The document outlines the principal terms of a proposed triangular merger between DeSalt Industries, Inc., a wholly owned subsidiary of Arrowhead Enterprises, Inc., and SeaCatcher Technologies LLC. Key terms include SeaCatcher forming a new subsidiary (SeaCatcher Merger Sub) that will merge with and into DeSalt, with DeSalt surviving as a new entity (NewCo) owned 33% by Arrowhead and 66% by SeaCatcher. The closing date is set for no later than March 11, 2016. Protections for Arrowhead as the minority shareholder are also outlined.

1. Team 2
Arrowhead Enterprises, Inc
TERM SHEET
FOR PROPOSED MERGER OF
DESALT INDUSTRIES, INC. AND SEACATCHER TECHNOLOGIES LLC
[FEBRUARY _, 2016]
This Term Sheet is a summary of certain principal terms of the proposed
triangular merger in which DeSalt Industries, Inc. (“DeSalt”), a wholly-owned
subsidiary of Arrowhead Enterprises, Inc. (“Arrowhead”), a Delaware corporation,
would be merged into a newly-formed subsidiary (“SeaCatcher Merger Sub”) of
SeaCatcher Technologies LLC, a Delaware corporation (“SeaCatcher”). A binding
agreement or commitment with respect to the transaction proposed hereby will not
exist unless and until DeSalt and SeaCatcher (together, the “Parties”) have
negotiated, approved, executed and delivered definitive agreements; provided,
however, that the Parties shall be bound by the obligations in accordance with the
provisions titled “No Shop”, “Confidentiality”, “Governing Law” and “Dispute
Resolution” as set forth hereinafter.
Formation of
SeaCatcher
Merger Sub
SeaCatcher shall cause SeaCatcher Merger Sub to be
organized under the laws of the State of Delaware.
Merger and
Effect of the
Merger
SeaCatcher Merger Sub shall be merged with and into DeSalt
(“Merger”), and DeSalt shall be the surviving corporation of
the Merger (such surviving corporation, “NewCo”). NewCo
shall succeed to and possess all the assets, properties, rights,
privileges, powers, franchises, immunities and purposes, and
be subject to all the debts, liabilities, obligations, restrictions
and duties of both DeSalt and SeaCatcher Merger Sub, all
without further act or deed. As a result of the Merger,
Arrowhead will own 33% and SeaCatcher will own 66% of
NewCo.
Closing Date The closing of the transactions contemplated hereby (the
“Closing”) shall take effect no later than March 11, 2016 (the
“Closing Date”).
Directors and
Officers
At the time of the Merger, the directors and officers of NewCo
shall be appointed and serve in accordance with the Articles
of Incorporation and Bylaws of NewCo, which stipulate that
the initial board of directors will be comprised of an
Arrowhead representative, a SeaCatcher representative, and
Rachel Jones. Rachel Jones shall be Chief Executive Officer
unless and until Arrowhead authorizes her removal or she
resigns her position willfully. As compensation, Rachel Jones
will receive a base salary of $250,000 per annum and a 15%

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equity package on a four (4) year vesting schedule with a one
(1) year cliff and quarterly thereafter.
Merger
Consideration
As a result of the Merger, all outstanding shares of DeSalt
Common Stock and SeaCatcher Merger Sub Common Stock
will be converted into NewCo Common Stock. Each share
shall be converted into the right to receive shares of NewCo
Common Stock at an Exchange Ratio that will result in the
issuance of 100,000 NewCo Common Stock to Arrowhead and
200,000 NewCo Common Stock to SeaCatcher, and will be
referred to herein as the “Merger Consideration.”
Minority
Shareholder
Protections
All standard minority shareholder protections shall be
incorporated into the Merger. Arrowhead shall have the right
(1) to appoint one director for every three on the Board of
Directors, (2) to exercise preemptive rights to acquire
proportional amounts of NewCo's unissued shares upon any
future issuance, and (3) of first refusal to purchase or acquire
any share being sold, transferred, or otherwise disposed of by
any other shareholder. In addition, Arrowhead has the right
to veto (1) any changes in senior management (2) any sale of
major assets, and (3) any creation or cessation of projects or
product lines.
Additional
Financing
In the event that NewCo requires operational capital
following the execution of the Merger, Arrowhead shall issue
a Convertible Promissory Note for up to $250,000 with a
maturity date of 36 months from date of issuance and secured
against all NewCo assets; provided that, NewCo first secures
additional financing from third-party investor(s) of the same
amount. In the event that NewCo achieves Series A financing
resulting in aggregate gross proceeds to the company of at
least $5 million, including conversion of any notes and any
other indebtedness, the Convertible Promissory Note shall
automatically convert all principal and interest accrued under
this note into Series A Preferred Stock at the lower of 70% of
the price per share paid by other purchasers or a maximum
valuation of all the issued and outstanding stock of NewCo of
$20 million.
Employee Terms NewCo will have the right to extend offers of employment to
current employees of Desalt and SeaCatcher that it selects.
The employment terms and conditions offered shall be
determined by NewCo in its sole discretion, subject to the
employment arrangements for Rachel Jones outlined above.
Representations The representations and warranties of the Parties contained

