Document:

Exhibit 10.2

 

 

 

 

 

 

 

 

 

 

SUPPLY AND COMMERCIALIZATION AGREEMENT

BY AND BETWEEN

VIASPACE GREEN ENERGY INC.

AND

VIASPACE INC.

 

 

 

 

 

 

September 30, 2012

 

 

 

 

 

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SUPPLY, LICENSE AND COMMERCIALIZATION

AGREEMENT

 

THIS SUPPLY, LICENSE
AND COMMERCIALIZATION AGREEMENT (the “Agreement”) is entered into as of the 30th day of September 2012 (the “Effective
Date”) by and between VIASPACE Green Energy, Inc., a British Virgin Islands company (“VGE”)
and VIASPACE Inc., a corporation organized under the laws of the State of Nevada, with offices located within the State of California
(“VIASPACE”). VGE and VIASPACE are sometimes referred to herein individually as a “Party” and collectively
as the “Parties.” Except as otherwise defined within the text, capitalized terms and phrases shall have the meaning
ascribed thereto in Article 1 of this Agreement.

 

RECITALS:

 

VGE controls certain
know-how and other rights related to Giant King Grass. Through its stock ownership in VGE through the Effective Date, VIASPACE
has garnered considerable knowledge and experience in promoting and marketing Giant King Grass. VGE and VIASPACE believe that a
license and supply arrangement regarding Giant King Grass would be desirable and beneficial to both Parties. On and subject to
the terms and conditions set forth herein, VGE and VIASPACE therefore desire to provide for the supply and commercialization of
Giant King Grass as described herein.

 

NOW, THEREFORE,
in consideration of the covenants and conditions set forth in this Agreement, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereby enter into this Agreement:

 

ARTICLE 1

DEFINITIONS

 

For the purpose of this Agreement, the
following expressions shall have the meanings ascribed thereto as follows, unless the context expressly requires otherwise:

 

“Action” shall mean
any claim, action, cause of action or suit (whether in contract or tort or otherwise), litigation (whether at law or in equity,
whether civil or criminal), assessment, arbitration, investigation, hearing, charge, complaint, or other legal proceeding.

 

“Affiliate” shall mean
any entity that controls, is controlled by, or is under common control with a Party. Without limiting the generality of the foregoing,
a Person shall be regarded as in control of another Person if it, directly or indirectly, owns, controls or otherwise possesses:
(a) in excess of fifty percent (50%) of the voting stock or other applicable ownership interest thereof of the other Person or
(b) the power to direct or cause the direction of the management and policies of such other Person.

 

“Business Day” shall
mean a day on which banking institutions in both Atlanta, Georgia and Los Angeles, California are open for business.

 

“Commercial License”
shall have the meaning ascribed thereto in Section 2.1(a) of this Agreement.

 

“Commercialization”
or “Commercialize” shall mean to import, grow, sell, market and distribute a product, plant or material.

 

“Competitive Product”
shall have the meaning ascribed thereto in Section 2.2 of this Agreement.

 

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“Confidential Information”
shall mean any and all technical, financial, business and other information, including, without limitation, Trade Secrets, that
is (a) of tangible or intangible value to the Disclosing Party or of any Affiliate thereof or any Business Contact of Disclosing
Party or any such Affiliate, or (b) otherwise clearly marked by such Party or Affiliate thereof as confidential at the time of
disclosure or, if disclosed orally or visually, is stated to be confidential and is subsequently documented in writing or other
tangible form with such conspicuous designation that is delivered to the Receiving Party within a reasonable period of time following
any such disclosure, which information shall be deemed to include, without limitation, financing structures and proposals, proprietary
technology, concepts, designs, ideas, inventions, research, development, compounds, biological materials, patent applications,
know-how and other intellectual property rights; the work product; business contacts and other customers and suppliers and agreements
or understanding with any of them; pricing information and strategy; business practices, procedures, processes, methodologies,
plans, techniques and strategies; standard operating procedures; product specifications (including, without limitation, the genetic
or biologic composition or makeup thereof) and testing results, financial information (such as tax returns, financial statements,
accounting records, audit letters, work papers, expert opinions); counsel and other advisory opinions; and all other information
relating thereto, along with this Agreement and any term or condition hereof, and any and all such information of any Third Party
that is provided to us under restrictions on either disclosure or use (or both). Notwithstanding the foregoing, Confidential Information
shall not include information that (a) is known to the Receiving Party at the time of the disclosure, as evidenced by its written
records; (b) is disclosed to the Receiving Party by a Third Party lawfully in possession of such information and not under an obligation
of nondisclosure; (c) is or becomes patented, published or otherwise part of the public domain through no fault of the Receiving
Party; (d) is developed by or for the Receiving Party independently of Confidential Information disclosed hereunder as evidenced
by Receiving Party’s written records or other competent evidence; or (e) is required by law to be disclosed by Receiving
Party, provided that the Receiving Party gives the Disclosing Party hereto prompt notice of such legal requirement such that such
Disclosing Party shall have the opportunity to apply for confidential treatment of such Confidential Information. For purposes
of this Agreement, the following information shall be deemed to constitute the Confidential Information of VGE: any and all proprietary
technology, concepts, designs, ideas, inventions, research, development, compounds, biological materials, patent applications,
know-how and other intellectual property rights; work product; procedures, processes, methodologies, plans, techniques and strategies;
standard operating procedures; product specifications (including, without limitation, the genetic or biologic composition or makeup
thereof) and testing results for, relating to or arising out of the VGE IP, including, without limitation, GKG and GKG IP.

 

“Contract Year” shall
mean a period consisting of twelve (12) consecutive calendar months commencing on the Effective Date or anniversary thereof of
each year.

 

“Control” or “Controlled”
shall mean, shall mean, with respect to any intellectual property right or other intangible property, the ability of a Party or
its Affiliates to grant to any other Person a license or sublicense to use such rights without violating the rights of any Third
Party.

 

“Deliver” or “Delivery”
shall mean delivery to VIASPACE’s designated carrier in the People’s Republic of China of a product described in a
VIASPACE Purchase Order issued to VGE pursuant to this Agreement.

 

“Designated Representatives”
shall mean those officers, directors, employees and agents of Receiving Party, who are provided Confidential Information and other
proprietary information on a “need to know” basis only and are directed and required in writing by such Receiving Party
to both maintain the disclosed information in strict confidence and exclusively use such information solely in connection with
performing such Party’s obligations under this Agreement.

 

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“Disclosing Party” shall
mean that Party that is making a disclosure of its Confidential Information or Trade Secrets (or both) to the Receiving Party.

 

“Dollar” and the symbol
“$” mean lawful money of the United States of America.

 

“Exclusive Period” shall
mean that period of time as measured from the Effective Date through to the date on which (a) the Term of this Agreement shall
expire, (b) this Agreement is converted to a non-exclusive license, if ever; or (c) VIASPACE commences any research, development
or commercialization of a grass similar or otherwise having competitive properties to Giant King Grass (or attempting such actions)
or otherwise engages in any other act or omission in breach of this Agreement, whichever date or event is first to occur.

 

“Final Product Transfer Price”
or “FPTP” shall mean the actual cost of Manufacturing, along with the fully allocated overhead associated therewith,
for Giant King Grass Delivered to VIASPACE under this Agreement, which cost shall be determined in accordance with GAAP and fixed
for the first Contract Year and then increased thereafter by 15% for each succeeding Contract Year or such greater costs and expenses
to the extent the same are substantiated to VIASPACE. For example, as of the Effective Date, the FPTP for 45,000 GKG nodes is $1,800.

 

“First Commercial Launch”
shall mean the date on which occurs the first commercial sale of the Product or Process in each country within the VIASPACE Territory.

 

“GAAP” shall mean United
States generally accepted accounting principles applied on a consistent basis. Unless otherwise defined or stated, financial terms
shall be calculated by the accrual method under GAAP.

 

“GKG IP” shall mean
the GKG Tradename and the customer list relating to Giant King Grass and the contact information identified therein.

 

“GKG Tradename” shall
mean the name “Giant King Grass,” “GKG” or any other derivative thereof.

 

“Giant King Grass” or
“GKG” shall mean the high yield, non-genetically modified, natural hybrid grass that was received and licensed by VGE
from IPA China under the VGE License.

 

“Improvements” shall
mean any and all procedures, processes, developments, modifications, derivatives, uses or other inventions or discoveries on or
relating to Giant King Grass.

 

“Intellectual Property Rights”
or “IP” shall mean patents, patent applications, trademarks, trademark applications, trademark registrations,
tradenames, service marks, copyright, copyright applications and registrations, Trade Secret and all other such intellectual property
rights.

 

“IPA China” shall mean
Guangzhou Inter-Pacific Arts Corp., a Chinese wholly-owned foreign enterprise registered in Guangdong
province.

 

“Legal Fees” shall mean
the fees and expenses (including attorneys’ fees) not to exceed $40,000 incurred by Sung Chang or VGE or any other Affiliate
thereof (as determined after the Effective Date) in connection with the negotiation and preparation of this Agreement and all documents
relating thereto and the recapitalization of VGE and any and all documents relating thereto.

 

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“Manufacturing” or “Manufacture”
shall mean activities directed to planting, growing, harvesting, producing, manufacturing, processing, filling, finishing, packaging,
storage and quality assurance testing of a product, plant or material, whether in bulk or finished goods or otherwise.

 

“Net Sales” means, for
any period, the aggregate gross amounts invoiced for sales of a Product or any Improvement thereon or Process relating thereto
in the VIASPACE Territory (“Gross Sales”), less good faith estimates of the following deductions to the extent specifically
relating to sales and normal and customary for a product of the nature of Giant King Grass and evidenced by independent substantiation,
which shall be adjusted to actual on a periodic basis (no less frequently than annually):

 

(a)Credits
or allowances actually granted for damaged Giant King Grass, returns or rejections of Giant King Grass, chargebacks, price adjustments
and billing errors taken within 12 months of the initial sale to which they relate, each to the extent consistent with a Party’s
usual course of dealing for its products other than Giant King Grass;

 

(b)Normal
and customary trade, cash and quantity discounts, allowances and credits, in amounts customary in the trade not to exceed Seven
Percent (7%) of the invoice amount actually paid or granted in respect of each such sale, each to the extent consistent with a
Party’s usual course of dealing for its products other than Giant King Grass;

 

(c)Commissions;

 

 

(d)Sales
taxes, VAT and other taxes applied to the sale of Giant King Grass to the extent included in the gross amount invoiced; and

 

(e)An
allowance for bad debt, which shall in no event be greater than an amount reasonably approved by VIASPACE’s independent auditors.

 

“Person” shall mean
an individual, corporation, company, partnership, organization or any similar entity.

 

“Pick Up Date” shall
mean the date on which Delivery is made in accordance with Article 5 of this Agreement.

 

“Process” shall mean
any process relating to a Product that is developed, made or manufactured from VGE Confidential Information, which, as the case
may be, has not been made the subject of a public disclosure or that has not otherwise become available to the public, except through
the issuance of a patent.

 

“Product” shall mean any material,
plant, or product comprised, in whole or in part, of Giant King Grass.

 

“Receiving Party” shall
mean the Party that is in receipt of the Confidential Information delivered to it by the Disclosing Party.

 

“Term” shall mean the
term of this Agreement as defined in Section 10.1 hereof.

 

“Third Party” shall
mean any Person other than a Party under this Agreement.

 

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“Trade Secrets” shall
mean each respective Party’s know-how and other proprietary information (including, but not limited to business information,
technical or non-technical data, financial data, financial plans, lists of customers or suppliers) that: (a) derives economic
value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons
who can obtain economic value from its disclosure or use; and (b) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy. To the extent that applicable law mandates a definition of “trade secret” inconsistent
with the foregoing definition, then the foregoing definition shall be construed in such a manner as to be consistent with the mandated
definition under applicable law. For purposes of this Agreement, the following Confidential Information shall be deemed to constitute
the Trade Secrets of VGE: any and all proprietary technology, concepts, designs, ideas, inventions, research, development, compounds,
biological materials, patent applications, know-how and other intellectual property rights; work product; procedures, processes,
methodologies, plans, techniques and strategies; standard operating procedures; product specifications (including, without limitation,
the genetic or biologic composition or makeup thereof and parent plants) and testing results for, relating to or arising out of
the VGE IP, including, without limitation, GKG and GKG IP.

 

“VGE IP” shall have
the meaning ascribed thereto in Section 8.1 of this Agreement.

 

“VGE License” shall
mean that certain license entered into by and between VGE and IPA China.

 

“VGE Territory” shall
mean the People’s Republic of China and Taiwan and each respective territory and possession thereof.

 

“VIASPACE Territory”
shall mean the world other than the VGE Territory.

 

ARTICLE 2

GRANT OF LICENSE

AND

APPOINTMENT OF DISTRIBUTOR

 

2.1Commercialization
License. Subject to the terms and conditions of this Agreement, including, without limitation, the payment of the FPTP, royalties
and any and all other fees, costs and expenses described in and Section 8.2 of this Agreement, VGE hereby grants to VIASPACE for
the Term a nontransferable, royalty-bearing exclusive license to Commercialize Giant King Grass within the VIASPACE Territory and
to use the GKG IP and VGE Tradename, including, without limitation, to reproduce and publicly display the VGE Tradename and GKG
Tradename solely in connection with its license to Commercialize Giant King Grass and as otherwise provided in this Agreement (the
“Commercial License”). The Commercial License granted under this Agreement is personal to VIASPACE, with no right whatsoever
to assign, sublicense or otherwise grant any interest therein to any Third Party, without the prior written consent of VGE, which
consent will not be unreasonably withheld, delayed or conditioned. VIASPACE shall use the VGE Tradename and GKG IP only for the
purposes set forth in this Agreement and in compliance with applicable laws. VIASPACE agrees that it will do nothing inconsistent
with VGE’s ownership of the VGE Tradename or GKG IP, with its use thereof inuring to the benefit of and be on behalf of VGE
as the licensor. VIASPACE shall use the VGE Tradename and GKG Tradename in such manner that it creates a separate and distinct
impression from any other trademark, tradename or service mark and maintain at all times during the Term the good name and reputation
of VGE and such tradenames.

 

2.2VIASPACE
Restrictive Covenants.

 

(a)Competing
Giant King Grass. From and after the Effective Date and for three (3) years following the earlier of the expiration or termination
of the Agreement, VIASPACE shall not and shall cause its Affiliates to not, directly or indirectly, including, without limitation,
through a third party:

 

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(i)Manufacture
(to include, without limitation, the planting, growing, harvesting and processing of seedlings and producing of pellets therefrom),
Commercialize or otherwise engage in any research or development of a grass or any other product or material having similar or
otherwise competitive properties to Giant King Grass (a “Competitive Product”), except that upon the prior written
consent of VGE during the Term of this Agreement, for purposes of crop biodiversity; or

 

(ii)Solicit
for such prohibited purposes any customer, supplier or other vendor or employee with which VIASPACE had a relationship during the
Term for the research, development, Manufacture or Commercialization of Giant King Grass or any Competitive Product.

