such termination, or, if any of such benefits cannot be provided to
      Executive for such eighteen (18) month period under the Company's policies
      as
      then in effect or under applicable law (for example, if Executive must elect
      COBRA continuation coverage to receive such benefits), then the Company shall
      pay Executive an amount equal to the monthly sums paid on behalf of Executive
      for such benefits at the time of such termination for a period beginning on
      the
      date Executive's participation in such benefits is disallowed and ending on
      the
      date that is eighteen (18) months following the date of such termination,
      payable in monthly installments within five business days after the end of
      each
      month. The Company may elect to make a one-time lump-sum payment equivalent
      to
      the payment and benefits under this paragraph. Such sums are subject to
      withholding and/or taxation;

    

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    c. Allow
      Executive to exercise any and all stock options that were granted to Executive
      and vested as of the date of termination. Subject to the provisions of the
      Company's stock option plan(s), Executive shall have until the earlier of the
      following three dates to exercise each of Executive's vested options:
      (i) twenty-four (24) months after the date of Executive's termination,
      (ii) for each option, the latest date on which such option could have
      expired by its original terms under any circumstances, or (iii) for each
      option, ten (10) years after the original grant date of such option.
      Notwithstanding the foregoing provisions of this paragraph c., if and to the
      extent that any stock option held by Executive is intended to be an "incentive
      stock option," within the meaning of Section 422 of the Code, the
      post-termination exercise period of such incentive stock option shall not,
      without Executive's prior written consent, be extended beyond three (3) months
      following the date of termination (or twelve (12) months following the date
      of
      termination if Executive's employment with the Company was terminated as a
      result of Executive becoming disabled (within the meaning of Section 22(e)(3)
      of
      the Code)); and

    

    d. Pay
      to
      Executive a prorated bonus, less applicable tax withholdings and deductions,
      based on the percentage of the current bonus period during which Executive
      was
      included in the bonus plan and the actual bonus pool amount for the position
      granted by the Company’s Board of Directors for the current bonus period,
      payable within five business days such bonuses are calculated and paid
      generally.

    

    3. Definitions.

    

    a. Change
      of Control.
      For
      purposes of this Agreement, the term "Change of Control" means the occurrence
      of
      any of the following events:

     

    (i) Any
      "person" (as such term is used in Sections 13(d) and 14(d) of the Securities
      Exchange Act of 1934, as amended (the "Exchange Act")) becomes the "beneficial
      owner" (as defined in Rule 13d-3 promulgated under the Exchange Act), directly
      or indirectly, of securities of the Company representing fifty percent (50%)
      or
      more of the total voting power represented by the Company's then outstanding
      voting securities; or

     

    (ii) The
      consummation of the sale or disposition by the Company of all or substantially
      all of the Company's assets; or

     

    (iii) The
      consummation of a merger or consolidation of the Company with any other
      corporation, other than a merger or consolidation which would result in the
      voting securities of the Company outstanding immediately prior thereto
      continuing to represent (either by remaining outstanding or by being converted
      into voting securities of the surviving entity or its parent) at least seventy
      percent (70%) of the total voting power represented by the voting securities
      of
      the Company or such surviving entity or its parent outstanding immediately
      after
      such merger or consolidation.

    

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    b. Termination
      without Cause.
      The
      Company in its sole discretion may terminate Executive's employment at will
      at
      any time with or without Cause or notice, and this Agreement does not obligate
      the Company to continue Executive's employment for any specified term, or at
      all. For purposes of this Agreement, the Company shall be deemed to have
      terminated Executive's employment without "Cause" if Executive's employment
      is
      terminated at will, or for any reason other than the following:
      (i) Executive's commission of a felony or misdemeanor or his possession,
      use or sale of a controlled substance (other than the use or possession of
      legally prescribed medication used for their prescribed purpose); (ii)
      Executive's significant neglect, or materially inadequate performance of, his
      duties as an employee of the Company; (iii) Executive's breach of a fiduciary
      duty to the Company or its shareholders; (iv) Executive's willful breach of
      duty
      in the course of his employment; (v) Executive's material violation of the
      Company's personnel or business policies; (vi) Executive's willful
      misconduct; (vii) Executive's death; or (viii) Executive's disability. For
      purposes of this Agreement, Executive shall be considered disabled if Executive
      has been physically or mentally unable to perform his essential job duties
      hereunder for (x) a continuous period of at least one hundred twenty (120)
      days
      or (y) a total of one hundred fifty (150) days during any one hundred and eighty
      (180) day period, and Executive has not recovered and returned to the full
      time
      performance of his duties within thirty (30) days after written notice is given
      to Executive by the Company following such 120 day period or 180 day period,
      as
      the case may be.

