altair_ex1001.htm


    Exhibit
      10.1

     

    Certain
      portions of this exhibit have been omitted pursuant to Rule 24b-2 and are
      subject to a confidential treatment request. Copies of this exhibit containing
      the omitted information have been filed separately with the Securities and
      Exchange Commission. The omitted portions of this document are marked with
      a
      ***.

    


    Warrant
      Issuance Agreement

    


    This
      Warrant Issuance Agreement (this
“Agreement”) dated as of July 20, 2007 is among AES Energy Storage, LLC,
      (“AES”), Altairnano, Inc., a Nevada corporation (“Altairnano”) and Altair
      Nanotechnologies Inc., a Canadian corporation (“Parent”).  AES, Parent
      and Altairnano shall be collectively referred to herein as the “Parties” and
      each such entity a “Party.”

    


    RECITALS

    


    WHEREAS,
      AES and Altairnano have entered into a Joint Product Development and Equipment
      Purchase Agreement dated as of July 20, 2007 (the “Joint Development Agreement”)
      with respect to the design, development and manufacture of Energy Storage
      Systems;

    


    WHEREAS,
      Altairnano is a second-tier wholly-owned subsidiary of Parent, and Parent
      believes that it will benefit if the project contemplated by the Joint
      Development Agreement is successful; and

    


    WHEREAS,
      Parent
      desires to provide AES with an incentive to complete the project contemplated
      by
      the Joint Development Agreement and purchase Energy Storage Systems from
      Altairnano;

    


    AGREEMENT

    


               NOW,
      THEREFORE, in consideration of the premises and covenants and
      agreements set forth herein and in the Joint Development Agreement and for
      other
      good and valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the Parties hereto agree as follows:


     

    ARTICLE
      I

    WARRANTS

    


    1.1 
               Definitions.  Capitalized
      terms used but not defined herein will have the meaning set forth in the Joint
      Development Agreement

    


    1.2           Initial
      Warrant.  On the date of this Agreement, Parent shall issue and
      deliver to AES a warrant (the “Initial Warrant”) in substantially the form
      attached as Exhibit A (the “Form of Warrant”) to purchase common shares of
      Parent (“Common Shares”); provided that the following all-capitalized terms set
      forth in the Form of Warrant shall be completed with the following
      terms:

    


    (a)
      ISSUE
      DATE:  the date hereof;

    (b)
      NUMBER OF SHARES:  200,000;

    (c)
      VESTING DATE:  the earlier of the date of delivery of the Pilot
      Project Storage System by Altairnano pursuant to the Joint Development Agreement
      and December 31, 2007; and

    (d)
      EXERCISE PRICE:  the Execution Date Closing Price (as defined
      below).

    


    
      
         

      

      
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    For
      purposes of this Agreement, the “Execution Date Closing Price” shall be the
      closing price of the Common Shares on the principal U.S. market on which such
      shares are traded or quoted on the trading day prior to the date
      hereof.

    


    1.3           Milestone
      Warrants.  On or before March 31 of each calendar year during the
      term of the Joint Development Agreement, and so long as the Joint Development
      Agreement has not been terminated (but AES shall be entitled to receive what
      it
      has earned under this Agreement up until any such termination of the Joint
      Development Agreement), Parent shall issue and deliver to AES a warrant (each
      a
“Milestone Warrant”) in substantially the form of the Form of Warrant to
      purchase Common Shares; provided that the following all-capitalized placeholders
      in the Form of Warrant shall be filled in with the following terms:

    


    (a)
      ISSUE
      DATE:  March 31st of each
      year;

    (b)
      NUMBER OF SHARES:  a number equal to the quotient of (i) revenues
      earned during the preceding calendar year from sales of Product to AES and
      its
      Affiliates, (ii) divided by *** (such amount, the "Warrants Earned"); provided,
      however, notwithstanding the foregoing, Parent shall not be required to issue
      Milestone Warrants with respect to any calendar year (1) in excess of the (Y)
      lesser of Milestone Warrants to Purchase 500,000 Common Shares, and Milestone
      Warrants with respect to which Parent’s associated expense, determined in
      accordance with United States generally accepted accounting principles
      consistent with past practice, exceeds 10% of revenues earned during the
      preceding calendar year from sales of Product to AES and its Affiliates, or
      (2)
      in an amount less than 20,000; provided, further, that any Milestone Warrants
      which were not issued as to any calendar year as a result of the maximum and
      minimum amounts set forth in the foregoing proviso shall be added to the
      Warrants Earned in the subsequent calendar year provided Warrants Earned equal
      or exceed 20,000 in such subsequent year or any subsequent
      contract  year thereafter until issued by Parent;

    (c)
      VESTING DATE:  date the Milestone Warrant is issued; and

    (d)
      EXERCISE PRICE:  the greater of (i) the Execution Date Closing Price,
      and (ii) the difference determined by subtracting $5.00 from the Closing Price
      on January 31 (or if such day is not a Business Day, the immediately preceding
      Business Day) following the applicable calendar year.

     


    Notwithstanding
      anything to the contrary in this Agreement, Parent shall have no obligation
      to
      issue any additional Milestone Warrants if the aggregate number of the Initial
      Warrants and Milestone Warrants issued pursuant to this Agreement equals
      2,000,000 (the “Warrant Cap”).  In no event shall Milestone Warrants
      be issued under this Agreement once warrants equaling the Warrant Cap have
      been
      issued.

