EXHIBIT 10.7

                         TRANSFER OF TRADEMARK AGREEMENT




<PAGE>

EXHIBIT 10.7

                         TRANSFER OF TRADEMARK AGREEMENT


     THIS  AGREEMENT  ("Agreement")  is made  effective as of May 6, 2004 by and
between  XsunX,  Inc.,  a Colorado  corporation  ("XsunX"),  and Western Gas and
Electric Company, a California  corporation  ("Western").  XsunX and Western are
sometimes  herein referred to individually as a "party" and  collectively as the
"parties."

                                 R E C I T A L S

     A.  WHEREAS,  Western  solely owns all rights and  interests  in and to the
registered  trademark consisting of printed words styled as "POWERGLASS" as more
fully set forth herein ("Trademark");

     B. WHEREAS,  Western  desires to assign and transfer,  subject to the terms
and  conditions  set forth  herein,  all rights and interest in the Trademark to
XsunX in exchange for the payment set forth in this Agreement; and

     C. WHEREAS,  XsunX desires to acquire,  subject to the terms and conditions
set forth  herein,  all rights and interest in the Trademark in exchange for the
payment set forth in this Agreement.

     NOW,  THEREFORE,  in consideration of the mutual promises contained herein,
and other good and valuable consideration,  the receipt and sufficiency of which
are hereby acknowledged, the Parties hereto agree as follows:

                                   ARTICLE 1.

                             ASSIGNMENT OF TRADEMARK

1.1. Assignment of Registered Trademark. Subject to the terms and conditions set
forth in this  Agreement,  including the payment set forth below,  Western shall
execute,  acknowledge, and deliver to XsunX: (i) The separate form of assignment
attached hereto as Exhibit "A;" (ii) all assignment  instruments required by the
United States Patent and Trademark  Office to fully  effectuate  assignment  and
transfer  of the  Trademark  to  XsunX;  and (iii)  any  other  instruments  and
documents  reasonably  required  to  accomplish  the intent and  purpose of this
Agreement.

1.2.  Re-Assignment  of  Trademark.  If  XsunX  should  default  in any  payment
obligation  hereunder  (i.e.,  fail to make payment prior to the expiration of 3
years and 6 months after the effective date of this  Agreement),  become subject
to a bankruptcy proceeding or petition which is not dismissed within 90 days, or
cease to  conduct  business  at any time  prior  to the  latest  due date of any
payment hereunder, XsunX shall execute, acknowledge, and deliver to Western: (i)
a separate form of assignment in the form of the assignment  attached  hereto as
Exhibit "A" but  configured  so as to  constitute an assignment of the Trademark
from XsunX back to  Western  (ii) all  assignment  instruments  required  by the
United States Patent and Trademark  Office to fully  effectuate  assignment  and
transfer of the  Trademark to back to Western;  and (iii) any other  instruments
and documents  reasonably  required to accomplish the intent and purpose of this
Agreement.  XsunX shall have no further  obligation or liability to Western with
regard to the  Trademark.  The  interest  of  Western  in  re-assignment  of the

                                                                               1

<PAGE>

Trademark as set forth herein shall be senior to all other interests  granted or
created  by XsunX in the  Trademark,  and XsunX  shall not  pledge or  otherwise
encumber  the  Trademark  in any  manner  which will  violate  the terms of this
Agreement or prevent the above re-assignment to Western.

                                   ARTICLE 2.

                                     PAYMENT

2.1.  Payment.  The purchase  price for the  Trademark  shall be: (i) the sum of
$10,000.00  if  paid  within  one  (1)  year  from  the  effective  date of this
Agreement;  (ii) the sum of $20,000.00 if paid after the conclusion of the first
(1st)  year but prior to the  conclusion  of the  second  (2nd)  year  after the
effective date of this Agreement;  (iii) the sum of $35,000.00 if paid after the
conclusion  of the second (2nd) year but prior to the  conclusion of third (3rd)
year after the effective date of this  Agreement;  or (iv) the sum of $50,000.00
if paid after the conclusion of the third (3rd) year but prior to the conclusion
of  three  (3)  years  and six  (6)  months  after  the  effective  date of this
Agreement. If payment is not made prior to the conclusion of three (3) years and
six (6) months after the effective date of this Agreement, XsunX shall re-assign
the Trademark back to Western as set forth herein.