    

    c. Resignation
      with Good Reason.
      Executive may resign at any time with or without Good Reason. For purposes
      of
      this Agreement, Executive shall be deemed to have resigned with "Good Reason"
      only if he resigns during a Specified Pre-Change Period or a Specified
      Post-Change Period and such resignation occurs within ninety (90) days (but
      no
      later than the end of the Specified Pre-Change Period if Executive resigns
      with
      Good Reason during a Specified Pre-Change Period) after the Company has taken
      any of the following actions without Executive's express written consent: (i)
      the Company "Substantially Lessens Executive's Title" (as defined on
Exhibit
      "A"
      attached
      hereto); (ii) the Company Substantially Reduces Executive's Senior Authority
      (as
      defined on Exhibit
      "A"
      attached
      hereto); (iii) the Company assigns material duties to Executive which are
      materially inconsistent with Executive's then-current status; (iv) the Company
      reduces Executive's base salary or benefits from that in effect at (A) the
      Execution Date (as defined Paragraph 3(e) below) if the Executive resigns with
      Good Reason during a Specified Pre-Change Period, or (B) the time of the
      consummation of the Change of Control if the Executive resigns during the
      Specified Post-Change Period, (unless, in either case, such reduction is in
      connection with a salary or benefit reduction program of general application
      at
      Executive's level) (v) the Company requires Executive to be based more than
      fifty (50) miles from his present office location, except for required travel
      consistent with Executive's business travel obligations; or (vi) the Company
      fails to obtain the assumption of this Agreement by any successor or assign
      of
      the Company.

    

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    The
      parties acknowledge that, in the event of a Change of Control, it may be
      mutually advantageous for Executive and the Company to discuss and implement
      changes in Executive’s employment on a trial basis even though such employment
      changes may constitute "Good Reason" under the terms of this Agreement.
      Accordingly, the parties may agree to extend the 90-day period referred to
      above
      in this subparagraph (c).

    

    d. The
      executive’s Target Bonus for Fiscal Year 2008 is equal to 100% of Executive’s
      base salary. 

    

    e. Specified
      Pre-Change Period and Specified Post-Change Period.
      For
      purposes of this Agreement, the term "Specified Pre-Change Period" means the
      period beginning on the date a definitive agreement is executed by all parties
      thereto (the "Execution Date") for a transaction that will constitute a Change
      of Control of the Company when consummated, and ending on the date the Change
      of
      Control governed by such definitive agreement is consummated; provided, however,
      that if the Change of Control governed by such definitive agreement is not
      consummated within sixty (60) days after the Execution Date or if such
      definitive agreement is terminated before the Change of Control governed by
      such
      definitive agreement is consummated, there shall be no Specified Pre-Change
      Period with respect to such definitive agreement or the Change of Control
      governed by such definitive agreement. For the avoidance of doubt, the parties
      agree that the determination of whether a Specified Pre-Change Period exists
      cannot be made until it has been determined whether a Change of Control has
      been
      consummated pursuant to the applicable definitive agreement within 60 days
      after
      the Execution Date of such definitive agreement. For purposes of this Agreement,
      the term "Specified Post-Change Period" means the period beginning on the date
      of the consummation of a Change of Control of the Company, and ending on the
      two-year anniversary date of the consummation of such Change of Control.

    

    4. Confidential
      Information; Non-Solicitation of Employees.

    

    a. As
      a
      material inducement and condition to the payment of the above-referenced
      severance monies, Executive acknowledges and agrees that he shall continue
      to be
      bound by and comply with each and every term and condition of the Company's
      Employment, Confidential Information and Invention Assignment Agreement and
      any
      other proprietary or confidentiality agreement(s) between Executive and the
      Company.

    

    b. As
      a
      further material inducement and condition to the payment of the above-referenced
      severance monies, Executive agrees that for a period of one (1) year following
      Executive's date of termination or resignation, he will not, either directly
      or
      indirectly, or either on his own behalf or on behalf of any other person,
      recruit or solicit for hire any individual who is then employed by the
      Company.

    

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    c. Executive
      acknowledges and agrees that the restrictions contained in this Paragraph 4
      are
      reasonable and appropriate. Executive further acknowledges and agrees that
      the
      restrictions contained in this Paragraph 4 will not preclude him from engaging
      in any trade, business or profession that he is qualified to engage
      in.

    

    5. General
      Release of Claims.
      As a
      condition of receiving the above-referenced severance monies, Executive shall
      be
      required to execute a general release of all known and unknown claims in a
      form
      reasonably acceptable to the Company at the time of his termination or
      resignation. This General Release of Claims shall not release Lantronix from
      any
      obligations it may have under its Articles of Incorporation, Bylaws, or
      applicable law, to indemnify Executive for his actions as an employee of
      Lantronix.