    


    1.4           Equitable
      Adjustments.

    


    (a)           With
      respect to each Milestone Warrant, if any of the events set forth in subsections
      (a), (b), (c) and (d) below occur on or before the date of issuance of the
      respective Milestone Warrant, the numbers set forth in Section 1.3 used to
      determine the Number of Shares and the Exercise Price for a Milestone Warrant
      (and the Warrant Cap) shall be subject to adjustment as follows: In case Parent
      shall (a) declare a dividend or make a distribution on its outstanding Common
      Shares in Common Shares or any other security, (b) subdivide or reclassify
      its
      outstanding Common Shares into a greater number of shares, (c) combine or
      reclassify its outstanding Common Shares into a smaller number of shares, or
      (d)
      enter into any transaction whereby the outstanding Common Shares are at any
      time
      changed into or exchanged for a different number or kind of shares or other
      securities of Parent or of another corporation through reorganization, merger,
      consolidation, liquidation or recapitalization, then proportionate adjustments
      in the numbers set forth in Section 1.3 used to determine the Number of Shares
      and the Exercise Price for a Milestone Warrant (and the Warrant Cap) shall
      be
      made so the Milestone Warrant will relate to the aggregate number and kind
      of
      shares or other securities (subject to the appropriately adjusted Warrant Cap),
      and will have the Exercise Price it would have related to or had if it had
      been
      issued immediately prior to the date of such event.

    


    
      
         

      

      
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    (b)           If,
      as a result of an adjustment made pursuant to the provisions of this Section
      1.4, AES shall become entitled to receive any shares of Parent other than Common
      Shares, the number of such other shares so receivable upon exercise of the
      Milestone Warrant shall be subject to adjustment from time to time in a manner
      and on terms as nearly equivalent as practicable to the provisions with respect
      to the Common Shares contained in Section 1.4(a) above.


    


    ARTICLE
      II

    REGISTRATION
      RIGHTS

    


    2.1.           Registration
      Rights.  Parent covenants and agrees that: (subject to the
      provisions of this Section 2.1), within 30 days from receipt of a written
      request from AES, it will prepare and file with the United States Securities
      and
      Exchange Commission (the “Commission”) a registration statement on Form S-3 (or
      if such form is not available, a Form S-1) (a “Registration Statement”) covering
      all of the Common Shares (or, if applicable, other shares of the Parent)
      issuable upon the exercise of any Initial Warrant or Milestone Warrant
      outstanding at the time (the “Registrable Securities”) for a secondary or resale
      offering to be made on a continuous basis pursuant to Rule
      415.  Parent will use its commercially reasonable efforts to cause
      each Registration Statement to be declared effective under the Securities Act
      of
      1933 (the “Securities Act”) Act within 120 days of the purchase of the relevant
      shares of Parent and to keep the Registration Statement continuously effective
      until the earlier of (a) such time that all of the Registrable Securities have
      been sold or (b) the date when the Registrable Securities are eligible for
      resale pursuant to paragraph (k) of Rule 144 promulgated under the Securities
      Act.  In addition, Parent shall timely supplement and amend each
      Registration Statement if required by the rules, regulations or instructions
      applicable to the registration form used for each Registration Statement or
      if
      required by the Securities Act.  If (a) at any time when a prospectus
      relating to Registrable Securities is required to be made available under the
      Securities Act, Parent discovers that, or any event occurs as a result of which,
      the prospectus (including any supplement thereto) included in the Registration
      Statement, as then in effect, includes an untrue statement of a material fact
      or
      omits to state any material fact required to be stated therein or necessary
      to
      make the statements therein, in the light of the circumstances under which
      they
      were made, not misleading, or (b) the Commission issues any stop order
      suspending the effectiveness of the Registration Statement or proceedings are
      initiated or threatened for that purpose, then Parent shall promptly deliver
      a
      written notice to such effect to AES, and AES shall immediately upon receipt
      of
      such notice discontinue its disposition of Registrable Securities pursuant
      to
      the Registration Statement until the copies of the supplemented or amended
      prospectus contemplated by the immediately following sentence is made available
      and, if so directed by Parent, shall deliver to Parent (at Parent's expense),
      if
      applicable, all copies, other than permanent file copies, then in AES's
      possession of the prospectus or prospectus supplement relating to such
      Registrable Securities current at the time of receipt of such notice. As
      promptly as practicable following the event or discovery referred to in clause
      (a) of the immediately preceding sentence, Parent shall prepare and make
      available to AES the amendment or supplement of such prospectus so that, as
      thereafter made available to purchasers of such Registrable Securities, such
      prospectus shall not include an untrue statement of a material fact or omit
      to
      state a material fact required to be stated therein or necessary to make the
      statements therein, in the light of the circumstances under which they were
      made, not misleading.  Notwithstanding anything to the contrary in
      this Section 2.1 if the filing or maintenance of the Registration Statement
      would require Parent to make a disclosure that would, in the good faith,
      reasonable judgment of Parent's Board of Directors, have a material adverse
      effect on the business, operations, properties, prospects or financial condition
      of Parent or on pending or imminent transactions, Parent shall have the right,
      upon delivery to AES of a certificate executed by Parent's chief executive
      officer certifying the Board of Directors' finding (a "Blackout Notice") to
      delay the filing (but not the preparation) of the Registration Statement or
      of
      any amendment or supplement thereto, to suspend its obligation to maintain
      the
      effectiveness of the Registration Statement and to suspend the use of any
      prospectus or prospectus supplement in connection with the Registration
      Statement, in each case for a reasonable amount of time not to exceed thirty
      (30) days (the "Blackout Period") within the ninety (90) day period beginning
      on
      the first day of a Blackout Period; provided, however, that Parent shall not
      deliver a Blackout Notice more than twice in any 365-day period; and provided,
      further that any Blackout Period shall only be effective when and for so long
      as
      other holders, if any, of registration rights with respect to Parent's
      securities are restricted from exercising their registration rights to the
      same
      or greater extent as AES.  AES agrees that upon receipt of a Blackout
      Notice, it shall immediately cease all efforts to dispose of Registrable
      Securities pursuant to the Registration Statement until such time as Parent
      shall notify it of the end of such restrictions or, if earlier, the expiration
      of the Blackout Period.

