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THIS AGREEMENT is entered into as of August 29, 2000, by and between PerfectData Corporation, a California
corporation, with its principal place of business at 110 West Easy Street, Simi Valley, California, 93065-1689 (hereinafter
"CLIENT"), and Terry J. Baker with his principal place of business at 1595 Regatta Road, Laguna beach, California, 92651
(hereinafter "TJB"). CLIENT and TJB are hereinafter referred to as ("The Parties").
W I T N E S S E T H:
In consideration of the promises and mutual covenants hereinafter contained, the parties hereto agree as follows:
TJB shall cause the following consulting services to be performed (hereinafter referred to as "Services").
TJB shall work with CLIENT on the Retail Expansion Project. The specific tasks and deliverables of the Retail Expansion
Project are summarized in the attached Exhibit A.
Compensation and Reimbursement
CLIENT shall pay TJB a fee of $12,500.00 per month times 3 months . CLIENT will also reimburse TJB for
related out-of-pocket expenses (with documented receipts) including but not limited to travel and telephone
expenses. Any expense greater than $250.00 will be pre-approved by CLIENT.
TJB's fees shall include and TJB shall be responsible for the payment of all federal, state and local taxes of any
kind that are attributable to the compensation it receives.
TJB shall be paid according to the following schedule:
TJB agrees to devote a full-time effort for the CLIENT towards the Retail Expansion Project.
CLIENT shall issue to TJB, 60,000 Options to purchase common shares of PerfectData stock (PERF) at an
exercised price of $3.00 per share, which will vest as follows: (i) thirty three percent (33%) of the Shares at the
end of the ninety day period from the date of this Agreement (the " Initial Vesting Date "), (ii) thereafter, the