010-9055-0373/5/AMERICAS

UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

PAUL NG INVESTORS, LLC,

Plaintiff, 

v.

NANO GLOBAL CORP., WCRST, LLC 

and STEVE PAPERMASTER, 

Defendants. 

Civil Action No. 1:20-CV-00488

COMPLAINT FOR BREACH OF CONTRACT

Now comes Plaintiff, Paul NG Investors, LLC (“PNGI”) and for its Complaint for Breach 

of Contract against Defendants Nano Global Corp. (“Nano”), WCRST, LLC (“WCRST”) and 

Steve Papermaster alleges as follows: 

1. This is an action for breach of: (1) an Amended and Restated Convertible

Promissory Note in the principal amount of $4,100,000 (the “Convertible Note”) between Plaintiff 

PNGI and Defendant Nano; (2) a Letter Agreement related to the Convertible Note between 

Plaintiff PNGI and Defendants WCRST and Steve Papermaster, individually; and (3) an additional 

Convertible Promissory Note in the original principal amount of $1,000,000 (the “Additional 

Note”) between Plaintiff PNGI and Defendant Nano. 

The Parties

2. Plaintiff PNGI is an Ohio Limited Liability Company with its principal place of

business in Pittsburgh, Pennsylvania. The Members of PNGI are individuals and are citizens of 

California, Florida, Ohio and Pennsylvania. 

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3. Defendant Nano is a Delaware Corporation with its principal place of business in 

Austin, Texas. Nano is a citizen of Delaware and Texas. Nano may be served with a summons at 

1705 Guadalupe Street, Fourth Floor, Austin, Texas 78701.

4. Defendant WCRST is a Texas Limited Liability Company with its principal place 

of business in Austin, Texas. The identity of the Members of WCRST is not publically available. 

After reasonable inquiry, no information indicates or suggest that WCRST or its Members are 

citizens of California, Florida, Ohio or Pennsylvania. Rather all information indicates and suggests 

that WCRST only is a citizen of Texas. After reasonable inquiry, and on information and belief, 

WCRST and its Members are citizens of Texas. WCRST may be served with a summons at 1705 

Guadalupe Street, Fourth Floor, Austin, Texas 78701. 

5. Defendant Steve Papermaster (“Mr. Papermaster”) is an individual and a citizen of 

Texas. Mr. Papermaster is the CEO of Nano and the Co-President and Manager of WCRST. Mr. 

Papermaster may be served with a summons at 1705 Guadalupe Street, Fourth Floor, Austin, Texas 

78701.

Jurisdiction and Venue

6. This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. § 

1332. There is complete diversity of citizenship and the amount in controversy exceeds $75,000.

7. This Court has personal jurisdiction over each of the Defendants. Each of the 

Defendants resides in this judicial district. The contracts at issue were executed by Defendants in 

this judicial district and involve Nano, a corporation with its principal place of business in this 

judicial district.

8. Venue is proper in this judicial district under 28 USC § 1391.

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The Parties’ Contracts

9. Defendant Nano is an early stage privately held medical technology company 

engaged in the development and marketing of nanotechnology-based products. In 2016, Nano was 

in the process of raising capital to fund the acquisition, development and marketing of a suite of 

nanotechnology-based surface sanitizing and disinfectant products for medical applications. 

10. Mr. Papermaster founded Nano and at all times has been its CEO. 

11. WCRST is an entity created and owned by Mr. Papermaster to hold interests, 

including stock, in Nano.

12. Sometime in 2016, Mr. Papermaster approached the eventual members of PNGI

about investing in Nano.

13. As a result of the communications with Mr. Papermaster, PNGI was formed in 

February 2017 for the purpose of investing in Nano. 

14. On or about March 6, 2017, PNGI entered into a number of related transactions 

with Mr. Papermaster, Nano and WCRST.

15. The March 6, 2017 transactions included a Restricted Stock Transfer Agreement 

between PNGI and WCRST with respect to shares of Series 1 Preferred Stock of Nano (the “Stock 

Transfer Agreement”). A copy of the Stock Transfer Agreement is attached hereto as Exhibit 1. 

Under the Stock Transfer Agreement, WCRST transferred 1,900,000 shares of Series 1 Preferred 

Stock in Nano to PNGI at a price of $.02 per share. 

16. In addition, on March 6, 2017, PNGI invested in a Convertible Promissory Note 

issued by Nano (the “Convertible Note”). Under the Convertible Note, Nano agreed to repay the 

principal amount of $4,100,000 plus interest at the rate of 4.25% per annum on the maturity date 

of March 6, 2019 or earlier if Nano closed a Qualified Financing, upon which PNGI could convert 

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the principal of the Note into an equity security in Nano. The Convertible Note subsequently was 

amended and restated to extend its maturity date to March 31, 2020. A copy of the operative 

Amended and Restated Convertible Note is attached as Exhibit 2.

17. Also on March 6, 2017, PNGI entered into a Letter Agreement (the “Letter 

Agreement”) with WCRST, LLC and Mr. Papermaster, individually. A copy of the Letter 

Agreement, together with the most recent amendment thereto, is attached as Exhibit 3. 

18. Under the Letter Agreement, WCRST and Mr. Papermaster agreed that if, by

December 1, 2017, the Convertible Note had not been converted into preferred stock in Nano, 

WCRST and/or Mr. Papermaster would: (1) re-purchase the shares in Nano that were the subject 

of the Stock Transfer Agreement at a price equal to PNGI’s purchase price and (2) purchase the 

Convertible Note for an amount equal to the principal amount thereof and all accrued and unpaid 

interest.

