Stock Purchase And Investor Rights Agreement (Page 3 of 9) in pdf

certain applications of the Company’s intellectual property in exchange for the

Company’s agreement to issue to the founder 200,000 shares of the Company’s

preferred stock. Said stock shall be issued without any right to receive any

dividend. The preferred shares will however have super voting rights equivalent

to 100 votes of Class A Common shares per share of preferred, such that the total

issuance of preferred shares to the founder shall have the voting power of

20,000,000 Class A shares. In the alternative, the founder can convert that

obligation, as well as other financial obligations to which the Company is

indebted to the founder, into Class A Common shares.

The Company also has an obligation to issue additional shares to its employees

and/or consultants upon the happening of certain triggering events, specifically

the successful completion of certain research benchmarks and upon the

employee’s conversion of Company indebtedness to the employee for salary to

Class A Common shares.

2.6

No Conflicts. Neither the Company, nor any subsidiary, is in violation of, in

conflict with, in breach of or in default under any term or provision of, (i) its

Certificate of Incorporation or By-laws (each as may have been amended,

supplemented or restated), (ii) any provision of any judgment, writ, injunction,

decree or order to which the any of them is a party.

Litigation.

There is no action, suit, proceeding or investigation pending or, to the best

knowledge of the Company, currently threatened against the Company or any subsidiary that

may affect the validity of this Agreement or the right of the Company to enter into this

Agreement or to consummate the transactions contemplated hereby. There is no action, suit,

proceeding or investigation pending or, to the best knowledge of the Company, currently

threatened against the Company or its subsidiaries, before any court or by or before any

governmental body or any arbitration board or tribunal, nor is there any judgment, decree,

injunction or order of any court, governmental department, commission, agency, instrumentality

or arbitrator against the Company or any of its subsidiaries. The Company and its subsidiaries

are not a party or subject to the provisions of any order, writ, injunction, judgment or decree of

any court or government agency.

Brokers’ Fees and Commissions.

2.7

Neither the Company nor any of its officers,

directors, employees, stockholders, agents or representatives, have employed any

investment banker, broker, or finder in connection with the transactions

contemplated by this Agreement and no such person or entity is entitled to a fee

with respect to the transactions contemplated by this Agreement, unless purchaser

has otherwise received a disclosure to such effect.

2.8

Applicable Laws.

The Company has complied in all respects with applicable

federal and state laws, rules and regulations applicable to it and all shares of

Stock Purchase And Investor Rights Agreement Page 3