Document:

EXHIBIT 10.1
    

    
      SUBLEASE
    

    
      THIS SUBLEASE (this “Sublease”) is made and entered as of
      July 11, 2008 (the “Commencement Date”), by and
      between LION, INC., a Washington corporation (“Sublessor”),
      and BEANSTALK NETWORKS ACQUISITION LLC, a Florida limited liability
      company (“Sublessee”).
    

    
      RECITALS
    

    
      A.        Sublessor leases from Clark, Banks & Peacock, dba Pacific
      Alpine, a Washington general partnership (“Lessor”),
      certain premises consisting of the entire building (approximately 8,376
      square feet) located at 2801 Hollycroft Street, Gig Harbor, WA 98335
      (the “Building” or “Premises”), under
      that certain Lease Agreement dated as of April 1, 2004  (the “Master
      Lease”).  A copy of the Master Lease is attached hereto as Exhibit
      A.  Capitalized terms used and not defined in this Sublease shall
      have the respective meanings set forth in the Master Lease.
    

    
      B.        Sublessor and Sublessee have entered into that certain Asset
      Purchase Agreement dated as of May 12, 2008 (the “APA”)
      under which Sublessee is purchasing substantially all of Sublessor’s
      assets and assuming certain of Sublessor’s liabilities as more fully set
      forth therein.
    

    
      C.        Pursuant to the APA, Sublessor has agreed to sublease the
      portion of the Premises described below to Sublessee on the terms and
      conditions hereinafter set forth.
    

    
      D.        It is the parties’ intent that the Commencement Date shall be
      the same day as the “Closing” of the transactions contemplated by the
      APA (“Closing”).  
    

    
      AGREEMENT
    

    
      NOW, THEREFORE, in consideration of the rents, covenants,
      agreements, stipulations, and provisions contained herein to be paid,
      kept and performed and other good and valuable consideration, the
      receipt and adequacy of which are hereby acknowledged, the parties do
      hereby agree as follows:
    

    
      1.  DESCRIPTION OF SUBLEASE PREMISES
    

    
         1.1  Premises and Sublease Premises.  The
      portion of the Premises hereby sublet (the “Sublease Premises”)
      is comprised of an undifferentiated and commingled fifty percent (50%)
      portion of the Premises demised under the Master Lease.  Accordingly, as
      the Premises consists of approximately 8,376 rentable square feet, the
      Sublease Premises shall consist of approximately 4,188 rentable square
      feet.  
    

    
         1.2  Sublease of the Sublease Premises,
      and Acceptance of the Sublease Premises.  Sublessor subleases the
      Sublease Premises to Sublessee, and Sublessee subleases the Sublease
      Premises from Sublessor, as of the Commencement Date, on terms and
      conditions of this Sublease.    Sublessee agrees to accept the Sublease
      Premises in its present “AS IS” condition on the Commencement
      Date.  Sublessor makes no representations as to the condition of the
      Sublease Premises, the Premises or the Building, or the condition of any
      existing tenant improvements.
    

    
      
        

        

      

      
        
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         1.3  Surrender of Sublease Premises.  Sublessee
      shall, at the end of the Term, or upon sooner termination of this
      Sublease, promptly surrender the Sublease Premises in good order and
      condition and in conformity with the applicable provisions of this
      Sublease and the Master Lease, excepting only reasonable wear and
      tear.   
    

    
      2.  MASTER LEASE
    

    
         2.1  Assumption by Sublessee.  Sublessee
      acknowledges to Sublessor that it has received and reviewed the Master
      Lease.  Sublessee expressly assumes all of the responsibilities and
      obligations of Sublessor under the Master Lease as it pertains to the
      Sublease Premises and any available common area except for the
      obligation to pay rent to the Lessor.  
    

    
         2.2  Master Lease Controlling.  Except
      for Sublessor’s liability for its own misconduct, breach or default (all
      of which are excluded from Sublessee’s rights and obligations under this
      Sublease), all of the terms and conditions contained in the Master Lease
      are incorporated herein by this reference as terms and conditions of
      this Sublease and, along with all of the provisions of this Sublease,
      shall be the complete terms and conditions of this Sublease.  Sublessee
      agrees to perform, observe and be bound by all of the promises,
      obligations, acknowledgments, terms and conditions of, by or applicable
      to Sublessor under the Master Lease as the same relate to the Sublease
      Premises, except as may otherwise be provided herein.  For purposes of
      Sublessee’s obligations under the preceding sentence, each reference to
      "Tenant” in the Master Lease shall mean Sublessee, each reference to
      “Landlord" in the Master Lease shall mean Sublessor, and (unless context
      indicates otherwise) each reference to “Premises” in the Master Lease
      shall mean the Sublease Premises.  As between Sublessor and Sublessee,
      the terms of this Sublease shall control over any conflicting terms of
      the Master Lease.
    