 

(b)No Sales
Outside of VIASPACE Territory. Without the prior written consent of VGE, in no event shall VIASPACE, directly or indirectly, (1)
attempt to Commercialize or Commercialize Giant King Grass outside of the VIASPACE Territory or knowingly supply Giant King Grass
within the VIASPACE Territory for resale or use within the VGE Territory during the Term of this Agreement; (2) make any use of
Giant King Grass or VGE Confidential Information, including, without limitation, the composition or other genetic makeup of Giant
King Grass, for any purpose or otherwise disclose any of the same to any Person whatsoever other than as is expressly permitted
under this Agreement during the Term; or (3) reverse engineer, decode or otherwise attempt to determine or determine or modify
or improve on the composition or genetic makeup of Giant King Grass or otherwise create any derivative or hybrid thereof, unless
any such activities are disclosed in advance and in writing to VGE and the results thereof are owned by and assigned to VGE upon
and coincident with any such notice (or failing notice, demand by VGE following it actually becoming aware thereof)(the “Results”),
in which event such Results shall be licensed to VIASPACE at its election upon mutually agreed terms and conditions.

 

(c)Business
Protection Agreement. Consistent with the foregoing, VIASPACE shall enter into, provide VGE an executed copy thereof and agree
to enforce a business protection agreement with each of its employees pursuant to which each such individual agrees to substantially
the same restrictions and to the reasonable satisfaction of VGE, with VGE being a third party beneficiary thereof. A form of the
Business Protection Agreement is attached hereto and marked as Exhibit “A.”

 

(d)Conditions
to Commercial License. As conditions precedent to the Commercial License, each of the following shall have been fully executed
as of the Effective Date:

 

(i)That
certain Lock Up Agreement shall have been entered into by all parties thereto; and

 

(ii)That
certain Funding Agreement entered into by and between VIASPACE and Kevin Schewe, MD.

 

2.3VGE’s
Restrictive Covenants. As of the Effective Date and for the Exclusive Period, VGE will refrain from directly or indirectly,
including, without limitation, through a third party, (a) attempting to commercialize or commercialize Giant King Grass in the
VIASPACE Territory, or (b) the Manufacture, Commercialization or research or development of a grass similar or otherwise having
competitive properties to Giant King Grass (or attempting such actions) in the VIASPACE Territory; or (c) knowingly supplying GKG
or otherwise licensing GKG IP within the VGE Territory for resale or use of GKG within the VIASPACE Territory.

 

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ARTICLE 3

RESERVATION OF RIGHTS

 

Except as expressly granted under the Commercial
License, VGE reserves to itself any and all rights to the Giant King Grass and the VGE IP. Consistent with the foregoing, nothing
in this Agreement, subject to Section 2.3(c) above, shall be deemed to restrict or otherwise impair or impede the right or ability
of VGE or any Affiliate or sublicensee thereof to market, sell, distribute, package, label or appoint additional Persons as licensees
of Giant King Grass, subcontract any such rights to, or otherwise enter into any arrangement whatsoever with any Person with respect
to Giant King Grass or otherwise deal in or with Giant King Grass within the VGE Territory.

 

ARTICLE 4

COMMERCIALIZATION

 

4.1In
General. VIASPACE, at its sole cost and expense, shall use commercially reasonable efforts to Commercialize Giant King Grass
throughout the VIASPACE Territory, which efforts shall include, without limitation, providing appropriate incentives consistent
with its normal and lawful business practices to sales representatives involved in the Commercialization of Giant King Grass. Without
limiting the foregoing, VIASPACE shall (a) prepare and provide VGE for its prior review and approval
all promotional, sales and marketing materials that are intended to be used or otherwise relied upon for the Commercialization
(the “Marketing Materials”) of Giant King Grass within the VIASPACE Territory, which shall in all events be in consistent
and compatible with the marketing materials used by VGE, if any, for Commercialization of Giant King Grass within the VGE Territory
and otherwise in compliance with applicable laws; provided, however, that if VGE shall not have either approved or
disapproved of such Marketing Materials within ten days of its receipt thereof, then such Marketing Materials shall be deemed approved
by it and in any event VGE shall not unreasonably withhold its approval of such materials; (b) not extend
any written or oral warranty or guarantee or make any representation or claims with respect to any aspect of Giant King Grass,
without VGE’s express prior written consent, which consent shall not be unreasonably delayed or denied; and (c) not make
any modifications or additions to Giant King Grass, without VGE’s express prior written consent, which consent shall not
be unreasonably delayed or denied. Subject to any limitations imposed by applicable law, all such Marketing Materials and
all documentary information and oral presentations (where practicable) regarding the marketing and promotion of Giant King Grass
in countries of the VIASPACE Territory shall acknowledge VIASPACE’s distribution and license arrangement. Copies of all Marketing
Materials used in the VIASPACE Territory will be archived by VIASPACE in accordance with applicable law.
VIASPACE shall be responsible, at its sole cost and expense, for the preparation and printing of the Marketing Materials for Commercialization
of Giant King Grass in the VIASPACE Territory.

 

4.2Sales
and Distribution. VIASPACE shall be responsible for booking sales, warehousing and distributing Giant King Grass in the VIASPACE
Territory. If VGE receives any orders for use of Giant King Grass in the VIASPACE Territory, it shall refer such orders to VIASPACE.
If VIASPACE receives any orders for use of Giant King Grass in the VGE Territory, it shall refer such orders to VGE. VIASPACE shall
be solely responsible for handling all returns and all aspects of order processing, invoicing and collection, distribution, inventory
and receivables of Giant King Grass as such matters pertain to its Commercialization within the VIASPACE Territory. If Giant King
Grass sold in the VIASPACE Territory is returned to VGE, it shall be shipped at VIASPACE’s sole cost and expense to a facility
designated by VIASPACE.

 

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4.3Reporting
of Sales. VIASPACE shall provide to VGE detailed written reports within thirty (30) days
following the last day of each calendar quarter (commencing with the first calendar quarter during a Contract Year in which the
First Commercial Sale is made of any Giant King Grass in the VIASPACE Territory), which reports shall account for unit volume,
gross sales price and any and all reductions or adjustments thereto, Net Sales and Giant King Grass inventories, which records
shall be maintained for the period described in Section 6.4(a) of this Agreement.

 

ARTICLE 5

SUPPLY OF PRODUCTS

 

5.1In General.
VIASPACE purchase orders for Giant King Grass seedlings will be filled at the Final Product Transfer Price, plus any amounts
described in Section 6.8, below, with any all such amounts being paid by VIASPACE to VGE on or before Delivery.

 

5.2Growing Costs.
VGE will pay the ongoing expenses for Giant King Grass currently growing in the Guangdong province, and VIASPACE will pay the expenses
for any other test plots grown at VIASPACE’s request and approved by VGE. Consistent with such efforts, upon reasonable prior
notice, VGE will allow VIASPACE, at VIASPACE’s sole cost and expense, to visit the Giant King Grass location and test plots
controlled by VGE or any Affiliate thereof in the Guangdong province with current and potential customers upon reasonable prior
notice, and VGE will be allowed to visit all such locations and growing locations controlled by VIASPACE or any Affiliate thereof
or any customer distributor or such other vendor of VIASPACE or any such Affiliate.

 

5.3Forecasts.
Not later than the tenth (10th) day of each calendar month during each Contract Year (the “Forecast Date”), VIASPACE
shall provide VGE, a rolling, good-faith, twelve (12) month written forecast of expected purchases by VIASPACE of Giant King Grass,
and the corresponding expected required Pick Up Dates (the “Forecast”) in order to assist VGE in its Delivery planning.
The first four (4) months of the Forecast shall be binding on VIASPACE (the “Binding Forecast”), whereas the remaining
eight (8) months shall constitute a non-binding estimate of such Giant King Grass requirements. In the event VIASPACE fails to
furnish a Forecast within five (5) days after any Forecast Date, the then current Forecast shall apply until changed at a subsequent
Forecast Date (on a ‘rolled-forward’ basis, with the new twelfth (12th) month of the Forecast being the quantity of
the ‘rolled-forward’ eleventh (11th) month). During the Term, with respect to each month that is added as the fourth
(4th) month to a Forecast, the quantities and types of Giant King Grass forecasted for such fourth (4th)
calendar month may not fluctuate (up or down) by more than five percent (5%) from the quantities and types of Giant King Grass
forecasted for such month when it was the fifth (5th) month of a Forecast.

 

5.4Purchase
Orders. VIASPACE shall submit to VGE purchase orders for Giant King Grass (“Purchase Orders”) for purchase of the
Product at the FPTP consistent with the Forecast at least sixty (60) days before Delivery, which date shall be set forth in the
Forecast and Purchase Order. Each Purchase Order shall be in writing and shall specify (a) the quantity of Giant King Grass to
be delivered; (b) VIASPACE’s required Pick Up Date of such Giant King Grass, provided, however, that in no
event shall the Pick Up Date be sooner than sixty (60) days after the date of the Purchase Order; and (c) the name, address and
phone number of the person to receive the notice of receipt.

 

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5.5Acceptance
of Purchase Orders. Provided that VIASPACE has complied with Sections 5.3 and 5.4, VGE shall accept and use its commercially
reasonable efforts (subject to Section 12.1 of this Agreement; e.g., the failure of GKG to grow in the winter months) to
fulfill the Purchase Orders for the quantities set forth in the Binding Forecast. In the event that VGE wishes to reject a Purchase
Order due to a failure by VIASPACE to comply with Sections 5.3 or 5.4, it shall notify VIASPACE of its decision to do so within
ten (10) Business Days after VGE’s receipt of the Purchase Order with an explanation of the reasons for the rejection.

 

5.6Purchase
Order Changes. If VIASPACE requests changes to any Purchase Order prior to the Pick Up Date of Giant King Grass, VGE will attempt
to accommodate such changes within its reasonable distribution capabilities and efficiencies. VGE shall advise VIASPACE of its
fully burdened costs associated with making any such change and VIASPACE shall be deemed to have accepted the obligation to pay
VGE for such costs if VIASPACE directs VGE in writing to proceed to make the change after receiving notice of such costs.

 

5.7Standard
Terms. It is understood that each Party may, for convenience, use its own standard pre-printed forms of the Purchase Orders,
acknowledgements, acceptances or invoices in the performance of its obligations hereunder; provided, however, that
any terms, conditions or provisions in such pre-printed forms which are inconsistent with or which modify or supplement this Agreement
shall be null and void.

 

5.8Invoicing
and Delivery of Giant King Grass. VGE shall invoice VIASPACE upon or as soon as reasonably practicable following its receipt
and acceptance of a Purchase Order for the Delivery of Giant King Grass. Except as otherwise provided in VGE’s invoice, VIASPACE
shall pay the invoiced amount in no event later than the Pick Up Date. Each order of Giant King Grass under a VIASPACE Purchase
Order may be picked up by VIASPACE after the Pick Up Date, but in no event prior to the date on which VIASPACE shall have paid
in full the invoiced amount, with Delivery being deemed accepted by VIASPACE upon and coincident with the Pick Up Date. Delivery
shall be made EXW (Incoterms 2010) at the Guangdong airport location for VIASPACE’s designated common carrier in the Peoples
Republic of China, with VGE having no responsibility to VIASPACE for any losses, damages, costs or expenses for or resulting from
Delivery on or after the Pick Up Date or for failure to Deliver or failure to timely Deliver Giant King Grass due to an event described
in Section 12.1 of this Agreement.

 

ARTICLE 6

PURCHASE PRICE, MILESTONE

AND

ROYALTY PAYMENTS

 

6.1Transaction
Legal Fees. VIASPACE shall pay to Sung Chang or his designee the Legal Fees not later than the date immediately preceding the
second anniversary of the Effective Date.

 

6.2Final Giant
King Grass Transfer Price.  VIASPACE shall pay to VGE on or before the Pick Up Date the per unit FPTP for the Giant King Grass
Delivered by VGE in accordance with each respective or applicable Purchase Order as provided in Article 5 above.

 

6.3Royalty Payments.
In consideration for the Commercial License, VIASPACE shall pay to VGE the royalties on its Net Sales of Giant King Grass as set
forth on that Exhibit “B,” entitled “Royalty Payments.”

 

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6.4Royalty Reports;
Payment Due Dates.

 

(a)In
General. VIASPACE shall maintain its customary form of records reasonably required, which records shall (i) be complete, true and
accurate in all material respects, (ii) reflect the computation of the amounts due and owing to VGE, on a country-by-country basis,
including, without limitation, the Royalty Report below, (iii) be in sufficient detail so as to enable VGE to confirm compliance
by VIASPACE of its obligations under this Agreement and (iv) be maintained for at least three (3) years after the end of each Contract
Year during the Term.

 

(b)Royalty
Report. In addition to the reports to be provided to VGE under Section 4.3 of this Agreement, VIASPACE shall provide VGE a non-binding
royalty estimate within fifteen (15) days after close of each calendar quarter. VIASPACE will provide to VGE, at the same time
as each royalty payment is made, a complete, true and accurate written report showing: (i) the gross sales made for purposes of
calculating Net Sales and the calculation of Net Sales determined from such gross sales for and during the applicable calendar
quarter period, along with any and all reductions from such gross sales; (ii) the calculation of the royalty due and payable for
such reporting period; (iv) the First Commercial Launch date(s) of the Product or Process in each country within the VIASPACE Territory;
and (v) any other information reasonably requested by VGE to verify the accuracy of the royalty payments hereunder.

 

(c)VGE’s
Right to Audit. VIASPACE shall, not more than one time per Contract Year, during normal business hours, permit auditors designated
by VGE, at VGE’s expense and upon thirty (30) days written notice, full rights of inspection and audit of VIASPACE’s
books, records and operations, including, without limitation, any and all of the manufacturing, sales and growing locations of
VIASPACE and any customer, affiliate, distributor or other such vendor thereof.

 

(d)Handling
of Underpayment. In the event that the audit contemplated in this paragraph reveals any underpayment, VIASPACE shall remit promptly,
but in no event later than thirty (30) days following the date on which any such audit results are presented to VIASPACE, to VGE
the amounts thereof, and if VIASPACE fails to remit payment within such 30 day period, VGE shall be permitted to pursue all legal
and equitable remedies available to it pursuant to this Agreement as well as all applicable laws. In the event that the underpayment
is more than five percent (5%) of the amount due for the period audited, VIASPACE shall also remit to VGE the entire reasonable
and documented cost of such audit.