                                   ARTICLE 3.

                     GENERAL REPRESENTATIONS AND WARRANTIES

3.1. Representations of Western. Western hereby represents and warrants to XsunX
as follows:

     3.1.1 Standing. Western is a corporation duly organized,  validly existing,
and in good standing under the laws of the State of  California,  with corporate
power to own property and carry on its business as it is now being  conducted in
the state of California.

     3.1.2  Authorization  of Transaction.  Western has full power and authority
(including  full  corporate  power and  authority)  to execute and deliver  this
Agreement  and to  perform  its  obligations  hereunder.  Without  limiting  the
generality  of the  foregoing,  the  board  of  directors  of  Western  has duly
authorized  the  execution,  delivery,  and  performance  of this  Agreement  by
Western.  This Agreement constitutes the valid and legally binding obligation of
Western, enforceable in accordance with its terms and conditions.

3.2.  Representations  of XsunX. XsunX hereby represents and warrants to Western
as follows:

                                                                               2

<PAGE>

     3.2.1 Standing.  XsunX is a corporation duly organized,  validly  existing,
and in good  standing  under the laws of the State of Colorado,  with  corporate
power to own property and carry on its business as it is now being  conducted in
the state of California.

     3.2.2  Authorization  of  Transaction.  XsunX has full power and  authority
(including  full  corporate  power and  authority)  to execute and deliver  this
Agreement  and to  perform  its  obligations  hereunder.  Without  limiting  the
generality of the foregoing, the board of directors of XsunX has duly authorized
the  execution,  delivery,  and  performance  of this  Agreement by XsunX.  This
Agreement  constitutes  the valid and  legally  binding  obligation  of Western,
enforceable in accordance with its terms and conditions.

                                   ARTICLE 4.

                          INTELLECTUAL PROPERTY MATTERS


4.1. Registration and Prior Assignment. Western represents and warrants that the
Trademark  is a trademark  duly  registered  with the United  States  Patent and
Trademark Office  ("USPTO") and known as "POWERGLASS"  consisting of words only,
as registered  with the USPTO on June 7, 1988 by Utility Power Group pursuant to
registration number 1490978,  serial number 73688747, and as assigned to Western
pursuant to that certain assignment filed with the USPTO as and at reel 2243 and
frame 0449 recorded on February 22, 2001.

4.2. Ownership of Trademark.  Western represents and warrants that Western,  and
Western alone, owns the Trademark free and clear of all liens, encumbrances, and
security and other interests,  and has the right to use and assign the Trademark
without the need for any other license,  sublicense,  agreement,  or permission.
Western has taken all necessary and desirable action to prosecute, maintain, and
protect the Trademark.

4.3. No  Infringement.  Western  warrants and represents that the Trademark does
not infringe or conflict with any intellectual property rights of third parties.
Western has not interfered with, infringed upon,  misappropriated,  or otherwise
come into conflict with any intellectual  property rights of third parties,  and
none of the  directors  and officers  (and  employees  with  responsibility  for
intellectual  property  matters)  of  Western  has  ever  received  any  charge,
complaint,   claim,   demand,   or  notice   alleging  any  such   interference,
infringement,  misappropriation,  or violation (including any claim that Western
must  license or  refrain  from using the  Trademark  or any other  intellectual
property rights of any third party).  To the best knowledge of Western,  and the
directors and officers  (and  employees  with  responsibility  for  intellectual
property  matters) of Western,  no third party has  interfered  with,  infringed
upon, misappropriated, or otherwise come into conflict with the Trademark or any
other  intellectual  property  rights of Western.  With regard to the Trademark,
Western represents that:

     4.3.1. To the best knowledge of Western,  Western possess all right, title,
and  interest  in and to the  item,  free and  clear of any  Security  Interest,
license, or other restriction;

     4.3.2.  To the best  knowledge of Western,  the Trademark is not subject to
any outstanding injunction, judgment, order, decree, ruling, or charge;

                                                                               4

<PAGE>

     4.3.3.  To the best  knowledge  of Western,  no action,  suit,  proceeding,
hearing,  investigation,  charge, complaint,  claim, or demand is pending or, to
the best  knowledge  of Western or any of Western's  directors or officers  (and
employees with  responsibility for intellectual  property matters) of Western is
threatened  which  challenges the legality,  validity,  enforceability,  use, or
ownership of the Trademark; and

     4.3.4.  To the best  knowledge  of  Western,  Western  has never  agreed to
indemnify  any person or entity for or against any  interference,  infringement,
misappropriation, or other conflict with respect to the Trademark.

