EXHIBIT 10.7
CONSULTING AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into on
April 17, 2007 by and between Third-Order Nanotechnologies, Inc.,
a Nevada Corporation (the "Company") and Xxxxxx X. Xxxxxxx, an
individual (the "Consultant"). The Company and the Consultant
shall hereinafter collectively be referred to as the "Parties"
and generically as a "Party."
ARTICLE ONE
RETENTION
1.1 Duties.
-------
The Company hereby engages and retains the Consultant to act
as the Company's Chief Executive Officer. Specifically,
Consultant's duties shall be to prepare the Company for the
commercialization of fiber optic communications components that
are based on the Company's polymer lightwave switching
technology. In this capacity, subject to the control of the
board of directors, Consultant shall have general supervision,
direction and control of that aspect of the business and affairs
of the Company. Additionally, Consultant shall have such other
powers and duties as may be assigned by the board of directors.
Consultant shall perform the services necessary to complete
his duties hereunder in a timely and professional manner
consistent with industry standards, and at a location, place and
time which Consultant deems appropriate. Consultant's duties
hereunder are non-assignable.
Consultant agrees to use best efforts to segregate work
performed under this Agreement from all work done at, or for, any
such other person, company, corporation, other commercial
enterprise, and/or other institution.
Consultant agrees to comply with all applicable laws and
regulations relating to its performance of services pursuant to
this Agreement.
1.2 Term.
-----
The term of this Agreement shall be twelve (12) months and
shall be deemed to have commenced on April 5, 2007. This
Agreement may be terminated at any time by any party with forty-
five (45) days notice to the other party. The termination of this
Agreement for any reason at any time shall not affect the
Consultant's continuing obligations to the Company under Articles
Three thru Seven.
ARTICLE TWO
CONSULTANT'S COMPENSATION
2.1 Compensation.
-------------
As compensation for the services provided to the Company by
the Consultant under this Agreement, the Consultant shall receive
from the Company.
As compensation for the services provided to the Company by
the Consultant under this Agreement, the Consultant shall receive
from the Company: (i) twelve thousand ($12,000) dollars per
month, due and payable on the 15th day of each month, with the
first payment due upon the full execution of this agreement; and
(ii) a warrant to purchase up to three-hundred thousand (300,000)
shares of the Company's common stock, par value $.001 per share
(the "Common Stock"), at a purchase price of Twenty-Five Cents
($0.25) per share, which shall be exercisable pursuant to the
warrant agreement attached as Exhibit A.
---------
Consultant is solely obligated to formally report as his
income all compensation received from Company for Consultant's
services. Consultant agrees to indemnify Company and hold it
harmless to the extent Consultant is alleged or determined to be
obligated or liable to pay any tax, including but not limited to
payroll, FICA and social security withholding, and unemployment,
disability and/or worker's compensation insurance or similar item
in connection with any payment made to Consultant. Consultant
shall not be entitled to compensation from Company except as set
forth in this Agreement and in no event shall Consultant be
entitled to any fringe benefits available to employees of
Company. Consultant waives any rights Company may now or in the
future have in such fringe benefits even if Consultant is later
deemed a "common law employee."
2.2 Reimbursement for Business Expenses.
-----------------------------------
Subject to the prior approval of the Company, the Company
shall promptly pay or reimburse Consultant for all reasonable
business expenses incurred by Consultant in performing
Consultant's duties and obligations under this Consulting
Agreement, but only if Consultant properly accounts for expenses
in accordance with the Company's policies.
ARTICLE THREE
TRADE SECRETS/INTELLECTUAL PROPERTY RIGHTS
3.1. Proprietary Information.
-----------------------
Consultant agrees during the term of this Agreement and
thereafter that it will take all steps reasonably necessary to
hold Company's Proprietary Information (as defined below) in
trust and confidence, will not use Proprietary Information in any
manner or for any purpose not expressly set forth in this
Agreement, and will not disclose any such Proprietary Information
to any third party without first obtaining Company's express
written consent on a case-by-case basis. By way of illustration
but not limitation "Proprietary Information" includes (a) trade
secrets, inventions, mask works, ideas, processes, formulas,
source and object codes, data, programs, other works of
authorship, know-how, improvements, discoveries, developments,
designs and techniques (hereinafter collectively referred to as
"Inventions"); and (b) information regarding plans for research,
development, new products, marketing and selling, business plans,
budgets and unpublished financial statements, licenses, prices
and costs, suppliers and customers; and (c) information regarding
the skills and compensation of other employees of Company.
