Geospatial Corp (Form: S-1, Received: 03/26/2014 16:02:32)

As filed with the Securities and Exchange Commission on March 26, 2014

Registration No.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

GEOSPATIAL CORPORATION

(Exact name of registrant as specified in its charter)

Nevada

1623

87-0554463

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industry

Classification Code Number)

(I.R.S. Employer

Identification No.)

229 Howes Run Road,

Sarver, PA 16055

(724) 353-3400

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Mark A. Smith

Chief Executive Officer

Geospatial Corporation

229 Howes Run Road,

Sarver, PA 16055

(724) 353-3400

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copy to:

David J. Lowe

Sherrard, German & Kelly, P.C.

Two PNC Plaza, 28 ^th Floor

620 Liberty Avenue

Pittsburgh, PA 15222

(412) 355-0200

Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), check the following box: ☒

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☐ (do not check if a smaller reporting company)	Smaller reporting company	☒

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered		Amount to be registered				Proposed maximum offering price per share				Proposed maximum aggregate offering price				Amount of registration fee
Common Stock, par value $.001 per share			15,631,490	(1)		$	0.73	(2)		$	11,410,987.70	(2)		$	1,469.74	(2)

(1)	Represents shares of the Registrant’s common stock being registered for resale that have been issued to the selling stockholders named in this registration statement
(2)	Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act of 1933, using the average bid and asked prices as reported on the OTC Pink Marketplace on March 20, 2014 which was $0.73 per share.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BECOMES EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

SUBJECT TO COMPLETION, DATED _____________, 2014

PROSPECTUS

15,631,490 SHARES OF COMMON STOCK

This prospectus relates to the resale by the selling stockholders identified in this prospectus of up to 15,631,490 shares of the Company’s common stock. All of these shares, when sold, will be sold by these selling stockholders. The selling stockholders may sell these shares from time to time in the open market at prevailing prices or in individually negotiated transactions, through agents designated from time to time or through underwriters or dealers. We will not control or determine the price at which the selling stockholders decide to sell their shares. There are no minimum purchase requirements. The selling stockholders and any participating broker-dealers may be deemed “underwriters” of the shares of the Company’s common stock which they are offering within the meaning of the Securities Act of 1933 (as amended, the “Securities Act”), and any commissions or discounts given to any such broker-dealer may be regarded as underwriting commissions or discounts under the Securities Act. The selling stockholders have informed us that they do not have any agreement or understanding, directly or indirectly, with any person to distribute their common stock. Brokers or dealers effecting transactions in shares of the Company’s common stock should confirm the registration of these securities under the securities laws of the states in which transactions occur or the existence of an exemption from registration.

The Company is not selling any shares of common stock in this offering and therefore will not receive any proceeds from the sale of the Company’s common stock hereunder. The Company will pay the expenses of this offering. We will use our best efforts to maintain the effectiveness of the resale registration statement of which this prospectus is a part from the effective date until all securities registered under the registration statement have been sold or are otherwise able to be sold pursuant to Rule 144 promulgated under the Securities Act.

Our common stock is traded in the OTC Pink Marketplace maintained by the OTC Markets Group under the symbol “GSPH”.

Our business and investment in these securities involves significant risks. See “ Risk Factors ” beginning on page 2, to read about factors you should consider before buying these securities.

We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make your investment decision.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this prospectus is _______________, 2014

Table of Contents

PROSPECTUS SUMMARY		1
RISK FACTORS		2
RISK FACTORS RELATED TO OUR BUSINESS		2
RISK FACTORS RELATED TO OUR COMMON STOCK		6
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS		10
USE OF PROCEEDS		10
DIVIDEND POLICY		10
MARKET FOR OUR COMMON STOCK		11
NUMBER OF STOCKHOLDERS		11
DILUTION		11
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		12
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK		14
OUR BUSINESS		15
MANAGEMENT		18
EXECUTIVE COMPENSATION		19
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS		22
SELLING STOCKHOLDERS		24
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		27
DESCRIPTION OF CAPITAL STOCK		29
SHARES ELIGIBLE FOR FUTURE SALE		30
PLAN OF DISTRIBUTION		31
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES		33
LEGAL MATTERS		33
EXPERTS		33
WHERE YOU CAN FIND MORE INFORMATION		33
FINANCIAL STATEMENTS		F-1

We have not authorized anyone to provide information different from that contained in this prospectus. When you make a decision about whether to invest in these securities, you should not rely upon any information other than the information in this prospectus. Neither the delivery of this prospectus nor sale of these securities means that information contained in this prospectus is correct after the date of this prospectus. This prospectus is not an offer to sell or solicitation of an offer to buy these securities in any circumstances under which the offer or solicitation is unlawful.

Through and including _________, 2014 (the 40 ^th day after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PROSPECTUS SUMMARY

The following summary highlights selected information contained in this prospectus. This summary does not contain all the information you should consider before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully, including the “Risk Factors” section, the financial statements and the notes to the financial statements. As used throughout this prospectus, the terms “the “Company,” “we,” “us,” and “our” refer to Geospatial Corporation and, where appropriate, our consolidated subsidiaries.

About Our Company

Geospatial Corporation (formerly known as Geospatial Holdings, Inc.) provides proven cloud-based geospatial solutions to accurately locate and digitally map in 3D, underground pipelines and other infrastructure. Our professional staff offers the expertise, ability and technologies required to design and execute innovative, challenging solutions that push the Company to the forefront of the cloud-based infrastructure mapping industry. Geospatial Corporation is steadfastly committed to our mission: “To provide our clients with an unparalleled 3D understanding of the world’s underground infrastructure” .

We carefully listen to each client’s precise needs and provide unique and innovative technological solutions to locate, map and manage our clients’ critical infrastructure data. Our clear communication and time-tested technical expertise enable us to think outside the box as we provide underground infrastructure mapping solutions to benefit our clients and the community.

We provide two types of services to our clients. We provide data acquisition services utilizing various technologies to accurately locate the exact position and depth of underground pipelines and conduits along with information on existing aboveground infrastructure. We also provide data management services in which we securely manage our clients’ critical infrastructure data through the licensing of our cloud-based GeoUnderground GIS (Geographic Information System) software.

We were incorporated in Nevada in 1995. We did not commence our current business, however, until 2008. The mailing address and telephone number of our principal executive offices are: 229 Howes Run Road, Sarver, Pennsylvania 16055; 724-353-3400. We maintain an internet site at www.geospatialcorporation.com which contains information concerning us. Our internet website and the information contained therein or connected thereto are not intended to be incorporated into this prospectus and should not be considered a part of this prospectus.

Our common stock is considered a “penny stock” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which means that securities broker-dealers cannot recommend the common stock, which may make trading the common stock difficult.

Risk Factors

Investing in our securities involves significant risks. You should carefully read the section entitled “Risk Factors” beginning on page 2 for an explanation of these risks before investing in our securities.

About this Offering

This prospectus relates to the resale by the selling stockholders identified in this prospectus of up to 15,631,490 shares of the Company’s common stock. The selling stockholders may sell their shares of common stock from time to time at prevailing market prices. We will not receive any proceeds from the sale of the shares of common stock by the selling stockholders. As of March 20, 2014, 91,432,667 shares of the Company’s common stock were issued and outstanding and 3,804,358 shares of the Company’s Series B Convertible Preferred Stock were issued and outstanding.

RISK FACTORS

You should carefully consider the following risk factors and all other information contained in this prospectus. Our business and our securities involve a high degree of risk. The following summarizes material risks relating to our business and our common stock. The risks described below are not the only risks that we face. If any of the following risks actually occur, they would likely harm our business, financial condition, and results of operations.

RISK FACTORS RELATED TO OUR BUSINESS

Our business is at an early stage of growth and we may not be able to develop the customer base necessary for success.

Our business is still at an early stage of growth. We are still in the early stages of hiring and training our sales force and work force, and identifying and building customer relationships for the services that we expect to offer. We may not be able to achieve our development goals in an efficient manner, or at all, which could have a material adverse effect on our business, financial condition or results of operations in the future.

We have a limited operating history.

The Company currently has a limited operating history. We will have to carry out our business plan and generate significant revenues to achieve and sustain profitability in the future. Achieving and maintaining profitability is dependent upon certain factors which are outside of our control, including changes in business conditions, competition, and changes in applicable regulations.

Our independent auditor has expressed doubts about our ability to continue as a going concern.

Our Company has incurred net losses since inception. Our operations and capital requirements have been funded by sales of our common stock and preferred stock and advances from our chief executive officer. At September 30, 2013, our current liabilities exceeded our current assets by $5,635,189. Those factors create uncertainty about our ability to continue as a going concern.

We may have difficulty meeting our future capital requirements. If additional capital is not available, we may have to curtail or cease operations.

We will require significant capital resources in order to profitably grow our business. We may seek to obtain such capital resources through strategic collaborations, public or private equity or debt financings or other financing sources. The capital we need may not be available on favorable terms, or at all. Additional equity financings could result in significant dilution to our stockholders. If sufficient capital is not available to us, we may be required to reduce our workforce, reduce the scope of our marketing efforts, and/or customer service, sell all or part of our assets or terminate operations.

We may not be able to protect our proprietary technology from infringement.

Our business development will depend on unpatented proprietary know-how and trade secrets to establish and protect our intellectual property rights. We cannot assure you that any of our competitors will not independently develop equivalent or superior know-how, trade secrets or proprietary processes. If we are unable to maintain the proprietary nature of our technologies, our expected profit margins could be reduced as competitors imitating our technologies could compete aggressively against us in the pricing of certain services. As a result, our business, financial condition and results of operations may be materially adversely affected.

In addition, several of our business markets and customers are expected to be located outside of the United States. The laws protecting intellectual property in some countries may not provide adequate protection to prevent our competitors from misappropriating our intellectual property.

We may not be able to respond adequately to technological advances in the pipeline services industry.

We compete in an industry that has seen the development of increasingly advanced technology to deliver state-of-the-art pipeline management service solutions to a variety of end-users. Our success may depend on our ability to respond to technological changes in the industry. If we are unable to respond to technological change, timely develop and introduce new products, or enhance existing products in response to changing market conditions or customer requirements or demands, we will not be able to serve our clients effectively. Moreover, the cost to modify our services, products or technologies in order to adapt to these changes could be substantial and we may not have the financial resources to fund these expenses. We cannot assure you that we will be able to replace outdated technologies, replace them as quickly as our competitors or develop and market new and better products and services in the future.

We are engaged in highly competitive markets that pose challenges to continued revenue growth.

Our business is characterized by competition for contracts within the government and private sectors in which service contracts are often awarded through competitive bidding processes. We compete with a large number of other service providers who offer the principal services that we offer. Many of our competitors have significantly greater marketing and sales resources than we do. In this competitive environment, we must provide technical proficiency, quality of service and experience to ensure future contract awards and revenue and profit growth.

Our ability to recruit, train and retain professional personnel of the highest quality is a competitive necessity. Our future inability to do so would adversely affect our competitiveness.

Services in our data acquisition and pipeline data management markets are performed by our staff of technical professionals, field services, and management personnel. A shortage of qualified technical professionals currently exists in the engineering and energy services industries in the United States and foreign markets. Our future growth requires the effective recruiting, training and retention of well-qualified personnel. Our inability to do so would adversely affect our business performance and limit our ability to perform new contracts.

Loss of key individuals could disrupt our operations and harm our business.

Our success depends, in part, on the efforts of certain key individuals, including the members of our senior management team. The loss of the services of any of our key employees could disrupt our operations and have a material adverse effect on our business.

Changes and fluctuations in government spending priorities could materially affect our future revenue and growth prospects.

We expect that agencies of the U.S. federal government, and state and local governments and government agencies and government contractors, will be among our primary customers. These governments and agencies depend on funding or partial funding provided by the U.S. federal government. Consequently, any significant changes and fluctuations in the government’s spending priorities as a result of policy changes or economic downturns may directly affect our future revenue streams. Legislatures may appropriate funds for a given project on a year by year basis, even though the project may take more than one year to perform. As a result, at the beginning of a project, the related contract may only be partially funded, with additional funding committed only as appropriations are made in each subsequent year. These appropriations, and the timing of payment of appropriated amounts, may be influenced by, among other things, the state of the economy, competing political priorities, curtailments in the use of government contracting firms, rising raw material costs, delays associated with a lack of a sufficient number of government staff to oversee contracts, budget constraints, the timing and amount of tax receipts, and the overall level of government expenditures. Additionally, reduced spending by the U.S. government may create competitive pressure within our industry which could result in lower revenues and margins in the future.

Unpredictable economic cycles or uncertain demand for our pipeline data management capabilities and related services could cause our revenues to fluctuate or contribute to delays or the inability of customers to pay our fees.

Demand for our pipeline data management and other services are affected by the general level of economic activity in the markets in which we operate, both in the U.S. and internationally. Our customers, particularly our private sector customers, and the markets in which we compete to provide services, are likely to experience periods of economic decline from time to time. Adverse economic conditions may decrease our customers’ willingness to make capital expenditures or otherwise reduce their spending to purchase services, which could result in diminished revenues and margins for our business. In addition, adverse economic conditions could alter the overall mix of services that our customers seek to purchase, and increased competition during a period of economic decline could result in us accepting contractual terms that are less favorable to us than we might be able to negotiate under other circumstances. Changes in our mix of services or a less favorable contracting environment may cause our revenues and margins to decline. Moreover, our customers may experience difficult business climates from time to time and could delay or fail to pay our fees as a result.

If we are unable to accurately estimate and control our contract costs, then we may incur losses on our contracts, which could decrease our operating margins and significantly reduce or eliminate our profits.

It is important for us to control our contract costs so that we can maintain positive operating margins. Under our fixed price contracts, we receive a fixed price regardless of what our actual costs will be. Consequently, we realize a profit on fixed price contracts only if we control our costs and prevent cost overruns on those contracts. Under our time-and-materials contracts, we are paid for labor and equipment at negotiated hourly billing rates and for other expenses. Profitability on our contracts is driven by our ability to estimate and manage costs. Under each type of contract, if we are unable to control costs, we may incur losses on our contracts, which could decrease our operating margins and significantly reduce or eliminate our profits.

Due to the nature of the work we perform to complete pipeline data management contracts, we are subject to potential liability claims and contract disputes.

Our pipeline data management contracts often involve projects where design, construction, system failures or accidents could result in substantially large or punitive damages for which we could have liability. Our operations can involve professional judgments regarding the planning, design, development, construction, operations and management of facilities and public infrastructure projects. Although we are adopting a range of insurance, risk management safety and risk avoidance programs designed to reduce potential liabilities, there can be no assurance that such programs will protect us fully from all risks and liabilities.

We may also experience a delay or withholding of payments for services due to performance disputes. If we are unable to resolve these disputes and collect these payments, we would incur profit reductions and reduced cash flows.

If we miss a required performance standard, fail to timely complete, or otherwise fail to adequately perform on a project, then we may incur a loss on that project, which may reduce or eliminate our overall profitability.

We may commit to a client that we will complete a project by a scheduled date. We may also commit that a project, when completed, will achieve specified performance standards. If the project is not completed by the scheduled date or fails to meet the required performance standards, we may either incur significant additional costs or be held responsible for the costs incurred by the client to rectify damages due to late completion or failure to achieve the required performance standards. The uncertainty of the timing of a project can present difficulties in planning the amount of personnel needed for the project. If a project is delayed or canceled, we may bear the cost of an underutilized workforce that was dedicated to fulfilling that project. In addition, performance of a project can be affected by a number of factors beyond our control, including unavoidable delays from weather conditions, changes in the project scope of services requested by the client or labor or other disruptions. In some cases, should we fail to meet required performance standards, we may also be subject to agreed-upon financial damages. To the extent that these events occur, the total costs of the project could exceed our estimates or, in some cases, we could incur a loss on the project, which may reduce or eliminate our overall profitability.

We may be subject to procurement laws and regulations associated with government contracts. If we do not comply with these laws and regulations, we may be prohibited from completing our existing government contracts or suspended from government contracting and subcontracting for some period of time.

Our compliance with the laws and regulations relating to the procurement, administration and performance of our government contracts is dependent upon our ability to ensure that we properly design and execute compliant procedures. Our termination from any larger government contracts or suspension from future government contracts for any reason would result in material declines in our expected revenue. Because U.S. federal laws permit government agencies to terminate a contract for convenience, the U.S. federal government may terminate or decide not to renew our contracts with little or no prior notice.

We are subject to routine U.S. federal, state and local government audits related to our government contracts. If audit findings are unfavorable, we could experience a reduction in our profitability.

Our government contracts are subject to audit. These audits may result in the determination that certain costs claimed as reimbursable are not allowable or have not been properly allocated to government contracts according to federal government regulations. We are subject to audits for several years after payments for services have been received. Based on these audits, government entities may adjust or seek reimbursement for previously-paid amounts.

Our potential involvement in partnerships and joint ventures and our use of subcontractors may expose us to additional legal and market reputation damages.

Our methods of delivery may include the use of partnerships, subcontractors, joint ventures and other ventures. If our partners or subcontractors fail to satisfactorily perform their obligations as a result of financial or other difficulties, we may be unable to adequately perform or deliver our contracted services. Under these circumstances, we may be required to make additional investments and provide additional services to ensure the adequate performance and delivery of the contracted services. Additionally, we may be exposed to claims for damages that are a result of a partner’s or subcontractor’s performance. We could also suffer contract termination and damage to our reputation as a result of a partner’s or subcontractor’s performance.

We may be subject to litigation that will be costly to defend or pursue and uncertain in its outcome.

Our business may bring us into conflict with customers, vendors, investors, or others with whom we have contractual or other business relationships, or with our competitors or others whose interests differ from ours. If we are unable to resolve these conflicts on terms that are satisfactory to all parties, we may become involved in litigation brought by or against us. This litigation could be expensive and may require a significant amount of management’s time and attention, at the expense of other aspects of our business. The outcome of litigation is always uncertain, and in some cases could include judgments against us that require us to pay damages, enjoin us from certain activities, or otherwise affect our legal or contractual rights, which could have a significant adverse effect on our business.

The Company and its officers have been sued in the Court of Common Pleas of Butler County, Pennsylvania, by a group of investors alleging misrepresentations in connection with their investments in the Company. We have denied the allegations and believe that we will prevail should the case go to trial.

We use the percentage-of-completion method of accounting for many of our projects. This method may result in volatility in stated revenues and profits.

Our revenues and profits for many of our contracts are recognized ratably as those contracts are performed. This rate is based primarily on the proportion of labor costs incurred to date to total labor costs projected to be incurred for the entire project. This method of accounting requires us to calculate revenues and profit to be recognized in each reporting period for each project based on our predictions of future outcomes, including our estimates of the total cost to complete the project, project schedule and completion date, the percentage of the project that is completed and the amounts of any probable unapproved change orders. Our failure to accurately estimate these often subjective factors could result in reduced profits or losses for certain contracts.

Some of our services may be subject to government regulation.

State laws vary on data collection. Some states require that data collectors must have a surveyor’s license. These regulations may impair our ability to operate in some jurisdictions, or may require us to obtain surveyor licenses, which will result in higher expenses and reduced profitability.

We have a limited accounting and administrative staff, and anticipate the need to hire additional staff.

Due to our financial condition, we have been limited in our ability to fully staff our accounting and administrative departments. We intend to expand our accounting and administrative staff. Our success will depend on the effective recruitment, training, and retention of qualified, competent accounting and administrative professionals. Failure to adequately supplement our accounting and administrative staff could lead to internal control deficiencies.

We have not filed all our required tax returns.

Due to the Company’s financial condition, we have been unable to prepare and file our federal and state tax returns for the 2009 tax year through the current tax year. Although we do not owe income taxes, we may be liable for franchise taxes, penalties, and interest. We intend to comply fully with our current and prior federal and state tax reporting obligations in 2014.

RISK FACTORS RELATED TO OUR COMMON STOCK

Because our common stock is considered a “penny stock,” it may be more difficult for investors to sell shares of our common stock, and the market price of our common stock may be adversely affected.

Our common stock is considered to be a “penny stock” under the definitions in Rules 15g-2 through 15g-6 promulgated by the Securities and Exchange Commission (“SEC”) under Section 15(g) of the Exchange Act. Under the rules, for purposes relevant to us, stock is considered “penny stock” if: (i) the stock trades at a price less than $5.00 per share; (ii) it is not traded on a “recognized” national exchange; (iii) it is not quoted on the Nasdaq Stock Market, or even if quoted, has a price less than $5.00 per share; and (iv) is issued by a company with net tangible assets less than $2.0 million, if in business more than a continuous three years, or with average revenues at less than $6.0 million for the past three years. The principal result or effect of being designated a “penny stock” is that securities broker-dealers cannot recommend our stock but must trade it on an unsolicited basis.

Section 15(g) of the Exchange Act and Rule 15g-2 promulgated thereunder by the SEC require broker-dealers in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document before effecting any transaction in a penny stock for the investor’s account. Potential investors in our common stock are urged to obtain and read such disclosure carefully before purchasing any shares that are deemed to be “penny stocks.” Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to:

	(i)	obtain from the investor information concerning his or her financial situation, investment experience and investment objectives;

	(ii)	reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions;

	(iii)	provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii) above; and

	(iv)	receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor’s financial situation, investment experience and investment objectives. Compliance with these requirements may make it more difficult for holders of our common stock to resell their shares to third parties or to otherwise dispose of them in the market or otherwise.

Because of the rules and restrictions applicable to a penny stock, there is less trading in penny stocks and the market price of our common stock may be adversely affected. Also, many brokers choose not to participate in penny stock transactions. Accordingly, investors may not always be able to resell their shares of our common stock publicly at times and prices that they believe are appropriate.

FINRA sales practice requirements may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Trading of our common stock is limited which may negatively impact the price of our common stock and make it difficult for our stockholders to sell their shares.

Trading of our common stock is currently conducted on the OTC Pink Marketplace. The liquidity of our common stock is limited by, among other things, the number of shares that can be bought and sold at a given price and the lack of coverage by security analysts and the media, and may also be adversely affected by delays in the timing of transactions. Currently, there are approximately 200 holders of record of our common stock. These factors may result in lower prices for our common stock than might otherwise be obtained and could also result in a larger spread between the bid and asked prices for our common stock. In addition, without a large float, our common stock is less liquid than the stock of companies with broader public ownership and, as a result, the trading prices of our common stock may be more volatile. In the absence of an active public trading market, an investor may be unable to liquidate his investment in our common stock. Trading of a relatively small volume of our common stock may have a greater impact on the trading price of our stock than would be the case if our public float were larger. We cannot predict the prices at which our common stock will trade in the future.

An additional number of the Company’s Shares of common stock are likely to become freely tradable which could cause our stock price to decease.

As of March 20, 2014, we had 91,432,667 shares of common stock outstanding. Approximately 12,048,519 of such shares are currently unrestricted and freely tradable on the OTC Pink Marketplace where the Company’s common stock trades. In addition, 15,631,490 shares of our common stock have been registered for sale pursuant to this prospectus upon the effectiveness of the related registration statement. Of our remaining outstanding shares, as of the date of this prospectus, some of such shares may become eligible for resale in the future under Rule 144 under the Securities Act. In addition, we have 3,804,358 shares of Class B Convertible Preferred Stock outstanding, which shares are convertible into 38,043,580 shares of common stock at the option of the holders.

We cannot predict the effect, if any, that the ability to sell additional shares of our common stock to the public will have on the prevailing market price of our common stock from time to time. Nevertheless, if a significant number of shares of our common stock are sold in the public market, or if people believe that such sales may occur, the prevailing market price of our common stock could decline and could impair our future ability to raise capital through the sale of our equity securities.

There is the possibility of future dilution.

In order to meet our capital requirements, we may elect to offer and sell additional shares of our common or preferred stock. There is the possibility that such sales may result in dilution in the value of the Company’s common stock.

We are contractually obligated to issue additional shares of common stock to certain investors.

We are contractually obligated to issue additional shares of our common stock to certain investors because we have not registered their shares of our common stock under the Securities Act. We will continue to accrue obligations to issue additional shares of common stock until the shares covered by this prospectus are registered under the Securities Act. We cannot guarantee that such registration will become effective. We estimate that we will need to issue approximately 14.5 million shares of common stock before our registration becomes effective. The issuance of such shares may result in significant dilution in the value of our common stock. We have recorded a liability on our books for the estimated value of the shares that we will be required to issue. An increase in the estimated value of the shares, or an increase in the estimated number of shares to be issued, will negatively impact our results of operations.

The directors and officers of the Company may have certain personal interests that may affect the Company.

A small group of directors, executive officers, principal stockholders and affiliated entities will beneficially own, in the aggregate, approximately 50% of the Company’s outstanding voting securities. As a result, if some or all of them acted together, they would have the ability to exert substantial influence over and/or control the election of the Board of Directors and the outcome of issues requiring approval by the Company’s stockholders. This concentration of ownership may have the effect of delaying or preventing a change in control of the Company that may be favored by other stockholders. This could prevent transactions in which stockholders might otherwise recover a premium for their shares over current market prices.

Trading in our securities could be subject to extreme price fluctuations that could cause the value of your investment to decrease.

Our stock price has fluctuated significantly in the past and could continue to do so in the future. Our stock is thinly-traded, which means investors will have limited opportunities to sell their shares of common stock in the open market. Limited trading of our common stock also contributes to more volatile price fluctuations. The market price of our common stock may fluctuate significantly in response to numerous factors, some of which are beyond our control, such as:

	•	the announcement of new services or service enhancements by us or our competitors;
	•	developments concerning intellectual property rights and regulatory approvals;
	•	variations in our and our competitors’ results of operations;
	•	changes in earnings estimates or recommendations by securities analysts, if our common stock is covered by analysts;
	•	developments in the pipeline management services industry;
	•	the results of product liability or intellectual property lawsuits;
	•	future issuances of common stock or other securities;
	•	the addition or departure of key personnel;
	•	announcements by us or our competitors of acquisitions, investments or strategic alliances; and
	•	general market conditions and other factors, including factors unrelated to our operating performance.

Further, the stock market in general has recently experienced extreme price and volume fluctuations. Continued market fluctuations could result in extreme volatility in the price of our common stock, which could cause a decline in the value of our common stock. Given these fluctuations, an investment in our stock could lose value. A significant drop in our stock price could expose us to the risk of securities class action lawsuits. Defending against such lawsuits could result in substantial costs and divert management’s attention and resources, thereby causing an investment in our stock to lose additional value.

We have never paid dividends and do not anticipate paying any dividends on our common stock in the future, so any return on an investment in our common stock will depend on the market price of the stock.

We have not paid, and do not expect to pay, any cash dividends on our common stock, as any earnings generated from future operations will be used to finance our operations. As a result, investors will not realize any income from an investment in our common stock until and unless their shares are sold at a profit.

Failure to maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and operating results. In addition, current and potential shareholders could lose confidence in our financial reporting, which could have a material adverse effect on the price of our common stock.

Effective internal controls are necessary for us to provide reliable financial reports. A failure to provide effective internal controls may present opportunities for fraud and erroneous reporting of financial reports and operating results. We are required to document and test our internal control procedures in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, which requires annual management assessments of the effectiveness of our internal controls over financial reporting. During the course of our testing, we may identify deficiencies and weaknesses which we may not be able to remediate in time to meet the deadline imposed by the Sarbanes-Oxley Act for compliance with the requirements of Section 404. In addition, if we fail to maintain the adequacy of our internal control structure, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Disclosing significant deficiencies or material weaknesses in our internal controls, failing to remediate these deficiencies or weaknesses in a timely fashion or failing to achieve and maintain an effective internal control environment may cause investors to lose confidence in our reported financial information, which could have a material adverse effect on the price of our common stock.

Compliance with changing regulations concerning corporate governance and public disclosure may result in additional expenses.

There have been changing laws, regulations and standards relating to corporate governance and public disclosure, including the Sarbanes-Oxley Act, new regulations promulgated by the SEC and rules promulgated by the national securities exchanges and the NASDAQ. These new or changed laws, regulations and standards are subject to varying interpretations in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies, which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. As a result, our efforts to comply with evolving laws, regulations and standards are likely to continue to result in increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities. Our board members, Chief Executive Officer and Chief Financial Officer could face an increased risk of personal liability in connection with the performance of their duties. As a result, we may have difficulty attracting and retaining qualified board members and executive officers, which could harm our business. If our efforts to comply with new or changed laws, regulations and standards differ from the activities intended by regulatory or governing bodies, we could be subject to liability under applicable laws or our reputation may be harmed.

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

The statements set forth under the captions “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Result of Operations,” and “Business,” and other statements included elsewhere in this prospectus and registration statement, which are not historical, constitute “Forward Looking Statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder, including statements regarding the expectations, beliefs, intentions or strategies for the future. When used in this report, the terms “anticipate,” “believe,” “estimate,” “expect” and “intend” and words or phrases of similar import, as they relate to our business or our subsidiaries or our management, are intended to identify Forward-Looking Statements. We intend that all Forward-Looking Statements be subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These Forward-Looking Statements are only predictions and reflect our views as of the date they are made with respect to future events and financial performance. Forward-Looking Statements are subject to many risks and uncertainties that could cause our actual results to differ materially from any future results expressed or implied by the forward-looking statements.

Our business involves various risks, including, but not limited to, our ability to implement our business strategies as planned in a timely manner or at all; our lack of operating history; our ability to protect our proprietary technologies; our ability to obtain financing sufficient to meet our capital needs; and our inability to use historical financial data to evaluate our financial performance. See “Risk Factors” beginning on page 2.

Because the risk factors referred to above could cause actual results or outcomes to differ materially from those expressed or implied in any forward-looking statements made by us or on our behalf, you should not place undue reliance on any forward-looking statement. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligations to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of future events or developments. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

USE OF PROCEEDS

All shares of our common stock offered by this prospectus are being registered for the account of the selling stockholders. The Company will not receive any proceeds from the sale of the shares of our common stock by the selling stockholders.

DIVIDEND POLICY

We have never paid or declared any cash dividends. Future payment of dividends, if any, will be at the discretion of our board of directors and will depend, among other criteria, upon our earnings, capital requirements, and financial condition as well as other relative factors. Management intends to retain any and all earnings to finance the development of our business, at least in the foreseeable future. Such a policy is likely to be maintained as long as necessary to provide working capital for our operations. The only restrictions that limit the ability to pay dividends on common equity are those restrictions imposed by law. Under Nevada corporate law, no dividends or other distributions may be made which would render the Company insolvent or reduce assets to less than the sum of its liabilities plus the amount needed to satisfy any outstanding liquidation preferences.

MARKET FOR OUR COMMON STOCK

Our common stock is not listed on any national securities exchange or any national market system. Trading of our common stock is currently conducted on the OTC Pink Marketplace under the symbol “GSPH”. The last reported sales price per share of the Company’s common stock as reported on the OTC Pink Marketplace on March 20, 2014 was $0.73.

The following sets forth high and low bid price quotations for each calendar quarter during the last two fiscal years that trading occurred or quotations were available. Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

Quarter Ended	High		Low
March 31, 2012	$	0.12	$	0.05
June 30, 2012	$	0.15	$	0.05
September 30, 2012	$	0.22	$	0.07
December 31, 2012	$	0.15	$	0.06
March 31, 2013	$	0.13	$	0.06
June 30, 2013	$	0.12	$	0.06
September 30, 2013	$	0.32	$	0.13
December 31, 2013	$	1.08	$	0.25

The selling stockholders may sell all or a portion of their shares on the OTC Pink Marketplace at prices prevailing at the time of sale, or related to the market price at the time of sale, or they may otherwise sell their shares at negotiated prices. We cannot determine what the actual offering price will be at the time of sale.

NUMBER OF STOCKHOLDERS

As of March 20, 2014, there were approximately 200 holders of record of the Company’s common stock.

DILUTION

The Company’s common stock to be sold by the selling stockholders is common stock that is already issued and outstanding. Accordingly, there will be no dilution to our existing stockholders.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

You should read the following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) together with our financial statements and the related notes thereto appearing elsewhere in this prospectus and related registration statement.

Some of the information contained in this MD&A or set forth elsewhere in this prospectus, including information with respect to our plans and strategy for our business and related financing, includes Forward-Looking Statements that involve risks and uncertainties. See “SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS” above. In addition, you should read the “Risk Factors” section of this prospectus for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the Forward-Looking Statements contained in the following discussion and analysis.

Overview

We provide proven cloud-based geospatial solutions to accurately locate and digitally map underground pipelines and other infrastructure in three dimensions. Our professional staff offers the expertise, ability, and technologies required to design and execute innovative solutions that are delivered in a robust cloud-based GIS (geographic information system) platform. Our mission is to provide our clients with an unparalleled 3D understanding of the world’s underground infrastructure.

Liquidity and Capital Resources

At September 30, 2013, we had current assets of $637,906, and current liabilities of $6,273,095.

Our Company has incurred net losses since inception. Our operations and capital requirements have been funded by sales of our common and preferred stock and advances from our chief executive officer. At September 30, 2013, current liabilities exceeded current assets by $5,635,189. Those factors raise doubts about our ability to continue as a going concern.

In 2012, we raised approximately $632,000 in cash through private sales of our Series B Convertible Preferred Stock (“Series B Stock”), and converted approximately $215,000 in liabilities to Series B Stock. From January through September, 2013, we raised approximately $1,884,000 through private sales of our Series B Stock and common stock, and converted approximately $2,008,000 of liabilities to Series B Stock and common stock. In addition, we have negotiated settlements or long-term extensions on approximately $1,726,000 of liabilities from 2012 through September 30, 2013. We entered into an agreement with Reduct NV, licensor of our former exclusive technology, on May 10, 2013 that eliminates all prior liabilities to Reduct in consideration for the issuance of 9,000,000 shares of our common stock, warrants to purchase 3,500,000 shares of our common stock, and a commitment to purchase $300,000 of equipment from Reduct. The agreement allows us to purchase their products on a non-exclusive basis without the minimum purchase requirements to maintain the exclusive license.

Management is continuing efforts to secure funding sufficient for the Company’s operating and capital requirements through private sales of common stock, and to negotiate settlements or extensions of existing liabilities. The proceeds of such sales of stock, if any, will be used to fund general working capital needs.

Beginning in 2012, we changed the focus of our company to position us to generate revenue from data acquisition and data management. We expanded our service offerings to provide data acquisition services utilizing twelve different technologies. We developed a new cloud-based mapping software to be marketed under our existing name GeoUndergound that replaces our previous version of GeoUnderground. We believe that our changes to our operating focus will enable us to begin to generate significant revenue from operations.

We believe that our actions and planned actions will enable us to finance our operations beyond December 31, 2014.

We do not believe that inflation and changing prices will have a material impact on our net sales and revenues, or on income from continuing operations.

Results of Operations for the Nine Months Ended September 30, 2013 and September 20, 2012

Sales were $494,738 for the nine months ended September 30, 2013, compared to $336,672 for the nine months ended September 30, 2012. Cost of sales was $162,781 for the nine months ended September 30, 2013, compared to $136,575 for the nine months ended September 30, 2012. Our sales have fluctuated throughout 2013 and 2012 as our ability to perform jobs was hampered by our financial condition. We expect sales and cost of sales to continue to fluctuate as our business reaches maturity. The increase in sales and cost of sales in 2013 was due to our improved financial condition, which allowed us to complete more projects.

Selling, general and administrative (“SG&A”) expenses include all costs that are not directly associated with our revenue-generating activities. SG&A expenses include payroll costs for sales, administrative, and technical personnel, sales and marketing costs, corporate costs, and facilities costs. SG&A expenses were $1,194,556 for the nine months ended September 30, 2013, compared to $932,022 for the nine months ended September 30, 2012. The increase in SG&A costs for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012 was due to increased expenses resulting from the expansion of our sales and administrative staff in 2013.

Other income and expenses include interest expense, and non-business income and expenses. Other income and expense for the nine months ended September 30, 2013 was a net income of $529,161, which included interest expense of $380,521, and gain on extinguishment of debt of $909,682. Other income and expense for the nine months ended September 30, 2012 was a net expense of $201,972, which included interest expense of $210,790, gain on extinguishment of debt of $1,733, and other income of $7,085. The increase in interest expense in 2013 is due to interest on a short-term loan. The gains on extinguishment of debt resulted from settlement agreements on prior liabilities, which included a gain of $861,645 resulting from a Mutual Termination and Release Agreement with Pace Global Energy Services, LLC and Ridge Global, LLC during the nine months ended September 30, 2013.

We had no net benefit from income taxes, as our deferred tax benefit was completely offset by a valuation allowance due to the uncertainty of realization of the benefit.

Results of Operations for the Years Ended December 31, 2012 and December 31, 2011

Sales were $336,672 for the year ended December 31, 2012, compared to $387,282 for the year ended December 31, 2011. Cost of sales was $145,916 for the year ended December 31, 2012, compared to $359,684 for the year ended December 31, 2011. Our sales fluctuated throughout 2012 and 2011 as our ability to perform jobs was hampered by our financial condition. We expect sales and cost of sales to continue to fluctuate as our business reaches maturity. The decrease in sales in 2012 was due to the cancellation of a series of federal contracts in 2012. The decrease in cost of sales relative to sales in 2012 was due to the reduction in federal contracts, which are generally less profitable than our non-federal contracts.

SG&A expenses were $1,256,128 for the year ended December 31, 2012, compared to $2,051,661 for the year ended December 31, 2011. The decrease in SG&A costs for the year ended December 31, 2012 compared to the year ended December 31, 2011 was due to a reduction in technical personnel, and expenses of $250,000 in 2011 for legal defense related to a lawsuit brought by certain shareholders and our former investment banking advisor.

Other income and expense for the year ended December 31, 2012 was a net expense of $326,129, which included interest expense of $335,900, a gain on extinguishment of debt of $1,733, and other income of $8,038. Other income and expense for the year ended December 31, 2011 was a net expense of $233,249, which included interest expense of $233,855, and other income of $606. The increase in interest expense in 2012 was due to interest on a short-term loan taken in 2012.

We had income from discontinued operations in 2011 of $14,127 from our Utility Services and Consulting Corporation (“USCC”) subsidiary. In March, 2011, we discontinued the operations of USCC and sold substantially all of its assets.

We had no net benefit from income taxes, as our deferred tax benefit was completely offset by a valuation allowance due to the uncertainty of realization of the benefit.

Off-Balance Sheet Arrangements

The Company had no off-balance sheet arrangements as of September 30, 2013.

Application of Critical Accounting Policies

We prepare our financial statements in conformity with accounting principles generally accepted in the United States of America, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions which, in our opinion, are significant to the underlying amounts included in the financial statements and for which it would be reasonably possible that future events or information could change those estimates include:

Registration Payment Arrangements . We are contractually obligated to issue shares of our common stock to certain investors for failure to register their shares of our common stock under the Securities Act. We have recorded a liability for the estimated number of shares to be issued at the fair value of the stock to be issued. We review on a quarterly basis our estimate of the number of shares to be issued and the fair value of the stock to be issued.

Realization of Deferred Income Tax Assets. We provide a net deferred tax asset or liability equal to the expected future tax benefit or expense of temporary reporting differences between financial reporting and tax accounting methods and any available operating loss or tax credit carryovers. At September 30, 2013, we had a deferred tax asset resulting principally from our net operating loss deduction carryforward available for tax purposes in future years. This deferred tax asset is completely offset by a valuation allowance due to the uncertainty of realization. We evaluate the necessity of the valuation allowance quarterly.

Estimated Costs to Complete Fixed-Price Contracts. We record revenues for fixed-price contracts under the percentage-of-completion method of accounting, whereby revenues are recognized ratably as those contracts are completed. This rate is based primarily on the proportion of contract costs incurred to date to total contract costs projected to be incurred for the entire project, or the proportion of measurable output completed to date to total output anticipated for the entire project. We review our estimates of costs to complete each contract quarterly, and make adjustments if necessary. At September 30, 2013, we do not believe that material changes to contract cost estimates at completion for any of our open contracts are reasonably likely to occur.

QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk—Interest rate risk refers to fluctuations in the value of a security resulting from changes in the general level of interest rates. We do not have significant short-term investments. Accordingly, we believe that we do not have a material interest rate exposure.

Foreign Currency Risk—Our functional currency is the United States dollar. We do not currently have any assets or liabilities denominated in foreign currencies. Consequently, we have no direct exposure to foreign currency risk.

Commodity Price Risk—Based on the nature of our business, we have no direct exposure to commodity price risk.

OUR BUSINESS

Company Overview

The Company was incorporated on December 26, 1995 in the state of Nevada as Kayenta Kreations, Inc. In connection with a merger in 2008, the Company changed its name to Geospatial Holdings, Inc., and in 2013, changed its name to Geospatial Corporation (“we” or the “Company”). Geospatial Mapping Systems, Inc. is the Company’s wholly-owned subsidiary and operating unit.

General Description of the Business

We provide proven cloud-based geospatial solutions to accurately locate and digitally map in 3D underground pipelines and other infrastructure. Our professional staff offers the expertise, ability and technologies required to design and execute innovative, challenging solutions that push the Company to the forefront of the cloud-based infrastructure mapping industry. Geospatial Corporation is steadfastly committed to our mission – “To provide our clients with an unparalleled 3D understanding of the world’s underground infrastructure”.

We provide two types of services to our clients. Data acquisition entails utilizing various technologies to accurately locate the exact position and depth of underground pipelines and conduits along with information on existing aboveground infrastructure. We provide data management services in which we securely manage this critical infrastructure data through the licensing of our cloud-based GeoUnderground GIS (Geographic Information System) software.

Product Development and Introduction

The GIS technology and mapping industry is characterized by rapid technological change in computer hardware, operating systems and software. In addition, consumers’ requirements and preferences rapidly evolve, as do their expectations of the performance of their software and the accuracy of the collected data managed by their software. To keep pace with these changes we maintain a vigorous program of new product development to address demands in the marketplace for our products. Just as the transition from mainframes to personal computers transformed the industry thirty years ago, we believe our industry is undergoing a similar transition from the personal computer to cloud, social and mobile information management and sharing.

We dedicate considerable technical and financial resources to research and development to further enhance our existing products and to create new software products and data acquisition technologies. Our software is primarily developed internally, however, we also use independent firms or contractors to perform some of our product development activities.

We spent $67,527 on research and development during the year ended December 31, 2012. We did not have material research and development expenditures during the year ended December 31, 2011.

Sales and Marketing Efforts

We have established a strong reputation as a technological leader in data acquisition and mapping of all types of underground, underwater, and above-ground infrastructure. Along with GeoUnderground, we now provide a best-of-class cloud-based infrastructure management solution to our clients, which include utilities, municipalities, government agencies, and other facilities. Over the past few years, due to financial constraints, the majority of our sales have resulted from word-of-mouth referrals. We have not had a formal marketing or sales program over the past three years.

We intend to establish Regional Technical Sales Managers (“RTSMs”) in various sales regions across the United States, Canada, the Middle East, and Australia. Each RTSM will be responsible for developing and implementing a sales program which meets our specific targets. As business is developed in each sales region, we expect field technicians to be assigned to work under each RTSM to assist the RTSM in performing pipeline mapping services.

We intend to engage in direct-sale marketing efforts, whereby we will require that each of our RTSMs establish relationships and schedule webinar meetings with GIS and utilities managers, engineering companies, major utility companies and major utility contractors within each of their respective sales regions in order to demonstrate our data acquisition technologies, GeoUnderground, and its associated benefits. We also intend to demonstrate the use and functionality of GeoUnderground at numerous national and regional trade shows sponsored by related industry groups. In addition, we will expect each RTSM to generate sales leads through social media and webinars.

Financing

From January 1, 2012 through September 30, 2013, we raised approximately $2,516,000 in cash through the private sale of its common stock and Series B Stock. In addition, during that period, we converted approximately $2,223,000 of our liabilities to common stock and Series B Stock. We intend to continue to sell our common stock in private transactions to fund our general working capital needs.

Intellectual Property and Licenses

We maintain a program to legally protect our investment in technology through a combination of patent, copyright, trademark and trade secret protections, confidentiality procedures and contractual provisions. The nature and extent of legal protection associated with each such intellectual property right depends on, among other things, the type of intellectual property right and the given jurisdiction in which such right arises. We believe our intellectual property rights are valuable and important to our business.

Nonetheless, our intellectual property rights may not be successfully asserted in the future or may be invalidated, circumvented or challenged. Enforcement of intellectual property rights against alleged infringers can sometimes lead to costly litigation and counterclaims. Our inability to protect our proprietary information could harm our business.

We retain ownership of all software we develop. All software is licensed to users. These licenses contain restrictions on duplication, disclosure and transfer.

We believe that because of the limitations of laws protecting our intellectual property and the rapid, ongoing technological changes in data collection and GIS software industries, we must rely principally upon data acquisition enhancements, GIS software engineering and marketing skills to maintain and enhance our competitive market position.

Customers

To date, we have successfully completed over 150 projects for a varied group of clients including contractors, municipalities, government agencies, utilities, telecoms, and engineering companies. We are not dependent on one or a few major customers.

Government Contracts

We expect that some of our contracts will be with federal and state government entities. These contracts may be subject to various procurement laws and regulations. If we do not comply with these laws and regulations, we may be prohibited from completing our existing government contracts or suspended from government contracting and subcontracting for some period of time. In addition, through our government contracts, we are subject to routine U.S. federal, state and local government audits. If audit findings are unfavorable, we could experience a reduction in our profitability. We are subject to audits for several years after payments for services have been received. Based on these audits, government entities may adjust or seek reimbursement for previously paid amounts.

Competition

The markets for our products and services are highly competitive and subject to rapid change. We strive to increase our competitive standing by investing in research and development, allowing us to enhance our software and data collection capabilities. We also compete by investing in marketing and sales to more effectively reach new and existing customers.

Our business is highly competitive with respect to pipeline asset management services. While we believe that our proprietary technologies provide advantages to our clients, we will compete with numerous public and private engineering firms that provide some or all of the services that we provide. Our competitors range from large national and international firms, such as Parsons Brinkerhoff Inc., CH2M Hill Companies, PBS&J, Tetra Tech, Dycom Industries, Inc., Consolidated Utility Services, Inc., URS Corporation and CDM, to a vast number of smaller, more localized firms.

The software industry has limited barriers to entry, and the availability of computing power with continually expanding performance at progressively lower prices contributes to the ease of market entry. The GIS industry is presently undergoing a platform shift from the personal computer to cloud and mobile computing. This shift lowers the barriers to entry and poses a disruptive challenge to established GIS software companies. In addition, some of our competitors in certain markets have greater financial, technical, sales and marketing and other resources than we do. Because of these and other factors, competitive conditions in our industry are likely to continue to intensify in the future. Increased competition could result in price reductions, reduced net revenue and profit margins and loss of market share, any of which could harm our business.

We believe that the principal competitive factors (in the order of importance) in the areas of services we offer are: (i) quality of available technologies and software, (ii) quality of service, (iii) reputation, (iv) experience, (v) technical proficiency, (vi) local geographic presence, and (vii) cost of service. We believe that we are well positioned to compete effectively by emphasizing the quality and proprietary nature of our technologies and the quality of services that we offer. We are also dependent upon the availability of staff and our ability to recruit qualified management professionals and technicians. A shortage of qualified technical professionals currently exists in the engineering/GIS industry in the United States.

Seasonality

It is possible that our contract revenue and income from operations may be slightly lower for our first fiscal quarter than for the remaining quarters due to the effect of winter weather conditions, particularly in the Mid-Atlantic and Midwest regions of the United States. Our GIS/data management activities should not be as directly impacted by seasonal weather conditions.

Personnel

We believe that our success will greatly depend on our ability to identify, attract and retain capable employees. As of March 20, 2014, we had seven (7) employees, all of whom are full-time employees. We believe that our relations with these employees are good. None of our employees are represented by a labor union or otherwise represented under a collective bargaining agreement.

Environmental Compliance

As our services are applicable to a large number of pipeline industry segments, we will be working, in many cases, in and around environmentally-sensitive areas, and with pipeline materials that may require specific environmental training and strict environmental procedures and guidelines. Failure to comply with these federal, state, or local environmental regulations could result in substantial penalties or fines. We have not incurred any material costs of environmental regulations during 2012 and 2011.

The enactment of various federal, state, and local environmental regulations, and variations in federal, state, and local funding for environmental compliance and enforcement of these regulations may have an effect on the capital expenditures of our clients, and thus may affect our ability to generate revenue.

Description of Property

Our headquarters office is located in Sarver, Pennsylvania. This building, which we lease from the Company’s Chairman/CEO, has approximately 3,200 square feet of office space and is used by our corporate and operations staff. This property is rented under a month-to-month lease at $6,500 per month.

We believe that the Company’s existing facilities are adequate to meet its business needs for the foreseeable future.

Legal Proceedings

The Company is subject to various claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities. We believe that any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on the financial condition or the results of operations of the Company.

On April 19, 2012, a lawsuit was filed against the Company and its officers in the Court of Common Pleas of Butler County, Pennsylvania by a group of investors alleging misrepresentations in connection with the plaintiffs’ investments in the Company during 2009 and 2010. The plaintiffs are seeking compensatory damages, rescission and other equitable relief. The Company has denied the allegations and believes that it will prevail should the case go to trial. The Company has recorded an expense to the extent of its insurance deductible of $250,000 for the costs of its legal defense.

MANAGEMENT

Our directors and executive officers, their ages and positions as of December 31, 2013, are set forth below. All of our directors will hold office until the next annual meeting of stockholders and the election and qualification of their successors unless they resign or are terminated earlier.

Name	Age	Position(s)
Mark A. Smith	59	Chairman of the Board of Directors and Chief Executive Officer
Troy G. Taggart	48	President
Thomas R. Oxenreiter	47	Chief Financial Officer, Secretary, and Director

Mark A. Smith has served as our Chairman of the Board and Chief Executive Officer since 2008. Prior to that, Mr. Smith was a founder of, and served as President and Chief Executive Officer from 1998 to 2005 and Chairman through 2006 of Underground Solutions, Inc. (“Underground Solutions”) (OTC BB: “UGSI”), an infrastructure technology company that developed pipeline technologies. Prior to serving with Underground Solutions, Mr. Smith was involved as a principal or investor in several construction, real estate and technology companies. Mr. Smith’s expertise in the Company’s industry led us to conclude that he would be a valuable member of the Board of Directors. As our founder, he brings historical knowledge and strategic insight to the Board.

Troy G. Taggart joined the Company as an employee in 2012 and has served as our President since 2013. Mr. Taggart held executive and senior-level positions with several financial services firms prior to co-founding McKim and Company (Formerly VentureRound), a boutique investment banking firm, in 2001. Mr. Taggart served as Executive Vice President of Bacterin International (AMEX/NYSE: “BONE”) from 2008 through 2012.

Thomas R. Oxenreiter, CPA has served as our Chief Financial Officer, Secretary, and Director since 2008. Mr. Oxenreiter worked for several years in public accounting and private industry. Mr. Oxenreiter is a graduate of Villanova University. Mr. Oxenreiter’s financial expertise led us to conclude that he would be a valuable member of our Board of Directors. As our current Chief Financial Officer, he is well suited to inform the Board of the current operations of the Company. As a Certified Public Accountant, he brings significant financial expertise.

EXECUTIVE COMPENSATION

The following table sets forth a summary for the fiscal years ended December 31, 2013 and 2012 of the cash and non-cash compensation awarded, paid or accrued by the Company to our Chief Executive Officer and our two most highly compensated officers other than our Chief Executive Officer who served in such capacities in 2013 (collectively, the “Named Executive Officers”). All currency amounts are expressed in U.S. dollars.

Summary Compensation Table

Name and Principal Position	Year		Salary ($)		Bonus ($)		Stock Award(s) ($)		Option Award(s) ($) ⁽¹⁾		Non-Equity Incentive Plan Compensation ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($) ⁽²⁾		Total ($)
Mark A. Smith,		2013		314,167		—		—		—		—		—		92,110		406,277
Chairman of Board of Directors and Chief Executive Officer		2012		250,000		—		—		—		—		—		25,309		275,309
Troy G. Taggart		2013		213,750		—		—		—		—		—		11,391		225,141
President		2012		37,500		—		70,000		—		—		—		—		107,500
Thomas R. Oxenreiter,		2013		135,257		—		—		—		—		—		53,149		188,406
Chief Financial Officer		2012		125,000		—		—		—		—		—		25,472		150,472

(1)	The Company has determined that stock appreciation rights granted in 2013 to the Named Executive Officers have no value.
(2)	This column includes employee benefit amounts including health insurance, and tax gross-ups in 2013 of $57,887 and $18,925 for Mr. Smith and Mr. Oxenreiter, respectively.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information with respect to the Named Executive Officers concerning equity awards granted by the Company as of December 31, 2013.

				Option Awards											Stock Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable			Number of Securities Underlying Unexercised Options (#) Unexercisable		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)			Option Exercise Price Per Share ($)		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Mark A. Smith		8,000,000	(1)		—		—			.50		12-01-2017		—		—		—	—
Mark A. Smith		—			—		3,000,000	(2)		.07		10-18-2023		—		—		—	—
Troy G. Taggart		—			—		—			—		—		—		—		—	—
Troy G. Taggart		—			—		3,000,000	(2)		.07		10-18-2023		—		—		—	—
Thomas R. Oxenreiter		100,000	(3)		—		—			.80		3-13-2018		—		—		—	—
Thomas R. Oxenreiter		—			—		3,000,000	(2)		.07		10-18-2023		—		—		—	—

(1)	Option to purchase 8,000,000 shares of common stock at $.50 per share granted December 1, 2007, vested on December 1, 2007, and expires on December 1, 2017.
(2)	Stock appreciation rights on 3,000,000 shares of common stock at $0.07 per share granted October 18, 2013, vested one-third on October 18, 2013, and vests one-third on October 18, 2014, and one-third on October 18, 2015. The stock appreciation rights expire on October 18, 2023.
(3)	Option to purchase 100,000 shares of Common Stock at $0.80 per share granted March 13, 2008, vested one-third on March 13, 2009, one-third on March 13, 2010, and one-third on March 13, 2011. The option expires on March 13, 2018.

Director Compensation

Other than compensation of Named Executive Officers disclosed in the Summary Compensation Table, the Company did not pay any compensation to Directors.

Employment Agreements and Change in Control Arrangements

On October 18, 2013, the Company entered into an Employment Agreement with Mark A. Smith, the Company’s Chairman and Chief Executive Officer (the “2013 Smith Employment Agreement”). The 2013 Smith Employment Agreement provides for a base salary of $320,000 per year, plus certain expenses and employee benefits, and an annual bonus dependent upon the attainment of certain performance measures. The 2013 Smith Employment Agreement has an initial expiration date of October 18, 2016, which expiration date is automatically extended by one day during each day of the term of the agreement so that the unexpired term is always three years, unless either Mr. Smith or the Company terminates the automatic extension provision.

Upon a change in control, as defined in the 2013 Smith Employment Agreement, and for six months thereafter, Mr. Smith may terminate the Smith Employment Agreement. Upon such termination, the Company must pay Mr. Smith a lump sum equal to two times Mr. Smith’s salary and annual bonus on the date of termination for the remaining term of the 2013 Smith Employment Agreement. Also upon such termination, all equity awards granted by the Company to Mr. Smith immediately vest and remain exercisable for their original term, and all employee benefits remain in place for one year.

Prior to October 18, 2013, the Company and Mr. Smith were parties to an Employment Agreement dated December 1, 2007 (the “2007 Smith Employment Agreement”), which provided for a base salary of $320,000 per year, plus certain expenses and employee benefits, and an annual bonus dependent upon the attainment of certain performance measures. The 2007 Smith Employment Agreement expired on November 30, 2010, after which it was automatically extended each day to the date one year from that day, until it was superseded by the 2013 Smith Employment Agreement. Pursuant to the 2007 Smith Employment Agreement, Mr. Smith was awarded options to purchase 8,000,000 shares of the Company’s common stock at an exercise price of $0.50 per share.

Upon a change in control, as defined in the 2007 Smith Employment Agreement, and for six months thereafter, Mr. Smith could terminate the 2007 Smith Employment Agreement. Upon such termination, the Company would pay Mr. Smith a lump sum equal to Mr. Smith’s salary and target bonus on the date of termination for the remaining term of the 2013 Smith Employment Agreement. Also upon such termination, all equity awards granted by the Company to Mr. Smith would immediately vest and remain exercisable for their original term, and all employee benefits would remain in place for one year.

On October 18, 2013, the Company entered into an Employment Agreement with Thomas R. Oxenreiter, the Company’s Chief Financial Officer (the “Oxenreiter Employment Agreement”). The Oxenreiter Employment Agreement provides for a base salary of $175,000 per year, plus certain expenses and employee benefits, and an annual bonus dependent upon the attainment of certain performance measures. The Oxenreiter Employment Agreement has an initial expiration date of October 18, 2016, which expiration date is automatically extended by one day during each day of the term of the agreement so that the unexpired term is always three years, unless either Mr. Oxenreiter or the Company terminates the automatic extension provision.

Upon a change in control, as defined in the Oxenreiter Employment Agreement, and for six months thereafter, Mr. Oxenreiter may terminate the Oxenreiter Employment Agreement. Upon such termination, the Company must pay Mr. Oxenreiter a lump sum equal to Mr. Oxenreiter’s salary and annual bonus on the date of termination for the remaining term of the Oxenreiter Employment Agreement. Also upon such termination, all equity awards granted by the Company to Mr. Oxenreiter immediately vest and remain exercisable for their original term, and all employee benefits remain in place for one year.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Transactions with Related Persons

The Company leases its headquarters building from Mark A. Smith, the Company’s Chairman and Chief Executive Officer. The building has approximately 3,200 square feet of office space, and is used by the Company’s corporate, technical, and operations staff. The Company incurred $78,000 of lease expense for this building in each of the years ended December 31, 2012 and 2011. The lease is cancellable by either party upon 30 days’ notice.

At December 31, 2010, the Company owed Mr. Smith $149,911 on a note payable (the “Smith Note”). Interest on the Smith Note at 8% amounted to $8,336, $13,514, and $12,443 for the years ended December 31, 2013, 2012 and 2011, respectively. The balance due on the Smith Note was $175,867 and $162,354 at December 31, 2012 and 2011, respectively. The Smith Note was converted to shares of the Company’s common stock, and warrants to purchase the Company’s common stock on August 20, 2013, as described below.

At December 31, 2010, the Company owed Mr. Smith $33,073 on a convertible note payable (the “Convertible Note”). The Convertible Note was convertible to the Company’s common stock at a price of $1.00 per share. Interest on the Convertible Note at 8% amounted to $1,839, $2,981, and $2,745 for the years ended December 31, 2013, 2012 and 2011, respectively. The balance due on the Convertible Note was $38,799 and $35,818 at December 31, 2012 and 2011, respectively. The Convertible Note was converted to shares of the Company’s common stock, and warrants to purchase the Company’s common stock on August 20, 2013, as described below.

At December 31, 2010, the Company owed Mr. Smith $140,803 on a demand note payable (the “Demand Note”). Interest on the Demand Note at 8% amounted to $7,830, $12,692, and $11,687 for the years ended December 31, 2013, 2012 and 2011, respectively. The balance due on the Demand Note was $165,182 and $152,489 at December 31, 2012 and 2011, respectively. The Demand Note was converted to shares of the Company’s common stock, and warrants to purchase the Company’s common stock on August 20, 2013, as described below.

On November 9, 2012, the Company and Mr. Smith entered into a Lease Agreement, pursuant to which the Company leases equipment from Mr. Smith. The lease is for 60 months, and is for substantially the same terms for which Mr. Smith leases the equipment from the manufacturer. Interest on the lease amounted to $439 and $41 for the years ended December 31, 2013 and 2012, respectively.

On August 20, 2013, the Company and Mr. Smith entered into a Conversion Agreement (the “Smith Conversion Agreement”), pursuant to which liabilities of the Company to Mr. Smith totaling $1,253,644 were converted to 17,909,203 shares of the Company’s common stock and warrants to purchase 1,790,920 shares of the Company’s common stock at an exercise price of $0.25 per share. The liabilities to Mr. Smith included $573,635 of accrued salary, $282,156 of unreimbursed business expenses and unpaid rent for the Company’s offices, $184,204 for unpaid principal and accrued interest on the Smith Note, $40,638 for unpaid principal and accrued interest on the Convertible Note, and $184,204 for unpaid principal and accrued interest on the Demand Note. As required by the Smith Conversion Agreement, the Company paid taxes owed by Mr. Smith as a result of the conversion in the amount of $57,887. In addition to the liabilities to Mr. Smith converted pursuant to the Smith Conversion Agreement, the Company agreed to use reasonable commercial efforts to pay additional accrued and unpaid salary of $97,500, and additional unreimbursed business expenses and unpaid rent of $21,366.

On August 20, 2013, the Company and Thomas R. Oxenreiter, the Company’s Chief Financial Officer, entered into a Conversion Agreement (the “Oxenreiter Conversion Agreement”), pursuant to which accrued and unpaid salary of $223,959 and unreimbursed business expenses of $12,062 owed to Mr. Oxenreiter were converted to 3,371,719 shares of the Company’s common stock and warrants to purchase 337,172 shares of the Company’s common stock at an exercise price of $0.25 per share. As required by the Oxenreiter Conversion Agreement, the Company paid taxes owed by Mr. Oxenreiter as a result of the conversion in the amount of $18,925. In addition to the liabilities to Mr. Oxenreiter converted pursuant to the Conversion Agreement, the Company agreed to use reasonable commercial efforts to pay additional accrued salary of $31,250, and additional unreimbursed business expenses of $1,759.

In 2010, the Company entered into a Strategic Advisory Agreement (the “Strategic Advisory Agreement”) with Pace Global Energy Services, LLC (“Pace”) and Ridge Global, LLC (“Ridge”) to provide the Company with certain strategic advisory and other support services. Pursuant to the Strategic Advisory Agreement, the Company issued Pace and Ridge warrants to purchase 1,600,000 and 2,400,000 shares, respectively, of the Company’s common stock. Such warrants expired on March 2, 2012. Further, pursuant to the Strategic Advisory Agreement, the Company agreed to expand the number of members of the Company’s Board of Directors from three to five, and to appoint Timothy F. Sutherland, Chairman and Chief Executive Officer of Pace, and Thomas J. Ridge, President and Chief Executive Officer of Ridge, to fill the newly-created vacancies. The Company incurred fees pursuant to the Strategic Advisory Agreement of $480,000 during the year ended December 31, 2011.

On October 19, 2010, the Company, Pace, and Ridge entered into a Fee Deferral Agreement and Promissory Note (the “Promissory Note”), pursuant to which the Company memorialized $238,030 of unpaid accounts payable owing to Pace and Ridge to the Promissory Note bearing interest at 10% per annum. Interest on the Promissory Note totaled $28,349 and $25,575 for the years ended December 31, 2012 and 2011, respectively. The balance due on the Promissory Note was $296,781 and $268,432 at December 31, 2012 and 2011, respectively.

Mr. Sutherland resigned his position on the Company’s Board of Directors on February 6, 2012, and Mr. Ridge resigned his position on the Company’s Board of Directors on May 31, 2012.

On February 28, 2013, the Company, Pace, Ridge, Mr. Sutherland, and Mr. Ridge entered into a Mutual Termination and Release Agreement, which terminated all prior agreements and released all parties from all obligations related to all prior agreements, including the Promissory Note. As a result of the Mutual Termination and Release Agreement, the Company recorded a gain on extinguishment of debt of $861,645.

SELLING STOCKHOLDERS

The shares being sold by the selling stockholders consists of 15,631,490 shares of the Company’s common stock. We are registering the common stock in order to permit the selling stockholders to offer the shares for resale from time to time. Except as indicated in the footnotes to the table below, the selling stockholders have not had any positions, office or other material relationship with us during the last three years.

The following table provides certain information with respect to the selling stockholders’ beneficial ownership of our common stock as of March 20, 2014, the total number of shares of common stock they may sell under this prospectus from time to time, and the number of shares of common stock they will own thereafter assuming no other acquisitions or dispositions of our securities. For the table below, beneficial ownership of the common stock is determined in accordance with the rules of the SEC and includes any shares of common stock over which a selling stockholder exercises sole or shared voting or investment powers, or of which a selling stockholder has a right to acquire ownership at any time within 60 days of March 20, 2014. The selling stockholders can offer all, some or none of their securities, and thus we have no way of determining the number they will hold after this offering. Therefore, we have prepared the table below on the assumption that the selling stockholders will sell all of the shares covered by this prospectus, in which case the number and percentage of shares of the common stock beneficially owned by each selling shareholder would be reduced to zero, except as set forth below.

We may amend or supplement this prospectus from time to time to update the disclosure set forth herein, however, if a selling stockholder transfers his or her interest in the common stock prior to the effective date of the registration statement of which this prospectus is a part, we will be required to file an amendment to the registration statement to provide the information concerning the transferee. Alternatively, if a selling stockholder transfers his or her interest in the common stock after the effective date of the registration statement of which this prospectus is a part, we may use a supplement to update this prospectus. See our discussion titled “Plan of Distribution” for further information regarding the selling stockholders’ method of distribution of these shares.