4.4. Title Remedies. XsunX may notify Western of the assertion of any claim that
the Trademark or the use thereof infringes or violates or is alleged to infringe
upon or  violate  any  trade  secret,  trademark,  copyright,  patent,  or other
proprietary  right of any other party and Western shall  cooperate with XsunX in
the investigation and resolution of any such claim.

4.5. Delivery of Documents. Attached hereto as Exhibit "B" is a true and correct
copy of an assignment  document or other  evidence of ownership of the Trademark
by Western  showing  the  print,  font,  type,  and style of the  Trademark  (if
applicable),  and setting forth all identifying information needed to reasonably
establish  and  defend  ownership  of  the  Trademark.  Western  has  heretofore
identified and delivered to XsunX all  registrations,  assignments,  prosecution
documents,  and all other documents and instruments  pertaining to the Trademark
pertaining  to Western or in the  possession  of Western,  including any and all
licenses, agreements, or other permissions which Western may have granted to any
third party with respect to the  Trademark or any of its  intellectual  property
(together with any exceptions).

                                   ARTICLE 5.

                               GENERAL PROVISIONS

5.1.  Recitals.  The  recitals set forth above are  incorporated  herein by this
reference and made a part of this Agreement.

5.2. Advice of Counsel. Each party has been advised of and understands the terms
and conditions of this Agreement. This Agreement has been freely and voluntarily
entered into and executed by the parties,  each of the parties hereto being duly
represented by counsel or having the benefit of advice of counsel.

5.3.  Amendments.  This Agreement may be amended only by written consent of each
of the parties hereto.

                                                                               4

<PAGE>

5.4.  Further  Acts.  The parties  hereto  shall  cooperate  with each other and
execute such  additional  documents or instruments and perform such further acts
as may  be  reasonably  necessary  to  affect  the  purpose  and  intent  of the
Agreement.

5.5.   Effect  of  Headings.   The  subject   headings  of  the  paragraphs  and
subparagraphs  of this Agreement are included for purposes of convenience  only,
and  shall  not  affect  the  construction  or  interpretation  of  any  of  its
provisions.

5.6. Entire  Agreement;  Modification,  Waiver.  This Agreement  constitutes the
entire agreement between the parties  pertaining to the subject matter contained
in it and supersedes all prior and  contemporaneous  agreement,  representations
and  understandings  of the parties.  No waiver of any of the provisions of this
Agreement shall be deemed,  or shall constitute a waiver of any other provision,
whether or not similar,  nor shall any waiver constitute a continuing waiver. No
waiver  shall be binding  unless  executed  in  writing by the party  making the
waiver.

5.7. Severability.  Should any provision or portion of this Agreement be held or
otherwise  become  unenforceable  or  invalid  for  any  reason,  the  remaining
provisions  and  portions  of  this  Agreement   shall  be  unaffected  by  such
unenforceability or invalidity.

5.8. Counterparts.  This Agreement may be executed simultaneously in one or more
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall  constitute one and the same  instrument.  The exhibits  attached
hereto and  initialed  by the parties  are made a part  hereof and  incorporated
herein by this reference.

5.9. Parties in Interest. Nothing in this Agreement, whether express or implied,
is  intended  to  confer  any  rights  or  remedies  under or by  reason of this
Agreement  on any  persons  other than the  parties  to it and their  respective
successors and assigns, nor is anything in this Agreement intended to relieve or
discharge the obligation or liability of any third party to this Agreement,  nor
shall any  provision  give any third person any right of  subrogation  or action
over against any party to this Agreement.

5.10.  Assignment.  This  Agreement  shall be binding on, and shall inure to the
benefit of, the parties to it and their respective heirs, legal representatives,
successors and assigns.