 

6.5Payment Terms.
All payments to be made pursuant to this Agreement shall be made by VIASPACE to VGE in United States Dollars. All late payments
shall accrue interest from the date owing until paid in full at a rate equal to the lower of fifteen percent (15%) per annum or
the highest rate permitted by applicable law.

 

6.6Foreign Exchange.
With respect to Net Sales invoiced or expenses incurred in United States Dollars, the Net Sales or expense amounts and the amounts
due to VGE under this Agreement shall be expressed in United States Dollars. With respect to Net Sales invoiced or expenses incurred
in a currency other than United States Dollars, the Net Sales or expense shall be expressed in the currency in which such Net Sales
were invoiced or such expense was incurred, together with the United States Dollar equivalent, calculated using the average of
the spot rate on the first and last Business Days of the Calendar Quarter in which the Net Sales were made or the expense was incurred.
The 12:00 Noon Buying Rates, as certified by the NY Federal Reserve Bank (currently and historical rates can be found on their
website at www.ny.frb.org), shall be used as the source of spot rates.

 

    	Page 11

    	 

    
 

6.7Blocked Payments.
In the event that, by reason of applicable laws or regulations in any country, it becomes impossible or illegal for VIASPACE or
any Affiliate or sublicensee thereof, to transfer, or have transferred on its behalf, fees or other payments due to VGE under this
Agreement, VIASPACE shall promptly notify in writing VGE of the conditions preventing such transfer and such fees or other payments
shall be deposited in local currency in the relevant country to the credit of VGE in a recognized banking institution designated
by VGE or, if none is designated by VGE within a period of thirty (30) days, in a recognized banking institution selected
by VIASPACE or its Affiliate or sublicensee, as the case may be, and identified in a written notice delivered to VGE.

 

6.8Taxes.
Any federal, state, county or municipal sales or use tax, excise, customs charges, duties or similar charge, value-added tax or
any other tax assessment (other than that assessed against income), license, fee or other charge lawfully assessed or charged on
the Manufacture, sale or transportation of Giant King Grass sold to VIASPACE by VGE pursuant to this Agreement (“Taxes”)
shall be the responsibility of VIASPACE. Should VIASPACE be obligated by law to withhold any Taxes on payments made to VGE for
product invoiced under this Agreement, the payment due hereunder shall be increased such that after the withholding of the appropriate
amount, VGE receives the amount that would have been paid but for the Taxes withheld. VIASPACE shall pay all such Taxes in a timely
manner and promptly provide VGE with a receipt evidencing such payment. Should VGE be obligated to pay such Taxes, and such Taxes
were not satisfied by way of withholding, VIASPACE shall promptly reimburse VGE for such payment, in an amount such that after
the payment of the Taxes, VGE has received the same amount that it would have received had such Taxes not been payable. Such taxes
shall be reflected on the invoices as provided in the Article 5 of this Agreement.

 

ARTICLE 7

[Reserved.]

 

ARTICLE 8

INTELLECTUAL PROPERTY

 

8.1VGE’s
Ownership of Giant King Grass. As between the parties, VGE owns and shall retain all right,
title and interest in and to Giant King Grass, the VGE Tradename and the GKG IP and any and all other intellectual property relating
thereto, whether in or outside of the VIASPACE Territory, including any and all modifications, improvements and other Results relating
to Giant King Grass, whether created, invented or otherwise developed by VIASPACE or any Affiliate thereof or any director, employee,
contractor or agent of either VIASPACE or any such Affiliate thereof (the “VGE IP”). All registrations, trademarks,
domain names and other Intellectual Property right relating to VGE IP shall be registered in the name of VGE, and any VGE IP in
the name or possession of VIASPACE will immediately be assigned, transferred or returned to VGE as a condition to the Commercial
License.

 

8.2VGE Intellectual
Property. This Agreement, to include, without limitation the Commercial License, is a sublicense and, as such, is subject to
and expressly limited by the terms and conditions of the VGE License, that certain license, which itself is a sublicense, entered
into by and between IPA China and its licensor (the “Parent License”) and that certain
license entered into by and between the licensee under the Parent License and the original licensor (the “Grandparent License”),
and notwithstanding any provision of this Agreement to the contrary, VGE grants no right and makes no covenant to VIASPACE that
is broader than or otherwise exceeds the scope of rights and covenants granted to VGE under either (or both of) the Parent License
or Grandparent License, as the case may be. To the knowledge of VGE, no act or omission has occurred since the 30th day of July
2012 that would have a material adverse effect on the Parent License. VGE hereby agrees to use commercially reasonable efforts
to maintain the Parent License in accordance with its terms and condition.

 

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8.3Review of
Use. VGE shall have the right to review and approve in advance VIASPACE’s use of the VGE Tradename and GKG Tradename,
which approval shall not be unreasonably withheld, delayed or conditioned. VIASPACE shall make as soon as reasonably practicable
all changes to the usage of either the VGE Tradename or GKG Tradename on any documents and materials containing either such tradename
as reasonably requested by VGE.

 

8.4Inspection.
VGE shall have the right, at its expense, to inspect at reasonable times, either itself or through its duly authorized representatives,
all or any portion of VIASPACE’s books, records, properties and facilities, and advertising and marketing documents. To the
extent applicable, such inspection shall be made in accordance with Section 6.4 (c). VIASPACE agrees to cooperate fully with any
such inspection by VGE and make VIASPACE’s employees available to answer VGE’s questions as part of such inspection.

 

8.5VGE Intellectual
Property. VIASPACE shall promptly notify VGE of all VGE Intellectual Property of which it becomes aware. VIASPACE hereby assigns
and shall assign to VGE all of VIASPACE’s right, title and interest in and to the VGE Intellectual Property. VIASPACE shall
provide VGE with reasonable assistance, at VGE’s cost (except as set forth in this Section), to obtain, perfect and enforce
all rights, title and interest in the VGE Intellectual Property, including, without limitation, the execution of any patent applications
and assignment agreements as and to the extent VGE elects to obtain, perfect, prosecute or enforce any such applications and assignments.
In the event VGE is unable to secure VIASPACE’s signature on any document hereunder, VIASPACE designates and appoints VGE
and its duly authorized representatives as its agents and attorneys-in-fact to act for and on its behalf to execute such documents.
Consistent with the forgoing, VGE will be responsible for, at VGE’s sole election, cost and expense, the filing and prosecution
of any and all Intellectual Property Rights in the VIASPACE Territory with respect to Giant King Grass or any VGE IP.

 

8.6Notice, Enforcement
and Defense of Intellectual Property Infringement.  VIASPACE agrees to promptly notify VGE of any conflicting use or any suspected
act of infringement, passing-off or unfair competition involving the VGE Intellectual Property by any Third Party, or any allegations
that the sale or use of the VGE Intellectual Property within the VIASPACE Territory infringe upon the Intellectual Property Rights
of any Third Party, of which VIASPACE may become aware. VGE shall have the sole and exclusive right, at VGE’s sole discretion,
to prosecute, maintain and enforce all VGE IP and prosecute or defend any and all infringement actions against any Person infringing
Giant King Grass or any Intellectual Property right relating to the VGE IP, including, without limitation, to engage in any and
all court proceedings necessary to protect its rights in the VGE Intellectual Property or to settle any disputes involving such
unauthorized acts or such allegations relating thereto, with VGE retaining any and all recoveries; provided that if VGE fails to
enforce the GKG IP, then VIASPACE shall have, to the extent permitted under applicable law, the right and power, at its sole cost
and expense to do so. Further, VIASPACE agrees to fully cooperate with VGE at VGE’s request (and at VGE’s cost) to
help terminate such activities by Third Parties, but shall not, without the express written consent of VGE, engage in any court
proceedings against, enter into any settlement discussions with or in any other way attempt to terminate said activities by Third
Parties.

 

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ARTICLE 9

CONFIDENTIALITY

 

9.1Confidentiality.
Except as and to the extent related to the discharge of its duties and obligations under this Agreement, the Receiving Party agrees
that all Confidential Information disclosed by the Disclosing Party or any Affiliate thereof to VIASPACE hereunder shall be received
and maintained by the VIASPACE in strict confidence, shall not be used for any purpose whatsoever, and shall not be disclosed to
any Third Party (including, without limitation in connection with any publications, presentations or other disclosures) other than
its Designated Representatives for the Term of this Agreement and for a period of five (5) years following the termination or expiration
of this Agreement; except, however, that in the case of Confidential Information that otherwise constitutes a Trade
Secret, the Disclosing Party hereby agrees that it shall in no event disclose any such information to Third Parties other than
its Designated Representatives for the period during which any such information shall continue to constitute a trade secret under
applicable law.

 

9.2Return of
Confidential Information. The Receiving Party shall keep the Confidential Information owned or in which rights are held by
the Disclosing Party or any Affiliate thereof in appropriately secure locations. Upon the expiration or termination of this Agreement,
any and all such Confidential Information possessed in tangible form by the Receiving Party, shall, upon written request, be immediately
returned to the Disclosing Party (or destroyed if so requested) and not retained by the Receiving Party.

 

9.3Ancillary
Agreement. This Article 9 shall be construed as an agreement ancillary to the other provisions of this Agreement, and the existence
of any claim or cause of action of one party against the other, whether predicated on this Agreement or otherwise, shall not constitute
a defense to the enforcement of this Article.

 

ARTICLE 10

TERM; TERMINATION

 

10.1Term.
Unless sooner terminated as otherwise provided in this Agreement, the term of this Agreement shall:

 

(a)The
Initial Term. Commence on the Effective Date and shall continue in full force and effect until the second (2nd) anniversary
of the Effective Date (the “Initial Term”); and

 

(b)Renewal
Term. Subject to VIASPACE otherwise being in full compliance with this Agreement (including, without limitation, the timely payment
of any and all amounts due hereunder) prior to the delivery of any Notice of Renewal and the commencement of each then applicable
Renewal Term, this Agreement may be renewed on the same terms and conditions hereof:

 

(i)Provided that VIASPACE shall
have first satisfied the conditions for any such renewal as set forth in Exhibit “B” for each such applicable renewal,
VIASPACE shall have the option to renew the term of this Agreement for four (4) consecutive and subsequent terms, each being for
a two (2) year period (for a total of ten (10) years from the Effective Date assuming each renewal is elected)(each, a “Conditional
Renewal Term”) by providing written notice of its election to renew such term (each, a “Renewal Notice”) to VGE
at least three (3) months prior to the expiry of the then current Initial Term or Conditional Renewal Term, as the case may be;
and

 

    	Page 14

    	 

    
 

(ii)Provided it delivers a
Renewal Notice to VGE at least three (3) months prior to the expiry of the then Renewal Term, this Agreement shall automatically
renew on the same terms and conditions hereof for consecutive two (2) year periods thereafter without any further act on the part
of either Party (each, an “Evergreen Renewal Term”); provided, however, that in no event shall the term
of this Agreement be renewed for the succeeding Evergreen Renewal Term if and to the extent either Party delivers to the other
written notice of its intent to not so renew this Agreement (the “Notice of Nonrenewal”) at least sixty (60) days prior
to the end of any such Evergreen Renewal Term (as the case may be)(together, the Conditional Renewal Term and Evergreen Renewal
Term shall be referred to as the “Renewal Terms”); provided, further, that in no event shall either Party
have the right to deliver a Notice of Nonrenewal if and to the extent VIASPACE’s Net Sales exceed Five Million Dollars ($5,000,000)
during the first applicable Evergreen Renewal Term; Eight Million Dollars ($8,000,000) during the second applicable Evergreen Renewal
Term and Ten Million Dollars ($10,000,000) during the third and subsequent Evergreen Renewal Terms, and to the extent any such
Notice of Nonrenewal is delivered by VGE, the Commercial License shall convert to a nonexclusive license in those countries in
which VIASPACE is engaged actively in the commercialization of GKG.

 

10.2Grounds
for Termination.

 

(a)Termination
by Mutual Agreement. This agreement may be terminated by mutual written agreement of the Parties.

 

(b)Termination
For Cause. Either Party may terminate this Agreement for cause if the other party materially breaches this Agreement, which
breach is not cured to the reasonable satisfaction of the non-breaching party within thirty (30) days after written notice from
the non-breaching Party specifying the material breach; provided, however, that in the case of a breach of this Agreement
on account of any failure to pay timely by VIASPACE, the period for cure of any such breach shall be ten (10) days, with VIASPACE
having the right to cure any such payment default not more than once during any twelve (12) consecutive calendar monthly period.
Consistent with the foregoing, VGE shall have the right, in its sole and absolute discretion, to cease Delivery of any Giant King
Grass until VIASPACE has cured any such material breach for which it is given notice under this Agreement; provided, however,
that if and to the extent VIASPACE shall have fully paid for finished product that is the subject of an invoice, then VGE will
nevertheless Deliver such product in accordance with Article 5.

 

(c)Termination
for Insolvency. To the extent permitted by applicable laws, either Party may terminate this Agreement upon written notice to
the other Party on or after the occurrence of any of the following events: (i) the appointment of a trustee, receiver or custodian
for all or substantially all of the property of the other Party, which appointment is not dismissed within ninety (90) days, (ii)
the filing of a petition for relief in bankruptcy by the other Party on its own behalf, or the filing of any such petition against
the other Party if the proceeding is not dismissed or withdrawn within ninety (90) days thereafter, or (iii) insolvency, dissolution
or liquidation of or an assignment for the benefit of creditors by a Party.

 

(d)Termination
of Parent or Grandparent License. If by virtue of any termination of either the Parent License or Grandparent License, VGE is unable
to otherwise perform its material obligations hereunder, this Agreement may be terminated by either Party upon ten (10) days written
notice.

 

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10.3Consequences
of Termination.

 

(a)Termination
of Agreement. Upon any termination or other expiration of this Agreement, among other things, the Commercial License shall
terminate and VIASPACE shall forthwith terminate and cease its use of Giant King Grass and the VGE IP and any further Commercialization
of Giant King Grass in the VIASPACE Territory. Immediately upon any such termination or expiration, all rights of VIASPACE to the
VGE IP, including, without limitation, the Giant King Grass and GKG IP, along with any and all other Intellectual Property relating
thereto, shall terminate and revert to VGE.

 

(b)Conversion
To Nonexclusive License. In lieu of terminating this Agreement under Section 10.2(b) above, VGE may, in its sole discretion,
elect to convert this Agreement and the rights hereunder to a nonexclusive license for the remainder of the applicable Initial
Term or Renewal Term, in which event such nonexclusive license shall be subordinate to the grant thereafter by VGE of any rights
therein to a Third Party and the provisions of Section 2.3 of this Agreement shall upon and coincident therewith be and become
thereafter null and void as and to the extent otherwise applicable to VGE or any Affiliate thereof or any third party acting for
and on behalf of VGE or any such Affiliate.