Name of Selling Stockholder	Shares of Common Stock Beneficially Owned Prior to the Offering		Shares of Common Stock Beneficially Owned After the Offering
24 W57, LLC		100,000		—
Abigail Larios		10,000		—
Anthony & Michelle Vinciguerra		10,000		—
Arthur Yorkes & Co. Profit Sharing Plan FBO Arthur Yorkes		44,500		—
Bernard Krzys		150,000		—
Brian J. Thorsen		50,000		—
Bruce D. Fletcher		15,000		—
Butterfield Trust (Bermuda) Limited		75,000		—
Capitol Outdoor LLC		50,000		—
Carlos Ubeda		7,000		—
Castle Re Insurance Company Ltd.		150,000		—
Dave Gertz		2,000		—
David Truitt		250,000		—
Delta Networks Ltd., SA		12,300,000		3,300,000
DJJ Monte Enterprise		395,000		—
Donald D. Wren Revocable Living Trust		100,000		—
Donald de Laski		1,000,000		—
Edward Brokaw		32,000		—
Ezra Lightman		25,000		—
Geoffrey O’Connor Coley		400,000		—
George F. Blacker		25,000		—
Gregg S. Monday Trust		35,000		—
Hernan Ubeda		10,000		—
Herrington Enterprises CV		40,000		—
Hoard Brodie		40,000		—
Horst Susskind		25,000		—

Jacqueline Blecher	15,000	—
James A. Brumbaugh	50,000	—
James Rudakewiz & Marianne Rudakewiz	75,000	—
Jeff Ross	75,000	—
Jim D. Wilk	25,000	—
John J. & Kathleen A. Weyandt	50,000	—
John M. Devlin, Jr.	10,000	—
John Martin Bloom Revocable Trust	75,000	—
Jon Buise	25,000	—
Jon M. Wickwire Trust	75,000	—
JW Partners, LP	71,000	—
Kelvin Clarke	20,000	—
Kenneth W. Arida	25,000	—
Kent L. Swanson	50,000	—
Landmarks Financial Corporation	400,000	—
Linda M. Ward	30,000	—
Louis Nicozisis	35,000	—
Mark A. Loewenstein	32,000	—
Marshall G. Folkes, III	200,000	—
Mary Ungar	20,000	—
Maurice Werdegar	100,000	—
Michael C. Loulakis	100,000	—
Michael H. Devlin II	20,000	—
Michael Schlesinger	50,000	—
Millennium for Camille Rader Roth IRA	50,000	—
Paul Sloan	50,000	—
Pensco Trust Co. Custodian FBO Steve B. Warnecke Roth IRA	85,000	—
Philip J. Tamminga	50,000	—
Philip Nicozisis	74,000	—
Ricardo Yulis	14,500	—
Richard & Susan Galen	20,000	—
Richard Marcus Profit Sharing Plan	50,000	—
Richard Molinsky	75,000	—
Robert & Jeanne Rucks	55,000	—
Robert Bryan	20,000	—
Robert H. Taggart, Jr. (1)	70,810	—
Robert M. Devlin	20,000	—
Robert Preston	50,000	—
Rockhill Pain Specialists, PA 401k Plan FBO Dina Kloster	50,000	—
Roger Conan	40,000	—
Ross T. Krueger	50,000	—
Russell Case	25,000	—
Sanjay Jatana	100,000	—
Scott Vesley	10,000	—
Spencer B. Heninger	50,000	—
Steve B. Warnecke	30,000	—
Steven L. Kohler	10,000	—
TDF, LLC Safe Harbor 401(k) Plan FBO Thomas D. Fertitta	17,000	—
Theodore London	2,350	—
Thomas D. Fertitta	20,000	—
Thomas F. Erickson	200,000	—
Thomas F. Gilbertson	200,000	—
Thomas N. Bryant & Joanne M. Bryant	50,000	—
Thomas Witz	100,000	—
Todd Dickert	20,000	—
Todd R. Porter	10,000	—
Tom Ridge (2)	50,000	—
Tom Werthan	90,000	—

Troy Gerard Taggart Revocable Trust (3)	74,330	—
Venture Source Inc.	25,000	—
William S. Eber	30,000	—
Winston D. Wren Revocable Living Trust	25,000	—

* Less than 1%

(1)	Robert H. Taggart, Jr. provided services to the Company for a fee during the last three years.
(2)	Tom Ridge served as a director of the Company during 2011 and 2012.
(3)	Troy G. Taggart, grantor of the Troy Gerard Taggart Revocable Trust, provided services to the Company for a fee during the last three years, and has served as the Company’s president since 2013.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT

The following table sets forth information, as of March 20, 2014, regarding beneficial ownership of our common stock and Series B Convertible Preferred Stock (“Series B Stock”) to the extent known to us, by:

(i) each person who is known by us to own beneficially more than 5% of our outstanding shares of common stock or Series B Stock (each a “5% Stockholder”);

(ii) each Director;

(iii) each Named Executive Officer;and

(iv) all of our Directors and Named Executive Officers as a group.

We have determined beneficial ownership in accordance with the Rules of the SEC. Unless otherwise noted, we believe that each person named in the table has sole voting and investment power with respect to all shares of our common stock or Series B Stock that he or she beneficially owns.

Applicable percentage ownership of common stock is based on 91,432,667 shares of common stock outstanding and applicable percentage ownership of Series B Stock is based on 3,804,358 shares of Series B Stock outstanding. For purposes of these tables, a person is deemed to be the beneficial owner of securities that can be acquired by such person within 60 days from March 20, 2014 upon exercise of options, warrants and convertible securities. Each beneficial owner’s percentage ownership is determined by assuming that options, warrants and convertible securities that are held by such person (but not those held by any other person) and that are exercisable within 60 days from the date hereof have been exercised. Unless otherwise indicated, the address of each 5% Stockholder, Director and Named Executive Officer is 229 Howes Run Road, Sarver, PA 16055.

	Shares Beneficially Owned										% of Total Voting Power
	Prior to this Offering										Before the
	Common Stock					Series B					Offering
Name of Beneficial Owner	Shares			%		Shares			%		%
Named Executive Officers and Directors:
Mark A. Smith		34,732,684	⁽²⁾		34.0		—			—	26.8
Thomas R. Oxenreiter		4,829,608	⁽³⁾		5.2		—			—	3.7
Troy G. Taggart		2,186,375	⁽⁴⁾		2.4		—			—	1.7
All executive officers and directors as a group (3) persons		41,748,667	⁽⁵⁾		39.8						32.2
Other 5% Stockholders:
Lesa Smith		23,941,764	⁽⁶⁾		26.2		—			—	17.9
Delta Networks Limited SA ⁽⁷⁾		12,300,000	⁽⁸⁾		13.0		—			—	9.5
Anthony F. Hovey ⁽⁹⁾		8,950,565	⁽¹⁰⁾		9.2		550,000	⁽¹¹⁾		14.3	6.9
Lowery Enterprise, LLC ⁽¹²⁾		6,378,560	⁽¹³⁾		6.5		337,856	⁽¹⁴⁾		8.8	4.9
Matthew F. Bensen ⁽¹⁵⁾		6,072,440	⁽¹⁶⁾		6.2		685,814	⁽¹⁷⁾		17.7	4.7
Pat Manuel ⁽¹⁸⁾		4,714,280	⁽¹⁹⁾		4.9		471,428	⁽²⁰⁾		12.3	3.6
Bret Shepard ⁽²¹⁾		2,865,360			3.0		286,536	⁽²²⁾		7.5	2.2

⁽¹⁾	Percentage of total voting power represents voting power with respect to all shares of our common stock and Series B Stock, as a single class. The holders of our Series B Stock are entitled to ten votes per share, and holders of our common stock are entitled to one vote per share. For more information about the voting rights of our common stock and Series B Stock, see “Description of Capital Stock.”
⁽²⁾	Includes 23,941,764 shares of common stock jointly owned by Mr. Smith and his wife, Lesa A. Smith, and 10,790,920 shares of common stock issuable upon exercise of outstanding options, stock appreciation rights, and warrants.
⁽³⁾	Includes 3,392,436 shares of common stock jointly owned by Mr. Oxenreiter and his wife, Emily J. Oxenreiter, and 1,437,172 shares of common stock issuable upon exercise of outstanding options, stock appreciation rights, and warrants.

⁽⁴⁾	Includes 74,330 shares of common stock owned by a revocable trust controlled by Mr. Taggart, and 1,112,045 shares of common stock issuable upon exercise of outstanding options, stock appreciation rights, and warrants.
⁽⁵⁾	Includes 13,340,137 shares of common stock issuable upon exercise of outstanding options, stock appreciation rights, and warrants.
⁽⁶⁾	Represents shares owned jointly by Mrs. Smith and her husband, Mark A. Smith.
⁽⁷⁾	The address for Delta Networks Limited SA is Molenberglei 42, 2627 Scheibe, Belgium
⁽⁸⁾	Includes 300,000 shares of common stock owned by a wholly-owned subsidiary of Delta Networks, Ltd., SA, and 3,000,000 shares of common stock issuable upon exercise of outstanding warrants.
⁽⁹⁾	The address for Anthony F. Hovey is Skyline at First Hill, 725 9 ^th Avenue, Seattle, WA 98104
⁽¹⁰⁾	Includes 20,927 shares of common stock issuable upon exercise of outstanding warrants, and 5,000,000 shares of common stock issuable upon conversion of Series B Stock, and 500,000 shares of common stock issuable upon exercise of outstanding warrants to purchase shares of Series B Stock and subsequent conversion of such shares of Series B Stock to common stock.
⁽¹¹⁾	Includes 50,000 shares of Series B Stock issuable upon exercise of outstanding warrants.
⁽¹²⁾	The address for Lowery Enterprises, LLC is 7470 SW Westgate Way, Portland, OR 97225
⁽¹³⁾	Includes 3,000,000 shares of common stock issuable upon exercise of outstanding warrants and 3,071,420 shares of common stock issuable upon conversion of Series B Stock and 307,140 shares of common stock issuable upon exercise of outstanding warrants to purchase shares of Series B Stock and subsequent conversion of such shares of Series B Stock to common stock.
⁽¹⁴⁾	Includes 30,714 shares of Series B Stock issuable upon exercise of outstanding warrants.
⁽¹⁵⁾	The address for Matthew F. Bensen is 20961, Nightshade Rd., Ashburn, VA 20147
⁽¹⁶⁾	Includes 5,520,400 shares of common stock issuable upon conversion of Series B Stock, and 552,040 shares of common stock issuable upon exercise of outstanding warrants to purchase shares of Series B Stock and subsequent conversion of such shares of Series B Stock to common stock.
⁽¹⁷⁾	Includes 62,346 shares of Series B Stock issuable upon exercise of outstanding warrants.
⁽¹⁸⁾	The address for Pat Manuel is P. O. Box 1046, Eunice, LA 70535
⁽¹⁹⁾	Includes 4,285,710 shares of common stock issuable upon conversion of Series B Stock, and 428,570 shares of common stock issuable upon exercise of outstanding warrants to purchase shares of Series B Convertible Preferred Stock and subsequent conversion of such shares of Series B Stock to common stock.
⁽²⁰⁾	Includes 42,857 shares of Series B Stock issuable upon exercise of outstanding warrants.
⁽²¹⁾	The address for Bret Shephard is 5404 Chandley Farm Circle, Centerville, VA 20120.
⁽²²⁾	Includes 26,048 shares of Series B Stock issuable upon exercise of outstanding warrants.

DESCRIPTION OF CAPITAL STOCK

Common Stock

We are authorized to issue up to 350,000,000 shares of common stock, par value $0.001 per share.

Each outstanding share of common stock entitles the holder thereof to one vote per share on all matters. Our bylaws provide that, in voting for election of directors, the persons receiving the greatest number of votes shall be elected as the directors. Stockholders do not have preemptive rights to purchase shares in any future issuance of our common stock.

Dividends, if any, will be contingent upon the Company’s revenues and earnings, if any, and the capital requirements and financial condition of the Company. The payment of dividends, if any, will be within the discretion of the Company’s Board of Directors. The Company presently intends to retain all earnings, if any, for use in its business operations and accordingly, the Board of Directors does not anticipate declaring any dividends.

In the event of our liquidation, dissolution or winding up, after payment of all our creditors and payment to the holder of Series B Stock of an amount equal to 150% of the original issue price of such shares of Series B Stock, holders of our common stock are entitled to receive, ratably with the holders of Series B Stock on an as-converted basis, our remaining net assets. All of the issued and outstanding shares of our common stock are duly authorized, validly issued, fully paid and non-assessable. To the extent that additional shares of our common or preferred stock are issued, the relative interests of existing stockholders will be diluted.

Preferred Stock

The Company is authorized to issue up to 25,000,000 shares of preferred stock, $.001 par value. Any voting powers, designations, preferences, limitations, restrictions, relative rights and distinguishing designation of shares of the Company’s preferred stock are determined by the Board of Directors at issuance.

On August 20, 2013, the Company filed a Certificate of Withdrawal of Certificate of Designation with the Secretary of State of Nevada to withdraw its previously filed Certificate of Designation establishing the Series A Convertible Preferred Stock of the Company. As of the date of such filing, there were no shares of Series A Convertible Preferred Stock outstanding.

On August 20, 2013, the Company filed a Certificate of Designation with the Secretary of State of Nevada to designate 5,000,000 shares of its preferred stock as Series B Convertible Preferred Stock (“Series B Stock”) for issuance by the Company. Each share of Series B Stock is convertible into ten shares of common stock at the option of the holder, or automatically upon the earliest to occur of: (i) immediately prior to the closing of a firm commitment underwritten public offering pursuant to an effective registration statement filed under the Securities Act, in which shares of common stock are approved for listing on a national securities market, covering the offer and sale of common stock for the account of the Company in which the aggregate public offering price (before deduction of underwriters’ discounts and commissions) equals or exceeds $30,000,000 and the public offering price per share of which equals or exceeds $2.10, before deduction of underwriters’ discounts and commissions; and (ii) the Company’s receipt of the written consent of the holders of not less than a majority of the then outstanding shares of Series B Stock to the conversion of all then outstanding shares of Series B Stock.

The holders of Series B Stock have the same voting rights and dividend participation rights as holders of common stock in proportion to the number of shares of common stock the holders of Series B Stock would hold if those shares were converted to common stock. The holders of Series B Stock are entitled to a liquidation preference equal to 150% of the original issue price of such Series B Stock, after payment of which they participate in liquidation with the holders of common stock.

Warrants

The following warrants to purchase our common stock are outstanding:

Date issued	Number of Shares		Exercise Price		Expiration Date
January 24, 2008		87,545	$	0.55	January 24, 2018
January 30, 2009		22,500	$	0.55	January 30, 2019
March 10, 2009		20,927	$	1.50	March 10, 2014
September 29, 2009		195,300	$	0.55	September 29, 2019
October 30, 2009		1,590,000	$	1.00	March 6, 2019
January 7, 2010		250,000	$	1.38	January 7, 2020
December 5, 2011		3,000,000	$	0.10	December 5, 2016
December 1, 2012		225,000	$	0.15	November 30, 2015
August 20, 2013		2,128,092	$	0.25	August 20, 2018
September 30, 2013		149,998	$	0.25	September 30, 2018
October 22, 2013		3,000,000	$	0.50	December 31, 2015

Options

On September 23, 2013, the Company adopted the 2013 Equity Incentive Plan (the “2013 Plan”), pursuant to which up to 25,000,000 shares of the Company’s common stock are available for grants of awards, including incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, performance share awards, and performance compensation awards to eligible employees, consultants, and directors, provided that no more than 15,000,000 shares of common stock may be granted as incentive stock options. The Board of Directors has reserved 25,000,000 shares of the Company’s common stock for issuance under the 2013 Plan. During the year ended December 31, 2013, the Company granted stock appreciation rights on 15,900,000 shares of common stock to eligible employees and consultants at an exercise price of $0.07 per share.

In 2007, the Company adopted the 2007 Stock Option Plan (the “2007 Plan”), pursuant to which the Compensation Committee of the Board of Directors (the “Committee”) may award grants of options to purchase up to 15,000,000 shares of the Company’s common stock to eligible employees, directors, and consultants, subject to exercise prices and vesting requirements determined by the Committee. On September 23, 2013, the Company reduced the number of shares of the Company’s common stock that may be subject to awards under the 2007 Plan to 9,050,000. The Board of Directors has reserved 9,050,000 shares of the Company’s common stock for issuance under the 2007 Plan. The Company granted options to purchase 220,000 shares of the Company’s common stock to eligible employees at an exercise price of $0.33 during the year ended December 31, 2011.

Transfer Agent

Our Transfer Agent is Interwest Transfer Co., Inc. located at 1981 East Murray Holladay Road, Suite 100, Salt Lake City, Utah 84107.

SHARES ELIGIBLE FOR FUTURE SALE

As of March 20, 2014, we had outstanding 91,432,667 shares of common stock and 3,804,358 shares of Series B Stock, which are convertible into 38,043,580 shares of common stock.

Shares Covered by This Prospectus

The securities being offered by this prospectus are 15,631,490 shares of the Company’s common stock owned by the selling stockholders. All of the shares of common stock being registered in this offering may be sold without restriction under the Securities Act, so long as the registration statement of which this prospectus is a part is, and remains, effective.

Other Shares Likely to Become Freely Tradable

Approximately 12,048,519 shares of our common stock are currently unrestricted and freely tradable on the OTC Pink Marketplace where the Company’s common stock trades. In addition, 15,631,490 shares of our common stock have been registered for sale pursuant to this prospectus upon the effectiveness of the related registration statement. Of our remaining outstanding shares, as of the date of this prospectus, some of such shares may be eligible for resale under Rule 144 under the Securities Act depending on (i) certain conditions relating to the Company or the shares themselves, including whether, among other things, (A) the Company is, and has been for a period of at least 90 days immediately before the sale, subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, and the Company has filed all required Exchange Act reports and material during the preceding twelve months (or such shorter period that the Company was required to file such reports), and (B) certain conditions relating to the investors who hold such shares, including, among other things, (i) the period for which such investors held such shares and (ii) such investor’s relationship with the Company.

PLAN OF DISTRIBUTION

The selling stockholders and any of their pledgees, donees, transferees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of the Company’s common stock on the OTC Pink Marketplace, at fixed or negotiated prices or in any stock exchange, market or trading facility on which the shares are traded or in private transactions. The selling stockholders may use any one or more of the following methods when selling shares:

	•	ordinary brokerage transactions and transactions in which the broker-dealer solicits investors;
	•	block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
	•	purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
	•	an exchange distribution in accordance with the rules of the applicable exchange;
	•	privately negotiated transactions;
	•	to cover short sales made after the date that the registration statement of which this prospectus is a part is declared effective by the Commission;
	•	through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
	•	broker-dealers may agree with the selling security holder to sell a specified number of such shares at a stipulated price per share;
	•	a combination of any such methods of sale; and
	•	any other method permitted pursuant to applicable law.

The selling stockholders may also sell shares in transactions exempt from the registration requirements of the Securities Act, including under Rule 144 thereunder, if available, rather than under this prospectus.

Broker-dealers engaged by the selling stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated. The selling stockholders do not expect these commissions and discounts to exceed what is customary in the types of transactions involved.

The selling stockholders may from time to time pledge or grant a security interest in some or all of the shares owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell shares of common stock from time to time under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provisions of the Securities Act amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus.

In connection with the sale of our common stock or interests therein, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

Upon the Company being notified in writing by a selling stockholder that any material arrangement has been entered into with a broker-dealer for the sale of common stock through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker or dealer, a supplement to this prospectus will be filed, if required, pursuant to Rule 424(b) under the Securities Act, disclosing (i) the name of each such selling security holder and of the participating broker-dealer(s), (ii) the number of shares involved, (iii) the price at which such the shares of common stock were sold, (iv) the commissions paid or discounts or concessions allowed to such broker-dealer(s), where applicable, (v) that such broker-dealer(s) did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus, and (vi) other facts material to the transaction. In addition, upon the Company being notified in writing by a selling security holder that a donee or pledgee intends to sell shares of common stock, a supplement to this prospectus will be filed if then required in accordance with applicable securities law.

The selling stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors-in-interest will be the selling beneficial owners for purposes of this prospectus.

The selling stockholders and any broker-dealers or agents that are involved in selling the shares may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Discounts, concessions, commissions and similar selling expenses, if any, that can be attributed to the sale of securities will be paid by the selling stockholders and/or the purchasers. Each selling security holder has represented and warranted to the Company that it acquired the securities subject to this registration statement in the ordinary course of such selling security holder’s business and, at the time of its purchase of such securities, such selling stockholder had no agreements or understandings, directly or indirectly, with any person to distribute any such securities.

The Company has advised each selling stockholder that it may not use shares registered on the registration statement of which this prospectus is a part to cover short sales of common stock made prior to the date on which the registration statement, of which this prospectus is a part, shall have been declared effective by the Commission. If a selling stockholder uses this prospectus for any sale of common stock, it will be subject to the prospectus delivery requirements of the Securities Act. The selling stockholders will be responsible for complying with the applicable provisions of the Securities Act and the Exchange Act, and the rules and regulations thereunder promulgated, including, without limitation, Regulation M, as applicable to such selling stockholders in connection with resales of their respective shares under the registration statement of which this prospectus is a part.

The Company is required to pay all fees and expenses incident to the registration of the shares, but the Company will not receive any additional proceeds from the sale of the common stock registered under this prospectus.

We agreed to keep this prospectus effective until the earlier of (i) the date on which the shares may be resold by the selling stockholders without registration and without regard to any limitations by reason of Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of the shares have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect. The resale shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the selling stockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock by the selling stockholders or any other person. We will make copies of this prospectus available to the selling stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Our amended articles of incorporation provide that none of our directors and officers shall be personally liable to the Company or our stockholders for monetary damages for any breach of fiduciary duty by such person as a director or officer. Notwithstanding the foregoing, a director or officer shall be liable to the extent provided by applicable law, (i) for acts or omissions which involve intentional misconduct, fraud or a knowing violation of law, or (ii) for the payment of dividends in violation of applicable law. We indemnify our directors and officers to the maximum extent permitted by Nevada law for the costs and liabilities of acting or failing to act in an official capacity. We also have insurance in the aggregate amount of $5 million for our directors and officers against all of the costs of such indemnification or against liabilities arising from acts or omissions of the insured person in cases where we may not have power to indemnify the person against such liabilities.

The Company and its officers have been sued in the Court of Common Pleas of Butler County, Pennsylvania, by a group of investors alleging misrepresentation regarding the plaintiffs’ investments in the Company. We have denied the allegations and believe that we will prevail should the case go to trial. Other than such action, there is no pending litigation or proceeding involving a director, officer, employee or other agent of ours in which indemnification would be required or permitted. We are not aware of any threatened litigation or proceeding which may result in a claim for such indemnification.

Insofar as indemnification by us for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to provisions of the Certificate of Incorporation and Bylaws, or otherwise, we have been informed that in the opinion of the SEC, such indemnification is against public policy and is, therefore, unenforceable.

LEGAL MATTERS

Certain legal matters have been passed upon on behalf of the Company by Sherrard, German & Kelly, P.C., Pittsburgh, Pennsylvania. Certain matters of Nevada Law are being passed upon by Woodburn and Wedge, Attorneys and Counselors at Law, Reno, Nevada.

EXPERTS

The consolidated balance sheets of Geospatial Corporation and Subsidiaries as of December 31, 2012 and 2011, and the related consolidated statements of operations, changes in stockholders’ deficit, and cash flows for each of the two years in the period ended December 31, 2012 have been audited by Goff Backa Alfera & Company, LLC, Certified Public Accountants, as stated in its report appearing herein and elsewhere in the registration statement. Such financial statements have been so included in reliance upon the report of such firm given upon its authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a Registration Statement on Form S-1 under the Securities Act with respect to the common stock offered in this offering. This prospectus does not contain all of the information set forth in the registration statement. For further information with respect to us and the Common Stock offered in this offering, we refer you to the registration statement and to the attached exhibits. With respect to each such documents filed as an exhibit to the registration statement, we refer you to the exhibit for a more complete description of the matters involved.

You may inspect our registration statement and the attached exhibits and schedules without charge at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549, on official business days during the hours of 10:00 am to 3:00 pm. You may obtain copies of all or any part of our registration statement from the SEC upon payment of prescribed fees. You may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330.

Our SEC filings, including the registration statement and the exhibits filed with the registration statement, are also available from the SEC’s website at www.sec.gov, which contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

As a result of the registration, we are subject to the full informational requirements of the Exchange Act and are required to file periodic reports and other information with the SEC. We intend to furnish our stockholders with annual reports containing consolidated financial statements certified by an independent public accounting firm.

GEOSPATIAL CORPORATION

INDEX

		Page
Report of Independent Registered Public Accounting Firm		F-2

Financial Statements as of September 30, 2013 (Unaudited), and as of December 31, 2012 and 2011 (Audited), and for the Nine Months Ended September 30, 2013 (Unaudited) and for the Years Ended December 31, 2012 and 2011 (Audited)

Consolidated Balance Sheets		F-3

Consolidated Statements of Operations		F-4

Consolidated Statements of Changes in Stockholders’ Deficit		F-5

Consolidated Statements of Cash Flows		F-6

Notes to Consolidated Financial Statements		F-7

F- 1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and

Stockholders of Geospatial Corporation

We have audited the accompanying consolidated balance sheets of Corporation (a Nevada corporation) as of December 31, 2012 and 2011, and the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for the years then ended. These consolidated financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Geospatial Corporation as of December 31, 2012 and 2011, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 1 to the financial statements, the Company has incurred net losses since inception, operations and capital requirements since inception have been funded by sales of stock and advances from its chief executive officer and current liabilities exceed current assets by $5,635,189. These conditions raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Goff Backa Alfera and Company, LLC

Pittsburgh, Pennsylvania

March 25, 2014

F- 2

Geospatial Corporation and Subsidiaries

Consolidated Balance Sheets

	September 30,			December 31,			December 31,
	2013			2012			2011
	(Unaudited)

ASSETS

Current assets:
Cash and cash equivalents	$	256,234		$	3,928		$	158,849
Accounts receivable		203,400			—			10,550
Costs and estimated earnings in excess of billings on uncompleted contracts		—			—			21,789
Prepaid expenses and other current assets		178,272			109,309			67,614

Total current assets		637,906			113,237			258,802

Property and equipment:
Field equipment		48,788			36,363			—
Field vehicles		43,285			16,870			—

Total property and equipment		92,073			53,233			—
Less: accumulated depreciation		(19,187	)		(3,760	)		—

Net property and equipment		72,886			49,473			—

Other assets:
Deposits on equipment		50,000			—			—

Total assets	$	760,792		$	162,710		$	258,802

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:
Accounts payable	$	916,378		$	1,016,809		$	1,011,800
Accrued expenses		3,757,186			4,836,596			5,188,697
Billings in excess of costs and estimated earnings on uncompleted contracts		—			—			86,195
Due to related parties		34,398			878,913			796,827
Notes payable to related parties		—			676,629			619,093
Current portion of capital lease liability to related party		3,259			3,189			—
Senior convertible redeemable notes, net of deferred debt issue costs		1,419,716			1,414,331			1,233,624
Notes payable		142,158			332,877			342,152

Total current liabilities		6,273,095			9,159,344			9,278,388

Non-current liabilities:
Notes payable		308,494			383,738			—
Capital lease liability to related party		10,966			13,419			—
Accrued registration payment arrangement		997,599			1,066,977			1,070,127
Other non-current liabilities		22,798			30,611			—

Total non-current liabilities		1,339,857			1,494,745			1,070,127

Total liabilities		7,612,952			10,654,089			10,348,515

Commitments and contingencies		—			—			—

Stockholders’ deficit:
Preferred stock:
Undesignated, $0.001 par value; 0, 3,425,000 and 3,425,000 shares authorized at September 30, 2013, December 31, 2012, and December 31, 2011, respectively; no shares issued and outstanding at September 30, 2013, December 31, 2012, and December 31, 2011		—			—			—
Series A Convertible Preferred Stock, $0.001 par value; 0, 1,575,000, and 1,575,000 shares authorized at September 30, 2013, December 31, 2012, and December 31, 2011, respectively; no shares issued and outstanding at September 30, 2013, December 31, 2012, and December 31, 2011		—			—			—
Series B Convertible Preferred Stock, $0.001 par value; 5,000,000, 0, and 0 shares authorized at September 30, 2013, December 31, 2012, and December 31, 2011, respectively; 4,517,572, 0, and 0 shares issued and outstanding at September 30, 2013, December 31, 2012, and December 31, 2011, respectively		4,518			—			—
Common stock, $.001 par value; 100,000,000 shares authorized at September 30, 2013, December 31, 2012 and December 31, 2011; 69,752,667, 45,980,623 and 43,935,623 shares issued and outstanding at September 30, 2013, December 31, 2012, and December 31, 2011, respectively		69,753			45,981			43,936
Series B Convertible Preferred Stock subscribed		—			846,685			—
Additional paid-in capital		27,660,883			22,869,831			22,728,726
Accumulated deficit		(34,587,314	)		(34,253,876	)		(32,862,375	)

Total stockholders’ deficit		(6,852,160	)		(10,491,379	)		(10,089,713	)

Total liabilities and stockholders’ deficit	$	760,792		$	162,710		$	258,802

The accompanying notes are an integral part of these consolidated financial statements.

F- 3

Geospatial Corporation and Subsidiaries
Consolidated Statements of Operations

	For the Years Ended						For the Nine Months Ended
	December 31,						September 30,
	2012			2011			2013			2012
							(Unaudited)

Sales	$	336,672		$	387,282		$	494,738		$	336,672
Cost of sales		145,916			359,684			162,781			136,595

Gross profit		190,756			27,598			331,957			200,077

Selling, general and administrative expenses		1,256,128			2,051,661			1,194,556			932,022

Net loss from operations		(1,065,372	)		(2,024,063	)		(862,599	)		(731,945	)

Other income (expense):
Interest expense, net of interest income		(335,900	)		(233,855	)		(380,521	)		(210,790	)
Gain on extinguishment of debt		1,733			—			909,682			1,733
Other income		8,038			606			—			7,085

Total other income and expenses		(326,129	)		(233,249	)		529,161			(201,972	)

Net loss before income taxes and discontinued operations		(1,391,501	)		(2,257,312	)		(333,438	)		(933,917	)

Provision for income taxes		—			—			—			—

Net loss before discontinued operations		(1,391,501	)		(2,257,312	)		(333,438	)		(933,917	)

Income from discontinued operations, net of income taxes		—			14,127			—			—

Net loss	$	(1,391,501	)	$	(2,243,185	)	$	(333,438	)	$	(933,917	)

Basic and fully-diluted net loss per share of common stock	$	(0.03	)	$	(0.05	)	$	(0.01	)	$	(0.02	)

The accompanying notes are an integral part of these consolidated financial statements.

F- 4

Geospatial Corporation and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Deficit

For the Years Ended December 31, 2012 and 2011 (Audited); and for the Nine Months Ended September 30, 2013 (Unaudited)

	Preferred Stock				Common Stock				Series B Convertible Preferred Stock			Additional Paid-In		Accumulated
	Shares		Amount		Shares		Amount		Subscribed			Capital		Deficit			Total

Balance, December 31, 2010		—	$	—		43,433,123	$	43,433	$	—		$	22,694,053	$	(30,619,190	)	$	(7,881,704	)

Issuance of common stock for registration penalty		—		—		502,500		503		—			34,673		—			35,176

Net loss for the year ended December 31, 2011		—		—		—		—		—			—		(2,243,185	)		(2,243,185	)

Balance, December 31, 2011		—		—		43,935,623		43,936					22,728,726		(32,862,375	)		(10,089,713	)

Issuance of common stock for registration penalty		—		—		45,000		45		—			3,105		—			3,150

Issuance of common stock for services		—		—		2,000,000		2,000		—			138,000		—			140,000

Series B Convertible Preferred Stock subscribed		—		—		—		—		631,685			—		—			631,685

Series B Convertible Preferred Stock subscribed in settlement of liabilities		—		—		—		—		215,000			—		—			215,000

Net loss for the year ended December 31, 2012		—		—		—		—		—			—		(1,391,501	)		(1,391,501	)

Balance, December 31, 2012		—		—		45,980,623		45,981		846,685			22,869,831		(34,253,876	)		(10,491,379	)

Issuance of common stock for registration penalty		—		—		991,120		991		—			68,387		—			69,378

Issuance of common stock in settlement of liabilities		—		—		21,280,922		21,281		—			1,468,384		—			1,489,665

Sale of common stock, net of issuance costs		—		—		1,500,002		1,500		—			103,339		—			104,839

Sale of Series B Preferred Stock, net of issuance costs		3,469,330		3,470		—		—		(631,685	)		2,633,220		—			2,005,005

Issuance of Series B Preferred Stock in settlement of liabilites		1,048,242		1,048		—		—		(215,000	)		517,722		—			303,770

Net loss for the nine months ended September 30, 2013		—		—		—		—		—			—		(333,438	)		(333,438	)

Balance, September 30, 2013		4,517,572	$	4,518		69,752,667	$	69,753	$	—		$	27,660,883	$	(34,587,314	)	$	(6,852,160	)

The accompanying notes are an integral part of these consolidated financial statements.

F- 5

Geospatial Corporation and Subsidiaries
Consolidated Statements of Cash Flows

	For the Years Ended						For the Nine Months Ended
	December 31,						September 30,
	2012			2011			2013			2012
							(Unaudited)

Cash flows from operating activities:
Net loss	$	(1,391,501	)	$	(2,243,185	)	$	(333,438	)	$	(933,917	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		3,760			—			15,427			407
Amortization of deferred debt issue costs		42,953			32,894			27,814			31,110
Gain on extinguishment of debt		(1,733	)		—			(909,682	)		(1,733	)
Issuance of common stock for services		140,000			—			—			140,000
Accrued interest payable		274,021			178,309			338,897			166,311
Changes in operating assets and liablities:
Accounts receivable		10,550			393,770			(203,400	)		3,670
Costs and estimated earnings in excess of billings on uncompleted contracts		21,789			17,753			—			21,789
Prepaid expenses and other current assets		(41,695	)		189,832			(68,963	)		(107,640	)
Accounts payable		6,742			(35,936	)		471,449			73,527
Accrued expenses		359,109			673,580			(174,169	)		335,360
Billings in excess of costs and estimated earnings on uncompleted contracts		(86,195	)		72,527			—			(86,195	)
Due to related parties		82,086			564,290			(562,359	)		70,931
Other long-term liabilities		30,611			—			(7,813	)		32,139

Net cash used in operating activities		(549,503	)		(156,166	)		(1,406,237	)		(254,241	)

Cash flows from investing activities:
Purchase of property, plant and equipment		(36,363	)		—			(38,840	)		(29,276	)
Deposits on equipment		—			—			(50,000	)		—

Net cash used in investing activities		(36,363	)		—			(88,840	)		(29,276	)

Cash flows from financing activities:
Proceeds from issuance of notes payable		150,000			300,000			—			—
Principal payments on notes payable		(350,478	)		(3,405	)		(145,078	)		(209,564	)
Principal payments on capital lease liabilities		(262	)		(81,984	)		(2,383	)		—
Proceeds from sale of common stock, net of offering costs		—			—			104,839			—
Proceeds from sale of Series B Convertible Preferred Stock, net of offering costs		631,685			—			1,790,005			401,250

Net cash provided by financing activities		430,945			214,611			1,747,383			191,686

Net change in cash and cash equivalents		(154,921	)		58,445			252,306			(91,831	)

Cash and cash equivalents at beginning of period		158,849			100,404			3,928			158,849

Cash and cash equivalents at end of period	$	3,928		$	158,849		$	256,234		$	67,018

Supplemental disclosures:
Cash paid during period for interest	$	18,926		$	22,652		$	13,810		$	13,369
Cash paid during period for income taxes		—			—			—			—
Non-cash transactions:
Issuance of common stock for registration penalty		3,150			35,176			69,378			3,150
Issuance of common stock for services		140,000			—			—			140,000
Issuance of common stock in settlement of liabilities		—			—			1,489,665			—
Acquisition of property, plant and equipment through capital lease		16,870			—			—			—
Assets sold through assumption of liabilities by purchasers		—			833,399			—			—
Conversion of note payable to Series B Convertible Preferred Stock subscription		215,000			—			—			—
Issuance of Series B Convertible Preferred Stock in settlement of liabilities		—			—			518,770			—

The accompanying notes are an integral part of these consolidated financial statements.

F- 6

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies

This summary of significant accounting policies of Geospatial Corporation, a Nevada corporation, formerly known as Geospatial Holdings, Inc., (the “Company”), is presented to assist in the understanding of the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for the integrity and objectivity of the financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements.

Nature of Operations

The Company utilizes innovative technologies to acquire and manage data related to underground assets. The Company’s services include pipeline data acquisition and professional data management. The Company also provided utility locating services through March, 2011. The Company is located in Sarver, Pennsylvania, and provides services throughout the United States.

Consolidation

The Company’s financial statements include wholly-owned subsidiaries Geospatial Mapping Systems, Inc. and Utility Services and Consulting Corporation (“USCC”). USCC ceased operations in March, 2011. All material intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The accompanying consolidated balance sheet as of September 30, 2013, the consolidated statements of operations and statements of cash flows for the nine months ended September 30, 2013 and 2012 and the consolidated statement of changes in stockholders’ deficit for the nine months ended September 30, 2013 are unaudited. The interim unaudited financial statements have been prepared on the same basis as the annual audited financial statements; and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the Company’s financial position as of September 30, 2013, and the results of its operations and its cash flows for the nine months ended September 30, 2013 and 2012. The financial data and other information disclosed in these notes related to the nine months ended September 30, 2013 and 2012 are unaudited. The results for the nine months ended September 30, 2013 are not necessarily indicative of results to be expected for the year ending December 31, 2013, or any other interim periods, or any future year or period.

F- 7

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies (continued)

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates.

Estimates and assumptions which, in the opinion of management, are significant to the underlying amounts included in the financial statements and for which it would be reasonably possible that future events or information could change those estimates include:

	·	Estimated useful lives of property and equipment;
	·	Estimated costs to complete fixed-price contracts;
	·	Realization of deferred income tax assets;
	·	Estimated number and value of shares to be issued pursuant to registration payment arrangements.

These estimates are discussed further throughout these Notes to Financial Statements.

Going Concern

Since its inception, the Company has incurred net losses. In addition, the Company’s operations and capital requirements have been funded since its inception by sales of its common stock and advances from its chief executive officer. At September 30, 2013, the Company’s current liabilities exceeded its current assets by $5,635,189, and total liabilities exceeded total assets by $6,852,160. Those factors create an uncertainty about the Company’s ability to continue as a going concern. The Company’s management has implemented plans to secure financing sufficient for the Company’s operating and capital requirements, and to negotiate settlements or extensions of existing liabilities. There can be no assurance that such efforts will be successful. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Accounting Method

The Company’s financial statements are prepared on the accrual method of accounting.

Cash and Cash Equivalents

The Company considers all highly liquid debt investments with a maturity of three months or less when purchased to be cash equivalents.

F- 8

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies (continued)

Accounts Receivable

Accounts receivable are presented in the balance sheet net of estimated uncollectible amounts. The Company records an allowance for estimated uncollectible accounts in an amount approximating anticipated losses. Individual uncollectible accounts are written off against the allowance when collection of the individual accounts appears doubtful. The Company had no allowance for doubtful accounts at September 30, 2013, and December 31, 2012 and 2011.

Property and Equipment

Property and equipment are carried at cost. Depreciation of property and equipment is provided using the straight-line method for financial reporting purposes, and accelerated methods for tax purposes, based on estimated useful lives ranging from three to ten years. Depreciation expense was $15,427 for the nine months ended September 30, 2013, and $3,760 and $0 for the years ended December 31, 2012 and 2011, respectively.

Expenditures for major renewals and betterments that materially extend the useful lives of assets are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred.

The Company leases equipment under leases with terms of three years. Each lease is analyzed using the criteria in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 840, Leases , to determine whether the lease is a capital or operating lease. Capital leases are recorded at the inception of the lease as property and equipment, and a capital lease liability of the same amount, at the lesser of the fair value of the leased asset or the present value of the minimum lease payments. Assets recorded under capital lease agreements are depreciated over their estimated useful lives. Depreciation of assets recorded under capital leases is included with depreciation expense related to owned assets. At September 30, 2013, assets under capital leases and the related accumulated depreciation amounted to $16,870 and $2,952, respectively. At December 31, 2012, assets under capital leases and the related accumulated depreciation amounted to $16,870 and $422, respectively. The Company had no assets under capital lease at December 31, 2011.

F- 9

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies (continued)

Revenue Recognition

The Company records revenue when all of the following criteria are met:

Persuasive evidence of an arrangement exists;

Delivery has occurred or services have been rendered;

The price to the buyer is fixed or determinable; and

Collectibility is reasonably assured.

Substantially all of the Company’s services are rendered under the following types of contracts:

Fixed-price contracts are contracts in which the Company’s clients are billed at defined milestones for an agreed amount negotiated in advance for a specified scope of work. Revenues for fixed-price contracts are recognized under the percentage-of-completion method of accounting, whereby revenues are recognized ratably as those contracts are performed. This rate is based primarily on the proportion of contract costs incurred to date to total contract costs projected to be incurred for the entire project, or the proportion of measurable output completed to date to total output anticipated for the entire project.

Units of delivery contracts are contracts in which the Company’s clients are billed an agreed amount for each unit of service, as defined in the contract, that is delivered to the client. Revenues for units of delivery contracts are recognized as each unit of service is completed.

Time-and-materials contracts are contracts in which the Company and the client negotiate billing rates, typically hourly, and bill based on the actual time expended, plus other direct costs incurred in connection with the contract. Revenues for time-and-materials contracts are recognized as the services are rendered.

Advance customer payments are recorded as deferred revenue until such time as the related services are rendered or performed.

Revenues are recorded net of sales taxes collected.

Deferred Debt Issuance Costs

Debt issuance costs are capitalized and amortized over the term of the related debt.

F- 10

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies (continued)

Income Taxes

The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes, which requires the Company to provide a net deferred tax asset or liability equal to the expected future tax benefit or expense of temporary reporting differences between book and tax accounting methods and any available operating loss or tax credit carryovers.

The Company currently has a deferred tax asset resulting from differences in accounting methods for financial reporting and income tax reporting purposes. This deferred tax asset is completely offset by a valuation allowance due to the uncertainty of realization.

The Company is subject to taxation in various jurisdictions. The Company continues to remain subject to examination by U.S. federal authorities and various state authorities for the years 2009 through 2012. Due to financial constraints, the Company has not filed its federal and state tax returns for 2009 through 2013.

Stock-Based Payments

The Company accounts for its stock-based compensation in accordance with FASB ASC 718, Stock Compensation . The Company records compensation expense for employee stock options at the fair value of the stock options at the grant date, amortized over the vesting period. The Company records expense for stock options, warrants, and similar grants issued to non-employees at their fair value at the grant date, or the fair value of the consideration received, whichever is more readily available.

Registration Payment Arrangements

The Company is contractually obligated to issue shares of its common stock to certain investors for failure to register shares of its common stock under the Securities Act of 1933, as amended (the “Securities Act”). The Company has recorded a liability for the estimated number of shares to be issued at the fair value of the stock to be issued. This liability is included on the Consolidated Balance Sheet under the heading “accrued registration payment arrangement,” and amounted to $997,599 at September 30, 2013, and $1,066,977, and $1,070,127 at December 31, 2012 and 2011, respectively. Gains or losses resulting from changes in the carrying amount of the liability are included in the Consolidated Statement of Operations in other income and expense under the heading “registration payment arrangements”. There were no such gains or losses during the nine months ended September 30, 2013, or the years ended December 31, 2012 and 2011.

Segment Reporting

The Company operates as one segment. Accordingly, no segment reporting is presented.

F- 11

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 1 – Summary of Significant Accounting Policies (continued)

Discontinued Operations

In March, 2011, USCC ceased operations, and the Company sold substantially all of the assets of USCC. All results of operations for USCC are reported on the Statement of Operations as discontinued operations. No gain or loss on disposal of the assets of USCC was recorded because the assets were written down to their realizable value during 2010.

Recent Accounting Pronouncements

In July, 2012, FASB issued Accounting Standards Update No. 2012-02, Intangibles-Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment (“ASU 2012-02”). ASU 2012-02 amends Topic 350 by establishing an optional two-step analysis for impairment testing of indefinite-lived intangibles other than goodwill. This update allows an entity the option to first assess qualitative factors to determine whether it is necessary to perform the quantitative impairment test. Under that option, an entity no longer would be required to calculate the fair value of the intangible asset unless the entity determines, based on that qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. ASU 2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012 and early adoption is permitted. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements.

In July, 2013, the FASB issued Accounting Standards Update No. 2013-11, Liabilities (Topic 405): Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). ASU 2013-11 provides guidance on the financial statement presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. ASU 2013-11 is effective for annual and interim periods for fiscal years beginning after December 15, 2013. The Company is currently evaluating the potential impact of ASU 2013-11 on its consolidated financial statements.

F- 12

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 2 – Capital Stock

The Company has authorized 100,000,000 shares of common stock with a par value of $0.001 per share. Each outstanding share of common stock entitles the holder to one vote on all matters. Stockholders do not have preemptive rights to purchase shares in any future issuance of common stock. Upon the Company’s liquidation, common stockholders are entitled to a pro-rata share of assets, if any, after payment of creditors and preferred stockholders.

The Company has authorized 5,000,000 shares of preferred stock with a par value of $0.001 per share. All powers and rights of the shares of preferred stock are determined by the Company’s Board of Directors at issuance.

On December 11, 2009, the Company filed a Certificate of Designations, Powers, Preferences and Rights of the Series A Preferred Stock of Geospatial Holdings, Inc. (the “Certificate of Designations”) with the State of Nevada. The Certificate of Designations designated 1,575,000 shares of Series A Convertible Preferred Stock (“Series A Stock”) for issuance by the Company. Each share of Series A Stock was convertible to shares of common stock in accordance with the terms of the Certificate of Designations. Each holder of Series A Stock was entitled to the number of votes equal to the number of shares of common stock into which the Series A Stock may be converted. The holders of Series A Stock were entitled to a liquidation preference equal to the original issue price, and a dividend preference over the holders of common stock. All shares of Series A were automatically converted to common stock on June 7, 2010. On August 20, 2013, the Company filed a Certificate of Withdrawal of Certificate of Designation to withdraw the Series A Stock.

On August 20, 2013, the Company filed a Certificate of Designation to designate 5,000,000 shares of Series B Convertible Preferred Stock (“Series B Stock”) for issuance by the Company. Each share of Series B Stock is convertible to ten shares of common stock at the option of the holder, or automatically upon the occurrence of certain events. The holders of Series B Stock have the same voting rights and dividend participation rights as common stockholders in proportion to the number of shares of common stock the holders of Series B Stock would hold if those shares were converted to common stock. The holders of Series B stock are entitled to a liquidation preference of 150% of the original issue price, after payment of which they participate in liquidation with the holders of common stock.

The Company entered into a series of Subscription and Purchase Agreements with certain investors dated October 9, 2009 (the “October 2009 Subscription Agreement”) in connection with the sale of 2,000,000 shares of the Company’s common stock (the “October 2009 shares”). Pursuant to the October 2009 Subscription Agreement, the Company agreed to register the October 2009 shares under the Securities Act by March 1, 2010. The Company failed to register the October 2009 shares by March 1, 2010, and consequently each investor that invested pursuant to the October 2009 Subscription Agreement is entitled to receive an additional allocation of 2% of its portion of the October 2009 Shares for each 30-day period that elapses after March 1, 2010, subject to certain restrictions.

F- 13

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 2 – Capital Stock (continued)

The Company entered into a series of Subscription and Purchase Agreements with certain investors dated December 14, 2009 (the “December 2009 Subscription Agreement”) in connection with the sale of 1,500,000 shares of the Company’s Series A Stock (the “December 2009 shares”). The Series A Stock subsequently converted to 1.25 shares of the Company’s common stock. Pursuant to the December 2009 Subscription Agreement, the Company agreed to register the December 2009 shares under the Securities Act by March 1, 2010. The Company failed to register the December 2009 shares by March 1, 2010, and consequently each investor that invested pursuant to the December 2009 Subscription Agreement is entitled to receive an additional allocation of 2% of its portion of the December 2009 Shares for each 30-day period that elapses after March 1, 2010, subject to certain restrictions.

The Company entered into a series of Subscription and Purchase Agreements with certain investors dated March 19, 2010 (the “March 2010 Subscription Agreement”) in connection with the sale of 8,589,771 shares of the Company’s common stock (the “March 2010 shares”). Pursuant to the March 2010 Subscription Agreement, the Company agreed to register the March 2010 shares under the Securities Act by September 1, 2010. The Company failed to register the March 2010 shares by September 1, 2010, and consequently each investor that invested pursuant to the March 2010 Subscription Agreement is entitled to receive an additional allocation of 2% of its portion of the March 2010 Shares for each 30-day period that elapses after September 1, 2010, subject to certain restrictions.

The Company entered into a series of Subscription and Purchase Agreements with certain investors dated April 6, 2010 (the “April 2010 Subscription Agreement”) in connection with the sale of 112,000 shares of the Company’s common stock (the “April 2010 shares”). Pursuant to the April 2010 Subscription Agreement, the Company agreed to register the April 2010 shares under the Securities Act by September 1, 2010. The Company failed to register the April 2010 shares by September 1, 2010, and consequently each investor that invested pursuant to the March 2010 Subscription Agreement is entitled to receive an additional allocation of 2% of its portion of the March 2010 Shares for each 30-day period that elapses after September 1, 2010, subject to certain restrictions.

The Company entered into a series of Subscription and Purchase Agreements dated October 15, 2010 (the “October 2010 Subscription Agreement”) in connection with the issuance of $1,155,000 of 10% Senior Secured Redeemable Notes (the “Senior Notes”). Pursuant to the October 2010 Subscription Agreement, the Company agreed to register the common stock into which the Senior Notes are convertible (the “Conversion Shares”) by April 15, 2011. The Company failed to register the Conversion Stock by April 15, 2011, and consequently each investor that invested pursuant to the October 2010 Subscription Agreement is entitled to receive an additional allocation of 2% of its portion of the Conversion Shares for each 30-day period that elapses after April 15, 2011, subject to certain restrictions.

F- 14

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 2 – Capital Stock (continued)

The Company has recorded a liability for its obligation to issue shares for failure to register shares pursuant to the October 2009 Subscription Agreement, the December 2009 Subscription Agreement, the March 2010 Subscription Agreement, the April 2010 Subscription Agreement, and the October 2010 Subscription Agreement (collectively, the “Subscription Agreements”). There is no limitation to the maximum potential consideration to be paid for failure to register shares pursuant to the Subscription Agreements. The liability for accrued registration payment arrangements was $997,599, $1,066,977, and $1,070,127 at September 30, 2013, December 31, 2012, and December 31, 2011, respectively.

Note 3 – Accrued Expenses

Accrued expenses consisted of the following at September 30, 2013 and December 31, 2012 and 2011:

	September 30,		December 31,		December 31,
	2013		2012		2011

License fees	$	3,000,000	$	3,000,000	$	3,000,000
Payroll and taxes		602,187		1,419,295		1,564,160
Damage claims		12,645		46,804		61,711
Accounting		36,910		112,101		112,101
Insurance		63,758		24,131		28,071
Subcontractors		—		—		20,000
Other		41,686		234,265		402,654

Accrued expenses	$	3,757,186	$	4,836,596	$	5,188,697

F- 15

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 4 – Related-Party Transactions

The Company leases its headquarters building from Mark A. Smith, the Company’s Chairman and Chief Executive Officer. The building has approximately 3,200 square feet of office space, and is used by the Company’s corporate, technical, and operations staff. The Company incurred $58,500 of lease expense for this building in the nine months ended September 30, 2013, and $78,000 of lease expense in each of the years ended December 31, 2012 and 2011. The lease is cancellable by either party upon 30 days’ notice.

At December 31, 2010, the Company owed Mr. Smith $149,911 on a note payable (the “Smith Note”). Interest on the Smith Note at 8% amounted to $8,336 for the nine months ended September 30, 2013, and $13,514, and $12,443 for the years ended December 31, 2012 and 2011, respectively. The balance due on the Smith Note was $175,867 and $162,354 at December 31, 2012 and 2011, respectively.

At December 31, 2010, the Company owed Mr. Smith $33,073 on a convertible note payable (the “Convertible Note”). The Convertible Note was convertible to the Company’s common stock at a price of $1.00 per share. Interest on the Convertible Note at 8% amounted to $1,839 for the nine months ended September 30, 2013, and $2,981, and $2,745 for the years ended December 31, 2012 and 2011, respectively. The balance due on the note was $38,799 and $35,818 at December 31, 2012 and 2011, respectively.

At December 31, 2010, the Company owed Mr. Smith $140,803 on a demand note payable (the “Demand Note”). Interest on the Demand Note at 8% amounted to $7,830 for the nine months ended September 30, 2013, and $12,692, and $11,687 for the years ended December 31, 2012 and 2011, respectively. The balance due on the note was $165,182 and $152,489 at December 31, 2012 and 2011, respectively.

F- 16

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 4 – Related-Party Transactions (continued)

On November 9, 2012, the Company and Mr. Smith entered into a Lease Agreement, pursuant to which the Company leases a vehicle from Mr. Smith. The lease is for 60 months, and is for substantially the same terms for which Mr. Smith leases the vehicle from the manufacturer. Interest on the lease amounted to $338 for the nine months ended September 30, 2013, and $41 for the year ended December 31, 2012. The lease is recorded as a capital lease. At September 30, 2013, gross assets recorded under the lease and associated accumulated depreciation were $16,870 and $2,952, respectively. Future minimum payments under the capital lease are as follows as of September 30, 2013:

Balance of 2013	$	907
Year ending December 31, 2014		3,628
Year ending December 31, 2015		3,628
Year ending December 31, 2016		3,628
Year ending December 31, 2017		3,326
Thereafter		—
Total minimum payments		15,117
Less: minimum interest payments		(893	)
Minimum principal payments	$	14,224

On August 20, 2013, the Company and Mr. Smith entered into a Conversion Agreement (the “Smith Conversion Agreement”), pursuant to which liabilities totaling $1,253,644 were converted to 17,909,203 shares of the Company’s common stock and warrants to purchase 1,790,920 shares of the Company’s common stock at an exercise price of $0.25 per share. The liabilities to Mr. Smith included $573,635 of accrued salary, $282,156 of unreimbursed business expenses and unpaid rent for the Company’s offices, $184,204 for unpaid principal and accrued interest on the Smith Note, $40,638 for unpaid principal and accrued interest on the Convertible Note, and $173,011 for unpaid principal and accrued interest on the Demand Note. As required by the Smith Conversion Agreement, the Company paid taxes owed by Mr. Smith as a result of the conversion in the amount of $57,887. In addition to the liabilities to Mr. Smith converted pursuant to the Smith Conversion Agreement, the Company agreed to use reasonable commercial efforts to pay additional accrued salary of $97,500, and additional unreimbursed business expenses and unpaid rent of $21,366.

On August 20, 2013, the Company and Thomas R. Oxenreiter, the Company’s Chief Financial Officer, entered into a Conversion Agreement (the “Oxenreiter Conversion Agreement”), pursuant to which accrued salary of $223,959 and unreimbursed business expenses of $12,062 were converted to 3,371,719 shares of the Company’s common stock and warrants to purchase 337,172 shares of the Company’s common stock at an exercise price of $0.25 per share. As required by the Oxenreiter Conversion Agreement, the Company paid taxes owed by Mr. Oxenreiter as a result of the conversion in the amount of $18,925. In addition to the liabilities to Mr. Oxenreiter converted pursuant to the Conversion Agreement, the Company agreed to use reasonable commercial efforts to pay additional accrued salary of $31,250, and additional unreimbursed business expenses of $1,759.

F- 17

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 4 – Related-Party Transactions (continued)

In 2010, the Company entered into a Strategic Advisory Agreement (the “Strategic Advisory Agreement”) with Pace Global Energy Services, LLC (“Pace”) and Ridge Global, LLC (“Ridge”) to provide the Company with certain strategic advisory and other support services. Pursuant to the Strategic Advisory Agreement, the Company issued Pace and Ridge warrants to purchase 1,600,000 and 2,400,000 shares, respectively, of the Company’s common stock. The warrants expired on March 2, 2012. Further, pursuant to the Strategic Advisory Agreement, the Company agreed to expand the number of members of the Company’s board of directors from three to five, and to appoint Timothy F. Sutherland, chairman and chief executive officer of Pace, and Thomas J. Ridge, president and chief executive officer of Ridge, to fill the newly-created vacancies. The Company incurred fees pursuant to the Strategic Advisory Agreement of $480,000 during the year ended December 31, 2011. The fees pursuant to the Strategic Advisory Agreement amounted to $560,000 at December 31, 2012 and 2011.

On October 19, 2010, the Company, Pace, and Ridge entered into a Fee Deferral Agreement and Promissory Note (the “Promissory Note”), pursuant to which the company memorialized $238,030 of unpaid accounts payable to the Promissory Note bearing interest at 10% per annum. Interest on the Promissory Note totaled $4,864 for the nine months ended September 30, 2013, and $28,349 and $25,575 for the years ended December 31, 2012 and 2011, respectively. The balance due on the Promissory Note was $296,781 and $268,432 at December 31, 2012 and 2011, respectively.

Mr. Sutherland resigned his position on the Company’s Board of Directors on February 6, 2012, and Mr. Ridge resigned his position on the Company’s Board of Directors on May 31, 2012.

On February 28, 2013, the Company, Pace, and Ridge, Mr. Sutherland, and Mr. Ridge entered into a Mutual Termination and Release Agreement, which terminated all prior agreements and released all parties from all obligations related to all prior agreements, including the Promissory Note. As a result of the Mutual Termination and Release Agreement, the Company recorded a gain on extinguishment of debt of $861,645.

F- 18

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 5 – Senior Convertible Redeemable Notes

On October 15, 2010, the Company entered into a series of Senior Notes with certain investors. The initial principal amount of the Senior Notes totaled $1,155,000. Interest accrues on the Senior Notes at 10% per annum, payable quarterly by increasing the principal amounts of the Senior Notes. Upon certain instances of default, the interest rate may increase to 12% per annum. The principal and unpaid interest on the Senior Notes was due after 15 months, and was extendable for three additional six-month periods. The principal and unpaid interest on the Senior Notes is convertible at the option of the holders of the Senior Notes into the Company’s common stock at $0.50 per share.

On July 31, 2013, the Company entered into a Note Conversion Agreement with a holder of a Senior Note pursuant to which the Senior Note’s outstanding principal and interest of $132,342 were converted to 189,060 shares of the Company’s Series B Stock and warrants to purchase 18,906 shares of the Company’s Series B Stock.

The balance due on the Senior Notes amounted to $1,419,716 at September 30, 2013, and $1,414,331 and $1,233,624 at December 31, 2012 and 2011, respectively.

Note 6 – Notes Payable

Current notes payable consisted of the following at September 30, 2013 and December 31, 2012 and 2011:

	September 30, 2013		December 31, 2012		December 31, 2011
Note payable to an individual due February 1, 2013, bearing interest at 10% plus shares of Series B Stock	$	—	$	180,313	$	—
Promissory note due December 5, 2011, secured by equipment, bearing interest at 10% plus warrants to purchase common stock		—		—		301,583
Current portion of long-term notes payable	$	142,158		152,564		40,569
Current notes payable	$	142,158	$	332,877	$	342,152

F- 19

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 6 – Notes Payable (continued)

Long-term notes payable consisted of the following at September 30, 2013 and December 31, 2012 and 2011:

	September 30, 2013			December 31, 2012			December 31, 2011
Notes payable under settlement agreements with former employees, payable monthly with terms of up to 39 months, with interest rates ranging from 0% to 4%	$	371,476		$	462,526		$	40,569

Notes payable under settlement agreements with vendors, payable monthly with terms of up to 60 months, with interest rates ranging from 0% to 32%		79,176			73,776			—
Total long-term notes payable		450,652			536,302			40,569

Less: current portion		(142,158	)		(152,564	)		(40,569	)
Long-term notes payable, less current portion	$	308,494		$	383,738		$	—

Future maturities of long-term debt are as follows as of September 30, 2013:

Balance of 2013	$	38,497
Year ending December 31, 2014		136,280
Year ending December 31, 2015		236,134
Year ending December 31, 2016		14,000
Year ending December 31, 2017		14,000
Thereafter		11,741
	$	450,652

F- 20

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 7 – Commitments and Contingencies

Reduct License Agreement

The Company, Reduct N.V., a Belgian company (“Reduct”), and Delta Networks, S.A., a Luxembourg company (“Delta”), the owner of substantially all the stock of Reduct, were parties to an Amended and Restated Exclusive License and Distribution Agreement dated December 15, 2009 (the “License Agreement”), pursuant to which Reduct granted the Company an exclusive license to promote, market, use, and distribute certain Reduct products and technology. On December 16, 2010, Reduct issued the Company a notice of termination under the License Agreement, and terminated the License Agreement effective January 17, 2011. At the time of termination, the Company owed Reduct $3.0 million under the License Agreement, and Reduct claimed the Company was liable for accelerated payments of future license fees under the License Agreement.

On May 10, 2013, the parties to the License Agreement entered into a Mutual Release and Settlement Agreement (the “Reduct Settlement”), pursuant to which the parties agreed to terminate all obligations arising from the License Agreement and all prior agreements in consideration for (i) the Company issuing to Delta 9,000,000 shares of common stock; (ii) the Company issuing Delta warrants to purchase 3,000,000 shares of common stock exercisable at $0.50 per share through December 31, 2015; and (iii) the Company placing orders for Reduct equipment totaling $300,000 over nine months following the close of the Company’s Series B Stock financing. The Company must deliver additional shares of common stock to Delta in the event that the Company sells its stock for less than $0.07 per share. This anti-dilution provision expires if Delta’s shares become registered with the U.S. Securities and Exchange Commission and the Company raises at least $5.0 million in cash from the sale of its capital stock, including the Series B Stock financing.

In September 2013, the Company placed its first order for $100,000 of Reduct equipment, and paid Reduct a deposit of $50,000. At September 30, 2013, the Company had not delivered the shares of common stock or warrants to Delta.

Bank Deposits

The Company maintains its cash in bank deposit accounts at financial institutions. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. The bank accounts at times exceed FDIC limits. The Company has not experienced any losses on such accounts.

F- 21

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 7 – Commitments and Contingencies (continued)

Legal Matters

The Company is subject to various claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities. The Company believes that any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on the financial condition or the results of operations of the Company.

The Company and its officers have been sued in the Court of Common Pleas of Butler County, Pennsylvania by a group of investors alleging misrepresentation regarding the plaintiffs’ investments in the Company. The Company denies the allegations and believes that it will prevail should the case go to trial. The Company recorded expense in 2011 to the extent of its insurance deductible of $250,000 for the costs of its legal defense.

Note 8 – Income Taxes

The Company’s provision for (benefit from) income taxes is summarized below for the nine months ended September 30, 2013, and for the years ended December 31, 2012 and 2011:

	Nine Months Ended September 30, 2013			Year Ended December 31, 2012			Year Ended December 31, 2011

Current:
Federal	$	—		$	—		$	—
State		—			—			—
		—			—			—
Deferred:
Federal		(103,336	)		(455,570	)		(766,597	)
State		(32,815	)		(144,626	)		(243,364	)
		(136,181	)		(600,196	)		(1,009,961	)
Total income taxes		(136,181	)		(600,196	)		(1,009,961	)

Less: valuation allowance		136,181			600,196			1,009,961

Net income taxes	$	—		$	—		$	—

F- 22

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 8 – Income Taxes (continued)

The reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows for the nine months ended September 30, 2013 and for the years ended December 31, 2012 and 2011:

	Nine Months Ended September 30, 2013			Year Ended December 31, 2012			Year Ended December 31, 2011
Federal statutory rate		35.0	%		35.0	%		35.0	%
State income taxes (net of federal benefit)		6.5			6.5			6.5
Valuation allowance		(41.5	)		(41.5	)		(41.5	)

Effective rate		0.0	%		0.0	%		0.0	%

Significant components of the Company’s deferred tax assets and liabilities are summarized below as of September 30, 2013, and December 31, 2012 and 2011. A valuation allowance has been established as realization of such assets has not met the more-likely-than-not threshold requirement under FASB ASC 740.

	September 30, 2013			December 31, 2012			December 31, 2011
Start-up costs	$	59,616		$	66,991		$	76,825
License fees		337,232			356,597			403,417
Depreciation		(532	)		20,903			59,324
Accrued expenses		1,407,480			1,758,367			1,805,918
Uncompleted contracts		—			—			(11,896	)
Net operating loss carryforward		12,020,786			11,476,542			10,754,616

Deferred income taxes		13,824,582			13,688,401			13,088,204

Less: valuation allowance		(13,824,582	)		(13,688,401	)		(13,088,204	)

Net deferred income taxes	$	—		$	—		$	—

At September 30, 2013, the Company had federal and state net operating loss carryforwards of approximately $28,966,000. The federal and state net operating loss carryforwards will expire beginning in 2021 and 2026, respectively. The amount of the state net operating loss carryforward that can be utilized each year to offset taxable income is limited by state law.

F- 23

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 9 – Net Loss Per Share of Common Stock

Basic earnings per share are computed by dividing earnings available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share reflect per share amounts that would have resulted if dilutive potential common stock had been converted to common stock. The following reconciles amounts reported in the financial statements:

	Year Ended December 31, 2012			Year Ended December 31, 2011			Nine Months Ended September 30, 2013			Nine Months Ended September 30, 2012

Net loss	$	(1,391,502	)	$	(2,257,311	)	$	(333,438	)	$	(933,917	)

Divided by:
Weighted average shares outstanding		44,908,967			43,788,870			49,368,040			44,549,141

Basic and fully-diluted net loss per share	$	(0.03	)	$	(0.05	)	$	(0.01	)	$	(0.02	)

The effects of the potential conversion of the Smith Convertible Note to 38,798, and 35,817 shares of common stock were not included in the computation of diluted earnings per share for the year ended December 31, 2012 and 2011, respectively, because the effects of their conversion would be antidilutive. The effect of the potential conversion of the Smith Convertible Note to 38,027 shares of common stock was not included in the computation of diluted earnings per share for the nine months ended September 30, 2012 because the effect of its conversion would be antidilutive.

The effects of options to purchase 9,050,000 and 9,650,000 shares of common stock, and warrants to purchase 5,991,272 and 12,416,272 shares of common stock were not included in the computation of diluted earnings per share for the years ended December 31, 2012 and 2011, respectively, because the effects of their conversion would be antidilutive. The effect of options to purchase 9,050,000 shares of common stock were not included in the computation of diluted earnings per share for the nine months ended September 30, 2013 and 2012 because the effect of their conversion would be antidilutive. The effects of warrants to purchase 8,219,362 and 5,991,272 shares of common stock were not included in the computation of diluted earnings per share for the nine months ended September 30, 2013 and 2012, respectively, because the effect of their conversion would be antidilutive.

F- 24

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 10 – Stock-Based Payments

On September 23, 2013, the Company adopted the 2013 Equity Incentive Plan (the “2013 Plan”), pursuant to which up to 25,000,000 shares of the Company’s common stock shall be available for grants of awards, including incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, performance share awards, or performance compensation awards to eligible employees, consultants, and directors, provided that no more than 15,000,000 shares of common stock may be granted as incentive stock options. The Board of Directors has reserved 25,000,000 shares of the Company’s common stock for issuance under the 2013 Plan. The Company did not grant any awards pursuant to the 2013 Plan during the nine months ended September 30, 2013.

In 2007, the Company adopted the 2007 Stock Option Plan (the “2007 Plan”), pursuant to which the Compensation Committee of the Board of Directors (the “Committee”) may award grants of options to purchase up to 15,000,000 shares of the Company’s common stock to eligible employees, directors, and consultants, subject to exercise prices and vesting requirements determined by the Committee. On September 23, 2013, the Company reduced the number of shares of the Company’s common stock that may be subject to awards under the 2007 Plan to 9,050,000. The Board of Directors has reserved 9,050,000 shares of the Company’s common stock for issuance under the 2007 Plan. The Company granted options to purchase 220,000 shares of the Company’s common stock during the year ended December 31, 2011. The Company did not grant any options to purchase shares of the Company’s common stock pursuant to the 2007 Plan during the year ended December 31, 2012 and the nine months ended September 30, 2013.

Using the Black-Scholes option pricing model, management has determined that the stock options granted in 2011 had no value. Accordingly, no compensation cost or other expense was recorded for the stock options. The current value of a share of the Company’s common stock used in the Black-Scholes option pricing model was determined by an independent valuation. The value per share as determined by the valuation was $0.0089 per share as of December 31, 2011.