Notwithstanding the other provisions of this Agreement, nothing
received by Consultant will be considered to be Company
Proprietary Information if (1) it has been published or is
otherwise readily available to the public other than by a breach
of this Agreement; (2) it has been rightfully received by
Consultant from a third party without confidential limitations;
(3) it has been independently developed for Consultant by
personnel or agents having no access to the Company Proprietary
Information; or (4) it was known to Consultant prior to its first
receipt from Company.
3.2. Third Party Information.
-----------------------
Consultant understands that Company has received and will in
the future receive from third parties confidential or proprietary
information ("Third Party Information") subject to a duty on
Company's part to maintain the confidentiality of such
information and use it only for certain limited purposes.
Consultant agrees to hold Third Party Information on confidence
and not to disclose to anyone (other than Company personnel who
need to know such information in connection with their work for
Company) or to use, except in connection with Consultant's work
for Company, Third Party Information unless expressly authorized
in writing by an officer of Company.
3.3. No Conflict of Interest.
-----------------------
Consultant agrees during the term of this Agreement not to
accept work or enter into a contract or accept an obligation,
inconsistent or incompatible with Consultant's obligations under
this Agreement or the scope of services rendered for Company.
Consultant warrants that to the best of his knowledge, there is
no other existing contract or duty on Consultant's part
inconsistent with this Agreement, unless a copy of such contract
or a description of such duty is attached to this Agreement as
Exhibit B. Consultant further agrees not to disclose to Company,
----------
or bring onto Company's premises, or induce Company to use any
confidential information that belongs to anyone other than
Company or Consultant.
3.4. Disclosure of Work Product.
--------------------------
As used in this Agreement, the term "Work Product" means any
Invention, whether or not patentable, and all related know-how,
designs, mask works, trademarks, formulae, processes,
manufacturing techniques, trade secrets, ideas, artwork, software
or other copyrightable or patentable works, information regarding
plans for research, development, new products, marketing and
selling, business plans, budgets and unpublished financial
statements, licenses, prices and costs, suppliers and customers.
Consultant agrees to disclose promptly in writing to Company, or
any person designated by Company, all Work Product which is
solely or jointly conceived, made, reduced to practice, or
learned by Consultant in the course of any work performed for
Company herein or otherwise ("Company Work Product"). Consultant
represents that any Work Product relating to Company's business
or any Project which Consultant has made, conceived or reduced to
practice at the time of signing this Agreement ("Prior Work
Product") has been disclosed in writing to Company and attached
to this Agreement as Exhibit C. If disclosure of any such Prior
---------
Work Product would cause Consultant to violate any prior
confidentiality agreement, Consultant understands that it is not
to list such Prior Work Product in Exhibit C but it will disclose
---------
a cursory name for each such invention, a listing of the
party(ies) to whom it belongs, and the fact that full disclosure
as to such Prior Work Product has not been made for that reason.
A space is provided in Exhibit C for such purpose.
---------
3.5. Ownership of Work Product.
-------------------------
Consultant shall specifically describe and identify in
Exhibit C all technology which (a) Consultant intends to use in
---------
performing under this Agreement, (b) is either owned solely by
Consultant or licensed to Consultant with a right to sublicense
and (c) is in existence in the form of a writing or working
prototype prior to the Effective Date ("Background Technology").
Consultant agrees that any and all Inventions conceived, written,
created or first reduced to practice in the performance of work
under this Agreement shall be the sole and exclusive property of
Company.
