PROXY
Exhibit
11
PROXY
THIS
PROXY (this “Proxy”),
dated
as of June 19, 2007, is made and entered into by and among Kronos Advanced
Technologies, Inc., a Nevada corporation (“Company”),
and
each of the undersigned holders of securities of the Company who are signatories
hereto (each, a “Security
Holder”).
WHEREAS,
contemporaneously with the execution of this Agreement, the Company and each
Security Holder have entered into a Voting Agreement of even date herewith
(the
“Voting
Agreement”)
pursuant to which each Security Holder has agreed to vote (i) in favor of a
slate of directors of the Company’s board of directors as proposed by AirWorks
Funding LLLP (“AirWorks”),
subject to the composition of such slate’s compliance with all applicable laws
and regulations, (ii) in favor of adjusting the size of the Company’s board of
directors such that upon the election of the slate of directors proposed by
AirWorks, such directors hold a majority of the seats on the Company’s board of
directors, (iii) in favor of approving an amendment to the Company’s articles of
incorporation to increase the Company’s authorized common stock to a number of
shares necessary to allow the Lenders (as below defined) to convert the entire
amount of the Financing (as below defined) into shares of common stock of the
Company as provided in the Funding Agreement (as below defined), (iv) in favor
of reincorporating the Company in Delaware, subject to the Company’s board of
director’s recommendation of such action (v) in favor of a reverse stock split
proposed by AirWorks or the Company’s board of directors and (vi) against any
action or transaction that may reasonably be expected to impede, interfere
with,
delay, postpone or attempt to discourage the consummation of any of the
foregoing., or refrain from taking, certain actions to allow the Company to
obtain secured convertible debt financing from AirWorks and other individuals
and entities (AirWorks
and such other individuals and entities are collectively referred to herein
as,
the “Lenders”)
in an
amount up to $18,159,000 (the “Financing”)
pursuant to the terms of that certain Funding Agreement of even date herewith
(the “Funding
Agreement”);
WHEREAS,
each Security Holder owns securities of the Company and desires to enter into
this Proxy pursuant to which he, she or it agrees, among other things, that
Xxxxxxx X. Xxxxxxx may vote all of the Subject Shares (as defined in the Voting
Agreement) held by such Security Holder in favor of the actions contemplated
by
the Voting Agreement; and
WHEREAS,
the Lenders would not provide the Financing in the absence of this Proxy, and
the Security Holders hereby acknowledge that each of them will derive a benefit
as a result of the Financing.
NOW,
THEREFORE, in consideration of the foregoing and of the promises,
representations, warranties and agreements contained herein, and intending
to be
legally bound hereby, the parties agree as follows:
1. Proxy.
By
executing this Proxy, each Security Holder hereby irrevocably appoints Xxxxxxx
X. Xxxxxxx, the attorney, agent and proxy for the undersigned and in the name,
place and stead of the undersigned, in respect of any of the matters set forth
in clauses (i) through (vi) of the first “Whereas” clause above set forth, to
vote or, if applicable, to give written consent, with respect to all the Subject
Shares owned by such Security Holder which such
Security
Holder is or may be entitled to vote at any meeting of the Company held after
the date hereof, whether annual or special and whether or not an adjourned
meeting, or, if applicable, to give written consent with respect thereto. This
proxy is coupled with an interest, shall be irrevocable and binding on any
successor in interest of each Security Holder and shall not be terminated by
operation of law upon the occurrence of any event, including the death or
incapacity of any Security Holder. The proxy granted hereby and set forth herein
shall operate to revoke any prior proxy as to the Subject Shares heretofore
granted by any Security Holder. This proxy shall terminate on the Expiration
Date (as defined in the Voting Agreement). This proxy has been executed in
accordance with Section 78.355 of the Nevada Revised Statutes.
2. General
Provisions.
(a) Amendments.
This
Proxy may not be amended except by an instrument in writing signed by each
of
the parties hereto.
(b) Notice.
All
notices, requests, claims, demands and other communications hereunder shall
be
in writing and shall be deemed given if delivered personally or sent by
overnight courier (providing proof of delivery) to each party hereto at his,
her
or its address set forth below such party’s name on the signature page hereto
(or at such address for a party as shall be specified by like
notice).