The assumptions used and the weighted average calculated value of the stock options are as follows at December 31, 2011:

Risk-free interest rate		1.41%
Expected dividend yield		None
Expected life of options		5 years
Expected volatility rate		50%
Weighted average fair value of options granted		$0.00

F- 25

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 10 – Stock-Based Payments (continued)

The following is an analysis of the options to purchase the Company’s common stock:

								Weighted
								Average
				Weighted				Remaining
				Average		Aggregate		Contractual
	Total			Exercise		Fair		Term
	Options			Price		Value		(In Years)

Total options outstanding at January 1, 2010		12,100,000		$	0.57
Granted		220,000			0.33
Exercised		—			—
Lapsed and forfeited		(2,670,000	)		0.69
Total options outstanding at December 31, 2011		9,650,000		$	0.51	$	—		6.1
Options vested and expected to vest at December 31, 2011		9,650,000		$	0.51	$	—		6.1
Options exercisable at December 31, 2011		9,650,000		$	0.51	$	—		6.1
Total options outstanding at January 1, 2012		9,650,000		$	0.51
Granted		—			—
Exercised		—			—
Lapsed and forfeited		(600,000	)		0.40
Total options outstanding at December 31, 2012		9,050,000		$	0.52	$	—		5.0
Options vested and expected to vest at December 31, 2012		9,050,000		$	0.52	$	—		5.0
Options exercisable at December 31, 2012		9,050,000		$	0.52	$	—		5.0

F- 26

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 10 – Stock-Based Payments (continued)

The following is an analysis of nonvested options:

				Weighted
	Nonvested			Average
	Options			Fair Value

Nonvested options at January 1, 2011		697,783		$	—
Granted		220,000			—
Vested		(354,448	)		—
Forfeited		(323,335	)		—

Nonvested options at December 31, 2011		240,000			—
Granted		—			—
Vested		(83,332	)		—
Forfeited		(156,668	)		—

Nonvested options at December 31, 2012		—		$	—

On December 5, 2011, the Company granted warrants to purchase 3,000,000 shares of the Company’s common stock at $0.10 per share to a lender. The warrants expire on December 5, 2016.

On December 1, 2012, the Company granted warrants to purchase 225,000 shares of the Company’s common stock at $0.15 per share to a contractor. The warrants expire on November 30, 2015.

On August 20, 2013, the Company granted warrants to purchase 1,790,920 and 337,172 shares of its common stock at $0.25 per share to its chief executive officer and its chief financial officer, respectively, in connection with debt conversion agreements. The warrants expire on August 20, 2018.

On September 30, 2013, the Company granted warrants to purchase 149,998 shares of the Company’s common stock at $0.25 per share to certain investors in connection with the sale of common stock. The warrants expire on September 30, 2018.

F- 27

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 10 – Stock-Based Payments (continued)

Using the Black-Scholes option pricing model, management has determined that the warrants to purchase the Company’s Common Stock granted to non-employees in 2012 and 2011 have no value. Accordingly, no expense was recorded upon the grants of the warrants to purchase the Company’s common stock. The current value of a share of the Company’s common stock used in the Black-Scholes option pricing model was determined by an independent appraisal.

The assumptions used and the weighted average calculated value of the stock purchase rights are as follows for the year ended December 31:

	2012	2011
Risk-free interest rate	1.41%	1.41%
Expected dividend yield	None	None
Expected life of warrants	3 years	5 years
Expected volatility rate	50%	50%
Weighted average fair value of warrants granted	$0.00	$0.00

F- 28

Note 10 – Stock-Based Payments (continued)

The following is an analysis of the warrants to purchase the Company’s common stock.

								Weighted
								Average
				Weighted				Remaining
				Average		Aggregate		Contractual
	Total			Exercise		Fair		Term
	Options			Price		Value		(In Years)

Total warrants outstanding at January 1, 2011		9,766,272		$	0.82
Granted		3,000,000			0.10
Exercised		—			—
Lapsed and forfeited		—			—
Total warrants outstanding at December 31, 2011		12,766,272		$	0.65	$	—		2.8
Warrants vested and expected to vest at December 31, 2011		12,766,272		$	0.65	$	—		2.8
Warrants exercisable at December 31, 2011		12,766,272		$	0.65	$	—		2.8
Total warrants outstanding at January 1, 2012		12,766,272		$	0.65
Granted		225,000			0.15
Exercised		—			—
Lapsed and forfeited		(7,000,000	)		0.79
Total warrants outstanding at December 31, 2012		5,991,272		$	0.47	$	—		4.4
Warrants vested and expected to vest at December 31, 2012		5,841,272		$	0.47	$	—		4.4
Warrants exercisable at December 31, 2012		5,841,272		$	0.47	$	—		4.4

F- 29

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 10 – Stock-Based Payments (continued)

The following is an analysis of nonvested warrants:

				Weighted
	Nonvested			Average
	Warrants			Fair Value

Nonvested warrants at January 1, 2011		—		$	—
Granted		3,000,000			—
Vested		(3,000,000	)		—
Forfeited		—			—

Nonvested warrants at December 31, 2011		—			—
Granted		225,000			—
Vested		(75,000	)		—
Forfeited		—			—

Nonvested warrants at December 31, 2012		150,000		$	—

On August 20, 2013, the Company granted warrants to purchase 451,738 shares of its Series B Stock at $2.50 per share to certain investors in connection with the sale of Series B Stock. The warrants expire on August 20, 2018.

During 2012, the Company issued 2,000,000 shares of the Company’s common stock as payment for services. The Company recorded expense of $140,000, the fair value of the services received.

Note 11 – Subsequent Events

On October 2, 2013, the Company filed a Certificate of Amendment with the State of Nevada to amend the Company’s Articles of Incorporation to change the Company’s name to Geospatial Corporation, to increase the aggregate number of authorized shares of common stock to 350,000,000 shares, and to increase the aggregate number of authorized shares of preferred stock to 25,000,000. The Company’s stockholders, acting by majority written consent in lieu of a meeting, voted to approve the amendments to the Company’s Articles of Incorporation on September 23, 2013.

On October 18, 2013, the Company granted stock appreciation rights on 15,900,000 shares of the Company’s common stock to eligible employees and consultants pursuant to the 2013 Plan, with an exercise price of $0.07 per share. The rights expire on October 18, 2023.

F- 30

Geospatial Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2013 (unaudited), and December 31, 2012 and 2011 (audited)

Note 11 – Subsequent Events (continued)

On October 22, 2013, the Company delivered to Delta 9,000,000 shares of common stock and warrants to purchase 3,000,000 shares of common stock at $0.50 per share through December 31, 2015 pursuant to the Reduct Settlement.

From November 27, 2013 through March 20, 2014, the Company sold 5,542,860 shares of its common stock at $0.35 per share for aggregate consideration of $1,940,116.

F- 31

PART II—INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13.

Other Expenses of Issuance and Distribution

The estimated expenses payable by the Company in connection with the offering of the securities being registered are as follows:

SEC Registration and Filing Fee	$	1,469.74
Legal Fees and Expenses*	$	30,000.00
Accounting Fees and Expenses*	$	5,000.00
Financial Printing*	$	5,000.00
Transfer Agent Fees*	$	500.00
Miscellaneous*	$	500.00
TOTAL*	$	42,469.74

* Estimated

Item 14.

Indemnification of Directors and Officers.

Item 15.

Recent Sales of Unregistered Securities.

On December 5, 2011, the Company issued warrants to purchase 3,000,000 shares of its common stock at an exercise price of $0.10 per share to one investor pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The warrants were issued in conjunction with a loan by the investor to the Company. The recipient of the warrants is an accredited investor, and we issued the warrants without any general solicitation or advertisement and with a restriction on resale.

On July 10, 2012, the Company issued 1,000,000 shares of the Company’s common stock to Troy G. Taggart, now the Company’s President,in exchange for services. The issuance was made pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. Mr. Taggart is an accredited investor, and the Company issued the shares of common stock without any general solicitation or advertisement and with a restriction on resale.

On July 10, 2012, the Company issued 1,000,000 shares of the Company’s common stock to a contractor in exchange for services. The issuance was made pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipient is an accredited investor, and the Company issued the shares of common stock without any general solicitation or advertisement and with a restriction on resale.

On December 1, 2012, the Company issued warrants to purchase 225,000 shares of its common stock at an exercise price of $0.15 per share to a contractor in exchange for services. The issuance was made pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipient is an accredited investor, and the Company issued the warrants without any general solicitation or advertisement and with a restriction on resale.

From July 13, 2013 through August 20, 2013, the Company sold to various investors 4,517,572 shares of its Series B Convertible Preferred Stock (“Series B Stock”)and warrants to purchase 451,738 shares of Series B Stock at an exercise price of price of $2.50 per share, for a purchase price of $0.70 per share of Series B Stock purchased, or an aggregate purchase price of $3,162,311. The sales of the Series B Stock and warrants took place in a series of private placement transactions pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act and/or Regulation D. The purchasers are accredited investors, and the Company conducted the private placement without any general solicitation or advertisement and with a restriction on resale.

II- 1

On August 20, 2013, the Company issued to Mark A. Smith, the Company’s Chief Executive Officer and Chairman of the Board of Directors, 17,909,203 shares of the Company’s common stock, and warrants to purchase 1,790,920 shares of the Company’s common stock at an exercise price of $0.25 per share, in conversion of $1,253,644 of outstanding indebtedness of the Company owed to Mr. Smith. The issuance was made pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act and/or Regulation D. Mr. Smith is an accredited investor, and the Company issued the common stock and warrants without any general solicitation or advertisement and with a restriction on resale.

On August 20, 2013, the Company issued to Thomas R. Oxenreiter, the Company’s Chief Financial Officer and Director, 3,371,719 shares of the Company’s common stock, and warrants to purchase 337,172 shares of the Company’s common stock at an exercise price of $0.25 per share, in conversion of $236,020 of outstanding indebtedness owed by the Company to Mr. Oxenreiter. The issuance was made pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act and/or Regulation D. Mr. Oxenreiter is an accredited investor, and the Company issued the common stock and warrants without any general solicitation or advertisement and with a restriction on resale.

On September 30, 2013, the Company sold 1,500,002 shares of its common stock, and issued warrants to purchase 149,998 shares of its common stock at an exercise price of $0.25 per share, to five investors at a sales price of $0.07 per share, for an aggregate sales price of $105,000. The sales took place in a series of private placement transactions pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act and/or Regulation D. The purchasers are accredited investors, and the Company conducted the private placements without any general solicitation or advertisement, and with a restriction on resale.

On October 22, 2013, pursuant to a Mutual Release and Settlement Agreement, the Company issued 9,000,000 shares of common stock to Delta Networks, S.A. to settle contractual obligations. In addition, the Company issued warrants to purchase 3,000,000 shares of its common stock at an exercise price of $0.50 per share. The shares and warrants were issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipient of the warrants is an accredited investor, and we issued the shares and warrants without any general solicitation or advertisement and with a restriction on resale.

From November 27, 2013 through March 20, 2014, the Company sold 5,542,860 shares of its common stock at $0.35 per share to several investors, for an aggregate sales price of $1,940,116. The sales and issuances took place in a series of private placement transactions pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) and/or Regulation D. The purchasers are accredited investors, and the Company conducted the private placements without any general solicitation or advertisement, and with a restriction on resale. No commission or other renumeration was paid or given directly or indirectly for soliciting the conversion.

From October 31, 2013 through December 31, 2013, the Company issued 7,132,140 shares of common stock to certain holders of its Series B Stock upon conversion of 713,214 shares of Series B Stock. Such shares were issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) and/or Section 3(a)(9) of the Securities Act and/or Regulation D. The converting holders of Series B stock are accredited investors, and the Company issued the shares without any general solicitation or advertisement, and with a restriction on resale.

During 2011, the Company issued 502,000 shares of common stock to settle contractual obligations. The shares were issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipients of the shares are accredited investors, and the Company issued the shares without any general solicitation or advertisement, and with a restriction on resale.

During 2012, the Company issued 45,000 shares of common stock to settle contractual obligations. The shares were issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipients of the shares are accredited investors, and the Company issued the shares without any general solicitation or advertisement, and with a restriction on resale.

II- 2

The recipients of the securities in each of these transaction described above represented their intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were placed upon the stock certificates issued in these transactions. All recipients had adequate access, through their relationships with us, to information about us.

During 2013, the Company issued 991,120 shares of common stock to settle contractual obligations. The shares were issued pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(2) of the Securities Act. The recipients are accredited investors, and the Company issued the shares without any general solicitation or advertisement, and with a restriction on resale.

II- 3

Item 16.

Exhibits and Financial Statement Schedules.

Exhibit		Document
3.1		Amended Articles of Incorporation of Geospatial Corporation

3.2		Bylaws of Geospatial Corporation

4.1		Certificate of Designations of the Series B Convertible Preferred Stock of Geospatial Holdings, Inc. dated as of August 20, 2013

4.2		Common Stock Specimen Certificate

4.3		Series B Convertible Preferred Stock Specimen Certificate

5.1		Opinion of Woodburn and Wedge, Attorneys and Counselors at Law, Reno, Nevada .*

10.1		Lease Agreement dated May 1, 2006 between Mark A. Smith and Geospatial Mapping Systems, Inc .

10.2		Geospatial Holdings, Inc. 2013 Equity Incentive Plan

10.3		Geospatial Mapping Systems, Inc. 2007 Stock Option Plan

10.4		Employment Agreement dated December 1, 2007 between Mark A. Smith and Geospatial Mapping Systems, Inc.

10.5		No nqualified Stock Option Agreement between Geospatial Mapping Systems, Inc. and Mark A. Smith dated effective December 1, 2007

10.6		Agreement Not to Compete between Mark A. Smith and Geospatial Mapping Systems, Inc. dated effective December 1, 2007

10.7		Conversion Agreement dated August 20, 2013 by and among Geospatial Holdings, Inc., Geospatial Mapping Systems, Inc. and Mark A. Smith

10.8		E mployment Agreement dated October 18, 2013 by and between Geospatial Corporation and Mark A. Smith

10.9		Stock Appreciation Rights Agreement dated October 18, 2013 between Geospatial Corporation and Mark A. Smith

10.10		Stock Appreciation Rights Agreement dated October 18, 2013 between Geospatial Corporation and Troy Taggart

10.11		Nonqualified Stock Option Agreement between Geospatial Mapping Systems, Inc. and Thomas R. Oxenreiter dated effective March 13, 2008

10.12		Agreement Not to Compete between Thomas R. Oxenreiter and Geospatial Mapping Systems, Inc. dated effective March 13, 2008

10.13		Conversion Agreement dated August 20, 2013 by and among Geospatial Holdings, Inc., Geospatial Mapping Systems, Inc. and Thomas R. Oxenreiter

10.14		Employment Agreement dated October 18, 2013 by and between Geospatial Corporation and Thomas R. Oxenreiter

10.15		Stock Appreciation Rights Agreement dated October 18, 2013 between Geospatial Corporation and Thomas R. Oxenreiter

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10.16		Mutual Termination and Release Agreement dated February 28, 2013 by and among Geospatial Holdings, Inc., Timothy F. Sutherland, Thomas J. Ridge, Pace Global Energy Services, LLC, Pace Financial Services, LLC and Ridge Global, LLC

10.17		Mutual Release and Settlement Agreement dated May 10, 2013 by and among Geospatial Holdings, Inc., Geospatial Mapping Systems, Inc., Reduct N.V., and Delta Networks, S.A.

10.18		Geospatial Holdings, Inc. Promissory Note dated November 21, 2012 in favor of Matthew F. Benson

10.19		Settlement Agreement dated May 25, 2012 among Joseph Timothy Nippes, Daniel A. Bradley, Christina Sherwood, Joseph A. Lane, Ronald Peterson, Timothy Story, Linda Ward, Geospatial Mapping Systems, Inc., Geospatial Holdings, Inc., Mark A. Smith, Thomas R. Oxenreiter, Timothy F. Sutherland and Thomas Ridge

21.1		List of Subsidiaries of the Registrant

23.1		Consent of Goff Backa Alfera and Company, LLC

23.3		Consent of Woodburn and Wedge, Attorneys and Counselors at Law, Reno, Nevada (contained in Exhibit 5.1*)

		*To be filed upon amendment.

II- 5

Item 17.

Undertakings.

The registrant undertakes:

(1) To file, during any period in which it offers or sells securities, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or most recent post-effective amendment thereto)which, individually or in the aggregate, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) To include material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(5) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Buffalo, Commonwealth of Pennsylvania on March 26, 2014.

	Geospatial Corporation

	By:	/s/ MARK A. SMITH
	Name:	Mark A. Smith
	Title:	Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons on the dates indicated:

Signature	Title	Date

/s/ MARK A. SMITH	President and Chief Executive Officer	March 26, 2014
Mark A. Smith	and Director (principal executive officer)

/s/ THOMAS R. OXENREITER	Chief Financial Officer and Director	March 26, 2014
Thomas R. Oxenreiter	(principal financial and accounting officer)

II-7

Geospatial Corporation S-1

Exhibit 3.1

ARTICLES OF INCORPORATION

GEOSPATIAL CORPORATION

(FORMERLY GEOSPATIAL HOLDINGS, INC.;

FORMERLY KAYENTA KREATIONS, INC.)

THE UNDERSIGNED natural persons of the age of twenty-one (21) years or more, acting as incorporators of a corporation under the Nevada Business Corporation Act, adopt the following Articles of Incorporation for such corporation.

ARTICLE I - NAME

The name of the Corporation is Geospatial Corporation.

ARTICLE II - DURATION

The duration of the corporation is perpetual.

ARTICLE III - PURPOSES

The purpose or purposes for which this corporation is organized are:

	(a)	To engage in the specific business of production and/or marketing of artwork and artistic creations, including coloring books, that depict Southwestern and Western heritage, culture and traditions of the United States, and to engage in any other lawful acts, activities and pursuits for which a corporation may be organized under Nevada law. Also, to acquire, develop, explore and otherwise deal in and with all kinds of real and personal property and all related activities, and for any and all other lawful purposes.

	(b)	To acquire by purchase, exchange, gift, bequest, subscription, or otherwise; and to hold, own, mortgage, pledge, hypothecate, sell, assign, transfer, exchange, or otherwise dispose of or deal in or with its own corporate securities or stock or other securities including, without limitations, any shares of stock, bonds, debentures, notes, mortgages, or other obligations, and any certificates, receipts or other instruments representing rights or interests therein on any property or assets created or issued by any person, firm, associate, or corporation, or instrumentalities thereof; to make payment therefor in any lawful manner or to issue in exchange therefor its unreserved earned surplus for the purchase of its own shares, and to exercise as owner or holder of any securities, any and all rights, powers, and privileges in respect thereof.

	(c)	To do each and everything necessary, suitable, or proper for the accomplishment of any of the purposes or the attainment of any one or more of the subjects herein enumerated, or which may, at any time, appear conducive to or expedient for the protection or benefit of this corporation, and to do said acts as fully and to the same extent as natural persons might, or could do in any part of the world as principals, agents, partners, trustees, or otherwise, either alone or in conjunction with any other person, association, or corporation.

	(d)	The foregoing clauses shall be construed both as purposes and powers and shall not be held to limit or restrict in any manner the general powers of the corporation, and the enjoyment and exercise thereof, as conferred by the laws of the State of Nevada; and it is the intention that the purposes and powers specified in each of the paragraphs of this Article III shall be regarded as independent purposes and powers.

ARTICLE IV - STOCK

The aggregate number of shares which this corporation shall have authority to issue is 350,000,000 shares of Common Stock having a par value of $.001 per share and 25,000,000 shares of Preferred Stock having a par value of $.001 per share. All Common Stock of the corporation shall be of the same class and shall have the same rights and preferences. The corporation shall have authority to issue the shares of Preferred Stock in one or more series with such rights, preferences and designations as determined by the Board of Directors of the Company. Fully-paid stock of this Company shall not be liable to any further call or assessment.

ARTICLE V - AMENDMENT

These Articles of incorporation may be amended by the affirmative vote of “a majority” of the shares entitled to vote on each such amendment.

ARTICLE VI - SHAREHOLDERS RIGHTS

The authorized but unissued stock of this corporation may be issued at such time, upon such terms and conditions and for such consideration as the Board of Directors shall determine. Shareholders shall not have pre-emptive rights to acquire unissued shares of the stock of this corporation.

ARTICLE VII - INITIAL OFFICE AND AGENT

The Corporation Trust Company of Nevada

One East First Street

Reno, Nevada 89501

ARTICLE VIII - DIRECTORS

The directors are hereby given the authority to do any act on behalf of the corporation by law and in each instance where the Business Corporation Act provides that the directors may act in certain instances where the Articles of Incorporation authorize such action by the directors, the directors are hereby given authority to act in such instances without specifically numerating such potential action or instance herein.

The directors are specifically given the authority to mortgage or pledge any or all assets of the business without stockholders’ approval .

The number of directors constituting the initial Board of Directors of this corporation is one. The name and address of person who is to serve as sole director until the first annual meeting of stockholders or until any successor(S) are elected and qualify, is:

NAME		ADDRESS
Michelle Barlow		1020 Belmont Avenue
		Salt Lake City, UT 84105

ARTICLE IX - INCORPORATORS

The name and address of each incorporator is:

NAME		ADDRESS
Van L. Butler		311 South State, Suite 440
		Salt Lake City, UT 84111

ARTICLE X

COMMON DIRECTORS - TRANSACTIONS BETWEEN CORPORATIONS

No contract or other transaction between this corporation and any one or more of its directors or officers or any other corporation, firm, association, or entity in which one or more of its directors or officers are financially interested, shall be either void or voidable because of such relationship or interest, or because such person is present at the meeting of the Board of Directors, or a committee thereof, which authorizes, approves, or ratifies such contract or transaction, or because his or their votes are counted for such purpose if: (a) the fact of such, relationship or interest is disclosed or known to the Board of Directors or committee which authorizes, approves, or ratifies the contract or transaction in good faith by vote or consent sufficient for the purpose without counting the votes or consents of such interested director; or (b) the fact of such relationship or interest is disclosed or known to the stockholders entitled to vote and they authorize, approve, or ratify such contract or transaction by vote or written consent, (c) the fact of the common directorship, office or financial interest is not disclosed or known to the director or officer at the time the transaction is brought before the board of directors of the corporation for action; or (d) the contract or transaction is fair and reasonable to the corporation at the time it is approved.

Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or committee thereof which authorizes, approves, or ratifies such contract or transaction.

ARTICLE XI

LIABILITY OF DIRECTORS AND OFFICERS

No director or officer shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty by such person as a director or officer. Notwithstanding the foregoing sentence, a director or officer shall be liable to the extent provided by applicable law, (i) for acts or omissions which involve intentional misconduct, fraud or a knowing violation of law, or (ii) for the payment of dividends in violation of NRS 78.300.

The provisions hereof shall not apply to or have any effect on the liability or alleged liability of any officer or director of the Corporation for or with respect to any acts or omissions of such person occurring prior to such amendment.

ARTICLE XII - FORWARD SPLIT

The Corporation has effectuated a 2.8 for 1 forward stock split as to the 1,316,392 shares of its common stock outstanding on April 25, 2008, thus increasing those shares to 3,685,618 shares effective with the opening of business on April 25, 2007. This forward split has no effect on the authorized shares of common stock of the Corporation.

Geospatial Corporation S-1

Exhibit 3.2

BY-LAWS

KAYENTA KREATIONS, INC.

ARTICLE I - OFFICES

The registered office of the corporation in the State of Nevada shall be located in the City of Reno, County of Washoe. The corporation may have its principal office and such other offices, either within or without the State of incorporation as the board of directors may designate or as the business of the corporation may from time to time require.

ARTICLE II - STOCKHOLDERS

1.	ANNUAL MEETING.

The annual meeting of the stockholders shall be held on such date as is determined by the Board of Directors for the purpose of electing directors and for the transaction of such other business as may come before the meeting.

2.	SPECIAL MEETINGS.

Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute, may be called by the president or by the directors, and shall be called by the president at the request of the holders of not less than ten per cent of all the outstanding shares of the corporation entitled to vote at the meeting.

3.	PLACE OF MEETING.

The directors may designate any place, either within or without the State unless otherwise prescribed by statute, as the place of meeting for any annual meeting or for any special meeting called by the directors. A waiver of notice signed by all stockholders entitled to vote at a meeting may designate any place, either within or without the state unless otherwise prescribed by statute, as the place for holding such meeting. If no designation is made, or if a special meeting be otherwise called, the place of meeting shall be the principal office of the corporation.

4.	NOTICE OF MEETING.

Written or printed notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than ten nor more than thirty days before the date of the meeting, either personally or by mail, by or at the direction of the president, or the secretary, or the officer or persons calling the meeting, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the stockholder at his address as it appears on the stock transfer books of the corporation, with postage thereon pre-paid.

5.	CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE.

For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or stockholders entitled to receive payment of any dividend, or in order to make a determination of stockholders for any other proper purpose, the directors of the corporation may provide that the stock transfer books shall be closed for a stated period but not to exceed, in any case, thirty days. If the stock transfer books shall be closed for the purpose of determining stockholders entitled to notice of or to vote at a meeting of stockholders, such books shall be closed for at least ten days immediately preceding such meeting. In lieu of closing the stock transfer books, the directors may fix in advance a date as the record date for any such determination of stockholders, such date in any case to be not more than thirty days and, in case of a meeting of stockholders, not less than ten days prior to the date on which the particular action requiring such determination of stockholders is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders, or stockholders entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of stockholders. When a determination of stockholders entitled to vote at any meeting of stockholders has been made as provided in this section, such determination shall apply to any adjournment thereof.

BY-LAWS

Page 2

6.	VOTING LISTS.

The officer or agent having charge of the stock transfer books for shares of the corporation shall make, at least ten days before each meeting of stockholders, a complete list of the stockholders entitled to vote at such meeting, or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each, which list, for a period of ten days prior to such meeting, shall be kept on file at the principal office of the corporation or transfer agent and shall be subject to inspection by any stockholder at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any stockholder during the whole time of the meeting. The original stock transfer book shall be prima facie evidence as to who are the stockholders entitled to examine such list or transfer books or to vote at the meeting of stockholders.

QUORUM.

Unless otherwise provided by law, at any meeting of stockholders one-third of the outstanding shares of the corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders. If less than said number of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

PROXIES.

At all meetings of stockholders, a stockholder may vote by proxy executed in writing by the stockholder or by his duly authorized attorney in fact. Such proxy shall be filed with the secretary of the corporation before or at the time of the meeting.

VOTING.

Each stockholder entitled to vote in accordance with the terms and provisions of the certificate of incorporation and these by- laws shall be entitled to one vote, in person or by proxy, for each share of stock entitled to vote held by such stockholders. Upon the demand of any stockholder, the vote for directors and upon any question before the meeting shall be by ballot. All elections for directors shall be decided by plurality vote; all other questions shall be decided by majority vote except as otherwise provided by the Certificate of Incorporation or the laws of this State.

BY-LAWS

Page 3

10.	ORDER OF BUSINESS.

The order of business at all meetings of the stockholders, shall be as follows:

	1.	Roll Call.

	2.	Proof of notice of meeting or waiver of notice.

	3.	Reading of minutes of preceding meeting.

	4.	Reports of Officers.

	5.	Reports of Committees.

	6.	Election of Directors.

	7.	Unfinished Business.

	8.	New Business.

11.	INFORMAL ACTION BY STOCKHOLDERS.

Unless otherwise provided by law, any action required to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders, may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by the same percentage of all of the shareholders entitled to vote with respect to the subject matter thereof as would be required to take such action at a meeting.

ARTICLE III - BOARD OF DIRECTORS

1.	GENERAL POWERS.

The business and affairs of the corporation shall be managed by its board of directors. The directors shall in all cases act as a board, and they may adopt such rules and regulations for the conduct of their meetings and the management of the corporation, as they may deem proper, not inconsistent with these by-laws and the laws of this State.

BY-LAWS

Page 4

2.	NUMBER, TENURE AND QUALIFICATIONS.

The number of directors of the corporation shall be as established by the board of directors, but shall be no less than one. Each director shall hold off ice until the next annual meeting of stockholders and until his successor shall have been elected and qualified.

3.	REGULAR MEETINGS.

A regular meeting of the directors, shall be held without other notice than this by-law immediately after, and at the same place as, the annual meeting of stockholders. The directors may provide, by resolution, the time and place for the holding of additional regular meetings without other notice than such resolution.

4.	SPECIAL MEETINGS .

Special meetings of the directors may be called by or at the request of the president or any director. The person or persons authorized to call special meetings of the directors may fix the place for holding any special meeting of the directors called by them. A director may attend any meeting by telephonic participation at the meeting.

NOTICE.

Notice of any special meeting shall be given at least two days previously thereto by written notice delivered personally, or by telegram or mailed to each director at his business address. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid. If notice be given by telegram, such notice shall be deemed to be delivered when the telegram is delivered to the telegraph company. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened.

6 .

QUORUM.

At any meeting of the directors a majority shall constitute a quorum for the transaction of business, but if less than said number is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice.

BY-LAWS

Page 5

7.	MANNER OF ACTING.

The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the directors.

8.	NEWLY CREATED DIRECTORSHIPS AND VACANCIES.

Newly created directorships resulting from an increase in the number of directors and vacancies occurring in the board for any reason except the removal of directors without cause may be filled by a vote of a majority of the directors then in office, although less than a quorum exists. Vacancies occurring by reason of the removal of directors without cause shall be filled by vote of the stockholders. A director elected to fill a vacancy caused by resignation, death or removal shall be elected to hold office for the unexpired term of his predecessor.

9.	REMOVAL OF DIRECTORS.

Any or all of the directors may be removed for cause by vote of the stockholders or by action of the board. Directors may be removed without cause only by vote of the stockholders.

10.	RESIGNATION.

A director may resign at any time by giving written notice to the board, the president or the secretary of the corporation. Unless otherwise specified in the notice, the resignation shall take effect upon receipt thereof by the board or such officer, and the acceptance of the resignation shall not be necessary to make it effective.

11.	COMPENSATION.

No compensation shall be paid to directors, as such, for their services, but by resolution of the board a fixed sum and expenses for actual attendance at each regular or special meeting of the board may be authorized. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor.

12.	PRESUMPTION OF ASSENT.

A director of the corporation who is present at a meeting of the directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.

BY-LAWS

Page 6

13.	EXECUTIVE AND OTHER COMMITTEES.

The board, by resolution, may designate from among its members an executive committee and other committees, each consisting of three or more directors. Each such committee shall serve at the pleasure of the board.

ARTICLE IV - OFFICERS

NUMBER.

The officers of the corporation shall be a president, a secretary and a treasurer, each of whom shall be elected by the directors. Such other officers and assistant officers as may be deemed necessary may be elected or appointed by the directors.

2.	ELECTION AND TERM OF OFFICE.

The officers of the corporation to be elected by the directors shall be elected annually at the first meeting of the directors held after each annual meeting of the stockholders. Each officer shall hold office until his successor shall have been duly elected and shall have qualified or until his death or until he shall resign or shall have been removed in the manner hereinafter provided.

3 .

REMOVAL.

Any officer or agent elected or appointed by the directors may be removed by the directors whenever in their judgment the best interests of the corporation would be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed.

4.	VACANCIES.

A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by the directors for the unexpired portion of the term.

BY-LAWS

Page 7

5.	PRESIDENT.

The president shall be the principal executive officer of the corporation and, subject to the control of the directors, shall in general supervise and control all of the business and affairs of the corporation. He shall, when present, preside at all meetings of the stockholders and of the directors. He may sign, with the secretary or any other proper officer of the corporation thereunto authorized by the directors, certificates for shares of the corporation, any deeds, mortgages, bonds, contracts, or other instruments which the directors have authorized to be executed, except in cases where the signing and execution thereof shall be expressly delegated by the directors or by these by-laws to some other officer or agent of the corporation, or shall be required by law to be otherwise signed or executed; and in general shall perform all duties incident to the office of president and such other duties as may be prescribed by the directors from time to time.

6.	VICE-PRESIDENT.

In the absence of the president or in event of his death, inability or refusal to act, a vice-president may perform the duties of the president, and when so acting, shall have all the powers of and be subject to all the restrictions upon the president. A vice-president shall perform such other duties as from time to time may be assigned to him by the President or by the directors.

7.	SECRETARY.

The secretary shall keep the minutes of the stockholders’ and of the directors’ meetings in one or more books provided for that purpose, see that all notices are duly given in accordance with the provisions of these by-laws or as required, be custodian of the corporate records and of the seal of the corporation and keep a register of the post office address of each stockholder which shall be furnished to the secretary by such stockholder, have general charge of the stock transfer books of the corporation and in general perform all duties incident to the office of secretary and such other duties as from time to time may be assigned to him by the president or by the directors.

BY-LAWS

Page 8

8.	TREASURER.

If required by the directors, the treasurer shall give a bond for the faithful discharge of his duties in such sum and with such surety or sureties as the directors shall determine. He shall have charge and custody of and be responsible for all funds and securities of the corporation; receive and give receipts for moneys due and payable to the corporation from any source whatsoever, and deposit all such moneys in the name of the corporation in such banks, trust companies or other depositories as shall be selected in accordance with these by-laws and in general perform all of the duties incident to the office of treasurer and such other duties as from time to time may be assigned to him by the president or by the directors.

SALARIES.

The salaries of the officers shall be fixed from time to time by the directors and no officer shall be prevented from receiving such salary by reason of the fact that he is also a director of the corporation.

ARTICLE V - CONTRACTS, LOANS, CHECKS AND DEPOSITS

1.	CONTRACTS.

The directors may authorize any officer or officers, agent or agents, to enter into any contract or execute and deliver any instrument in the name of and on behalf of the corporation, and such authority may be general or confined to specific instances.

LOANS.

No loans shall be contracted on behalf of the corporation and no evidences of indebtedness shall be issued in its name unless authorized by a resolution of the directors. Such authority may be general or confined to specific instances.

3.	CHECKS, DRAFTS, ETC.

All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the corporation, shall be signed by such officer or officers, agent or agents of the corporation and in such manner as shall from time to time be determined by resolution of the directors.

DEPOSITS.

All funds of the corporation not otherwise employed shall be deposited from time to time to the credit of the corporation in such banks, trust companies or other depositaries as the directors may select.

BY-LAWS

Page 9

ARTICLE VI - CERTIFICATES FOR SHARES AND THEIR TRANSFER

1.	CERTIFICATES FOR SHARES.

Certificates representing shares of the corporation shall be in such form as shall be determined by the directors. Such certificates shall be signed by the president and by the secretary or by such other officers authorized by law and by the directors. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the stockholders, the number of shares and date of issue, shall be entered on the stock transfer books of the corporation. All certificates surrendered to the corporation for transfer shall be canceled and no new certificate shall be issued until the former certificate for a like number of shares shall have been surrendered and canceled, except that in case of a lost, destroyed or mutilated certificate a new one may be issued therefor upon such terms and indemnity to the corporation as _ the directors may prescribe.

2.	TRANSFERS OF SHARES.

(a) Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, and cancel the old certificate; every such transfer shall be entered on the transfer book of the corporation which shall be kept at its principal office.

(b) The corporation shall be entitled to treat the holder of record of any share as the holder in fact thereof, and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person whether or not it shall have express or other notice thereof, except as expressly provided by the laws of this state.

ARTICLE VII - FISCAL YEAR

The fiscal year of the corporation shall end on the last day of such month in each year as the directors may prescribe.

ARTICLE VIII - DIVIDENDS

The directors may from time to time declare, and the corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law.

BY-LAWS

Page 10

ARTICLE IX - SEAL

The directors may, in their discretion, provide a corporate seal which shall have inscribed thereon the name of the corporation, the state of incorporation, and the words, “Corporate Seal”.

ARTICLE X - WAIVER OF NOTICE

Unless otherwise provided by law, whenever any notice is required to be given to any stockholder or director of the corporation under the provisions of these by-laws or under the provisions of the articles of incorporation, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

ARTICLE XI - AMENDMENTS

These by-laws may be altered, amended or repealed and new by-laws may be adopted by action of the Board of Directors.

December 26, 1995		/s/ Michelle Barlow
Date		Michelle Barlow, Secretary

BY-LAWS

Page 11

Geospatial Corporation S-1

EXHIBIT 4.1

Certificate of the Designations, Powers,
Preferences and Rights
of the
Series B Convertible Preferred Stock

of
Geospatial Holdings, Inc.

Pursuant to Section 78.1955 of the
Nevada Revised Statutes

Geospatial Holdings, Inc., a corporation organized and existing under the laws of the State of Nevada (the "Company"), by its President,

DOES HEREBY CERTIFY:

FIRST: That, pursuant to authority expressly vested in the Board of Directors of said Company by the provisions of its Articles of Incorporation, said Board of Directors duly adopted the following resolutions providing for the designation and issuance of 5,000,000 shares of Series B Convertible Preferred Stock, $0.001 par value.

RESOLVED, that this Board of Directors, pursuant to authority expressly vested in it by the provisions of the Articles of Incorporation of the Company, hereby authorizes the issue from time to time of a series of Preferred Stock of the Company and hereby fixes the designation, preferences, and the relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, in addition to those set forth in said Articles of Incorporation, to be in their entirety as follows:

The rights, preferences, privileges and restrictions granted to and imposed on the Series B Convertible Preferred Stock are as follows:

1. Definitions. For purposes of this Article, the following definitions shall apply:

(a) " Board " shall mean the Board of Directors of the Company.

(b) " Company " shall mean Geospatial Holdings, Inc., a Nevada corporation.

(d) " Common Stock Dividend " shall mean a stock dividend declared and paid on the Common Stock that is payable in shares of Common Stock.

(e) " National Securities Market " shall mean a national securities exchange, as defined in the Securities Exchange Act of 1934, as amended, or The Nasdaq Stock Market.

(f) " Original Issue Date " shall mean, with respect to any shares of Series Preferred Stock, the date on which such share of Series Preferred Stock was issued by the Company.

(g) " Original Issue Price " shall mean $0.70 per share for the Series B Preferred Stock.

(h) " Series B Preferred Stock " shall mean the Series B Convertible Preferred Stock, par value $0.001 per share, of the Company.

(i) " Subsidiary " shall mean any corporation of which at least fifty percent (50%) of the outstanding voting stock is at the time owned directly or indirectly by the Company or by one or more of such subsidiary corporations.

2. Dividend Rights .

(a) Participation Rights. If the Board shall declare dividends out of funds legally available therefor in any calendar year, then such dividends shall be declared pro rata on the Common Stock and the Series B Preferred Stock on a pari passu basis according to the number of shares of Common Stock held by such holders, where each holder of shares of Series B Preferred Stock is to be treated for this purpose as holding the greatest whole number of shares of Common Stock then issuable upon conversion of all shares of Series B Preferred Stock held by such holder pursuant to Section 6.

(b) Non-Cash Dividends. Whenever a dividend provided for in this Section 2 shall be payable in property other than cash, the value of such dividend shall be deemed to be the fair market value of such property as determined in good faith by the Board.

(c) Payment on Conversion. If the Company shall have declared but unpaid dividends with respect to the Series B Preferred Stock upon its conversion, the Company shall, subject to the legal availability of funds and assets therefor, pay in cash to the holder of the shares of Series B Preferred Stock being converted the full amount of any dividends declared but unpaid on such shares. To the extent that funds are not legally available for the payment of such dividends, such dividends will be paid in shares of fully paid and nonassessable shares of Common Stock.

3. Liquidation Rights. In the event of any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the funds and assets of the Company that may be legally distributed to the Company's stockholders (the "Available Funds and Assets") shall be distributed to stockholders in the following manner:

(a) Liquidation Preferences. The holders of each share of Series B Preferred Stock then outstanding shall be entitled to be paid, out of the Available Funds and Assets, and prior and in preference to any payment or distribution (or any setting apart of any payment or distribution) of any Available Funds and Assets on any shares of Common Stock, an amount per share equal to 1.5 times the Original Issue Price (as adjusted for stock splits, stock dividends, and the like) for the Series B Preferred Stock, plus all declared but unpaid dividends thereon .

(b) Participation Rights. If there are any Available Funds and Assets remaining after the payment or distribution (or the setting aside for payment or distribution) to the holders of the Series B Preferred Stock of their full preferential amounts described above in this Section 3, then all such remaining Available Funds and Assets shall be distributed among the holders of the then outstanding Common Stock and the Series B Preferred Stock pro rata according to the number of shares of Common Stock held by such holders (where, for this purpose, holders of shares of Series B Preferred Stock will be deemed to hold (in lieu of their Series B Preferred Stock) the greatest whole number of shares of Common Stock then issuable upon conversion in full of such shares of Series B Preferred Stock pursuant to Section 5) .

(c) Merger or Sale of Assets. A (i) consolidation or merger of the Company with or into any other corporation or corporations in which the holders of the Company's outstanding shares immediately before such consolidation or merger do not, immediately after such consolidation or merger, retain stock representing a majority of the voting power of the surviving corporation of such consolidation or merger or (ii) a sale of all or substantially all of the assets of the Company, shall each be deemed to be a liquidation, dissolution or winding up of the Company as those terms are used in this Section 3.

(d) Non-Cash Consideration. If any assets of the Company distributed to stockholders in connection with any liquidation, dissolution, or winding up of the Company are other than cash, then the value of such assets shall be their fair market value as determined by the Board, except that any securities to be distributed to stockholders in a liquidation, dissolution, or winding up of the Company shall be valued as follows:

(i) if the securities are then traded on a national securities exchange or the Nasdaq Stock Market (or a similar national quotation system), then the value shall be deemed to be the average of the closing prices of the securities on such exchange or system over the 30-day period ending three (3) days prior to the distribution; and

(ii) if actively traded over-the-counter, then the value shall be deemed to be the average of the closing bid prices over the 30-day period ending three (3) days prior to the closing of such merger, consolidation or sale; and

(iii) if there is no active public market, then the value shall be the fair market value thereof, as determined in good faith by the Board.

4. Voting Rights.

(a) Preferred Stock. Each holder of shares of Series B Preferred Stock shall be entitled to the number of votes equal to the number of whole shares of Common Stock into which such shares of Series B Preferred Stock could be converted pursuant to the provisions of Section 5 below at the record date for the determination of the stockholders entitled to vote on such matters or, if no such record date is established, the date such vote is taken or any written consent of stockholders is solicited.

(b) General. Each holder of Series B Preferred Stock shall have full voting rights and powers equal to the voting rights and powers of the holders of Common Stock, and shall be entitled to notice of any stockholders' meeting in accordance with the Bylaws of the Company (as in effect at the time in question) and applicable law, and shall be entitled to vote, together with the holders of Common Stock, with respect to any question upon which holders of Common Stock have the right to vote, except as may be otherwise provided by applicable law. Except as otherwise expressly provided herein or as required by law, the holders of Series B Preferred Stock and the holders of Common Stock shall vote together and not as separate classes.

5. Conversion Rights . The outstanding shares of Series B Preferred Stock shall be convertible into Common Stock as follows:

(a) Optional Conversion.

(1) At the option of the holder thereof, each share of Series B Preferred Stock shall be convertible, at any time or from time to time prior to the close of business on the business day before any date fixed for conversion of such share, into fully paid and nonassessable shares of Common Stock, as provided herein.

(2) Each holder of Series B Preferred Stock who elects to convert the same into shares of Common Stock shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or any transfer agent for the Series B Preferred Stock or Common Stock, and shall give written notice to the Company at such office that such holder elects to convert the same and shall state therein the number of shares of Series B Preferred Stock being converted. Thereupon the Company shall promptly issue and deliver at such office to such holder a certificate or certificates for the number of shares of Common Stock to which such holder is entitled upon such conversion. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the certificate or certificates representing the shares of Series B Preferred Stock to be converted, and the person entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock on such date.

(b ) Automatic Conversion .

(1) Each share of Series B Preferred Stock shall automatically be converted into fully paid and nonassessable shares of Common Stock, upon the earliest to occur of: (i) immediately prior to the closing of a firm commitment underwritten public offering pursuant to an effective registration statement filed under the Securities Act of 1933, as amended, in which shares of Common Stock are approved for listing on a National Securities Market, covering the offer and sale of Common Stock for the account of the Company in which the aggregate public offering price (before deduction of underwriters' discounts and commissions) equals or exceeds $30,000,000 and the public offering price per share of which equals or exceeds three (3) times the Original Issue Price of the Series B Preferred Stock per share, before deduction of underwriters' discounts and commissions (such price per share of Common Stock to be appropriately adjusted to reflect Common Stock Events (as defined in Section 5(e)) (any such offering being referred to as a (" Qualifying IPO "); and (ii) the Company's receipt of the written consent of the holders of not less than a majority of the then outstanding shares of Series B Preferred Stock to the conversion of all then outstanding Series B Preferred Stock under this Section 5 .

(2) Upon the occurrence of any event specified in Section 5(b)(1) above, the outstanding shares of Series B Preferred Stock shall be converted into Common Stock automatically without the need for any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided , however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series B Preferred Stock are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series B Preferred Stock, the holders of Series B Preferred Stock shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series B Preferred Stock or Common Stock. Thereupon, there shall be issued and delivered to such holder promptly at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series B Preferred Stock surrendered were convertible on the date on which such automatic conversion occurred.

(c) Conversion Price. Each share of Series B Preferred Stock shall be convertible in accordance with Section 5(a) or Section 5(b) above into the number of shares of Common Stock which results from dividing the Original Issue Price by the conversion price for Series B Preferred Stock that is in effect at the time of conversion (the " Conversion Price "). The initial Conversion Price for the Series B Preferred Stock shall be the Original Issue Price for the Series B Preferred Stock divided by ten. The Conversion Price of each series of Series B Preferred Stock shall be subject to adjustment from time to time as provided below.

(d) Adjustment Upon Common Stock Event. Upon the happening of a Common Stock Event (as hereinafter defined), the Conversion Price of the Series B Preferred Stock shall, simultaneously with the happening of such Common Stock Event, be adjusted by multiplying the Conversion Price of the Series B Preferred Stock in effect immediately prior to such Common Stock Event by a fraction, (i) the numerator of which shall be the number of shares of Common Stock issued and outstanding immediately prior to such Common Stock Event, and (ii) the denominator of which shall be the number of shares of Common Stock issued and outstanding immediately after such Common Stock Event, and the product so obtained shall thereafter be the Conversion Price for the Series B Preferred Stock. The Conversion Price for the Series B Preferred Stock shall be readjusted in the same manner upon the happening of each subsequent Common Stock Event. As used herein, the term " Common Stock Event " shall mean (i) the issue by the Company of additional shares of Common Stock as a dividend or other distribution on outstanding Common Stock, (ii) a subdivision of the outstanding shares of Common Stock into a greater number of shares of Common Stock, or (iii) a combination of the outstanding shares of Common Stock into a smaller number of shares of Common Stock.

(e) Adjustments for Other Dividends and Distributions. If at any time or from time to time after the Original Issue Date the Company pays a dividend or makes another distribution to the holders of the Common Stock payable in securities of the Company other than shares of Common Stock, then in each such event provision shall be made so that the holders of the Series B Preferred Stock shall receive upon conversion thereof, in addition to the number of shares of Common Stock receivable upon conversion thereof, the amount of securities of the Company which they would have received had their Series B Preferred Stock been converted into Common Stock on the date of such event (or such record date, as applicable) and had they thereafter, during the period from the date of such event (or such record date, as applicable) to and including the conversion date, retained such securities receivable by them as aforesaid during such period, subject to all other adjustments called for during such period under this Section 5 with respect to the rights of the holders of the Series B Preferred Stock or with respect to such other securities by their terms.

(f) Adjustment for Reclassification, Exchange and Substitution. If at any time or from time to time after the Original Issue Date, the Common Stock issuable upon the conversion of the Series B Preferred Stock is changed into the same or a different number of shares of any class or classes of stock, whether by recapitalization, reclassification or otherwise (other than by a Common Stock Event or a stock dividend, reorganization, merger, consolidation or sale of assets provided for elsewhere in this Section 5 ), then in any such event each holder of Series B Preferred Stock shall have the right thereafter to convert such stock into the kind and amount of stock and other securities and property receivable upon such recapitalization, reclassification or other change by holders of the number of shares of Common Stock into which such shares of Series B Preferred Stock could have been converted immediately prior to such recapitalization, reclassification or change, all subject to further adjustment as provided herein or with respect to such other securities or property by the terms thereof.

(g) Certificate of Adjustment. In each case of an adjustment or readjustment of the Conversion Price for the Series B Preferred Stock, the Company, at its expense, shall cause its Chief Financial Officer to compute such adjustment or readjustment in accordance with the provisions hereof and prepare a certificate showing such adjustment or readjustment, and shall mail such certificate, by first class mail, postage prepaid, to each registered holder of the Series B Preferred Stock at the holder's address as shown in the Company's books.

(h) Fractional Shares. No fractional shares of Common Stock shall be issued upon any conversion of Series B Preferred Stock. In lieu of any fractional share to which the holder would otherwise be entitled, the Company shall pay the holder cash equal to the product of such fraction multiplied by the Common Stock's fair market value as determined in good faith by the Board as of the date of conversion.

(i) Reservation of Stock Issuable Upon Conversion. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series B Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of the Series B Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series B Preferred Stock, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose.

(j) Notices . Any notice required by the provisions of this Section 5 to be given to the holders of shares of the Series B Preferred Stock shall be deemed given upon the earlier of actual receipt or deposit in the United States mail, by certified or registered mail, return receipt requested, postage prepaid, addressed to each holder of record at the address of such holder appearing on the books of the Company.

(k) No Impairment . The Company shall not avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but shall at all times in good faith assist in carrying out all such action as may be reasonably necessary or appropriate in order to protect the conversion rights of the holders of the Series B Preferred Stock against impairment.

6. Amendments. No provision of this Certificate of Designation may be amended, modified or waived without the written consent or affirmative vote of the holders of at least sixty six and two-thirds percent (66 2/3%) of the then outstanding shares of Series B Preferred Stock, voting as a separate class.

SECOND: That such determination of the designation, preferences and the relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, relating to the Series B Preferred Stock, was duly made by the Board of Directors pursuant to the provisions of the Articles of Incorporation of the Corporation, and in accordance with the provisions of Section 78.1955 of the Nevada Revised Statutes, as amended.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, Geospatial Holdings, Inc. has caused this Certificate of Designation to be executed this 24 ^th day of August, 2013.

	GEOSPATIAL HOLDINGS, INC.

	By:	/s/ Mark A. Smith
	Name:	Mark A. Smith
	Title:	CEO

Geospatial Corporation S-1

Exhibit 4.2

not valid unless countersigned by transfer agent. incorporated under the laws of the state of nevada. 1607 this certified that is record holder of common shares of geospatial holdings, inc. transferable on the books of the corporation in person or by duly authorized attorney upon surrender of this certificate properly endorsed. this certificate is not valid until countersigned by the transfer agent and registered by the registrar. witness the facsimile seal of the corporation and the facsimile signatures of its duly authorized officers. dated: secretary president inter west transfer co. inc. p.o. box 1713si salt lake city, utah 84117 countersigned & registered countersigned transfer agent-authorized

the following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations. ten com - as tenants in common tenent - as tenants by the entireties jt ten - as joint tenants with right of survivorship and not as tenants in common unif gift mln act – custodian (cust) (minor) under uniform gifts to minors act. (state) additional abbreviations may also be used though not in the above list. hereby sell, assign and transfer unto for value received,. please insert social security or other identifying number of assignee (please print or typewrite name and address, including zip code, of assignee) shares of the capital stock represented by the within certificate, and do hereby irrevocably constitute and appoint. attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises. dated notice: the signature to this assignment must correspond with the name as written upon the face of the certificate in every particular without alteration or enlargement or any change whatever notice signature guaranteed: signature(s) must be guaranteed by a firm which is a member of a registered national stock exchange, or by a bank (other than a savings bank). or a trust company. the guaranteeing firm must be a member of the medallion guarantee program transfer fee will apply for medallion guarantee use only

Geospatial Corporation S-1

Exhibit 4.3

not valid unless countersigned by transfer agent. incorporated under the laws of the state of nevada. pd1503 geospatial holdings authorized series “b” convertible preferred stock: 5,000,000 shares par value: $0,001 this certifies that is the record holder of series “b” convertible preferred shares of geospatial holdings, inc. transferable on the books of the corporation in person or by duly authorized attorney upon surrender of this certificate properly endorsed. this certificate is not valid until countersigned by the transfer agent and registered by the registrar. witness the facsimile seal of the corporation and the facsimile signatures of its duly authorized officers. dated: secretary president interwest transfer co. inc. p.o. box 171361 salt lake city, utah 84117 countersigned & registered countersigned transfer agent-authorized signature

the following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations. ten com - as tenants in common ten ent - as tenants by the entireties jt ten - as joint tenants with right of survivorship and not as tenants in common unif gift min act – custodian (cust) (minor) under uniform gifts to minors (state) additional abbreviations may also be used though not in the above list. hereby sell, assign and transfer unto for value received, please insert social security or other identifying number of assignee (please print or typewrite name and address, including zip code, of assignee) shares of the capital stock represented by the within certificate, and do hereby irrevocably constitute and appoint attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises. dated notice: the signature to this assignment must correspond with the name as written upon the face of the certificate in every particular without alteration or enlargement or any change whatever notice signature guaranteed: signature(s) must be guaranteed by a firm which is a member of a registered national stock exchange, or by a bank (other than a savings bank). or a trust company. the guaranteeing firm must be a member of the medallion guarantee program transfer fee will apply for medallion guarantee use only

Geospatial Corporation S-1

Exhibit 10.1

LEASE AGREEMENT

This lease agreement entered into on May 1 ^st , 2006 between Mark A. Smith residing at 1001 Carlisle Street, Natrona Heights, PA 15065 (hereinafter “Lessor”) and Geospatial Mapping Systems, Inc. a Delaware Corporation, having its principal place of business at 229 Howes Run Road, Sarver, PA 16055, (hereinafter “Lessee”).

DESCRIPTION OF PREMISES

Lessor leases to lessee a two story office located at 229 Howes Run Road, Sarver, PA Butler County, PA.

TERM

The term of this lease agreement is 3 years, beginning on May 1 ^st , 2006 and terminating on April 30 ^th , 2009. Lessor may terminate this lease at anytime by providing 90 days notice to Lessee.

RENT

The total rent under this agreement is $234,000. Lessee shall pay Lessor the above specified amount in installments of $6,500 each month, beginning on May 1 ^st , 2006, with succeeding payments due on the 1 ^st of each month during the term of this agreement.

USE OF PREMISES

The premises are to be used for the purposes of day to day business activities of Lessee. Lessee shall restrict it use to such purposes and shall not use or permit the use of the premises for any other purpose without the prior, express and written consent of Lessor or Lessor’s authorized agent.

WASTE, NUISANCE OR UNLAWFUL ACTIVITY

Lessee shall not allow any waste or nuisance on the demised premises or use or allow the premises to be used for any unlawful purpose.

UTILITIES/TAXES

Lessee shall arrange and pay for all utilities and real estate taxes for the term of the lease agreement.

REPAIRS AND MAINTENANCE

Lessee shall maintain the premises and keep them in good repair at its expense.

ENTRY AND USE OF THE PREMISES BY LESSOR

a)	Lessor shall retain the right to use the premises in ways that do not directly interfere with the operations of Lessee.

b)	Lessor reserves the right to enter the premises at any time and lessee shall permit Lessor to do so.

NON-LIABILITY OF LESSOR FOR DAMAGES OR CLAIMS

Lessor shall be liable for liability or damage claims for injury to persons or property from any and all causes relating to the use of the premises including those arising out of damages or losses occurring on the areas adjacent to the premises during the term of this lease agreement. Lessee shall indemnify Lessor from any and all liability, loss or other damage claims or obligations resulting from any injuries or losses of any nature.

LIABILITY INSURANCE

Lessee shall procure and maintain in force at its expense during the term of this lease agreement and any extension of such term, public liability insurance with insurers approved by Lessor. Such coverage shall be adequate to protect against liability for damage claims through public use of or arising out of accidents occurring in or around the premises, in a minimum amount of $1,000,000 for each person injured, $2,000,000 for any one accident and $1,000,000 property damage. The insurance policies shall provide coverage for contingent liability of Lessor on any claims or losses. Copies of the insurance policies shall be delivered to the Lessor. Lessee shall obtain a written obligation from the insurers to notify Lessor in writing at least 30 days prior to cancellation or refusal to renew any policy.

ASSIGNMENT/SUBLEASE

Lessee shall not assign or sublease the premises or any right or privilege connected with the premises, or allow any other person except agents or employees of Lessee to occupy the premises or any part of the premises.

WAIVERS

Waiver by Lessor of any breach of any covenant or duty of Lessee under this lease is not a waiver of a breach of any other covenant or duty of lessee, or of any subsequent breach of the same covenant or duty.

GOVERNING LAW

It is agreed that this lease agreement shall be governed by, construed and enforced in accordance with the laws of the State of Pennsylvania.

ENTIRE AGREEMENT

This lease agreement shall constitute the entire agreement between the parties. Any prior understanding or representation of any kind preceding the date of this lease agreement shall not be binding upon either party except to the extent incorporated in this lease agreement.

MODIFICATION OF AGREEMENT

Any modifications of this lease agreement or additional obligation assumed by either party in connection with this agreement shall be binding only if evidenced in a writing signed by each party or an authorized representative of each party.

NOTICES

All notices, demands or other writings that this lease agreement requires to be given, or which may be given, by either party to the other, shall be deemed to have been fully given when made in writing and deposited in the United States mail, registered and postage prepaid, and addressed as follows:


To Lessor:	Mark A. Smith
	1001 Carlisle Street Natrona Heights, PA 15065

To Lessee:	Geospatial Mapping Systems, Inc. 229 Howes Run Road Sarver, PA 16055

BINDING EFFECT

This lease agreement shall bind and inure to the benefit of the respective heirs, personal representatives, successors and assigns of the parties.

TIME IS OF THE ESSENCE

It is specifically declared and agreed that time is of the essence of this lease agreement.

In witness, each party to this lease has caused it to be executed on the date indicated below.



Mark A. Smith Lessor				Mark A. Smith, President Geospatial Mapping Systems, Inc.

May 1, 2006				May 1, 2006
Date				Date

Geospatial Corporation S-1

EXHIBIT 10.2

GEOSPATIAL HOLDINGS, INC. 2013 EQUITY INCENTIVE PLAN

1. Purpose; Eligibility .

1.1 General Purpose . The name of this plan is the Geospatial Holdings, Inc. 2013 Equity Incentive Plan (the " Plan "). The purposes of the Plan are to (a) enable Geospatial Holdings, Inc. 2013, a Nevada corporation (the " Company "), and any Affiliate to attract and retain the types of Employees, Consultants and Directors who will contribute to the Company's long range success; (b) provide incentives that align the interests of Employees, Consultants and Directors with those of the shareholders of the Company; and (c) promote the success of the Company's business.

1.2 Eligible Award Recipients . The persons eligible to receive Awards are the Employees, Consultants and Directors of the Company and its Affiliates and such other individuals designated by the Committee who are reasonably expected to become Employees, Consultants and Directors after the receipt of Awards.

1.3 Available Awards . Awards that may be granted under the Plan include: (a) Incentive Stock Options, (b) Non-qualified Stock Options, (c) Stock Appreciation Rights, (d) Restricted Awards, (e) Performance Share Awards, and (f) Performance Compensation Awards.

2. Definitions .

" Affiliate " means a corporation or other entity that, directly or through one or more intermediaries, controls, is controlled by or is under common control with, the Company.

" Applicable Laws " means the requirements related to or implicated by the administration of the Plan under applicable state corporate law, United States federal and state securities laws, the Code, any stock exchange or quotation system on which the shares of Common Stock are listed or quoted, and the applicable laws of any foreign country or jurisdiction where Awards are granted under the Plan.

" Award " means any right granted under the Plan, including an Incentive Stock Option, a Non-qualified Stock Option, a Stock Appreciation Right, a Restricted Award, a Performance Share Award or a Performance Compensation Award.

" Award Agreement " means a written agreement, contract, certificate or other instrument or document evidencing the terms and conditions of an individual Award granted under the Plan which may, in the discretion of the Company, be transmitted electronically to any Participant. Each Award Agreement shall be subject to the terms and conditions of the Plan.

" Beneficial Owner " has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial ownership of all securities that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time. The terms "Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.

" Board " means the Board of Directors of the Company, as constituted at any time.

" Cause " means:

With respect to any Employee or Consultant: (a) If the Employee or Consultant is a party to an employment or service agreement with the Company or its Affiliates and such agreement provides for a definition of Cause, the definition contained therein; or (b) If no such agreement exists, or if such agreement does not define Cause: (i) the commission of, or plea of guilty or no contest to, a felony or a crime involving moral turpitude or the commission of any other act involving willful malfeasance or material fiduciary breach with respect to the Company or an Affiliate; (ii) conduct that results in or is reasonably likely to result in harm to the reputation or business of the Company or any of its Affiliates; (iii) gross negligence or willful misconduct with respect to the Company or an Affiliate; or (iv) material violation of state or federal securities laws.

With respect to any Director, a determination by a majority of the disinterested Board members that the Director has engaged in any of the following: (a) malfeasance in office; (b) gross misconduct or neglect; (c) false or fraudulent misrepresentation inducing the director's appointment; (d) wilful conversion of corporate funds; or (e) repeated failure to participate in Board meetings on a regular basis despite having received proper notice of the meetings in advance.

The Committee, in its absolute discretion, shall determine the effect of all matters and questions relating to whether a Participant has been discharged for Cause.

" Change in Control " means the occurrence of any of the following events:

(i) Any "person" (as defined in Section 13(d) and 14(d) of the Exchange Act), excluding for this purpose, (a) the Participant, (b) the Company or any subsidiary of the Company, or (c) any employee benefit plan of the Company or of any subsidiary of the Company, or any person or entity organized, appointed, or established by the Company for or pursuant to the terms of any such plan that acquires beneficial ownership of voting securities of the Company, becomes (or has become during the twelve (12) month period ending on the date of the most recent acquisition by such person) the Beneficial Owner, directly or indirectly of securities of the Company representing more than thirty-five percent (35%) of the combined voting power of the Company's then outstanding securities; provided , however , that no Change in Control will be deemed to have occurred as a result of a change in ownership percentage resulting solely from an acquisition of securities by the Company;

(ii) The incumbent Directors cease for any reason to constitute at least a majority of the Board during any twelve (12) month period; or

(iii) Consummation of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of the assets of the Company (a " Business Combination "), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the Beneficial Owners of outstanding voting securities of the Company immediately prior to such Business Combination Beneficially Own, directly or indirectly, fifty percent (50%) or more of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all of substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company.

" Code " means the Internal Revenue Code of 1986, as it may be amended from time to time. Any reference to a section of the Code shall be deemed to include a reference to any regulations promulgated thereunder.

" Committee " means a committee of one or more members of the Board appointed by the Board to administer the Plan in accordance with Section 3.3 and Section 3.4 .

" Common Stock " means the common stock, $.0001 par value per share, of the Company, or such other securities of the Company as may be designated by the Committee from time to time in substitution thereof.

" Company " means Geospatial Holdings, Inc., a Nevada corporation, and any successor thereto.

" Consultant " means any individual who is engaged by the Company or any Affiliate to render consulting or advisory services.

" Continuous Service " means that the Participant's service with the Company or an Affiliate, whether as an Employee, Consultant or Director, is not interrupted or terminated. The Participant's Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Consultant or Director or a change in the entity for which the Participant renders such service, provided that there is no interruption or termination of the Participant's Continuous Service; provided further that if any Award is subject to Section 409A of the Code, this sentence shall only be given effect to the extent consistent with Section 409A of the Code. For example, a change in status from an Employee of the Company to a Director of an Affiliate will not constitute an interruption of Continuous Service. The Committee or its delegate, in its sole discretion, may determine whether Continuous Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal or family leave of absence.

" Covered Employee " has the same meaning as set forth in Section 162(m)(3) of the Code, as interpreted by Internal Revenue Service Notice 2007-49.

" Director " means a member of the Board.

" Disability " means that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment; provided, however, for purposes of determining the term of an Incentive Stock Option pursuant to Section 6.10 hereof, the term Disability shall have the meaning ascribed to it under Section 22(e)(3) of the Code. The determination of whether an individual has a Disability shall be determined under procedures established by the Committee. Except in situations where the Committee is determining Disability for purposes of the term of an Incentive Stock Option pursuant to Section 6.10 hereof within the meaning of Section 22(e)(3) of the Code, the Committee may rely on any determination that a Participant is disabled for purposes of benefits under any long-term disability plan maintained by the Company or any Affiliate in which a Participant participates. Notwithstanding the foregoing, a Participant bound by an employment, consulting, or other agreement between the Company or an Affiliate and the Participant, shall not be determined to be Disabled under this Plan any earlier than he or she would be determined to be disabled under such agreement.

" Disqualifying Disposition " has the meaning set forth in Section 14.12.

" Effective Date " shall mean the date as of which this Plan is adopted by the Board.

" Employee " means any person, including an Officer or Director, employed by the Company or an Affiliate; provided, that, for purposes of determining eligibility to receive Incentive Stock Options, an Employee shall mean an employee of the Company or a parent or subsidiary corporation within the meaning of IRC Section 424. Mere service as a Director or payment of a director's fee by the Company or an Affiliate shall not be sufficient to constitute "employment" by the Company or an Affiliate.

" Exchange Act " means the Securities Exchange Act of 1934, as amended.

" Fair Market Value " means, as of any date, the value of the Common Stock as determined below. If the Common Stock is listed on any established stock exchange or a national market system, the Fair Market Value shall be the average of the high and low sales prices of a share of Common Stock (or if no sales were reported the average of the high and low sales prices on the date immediately preceding such date) as quoted on such exchange or system on the day of determination, as reported in the Wall Street Journal or such other source as the Committee deems reliable. If the Common Stock is not listed on any established stock exchange or a national market system, but sales of Common Stock are reported in the over-the-counter market, than Fair Market Value shall be the last reported bid price in the over-the counter market. In the absence of the foregoing, the Fair Market Value shall be determined in good faith by the Committee and such determination shall be conclusive and binding on all persons.

" Free Standing Rights " has the meaning set forth in Section 7.1(a) .

" Good Reason " means: (a) If an Employee or Consultant is a party to an employment or service agreement with the Company or its Affiliates and such agreement provides for a definition of Good Reason, the definition contained therein; or (b) If no such agreement exists or if such agreement does not define Good Reason, the occurrence of one or more of the following without the Participant's express written consent, which circumstances are not remedied by the Company within thirty (30) days of its receipt of a written notice from the Participant describing the applicable circumstances (which notice must be provided by the Participant within ninety (90) days of the Participant's knowledge of the applicable circumstances): (i) any material, adverse change in the Participant's duties, responsibilities, authority, title, status or reporting structure; (ii) a material reduction in the Participant's base salary or bonus opportunity; or (iii) a geographical relocation of the Participant's principal office location by more than fifty (50) miles.

" Grant Date " means the date on which the Committee adopts a resolution, or takes other appropriate action, expressly granting an Award to a Participant that specifies the key terms and conditions of the Award or, if a later date is set forth in such resolution, then such date as is set forth in such resolution.

" Incentive Stock Option " means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.

" Incumbent Directors " means individuals who, on the Effective Date, constitute the Board, provided that any individual becoming a Director subsequent to the Effective Date whose election or nomination for election to the Board was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for Director without objection to such nomination) shall be an Incumbent Director. No individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to Directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any person other than the Board shall be an Incumbent Director.

" Negative Discretion " means the discretion authorized by the Plan to be applied by the Committee to eliminate or reduce the size of a Performance Compensation Award in accordance with Section 7.4(d)(iv) of this Plan; provided , that , the exercise of such discretion would not cause the Performance Compensation Award to fail to qualify as "performance-based compensation" under Section 162(m) of the Code.

" Non-Employee Director " means a Director who is a "non-employee director" within the meaning of Rule 16b-3.

" Non-qualified Stock Option " means an Option that by its terms does not qualify or is not intended to qualify as an Incentive Stock Option.