    


    
      
         

      

      
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    2.2           Parent’s
      obligations under Article II are conditioned upon AES providing any information
      regarding AES reasonably requested by Parent in order for Parent to complete
      the
      Registration Statement.

    


    2.3           With
      respect to any offering and sale pursuant to the Registration Statement, Parent
      agrees to indemnify and hold AES, each Person who "controls" AES within the
      meaning of Section 15 of the Securities Act, and any directors and officers
      of
      the foregoing, harmless against any and all losses, claims, damages or
      liabilities (including reasonable legal fees and other reasonable expenses
      incurred in the investigation and defense thereof) to which they or any of
      them
      may become subject under the Securities Act or otherwise (collectively,
      "Losses"), insofar as any such Losses shall arise out of or shall be based
      upon
      (i) any untrue statement or alleged untrue statement of a material fact
      contained in the Registration Statement, or any amendment or supplement thereto,
      or any prospectus relating to the Registration Statement, or the omission or
      alleged omission to state in any of the foregoing a material fact required
      to be
      stated therein or necessary to make the statements contained therein not
      misleading, or (ii) any violation or alleged violation by Parent of the
      Securities Act, the Exchange Act, any applicable state securities law or any
      rule or regulation promulgated under the Securities Act, the Exchange Act or
      any
      applicable state securities law; provided, however, that the indemnification
      contained in this Section 2.3 shall not apply to such Losses which shall arise
      out of or shall be based upon any such untrue statement, or any such omission
      or
      alleged omission, which shall have been made in reliance upon and in conformity
      with information furnished in writing to Parent by AES specifically for use
      in
      connection with the preparation of the Registration Statement or prospectus
      contained in the Registration Statement or any such amendment or supplement
      thereto.

    


    2.4           With
      a view to making available to AES the benefits of Rule 144 and any other rule
      or
      regulation of the Commission that may permit AES to sell securities of Parent
      to
      the public without registration, Parent agrees to use its reasonable best
      efforts until such time as all of the Registrable Securities have been sold
      under the Registration Statement or are eligible for re-sale under subsection
      (k) of Rule 144, to (a) make and keep public information available, as those
      terms are understood and defined in Rule 144, at all times, and take all action
      as may be required as a condition to the availability of Rule 144, (b) file
      with
      the Commission in a timely manner all reports and other documents required
      of
      Parent under the Securities Act and the Exchange Act, and (c) facilitate and
      expedite transfers of Registrable Shares sold pursuant to Rule 144, including
      providing timely notice to Parent's transfer agent to expedite such
      transfer.

    


    
      
         

      

      
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    2.5           Parent
      shall not be obligated to effect, or to take any action to effect, any
      registration this Section 2 after Parent has effected two registrations
      pursuant to this Section 2 and such registrations have been declared or
      ordered effective (except that a registration shall be deemed to have been
      “declared or ordered effective” if Parent withdraws a Registration Statement at
      the request of AES after it has been filed). 

    


    2.6           Parent
      shall not grant, and represents that it has not granted, any other person or
      entity rights to register securities of Parent on terms that would be reasonably

      likely to restrict the ability of Parent to fully perform its obligations to
      AES
      under this Section 2.  Parent shall not amend any registration rights
      agreement with any other person or entity nor shall Parent waive any provision
      under any registration rights agreement that it would be entitled to waive
      thereunder if such waiver would be reasonably likely to adversely affect the
      registration rights contemplated by this Article II.

    


    ARTICLE
      III

    INVESTOR
      REPRESENTATIONS

    


    3.1           Investment
      Purposes.  AES is acquiring the Initial Warrants and Milestone
      Warrants identified above and the Common Shares issuable upon the exercise
      thereof (the “Securities”) for its own account for investment and not with a
      view to, or for sale in connection with, any public distribution thereof within
      the meaning of the Securities Act of 1933, as amended (the “Securities
      Act”).

    


    3.2           Sophistication.  AES
      is an “accredited investor” as defined in Rule 501(a) promulgated under the
      Securities Act.  AES has such knowledge and experience in financial
      and business matters as to be capable of evaluating the merits and risks of
      an
      investment in the Securities and making an informed investment
      decision.