    
      3.  TERM
    

    
      3.1       Term.  The term of
      this Sublease (the “Term”) shall be on a month-to-month
      basis from the Commencement Date to no later than March 31, 2009, with
      the first month of the Term comprising a partial month if the
      Commencement Date falls on a date other than the first day of a calendar
      month.  Sublessee shall have no option to extend the Term,
      notwithstanding Sublessor’s rights under Paragraph 23 of the Master
      Lease.  Sublessee shall provide Sublessor with twenty (20) days’ advance
      written notice of its intent to terminate this Sublease and vacate the
      Sublease Premises at any point during the Term.  
    

    
      3.2       Holdover.  In the
      event that Sublessee remains in possession of the Sublease Premises
      beyond the expiration date of the Term (or the date this Sublease
      otherwise terminates) without the prior written consent of Sublessor and
      Lessor, it is the intention of the parties and it is hereby agreed that
      a tenancy at sufferance shall arise at a monthly rent equal to 150% of
      the Rent due under this Sublease.  Sublessee shall indemnify and hold
      harmless Sublessor from and against any and all liability, claims,
      demands, expenses, damages and judgments incurred by Sublessor as a
      result of Sublessee wrongfully retaining possession.
    

    
      4.  RENT
    

    
      Sublessee covenants and agrees to pay to Sublessor, in advance and
      without deduction or set off, monthly rent during the Term in the amount
      of Five Thousand, Eight Hundred Twenty-three and 63/100s Dollars
      ($5,823.63) (the "Base Rent").  Base Rent for the first
      month or partial month, as the case may be, of the Term  shall be paid
      to Sublessor in advance on or before the Commencement Date, with any
      partial month prorated based on the number of days in such period as
      compared to the actual number of days in the month.   Thereafter, Base
      Rent shall be payable in advance on or before the first day of each
      month during the Term.
    

    
      
        

        

      

      
        
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      5.  TAXES AND OPERATING EXPENSES
    

    
      In addition to the Base Rent payable hereunder, Sublessee shall pay or
      reimburse Sublessor for fifty percent (50%) of all operating costs and
      expenses allocated to the Tenant under the Master Lease that are
      incurred or attributable during Sublessee's tenancy and/or
      possession.  Such reimbursements shall be made within five (5) days
      after Sublessor gives Sublessee a copy of the related demand from
      Lessor, or any invoice from a third-party utility or service
      provider.    
    

    
      6.  PLACE AND NOTICE OF RENT PAYMENT
    

    
      All Base Rent and any additional rent and other amounts due and payable
      to Sublessor hereunder (collectively, “Rent”) shall be paid
      to Sublessor at its address for notices stated in this Sublease or to
      such other address as Sublessor specifies to Sublessee in writing for
      such purpose from time to time.  If any Rent is not paid when due,
      Sublessee shall pay to Sublessor all late charges to the extent the same
      would be payable for comparable delinquencies under the Master Lease.
    

    
      7.  USE
    

    
         7.1  Sublessee’s Use.  The
      Sublease Premises shall be used for Sublessee’s general office use, and
      for no other use whatsoever.  In occupying and using the Sublease
      Premises, Sublessee shall comply with all requirements under the Master
      Lease that pertain to the Sublease Premises and all applicable laws and
      regulations.  Sublessee acknowledges that neither Lessor nor Sublessor
      nor any agent acting on their behalf has made any representation or
      warranty with respect to the suitability of the Sublease Premises for
      the conduct of Sublessee’s business.
    

    
         7.2  Parties’ Mutual Right of Entry.  Because
      the parties’ operations and use of the Building, Premises and Sublease
      Premises will by agreement be undifferentiated and commingled, each
      shall have access to the others’ work areas as reasonably necessary to
      conduct their own businesses and to work together, and both agree to act
      in good faith and with reasonable discretion when in the other’s work
      areas.  Sublessor shall at all times and upon reasonable notice have the
      right to show any part of the Building to other prospective
      subtenants.  In the case of any emergency, either party may engage in
      appropriate remedial action as needed throughout the Building.
    