3.6. Assignment of Company Work Product.
----------------------------------
Except for Consultant's rights in the Background Technology,
Consultant irrevocably assigns to Company all right, title and
interest worldwide in and to the Company Work Product and all
applicable intellectual property rights related to the Company
Work Product, including without limitation, copyrights,
trademarks, trade secrets, patents, moral rights, contract and
licensing rights (the "Proprietary Rights"). Consultant retains
no rights to use the Company Work Product and agrees not to
challenge the validity of Company's ownership in the Company Work
Product.
3.7. Waiver or Assignment of Other Rights.
------------------------------------
If Consultant has any rights to the Company Work Product
that cannot be assigned to Company, Consultant unconditionally
and irrevocably waives the enforcement of such rights, and all
claims and causes of action of any kind against Company with
respect to such rights, and agrees, at Company's request and
expense, to consent to and join in any action to enforce such
rights. If Consultant has any right to the Company Work Product
that cannot be assigned to Company or waived by Consultant,
Consultant unconditionally and irrevocably grants to Company
during the term of such rights, an exclusive, irrevocable,
perpetual, worldwide, fully paid and royalty-free license, with
rights to sublicense through multiple levels of sublicensees, to
reproduce, create derivative works of, distribute, publicly
perform and publicly display by all means now known or later
developed, such rights.
3.8. Assistance.
----------
Consultant agrees to cooperate with Company or its
designee(s), both during and after the term of this Agreement, in
the procurement and maintenance of Company's rights in Company
Work Product and to execute, when requested, any other documents
deemed necessary by Company to carry out the purpose of this
Agreement. Consultant agrees to execute upon Company's request a
signed transfer of copyright to Company in the form attached to
this Agreement as Exhibit D for all Company Work Product subject
---------
to copyright protection, including, without limitation, computer
programs, notes, sketches, drawings and reports.
3.9. Enforcement of Proprietary Rights.
---------------------------------
Consultant will assist Company in every proper way to
obtain, and from time to time enforce, United States and foreign
Proprietary Rights relating to Company Work Product in any and
all countries. To that end Consultant will execute, verify and
deliver such documents and perform such other acts (including
appearances as a witness) as Company may reasonably request for
use in applying for, obtaining, perfecting, evidencing,
sustaining and enforcing such Proprietary Rights and the
assignment thereof. In addition, Consultant will execute, verify
and deliver assignments of such Proprietary Rights to Company or
its designee. Consultant's obligation to assist Company with
respect to Proprietary Rights relating to such Company Work
Product in any and all countries shall continue beyond the
termination of this Agreement, but Company shall compensate
Consultant at a reasonable rate after such termination for the
time actually spent by Consultant at Company's request on such
assistance.
3.10. Execution of Documents.
----------------------
In the event Company is unable for any reason, after
reasonable effort, to secure Consultant's signature on any
document needed in connection with the actions specified in the
preceding sections 3.8 and 3.9, Consultant hereby irrevocably
designates and appoints Company and its duly authorized officers
and agents as its agent and attorney in fact, which appointment
is coupled with an interest, to act for and in its behalf to
execute, verify and file any such documents and to do all other
lawfully permitted acts to further the purposes of the preceding
paragraph with the same legal force and effect as if executed by
Consultant. Consultant hereby waives and quitclaims to Company
any and all claims, of any nature whatsoever, which Consultant
now or may hereafter have for infringement of any Proprietary
Rights assigned hereunder to Company.
ARTICLE FOUR
CONSULTANT REPRESENTATIONS AND WARRANTIES
Consultant hereby represents and warrants that (a) the
Company Work Product will be an original work of Consultant and
any third parties will have executed assignment of rights
reasonably acceptable to Company; (b) neither the Company Work
Product nor any element thereof will infringe the Intellectual
Property Rights of any third party; (c) neither the Company Work
Product nor any element thereof will be subject to any
restrictions or to any mortgages, liens, pledges, security
interests, encumbrances or encroachments; (d) Consultant will not
grant, directly or indirectly, any rights or interest whatsoever
in the Company Work Product to third parties; (e) Consultant has
full right and power to enter into and perform this Agreement
without the consent of any third party; (f) Consultant will take
all necessary precautions to prevent injury to any persons
(including employees of Company) or damage to property (including
Company's property) during the term of this Agreement; (g)
Consultant agrees to abide by any and all rules, policies and
procedures as communicated to Consultant by the Company; (h) to
the extent required by law, the Project shall be performed by
individuals duly licensed and authorized by law to work on the
Project; and (h) should Company permit Consultant to use any of
Company's equipment, tools, or facilities during the term of this
Agreement, such permission shall be gratuitous and Consultant
shall be responsible for any injury to any person (including
death) or damage to property (including Company's property)
arising out of use of such equipment, tools or facilities,
whether or not such claim is based upon its condition or on the
alleged negligence of Company in permitting its use.