5.11.  Specific  Performance.  Each party's obligations under this Agreement are
unique. If any party should default in its obligations under this Agreement, the
parties each acknowledge that it would be extremely impracticable to measure the
resulting  damages;  accordingly,  the  nondefaulting  party, in addition to any
other available rights or remedies,  may sue in equity for specific  performance
without the necessity of posting a bond or other security,  and the parties each
expressly waive the defense that a remedy in damages will be adequate.

5.12.  Recovery of Litigation  Costs.  If any legal action or any arbitration or
other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute,  breach, default or misrepresentation in connection with any
of the  provisions of this  Agreement,  the  successful  or prevailing  party or

                                                                               5

<PAGE>

parties shall be entitled to recover as an element of their damages,  reasonable
attorneys'  fees and other  costs  incurred  in that  action or  proceeding,  in
addition to any other relief to which they may be entitled.

5.13.  Survival  of  Representations  and  Obligations.   All   representations,
warranties and agreements of the parties contained in this Agreement,  or in any
instrument,  certificate,  opinion or other  writing  provided  for in it, shall
survive the assignment of the Trademark as contemplated herein.

5.14.  Gender;  Number.  Whenever the context of this  Agreement  requires,  the
masculine gender includes the feminine or neuter gender, and the singular number
includes the plural.

5.15.  Governing Law. This Agreement shall be construed in accordance  with, and
governed by, the laws of the State of California.

5.16.  Venue.  This Agreement is to be performed at Orange  County,  California.
Therefore,  venue  for  any  action  brought  regarding  the  interpretation  or
enforcement  of  this  Agreement   shall  lie   exclusively  in  Orange  County,
California.

         IN WITNESS WHEREOF, this Agreement is made effective as of the date
first set forth above.

                                 XsunX:

                                 XsunX, Inc., a Colorado corporation



                                 By: /s/ Tom Djokovich
                                     ---------------------------------
                                     Tom Djokovich, President




                                 Western:

                                 Western Gas and Electric Company, a California
                                 corporation


                                 By: ________________________________

                                     ________________________________
                                       (Print Name and Title)

                                                                               6

<PAGE>



                                   EXHIBIT "A"

                               FORM OF ASSIGNMENT













                                                                               7

<PAGE>



                       ASSIGNMENT OF REGISTERED TRADEMARK

                                  "POWERGLASS"

         For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Western Gas and Electric Company, a California
corporation ("Western"), hereby sells, assigns, and transfers to XsunX, Inc., a
Colorado corporation ("XsunX"), all right, title, and interest in and to that
certain registered trademark known as "POWERGLASS" consisting of words only, as
registered with the United States Patent and Trademark Office ("USPTO") on June
7, 1988 pursuant to registration number 1490978, serial number 73688747, and as
assigned to Western pursuant to that certain assignment filed with the USPTO as
and at reel 2243 and frame 0449 recorded on February 22, 2001 ("Trademark").

         Western, and Western alone, owns the Trademark free and clear of all
liens, encumbrances, and security and other interests, and has the right to use
and assign the Trademark without the need for any other license, sublicense,
agreement, or permission. Western has taken all necessary and desirable action
to prosecute, maintain, and protect the Trademark.

         This Assignment is made pursuant that certain Transfer of Trademark
Agreement by and between Western and XsunX. The above Transfer of Trademark
Agreement shall control over this Assignment. This Assignment shall be construed
in accordance with, and governed by, the laws of the State of California. This
Assignment is to be performed at Orange County, California. Therefore, venue for
any action brought regarding the interpretation or enforcement of this
Assignment shall lie exclusively in Orange County, California.

         Date:   May __, 2004        Assingor:

                                           Western Gas and Electric Company,
                                           a California corporation


                                           By: ______________________________

                                               ______________________________
                                                 (Print Name and Title)



         Accepted by:                      Assingee:

                                           XsunX, Inc., a Colorado corporation



                                           By: /s/ Tom Djokovich
                                               ------------------------------
                                                  Tom Djokovich, President




                                                                               8

<PAGE>



                                   EXHIBIT "B"

                       EVIDENCE OF OWNERSHIP OF TRADEMARK





















                                                                               9