Exhibit 10.21

API NANOTRONICS CORP.

(THE “CORPORATION”)

2006 EQUITY INCENTIVE PLAN

Notice and Agreement of Grant of Stock Option

 

TO:    MARTIN MOSKOVITS FROM:    Board of Directors of API Nanotronics Corp.
DATE:    May 30, 2008

At the direction of the Compensation Committee (the “Committee”), you are hereby
notified that on May 30, 2008 (the “Date of Grant”) the Committee has granted to
you an option (the “Option”) to purchase shares of Common Stock of API
Nanotronics Corp. (the “Corporation”), pursuant to the Corporation’s 2006 Equity
Incentive Plan (the “Plan”), as amended from time to time, which is incorporated
herein by reference and made a part of this agreement. This agreement evidences
the Option that was granted to you. Capitalized terms not otherwise defined
herein shall have the same meanings as in the Plan.

 

  1. This Option is intended to be a Nonstatutory Option.

 

  2. Subject in all respects to the Plan and the terms and conditions set forth
herein and therein, you are hereby granted an Option to purchase from the
Corporation 3,500,000 shares of Common Stock (the “Shares”) at the exercise
price of $0.1005 per share (the “Option Price”). This Option is being issued to
you by the Corporation as consideration for your services as an employee to the
Corporation. The exercise price of this option represents an amount not less
than the fair market value of the shares of common stock of the Corporation as
of the close of business on May 30, 2008.

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  3. This Option shall become exercisable by you in part on each of the vesting
dates if you are on such vesting date serving as a full-time employee or a
full-time independent contractor to the Corporation or any of its affiliates:

 

Grant Date

   Number of
Options Vested   

Vesting Dates

   Exercise Price per
Option May 30, 2008    700,000    May 30, 2008    US$ 0.1005 May 30, 2008   
700,000    May 30, 2008    US$ 0.1005 May 30, 2008    700,000    June 29, 2008
   US$ 0.1005 May 30, 2008    700,000    June 29, 2010    US$ 0.1005 May 30,
2008    700,000    Upon the receipt of the Corporation (or any of its successor
corporations or affiliates) of US$5,000,000 of commitments in total grants or
funding from bona-fide third parties related to the research and/or development
of nanotechnology or related products.    US$ 0.1005

Total:

   3,500,000      

If your service as a full-time employee or full-time consultant to the
Corporation or any of its affiliates is terminated for any reason, the Option,
to the extent not exercisable, shall be cancelled without consideration.

 

  4. Subject to the termination provisions set forth in the Plan, the Option
shall expire on June 29, 2011 (the “Expiration Date”). If your service to the
Corporation as a part-time consultant is terminated for any reason prior to the
Expiration Date, the vested portion of your Option shall remain exercisable
until terminated as set forth in the Plan and the non-vested portion of your
Option shall be cancelled as provided above.

 

  5. Subject to the termination provisions set forth in the Plan, the vested
portion of this Option shall be exercisable at any time and from time to time
from and including the Date of Grant through and including up to 5:00 p.m.
(Eastern Standard Time) on the Expiration Date by delivery to the Committee or
its designee an Exercise Notice, in the form attached as Exhibit “A” to this
Option Certificate, together with this Notice and Agreement of Stock Option and
a certified check, bank draft or money order payable to “API NANOTRONICS CORP.”
in an amount equal to the product of the Exercise Price and the number of Shares
for which this Option is being exercised and otherwise in accordance with the
Plan.

 

  6. The option is non-transferable, other than as may be occasioned by your
death, and then only to your estate or according to the terms of your will or
the provisions of applicable laws of descent and distribution.

 

  7.

In the event that the right to exercise the Option is passed to your estate, or
to a person to whom such right devolves by reason of your death, then the Option
shall be

 

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non-transferable in the hands of your executor or administrator or of such
person, except that the Option may be distributed by your executor or
administrator to the distributees of your estate as a part of your estate.
Enclosed for your careful review is a copy of the Plan governing the Option. At
the time or times when you wish to exercise the Option, in whole or in part,
please refer to the provisions of the Plan dealing with methods and formalities
of exercise of the Option. The Corporation shall have the right, and is hereby
authorized, to withhold from any payment due or transfer made under the Option,
or from any compensation owing to you, applicable withholding taxes, if any.