19. In 2019, Mr. Papermaster, on behalf of Nano, approached PNGI about additional 

funding, and on or about June 28, 2019, PNGI and Nano entered into an additional Convertible 

Promissory Note for $1,000,000 (the “Additional Note”) with a maturity date of August 15, 2019. 

20. The Additional Note is not subject to the Letter Agreement. 

21. The Additional Note was amended twice to change the maturity date to September 

20, 2019 and then to March 31, 2020. A copy of the Additional Note, with amendments, is attached 

as Exhibit 4. 

22. In December 2019, the parties agreed to amend the Convertible Note and the Letter 

Agreement to extend the maturity date of the Convertible Note and the corresponding date in the 

Letter Agreement to March 31, 2020.

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23. Accordingly, PNGI and Nano entered into an Amended and Restated Convertible 

Promissory Note (the “Amended Convertible Note”). Under the Amended Convertible Note, the 

maturity date was extended to March 31, 2020. 

24. In addition, PNGI and WCRST and Mr. Papermaster amended the Letter 

Agreement, with a corresponding change in the maturity date under the Letter Agreement to March 

31, 2020.

25. By the amended maturity date, March 31, 2020, Nano did not complete a Qualified 

Financing.

26. By the amended maturity date, March 31, 2020, Nano did not repay any of the 

principal or interest on the Amended Convertible Note.

27. By the amended maturity date, March 31, 2020, Nano also did not repay any of the 

principal of or interest on the Additional Note.

28. On April 1, 2020, PNGI provided notice and demand to WCRST and Mr. 

Papermaster under the amended Letter Agreement to fulfill their obligations to repurchase the 

shares in Nano and to purchase the Amended Convertible Note.

29. WCRST and Mr. Papermaster have not satisfied their obligations to PNGI under 

the Letter Agreement.

Count I – Breach of the Amended Convertible Note – Nano

30. Plaintiff restates each paragraph above as fully rewritten herein. 

31. PNGI and Nano are parties to the Amended Convertible Note.

32. As of March 31, 2020, the principal amount of $4,100,000 is due and owing from 

Nano to PNGI on the Amended Convertible Note.

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33. As of March 31, 2020, interest in the amount of $570,042.72 is due and owing from 

Nano to PNGI on the Amended Convertible Note.

34. Although due, Nano has failed to repay any part of principal of or interest on the 

Amended Convertible Note. 

35. Nano is in default of the Amended Convertible Note.

36. PNGI has satisfied any and all conditions precedent to recovery under the Amended 

Convertible Note.

Count II -- Breach of the Letter Agreement -- WCRST and Steve Papermaster

37. Plaintiff restates each paragraph above as fully rewritten herein.

38. PNGI, on the one hand, and WCRST and Mr. Papermaster on the other, are parties 

to the Letter Agreement.

39. Under the Letter Agreement, WCRST and Mr. Papermaster each, jointly and 

severally, were required within 30-days of notice from PNGI to repurchase the stock transferred 

to PNGI by WCRST under the Stock Purchase Agreement for the purchase price paid by PNGI 

therefor, and to purchase the Amended Convertible Note for an amount equal to the principal 

amount thereof and all accrued interest thereon.

40. On or about April 1, 2020, PNGI made demand on WCRST and Mr. Papermaster 

to fulfill their obligations under the Letter Agreement. 

41. PNGI has satisfied any and all conditions precedent to recovery under the Letter 

Agreement.

42. WCRST and Mr. Papermaster have failed to fulfill their obligations under the Letter 

Agreement.

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Count III – Breach of the Additional Note – Nano

43. Plaintiff restates each paragraph above as fully rewritten herein. 

44. PNGI and Nano are parties to the Additional Note.

45. As March 31, 2020, the principal amount of $1,000,000 is due and owing from 

Nano to PNGI on the Additional Note.

46. As of March 31, 2020, accrued interest in the amount of $32,720.46 is due and 

owing from Nano to PNGI on Additional Note.

47. Although due, Nano has failed to repay any part of the principal of or accrued 

interest on the Additional Note. 

48. Nano is in default of the Additional Note.

49. PNGI has satisfied any and all conditions precedent to recovery under the 

Additional Note.

Prayer for Relief

WHEREFORE, Plaintiff PNGI prays for relief as follows: 

A. On Count I, compensatory damages against Nano for Nano’s breach of the 

Amended Convertible Note in an amount of $4,670,042.72;

B. On Count II, compensatory damages, jointly and severally against WCRST and 

Steve Papermaster for breach of the Letter Agreement in the amount of $38,000, representing the 

obligations relating to the stock repurchase and $4,670,042.72 representing the purchase price of 

the Amended Convertible Note;

C. On Count III, compensatory damages against Nano for Nano’s breach of 

Additional Note in the amount of $1,032,720.46;

D. Its reasonable attorney fees and the costs of this action; 

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E. For pre-judgment and post-judgment interest on all Counts at the maximum rate

allowed by law; and

F. Such other and further relief as this Court deems just and proper

Dated: May 5, 2020

/s/ Michael S. Forshey

Michael S. Forshey 

State Bar No. 07264250 

SQUIRE PATTON BOGGS (US) LLP 2000 

McKinney Avenue, Suite 1700 Dallas, 

Texas 75201 

Tel: +214-758-1500 

Facsimile: +214-758-1550 

Michael.forshey@squirepb.com

Steven A. Friedman (pro hac vice pending) 

SQUIRE PATTON BOGGS (US) LLP 4900 

Key Tower 

127 Public Square 

Cleveland, Ohio 44114 

Tel.: +1 216-479-8500 

Facsimile: +216-479-8780 

steven.friedman@squirepb.com 

Attorneys for Plaintiff 

Paul NG Investors, LLC

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