" Officer " means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

" Option " means an Incentive Stock Option or a Non-qualified Stock Option granted pursuant to the Plan.

" Optionholder " means a person to whom an Option is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Option.

" Option Exercise Price " means the price at which a share of Common Stock may be purchased upon the exercise of an Option.

" Outside Director " means a Director who is an "outside director" within the meaning of Section 162(m) of the Code and Treasury Regulations Section 1.162-27(e)(3) or any successor to such statute and regulation.

" Participant " means an eligible person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Award.

" Performance Compensation Award " means any Award designated by the Committee as a Performance Compensation Award pursuant to Section 7.4 of the Plan.

" Performance Criteria " means the criterion or criteria that the Committee shall select for purposes of establishing the Performance Goal(s) for a Performance Period with respect to any Performance Compensation Award under the Plan. The Performance Criteria that will be used to establish the Performance Goal(s) shall be based on the attainment of specific levels of performance of the Company (or Affiliate, division, business unit or operational unit of the Company) and shall be limited to the following: (a) net earnings or net income (before or after taxes); (b) basic or diluted earnings per share (before or after taxes); (c) net revenue or net revenue growth; (d) gross revenue; (e) gross profit or gross profit growth; (f) net operating profit (before or after taxes); (g) return on assets, capital, invested capital, equity, or sales; (h) cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital); (i) earnings before or after taxes, interest, depreciation and/or amortization; (j) gross or operating margins; (k) improvements in capital structure; (l) budget and expense management; (m) productivity ratios; (n) economic value added or other value added measurements; (o) share price (including, but not limited to, growth measures and total shareholder return); (p) expense targets; (q) margins; (r) operating efficiency; (s) working capital targets; (t) enterprise value; (u) safety record; and (v) completion of acquisitions or business expansion.

Any one or more of the Performance Criteria may be used on an absolute or relative basis to measure the performance of the Company and/or an Affiliate as a whole or any division, business unit or operational unit of the Company and/or an Affiliate or any combination thereof, as the Committee may deem appropriate, or as compared to the performance of a group of comparable companies, or published or special index that the Committee, in its sole discretion, deems appropriate, or the Committee may select Performance Criterion (o) above as compared to various stock market indices. The Committee also has the authority to provide for accelerated vesting of any Award based on the achievement of Performance Goals pursuant to the Performance Criteria specified in this paragraph. To the extent required under Section 162(m) of the Code, the Committee shall, within the first 90 days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code), define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance Period. In the event that applicable tax and/or securities laws change to permit the Committee discretion to alter the governing Performance Criteria without obtaining shareholder approval of such changes, the Committee shall have sole discretion to make such changes without obtaining shareholder approval.

" Performance Formula " means, for a Performance Period, the one or more objective formulas applied against the relevant Performance Goal to determine, with regard to the Performance Compensation Award of a particular Participant, whether all, some portion but less than all, or none of the Performance Compensation Award has been earned for the Performance Period.

" Performance Goals " means, for a Performance Period, the one or more goals established by the Committee for the Performance Period based upon the Performance Criteria. The Committee is authorized at any time during the first ninety (90) days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code), or at any time thereafter (but only to the extent the exercise of such authority after such period would not cause the Performance Compensation Awards granted to any Participant for the Performance Period to fail to qualify as "performance-based compensation" under Section 162(m) of the Code), in its sole and absolute discretion, to adjust or modify the calculation of a Performance Goal for such Performance Period to the extent permitted under Section 162(m) of the Code in order to prevent the dilution or enlargement of the rights of Participants based on the following events: (a) asset write-downs; (b) litigation or claim judgments or settlements; (c) the effect of changes in tax laws, accounting principles, or other laws or regulatory rules affecting reported results; (d) any reorganization and restructuring programs; (e) extraordinary nonrecurring items as described in Accounting Principles Board Opinion No. 30 (or any successor or pronouncement thereto) and/or in management's discussion and analysis of financial condition and results of operations appearing in the Company's annual report to shareholders for the applicable year; (f) acquisitions or divestitures; (g) any other specific unusual or nonrecurring events, or objectively determinable category thereof; (h) foreign exchange gains and losses; and (i) a change in the Company's fiscal year.

" Performance Period " means the one or more periods of time not less than one fiscal quarter in duration, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant's right to and the payment of a Performance Compensation Award.

" Performance Share Award " means any Award granted pursuant to Section 7.3 hereof.

" Performance Share " means the grant of a right to receive a number of actual shares of Common Stock or share units based upon the performance of the Company during a Performance Period, as determined by the Committee.

" Permitted Transferee " means: (a) a member of the Optionholder's immediate family (child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships), any person sharing the Optionholder's household (other than a tenant or employee), a trust in which these persons have more than 50% of the beneficial interest, a foundation in which these persons (or the Optionholder) control the management of assets, and any other entity in which these persons (or the Optionholder) own more than 50% of the voting interests; (b) third parties designated by the Committee in connection with a program established and approved by the Committee pursuant to which Participants may receive a cash payment or other consideration in consideration for the transfer of a Non-qualified Stock Option; and (c) such other transferees as may be permitted by the Committee in its sole discretion.

" Plan " means this Geospatial Holdings, Inc. 2013 Equity Incentive Plan, as amended and/or amended and restated from time to time.

" Related Rights " has the meaning set forth in Section 7.1(a) .

" Restricted Award " means any Award granted pursuant to Section 7.2(a).

" Restricted Period " has the meaning set forth in Section 7.2(a) .

" Rule 16b-3 " means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time.

" Securities Act " means the Securities Act of 1933, as amended.

" Stock Appreciation Right " means the right pursuant to an Award granted under Section 7.1 to receive, upon exercise, an amount payable in cash or shares equal to the number of shares subject to the Stock Appreciation Right that is being exercised multiplied by the excess of (a) the Fair Market Value of a share of Common Stock on the date the Award is exercised, over (b) the exercise price specified in the Stock Appreciation Right Award Agreement.

" Stock for Stock Exchange " has the meaning set forth in Section 6.4 .

" Ten Percent Shareholder " means a person who owns (or is deemed to own pursuant to Section 424(d) of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of any of its Affiliates.

3. Administration .

3.1 Authority of Committee . The Plan shall be administered by the Committee or, in the Board's sole discretion, by the Board. Subject to the terms of the Plan, the Committee's charter and Applicable Laws, and in addition to other express powers and authorization conferred by the Plan, the Committee shall have the authority:

(a) to construe and interpret the Plan and apply its provisions;

(b) to promulgate, amend, and rescind rules and regulations relating to the administration of the Plan;

(c) to authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan;

(d) to delegate its authority to one or more Officers of the Company with respect to Awards that do not involve Covered Employees or "insiders" within the meaning of Section 16 of the Exchange Act;

(e) to determine when Awards are to be granted under the Plan and the applicable Grant Date;

(f) from time to time to select, subject to the limitations set forth in this Plan, those Participants to whom Awards shall be granted;

(g) to determine the number of shares of Common Stock to be made subject to each Award;

(h) to determine whether each Option is to be an Incentive Stock Option or a Non-qualified Stock Option;

(i) to prescribe the terms and conditions of each Award, including, without limitation, the exercise price and medium of payment and vesting provisions, and to specify the provisions of the Award Agreement relating to such grant;

(j) to determine the target number of Performance Shares to be granted pursuant to a Performance Share Award, the performance measures that will be used to establish the performance goals, the performance period(s) and the number of Performance Shares earned by a Participant;

(k) to designate an Award (including a cash bonus) as a Performance Compensation Award and to select the Performance Criteria that will be used to establish the Performance Goals;

(l) to amend any outstanding Awards, including for the purpose of modifying the time or manner of vesting, or the term of any outstanding Award; provided, however , that if any such amendment impairs a Participant's rights or increases a Participant's obligations under his or her Award or creates or increases a Participant's federal income tax liability with respect to an Award, such amendment shall also be subject to the Participant's consent;

(m) to determine the duration and purpose of leaves of absences which may be granted to a Participant without constituting termination of their employment for purposes of the Plan, which periods shall be no shorter than the periods generally applicable to Employees under the Company's employment policies;

(n) to make decisions with respect to outstanding Awards that may become necessary upon a change in corporate control or an event that triggers anti-dilution adjustments;

(o) to interpret, administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in the Plan and any instrument or agreement relating to, or Award granted under, the Plan; and

(p) to exercise discretion to make any and all other determinations which it determines to be necessary or advisable for the administration of the Plan.

The Committee also may modify the purchase price or the exercise price of any outstanding Award, provided that if the modification effects a repricing, shareholder approval shall be required before the repricing is effective.

3.2 Committee Decisions Final . All decisions made by the Committee pursuant to the provisions of the Plan shall be final and binding on the Company and the Participants, unless such decisions are determined by a court having jurisdiction to be arbitrary and capricious.

3.3 Delegation . The Committee, or if no Committee has been appointed, the Board, may delegate administration of the Plan to a committee or committees of one or more members of the Board, and the term " Committee " shall apply to any person or persons to whom such authority has been delegated. The Committee shall have the power to delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board or the Committee shall thereafter be to the committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan. The members of the Committee shall be appointed by and serve at the pleasure of the Board. From time to time, the Board may increase or decrease the size of the Committee, add additional members to, remove members (with or without cause) from, appoint new members in substitution therefor, and fill vacancies, however caused, in the Committee. The Committee shall act pursuant to a vote of the majority of its members or, in the case of a Committee comprised of only two members, the unanimous consent of its members, whether present or not, or by the written consent of the majority of its members and minutes shall be kept of all of its meetings and copies thereof shall be provided to the Board. Subject to the limitations prescribed by the Plan and the Board, the Committee may establish and follow such rules and regulations for the conduct of its business as it may determine to be advisable.

3.4 Committee Composition . Except as otherwise determined by the Board, the Committee shall consist solely of two or more Non-Employee Directors who are also Outside Directors. The Board shall have discretion to determine whether or not it intends to comply with the exemption requirements of Rule 16b-3 and/or Section 162(m) of the Code. However, if the Board intends to satisfy such exemption requirements, with respect to Awards to any Covered Employee and with respect to any insider subject to Section 16 of the Exchange Act, the Committee shall be a compensation committee of the Board that at all times consists solely of two or more Non-Employee Directors who are also Outside Directors. Within the scope of such authority, the Board or the Committee may (a) delegate to a committee of one or more members of the Board who are not Outside Directors the authority to grant Awards to eligible persons who are either (i) not then Covered Employees and are not expected to be Covered Employees at the time of recognition of income resulting from such Award or (ii) not persons with respect to whom the Company wishes to comply with Section 162(m) of the Code or (b) delegate to a committee of one or more members of the Board who are not Non-Employee Directors the authority to grant Awards to eligible persons who are not then subject to Section 16 of the Exchange Act. Nothing herein shall create an inference that an Award is not validly granted under the Plan in the event Awards are granted under the Plan by a compensation committee of the Board that does not at all times consist solely of two or more Non-Employee Directors who are also Outside Directors.

3.5 Indemnification . In addition to such other rights of indemnification as they may have as Directors or members of the Committee, and to the extent allowed by Applicable Laws, the Committee shall be indemnified by the Company against the reasonable expenses, including attorney's fees, actually incurred in connection with any action, suit or proceeding or in connection with any appeal therein, to which the Committee may be party by reason of any action taken or failure to act under or in connection with the Plan or any Award granted under the Plan, and against all amounts paid by the Committee in settlement thereof ( provided, however , that the settlement has been approved by the Company, which approval shall not be unreasonably withheld) or paid by the Committee in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such Committee did not act in good faith and in a manner which such person reasonably believed to be in the best interests of the Company, or in the case of a criminal proceeding, had no reason to believe that the conduct complained of was unlawful; provided, however , that within sixty (60) days after institution of any such action, suit or proceeding, such Committee shall, in writing, offer the Company the opportunity at its own expense to handle and defend such action, suit or proceeding.

4. Shares Subject to the Plan .

4.1 Subject to adjustment in accordance with Section 11 , a total of 25,000,000 shares of Common Stock shall be available for the grant of Awards under the Plan; provided that , no more than 15,000,000 shares of Common Stock may be granted as Incentive Stock Options. During the terms of the Awards, the Company shall keep available at all times the number of shares of Common Stock required to satisfy such Awards.

4.2 Shares of Common Stock available for distribution under the Plan may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares reacquired by the Company in any manner.

4.3 Subject to adjustment in accordance with Section 11 , no Participant shall be granted, during any one (1) year period, Options to purchase Common Stock and Stock Appreciation Rights with respect to more than 3,000,000 shares of Common Stock in the aggregate or any other Awards with respect to more than 3,000,000 shares of Common Stock in the aggregate. If an Award is to be settled in cash, the number of shares of Common Stock on which the Award is based shall count toward the individual share limit set forth in this Section 4 .

4.4 Any shares of Common Stock subject to an Award that is canceled, forfeited or expires prior to exercise or realization, either in full or in part, shall again become available for issuance under the Plan. Notwithstanding anything to the contrary contained herein: shares subject to an Award under the Plan shall not again be made available for issuance or delivery under the Plan if such shares are (a) shares tendered in payment of an Option, (b) shares delivered or withheld by the Company to satisfy any tax withholding obligation, or (c) shares covered by a stock-settled Stock Appreciation Right or other Awards that were not issued upon the settlement of the Award.

5. Eligibility .

5.1 Eligibility for Specific Awards . Incentive Stock Options may be granted only to Employees. Awards other than Incentive Stock Options may be granted to Employees, Consultants and Directors and those individuals whom the Committee determines are reasonably expected to become Employees, Consultants and Directors following the Grant Date.

5.2 Ten Percent Shareholders . A Ten Percent Shareholder shall not be granted an Incentive Stock Option unless the Option Exercise Price is at least 110% of the Fair Market Value of the Common Stock at the Grant Date and the Option is not exercisable after the expiration of five years from the Grant Date.

6. Option Provisions . Each Option granted under the Plan shall be evidenced by an Award Agreement. Each Option so granted shall be subject to the conditions set forth in this Section 6 , and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement. All Options shall be separately designated Incentive Stock Options or Non-qualified Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates will be issued for shares of Common Stock purchased on exercise of each type of Option. Notwithstanding the foregoing, the Company shall have no liability to any Participant or any other person if an Option designated as an Incentive Stock Option fails to qualify as such at any time or if an Option is determined to constitute "nonqualified deferred compensation" within the meaning of Section 409A of the Code and the terms of such Option do not satisfy the requirements of Section 409A of the Code. The provisions of separate Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions:

6.1 Term . Subject to the provisions of Section 5.2 regarding Ten Percent Shareholders, no Incentive Stock Option shall be exercisable after the expiration of ten (10) years from the Grant Date. The term of a Non-qualified Stock Option granted under the Plan shall be determined by the Committee; provided, however , no Non-qualified Stock Option shall be exercisable after the expiration of ten (10) years from the Grant Date.

6.2 Exercise Price of An Incentive Stock Option . Subject to the provisions of Section 5.2 regarding Ten Percent Shareholders, the Option Exercise Price of each Incentive Stock Option shall be not less than 100% of the Fair Market Value of the Common Stock subject to the Option on the Grant Date. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an Option Exercise Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section 424(a) of the Code.

6.3 Exercise Price of a Non-qualified Stock Option . The Option Exercise Price of each Non-qualified Stock Option shall be not less than 100% of the Fair Market Value of the Common Stock subject to the Option on the Grant Date. Notwithstanding the foregoing, a Non-qualified Stock Option may be granted with an Option Exercise Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section 409A of the Code.

6.4 Consideration . The Option Exercise Price of Common Stock acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes and regulations, either (a) in cash or by certified or bank check at the time the Option is exercised or (b) in the discretion of the Committee, upon such terms as the Committee shall approve, the Option Exercise Price may be paid: (i) by delivery to the Company of other Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the Option Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of attestation whereby the Participant identifies for delivery specific shares of Common Stock that have an aggregate Fair Market Value on the date of attestation equal to the Option Exercise Price (or portion thereof) and receives a number of shares of Common Stock equal to the difference between the number of shares thereby purchased and the number of identified attestation shares of Common Stock (a " Stock for Stock Exchange "); (ii) a "cashless" exercise program established with a broker; (iii) by reduction in the number of shares of Common Stock otherwise deliverable upon exercise of such Option with a Fair Market Value equal to the aggregate Option Exercise Price at the time of exercise; (iv) any combination of the foregoing methods; or (v) in any other form of legal consideration that may be acceptable to the Committee. Unless otherwise specifically provided in the Option, the exercise price of Common Stock acquired pursuant to an Option that is paid by delivery (or attestation) to the Company of other Common Stock acquired, directly or indirectly from the Company, shall be paid only by shares of the Common Stock of the Company that have been held for more than six months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes). Notwithstanding the foregoing, during any period for which the Common Stock is publicly traded (i.e., the Common Stock is listed on any established stock exchange or a national market system) an exercise by a Director or Officer that involves or may involve a direct or indirect extension of credit or arrangement of an extension of credit by the Company, directly or indirectly, in violation of Section 402(a) of the Sarbanes-Oxley Act of 2002 shall be prohibited with respect to any Award under this Plan.

6.5 Transferability of An Incentive Stock Option . An Incentive Stock Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option.

6.6 Transferability of a Non-qualified Stock Option . A Non-qualified Stock Option may, in the sole discretion of the Committee, be transferable to a Permitted Transferee, upon written approval by the Committee to the extent provided in the Award Agreement. If the Non-qualified Stock Option does not provide for transferability, then the Non-qualified Stock Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option.

6.7 Vesting of Options . Each Option may, but need not, vest and therefore become exercisable in periodic installments that may, but need not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the Committee may deem appropriate. The vesting provisions of individual Options may vary. No Option may be exercised for a fraction of a share of Common Stock. The Committee may, but shall not be required to, provide for an acceleration of vesting and exercisability in the terms of any Award Agreement upon the occurrence of a specified event.

6.8 Termination of Continuous Service . Unless otherwise provided in an Award Agreement or in an employment agreement the terms of which have been approved by the Committee, in the event an Optionholder's Continuous Service terminates (other than upon the Optionholder's death or Disability), the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of termination) but only within such period of time ending on the earlier of (a) the date three months following the termination of the Optionholder's Continuous Service or (b) the expiration of the term of the Option as set forth in the Award Agreement; provided that , if the termination of Continuous Service is by the Company for Cause, all outstanding Options (whether or not vested) shall immediately terminate and cease to be exercisable. If, after termination, the Optionholder does not exercise his or her Option within the time specified in the Award Agreement, the Option shall terminate.

6.9 Extension of Termination Date . An Optionholder's Award Agreement may also provide that if the exercise of the Option following the termination of the Optionholder's Continuous Service for any reason would be prohibited at any time because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act or any other state or federal securities law or the rules of any securities exchange or interdealer quotation system, then the Option shall terminate on the earlier of (a) the expiration of the term of the Option in accordance with Section 6.1 or (b) the expiration of a period after termination of the Participant's Continuous Service that is three months after the end of the period during which the exercise of the Option would be in violation of such registration or other securities law requirements.

6.10 Disability of Optionholder . Unless otherwise provided in an Award Agreement, in the event that an Optionholder's Continuous Service terminates as a result of the Optionholder's Disability, the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of termination), but only within such period of time ending on the earlier of (a) the date twelve (12) months following such termination or (b) the expiration of the term of the Option as set forth in the Award Agreement. If, after termination, the Optionholder does not exercise his or her Option within the time specified herein or in the Award Agreement, the Option shall terminate.

6.11 Death of Optionholder . Unless otherwise provided in an Award Agreement, in the event an Optionholder's Continuous Service terminates as a result of the Optionholder's death, then the Option may be exercised (to the extent the Optionholder was entitled to exercise such Option as of the date of death) by the Optionholder's estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by a person designated to exercise the Option upon the Optionholder's death, but only within the period ending on the earlier of (a) the date twelve (12) months following the date of death or (b) the expiration of the term of such Option as set forth in the Award Agreement. If, after the Optionholder's death, the Option is not exercised within the time specified herein or in the Award Agreement, the Option shall terminate.

6.12 Incentive Stock Option $100,000 Limitation . To the extent that the aggregate Fair Market Value (determined at the time of grant) of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by any Optionholder during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, the Options or portions thereof which exceed such limit (according to the order in which they were granted) shall be treated as Non-qualified Stock Options.

7. Provisions of Awards Other Than Options .

7.1 Stock Appreciation Rights .

(a) General . Each Stock Appreciation Right granted under the Plan shall be evidenced by an Award Agreement. Each Stock Appreciation Right so granted shall be subject to the conditions set forth in this Section 7.1 , and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement. Stock Appreciation Rights may be granted alone (" Free Standing Rights ") or in tandem with an Option granted under the Plan (" Related Rights ").

(b) Grant Requirements , Any Related Right that relates to a Non-qualified Stock Option may be granted at the same time the Option is granted or at any time thereafter but before the exercise or expiration of the Option. Any Related Right that relates to an Incentive Stock Option must be granted at the same time the Incentive Stock Option is granted.

(c) Term of Stock Appreciation Rights . The term of a Stock Appreciation Right granted under the Plan shall be determined by the Committee; provided, however , no Stock Appreciation Right shall be exercisable later than the tenth anniversary of the Grant Date.

(d) Vesting of Stock Appreciation Rights . Each Stock Appreciation Right may, but need not, vest and therefore become exercisable in periodic installments that may, but need not, be equal. The Stock Appreciation Right may be subject to such other terms and conditions on the time or times when it may be exercised as the Committee may deem appropriate. The vesting provisions of individual Stock Appreciation Rights may vary. No Stock Appreciation Right may be exercised for a fraction of a share of Common Stock. The Committee may, but shall not be required to, provide for an acceleration of vesting and exercisability in the terms of any Stock Appreciation Right upon the occurrence of a specified event.

(e) Exercise and Payment . Upon exercise of a Stock Appreciation Right, the holder shall be entitled to receive from the Company an amount equal to the number of shares of Common Stock subject to the Stock Appreciation Right that is being exercised multiplied by the excess of (i) the Fair Market Value of a share of Common Stock on the date the Award is exercised, over (ii) the exercise price specified in the Stock Appreciation Right or related Option. Payment with respect to the exercise of a Stock Appreciation Right shall be made on the date of exercise. Payment shall be made in the form of shares of Common Stock (with or without restrictions as to substantial risk of forfeiture and transferability, as determined by the Committee in its sole discretion), cash or a combination thereof, as determined by the Committee.

(f) Exercise Price . The exercise price of a Free Standing Stock Appreciation Right shall be determined by the Committee, but shall not be less than 100% of the Fair Market Value of one share of Common Stock on the Grant Date of such Stock Appreciation Right. A Related Right granted simultaneously with or subsequent to the grant of an Option and in conjunction therewith or in the alternative thereto shall have the same exercise price as the related Option, shall be transferable only upon the same terms and conditions as the related Option, and shall be exercisable only to the same extent as the related Option; provided, however , that a Stock Appreciation Right, by its terms, shall be exercisable only when the Fair Market Value per share of Common Stock subject to the Stock Appreciation Right and related Option exceeds the exercise price per share thereof and no Stock Appreciation Rights may be granted in tandem with an Option unless the Committee determines that the requirements of Section 7.1(b) are satisfied.

(g) Reduction in the Underlying Option Shares . Upon any exercise of a Related Right, the number of shares of Common Stock for which any related Option shall be exercisable shall be reduced by the number of shares for which the Stock Appreciation Right has been exercised. The number of shares of Common Stock for which a Related Right shall be exercisable shall be reduced upon any exercise of any related Option by the number of shares of Common Stock for which such Option has been exercised.

7.2 Restricted Awards .

(a) General . A Restricted Award is an Award of actual shares of Common Stock (" Restricted Stock ") or hypothetical Common Stock units (" Restricted Stock Units ") having a value equal to the Fair Market Value of an identical number of shares of Common Stock, which may, but need not, provide that such Restricted Award may not be sold, assigned, transferred or otherwise disposed of, pledged or hypothecated as collateral for a loan or as security for the performance of any obligation or for any other purpose for such period (the " Restricted Period ") as the Committee shall determine. Each Restricted Award granted under the Plan shall be evidenced by an Award Agreement. Each Restricted Award so granted shall be subject to the conditions set forth in this Section 7.2 , and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement.

(b) Restricted Stock and Restricted Stock Units

(i) Each Participant granted Restricted Stock shall execute and deliver to the Company an Award Agreement with respect to the Restricted Stock setting forth the restrictions and other terms and conditions applicable to such Restricted Stock. If the Committee determines that the Restricted Stock shall be held by the Company or in escrow rather than delivered to the Participant pending the release of the applicable restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (A) an escrow agreement satisfactory to the Committee, if applicable and (B) the appropriate blank stock power with respect to the Restricted Stock covered by such agreement. If a Participant fails to execute an agreement evidencing an Award of Restricted Stock and, if applicable, an escrow agreement and stock power, the Award shall be null and void. Subject to the restrictions set forth in the Award, the Participant generally shall have the rights and privileges of a shareholder as to such Restricted Stock, including the right to vote such Restricted Stock and the right to receive dividends; provided that , any cash dividends and stock dividends with respect to the Restricted Stock shall be withheld by the Company for the Participant's account, and interest may be credited on the amount of the cash dividends withheld at a rate and subject to such terms as determined by the Committee. The cash dividends or stock dividends so withheld by the Committee and attributable to any particular share of Restricted Stock (and earnings thereon, if applicable) shall be distributed to the Participant in cash or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of such dividends, if applicable, upon the release of restrictions on such share and, if such share is forfeited, the Participant shall have no right to such dividends.

(ii) The terms and conditions of a grant of Restricted Stock Units shall be reflected in an Award Agreement. No shares of Common Stock shall be issued at the time a Restricted Stock Unit is granted, and the Company will not be required to set aside a fund for the payment of any such Award. A Participant shall have no voting rights with respect to any Restricted Stock Units granted hereunder. At the discretion of the Committee, each Restricted Stock Unit (representing one share of Common Stock) may be credited with cash and stock dividends paid by the Company in respect of one share of Common Stock (" Dividend Equivalents "). Dividend Equivalents shall be withheld by the Company for the Participant's account, and interest may be credited on the amount of cash Dividend Equivalents withheld at a rate and subject to such terms as determined by the Committee. Dividend Equivalents credited to a Participant's account and attributable to any particular Restricted Stock Unit (and earnings thereon, if applicable) shall be distributed in cash or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of such Dividend Equivalents and earnings, if applicable, to the Participant upon settlement of such Restricted Stock Unit and, if such Restricted Stock Unit is forfeited, the Participant shall have no right to such Dividend Equivalents.

(i) Restricted Stock awarded to a Participant shall be subject to the following restrictions until the expiration of the Restricted Period, and to such other terms and conditions as may be set forth in the applicable Award Agreement: (A) if an escrow arrangement is used, the Participant shall not be entitled to delivery of the stock certificate; (B) the shares shall be subject to the restrictions on transferability set forth in the Award Agreement; (C) the shares shall be subject to forfeiture to the extent provided in the applicable Award Agreement; and (D) to the extent such shares are forfeited, the stock certificates shall be returned to the Company, and all rights of the Participant to such shares and as a shareholder with respect to such shares shall terminate without further obligation on the part of the Company.

(ii) Restricted Stock Units awarded to any Participant shall be subject to (A) forfeiture until the expiration of the Restricted Period, and satisfaction of any applicable Performance Goals during such period, to the extent provided in the applicable Award Agreement, and to the extent such Restricted Stock Units are forfeited, all rights of the Participant to such Restricted Stock Units shall terminate without further obligation on the part of the Company and (B) such other terms and conditions as may be set forth in the applicable Award Agreement.

(iii) The Committee shall have the authority to remove any or all of the restrictions on the Restricted Stock and Restricted Stock Units whenever it may determine that, by reason of changes in Applicable Laws or other changes in circumstances arising after the date the Restricted Stock or Restricted Stock Units are granted, such action is appropriate.

(d) Restricted Period. With respect to Restricted Awards, the Restricted Period shall commence on the Grant Date and end at the time or times set forth on a schedule established by the Committee in the applicable Award Agreement.

No Restricted Award may be granted or settled for a fraction of a share of Common Stock. The Committee may, but shall not be required to, provide for an acceleration of vesting in the terms of any Award Agreement upon the occurrence of a specified event.

(e) Delivery of Restricted Stock and Settlement of Restricted Stock Units . Upon the expiration of the Restricted Period with respect to any shares of Restricted Stock, the restrictions set forth in Section 7.2(c) and the applicable Award Agreement shall be of no further force or effect with respect to such shares, except as set forth in the applicable Award Agreement. If an escrow arrangement is used, upon such expiration, the Company shall deliver to the Participant, or his or her beneficiary, without charge, the stock certificate evidencing the shares of Restricted Stock which have not then been forfeited and with respect to which the Restricted Period has expired (to the nearest full share) and any cash dividends or stock dividends credited to the Participant's account with respect to such Restricted Stock and the interest thereon, if any. Upon the expiration of the Restricted Period with respect to any outstanding Restricted Stock Units, the Company shall deliver to the Participant, or his or her beneficiary, without charge, one share of Common Stock for each such outstanding Restricted Stock Unit (" Vested Unit ") and cash equal to any Dividend Equivalents credited with respect to each such Vested Unit in accordance with Section 7.2(b)(ii) hereof and the interest thereon or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to such Dividend Equivalents and the interest thereon, if any; provided, however , that, if explicitly provided in the applicable Award Agreement, the Committee may, in its sole discretion, elect to pay cash or part cash and part Common Stock in lieu of delivering only shares of Common Stock for Vested Units. If a cash payment is made in lieu of delivering shares of Common Stock, the amount of such payment shall be equal to the Fair Market Value of the Common Stock as of the date on which the Restricted Period lapsed with respect to each Vested Unit.

(f) Stock Restrictions . Each certificate representing Restricted Stock awarded under the Plan shall bear a legend in such form as the Company deems appropriate.

7.3 Performance Share Awards .

(a) Grant of Performance Share Awards , Each Performance Share Award granted under the Plan shall be evidenced by an Award Agreement. Each Performance Share Award so granted shall be subject to the conditions set forth in this Section 7.3 , and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement. The Committee shall have the discretion to determine: (i) the number of shares of Common Stock or stock-denominated units subject to a Performance Share Award granted to any Participant; (ii) the performance period applicable to any Award; (iii) the conditions that must be satisfied for a Participant to earn an Award; and (iv) the other terms, conditions and restrictions of the Award.

(b) Earning Performance Share Awards . The number of Performance Shares earned by a Participant will depend on the extent to which the performance goals established by the Committee are attained within the applicable Performance Period, as determined by the Committee. No payout shall be made with respect to any Performance Share Award except upon written certification by the Committee that the minimum threshold performance goal(s) have been achieved.

7.4 Performance Compensation Awards .

(a) General . The Committee shall have the authority, at the time of grant of any Award described in this Plan (other than Options and Stock Appreciation Rights granted with an exercise price equal to or greater than the Fair Market Value per share of Common Stock on the Grant Date), to designate such Award as a Performance Compensation Award in order to qualify such Award as "performance-based compensation" under Section 162(m) of the Code. In addition, the Committee shall have the authority to make an Award of a cash bonus to any Participant and designate such Award as a Performance Compensation Award in order to qualify such Award as "performance-based compensation" under Section 162(m) of the Code.

(b) Eligibility. The Committee will, in its sole discretion, designate within the first 90 days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code) which Participants will be eligible to receive Performance Compensation Awards in respect of such Performance Period. However, designation of a Participant eligible to receive an Award hereunder for a Performance Period shall not in any manner entitle the Participant to receive payment in respect of any Performance Compensation Award for such Performance Period. The determination as to whether or not such Participant becomes entitled to payment in respect of any Performance Compensation Award shall be decided solely in accordance with the provisions of this Section 7.4 . Moreover, designation of a Participant eligible to receive an Award hereunder for a particular Performance Period shall not require designation of such Participant eligible to receive an Award hereunder in any subsequent Performance Period and designation of one person as a Participant eligible to receive an Award hereunder shall not require designation of any other person as a Participant eligible to receive an Award hereunder in such period or in any other period.

(c) Discretion of Committee with Respect to Performance Compensation Awards , With regard to a particular Performance Period, the Committee shall have full discretion to select the length of such Performance Period (provided any such Performance Period shall be not less than one fiscal quarter in duration), the type(s) of Performance Compensation Awards to be issued, the Performance Criteria that will be used to establish the Performance Goal(s), the kind(s) and/or level(s) of the Performance Goal(s) that is (are) to apply to the Company and the Performance Formula. Within the first ninety (90) days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code), the Committee shall, with regard to the Performance Compensation Awards to be issued for such Performance Period, exercise its discretion with respect to each of the matters enumerated in the immediately preceding sentence of this Section 7.4(c) and record the same in writing.

(d) Payment of Performance Compensation Awards

(i) Condition to Receipt of Payment . Unless otherwise provided in the applicable Award Agreement, a Participant must be employed by the Company on the last day of a Performance Period to be eligible for payment in respect of a Performance Compensation Award for such Performance Period.

(ii) Limitation . A Participant shall be eligible to receive payment in respect of a Performance Compensation Award only to the extent that: (A) the Performance Goals for such period are achieved; and (B) the Performance Formula as applied against such Performance Goals determines that all or some portion of such Participant's Performance Compensation Award has been earned for the Performance Period.

(iii) Certification . Following the completion of a Performance Period, the Committee shall review and certify in writing whether, and to what extent, the Performance Goals for the Performance Period have been achieved and, if so, calculate and certify in writing the amount of the Performance Compensation Awards earned for the period based upon the Performance Formula. The Committee shall then determine the actual size of each Participant's Performance Compensation Award for the Performance Period and, in so doing, may apply Negative Discretion in accordance with Section 7.4(d)(iv) hereof, if and when it deems appropriate.

(iv) Use of Discretion . In determining the actual size of an individual Performance Compensation Award for a Performance Period, the Committee may reduce or eliminate the amount of the Performance Compensation Award earned under the Performance Formula in the Performance Period through the use of Negative Discretion if, in its sole judgment, such reduction or elimination is appropriate. The Committee shall not have the discretion to (A) grant or provide payment in respect of Performance Compensation Awards for a Performance Period if the Performance Goals for such Performance Period have not been attained or (B) increase a Performance Compensation Award above the maximum amount payable under Section 7.4(d)(vi) of the Plan.

(v) Timing of Award Payments . Performance Compensation Awards granted for a Performance Period shall be paid to Participants as soon as administratively practicable following completion of the certifications required by this Section 7.4 .

(vi) Maximum Award Payable . Notwithstanding any provision contained in this Plan to the contrary, the maximum Performance Compensation Award payable to any one Participant under the Plan for a Performance Period (excluding any Options and Stock Appreciation Rights) is 3,000,000 shares of Common Stock or, in the event such Performance Compensation Award is paid in cash, the equivalent cash value thereof on the first or last day of the Performance Period to which such Award relates, as determined by the Committee. The maximum amount that can be paid in any calendar year to any Participant pursuant to a cash bonus Award described in the last sentence of Section 7.4(a) shall be $1,000,000. Furthermore, any Performance Compensation Award that has been deferred shall not (between the date as of which the Award is deferred and the payment date) increase (A) with respect to a Performance Compensation Award that is payable in cash, by a measuring factor for each fiscal year greater than a reasonable rate of interest set by the Committee or (B) with respect to a Performance Compensation Award that is payable in shares of Common Stock, by an amount greater than the appreciation of a share of Common Stock from the date such Award is deferred to the payment date.

8. Securities Law Compliance . Each Award Agreement shall provide that no shares of Common Stock shall be purchased or sold thereunder unless and until (a) any then applicable requirements of state or federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel and (b) if required to do so by the Company, the Participant has executed and delivered to the Company a letter of investment intent in such form and containing such provisions as the Committee may require. The Company shall use reasonable efforts to seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Awards and to issue and sell shares of Common Stock upon exercise of the Awards; provided, however , that this undertaking shall not require the Company to register under the Securities Act the Plan, any Award or any Common Stock issued or issuable pursuant to any such Award. If, after reasonable efforts, the Company is unable to obtain from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of Common Stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell Common Stock upon exercise of such Awards unless and until such authority is obtained.

9. Use of Proceeds from Stock . Proceeds from the sale of Common Stock pursuant to Awards, or upon exercise thereof, shall constitute general funds of the Company.

10. Miscellaneous .

10.1 Acceleration of Exercisability and Vesting . The Committee shall have the power to accelerate the time at which an Award may first be exercised or the time during which an Award or any part thereof will vest in accordance with the Plan, notwithstanding the provisions in the Award stating the time at which it may first be exercised or the time during which it will vest.

10.2 Shareholder Rights . Except as provided in the Plan or an Award Agreement, no Participant shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares of Common Stock subject to such Award unless and until such Participant has satisfied all requirements for exercise of the Award pursuant to its terms and no adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distributions of other rights for which the record date is prior to the date such Common Stock certificate is issued, except as provided in Section 11 hereof.

10.3 No Employment or Other Service Rights . Nothing in the Plan or any instrument executed or Award granted pursuant thereto shall confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Award was granted or shall affect the right of the Company or an Affiliate to terminate (a) the employment of an Employee with or without notice and with or without Cause or (b) the service of a Director pursuant to the By-laws of the Company or an Affiliate, and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.

10.4 Transfer; Approved Leave of Absence . For purposes of the Plan, no termination of employment by an Employee shall be deemed to result from either (a) a transfer to the employment of the Company from an Affiliate or from the Company to an Affiliate, or from one Affiliate to another, or (b) an approved leave of absence for military service or sickness, or for any other purpose approved by the Company, if the Employee's right to reemployment is guaranteed either by a statute or by contract or under the policy pursuant to which the leave of absence was granted or if the Committee otherwise so provides in writing, in either case, except to the extent inconsistent with Section 409A of the Code if the applicable Award is subject thereto.

10.5 Withholding Obligations . To the extent provided by the terms of an Award Agreement and subject to the discretion of the Committee, the Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Common Stock under an Award by any of the following means (in addition to the Company's right to withhold from any compensation paid to the Participant by the Company) or by a combination of such means: (a) tendering a cash payment; (b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as a result of the exercise or acquisition of Common Stock under the Award, provided, however , that no shares of Common Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares of Common Stock of the Company.

11. Adjustments Upon Changes in Stock . In the event of changes in the outstanding Common Stock or in the capital structure of the Company by reason of any stock or extraordinary cash dividend, stock split, reverse stock split, an extraordinary corporate transaction such as any recapitalization, reorganization, merger, consolidation, combination, exchange, or other relevant change in capitalization occurring after the Grant Date of any Award, Awards granted under the Plan and any Award Agreements, the exercise price of Options and Stock Appreciation Rights, the maximum number of shares of Common Stock subject to all Awards stated in Section 4 and the maximum number of shares of Common Stock with respect to which any one person may be granted Awards during any period stated in Section 4 and Section 7.4(d)(vi) will be equitably adjusted or substituted, as to the number, price or kind of a share of Common Stock or other consideration subject to such Awards to the extent necessary to preserve the economic intent of such Award. In the case of adjustments made pursuant to this Section 11 , unless the Committee specifically determines that such adjustment is in the best interests of the Company or its Affiliates, the Committee shall, in the case of Incentive Stock Options, ensure that any adjustments under this Section 11 will not constitute a modification, extension or renewal of the Incentive Stock Options within the meaning of Section 424(h)(3) of the Code and in the case of Non-qualified Stock Options, ensure that any adjustments under this Section 11 will not constitute a modification of such Non-qualified Stock Options within the meaning of Section 409A of the Code. Any adjustments made under this Section 11 shall be made in a manner which does not adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange Act. Further, with respect to Awards intended to qualify as "performance-based compensation" under Section 162(m) of the Code, any adjustments or substitutions will not cause the Company to be denied a tax deduction on account of Section 162(m) of the Code. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive and binding for all purposes.

12. Effect of Change in Control .

12.1 Unless otherwise provided in an Award Agreement, notwithstanding any provision of the Plan to the contrary:

(a) In the event of a Change in Control, all Options and Stock Appreciation Rights shall become immediately exercisable with respect to 100% of the shares subject to such Options or Stock Appreciation Rights, and/or the Restricted Period shall expire immediately with respect to 100% of the shares of Restricted Stock or Restricted Stock Units.

(b) With respect to Performance Compensation Awards, in the event of a Change in Control, all incomplete Performance Periods in respect of such Award in effect on the date the Change in Control occurs shall end on the date of such change and the Committee shall (i) determine the extent to which Performance Goals with respect to each such Performance Period have been met based upon such audited or unaudited financial information then available as it deems relevant and (ii) cause to be paid to the applicable Participant partial or full Awards with respect to Performance Goals for each such Performance Period based upon the Committee's determination of the degree of attainment of Performance Goals or, if not determinable, assuming that the applicable "target" levels of performance have been attained, or on such other basis determined by the Committee.

To the extent practicable, any actions taken by the Committee under the immediately preceding clauses (a) and (b) shall occur in a manner and at a time which allows affected Participants the ability to participate in the Change in Control with respect to the shares of Common Stock subject to their Awards.

12.2 In addition, in the event of a Change in Control, the Committee may in its discretion and upon at least 10 days' advance notice to the affected persons, cancel any outstanding Awards and pay to the holders thereof, in cash or stock, or any combination thereof, the value of such Awards based upon the price per share of Common Stock received or to be received by other shareholders of the Company in the event. In the case of any Option or Stock Appreciation Right with an exercise price (or SAR Exercise Price in the case of a Stock Appreciation Right) that equals or exceeds the price paid for a share of Common Stock in connection with the Change in Control, the Committee may cancel the Option or Stock Appreciation Right without the payment of consideration therefor.

12.3 The obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the merger, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to all or substantially all of the assets and business of the Company and its Affiliates, taken as a whole.

13. Amendment of the Plan and Awards .

13.1 Amendment of Plan . The Board at any time, and from time to time, may amend or terminate the Plan. However, except as provided in Section11 relating to adjustments upon changes in Common Stock and Section 13.3 , no amendment shall be effective unless approved by the shareholders of the Company to the extent shareholder approval is necessary to satisfy any Applicable Laws. At the time of such amendment, the Board shall determine, upon advice from counsel, whether such amendment will be contingent on shareholder approval.

13.2 Shareholder Approval . The Board may, in its sole discretion, submit any other amendment to the Plan for shareholder approval, including, but not limited to, amendments to the Plan intended to satisfy the requirements of Section 162(m) of the Code and the regulations thereunder regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to certain executive officers.

13.3 Contemplated Amendments . It is expressly contemplated that the Board may amend the Plan in any respect the Board deems necessary or advisable to provide eligible Employees, Consultants and Directors with the maximum benefits provided or to be provided under the provisions of the Code and the regulations promulgated thereunder relating to Incentive Stock Options or to the nonqualified deferred compensation provisions of Section 409A of the Code and/or to bring the Plan and/or Awards granted under it into compliance therewith.

13.4 No Impairment of Rights . Rights under any Award granted before amendment of the Plan shall not be impaired by any amendment of the Plan unless (a) the Company requests the consent of the Participant and (b) the Participant consents in writing.

13.5 Amendment of Awards . The Committee at any time, and from time to time, may amend the terms of any one or more Awards; provided, however , that the Committee may not affect any amendment which would otherwise constitute an impairment of the rights under any Award unless (a) the Company requests the consent of the Participant and (b) the Participant consents in writing.

14. General Provisions .

14.1 Forfeiture Events . The Committee may specify in an Award Agreement that the Participant's rights, payments and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture or recoupment upon the occurrence of certain events, in addition to applicable vesting conditions of an Award. Such events may include, without limitation, breach of non-competition, non-solicitation, confidentiality, or other restrictive covenants that are contained in the Award Agreement or otherwise applicable to the Participant, a termination of the Participant's Continuous Service for Cause, or other conduct by the Participant that is detrimental to the business or reputation of the Company and/or its Affiliates.

14.2 Clawback . Notwithstanding any other provisions in this Plan, any Award which is subject to recovery under any law, government regulation or stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement (or any policy adopted by the Company pursuant to any such law, government regulation or stock exchange listing requirement).

14.3 Other Compensation Arrangements . Nothing contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to shareholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific cases.

14.4 Sub-plans . The Committee may from time to time establish sub-plans under the Plan for purposes of satisfying blue sky, securities, tax or other laws of various jurisdictions in which the Company intends to grant Awards. Any sub-plans shall contain such limitations and other terms and conditions as the Committee determines are necessary or desirable. All sub-plans shall be deemed a part of the Plan, but each sub-plan shall apply only to the Participants in the jurisdiction for which the sub-plan was designed.

14.5 Deferral of Awards . The Committee may establish one or more programs under the Plan to permit selected Participants the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Participant to payment or receipt of shares of Common Stock or other consideration under an Award. The Committee may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts, shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Committee deems advisable for the administration of any such deferral program.

14.6 Unfunded Plan . The Plan shall be unfunded. Neither the Company, the Board nor the Committee shall be required to establish any special or separate fund or to segregate any assets to assure the performance of its obligations under the Plan.

14.7 Recapitalizations . Each Award Agreement shall contain provisions required to reflect the provisions of Section 11 .

14.8 Delivery . Upon exercise of a right granted under this Plan, the Company shall issue Common Stock or pay any amounts due within a reasonable period of time thereafter. Subject to any statutory or regulatory obligations the Company may otherwise have, for purposes of this Plan, 30 days shall be considered a reasonable period of time.

14.9 No Fractional Shares . No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan. The Committee shall determine whether cash, additional Awards or other securities or property shall be issued or paid in lieu of fractional shares of Common Stock or whether any fractional shares should be rounded, forfeited or otherwise eliminated.

14.10 Other Provisions . The Award Agreements authorized under the Plan may contain such other provisions not inconsistent with this Plan, including, without limitation, restrictions upon the exercise of the Awards, as the Committee may deem advisable.

14.11 Section 409A . The Plan is intended to comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the maximum extent permitted, the Plan shall be interpreted and administered to be in compliance therewith. Any payments described in the Plan that are due within the "short-term deferral period" as defined in Section 409A of the Code shall not be treated as deferred compensation unless Applicable Laws require otherwise. Notwithstanding anything to the contrary in the Plan, to the extent required to avoid accelerated taxation and tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to the Plan during the six (6) month period immediately following the Participant's termination of Continuous Service shall instead be paid on the first payroll date after the six-month anniversary of the Participant's separation from service (or the Participant's death, if earlier). Notwithstanding the foregoing, neither the Company nor the Committee shall have any obligation to take any action to prevent the assessment of any excise tax or penalty on any Participant under Section 409A of the Code and neither the Company nor the Committee will have any liability to any Participant for such tax or penalty.

14.12 Disqualifying Dispositions . Any Participant who shall make a "disposition" (as defined in Section 424 of the Code) of all or any portion of shares of Common Stock acquired upon exercise of an Incentive Stock Option within two years from the Grant Date of such Incentive Stock Option or within one year after the issuance of the shares of Common Stock acquired upon exercise of such Incentive Stock Option (a " Disqualifying Disposition ") shall be required to immediately advise the Company in writing as to the occurrence of the sale and the price realized upon the sale of such shares of Common Stock.

14.13 Section 16 . It is the intent of the Company that the Plan satisfy, and be interpreted in a manner that satisfies, the applicable requirements of Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit of Rule 16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of the Plan would conflict with the intent expressed in this Section 14.13 , such provision to the extent possible shall be interpreted and/or deemed amended so as to avoid such conflict.

14.14 Section 162(m) . To the extent the Committee issues any Award that is intended to be exempt from the deduction limitation of Section 162(m) of the Code, the Committee may, without shareholder or grantee approval, amend the Plan or the relevant Award Agreement retroactively or prospectively to the extent it determines necessary in order to comply with any subsequent clarification of Section 162(m) of the Code required to preserve the Company's federal income tax deduction for compensation paid pursuant to any such Award.

14.15 Beneficiary Designation . Each Participant under the Plan may from time to time name any beneficiary or beneficiaries by whom any right under the Plan is to be exercised in case of such Participant's death. Each designation will revoke all prior designations by the same Participant, shall be in a form reasonably prescribed by the Committee and shall be effective only when filed by the Participant in writing with the Company during the Participant's lifetime.

14.16 Expenses . The costs of administering the Plan shall be paid by the Company.

14.17 Severability . If any of the provisions of the Plan or any Award Agreement is held to be invalid, illegal or unenforceable, whether in whole or in part, such provision shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability and the remaining provisions shall not be affected thereby.

14.18 Plan Headings . The headings in the Plan are for purposes of convenience only and are not intended to define or limit the construction of the provisions hereof.

14.19 Non-Uniform Treatment . The Committee's determinations under the Plan need not be uniform and may be made by it selectively among persons who are eligible to receive, or actually receive, Awards. Without limiting the generality of the foregoing, the Committee shall be entitled to make non-uniform and selective determinations, amendments and adjustments, and to enter into non-uniform and selective Award Agreements.

15. Effective Date of Plan . The Plan shall become effective as of the Effective Date, but no Award shall be exercised (or, in the case of a stock Award, shall be granted) unless and until the Plan has been approved by the shareholders of the Company, which approval shall be within twelve (12) months before or after the date the Plan is adopted by the Board.

16. Termination or Suspension of the Plan . The Plan shall terminate automatically on September 20, 2023. No Award shall be granted pursuant to the Plan after such date, but Awards theretofore granted may extend beyond that date. The Board may suspend or terminate the Plan at any earlier date pursuant to Section 13.1 hereof. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated. Unless the Company determines to submit Section 7.4 of the Plan and the definition of "Performance Goal" and "Performance Criteria" to the Company's shareholders at the first shareholder meeting that occurs in the fifth year following the year in which the Plan was last approved by shareholders (or any earlier meeting designated by the Board), in accordance with the requirements of Section 162(m) of the Code, and such shareholder approval is obtained, then no further Performance Compensation Awards shall be made to Covered Employees under Section 7.4 after the date of such annual meeting, but the Plan may continue in effect for Awards to Participants not in accordance with Section 162(m) of the Code.

17. Choice of Law . The law of the State of Nevada shall govern all questions concerning the construction, validity and interpretation of this Plan, without regard to such state's conflict of law rules.

As adopted by the Board of Directors of Geospatial Holdings, Inc. on September 23, 2013.

As approved by the shareholders of Geospatial Holdings, Inc. on September 23, 2013.

Geospatial Corporation S-1

Exhibit 10.3

GEOSPATIAL HOLDINGS, INC.

2007 STOCK OPTION PLAN

(AS AMENDED AND RESTATED APRIL 25, 2008)

GEOSPATIAL HOLDINGS, INC. 2007 STOCK OPTION PLAN

(AS AMENDED AND RESTATED APRIL 25, 2008)

Article 1. Establishment, Objectives and Duration

1.1 Establishment of the Plan. Geospatial Mapping Systems, Inc., a Delaware corporation (“Geospatial”), adopted the “Geospatial Mapping Systems, Inc. 2007 Stock Option Plan,” effective December 1, 2007. Effective April 25, 2008, Geospatial Holdings, Inc.., a Nevada corporation, assumed the Plan and amended and restated the Plan, as set forth in this document. Options granted prior to April 25, 2008, will continue to be governed by the terms and conditions of this Plan. Capitalized terms will have the meanings given to them in Article 2 . The Plan permits the grant of Incentive Stock Options and Nonqualified Stock Options.

1.2 Objectives of the Plan. The Plan’s purpose is to optimize the profitability and growth of the Company through long-term incentives that are consistent with the Company’s objectives and that link Participants’ interests to those of the Company’s shareholders; to give Participants an incentive for excellence in individual performance; and to give the Company a significant advantage in attracting and retaining key employees, directors and consultants.

1.3 Effective Date and Term of the Plan. The amendment and restatement of the Plan will be effective on the Effective Date. The Committee may make Awards and issue Shares under the Plan at any time after the Effective Date and before the date fixed herein for termination of the Plan. The Plan will terminate upon the earliest of (i) the tenth anniversary of the Effective Date, (ii) the date on which all Shares available for issuance under the Plan have been issued pursuant to the exercise of Options under the Plan, or (iii) the date specified by action of the Board. Upon such Plan termination, all Awards outstanding under the Plan will continue to have full force and effect in accordance with the terms of the Option Agreement evidencing such Award.

Article 2. Definitions

Whenever used in the Plan, the following terms have the meanings set forth below, and when the meaning is intended, the initial letter of the word will be capitalized:

2.1 “Affiliate” means (a) for purposes of Incentive Stock Options, any corporation that is a parent or subsidiary (as those terms are defined in Code Sections 424(e) and (f)) of the Company, and (b) for all other purposes hereunder, an entity that (directly or indirectly) is controlled by, controls, or is under common control with the Company.

2.2 “Award” means, individually or collectively, a grant under this Plan of an Option to a Participant.

2.3 “Board” or “Board of Directors” means the Board of Directors of the Company.

2.4 “Cause” will have the meaning set forth in any employment, consulting, or other agreement between any of the Company Parties and the Participant. If there is no employment, consulting, or other agreement between any of the Company Parties and the Participant, or if such agreement does not define “Cause,” then “Cause” will mean the Participant’s (i) conviction of, or plea of nolo contendere to, a felony or a crime involving an act of moral turpitude, dishonesty or misfeasance; (ii) engagement in any type of disloyalty to any Company Party, including without limitation, fraud, embezzlement, theft, or dishonesty; (iii) unauthorized disclosure of trade secrets or confidential information of any Company Party; (iv) material breach of any confidentiality agreement or non-competition agreement with any Company Party; (v) material breach by the Participant of any agreement relating to Participant’s employment with any Company Party that is not cured within ten (10) days after notice of such breach to the Participant; or (iv) gross misconduct that is injurious to any of the Company Parties.

2.5 “Change in Control” means the occurrence of any of the following events:

(i) Any “person” (as defined in Sections 13(d) and 14(d) of the Exchange Act), excluding for this purpose, (a) the Participant, (b) the Company or any subsidiary of the Company, or (c) any employee benefit plan of the Company or of any subsidiary of the Company, or any person or entity organized, appointed, or established by the Company for or pursuant to the terms of any such plan that acquires beneficial ownership of voting securities of the Company, becomes (or has become during the 12-month period ending on the date of the most recent acquisition by such person) the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly of securities of the Company representing more than thirty-five percent (35%) of the combined voting power of the Company’s then outstanding securities; provided , however , that no Change in Control will be deemed to have occurred as a result of a change in ownership percentage resulting solely from an acquisition of securities by the Company;

(ii) Individuals who constitute the Board as of the Effective Date (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board during any 12-month period, provided that any person becoming a director on the Board subsequent thereto whose election or nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval by the stockholders pursuant to a proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director; provided , however , that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to directors or as a result of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director; or

(iii) Consummation of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, fifty percent (50%) or more of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all of substantially all of the Company’s assets either directly or through one ore more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company.

2.6 “Code” means the Internal Revenue Code of 1986, as amended.

2.7 “Committee” means the Compensation Committee of the Board or such other committee of the Board (which may be the Board as a whole) designated by the Board to administer the Plan pursuant to Article 3 hereof.

2.8 “Common Stock” means the Company’s common stock, $0.001 par value per share, and any successor securities thereto, including pursuant to a stock dividend, a stock split, reclassification or like action, or pursuant to an exchange (including a merger).

2.9 “Company” means Geospatial Holdings, Inc., a Nevada corporation, and any successor thereto as provided in Article 12 .

2.10 “Company Parties” means, collectively and without duplication, the Company and any of its Affiliates.

2.11 “Consultant” means a consultant, advisor or other independent service provider engaged by a Company Party to render services to such Company Party and who is not a Director or an Employee.

2.12 “Designated Beneficiary” means the Person or Persons the Participant designates (who may be designated contingently or successively) from time to time on a signed form prescribed by the Committee, filed with the Company during the Participant’s lifetime, as the beneficiary of any amounts or benefits the Participant owns or is to receive under the Plan. Each beneficiary designation will revoke all prior designations by the same Participant. If the Participant has not designated a beneficiary under the Plan, or if the Participant’s Designated Beneficiary is not living on the relevant date hereunder, the Company will treat the Participant’s estate as the Designated Beneficiary.

2.13 “Director” means any individual who is a member of the Board or the board of directors of any other Company Party.

2.14 “Disability” will have the meaning set forth in any long-term disability policy or program sponsored by the Company or any Affiliate covering the Participant, as in effect as of the date of such determination; provided , however , if no such policy or program shall be in effect, “Disability” shall have the meaning set forth in any employment, consulting, or other agreement between any of the Company Parties and the Participant. A Participant bound by such agreement shall not be determined to be Disabled under the Plan any earlier than he or she would be determined to be disabled under such agreement. If there is no employment, consulting, or other agreement between any of the Company Parties and the Participant, or if such agreement does not define “Disability,” then “Disability” will mean any physical or mental impairment that can be expected to last for a continuous period of at least twelve (12) months and renders the Participant unable to engage in any substantial gainful activity, as determined in the Committee’s good faith judgment.

2.15 “Effective Date” means April 25, 2008.

2.16 “Employee” means a person employed by any of the Company Parties, whether by contract or in a common law employee-employer relationship.

2.17 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor act thereto.

2.18 “Exercise Price” means the price at which a Participant may purchase a Share pursuant to an Option.

2.19 “Fair Market Value” means on any date, as it relates to a Share: (i) if the Shares are readily tradable on an established securities market, (x) the average of the high and low prices of such Shares as reported on the principal national securities exchange on which the Shares are then listed on the date specified herein, or if there were no sales on such date, on the next preceding day on which there were sales, or (y) if such Shares are not listed on a national securities exchange, the average of the last reported bid price in the over-the-counter market for such Shares for each of the 20 Business Days preceding the specified date; and (ii) if the Shares are not readily tradable on an established securities market, the value determined by any means determined fair and reasonable by the Board, which determination shall be final and binding on all parties.

2.20 “Fiscal Year” means the 12-consecutive month period coinciding with the Company’s fiscal year.

2.21 “Geospatial” means Geospatial Mapping Systems, Inc., a Delaware corporation.

2.22 “Incentive Stock Option” or “ISO” means an Option that the Board designates as an Incentive Stock Option and that is intended to meet the requirements of Code Section 422.

2.22 “Nonqualified Stock Option” means either an Option designated as a Nonqualified Stock Option that is not intended to meet the requirements of Code Section 422 or an Option designated as an ISO but which, for any reason, fails to qualify as an ISO under Code Section 422 and the rules and regulations thereunder.

2.23 “Option” means an option to purchase Shares granted under Article 6.

2.24 “Option Agreement” means an agreement entered into between the Company and a Participant setting forth the terms and provisions applicable to an Award or Awards granted to the Participant.

2.25 “Owned Shares” means Shares that a Participant has acquired through the exercise of an Option, in accordance with Article 6 and the terms of any Option Agreement.

2.26 “Participant” means a Person selected by the Committee to receive an Award under the Plan, pursuant to Section 5.2 , or who has an outstanding Award granted under the Plan.

2.27 “Person” means any individual, partnership, limited partnership, corporation, limited liability company or partnership, association, joint stock company, trust, joint venture, unincorporated organization, or the United States of America or any other nation, any state or other political subdivision thereof, or any entity exercising executive, legislative, judicial, regulatory or administrative functions of government.

2.28 “Plan” means the Geospatial Holdings, Inc. 2007 Stock Option Plan, as set forth in this document and as amended from time to time.

2.29 “Prior Plan” means the Geospatial Mapping Systems, Inc. 2007 Stock Option Plan.

2.30 “Public Offering” means a public offering of Common Stock (or the securities of any successor to the Company) pursuant to an effective registration statement under the Securities Act.

2.31 “Securities Act” means the Securities Act of 1933, as amended from time to time, or any successor act thereto.

2.32 “Service” means the provision of services in the capacity of (i) an Employee, (ii) a Director, or (iii) a Consultant.

2.33 “Stockholders” means the stockholders of the Company.

2.34 “Shares” means shares of Common Stock.

Article 3. Administration

3.1 Administrator. Except as otherwise determined by the Board, the Plan shall be administered by the Committee.

3.2 Authority of the Committee. Except as limited by law and subject to the provisions of this Plan, the Committee will have full power to: (i) select eligible Persons to participate in the Plan; (ii) determine the sizes and types of Awards; (iii) determine the terms and conditions of Awards in a manner consistent with the Plan; (iv) construe and interpret the Plan and any agreement or instrument entered into under the Plan; (v) establish, amend or waive rules and regulations for the Plan’s administration; (vi) specify the Exercise Price; and (vii) subject to the provisions of Article 10 , amend the Plan or the terms and conditions of any outstanding Award to the extent the terms are within the Committee’s discretion under the Plan. Further, the Committee will make all other determinations that may be necessary or advisable to administer the Plan. The Committee may delegate some or all of its authority under the Plan.

It is the Company’s intent that Awards are not to be treated as deferred compensation under Code Section 409A (or any regulations or other guidance promulgated thereunder) and that any ambiguities in construction be interpreted in order to effectuate such intent. Awards under the Plan shall contain such terms as the Committee determines are appropriate to avoid the application of Code Section 409A. In the event that, after the issuance of an Award under the Plan, Code Section 409A or regulations thereunder are issued or amended, or the Internal Revenue Service or Treasury Department issues additional guidance interpreting Code Section 409A, the Committee may (but shall have no obligation to do so) amend or modify the terms of any such previously issued Award to the extent the Committee determines that such amendment or modification is necessary to avoid the application of, or to comply with, Code Section 409A.

3.3 Decisions Binding. All determinations and decisions made by the Board or Committee pursuant to the provisions of the Plan will be final, conclusive and binding on all Persons, including, without limitation, the Company, its Board of Directors, the Stockholders, all Affiliates, Employees, Participants and their estates and beneficiaries.

Article 4. Shares Subject to the Plan and Maximum Awards

4.1 Number of Shares Available for Grants. Subject to adjustment as provided in Section 4.4 , no more than fifteen million (15,000,000) Shares may be subject to Awards under the Plan. Shares issued in connection with Awards that are assumed, converted or substituted pursuant to a merger, acquisition or similar transaction entered into by the Company or any of its Affiliates shall not reduce the number of Shares available under this Plan.

4.2 Limits on ISOs. The maximum number of Shares that may be issued or transferred to Participants and their beneficiaries with respect to ISOs granted under the Plan shall be fifteen million (15,000,000) Shares. The maximum number of Shares that may be granted during any calendar year to any one Participant under all types of Awards under the Plan is five million (5,000,000) (on an aggregate basis).

4.3 Lapsed Awards. If any Award granted under this Plan is canceled, terminates, expires or lapses for any reason, any Shares subject to such Award will again be available for the grant of an Award under the Plan. Any Shares underlying an Option that is surrendered by a Participant in a cashless exercise transaction will again be available for the grant of an Award under the Plan.

4.4 Adjustments in Authorized Shares. If the Shares, as currently constituted, are changed into or exchanged for a different number or kind of shares of stock or other securities of the Company or of another entity (whether because of a merger, consolidation, recapitalization, reclassification, split, reverse split, combination of shares, other distribution of Shares without the receipt of consideration by the Company or otherwise, but not including a Public Offering or other capital infusion from any source) or if the number of Shares is increased through the payment of a dividend, then the Committee shall substitute for or add to each Share that may become subject to an Award the number and kind of shares or other securities into which each such Share was changed, for which each such Share was exchanged or to which each such Share is entitled, as the case may be.

Article 5. Eligibility and Participation

5.1 Eligibility. Any Employee, Director or Consultant is eligible to receive Awards under this Plan.

5.2 Actual Participation. The Committee will determine, within the limits set forth below, those Employees, Directors or Consultants to whom it will grant Awards. Each Employee, Director or Consultant selected by the Committee to receive an Award will become a Participant in the Plan upon execution of an Option Agreement.

Article 6. Stock Options

6.1 Grant of Options. Subject to the terms and provisions of the Plan, the Committee may grant Options to any Employee, Director or Advisor, in the number, and upon the terms, and at any time and from time to time, as the Committee determines and sets forth in an Option Agreement.

6.2 Option Agreement. Each Option grant will be evidenced by an Option Agreement that specifies the duration of the Option, the number of Shares to which the Option pertains, the manner, time, and rate of exercise and/or vesting of the Option, and such other provisions as the Committee determines.

6.3 Exercise Price. Each Option grant and Option Agreement will specify the Exercise Price for each Share subject to an Option. The per Share exercise price for Shares to be issued pursuant to the exercise of an Option shall be no less than the Fair Market value per Share on the date the Option is granted .

6.4 Duration of Options. Each Option will expire at the time determined by the Committee at the time of grant and specified in the Option Agreement, but no later than the tenth anniversary of the date of its grant.

6.5 Exercise of Options. Options will become vested and exercisable at such times and be subject to such restrictions and conditions as the Committee in each instance approves and sets forth in each Option Agreement.

6.6 Payment. The holder of an Option may exercise the Option only by delivering a written notice of exercise to the Company setting forth the number of Shares as to which the Option is to be exercised, together with full payment of the Exercise Price for the Shares as to which the Option is exercised and any withholding tax relating to the exercise of the Option.

The Exercise Price and any related withholding tax will be payable to the Company in full either: (i) in United States dollars, in cash or by check, bank draft, or money order payable to the order of the Company; (ii) with Shares owned by the Participant with a Fair Market Value equal to the Exercise Price and any related withholding tax being duly endorsed for transfer to the Company free and clear of any encumbrance; (iii) through a simultaneous exercise of the Participant’s Award and sale of the Shares thereby acquired pursuant to a brokerage arrangement approved in advance by the Committee to assure its conformity with the terms and conditions of the Plan; (iv) any combination of cash, check, Shares and/or, simultaneous exercise meeting the requirements of (i) through (iii) above; or (v) by any other means the Committee determines to be consistent with the Plan’s purposes and applicable law.

6.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Owned Shares as it deems necessary or advisable, including, without limitation, restrictions under applicable federal securities laws, under the requirements of any stock exchange or market upon which the Shares are then listed and/or traded, and under any blue sky or state securities laws applicable to the Shares.

6.8 Termination of Service.

(a) Each Option Agreement will set forth the extent to which the Participant has the right to exercise the Option after his or her termination of Service. These terms will be determined by the Committee in its discretion and may reflect, among other things, distinctions based on the reasons for termination of Service.

(b) Unless sooner terminated as provided in this Plan, in the event of the termination of a Participant’s Service with the Company and any Affiliate for any reason other than death or Disability of the Participant, such Participant may, within thirty (30) days (or such longer period of time as may be provided in the Option Agreement) from the date of such termination (but in no event later than the expiration date of the term of such Option) exercise such option to the extent vested and exercisable.

(c) Unless sooner terminated as provided in this Plan, in the event of the Disability or death of a Participant while employed or engaged by the Company or any Affiliate, Options held by such Participant that are vested and exercisable as of the date of Disability or death shall be exercisable for a period of six (6) months (or such longer period of time as may be provided in the Option Agreement) from the date of the Participant’s Disability or death, as applicable.

(d) In the event of the termination of a Participant’s Service with the Company and any Affiliates for Cause, all Options held by such Participant shall terminate as of the date of such termination.

(e) Options may be terminated at any time by agreement between the Company and the Participant.

6.9 Nontransferability of Options. Except as otherwise provided in a Participant’s Option Agreement, no Option granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Option Agreement, all Options will be exercisable during the Participant’s lifetime only by the Participant or his or her guardian or legal representative. The Committee may, in its discretion, require a Participant’s guardian or legal representative to supply it with the evidence the Committee deems necessary to establish the authority of the guardian or legal representative to act on behalf of the Participant.