    


    3.3           Restrictions
      on Transfer. AES understands that the Securities will not be registered
      under the Securities Act, or any state securities laws, and will be issued
      in
      reliance upon exemptions from registration for certain private
      offerings.  AES understands and agrees that the Securities, or any
      interest therein, may not be resold or otherwise disposed of by AES unless
      the
      resale of the Securities is subsequently registered under the Securities Act
      and
      under all applicable state securities laws or unless the Parent receives an
      opinion of counsel, satisfactory to it, that an exemption from registration
      is
      available.

    


    3.4           Access
      to Information. AES acknowledges and represents that it has reviewed a copy
      of the most recent Annual Report on Form 10-K and Quarterly Report on Form
      10-Q
      (and all subsequently filed Current Reports on Form 8-K) of Parent, has been
      given a reasonable opportunity to review all documents, books, and records
      of
      Parent pertaining to this investment, has been supplied with all additional
      information concerning Parent and the Securities that has been requested by
      it,
      has had a reasonable opportunity to ask questions of and receive answers from
      Parent or its representatives concerning this investment, and that all such
      questions have been answered to the full satisfaction of AES.  Except
      for the representations and warranties set forth in the Joint Development
      Agreement, AES has received no representations, written or oral, from Parent,
      a
      placement agent or any officer, director, employee, attorney or agent thereof,
      other than those contained in the Form 10-K, Form 10-Q and Forms 8-K referenced
      above and has relied solely on the same in making its decision to purchase
      the
      Securities.

    


    
      
         

      

      
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    3.5           Restrictive
      Legends. AES understands and agrees that the following restrictions and
      limitations are applicable to its resales, pledges, hypothecations, or other
      transfers of the Securities: (a) the Securities shall not be sold, pledged,
      hypothecated, or otherwise transferred unless registered under the Securities
      Act and applicable state securities laws or an exemption from registration
      is
      available; and (b) each certificate or other document evidencing or representing
      the Securities shall be stamped or otherwise imprinted with a legend in
      substantially the following form:

    


    "THE
      SECURITIES OF THE COMPANY EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
      WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
      ANY
      STATE IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE
      SECURITIES ACT OF 1933, AS AMENDED, AND VARIOUS APPLICABLE STATE SECURITIES
      LAWS.  SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR
      ASSIGNED OR A SECURITY INTEREST CREATED THEREIN, UNLESS THE PURCHASER,
      TRANSFEREE, ASSIGNEE, PLEDGEE OR HOLDER OF SUCH SECURITY INTEREST COMPLIES
      WITH
      ALL STATE AND FEDERAL SECURITIES LAWS (I.E., SUCH SECURITIES ARE REGISTERED
      UNDER SUCH LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE THEREUNDER)
      AND
      UNLESS THE SELLER, TRANSFEROR, ASSIGNOR, PLEDGOR OR GRANTOR OF SUCH SECURITY
      INTEREST PROVIDES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY
      THAT THE TRANSACTION CONTEMPLATED WOULD NOT BE IN VIOLATION OF THE SECURITIES
      ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS."

    


    "UNLESS
      PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT
      TRADE THE SECURITY BEFORE [insert date that is four (4) months and one day
      after
      issue date]"

    


    3.6           Canadian
      Representations.  The offer and sale of the Securities to AES was
      not made in Canada.  AES is not subject to the securities laws of any
      province or territory of Canada, and AES is not purchasing, and will not
      purchase, any of the Securities for the account or benefit of any resident
      of
      any province or territory of Canada.


    


    ARTICLE
      IV

    TERM
      AND TERMINATION

    


     The
      term of this Agreement shall
      commence as of the date hereof and shall terminate upon the occurrence of the
      last Expiration Date of the Initial Warrants and all Milestone Warrants issued
      in accordance herewith.

     

    


    
      
         

      

      
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    ARTICLE
      V

    MISCELLANEOUS


    


               5.1           Notices.  All
      notices or other communications which are required or permitted hereunder shall
      be in writing and shall be deemed sufficiently given if delivered personally
      (as
      confirmed by signature of receiving party) or sent by nationally recognized
      overnight courier postage prepaid (as confirmed by signature of receiving party)
      to the address set forth below or to such other address as any Party may have
      specified in a notice duly given to the other Party as provided herein. Such
      notice of communication shall be deemed to have been given as of the date
      received.

     

    If
      to
      Altairnano:

    


    Altairnano,
      Inc.

    204
      Edison Way

    Reno,
      Nevada  89502

    Attn:  Alan
      Gotcher, CEO and President

    


    If
      to
      AES:

    


    AES
      Energy Storage, LLC

    c/o
      The
      AES Corporation

    4300
      Wilson Boulevard

    Arlington,
      Virginia 22203

    Attention:
      Chris Shelton

    


    With
      a
      copy to:

    


    AES
      Energy Storage, LLC

    c/o
      The
      AES Corporation

    4300
      Wilson Boulevard

    Arlington,
      Virginia 22203

    Attention:
      General Counsel

     

    
      
         

      

      
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    5.2           Amendment;
      Interpretation.  No change or modification of this Agreement shall
      be valid unless the same shall be in writing and signed by all of the
      Parties.  All headings and subheadings are inserted for convenience
      only and shall not affect any construction or interpretation of this
      Agreement.

     

    5.3           Waiver.  No
      failure or delay on the part of the Parties in exercising any right, power
      or
      privilege hereunder shall operate as a waiver thereof nor shall any single
      or
      partial exercise of any right, power or privilege hereunder preclude the
      simultaneous or later exercise of any other right, power or privilege. The
      rights and remedies herein expressly provided are cumulative and not exclusive
      of any rights or remedies which the Parties would otherwise have.