    
         7.3  Signage.  Sublessee shall place
      no signage in or about the Building, nor remove or alter any existing
      signage of Sublessor or Lessor.   
    

    
         7.4  Utilities and Services.  From
      and after the Commencement Date, Sublessor shall maintain all utilities
      and services serving the Premises and Sublease Premises in its
      name.  Sublessor shall control, maintain and make available to Sublessee
      all such utilities and services, and Sublessee shall reimburse Sublessor
      for fifty percent (50%) of all costs and expenses associated
      therewith.  Such reimbursements shall be made within five (5) days after
      Sublessor gives Sublessee a copy of the related demand from Lessor, or
      any invoice from a third-party utility or service provider.  
    

    
      8.  ALTERATIONS AND MODIFICATIONS
    

    
      Sublessee shall make no alterations, additions or improvements in, on or
      about the Sublease Premises, the Premises or the Building without
      Sublessor's and Lessor's prior written consent, which may be withheld in
      the sole discretion of either.  Any permitted alterations, additions or
      improvements by Sublessee shall be made strictly in accordance with the
      Master Lease, in accordance with all applicable statutes and ordinances,
      free of material defects, and on a lien-free basis and at Sublessee's
      sole expense.  Sublessee shall require every contractor it retains to
      effect any alterations, additions, or improvements in or about the
      Sublease Premises to obtain and keep in full force and effect liability
      insurance with at least $1,000,000 coverage, and which names Lessor and
      Sublessor as additional named insureds against losses, damages and
      expenses relating to any property damage or personal injury (including
      death) caused by such contractor or any of its subcontractors, agents or
      employees.    At the end of the Term or upon sooner termination of this
      Sublease, and in accordance with Paragraph 8 of the Master Lease,
      Sublessee shall not remove any alterations, additions or improvements
      that Sublessee has made to the Sublease Premises, and the same shall
      become the property of Lessor without any obligation of either Lessor or
      Sublessor to pay for the same.  Furthermore, if Lessor  requires
      Sublessor to remove or restore any alterations, additions or
      improvements made to the Sublease Premises by Sublessee during the Term
      of this Sublease, Sublessee shall undertake and pay for such actions.
    

    
      
        

        

      

      
        
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      9.  INSURANCE AND INDEMNITY
    

    
      Sublessee shall obtain and keep in full force and effect the insurance
      required of the Sublessor under the Master Lease and shall name Lessor
      and Sublessor as additional insureds.  Concurrent with the mutual
      execution of this Sublease, Sublessee shall furnish to Lessor and
      Sublessor a certificate or certificates of insurance confirming that the
      required insurance is in full force and effect with all premiums paid
      current.
    

    
      10.  PERSONAL PROPERTY
    

    
      Sublessee agrees to assume full risk and responsibility for its personal
      property located at the Sublease Premises, the Premises and the
      Building, and releases and shall hold Sublessor and Lessor harmless for
      damage to Sublessee’s personal property sustained by fire, theft or
      other casualty loss except to the extent caused by the gross negligence
      or willful misconduct of Sublessor or Lessor or any of their
      employees.  Sublessee shall be solely responsible for insuring its own
      property in the Sublease Premises.  Sublessor shall not be responsible
      for loss or damage to the personal property of Sublessee, its
      sublessees, employees, customers or invitees, in the absence of the
      negligent act or willful misconduct of Sublessor, its agents, servants
      or employees.
    

    
      11.  MUTUAL WAIVER OF SUBROGATION
    

    
      Whether loss or damage is due to the negligence of Lessor, Sublessor or
      Sublessee, or their agents or employees, or any other cause, Sublessor
      and Sublessee do each hereby mutually release and relieve Lessor and the
      other, their agents or employees, from responsibility for, and waive
      their entire claim of recovery for:  (i) any loss or damage to the real
      or personal property of either party located anywhere in the Sublease
      Premises, including the improvements of the Sublease Premises, arising
      out of or incident to the occurrence of any of the perils which under
      the Master Lease or this Sublease are covered, or are required to be
      covered, by the parties’ respective property and related insurance
      policies; and (ii) any loss resulting from business interruption at the
      Sublease Premises or loss of rental income from the improvements of the
      Sublease Premises, arising out of or incident to the occurrence of any
      of the perils covered by any business interruption insurance policy, or
      by any loss of rental income insurance policy, which may be held by
      Lessor, Sublessor or Sublessee.  Each party shall cause its insurance
      carriers to consent to the foregoing waiver of rights of subrogation
      against the other parties.  The releases and waivers contained in this
      Section shall be inapplicable if said releases and waivers have the
      effect, but only to the extent said releases and waivers would have the
      effect, of invalidating any insurance coverage of the parties hereto.
    