ARTICLE FIVE
INDEMNIFICATION
Consultant will indemnify and hold harmless Company, its
officers, directors, employees, sublicensees, customers and
agents from any and all claims, losses, liabilities, damages,
expenses and costs (including attorneys' fees and court costs)
which result from a breach or alleged breach of any
representation or warranty of Consultant (a "Claim") set forth in
Article Four of this Agreement, provided that Company gives
Consultant written notice of any such Claim and Consultant has
the right to participate in the defense of any such Claim at its
expense. From the date of written notice from Company to
Consultant of any such Claim, Company shall have the right to
withhold from any payments due Consultant under this Agreement
the amount of any defense costs, plus additional reasonable
amounts as security for Consultant's obligations under this
Article Five.
ARTICLE SIX
GOVERNMENT OR THIRD PARTY CONTRACTS
6.1 Government Contracts.
--------------------
In the event that Consultant shall perform services under
this Agreement in connection with any Government contract in
which Company may be the supplier, prime contractor or
subcontractor, Consultant agrees to abide by all laws, rules and
regulations relating thereto. To the extent that any such law,
rule or regulation requires that a provision or clause be
included in this Agreement, Consultant agrees that such provision
or clause shall be added to this Agreement and the same shall
then become a part of this Agreement.
6.2 Security.
--------
In the event the services of the Consultant should require
Consultant to have access to Department of Defense classified
material, or other classified material in the possession of
Company's facility, such material shall not be removed from
Company's facility. Consultant agrees that all work performed
under this Agreement by Consultant which involves the use of
classified material mentioned above shall be performed in a
secure fashion (consistent with applicable law and regulations
for the handling of classified material) and only at Company's
facility.
6.3 Ownership.
---------
Consultant also agrees to assign all of its right, title and
interest in and to any Work Product to a Third Party, including
without limitation the United States, as directed by Company.
ARTICLE SEVEN
COVENANT NOT TO COMPETE/NON-SOLICITATION OF CUSTOMERS
Consultant agrees that Consultant will not, at any time
within a period of twenty-four (24) months after the termination
of this Agreement, without the prior written approval of the
Company's board of directors, directly or indirectly, within the
United States or its territories, engage in any business activity
directly or indirectly competitive with the business of the
Company at the time of termination. In addition, Consultant
agrees that during such non-competition period he will not
solicit, either directly or indirectly, any employee or customer
of the Company who was such at the time of Consultant's
employment hereunder. If the provisions of this Article Seven
should ever be adjudicated to exceed the time, geographic or
other limitations permitted by applicable law in any
jurisdiction, then such provisions shall be deemed reformed in
such jurisdiction to the maximum time, geographic or other
limitations permitted by applicable law.
ARTICLE EIGHT
INJUNCTIVE RELIEF
The parties acknowledge that disclosure or unauthorized use
of any Confidential Information by each other may give rise to
irreparable injury to each party, its subsidiaries and/or
affiliated companies. Accordingly, the parties or such other
party may seek and obtain injunctive relief against the breach or
threatened breach of the foregoing undertakings, in addition to
any other legal remedies which may be available.
ARTICLE NINE
NOTICES
All notices, demands or other written communications
hereunder shall be in writing, and unless otherwise provided,
shall be deemed to have been duly given on the first business day
after mailing by United States registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
TO CONSULTANT: Xxxxxx X. Xxxxxxx
000 Xxx Xxxx Xxx
Xxxx, Xxxxxxxxxx 00000
TO THE COMPANY: Third-Order Nanotechnologies, Inc.