 

(c)Return
of VGE Property. Promptly upon, but in no event later than 15 consecutive calendar days thereafter, the expiration or earlier
termination of this Agreement, VIASPACE, at VIASPACE’s sole cost and expense, shall transfer, assign and otherwise deliver
unconditionally and irrevocably to VGE all of the GKG IP, including, without limitation, the GKG Tradename, and any and all books,
records, reports, files, documents and other information relating thereto, and the VGE IP and any and all other VGE property relating
to Giant King Grass and the Commercialization thereof. VIASPACE acknowledges and agrees that all rights, title and interest in
and to the foregoing shall remain exclusively with VGE following termination of this Agreement.

 

(d)Reports.
VIASPACE shall render an accounting to VGE of any royalties and other payments that may be due to VGE under the terms of this Agreement.

 

(e)Sublicenses
of Licensed Technology. Upon the expiration or earlier termination of this Agreement, any and all sublicenses, if any, granted
under this Agreement shall terminate except as and to the extent expressly permitted otherwise thereunder.

 

(f)Bankruptcy
or Termination for Cause. In the event this Agreement is properly terminated under Section 10.2 above by (i) VIASPACE account
of either (1) a material uncured default on the part of VGE pursuant to Section 10.2(b) of this Agreement, or (2) Bankruptcy on
the part of VGE or (ii) either party pursuant to Section 10.2(d) of this Agreement, then and in either such case, the obligations
of Section 2.2(a) as and to the extent the same shall relate to a Competing Product shall terminate upon and coincident with the
effective date of any such termination.

 

10.4Survival.
The following Articles and Sections of this Agreement shall survive termination or expiration of this Agreement: Sections 2.2,
4.3 and Articles 3, 5, 6, 8, 9, 10, 11 and 12 and any other provision which by its nature would continue past such expiration or
termination.

 

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ARTICLE 11

REPRESENTATIONS AND WARRANTIES;

INDEMNIFICATION; LIMITATION ON LIABILITY

 

11.1Compliance
with Laws. VIASPACE shall comply in all material respects with all laws, regulations and standards applicable to the Commercialization
of Giant King Grass, including, without limitation, the handling, storage, marketing, distribution and sale thereof, in the VIASPACE
Territory. VGE shall comply in all material respects with all applicable laws regulating the Manufacture GKG under this Agreement.
VGE shall not, and it shall cause its Affiliates and sublicensee, if any, to not, do anything that would materially adversely affect
the reputation of Giant King Grass within the VGE Territory.

 

11.2VGE
Representations and Warranties. As of the Effective Date, VGE makes the following representations and warranties to VIASPACE:

 

(a)Status.
VGE is a corporation duly organized and validly existing under the laws of the British Virgin Islands. No action has been taken
by the directors, officers or stockholders of VGE to dissolve VGE. VGE has the corporate power and authority to enter into this
Agreement and to perform all its obligations hereunder.

 

(b)All
Necessary Proceedings. VGE has taken all necessary corporate actions and proceedings to enable it to enter into this Agreement.

 

(c)No
Violation. Subject to Section 8.2 of this Agreement, the execution, delivery and performance of this Agreement by VGE: (i)
does not and will not violate or conflict with, in any material respect, any applicable law or any provision of its certificate
of incorporation or bylaws; and (ii) does not and will not, in any material respect, with or without the passage of time or the
giving of notice, result in the breach of, or constitute a default under, any agreement or obligation between it and any Third
Party.

 

11.3VIASPACE
Representations and Warranties. As of the Effective Date, VIASPACE makes the following representations and warranties to VGE:

 

(a)Status.
VIASPACE is a corporation duly organized and validly existing under the laws of the State of Nevada. No action has been taken by
the directors, officers or shareholders of VIASPACE to dissolve VIASPACE. VIASPACE has the corporate power to enter into this Agreement
and to perform all its obligations hereunder.

 

(b)All
Necessary Proceedings. VIASPACE has taken all necessary corporate actions and proceedings to enable it to enter into this Agreement.

 

(c)No
Violation. The execution, delivery and performance of this Agreement by VIASPACE: (i) does not and will not violate or conflict
with, in any material respect, applicable law, or any provision of its articles of incorporation or by-laws; and (ii) does not
and will not, with or without the passage of time or the giving of notice, result in the breach of, or constitute a default under,
or result in the creation of any lien, charge or encumbrance upon any of Giant King Grass or its property or assets pursuant to
any agreement or obligation between it and any Third Party.

 

(d)Compliance.
VIASPACE has and shall continue to comply with all applicable laws relating to Commercialization, including, without limitation,
to the handling, storage, distribution and sale, of Giant King Grass in the VIASPACE Territory. VIASPACE shall not, and it shall
cause its Affiliates and sublicensee, if any, to not, do anything that would materially adversely affect the reputation and goodwill
of VGE or of VGE’s Affiliates or materially adversely affect the reputation of Giant King Grass or the VGE Tradename.

 

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11.4Indemnification
by VIASPACE. VIASPACE shall indemnify and hold harmless VGE and each of its Affiliates and each director, officer, employee,
agent, successor and assign of VGE and each such Affiliate (collectively, the “VGE Indemnified Parties”), from, against
and in respect of any and all Actions and any liabilities, losses, costs (including costs of investigation, defense and enforcement
of this Agreement), damages, fines, penalties, expenses or amounts paid in settlement (in each case, including reasonably and actually
incurred attorneys' and experts fees and expenses) of any such Actions asserted by a Third Party against any of the VGE Indemnified
Parties as a result of, arising out of or relating to, directly or indirectly, any one or all of the following: (i) Giant King
Grass, including, without limitation, the manufacturing, supply, marketing, sale, distribution or other Commercialization of any
Product, Improvement or Process thereof; (ii) any breach of, or inaccuracy in, any representation or warranty made by VIASPACE
under this Agreement; or (iii) any breach or violation of any covenant or agreement by VIASPACE or other VIASPACE Indemnified Party
(including under this Section) under or pursuant to this Agreement.

 

11.5Indemnification
by VGE. VGE shall indemnify and hold harmless VIASPACE and each of its Affiliates and each director, officer, employee, agent,
successor and assign thereof (collectively, the “VIASPACE Indemnified Parties”), from, against and in respect of any
and all Actions and any liabilities, losses, costs (including costs of investigation, defense and enforcement of this Agreement),
damages, fines, penalties, expenses or amounts paid in settlement (in each case, including reasonably and actually incurred attorneys'
and experts fees and expenses) of any such Actions asserted by a Third Party against any of the VIASPACE Indemnified Parties as
a result of, arising out of or relating to, directly or indirectly, any one or all of the following: (i) any breach of, or inaccuracy
in, any representation or warranty made by VGE in this Agreement; or (ii) any material breach or violation of any covenant or agreement
of VGE or other VGE Indemnified Party (including under this Section) under or pursuant to this Agreement.

 

11.6Indemnification
Claims.

 

(a)A
person entitled to indemnification under this Section (an “Indemnified Party”) shall give prompt written notification
to the person from whom indemnification is sought (the “Indemnifying Party”) of the commencement of any action, suit
or proceeding relating to a Third Party claim for which indemnification may be sought or, if earlier, upon the assertion of any
such claim by a Third Party (it being understood and agreed, however, that the failure by an Indemnified Party to give notice of
a Third Party claim as provided in this Section shall not relieve the Indemnifying Party of its indemnification obligation under
this Agreement except and only to the extent that such Indemnifying Party is actually prejudiced as a result of such failure to
give notice).

 

(b)Within
thirty (30) days after delivery of such notification, the Indemnifying Party may, upon written notice thereof to the Indemnified
Party, assume control of the defense of such action, suit, proceeding or claim. If the Indemnifying Party does not assume control
of such defense, the Indemnified Party shall control such defense.

 

(c)The
Party not controlling such defense may participate therein at its own expense; provided, however, that if the Indemnifying
Party assumes control of such defense and the Indemnified Party reasonably concludes, based on advice from counsel, that the Indemnifying
Party and the Indemnified Party have conflicting interests with respect to such action, suit, proceeding or claim, the Indemnifying
Party shall be responsible for the reasonable fees and expenses of counsel to the Indemnified Party solely in connection therewith;
provided, further, that in no event shall the Indemnifying Party be responsible for the fees and expenses of more
than one counsel in any one jurisdiction for all Indemnified Parties.

 

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(d)The
Party controlling such defense shall keep the other Party advised of the status of such action, suit, proceeding or claim and the
defense thereof and shall consider recommendations made by the other Party with respect thereto.

 

(e)The
Indemnified Party shall not agree to any settlement of such action, suit, proceeding or claim without the prior written consent
of the Indemnifying Party, which consent shall not be unreasonably withheld, delayed, denied or conditioned. The Indemnifying Party
shall not agree to any settlement of such action, suit, proceeding or claim or consent to any judgment in respect thereof that
does not include a complete and unconditional release of the Indemnified Party from all liability with respect thereto or that
imposes any liability or obligation on the Indemnified Party without the prior written consent of the Indemnified Party.

 

11.7Insurance.
Each Party shall, at its sole cost and expense, obtain and keep in force for the duration of this Agreement general liability insurance.
Upon written request, each Party shall furnish to the other Party a certificate of insurance signed by an authorized representative
of such Party’s insurance underwriter evidencing the insurance coverage required by this Agreement and providing, to the
extent feasible, for at least thirty (30) days’ prior written notice to the other Party of any cancellation, termination,
material change or reduction of such insurance coverage.

 

11.8Disclaimers.
EXCEPT AS EXPRESSLY WARRANTED IN THIS AGREEMENT, INCLUDING THIS ARTICLE, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES
WITH RESPECT TO THE PRODUCTSS, EXPRESS OR IMPLIED, IN ANY MANNER AND EITHER IN FACT OR BY OPERATION OF LAW, AND SPECIFICALLY DISCLAIMS
ANY AND ALL IMPLIED OR STATUTORY WARRANTIES, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, COURSE OF DEALING, COURSE OF PERFORMANCE, USAGE OF TRADE OR NONINFRINGEMENT. Without limiting the foregoing, both Parties
acknowledge that they have not and are not relying upon any implied warranty of any kind or upon any representation or warranty
except as expressly warranted in this Agreement.

 

11.9Limitation
on Liability. EXCEPT TO THE EXTENT ARISING OUT OF ANY (a) VIOLATION OF THE OTHER PARTY’S INTELLECTUAL PROPERTY RIGHTS,
(b) CRIMINAL VIOLATION OF APPLICABLE LAWS, (c) GROSS NEGLIGENCE, FRAUD OR INTENTIONAL OR WILFUL MISCONDUCT (d) OR DISCLOSURE OF
CONFIDENTIAL INFORMATION IN BREACH OF THIS AGREEMENT, NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR EXEMPLARY, INCIDENTAL, INDIRECT,
PUNITIVE, CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY TYPE OR AMOUNT (INCLUDING, WITHOUT LIMITATION, LOST PROFITS) ARISING OUT OF ITS
BREACH OF ANY PROVISION IN THIS AGREEMENT (INCLUDING WITHOUT LIMITATION, THE PERFORMANCE OR FAILURE TO PERFORM HEREUNDER), EVEN
IF SUCH DAMAGES WERE FORESEEABLE AND WHETHER SUCH DAMAGES ARISE IN TORT, IN CONTRACT OR OTHERWISE. VGE’S AGGREGATE LIABILITY
TO VIASPACE ARISING FROM THIS AGREEMENT, WHETHER IN CONTRACT OR TORT, WILL NOT EXCEED THE AMOUNTS PAID BY VIASPACE FOR THE PURCHASE
OF PRODUCTS THAT IT IS UNABLE TO SELL WITHIN THE TERRITORY.

 

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ARTICLE 12

MISCELLANEOUS

 

12.1Force Majeure.
Other than the performance obligations under Articles 6 and 9 and Section 12.14 of this Agreement, any delay in the performance
of any of the duties or obligations of either Party shall not be considered a breach of this Agreement and the time required for
performance shall be extended for a period equal to the period of such delay, provided that such delay has been caused by or is
the result of any (a) acts of a public enemy, insurrections, riots, embargoes, failures or delays by vendors, labor disputes, including
strikes, lockouts, job actions, boycotts, fires, explosions, floods, shortages of material or energy so long as all such acts are
without the fault or negligence of and beyond the reasonable control of the Party claiming such excuse from performance or (b)
acts of God. The Party claiming any such excuse shall give prompt notice to the other Party of such cause, and shall promptly take
whatever reasonable steps are necessary to relieve the effect of such cause.

 

12.2Notices.
All notices hereunder shall be delivered as follows: (a) by facsimile and confirmed by first class mail (postage prepaid); (b)
by registered or certified mail (postage prepaid); or (c) by overnight courier service, to the following addresses of the respective
Parties:

 

	 	
        If to VIASPACE, to:

         

        VIASPACE, Inc.

        382 N. Lemon Ave., Suite 364

        Walnut, CA 91789

        Telephone: 626-768-3360

        Facsimile: 626-578-9063

         

         

        With a copy to:

         

        LKP Global Law LLP

        1901 Avenue of the Stars, Suite 480

        Los Angeles, CA 90067

        Telephone: 424-239-1890

        Facsimile: 424-239-1882

        Attn: Ryan Hong
	
        If to VGE, to:

         

        VIASPACE Green Energy, Inc.

        Mr. Sung Chang

        131 Bells Ferry Lane

        Marietta, Georgia 30066

        ATTN: President

        

        

        

        With a copy to:

         

        McDaniel Law Group, PC

        P.O. Box 681235

        Marietta, Georgia 30068

        Attn: Mr. Frank McDaniel, Esq.

 

 Notices shall be effective upon
receipt if delivered personally or by facsimile and confirmed by first class mail, on the third Business Day following the date
of registered or certified mailing or on the first Business Day following the date of delivery to the overnight courier. A Party
may change its address listed above by written notice to the other Party.

 

12.3Governing
Law.  The laws of the State of Georgia, United States of America shall govern this Agreement; except, however,
that with respect to any dispute that may arise under this Agreement in connection with a Party’s Intellectual Property Rights,
including, without limitation, the enforceability of restrictive covenants with respect thereto, such dispute shall to the extent
it may be otherwise governed by the laws of the various states, shall in such a case be governed by the laws of the State of Georgia,
disregarding such states’ conflict of law provisions. The Parties disclaim application of the United Nations Convention on
Contracts for the International Sale of Goods.