    
      
        

        

      

      
        
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      12.  INDEMNITY
    

    
      Each party shall indemnify, hold harmless and defend the other party
      from all third-party claims (including any court costs, damages,
      liabilities, and reasonable and necessary attorney fees incurred by the
      indemnified party) based upon the indemnifying party’s default under
      this Sublease or the Master Lease, or as the result of any act or
      failure to act by the indemnifying party, its agents, employees,
      customers, invitees, licensees, successors, heirs or assigns with regard
      to the Sublease Premises as provided in this Sublease or the Master
      Lease as incorporated herein.  Each party also agrees to indemnify,
      defend and hold harmless the other party from all claims, costs,
      damages, liabilities and loss incurred by the other party as a result of
      the indemnifying party’s use of toxic or hazardous materials,
      pollutants, contaminants or hazardous wastes on or about the Sublease
      Premises.
    

    
      13.  CONDEMNATION, DESTRUCTION OR DAMAGE TO THE PREMISES OR THE
      SUBLEASE PREMISES THEREIN
    

    
      In the event the Premises or any part thereof (other than the Sublease
      Premises) are, at any time prior to or during the Term of this Sublease,
      condemned, damaged by fire or other casualty, this Sublease shall remain
      in full force and effect unless and until the Master Lease is canceled
      by Lessor or Sublessor.  If either the Master Lease is canceled for such
      cause or the Sublease Premises is rendered untenantable, Sublessee’s
      obligations hereunder shall abate as of the effective date
      thereof.  Otherwise, such obligations shall abate only to the actual
      monetary extent and for the duration that Sublessor’s obligations for
      the Premises are reduced in accordance with the terms of the Master
      Lease.  Untenantability shall be determined by reference to the
      reasonable usability of the Sublease Premises for the permitted use of
      the Sublease and not to the extent of actual physical damage.  If the
      damage or condemnation to any part of the Premises other than the
      Sublease Premises does not result in the cancellation of the Master
      Lease, Sublessee shall have no termination right under this Section and
      Sublessee shall not have the right to compel Sublessor to continue or
      cancel the Master Lease.
    

    
      14.  SUBLEASING OR ASSIGNMENT
    

    
                Sublessee shall have no right to transfer or assign this
      sublease or further sublease the Sublease Premises absent the prior
      written consent of Sublessor and Master Lessor.
    

    
      15.  SUBLESSEE’S DEFAULT
    

    
      The occurrence of any one or more of the following events shall
      constitute an event of default under this Sublease by Sublessee:
    

    
        15.1  Monetary.  The failure by Sublessee
      to make any payment of Rent or any other payment required to be made by
      it hereunder on the date due where such failure shall continue for a
      period of ten  (10) days after written notice of default from Sublessor
      to Sublessee.
    

    
        15.2  Performance.  The failure by
      Sublessee to observe or perform any of the covenants, conditions or
      provisions of this Sublease other than as described in the immediately
      preceding Section and/or the failure by Sublessee to observe or perform
      any of the covenants, conditions or provisions of the Master Lease to
      which Sublessee has agreed to be bound pursuant to the terms of this
      Sublease, where such failure shall continue for a period of fifteen (15)
      days after written notice thereof from Sublessor to Sublessee and such
      additional time, if any, as is reasonably necessary to cure such default
      if such default is of such a nature that it cannot reasonably be cured
      within fifteen (15) days, provided that Sublessee commences such cure
      within that period and diligently prosecutes it to completion in good
      faith and with due diligence and provided that such cure is completed
      within sixty (60) days from the date of such notice from Sublessor.
    

    
      
        

        

      

      
        
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        15.3  Financial Condition.  The making by
      Sublessee of any general arrangement or assignment for the benefit of
      creditors; Sublessee becomes a “debtor” as defined in 11 U.S.C. § 101 or
      any successor statute thereto (unless, in the case of a petition filed
      against Sublessee, the same be dismissed within thirty (30) days); the
      appointment of a trustee or receiver to take possession of all or
      substantially all of Sublessee’s assets or of Sublessee’s interest in
      this Sublease, where possession is not restored to Sublessee within
      thirty (30) days; or the attachment, execution or other judicial seizure
      of all or substantially all of Sublessee’s assets or of Sublessee’s
      interest in this Sublease, where such seizure is not discharged within
      thirty (30) days.
    