(c) Interpretation.
When a
reference is made in this Proxy to a Section, such reference shall be to a
Section of this Proxy unless otherwise indicated. The headings contained in
this Proxy are for reference purposes only and shall not affect in any way
the
meaning or interpretation of this Proxy. Wherever the words “include, or
“including” are used in this Proxy, they shall be deemed to be followed by the
words “without limitation.”
(d) Counterparts.
This
Proxy may be executed in one or more counterparts, all of which shall be
considered one and the same agreement, and shall become effective when one
or
more of the counterparts have been signed by each of the parties and delivered
to the other party.
(e) Entire
Agreement; No Third Party Beneficiaries.
This
Proxy (i) constitutes the entire agreement and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to
the
subject matter hereof and (ii) is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.
(f) Governing
Law.
This
Proxy shall be governed by, and construed in accordance with the laws of the
State of New York, regardless of the laws that might otherwise govern under
applicable principles of conflicts of law thereof.
3. Enforcement.
The
parties agree that irreparable damage would occur in the event that any of
the
provisions of this Proxy (including the provisions of Section 2) were not
performed in accordance with their specific terms or were otherwise breached.
It
is accordingly agreed that the parties shall be entitled to specific performance
and injunctive relief to prevent any threatened breach of this
Agreement.
4. Severability.
In the
event that any provisions of this Proxy or the application thereof becomes
or is
declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of this Proxy shall continue in full force and
effect and the application of such provision to other persons or circumstances
will be interpreted so as to effect the intent of the parties hereto. The
parties further agree to replace such void or unenforceable provision of this
Proxy with a valid and enforceable provision that will achieve, to the fullest
extent possible, the original intent of the parties.
5. Fiduciary
Duties.
Each
Security Holder is signing this Proxy solely in such Security Holder’s capacity
as an owner of his, her or its respective securities of the Company and/or
Subject Shares, and nothing in this Proxy shall prohibit, prevent or preclude
such Security Holder from taking or not taking any action in his, her or its
capacity as an officer of director of the Company, to the extent any such action
is not in conflict with provisions hereof.
***************
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as
of the date first written above.
|
COMPANY:
Kronos
Advanced Technologies, Inc.
By:
/s/ Xxxxxxx X. Xxxxxx
Name:
Xxxxxxx X. Xxxxxx
Title:
COO
Address:
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
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STOCKHOLDERS:
|
Security
Holder
|
Subject
Shares
|
|
|
Shares
of Stock Held
by
Security Holder
|
Options
to Purchase
Shares
of Stock Held
by
Security Holder
|
|
|
/s/
Xxxxxx X. Xxxxxx
Xxxxxx
X. Xxxxxx
Address:
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
|
1,201,926
|
7,191,206
|
|
/s/
Xxxxx XxXxxxxxx
Xxxxx
XxXxxxxxx
Address:
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
|
294,118
|
638,459
|
|
/s/
Xxxxxx Xxxxx
Xxxxxx
Xxxxx
Address:
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
|
-
|
573,500
|
|
Security
Holder
|
Subject
Shares
|
|
|
Shares
of Stock Held
by
Security Holder
|
Options
to Purchase
Shares
of Stock Held
by
Security Holder
|
|
|
/s/
Xxxxxxx Xxxxxx
Xxxxxxx
Xxxxxx
Address:
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
|
852,752
|
3,391,756
|
|
/s/
Igor Krichtafovitch
Igor
Krichtafovitch
Address:
00000
XX 00xx
Xxxxxx\
Xxxxxxx,
XX 00000
|
1,053,000
|
4,955,726
|
|
/s/
Xxxxxxx X. Sun
Xxxxxxx
X. Sun
Address:
00000
Xxxxxxxxxx Xxxx
Xxxxxx,
XX 00000
|
4,587,400
|
-
|
|
/s/
Xxxxxxx X. Sun
Xxxxxxx
X. Sun, as attorney-in-fact for
Xxxxxxx
X. Xxxxxxxxx
Address:
00000
Xxxxxx Xxxxx Xxxx
Xxxxxx, XX 00000
|
601,500
|
-
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