     

    5.4           Governing
      Law; Jurisdiction.  THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
      IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
      LAW
      OF THE STATE OF NEW YORK WITHOUT REFERENCE TO CONFLICTS OF LAW
      PRINCIPLES.

     

    (a)           Any
      action for enforcement of any judgment may be brought in the courts of the
      State
      of New York or of the United States of America for the Southern District of
      New
      York, and, by execution and delivery of this Agreement, each of the Parties
      hereby accepts for itself and in respect of its property, generally and
      unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
      appellate courts from any appeal thereof.  Each of the Parties
      irrevocably consents to the service of process out of any of the aforementioned
      courts in any such action or proceeding by the mailing of copies thereof by
      registered or certified mail, postage prepaid, to such Party at its notice
      address provided pursuant to Section 5.1 hereof.  Each of the Parties
      hereby irrevocably waives any objection which it may now or hereafter have
      to
      the laying of venue of any of the aforesaid actions or proceedings arising
      out
      of or in connection with this Agreement brought in the courts referred to above
      and hereby further irrevocably waives and agrees not to plead or claim in any
      such court that any such action or proceeding brought in any such court has
      been
      brought in an inconvenient forum.  Nothing herein shall affect the
      right of either Party to serve process in any other manner permitted by law
      or
      to commence legal proceedings or otherwise proceed against the other Party
      in
      any other jurisdiction.

     

    (b)           The
      Parties hereby irrevocably waive, to the fullest extent permitted by Applicable
      Law, any and all rights to trial by jury in any legal proceeding arising out
      of
      or relating to this Agreement or the transactions contemplated
      hereby.

     

    5.5           Counterparts;
      Fax Signatures.  This Agreement may be executed in two or more
      counterparts, each of which shall be deemed to be an original, but all of which
      together shall constitute one and the same instrument. Any such executed
      counterpart may be delivered by facsimile, and, as so delivered, shall be
      legally enforceable in accordance with its terms. Any such facsimile shall
      be
      followed by delivery, as promptly as practicable, of a non-facsimile
      original.

     

    5.6           Assignment.  No
      Party may assign its rights, title and interests under this Agreement without
      the prior written consent of the other Party.  No assignment of this
      Agreement shall relieve the assigning Party of any liability or obligations
      that
      accrued or arise prior to the assignment of this Agreement.  In case
      of any consolidation of Parent with, or merger of Parent into, any other entity,
      or in case of any sale or conveyance of all or substantially all of the assets
      of Parent other than in connection with a plan of complete liquidation of Parent
      at any time prior to the expiration of this Agreement, then as a condition
      of
      such consolidation, merger or sale or conveyance, (a) Parent shall give written
      notice of consolidation, merger, sale or conveyance to AES, and (b) from and
      after the effective date of such consolidation, merger, sale or conveyance,
      the
      surviving entity or purchaser shall be bound by the terms of this
      Agreement.

     

    
      
         

      

      
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    5.7           Resolution
      by Senior Representatives; Arbitration.  

     

    (a)           In
      the event a dispute arises among the Parties regarding the application or
      interpretation of any provision of this Agreement or the performance thereof,
      then any Party may promptly notify the other Party in writing of the dispute
      (including the material details of the dispute) and request a meeting among
      senior representatives.  Each Party shall, within ten (10) calendar
      days, (i) appoint a person not concerned with the day-to-day performance of
      that
      Party’s obligations under this Agreement and who has general decision-making
      authority to resolve and settle the subject dispute on behalf of such Party,
      and
      (ii) agree upon a date and time for the representatives to meet which is no
      later than twenty (20) calendar days from the date of the notice of the
      dispute.  No later than five (5) calendar days prior to the scheduled
      meeting, each Party shall submit to the other a Party a written statement of
      the
      facts and issues surrounding the dispute and its position as to how such dispute
      should be resolved.  At the initial meeting and thereafter, the
      representatives shall negotiate in good faith towards the development of a
      written statement of the terms of settlement of the dispute which written terms
      of settlement, if any, when signed by each Party’s representative, shall serve
      as conclusive evidence of the resolution of such dispute.  If such
      written terms of settlement are not produced and signed by each Party’s
      representative by the date which is the earlier of: (i) fifteen (15) calendar
      days after the date of such representatives’ first meeting, or (ii) forty-five
      (45) calendar days after the date of the notice of dispute whether or not the
      initial meeting of representatives has been scheduled or has occurred by such
      date, or (iii) a later date mutually agreed to by the Parties in writing (the
      “Negotiation End Date”), then, at the written request of either Party, the
      dispute shall be submitted to arbitration in accordance with Section
      5.7(b).