 

    	Page 20

    	 

    
 

12.4Alternative
Dispute Resolution. Both Parties will attempt to settle any claim arising out of this Agreement through good-faith negotiation.
The following process will be used to resolve disputes. The Parties will submit the dispute in writing to a senior executive from
each Party. If those attempts fail, either Party may demand non-binding mediation, the cost of which will be shared equally by
the Parties, except that each Party will pay its own attorney’s fees. Within thirty (30) days after written notice demanding
mediation, the Parties will in good faith choose a mutually acceptable mediator. If the dispute cannot be resolved through mediation
within ninety days, either Party may submit the dispute to a court of competent jurisdiction. Use of any dispute resolution procedure
will not be construed under the doctrines of laches, waiver, or estoppel to adversely affect the rights of either Party. Either
Party may resort to judicial proceedings for intellectual property disputes or if interim relief is necessary to prevent serious
and irreparable injury.

 

12.5Venue and
Jurisdiction. The transactions contemplated in this Security Agreement shall be governed as to validity, interpretation, construction,
effect, and in all other respects by the laws of the State of Georgia, without regard to the conflicts of laws principals thereof.
Each of the Parties irrevocably submits to the exclusive jurisdiction of the courts of the State of Georgia located in the County
of Cobb and the United States District Court in and for the Northern District of Georgia for the purpose of any suit, action, proceeding
or judgment relating to or arising out of this Agreement and the transactions contemplated thereby. Each Party irrevocably consents
to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court, irrevocably
waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts, and irrevocably waives
any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

 

12.6Waiver of
Jury Trial. EACH PARTY HERETO WAIVES ITS RIGHT TO TRIAL OF ANY ISSUE BY JURY.

 

12.7Claim for
Attorneys Fees In the event any attorney is employed by any Party to this Agreement with regard to any legal action, arbitration
or other proceeding brought by any Party to this Agreement for the enforcement of this Agreement or because of an alleged dispute,
breach, default or misrepresentation in connection with any of the provisions of this Agreement, then the prevailing Party, whether
at trial or upon appeal, and in addition to any other relief to which the prevailing Party may be granted, shall be entitled to
recover from the losing Party all costs, expenses, and a reasonable sum for attorney fees incurred by the prevailing Party in bringing
or defending such action, arbitration, or proceeding, and in enforcing any judgment granted therein, all of which costs, expenses
and attorneys fees shall be deemed to have accrued upon the commencement of such action and shall be paid whether or not such action
is prosecuted to judgment. Any judgment or order entered in such matter shall contain a specific provision providing for the recovery
by the prevailing Party of attorney fees, costs, and expenses incurred in enforcing such judgment. For purposes of this Section,
attorney fees shall include, without limitation, fees incurred in the following: post-judgment motions; contempt proceedings; garnishment,
levy, and debtor and third Party examinations; discovery; and bankruptcy litigation.

 

12.8Assignment.
Neither this Agreement nor any of the rights or obligations of VIASPACE may be assigned, encumbered, sublicensed or otherwise transferred
by VIASPACE, without the prior written consent of VGE, in its discretion; provided, however, that VIASPACE, without
such consent, may assign this Agreement in connection with the transfer or sale of substantially all of its business or assets
to which this Agreement pertains or in the event of its merger or consolidation with another company, except, however,
that in no event shall this Agreement to assigned to any Person who is engaged in business activities involving any Competitive
Product. Any permitted assignee of VIASPACE shall assume all obligations of VIASPACE under this Agreement. No assignment shall
relieve VIASPACE of responsibility for the performance of any accrued obligation which VIASPACE then has hereunder. Any attempted
assignment in violation of this provision is void. This Agreement may be assigned by VGE in its sole discretion without prior notice.

 

    	Page 21

    	 

    
 

12.9Successors.
This Agreement and the provisions hereof shall inure to the benefit of and be binding upon each Party and its successors and assigns.

 

12.10Entire
Agreement; Amendments. Unless the Parties otherwise agree in writing, this Agreement and the attached Exhibits represent the
Parties’ entire understanding, and supersede all previous and contemporaneous agreements between the Parties, with respect
to the subject matter contained herein. Each attached Exhibit is incorporated into this Agreement by reference. There are no promises,
terms or conditions, oral or written, expressed or implied, other than those contained in this Agreement and/or the attached Exhibits.
Except as expressly provided in this Agreement, this Agreement and each Exhibit may be modified or amended only by the Parties’
written agreement.

 

12.11Exhibits.
All Exhibits or descriptions referred to in this Agreement are expressly incorporated herein by reference and set forth in full,
whether or not attached hereto.

 

12.12Waiver;
Severability. No delay or waiver (or single or partial exercise) on the part of either Party on any one or more occasions in
exercising any right, power or privilege hereunder shall operate as a waiver thereof or of any other right, power or privilege
hereunder. Any such waiver shall be made in writing. If any provision of this Agreement or any Exhibit is held to be invalid or
unenforceable to any extent, then: (a) such provision shall be interpreted, construed or reformed to the extent reasonably required
to render it valid, enforceable and consistent with the Parties’ original intent underlying such provision and (b) such invalidity
or unenforceability shall not affect any other provision of this Agreement or any other agreement between the Parties.

 

12.13Equitable
Relief. Each party hereby acknowledges that its breach of this Agreement would cause irreparable harm and significant injury
to the other party that may be difficult to ascertain and that a remedy at law would be inadequate. Accordingly, each party shall
have the right to seek and obtain injunctive relief to enforce obligations under the Agreement in addition to any other rights
and remedies it may have, with the defending Party in such case waiving the right it may otherwise have to requiring the posting
of a bond; provided, however, each party, shall have the right to immediately seek and obtain injunctive relief without any written
notice to the other party or if such breach is of a nature that is not subject to cure or is otherwise based on any violation of
applicable law or a breach of any covenant pursuant to which a Party agrees to refrain from any act under this Agreement, including,
without limitation, Article 2, 9 or Section 12.15 of this Agreement.

 

12.14Independent
Contractor. The Parties are independent contractors and nothing contained in this Agreement shall be construed to place them
in the relationship of partners, principal and agent, employer/employee or joint venturer. Neither Party shall have power or right
to bind or obligate the other, nor hold itself out as having such authority.

 

12.15No Third
Party Beneficiaries. This Agreement is not intended to confer upon any person other than the Parties hereto any rights or remedies
hereunder; provided, however, that Sung Chang or his designee shall be a third party beneficiary under this Agreement
for purposes of the right and enforcement thereof the to be paid timely by VIASPACE the Legal Fees as set forth in Section 6.1
of this Agreement.

 

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12.16Restrictive
Covenant. Neither Party (nor any of its Affiliates) shall, except with the prior written consent of the other, during the Term
and for a period of two (2) years thereafter, solicit, employ or hire any employee then employed by the other Party, or any employee
that has been in the other Party’s employ ninety (90) days prior to the date of expiration or termination of this Agreement.

 

12.17Construction;
Headings. This Agreement and all attached Exhibits shall be deemed to have been drafted by both Parties and shall not be construed
against either Party as the draftsperson hereof. All section titles or headings contained in this Agreement and any Exhibit are
for convenience only, shall not be deemed a part hereof or thereof and shall not affect the meaning or interpretation of this Agreement
or any Exhibit. In this Agreement, the words “including” and “includes” shall be deemed to be followed
by the phrase “without limitation.”

 

12.18Counterparts.
This Agreement and any amendment hereto, may be executed in multiple counterparts, each of which shall be deemed an original Agreement,
and all of which shall constitute a single Agreement, by and among each of the Parties hereto.

 

IN WITNESS WHEREOF,
the Parties have executed this Agreement as of the Effective Date.

 

	
        VIASPACE

         

        VIASPACE Inc.

         

        By:___/s/ Carl Kukkonen___

        Name: Carl Kukkonen

        Title: CEO
	
        VGE

         

        VIASPACE Green Energy, Inc.

 

        By:__/s/ Sung Chang_______

        Name: Sung Chang

        Title: President

         

         

 

 

    	Page 23

    	 

    

 

EXHIBIT “A”

 

VIASPACE, INC.

BUSINESS PROTECTION AGREEMENT

WITH [EMPLOYEE][CONSULTANT]

 

THIS BUSINESS PROTECTION
AGREEMENT (the “Agreement”) is made and entered into as of the __ day of September 2012 (the “Effective Date”),
by and between VIASPACE, Inc., a Nevada corporation doing business within the State of [____] (the “Company”) and [_____________],
an individual residing in the State of [______] (“[Consultant][Employee]”). Company and [Consultant][Employee] are
sometimes individually referred to in this Agreement as a “Party” and collectively as the “Parties.”

 

Each of the Parties hereby acknowledges
that it has entered into, is entering into or as soon as reasonably practicable will enter into [a consulting or other independent
contractor relationship][an employment relationship], pursuant to which [Consultant][Employee] will be engaged by Company to render
certain services for and on behalf of Company and its Affiliate (the “[Consulting][Employment] Relationship”). Except
as otherwise provided in this Agreement, (a) the terms and conditions for such [Consulting][Employment] Relationship (e.g.,
scope of services, compensation and the duration for which such services shall be rendered) are to be evidenced in a separate agreement,
whether oral or in writing (the “Services Agreement”) and (b) capitalized terms and phrases shall have the meaning
ascribed thereto in that certain attachment entitled “Attachment 1, Definitions,” which attachment is made a part hereof
and incorporated herein.

 

In consideration of the benefits each Party
is to receive or receives as a result of the [Consulting][Employment] Relationship, the sum of One Dollar ($1.00) and other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally
bound by this Agreement, hereto hereby agree as follows:

 

1.Restrictive
Covenants.

 

(a)Nondisclosure.

 

(i)In
General. [Consultant][Employee] acknowledges that it may be exposed to certain Confidential Information and Trade Secrets and the
Intellectual Property Rights thereto during the Term, and its unauthorized use or disclosure of such information, data or rights
could cause immediate and irreparable harm to Company or an Affiliate or a Business Client thereof. Accordingly, except to the
extent that it is required to use such property, information, technology or data to perform its obligations under the [Consulting][Employment]
Relationship, [Consultant][Employee] agrees [and agrees to cause its Designated Representatives (as defined below)] to strictly
maintain the confidentiality, including, without limitation, to refrain, directly or indirectly, from releasing, publishing, revealing
or otherwise disclosing to any other Person, any and all such Confidential Information during the Term and for a period of (1)
in the case of Confidential Information, [five (5)] years immediately thereafter and (2) in the case of Trade Secrets, for the
entire period during which, if longer than five years, such information shall continue constitute a Trade Secret, without the express
and duly authorized written consent of Company, which consent may be withheld, delayed, denied or conditioned in Company’s
sole and absolute discretion.

 

    	Page 24

    	 

    
 

(ii)[Consultant
Disclosure to Designated Representatives. Without limiting the generality of the foregoing, Consultant may disclose the Confidential
Information to only (1)(A) its directors, officers or employees who prior to any such disclosure shall have agreed in writing to
the terms and conditions of this Agreement (or are otherwise obligated to be subject to such terms and conditions), pursuant to
which, among other things, such Persons have agreed to both maintain such Confidential Information in strict confidence and exclusively
use such Confidential Information solely for the Consulting Relationship and (B) agents who are obligated to Consultant under fiduciary
standards of confidentiality (i.e., attorneys, licensed accountants and CPA’s)(collectively, the “Designated
Representatives”) and (2) who are thereafter provided such Confidential Information only on a “need-to-know”
basis for the [Consulting][Employment] Relationship. Consultant agrees to and shall be responsible for any breach of this Agreement
by itself or any Person to whom it may have made a disclosure of the Confidential Information of Company or an Affiliate, including,
without limitation, any of its Designated Representatives.]

 

(iii)Exception
to Confidentiality Obligation. The confidentiality obligations hereunder shall not apply to information that can be demonstrated
by [Consultant][Employee] to:

 

(1)Have
been developed independently of Company or any Affiliate by or known to [Consultant][Employee] prior to the earlier of (1) the
Effective Date of this Agreement or (2) the [Consulting][Employment] Relationship, and not otherwise assigned, transferred or otherwise
conveyed to Company or any Affiliate under this Agreement or any other agreement;

 

(2)Have
been rightfully received by [Consultant][Employee] in accordance with this Agreement after disclosure to Company by a third party
who did not require Company or any Affiliate or [Consultant][Employee] to hold it in confidence or limit its use and who did not
acquire it, directly or indirectly, from the Company or any Affiliate under a continuing obligation of confidence; or

 

(3)Have
been in the public domain as of the date of this Agreement, or comes into the public domain during the term of this Agreement through
no fault of [Consultant][Employee].

 

(iv)Procedure
for Compelled Disclosure. In the event Consultant or its Designated Representatives are legally required or compelled by law, regulation
or other legal process to disclose any of the Confidential Information of Company or an Affiliate, Consultant shall and shall cause
its Designated Representative to: (1) provide prompt prior written notice of such requirement to Company, (2) afford Company an
opportunity to oppose, limit or secure confidential treatment for such disclosure, and (3) if Company is unsuccessful in its efforts
pursuant to clause (2), furnish only that portion of the Confidential Information, which it is legally required to disclose as
advised by its legal counsel.]

 

(b)Limitations
on Use. Except to the extent it is otherwise required to use the Intellectual Property of Company or any Affiliate in the performance
of its obligations under the [Consulting][Employment] Relationship, [Consultant][Employee], directly or indirectly, shall not and
shall not attempt to, use or modify for use or otherwise reverse engineer or decompile, for any purpose whatsoever or for any Person
any of the Intellectual Property (including, without limitation, any process, procedure, software, hardware, firmware or other
technology programs) of Company or any Affiliate during the Term of this Agreement or at any time thereafter, without the express
and duly authorized written consent of Company, which consent may be withheld, delayed, denied or conditioned in Company’s
sole and absolute discretion. As between the Parties, [Consultant][Employee] further agrees that any and all Intellectual Property
of Company or any Affiliate shall remain the sole and exclusive property of Company, and [Consultant][Employee] shall not have
or acquire any ownership or other interest or rights therein.

 

    	Page 25

    	 

    
 

(c)Limitation
on Solicitation of Business Clients and Personnel. Without the prior written consent of Company, which consent may be withheld,
delayed, denied or conditioned in Company’s sole and absolute discretion, [Consultant][Employee] shall not, directly or indirectly,
alone or in conjunction with any other Person, during the Term and for a period of two (2) years immediately thereafter:

 

(i)Solicit
any Business Client (1) to which Company or any Affiliate is providing or actively seeking to provide services or products and
(2)(A) with whom or which [Consultant][Employee] had material contact during the Term or (B) with respect to whom or which [Consultant][Employee]
was provided Confidential Information or Trade Secrets by Company or any Affiliate during the Term, for the purpose of providing
such Business Client products or services that are substantially similar to or competitive with the Restricted Business;

 

(ii)Solicit
any Business Partner with whom or which [Consultant][Employee] had material contact during the Term or with respect to whom or
which [Consultant][Employee] was provided Confidential Information or Trade Secrets by Company or any Affiliate during the Term,
for the purpose of encouraging such Person to sever its employment or other contractual relationship, whether oral or written,
with Company or an Affiliate, or

 

(iii)Hire,
engage or otherwise retain (1) an Company Service Partner or (2) any Person who was an Company Service Partner within that six
(6) consecutive calendar month period immediately preceding the Termination Date, to perform services of a nature substantially
similar to that which such Company Service Partner performed for Company or any Affiliate within that one (1) year period prior
to any such hiring, engagement or other retention or attempted hiring, engagement or other retention by [Consultant][Employee].