    
        15.4  Abandonment.  The abandonment of the
      Sublease Premises if Sublessee fails to timely pay Rent by the date it
      is due.  
    

    
      16.  REMEDIES
    

    
                In the event of any default under or breach of this Sublease
      by Sublessee, Sublessor shall have all of the remedies provided for
      Lessor under the Master Lease in the event of a default by Sublessor
      thereunder and the same are fully incorporated herein by this reference,
      with Sublessor being the Lessor, Sublessee the Tenant, and this Sublease
      the Master Lease, as such terms are therein employed.  No act by
      Sublessor other than giving written notice to Sublessee shall terminate
      this Sublease.  No remedy or election hereunder shall be deemed
      exclusive, but shall, whenever possible, be cumulative with all other
      remedies at law or in equity.
    

    
      17.  NOTICES
    

    
        17.1  Under Sublease.  All notices given
      under this Sublease shall be in writing and delivered to all the parties
      either in person, by facsimile transmission, or by registered or
      certified mail with postage prepaid.  Notices delivered in person or by
      facsimile transmission shall be deemed effective upon confirmed
      delivery, and all mailed notices shall be deemed received two (2) days
      after the postmark affixed on the envelope by the United States Post
      Office.  All notices shall be delivered to the parties at the following
      addresses, or at such other address as a party may from time to time
      designate in writing:
    

    
    	
          To Sublessor:
        	
          Lion, Inc.
        
	

        	
          2801 Hollycroft Street
        
	

        	
          Gig Harbor, Washington 98335
        
	

        	
          Attn: Steve Thomson
        
	

        	
           
        
	

        	
          Fax No.: 253-858-8956
        
	

        	
           
        
	
          To Sublessee:
        	
          Beanstalk Networks Acquisition LLC
        
	

        	
          314 Clematis Street, Suite 200
        
	

        	
          West Palm Beach, Florida 33401
        
	

        	
          Attn: James P. Kelly
        
	

        	
           
        
	

        	
          Fax No.: 561- 650-8106
        

    

    
        17.2  Under Master Lease.  Sublessee shall
      promptly provide Sublessor with a true and complete copy of all notices
      received from Lessor regarding the Premises, the Master Lease or this
      Sublease.
    

    
      
        

        

      

      
        
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      18.  MISCELLANEOUS
    

    
        18.1  Lessor’s Consent Required.  This
      Sublease shall have no force or effect and the parties shall have no
      obligation under this Sublease until the parties have received the
      attached Lessor’s Consent signed by Lessor or other acknowledgement of
      Lessor’s written consent to this Sublease in a form reasonably
      acceptable to Sublessor and Sublessee.
    

    
        18.2  Brokers.  Sublessor and Sublessee
      acknowledge that no broker or agent has been authorized to make any
      representation with respect to the Sublease Premises or in connection
      with this Sublease.  Each party to this Sublease shall pay any
      commission in connection therewith to which it has agreed in any written
      agreement in effect as of the Commencement Date, and each party shall
      defend and indemnify the other party hereto from and against any claims
      for any payment, commission or reimbursement for which such indemnifying
      party is so responsible.
    

    
        18.3  Controlling Law; Venue.  This
      Sublease will be construed and enforced in accordance with the laws of
      the State of Washington and the venue of any action to interpret or
      enforce the provisions of this Sublease shall be laid in the county in
      which the Premises are located.
    

    
        18.4  Authority.  Sublessee and Sublessor,
      and the persons executing this Sublease on behalf of Sublessee and
      Sublessor each represent and warrant that the individuals executing this
      Sublease are duly authorized to execute and deliver this Sublease on
      behalf of the party for whom they are signing.
    

    
        18.5  Further Documents.  Each party agrees
      to execute and deliver to the other all instruments which may reasonably
      be required to carry out all terms and provisions of this Sublease.
    

    
        18.6  Recording.  Neither this Sublease,
      nor any memorandum of this Sublease shall be recorded.
    

    
        18.7  Estoppel Certificates.  Sublessee
      agrees to provide all estoppel certificates that may be required of
      Sublessor upon request of Lessor pursuant to the Master Lease, and to do
      so within the time frame required by Lessor.
    

    
        18.8  Recovery of Costs and Fees.  If
      either party shall bring any action or arbitration to enforce any of its
      rights under this Sublease or for any relief against the other party
      with regard to the matters contained in this Sublease or if either party
      incurs any legal or professional fees whatsoever (including but not
      limited to those of appraiser’s accountant’s or any payments to
      collection agents) to enforce this Sublease with or without litigation
      or arbitration, all reasonable costs and expenses, including without
      limitation reasonable attorneys’ and professional fees of the prevailing
      party, shall be paid by the losing party.
    