     

    (b)           If
      senior representatives of the Parties shall have failed to resolve the dispute
      as of the Negotiation End Date, then either Party may require that such dispute
      shall be submitted to, and be determined exclusively by, arbitration that shall
      proceed in accordance with the Commercial Arbitration Rules of the American
      Arbitration Association (“AAA”) then in effect (the “Rules”).  Any
      notice of demand for arbitration shall be in writing and shall be delivered
      to
      the other Party and the AAA.  All proceedings before the arbitrators
      shall be held in Chicago, Illinois.  The governing law shall be as
      specified in Section 5.5.  The matter shall be heard by three (3)
      arbitrators, who possess adequate and relevant technical knowledge regarding
      securities laws, one appointed by AES, one appointed by Altairnano and the
      third
      appointed jointly by the first two arbitrators or the AAA if the first two
      arbitrators are otherwise unable to mutually agree within fifteen (15) calendar
      days.  The arbitrators shall not have the right to award special,
      indirect, consequential or punitive damages.  The cost and fees of the
      arbitration, including attorneys’ fees, shall be allocated by the
      arbitrators.  The award (judgment) shall be decided by majority
      opinion and issued in writing and shall state the reasons upon which it is
      based.  It may be made public only with the consent of all
      Parties.  The award rendered by the arbitrator shall be final and
      binding on the Parties and judgment may be entered in accordance with applicable
      law.

     

    5.8           Severability.  The
      provisions of this Agreement shall be severable in the event that any of the
      provisions hereof are held by a court of competent jurisdiction to be invalid,
      void or otherwise unenforceable, and the remaining provisions shall remain
      enforceable to the fullest extent permitted by law.

     

    5.9           Entire
      Agreement.  This Agreement (including any exhibits hereto),
      constitutes the entire agreement with respect to the subject matter hereof
      and
      supersedes all prior agreements, understandings, representations and warranties,
      both written and oral, among the Parties.

    


    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    5.10.           Opinion.  Within
      seven days of the execution of this Agreement, Parent shall deliver to AES
      one
      or more opinions from counsel to Parent in a form and substance reasonably
      acceptable to AES addressing the matters described on Exhibit B attached
      hereto.

    


               IN
      WITNESS WHEREOF, the Parties hereto have signed this Warrant Issuance Agreement
      as of the day and year first above written.

    


    AES
      ENERGY STORAGE, LLC

    


    By:_/s/_____________________________

    Name:
      John Zahurancik________________

    Title:_Vice
      President___________________

    


     ALTAIRNANO,
      INC.

    


    By:
      /s/____________________________

    Name:_Alan
      Gotcher________________

    Title:__President
      and CEO____________

    


    


    ALTAIR
      NANOTECHNOLOGIES, INC.

    


    By:
      /s/____________________________

    Name:_Alan
      Gotcher________________

    Title:__President
      and CEO____________

    


    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    


    EXHIBIT
      A

    


    FORM
      OF
      WARRANT

    


    


    


    [see
      attached]

    


     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    THIS
      WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
      REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
      “ACT”), OR UNDER ANY APPLICABLE STATE SECURITIES LAWS.  THIS WARRANT
      AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT ARE SUBJECT TO
      RESTRICTIONS ON RESALE AND MAY NOT BE RESOLD EXCEPT AS PERMITTED UNDER THE
      ACT
      AND ANY APPLICABLE STATE SECURITIES LAWS.

     

    UNLESS
      PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT
      TRADE THE SECURITY BEFORE [insert date that is four (4) months and one day
      after
      issue date].

    


     

    Warrant
      to Purchase [NUMBER OF SHARES] Common Shares

    of

    Altair
      Nanotechnologies Inc.


     

    WARRANT


     

    Issue
      Date: [ISSUE DATE]


     

    This
      certifies that AES Energy Storage, LLC or its permitted transferee (the
“Holder”) is entitled to purchase from ALTAIR NANOTECHNOLOGIES
      INC., a corporation continued under the Canada Business Corporations Act (the
      “Company”), at the price and during the period as hereinafter
      specified, [NUMBER OF SHARES] shares, (such number of shares, as adjusted as
      provided below, the “Shares”) without nominal or par value, of
      the Company (the “Common Shares”), at a purchase price of
      $EXERCISE PRICE per share, subject to adjustment as described below (as so
      adjusted from time to time, the “Exercise Price”), at any time
      during the period specified in Section 1(a) hereof.

     

    1.           Exercise.  The
      rights represented by this Warrant (the “Warrant”) shall be
      exercisable at the Exercise Price, and during the periods as
      follows:

     

    (a)           At
      any time and from time to time between, the [VESTING DATE] and the four-year
      anniversary of the Issue Date (the “Expiration Date”)
      inclusive, the Holder shall have the right to purchase all or any portion of
      the
      Shares at the Exercise Price.

     

    (b)           After
      the Expiration Date, the Holder shall have no right to purchase all or any
      portion of the Shares hereunder.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    2.           Payment
      for Shares; Issuance of Certificates; Net Exercise.

     

    (a)           The
      rights represented by the Warrant may be exercised at any time within the
      periods above specified, in whole or in part, by (i) the surrender of the
      Warrant (with the purchase form at the end hereof properly executed) at the
      principal executive office of the Company (or such other office or agency of
      the
      Company as it may designate by notice in writing to the Holder at the address
      of
      the Holder appearing on the books of the Company); (ii) payment to the Company
      of the Exercise Price then in effect for the number of Shares specified in
      the
      above-mentioned purchase form together with applicable stock transfer taxes,
      if
      any; and (iii) delivery to the Company of a duly executed agreement signed
      by
      the person(s) designated in the purchase form to the effect that such person(s)
      agree(s) to be bound by the provisions of Section 3. The Warrant shall be deemed
      to have been exercised, in whole or in part to the extent specified, immediately
      prior to the close of business on the date the Warrant is surrendered and
      payment is made in accordance with the foregoing provisions of this Section
      2,
      and the person or persons in whose name or names the certificates for the Shares
      shall be issuable upon such exercise shall become the holder or holders of
      record of such Shares at that time and date. The Shares and the certificates
      for
      the Shares so purchased shall be delivered to the Holder within a reasonable
      time, not exceeding ten (10) business days, after the rights represented by
      this
      Warrant shall have been so exercised.