 

(d)Non-Disparagement.
During the Term and for a period of two (2) years immediately following the Termination Date, [Consultant][Employee] shall not
engage in the public or private disparagement or criticism, including, without limitation, by way of preparing or publishing (or
both) articles or other written materials, of or about Company or any Affiliate or any business methods, practice, operation, program,
product or service or any officer, director, employee, consultant, or agent thereof.

 

(e)Duty to Provide
Notice. Company or any Affiliate shall have the right to inform any other third-party that Company or any such Affiliate believes
that such third party to be contemplating or participating with [Consultant][Employee] in the use of or receiving from [Consultant][Employee]
services or information in violation of this Agreement or the rights of Company or any Affiliate hereunder, and that participation
by any such third-party with [Consultant][Employee] in activities in violation of this Agreement may give rise to claims by Company
or an Affiliate against such third-party.

 

2.  Assignment of
Work Product.

 

(a)Work for
Hire. [Consultant][Employee] further acknowledges that all original works of authorship that are made by it (solely or jointly
with others) during the Term and within the scope of the [Consulting][Employment] Relationship shall constitute, as between the
Parties, the sole and exclusive property of Company and protectable by it under applicable copyright laws. As between the Parties,
Company owns and shall own, and [Consultant][Employee] hereby agrees to assign and assigns to Company any and all of such Work
Product to the fullest extent allowable by law, and [Consultant][Employee] shall promptly disclose, but in no event later than
ten (10) consecutive business days following creation, invention or discovery thereof, all such Work Product to Company. In no
event shall [Consultant][Employee] use in connection with the [Consulting][Employment] Relationship or otherwise disclose to Company
or any Affiliate or any Business Partner all or any part of the confidential information, trade secrets or Intellectual Property
owned or in which rights are held to the exclusion of Company by either [Consultant][Employee] (including, without limitation,
the Excluded Property) or any third-party, without the prior written consent of Company, which consent may be withheld, delayed,
denied or conditioned in its sole and absolute discretion.

 

    	Page 26

    	 

    
 

(b)Moral Rights.
To the extent [Consultant][Employee] retains any Moral Rights in and to any Work Product, [Consultant][Employee] hereby waives
such Moral Rights and consents to any action with respect to such Moral Rights by or authorized by Company or any Affiliate and
specifically grants to Company or any Affiliate the right to alter such Work Products. [Consultant][Employee] will confirm any
such waivers and consents from time to time as requested by Company or any Affiliate.

 

3.Assistance in Securing Intellectual
Property Rights. 

 

(a)In General.
[Consultant][Employee] will assist Company or any Affiliate (or both) in every proper way to obtain and from time to time enforce
United States and foreign Intellectual Property Rights relating to Work Product in any and all countries. To that end, [Consultant][Employee]
will execute, verify, and deliver such documents and perform such other acts (including appearances as a witness) as Company or
any Affiliate may reasonably request for use in applying for, obtaining, perfecting, evidencing, sustaining, and enforcing such
Intellectual Property Rights and the assignment thereof. In addition, upon the request of Company or any Affiliate, [Consultant][Employee]
shall execute, verify, and deliver assignments of such Intellectual Property Rights to Company or its designee. [Consultant][Employee]’s
obligation to assist Company or any Affiliate (or both) with respect to Intellectual Property Rights relating to such Work Product
in any and all countries shall continue beyond the Termination Date.

 

(b)Limited Power
of Attorney. In the event Company or any Affiliate is unable for any reason, after reasonable effort, to secure [Consultant][Employee]’s
signature on any document needed in connection with the actions specified in the preceding paragraph, [Consultant][Employee] hereby
irrevocably designates and appoints Company and its duly authorized officers and agents as its agent and attorney in fact, coupled
with an interest, to act for and on its behalf to execute, verify, and file any such documents and to do all other lawfully permitted
acts to further the purposes of the preceding paragraph thereon with the same legal force and effect as if executed by [Consultant][Employee]
.. [Consultant][Employee] hereby waives and quitclaims to Company any and all claims, of any nature whatsoever, that [Consultant][Employee]
now or may hereafter have for infringement of any Intellectual Property Rights assigned hereunder to Company.

 

4.No Conflicting Obligation.
[Consultant][Employee] represents that its performance of its obligations under this Agreement and under the [Consulting][Employment]
Relationship does not and will not breach any agreement between it and any other Person. [Consultant][Employee] has not entered
into, and it agrees it will not enter into, any agreement either written or oral in conflict herewith. [Consultant][Employee] shall,
during the Term of the [Consulting][Employment] Relationship, diligently promote the interests of Company and each Affiliate. [Consultant][Employee]
shall serve Company and each Affiliate to the best of its ability, faithfully, honestly, diligently, efficiently and professionally
and in compliance with any and all applicable rules, regulations and laws.

 

    	Page 27

    	 

    
 

5.Company Property. Upon
the earlier to occur of any request by Company or any Affiliate (or both) or the Termination Date, [Consultant][Employee] shall
promptly deliver, but in no event later than ten (10) consecutive business days, to Company all drawings, Work Product and other
Intellectual Property owned by or in which rights are held by Company or any Affiliate (and regardless of whether any of the foregoing
is kept in physical or electronic form), including, without limitation, any Confidential Information and Trade Secrets. [Consultant][Employee]
further agrees that it has no right in or to any property owned, licensed, or otherwise controlled by Company or any Affiliate,
whether such property is situated on the premises of Company or any Affiliate or otherwise and, in particular, has no right of
privacy or expectation thereof in or to any computer provided by Company to [Consultant][Employee] or any disks and
other storage media relating thereto, filing cabinets or other work areas, all of which being subject to inspection by Company
personnel at any time with or without notice.

 

6.Notices. Any notice
or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date
of service if personally served or if telecopied (if telecopied on a business day and during business hours at the place of receipt
and if receipt is confirmed) or three (3) days after mailed if mailed by reputable international overnight delivery service, postage
prepaid and in any event addressed to the address set forth in the signature clause to this Agreement or to such other address
as shall be designated by written notice issued pursuant hereto.

 

7.Remedies; Damages, Injunctions
and Specific Performance. 

 

(a) Ancillary
Agreement. This Agreement shall be construed as an agreement ancillary to the Services Agreement, written or oral, entered
into by and between the Parties otherwise evidencing the [Consulting][Employment] Relationship, and the existence of any claim
or cause of action of [Consultant][Employee] against Company or any Affiliate, whether predicated on the Services Agreement or
otherwise, shall not constitute a defense to the enforcement by Company of this Agreement.

 

(b)Survival.
It is expressly understood and agreed that the covenants, agreements and services to be rendered and performed by [Consultant][Employee]
under this Agreement shall survive any termination or expiration of this Agreement, whether voluntary or involuntary, with or without
cause, and are special, unique, and of an extraordinary character.

 

(c)Remedies.
In the event of any default, breach or threatened breach by [Consultant][Employee] of this Agreement, Company shall be entitled,
if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either at law or in equity, and
shall be entitled to such relief as may be available to it pursuant hereto, at law or in equity, including, without limitation:
(i) damages for any breach of this Agreement; (ii) an order for the specific performance hereof by [Consultant][Employee]; or (iii)
an order enjoining [Consultant][Employee] from breaching such provisions, without bond and without prejudice to any other rights
and remedies that Company or any Affiliate may have for a breach of this Agreement.

 

(d)Tolling.
[Consultant][Employee] hereby expressly acknowledges and agrees that in the event the enforceability of any of the terms of this
Agreement shall be challenged in court or pursuant to arbitration and [Consultant][Employee] is not enjoined (either temporarily
or permanently) from breaching any of the restraints set forth in this Agreement, then if a court of competent jurisdiction or
arbitration panel finds subsequently that the challenged restraint is enforceable, the time period of the restraint shall be deemed
tolled upon the filing of the lawsuit challenging the enforceability of the restraint until the dispute is finally resolved and
all periods of appeal have expired.

 

    	Page 28

    	 

    
 

(e)Recovery
of Attorney’s Fees. In the event of any litigation arising from or relating to this Agreement, the prevailing party in
such litigation proceedings shall be entitled to recover, from the non-prevailing party, the prevailing party’s reasonable
costs and attorney’s fees, in addition to all other legal or equitable remedies to which it may otherwise be entitled.

 

(f)Governing
Law; Waiver of Jury Trial and Election of Venue.

 

THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF [_____] APPLICABLE TO CONTRACTS EXECUTED AND PERFORMED IN SUCH STATE WITHOUT
GIVING EFFECT TO CONFLICTS OF LAWS PRINCIPLES.

 

BECAUSE DISPUTES ARISING IN CONNECTION
WITH COMMERCIAL MATTERS, INCLUDING UNDER THIS AGREEMENT, ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT
PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT
THEIR DISPUTES (IF ANY) BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE
BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR
PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE PARTIES ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR MATTERS
RELATED HERETO.

 

THE PARTIES HEREBY AGREE TO SUBMIT TO THE
VENUE AND JURISDICTION OF THE SUPERIOR COURTS IN AND FOR THE COUNTY OF [_____], STATE OF [_____], USA, OR THE FEDERAL DISTRICT
COURT IN AND FOR THE ______ DISTRICT OF ______, USA, IN WHICH ANY LEGAL ACTION BY EITHER PARTY TO ENFORE OR DEFEND RIGHTS UNDER
THIS AGREEMENT SHALL BE BROUGHT AND WHICH SHALL HAVE SOLE AND EXCLUSIVE JURISDICTION OVER ANY SUCH LEGAL ACTION.

 

8.Miscellaneous. This
Agreement, together with the Services Agreement, if any, contains the complete agreement concerning the [Consulting][Employment]
Relationship between Company or any Affiliate and [Consultant][Employee] as of the date hereof. The waiver by any party to this
Agreement of a default or breach of any Section, subsection or provision of this Agreement shall not operate or be construed as
a waiver of any prior or subsequent default or breach of the same or of a different Section, subsection or provision by any party
hereto. Should any provision of this Agreement require judicial interpretation, the parties hereto agree that the court interpreting
or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against one party by
reason of the rule of construction that a document is to be more strictly construed against the party that itself, or through its
agent, prepared the same, and it is expressly agreed and acknowledged that Company and [Consultant][Employee] and each of it and
its [Consultant][Employee]s, legal and otherwise, have participated in the preparation hereof. All Sections, subsections, paragraphs,
terms and provisions of this Agreement are severable, and the unenforceability or invalidity of any of the terms, provisions, Sections,
subsections or paragraphs of this Agreement shall not affect the validity or enforceability of the remaining terms, provisions,
Sections, subsections or paragraphs of this Agreement, but such remaining terms, provisions, Sections, subsections or paragraphs
shall be interpreted and construed in such a manner as to carry out fully the intention of the Parties. The Section headings in
this Agreement are for convenience of reference only and shall not affect the meaning or interpretation hereof. This Agreement
may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which shall together
constitute one and the same instrument. The rights and obligations of Company or any Affiliate under this Agreement shall inure
to the benefit of and shall be binding upon any affiliate, successor or assign of or to the business of Company or any Affiliate.
Neither this Agreement nor any rights or obligations of [Consultant][Employee] shall be transferable or assignable by [Consultant][Employee]
without Company's prior written consent, and any attempted transfer or assignment hereof by [Consultant][Employee] not in accordance
herewith shall be null and void.

 

    	Page 29

    	 

    
 

IN WITNESS WHEREOF,
the Parties hereto have caused this Agreement to be executed on the date first set forth above.

 

	
        Company

         

        VIASPACE, Inc.

         

        Signature:                                    

        Printed Name:Mr. _______________

        Title:President 

        Address: 

         
	
        [CONSULTANT][EMPLOYEE]

         

        

        [_________]

         

        Signature:____________________________

        Printed Name:

        Address: 

 

 

 

    	Page 30

    	 

    

 

ATTACHMENT 1

TO

BUSINESS PROTECTION AGREEMENT

 

DEFINITIONS

 

For purposes of this Agreement, the following
terms and phrases shall have the meaning ascribed thereto:

 

“Affiliate” means, with
respect to Company, a Person, directly or indirectly, whether before, as of or following the Effective Date, that controls, is
controlled by or is under common control with Company. For purposes of this definition, “control” shall mean beneficial
ownership (direct or indirect) of more than 50% of the outstanding voting stock or other voting rights entitled to elect directors
(or in the case of an entity that is not a corporation the election or appointment of the corresponding managing authority).

 

“Business Client” shall
mean any Person who or that is an actual or prospective purchaser of either the services or products offered by Company or an Affiliate
(i.e., a client or customer).

 

“Business Partner” shall
mean any Business Client, vendor, supplier, investor, lender, Service Partner with which Company or any Affiliate maintains or
undertakes to develop or maintain a business relationship.

 

“Company Service Partner”
shall mean any Person other than [Consultant][Employee] who rendered services as either an consultant or independent contractor,
whether under the terms of an agreement substantially similar to this Agreement or otherwise, for and on behalf of Company or any
Affiliate and with whom [Consultant][Employee] has material contact during the Term of this Agreement.

 

“Confidential Information”
shall mean any and all Intellectual Property or other tangible or intangible property owned, licensed or otherwise controlled by
Company or any Affiliate or any Business Client and the Intellectual Property Rights thereto, which is of tangible or intangible
value to Company or any Affiliate or any Business Client and is not public information or is not generally known or
available to the competitors of either Company or any Affiliate or of an Business Client, but is known only to Company or any Affiliate
or any Business Client or any [Consultant][Employee], independent contractor or agent thereof to whom such information must be
confided in order to apply it to the uses intended.

 

“Developments” shall
mean any ideas, compositions, concepts, inventions, modifications, discoveries, designs, developments, improvements, processes,
specifications, drawings, work of authorships, algorithms, documentations, formulae, data, techniques, know-how, source codes and
object codes and other computer codes and software programs and related documentation, technologies, research and other Intellectual
Property any and all Intellectual Property Rights therein or thereto (whether or not patentable or registerable under copyright,
trademark or similar statutes or subject to analogous protection); provided, however, that in no event shall the
term “Developments” include the Excluded Property.