    
        18.9  Binding Effect.  Subject to the
      applicable restrictions of this Sublease and the Master Lease, this
      Sublease shall be binding upon the successors and permitted assigns of
      Sublessor and Sublessee.
    

    
        18.10  Legal Relationship of the Parties.  This
      Sublease shall not be interpreted or construed as establishing a
      partnership or joint venture between Sublessor and Sublessee, and
      neither party shall be liable for the debts or obligations of the other
      except as expressly agreed to herein.
    

    
      
        

        

      

      
        
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      18.11  Waivers.  No waiver shall arise or result from
      any act or omission by any party to this Sublease except when made in
      writing signed by such party.
    

    
       18.12  Time of Performance.  Time is of the
      essence in each provision of this Sublease.
    

    
       18.13  Survival.  All representations, warranties
      and indemnities contained in this Sublease shall survive termination of
      the Master Lease and the Sublease.
    

    
       18.14  Validity.  If a court of competent
      jurisdiction determines that any portion of this Sublease is invalid or
      unenforceable, that determination shall not affect the validity or
      enforceability of the remaining provisions of this Sublease, so long as
      the primary purpose of this Sublease is not materially impaired.
    

    
       18.15  Entire Agreement; Amendments.  This
      Sublease embodies all of the agreements between the parties with respect
      to the Sublease Premises, and no oral agreements, prior correspondence
      or other prior writings shall be held to vary the provisions
      hereof.  Any subsequent changes or modifications shall become effective
      only by a written instrument duly executed by Sublessee and Sublessor
      after the date of this Sublease.
    

    
       18.16  Execution in Counterparts.  This Sublease
      may be executed in two (2) or more counterparts, all of which shall
      constitute but one and the same Sublease.
    

    
      IN WITNESS WHEREOF, the parties hereto have executed this
      Sublease as of the Commencement Date.
    

    
    	
          "Sublessor"
        	
          "Sublessee"
        
	

        	
           
        
	
          LION, INC.,
        	
          BEANSTALK NETWORKS
        
	
          a Washington corporation
        	
          ACQUISITION LLC,
        
	

        	
          a Florida limited liability company
        
	

        	
           
        
	

        	
           
        
	
          By:______________________________
        	
          By:________________________________
        
	
          Name:___________________________
        	
          Name:_____________________________
        
	
          Its:______________________________
        	
          Its:________________________________
        

    

    
      
        

        

      

      
        
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      LESSOR'S CONSENT
    

    
                Clark, Banks & Peacock, dba Pacific Alpine, a Washington
      general partnership (the "Lessor"), the Lessor under the Master Lease
      defined in the foregoing Sublease (the "Sublease"), hereby consents to
      the subletting of a  portion of the Premises under the terms set forth
      in the Sublease.  However, by this consent, Lessor does not approve or
      disapprove the Sublease, and neither the execution of this Sublease nor
      any actions taken pursuant to the provisions thereof shall be deemed or
      construed to modify the Master Lease.  It is understood that Lion, Inc.,
      remains liable for its obligations under the Master Lease.  This consent
      shall not be deemed to increase the obligations or liabilities of the
      Master Lease, nor shall it be deemed as consent to any other or further
      subletting.
    

    
    	
          Dated: ____________________, 2008
        	
          "Lessor"
        
	

        	
           
        
	

        	
          CLARK, BANKS & PEACOCK,
        
	

        	
          a Washington general partnership
        
	

        	
           
        
	

        	
          By_____________________________
        
	

        	
          Name:_____________________________
        
	

        	
          Its: _______________________________
        

    

    
      
        

        

      

      
        
          9
        

        
          

        

      

      
        

        

      

    

    

    

    
      Exhibit A
    

    
      Master Lease to be Attached
    

    

    

    

    

    

    

    

    

    

    

    
      10Exhibit 10.1

            EXECUTIVE AGREEMENT between Sono-Tek Corporation, a New York
corporation (the "Company") and R. Stephen Harshbarger ("Executive"), dated as
of the Fifth day of March, 2008.

                              W I T N E S S E T H:
                               - - - - - - - - - -

            WHEREAS, Executive is an employee of the Company and is an integral
part of its management; and

            WHEREAS, it is in the best interest of the Company that Executive
continue in the service of the Company without the benefits which would accrue
to Executive pursuant to an employment agreement; and

            WHEREAS, the Company wishes to assure itself of continuity of
management during the critical period of any actual or threatened change in
control of the Company.