Neither the Plan nor this agreement will be construed as giving you the right to
be retained in the employ of the Corporation or as a consultant to the
Corporation or its affiliates, and the Corporation or its affiliates may at any
time terminate your employment or consulting engagement free from any liability
or any claim under the Plan or this agreement, except as otherwise expressly
provided herein.

 

  8. This agreement shall be governed by and construed in accordance with the
laws of Delaware, without regard to the conflicts of laws provisions thereof,
and shall be subject in all respects to the terms of the Plan. If any one or
more provisions of this agreement shall be found to be illegal or unenforceable
in any respect, the validity and enforceability of the remaining provisions
hereof shall not in any way be affected or impaired thereby. This agreement and
the Plan contain the entire agreement between the Corporation and you relating
to the Option and the other matters set forth herein. This agreement is subject
to the terms and conditions of the Plan. In the event of any inconsistent
provisions between this agreement and the Plan, the Plan shall govern. Except as
expressly provided in this agreement or the Plan with respect to certain actions
permitted to be taken by the Committee with respect to this agreement and the
terms of the Option, this agreement may not be amended, modified, changed, or
waived other than by written instrument signed by the parties hereto. This
agreement may be executed in counterparts, each of which shall be an original
with the same effect as if the signatures were upon the same instrument.

 

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  9. This Option amends and restates that certain Option dated July 2, 2007
between you and the Corporation.

 

API NANOTRONICS CORP.

By:

 

/s/ Stephen Pudles

Its:  

CEO

I hereby acknowledge receipt of a copy of the Plan, a copy of which is annexed
hereto, and represent that I am familiar with the terms and provisions thereof
and hereby accept the Option, subject to all the terms and provisions of the
plan and this agreement. I hereby agree to accept as binding, conclusive and
final all decisions or interpretations of the Committee with respect to any
questions arising under the Plan.

 

/s/ Martin Moskovits

Martin Moskovits Date:                     

 

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EXHIBIT “A”

EXERCISE NOTICE

 

TO:   API NANOTRONICS GROUP CORP. (the “Corporation”) AND TO:   THE BOARD OF
DIRECTORS THEREOF

Unless context otherwise requires, or unless expressly defined herein, all
capitalized terms will have the meanings specified in the Corporation’s 2006
Equity Incentive Plan adopted October 26, 2006.

The undersigned holder of the Options evidenced by the Notice and Agreement of
Grant of Stock Option hereby subscribes for          Shares of the Corporation
pursuant to such Options exercisable at an exercise price of US$0.1005 until the
Expiration Date (or such other price as is determined pursuant to the Notice and
Agreement of Grant of Stock Option) on the terms specified in such Notice and
Agreement of Grant of Stock Option and enclosed herewith a certified check, bank
draft or money order payable to the order of the Corporation in payment
therefore, or such other form of payment authorized by the Plan and the
Committee.

The undersigned hereby irrevocably directs that the said Shares be issued and
delivered as follows:

 

Name(s) in Full

 

Address(es)

 

Number(s) of

Common Shares

 

Taxpayer

Identification

Number (if

applicable)

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(Please print full name in which Share certificates are to be issued. If any
Shares are to be issued to a person or persons other than the holder, the holder
must pay to the Corporation all eligible transfer taxes or other government
charges.)

DATED this      day of                     ,         .

 

 

   

 

Signature Guaranteed     Signature of Subscriber    

 

    Name of Subscriber    

 

    Address of Subscriber    

 

 

¨ Please check if the Share certificates are to be delivered at the office where
this Exercise Notice is surrendered, failing which the certificates will be
mailed.

Certificates will be delivered after the due surrender of the Notice and
Agreement of Grant of Stock Option as aforesaid. In the event less than all of
the Shares represented by this Notice and Agreement of Grant of Stock Option are
exercised, a new Notice and Agreement of Grant of Stock Option for the remaining
Shares subject to this Notice and Agreement of Grant of Stock Option shall be
issued to the holder.