 

“Excluded Property”
shall mean those items of personal property either owned by [Consultant][Employee] or to which [Consultant][Employee] has exclusive
rights and listed on Schedule “1,” entitled “Excluded Property,” which is attached hereto and made a part
hereof.

 

    	Page 31

    	 

    
 

“Intellectual Property”
shall mean all of the following in any jurisdiction throughout the world: (a) all Developments (whether patentable or unpatentable
and whether or not reduced to practice) and all improvements thereto, and all patents, patent applications, and patent disclosures,
together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations thereof; (b) all
trademarks, service marks, trade dress, logos, slogans, trade names, corporate names, Internet domain names, and rights in telephone
numbers, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection therewith; (c) all copyrightable works, all copyrights,
and all applications, registrations, and renewals in connection therewith; (d) all mask works and all applications, registrations,
and renewals in connection therewith; (e) Work Product and Moral Rights; (f) all business plans, methods, practices, concepts and
opportunities, whether actual or prospective; business and financial information and records, including, without limitation, accounting
records, tax returns, financial statements, projections, forecasts or other budgets, other financial data or plans, business plans
and strategies; advertising and promotional materials, products and product plans, pricing or other strategies, whether implemented
or not; (g) Health Information (as defined in Health Insurance Portability and Accountability Act of 1996 (“HIPAA”));
(h) the identity of any and all Business Partners and the compilation of any identifying information relating thereto (e.g.,
contact lists); actual or prospective Business Partner-related information, whether received from or otherwise pertaining to such
Business Partners; (i) computer or data-base files; passwords or other access codes; software programs, language, algorithms codes;
reports; analyses; notes; interpretations; formulae, processes, technology, inventions, patents; (j) the terms of this Agreement
and any other agreement between the Parties; and (k) the Intellectual Property Rights to any and all of the foregoing and all copies
and tangible embodiments thereof (in whatever form or medium).

 

“Intellectual Property Rights”
shall mean any and all rights in and to Intellectual Property, including, without limitation, patent rights, copyrights, sui
generis rights, trade secrets, mask work rights and other such rights, throughout the world.

 

“Moral Rights” shall
mean all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as
“moral rights,” “artist's rights,” “droit moral rights,” or the like.

 

“Person” shall mean
any individual, partnership, limited partnership, limited liability partnership, limited liability company, corporation, trust,
association, non-profit or charitable organization or other entity, or an unincorporated organization, a governmental entity or
any department or agency thereof.

 

“Restricted Business”
shall mean, directly or indirectly, ________________________________.

 

“Term” shall mean that
period (a) commencing with the earlier of the (i) Effective Date or (ii) the date on which the [[Consulting][Employment] Relationship][Employment
Relationship] first commenced and (b) the ending with the Termination Date.

 

“Termination Date” shall
mean the date that coincides with the day on which services are last performed by [Consultant][Employee] for or on behalf of Company
or any Affiliate under the [[Consulting][Employment] Relationship][Employment Relationship].

 

    	Page 32

    	 

    
 

“Trade Secrets” shall
mean information, including, but not limited to, Confidential Information, that: (a) derives economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use; and (b) is the subject of efforts that are reasonable under the circumstances to maintain its
secrecy (to the extent that applicable law mandates a definition of “trade secret” inconsistent with the foregoing
definition, then the foregoing definition shall be construed in such a manner as to be consistent with the mandated definition
under applicable law).

 

“Work Product” shall
mean any and all Developments (and all Intellectual Property Rights with respect thereto), whether or not patentable or registerable
under copyright or similar statutes, that were or are developed, made, conceived or reduced to practice or learned by [Consultant][Employee],
either alone or jointly with others, during the Term or within twelve (12) months following the Termination Date and any and all
of [Consultant][Employee]’s][Employee’s] right, title, and interest, if any, therein or thereto.

 

 

    	Page 33

    	 

    
 

SCHEDULE 1

TO

BUSINESS PROTECTION AGREEMENT

 

Listing of Excluded Property

 

 

None.

 

 

    	Page 34

    	 

    

 

EXHIBIT “B”

 

ROYALTY PAYMENTS

 

 

Running Royalty: 

 

VIASPACE shall pay VGE for and during the
Term a royalty of eight percent (8%) on Net Sales (the “Running Royalty”) made in the VIASPACE Territory. Payment of
the Running Royalty shall be due and owing thirty (30) days following the end of the first calendar quarter during which such Net
Sales are made and each calendar quarter thereafter, with each such calendar quarter beginning on January 1st, April
1st, July 1st and October 1st.

 

Conditions for Conditional Renewal Terms.

 

The First Renewal Term:
As a condition to the right to renew the Initial Term, for years three and four following the Effective Date (the “First
Renewal Term”), VIASPACE shall have achieved during the Initial Term the following milestones as a condition to any such
renewal:

 

		·	One or more fully-executed, third party
sales contracts for the sale of Giant King Grass shall have been entered into during the Initial Term, pursuant to which VIASPACE
is to be paid the aggregate amount of at least $200,000 within that 24 consecutive monthly period following the signing (the “Initial
Sales Milestone”); and

 

		·	Two or more, third party growing locations
of at least 10 hectares in total shall have been obtained and planted during the Initial Term, which shall be subject to the reasonable
satisfaction of VGE.

 

The Second Renewal Term:
As a condition to the right to renew the First Renewal Term (for years five and six) of the License, VIASPACE shall have achieved
during the First Renewal Term the following milestones as a condition to any such renewal:

 

		·	A total of least three or more (including
the above) fully-executed, third party sales contracts for the sale of Giant King Grass shall have been entered into during the
First Renewal Term, pursuant to which VIASPACE is to be paid the aggregate amount of $400,000, with not less than $100,000 of the
Initial Sales Milestone having been paid during the First Renewal Term and with the remaining unpaid balance of the Initial Sales
Milestone being paid within six months of the Second Renewal Term (e.g., in the fifth year) and the Second Sales Milestone being
paid in full within that 24 consecutive monthly period following the signing of any such third contract; and

 

		·	A total of at least three or more (including
the two above) growing locations of at least 30 hectares in total shall have been obtained and planted during the Second Renewal
Term, which shall be subject to the reasonable satisfaction of VGE.

 

Third Renewal Term: As
a condition to the right to renew the Second Renewal Term (for years seven and eight) of the License (the “Third Renewal
Term”), VIASPACE shall have achieved during the Second Renewal Term the following milestones as a condition to any such renewal:

 

    	Page 35

    	 

    
 

		·	A total of least four or more (including
the above) fully-executed third party sales contracts for the sale of Giant King Grass shall have been entered into, pursuant to
which VIASPACE is to be paid the aggregate amount of $1,000,000, with not less than $500,000 having been paid prior to renewal;

 

		·	A total of at least four or more (including
the above) growing locations of at least 40 hectares in total shall have been obtained and planted, which shall be subject to the
reasonable satisfaction of VGE.

 

Fourth Renewal Term: As
a condition to the right to renew the Third Renewal Term (for years nine and 10) of the License (the “Fourth Renewal Term”),
VIASPACE shall have achieved during the Third Renewal Term the following milestones as a condition to any such renewal:

 

		·	A total of least five or more (including
the above) fully-executed third party sales contracts for the sale of Giant King Grass shall have been entered into, pursuant to
which VIASPACE is to be paid the aggregate amount of $1,500,000, with not less than $750,000 having been paid prior to renewal;
and

 

		·	A total of at least five or more (including
the above) growing locations of at least 50 hectares in total shall have been obtained and planted, which shall be subject to the
reasonable satisfaction of VGE

 

 

 

    	Page 36Exhibit 10.3

 

MUTUAL AND LIMITED RELEASE

AGREEMENT

 

THIS MUTUAL AND
LIMITED RELEASE (the “Agreement”) is entered into and made effective as of the 30th day of September 2012 (the
“Effective Date”) by and among the signatories to this Agreement (each of the signatories shall be referred to singularly
as a “Party” and collectively as the “Parties”). Except as otherwise defined herein, capitalized terms
and phrases shall have the meaning ascribed thereto in Section 2 of this Agreement.

 

BACKGROUND

 

On or about the 10th day of May 2010, VIASPACE
issued to Sung Chang a long-term debt instrument in the principal amount of $5,331,025 (the “Original Secured Note”),
the payment of which is secured by the Security Documents. Since its original issuance, the Original Secured Note was amended by
the parties to extend the due date for payment of each respective installment by one year (together with such amendment, the “Secured
Note”), with the first installment being due and payable thereafter on May 14, 2012 (the “First Installment”).
As part of such amendment, the Secured Note was assigned by Sung Chang to Changs, LLC (“Changs”).

 

The First Installment remains unpaid, along
with the Accrued Interest. Neither VIASPACE nor any one of its various subsidiaries, including VGE or its two lower tier subsidiaries,
has the financial wherewithal to satisfy the Secured Note as and to the extent due and owing. Given the insolvency of VIASPACE
on a consolidated basis, Changs, in lieu of exercising its remedies, has expressed a desire to cooperate in the recapitalization
of VIASPACE and VGE upon the terms and conditions described in that certain agreement entitled “Recapitalization Agreement
(the “Recapitalization”).

 

As a prelude to the Recapitalization, each
of the Parties entered into that term sheet entitled “TERM SHEET- VIASPACE & VGE RECAPITALIZATION,” dated as of
the 24th day of July 2012 (the “Recap Term Sheet”), pursuant to which the Parties expressed their desire
to negotiate, inter alia, a mutual release in connection with the Recapitalization.

 

NOW, THEREFORE, pursuant to the
Recap Term Sheet and in consideration of other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each of the Parties agree as follows:

 

AGREEMENT

 

1.  Limited
Mutual Releases by and Among All Parties.

 

1.1  The
Release. Except for Claims relating to the Excluded Obligations (which by definition are not included within the meaning
of the released Claims), each of the Parties, for and on behalf of itself and, as applicable, each of its shareholders,
partners or members, as the case may be, hereby and forever releases and discharges (each, a “Releasing Party”)
each of the other Parties and each shareholder, officer, director, employee, Affiliate, successor and assign thereof
(collectively, the “Released Parties”) from any and all Claims (the “Release”).

 

    	Page 1

    	 

    
 

1.2
 Covenant Not to Sue. The Release shall constitute a complete release of the Claims
and waiver of and a covenant not to sue under or in connection with any and all such Claims, and each of the Releasing
Parties shall be deemed to have fully, finally, and forever settled, discharged, released, waived, and abandoned any and all
such Claims any one or all of such Parties may have had or may have, and the Release shall in all respects and in any event
and in all cases be deemed to release each of the Released Parties from any injury, damage, liability, responsibility, or
obligation all or any one of the Releasing Parties may have suffered or incurred for, as a result of, with respect to or in
connection with such Claims.

 

1.3
 Waiver of Unknown Claims. In furtherance of the above-stated intention to bar each
and every Claim, except as otherwise agreed in this Agreement, each Releasing Party hereby expressly waives any and all
rights or benefits conferred by the provisions of section 1542 of the California Civil Code (“Section 1542”), and
by any similar provision of California, other state or federal law now in effect or in effect in the future, and expressly
consent that this Agreement shall be given full force and effect according to each and all of its express terms and
conditions, including those relating to unknown and unsuspected Claims specified above, if any. Section 1542
provides:

 

A general
release does not extend to the claims which the creditor does not know or suspect to exist in his favor at the time of executing
a release, which if known by him must have materially affected his settlement with the debtor.

 

The release by each Releasing
Party (when and as effective) in this Section shall extend to all unknown claims within the meaning of Section 1542 relating in
any way to each of the Released Parties and, as applicable, each respective shareholder, officer, director, Affiliate, successor
and assign thereof.

 

1.4  Informed
Release. Each Releasing Party acknowledges that it understands the significance and potential consequences of the release
of unknown claims and of the specific waiver of its rights under Section 1542. Except as otherwise agreed in this Agreement,
each Releasing Party intends that the Claims released by it under this Agreement shall be construed as broadly as
possible.

 

2.  Definitions.
For purposes of this Agreement, the following terms and phrases shall have the meaning ascribed thereto:

 

“Affiliate”
means, with respect to any party to this Agreement, a Person, directly or indirectly, as of or following the Effective Date, that
controls, is controlled by or is under common control with such party. For purposes of this definition, “control” shall
mean beneficial ownership (direct or indirect) of more than 50% of the outstanding voting stock or other voting rights entitled
to elect directors (or in the case of an entity that is not a corporation the election or appointment of the corresponding managing
authority); provided, however, that in any country where the local law shall not permit foreign equity participation
of more than 50%, then an “Affiliate,” shall further include any company in which such Person shall own or control,
directly or indirectly, the maximum percentage of such outstanding stock or voting rights permitted by local law or otherwise exercises
control over the management of such company.

 

“Assignment
Agreement” shall mean that certain agreement entitled “Delivery, Disclosure, Assignment and Assumption Agreement,”
and entered into by and among VGE, VIASPACE and each of the Former Employees as of the _ day of August 2012.

 

    	Page 2

    	 

    
 

“Claim”
shall mean any and all causes of action, actions, affirmative defenses, judgments, liens, indebtedness, obligations, damages, losses,
claims, liabilities and demands of every kind and character, whether known or unknown, suspected or unsuspected, existing or prospective,
from the beginning of time through and including the Effective Date, including, without limitation, any and all claims, including
claims based on, arising under or otherwise relating to the Civil Rights Act of 1964, the Employee Retirement Income Security Act
of 1974 , the Americans with Disabilities Act, the Vietnam Era Veterans Readjustment Act, all other federal or state statutes regulating
military service leaves, and all amendments thereof or any other relevant or potentially applicable state and federal statutes;
past wages or salaries, emotional distress, personal injuries or damages, disability insurance or other benefits (except vested
retirement benefits), violation of any express or implied agreement, written or verbal, and any common law duty, including claims
for attorney fees; provided, however, that in no event shall the term “Claim” include any Excluded Obligations.