     

    (b)           Notwithstanding
      anything to the contrary contained in Section 2(a), the Holder may elect to
      exercise this Warrant in whole or in part on a “cashless exercise basis” by
      receiving Shares equal to the value (as determined below) of this Warrant,
      or
      any part hereof, upon surrender of the Warrant at the principal office of the
      Company together with notice of such election in which event the Company shall
      issue to the Holder a number of Shares computed
      using the following formula:

     

    X
      = Y(A-B)

     
                               A

     

    
      	
            	
              Where:

            	
              X
                =  the number of Shares to be issued to the
                Holder;

            


    

     

    Y
      =  the number of Shares issuable upon exercise of this Warrant or, if
      only a portion of this Warrant is being exercised, the portion of this Warrant
      being exercised (at the date of such calculation);

     

    A
      = the
      fair market value of one Common Share (at the date of such calculation);
      and

     

    B
      = the
      Exercise Price (as adjusted to the date of such calculation).

     

    For
      the
      purpose of any computation under this Subsection 2(b), the fair market value
      per
      Common Share at any date shall be deemed to be the Closing Price (as defined
      below) of the Common Shares on the Trading Day immediately preceding the date
      as
      of which the fair market value is being determined, provided that if
      the Common Shares are not then listed or quoted on any market or exchange,
      then
      the fair market value shall be the average of the closing bid prices for the
      Common Shares on the OTC Bulletin Board, or, if such is not available, the
      Pink
      Sheets LLC, or otherwise the average of the closing bid prices for the Common
      Shares quoted by two market-makers of the Common Shares, or otherwise such
      fair
      market value shall be determined in good faith by the Company and the Holders.
      “Trading Day” shall mean any day on which the principal United
      States securities exchange or trading market on which the Common Shares are
      listed, quoted or traded (the “Principal Market”) as reported
      by Bloomberg Financial Markets (“Bloomberg's”) is open for
      trading. “Closing Price” shall mean the average of the last
      sale prices for the Common Shares on the Principal Market for the ten Trading
      Days previous to the date of determination.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    3.           Transfer.    (a)  Any
      transfer of this Warrant shall be effected by the Holder by (i) executing the
      transfer form at the end hereof; and (ii) surrendering the Warrant for
      cancellation at the office or agency of the Company referred to in Section
      2
      hereof, accompanied by (y) a certificate (signed by an officer of the Holder,
      or
      other authorized representative reasonably satisfactory to the Company, if
      the
      Holder is an entity) stating that each transferee is a permitted transferee
      under this Section 3; and, if applicable, (z) an opinion of counsel, reasonably
      satisfactory in form and substance to the Company, to the effect that the Shares
      or the Warrant, as the case may be, may be sold or otherwise transferred without
      registration under the Securities Act of 1933, as amended (the
“Act”).  Notwithstanding the foregoing, the Holder
      agrees that it shall not sell or transfer all or any part of the Warrant or
      the
      Shares to a resident of Canada or a person subject to the securities laws of
      Canada for a period of at least four (4) months and one day from the date
      hereof.

     

    Upon
      any
      transfer of this Warrant or any part thereof in accordance with the first
      sentence of this Section 3(a), the Company shall issue, in the name or names
      specified by the Holder (including the Holder), a new Warrant or Warrants of
      like tenor (including all substantive provisions hereof) and representing in
      the
      aggregate rights to purchase the same number of Shares as are purchasable
      hereunder at such time.

     

    (b)           Any
      attempted transfer of this Warrant or any part thereof in violation of this
      Section 3 shall be null and void ab initio.

     

    (c)           This
      Warrant may not be exercised and neither this Warrant nor any of the Shares,
      nor
      any interest in either, may be offered, sold, assigned, pledged, hypothecated,
      encumbered or in any other manner transferred or disposed of, in whole or in
      part, except in compliance with applicable United States federal and state
      securities laws and applicable Canadian securities laws and the terms and
      conditions hereof.  Each Warrant shall bear a legend in substantially
      the same form as the legend set forth on the first page of this
      Warrant.  Each certificate for Shares issued upon exercise of this
      Warrant, unless at the time of exercise such Shares are acquired pursuant to
      a
      registration statement that has been declared effective under the Act and
      applicable blue sky laws, shall bear a legend substantially in the following
      form:

     

    “THE
      SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
      HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
      AMENDED (THE “ACT”).  SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN
      THE ABSENCE OF REGISTRATION OR AN EXEMPTION THEREFROM.  ALTAIR
      NANOTECHNOLOGIES INC. MAY REQUIRE AN OPINION OF COUNSEL REASONABLY ACCEPTABLE
      TO
      IT THAT A PROPOSED TRANSFER OR SALE IS IN COMPLIANCE WITH THE ACT.”

     

    Additionally,
      similar legends pursuant to Canadian law, as applicable, shall be set forth
      on
      any such Shares or Warrant, as reasonably determined by the Company’s Canadian
      counsel, including the following:

     

    "UNLESS
      PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT
      TRADE THE SECURITY BEFORE [insert date that is four (4) months and one day
      after
      issue date]."