0000 Xxxxxx Xx., #00
Xxxxxxxxxx, Xxxxxxxx 00000
in each case, with copies to such other addresses or to such
other persons as any Party shall designate to the others for such
purposes in manner hereinabove set forth.
ARTICLE TEN
MISCELLANEOUS
This Agreement shall be binding upon and shall inure to the
benefit of the Company's successors, transferees, and assigns.
Any amendment to this Agreement must be in writing signed by
Consultant and the Company. The Company and Consultant
acknowledge that any amendment of this Agreement (including,
without limitation, any extension of this Agreement or any change
from the terms of Article 2 in the consideration to be provided
to Consultant with respect to services to be provided hereunder)
or any departure from the terms or conditions hereof with respect
to Consultant's consulting services for the Company is subject to
the Company's and Consultant's prior written approval. This
Agreement supersedes any prior consulting or other similar
agreements between Consultant and the Company with respect to the
subject matter hereof. There is no other agreement governing or
affecting the subject matter hereof. All notices hereunder shall
be deemed to have been given, if made in writing, when mailed,
postage prepaid, to the parties at the addresses set forth above,
or to such other addresses as a party shall specify to the other.
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. Nothing in this Agreement
shall be construed or shall constitute a partnership, joint
venture, employer-employee relationship or lessor-lessee
relationship but, rather, the relationship established pursuant
hereto is that of principal and independent contractor.
IN WITNESS WHEREOF, the Parties have executed this Agreement
on the date first written above.
Third-Order Nanotechnologies, Inc.:
/s/Xxxxxxx Xxxxxxxxxx By:/s/Xxxxxxxxx Xxxxx
--------------------- ------------------------
(Witness signature) Xxxxxxxxx Xxxxx, Xx.,
President
/s/Xxxxxxx Xxxxxxxxxx /s/XX Xxxxxxx
--------------------- ------------------------
(Witness signature) Xxxxxx X. Xxxxxxx,
an individual
EXHIBIT A
---------
Warrant Agreement
WARRANT PURCHASE AGREEMENT
April 17, 2007
Xxxxxx X. Xxxxxxx
000 Xxx Xxxx Xxx
Xxxx, Xxxxxxxxxx 00000
Third-Order Nanotechnologies, Inc., a Nevada corporation
(the "Company"), hereby agrees with you as follows:
1. Concurrently with the execution of this Warrant Purchase
Agreement (the "Agreement"), the Company is entering
into with you a consulting agreement, of even date
hereof. Pursuant to the terms of the consulting
agreement, the Company will deliver to you a Warrant
(the "Warrant") in the form of Exhibit A hereto, to
---------
purchase up to Three Hundred Thousand (300,000) shares
of the Company's common stock, par value $.001 per share
(the "Common Stock"), at a purchase price of Twenty-Five
Cents ($0.25) per share, exercisable for a period of up
to Thirty-Six (36) months commencing on the date hereof
and pursuant to the following vesting schedule: (i)
Twenty-Five Thousand (25,000) shares shall vest
immediately; and (ii) Two Hundred Seventy-Five Thousand
(275,000) shares shall vest in Eleven (11) equal monthly
installments of Twenty-Five Thousand (25,000) shares per
month commencing on the 15th day of each month following
the month of execution of this Agreement.
2. The Company covenants that all shares that may be issued
upon the exercise of the Warrant will, upon issuance, be
validly issued, fully paid and nonassessable and free
from all taxes, liens and charges with respect to the
issuance thereof. The Company further covenants that
during the period within which the Warrant may be
exercised, the Company will at all times have authorized
and reserved a sufficient number of shares of Common
Stock to permit the exercise of the Warrant.