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and Warranties in the definitive agreements, or otherwise made in
connection with the transactions contemplated hereby, shall
be true and correct in all material respects on and as of the
Closing Date except where the failure to perform or comply
with such obligations would not, individually or in the
aggregate, constitute material adverse effect on the Parties as
a whole. (1) None of the Parties are aware of any challenges
(or any basis therefor) with respect to the validity or
enforceability of any Intellectual Property Rights. (2) Other
than with respect to Intellectual Property reasonably
determined by either Party to not have economic value to the
business, none of the Parties have, within the past twelve (12)
months, taken any action or failed to take any action that
could reasonably be expected to result in the abandonment or
cancellation thereof. (3) Other than the representations and
warranties expressly set forth in this Term Sheet, Parties
shall not be deemed to have made any other representation
or warranty in connection with this Agreement or the
transactions contemplated hereby.
Intellectual
Property
(a) As used in this Agreement, “Intellectual Property” means:
(1) inventions (whether or not patentable), trade secrets,
technical data, databases, customer lists, designs, tools,
methods, processes, technology, ideas, know-how, Source
Code, product road maps and other proprietary information
and materials (“Proprietary Information”); (2)
documentation, advertising copy, marketing materials, web-
sites, specifications, mask works, drawings, graphics,
databases, recordings and other works of authorship,
whether or not protected by Copyright (defined herein); (3)
computer programs, including any and all software
implementations of algorithms, models and methodologies,
(4) all forms of legal rights and protections that may be
obtained for, or may pertain to, the Intellectual Property set
forth in clauses (1) through (3) in any country of the world
(“Intellectual Property Rights”), including all letters patent,
patent applications, provisional patents, design patents, PCT
filings, invention disclosures and other rights to inventions or
designs (“Patents”), all registered and unregistered
copyrights in both published and unpublished works
(“Copyrights”), all trademarks, service marks and other
proprietary indicia (whether or not registered) and all
goodwill associated therewith (“Marks”), trade secret rights,
moral rights or other literary property or authors rights, and
all applications, registrations, issuances, divisions,
continuations, renewals, reissuances and extensions of the

4. 4
foregoing.
(b) Following the Merger, NewCo shall own all Intellectual
Property Rights of the Parties free and clear of all liens.
(c) None of the products or services developed,
manufactured, sold, distributed, provided, shipped or
licensed by any of the Parties, in each case related to the
business in which the Parties engage, has infringed or
infringes upon, or otherwise unlawfully used or uses, the non-
Patent Intellectual Property Rights of any third party or, to
the knowledge of Parties, Patents of any third party. None of
the Parties, by conducting business as currently conducted,
have infringed or infringe upon, or otherwise unlawfully used
or use, any Intellectual Property Rights of a third party. None
of the Parties have received any written communication
alleging that any of the Parties have violated or, by
conducting business as currently conducted, would violate,
any Intellectual Property Rights of a third party nor, to the
Parties, is there any basis therefor, in each case which Third
Party Intellectual Property Rights allegations have not been
resolved.
(d) Each of the Parties has taken commercially reasonable
steps to protect and preserve the confidentiality of all non-
public Proprietary Information owned by any of the Parties
used in the Business that is not covered by an issued Patent.
To the Knowledge of the Parties, no employee, consultant or
contractor has been, is or will be, performing services for the
Business in violation of any term of any employment,
invention disclosure or assignment, confidentiality or
noncompetition agreement or other restrictive covenant as a
result of such employee’s, consultant’s or contractor’s
employment or any services rendered by such employee,
consultant or contractor.
(e) Parties have obtained specific assignments from the
inventor(s) with respect to all patents, patent applications,
and invention disclosures that are Intellectual Property used
in the business and that were conceived or developed by
current and former employees of the business. No current or
former employees, consultants, or contractors, of the
business have claimed, asserted, or threatened individual
ownership rights in, under, or to any Intellectual Property
used in the business, nor, to the knowledge of the Parties, is
there any basis therefore.