            NOW, THEREFORE, it is hereby agreed by and between the parties as
follows:

      1.    Employment Status.

            In consideration of the benefits provided to Executive pursuant to
this Executive Agreement, Executive hereby agrees to continue to be employed by
the Company as an employee-at-will without the benefit of an employment
agreement. Nothing expressed or implied herein shall create any right or duty
(on the part of the Company or Executive) to have Executive remain in the
employment of the Company, each reserving all rights to terminate the employment
relationship at any time, with or without "Cause" (as hereinafter defined).

      2.    Term.

            The term of this Executive Agreement shall commence on the date
hereof and shall terminate on the earlier to occur of (i) termination of
Executive's employment for whatever reason, unless a Change of Control (as
hereinafter defined) shall have occurred prior to such termination or (ii)
twelve months following written notice of termination of this Executive
Agreement given by the Company or Executive.

      3.    Payment Subsequent to Change of Control.

            (a) Except as may otherwise be required in accordance with Section 8
hereof, in the event that a Change of Control of the Company shall occur during
the time Executive is employed by the Company, there shall be payable to
Executive upon the termination of Executive's employment without Cause or
Executive's Resignation for Good Reason (as hereinafter defined) within 18
months following such Change of Control a lump sum (net of any required tax or
other withholding) equal to one year of Executive's annual base and bonus
compensation paid by the Company for the previous calendar year (or such lesser
period as Executive shall have been employed by the Company) immediately
<PAGE>

preceding the Change of Control as reflected in Executive's Forms W-2 in respect
of such year. Payment made in accordance with this Section 3(a) shall represent
full satisfaction of all of the obligations of the Company under this Executive
Agreement and concurrent with receipt of such payment Executive shall execute a
document satisfactory to the Company to that effect.

            (b) For the purpose of this Executive Agreement, a "Change of
Control" of the Company shall mean any of the following:

            (i)   The sale to a "Non-Affiliate" (as defined below) of all or
                  substantially all of the assets of the Company;

            (ii)  The merger of the Company with or into a Non-Affiliate where
                  immediately following such transaction 50% or more of the
                  outstanding voting stock of the remaining entity is not owned
                  by persons who were shareholders of the Company immediately
                  prior to such transaction;

            (iii) The acquisition by any person who is not on the date hereof an
                  Affiliate or Major Shareholder (as such terms are defined
                  below) of 50% or more of the issued and outstanding stock of
                  the Company; or

            (iv)  The Board of Directors of the Company shall cease to be a
                  "Qualified Board" (as defined below).

            (c)   For purposes of this Executive Agreement:

            (i)   Persons or entities shall be "Affiliates" if one controls the
                  other or if they are under common control. "Control" shall
                  mean the ownership of 50% or more of the issued and
                  outstanding stock of any such entity.

            (ii)  "Major Shareholder" shall mean any person or entity who
                  directly or indirectly currently owns as of the date of this
                  Agreement 25% of the issued and outstanding stock of the
                  Company.

            (iii) "Qualified Board" shall mean the Board of Directors of the
                  Company which is comprised of no fewer than five persons at
                  least a majority of whose members are currently directors of
                  the Company or shall have been elected or nominated to the
                  Board by a "Qualified Board".

            (iv)  "Cause" shall mean: (1) proven or admitted (A) embezzlement,
                  or (B) material dishonest misuse of the Company funds or
                  assets; (2) an admitted or proven act constituting a felony or
                  misdemeanor (other than minor offenses such as traffic
                  violations) or conviction for such act; (3) continued conduct

                                       -2-
<PAGE>

                  materially adverse to the interests of the Company which does
                  not cease within thirty (30) days of written notice from the
                  Board of Directors of the Company; (4) repeated material
                  failure by Executive, after written warning by the Board of
                  Directors of the Company, to perform the duties of his or her
                  employment (including without limitation material failure to
                  follow or comply with the reasonable and lawful written
                  directives of the Board of Directors of the Company); or (5)
                  breach of any statutory or common law fiduciary duty of
                  loyalty to the Company which is not cured within thirty (30)
                  days of written notice from the Board of Directors of the
                  Company.