 

“Excluded
Obligations” shall mean each of the following matters:

 

(i)  This
Agreement;

 

(ii)  Each
of the Former Employee’s Statements of Additional Terms and Conditions; provided, however, that each of
the Parties to each such respective agreement hereby agree that Sections 2(c) and (d) thereof following the date of this
Agreement shall have no applicability to the performance of services for and on behalf of VIASPACE so long as each such
employee thereunder enters into with VIASPACE and executes as an employee of VIASPACE the Business Protection Agreement, a
form of which is attached hereto;

 

(iii)  The
Assignment Agreement; the Recapitalization Agreement; License Agreement; that certain Lock Up Agreement (as defined in the
Recapitalization Agreement); those certain agreements entitled “Consulting Agreement” and “Business
Protection Agreement” entered into by and between Stephen Muzi and VGE; those certain agreements entitled
“Business Protection Agreements” to be entered into by and between VIASPACE and each of Stephen Muzi and Carl
Kukkonen, respectively; that certain agreement entitled “Loan Agreement” to be entered into by and between Kevin
Schewe, MD and VIASPACE and the Promissory Note and Security Agreement relating thereto; [that certain initial VIASPACE
Purchase Order]; that certain agreement entitled “Agreement to Grant Voting Rights and Transfer Preferred Share”
entered into by and between Sung H. Chang and Schewe, along with that certain Exhibit A attached thereto, all of which
documents being entered into of even date herewith (other than the Assignment Agreement);

 

(iv)  The
Note and Security Documents (as defined in the Recapitalization Agreement), provided, however, that any and all
claims under the Note and related Security Documents shall be subject to and limited by the Covenant not to Sue (as defined
in the Recapitalization Agreement);

 

(v)  The
Registration Rights Agreement, dated as of May 14, 2010, and entered into by and between VIASPACE and Sung Hsien Chang; provided, however,
that upon any exercise of the demand registration rights described therein, Chang shall be responsible for the payment of the
costs to register the shares subject to such exercise by him that would not otherwise be incurred by VIASPACE in its usual
course of business (e.g., Chang will not be responsible for costs of audit fees for any such audit that may otherwise be
conducted); provided, further, that Chang (nor any transferees of such shares) may not sell during any
calendar quarter more than the greater of either (1) two and one half (2.5) times the volume limitation pursuant to Rule
144(e) promulgated under the Securities Act of 1933, as amended, or (2) forty million (40,000,000) shares (as adjusted for
any stock splits, stock dividends, recapitalizations, combinations and the like) of all such shares that are to be registered
pursuant to his demand registration rights, without the prior written consent of VIASPACE, which consent shall not be
unreasonably delayed, denied, conditioned or withheld (the “Trickle Out”); provided, further, that
such Trickle Out does not otherwise undermine or adversely affect the effectiveness of such Registration
Statement;

 

    	Page 3

    	 

    
 

(vi)  The
Registration Rights Agreement, dated as of May 14, 2010, and entered into by and among VGE, Sung Hsien Chang, Hsiu Fen Su,
Chun Hao Chang, Jay Chang, each individual residents of the State of Georgia, and Green Solutions Group Ltd, a British Virgin
Islands company;

 

(vii)  Sections
5.1 through 5.6, and 5.7.4 and the rights associated therewith of the Share Purchase Agreement, dated as of the __ day of
April 2010, entered into by VIASPACE and Sung Chang, as amended;

 

(viii)  VIASPACE’s
obligation to satisfy the accrued vacation pay earned through the Closing by each of the Former Employees in connection with
the performance of employment services for and on behalf of VIASPACE and VGE prior to and through such Closing;

 

(ix)  Claims
for which a Released Party is not lawfully permitted to release (the “Preserved Claims”); provided, however,
that to the extent that any such Preserved Claims are asserted against any Chang Indemnified Party, then notwithstanding any
provision in this Agreement to the contrary, this Agreement and the Covenant Not to Sue (as defined in the Recapitalization
Agreement) shall be and become null and void with respect to any such affected Chang Indemnified Party; 

 

(x)  VGE’s
obligation to satisfy the accrued vacation pay earned through the Closing by Sung Chang in connection with the performance of
employment services for and on behalf of VGE prior to and through such Closing; and

 

(xi)  The
independent contractor agreement to be entered into by and between VGE and Stephen Muzi (“Muzi”) for the
performance by him of certain Chief Financial Officer and Secretarial services for and on behalf of VGE from the effective
date of the Recap Term Sheet until November 15, 2012 at $5,000 per month (in order to file the second quarter and third
quarter SEC 10-Q's) and for such longer period as the parties may mutually agree and that certain Business Protection
Agreement entered into of even date therewith by and between VGE and Muzi (the “Muzi Agreement”).

 

“Expired
Employment Agreements” shall mean those certain employment agreements entered into by and between VGE and each of the Former
Employees and made effective as of the __ day of August 2010.

 

“Former
Employees” shall mean Carl Kukkonen and Steve Muzi.

 

“License
Agreement” shall mean that certain license agreement entered into as of the Effective Date by and between VGE and VIASPACE
with respect to the license of certain rights in and to Giant King Grass (as defined therein).

 

    	Page 4

    	 

    
 

“Statement of Additional Terms
and Conditions” shall mean that certain addendum entitled “Statement of Additional Terms and Conditions Relating to
Employment Agreement,” which statement was attached to and made a part of each of the Expired Employment Agreements.

 

3.  Release-Related
Covenants. Each of the Parties hereby agrees that he or it, as the case may
be: 

 

3.1  No
Admission. Acknowledges and agrees that neither anything in this Release nor the offer, execution, delivery, or
acceptance thereof shall be construed as an admission by such Party of any kind, and this Release shall not be admissible as
evidence in any proceeding; this Release does not constitute an adjudication or finding on the merits and is not, and shall
not be construed as, an admission by any such Party of any violation of its policies, procedures, state or federal laws or
regulations; this Release may be introduced, however, in any proceeding to enforce its terms and conditions; provided, however,
that any such introduction shall be pursuant to an order protecting its confidentiality.

 

3.2  Covenant
Not to Sue. Shall never institute any action for suit-at-law or action against all or any of the Released Parties, nor
institute, prosecute, or in any way aid in the institution or prosecution of any Claim for damages, costs, loss of services,
expenses, or compensation for or on account of any damage, loss or injury, either to person or property or both, whether
developed or undeveloped, resulting to or to result, known or unknown, past, present, or future, arising out of any Claim
that has been released under this Agreement.

 

3.3  Non-disparagement.
Shall neither disparage nor denigrate the reputation, name or goodwill of any Released Party in any communication, verbal or
written, with any third-party, commencing with and following the Effective Date.

 

4.  Employment
Related Covenants.

 

4.1  Release
of Any Age Discrimination Claim. In compliance with the requirements of the Age Discrimination in Employment Act (ADEA),
as amended by the Older Workers’ Benefit Protection Act (OWBPA), each of the Former Employees and Sung Chang
(“Prior Officers”) hereby acknowledges by his/her signature below that, with respect to the rights and claims
waived and released under the ADEA and OWBPA: 

 

(a)  Prior
Officer has read and understands this Agreement; 

 

(b)  Prior
Officer was given at least 21 days from the date this Agreement was initially presented to accept the terms of this
Agreement;

 

(c)  Prior
Officer was advised in writing, via this Agreement, to consult with an attorney before signing this Agreement;

 

(d)  Prior
Officer had an opportunity to consult with an attorney before signing this Agreement;

 

(e)  Prior
Officer is releasing the each of the Released Parties from, among other things, any claims of age discrimination under the
ADEA or OWBPA; and

 

(f)  Prior
Officer understands that the release of age discrimination claims contained in this Agreement does not cover any rights or
claims that may arise after the Effective Date against each of the Released Parties.

 

    	Page 5

    	 

    
 

4.2  Revocation
of Age Release. Prior Officer may revoke the portion of this Agreement relating to release of age discrimination claims
covered by the ADEA or OWBPA within seven (7) calendar days after signing it. To be effective, such revocation must be
received in writing by VIASPACE Green Energy, 131 Bells Ferry Lane, Marietta, GA 30066. Revocation can be made by hand
delivery, telegram, facsimile, or postmarking before the expiration date of this seven (7) day period.

 

5.  Representations
and Warranties.

 

5.1  Warranty
of Authority. Each Party whose signature appears below represents and warrants to each other Party that he or it, as the
case may be, has been duly authorized and has full authority to execute this Agreement on behalf of himself and the entity or
entities for which he represents.

 

5.2  No
Assignment of Claims to Third Parties. Each of the Parties hereby represents and warrants to each other Party that he or
it, as the case may be, has not assigned or transferred, or purported to assign or transfer, to any Person any Claim released
under this Agreement.

 

5.3  No
Other Representations and Warranties. No Party has relied on any representations, whether oral or written, not expressly
set forth herein when entering into this Agreement.

 

6.  Miscellaneous.

 

6.1  Entire
Agreement. This Agreement constitutes and contains the final, complete and exclusive agreement and understanding between
the Parties. This Agreement supersedes or replaces all prior negotiations and all agreements, proposed or otherwise, whether
written or oral, concerning the subject matter hereof. This is a fully integrated document.

 

6.2  Severability.
If any portion of this Agreement or application thereof is held invalid, the invalidity shall not affect other provisions of
this Agreement that can be given effect without the invalid provision or application and, to this end, the provisions of this
Agreement are declared to be severable. 

 

6.3  Construction.
Each Party has cooperated in the drafting and preparation of this Agreement. Hence, this Agreement shall not be construed
against any Party on the basis that said Party was the drafter of this Agreement. The headings are for the convenience of the
Parties and are not to be used in construing the meaning of any provision of this Agreement.

 

6.4  No
Waiver of Breach. No waiver by one Party of any breach of any term or provision of this Agreement by the other Party
shall be binding unless in writing and signed by the Party waiving the breach.

 

6.5  Legal
Advice. The Parties acknowledge that they have been advised by their own legal counsel in connection with this Agreement
and enter into this Agreement solely on the basis of that advice and on their own independent investigation of all facts, law
and circumstances material to this Agreement or any provision thereof. The Parties hereby acknowledge that they have not
entered into this Agreement based upon any statement or omission by the other party, their agents, representatives, or
attorneys.

 

6.6  Binding
Effect. Each of the Parties understands and expressly agrees that this Agreement shall bind their successors and
assigns.

 

    	Page 6

    	 

    
 

6.7  Notices.
All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have
been duly given when (a) delivered by hand (with written confirmation of receipt), (b) sent by telecopier (with written
confirmation of receipt), or (c) when received by the addressee, if sent by a nationally recognized overnight delivery
service (receipt requested), in each case to the appropriate addresses and telecopier numbers set forth below (or to such
other addresses and telecopier numbers as a party may designate by written notice to the other parties):

 

If to VIASPACE:

 

VIASPACE Inc.

2102 Business Center Drive

Irvine, CA 92612

Telephone: 626-768-3360

Facsimile: 626-578-9063

 

With a copy to:

 

_________________________________

_________________________________

_________________________________

 

 

If to VGE: 

 

Mr. Sung Chang

VIASPACE Green Energy Inc.

131 Bells Ferry Lane

Marietta, Georgia 30066

With a copy to:

 

McDaniel Law Group, PC

P.O. Box 681235

Marietta, Georgia 30068

Attn: Mr. Frank McDaniel, Esq.

 

6.8  Jurisdiction
and Venue. As between the Parties, the transactions contemplated in this Agreement shall be governed as to validity,
interpretation, construction, effect, and in all other respects by the laws of the State of Georgia, without regard to the
conflicts of laws principals thereof. Each of the Parties irrevocably submits to the exclusive jurisdiction of the courts of
the State of Georgia located in the County of Cobb and the United States District Court in and for the Northern District of
Georgia for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Agreement and the
transactions contemplated hereby and thereby. Each of the Parties hereto irrevocably consents to the jurisdiction of any such
court in any such suit, action or proceeding and to the laying of venue in such court. Each of the Parties hereto irrevocably
waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably
waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient
forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS
AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

 

    	Page 7

    	 

    
 

6.9  Costs
and Attorneys’ Fees.

 

(a)  Award
to Prevailing Party in Proceeding. In the event any attorney is employed by any Party to this Agreement with regard to any
legal action, arbitration or other proceeding brought by any Party to this Agreement for the enforcement of this Agreement,
or because of an alleged dispute, breach, default or misrepresentation in connection with any of the provisions of this
Agreement, then the prevailing Party, whether at trial or upon appeal, and in addition to any other relief to which the
prevailing Party may be granted, shall be entitled to recover from the losing Party all costs, expenses, and a reasonable sum
for attorney fees incurred by the prevailing Party in bringing or defending such action, arbitration, or proceeding, and in
enforcing any judgment granted therein, all of which costs, expenses and attorneys fees shall be deemed to have accrued upon
the commencement of such action and shall be paid whether or not such action is prosecuted to judgment.

 

(b)  Judgment
or Order Shall Award. Any judgment or order entered in such matter shall contain a specific provision providing for the
recovery by the prevailing Party of attorney fees, costs, and expenses incurred in enforcing such judgment. For purposes of
this Section, attorney fees shall include, without limitation, fees incurred in the following: post-judgment motions;
contempt proceedings; garnishment, levy, and debtor and third party examinations; discovery; and bankruptcy
litigation.

 

6.10  Further
Assurances. Each of the Parties agrees (a) to furnish upon request to the other Party other such further information, (b)
to execute and deliver to the other Parties such other documents, and (c) to do such other acts and things, all as any other
Party may reasonably request for the purpose of carrying out the intent of this Agreement.

 

6.11  Counterparts.
This Agreement may be executed in counterparts, each of which, when executed, shall be an original, and all of which together
shall constitute one and the same agreement. The signatories may execute this Agreement by facsimile counterparts, and a
legible facsimile of a signature shall be as effective as an original signature.

 

6.12  Remedies.
No remedy conferred by this Agreement is intended to be exclusive of any other remedy and each remedy shall be cumulative and
in addition to every other remedy conferred hereunder or at law or in equity.

 

IN WITNESS WHEREOF,
upon and coincident with the Effective Date, this Agreement shall become effective.

 

	
        VIASPACE Inc.

By:/s/ Carl Kukkonen

Print Name:

Title:

Date Signed: ________
	 	
        VIASPACE Green Energy Inc.

        

        

        By: /s/ Sung Chang

        Print Name:

        Title:

        Date Signed: ________

 

	 	 	 

 

    	Page 8

    	 

    
 

 

	
         

         

         

         

        /s/ Carl
        Kukkonen

        Carl Kukkonen
	 	
         

         

         

         

        /s/ Sung
        Chang

        Sung Hsien Chang

	 	 	 
	
         

         

         

 

        /s/ Steve
        Muzi

        Steve Muzi
	 	
         

         

 

 

        /s/ Chun
        Hao Chang

        Chun Hao Chang

	 	 	 
	
         

         

         

         

        /s/ Kevin
        Schewe

        Kevin Schewe, MD
	 	
         

         

         

         

        /s/ Hsiu
        Fen Su

        Hsiu Fen Su

	 	 	 
	 	 	
        Changs,
LLC

         

        By:  /s/
        Sung Chang

        Sung Hsien Chang

        Authorized Member

	 	 	 
	 	 	
        JJ International, Inc.

         

        By:  /s/
        Sung Chang________________

        Sung Hsien Chang

        Authorized Officer

	 	 	 
	 	 	
        Green Solutions Group
        Ltd., a British Virgin Islands company

         

        By:  /s/
        Sung Chang_________________

        Sung Hsien Chang

        Authorized Officer

 

 

 

    	Page 9

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