    

    6.
       The
      Company's Obligations Under This Agreement.
      Executive shall not be entitled to any of the benefits of Paragraphs 1 and
      2 if
      the Company terminates Executive's employment, or if Executive resigns, under
      circumstances other than as specifically set forth in Paragraphs 1 and 2. The
      benefits set forth in Paragraphs 1 and 2 constitute the sole obligations of
      the
      Company to Executive upon any termination or resignation and are in lieu of
      any
      damages or other compensation that Executive may claim under other Company
      policies or otherwise, except for Executive's base salary which has been earned
      up to the date of termination or resignation, compensation for any accrued
      and
      unused vacation up to the date of termination or resignation, reimbursement
      for
      business expenses incurred up to the date of termination or resignation (in
      accordance with the customary policies of the Company), and any benefits that
      the Company is required to provide to Executive after the date of termination
      or
      resignation under COBRA or pursuant to any ERISA plan(s) of the Company. The
      benefits on termination or resignation provided in this Agreement are in
      substitution for any severance or termination benefits otherwise available
      under
      Company policies of general application. The benefits on termination or
      resignation provided in this Agreement shall not be reduced by any compensation
      or benefits received by Executive from any subsequent employer or any other
      third party.

    

    7. Withholding
      of Taxes; Tax Reporting.
      The
      Company may withhold from any amounts payable under this Agreement all such
      federal, state, city and other taxes, and may file with appropriate governmental
      authorities all such information, returns or other reports with respect to
      the
      tax consequences of any amounts payable under this Agreement, as may, in its
      judgment, be required by law.

    

    8. Sections
      280G, 162(m) and Compliance with Section 409A.
      

     

    a. Notwithstanding
      anything contained in this Agreement to the contrary, any payments to be made
      to
      or for the benefit of Executive, or any vesting of stock options or other
      benefits for the benefit of Executive, which are deemed to be "parachute
      payments" as that term is defined in Section 280G of the Code, may be modified
      or reduced to the extent deemed to be necessary by the Board of Directors of
      the
      Company to avoid the imposition of excise taxes on Executive under Section
      4999
      of the Code or the disallowance of a deduction to the Company under Section
      280G(a) of the Code.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    b. Notwithstanding
      anything in this Agreement to the contrary, if the Board of Directors of the
      Company determines that any acceleration, extension or other modification of
      Executive's stock options pursuant to this Agreement could reasonably be
      expected to cause such options to lose their status as "qualified
      performance-based compensation" under Code Section 162(m) and Treasury
      Regulation Section 1.162-27(e), such accelerations, extensions or other
      modifications may be modified or reduced to the extent deemed necessary by
      the
      Company's Board of Directors to prevent such options from losing their status
      as
      qualified performance-based compensation.

     

    c. In
      the
      event cash payments or vesting, extension or other modifications of stock
      options are reduced pursuant to this Paragraph 8, such reduction shall, to
      the
      extent legally permissible, be made to stock options first and cash payments
      last.

     

    d. This
      Agreement is intended to be exempt to the extent possible from the requirements
      of Internal Revenue Code Section 409A, including current and future
      guidance and regulations interpreting such provisions. To the extent that any
      provision of this Agreement fails to satisfy a requirement for such an
      exemption, the provision shall automatically be modified in a manner that,
      in
      the good-faith opinion of the Company, brings the provisions into compliance
      with such requirement while preserving as closely as possible the original
      intent of the provision and this Agreement. If it is determined by the Company
      that any payment under this Agreement is subject to the requirements of Code
      Section 409A notwithstanding the preceding sentences, then the provisions
      of the Agreement shall be automatically modified in such manner as brings the
      Agreement into compliance with such requirements. In particular, and without
      limiting the preceding sentence, while any stock of the Company is or is treated
      as publicly
      traded and Executive is a “specified employee” under Code
      Section 409A(a)(2)(B)(i), then any payment under this Agreement that is
      treated as deferred compensation under Code Section 409A shall be delayed
      until the date which is six months after the date of separation from service
      (without interest or earnings).

     

    e. The
      costs
      of all legal and accounting fees required to make the Company's determinations
      and estimates for purposes of this Paragraph 8 will be paid for by the Company.
      

     

    9. Assignment.
      Executive may not assign this Agreement. The Company shall be entitled to assign
      this Agreement to any successor in interest to its business. The Company will
      obtain an assumption of this Agreement by any successor or assign to all or
      substantially all of the business and/or assets of the Company (whether direct
      or indirect, by acquisition, merger, consolidation or otherwise), but the
      failure to obtain such assumption shall not prevent or delay such acquisition,
      merger, consolidation or other transaction or relieve the Company of its
      obligations under the Agreement. This Agreement shall bind and inure to the
      benefit of the Company's successors and assigns, as well as Executive's heirs,
      executors, administrators, and legal representatives.