3. The provision of this Section 3 shall be binding upon
any transferee of the Warrant and upon each holder of
shares of Common Stock or other Company securities
issued upon exercise of the Warrant (the "Shares")
until such Shares shall have been sold to the public
pursuant to either an effective registration statement
under the Securities Act of 1933, as amended (the
"Securities Act") or an exemption from registration
established to the satisfaction of the Company. You
and each transferee will cause any proposed transferee
of the Shares to agree to take and hold the Shares
subject to the provisions of this Section 3. As used
in this Section 3, the term "Shares" includes any
shares of the Company's Common Stock or other
securities issued in respect of the Shares pursuant to
any stock split, stock dividend, recapitalization or
otherwise; and the term "Warrant" includes any warrant
or warrants issued in exchange for the original
Warrant. Prior to any proposed transfer of the Warrant
or of the Shares, the holder thereof shall give written
notice to the Company stating such holder's intention
to effect such transfer and describing the
circumstances of the proposed transfer in sufficient
detail, accompanied by either (i) an opinion of counsel
reasonably satisfactory to the Company to the effect
that the proposed transfer may be effected without
registration under the Securities Act, or (ii) a "no
action" letter from the staff of the Securities and
Exchange Commission to the effect that the staff will
not recommend that enforcement action be taken if the
proposed transfer is effected without registration.
Subject to evidence of compliance with any applicable
state securities or "blue sky" law or laws, the Company
shall promptly notify the holder in writing that such
holder may proceed with its transfer as described, and,
if the transfer is of Shares, shall instruct its
transfer agent to remove any stop-transfer restrictions
against the Shares when transferred as proposed.
If the foregoing correctly sets forth our understanding,
please sign below.
Very truly yours,
Accepted as of the
Third-Order Nanotechnologies, Inc. date written above:
By:/s/ Xxxxxxxxx Xxxxx /s/XX Xxxxxxx
------------------------------- --------------------
Xxxxxxxxx Xxxxx, Xx., president Xxxxxx X. Xxxxxxx
EXHIBIT A
---------
WARRANT No. ___
NO SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THIS WARRANT OR
THE SHARES PURCHASABLE HEREUNDER SHALL BE MADE EXCEPT PURSUANT TO
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
PURSUANT TO AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT
REGISTRATION IS NOT REQUIRED. TRANSFER OF THIS WARRANT IS ALSO
RESTRICTED BY A WARRANT PURCHASE AGREEMENT DATED APRIL 17, 2007,
A COPY OF WHICH IS AVAILABLE FROM THE ISSUER.
WARRANT TO PURCHASE COMMON STOCK
IN THIRD-ORDER NANOTECHNOLOGIES, INC.
Exercisable Commencing
April 17, 2007
Void After
April 17, 2010
THIS CERTIFIES that, for value received, Xxxxxx X. Xxxxxxx, 000
Xxx Xxxx Xxx, Xxxx, Xxxxxxxxxx 00000, is entitled, subject to the
terms and conditions set forth in this Warrant, to purchase from
Third-Order Nanotechnologies, Inc., a Nevada corporation (the
"Company"), located at 0000 Xxxxxx Xx., #00, Xxxxxxxxxx, Xxxxxxxx
00000, Three Hundred Thousand (300,000) shares of the Company's
common stock, par value $.001 per share (the "Common Stock"), at
a purchase price of Twenty-Five Cents ($0.25) per share,
exercisable for a period of up to Thirty-Six (36) months
commencing on the date hereof, subject to adjustment as provided
in Section 5 below. This Warrant is issued pursuant to a Warrant
Purchase Agreement between Xxxxxx X. Xxxxxxx and the Company,
dated April 17, 2007, and is subject to all the terms thereof,
including the vesting schedules set forth in Section 1 thereof,
and the limitations on transferability set forth in Section 3
thereof.