6.10 Legend. Each certificate evidencing Owned Shares and each certificate issued in exchange for or upon the transfer of any Owned Shares will be stamped or otherwise imprinted with such legend as the Committee requires.

6.11 Financial Information. The Committee shall distribute financial statements at least annually to any Participants who live in California and who are not key employees whose duties in connection with the issuer assure them to access to equivalent information.

6.12 Incentive Stock Options . Notwithstanding any other provision of this Article 6 , the following special provisions shall apply to any award of Incentive Stock Options:

	(a)	The Board may award Incentive Stock Options only to Employees.

	(b)	An Option will not constitute an ISO under the Plan to the extent it would cause the aggregate Fair Market Value of Shares with respect to which ISOs are exercisable by the Participant for the first time during a calendar year (under all plans of the Company and its Affiliates) to exceed $100,000. Such Fair Market Value shall be determined as of the date on which each such ISO is granted.

	(c)	If the Employee to whom an ISO is granted owns stock possessing more than ten (10%) percent of the total combined voting power of all classes of stock of the Company or any of its Affiliates, then: (i) the Exercise Price for each Share subject to the ISO will be at least one hundred ten percent (110%) of the Fair Market Value of a Share on the date of grant; and (ii) the ISO will expire upon the earlier of (A) the time specified by the Board in the Award Agreement, or (B) the fifth anniversary of the date of grant.

	(d)	No Option that is intended to be an ISO may be granted under the Plan until the Company’s stockholders approve the Plan. If such stockholder approval is not obtained within 12 months after the Board’s adoption of the Plan, then no Options may be granted under the Plan that are intended to be ISOs. No Option that is intended to be an ISO may be granted under the Plan after the tenth anniversary of the date Geospatial adopted the Prior Plan or Geospatials stockholders approved the Prior Plan, whichever is earlier.

	(e)	An ISO must be exercised, if at all, by the earliest of (i) the time specified in the Award Agreement, (ii) three months after the Participant’s termination of Service for a reason other than death or Disability, or (iii) 12 months after the Participant’s termination of Service for death or Disability.

	(f)	The Participant must notify the Company of any disposition of any Shares issued pursuant to the exercise of an ISO under the circumstances described in Code Section 421(b) (relating to certain disqualifying dispositions) (any such circumstance, a “Disqualifying Disposition”), within 10 days of such Disqualifying Disposition.

	(g)	An Option that is intended but fails to be an ISO shall be treated as an NQSO for purposes of the Plan.

Article 7. Change in Control

Notwithstanding anything to the contrary set forth in this Plan, in the event of a Change in Control, the Board shall have the right, in its sole discretion, to accelerate the vesting and exercisability of all Options that are not vested and exercisable as of the date of the Change of Control and/or establish an earlier date for the expiration of the exercise of an Option (notwithstanding a later expiration of exercisability set forth in an Option Agreement). In addition, in the event of a Change in Control, the Board shall have the right, in its sole discretion: (i) to arrange for the successor company (or other entity) to assume all of the rights and obligations of the Company under this Plan, or (ii) to terminate this Plan and any outstanding Options and (A) to pay to all Participants cash with respect to such Options that are vested (or that become vested) as of the date of the Change in Control in an amount equal to the difference between the Exercise Price of each such Option and the Fair Market Value of a Share (determined as of the date the Plan is terminated) multiplied by the number of Options that are vested (or that become vested) as of the date of the Change of Control, or (B) to arrange for the exchange of all Options for options to purchase common stock in the successor corporation, or (C) to distribute to each Participant other property in an amount equal to and in the same form as the Participant would have received from the successor corporation if the Participant had owned the Shares subject to the Option at the time of the Change in Control. The form of payment or distribution to the Participant pursuant to this Section shall be determined by the Board in its sole discretion. If the Change in Control is structured as a (i) merger or consolidation, the Participant shall waive any dissenters rights, appraisal rights or similar rights in connection with such merger or consolidation or (ii) sale of Shares, each Participant will agree to sell all of his or her Owned Shares and vested Options on the terms and conditions approved by the Committee and comparable to the terms applicable to the beneficial owners of the Company’s outstanding voting stock. All Participants will take all actions the Committee considers necessary or desirable in connection with the consummation of the Change in Control.

Article 8. Breach of Restrictive Covenants

An Option Agreement may provide that, notwithstanding any other provision of this Plan to the contrary, if the Participant breaches the provisions of the Option Agreement with respect to non-competition or nonsolicitation of customers, suppliers, licensees, licensors or other business relations, whether during or after termination of Service, the Participant will forfeit and/or repay to the Company:

(a) any and all Awards granted or transferred to him or her under the Plan, including Awards that have become vested and exercisable; and

(b) the profit the Participant has realized on the exercise of any Options, which is the difference between (i) the Exercise Price of the Options the Participant exercised after terminating Service and within the six (6) month period immediately preceding the Participant’s termination of Service and (ii) the applicable Fair Market Value of the Shares purchased under such Options.

Article 9. Rights of Participants

(a) Nothing in the Plan will interfere with or limit in any way the right of any of the Company Parties to terminate any Participant’s Service at any time, or confer upon any Participant any right to continue in the Service of any of the Company Parties.

(b) A Participant shall have no rights as a Stockholder with respect to Shares covered by an Award until the date the Participant or his nominee, guardian, or legal representative is the holder of record of the Shares.

Article 10. Amendment, Modification and Termination

10.1 The Board may at any time and from time to time, alter, amend, modify or terminate the Plan in whole or in part. Subject to the terms and conditions of the Plan, the Board may modify, extend or renew outstanding Awards under the Plan, or accept the surrender of outstanding Awards (to the extent not already exercised) and grant new Awards in substitution of them (to the extent not already exercised). Notwithstanding the foregoing, no modification of an Award will, without the prior written consent of the Participant, materially and adversely alter or impair any rights or obligations under any Award already granted under the Plan.

10.2 Adjustment of Awards Upon the Occurrence of Certain Events.

(a) Equity Restructurings . If the outstanding Shares are increased, decreased, changed into or exchanged for a different number or kind of shares or other securities of the Company through a non-reciprocal transaction, such as a reorganization, distribution or other similar transaction, between the Company and its Stockholders that causes the per Share fair value underlying an Award to change, a proportionate adjustment shall be made to the number or kind of Shares or other securities allocated to Awards that have been granted prior to any such change. Any such adjustment in an outstanding Option shall be made without change in the aggregate Exercise Price applicable to the unexercised portion of such Option but with a corresponding adjustment in the Exercise Price for each Share or other security covered by such Option.

(b) Reciprocal Transactions . The Committee may, but shall not be obligated to, make an appropriate and proportionate adjustment to an Award or to the Exercise Price of any outstanding Option, and/or grant an additional Award to the holder of any outstanding Award, to compensate for the diminution in the intrinsic value of the Shares resulting from any reciprocal transaction, such as a merger or other similar transaction.

(c) Certain Unusual or Nonrecurring Events . In recognition of unusual or nonrecurring events affecting the Company or its financial statements, or in recognition of changes in applicable laws, regulations, or accounting principles, and, whenever the Committee determines that adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, the Committee may, using reasonable care, make adjustments in the terms and conditions of, and the criteria included in, Awards.

(d) Fractional Shares and Notice . Fractional Shares resulting from any adjustment in Awards pursuant to this Section 10.2 may be settled in cash or otherwise as the Committee determines. The Company will give notice of any adjustment to each Participant who holds an Award that has been adjusted and the adjustment (whether or not such notice is given) will be effective and binding for all Plan purposes.

Article 11. Withholding

11.1 Tax Withholding. The Company will have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount (either in cash or Shares) sufficient to satisfy federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising under this Plan.

11.2 Share Withholding. With respect to withholding required upon the exercise of Options, or upon any other taxable event arising as a result of Awards granted hereunder, the Company may satisfy the minimum withholding requirement for supplemental wages, in whole or in part, by withholding Shares having a Fair Market Value, determined as of (i) the last day of the calendar month ending on or immediately preceding the date the Participant recognizes taxable income on the Award, or (ii) the end of the Company’s most recently concluded Fiscal Year, whichever date produces the lower Fair Market Value figure, equal to the minimum amount of withholding tax required to be collected on the transaction. The Participant may elect to deliver the necessary funds to satisfy the withholding obligation to the Company, in which case there will be no reduction in the Shares otherwise distributable to the Participant.

Article 12. Successors

All obligations of the Company under the Plan or any Option Agreement will be binding on any successor to the Company, whether the existence of the successor results from a direct or indirect purchase of all or substantially all of the Company’s shares, or a merger, consolidation, or otherwise.

Article 13. Legal Construction

13.1 Number. Except where otherwise indicated by the context, any plural term used in this Plan includes the singular and a singular term includes the plural.

13.2 Severability. If any provision of the Plan is held illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and enforced as if the illegal or invalid provision had not been included.

13.3 Requirements of Law. The granting of Awards and the issuance of Share and/or cash payouts under the Plan will be subject to all applicable laws, rules, and regulations, and to any approvals by governmental agencies or national securities exchanges as may be required.

13.4 Securities Law Compliance. As to any individual who is, on the relevant date, an officer, director or ten percent (10%) beneficial owner of any class of the Company’s equity securities that is registered pursuant to Section 12 of the Exchange Act, all as defined under Section 16 of the Exchange Act, transactions under this Plan are intended to comply with all applicable conditions of Rule 16b-3 under the Exchange Act, or any successor rule. To the extent any provision of the Plan or action by the Board or Committee fails to so comply, it will be deemed null and void, to the extent permitted by law and deemed advisable by the Board.

13.5 Unfunded Status of the Plan. The Plan is intended to constitute an “unfunded” plan for incentive compensation. With respect to any payments or deliveries of Shares not yet made to a Participant by the Company, the Participant’s rights are no greater than those of a general creditor of the Company. The Committee may authorize the establishment of trusts or other arrangements to meet the obligations created under the Plan, so long as the arrangement does not cause the Plan to lose its legal status as an unfunded plan.

13.6 Limitation of Liability. Notwithstanding anything herein to the contrary, no member of the Board or the Committee shall be liable for any good faith determination, act or failure to act in connection with the Plan or any Award hereunder, and the Board and the members of the Committee shall be entitled to indemnification and reimbursement in the manner provided in the Company’s Certificate of Incorporation, By-Laws by agreement or otherwise as may be amended from time to time.

13.7 Awards to Foreign Nationals and Employees Outside the United States. To the extent the Committee deems it necessary, appropriate or desirable to comply with foreign law or practice and to further the purposes of this Plan, the Committee may, without amending the Plan, (i) establish rules applicable to Awards granted to Participants who are foreign nationals, are employed outside the United States, or both, including rules that differ from those set forth in this Plan, and (ii) grant Awards to such Participants in accordance with those rules that would require the application of the law of any other jurisdiction.

13.8 Governing Law. To the extent not preempted by federal law, the Plan and all agreements hereunder will be construed and enforced in accordance with, and governed by, the laws of the State of Delaware, without giving effect to its conflicts of laws principles that would require the application of the law of any other jurisdiction.

Geospatial Corporation S-1

Exhibit 10.4

EMPLOYMENT AGREEMENT

BETWEEN

MARK A. SMITH

AND

GEOSPATIAL MAPPING SYSTEMS, INC.

EMPLOYMENT AGREEMENT

THIS AGREEMENT (“Agreement”), by and between GEOSPATIAL MAPPING SYSTEMS, INC., a Delaware corporation (the “Company”), and Mark A. Smith (the “Executive”) is entered into as of December 1, 2007 (the “Employment Date”). In consideration of the mutual covenants set forth herein, the Company and the Executive hereby agree as follows:

1. Employment. The Company hereby agrees to employ the Executive, and the Executive agrees to continue to serve the Company, in the capacities described in Section 3 of this Agreement, during the Period of Employment (as defined in Section 2 of this Agreement), in accordance with the terms and conditions of this Agreement.

2. Period of Employment. The term “Period of Employment” shall mean the period which commenced on the Employment Date and, unless earlier terminated pursuant to Section 6, ends on November 30, 2010; provided, however, that beginning on December 1, 2010, the Period of Employment shall automatically be extended on a day-by-day basis from and after such date shall always be twelve (12) months unless either the Company or the Executive shall have terminated this automatic extension provision by giving written notice to the other.

3. Duties During the Period of Employment

3.1 Duties. During the Period of Employment, the Executive shall be employed as the Chairman, President and Chief Executive Officer of the Company with overall charge and responsibility for the business and affairs of the Company. The Executive shall report directly to the Company’s Board of Directors (the “Board”) and shall perform such duties as the Executive shall reasonably be directed to perform by the Board. The Company shall make all reasonable efforts to cause the Executive to continue to be elected to the Board throughout the Period of Employment.

3.2 Scope. Throughout the Period of Employment, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive shall devote substantially all of his business time and attention to the business and affairs of the Company. It shall not be a violation of this Agreement for the Executive to (a) serve on corporate, civic or charitable boards or committees, (b) deliver lectures, fulfill speaking engagements or teach occasional courses or seminars at educational institutions, or (c) manage personal investments and engage in any other activities, so long as such activities under clauses (a), (b) and (c) do not interfere, in any significant respect, with the Executive’s responsibilities hereunder or otherwise violate this Agreement or the Agreement Not to Compete executed and delivered by the Executive pursuant to the provisions of Section 12.

4. Compensation and Other Payments.

4.1 Salary. During the Period of Employment, the Executive’s Base Salary shall initially be at the rate of Three Hundred Twenty Thousand Dollars ($320,000) per year (the “Base Salary” ). The Executive’s Base Salary shall be paid in accordance with the Company’s standard payroll practice. The Base Salary shall be reviewed by the Company’s Board of Directors or a committee of directors established by the Board of Directors having responsibility for compensation matters (in either case, the “Board” ) as soon as practicable after the end of each fiscal year during the Period of Employment. Based upon such reviews, the Board may increase, but shall not decrease, the Base Salary. Any increase in Base Salary shall not serve to limit or reduce any other obligation of the Company under this Agreement.

4.2 Annual Bonuses.

4.2.1 Beginning with the Company’s fiscal year commencing on January 1, 2007 (the “Initial Year” ), the Executive shall participate in each annual and long-term incentive compensation plan established by the Board for executive officers of the Company (“Executive Compensation Plans”). For the Initial Year, the Executive’s target bonus award opportunity as a percentage of Base Salary (“Target Bonus Amount”) in the Company’s annual incentive compensation plan (the “Annual Bonus Plan” ) shall be set at 100% of Executive’s Base Salary. The performance measures applicable to the Executive’s bonus opportunity for each fiscal year of the Company during the Period of Employment shall be set by reasonable, good faith agreement of the Board and the Executive.

4.2.2 As soon as practicable after the end of the Initial Year and each fiscal year thereafter during the Period of Employment, the Board shall review the Executive’s performance under this Agreement as part of the Executive’s participation in the Executive Compensation Plans as in effect from time to time. The performance measures and the Target Bonus Amount applicable to the Executive’s bonus opportunity for each fiscal year of the Company during the Period of Employment shall be established by the Board, subject to Section 4.6 below. The Executive shall be paid his annual bonus, if any, no later than the date on which other senior executives of the Company are paid their annual bonuses. The Board may, in its discretion, award the Executive bonuses in addition to those provided under any plans referred to above.

4.3 Stock Options. The Company hereby grants to the Executive a ten (10) year stock option award with respect to eight million (8,000,000) shares of common stock of the Company at an exercise price of fifty cents ($0.50) per share. This option award (a) is a non-qualified option granted under the 2007 Stock Option Plan of the Company dated December 1, 2007, (b) shall be fully vested and exercisable immediately upon grant, and (c) shall be further documented by an option agreement in the form customarily used by the Company for non-qualified option awards under that plan, but with all terms consistent with this Agreement.

4.4 Other Compensation. During the Period of Employment, the Executive shall be entitled to participate, at a level and on a basis commensurate with the Executive’s position and responsibilities, in any and all supplemental compensation plans or arrangements established by the Company for its senior executives, including but not limited to any equity-based incentive compensation plans or arrangements.

4.5 Payment of Professional Fees. The Company shall pay all invoices rendered to the Company by the Executive’s attorneys, accountants and other advisors for reasonable fees and expenses in connection with the negotiation and preparation of this Agreement; provided, however, that the Company’s obligation pursuant to this Section 4.5 shall not exceed $25,000 incurred by Executive.

5. Other Executive Benefits.

5.1 Business Expenses. Subject to the Executive’s compliance with the policies and procedures approved by the Board and applicable to all senior executives of the Company, the Company shall promptly reimburse the Executive for all expenses and disbursements reasonably incurred by the Executive in the performance of his duties hereunder during the Period of Employment.

5.2 Benefit Plans. The Executive and his eligible family members shall be entitled, subject to any normally applicable waiting periods and eligibility criteria, to participate, on terms no less favorable to the Executive than the terms offered to other senior executives of the Company, in any group and/or executive life, hospitalization or disability insurance plan, health program, pension, profit sharing, 401(k) and similar benefit plans (qualified, non-qualified and supplemental) or other fringe benefits (it being understood that items such as stock options and other equity awards are not fringe benefits) of the Company (collectively referred to as the “Benefits” ). Anything contained herein to the contrary notwithstanding, the Benefits described herein shall not duplicate benefits made available to the Executive pursuant to any other provision of this Agreement.

5.3 Holidays and Vacation. During the Period of Employment, the Executive shall be entitled to the same paid holidays as other employees of the Company. The Executive shall be entitled to paid vacation and other absences from work that are reasonably consistent with the performance of the Executive’s duties as provided in this Agreement. Such vacations and absences shall be consistent with those generally provided to other senior executives of the Company.

5.4 Company Automobile. During the Period of Employment, the Executive shall have the use of an automobile provided by the Company in accordance with a policy approved by the Board; provided, however, that no change adverse to the Executive may be made in that policy without the written consent of the Executive.

5.5 Facilities and Support. During the Period of Employment, the Company shall provide the Executive with office space, furnishings and facilities, secretarial and administrative assistance, supplies and equipment appropriate to enable the Executive to perform his duties under this Agreement and commensurate, in quality and quantity, with the facilities and support resources provided to the other senior executives of the Company.

5.6 Tax and Financial Planning Services. During the Period of Employment, the Company shall pay (or reimburse the Executive) for the cost of personal tax and financial planning services and related expenses in an amount up to fifteen thousand dollars ($15,000.00) per year.

6. Termination.

6.1 Death. The Period of Employment shall terminate automatically upon the Executive’s death.

6.2 Disability. If the Company determines in good faith that the Disability of the Executive has occurred (pursuant to the definition of “Disability” set forth below), it may give to the Executive written notice of its intention to terminate the Executive’s employment. In such event, the Period of Employment shall terminate effective on the 30th day after receipt by the Executive of such written notice given at any time after a period of 120 consecutive days of Disability or a period of 180 days of Disability within any 12 consecutive months, and, in either case, while such Disability is continuing (“Disability Effective Date”) . The Disability Effective Date shall not occur if the Executive returns to performance of the Executive’s duties as contemplated in this Agreement within 30 days after receipt of such notice. For purposes of this Agreement, “Disability” means the Executive’s inability to substantially perform his duties hereunder, with reasonable accommodation, as evidenced by a certificate signed either by a physician mutually acceptable to the Company and the Executive or, if the Company and the Executive cannot agree upon a physician, by a physician selected by agreement of a physician designated by the Company and a physician designated by the Executive; provided, however, that if such physicians cannot agree upon a third physician within 30 days, such third physician shall be designated by the American Arbitration Association. Until the Disability Effective Date, the Executive shall be entitled to all compensation and benefits provided for under Sections 4 and 5 hereof. It is understood that nothing in this Section 6.2 shall serve to limit the Company’s obligations under Section 7.3, below.

6.3 By the Company for Cause. During the Period of Employment, the Company may terminate the Executive’s employment immediately for “Cause.” For purposes of this Agreement, “Cause” means (a) a material breach of this Agreement by the Executive or the gross neglect of the Executive’s duties hereunder (after the provision to the Executive by the Company of written notice reasonably specifying the breach and/or performance deficiency and thirty (30) days to cure such breach), (b) the Executive’s willful misconduct or gross negligence, which is demonstrably and materially injurious to the Company monetarily or otherwise, or (c) the Executive’s engaging in egregious misconduct involving serious moral turpitude to the extent that the Executive’s credibility and reputation no longer conforms to the standards of employees of the Company employed in a similar level or position. For purposes of this definition, no act or failure to act on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interest of the Company. Any act, or failure to act, based upon direction given in a resolution duly adopted by the Board or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interest of the Company. The foregoing notwithstanding, the Company may not terminate the Executive’s employment for Cause, and any purported termination by the Company of Executive’s employment shall be presumed other than for Cause, unless (i) a determination that Cause exists is made and approved by at least a 3/4ths majority of the Board, (ii) the Executive is given at least seven (7) days written notice of the Board meeting called to make such determination, including written notice of the particulars purporting to establish Cause and (iii) the Executive and his legal counsel are given the opportunity to address that meeting.

6.4 By Executive for Good Reason. During the Period of Employment, the Executive’s employment hereunder may be terminated by the Executive for Good Reason upon (30) days’ written notice. For purposes of this Agreement, “Good Reason” means, without the Executive’s written consent, (a) any material breach of this Agreement by the Company (after the provision to the Company by the Executive of written notice reasonably specifying the breach and/or performance deficiency and thirty (30) days to cure such breach), (b) the assignment to the Executive of duties that are inconsistent with those of the Chairman, President and Chief Executive Officer of the Company or that materially impairs the Executive’s ability to perform his duties, or any other action by the Company that results in a significant diminution in the Executive’s position, authority, duties or responsibilities, to include without limitation the failure of Executive to be named or elected to the Board (after the provision to the Company by the Executive of written notice reasonably specifying the basis upon which the Executive believes this clause has been violated and thirty (30) days to modify such assignment or change in position), (c) any relocation of the Executive’s office as assigned to him by the Company to a location more than fifty (20) miles from Natrona Heights, Pennsylvania; (d) delivery by the Company of a notice discontinuing the automatic extension provision of Section 2 of this Agreement; or (e) any termination by the Executive during the period of six (6) months immediately following the occurrence of a Change of Control, as defined in Section 8, below.

6.5 Other than for Cause or Good Reason. The Executive or the Company may terminate this Agreement for any reason other than for Good Reason or Cause, respectively, upon 30 days’ written notice to the Company or the Executive, as the case may be.

6.6 Notice of Termination. Any termination by the Company or by the Executive shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 18.2 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (a) indicates the specific termination provision in this Agreement relied upon, (b) sets forth in reasonable detail, if applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (c) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the Date of Termination. The failure by the Executive or Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of the basis for termination shall not waive any right of such party hereunder or preclude such party from asserting such fact or circumstance in enforcing his or its rights hereunder.

6.7 Date of Termination. “Date of Termination” means the date specified in the Notice of Termination; provided, however, that if the Executive’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be.

7. Obligations of the Company Upon Termination. The following provisions of this Section 7 describe the entire obligations of the Company to the Executive upon termination of his employment under this Agreement.

7.1 Termination by the Company for Cause or by Executive’s Resignation without Good Reason. In the event the Period of Employment terminates by reason of the termination of the Executive’s employment by the Company for Cause, or by reason of the resignation of the Executive other than for Good Reason, the Company shall pay to the Executive all Accrued Obligations. “Accrued Obligations” shall mean, as of the Date of Termination, the sum of (a) the Executive’s Base Salary through the Date of Termination to the extent not theretofore paid, (b) the amount of any bonus, incentive compensation, deferred compensation and other cash compensation earned by the Executive as of the Date of Termination to the extent not theretofore paid, and (c) any vacation pay, expense reimbursements and other cash entitlements earned by the Executive as of the Date of Termination to the extent not theretofore paid.

7.2 Death. If the Period of Employment is terminated by death, the Executive’s beneficiaries shall be paid the Accrued Obligations. In addition, all equity awards granted to the Executive by the Company that have not yet vested shall fully vest on the Date of Termination; and all vested options (whether previously vested or vesting under this sentence) shall remain exercisable for a period equal to their full original terms.

7.3 Disability. If the Period of Employment is terminated because of Disability, the Executive shall be paid the Accrued Obligations. In addition, all equity awards granted to the Executive by the Company that have not yet vested shall fully vest on the Date of Termination; and all vested options (whether previously vested or vesting under this sentence) shall remain exercisable for a period equal to their full original terms.

7.4 Retirement. If the Executive voluntarily terminates his employment with the Company with or without Good Reason at any time after the Executive reaches the age of fifty-five (55) years, he shall, in addition to receiving payment of the Accrued Obligations, be treated as a retiree for purposes of all compensation and benefit plans, policies, arrangements and practices of the Company then in effect. In addition, all equity awards granted to the Executive by the Company that have not yet vested shall fully vest on the Date of Termination; and all vested options (whether previously vested or vesting under this sentence) shall remain exercisable for a period equal to their full original terms.

7.5 Resignation with Good Reason or Termination without Cause. If the Company terminates the Executive’s employment other than for Cause (and other than due to the Executive’s Disability), or if the Executive terminates his employment for Good Reason, the Executive shall receive, in addition to payment of the Accrued Obligations, the following:

7.5.1 A lump sum cash payment in an amount equal to the number of months remaining in the Period of Employment multiplied by the sum of (a) 1/12 ^th of the Executive’s annual Base Salary on the Date of Termination (without regard to any reduction in Base Salary not approved by the Executive) and (b) 1/12 ^th of the annual bonus award to which the Executive would have been entitled calculated using the Target Bonus Amount for the year in which the Notice of Termination is given;

7.5.2 Immediate vesting in all equity awards granted to the Executive by the Company but not yet vested as of the Date of Termination;

7.53 Continued exercisability, for a period equal to their full original terms, for all vested options, whether previously vested or vesting under subsection 7.5.2;

7.5.4 For a period of 12 months after the Date of Termination, the Company shall continue health, prescription drug, dental, disability and life insurance benefits to the Executive and/or the Executive’s eligible family members at least equal to those which would have been provided to them in accordance with Section 5.2 of this Agreement if the Executive’s employment had not been terminated (provided that any benefits provided under this subsection 7.5.4 are subject to immediate early termination if the Executive becomes eligible to receive similar types of benefits through subsequent employment).

7.6 Release. Any and all compensation and benefits payable pursuant to Section 7.5, above, beyond payments of the Accrued Obligations shall be payable only if the Executive delivers to the Company a general release, in a form reasonably prescribed by the Company, of all claims of the Executive arising up to the date of the release; and such release shall be delivered by the Executive within twenty-one (21) days after presentation thereof to the Executive by the Company.

7.7 Exclusive Rights. It is understood that the Executive’s rights under this Section 7 are in lieu of all other rights which the Executive may otherwise have had upon termination of employment under this Agreement.

7.8 No Right of Set-Off. The Company shall have no right to reduce, because of any debt or financial obligation of the Executive to the Company, the amount of any compensation or benefit otherwise payable by the Company to the Executive under this Agreement or under any other plan, policy, arrangement or practice of the Company.

8. Change in Control. For purposes of this Agreement, a “Change in Control” shall be deemed to have occurred if:

8.1 Change in Ownership. Any “person” (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 19434, as amended (the “Exchange Act”)), excluding for this purpose, (a) the Executive, (b) the Company or any subsidiary of the Company, or (c) any employee benefit plan of the Company or of any subsidiary of the Company, or any person or entity organized, appointed or established by the Company for or pursuant to the terms of any such plan which acquires beneficial ownership of voting securities of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act). Directly or indirectly of securities of the Company representing more than thirty percent (30%) of the combined voting power of the Company’s then outstanding securities; provided, however, that no Change of Control will be deemed to have occurred as a result of a change in ownership percentage resulting from an acquisition of securities by the Company; or

8.2 Change in Board. During any twenty-four (24) consecutive months, individuals who at the beginning of such twenty four (24) month period constitute the Board of Directors of the Company and any new directors (except for any director designated by a person who has entered into an agreement with the Company to effect a transaction described elsewhere in this definition of Change of Control) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved (such individuals and any such new directors being referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; or

8.3 Business Combination. Consummation of a reorganization, merger or consolidation, or sale or disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, more than fifty-five percent (55%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity resulting from such Business Combination (including, without limitation, an entity which, as a result of such transaction, owns the Company or all or substantially al of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company; or

8.4 Liquidation. Consummation of a complete liquidation or dissolution of the Company.

9. Taxes. In the event that the aggregate of all payments or benefits made or provided to, or that may be made or provided to, the Executive under this Agreement and under all other plans, programs and arrangements of the Company (the “Aggregate Payment”) is determined to constitute an “excess parachute payment,” as such term is defined in Section 280G(b) of the Internal Revenue Code, the Company shall pay to the Executive prior to the time any excise tax imposed by Section 4999 of the Internal Revenue Code (“Excise Tax”) is payable with respect to such Aggregate Payment, an additional amount which, after the imposition of all income and excise taxes thereon, is equal to the Excise Tax on the Aggregate Payment. The determination of whether the Aggregate Payment constitutes an excess parachute payment and, if so, the amount to be provided to the Executive and the time of payment pursuant to this Section 8 shall be made by an independent auditor (the “Auditor”) jointly selected by the Company and the Executive and paid by the Company. The Auditor shall be a nationally recognized United States public accounting firm which has not, during the two (2) years immediately preceding the date of its selection, acted in any way on behalf of the Company or any affiliate thereof. If the Executive and the Company cannot agree on the firm to serve as the Auditor, then the Executive and the Company shall each select one accounting firm and those two firms shall jointly select the accounting firm to serve as the Auditor. Notwithstanding the foregoing, in the event that the amount of the Executive’s Excise Tax liability is subsequently determined to be greater than the Excise Tax liability with respect to which any initial payment to the Executive under this Section 8 has been made, the Company shall pay to the Executive an additional amount (grossed up for all taxes), with respect to such additional Excise Tax (and any interest and penalties thereon) at the time and in the amount reasonably determined by the Auditor. Similarly, if the amount of the Executive’s Excise Tax liability is subsequently determined to be less than the Excise Tax liability with respect to which any prior payment to the Executive has been made under this Section 8, the Executive shall refund to the Company the excess amount received, after reduction for any nonrefundable tax, penalties and/or interest incurred by the Executive in connection with the receipt of such excess, and such refund shall be paid promptly after the Executive has received any corresponding refund of excess Excise Tax paid to the Internal Revenue Service. The Executive and the Company shall cooperate with each other in connection with any proceeding or claim relating to the existence or amount of liability for Excise Tax, and all expenses incurred by the Executive in connection therewith shall be paid by the Company promptly upon notice of demand from the Executive.

10. Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement. Except as otherwise set forth herein with respect to health, prescription drug, dental, disability and life insurance benefits, any severance benefits payable to the Executive shall not be subject to reduction for any compensation received from other employment.

11. Indemnification. The Executive shall be indemnified by the Company against liability as an officer and director of the Company and any subsidiary or affiliate of the Company to the maximum extent permitted by applicable law. To the full extent permitted under the corporate governing documents of the Company, and subject to the terms of any policies and procedures applicable to all directors and senior officers of the Company, the Company shall advance to the Executive payment of reasonable costs of defending against any claims covered by the foregoing indemnification commitment The Executive’s rights under this Section 10 shall continue so long as he may be subject to such liability, whether or not this Agreement may have terminated prior thereto.

12. Confidential Information and Trade Secrets. As a condition to the Company’s obligations hereunder, the Executive shall execute and deliver to the Company an Agreement Not to Compete in the form attached as Exhibit A to this Agreement. The Company hereby acknowledges receipt of an Agreement Not to Compete executed by the Executive.

13. Withholding. Anything in this Agreement to the contrary notwithstanding, all payments required to be made by the Company hereunder to the Executive shall be subject to withholding at the time payments are actually made to the Executive and received by him of such amounts relating to taxes as the Company may reasonably determine it should withhold pursuant to any applicable law or regulation. In lieu of withholding such amounts, in whole or in part, the Company may, in its sole discretion, accept other provision for payment of taxes as required by law, provided that it is satisfied that all requirements of law as to its responsibilities to withhold such taxes have been satisfied.

14. Arbitration. Any dispute or controversy between the Company and the Executive arising out of or relating to this Agreement, other than a dispute arising out of or related to the Non-Disclosure of Confidential Information and Trade Secrets Agreement, shall be settled by arbitration conducted under the rules of (but not necessarily administered by) the American Arbitration Association (“AAA”) in accordance with its National Rules for the Resolution of Employment Disputes then in effect, and judgment on any award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Any arbitration shall be held before a single arbitrator who shall be selected by the agreement of the Company and the Executive, unless the parties are unable to agree to an arbitrator, in which case the arbitrator will be selected under the procedures of the AAA. The arbitrator shall have the authority to award any remedy or relief that a court of competent jurisdiction could order or grant, including, without limitation, the issuance of an injunction. Either party may, without inconsistency with this arbitration provision, apply to any court having jurisdiction over the parties and seek interim provisional, injunctive or other interim equitable relief until the arbitration award is rendered or the controversy is otherwise resolved. Except as necessary in court proceedings to enforce this arbitration provision or an award rendered hereunder, or to obtain interim relief, neither a party nor an arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of the Company and the Executive. The Company and the Executive acknowledge that this Agreement evidences a transaction involving interstate commerce. Notwithstanding any choice of law provision included in this Agreement, the United States Federal Arbitration Act shall govern the interpretation and enforcement of this arbitration provision. The arbitration proceeding shall be conducted in Pittsburgh, Pennsylvania or such other location to which the parties may agree. The Company shall pay the costs of any arbitrator appointed hereunder.

15. Disputes; Payment of Attorneys’ Fees. In the event that the Executive is the prevailing party, or is successful to a material degree, in pursuing or defending, whether in arbitration or litigation, any claim or dispute relating to the Executive’s employment with the Company, including but not limited to any claim or dispute relating to (a) this Agreement, (b) termination of the Executive’s employment with the Company or (c) the failure or refusal of the Company or the Executive to perform fully in accordance with the terms hereof, the Company shall promptly reimburse the Executive for all reasonable costs and expenses (including, but not limited to, attorneys’ fees) relating solely, or reasonably allocable, to such claim or dispute. In any other case, the Executive and the Company shall each bear all of their own costs and expenses (including, but not limited to, attorneys’ fees). Upon written request from the Executive while any claim or dispute described in the first sentence of this Section 14 is pending, the Company shall promptly reimburse the Executive for all reasonable costs and expenses relating to such claim or dispute; provided that the Executive agrees in writing that he will repay the Company in full for such reimbursement if he is not ultimately successful to a material degree with respect to the substance of such claim or dispute. In addition, the Company shall promptly reimburse the Executive for all reasonable costs and expenses (including, but not limited to, attorneys’ fees) incurred by the Executive in preparing responses to Internal Revenue Service (“IRS”) audits of the Executive’s personal income tax returns or otherwise defending such tax returns in any administrative proceeding or civil litigation relating thereto that is occasioned by or connected with an audit by the IRS of one or more income tax returns of the Company. The provisions of this Section 15 shall survive the expiration or termination of this Agreement and the Period of Employment.

16. Successors.

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

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

16.3 As used in this Agreement, the term “Company” shall include any successor to the Company’s business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

17. Representations.

17.1 The Company represents and warrants that (a) the execution of this Agreement has been duly authorized by the Company, including action of the Board, (b) the execution, delivery and performance of this Agreement by the Company does not and will not violate any law, regulation, order, judgment or decree or any agreement, plan or corporate governance document of the Company, and (c) upon the execution and delivery of this Agreement by the Executive, this Agreement shall be the valid and binding obligation of the Company, enforceable in accordance with its terms, except to the extent enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by the effect of general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

17.2 The Executive represents and warrants to the Company that (a) the execution, delivery and performance of this Agreement by the Executive does not and will not violate any law, regulation, order, judgment or decree or any agreement to which the Executive is a party or by which he is bound, (b) the Executive is not a party to or bound by any employment agreement, noncompetition agreement or confidentiality agreement with any person or entity that would interfere with this Agreement or his performance of services hereunder, (c) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive, enforceable in accordance with its terms, except to the extent enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by the effect of general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

18. Miscellaneous.

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

18.2 All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed to have been duly given or made the second business day after the date of mailing, if delivered by registered or certified mail, postage prepaid; upon delivery, if sent by hand delivery; upon delivery, if sent by prepaid courier, with a record of receipt; or the next day after the date of dispatch, if sent by cable, telegram, facsimile or telecopy (with a copy simultaneously sent by registered or certified mail, postage prepaid, return receipt requested), to the parties at the following addresses:

if to the Executive, to:

Mark A. Smith

1001 Carlisle Street

Natrona Heights, PA 15065

Telephone: 724-226-2067

if to Company, to:

Geospatial Mapping Systems, Inc.

229 Howes Run Road

Sarver, PA 16055

Attention: General Counsel

Facsimile: 724-353-3049

Telephone: 724-353-3400

Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.

18.3 None of the provisions of this Agreement shall be deemed to impose a penalty.

18.4 The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

18.5 Any party’s failure to insist upon strict compliance with any provision hereof shall not be deemed to be a waiver of such provision or any other provision hereof.

18.6 This Agreement supersedes any and all prior communications, understandings, and agreements, written or oral, between the Company and the Executive with respect to the subject matter hereof, and contains the entire understanding of the Company and the Executive with respect to the subject matter hereof. In the event of any inconsistency between this Agreement and any plan, policy, arrangement or practice of the Company, the relevant provision of this Agreement shall control.

18.7 This Agreement may be executed simultaneously in two (2) or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.


	GEOSPATIAL MAPPING SYTEMS, INC.

	By:
	Its:		PRESIDENT

	MARK A. SMITH

Geospatial Corporation S-1

Exhibit 10.5

EXECUTION COPY

G EOSPATIAL M APPING S YSTEMS , I NC .

2007 S TOCK OPTION P LAN

N ONQUALIFIED S TOCK O PTION A GREEMENT

This O PTION A WARD A GREEMENT ( “Agreement” ) is dated effective December 1, 2007 (the “Grant Date” ), and is between Geospatial Mapping Systems, Inc., a Delaware corporation (the “Company” ), and Mark A. Smith (the “Participant ”). Any term capitalized but not defined in this Agreement will have the meaning set forth in the Geospatial Mapping Systems, Inc. 2007 Stock Option Plan (the “Plan” ).

1. Option Grant . In accordance with the terms of the Plan and subject to the terms and conditions of this Agreement, the Company hereby grants to the Participant an option to purchase all or any part of an aggregate of Eight Million (8,000,000) of the Company’s Shares (the “Option” ). The Participant may exercise this Option only after it has become vested in accordance with the provisions of Section 4 . This Option is a nonqualified option that is not intended to meet the requirements of Code Section 422.

2. Exercise Price . The Exercise Price will be $0.50 per Share, which is no less than the Fair Market Value of a Share on the Grant Date.

3. Payment of Exercise Price . At the time the Option is exercised, the Participant must pay the Exercise Price to the Company in full either: (i) in United States dollars, in cash or by check, bank draft, or money order payable to the order of the Company; (ii) with Shares owned by the Participant with a Fair Market Value equal to the Exercise Price being duly endorsed for transfer to the Company free and clear of any encumbrance; (iii) through a simultaneous exercise of the Participant’s Award and sale of the shares thereby acquired pursuant to a brokerage arrangement approved in advance by the Committee to assure its conformity with the terms and conditions of the Plan; (iv) any combination of cash, check, Shares and/or, with the prior consent of the Committee, which consent may be refused for any reason, vested Options meeting the requirements of (i) through (iii) above; or (v) by any other means the Committee determines to be consistent with the Plan’s purposes and applicable law.

(a) Upon the Participant’s exercise of the Option, the Participant must satisfy any withholding obligation by paying the amount of any required withholding tax to the Company. If the Participant does not pay the amount of required withholding to the Company, the Company will withhold from the Shares delivered or from other amounts payable to the Participant, the minimum amount of funds required to cover all applicable federal, state and local income and employment taxes required to be withheld by the Company by reason of such exercise of the Option.

(b) Shares used to satisfy the Exercise Price and/or any required withholding tax (including Shares underlying surrendered Options) will be valued at their Fair Market Value, determined according to the Plan, as of (i) the last day of the calendar month ending on or immediately preceding the date of the Participant’s exercise, or (ii) the end of the Company’s most recently concluded Fiscal Year, whichever date produces the lower Fair Market Value figure.

(c) The Company will issue no Shares pursuant to the Option before the Participant has: (i) paid the Exercise Price, and any withholding obligation, in full; (ii) executed any applicable Shareholder Agreement; and (iii) satisfied all conditions and/or restrictions applicable to the Options or Shares.

4. Term, Vesting and Exercise of the Option .

(a) The Option will expire on the tenth anniversary of the Grant Date (the “Expiration Date” ).

(b) The Options shall be fully vested and exercisable on the Grant Date.

(c) After the Option has vested, and while it is exercisable, the Participant may exercise the Option in whole or in part by signed written notice to the Company indicating the number of Shares being purchased. An Option must be exercised as to a whole number of Shares.

5. Termination of Service . After termination of Service, the Participant’s right to exercise the Option will be subject to the following rules:

(a) Unvested Option Forfeited . The Participant will forfeit the Option to the extent that it was not vested and exercisable on the date his or her Service terminated, regardless of the reason for such termination.

(b) Disability or Death . If the Participant’s Service terminates as a result of Disability or death, the Participant (or in the case of his or her death, the Participant’s estate) may exercise the Option to the extent that it was vested and exercisable on the date of such termination of Service within the six-month period following such termination of Service.

(d) Other Termination of Service . If the Participant’s Service terminates for any reason other than Cause, Disability or death, the Participant may exercise the Option to the extent that it was vested and exercisable on the date of such termination of Service within the sixty-day period following such termination of Service.

(e) In no event may the Option be exercised after the Expiration Date.

6. Termination of Service for Cause . Notwithstanding anything in this Agreement to the contrary, if the Participant has been terminated from Service for Cause, the Participant will forfeit his or her right to exercise the Option, whether or not it has already vested and become exercisable.

7. Confidentiality, Competition, and Nonsolicitation . Participant has entered into an Agreement Not-To-Compete dated December 1, 2007.

8. Transferability of Option and Shares Acquired Upon Exercise of Option . The Participant may not sell, transfer, pledge, assign or otherwise alienate or hypothecate the Option, other than by will or by the laws of descent and distribution. The Company will not be required (i) to transfer on its books any Options or Shares that have been sold or transferred, or (ii) to treat as owner of such Options or Shares, to accord the right to vote as such owner or to pay dividends, if any, to any transferee to whom such Options or Shares have been transferred, in violation of the Plan, this Agreement, or any shareholders agreement.

(a) During the Participant’s lifetime, only the Participant or his or her guardian or legal representative may exercise the Option. The Board may, in its discretion, require a guardian or legal representative to supply it with the evidence the Board reasonably deems necessary to establish the authority of the guardian or legal representative to exercise the Option on behalf of the Participant or transferee, as the case may be.

(b) Prior to the consummation of a Public Offering, in no event may a Participant sell, transfer or otherwise dispose of an Owned Share without the Board’s advanced written approval.

9. Securities Law Requirements .

(a) If at any time the Board determines that exercising the Option or issuing Shares would violate applicable securities laws, the Option will not be exercisable, and the Company will not be required to issue Shares. The Board may declare any provision of this Agreement or action of its own null and void, if it determines the provision or action fails to comply with the short-swing trading rules. As a condition to exercise, the Company may require the Participant to make written representations it deems necessary or desirable to comply with applicable securities laws.

(b) No Person who acquires Shares under this Agreement may sell the Shares, unless they make the offer and sale pursuant to an effective registration statement under the Securities Exchange Act, which is current and includes the Shares to be sold, or an exemption from the registration requirements of that Act.

10. No Obligation to Exercise Option . Neither the Participant nor his or her transferee is or will be obligated by the grant of the Option to exercise it.

11. No Limitation on Rights of the Company . The grant of the Option does not and will not in any way affect the right or power of the Company to make adjustments, reclassifications or changes in its capital or business structure, or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part of its business or assets.

12. Plan and Agreement Not a Contract of Employment or Service . Neither the Plan nor this Agreement is a contract of employment or Service, and no terms of the Participant’s employment or Service will be affected in any way by the Plan, this Agreement or related instruments, except to the extent specifically expressed therein. Neither the Plan nor this Agreement will be construed as conferring any legal rights on the Participant to continue to be employed or remain in Service with any Company Party, nor will it interfere with the Company’s or any Company Party’s right to discharge the Participant or to deal with him or her regardless of the existence of the Plan, this Agreement or the Option.

13. Participant to Have No Rights as a Shareholder . Before the date as of which he or she is recorded on the books of the Company as the holder of any Shares underlying the Option, the Participant will have no rights as a shareholder with respect to those Shares.

14. Notice . Any notice or other communication required or permitted under this Agreement must be in writing and must be delivered personally, sent by certified, registered or express mail, or sent by overnight courier, at the sender’s expense. Notice will be deemed given when delivered personally or, if mailed, three days after the date of deposit in the United States mail or, if sent by overnight courier, on the regular business day following the date sent. Notice to the Company should be sent to Geospatial Mapping Systems, Inc. [INSERT ADDRESS]. Notice to the Participant should be sent to the address set forth on the signature page below. Either party may change the Person and/or address to whom the other party must give notice under this Section by giving such other party written notice of such change, in accordance with the procedures described above.

15. Successors . All obligations of the Company under this Agreement will be binding on any successor to the Company, whether the existence of the successor results from a direct or indirect purchase of all or substantially all of the business of the Company, or a merger, consolidation, or otherwise.

16. Governing Law . To the extent not preempted by federal law, this Agreement will be construed and enforced in accordance with, and governed by, the laws of the State of Delaware, without giving effect to its conflicts of laws principles that would require the application of the law of any other jurisdiction; provided, however, that in the event the Company’s state of incorporation shall be changed, then the law of the new state of incorporation shall govern.

17. Plan Document Controls . The rights granted under this Agreement are in all respects subject to the provisions set forth in the Plan to the same extent and with the same effect as if set forth fully in this Agreement. If the terms of this Agreement conflict with the terms of the Plan document, the Plan document will control.

18. Amendment of the Agreement . The Company and the Participant may amend this Agreement only by a written instrument signed by both parties.

19. Counterparts . The parties may execute this Agreement in one or more counterparts, all of which together shall constitute but one Agreement.

[signature page follows]

IN WITNESS WHEREOF, the Company and the Participant have duly executed this Agreement as of the date first written above.


GEOSPATIAL MAPPING SYSTEMS, INC.

			/s/ Mark A. Smith
			(Participant’s Signature)

By:	/s/ Mark A. Smith
	Its:	President	Participant’s Name and Address for notices

			Mark A. Smith

			1001 Carlisle St.

			Natrona Heights, PA 15065

O PTION E XERCISE F ORM

The undersigned holder of an option to purchase shares of Geospatial Mapping Systems, Inc. pursuant to a Stock Option Award Agreement under the Geospatial Mapping Systems, Inc. 2007 Stock Option Plan, effective [ ], 2007, hereby exercises his/her Option to purchase of such shares, at the Option price of $ . per share, in accordance with the terms and conditions of such Option Award Agreement.

I hereby agree to be bound by all of the provisions of, and to execute any applicable Shareholder Agreement or related document required by the Company.


Date of Exercise




				Signature of Person Exercising Option

Please type or print legibly your name, as you want it to appear on your stock certificate, your address and your social security number in the space provided below.


Name:

Address:


	(Street)


(City)	(State)	(Zip Code)


Social Security Number:

Geospatial Corporation S-1

Exhibit 10.6

EXECUTION COPY

AGREEMENT NOT-TO-COMPETE

This Agreement Not-To-Compete (the “Agreement”) is made and entered into as of December 1, 2007, by and between Geospatial Mapping Systems, Inc., a Delaware corporation (the “Company”) and Mark A. Smith (the “Employee”). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Employment Agreement dated as of even date herewith between the Company and the Employee (the “Employment Agreement”).

WHEREAS, the Employee is employed by the Company;

WHEREAS, in the course of the Employee’s employment, the Employee will obtain extensive knowledge of and experience in the business conducted by the Company;

WHEREAS, the Employee will enjoy extensive high level contacts with customers and prospective customers of the Company and will have access to confidential and proprietary information of the Company;

WHEREAS, the Company has entered into the Employment Agreement with the Employee in consideration for the Employee entering into this Agreement;

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties agree as follows:

1. Confidential Information .

(a) The Employee acknowledges that (i) during employment by, and as a result of the Employee’s relationship with, the Company, the Employee will obtain knowledge of and gain access to information regarding the business, operations, products, proposed products, production methods, processes, customer lists, advertising, marketing and promotional plans and materials, price lists, pricing policies, financial information and other trade secrets of the Company, other confidential information of, and material proprietary to, the Company or designated as being confidential by the Company which is not generally known to persons outside of the Company, including information and material originated, discovered or developed in whole or in part by the Employee (collectively referred to herein as “Confidential Information”), (ii) the direct and indirect disclosure of any such Confidential Information to existing or potential competitors of the Company would place the Company at a competitive disadvantage and would do damage, monetary or otherwise, to the business of the Company; and (iii) the engaging by the Employee in any of the activities prohibited by this Section 1 may constitute improper appropriation and/or use of such information and trade secrets. The Employee expressly acknowledges the trade secret status of the Confidential Information and that the Confidential Information constitutes a protectable business interest of one or more members of the Company. Accordingly, the Employee agrees that during the Period of Employment with the Company (or any member thereof) and, to the fullest extent permitted by law, thereafter, the Employee will, in a fiduciary capacity for the benefit of the Company, hold all Confidential Information strictly in confidence and will not directly or indirectly reveal, report, disclose, publish or transfer any of such Confidential Information to any person, firm or other entity, or utilize any of the Confidential Information for any purpose, except in furtherance of the Employee’s employment with the Company or with any member of the Company or as may be required by law.

(b) Proprietary Interest . All inventions, designs, improvements, patents, copyrights and discoveries conceived by the Employee during the Period of Employment that are useful in or directly or indirectly related to the business of any member of the Company, or to any experimental work carried on by any member of the Company, shall be the property of the Company. The Employee will promptly and fully disclose to the Company all such inventions, designs, improvements, patents, copyrights and discoveries (whether developed individually or with other persons) and shall take all steps necessary and reasonably required to assure the Company’s ownership thereof and to assist the Company in protecting or defending proprietary rights therein of the Company and/or the appropriate member of the Company.

(c) Return of Materials . The Employee expressly acknowledges that all lists, books, records and other Confidential Information of the Company obtained in connection with the business of any member of the Company is the exclusive property of the Company and the appropriate member of the Company and that upon the termination of the Period of Employment, or earlier if so requested by the Company, the Employee will immediately surrender and return to the Company all such items and all other property belonging to any member of the Company then in the possession of the Employee, and the Employee shall not make or retain any copies thereof.

2. Noncompetition and Nonsolicitation .

(a) The Employee agrees that during the Period of Employment and for a period of twelve full months following the Date of Termination (the “Non-Compete Period”), the Employee will not, directly or indirectly, individually or otherwise, engage in a business competing with any of the businesses conducted by any member of the Company any where in the United States, nor without the prior written consent of the Board directly or indirectly have any interest in, own, manage, operate, control, be connected with as a stockholder, joint venturer, lender, officer, employee, partner or consultant, or otherwise engage, invest or participate in any business that is competitive with any of the businesses conducted by any member of the Company; provided, however, that nothing contained in this Section 2(a) shall prevent the Employee from being the registered or beneficial owner of up to 2% of any class of the capital stock of a corporation registered under the Securities Exchange Act of 1934, as amended. The Employee further agrees that during the Non-Compete Period the Employee will not, in any manner, directly or indirectly, for the Employee’s benefit or for the benefit of any other person, firm or entity, (1) induce or attempt to induce any employee of any member of the Company to terminate or abandon his or her employment with any such member for any purpose whatsoever, (2) solicit from any customer doing business with any member of the Company during the Non-Compete Period, business of the same or similar nature to the business of any member of the Company with such customer, or (3) otherwise interfere with the business or accounts of any member of the Company.

(b) As consideration for the Employee’s agreement to the provisions of Sections 1 and 2(a), the Company has entered into the Employment Agreement with Employee.

3. Injunctive Relief . The Employee acknowledges that a breach of the covenants contained in Section 1 or Section 2 hereof shall cause irreparable damage to the Company, the exact amount of which shall be difficult to ascertain, and that the remedies at law for any such breach shall be inadequate. Accordingly, the Employee agrees that, notwithstanding any provision of the Employment Agreement to the contrary, if the Employee breaches any of the covenants contained in Section 1 or Section 2 hereof, then the Company shall be entitled to injunctive relief in addition to any other remedy or remedies available to the Company at law or in equity.

4. Notices . All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed to have been duly given or made the second business day after the date of mailing, if delivered by registered or certified mail, postage prepaid; upon delivery, if sent by hand delivery; upon delivery, if sent by prepaid courier, with a record of receipt; or the next day after the date of dispatch, if sent by cable, telegram, facsimile or telecopy (with a copy simultaneously sent by registered or certified mail, postage prepaid, return receipt requested), to the parties at the following addresses:


	if to the Executive, to:

	Mark A. Smith 1001 Carlisle Street Natrona Heights, PA 15065 Telephone: 724-226-2067

	if to Company, to:

	Geospatial Mapping Systems, Inc. 229 Howes Run Road Sarver, PA 16055 Attention: General Counsel Facsimile: 724-353-3049 Telephone: 724-353-3400

Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.

5. Entire Agreement . This Agreement, together with the Employment Agreement, constitutes the entire agreement between the parties and supersedes all prior written and oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This Agreement may not be changed orally, but only by an agreement in writing signed by both parties.

6. Counterparts . This Agreement may be executed in counterparts, each of which shall be an original, but all of which together shall constitute one agreement.

7. Governing Law and Construction . This Agreement shall be governed under and construed in accordance with the laws of the state of Pennsylvania, without regard to the principles of conflicts of laws. The paragraph headings and captions contained herein are for reference purposes and convenience only and shall not in any way affect the meaning or interpretation of this Agreement. It is intended by the parties that this Agreement be interpreted in accordance with its fair and simple meaning, not for or against either party, and neither party shall be deemed to be the drafter of this Agreement.

8. Severability . If any portion or provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, the remaining portions or provisions hereof shall not be affected. The covenants in this Agreement are severable and separate, and the unenforceability of any specific covenant shall not affect the enforceability of any other covenant. Moreover, in the event that any court of competent jurisdiction shall determine that the scope, time or territorial restrictions set forth are unreasonable, then it is the intention of the parties that such restrictions be enforced to the fullest extent that the court deems reasonable, and this Agreement shall thereby be reformed.

9. Binding Effect . The rights and obligations of the parties under this Agreement shall be binding upon and inure to the benefit of the permitted successors, assigns, heirs, administrators, executors and personal representatives of the parties.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and in the year first written above.


	COMPANY:

	GEOSPATIAL MAPPING SYSTEMS, INC.


	By:		MARK A. SMITH
	Its:		PRESIDENT

	MARK A. SMITH

Geospatial Corporation S-1

EXHIBIT 10.7

CONVERSION AGREEMENT

This Conversion Agreement (" Agreement ") is made and entered into as of August, 20, 2013, by and among Geospatial Holdings, Inc., a Nevada corporation (the " Company "), Geospatial Mapping Systems, Inc., a Delaware corporation and a wholly owned subsidiary of the Company (" GMS ") and Mark A. Smith, Chairman and Chief Executive Officer of the Company (" Smith ").

RECITALS

WHEREAS, Smith holds the following notes evidencing the Company ' s obligation to repay certain loans made by Smith to the Company: (i) an unsecured convertible note dated October 30, 2009 in the original principal amount of One Million Dollars ($1,000,000 (the " Convertible Note" ) and (ii) an unsecured demand note dated October 30, 2009 in the original principal amount of $128 , 262.70 (the "Demand Note"); and

WHEREAS, the total principal and accrued interest owed by the Company as of August 1, 2013 (the " Effective Date ") (i) under the Convertible Note is $40,638.l 0 (the "Convertible Note Amount") and (ii) under the Demand Note is $173,011.45 (the "Demand Note Amount"); and

WHEREAS, subsequent to the issuance of the Convertible Note and the Demand Note, Smith made additional loans to the Company in the amount of $140,000, which Joans together with accrued and unpaid interest thereon, aggregate $184,203.78 as of August 1, 2013 (the " Additional Loan Amount "); and

WHEREAS, GMS and Smith entered into a Lease Agreement dated May 1, 2006 (the "Lease Agreement") pursuant to which Smith leased an office to the Company; and

WHEREAS, from December 1 , 2009 to June 30, 2012, Smith incurred expenses and made disbursements in the course of performing his duties for the Company, which have not been reimbursed to Smith by the Company and Smith was not paid rent by GMS as required by the terms of the Lease Agreement , all of which unreimbursed and unpaid amounts aggregate $282,156.20 (the " Unpaid Expense Amount "); and

WHEREAS, from July 1 , 2012 through the Effective Date, Smith has incurred expenses and made disbursements in the course of performing his duties for the Company, which has not been reimbursed to Smith by the Company and Smith was not paid rent by GMS as required by the terms of the Lease Agreement, all of which unreimbursed and unpaid amounts aggregate $21,366.40 (the " Recent Unpaid Expense Amount ") ; and

WHEREAS , GMS has not paid to Smith his Base Salary as provided for in the Employment Agreement dated as of December 1 , 2007 between GMS and Smith (the "Employment Agreement") , and such unpaid Base Salary aggregated (a) $57 3 , 634.70 for the period prior to and including June 3 0 , 2 012 (the " Unpaid Salary Amount " ) and (b) $9 7 , 500.00 for the period from July 1 , 2012 through the Effective Date ( the " Recent Unpaid Salary Amount "); and

WHEREAS, the Compan y and GMS desire that Smith exchange (i) the principal and interest owed to him pursuant to the Convertible Note and the Demand Note , (ii) the Add i tional Loan Amount, (iii) the Unpaid Expense Amount and (iv) the Unpaid Salary Amount for shares of common stock , par value $.001 per share , of the Company (" Common Stock ") and a warrant to purchase shares of Common Stock of the Company; and

WHEREAS, the Company and Smith desire to memorialize the Recent Unpaid Expense Amount and the Recent Unpaid Salary Amount , and agree upon the terms of their pa y ment ; and

WHEREAS, the Company desires to grant certain registration rights to Smith .

NOW THEREFORE, for go o d and valuable consideratio n , the receipt and sufficiency of which is hereby acknowledged, the Company, GMS and Smith hereby agrees as follows :

AGREEMENT

1 .

CONVERSION AND RELEASE.

1.1 Conversion into Common Stock and Warrant. Upon the terms and subject to the conditions of this Agreement , Smith hereby delivers and surrenders to the Company the Convertible Note and th e Demand Note , and surrenders and releases to the Company his right to receive payment of the Additional Loan Amount , the Unpaid Expense Amount and the Unpaid Salary Amount, and in exchange therefor , the Company hereby issues and delivers to Smith (a) 17,909,203 shares of Common Stock (the " Co nversion Stock ") and (b) a warrant to purchase 1 , 790,920 shares of Common Stock in the form of Exhibit A hereto (the " Warrant ").

1.2 Release. Smith hereby accepts the Conversion Stock and the Warrant in full payment and satisfaction of the Convertible Note Amount, the Demand Note Amount, the Additional Loan Amount , the Unpaid Expense Amount and the Unpaid Salary Amount, and releases and discharges the Company, GMS and all of their respective employees , agents , successors, assigns , affiliates , directors and officers from and against any and all other obligations or liabilities relating to the Convertible Note , the Demand Note , the Additional Loan Amount, the Unpaid Expense Amount and the Unpaid Salary Amount. Notwithstanding anything in this Agreement to the contrary , nothing contained herein is intended to , and this Agreement shall not operate to, release any claims Smith may have to enforce any rights conferred under this Agreement.

1.3 Payment of Taxes . To the extent that the issuance of the Conversion Stock and the Warrant to Smith would be subject to taxes imposed against Smith under the Internal Revenue Code of 1986 , as amende d , the Federal Insurance Contributions Act , as amended, and any state or local tax code or regulation, if applicable (collectively, the "Tax es") , then Smith shall be entitled to receive a payment from the Company (the "Gross-Up Payment " ) in an amount such that after payment by Smith of all federal, state and local taxes (including income taxes and excise taxes) imposed on the Gross-Up Payment, Smith retains an amount of the Gross-Up Payment equal to the Taxes.

1.4 Repayment of Recent Unpaid Expense Amount and Recent Unpaid Salary A mou nt. The Company hereby acknowledges its obligation and liability to pay the Recent Unpaid Expense Amount and the Recent Unpaid Salary Amount to Smith and agrees to use its reasonable commercial efforts to pay such amounts to Smith as soon as possible.

1.5 Registration Rights. Concurrently with the execution and delivery of this Agreement, the Company and Smith are entering into a Registration Rights Agreement in the form of Exhibit B hereto (the " Registration Rights Agreement ").

2 .

REPRESENTATIONS AND WARRANTIES OF THE COMPANY . The Company hereby represents and warrants to Smith that as of the Effective Date:

2.1 Organization . The Company is duly organized, validly existing and in good s tanding under the laws of the State of Nevada. The Company has full power and authority to own or lease its properties and to carry on its business as pre s ently conducted.

2.2 Due Authorization and Valid Issuance. The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreem e nt , the Warrant and the Registration Rights Agreement. This Agreement, the Warrant and the Registration Rights Agreement have been duly authorized and validly executed and delivered by the Company and each constitutes the 1ega1, valid and binding agreement of the Company enforceable against the Company in accordance with its terms, except as (a) rights to indemnity and contribution may be limited by state or federal securities Jaws of the public policy underlying such laws, (b) enforceability may be limited by applicable bankruptcy , insolvency , reorganization , moratorium or similar laws affecting creditors' rights and contracting parties' rights generally and (c) enforceability may be subject to general principles of equity (regardless of whether such enforceability is con s idered in a proceeding in equity or at law).

2.3 Capitalization . Immediately prior to giving effect to the transactions contemplated by this Agreement , the authorized capital stock of the Company consists of (i) 100 , 000,000 shares of common stock, par value $ . 001 per share, of which 4 5 , 871 , 374 shares are issued and outstanding , and (ii) 5 , 000,000 shares of preferred stock, par value $ . 001 per share, 5,000 , 000 of which are designated as "Series B Convertible Preferred Stock" , of which 4,460,429 are issued and outstanding. As of the date hereof, 15,000,000 shares of common stock are reserved for issuance upon exercise of stock options granted or to be granted under the Company's Stock Incentive Plans . As of the date hereof there are outstanding warrants to purchase 5,942,242 shares of common stock and outstanding warrants to purchase 446,023 shares of Series B Convertible Preferred Stock.

2.4 Issuance of Shares . The shares of Convers i on Stock, when issued , sold and delivered in accordance with the terms of this Agreement, and the shares of Common Stock issuable pursuant to the Warrant, when issued , sold and delivered in accordance with the terms of the Warrant, will be duly authorized , validly issued, fully-paid and nonassesable.

2.5 Private Offering . Assuming the correctness of the representations and warranties of Smith set forth in Section 3 hereof, the issuance of the Conversion Stock and the Warrant is exempt from registration under the Securities Act of 1933 , as amended , and the rules and regulations promulgated thereunder (the "Securities Act") . Neither the Company nor any person acting on behalf of the Company has offered or sold the Conversion Stock or the Warrant by any form of general solicitation or general advertising.

3 .

REPRESENTATIONS AND WARRANTIES OF SMITH . The Company hereby represents and warrants to Smith that as of the Effective Date:

3.1 Authorization . Smith has the requisite legal power and authority to enter into this Agreement and this Agreement constitutes a valid and legally binding obligation of Smith, except as the same may be limited by bankruptcy , insolvency, moratorium or other laws of general application affecting the enforcement of creditors' rights .

3.2 Conversion Stock and Warrant Not Registered ; Reliance Upon Smith's Representations . Smith understands and acknowledges (i) that the Conversion Stock and the Warrant are not registered or qualified under any federal, foreign or state securities laws , (ii) that the Conversion Stock and the Warrant are being issued to Smith on the ground that the issuance of securities hereunder is exempt from regi s tration under all applicable securities laws pursuant to exemptions thereunder , and (iii) that the Company ' s reliance on such exemptions is predicated on Smith's representations set forth herein.

3.3 Accredited Investor . Smith is an " accredited investor" within the meaning of Rule 501 of Regulation D under the Securities Act, as presently in effect.

3.4 Restricted Securities . Smith understands that the Conversion Stock and the Warrant constitute restricted securities under applicable securities laws and may not be resold or transferred unless they are first registered on qualified under applicable securities laws or unless an exemption from such registration or qualification is available. Accordingly , Smith hereby acknowledges that he is prepared to hold the Conversion Stock and the Warrant for an indefinite period of time, until resale is permitted under applicable securities laws.

3.5 Experience; Risk . Smith has such knowledge and experience in financial and business matters that Smith is capable of evaluating the merits and risks of his acquisition of the Conversion Stock and the Warrant and of protecting Smith's interests in connection therewith . Smith is able to fend for himself in the trans a ctions contemplated by this Agreement and has the ability to bear the economic ri s k of the investment, including complete loss of the investment.

3.6 Investment . Smith is acquiring the Conversion Stock and the Warrant for investment for his own account , not as a nominee or agent and not with a view to , or for resale in connection with any distribution thereof, and Smith has no present intention of selling , granting any participation i n , or otherwise distributing the same.

4 .

RESTRICTED SECURITIES .

4.1 Restrictive Legends .

(a) Unless and until otherwise permitted by this Section, each certificate for Conversion Stock issued to Smith or any subsequent transferee of any such certificate shall be stamped or otherwise imprinted with a legend of substantially the following form:

" THE SHARES REPRESENTED BY THIS CERTIFICATE H A VE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1 9 33 OR ANY OTHER APPLICABLE FEDERAL OR STATE SECURITIES LAWS, AND THUS MAY NOT BE TRANSFERRED UNLESS REGISTERED UNDER THE SECURITIES ACT OR 1933 AND SUCH OTHER LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE . "

(b) In addition to the legend required by this Section 4 . 1 , each certificate for Company shares issued under or pursuant to this Agreement to Smith or any subsequent transferee shall be stamped or otherwise imprinted with any legend required pursuant to applicable state corporation and securities laws.

4.2 Transfer . The Company may decline to acknowledge or register a transfer of any Company shares bearing any legend pursuant to Section 4 . 1 , and may instruct any transfer agent for its Company shares to decline the same , unless the Company is reasonably satisfied that the Company shares being transferred have been registered or are exempt from registration under applicable securities law s .

4.3 Removal of Legends . Whenever the legend described in Sec tion 4.1 shall no longer be required by law , the holder of any particular Company shares bearing such legends shall be entitled to receive from the Company , without expense to s uch hold e r, one or more new certificates for such particular Company shares not bearing restrictive leg e nds pur s uant to Section 4.1 hereof.

MISCELLANEOUS .

5.1 Further Instruments and Actions . The parties agree to execute s uch further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.

5.2 Expenses. Each party hereto agrees to pay its expenses incurred in connection with this Agreement and the documents and transactions contemplated herein.