5. 5
Indemnification (a) DeSalt, SeaCatcher, and Arrowhead shall indemnify, hold
harmless, and defend the other, its parent company,
subsidiaries, affiliates, directors, officers, managers, agents,
representatives, employees, successors, and assigns
(collectively, “Affiliates”) against any liabilities, losses, costs,
damages, or expenses including, without limitation,
reasonable attorney’s fees (collectively, “Losses”), relating to
any claim, cause of action, demand, or suit suffered, incurred,
or arising out of any inaccuracy in or breach of any obligation,
warranty, representation, or covenant contained herein.
(b)Neither of the Parties nor their Affiliates shall be liable to
the other for consequential, exemplary, incidental, indirect, or
special damages of any kind, whether as a result of loss of
present or prospective profits, anticipated sales,
expenditures, investments, or commitments made in
connection with this Agreement.
(c) Each indemnified party shall take, and cause its Affiliates
to take, all reasonable steps to mitigate any Loss upon
becoming aware of any event or circumstance that would be
reasonably expected to, or does, give rise thereto, including
incurring costs only to the minimum extent necessary to
remedy the breach that gives rise to such Loss.
(d) The representations and warranties of the Parties
contained in the definitive agreements shall survive the
Closing for, and all claims for indemnification in connection
therewith shall be asserted not later than, twelve (12)
months following the Closing Date.
(e) Nothing in this Agreement shall limit any party’s right to
seek and obtain equitable relief to which any party shall be
entitled or to seek any remedy on account of any party’s
fraudulent, criminal, or intentional misconduct.

6. 6
“No-Shop” From now until the earlier of March 11, 2016 or the Closing
Date of the Merger, neither of the Parties , nor any of its
Affiliates or their respective legal and financial advisors, shall
initiate, solicit, entertain, negotiate, accept, discuss, or
knowingly encourage, directly or indirectly, any proposal or
offer by any person or entity regarding any sale, license,
merger, consolidation, liquidation, dissolution, public
offering, recapitalization, issuance of securities or similar
transaction involving either company.
Confidentiality All Parties shall keep confidential the terms and details of this
Term Sheet until the definitive agreements have been
executed; provided that a Party (or its parent company) may
disclose such information to the extent reasonably necessary
to comply with any applicable laws, rules and regulations,
including SEC rules and regulations and the rules of the stock
exchange upon which a Party’s (or its parent company’s)
shares are traded, and DeSalt (through its parent company,
Arrowhead) may disclose terms and details of the Term Sheet
in a press release approved in advance by SeaCatcher, such
approval not to be unreasonably withheld, conditioned or
delayed.
Governing Law The laws of the State of Delaware shall govern this Term
Sheet and the definitive agreements contemplated hereby,
without regard to conflicts of laws principles.
Dispute
Resolution
Any dispute or controversy arising out of or relating to this
Merger, its construction, the validity of patent claims or
intellectual property agency or an actual or alleged breach of
this Merger, shall be decided by arbitration, conducted in the
city of Dover, Delaware in accordance with the Arbitration
Rules of the Federal Arbitration Association. The arbitration
panel will include members knowledgeable in the evaluation
of mergers and acquisitions and intellectual property law as
well as those with relevant technical background. The use of
any method of alternative dispute resolution will not be
construed by either party in a manner that would adversely
affect the other party’s rights in a tribunal. Nothing in this
section will prevent one party from resorting to tribunal
proceedings if good faith efforts to resolve a dispute have
been unsuccessful or if injunctive relief is necessary to
prevent serious and irreparable harm to one party or third
parties.

7. 7
The foregoing terms and conditions are acceptable to the parties signing below as a
basis for proceeding with the work that must be completed before the transaction
described in this term sheet can be consummated.
By:____________________________________________
Title:
For: ARROWHEAD ENTERPRISES INC
By: ____________________________________________
Title:
For: SEACATCHER ENTERPRISES LLC