    

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    10. Notices.
      Any
      notice, request, demand or other communication required or permitted hereunder
      shall be deemed to be properly given when personally served or three (3) days
      after deposit in the United States mail, registered or certified, postage
      prepaid, return receipt requested, addressed to the Company at its principal
      office or to Executive at Executive's last known address.

    

    11. Entire
      Agreement.
      This
      Agreement, together with the documents referenced herein, contains the entire
      integrated agreement of the parties hereto with respect to the subject matter
      hereof and it supersedes any and all other agreements, either oral or in
      writing, between the parties hereto with respect to the subject matter hereof.
      Each party to this Agreement acknowledges that no representations, inducements,
      promises or agreements, written, oral or otherwise, have been made by any party,
      or anyone acting on behalf of any party, which are not embodied herein, and
      that
      no other agreement, statement or promise not contained in this Agreement shall
      be valid or binding. This Agreement may not be modified or amended by oral
      agreement, but only by an agreement in writing signed by the Chairman of the
      Board of the Company and Executive.

    

    12. Mutual
      Arbitration Agreement.
      To the
      fullest extent allowed by law, any controversy, claim or dispute between
      Executive and the Company (and/or any of its affiliated, subsidiary, or related
      entities, owners, directors, officers, employees, volunteers or agents) relating
      to or arising out of this Agreement or Executive's employment (or the cessation
      thereof), will be submitted to final and binding arbitration in Orange County,
      California, for determination in accordance with the American Arbitration
      Association's ("AAA") Employment Arbitration Rules as the exclusive remedy
      for
      such controversy, claim or dispute. In any such arbitration, the parties may
      conduct discovery to the same extent as would be permitted in a court of law.
      The arbitrator shall issue a reasoned, written decision, and shall have full
      authority to award all remedies which would be available in court. The Company
      shall pay the arbitrator's fees and any AAA administrative expenses. Any
      judgment upon the award rendered by the arbitrator may be entered in any court
      having jurisdiction thereof. Possible disputes covered by the above include
      (but
      are not limited to) unpaid wages, breach of contract (including this Agreement),
      torts, violation of public policy, discrimination, harassment, or any other
      employment-related claims under laws including, but not limited to, Title VII
      of
      the Civil Rights Act of 1964, the Americans With Disabilities Act, the
      California Labor Code, the California Fair Employment and Housing Act, the
      Age
      Discrimination in Employment Act, the Americans with Disabilities Act, and
      any
      other statutes or laws relating to Executive’s relationship with the Company
      regardless of whether such dispute is initiated by Executive or the Company.
      Thus, this bilateral arbitration agreement fully applies to any and all claims
      that the Company may have against Executive, including but not limited to claims
      for misappropriation of Company property, disclosure of proprietary information
      or trade secrets, interference with contracts, trade libel, gross negligence,
      or
      any other claim for alleged wrongful conduct or breach of the duty of loyalty.
      However, claims for workers’ compensation benefits, unemployment insurance and
      those arising under the National Labor Relations Act (or any other claims where
      mandatory arbitration is prohibited by law) are not covered by this arbitration
      agreement, and such claims may be presented to the appropriate court or
      government agency. BY AGREEING TO THIS BINDING ARBITRATION PROVISION, BOTH
      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.

    

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    13. Attorneys'
      Fees.
      In the
      event of any arbitration arising out of this Agreement, the prevailing party
      shall be entitled to recover from the non-prevailing party its costs and
      expenses (including reasonable attorneys' fees) incurred in such
      arbitration.

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the dates set
      forth below.

    

    

    EXECUTIVE:

    

     

    /s/
      Marc H.
      Nussbaum                    
           June 4,
      2007

    Marc
      H.
      Nussbaum               Date

    

    

    COMPANY:

    

    LANTRONIX,
      INC.

    A
      Delaware Corporation

     

     

    
      By: 
/s/
        HK
        Desai                                           June 8,
        2007
HK
      Desai          
             
      Date

    Its: Chairman
      of the Board of
      Directors

    

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    

    "Substantially
      Lessens Executive's Title" shall mean that the Executive does not have the
      title
      of President, Chief Executive Officer.

    

    "Substantially
      Reduces Executive's Senior Authority" shall mean that the Executive no longer
      has substantially similar authority, scope of responsibility, functions or
      duties as President and Chief Executive Officer.

     

     

     

     

    -11-

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