5.3 Notices . All notices and other communications requir e d or permitted hereunder s hall be giv e n in writing a nd shall be deli v ered by person a l deliver y , facsimil e, el e ctronic mail , o v ernight deli v ery service , or U . S . mail serv i ce , addr es sed as follows :

The Company : Geospatial Holdings , Inc. 229 Howes Run Road Sarver, PA 16055

Attn: Thomas Oxenreiter , Chief Financial Officer T: 724-353-3400

F : 724-353-3049

Emai l : toxenreiter @ ge o s p a tialcorporation . com

Smith :

Mark A. Smith 1001 Carlisle Str e et

Natrona H e ights , PA 15065 T : 724-994-8055

H: 724-226-2067

Email: mark @ g o o s el a k e ventures.com

Any notice or other communication delivered in accordance with this Sec tio n 5 shall be de e med to have been given upon actual receipt or refusal of such delivery.

5.4 Governing Law . This Agreement shall be governed in all respect s by the laws of the Commonwealth of Penn sy lvania without giving effect to the conflicts of laws principles hereof.

5.5 Successors and Assigns; Assignment . No part y ma y assign this Agreement or any rights or obligations h e reund e r without the prior written cons e nt of the oth e r party , which consent m a y not be unr e asonably withheld , including b y merger or consolidation. Subject to the preceding , this Agreement shall b e binding upon , inure to

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

COMPANY:		SMITH:

GEOSPATIAL HOLDINGS, INC.

By:	/s/ Thomas R. Oxenreiter	By:	/s/ Mark A. Smith
	Thomas R. Oxenreiter: CFO		Mark A. Smith

GMS:

GEOSPATIAL MAPPING SYSTEMS, INC.

By:	/s/ Thomas R. Oxenretier
	Thomas R. Oxenreiter: CFO

EXHIBIT A

FORM OF WARRANT

See Attached

NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED , OR ANY STATE SECURITIES LAWS. NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY BE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT , UNDER THE SECURITIES ACT OF 1933 , AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR (B) IN A TRANSACTION WHICH IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS .

Warrant Is s ue Date: August , 2013

COMMON STOCK PURCHASE WARRANT

For value received , Geospatial Holdings, Inc. (the "Company"), a Nevada corporation, hereby certifies that (the " Holder ") or its permitted assign(s) is entitled to purchase from the Company, at any time or from time to time during the Exercise Period (as defined below), in whole or in part, shares of the Company's Common Stock, par value $.001 per share (" Common Stock "), at a price per share equal to $0.25 (the " Exercise Price "). This Warrant is subject the following terms and conditions. This Warrant is issued pursuant to that certain Conversion Agreement dated as of August , 2013 , by and among the Company, Geospatial Mapping Systems, Inc. and the Holder (the " Conversion Agreement ") . This Warrant is s ubject to the terms of the Conversion Agreement and the following additional terms and conditions.

I . Certain Definitions.

(a) " Change in Control " means any sale of capital stock of the Company or consolidation or merger of the Company with or into an y other corporation or other entity or person , or any other corporate reorganization , in which the stockholders of the Company immediately prior to such sale, consolidation, merger or reorganization, do not hold at least a majority of the resulting or surviving corporation's voting power immediately after such consolidation, merger or reorganization, or the sale, lease, or other disposition of all or substantially all of the assets of the Company .

(b) " Exercise Period " means the period commencing on the Warrant Issue Date and ending on the date that is the earliest to occur of (i) 5 : 00 p.m. (prevailing local time at the principal executive office of the Company) on the fifth anniversary of the Warrant Issue Date, (ii) a Change in Control, or (iii) the closing of a Qualified Public Offering (as defined in the Certificate of Designation of Series B Preferred Stock of the Company).

Exercise of Warrant .

(a) The purchase rights represented by this Warrant are exercisable by the Holder, in whole or in part, during the Exercise Period by the surrender of this Warrant, with the form of Subscription Agreement attached hereto as Annex A duly completed and executed by the Holder, to the Company at its principal executive office, accompanied by payment in cash, in lawful money of the United States of America, including by certified or official bank check made payable to the order of the Company or by wire transfer of immediately available funds to an account designated by the Company , of an amount equal to the Exercise Price multiplied by the number of shares of Common Stock being purchased pursuant to such exercise of the Warrant.

(b) This Warrant may be exercised for less than the full number of shares of Common Stock first shown above, provided that this Warrant may not be exercised in part for less than a whole number of shares of Common Stock. Upon any such partial exercise, the Company at its expense will forthwith issue to the Holder a new Warrant or Warrants of like tenor exercisable for the number of shares of Common Stock as to which rights have not been exercised (subject to adjustment as herein provided), such Warrant or Warrants to be issued in the name of the Holder or its nominee.

(c) As soon as practicable after the exercise of this Warrant and payment of the Exercise Price, and in any event within 20 business days thereafter, the Company , at its expense, will cause to be issued in the name of and delivered to the Holder a certificate or certificates for the number of duly authorized, validly issued, fully paid and non-assessable shares of Common Stock to which the Holder shall be entitled upon such exercise, plus, in lieu of any fractional share to which the Holder would otherwise be entitled, cash in an amount determined in accordance with Section 3(d) hereof. The Company agrees that the shares so purchased shall be deemed to be issued to the Holder as the record owner of such shares as of the close of business on the date on which this Warrant shall have been surrendered and payment made for such shares as aforesaid .

(d) Prior to the exercise of this Warrant, the Holder shall not be entitled to any rights of a stockholder of the Company with respect to shares for which this Warrant shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company. ·

(e) In the event that the Company proposes to engage in a Change in Control or Qualified Public Offering, it shall give the Holder written of its intention not less than ten (10) days prior to the date of the proposed closing of such transaction. The notice shall describe the material terms and conditions upon which the Company proposes to consummate such transaction.

Adjustments .

(a) Adjustments Generally. In order to prevent dilution of the rights granted hereunder in the specific circumstances contemplated by this Section 3, the Exercise Price shall be subject to adjustment from time to time in accordance with this Section 3 . Upon each adjustment of the Exercise Price pursuant to this Section 3, the Holder shall thereafter be entitled to acquire upon exercise, at the Exercise Price resulting from such adjustment, the number of shares of Common Stock determined by (i) multiplying (A) the Exercise Price in effect immediately prior to such adjustment by (B) the number of shares of Common Stock issuable upon exercise hereof immediately prior to such adjustment, and (ii) dividing the product thereof by the Exercise Price resulting from such adjustment; provided that no such adjustments shall be made in the Exercise Price and/or the number of shares of Common Stock subject to this Warrant if the conversion ratio of the Common Stock already reflects such event.

(b) Subdivisions, Stock Dividends and Recapitalizations . In case the Company shall at any time subdivide its outstanding shares of Common Stock into a greater number of shares (including, without limitation, through any stock split effected by means of a dividend on the Common Stock which is payable in Common Stock), the Exercise Price in effect immediately prior to such subdivision shall be proportionately reduced, and , conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased, unless the conversion ratio of such Common Stock already reflects such event.

(c) Reorganization, Reclassification, Consolidation, Merger or Sale of Assets . If any capital reorganization or reclassification of the capital stock of the Company, or consolidation or merger of the Company with another corporation, or the sale of a significant amount of assets to another corporation shall be effected in such a way that (i) does not constitute a Change in Control, and (ii) holders of Common Stock shall be entitled to receive stock, securities, cash or other property with respect to or in exchange for Common Stock, then, as a condition of such reorganization, reclassification, consolidation, merger or sale, lawful and adequate provision shall be made whereby the Holder shall have the right to acquire and receive upon exercise of this Warrant such shares of stock, securities, cash or other property of the successor corporation that a holder of the shares deliverable upon exercise of this Warrant would have been entitled to receive in such reorganization, reclassification, consolidation, merger or sale if this Warrant had been exercised immediately before such reorganization, reclassification, consolidation, merger or sale. The foregoing provisions shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers or sales and to the stock or securities of any other corporation that are at the time receivable upon the exercise of this Warrant. In all events, appropriate adjustments (as determined by the Board of Directors of the Company) shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after the transaction, to the end that the provisions of this Warrant shall be applicable after that event, as near as reasonably may be , in relation to any shares or other property deliverable after that event upon exercise of this Warrant.

(d) Fractional Shares . The Company shall not issue fractions of s hares of Common Stock upon exercise of this Warrant or scrip in lieu thereof . If any fraction of a share of Common Stock would , except for the provisions of this Section 3(d), be issuable upon exercise of this Warrant, then the Company shall in lieu thereof pay to the person entitled thereto an amount in cash equal to the current value of such fraction, calculated to the nearest one-hundredth (11100) of a share, to be computed on the basis of the fair market value per share as determined in good faith by the Board of Directors of the Company .

( e) Certificate as to Adjustments . Whenever the Exercise Price shall be adjusted as provided in Section 3 hereof, the Company shall promptly compute such adjustment and furnish to the Holder a certificate setting forth such adjustment and showing in reasonable detail the facts requiring such adjustment, the Exercise Price that will be effective after such adjustment and the number of shares and the amount , if any , of other property that at the time would be received upon the exercise of this Warrant.

4. Reservation of Stock Issuable on Exercise of Warrants . The Company shall at all times reserve and keep available out of its authorized but unissued stock , solely for the issuance and delivery upon the exercise of this Warrant, such number of its duly authorized shares of Common Stock as from time to time shall be issuable upon the exercise of this Warrant. All of the shares of Common Stock issuable upon exercise of this Warrant, when issued and delivered in accordance with the terms hereof and thereof, will be duly authorized , validly issued , fully paid and non-assessable, subject to no lien or other encumbrance other than restrictions on transfer arising under applicable securities laws and restrictions imposed by Section 6(a) hereof and the Agreements to which reference is made in Section 6(b) hereof.

5. Replacement of Warrant . Upon receipt of evidence reasonably satisfactory to the Company of the loss , theft, destruction or mutilation of this Warrant and (in the case of loss , theft or destruction) upon delivery of an indemnity agreement reasonably satisfactory to the Company (with surety if reasonably required), or (in the case of mutilation) upon surrender and cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of like tenor and amount.

Negotiability . This Warrant is issued upon the following terms:

(a) Transfer . By acceptance hereof, the Holder acknowledges and agrees that the Holder is acquiring the Warrant and the shares of Common Stock issuable upon exercise hereof for investment for its own account , not as a nominee or agent , and not with a view to , or for resale in connection with, any distribution thereof, and Holder has no present intention of sellin g , granting any participation in , or otherwise distributing the same .

(b) Agreements . As a condition to the Company's obligation to issue shares of Common Stock upon exercise hereof, the Holder shall execute the Subscription Agreement attached hereto as Annex A .

(c) Transfer Taxes . The Company shall not be required to pay any federal or state transfer tax or charge that may be payable in respect of any transfer involved in the transfer or delivery of this Warrant or the issuance or conversion or delivery of certificates for Common Stock in a name other than that of the Holder or to issue or deliver any certificates for Common Stock upon the exercise of this Warrant until any and all such taxes and charges shall have been paid by the Holder or until it has been established to the Company's reasonable satisfaction that no such tax or charge is due.

(d) Compliance with Securities Laws . The Holder , by acceptance hereof , acknowledges that this Warrant and the shares of Common Stock to be issued upon exercise hereof are being acquired solely for the Holder's own account and not as a nominee for any other party , and for investment, and that the Holder will not offer, sell or otherwise dispose of this Warrant or any shares of Common Stock to be issued upon exercise hereof except under circumstances that will not result in a violation of applicable federal and state securities laws.

7. Subdivision of Rights . Subject to Section 6, this Warrant (as well as any new Warrants issued pursuant to the provisions of this Section 7) is exchangeable, upon the surrender hereof by the Holder , at the principal executive office of the Company for any number of new Warrants of like tenor and date representing in the aggregate the right to subscribe for and purchase the number of shares of Common Stock of the Company which may be subscribed for and purchased hereunder .

Miscellaneous.

(a) Notices . Any notice or other communication required or permitted to be given hereunder shall be in writing and given as provided in the Conversion Agreement .

(b) Books of the Company . The Company may treat the holder hereof as appearing on the Company's books at any time as the holder for all purposes.

(c) Headings . The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect the meaning hereof.

(d) Amendment; Waiver . This Warrant and any term hereof may be amended, waived, discharged or terminated only by an instrument in writing signed by the party against whom enforcement of such amendment, waiver, discharge or termination is sought. No waivers of any term, condition or provision of this Warrant , in any one or more instances , shall be deemed to be, or construed as, a further or continuing waiver of any such term , condition or provision.

(e) Benefits of this Warrant . Nothing in this Warrant shall be construed to give any person or corporation other than the Company and the Holder any legal or equitable right, remedy or claim under this Warrant and this Warrant shall be for the sole and exclusive benefit of the Company and the Holder and any other permitted holder or holders of the Warrant.

[ REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed and delivered by its authorized officer , as of the date first above written .

	Geospatial Holdings , Inc

	By:	/s/ Mark A. Smith
	Name:	Mark A. Smith
	Title:	Chief Executive Officer

ANNEX A

SUBSCRIPTION AGREEMENT

Date: _____________________

T o : _____________________

The undersigned (the " Purchaser "), pursuant to the provisions set forth in the attached Warrant , hereby irrevocably elects (a) to purchase shares of Common Stock (the " Warrant Shares ") covered by such Warrant and herewith makes payment of $ , representing the full purchase price for such shares at the price per share provided for in such Warrant or (b) to exercise the Warrant with respect to ________ shares of Common Stock, pursuant to Section 2(b) of the Warrant [STRIKE (a) OR (b) AS APPLICABLE] .

Purchaser represents and warrants to the Company as follows:

1. Investment Representations . Purchaser understands that the Warrant Shares have not been registered under the Securities Act. Purchaser also understands that the Warrant Shares are being offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon Purchaser's representations contained in this Agreement.

2. Experience; Risk. Purchaser has such knowledge and experience in financial and business matters that Purchaser is capable of evaluating the merits and risks of the purchase of the Warrant Shares and of protecting Purchaser' s interests in connection therewith. Purchaser is able to fend for itself in the transactions contemplated by this Agreement and has the ability to bear the economic risk of the investment , including complete loss of the investment.

3. Investment . Purchaser is acquiring the Warrant Shares for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distribution thereof, and Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same . Purchaser understands that the Warrant Shares have not been registered under the Securities Act and applicable state securities laws (collectively, the "Acts") by reason of a specific exemption from the registration provisions of the Acts which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of Purchaser's representations as expressed herein.

4. Information . Purchaser has been furnished with all information which it deems necessary to evaluate the merits and risks of purchasing the Warrant Shares and has had the opportunity to ask questions concerning the Warrant Shares and the Company and all questions posed have been answered to its satisfaction. Purchaser has been given the opportunity to obtain any additional information it deems neces sary to verify the accuracy of any information obtained concerning the Warrant Shares and the Company. Purchaser has such knowledge and experience in financial and business matters that it is able to evaluate the merits and risks of purchasing the Warrant Shares and to make an informed decision relating thereto.

5. Restricted Securities; Restrictions on Transfer. Purchaser understands that the Warrant Shares will be "restricted securities" under applicable securities laws inasmuch as they are being ac quired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations the Warrant Shares may be resold without registration under the Acts only in certain limited circumstances. Purchaser acknowledges that Warrant Shares must be held indefinitely unless subsequently registered under the Acts or an exemption from such registration is available . To the extent that Purchaser is no t already a party to such agreements, Purchaser agrees to execute and deliver a counterpart signature page, and become a party , to such s tockholder and registration rights agreements as are then in effect by and among the Company and its stockholders.

6. No Public Market . Purchaser understands that no public market now exists for any of the securities issued by the Company and that there is no assurance that a public market will ever exist for s uch securities .

7. Accredited Inve s tor. Purchaser is an "accredi t e d investor" within the meaning of Rule 501 promulgated under the Securities Act . Th e Purchaser has considered the Federal and state income tax implications of the exercise of the Warrant and the purchase and subsequent sale of the Warrant Shares .

8. Residence . If Purchaser is an individual , then Purchaser resides in the state or province identified in the address of Purchaser set forth below; if Purchaser is a partner sh ip , corporation, limited liability company or other entity , then the office or offices of Purchaser in which its investment decision was made is located at the address or addresses of Purchaser set forth below .


		Signature

		Print name:
		Address:

NOTICE OF TRANSFER

[To be signed only upon transfer of Warrant]

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the Assignee named below the rights and obligations represented by the within Warrant with respect to the number of shares of Common Stock of set forth below:

Name of Assignee

Address

No. of Shares

and appoints ____________________ attorney to transfer said right on the warrant register of ____________________ with full power of substitution in the premises.

Dated : ________________

(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)

Address:

_____________________________

EXHIBIT B

FORM OF REGISTRATION RIGHTS AGR E E M E NT

See Attached

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this " A greemen t " ) is entered into as of this _ _ day of August , 2013 (the " Effective Dat e " ) by and between Geospatial Holdings , In c . , a Nevada corporation ( th e " Company " ), and Mark A . Smit h , an individual resident of Natrona Heights, Pennsylvania ("Smith") .

AGREEMENT

WHEREAS , the Company , Geospat i al Mapping Systems, Inc . and Smith are parties to a Conversion Agreement dated the date hereof (the " Conversion Agreement" ); and

WHEREAS, the Con v ersion Agreement requires that, upon execution of the Conversion Agreement, Geospatial and Smith will enter into this Agr e ement.

NOW, THEREFORE , in consideration of the mutual covenants and agreements set forth herein and for good and valuabl e consideration , the receipt and adequacy of which is her e by acknowledged, the parties hereb y agre e as follows:

ARTICLE I DEFINITIONS

1 . 1 Definitions . As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

" Agreemen t " has the meaning set forth in the preamble . " Boar d " means the b o a r d o f directors of the Company.

Company .

" Common Stoc k " means th e common stock, par value $ . 0 0 l per shar e , of the " Compan y " has the meaning set forth in the preamble .

" Contractual Obligation " means as to any Person, any material provision of any security issued by such Person or any material provision of any agreement, lease of real or personal property, undertaking, contract, indenture, mortgage, deed of trust or other instrument including , without limitation, the organizational or governing documents of such Person , to which such Person is a party or by which it or any of its property is bound.

" Effective Dat e " has the meaning set forth in the preamble.

" Exchange Act " means the Securities Exchange Act of 1934, as amended . " Governmental Authorit y " means any court, tribunal, arbitrator, authority, agency, commission, official or other instrumentality of any government of any nation, state, city , locality or other political subdiv i sion.

" Holder " means (i) any person owning of record Registrable Shares that have not been sold to the public or (ii) any assignee of record of such Registrable Shares in accordance with Section 4.9 hereof.

" Initial Offerin g " means the Company's first firm commitment underwritten public offering of its Common Stock registered under the Securities Act.

" Person " means any individual, firm, corporation, partnership , trust , incorporated or unincorporated association, joint venture, joint stock company, Governmental Authority or other entity of any kind, and shall include any successor (by merger or otherwise) of such entity.

" Register ," " registered " and " registration " refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

" Registrable Shares " means (a) Common Stock of the Company issued to Smith pursuant to the Conversion Agreement; (b) any other shares of Common Stock hereafter owned or held by Smith; and (c) any " Registrable Shares" as defined in any other agreement pursuant to which the Company has granted registration rights. Notwithstanding the foregoing, Registrable Shares shall not include any securities sold by a Person to the public either pursuant to a registration statement or Securities Act Rule 144 or sold in a private transaction in which the transferor's rights pursuant to Section IV of this Agreement are not assigned.

" Registration Expenses " mea n s all expenses incurred by the Company in complying with Sections 4.1, 4.2 and 4.3 hereof , including, without limitation , all registration and filing fees, printing expenses, fees and disbursements of counsel for the Company , reasonable fees and disbursement s of a single special counsel for the Holders, blue sky fees and expenses and the expense of any special audits incident to or required by any such registration.

" Requirements of La w " mean s , as to any Person, the provisions of the charter and bylaws or other organizational or governing documents of such Person, and any law , treaty , rule, regulation, right , privilege , qualification , license or franchise , order , judgment, or determination of an arbitrator or a court or other Governmental Authority applicable to or binding upon such Person or any of its property (or to which such Person or any of its property is subject) or applicable to any or all of the trans ac tions contemplated by , or referred to in, this Agreement.

" Restricted Period" has the meaning set forth in Secti on 4 . 9.

" SEC " or " C o mmission " means the Securities and Exchange Commission.

" SEC Report s " shall mean all reports required to be filed with the SEC under the Securities Act and the Exchange Act.

" Securities Act" means the Securities Act of 1933 , as amended.

" Selling Expenses " means all underwriting discounts and selling commissions applicable to the sale.

" Violation" bas the meaning set forth in Section 4.7(a) .

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to Smith follows:

2.1 Authorization; Binding Effect. The Company has full power and authority to enter into and perform its obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors' rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

2.2 Non-contravention . The execution , delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby, do not and will not (i) violate any Requirements of Law applicable to the Company , or (ii) result in a material breach or default under any of the Contractual Obligations of the Company, or under any order, writ , judgment, injunction , decree, determination or award of any Governmental Authority , in each case applicable to the Company or its properties.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SMITH

Smith hereby represents and warrants as of the date hereof as follow s :

3.1 Authorization; Binding Effect . Smith has the requisite legal power and authority to enter into and perform his obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of Smith , enforceable against Smith in accordance with its terms, except (i) as may be limited by applicable bankruptcy , insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors' rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies .

3.2 Non-contravention . The execution, delivery and performance of this Agreement by Smith, and the consummation of the transactions contemplated hereby , do not and will not (a) violate any Requirements of Law applicable to Smith, or (b) result in a material breach or default under any of the Contractual Obligations of Smith, or under any order, writ , judgment, injunction, decree, determination or award of any Governmental Authority, in each case applicable to Smith or Smith's properties .

ARTICLE IV

REGISTRATION; COVENANTS OF T HE COMPANY

4.1 Registration . The Company shall, within six (6) months following the Effective Date, file a registration statement under the Securities Act covering the Registrable Shares and thereafter shall use its reasonable commercial efforts to cause such registration statement to be declared effective as soon thereafter as reasonably practicable. Such registration shall provide for sale or distribution of such Registrable Shares on a delayed or continuous basis pursuant to Rule 415 under the Securities Act to the extent it is available .

4.2 Piggyback Registration . The Company shall notify all Holders of Registrable Shares in writing at least thirty (30) days prior to the filing of any registration statement under the Securities Act for purposes of a public offering of securities of the Company (including , but not limited to , registration statements relating to secondary offerings of securities of the Company, but excluding registration statements relating to employee benefit plans or with respect to corporate reorganizations or other transactions under Rule 145 of the Securities Act), which notice will specify the proposed offering price, the kind and number of securities proposed to be registered, the distribution arrangements and such other information that at the time would be appropriate to include in such notice , and will afford each such Holder an opportunity to include in such registration statement all or part of such Registrable Shares held b y such Holder on terms and conditions at least as favorable as those applicable to the securities to be sold by the Company and by any other person thereunder . Each Holder desiring to include in any such registration statement all or an y part of the Registrable Shares held by it shall, within fifteen (15) days after the above-described notice from the Company, so notify the Company in writing. If a Holder decides not to include some or all of its Registrable Shares in any registration statement thereafter filed by the Company or decides to withdraw its Registrable Shares from any underwriting or registration pursuant to Section 4 . 1 , such Holder shall nevertheless continue to have the right to include any Registrable Shares in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein

a. Underwriting . If the registration statement under which the Company gives notice under this Section 4 . 2 is for an underwritten offering, the Company shall so advise the Holders of Registrable Shares . In such event, the right of any such Holder to be included in a registration pursuant to this Section 4.2 shall be conditioned upon such Holder ' s participation in such underwriting and the inclusion of such Holder's Registrable Shares in the underwriting to the extent provided herein . All Holders proposing to distribute their Registrable Shares through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision of this Agreement, if the underwriter determines in good faith that marketing factors require a limitation of the number of securities to be underwritten and advises the Holders of Registrable Shares in writing, the number of shares that may be included in the underwriting shall be allocated , first, to the Company; second , to the Holders on a pro rata basis based on the total number of Registrable Shares held by the Holders; and third, to any holder of securities of the Company (other than a Holder) on a pro rata basis . In making any such reduction , all shares held by employees of the Company which are not R e gistrable Shares shall first be excluded. No such reduction shall (i) reduce the securities being offered by the Company for its own account to be included in the registration and underwr i ting or (ii) reduce the amount of Registrable Shares of the selling Holders included in the registration below thirty three and one-third percent (33 1 /3%) of the total amount of securities included in such registration, unless such offering is the Initial Offering, in which event any or all of the Registrable Shares of the Holders may be excluded. If any Holder disapproves of the terms of any such underwriting , such Holder may elect to withdraw therefrom by written notice to the

- - '

Company and the underwriter , delivered at least ten (10) business days prior to the effective date of the registration statement. Any Registrable Shares excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder which is a partnership , limited liability company or corporation, the partners and members, retired partners and members and shareholders of such Holder, or the estates and family members of any such partners and members and retired partners and members and any trusts for the benefit of any of the foregoing person shall be deemed to be a single " Holder," and any pro rata reduction with respect to such "Holder" shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such " Holder ,” as defined in this sentence.

b . Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 4 . 2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration . The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4.4 hereof.

4.3 Form S-3 Registration . If the Company shall receive from Holders of at least seventy five percent (75%) of the Registrable Shares then outstanding a written request or requests that the Company effect a registration on Form S-3 or any similar short-form registration statement and any related qualification or compliance with respect to all or a part of the Registrable Shares owned by such Holder or Holders, the Company will :

a. promptly give written notice of the proposed registration, and any related qualification or compliance, to all other Holders of Registrable Securities; and

b. as soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder ' s or Holders' Registrable Shares as are specified in such request, together with all or such portion of the Registrable Shares of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company; provided , however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 4.3:

Holders, or

(i) if Form S-3 is not available for such offering by the

(ii) if the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Shares and such other securities (if any) at an aggregate price to the public of less than five hundred thousand dollars ($500,000) , or

which event the Company shall have the right to defer the filing of the Form S-3 registration statement for a period of not more than ninety (90) days after receipt of the request of the Holder or Holders under this Section 4.3; provided, that such right to delay a request shall be exercised by the Company not more than once in any twelve (12) month period, or

(iv) if the Company has, within the twelve (12) month period preceding the date of such request, already effected one (1) registration on Form S-3 for the Holders pursuant to this Section 4 . 3 .

c. Subject to the foregoing, the Company shall file a Form S-3 registration statement covering the Registrable Shares and other securities so requested to be registered as soon as practicable after receipt of the request or requests of the Holders. Registrations effected pursuant to this Section 4 . 3 shall not be counted as demands for registration or registrations effected pursuant to Section 4. 1 or Section 4 . 2 , respectively .

4.4 Expenses of Registration . Except as specifically provided herein, all Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to Sections 4.1, 4.2 or 4.3 herein shall be borne by the Company. All Selling Expenses applicable to Registrable Shares sold by Holders incurred in connection with any registrations hereunder shall be borne by the Holders of the securities so registered pro rata on the basis of the number of shares so registered.

4.5 Obligations of the Company. Whenever required to effect the registration of any Registrable Securities, the Company shall , as expeditiously as reasonably possible:

a. Prepare and file with the SEC a registration statement with respect to such Registrable Shares and use its best efforts to cause such registration statement to become effective as soon as possible, and in any event within thirty (30) days of the date on which the obligation to effect such registration arises, and , upon the request of the Holders of a majority of the Registrable Shares registered thereunder, keep such registration statement effective for up to one hundred eighty (180) days or, if a shelf registration pursuant to Securities Act Rule 415, until the Holder or Holders have completed the distribution related thereto .

b. Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement for the period set forth in paragraph (a) above .

c. Furnish to the Holders such number of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Shares owned by them.

d. Use its best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders.

e. In the event of any underwritten public offering , enter into and perform its obligations under an underwriting agreement , in usual and customary form , with the managing underwriter(s) of such offering. Each Holder participating in s uch underwriting shall also enter into and perform its obligations under such an agreement, provided that such underwriting agreement shall not provide for indemnification or contribution obligations on the part of the Holders greater than the obligations set forth in Sections 4.7(b) and (d).

f. Notify each Holder of Registrable Shares covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement , as then in effect, includes an untrue stat e ment of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and correct such misrepresentation or omission as expeditiously as reasonably possible .

g. Use its best efforts to furnish , on the date that such Registrable Shares are delivered to the underwriters for sale , if such securities are being sold through underwriters , (i) an opinion , dated as of s uch date , of the counsel repre s enting the Company for the purposes of such registration , in form and substance as is cu s tomarily given to underwriters in an underwritten public offering , add r essed to the underwriters , if any , and (ii ) to the Holders reque s ting registration of Registrable Securities , a letter dated as of such date , from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering addressed to the underwriters.

h. Cooperate and assist in any filings to be made with the Financial Industry Regulatory Authority , Inc.

i. Cause all such Registrable Shares to be listed on each securities exchange on which similar securities i s sued by the Company are then listed , or cause such Registrable Shares to be authorized for trading on the Nasdaq Stock Market if any similar securities issued by the Company are then so authorized , if requested by the Holders of a majority of such Registrable Securities.

j. Provide a transfer agent and registrar for all Registrable Shares registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration .

k. In connection with an underwritten offering , to the extent requested by the managing underwriters or Holders, participate in and support customary efforts to sell the Registrable Shares in the offering ; including without limitation , participating in " road shows. " ·

Registrable Shares held by them and the intended method of disposition of such securities as shall be required to effect the registration of their Registrable Securities.

4.7 Indemnification . In the event any Registrable Shares are included in a registration statement under Section 4.1, 4.2 or 4 . 3 :

a. To the extent permitted by law , the Company will indemnify and hold harmless each Holder, the partners, stockholders, members, officers and directors of each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses , claims, damages, or liabilities Goint or several) to which they may become subject under the Securities Act , the Exchange Act or other federal or state law, insofar as such losses , claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements , omissions or violations (collectively a "Violation") by the Company: (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securit i es Act, the Exchange Act or any state securities law in connection with the offering covered by such registration statement; and the Company will pay as incurred to each such Holder, partner, stockholder, member, officer, director, underwriter or controlling person any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided , however, that the indemnity agreement contained in this Section 4 . 7(a) shall not apply to amounts paid in settlement of any such loss, claim , damage, liability or action if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by such Holder, partner, officer, directo r , underwriter or controlling person of such Holder.

or the Exchange Act, may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder under an instrument duly executed by such Holder and stated to be specifically for use in connect i on with such registration ; and each such Holder will pay as incurred any legal or other expenses reasonably incurred by the Company or any such director, officer, controlling person, underwriter or other Holder , or the partners, stockholders, members, officers and directors of such other Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any , who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, in connection with investigating or defending any such loss , claim, damage , liability or action if it is judicially determined that there was such a Violation; provided , however, that the indemnity agreement contained in this Section 4 . 7 (b) shall not apply to amounts paid in settlement of any such loss, claim, damage , liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld ; provided further , that in no event shall any indemnity under th i s Section 4.7 exceed the proceeds from the offering received by such Holder; provided further, that any payments will be repaid to each such Holder if the Company acted recklessly .

c. Promptly after receipt by an indemnified party under this Section 4 . 7 of notice of the commencement of any action (including any governmental action), such indemnified party will, i f a claim in respect thereof is to be made against any indemnifying party under this Section 4.7 , deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall have the right to retain its own counsel, with the fees and expenses to be paid by the indemnifying party, if in the reasonable opinion of counsel representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if (and only to the extent) materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 4.7 , but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 4.7 .

whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties ' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission ; provided, that in no event shall any contribution by a Holder hereunder exceed the proceeds from the offering received by such Holder

e. The obligations of the Company and Holders under this Section 4.7 shall survive completion of any offering of Registrable Shares in a registration statement and the termination of this Agreement. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party , consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.

4.8 Assignment of Registration Rights . The rights to cause the Company to register Registrable Shares pursuant to this Article IV may be transferred or assigned by a Holder to a transferee or assignee of Registrable Shares which (a) is a subsidiary, parent, stockholder , general partner, limited partner, retired partner, member, retired member or Affiliate of a Holder, (b) is a Holder's Immediate Family member or an estate or trust of or for the benefit of an individual Holder, or (c) acquires at least twenty percent (20%) of the Registrable Shares held by such Holder; provided, however, (i) the transferor shall, within ten (10) days after such transfer, furnish to the Company written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (ii) such transferee shall become a party to thfa Agreement.

4.9 " Market Stand-Off ' Agreement; Agreement to Furnish Information . Each Holder hereby agrees that such Holder shall , if requested by the underwriter of any underwritten public offering of the Company's Common Stock, agree with such underwriter not to sell, transfer , make any short sale o f , grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale of, any Common Stock (or other securities) of the Company held by such Holder (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company (the " Restricted Period ") not to exceed ninety (90) days following the effective date of any registration statement of the Company filed under the Securities Act in connection with the Initial Offering ; provided that such agreements shall not apply to Registrable Shares included in such registration statement or sales or similar transactions effected pursuant to a valid exemption from the registration requirements of the Securities Act. Each Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other securities) of the Company, each Holder shall provide , within ten (10) days of such request, such information concerning such Holder as may be reasonably requested by the Company or such representative in connection with the completion of any public offering of the Company's securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section 4.9 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future , or a registration relating solely to a Rule 145 transaction on Form S-4

or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of the Restricted Period .

4.10 Information Regarding the Company . With a view to making available to Smith the benefits of certain rules and regulations of the SEC which may permit the sale of the Shares to the public without registration, the Company agrees to:

a. Following the date upon which the Company registers the Common Stock with the Commission under Section 12 of the Exchange Act, the Company will file with the SEC, in a timely manner, all reports and other documents required of the Company under the Exchange Act; and

b. So long as Smith owns any Shares, furnish to Smith forthwith upon request: (i) a written statement by the Company as to its compliance with the reporting requirements of the Exchange Act (at any time after it has become subject to such reporting requirements); (ii) a copy of the most recent annual or quarterly report of the Company; and (iii) such other reports and documents as Smith may reasonably request in availing itself of any rule or regulation of the SEC allowing it to sell the Notes without registration.

ARTICLE V

GENERAL PROVISIONS

5.1 Indemnification . Smith agrees to indemnify and hold harmless the Company, its officers, managers, affiliates, counsel, agents and each other Person, if any, who controls or is controlled by it, within the meaning of Section 15 of the Securities Act, against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all expenses reasonably incurred in investigating, preparing or defending against any litigation commenced or threatened or .any claim whatsoever) arising out of or based upon any false representation or warranty or breach or failure by Smith to comply with any covenant or agreement made by Smith herein or in any other document furnished by Smith to any of the foregoing in connection with this transaction.

5.2 Amendment . This Agreement may be amended, modified or supplemented at any time by the parties hereto only by an instrument in writing signed on behalf of each of the parties hereto. No agreement made through the use of electronic records or electronic signatures, as those terms are used in the Electronic Signatures in Global and National Commerce Act, 15 U. S . C. Sec. 7001 et. seq., shall be enforceable or binding on either party hereto. Notwithstanding the previous sentence, facsimile signatures, telecopied signatures , or copies of signatures in PDF format sent by e-mail, will constitute a sufficient form of writing for purposes of this Section 5.2 and Section 5.3.

5.3 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

5.4 Headings . The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

5.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

5.6 Severabilitv . If any one or more of the provisions contained herein, or the application thereof in any circumstance , is held invalid, illegal or unenforceable in any respect for any reason, the validity , legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired.

5.7 Entire Agreement; Waivers. This Agreement, together with the Settlement Agreement, is intended by the parties as a final expre s sion of their agreement and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises , warranties or undertakings, other than those set forth herein and in the Conversion Agreement. This Agreement and the Conversion Agreement supersede all prior agreement s and understandings between the parties with respect to such subject matter. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

5.8 Further Assurances. Each of the parties shall execute such documents and perform such further acts (including, without limitation, obtaining any consents , exemptions, authorizations, or other actions by, or giving any notices to, or making any filings with, any Governmental Authority or any other Person) as may be reasonably required or desirable to carry out or to perform the provisions of this Agreement.

5.9 Notices . All notices or other communications given or made hereunder shall be in writing and shall be delivered or mailed by registered or first class mail , postage prepaid, or express overnight courier service, to the address set forth in the Conversion Agreement .

(Signature Page Follows)

IN WITNESS WHEREOF, the Company and Smith have executed this Agreement as of , 2013.

		GEOSPATIAL HOLDINGS, INC.


	By:
		Thomas R. Oxenreiter, CFO



		Mark A . Smith

Geospatial Corporation S-1

EXHIBIT 10.8

EMPLOYMENT AGREEMENT

THIS AGREEMENT (“Agreement”), by and between GEOSPATIAL CORPORATION a Nevada Corporation (the “Company”), and Mark A. Smith (the “Executive”) is entered into as of October 18 ^th , 2013 (the “Employment Date”). In consideration of the mutual covenants set forth herein, the Company and the Executive hereby agree as follows:

2. Period of Employment. The term “Period of Employment” shall mean the period which commenced on the Employment Date and, unless earlier terminated pursuant to Section 6, ends on October 18, 2016; provided, however that the Period of Employment shall automatically be extended on a day-by-day and shall always be thirty-six (36) months unless either the Company or the Executive shall have terminated this automatic extension provision by giving written notice to the other.

3. Duties During the Period of Employment.

3.1 Duties. During the Period of Employment, the Executive shall be employed as the Chairman and Chief Executive Officer of the Company with overall charge and responsibility for the business and affairs of the Company. The Executive shall report directly to the Company’s Board of Directors (the “Board”) and shall perform such duties, as the Executive shall reasonably be directed to perform by the Board. The Company shall make all reasonable efforts to cause the Executive to be elected as the Chairman of the Board throughout the Period of Employment.

3.2 Scope. Throughout the Period of Employment, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive shall devote substantially all of his business time and attention to the business and affairs of the Company. It shall not be a violation of this Agreement for the Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach occasional courses or seminars at educational institutions, or (iii) manage personal and/or family investments and engage in any other activities, so long as such activities do not interfere, in any significant respect, with the Executive’s responsibilities hereunder or otherwise violate this Agreement.

4. Salary.

4.1 During the Period of Employment, the Executive’s Base Salary shall initially be at the rate of Three Hundred Twenty Thousand Dollars ($320,000) per year (the “Base Salary”). The Executive’s Base Salary shall be paid in accordance with the Company’s standard payroll practice. The Base Salary shall be reviewed by the Company’s Board of Directors or a committee of directors established by the Board of Directors having responsibility for compensation matters (in either case, the “Board”) as soon as practicable after the end of each fiscal year during the Period of Employment. Based on such reviews, the Board may increase, but shall not decrease the Base Salary. Any increase in Base Salary shall not serve to limit or reduce any other obligation of the Company under this Agreement.

4.2 Annual Bonuses.

4.2.1 Beginning with the Company’s fiscal year commencing on January 1st, 2013 (the “Initial Year”), the Executive shall participate in each annual and long-term incentive compensation plan established by the Board for executive officers of the Company (“Executive Compensation Plans”). For the initial year, the Executive’s target bonus award opportunity as a percentage of Base Salary (the “Target Bonus Amount”) in the Company’s annual incentive compensation plan (the “2013 Annual Bonus Plan) shall be at 100% of Executive’s Base Salary. The performance measures applicable to the Executive’s bonus opportunity for 2013 shall be deemed to be met and the performance measures for each successive fiscal year of the Company during the Period of Employment shall be set by reasonable good faith agreement of the Board and the Executive.

4.2.2 As soon as practicable after the end of the Initial Year and each fiscal year thereafter during the Period of Employment, the Board shall review the Executive’s performance under this Agreement as part of the Executive’s participation in the Executive Compensation Plans as in effect from time to time. The performance measures and the Target Bonus Amount applicable to the Executive’s bonus opportunity for each fiscal year of the Company, during the Period of Employment shall be established by the Board subject to Section 4.2.3 below. The Executive shall be paid his annual bonus, if any, no later than the date on which other senior executives of the Company are paid their annual bonuses. The Board may in its discretion, award the Executive bonuses in addition to those provided under any plans referred to above.

4.2.3 Other Compensation . During the Period of Employment, the Executive shall be entitled to participate, at a level and on a basis commensurate with the Executive’s position and responsibilities, in any and all supplemental compensation plans or arrangements established by the Company for its senior executives, including but not limited to any equity-based incentive compensation plans or arrangements. In all cases the Executive’s total annual compensation plan shall be equal or greater than other Company executives.

4.2.4 Payment of Professional Fees . The Company shall pay all invoices rendered to the Company by the Executive’s attorneys, accountants and other advisors for reasonable fees and expenses in connection with the negotiation and preparation of this Agreement; provided, however that the Company’s obligations pursuant to this Section 4.2.4 shall not exceed $25,000 incurred by the Executive.

5 . Other Executive Benefits.

5.2 Benefit Plans. The Executive and his eligible family members shall be entitled, subject to any normally applicable waiting periods and eligibility criteria, to participate, on terms no less favorable to the Executive than the terms offered to other senior executives of the Company, in a group and/or executive life, hospitalization or disability insurance plan, health program, pension, profit sharing, 401(k) and similar benefit plans (qualified, non-qualified and supplemental) or other fringe benefits (it being understood that items such as stock options and other equity awards are not fringe benefits) of the Company (collectively referred to as the “Benefits”). Anything contained herein to the contrary notwithstanding, the Benefits described herein shall not duplicate benefits made available to the Executive pursuant to any other provision of this Agreement.

5.3 Holidays and Vacations. During the Period of Employment, the Executive shall be entitled to the same paid holidays as other employees of the Company. The Executive shall be entitled to paid vacation and other absences from work that are reasonably consistent with the performance of the Executive’s duties as provided in this Agreement. Such vacations and absences shall be consistent with those generally provided to other senior executives of the Company.

5.4 Company Automobile. During the Period of Employment, the Executive shall have the use of an automobile provided by the Company in accordance with a policy approved by the Board; provided however, that no change adverse to the Executive may be made in that policy without the written consent of the Executive.

5.5 Facilities and Support. During the Period of Employment, the Company shall provide the Executive with office space, furnishings and facilities, secretarial and administrative assistance, supplies and equipment appropriate to enable the Executive to perform has duties under this Agreement and commensurate, in quality and quantity, with the facilities and support resources provided to the other senior executives of the Company.

5.6 Tax and Financial Planning Services. During the Period of Employment, the Company shall pay (or reimburse the Executive) for the cost of

personal tax and financial planning services and related expenses in an amount up to fifteen thousand dollars per year.

5.7 Executive Health Benefit. During the Period of Employment, the Company shall pay (or reimburse the Executive) for the cost of an annual Executive Physical at a medical facility chosen by the Executive in an amount up to ten thousand dollars per year.

6. Termination.

6.1 Death. The Period of Employment shall terminate automatically upon the Executive’s death.

6.2 Disability. If the Company determines in good faith that the Disability of the Executive has occurred (pursuant to the definition of “Disability” set forth below), it may give to the Executive written notice of its intention to terminate the Executive’s employment. In such event, the Period of Employment shall terminate effective on the 30 ^th day after receipt by the Executive of such written notice given at any time after a period of 120 consecutive days of Disability or a period of 180 days of Disability within any 12 consecutive months, and, in either case, while such Disability is continuing (“Disability Effective Date”). The Disability Effective Date shall not occur if the Executive returns to performance of the Executive’s duties as contemplated in this Agreement within 30 days after receipt of such notice. For purposes of this Agreement, “Disability”) means the Executive’s inability to substantially perform his duties hereunder, with reasonable accommodation, as evidenced by a certificate signed either by a physician mutually acceptable to the Company and the Executive or, if the Company and the Executive cannot agree upon a physician, by a physician selected by agreement of a physician designated by the Company and a physician designated by the Executive; provided, however, that if such physicians cannot agree upon a third within 30 days, such third physician shall be designated by the American Arbitration Association. Until the Disability Effective Date, the Executive shall be entitled to all compensation and benefits provided for under Sections 4 and 5 hereof. It is understood that nothing in this section 6.2 shall serve to limit the Company’s obligations under Section 7.3.

that the Executive’s action or omission was in the best interest of the Company. Any act or failure to act, based upon the advice of counsel for the Company shall be conclusively presumed to be done or omitted to be done, by the Executive in good faith and in the best interest of the Company. The foregoing notwithstanding, the Company may not terminate the Executive’s employment for Cause, and any purported termination by the Company of Executive’s employment shall be presumed other than for Cause, unless (i) a determination that Cause exists is made and approved by at least a 3/4ths majority of the Board, (ii) the Executive is given at least seven (7) days written notice of the Board meeting called to make such determination, including written notice of the particulars purporting to establish Cause and (iii) the Executive and his legal counsel are given the opportunity to address that meeting.

6.4 By Executive for Good Reason. During the Period of Employment, the Executive’s employment hereunder may be terminated by the Executive for Good Reason upon (30) thirty days written notice. For purposes of this Agreement, “Good Reason” means, with the Executive’s written consent, (a) any material breach of this Agreement by the Company (after the provision to the Company by the Executive of written notice reasonably specifying the breach and/or performance deficiency and thirty (30) days to cure such breach), (b) the assignment to the Executive of duties that are inconsistent with those of the Chairman and Chief Executive Officer of the Company or that materially impairs the Executive’s ability to perform his duties, or any other action by the Company that results in a significant diminution in the Executive’s position, authority, duties or responsibilities, to include without limitation the failure of the Executive to be named or elected as the Chairman of the Board (after the provision to the Company by the Executive of written notice reasonably specifying the basis upon which the Executive believes this clause has been violated and thirty (30) days to modify such assignment or change in his position), c) any relocation of the Executive’s office as assigned to him by the Company to a location more than twenty (20) miles from Natrona Heights, Pennsylvania; (d) delivery by the Company of a notice discontinuing the automatic extension provision of Section 2 of this Agreement; or (e) any termination by the Executive during the period of six (6) months immediately following the occurrence of a Change of Control, as defined in Section 8, below.

6.5 Other than for Cause or Good Reason . The Executive or the Company may terminate this Agreement for any reason other than for Good Reason or Cause, respectively, upon 30 days written notice to the Company or the Executive, as the case may be.

6.6 Notice of Termination. Any termination by the Company or by the Executive shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 18.2 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (a) indicates the specific termination provision in this Agreement relied upon, (b) sets forth in reasonable detail, if applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (c) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the Date of Termination. The failure by the Executive or Company to

set forth in the Notice of Termination any fact or circumstance which contributes to a showing of the basis for termination shall not waive any right of such party hereunder or preclude such party from asserting such fact or circumstance in enforcing his or it rights hereunder.

6.7 Date of Termination. “Date of Termination” means the date specified in the Notice of Termination; provided, however, that if the Executive’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be.

7.1 Termination by the Company for Cause or by Executive’s Resignation Without Good Reason. In the event the Period of Employment terminates by reason of the termination of the Executive’s employment by the Company for Cause, or by reason of the resignation of the Executive other than for good reason, the Company shall pay to the Executive all Accrued Obligations. “Accrued Obligations” shall mean, as of the Date of Termination, the sum of (a) the Executive’s Base Salary through the Date of Termination to the extent not theretofore paid, (b) the amount of any bonus, incentive compensation, deferred compensation and other cash compensation earned by the Executive as of the Date of Termination to the extent not theretofore paid, and (c) any vacation pay, expense reimbursements and other cash entitlements earned by the Executive as of the Date of Termination to the extent not theretofore paid.

7.4 Retirement. If the Executive voluntarily terminates his employment with the Company with or without Good Reason at any time after the Executive reaches the age of sixty (60) years old, he shall be treated as a retiree for purposes of all compensation and benefit plans, policies, arrangements and practices of the Company then in effect. He shall, in addition to receiving payment of the Accrued Obligations, at a minimum, until the death of the Executive, be paid monthly (a) 1/24 ^th of the Executive’s annual Base Salary on the Date of Termination (without regard to any reduction in Base Salary not approved by the Executive) and (b) 1/24 ^th of the annual bonus award to which the Executive would have been entitled calculated using the Target Bonus Amount for the year in which the Notice of Termination is given; payable for the remaining life of the Executive; and all equity awards granted to the Executive by the Company that have not yet vested shall fully vest on the Date of Termination; and all vested options (whether previously vested or vesting under this sentence) shall remain exercisable for a period equal to their full original terms.

7.5 Resignation with Good Reason, Death or Termination Without Cause. If the Company terminates the Executive’s employment other than for Cause (and other than due to the Executive’s Disability), if the Period of Employment is terminated by death, or if the Executive terminates his employment for Good Reason, the Executive shall receive, in addition to payment of the Accrued Obligations, the following:

7.5.1 A lump sum cash payment in an amount equal to two (2) times the number of months remaining in the Period of Employment multiplied by the sum of (a) 1/12 ^th of the Executive’s annual Base Salary on the Date of Termination (without regard to any reduction in Base Salary not approved by the Executive) and (b) 1/12 ^th of the annual bonus award to which the Executive would have been entitled calculated using the Target Bonus Amount for the year in which the Notice of Termination is given;

7.5.2 Immediate vesting in all equity awards granted to the Executive by the Company but not yet vested as of the Date of Termination;

7.5.3 Continued exercisability, for a period equal to their full original terms, for all vested options, whether previously vested or vesting under subsection 7.5.2;

7.5.4 For a period of 12 months after the Date of Termination, the Company shall continue health, prescription drug, dental, disability and life insurance benefits to the Executive and/or the Executive’s eligible family members at least equal to those which would have been provided to them in accordance with Section 5.2 of this Agreement if the Executive’s employment has not been terminated (provided that any benefits provided under this subsection 7.5.4 are subject to immediate early termination if the Executive becomes eligible to receive similar types of benefits through subsequent employment).

7.7 Exclusive Rights. It is understood that the Executive’s rights under this Section 7 are in lieu of all other rights, which the Executive may otherwise have had upon termination of employment under this Agreement.

7.8 No Right to Set-Off. The Company shall have no right to reduce, because of any debt or financial obligation of the Executive to the Company, the amount of any compensation or benefit otherwise payable by the Company to the Executive under this Agreement or under any other plan, policy, arrangement or practice of the Company.

8. Change of Control. For purposes of this Agreement, a “Change of Control” shall be deemed to have occurred if:

8.1 Change in Ownership. Any “person” (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 1943, as amended (the “Exchange Act”), excluding for this purpose, (a) the Executive, (b) the Company or any subsidiary of the Company, or (c) any employee benefit plan of the Company or of any subsidiary of the Company, or any person or entity organized, appointed or established by the Company for or pursuant to the terms of any such plan which acquires beneficial ownership of voting securities of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly of securities of the Company representing more than 30% of the combined voting power of the Company’s then outstanding securities; provided, however, that no Change of Control will be deemed to have occurred as a result of a change of ownership percentage resulting from an acquisition of securities by the Company; or

8.2 Change in Board. During any twenty-four (24) consecutive months, individuals who at the beginning of such twenty-four (24) month period constitute the Board of Directors of the Company and any new directors (except for any director designated by a person who has entered into an agreement with the Company to effect a transaction described elsewhere in this definition of Change of Control) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who were directors at the beginning of the period or whose election or nomination for election was previously so approved (such individuals and any such new directors being referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board: or

8.3 Business Combination. Consummation of a reorganization, merger or consolidation, or sale or disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, more than fifty-five percent (55%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity resulting from such Business Combination (including, without limitation, an entity which, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company; or

8.4 Liquidation. Consummation of a complete liquidation or dissolution of the Company.

Revenue Code (“Excise Tax”) is payable with respect to such Aggregate Payment, an additional amount which, after the imposition of all income and excise taxes thereon, is equal to the Excise Tax of the Aggregate Payment. The determination of whether the Aggregate Payment constitutes an excess parachute payment and, if so, the amount to be provided to the Executive and the time of payment pursuant to this Section 8 shall be made by an independent auditor (the “Auditor”) jointly selected by the Company and the Executive and paid by the Company. The Auditor shall be a nationally recognized United States public accounting firm which has not, during the two (2) years immediately preceding the date of it selection, acted in any way of behalf of the Company or any affiliate thereof. If the Executive and the Company cannot agree on the firm to serve as the Auditor, then the Executive and the Company shall each select one accounting firm and those two firms shall jointly select the accounting firm to serve as the Auditor. Notwithstanding the foregoing, in the event that the amount of the Executive’s Excise Tax liability is subsequently determined to be greater than the Excise Tax liability with respect to which any initial payment to the Executive under this Section 8 has been made, the Company shall pay to the Executive an additional amount (grossed up for all taxes), with respect to such additional Excise Tax (and any interest and penalties thereon) at the time and in the amount reasonably determined by the Auditor. Similarly, if the amount of the Executive’s Excise Tax liability is subsequently determined to be less than the Excise Tax Liability with respect to which any prior payment to the Executive has been made under this Section 8, the Executive shall refund to the Company the excess amount received, after reduction for any nonrefundable tax, penalties and/or interest incurred by the Executive in connection with the receipt of such excess, and such refund shall be paid promptly after the Executive has received any corresponding refund of excess Excise Tax paid to the Internal Revenue Service. The Executive and the Company shall cooperate with each other in connection with any proceeding or claim relating to the existence or amount of liability for Excise Tax, and all expenses incurred by the Executive in connection therewith shall be paid by the Company promptly upon notice of demand from the Executive.

10. Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement. Except as otherwise set forth herein with respect to health, prescription drug, dental disability and life insurance benefits, any severance benefits payable to the Executive shall not be subject to reduction for any compensation received from other employment.

11. Indemnification. The Executive shall be indemnified by the Company against liability as an officer and director of the Company and any subsidiary or affiliate of the Company to the maximum extent permitted by applicable law. To the full extent permitted under the corporate governing documents of the Company, and subject to the terms of any policy and procedures applicable to all directors and senior officers of the Company, the Company shall advance to the Executive payment of reasonable costs of defending against any claims covered by the foregoing indemnification commitment. The Executive’s rights under this Section 11 shall continue so long as he may be subject to such liability, whether or not this Agreement may have terminated prior thereto.

12. Withholding. Anything in this Agreement to the contrary notwithstanding, all payments required to be made by the Company hereunder to the Executive shall be subject to withholding at the time payments are actually made to the Executive and received by him of such amounts relating to taxes as the Company may reasonably determine it should withhold pursuant to any applicable law or regulation. In lieu of withholding such amounts, in whole or in part, the Company may, in its sole discretion, accept other provision for payment of taxes as required by law, provided that it is satisfied that all requirements of law as to its responsibilities to withhold such taxes have been satisfied.

13. Arbitration. Any dispute or controversy between the Company and the Executive arising out of or relating to this Agreement shall be settled by arbitration conducted under the rules of (but not necessarily administered by) the American Arbitration Association (“AAA”) in accordance with its National Rules for the Resolution of Employment Disputes then in effect, and judgment on any award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Any arbitration shall be held before a single arbitrator who shall be selected by the agreement of the Company and the Executive, unless the parties are unable to agree to and arbitrator, in which case the arbitrator will be selected under the procedures of the AAA. The arbitrator shall have the authority to award any remedy or relief that a court of competent jurisdiction could order or grant, including without limitation, the issuance of an injunction. Either party may, without inconsistency with this arbitration provision, apply to any court having jurisdiction over the parties and seek interim provisional, injunctive or other interim equitable relief until the arbitration award is rendered or the controversy is otherwise resolved. Except as necessary in court proceedings to enforce this arbitration provision or an award rendered hereunder, or to obtain interim relief, neither a party nor an arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of the Company and the Executive. The Company and the Executive acknowledge that this Agreement evidences a transaction involving interstate commerce. Notwithstanding any choice of law provision included in this Agreement, the United States Federal Arbitration Act shall govern the interpretation and enforcement of this arbitration provision. The arbitration proceedings shall be conducted in Pittsburgh, Pennsylvania or such other location to which the parties may agree. The Company shall pay the costs of any arbitrator appointed hereunder.

reimburse the Executive for all reasonable costs and expenses relating to such claim or dispute; provided that the Executive agrees in writing that he will repay the Company in full for such reimbursement if he is not ultimately successful to a material degree with respect to the substance of such claim or dispute. In addition, the Company shall promptly reimburse the Executive for all reasonable costs and expenses (including, but not limited to, attorneys’ fees) incurred by the Executive in preparing responses to Internal Revenue Service (“IRS”) audits of the Executives personal income tax returns or otherwise defending such tax returns in any administrative proceeding or civil litigation relating thereto that is occasioned by or connected with an audit by the IRS of one or more income tax returns of the Company. The provisions of this Section 15 shall survive the expiration or termination of this Agreement and the Period of Employment.

15. Successors.

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

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

15.3 As used in this Agreement, the term “Company” shall include any successor to the Company’s business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

16. Representations.

16.1 The Company represents and warrants that (a) the execution of this Agreement has been duly authorized by the Company, including action of the Board, (b) the execution, delivery and performance of this Agreement by the Company does not an will not violate any law, regulation, order, judgment or decree or any agreement, plan or corporate governance document of the Company, and (c) upon the execution and delivery of this Agreement by the Executive, this Agreement shall be the valid and binding obligation of the Company, enforceable in accordance with its terms, except to the extent enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by the effect of general principals of equity (regardless of whether enforceability is considered in proceeding in equity or at law).

Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive, enforceable in accordance with its terms, except to the extent enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by the effect of general principals of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

17. Miscellaneous.

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

17.2 All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed to have been duly given or made the second business day after the date of mailing, if delivered by registered or certified mail, postage prepaid; upon delivery, if sent by hand delivery; upon delivery, if sent by prepaid courier, with a record of receipt; or the next day after the date of dispatch, if sent by cable, telegram, facsimile or telecopy (with a copy simultaneously sent by registered or certified mail, postage prepaid, return receipt requested), to the parties at the following addresses:

	If to the Executive:

	Mark A. Smith
	1001 Carlisle Street
	Natrona Heights, PA 15065
	Telephone: 724-226-2067 or 724-994-8055

	If to the Company:

	Geospatial Corporation
	229 Howes Run Road
	Sarver, PA 16055
	Attention: General Counsel

	Fax: 724-353-3049
	Telephone: 724-353-3400

Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.

17.3 None of the provisions of this Agreement shall be deemed to impose a penalty.

17.4 The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

17.5 Any party’s failure to insist upon strict compliance with any provision hereof shall not be deemed to be a waiver of such provision or any other provision hereof.

17.6 This Agreement supersedes any and all prior communications, understandings and agreements, written or oral, between the Company and the Executive with respect to the subject matter hereof. In the event of any inconsistency between this Agreement and any plan, policy, arrangement or practice of the Company, the relevant provision of this Agreement shall control.

17.7 This Agreement may be executed simultaneously in two (2) or more counterparts, each of which shall be deemed an original but all of which together shall constitute on and the same instrument.

IN WITNESS WHEREOF , the parties have executed this Agreement as of the date first above written.

		Geospatial Corporation


	By:	/s/ Thomas R. Oxenreiter
		Thomas R. Oxenreiter, Director


		/s/ Mark A . Smith
		Mark A . Smith, an Individual

Geospatial Corporation S-1

EXHIBIT 10.9

GEOSPATIAL CORPORATION

STOCK APPRECIATION RIGHTS AGREEMENT

This Stock Appreciation Rights Agreement (this “ Agreement ”) is made and entered into as of October 18, 2013 by and between GEOSPATIAL CORPORATION, a Nevada corporation (the “ Company ”) and Mark A. Smith (the “ Participant ”).

Grant Date: _____October 18, 2013_________________

Number of SARs: ___3,000,000____________________

Exercise Price per SAR: _______$0.07_______________

Expiration Date: _____October 18, 2023_______________

1. Grant of SARs .

1.1 Grant . The Company hereby grants to the Participant an aggregate of 3,000,000 stock appreciation rights (the “ SARs ”). Each SAR entitles the Grantee to receive, upon exercise, an amount equal to the excess of (a) the Fair Market Value of a share of Common Stock on the date of exercise, over (b) the Exercise Price (the “ Appreciation Value ”). The SARs are being granted pursuant to the terms of the Company’s 2013 Equity Incentive Plan (the “ Plan ”).

1.2 Consideration; Subject to Plan . The grant of the SARs is made in consideration of the services to be rendered by the Participant to the Company and is subject to the terms and conditions of the Plan. Capitalized terms used but not defined herein will have the meaning ascribed to them in the Plan.

2. Vesting .

2.1 Vesting Schedule . The SARs will vest and become exercisable in three equal installments with the first installment being on the Grant Date and the balance on each of the first and second anniversaries of the Grant Date. Except as otherwise provided in this Agreement, the unvested SARs will not be exercisable on or after the Participant’s termination of Continuous Service.

2.2 Expiration . The SARs will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.

3. Termination of Continuous Service .

3.1 Termination for Reasons Other Than Cause, Death, Disability . If the Participant’s Continuous Service is terminated for any reason other than Cause, death or Disability, the Participant may exercise the vested SARs, but only within such period of time ending on the earlier of (a) the date three months following the termination of the Participant’s Continuous Service or (b) the Expiration Date.

3.2 Termination for Cause . If the Participant’s Continuous Service is terminated for Cause, the SARs (whether vested or unvested) shall immediately terminate and cease to be exercisable.

3.3 Termination Due to Disability . If the Participant’s Continuous Service terminates as a result of the Participant’s Disability, the Participant may exercise the vested SARs, but only within such period of time ending on the earlier of (a) the date 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.

3.4 Termination Due to Death . If the Participant’s Continuous Service terminates as a result of the Participant’s death, the vested SARs may be exercised by the Participant’s estate, by a person who acquired the right to exercise the SARs by bequest or inheritance or by the person designated to exercise the SARs upon the Participant’s death, but only within the time period ending on the earlier of (a) the date 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.

4. Manner of Exercise .

4.1 When to Exercise . Except as otherwise provided in the Plan or this Agreement, the Participant (or in the case of exercise after the Participant’s death or incapacity, the Participant’s executor, administrator, heir or legatee, as the case may be) may exercise his or her vested SARs, in whole or in part, at any time after vesting and until the Expiration Date or earlier termination pursuant to Section 3 hereof, by following the procedures set forth in this Section 4 . If partially exercised, the Participant may exercise the remaining unexercised portion of the SARs at any time after vesting and until the Expiration Date or earlier termination pursuant to Section 3 hereof. No SARs shall be exercisable after the Expiration Date.

4.2 Election to Exercise . To exercise the SARs, the Participant (or in the case of exercise after the Participant’s death or incapacity, the Participant’s executor, administrator, heir or legatee, as the case may be) must deliver to the Company a written notice (or notice through another previously approved method, which could include a web-based or e-mail system) to the Chief Financial Officer of the Company which sets forth the number of SARs being exercised, together with any additional documents as the Company may require. Each such notice must satisfy whatever then-current procedures apply to the SARs and must contain such representations as the Company requires.

4.3 Documentation of Right to Exercise . If someone other than the Participant exercises the SARs, then such person must submit documentation reasonably acceptable to the Company verifying that such person has the legal right to exercise the SARs.

4.4 Date of Exercise . The SARs shall be deemed to be exercised on the business day that the Company receives a fully executed exercise notice. If the notice is received after business hours on such date, then the SAR shall be deemed to be exercised on the business date immediately following the business date such notice is received by the Company.

5. Withholding . Prior to the payment of the Appreciation Value in connection with the exercise of the SARs, the Participant must make arrangements satisfactory to the Company to pay or provide for any applicable federal, state and local withholding obligations of the Company. If approved by the Committee in its discretion, the minimum required withholding obligations may be settled by the delivery to the Company of previously owned and unencumbered shares of Common Stock.

6. Form of Payment . Upon the exercise of all or a portion of the SARs, the Participant shall be entitled to a payment in cash or stock (solely at the discretion of the Committee) equal to the Appreciation Value of the SARs being exercised, less any amounts withheld pursuant to Section 5 .

7. Section 409A; No Deferral of Compensation . Neither the Plan nor this Agreement is intended to provide for the deferral of compensation within the meaning of Section 409A of the Internal Revenue Code (the “ Code ”). The Company reserves the right to unilaterally amend or modify the Plan or this Agreement, to the extent the Company considers it necessary or advisable, in its sole discretion, to comply with, or to ensure that the SARs granted hereunder are not subject to, Section 409A of the Code.

8. No Right to Continued Employment . Neither the Plan nor this Agreement shall confer upon the Participant any right to be retained in any position, as an Employee, Consultant or Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate the Participant’s Continuous Service at any time, with or without Cause.

9. Transferability . The SARs are not transferable by the Participant other than to a designated beneficiary upon the Participant’s death or by will or the laws of descent and distribution, and are exercisable during the Participant’s lifetime only by him or her. No assignment or transfer of the SARs, or the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise (except to a designated beneficiary upon death by will or the laws of descent or distribution) will vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the SARs will terminate and become of no further effect.

10. Change in Control .

10.1 Effect on SARs . In the event of a Change in Control, notwithstanding any provision of the Plan or this Agreement to the contrary, the SARs shall become immediately vested and exercisable.

10.2 Cash-out . In the event of a Change in Control, the Committee may, in its discretion and upon at least ten (10) days’ advance notice to the Participant, cancel the SARs and pay to the Participant the Appreciation Value of the SARs based upon the price per share of Common Stock received or to be received by other shareholders of the Company in the event. Notwithstanding the foregoing, if at the time of a Change in Control the Exercise Price of the SAR equals or exceeds the price paid for a share of Common Stock in connection with the Change in Control, the Committee may cancel the SAR without the payment of consideration therefor.

11. Adjustments . The SARs may be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.

12. Tax Liability and Withholding . Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“ Tax-Related Items ”), the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting, or exercise of the SARs and (b) does not commit to structure the SARs to reduce or eliminate the Participant’s liability for Tax-Related Items.

13. Non-competition and Non-solicitation .

13.1 In consideration of the SARs, the Participant agrees and covenants not to:

(a) contribute his or her knowledge, directly or indirectly, in whole or in part, as an employee, officer, owner, manager, advisor, consultant, agent, partner, director, shareholder, volunteer, intern or in any other similar capacity to an entity engaged in the same or similar business as the Company and its Affiliates, including those engaged in the business of Infrastructure Mapping or Software Development for a period of 36 months following the Participant’s termination of Continuous Service;

(b) directly or indirectly, solicit, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the Company or its Affiliates for 36 months following the Participant’s termination of Continuous Service; or

(c) directly or indirectly, solicit, contact (including, but not limited to, e-mail, regular mail, express mail, telephone, fax, and instant message), attempt to contact or meet with the current, former or prospective customers of the Company or any of its Affiliates for purposes of offering or accepting goods or services similar to or competitive with those offered by the Company or any of its Affiliates for a period of 36 months following the Participant’s termination of Continuous Service.

13.2 In the event of a breach or threatened breach of any of the covenants contained in Section 13.1 :

(a) any unvested SARs shall be forfeited effective as of the date of such breach, unless sooner terminated by operation of another term or condition of this Agreement or the Plan; and

(b) the Participant hereby consents and agrees that the Company shall be entitled to seek, in addition to other available remedies, a temporary or permanent injunction or other equitable relief against such breach or threatened breach from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief.