            (d) For purposes of this Executive Agreement "Resignation for Good
Reason" shall be deemed to have occurred if the Executive shall resign from all
of his or her positions as employee, officer, director of the Company, and its
Affiliates within 60 days after the occurrence of any of the following events:

            (i)   If the Executive is an officer of the Company, the Executive
                  is removed from that post except for the purposes of assuming
                  another post in the Company which other post the Executive
                  accepts.

            (ii)  The imposition on the Executive of a requirement to relocate
                  the site of his or her employment by the Company to a place
                  more than 50 miles from the site of his or her present
                  employment.

            (iii) A reduction in the Executive's rate of compensation from the
                  Company, which reduction continues after the Executive has
                  protested in writing to the Chief Executive Officer of the
                  Company referring to this Executive Agreement.

            (iv)  A substantial negative change in the duties, responsibilities
                  or supervisory authority of the Executive which change
                  persists for a period of at least 60 days after written
                  protest by the Executive to the Chief Executive Officer of the
                  Company referring to this Executive Agreement.

      4.    Notices.

            All notices, requests, demands and other communications provided for
by this Executive Agreement shall be in writing and shall be sufficiently given
if and when mailed in the continental United States by registered or certified
mail or personally delivered to the party entitled thereto at the address stated
below or to such changed address as the addressee may have given by a similar
notice:

To the Company:                           Sono-Tek Corporation
                                          2012 Route 9W
                                          Milton, NY 12547

                                       -3-
<PAGE>

To the Executive:                         R. Stephen Harshbarger
                                          13 Banks Hill
                                          Pawling, NY 12564

      5.    Agreement for Benefit of Executive.

            This Executive Agreement shall be binding upon and shall inure to
the benefit of the Executive, the Executive's heirs and legal representative,
and the Company and its successors.

      6.    Amendment or Modification; Waiver.

            No provision of this Executive Agreement may be amended, modified or
waived unless such amendment, modification or waiver shall be authorized by the
Boards of Director of the Company or any authorized committees of the Boards of
Directors and shall be agreed to in writing, signed by the Executive and by an
officer of the Company thereunto duly authorized. Except as otherwise
specifically provided in this Executive Agreement, no waiver by either party
hereto of any breach by the other party hereto of any condition or provision of
this Executive Agreement to be performed by such other party shall be deemed a
waiver of a subsequent breach of such condition or provision or a waiver of a
similar or dissimilar provision or condition at the same or at any prior or
subsequent time.

      7.    Governing Law.

            This Agreement shall be governed by and interpreted and construed in
accordance with the internal laws of the State of New York (without reference to
principles of conflicts or choice of law).

      8.    Section 409A.

            Notwithstanding anything to the contrary in this Agreement, if the
Company determines (a) that on the date the Executive's employment with the
Company terminates or at such other time that the Company determines to be
relevant, the Executive is a "specified employee" (as such term is defined under
Section 409A of the Internal Revenue Code) of the Company and (b) that any
payments to be provided to the Executive pursuant to this Agreement are or may
become subject to the additional tax under Section 409A(a)(1)(B) of the Code or
any other taxes or penalties imposed under Section 409A of the Code ("Section
409A Taxes") if provided at the time otherwise required under this Agreement,
then such payments shall be delayed until the date (the " Deferred Payment
Date") that is six months after the date of the Executive's "separation from
service" (as such term is defined under Section 409A of the Code) with the
Company, or such shorter period that, as determined by the Company, is
sufficient to avoid the imposition of Section 409A Taxes; it being understood
that any payments so delayed shall become payable in the aggregate on the
Deferred Payment Date. It is the intent of the parties that the provisions of
this Agreement comply with Section 409A of the Code and related regulations and
Department of the Treasury pronouncements. Accordingly, notwithstanding any
provision in this Agreement to the contrary, this Agreement will be interpreted,
applied and to the minimum extent necessary, unilaterally amended by the Company
in its sole discretion, without the consent of Executive, as the Company deems

                                       -4-
<PAGE>

appropriate for the Agreement to satisfy the requirements of Section 409A and to
avoid the imposition of Section 409A Taxes. Notwithstanding the foregoing, the
Company shall not be liable for any taxes, penalties, interest or other costs
that may arise under Section 409A or otherwise.

            IN WITNESS WHEREOF, the parties hereto have executed this Executive
Agreement as of the day and year first above written.

                                            By /s/ Christopher L. Coccio
                                               --------------------------
                                               Christopher L. Coccio
                                               Chief Executive Officer

                                            /s/ R. Stephen Harshbarger
                                            -----------------------------
                                            R. Stephen Harshbarger

                                       -5-

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