1. This Warrant may be exercised by the holder hereof, in
whole or in part (but not as to a fractional share), by the
presentation and surrender of this Warrant with the form of
Election to Purchase duly executed, at the principal office of
the Company (or at such other address as the Company may
designate by notice in writing to the holder hereof at the
address of such holder appearing on the books of the Company),
and upon payment to the Company of the purchase price by
certified or bank cashier's check. The shares of Common Stock
so purchased shall be deemed to be issued to the holder hereof as
the record owner of such shares of Common Stock as of the close
of business on the date on which this Warrant shall have been
surrendered and payment made for such shares. Certificates for
the shares of Common Stock so purchased shall be delivered or
mailed to the holder promptly after this Warrant has been
exercised, and if applicable, a new Warrant identical in form
representing the number of shares of Common Stock with respect to
which this Warrant shall not then have been exercised shall also
be issued to the holder hereof.
2. Nothing contained herein shall be construed to confer
upon the holder of this Warrant, as such, any of the rights of a
shareholder of the Company.
3. The Company shall not issue certificates representing
fractions of shares of Common Stock upon the exercise of this
Warrant, but shall make a cash payment for any fractional share
based on the market price of the Common Stock on the date of
exercise, which shall be the closing sale price on the principal
exchange on which the Common Stock is traded; or if not traded on
any exchange, then the representative closing bid price in the
over-the-counter market; or if not traded in the over-the-counter
market, the fair market value as determined by the Company's
board of directors. All calculations under this Section 3 and
under Section 5 shall be made to the nearest cent or shares, as
the case may be.
4. Subject to the limitations on transfer set forth in
Section 3 of the Warrant Purchase Agreement, this Warrant is
exchangeable, upon its surrender by the holder at the office of
the Company referred to in Section 1 above, for new warrants
(containing the same terms as this Warrant) each representing the
right to purchase such number of shares of Common Stock as shall
be designated by such holder at the time of such surrender (but
not exceeding in the aggregate the remaining number of shares of
Common Stock which may be purchased hereunder). Upon receipt of
evidence satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and upon delivery of a
bond of indemnity satisfactory to the Company (or, in the case of
mutilation, upon surrender of this Warrant), the Company will
issue to the holder a replacement warrant (containing the same
terms as this Warrant). As used herein, "Warrant" shall include
all new warrants issued in exchange for or replacement of this
Warrant.
5. If the Company shall pay a dividend in shares of its
Common Shares, subdivide (forward-split) its outstanding shares
of Common Stock, combine (reverse-split) its outstanding shares
of Common Stock, issue by reclassification of its shares of
Common Stock any shares or other securities of the Company, or
distribute to holders of its Common Stock any securities of the
Company or of another entity, the number of shares of Common
Stock or other securities the holder hereof is entitled to
purchase pursuant to this Warrant immediately prior thereto shall
be adjusted so that the holder shall be entitled to receive upon
exercise the number of shares of Common Stock or other securities
which he or she would have owned or would have been entitled to
receive after the happening of any of the events described above
had this Warrant been exercised immediately prior to the
happening of such event, and the exercise price per share shall
be correspondingly adjusted; provided, however, that no
adjustment in the number of shares and/or the exercise price
shall be required unless such adjustment would require an
increase or decrease of at least one percent (1%) in such number
and/or price; and provided further, however, that any adjustments
which by reason of this Section 5 are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. An adjustment made pursuant to this Section 5 shall
become effective immediately after the record date in the case of
the stock dividend or other distribution and shall become
effective immediately after the effective date in the case of a
subdivision, combination or reclassification. The holder of this
Warrant shall be entitled to participate in any subscription or
other rights offering made to holders of Common Stock had he
purchased the full number of shares as to which this Warrant
remains unexercised immediately prior to the record date for such
rights offering. If the Company is consolidated or merged with
or into another corporation or if all or substantially all of its
assets are conveyed to another corporation this Warrant shall
thereafter be exercisable for the purchase of the kind and number
of shares of stock or other securities or property, if any,
receivable upon such consolidation, merger or conveyance by a
holder of the number of shares of Common Stock of the Company
which could have been purchased on the exercise of this Warrant
immediately prior to such consolidation, merger or conveyance;
and, in any such case, appropriate adjustment (as determined by
the Board of Directors) shall be made in the application of the
provisions herein set forth with respect to the rights and
interests thereafter of the holder of this Warrant to the end
that the provisions set forth herein (including provisions with
respect to changes in and other adjustments of the number of
shares of Common Stock the holder of this Warrant is entitled to
purchase) shall thereafter be applicable, as nearly as possible,
in relation to any shares of Common Stock or other securities or
other property thereafter deliverable upon the exercise of this
Warrant. Upon any adjustment of the number of shares of Common
Stock or other securities the holder of this Warrant is entitled
to purchase, and of any change in exercise price per share, then
in each such case the Company shall give written notice thereof
to the then registered holder of this Warrant at the address of
such holder as shown on the books of the Company, which notice
shall state such change and set forth in reasonable detail the
method of calculation and the facts upon which such calculation
is based.