14. Compliance with Law . The exercise of the SARs shall be subject to compliance by the Company and the Participant with all Applicable Laws, including the requirements of any stock exchange on which the Company’s shares of Common Stock may be listed. The Participant may not exercise the SARs if such exercise would violate any applicable Federal or state securities laws or other laws or regulations. The Participant understands that the Company is under no obligation to register the shares of Common Stock with the Securities and Exchange Commission, any state securities commission or any stock exchange to effect such compliance.

15. Notices . Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Chief Financial Officer of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Participant under this Agreement shall be in writing and addressed to the Participant at the Participant’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

16. Governing Law . This Agreement will be construed and interpreted in accordance with the laws of the State of Nevada without regard to conflict of law principles.

17. Interpretation . Any dispute regarding the interpretation of this Agreement shall be submitted by the Participant or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Participant and the Company.

18. SARs Subject to Plan . This Agreement is subject to the Plan as approved by the Company’s shareholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

19. Successors and Assigns . The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the person(s) to whom the SARs may be transferred by will or the laws of descent or distribution.

20. Severability . The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.

21. Discretionary Nature of Plan . The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the SARs in this Agreement does not create any contractual right or other right to receive any SARs or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant’s employment with the Company.

22. Amendment . The Committee has the right to amend, alter, suspend, discontinue or cancel the SAR, prospectively or retroactively; provided, that , no such amendment shall adversely affect the Participant’s material rights under this Agreement without the Participant’s consent.

23. No Impact on Other Benefits . The value of the Participant’s SARs is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.

24. Counterparts . This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

25. Acceptance . The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions thereof, and accepts the SARs subject to all of the terms and conditions of the Plan and this Agreement. The Participant acknowledges that there may be adverse tax consequences upon exercise of the SARs and that the Participant should consult a tax advisor prior to such exercise.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

	GEOSPATIAL CORPORATION

	By:	/s/ Thomas R. Oxenreiter
	Name:	Thomas R. Oxenreiter
	Title:	Chief Financial Officer/Secretary

	Mark A. Smith

	By:	/s/ Mark A. Smith
	Name:	Mark A. Smith

Geospatial Corporation S-1

EXHIBIT 10.10

GEOSPATIAL CORPORATION

STOCK APPRECIATION RIGHTS AGREEMENT

Grant Date: _________ October 18, 2013 __________________

Number of SARs: _________ 3,000,000 ____________________

Exercise Price per SAR: __________ $0.07 _______________

Expiration Date: _________ October 18, 2023 _______________

1. Grant of SARs .

2. Vesting .

2.2 Expiration . The SARs will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.

3. Termination of Continuous Service .

3.2 Termination for Cause . If the Participant’s Continuous Service is terminated for Cause, the SARs (whether vested or unvested) shall immediately terminate and cease to be exercisable.

4. Manner of Exercise .

10. Change in Control .

10.1 Effect on SARs . In the event of a Change in Control, notwithstanding any provision of the Plan or this Agreement to the contrary, the SARs shall become immediately vested and exercisable.

11. Adjustments . The SARs may be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.

13. Non-competition and Non-solicitation .

13.1 In consideration of the SARs, the Participant agrees and covenants not to:

13.2 In the event of a breach or threatened breach of any of the covenants contained in Section 13.1 :

(a) any unvested SARs shall be forfeited effective as of the date of such breach, unless sooner terminated by operation of another term or condition of this Agreement or the Plan; and

16. Governing Law . This Agreement will be construed and interpreted in accordance with the laws of the State of Nevada without regard to conflict of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

	GEOSPATIAL CORPORATION

	By:	/s/ Mark A. Smith
	Name:	Mark A. Smith
	Title:	CEO

	Troy Taggart

	By:	/s/ Troy Taggart
	Name:	Troy Taggart

Geospatial Corporation S-1

Exhibit 10.11

EXECUTION COPY

G EOSPATIAL M APPING S YSTEMS , I NC .

2007 S TOCK OPTION P LAN

N ONQUALIFIED S TOCK O PTION A GREEMENT

This O PTION A WARD A GREEMENT (“ Agreement ”) is dated effective March 13, 2008 (the “ Grant Date ”), and is between Geospatial Mapping Systems, Inc., a Delaware corporation (the “ Company ”), and Thomas R. Oxenreiter (the “ Participant ”). Any term capitalized but not defined in this Agreement will have the meaning set forth in the Geospatial Mapping Systems, Inc. 2007 Stock Option Plan (the “ Plan ”).

1. Option Grant . In accordance with the terms of the Plan and subject to the terms and conditions of this Agreement, the Company hereby grants to the Participant an option to purchase all or any part of an aggregate of One Hundred Thousand (100,000) of the Company’s Shares (the “ Option ”). The Participant may exercise this Option only after it has become vested in accordance with the provisions of Section 4 . This Option is a nonqualified option that is not intended to meet the requirements of Code Section 422.

2. Exercise Price . The Exercise Price will be $0.80 per Share, which is no less than the Fair Market Value of a Share on the Grant Date.

4. Term, Vesting and Exercise of the Option .

(a) The Option will expire on the tenth anniversary of the Grant Date (the “ Expiration Date ”).

(b) One Third of the Options shall vest and become exercisable 12 months from the Grant Date and one third shall vest on each 12 month anniversary of the Grant Date.

5. Termination of Service . After termination of Service, the Participant’s right to exercise the Option will be subject to the following rules:

(e) In no event may the Option be exercised after the Expiration Date.

7. Confidentiality, Competition, and Nonsolicitation . Participant has entered into an Agreement Not-To-Compete dated March 13, 2008.

(b) Prior to the consummation of a Public Offering, in no event may a Participant sell, transfer or otherwise dispose of an Owned Share without the Board’s advanced written approval.

9. Securities Law Requirements .

10. No Obligation to Exercise Option . Neither the Participant nor his or her transferee is or will be obligated by the grant of the Option to exercise it.

14. Notice . Any notice or other communication required or permitted under this Agreement must be in writing and must be delivered personally, sent by certified, registered or express mail, or sent by overnight courier, at the sender’s expense. Notice will be deemed given when delivered personally or, if mailed, three days after the date of deposit in the United States mail or, if sent by overnight courier, on the regular business day following the date sent. Notice to the Company should be sent to Geospatial Mapping Systems, Inc. 229 Howes Run Road, Sarver, PA 16055. Notice to the Participant should be sent to the address set forth on the signature page below. Either party may change the Person and/or address to whom the other party must give notice under this Section by giving such other party written notice of such change, in accordance with the procedures described above.

18. Amendment of the Agreement . The Company and the Participant may amend this Agreement only by a written instrument signed by both parties.

19. Counterparts . The parties may execute this Agreement in one or more counterparts, all of which together shall constitute but one Agreement.

[signature page follows]

IN WITNESS WHEREOF, the Company and the Participant have duly executed this Agreement as of the date first written above.


GEOSPATIAL MAPPING SYSTEMS, INC.			/s/ Thomas R. Oxenreiter
			(Participant’s Signature)
By:	/s/ Mark A. Smith
	Its:	President	Participant’s Name and Address for notices

			T HOMAS R. O XENREITER
			435 R OYCE A VENUE
			P ITTSBURGH , PA 15216

O PTION E XERCISE F ORM

I hereby agree to be bound by all of the provisions of, and to execute any applicable Shareholder Agreement or related document required by the Company.


Date of Exercise



				Signature of Person Exercising Option

Please type or print legibly your name, as you want it to appear on your stock certificate, your address and your social security number in the space provided below.


Name:

Address:


	(Street)


(City)	(State)	(Zip Code)


Social Security Number:

Geospatial Corporation S-1

Exhibit 10.12

EXECUTION COPY

AGREEMENT NOT-TO-COMPETE

This Agreement Not-To-Compete (the “Agreement”) is made and entered into as of March 13, 2008, by and between Geospatial Mapping Systems, Inc., a Delaware corporation (the “Company”) and Thomas R. Oxenreiter (the “Employee”).

WHEREAS, the Employee is employed by the Company;

WHEREAS, in the course of the Employee’s employment, the Employee will obtain extensive knowledge of and experience in the business conducted by the Company;

WHEREAS, the Employee will enjoy extensive high level contacts with customers and prospective customers of the Company and will have access to confidential and proprietary information of the Company;

WHEREAS, the Company has entered into a Nonqualified Option Agreement with the Employee in consideration for the Employee entering into this Agreement;

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties agree as follows:

1. Confidential Information .

2. Noncompetition and Nonsolicitation .

(a) The Employee agrees that during the Period of Employment and for a period of twelve full months following the Date of Termination (the “Non-Compete Period”), the Employee will not, directly or indirectly, individually or otherwise, engage in a business competing with any of the businesses conducted by any member of the Company any where in the United States, nor without the prior written consent of the Board directly or indirectly have any interest in, own, manage, operate, control, be connected with as a stockholder, joint venturer, lender, officer, employee, partner or consultant, or otherwise engage, invest or participate in any business that is competitive with any of the businesses conducted by any member of the Company; provided , however , that nothing contained in this Section 2(a) shall prevent the Employee from being the registered or beneficial owner of up to 2% of any class of the capital stock of a corporation registered under the Securities Exchange Act of 1934, as amended. The Employee further agrees that during the Non-Compete Period the Employee will not, in any manner, directly or indirectly, for the Employee’s benefit or for the benefit of any other person, firm or entity, (1) induce or attempt to induce any employee of any member of the Company to terminate or abandon his or her employment with any such member for any purpose whatsoever, (2) solicit from any customer doing business with any member of the Company during the Non-Compete Period, business of the same or similar nature to the business of any member of the Company with such customer, or (3) otherwise interfere with the business or accounts of any member of the Company.

(b) As consideration for the Employee’s agreement to the provisions of Sections 1 and 2(a), the Company has entered into the Employment Agreement with Employee.


	if to the Executive, to:

	Thomas R. Oxenreiter
	435 Royce Avenue Pittsburgh, PA 15216
	Telephone: 412-343-7913

	if to Company, to:

	Geospatial Mapping Systems, Inc.
	229 Howes Run Road Sarver, PA 16055
	Attention: General Counsel
	Facsimile: 724-353-3049
	Telephone: 724-353-3400

Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.

6. Counterparts . This Agreement may be executed in counterparts, each of which shall be an original, but all of which together shall constitute one agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and in the year first written above.


	COMPANY:

	GEOSPATIAL MAPPING SYSTEMS, INC.

	/s/ Mark A. Smith
	By:		Mark A. Smith
	Its:		President

	/s/ Thomas R. Oxenreiter
	Thomas R. Oxenreiter

Geospatial Corporation S-1

EXHIBIT 10.13

CONVERSION AGREEMENT

This Conversion Agreement (“ Agreement ”) is made and entered into as of August 20, 2013, by and among Geospatial Holdings, Inc., a Nevada corporation (the “Company”), Geospatial Mapping Systems, Inc., a Delaware corporation and a wholly-owned subsidiary of the Company (“ GMS ”) and Thomas R. Oxenreiter, Chief Financial Officer of the Company (“ Oxenreiter ”).

RECITALS

WHEREAS, from December 1, 2009 to June 30, 2012, Oxenreiter incurred expenses and made disbursements in the course of performing his duties for the Company, which have not been reimbursed to Oxenreiter by the Company, all of which unreimbursed amounts aggregate $12,061.74 (the “Unpaid Expense Amount”); and

WHEREAS, from July 1, 2012 through August 1, 2013, Oxenreiter has incurred expenses and made disbursements in the course of performing his duties for the Company, which has not been reimbursed to Oxenreiter by the Company, all of which unreimbursed amounts aggregate $1,759.33 (the “Recent Unpaid Expense Amount”); and

WHEREAS, GMS has not paid to Oxenreiter his salary in the aggregate amount of $223,958.62 for the period prior to and including June 30, 2012 (the “ Unpaid Salary Amount ”) and (b) $31,250.04 for the period from July 1, 2012 through August 1, 2013 (the “ Recent Unpaid Salary Amount ”); and

WHEREAS, the Company and GMS desire that Oxenreiter exchange (i) the Unpaid Expense Amount and (ii) the Unpaid Salary Amount for shares of common stock, par value $.001 per share, of the Company (“ Common Stock ”), and a warrant to purchase shares of Common Stock; and

WHEREAS, the Company and Oxenreiter desire to memorialize the Recent Unpaid Expense Amount and the Recent Unpaid Salary Amount, and agree upon the terms of their payment;

WHEREAS, the Company desires to grant certain registration rights to Oxenreiter.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company, GMS and Oxenreiter hereby agrees as follows:

AGREEMENT

1. CONVERSION AND RELEASE.

1.1 Conversion into Common Stock and Warrant . Upon the terms and subject to the conditions of this Agreement, Oxenreiter hereby surrenders and releases to the Company his right to receive payment of the Unpaid Expense Amount and the Unpaid Salary Amount, and in exchange therefor, the Company hereby issues and delivers to Oxenreiter (a) 3,371,719 shares of Common Stock (the “Conversion Stock”) and (b) a warrant to purchase 337, 172 shares of Common Stock in the form of Exhibit A hereto (the “Warrant”).

1.2 Release . Oxenreiter hereby accepts the Conversion Stock and the Warrant in full payment and satisfaction of the Unpaid Expense Amount and the Unpaid Salary Amount, and releases and discharges the Company, GMS and all of their respective employees, agents, successors, assigns, affiliates, directors and officers from and against any and all other obligations or liabilities relating to the Unpaid Expense Amount and the Unpaid Salary Amount. Notwithstanding anything in this Agreement to the contrary, nothing contained herein is intended to, and this Agreement shall not operate to, release any claims Oxenreiter may have to enforce any rights conferred under this Agreement.

1.3 Payment of Taxes . To the extent that the issuance of the Conversion Stock and the Warrant to Oxenreiter would be subject to taxes imposed against Oxenreiter under the Internal Revenue Code of 1986, as amended, the Federal Insurance Contributions Act, as amended, and any state or local tax code or regulation, if applicable (collectively, the “Taxes”), then Oxenreiter shall be entitled to receive a payment from the Company (the “ Gross-Up Payment” ) in an amount such that after payment by Oxenreiter of all federal, state and local taxes (including income taxes and excise taxes) imposed on the Gross-Up Payment, Oxenreiter retains an amount of the Gross-Up Payment equal to the Taxes.

1.4 Repayment of Recent Unpaid Expense Amount and Recent Unpaid Salary Amount . The Company hereby acknowledges its obligation and liability to pay the Recent Unpaid Expense Amount and the Recent Unpaid Salary Amount to Oxenreiter and agrees to use its reasonable commercial efforts to pay such amounts to Oxenreiter as soon as possible.

1.5 Registration Rights. Concurrently with the execution and delivery of this Agreement, the Company and Oxenreiter are entering into a Registration Rights Agreement in the form of Exhibit B hereto (the “ Registration Rights Agreement ”).

2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby represents and warrants to Oxenreiter that as of the Effective Date:

2.1 Organization . The Company is duly organized, validly existing and in good standing under the laws of the State of Nevada. The Company has full power and authority to own or lease its properties and to carry on its business as presently conducted.

2.2 Due Authorization and Valid Issuance . The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement, the Warrant and the Registration Rights Agreement. This Agreement, the Warrant the Registration Rights Agreement have been duly authorized and validly executed and delivered by the Company and each constitutes the legal, valid and binding agreement of the Company enforceable against the Company in accordance with its terms, except as (a) rights to indemnity and contribution may be limited by state or federal securities laws of the public policy underlying such laws, (b) enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights and contracting parties’ rights generally and (c) enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

2.3 Capitalization . Immediately prior to giving effect to the transactions contemplated by this Agreement, the authorized capital stock of the Company consists of (i) 100,000,000 shares of common stock, par value $.001 per share, of which 45,871,371 shares are issued and outstanding, and (ii) 5,000,000 shares of preferred stock, par value $.001 per share, 5,000,000 of which are designated as “Series B Convertible Preferred Stock” of which 4,460,429 are issued and outstanding. As of the date hereof, 15,000,000 shares of common stock are reserved for issuance upon exercise of stock options granted or to be granted under the Company’s Stock Incentive Plans. As of the date hereof there are outstanding warrants to purchase 5,942,272 shares of common stock and outstanding warrants to purchase 446,023 shares of Series B Convertible Preferred Stock.

2.4 Issuance of Shares . The shares of Conversion Stock, when issued, sold and delivered in accordance with the terms of this Agreement, and the shares of Common Stock issuable pursuant to the Warrant, when issued, sold and delivered in accordance with the terms of the Warrant, will be duly authorized, validly issued, fully-paid and nonassesable.

2.5 Private Offering. Assuming the correctness of the representations and warranties of Oxenreiter set forth in Section 3 hereof, the issuance of the Conversion Stock and the Warrant is exempt from registration under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the “ Securities Act ”). Neither the Company nor any person acting on behalf of the Company has offered or sold the Conversion Stock or the Warrant by any form of general solicitation or general advertising.

3. REPRESENTATIONS AND WARRANTIES OF OXENREITER . Oxenreiter hereby represents and warrants to the Company, as of the date hereof, as follows:

3.1 Authorization . Oxenreiter has the requisite legal power and authority to enter into this Agreement and this Agreement constitutes a valid and legally binding obligation of Oxenreiter, except as the same may be limited by bankruptcy, insolvency, moratorium or other laws of general application affecting the enforcement of creditors’ rights.

3.2 Conversion Stock and Warrant Not Registered; Reliance Upon Oxenreiter’s Representations . Oxenreiter understands and acknowledges (i) that the Conversion Stock and the Warrant are not registered or qualified under any federal, foreign or state securities laws, (ii) that the Conversion Stock and the Warrant are being issued to Oxenreiter on the ground that the issuance of securities hereunder is exempt from registration under all applicable securities laws pursuant to exemptions thereunder, and (iii) that the Company’s reliance on such exemptions is predicated on Oxenreiter’s representations set forth herein.

3.3 Accredited Investor . Oxenreiter is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act, as presently in effect.

3.4 Restricted Securities . Oxenreiter understands that the Conversion Stock and the Warrant constitute restricted securities under applicable securities laws and may not be resold or transferred unless they are first registered on qualified under applicable securities laws or unless an exemption from such registration or qualification is available. Accordingly, Oxenreiter hereby acknowledges that he is prepared to hold the Conversion Stock and the Warrant for an indefinite period of time, until resale is permitted under applicable securities laws.

3.5 Experience; Risk . Oxenreiter has such knowledge and experience in financial and business matters that Oxenreiter is capable of evaluating the merits and risks of the acquisition of the Conversion Stock and the Warrant and of protecting Oxenreiter’s interests in connection therewith. Oxenreiter is able to fend for himself in the transactions contemplated by this Agreement and has the ability to bear the economic risk of the investment, including complete loss of the investment.

3.6 Investment . Oxenreiter is acquiring the Conversion Stock and the Warrant for investment for his own account, not as a nominee or agent and not with a view to, or for resale in connection with any distribution thereof, and Oxenreiter has no present intention of selling, granting any participation in, or otherwise distributing the same.

4. RESTRICTED SECURITIES.

4.1 Restrictive Legends .

(a) Unless and until otherwise permitted by this Section, each certificate for Conversion Stock issued to Oxenreiter or any subsequent transferee of any such certificate shall be stamped or otherwise imprinted with a legend of substantially the following form:

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY OTHER APPLICABLE FEDERAL OR STATE SECURITIES LAWS, AND THUS MAY NOT BE TRANSFERRED UNLESS REGISTERED UNDER THE SECURITIES ACT OR 1933 AND SUCH OTHER LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.”

(b) In addition to the legend required by this Section 4.1, each certificate for Company shares issued under or pursuant to this Agreement to Oxenreiter or any subsequent transferee shall be stamped or otherwise imprinted with any legend required pursuant to applicable state corporation and securities laws.

4.2 Transfer . The Company may decline to acknowledge or register a transfer of any Company shares bearing any legend pursuant to Section 4.1, and may instruct any transfer agent for its Company shares to decline the same, unless the Company is reasonably satisfied that the Company shares being transferred have been registered or are exempt from registration under applicable securities laws.

4.3 Removal of Legends . Whenever the legend described in Section 4.1 shall no longer be required by law, the holder of any particular Company shares bearing such legends shall be entitled to receive from the Company, without expense to such holder, one or more new certificates for such particular Company shares not bearing restrictive legends pursuant to Section 4.1 hereof.

5. MISCELLANEOUS .

5.1 Further Instruments and Actions . The parties agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.

5.2 Expenses . Each party hereto agrees to pay its expenses incurred in connection with this Agreement and the documents and transactions contemplated herein.

5.3 Notices . All notices and other communications required or permitted hereunder shall be given in writing and shall be delivered by personal delivery, facsimile, electronic mail, overnight delivery service, or U.S. mail service, addressed as follows:

The Company :

Geospatial Holdings, Inc.

229 Howes Run Road

Sarver, PA 16055

Attn: Mark Smith, Chief Executive Officer

T: 724-353-3400

F: 724-353-3049

Email: mark@geospatialcorporation.com

Oxenreiter :

Thomas R. Oxenreiter

10101 Clubhouse Road

Presto, PA 15142

T: 412-206-9362

Email: toxenreiter@geospatialcorporation.com

Any notice or other communication delivered in accordance with this Section 5 shall be deemed to have been given upon actual receipt or refusal of such delivery.

5.4 Governing Law . This Agreement shall be governed in all respects by the laws of the Commonwealth of Pennsylvania without giving effect to the conflicts of laws principles hereof.

5.5 Successors and Assigns; Assignment . No party may assign this Agreement or any rights or obligations hereunder without the prior written consent of the other party, which consent may not be unreasonably withheld, including by merger or consolidation. Subject to the preceding, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the parties hereto and their respective successors and assigns.

5.6 Amendments and Waivers . This Agreement may only be amended with the written consent of the Company and Oxenreiter, or the successors or permitted assigns of the foregoing, and no oral waiver or amendment shall be effective under any circumstances whatsoever.

5.7 Counterparts . This Agreement may be signed in two or more counterparts. Signatures and delivery may be transmitted via facsimile or email.

5.8 Entire Agreement . This Agreement, the attached exhibits and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and they supersede, merge and render void every other prior written and/or oral understanding or agreement among or between the parties hereto relating to the subjects hereof.

5.9 Severability . The invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity, legality or enforceability of the remainder hereof in such jurisdiction or the validity, legality or enforceability hereof, including any such provisions, in any other jurisdiction, it being intended that all rights and obligation of the parties hereunder shall be enforceable to the fullest extent permitted by law.

5.10 Consent to Jurisdiction . Each of the parties hereby irrevocably acknowledges and consent that nay legal action or proceeding brought with respect to any of the obligations arising under or relating to this Agreement shall be brought in the courts of the Commonwealth of Pennsylvania or if it has or can acquire jurisdiction, in the United States District Court for the Western District of Pennsylvania, as the party bringing such action or proceeding may elect, and each of the parties hereby irrevocably submits to and accepts with regard to any such action or proceeding, for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts. Each party hereby further irrevocably waives any claim that any such courts lack jurisdiction over such party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Agreement or the transactions contemplated hereby brought in any of the aforesaid courts, that any such court lacks jurisdiction over such party.

5.12 Titles and Subtitles . The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

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

COMPANY:		OXENREITER:

GEOSPATIAL HOLDINGS, INC.

By:	/s/ Mark A. Smith	/s/ Thomas R. Oxenreiter
	Mark A. Smith, CEO	Thomas R. Oxenreiter

GMS:

GEOSPATIAL MAPPING SYSTEMS, INC.

By:	/s/ Mark A. Smith
	Mark A. Smith, CEO

EXHIBIT A

FORM OF WARRANT

See Attached

NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY BE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR (B) IN A TRANSACTION WHICH IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS.

Warrant Issue Date: August ____, 2013

COMMON STOCK PURCHASE WARRANT

For value received, Geospatial Holdings, Inc. (the “Company”), a Nevada corporation, hereby certifies that __________ (the “ Holder ”) or its permitted assign(s) is entitled to purchase from the Company, at any time or from time to time during the Exercise Period (as defined below), in whole or in part, shares of the Company’s Common Stock, par value $.001 per share (“ Common Stock ”), at a price per share equal to $0.25 (the “Exercise Price”). This Warrant is subject the following terms and conditions. This Warrant is issued pursuant to that certain Conversion Agreement dated as of August _____, 2013, by and between the Company, Geospatial Holdings, Inc. and the Holder (the “ Conversion Agreement ”). This Warrant is subject to the terms of the Conversion Agreement and the following additional terms and conditions.

1. Certain Definitions.

(a) “ Change in Control ” means any sale of capital stock of the Company or consolidation or merger of the Company with or into any other corporation or other entity or person, or any other corporate reorganization, in which the stockholders of the Company immediately prior to such sale, consolidation, merger or reorganization, do not hold at least a majority of the resulting or surviving corporation’s voting power immediately after such consolidation, merger or reorganization, or the sale, lease, or other disposition of all or substantially all of the assets of the Company.

(b) “ Exercise Period ” means the period commencing on the Warrant Issue Date and ending on the date that is the earliest to occur of (i) 5: 00 p.m. (prevailing local time at the principal executive office of the Company) on the fifth anniversary of the Warrant Issue Date, (ii) a Change in Control, or (iii) the closing of a Qualified Public Offering (as defined in the Certificate of Designation of Series B Preferred Stock of the Company).

2. Exercise of Warrant .

(a) The purchase rights represented by this Warrant are exercisable by the Holder, in whole or in part, during the Exercise Period by the surrender of this Warrant, with the form of Subscription Agreement attached hereto as Annex A duly completed and executed by the Holder, to the Company at its principal executive office, accompanied by payment in cash, in lawful money of the United States of America, including by certified or official bank check made payable to the order of the Company or by wire transfer of immediately available funds to an account designated by the Company, of an amount equal to the Exercise Price multiplied by the number of shares of Common Stock being purchased pursuant to such exercise of the Warrant.

(c) As soon as practicable after the exercise of this Warrant and payment of the Exercise Price, and in any event within 20 business days thereafter, the Company, at its expense, will cause to be issued in the name of and delivered to the Holder a certificate or certificates for the number of duly authorized, validly issued, fully paid and non-assessable shares of Common Stock to which the Holder shall be entitled upon such exercise, plus, in lieu of any fractional share to which the Holder would otherwise be entitled, cash in an amount determined in accordance with Section 3(d) hereof. The Company agrees that the shares so purchased shall be deemed to be issued to the Holder as the record owner of such shares as of the close of business on the date on which this Warrant shall have been surrendered and payment made for such shares as aforesaid.

3. Adjustments .

(a) Adjustments Generally . In order to prevent dilution of the rights granted hereunder in the specific circumstances contemplated by this Section 3, the Exercise Price shall be subject to adjustment from time to time in accordance with this Section 3. Upon each adjustment of the Exercise Price pursuant to this Section 3, the Holder shall thereafter be entitled to acquire upon exercise, at the Exercise Price resulting from such adjustment, the number of shares of Common Stock determined by (i) multiplying (A) the Exercise Price in effect immediately prior to such adjustment by (B) the number of shares of Common Stock issuable upon exercise hereof immediately prior to such adjustment, and (ii) dividing the product thereof by the Exercise Price resulting from such adjustment; provided that no such adjustments shall be made in the Exercise Price and/or the number of shares of Common Stock subject to this Warrant if the conversion ratio of the Common Stock already reflects such event.

(b) Subdivisions, Stock Dividends and Recapitalizations . In case the Company shall at any time subdivide its outstanding shares of Common Stock into a greater number of shares (including, without limitation, through any stock split effected by means of a dividend on the Common Stock which is payable in Common Stock), the Exercise Price in effect immediately prior to such subdivision shall be proportionately reduced, and, conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased, unless the conversion ratio of such Common Stock already reflects such event.

(c) Reorganization. Reclassification, Consolidation. Merger or Sale of Assets. If any capital reorganization or reclassification of the capital stock of the Company, or consolidation or merger of the Company with another corporation, or the sale of a significant amount of assets to another corporation shall be effected in such a way that (i) does not constitute a Change in Control, and (ii) holders of Common Stock shall be entitled to receive stock, securities, cash or other property with respect to or in exchange for Common Stock, then, as a condition of such reorganization, reclassification, consolidation, merger or sale, lawful and adequate provision shall be made whereby the Holder shall have the right to acquire and receive upon exercise of this Warrant such shares of stock, securities, cash or other property of the successor corporation that a holder of the shares deliverable upon exercise of this Warrant would have been entitled to receive in such reorganization, reclassification, consolidation, merger or sale if this Warrant had been exercised immediately before such reorganization, reclassification, consolidation, merger or sale. The foregoing provisions shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers or sales and to the stock or securities of any other corporation that are at the time receivable upon the exercise of this Warrant. In all events, appropriate adjustments (as determined by the Board of Directors of the Company) shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after the transaction, to the end that the provisions of this Warrant shall be applicable after that event, as near as reasonably may be, in relation to any shares or other property deliverable after that event upon exercise of this Warrant.

(d) Fractional Shares . The Company shall not issue fractions of shares of Common Stock upon exercise of this Warrant or scrip in lieu thereof. If any fraction of a share of Common Stock would, except for the provisions of this Section 3(d), be issuable upon exercise of this Warrant, then the Company shall in lieu thereof pay to the person entitled thereto an amount in cash equal to the current value of such fraction, calculated to the nearest one-hundredth (1/100) of a share, to be computed on the basis of the fair market value per share as determined in good faith by the Board of Directors of the Company.

(e) Certificate as to Adjustments . Whenever the Exercise Price shall be adjusted as provided in Section 3 hereof, the Company shall promptly compute such adjustment and furnish to the Holder a certificate setting forth such adjustment and showing in reasonable detail the facts requiring such adjustment, the Exercise Price that will be effective after such adjustment and the number of shares and the amount, if any, of other property that at the time would be received upon the exercise of this Warrant.

4 Reservation of Stock Issuable on Exercise of Warrants . The Company shall at all times reserve and keep available out of its authorized but unissued stock, solely for the issuance and delivery upon the exercise of this Warrant, such number of its duly authorized shares of Common Stock as from time to time shall be issuable upon the exercise of this Warrant. All of the shares of Common Stock issuable upon exercise of this Warrant, when issued and delivered in accordance with the terms hereof and thereof, will be duly authorized, validly issued, fully paid and non-assessable, subject to no lien or other encumbrance other than restrictions on transfer arising under applicable securities laws and restrictions imposed by Section 6(a) hereof and the Agreements to which reference is made in Section 6(b) hereof.

5. Replacement of Warrant . Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and (in the case of loss, theft or destruction) upon delivery of an indemnity agreement reasonably satisfactory to the Company (with surety if reasonably required), or (in the case of mutilation) upon surrender and cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of like tenor and amount.

6. Negotiability . This Warrant is issued upon the following terms:

(a) Transfer . By acceptance hereof, the Holder acknowledges and agrees that the Holder is acquiring the Warrant and the shares of Common Stock issuable upon exercise hereof for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distribution thereof, and Holder has no present intention of selling, granting any participation in, or otherwise distributing the same.

(b) Agreements . As a condition to the Company’s obligation to issue shares of Common Stock upon exercise hereof, the Holder shall execute the Subscription Agreement attached hereto as Annex A.

(c) Transfer Taxes . The Company shall not be required to pay any federal or state transfer tax or charge that may be payable in respect of any transfer involved in the transfer or delivery of this Warrant or the issuance or conversion or delivery of certificates for Common Stock in a name other than that of the Holder or to issue or deliver any certificates for Common Stock upon the exercise of this Warrant until any and all such taxes and charges shall have been paid by the Holder or until it has been established to the Company’s reasonable satisfaction that no such tax or charge is due.

(d) Compliance with Securities Laws. The Holder, by acceptance hereof, acknowledges that this Warrant and the shares of Common Stock to be issued upon exercise hereof are being acquired solely for the Holder’s own account and not as a nominee for any other party, and for investment, and that the Holder will not offer, sell or otherwise dispose of this Warrant or any shares of Common Stock to be issued upon exercise hereof except under circumstances that will not result in a violation of applicable federal and state securities laws.

7. Subdivision of Rights . Subject to Section 6, this Warrant (as well as any new Warrants issued pursuant to the provisions of this Section 7) is exchangeable, upon the surrender hereof by the Holder, at the principal executive office of the Company for any number of new Warrants of like tenor and date representing in the aggregate the right to subscribe for and purchase the number of shares of Common Stock of the Company which may be subscribed for and purchased hereunder.

8. Miscellaneous .

(a) Notices . Any notice or other communication required or permitted to be given hereunder shall be in writing and given as provided in the Conversion Agreement.

(b) Books of the Company . The Company may treat the holder hereof as appearing on the Company’s books at any time as the holder for all purposes.

(c) Headings . The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect the meaning hereof.

(d) Amendment; Waiver . This Warrant and any term hereof may be amended, waived, discharged or terminated only by an instrument in writing signed by the party against whom enforcement of such amendment, waiver, discharge or termination is sought. No waivers of any term, condition or provision of this Warrant, in any one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term, condition or provision.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed and delivered by its authorized officer, as of the date first above written.

	Geospatial Holdings,Inc.

	By:
		Mark A. Smith
		Chief Executive Officer

ANNEX A

SUBSCRIPTION AGREEMENT

Date: ____________________

To: ____________________

____________________

The undersigned (the “ Purchaser ”), pursuant to the provisions set forth in the attached Warrant, hereby irrevocably elects (a) to purchase shares of Common Stock (the “ Warrant Shares ”) covered by such Warrant and herewith makes payment of $ __________, representing the full purchase price for such shares at the price per share provided for in such Warrant or (b) to exercise the Warrant with respect to __________ shares of Common Stock, pursuant to Section 2(b) of the Warrant [STRIKE (a) OR (b) AS APPLICABLE].

Purchaser represents and warrants to the Company as follows:

2. Experience; Risk . Purchaser has such knowledge and experience in financial and business matters that Purchaser is capable of evaluating the merits and risks of the purchase of the Warrant Shares and of protecting Purchaser’s interests in connection therewith. Purchaser is able to fend for itself in the transactions contemplated by this Agreement and has the ability to bear the economic risk of the investment, including complete loss of the investment.

3. Investment . Purchaser is acquiring the Warrant Shares for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distribution thereof, and Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same. Purchaser understands that the Warrant Shares have not been registered under the Securities Act and applicable state securities laws (collectively, the “Acts”) by reason of a specific exemption from the registration provisions of the Acts which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of Purchaser’s representations as expressed herein.

4. Information . Purchaser has been furnished with all information which it deems necessary to evaluate the merits and risks of purchasing the Warrant Shares and has had the opportunity to ask questions concerning the Warrant Shares and the Company and all questions posed have been answered to its satisfaction. Purchaser has been given the opportunity to obtain any additional information it deems necessary to verify the accuracy of any information obtained concerning the Warrant Shares and the Company. Purchaser has such knowledge and experience in financial and business matters that it is able to evaluate the merits and risks of purchasing the Warrant Shares and to make an informed decision relating thereto.

5. Restricted Securities; Restrictions on Transfer . Purchaser understands that the Warrant Shares will be “restricted securities” under applicable securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations the Warrant Shares may be resold without registration under the Acts only in certain limited circumstances. Purchaser acknowledges that Warrant Shares must be held indefinitely unless subsequently registered under the Acts or an exemption from such registration is available. To the extent that Purchaser is not already a party to such agreements, Purchaser agrees to execute and deliver a counterpart signature page, and become a party, to such stockholder and registration rights agreements as are then in effect by and among the Company and its stockholders.

7. Accredited Investor . Purchaser is an “accredited investor” within the meaning of Rule 501 promulgated under the Securities Act. The Purchaser has considered the Federal and state income tax implications of the exercise of the Warrant and the purchase and subsequent sale of the Warrant Shares.

8. Residence . If Purchaser is an individual, then Purchaser resides in the state or province identified in the address of Purchaser set forth below; if Purchaser is a partnership, corporation, limited liability company or other entity, then the office or offices of Purchaser in which its investment decision was made is located at the address or addresses of Purchaser set forth below.


	Signature

	Print name:

	Address:

NOTICE OF TRANSFER

[To be signed only upon transfer of Warrant]

Name of Assignee

Address

No. of Shares

and appoints __________ attorney to transfer said right on the warrant register of __________ with full power of substitution in the premises.

Dated: __________


	(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)

	Address:

EXHIBIT B

FORM OF REGISTRATION RIGHTS AGREEMENT

See Attached

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered into as of this __ day of August, 2013 (the “ Effective Date ”) by and between Geospatial Holdings, Inc., a Nevada corporation (the “ Company ”), and Thomas R. Oxenreiter, an individual resident of Presto, Pennsylvania (“Oxenreiter”).

AGREEMENT

WHEREAS, the Company, Geospatial Mapping Systems, Inc. and Oxenreiter are parties to a Conversion Agreement dated the date hereof (the “ Conversion Agreement ”); and

WHEREAS, the Conversion Agreement requires that, upon execution of the Conversion Agreement, Geospatial and Oxenreiter will enter into this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions . As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

“ Agreement ” has the meaning set forth in the preamble.

“ Board ” means the board of directors of the Company.

“ Common Stock ” means the common stock, par value $.001 per share, of the Company.

“ Company ” has the meaning set forth in the preamble.

“ Contractual Obligation ” means as to any Person, any material provision of any security issued by such Person or any material provision of any agreement, lease of real or personal property, undertaking, contract, indenture, mortgage, deed of trust or other instrument including, without limitation, the organizational or governing documents of such Person, to which such Person is a party or by which it or any of its property is bound.

“ Effective Date ” has the meaning set forth in the preamble.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Governmental Authority ” means any court, tribunal, arbitrator, authority, agency, commission, official or other instrumentality of any government of any nation, state, city, locality or other political subdivision.

“ Holder ” means (i) any person owning of record Registrable Shares that have not been sold to the public or (ii) any assignee of record of such Registrable Shares in accordance with Section 4.9 hereof.

“ Initial Offering ” means the Company’s first firm commitment underwritten public offering of its Common Stock registered under the Securities Act.

“ Person ” means any individual, firm, corporation, partnership, trust, incorporated or unincorporated association, joint venture, joint stock company, Governmental Authority or other entity of any kind, and shall include any successor (by merger or otherwise) of such entity.

’ ‘Register ,” “ registered ” and “ registration ” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

“ Registrable Shares ” means (a) Common Stock of the Company issued to Oxenreiter pursuant to the Conversion Agreement; (b) any other shares of Common Stock hereafter owned or held by Oxenreiter; and (c) any “Registrable Shares” as defined in any other agreement pursuant to which the Company has granted registration rights. Notwithstanding the foregoing, Registrable Shares shall not include any securities sold by a Person to the public either pursuant to a registration statement or Securities Act Rule 144 or sold in a private transaction in which the transferor’s rights pursuant to Section IV of this Agreement are not assigned.

“ Registration Expenses ” means all expenses incurred by the Company in complying with Sections 4.1, 4.2 and 4.3 hereof, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for the Company, reasonable fees and disbursements of a single special counsel for the Holders, blue sky fees and expenses and the expense of any special audits incident to or required by any such registration.

“ Requirements of Law ” means, as to any Person, the provisions of the charter and bylaws or other organizational or governing documents of such Person, and any law, treaty, rule, regulation, right, privilege, qualification, license or franchise, order,judgment, or determination of an arbitrator or a court or other Governmental Authority applicable to or binding upon such Person or any of its property (or to which such Person or any of its property is subject) or applicable to any or all of the transactions contemplated by, or referred to in, this Agreement.

“ Restricted Period” has the meaning set forth in Section 4.9 .

“ SEC ” or “ Commission ” means the Securities and Exchange Commission.

“ SEC Reports ” shall mean all reports required to be filed with the SEC under the Securities Act and the Exchange Act.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Selling Expenses ” means all underwriting discounts and selling commissions applicable to the sale.

“ Violation ” has the meaning set forth in Section 4.7(a).

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to Oxenreiter follows:

2.1 Authorization; Binding Effect . The Company has full power and authority to enter into and perform its obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other Jaws of general application affecting enforcement of creditors’ rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

2.2 Non-contravention . The execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby, do not and will not (i) violate any Requirements of Law applicable to the Company, or (ii) result in a material breach or default under any of the Contractual Obligations of the Company, or under any order, writ, judgment, injunction, decree, determination or award of any Governmental Authority, in each case applicable to the Company or its properties.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF OXENREITER

Oxenreiter hereby represents and warrants as of the date hereof as follows:

3.1 Authorization; Binding Effect . Oxenreiter has the requisite legal power and authority to enter into and perform his obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of Oxenreiter, enforceable against Oxenreiter in accordance with its terms, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

3.2 Non-contravention . The execution, delivery and performance of this Agreement by Oxenreiter, and the consummation of the transactions contemplated hereby, do not and will not (a) violate any Requirements of Law applicable to Oxenreiter, or (b) result in a material breach or default under any of the Contractual Obligations of Oxenreiter, or under any order, writ, judgment, injunction, decree, determination or award of any Governmental Authority, in each case applicable to Oxenreiter or Oxenreiter’s properties.

ARTICLE IV

REGISTRATION; COVENANTS OF THE COMPANY

4.2 Piggyback Registration . The Company shall notify all Holders of Registrable Shares in writing at least thirty (30) days prior to the filing of any registration statement under the Securities Act for purposes of a public offering of securities of the Company (including, but not limited to, registration statements relating to secondary offerings of securities of the Company, but excluding registration statements relating to employee benefit plans or with respect to corporate reorganizations or other transactions under Rule 145 of the Securities Act), which notice will specify the proposed offering price, the kind and number of securities proposed to be registered, the distribution arrangements and such other information that at the time would be appropriate to include in such notice, and will afford each such Holder an opportunity to include in such registration statement all or part of such Registrable Shares held by such Holder on terms and conditions at least as favorable as those applicable to the securities to be sold by the Company and by any other person thereunder. Each Holder desiring to include in any such registration statement all or any part of the Registrable Shares held by it shall, within fifteen ( 15) days after the above-described notice from the Company, so notify the Company in writing. If a Holder decides not to include some or all of its Registrable Shares in any registration statement thereafter filed by the Company or decides to withdraw its Registrable Shares from any underwriting or registration pursuant to Section 4.1 , such Holder shall nevertheless continue to have the right to include any Registrable Shares in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein

a. Underwriting . If the registration statement under which the Company gives notice under this Section 4. 2 is for an underwritten offering, the Company shall so advise the Holders of Registrable Shares. In such event, the right of any such Holder to be included in a registration pursuant to this Section 4.2 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Shares in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Shares through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision of this Agreement, if the underwriter determines in good faith that marketing factors require a limitation of the number of securities to be underwritten and advises the Holders of Registrable Shares in writing, the number of shares that may be included in the underwriting shall be allocated, first, to the Company; second, to the Holders on a pro rata basis based on the total number of Registrable Shares held by the Holders; and third, to any holder of securities of the Company (other than a Holder) on a pro rata basis. In making any such reduction, all shares held by employees of the Company which are not Registrable Shares shall first be excluded. No such reduction shall (i) reduce the securities being offered by the Company for its own account to be included in the registration and underwriting or (ii) reduce the amount of Registrable Shares of the selling Holders included in the registration below thirty three and one-third percent (33 1/3%) of the total amount of securities included in such registration, unless such offering is the Initial Offering, in which event any or all of the Registrable Shares of the Holders may be excluded. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the underwriter, delivered at least ten (10) business days prior to the effective date of the registration statement. Any Registrable Shares excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder which is a partnership, limited liability company or corporation, the partners and members, retired partners and members and shareholders of such Holder, or the estates and family members of any such partners and members and retired partners and members and any trusts for the benefit of any of the foregoing person shall be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “ Holder, ” as defined in this sentence.

b. Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 4.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4.4 hereof.

a. promptly give written notice of the proposed registration, and any related qualification or compliance, to all other Holders of Registrable Securities; and

b. as soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder’s or Holders’ Registrable Shares as are specified in such request, together with all or such portion of the Registrable Shares of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 4.3:

(i) if Form S-3 is not available for such offering by the Holders, or

(iii) if the Company shall furnish to the Holders a certificate signed by the chairman of the Board of the Company or its chief executive officer stating that in the good faith judgment of the Board of the Company, it would be seriously detrimental to the Company and its shareholders for such Form S-3 registration to be effected at such time, in which event the Company shall have the right to defer the filing of the Form S-3 registration statement for a period of not more than ninety (90) days after receipt of the request of the Holder or Holders under this Section 4.3 ; provided, that such right to delay a request shall be exercised by the Company not more than once in any twelve (12) month period, or

(iv) if the Company has, within the twelve (12) month period preceding the date of such request, already effected one (1) registration on Form S-3 for the Holders pursuant to this Section 4.3 .

c. Subject to the foregoing, the Company shall file a Form S-3 registration statement covering the Registrable Shares and other securities so requested to be registered as soon as practicable after receipt of the request or requests of the Holders. Registrations effected pursuant to this Section 4.3 shall not be counted as demands for registration or registrations effected pursuant to Section 4.1 or Section 4.2 , respectively.

4.4 Expenses of Registration . Except as specifically provided herein, all Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to Sections 4.1. 4.2 or 4.3 herein shall be borne by the Company. All Selling Expenses applicable to Registrable Shares sold by Holders incurred in connection with any registrations hereunder shall be borne by the Holders of the securities so registered pro rata on the basis of the number of shares so registered.

4.5 Obligations of the Company . Whenever required to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

a. Prepare and file with the SEC a registration statement with respect to such Registrable Shares and use its best efforts to cause such registration statement to become effective as soon as possible, and in any event within thirty (30) days of the date on which the obligation to effect such registration arises, and, upon the request of the Holders of a majority of the Registrable Shares registered thereunder, keep such registration statement effective for up to one hundred eighty (180) days or, if a shelf registration pursuant to Securities Act Rule 415, until the Holder or Holders have completed the distribution related thereto.

e. In the event of any underwritten public offering, enter into and perfonu its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement, provided that such underwriting agreement shall not provide for indemnification or contribution obligations on the part of the Holders greater than the obligations set forth in Sections 4.7 (b) and (d).

f. Notify each Holder of Registrable Shares covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and correct such misrepresentation or omission as expeditiously as reasonably possible.

g. Use its best efforts to furnish, on the date that such Registrable Shares are delivered to the underwriters for sale, if such securities are being sold through underwriters, (i) an opinion, dated as of such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters, if any, and (ii) to the Holders requesting registration of Registrable Securities, a letter dated as of such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering addressed to the underwriters.

h. Cooperate and assist in any filings to be made with the Financial Industry Regulatory Authority, Inc.

i. Cause all such Registrable Shares to be listed on each securities exchange on which similar securities issued by the Company are then listed, or cause such Registrable Shares to be authorized for trading on the Nasdaq Stock Market if any similar securities issued by the Company are then so authorized, if requested by the Holders of a majority of such Registrable Securities.

k. In connection with an underwritten offering, to the extent requested by the managing underwriters or Holders, participate in and support customary efforts to sell the Registrable Shares in the offering; including without limitation, participating in “road shows.”

4.6 Delay of Registration; Furnishing Information . It shall be a condition precedent to the obligations of the Company to take any action pursuant to Section 4.1, 4.2 or 4.3 that the selling Holders shall furnish to the Company such information regarding themselves, the Registrable Shares held by them and the intended method of disposition of such securities as shall be required to effect the registration of their Registrable Securities.

4.7 Indemnification . In the event any Registrable Shares are included in a registration statement under Section 4.1, 4.2 or 4.3:

a. To the extent permitted by law, the Company will indemnify and hold harmless each Holder, the partners, stockholders, members, officers and directors of each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages, or liabilities Goint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”) by the Company: (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities Jaw or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law in connection with the offering covered by such registration statement; and the Company will pay as incurred to each such Holder, partner, stockholder, member, officer, director, underwriter or controlling person any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the indemnity agreement contained in this Section 4.7(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by such Holder, partner, officer, director, underwriter or controlling person of such Holder.

if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder under an instrument duly executed by such Holder and stated to be specifically for use in connection with such registration; and each such Holder will pay as incurred any legal or other expenses reasonably incurred by the Company or any such director, officer, controlling person, underwriter or other Holder, or the partners, stockholders, members, officers and directors of such other Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, in connection with investigating or defending any such loss, claim, damage, liability or action if it is judicially determined that there was such a Violation; provided, however, that the indemnity agreement contained in this Section 4.7(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld; provided further, that in no event shall any indemnity under this Section 4.7 exceed the proceeds from the offering received by such Holder; provided further , that any payments will be repaid to each such Holder if the Company acted recklessly.

c. Promptly after receipt by an indemnified party under this Section 4.7 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 4.7 , deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall have the right to retain its own counsel, with the fees and expenses to be paid by the indemnifying party, if in the reasonable opinion of counsel representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if (and only to the extent) materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 4.7, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 4.7 .

d. If the indemnification provided for in this Section 4.7 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any losses, claims, damages or liabilities referred to herein, the indemnifying party, in lieu of indemnifying such indemnified party thereunder, shall to the extent permitted by applicable law contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the Violation(s) that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and of the indemnified party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; provided, that in no event shall any contribution by a Holder hereunder exceed the proceeds from the offering received by such Holder.

e. The obligations of the Company and Holders under this Section 4.7 shall survive completion of any offering of Registrable Shares in a registration statement and the termination of this Agreement. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.

4.8 Assignment of Registration Rights. The rights to cause the Company to register Registrable Shares pursuant to this Article IV may be transferred or assigned by a Holder to a transferee or assignee of Registrable Shares which (a) is a subsidiary, parent, stockholder, general partner, limited partner, retired partner, member, retired member or Affiliate of a Holder, (a) is a Holder’s Immediate Family member or an estate or trust of or for the benefit of an individual Holder, or (c) acquires at least twenty percent (20%) of the Registrable Shares held by such Holder; provided, however, (i) the transferor shall, within ten (10) days after such transfer, furnish to the Company written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (ii) such transferee shall become a party to this Agreement.

4.9 “Market Stand-Off” Agreement; Agreement to Furnish Information. Each Holder hereby agrees that such Holder shall, if requested by the underwriter of any underwritten public offering of the Company’s Common Stock, agree with such underwriter not to sell, transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale of, any Common Stock (or other securities) of the Company held by such Holder (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company (the “ Restricted Period ”) not to exceed ninety (90) days following the effective date of any registration statement of the Company filed under the Securities Act in connection with the Initial Offering; provided that such agreements shall not apply to Registrable Shares included in such registration statement or sales or similar transactions effected pursuant to a valid exemption from the registration requirements of the Securities Act. Each Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other securities) of the Company, each Holder shall provide, within ten (10) days of such request, such information concerning such Holder as may be reasonably requested by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section 4.9 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of the Restricted Period.

4.10 Information Regarding the Company . With a view to making available to Oxenreiter the benefits of certain rules and regulations of the SEC which may permit the sale of the Shares to the public without registration, the Company agrees to:

b. So long as Oxenreiter owns any Shares, furnish to Oxenreiter forthwith upon request: (i) a written statement by the Company as to its compliance with the reporting requirements of the Exchange Act (at any time after it has become subject to such reporting requirements); (ii) a copy of the most recent annual or quarterly report of the Company; and (iii) such other reports and documents as Oxenreiter may reasonably request in availing itself of any rule or regulation of the SEC allowing it to sell the Notes without registration.

ARTICLE V

GENERAL PROVISIONS

5.1 Indemnification . Oxenreiter agrees to indemnify and hold harmless the Company, its officers, managers, affiliates, counsel, agents and each other Person, if any, who controls or is controlled by it, within the meaning of Section 15 of the Securities Act, against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all expenses reasonably incurred in investigating, preparing or defending against any litigation commenced or threatened or any claim whatsoever) arising out of or based upon any false representation or warranty or breach or failure by Oxenreiter to comply with any covenant or agreement made by Oxenreiter herein or in any other document furnished by Oxenreiter to any of the foregoing in connection with this transaction.

5.2 Amendment . This Agreement may be amended, modified or supplemented at any time by the parties hereto only by an instrument in writing signed on behalf of each of the parties hereto. No agreement made through the use of electronic records or electronic signatures, as those terms are used in the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Sec. 7001 et. seq., shall be enforceable or binding on either party hereto. Notwithstanding the previous sentence, facsimile signatures, telecopied signatures, or copies of signatures in PDF format sent by e-mail, will constitute a sufficient form of writing for purposes of this Section 5.2 and Section 5.3 .

5.3 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

5.4 Headings . The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

5.5 GOVERNING LAW . THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

5.6 Severability . If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired.

5.7 Entire Agreement; Waivers . This Agreement, together with the Settlement Agreement, is intended by the parties as a final expression of their agreement and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth herein and in the Conversion Agreement. This Agreement and the Conversion Agreement supersede all prior agreements and understandings between the parties with respect to such subject matter. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

5.8 Further Assurances . Each of the parties shall execute such documents and perform such further acts (including, without limitation, obtaining any consents, exemptions, authorizations, or other actions by, or giving any notices to, or making any filings with, any Governmental Authority or any other Person) as may be reasonably required or desirable to carry out or to perform the provisions of this Agreement.

5.9 Notices . All notices or other communications given or made hereunder shall be in writing and shall be delivered or mailed by registered or first class mail, postage prepaid, or express overnight courier service, to the address set forth in the Conversion Agreement.

(Signature Page Follows)

IN WITNESS WHEREOF, the Company and Oxenreiter have executed this Agreement as of __________, 2013.

	GEOSPATIAL HOLDINGS, INC.

	By:
		Mark A. Smith, CEO


		Thomas R. Oxenreiter

Geospatial Corporation S-1

EXHIBIT 10.14

EMPLOYMENT AGREEMENT

THIS AGREEMENT (“Agreement”), by and between GEOSPATIAL CORPORATION, a Nevada Corporation (the “Company”), and Thomas R. Oxenreiter (the “Executive”) is entered into as of OCTOBER 18th, 2013 (the “Employment Date”). In consideration of the mutual covenants set forth herein, the Company and the Executive hereby agree as follows:

1. Employment. The Company hereby agrees to employ the Executive, and the Executive agrees to continue to serve the Company, in the capacities described in Section 3 of this Agreement, during the Period of Employment (as defined in Section 2 of this Agreement), in accordance with the terms and conditions of this Agreement.

2. Period of Employment. The term “Period of Employment” shall mean the period which commenced on the Employment Date and, unless earlier terminated pursuant to Section 6, ends on October 18, 2016; provided, however that the Period of Employment shall automatically be extended on a day-by-day and shall always be thirty-six (36) months unless either the Company or the Executive shall have terminated this automatic extension provision by giving written notice to the other.

3. Duties During the Period of Employment.

3.1 Duties. During the Period of Employment, the Executive shall be employed as the Chief Financial Officer of the Company. The Executive shall report directly to the Chief Executive Officer and shall perform such duties as the Executive shall reasonably be directed to perform by the CEO.

3.2 Scope. Throughout the Period of Employment, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive shall devote substantially all of his business time and attention to the business and affairs of the Company. It shall not be a violation of this Agreement for the Executive to (i) serve on corporate, civic or charitable boards or committees, (ii) deliver lectures, fulfill speaking engagements or teach occasional courses or seminars at educational institutions, or (iii) manage personal and/or family investments and engage in any other activities, so long as such activities do not interfere, in any significant respect, with the Executive’s responsibilities hereunder or otherwise violate this Agreement.

4. Salary.

4.1 During the Period of Employment, the Executive’s Base Salary shall initially be at the rate of One Hundred Seventy-Five Thousand Dollars ($175,000) per year (the “Base Salary”). The Executive’s Base Salary shall be paid in accordance with the Company’s standard payroll practice. The Base Salary shall be reviewed by the Company’s Board of Directors or a committee of directors established by the Board of Directors having responsibility for compensation matters (in either case, the “Board”) as soon as practicable after the end of each fiscal year during the Period of Employment. Based on such reviews, the Board may increase, but shall not decrease the Base Salary. Any increase in Base Salary shall not serve to limit or reduce any other obligation of the Company under this Agreement.

4.2 Annual Bonuses.

4.2.1 Beginning with the Company’s fiscal year commencing on January 1st, 2014 (the “Initial Year”), the Executive shall participate in each annual and long-term incentive compensation plan established by the Board for executive officers of the Company (“Executive Compensation Plans”). The performance measures applicable to the Executive’s bonus opportunity for each fiscal year of the Company during the Period of Employment shall be set by reasonable good faith agreement of the Board and the Executive.

4.2.2 As soon as practicable after the end of the Initial Year and each fiscal year thereafter during the Period of Employment, the Board shall review the Executive’s performance under this Agreement as part of the Executive’s participation in the Executive Compensation Plans as in effect from time to time. The performance measures and the Target Bonus Amount applicable to the Executive’s bonus opportunity for each fiscal year of the Company, during the Period of Employment shall be established by the Board subject to Section 4.2.3 below. The Executive shall be paid his annual bonus, if any, no later than the date on which other senior executives of the Company are paid their annual bonuses. The Board may in its discretion, award the Executive bonuses in addition to those provided under any plans referred to above.

5. Other Executive Benefits.

5.2 Benefit Plans. The Executive and his eligible family members shall be entitled, subject to any normally applicable waiting periods and eligibility criteria, to participate, on terms no less favorable to the Executive than the terms offered to other senior executives of the Company, in a group and/or executive life, hospitalization or disability insurance plan, health program, pension, profit sharing, 401(k) and similar benefit plans (qualified, non-qualified and supplemental) or other fringe benefits (it being understood that items such as stock options and other equity awards are not fringe benefits) of the Company (collectively referred to as the “Benefits”). Anything contained herein to the contrary notwithstanding, the Benefits described herein shall not duplicate benefits made available to the Executive pursuant to any other provision of this Agreement.

5.4 Facilities and Support. During the Period of Employment, the Company shall provide the Executive with office space, furnishings and facilities, secretarial and administrative assistance, supplies and equipment appropriate to enable the Executive to perform has duties under this Agreement and commensurate, in quality and quantity, with the facilities and support resources provided to the other senior executives of the Company.

6. Termination.

6.1 Death. The Period of Employment shall terminate automatically upon the Executive’s death.

6.2 Disability. If the Company determines in good faith that the Disability of the Executive has occurred (pursuant to the definition of “Disability” set forth below), it may give to the Executive written notice of its intention to terminate the Executive’s employment. In such event, the Period of Employment shall terminate effective on the 30 th day after receipt by the Executive of such written notice given at any time after a period of 120 consecutive days of Disability or a period of 180 days of Disability within any 12 consecutive months, and, in either case, while such Disability is continuing (“Disability Effective Date”). The Disability Effective Date shall not occur if the Executive returns to performance of the Executive’s duties as contemplated in this Agreement within 30 days after receipt of such notice. For purposes of this Agreement, “Disability”) means the Executive’s inability to substantially perform his duties hereunder, with reasonable accommodation, as evidenced by a certificate signed either by a physician mutually acceptable to the Company and the Executive or, if the Company and the Executive cannot agree upon a physician, by a physician selected by agreement of a physician designated by the Company and a physician designated by the Executive; provided, however, that if such physicians cannot agree upon a third within 30 days, such third physician shall be designated by the American Arbitration Association. Until the Disability Effective Date, the Executive shall be entitled to all compensation and benefits provided for under Sections 4 and 5 hereof. It is understood that nothing in this section 6.2 shall serve to limit the Company’s obligations under Section 7.3.

6.3 By the Company for Cause. During the Period of Employment, the Company may terminate the Executive’s employment immediately for “Cause”. For purposes of this Agreement, “Cause” means (a) a material breach of this Agreement by the Executive or the gross neglect of the Executive’s duties hereunder (after the provision to the Executive by the Company of written notice reasonably specifying the breach and/or performance deficiency and thirty (30) days to cure such breach), (b) the Executive’s willful misconduct or gross negligence, which is demonstrably and materially injurious to the Company monetarily or otherwise, or (c) the Executive’s engaging in egregious misconduct involving serious moral turpitude to the extent that the Executive’s credibility and reputation no longer conforms to the standards of employees of the Company employed in a similar level or position. For purposes of this definition, no act or failure to act on the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interest of the Company. Any act or failure to act, based upon the advice of counsel for the Company shall be conclusively presumed to be done or omitted to be done, by the Executive in good faith and in the best interest of the Company. The foregoing not withstanding, the Company may not terminate the Executive’s employment for Cause, and any purported termination by the Company of Executive’s employment shall be presumed other than for Cause, unless (i) a determination that Cause exists is made and approved by at least a 3/4ths majority of the Board, (ii) the Executive is given at least seven (7) days written notice of the Board meeting called to make such determination, including written notice of the particulars purporting to establish Cause and (iii) the Executive and his legal counsel are given the opportunity to address that meeting.

6.4 By Executive for Good Reason. During the Period of Employment, the Executive’s employment hereunder may be terminated by the Executive for Good Reason upon (30) thirty days written notice. For purposes of this Agreement, “Good Reason” means, with the Executive’s written consent, (a) any material breach of this Agreement by the Company (after the provision to the Company by the Executive of written notice reasonably specifying the breach and/or performance deficiency and thirty (30) days to cure such breach), (b) the assignment to the Executive of duties that are inconsistent with those of the Chief Financial Officer of the Company or that materially impairs the Executive’s ability to perform his duties, or any other action by the Company that results in a significant diminution in the Executive’s position, authority, duties or responsibilities, to include without limitation the failure of the Executive to be named or elected to the Board (after the provision to the Company by the Executive of written notice reasonably specifying the basis upon which the Executive believes this clause has been violated and thirty (30) days to modify such assignment or change in his position), c) any relocation of the Executive’s office as assigned to him by the Company to a location more than forty (40) miles from Pittsburgh, Pennsylvania; (d) delivery by the Company of a notice discontinuing the automatic extension provision of Section 2 of this Agreement; or (e) any termination by the Executive during the period of six (6) months immediately following the occurrence of a Change of Control, as defined in Section 8, below.

6.6 Notice of Termination. Any termination by the Company or by the Executive shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 18.2 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (a) indicates the specific termination provision in this Agreement relied upon, (b) sets forth in reasonable detail, if applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (c) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the Date of Termination. The failure by the Executive or Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of the basis for termination shall not waive any right of such party hereunder or preclude such party from asserting such fact or circumstance in enforcing his or it rights hereunder.

7.4 Retirement. If the Executive voluntarily terminates his employment with the Company with or without Good Reason at any time after the Executive reaches the age of sixty-two (62) years old, he shall be treated as a retiree for purposes of all compensation and benefit plans, policies, arrangements and practices of the Company then in effect.

7.5.1 A lump sum cash payment in an amount equal to the number of months remaining in the Period of Employment multiplied by the sum of (a) 1/12 th of the Executive’s annual Base Salary on the Date of Termination (without regard to any reduction in Base Salary not approved by the Executive) and (b) 1/12 th of the annual bonus award to which the Executive would have been entitled calculated using the Target Bonus Amount for the year in which the Notice of Termination is given;

7.5.2 Immediate vesting in all equity awards granted to the Executive by the Company but not yet vested as of the Date of Termination;

7.5.3 Continued exercisability, for a period equal to their full original terms, for all vested options, whether previously vested or vesting under subsection 7.5.2;

7.5.4 For a period of 12 months after the Date of Termination, the Company shall continue health, prescription drug, dental, disability and life insurance benefits to the Executive and/or the Executive’s eligible family members at least equal to those which would have been provided to them in accordance with Section 5.2 of this Agreement if the Executive’s employment has not been terminated (provided that any benefits provided under this subsection 7.5.4 are subject to immediate early termination if the Executive becomes eligible to receive similar types of benefits through subsequent employment).

7.8 No Right to Set-Off. The Company shall have no right to reduce, because of any debt or financial obligation of the Executive to the Company, the amount of any compensation or benefit otherwise payable by the Company to the Executive under this Agreement or under any other plan, policy, arrangement or practice of the Company.

8. Change of Control. For purposes of this Agreement, a “Change of Control” shall be deemed to have occurred if:

8.3 Business Combination. Consummation of a reorganization, merger or consolidation, or sale or disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, more than fifty-five percent (55%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the entity resulting from such Business Combination (including, without limitation, an entity which, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company; or

8.4 Liquidation. Consummation of a complete liquidation or dissolution of the Company.

9. Taxes. In the event that the aggregate of all payment or benefits made or provided to, or that may be made or provided to, the Executive under this Agreement and under all other plans, programs and arrangements of the Company (the “Aggregate Payment”) is determined to constitute an “excess parachute payment,” as such term is defined in Section 280G(b) of the Internal Revenue Code, the Company shall pay to the Executive prior to the time any excise tax imposed by Section 4999 of the Internal Revenue Code (“Excise Tax”) is payable with respect to such Aggregate Payment, an additional amount which, after the imposition of all income and excise taxes thereon, is equal to the Excise Tax of the Aggregate Payment. The determination of whether the Aggregate Payment constitutes an excess parachute payment and, if so, the amount to be provided to the Executive and the time of payment pursuant to this Section 8 shall be made by an independent auditor (the “Auditor”) jointly selected by the Company and the Executive and paid by the Company. The Auditor shall be a nationally recognized United States public accounting firm which has not, during the two (2) years immediately preceding the date of it selection, acted in any way of behalf of the Company or any affiliate thereof. If the Executive and the Company cannot agree on the firm to serve as the Auditor, then the Executive and the Company shall each select one accounting firm and those two firms shall jointly select the accounting firm to serve as the Auditor. Notwithstanding the foregoing, in the event that the amount of the Executive’s Excise Tax liability is subsequently determined to be greater than the Excise Tax liability with respect to which any initial payment to the Executive under this Section 8 has been made, the Company shall pay to the Executive an additional amount (grossed up for all taxes), with respect to such additional Excise Tax (and any interest and penalties thereon) at the time and in the amount reasonably determined by the Auditor. Similarly, if the amount of the Executive’s Excise Tax liability is subsequently determined to be less than the Excise Tax Liability with respect to which any prior payment to the Executive has been made under this Section 8, the Executive shall refund to the Company the excess amount received, after reduction for any nonrefundable tax, penalties and/or interest incurred by the Executive in connection with the receipt of such excess, and such refund shall be paid promptly after the Executive has received any corresponding refund of excess Excise Tax paid to the Internal Revenue Service. The Executive and the Company shall cooperate with each other in connection with any proceeding or claim relating to the existence or amount of liability for Excise Tax, and all expenses incurred by the Executive in connection therewith shall be paid by the Company promptly upon notice of demand from the Executive.

10. Mitigation. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement. Except as otherwise set forth herein with respect to health, prescription drug, dental disability and life insurance benefits, any severance benefits payable to the Executive shall not be subject to reduction for any compensation received from other employment.

11. Indemnification. The Executive shall be indemnified by the Company against liability as an officer and director of the Company and any subsidiary or affiliate of the Company to the maximum extent permitted by applicable law. To the full extent permitted under the corporate governing documents of the Company, and subject to the terms of any policy and procedures applicable to all directors and senior officers of the Company, the Company shall advance to the Executive payment of reasonable costs of defending against any claims covered by the foregoing indemnification commitment. The Executive’s rights under this Section 11 shall continue so long as he may be subject to such liability, whether or not this Agreement may have terminated prior thereto.

14. Disputes; Payment of Attorney’s Fees. In the event that the Executive is the prevailing party, or is successful to a material degree, in pursuing or defending, whether in arbitration or litigation, any claim or dispute relating to the Executive’s employment with the Company, including but not limited to any claim or dispute relating to (a) this Agreement, (b) termination of the Executive’s employment with the Company or (c) the failure or refusal of the Company or the Executive to perform fully in accordance with the terms hereof, the Company shall promptly reimburse the Executive for all reasonable costs and expenses (including, but not limited to, attorneys’ fees) relating solely, or reasonably allocable, to such claim or dispute. In any other case, the Executive and the Company shall each bear all of their own costs and expenses (including, but not limited to, attorneys’ fees). Upon written consent from the Executive while any claim or dispute described in the first sentence of this Section 14 is pending, the Company shall promptly reimburse the Executive for all reasonable costs and expenses relating to such claim or dispute; provided that the Executive agrees in writing that he will repay the Company in full for such reimbursement if he is not ultimately successful to a material degree with respect to the substance of such claim or dispute. In addition, the Company shall promptly reimburse the Executive for all reasonable costs and expenses (including, but not limited to, attorneys’ fees) incurred by the Executive in preparing responses to Internal Revenue Service (“IRS”) audits of the Executives personal income tax returns or otherwise defending such tax returns in any administrative proceeding or civil litigation relating thereto that is occasioned by or connected with an audit by the IRS of one or more income tax returns of the Company. The provisions of this Section 15 shall survive the expiration or termination of this Agreement and the Period of Employment.

15. Successors.

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

16. Representations.

16.2 The Executive represents and warrants to the Company that (a) the execution, delivery and performance of this Agreement by the Executive does not and will not violate any law, regulation, order, judgment or decree or ay agreement to which the Executive is a party or by which he is bound, (b) the Executive is not a party to or bound by any employment agreement, noncompetition agreement, or confidentiality agreement with any person or entity that would interfere with this Agreement or his performance of services hereunder, (c) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive, enforceable in accordance with its terms, except to the extent enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by the effect of general principals of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

17. Miscellaneous.

		If to the Executive:

		Thomas R. Oxenreiter 10101 Clubhouse Road
		Presto, PA 15142
		Telephone: 412-206-9362

		If to the Company:

		Geospatial Corporation
		229 Howes Run Road
		Sarver, PA 16055
		Attention: General Counsel
		Fax: 724-353-3049
		Telephone: 724-353-3400

Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.

17.3 None of the provisions of this Agreement shall be deemed to impose a penalty.

17.4 The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

17.5 Any party’s failure to insist upon strict compliance with any provision hereof shall not be deemed to be a waiver of such provision or any other provision hereof.

IN WITNESS WHEREOF , the parties have executed this Agreement as of the date first above written.

	Geospatial Corporation

	By:	/s/ Mark A. Smith
	Mark A. Smith, Chairman and CEO

	Thomas R. Oxenreiter, an Individual

		/s/ Thomas R. Oxenreiter

Geospatial Corporation S-1

EXHIBIT 10.15

GEOSPATIAL CORPORATION

STOCK APPRECIATION RIGHTS AGREEMENT

Grant Date: _____October 18, 2013_________________

Number of SARs: ___3,000,000____________________

Exercise Price per SAR: _______$0.07_______________

Expiration Date: _____October 18, 2023_______________

1. Grant of SARs .

2. Vesting .

2.2 Expiration . The SARs will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.

3. Termination of Continuous Service .

3.2 Termination for Cause . If the Participant’s Continuous Service is terminated for Cause, the SARs (whether vested or unvested) shall immediately terminate and cease to be exercisable.

4. Manner of Exercise .

10. Change in Control .

10.1 Effect on SARs . In the event of a Change in Control, notwithstanding any provision of the Plan or this Agreement to the contrary, the SARs shall become immediately vested and exercisable.

11. Adjustments . The SARs may be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.

13. Non-competition and Non-solicitation .

13.1 In consideration of the SARs, the Participant agrees and covenants not to:

13.2 In the event of a breach or threatened breach of any of the covenants contained in Section 13.1 :

(a) any unvested SARs shall be forfeited effective as of the date of such breach, unless sooner terminated by operation of another term or condition of this Agreement or the Plan; and

16. Governing Law . This Agreement will be construed and interpreted in accordance with the laws of the State of Nevada without regard to conflict of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

	GEOSPATIAL CORPORATION

	By:	/s/ Mark A. Smith
	Name: Mark A. Smith
	Title: CEO

	Thomas R. Oxenreiter

	By:	/s/ Thomas R. Oxenreiter
	Name: Thomas R. Oxenreiter

Geospatial Corporation S-1

EXHIBIT 10.16

MUTUAL TERMINATION AND RELEASE AGREEMENT

THIS MUTUAL TERMINATIONAND RELEASE AGREEMENT (the " Agreement" ) is made and entered into effective February 28, 2013, by and between GEOSPATIAL HOLDINGS, INC. , a Nevada corporation (" Geospatial" ), and TIMOTHY F. SUTHERLAND, THOMAS J. RIDGE, PACE GLOBAL ENERGY SERVICES, LLC, PACE FINANCIAL SERVICES, LLC, and RIDGE GLOBAL, LLC (collectively, the " Pace Group" ). Geospatial and the Pace Group are collectively referred to herein as the " Parties" , and Geospatial and the Pace Group are individually referred to herein as a "Party".

WHEREAS, Geospatial has entered into various agreements with the Pace Group, including, but not limited to, the Strategic Advisory Agreement dated March 2, 2010; the Fee Deferral Agreement dated October 19, 2010; the Promissory Note dated October 19, 2010; the First Amendment to Fee Deferral Agreement dated February 24, 2011; the First Amendment to Promissory Note dated February 24, 2011; and the Engagement Letter dated April 27, 2011. The above-named agreements, together with any and all oral or written agreements between the Parties through the date of this Agreement are collectively known as the " Prior Agreements" .

WHEREAS , members of the Pace Group, collectively and individually, have served in various management, advisory, consulting, or Board of Directors positions in Geospatial; and

WHEREAS, Geospatial has found itself in dire financial straits and the Pace Group has resigned from its various management roles with Geospatial; and

WHEREAS , the Parties have determined it to be in their best interest to terminate all obligations between the Parties arising from the Prior Agreements, and to agree not to pursue litigation or any other action against one another.

NOW, THEREFORE , in consideration of the foregoing and the promises and mutual covenants set forth herein the Parties to this Agreement agree as follows with the intent to be legally bound:

1. Termination of Prior Agreements . The Parties agree that each of the Prior

Agreements is hereby unconditionally terminated and of no further force and effect.

2. Mutual Release; Forbearance of Suit .

(a) Mutual Release . Each Party hereby fully releases and forever discharges the other Party and all of its members, managers, employees, agents, successors, assigns, legal representatives, insurers, consultants, affiliates, directors and officers from and against any and all actions, claims, suits, demands, debts, payment obligations or other obligations or liabilities of any nature whatsoever, whether known or unknown, which such Party or any of its members, managers, employees, agents, successors, assigns, legal representatives, insurers, consultants, affiliates, directors or officers have had, now have or may in the future have directly or indirectly arising out of or in connection with the Prior Agreements, including any activities undertaken by any Party pursuant to the Prior Agreements (collectively, " Claims" ). Notwithstanding anything in this Agreement to the contrary, nothing contained herein is intended to, and this Agreement shall not operate to, release any Party from any claims it may have to enforce any rights conferred under this Agreement

(b) Acknowledgment of Possible Unknown Claims. Each Party hereby acknowledges that there is a possibility that subsequent to the execution of this Agreement it will discover facts or incur or suffer Claims that were unknown or unsuspected at the time this Agreement was executed, and which if known by it at the time may have materially affected its decision to execute this Agreement. Each Party acknowledges and agrees that by reason of this Agreement, and its release set forth above, it is assuming any risk of such unknown and unsuspected Claims.

(i)	Geospatial hereby declares the following to be known, or anticipated claims:

	(A)	Brad Brooks et al. v. Geospatial Holdings, Inc. et al., Court of
		Common Pleas of Butler County, Pennsylvania at AD 12-10436,

	(B)	Various wage and expense claims,

	(C)	Various tax obligations, and

	(D)	Normal trade payables.

ii)	In the event of any claim made against any of these parties, whether that claim be a formal Notice of Claim, civil litigation filed by Civil Complaint or Writ of Summons or any other legal attempt to collect any monetary amount, enforce a judgment, demand payment of a liability, if it is determined that Geospatial had known or should have known of the existence of that possible claim with reasonable investigation, the assumption of risk referred to in Paragraph (b) above, is hereby voided with respect to such claim.

(c) Forbearance of Suit. Each Party hereby agrees that subject to provisions of Subparagraph (b)(i) and (b)(ii) above, it will refrain and forebear from commencing, instituting or prosecuting any lawsuit, action or other proceeding of any kind whatsoever, by way of a claim or counterclaim against the other Party. However, the parties do not waive or forego their right to defend themselves respectively and bring forth any defense, set-off, cross-complaint or new matter against the other party and would fully retain all legal rights under any of the applicable Rules of Civil Procedure if litigation was commenced against Geospatial Holdings, Inc., the Pace Group or any of the individuals referred to above if said claim or litigation is brought by a third party.

(d) Indemnification . Notwithstanding any other provisions of this Agreement, each Party agrees that with regard to any and all known, anticipated, unknown, unsuspected, and other future claims, including any shareholder lawsuit whether now known or unknown, Geospatial shall indemnify the Pace Group upon any liability imposed on the Pace Group or any member of the Pace Group and from any expense reasonably incurred by the Pace Group (including the advancement of reasonable attorneys’ fees and related litigation expenses as incurred) in connection with any claim made against the Pace Group or a member of the Pace Group, or any action, suit, or proceeding to which a member of the Pace Group may be a party by reason of his being or having been an employee of Geospatial, a Director of Geospatial, an Officer of Geospatial, or a service provider of Geospatial.

(e) D&O Insurance Coverage . Geospatial agrees that Timothy F. Sutherland and Thomas J. Ridge, as Directors and Officers of Geospatial, were and remain covered by Geospatial’s Directors’ and Officers’ Liability insurance and not to reduce, terminate, non-renew or rescind any such insurance coverage, regardless of whether any additional potential claims from that period are known to the Parties as of the date of the execution of this agreement.

3. Miscellaneous .

(a) This Agreement shall be binding on and inure to the benefit of the Parties hereto and their respective heirs, personal representatives, successors and assigns.

(b) This Agreement may be executed in more than one counterpart, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

(c) The Parties agree that this Agreement sets forth the entire agreement between them on this subject, and supersedes all other oral and written understandings or agreements between the parties regarding the subject matter of this Agreement.

(d) Any amendment to this Agreement shall be made in writing and signed by the Parties hereto.

[Signature page follows.]

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement effective as of the first date set forth above.

	PACE GLOBAL ENERGY SERVICES, LLC

	By: /s/ Timothy F. Sutherland
	Timothy F. Sutherland

	PACE FINANCIAL SERVICES, LLC

	By: /s/ Timothy F. Sutherland
	Timothy F. Sutherland

	RIDGE GLOBAL, LLC

	By: /s/ Tom Ridge
	Tom Ridge

	TIMOTHY SUTHERLAND, INDIVIDUAL

	By: /s/ Timothy F. Sutherland
	Timothy F. Sutherland

	TOM RIDGE, INDIVIDUAL

	By: /s/ Tom Ridge
	Tom Ridge

	GEOSPATIAL HOLDINGS, INC.

	By: /s/ Mark A. Smith
	Mark A. Smith, CEO

Geospatial Corporation S-1

EXHIBIT 10.17

MUTUAL RELEASE AND SETTLEMENT AGREEMENT

THIS MUTUAL RELEASE AND SETTLEMENT AGREEMENT (the “ Agreement ”) is made and entered into as of May 10th, 2013, by and between GEOSPATIAL HOLDINGS, INC. , a Nevada corporation (“ Geospatial ”), GEOSPATIAL MAPPING SYSTEMS, INC., a Delaware corporation (“ GMS ”), REDUCT N.V. , a company organized and existing under the laws of Belgium (“ Reduct ”) and DELTA NETWORKS, S.A. , a company incorporated under the laws of Luxemburg (“ Delta ”). Geospatial, GMS, Reduct and Delta are collectively referred to herein as the “ Parties ”, and are individually referred to herein as a “ Party ”.

WHEREAS , Reduct and GMS are parties to that certain Amended and Restated Exclusive License and Distribution Agreement dated December 15, 2009, as subsequently amended (together with the amendments, the “ License Agreement ”), pursuant to which, among other things, Reduct granted to Licensee an exclusive right and license to promote, market, use, and distribute certain Reduct products and technology;

WHEREAS , Reduct issued on December 16, 2010 a notice of termination under Section 15.4 of the License Agreement, with effect of termination on January 17, 2011;

WHEREAS , the Parties entered into a new License and Distribution Agreement dated April 5, 2011 so that the surviving provisions of the License Agreement would be of no further force and effect and so that this new agreement would constitute the entire new understanding between the Parties, but which, by its terms, never became effective (the “ 2011 Agreement ”);

WHEREAS , the License Agreement, the 2011 Agreement and any and all oral or written agreements between the Parties through the date of this Agreement are collectively referred to in the Agreement as the “ Prior Agreements ”; and

WHEREAS , the Parties desire to (i) terminate all obligations between the Parties arising from the Prior Agreements, (ii) confirm that the 2011 Agreement never became effective, and (iii) agree not to pursue litigation or any other action against one another, all upon the terms and subject to the conditions of this Agreement.

NOW, THEREFORE , in consideration of the foregoing and the promises and mutual covenants set forth herein, the Parties to this Agreement agree as follows with the intent to be legally bound:

1. Acknowledgement Regarding 2011 Agreement. The Parties hereby acknowledge, agree and confirm that (i) the 2011 Agreement was never effective, and (ii) upon satisfaction of the conditions set forth in Section 3 of this Agreement, the 2001 Agreement shall not be enforced by any of the Parties.

2 . Mutual Release . The Parties hereby agree that upon satisfaction of the conditions set forth in Section 3 of this Agreement, the following provision automatically shall take effect and be binding upon the Parties hereto:

(a) Mutual Release . Each Party hereby fully releases and forever discharges each other Party and all of its members, managers, employees, agents, successors, assigns, legal representatives, insurers, consultants, affiliates, directors and officers from and against any and all actions, claims, suits, demands, debts, payment obligations or other obligations or liabilities of any nature whatsoever, whether known or unknown, which such Party or any of its members, managers, employees, agents, successors, assigns, legal representatives, insurers, consultants, affiliates, directors or officers have had, now have or may in the future have directly or indirectly arising out of or in connection with the Prior Agreements, including any activities undertaken by any Party pursuant to the Prior Agreements (collectively, “ Claims ”). Notwithstanding anything in this Agreement to the contrary, nothing contained herein is intended to, and this Agreement shall not operate to, release any Party from any claims it may have to enforce any rights conferred under this Agreement

3. Conditions of Release . The Parties hereby agree that the covenants and agreements of the Parties set forth in Sections 1 and 2 above are expressly conditioned upon, and shall only become effective upon, the prior satisfaction of each of the following conditions:

(a) Issue and subscription . Geospatial shall have issued and delivered to Delta, at no cost to Delta, and Delta agrees to receive, in consideration for Delta, on behalf of itself and its wholly owned subsidiary Reduct, effectively releasing each Party under Section 2(a) of this Agreement, within 30 days after Geospatial closes, and receives, and provided that such receipt occurs on or before 31 July, 2013, a minimum of $2.0 million in cash from, the offer and sale of its Series B Convertible Preferred Stock (the “ Capital Raise ”), (i) nine million (9,000,000) shares of common stock, par value $.001 per share, of Geospatial (“ Common Stock ”), and (ii) warrants to purchase three million (3,000,000) shares of Common Stock at an exercise price of $0.50 per share, exercisable until December 31, 2015 (the “ Delta Warrants ”), following which Geospatial shall have not more than 158,000,000 Common Stock Equivalents Outstanding (as defined in Section 3(b) below ). Attached hereto as Schedule 3(a) is a Pro Forma Table showing Common Stock Equivalents Outstanding as of the date of this Agreement, plus the shares of Common Stock and the Delta Warrants to be issued pursuant to this Section 3(a) and shares anticipated to be issued in the Capital Raise.

(b) Anti-Dilution . Delta will have the following anti-dilution protection for its shares of Common Stock:

(i) Adjustment Formula . Following the issuance of Common Stock to Delta pursuant to Section 3(a) hereof, if Geospatial issues or sells, or is deemed by the provisions of this Section 3(b) to have issued or sold, Additional Shares of Common Stock (as hereinafter defined), otherwise than in connection with a Common Stock Event (as hereinafter defined), for an Effective Price (as hereinafter defined) that is less than $0.07 per share (the “ Measurement Price ”) (a “ Triggering Issuance ”), then, and in each such case, Geospatial shall issue to Delta such number of additional shares of Common Stock that is equal to the product of (A) one minus a fraction, the numerator of which is the Effective Price in the Triggering Issuance and the denominator of which is the Measurement Price, multiplied by (B) the difference between (x) the Delta Percentage immediately prior to the Triggering Issuance multiplied by the Common Stock Equivalents Outstanding immediately following the Triggering Issuance, minus (y) the Delta Shares held by Delta immediately prior to the Triggering Issuance.

(ii) Definitions . For purposes of this Section 3(b) , the following terms have the meanings indicated:

“ Additional Shares of Common Stock ” means all shares of Common Stock issued by Geospatial, whether or not subsequently reacquired or retired by the Company, other than: (A) shares of Common Stock issued or issuable upon conversion of Preferred Stock; and (B) shares of Common Stock (or options, warrants or rights therefor) issued to employees, officers, or directors of, or contractors, consultants or advisers to, Geospatial pursuant to a stock option plan duly approved by the Board and the shareholders of Geospatial.

“ Aggregate Consideration Received ” by Geospatial for any issue or sale (or deemed issue or sale) of securities shall (A) to the extent it consists of cash, be computed at the gross amount of cash received by Geospatial before deduction of any underwriting or similar commissions, compensation or concessions paid or allowed by Geospatial in connection with such issue or sale and without deduction of any expenses payable by Geospatial; (B) to the extent it consists of property other than cash, be computed in the manner set forth in the definition of Non-Cash Consideration (as defined below); and (C) if Additional Shares of Common Stock, Convertible Securities (as defined below) or Rights or Options (as defined below) are issued or sold together with other stock or securities or other assets of Geospatial for a consideration which covers both, be computed as the portion of the consideration so received that may be reasonably determined in good faith by the Board to be allocable to such Additional Shares of Common Stock, Convertible Securities or Rights or Options.

“ Board ” means the board of directors of Geospatial.

“ Common Stock Equivalents Outstanding ” shall mean the number of shares of Common Stock that are equal to the sum of (A) all shares of Common Stock of Geospatial that are outstanding at the time in question, plus (B) all shares of Common Stock of Geospatial issuable upon conversion of all shares of Convertible Securities that are outstanding at the time in question, plus (C) all shares of Common Stock of Geospatial that are issuable upon the exercise of Rights or Options that are outstanding at the time in question assuming the full conversion or exchange into Common Stock of all such Rights or Options that are Rights or Options to purchase or acquire Convertible Securities.

“ Common Stock Event ” shall mean (i) the issue by Geospatial of additional shares of Common Stock as a dividend or equivalent distribution on outstanding Common Stock, (ii) a subdivision of the outstanding shares of Common Stock into a greater number of shares of Common Stock, or (iii) a combination of the outstanding shares of Common Stock into a smaller number of shares of Common Stock.

“ Convertible Securities ” shall mean stock or other securities convertible into or exchangeable for shares of Common Stock.

“ Delta Percentage ” as of a particular time shall be equal to the quotient of (a) the number of Delta Shares held by Delta as of such time, divided by (b) the Common Stock Equivalents Outstanding as of such time.

“ Delta Shares ” means the sum of (a) the shares of Common Stock issued to Delta pursuant to Section 3(a) hereof, plus (b) the shares of Common Stock, if any, issued to Delta pursuant to Section 3(b) hereof.

“ Effective Price ” of Additional Shares of Common Stock shall mean the quotient determined by dividing the total number of Additional Shares of Common Stock issued or sold, or deemed to have been issued or sold, by Geospatial under Section 3(b)(i) into the Aggregate Consideration Received, or deemed to have been received, by Geospatial under Section 3(b)(i) , for the issue or sale of such Additional Shares of Common Stock.

“ Non-Cash Consideration ” means with respect to any property other than cash received by Geospatial for any issue or sale (or deemed issue or sale) of securities, the fair market value of such property as determined by the Board, except that any securities so received by Geospatial shall be valued as follows:

a. if the securities are then traded on a National Securities Market (or a similar national quotation system), then the value shall be deemed to be the average of the closing prices of the securities on such National Securities Market or system over the 30-day period ending three (3) days prior to the distribution; and

b. if actively traded over-the-counter, then the value shall be deemed to be the average of the closing bid prices over the 30-day period ending three(3) days prior to the distribution; and

c. if there is no active public market, then the value shall be the fair market value thereof as determined in good faith by the Board.

“ Preferred Stock ” shall mean preferred stock of Geospatial.

“ Rights or Options ” shall mean warrants, options or other rights to purchase or acquire shares of Common Stock or Convertible Securities.

(i) Such maximum number of Common Stock Equivalents Outstanding may be increased proportionately if and to the extent the amount of the Capital Raise exceeds $2.0 million.

(ii) The provisions of this Section 3(b) shall expire and be of no further force and effect upon the later to occur of (1) a registration statement in which Delta shall have the right or opportunity to include the Delta Shares, shall have been filed by the Company with, and declared effective by, the U.S. Securities and Exchange Commission, and (2) the Company shall have raised a total of at least $5.0 million in cash (including amounts raised in the Capital Raise) from the sale of its capital stock (or securities convertible into capital stock).

(c) Order and Payment . Geospatial shall have (i) placed an order, for probes and calibration fees with Reduct, within 30 days after completion of the Capital Raise, in the minimum amount of $100,000USD under Reduct’s standard terms and pricing; (ii) placed an additional order, for probes and calibration fees with Reduct within 150 days after completion of the Capital Raise, in the minimum amount of $100,000USD under Reduct’s standard terms and pricing; (iii) placed an additional order, for probes and calibration fees with Reduct within 270 days after the completion of the Capital Raise, in the minimum amount of $100,000 USD under Reduct’s standard terms and pricing, and (ii) paid for each of the order and additional orders in their entirety upon notice from Reduct that each order is ready to ship.

4. Representations and Warranties from Reduct, Delta, Geospatial and GMS . Each Party hereby represents and warrants to the other Parties that:

(a) such Party is a company duly incorporated or formed, and organized, and is validly existing under the laws of its jurisdiction of incorporation or formation and has not been dissolved;

(b) such Party has full power, authority and capacity to enter into this Agreement and to perform its obligations hereunder. Except as expressly provided herein, all corporate actions, conditions, approvals and requirements to be taken, fulfilled, obtained, given and done by such Party in order to enable it to lawfully and validly enter into, exercise its rights and perform and comply with its obligations under this Agreement have been fully and validly taken, fulfilled, obtained, given and done; and

(c) this Agreement has been duly executed and delivered by such Party and constitutes a legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to any rules of law or equity. The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby and the fulfillment by such Party of the terms, conditions and provisions hereof will not contravene or violate or result in the breach (with or without the giving of notice or lapse of time, or both) or acceleration of any obligations of such Party under:

(i) any laws applicable to such Party;

(ii) any judgment, order, writ, injunction or decree of any court or of any authority which is presently applicable to such Party;

(iii) the charter documents of such Party or any amendments thereto or restatements thereof; or

(iv) the provisions of any agreement, arrangement or understanding to which such Party is a party or by which it is bound.

5. Additional Representations and Warranties of Geospatial . Geospatial represents and warrants to Delta as follows:

(a) All corporate action on the part of Geospatial necessary for the issuance of the shares of Common Stock to Delta pursuant to the terms of this Agreement (the “ Shares ”) shall be taken on or prior to the date of issuance. The Shares, when issued and delivered in accordance with the terms of this Agreement will be duly authorized, validly issued, fully paid and non-assessable and will be free of restrictions on transfer other than restrictions under applicable state and federal securities laws.

(b) Except as provided in Schedule 5(b) to this Agreement, Geospatial is currently not under any obligation and has not granted any rights to register under the Securities Act of 1933, as amended (the “ Securities Act ”), any of its presently outstanding securities or any of its securities that may be subsequently issued. Geospatial is not a party to any trust or agreement regarding the voting of shares (or the giving of written consents) of its capital stock. To Geospatial’s knowledge, there are no other trusts or agreements regarding the voting of shares of the Geospatial’s capital stock.

6. Additional Representations and Warranties of Delta . Delta represents and warrants to Geospatial as follows:

a. Investment Representations . Delta understands that the Shares will not be registered under the Securities Act or the securities laws of any other jurisdiction. Delta also understands that the Shares will be issued to Delta pursuant to an exemption from registration contained in the Securities Act based in part upon Delta’s representations contained in this Agreement.

b. Experience; Risk . Delta has such knowledge and experience in financial and business matters that Delta is capable of evaluating the merits and risks of its acquisition of the Shares and of protecting its interests in connection therewith. Delta has the ability to bear the economic risk of its investment in the Shares, including complete loss of its investment.

c. Investment . Delta is receiving the Shares for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distribution thereof, and Delta has no present intention of selling, granting any participation in, or otherwise distributing the same. Delta understands that the Shares have not been and will not be registered under the Securities Act and other applicable securities laws (collectively, the “ Acts ”) by reason of a specific exemption from the registration provisions of the Acts which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of Delta’s representations as expressed herein.

d. Disclosure . Geospatial has provided Delta with access to Geospatial’s SEC Reports and all information that Geospatial believes is reasonably necessary to enable Delta to decide whether to acquire the Shares. Delta understands that an investment in the Shares involves significant risks.

e. Restricted Securities . Except as provided in Section 7 of this Agreement, Delta understands that the Shares will be “restricted securities” under applicable securities laws inasmuch as they are being acquired from Geospatial in a transaction not involving a public offering and that under such laws and applicable regulations the Shares may be resold without registration under the Acts only in certain limited circumstances. Delta acknowledges that the Shares must be held indefinitely unless subsequently registered under the Acts or an exemption from such registration is available.

f. Accredited Investor . Delta is an “accredited investor” within the meaning of Rule 501 promulgated under the Securities Act

g. Legends . Delta understands and agrees that the certificates representing the Shares will bear a legend substantially similar to the legend set forth below:

THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR (B) IN A TRANSACTION WHICH IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS.

7. Registration Rights . Upon issuance of the shares of Common Stock to Delta pursuant to Section 3(a) , Delta and Geospatial shall enter into a Registration Rights Agreement in the form of Exhibit A hereto.

8. Miscellaneous .

(a) Governing Law and Forum for Disputes . This Agreement shall be governed by, construed and interpreted in accordance with the laws of the Belgium without regard to any conflicts of laws or provisions therein. Any and all disputes hereunder shall be litigated, if at all, in either the Courts of Antwerp or elsewhere in Belgium, it being the intention of all Parties that Belgium serve as the exclusive forum for dispute resolution. All Parties submit to the jurisdiction of the courts of Antwerp, and agree that, in the event an action is brought in the courts of Belgium, they will waive any argument of lack of personal jurisdiction or improper venue, which they might otherwise have. All Parties waive any rights to remove any action brought in a court in Belgium, to a court outside that jurisdiction.

(b) Governing Language . This Agreement is in the English language only, which shall be controlling in all respects. In the event this Agreement is translated into the language of the court having jurisdiction over this Agreement, the English version of this Agreement shall prevail over such translation with respect to any and all interpretations of this Agreement and with respect to any interpretation by such court of the intent of the Parties hereto.

(c) Successors and Assigns . This Agreement may not be assigned, conveyed or transferred by any Party without the prior written consent of other Parties. Subject to the foregoing, the rights and obligations of the Parties under this Agreement shall be binding upon and benefit, the Parties hereto and their respective permitted successors and assigns. The terms and provisions of this Agreement are for the sole benefit of the Parties hereto and thereto and their respective permitted successors and assigns, and are not intended to confer any third-party benefit on any other person.

(d) Entire Agreement . This Agreement constitutes the full and entire understanding and agreement between the Parties with regard to the subject matter hereof and no Party shall be liable or bound to any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein. Any previous agreement among the Parties relative to the specific subject matter hereof is superseded by this Agreement.

(e) Severability . In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

(f) Amendment or Waiver . This Agreement may be amended with only the written consent of the Parties hereto. Any failure of either Party to enforce at any time, or for any period of time, any provision of this Agreement, shall not constitute a waiver of such provision or in any way affect the validity of this Agreement.

(g) Notices . Any notice required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given (i) when received if personally delivered, or if sent by email or (ii) within five (5) days after being sent by registered or certified mail, return receipt requested postage prepaid, to the Parties, at the respective addresses of the Parties set forth below or at such other address as shall be given by any Party to the others in writing:

If to Reduct :

Otto Ballintijn

Reduct NV

Molenberglei 42

B-2627 Schelle

Belgium

Email: otto.ballintijn@reduct.net

If to Delta Networks :

Delta Networks Limited SA

70 Grand-Rue

L-1660 Luxembourg

Postal address:

P.B. 498

L-2014 Luxembourg

Tel: +352 268719-33

Fax: +352 268719-40

Attention: Peter Magnus

Email: p.magnus@delta-assets.com

If to Geospatial or GMS:

President

Geospatial Holdings, Inc.

229 Howes Run Road

Sarver, PA 16055

Email: Mark@geospatialcorporation.com

(h) Counterparts . This Agreement may be executed in more than one counterpart, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

[Signature page follows.]

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement effective as of the first date set forth above.

	GEOSPATIAL HOLDINGS, INC.

	By:	/s/ Mark A. Smith
		Mark A. Smith, CEO

	GEOSPATIAL MAPPING SYSTEMS, INC.

	By:	/s/ Mark A. Smith
		Mark A. Smith, CEO

	REDUCT, NV

	By:	/s/ Otto Ballintijn
		Otto Ballintijn, Managing Director

	DELTA NETWORKS, SA

	By:	/s/ Peter Magnus
		Peter Magnus

	Title:

EXHIBIT A

FORM OF REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “ Agreement ”) is entered into as of this _____ day of ___________, 2013 (the “ Effective Date ”) by and between Geospatial Holdings, Inc., a Nevada corporation (the “ Company ”), and Delta Networks, S.A., a company incorporated under the laws of Luxemburg (“ Delta ”).

AGREEMENT

WHEREAS, the Company, Delta, Geospatial Mapping Systems, Inc. and Reduct, N.V. are parties to a Mutual Release and Settlement Agreement dated May ____, 2013 (the “Settlement Agreement”); and

WHEREAS, pursuant to the terms of the Settlement Agreement, the Company has, on the date hereof, issued to Delta nine million (9,000,000) shares (the “ Shares ”) of common stock, par value $.001 per share, of the Company (“ Common Stock ”); and

WHEREAS, the Settlement Agreement requires that, upon issuance of the Shares to Delta, Geospatial and Delta will enter into this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereby agree as follows:

ARTICLE I
DEFINITIONS

1.1 Definitions . As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

“ Agreement ” has the meaning set forth in the preamble.

“ Board ” means the board of directors of the Company.

“ Common Stock ” has the meaning set forth in the preamble.

“ Company ” has the meaning set forth in the preamble.

“ Effective Date ” has the meaning set forth in the preamble.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Initial Offering ” means the Company’s first firm commitment underwritten public offering of its Common Stock registered under the Securities Act.

“ Register, ” “ registered ” and “ registration ” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

“ Registrable Shares ” means (a) Common Stock of the Company issued to Delta (“ Initial Registrable Shares ”); (b) any other shares of Common Stock hereafter owned or held by Delta; and (c) any “Registrable Shares” as defined in any other agreement pursuant to which the Company has granted registration rights. Notwithstanding the foregoing, Registrable Shares shall not include any securities sold by a Person to the public either pursuant to a registration statement or Securities Act Rule 144 or sold in a private transaction in which the transferor’s rights pursuant to Section IV of this Agreement are not assigned.

“ Requirements of Law ” means, as to any Person, the provisions of the charter and bylaws or other organizational or governing documents of such Person, and any law, treaty, rule, regulation, right, privilege, qualification, license or franchise, order, judgment, or determination of an arbitrator or a court or other Governmental Authority applicable to or binding upon such Person or any of its property (or to which such Person or any of its property is subject) or applicable to any or all of the transactions contemplated by, or referred to in, this Agreement.

“ Restricted Period ” has the meaning set forth in Section 4.9 .

“ SEC ” or “ Commission ” means the Securities and Exchange Commission.

“ SEC Reports ” shall mean all reports required to be filed with the SEC under the Securities Act and the Exchange Act.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Selling Expenses ” means all underwriting discounts and selling commissions applicable to the sale.

“ Violation ” has the meaning set forth in Section 4.7(a) .

ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to Delta follows:

2.1 Authorization; Binding Effect . The Company has full power and authority to enter into and perform its obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

2.2 Non-contravention . The execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby, do not and will not (i) violate any Requirements of Law applicable to the Company, or (ii) result in a material breach or default under any of the Contractual Obligations of the Company, or under any order, writ, judgment, injunction, decree, determination or award of any Governmental Authority, in each case applicable to the Company or its properties.

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF DELTA

Delta hereby represents and warrants as of the date hereof as follows:

3.1 Authorization; Binding Effect . Delta has full power and authority to enter into and perform its obligations under this Agreement. This Agreement constitutes the valid and legally binding obligation of Delta, enforceable against Delta in accordance with its terms, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as may be limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

3.2 Non-contravention . The execution, delivery and performance of this Agreement by Delta, and the consummation of the transactions contemplated hereby, do not and will not (a) violate any Requirements of Law applicable to Delta, or (b) result in a material breach or default under any of the Contractual Obligations of Delta, or under any order, writ, judgment, injunction, decree, determination or award of any Governmental Authority, in each case applicable to Delta or Delta’s properties.

ARTICLE IV
REGISTRATION; COVENANTS OF THE COMPANY

4.1 Registration . The Company shall, within six (6) months following the issuance of the Initial Registrable Shares, and within six (6) months following the exercise by Delta of the Delta Warrants (as defined in the Settlement Agreement), file a registration statement under the Securities Act covering the Registrable Shares and thereafter shall use its reasonable commercial efforts to cause such registration statement to be declared effective as soon thereafter as reasonably practicable. Such registration shall provide for sale or distribution of such Registrable Shares on a delayed or continuous basis pursuant to Rule 415 under the Securities Act to the extent it is available.

4.2 Piggyback Registration . The Company shall notify all Holders of Registrable Shares in writing at least thirty (30) days prior to the filing of any registration statement under the Securities Act for purposes of a public offering of securities of the Company (including, but not limited to, registration statements relating to secondary offerings of securities of the Company, but excluding registration statements relating to employee benefit plans or with respect to corporate reorganizations or other transactions under Rule 145 of the Securities Act), which notice will specify the proposed offering price, the kind and number of securities proposed to be registered, the distribution arrangements and such other information that at the time would be appropriate to include in such notice, and will afford each such Holder an opportunity to include in such registration statement all or part of such Registrable Shares held by such Holder on terms and conditions at least as favorable as those applicable to the securities to be sold by the Company and by any other person thereunder. Each Holder desiring to include in any such registration statement all or any part of the Registrable Shares held by it shall, within fifteen (15) days after the above-described notice from the Company, so notify the Company in writing. If a Holder decides not to include some or all of its Registrable Shares in any registration statement thereafter filed by the Company or decides to withdraw its Registrable Shares from any underwriting or registration pursuant to Section 4.1 , such Holder shall nevertheless continue to have the right to include any Registrable Shares in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein

a. Underwriting . If the registration statement under which the Company gives notice under this Section 4.2 is for an underwritten offering, the Company shall so advise the Holders of Registrable Shares. In such event, the right of any such Holder to be included in a registration pursuant to this Section 4.2 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Shares in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Shares through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision of this Agreement, if the underwriter determines in good faith that marketing factors require a limitation of the number of securities to be underwritten and advises the Holders of Registrable Shares in writing, the number of shares that may be included in the underwriting shall be allocated, first, to the Company; second, to the Holders on a pro rata basis based on the total number of Registrable Shares held by the Holders; and third, to any holder of securities of the Company (other than a Holder) on a pro rata basis. In making any such reduction, all shares held by employees of the Company which are not Registrable Shares shall first be excluded. No such reduction shall (i) reduce the securities being offered by the Company for its own account to be included in the registration and underwriting or (ii) reduce the amount of Registrable Shares of the selling Holders included in the registration below thirty three and one-third percent (33 1/3%) of the total amount of securities included in such registration, unless such offering is the Initial Offering, in which event any or all of the Registrable Shares of the Holders may be excluded. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the underwriter, delivered at least ten (10) business days prior to the effective date of the registration statement. Any Registrable Shares excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder which is a partnership, limited liability company or corporation, the partners and members, retired partners and members and shareholders of such Holder, or the estates and family members of any such partners and members and retired partners and members and any trusts for the benefit of any of the foregoing person shall be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “ Holder, ” as defined in this sentence.

b. Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 4.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4.4 hereof.

a. promptly give written notice of the proposed registration, and any related qualification or compliance, to all other Holders of Registrable Securities; and

b. as soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder’s or Holders’ Registrable Shares as are specified in such request, together with all or such portion of the Registrable Shares of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company; provided , however , that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 4.3 :

(i) if Form S-3 is not available for such offering by the Holders, or

(iii) if the Company shall furnish to the Holders a certificate signed by the chairman of the Board of the Company or its chief executive officer stating that in the good faith judgment of the Board of the Company, it would be seriously detrimental to the Company and its shareholders for such Form S-3 registration to be effected at such time, in which event the Company shall have the right to defer the filing of the Form S-3 registration statement for a period of not more than ninety (90) days after receipt of the request of the Holder or Holders under this Section 4.3 ; provided , that such right to delay a request shall be exercised by the Company not more than once in any twelve (12) month period, or

(iv) if the Company has, within the twelve (12) month period preceding the date of such request, already effected one (1) registration on Form S-3 for the Holders pursuant to this Section 4.3 .

c. Subject to the foregoing, the Company shall file a Form S-3 registration statement covering the Registrable Shares and other securities so requested to be registered as soon as practicable after receipt of the request or requests of the Holders. Registrations effected pursuant to this Section 4.3 shall not be counted as demands for registration or registrations effected pursuant to Section 4.1 or Section 4.2 , respectively.

4.5 Obligations of the Company . Whenever required to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

a. Prepare and file with the SEC a registration statement with respect to such Registrable Shares and use its best efforts to cause such registration statement to become effective as soon as possible, and in any event within thirty (30) days of the date on which the obligation to effect such registration arises, and, upon the request of the Holders of a majority of the Registrable Shares registered thereunder, keep such registration statement effective for up to one hundred eighty (180) days or, if a shelf registration pursuant to Securities Act Rule 415, until the Holder or Holders have completed the distribution related thereto.

e. In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement, provided that such underwriting agreement shall not provide for indemnification or contribution obligations on the part of the Holders greater than the obligations set forth in Sections 4.7(b) and (d) .

f. Notify each Holder of Registrable Shares covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and correct such misrepresentation or omission as expeditiously as reasonably possible.

g. Use its best efforts to furnish, on the date that such Registrable Shares are delivered to the underwriters for sale, if such securities are being sold through underwriters, (i) an opinion, dated as of such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters, if any, and (ii) to the Holders requesting registration of Registrable Securities, a letter dated as of such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering addressed to the underwriters.

h. Cooperate and assist in any filings to be made with the Financial Industry Regulatory Authority, Inc.

i. Cause all such Registrable Shares to be listed on each securities exchange on which similar securities issued by the Company are then listed, or cause such Registrable Shares to be authorized for trading on the Nasdaq Stock Market if any similar securities issued by the Company are then so authorized, if requested by the Holders of a majority of such Registrable Securities.

k. In connection with an underwritten offering, to the extent requested by the managing underwriters or Holders, participate in and support customary efforts to sell the Registrable Shares in the offering; including without limitation, participating in “road shows.”

4.7 Indemnification . In the event any Registrable Shares are included in a registration statement under Section 4.1, 4.2 or 4.3 :

a. To the extent permitted by law, the Company will indemnify and hold harmless each Holder, the partners, stockholders, members, officers and directors of each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “ Violation ”) by the Company: (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law in connection with the offering covered by such registration statement; and the Company will pay as incurred to each such Holder, partner, stockholder, member, officer, director, underwriter or controlling person any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided , however , that the indemnity agreement contained in this Section 4.7(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by such Holder, partner, officer, director, underwriter or controlling person of such Holder.

b. To the extent permitted by law, each Holder will, if Registrable Shares held by such Holder are included in the securities as to which such registration, qualifications or compliance is being effected, indemnify and hold harmless the Company, each of its stockholders, directors, officers and each person, if any, who controls the Company within the meaning of the Securities Act, any underwriter and any other Holder selling securities under such registration statement or any of such other Holder’s partners, stockholders, members, officers and directors, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages or liabilities (joint or several) to which the Company or any such stockholder, director, officer, controlling person, underwriter or other such Holder, or the partners, stockholders, members, officers and directors of such other Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder under an instrument duly executed by such Holder and stated to be specifically for use in connection with such registration; and each such Holder will pay as incurred any legal or other expenses reasonably incurred by the Company or any such director, officer, controlling person, underwriter or other Holder, or the partners, stockholders, members, officers and directors of such other Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, in connection with investigating or defending any such loss, claim, damage, liability or action if it is judicially determined that there was such a Violation; provided , however , that the indemnity agreement contained in this Section 4.7(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld; provided further , that in no event shall any indemnity under this Section 4.7 exceed the proceeds from the offering received by such Holder; provided further , that any payments will be repaid to each such Holder if the Company acted recklessly.

c. Promptly after receipt by an indemnified party under this Section 4.7 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 4.7 , deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided , however , that an indemnified party shall have the right to retain its own counsel, with the fees and expenses to be paid by the indemnifying party, if in the reasonable opinion of counsel representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if (and only to the extent) materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 4.7 , but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 4.7 .

d. If the indemnification provided for in this Section 4.7 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any losses, claims, damages or liabilities referred to herein, the indemnifying party, in lieu of indemnifying such indemnified party thereunder, shall to the extent permitted by applicable law contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the Violation(s) that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and of the indemnified party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; provided , that in no event shall any contribution by a Holder hereunder exceed the proceeds from the offering received by such Holder.

e. The obligations of the Company and Holders under this Section 4.7 shall survive completion of any offering of Registrable Shares in a registration statement and the termination of this Agreement. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.

4.8 Assignment of Registration Rights . The rights to cause the Company to register Registrable Shares pursuant to this Article IV may be transferred or assigned by a Holder to a transferee or assignee of Registrable Shares which (a) is a subsidiary, parent, stockholder, general partner, limited partner, retired partner, member, retired member or Affiliate of a Holder, (b) is a Holder’s Immediate Family member or an estate or trust of or for the benefit of an individual Holder, or (c) acquires at least twenty percent (20%) of the Registrable Shares held by such Holder; provided , however , (i) the transferor shall, within ten (10) days after such transfer, furnish to the Company written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (ii) such transferee shall become a party to this Agreement.

4.9 “Market Stand-Off” Agreement; Agreement to Furnish Information . Each Holder hereby agrees that such Holder shall, if requested by the underwriter of any underwritten public offering of the Company’s Common Stock, agree with such underwriter not to sell, transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale of, any Common Stock (or other securities) of the Company held by such Holder (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company (the “ Restricted Period ”) not to exceed ninety (90) days following the effective date of any registration statement of the Company filed under the Securities Act in connection with the Initial Offering; provided that such agreements shall not apply to Registrable Shares included in such registration statement or sales or similar transactions effected pursuant to a valid exemption from the registration requirements of the Securities Act. Each Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other securities) of the Company, each Holder shall provide, within ten (10) days of such request, such information concerning such Holder as may be reasonably requested by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section 4.9 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of the Restricted Period.

4.10 Information Regarding the Company . With a view to making available to Delta the benefits of certain rules and regulations of the SEC which may permit the sale of the Shares to the public without registration, the Company agrees to:

b. So long as Delta owns any Shares, furnish to Delta forthwith upon request: (i) a written statement by the Company as to its compliance with the reporting requirements of the Exchange Act (at any time after it has become subject to such reporting requirements); (ii) a copy of the most recent annual or quarterly report of the Company; and (iii) such other reports and documents as Delta may reasonably request in availing itself of any rule or regulation of the SEC allowing it to sell the Notes without registration.

ARTICLE V
GENERAL PROVISIONS

5.1 Indemnification . Delta agrees to indemnify and hold harmless the Company, its officers, managers, affiliates, counsel, agents and each other Person, if any, who controls or is controlled by it, within the meaning of Section 15 of the Securities Act, against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all expenses reasonably incurred in investigating, preparing or defending against any litigation commenced or threatened or any claim whatsoever) arising out of or based upon any false representation or warranty or breach or failure by Delta to comply with any covenant or agreement made by Delta herein or in any other document furnished by Delta to any of the foregoing in connection with this transaction.

5.2 Amendment . This Agreement may be amended, modified or supplemented at any time by the parties hereto only by an instrument in writing signed on behalf of each of the parties hereto. No agreement made through the use of electronic records or electronic signatures, as those terms are used in the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Sec. 7001 et. seq., shall be enforceable or binding on either party hereto. Notwithstanding the previous sentence, facsimile signatures, telecopied signatures, or copies of signatures in PDF format sent by e-mail, will constitute a sufficient form of writing for purposes of this Section 5.2 and Section 5.3 .

5.3 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

5.4 Headings . The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

5.5 Governing Law . This Note shall be governed by and construed in accordance with the laws of the State of New York.

5.7 Entire Agreement; Waivers . This Agreement, together with the Settlement Agreement, is intended by the parties as a final expression of their agreement and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth herein and in the Settlement Agreement. This Agreement and the Settlement Agreement supersede all prior agreements and understandings between the parties with respect to such subject matter. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

5.8 Further Assurances . Each of the parties shall execute such documents and perform such further acts (including, without limitation, obtaining any consents, exemptions, authorizations, or other actions by, or giving any notices to, or making any filings with, any Governmental Authority or any other Person) as may be reasonably required or desirable to carry out or to perform the provisions of this Agreement.

5.9 Notices . All notices or other communications given or made hereunder shall be in writing and shall be delivered or mailed by registered or first class mail, postage prepaid, or express overnight courier service, to the address set forth in the Settlement Agreement.

(Signature Page Follows)

IN WITNESS WHEREOF , the Company and Delta have executed this Agreement as of ______________, 2013.

	GEOSPATIAL HOLDINGS, INC.

	By:
		Mark A. Smith, CEO

	DELTA NETWORKS, SA

	By:
		Peter Magnus

	Title:

SCHEDULE 3(a)

CAPITALIZATION TABLE

Geospatial Holdings, Inc.

Common Stock Equivalent - April 30, 2013

	Common		Series B		Total				Convertible		Options and		Fully- Diluted
	Stock		Preferred		Outstanding				Notes		Warrants		Shares
Common stock outstanding		42,181,416		—		42,181,416	33	%						42,181,416	27	%
Series B preferred up to approx. $2 million		—		28,571,429		28,571,429	23	%				2,857,143		31,428,571	20	%
Penalty Shares through December 31, 2013		2,155,520				2,155,520	2	%		—		—		2,155,520	1	%

Mark A. Smith		13,088,695		17,523,569		30,612,264	24	%		—		9,752,357		40,364,620	26	%
Thomas R. Oxenreiter		21,420		3,617,140		3,638,560	3	%		—		461,714		4,100,274	3	%
10% Senior Convertible Redeemable Notes - Converts at $0.50		—				—	0	%		5,532,405				5,532,405	4	%
Bensen note through 12-31-13				10,231,664		10,231,664	8	%				1,023,166		11,254,830	7	%
Employee stock options - Convert from $0.50 to $1.00						—	0	%				950,000		950,000	1	%
Outstanding warrants - Convert from $.50 to $1.00						—	0	%				5,491,272		5,491,272	4	%

Reduct		9,300,000		—		9,300,000	7	%		—		3,500,000		12,800,000	8	%

Total		66,747,051		59,943,801		126,690,852	100	%		5,532,405		24,035,652		156,258,909	100	%

SCHEDULE 5(b)

Except as provided below the company is currently not under any obligation and has not granted any rights to register under the Securities Act of 1933 any of its presently outstanding securities or any of its securities that may be subsequently issued:

The Agreement and Plan of Merger dated March 25, 2008 by and among Kayenta Kreations, Inc. (the predecessor to the Company), Kayenta Subsidiary Corp., Geospatial Mapping Systems, Inc., and Thomas G. Kimble, an individual;

The Subscription and Purchase Agreement entered into on October 1, 2009 by and among the Company and certain investors pursuant to which the Company issued to such investors 2,300,000 shares of common stock and pursuant to which the Company granted to such investors certain registration rights set forth therein;

The Subscription and Purchase Agreement entered into on December 15, 2009 by and among the Company and certain investors pursuant to which the Company issued to such investors 1,575,000 shares of Series A Convertible Preferred Stock and pursuant to which the Company granted to such investors certain registration rights set forth therein;

The Subscription and Purchase Agreement entered into on March 19, 2010 by and among the Company and certain investors pursuant to which the Company issued to such investors 9,589,771 shares of common stock and pursuant to which the Company granted to such investors certain registration rights set forth therein;

The Subscription and Purchase Agreement entered into on April 6, 2010 by and among the Company and certain investors pursuant to which the Company issued to such investors 112,000 shares of common stock and pursuant to which the Company granted to such investors certain registration rights set forth therein;

The Subscription and Purchase Agreement entered into on October 15, 2010 by and among the Company and certain investors pursuant to which the Company issued to such investors $1,155,000 of 10% Senior Convertible Redeemable Notes, and pursuant to which the Company granted to such investors certain registration rights set forth therein.

The Subscription and Purchase Agreement to be entered into by and among the Company and certain investors pursuant to which the Company agrees to issue to such investors Series B Convertible Stock, and pursuant to which the Company will grant to such investors certain registration rights set forth therein.

Geospatial Corporation S-1

Exhibit 10.18

PROMISSORY NOTE

$150,000

November 21, 2012

FOR VALUE RECEIVED, UNDERSIGNED GEOSPATIAL HOLDINGS, INC., a corporation organized under the laws of the State of Nevada (the “ Borrower ”), promises to pay to the order of Matthew F. Bensen, an individual residing in the Commonwealth of Virginia (the “ Lender ”), at such place as the Lender may from time to time designate in writing, the outstanding principal sum of One Hundred Fifty Thousand Dollars ($150,000.00), with interest payable as hereinafter set forth. Principal shall be payable in lawful money which shall be legal tender in payment of all debts, public and private.

Interest shall accrue at an annual rate of ten percent (10%) of the unpaid principal sum based on a three hundred and sixty (360) day year. Principal and accrued interest shall be payable in a lump sum on or before February 1, 2013 (the “ Due Date ”). The Borrower may prepay the principal and accrued interest in whole or in part at any time. The Lender may, at any time, convert any part of the unpaid principal and accrued interest to shares of the Borrower’s Series B Convertible Preferred Stock (“ Series B Stock ”) at a price of $0.70 per share of Series B Stock.

Additional interest shall be payable as follows: If the principal and accrued interest are paid on or before January 2, 2013, the Borrower shall issue 42,857 shares of the Borrower’s Series B Stock to the Lender as additional interest. If the principal and accrued interest are paid after January 2, 2013 and on or before January 15, 2013, the Borrower shall issue 57,142 shares of the Borrower’s Series B Stock to the Lender as additional interest. If the principal and accrued interest are paid after January 15, 2013 and on or before the Due Date, the Borrower shall issue 71,428 shares of the Borrower’s Series B Stock to the Lender as additional interest.

In the event that the principal and accrued interest are not paid on the Due Date, the Borrower shall issue 2,142 shares of Series B Stock to the Lender per day until the principal and accrued interest paid.

Upon execution of this Note, the Lender shall execute a Preferred Stock and Warrant Purchase Agreement, and Form W-9. The Borrower shall issue a Form 1099 to the Lender consistent with its obligations under applicable law.

This Note shall be governed, construed and interpreted strictly in accordance with the laws of the State of Nevada.

The Borrower agrees that any suit, action, or proceeding, whether claim or counterclaim, brought or instituted by Borrower or any successor or assign of Borrower on or with respect to this Note or which in any way relates, directly or indirectly, to the obligations of Borrower to Lender under this Note, or the dealings of the parties with respect thereto, shall be tried only by a court and not by a jury. Borrower hereby expressly waives any right to a trial by jury in any such suit, action or proceeding. Borrower acknowledges and agrees that this provision is a specific and material aspect of the agreement between the parties and that the Lender would not enter into the transaction with the Borrower if this provision were not part of their agreement.

In the event that any one or more of the provisions of this Note shall for any reason be held to be invalid, illegal or unenforceable, in whole or in part or in any respect, or in the event that any one or more of the provisions of this Note operate or would prospectively operate to invalidate this Note, then and in either of those events, such provision or provisions only shall be deemed null and void and shall not affect any other provisions (or remaining part of the affected provision) of this Note, and the remaining provisions (or remaining part of the affected provision) of this Note shall remain operative and in full force and effect and shall in no way be affected, prejudiced or disturbed thereby.

Borrower waives presentment, protest and demand, notice of protest, notice of demand and of dishonor and of non-payment of this Note, and expressly agrees that this Note or any payment hereunder may be extended from time to time without in any way affecting the liability of Borrower.

WITNESS the signature and seal of Borrower as of the day and year first above written.

WITNESS:	GEOSPATIAL HOLDINGS, INC.

/s/ Thomas R. Oxenreiter	By:	/s/ Mark A. Smith (SEAL)
	Mark A. Smith, President

Geospatial Corporation S-1

Exhibit 10.19

SETTLEMENT AGREEMENT

This SETTLEMENT AGREEMENT (the “Agreement”) is dated this 25 ^th day of May, 2012 and is by and between Joseph Timothy Nippes , an adult individual with an address at 809 Smith Road, Homer City, PA 15748 (“Nippes”) , Daniel A. Bradley, Jr.¸ an adult individual with an address at 6934 W Planada Lane, Glendale, Arizona 85310 (“Bradley”), Christina Sherwood , an adult individual with an address at 1227 D Gemini Drive, Annapolis, Maryland 21403 (“Sherwood”), Joseph A Lane, an adult individual with an address at 3099 Winnebago Drive, Sedalia, Colorado 80135 (“Lane”), Ronald Peterson , an adult individual with an address at 1501 Shirkey Avenue, Richmond, Missouri 64085(“Peterson”), Timothy Story , an adult individual with an address at 9155 Bent Tree Drive, Peoria, Arizona 85383(“Story”) and Linda Ward an adult individual with an address at 4113 Tartan Court, Murrysville, Pennsylvania 15668 (“Ward; together with Nippes, Bradley, Sherwood, Lane, Peterson and Story, the “Claimants” and sometimes each individually, a “Claimant”), on the one hand, and Geospatial Mapping Systems, Inc. , a Delaware corporation with a principal place of business located at 229 Howes Road, Sarver, Pennsylvania 16066 (“Mapping”), Geospatial Holdings, Inc. a Delaware corporation with a principal place of business located at 229 Howes Road, Sarver, Pennsylvania 16066 (“Holdings”), Mark A. Smith, an adult individual with an address at 1001 Carlisle Street, Natrona Heights, Pennsylvania 15065 (“Smith”), Thomas R. Oxenreiter , an adult individual with an address at 7113 Clubhouse Road, Presto, Pennsylvania 15142 (“Oxenreiter”), Timothy F. Sutherland, an adult individual who resides at 3191 Landmark Road, The Plaines, Virginia 20198 (“Sutherland”) and Thomas Ridge , an adult individual with an address at 5315 Woodlawn Avenue, Chevy Chase, Maryland 20815 (“Ridge;” together with Mapping, Holdings, Smith, Oxenreiter and Sutherland, the “Geospatial Parties”).

BACKGROUND

WHEREAS, the Claimants filed a civil suit against the Geospatial Parties in the Court of Common Pleas of Allegheny County in the matter styles Nippes et al. v. Geospatial Mapping Systems, Inc. et al. , No. GD 12-005210 (the “Civil Action”);

WHEREAS, to avoid the expense and rigors associated with the Civil Action, the Claimants and Geospatial Parties have agreed to resolve their differences pursuant to the terms and subject to the conditions set forth herein.

NOW, THEREFORE, incorporating the Background section herein, for good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

1. Undertakings of Geospatial Parties .

(a) On or prior to June 1, 2012, Mapping shall pay to Nippes the sum of $4,000 as reimbursement in full for legal fees and costs paid by Nippes on behalf of the Claimants in connection with the Civil Action.

(b) For settlement purposes only, Mapping acknowledges and agrees to pay to each Claimant an amount attributable to “wages,” “expense reimbursements” and “interest,” all as more fully set forth in the schedule attached hereto and incorporated herein by reference as Exhibit “A” (the “Payment Schedule”) as follows:

(1) On or prior to July 1, 2012, Mapping shall pay to each Claimant (except for Sherwood) an amount equal to 10% of the sum of each Claimant’s “wages,” “expense reimbursements” and “interest” thereon, all as more fully set forth on the Payment Schedule. The precise payments to be made appear under the column entitled “10% Payment Due July 1.”

(2) On or prior to August 1, 2012, Mapping shall pay to each Claimant (except for Sherwood) an amount equal to 5% of the sum of each Claimant’s “wages,” “expense reimbursements” and “interest” thereon, all as more fully set forth on the Payment Schedule. The precise payments to be made appear under the column entitled “5% Payment Due Aug 1.”

(3) Commencing on September 1, 2012, Mapping shall pay each Claimant (except for Sherwood) the balance of their respective claims (i.e., “wages,” “expense reimbursements” and “interest” less the payments made in subsections (b)(1) and (b)(2) above) with interest at the annual rate of 4% amortized over a 60-month period in equal monthly payments with a balloon payment on August 1, 2015 consisting of the outstanding principal balance owing at that time. The precise monthly payments and balloon payment to be made appear under the column entitled “36 Monthly Payments” and “Balloon Payment,” respectively.

(4) With respect only to Sherwood, on July 1, 2012, Mapping shall pay Sherwood an amount equal to 25% of the sum of her “wages,” “expense reimbursements” and “interest.” The balance of Sherwood’s claim shall be amortized and paid in equal monthly payments over a twelve-month period commencing on August 1, 2012 with interest at 4% per annum. The precise 25% payment and monthly payments to be made appear under the column entitled “Total Due as of July 1” and “36 Monthly Payments,” respectively.

(c) For purposes of characterizing the payments being made to each Claimant, the principal portion of all such payments shall be allocated and paid towards each Claimant’s “expense reimbursement” first and then as “wages.” Once Mapping begins paying “wages” to any Claimant, Mapping will be responsible to deduct and withhold taxes therefrom and otherwise issue a form W-2 to said Claimant consistent with its obligations under applicable law. Upon completion and satisfaction of Mapping’s payment obligations set forth in Section 1(a) and (b) above, each Claimant acknowledges and agrees that he/she has been paid in full for any and all obligations arising out of said Claimant’s employment by Mapping and that he/she has no unsatisfied claims against any of the Geospatial Parties or any other third party arising from, related to or in any way connected with his/her employment by Mapping.

2. Undertakings of Claimants .

(a) Within five business days after receipt of the payments set forth in Section 1(b)(1) and 1(b)(2) above, the Claimants will file a Praecipe to Discontinue Without Prejudice the Civil Action as to all of the Geospatial Parties and thereafter shall refrain from pursuing any of the Geospatial Parties or any other third party for the claims that were raised or that could have been raised in the Civil Action unless and until there is an “Event of Default” (hereafter defined). Notwithstanding the foregoing, by dismissing the Civil Action, the Claimants are not waiving the right to refile an action against the Geospatial Parties upon the occurrence of an “Event of Default” (hereinafter defined), and the Geospatial Parties are not waiving any of the defenses that they have to such claim or claims.

(b) Since this Agreement does not provide for the immediate discontinuance of the Civil Action, upon and after the execution of this Agreement by all of the parties hereto, Claimants shall be deemed to have extended the applicable response period for all of the Geospatial Parties until ten days after the occurrence of an “Event of Default” (hereinafter defined).

3. Conditional Mutual Release . Effective only upon completion and satisfaction of Mapping’s payment obligations set forth in Sections 1(a) and 1(b) above, the Claimants, on the one hand, and the Geospatial Parties, on the other hand, each on behalf of himself/herself/itself and any person or entity claiming by, through or under him/her/it, hereby unconditionally remises, releases and forever discharges the other, including, with respect to any individual being released, their respective executor, administrator, heir or beneficiary, and with respect to any entity being released, their respective, officers, directors, shareholders, employees, affiliates, subsidiaries and parent corporation, as well the agents and permitted successors and assigns of any of the foregoing, of and from any and all manner of actions, causes of action, suits, debts, dues, accounts, bonds, covenants, contracts, agreements, promises, warranties, guaranties, representations, liens, judgments, claims, counterclaims, cross claims, defenses and/or demands whatsoever, including claims for contribution and/or indemnity, whether now known or unknown, past or present, asserted or unasserted, contingent or liquidated, at law or in equity, or resulting from any assignment, if any, which any of them ever had or now have against the other, for or by reason of any cause, matter or thing whatsoever, arising from the beginning of time to the date of execution of this Agreement with respect to, in connection with or in any way related to the employment relationship between each of the Claimants and Mapping. Each party warrants and represents to the other that he/she/it has not assigned, pledged, hypothecated and/or otherwise divested himself/herself/itself and/or encumbered all or any part of the claims being released hereby and that he/she/it hereby agrees to indemnify and hold harmless the other against any party who asserts or claims that such an assignment, pledge, hypothecation, divestiture and/or encumbrance was made.

4. Event of Default; Remedies . If Mapping fails to make any of the payments required pursuant to Sections 1(a) or 1(b) and fails to cure same within ten days of receipt of written notice by or on behalf of the Claimant or Claimants who did not receive a timely payment, an “Event of Default” shall occur hereunder. Upon and after the occurrence of an Event of Default, the Claimant who did not receive payment (after proper notice and cure was

afforded to Mapping) shall have all rights and remedies to pursue any unpaid obligations owing to him/her, including, without limitation, the right to re-file a lawsuit to recover any amounts alleged to be owed to such Claimant. For purposes of this Agreement, written notice of any failure to receive payment shall be sent by facsimile, e-mail or overnight mail as follows: Geospatial Mapping Systems, Attn.: Mark Smith, 229 Howes Run Road, Sarver, PA 16055 (fax no. (724) 353-3049) (email address mark@geospatialcorporation.com); and to Geospatial Mapping Systems, Inc., Attn.: Thomas Oxenreiter, 229 Howes Run Road, Sarver, PA 16055 (fax no. (724) 353-3049) (email address toxenreiter@geospatialcorporation.com) with a copy to David B. Smith, Esquire, Smith Kane, LLC, 112 Moores Road, Malvern, PA 19355 (fax no. (610) 407-7218) (e-mail address dsmith@smithkanelaw.com).

5. Amendments . Any amendment to this Agreement shall be made in writing and signed by the parties hereto.

6. Severability . The provisions of this Agreement will, to the greatest extent possible, be interpreted in such a manner as to comply with applicable law, but if any provision hereof is, notwithstanding such interpretation, determined to be invalid, void or unenforceable, the remaining provisions of this Agreement will not be affected thereby but will remain in full force and effect and be binding upon the parties hereto, unless the deletion of such invalid, void or unenforceable provision or provisions would result in such a material change as to cause the continuation of this Agreement to be unreasonable.

7. Assignment . The rights and obligations of the parties hereto under this Agreement shall inure to the benefit of, and shall be binding upon, their respective successors and assigns; provided, however, that no party may assign that party’s rights or responsibilities hereunder with the written consent of all other parties hereto.

8. Counterparts . This Agreement may be signed by each party hereto by facsimile or in .pdf format and in several counterparts, in which event all such counterparts shall constitute one agreement, binding on all the parties hereto.

9. Governing Law . Each party agrees that the formation, interpretation and performance of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania excluding its conflict of law rules. The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any party.

10. Integrated Agreement . Each party agrees that this Agreement sets forth the entire agreement between them on this subject and supersedes all other oral and written understandings or agreements between the parties regarding the subject matter of this Agreement. The terms of this Agreement are contractual and not mere recitals. All heading, titles and similar items are provided for the purpose of reference and convenience and are not intended to affect the meaning, content or scope of this Agreement.

11. Representation by Counsel . Each party hereto acknowledges that he/she/it hashad the benefit of legal counsel of his/her/its own choice and has been afforded an opportunity to review this Agreement with his/her/its legal counsel (or has been advised that he/she/it should have legal counsel and has voluntarily declined to engage legal counsel) and agrees that this Agreement shall be construed as if jointly drafted by all the parties hereto. This Agreement constitutes a settlement or compromise of claims and is therefore not intended to be and shall not be construed to be or used as an admission as to liability or damages.

12. Further Assurances . Each of the parties hereto agrees that he/she/it will take all such actions and execute and deliver any document, instrument and/or agreement as may be reasonably necessary from time to time to effect the provisions of this Agreement.

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

ATTEST	GEOSPATIAL MAPPING SYSTEMS, INC.

/s/ Thomas R. Oxenreiter	By:	/s/ Mark A. Smith
		Name: Mark A. Smith
		Title: CEO

ATTEST	GEOSPATIAL HOLDINGS, INC.

/s/ Thomas R. Oxenreiter	By:	/s/ Mark A. Smith
		Name: Mark A. Smith
		Title: CEO

WITNESS

/s/ Thomas R. Oxenreiter	By:	/s/ Mark A. Smith
	Mark A. Smith

WITNESS

/s/ Mark A. Smith			/s/ Thomas R. Oxenreiter
			Thomas R. Oxenreiter

WITNESS

			/s/ Timothy F. Sutherland
			Timothy F. Sutherland

WITNESS

/s/ Susan C. Galen_			/s/ Thomas Ridge
			Thomas Ridge

WITNESS

			/s/ Joseph Timothy Nippes
			Joseph Timothy Nippes

WITNESS

/s/ Melinda Bradley			/s/ Daniel A. Bradley, Jr.
			Daniel A. Bradley, Jr.

WITNESS

/s/ Tim Nippes			/s/ Christina Sherwood
			Christina Sherwood

WITNESS

			/s/ Joseph A. Lane
			Joseph A. Lane

WITNESS

/s/ Piper Peterson			/s/ Ronald Peterson
			Ronald Peterson

WITNESS

/s/ Dana Story			/s/ Timothy Story
			Timothy Story

WITNESS

/s/ Dorothy Z. Reddick			/s/ Linda Ward
			Linda Ward

Geospatial Corporation S-1

Exhibit 21.1

The following table sets forth the Registrant’s subsidiaries and the jurisdiction of incorporation or organization of each. Each subsidiary is 100% owned by the Registrant.

Subsidiary		Jurisdiction
Geospatial Mapping Systems, Inc.		Delaware
Utility Services and Consulting Corporation		Nevada

Geospatial Corporation S-1

Exhibit 23.1

Geospatial Corporation

229 Howes Run Road

Sarver, PA 16055

We hereby consent to the use in the Prospectus constituting a part of this Registration Statement of our report dated March 25, 2014, relating to the consolidated financial statements of Geospatial Corporation, which are contained in that Prospectus.

We also consent to the reference to us under the caption “Experts” in the Prospectus.

Goff Backa Alfera & Company, LLC

Pittsburgh, PA

March 25, 2014