6. If at any time:
A. The Company shall declare a dividend or other distribution
on its Common Stock payable otherwise than in cash at the
same rate as the immediately preceding regular dividend or
in Common Stock;
B. The Company shall authorize the granting to the holders
of its Common Stock of rights to subscribe for or purchase
any shares of capital stock of any class or of any other
rights;
C. There shall be any plan or agreement of reorganization,
or reclassification of the capital stock of the Company,
or consolidation or merger of the Company with, or sale
of all or substantially all of its assets to, another
corporation; or
D. There shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company; then the Company
shall give to the registered holder of this Warrant at the
address of such holder as shown on the books of the Company,
at any time prior to the applicable record date or dates,
a written notice summarizing such action or event and
stating the record date or dates for any such dividend or
rights (or if a record is not to be taken, the date or
dates as of which the holders of Common Stock of record
to be entitled to such dividend or rights are to be
determined), the date on which any such reorganization,
reclassification, consolidation, merger, sale of assets,
dissolution, liquidation or winding up is expected to
become effective, and the date or dates as of which it
is expected the holders of Common Stock of record shall
be entitled to effect any exchange of their shares of
Common Stock for securities of other property deliverable
upon any such reorganization, reclassification,
consolidation, merger, sale of assets, dissolution,
liquidation or winding up.
IN WITNESS WHEREOF, the Company has caused this Warrant to
be signed by its duly authorized officers on April 17, 2007.
Attested: THIRD-ORDER NANOTECHNOLOGIES, INC.:
By:/s/Xxxxxx X. Xxxxxx By:/s/Xxxxxxxxx Xxxxx
--------------------------- --------------------------------
Xxxxxx X. Xxxxxx, Secretary Xxxxxxxxx Xxxxx, Xx., president
EXHIBIT B
---------
Conflict of Interest Disclosure
N/A
EXHIBIT C
---------
Prior Work Product Disclosure
1. Except as listed in Section 2 below, the following is a
complete list of all Prior Work Product that have been made or
conceived or first reduced to practice by Consultant alone or
jointly with others prior to my engagement by Third-Order
Nanotechnologies, Inc.:
[X] No inventions or improvements.
[ ] See below:
[List other work product here]
[ ] Additional sheets attached.
2. Due to a prior confidentiality agreement, Consultant cannot
complete the disclosure under Section 1 above with respect to
inventions or improvements generally listed below, the
proprietary rights and duty of confidentiality with respect to
which Consultant owes to the following party(ies):
Invention or Improvement Party(ies) Relationship:
1. ___________________________
2. ___________________________
3. ___________________________
[ ] Additional sheets attached.
(a)
(b)
(c)
(d) Background Technology Disclosure
The following is a list of all Background Technology which
Consultant intends to use in performing under this Agreement:
[List all background technology to be used under this Agreement here.]
EXHIBIT D
---------
Assignment of Copyright
For good and valuable consideration which has been received,
the undersigned sells, assigns and transfers to Third-Order
Nanotechnologies, Inc., a Nevada corporation, and its successors
and assigns, the copyright in and to the following work, which
was created by the following indicated author(s):
Title:
Author(s):
Copyright Office Identification No. (if any):
and all of the right, title and interest of the undersigned,
vested and contingent, therein and thereto.
Executed ____5/31/07___________ [date].
Signature: _____/s/ HR Bennett_____
Printed Name: __Hal Bennett_______