     

    Any
      certificate for any Shares issued at any time in exchange or substitution for
      any certificate for any Shares bearing such legend (except a new certificate
      for
      any Shares issued after the acquisition of such Shares pursuant to a
      registration statement that has been declared effective under the Act) shall
      also bear such legend unless, in the opinion of counsel for the Company, the
      Shares represented thereby need no longer be subject to the restriction
      contained herein.  The provisions of this Section 3(c) shall be
      binding upon all subsequent holders of certificates for Shares bearing the
      above
      legend and all subsequent holders of this Warrant, if any.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    4.           Shares
      to be Fully Paid; Reservation of Shares.  The Company
      covenants and agrees that all Shares which may be purchased hereunder will,
      upon
      issuance and delivery against payment therefor of the requisite purchase price,
      be duly and validly issued, fully paid and non-assessable. The Company further
      covenants and agrees that, during the periods within which the Warrant may
      be
      exercised, the Company will at all times have authorized and reserved a
      sufficient number of Common Shares to provide for the exercise of the
      Warrant.

     

    5.           No
      Voting or Dividend Rights.   The Warrant shall not
      entitle the Holder to any voting rights or any other rights, including without
      limitation notice of meetings of other actions or receipt of dividends or other
      distributions, as a stockholder of the Company.

     

    6.           Adjustment
      of Exercise Price.   The Exercise Price in effect at
      the time and the number and kind of securities purchasable upon the exercise
      of
      this Warrant shall be subject to adjustment from time to time upon the happening
      of certain events as follows:

     

    (a)           In
      case the Company shall (i) declare a dividend or make a distribution on its
      outstanding Common Shares in Common Shares or any other security, (ii) subdivide
      or reclassify its outstanding Common Shares into a greater number of shares,
      (iii) combine or reclassify its outstanding Common Shares into a smaller number
      of shares, or (iv) enter into any transaction whereby the outstanding Common
      Shares are at any time changed into or exchanged for a different number or
      kind
      of shares or other securities of the Company or of another corporation through
      reorganization, merger, consolidation, liquidation or recapitalization, then
      appropriate adjustments in the number of Shares (or other securities for which
      such Shares have previously been exchanged or converted) subject to this Warrant
      shall be made and the Exercise Price in effect at the time of the record date
      for such dividend or distribution or of the effective date of such subdivision,
      combination, reclassification, reorganization, merger, consolidation,
      liquidation or recapitalization shall be proportionately adjusted so that the
      Holder of this Warrant exercised after such date shall be entitled to receive
      the aggregate number and kind of shares or other securities which, if this
      Warrant had been exercised by such Holder immediately prior to such date, the
      Holder would have been entitled to receive upon such dividend, distribution,
      subdivision, combination, reclassification, reorganization, merger,
      consolidation, liquidation or recapitalization. For example, if the Company
      declares a 2 for 1 stock subdivision (split) and the Exercise Price hereof
      immediately prior to such event was $7.00 per Share and the number of Shares
      issuable upon exercise of this Warrant was 85,500, the adjusted Exercise Price
      immediately after such event would be $3.50 per Share and the adjusted number
      of
      Shares issuable upon exercise of this Warrant would be 171,000. Such adjustment
      shall be made successively whenever any event listed above shall
      occur.

     

    (b)           Whenever
      the Exercise Price is adjusted, as herein provided, the Company shall promptly
      cause a notice setting forth the adjusted Exercise Price and adjusted number
      of
      Shares issuable upon exercise of the Warrant to be mailed to the Holder, at
      its
      address set forth herein, and shall cause a certified copy thereof to be mailed
      to the Company's transfer agent, if any. The Company may retain a firm of
      independent certified public accountants selected by the Board of Directors
      (who
      may be the regular accountants employed by the Company) to make any computation
      required by this Section 6, and a certificate signed by such firm shall be
      conclusive evidence of the correctness of such adjustment.

     

    (c)           In
      the event that at any time, as a result of an adjustment made pursuant to the
      provisions of this Section 6, the Holder thereafter shall become entitled to
      receive any shares of the Company other than Common Shares, thereafter the
      number of such other shares so receivable upon exercise of the Warrant shall
      be
      subject to adjustment from time to time in a manner and on terms as nearly
      equivalent as practicable to the provisions with respect to the Common Shares
      contained in Section 6(a)  above.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (d)           The
      Company shall provide the Holder with prior written actual notice (receipt
      confirmed) of any event described in Section 6(a) at least ten (10) days prior
      to the record date with respect to such event.  In addition, the
      Company shall deliver to the Holder copies of any and all information it is
      required to deliver to its shareholders with respect to such event at the same
      time such information is delivered to shareholders.

     

    7.           Governing
      Law.   This Agreement shall be governed by and in
      accordance with the laws of the State of New York without regard to conflicts
      of
      laws principles thereof.

     

    8.           Binding
      Effect on Successors.   In case of any consolidation
      of the Company with, or merger of the Company into, any other entity, or in
      case
      of any sale or conveyance of all or substantially all of the assets of the
      Company other than in connection with a plan of complete liquidation of the
      Company at any time prior to the Expiration Date, then as a condition of such
      consolidation, merger or sale or conveyance, the Company shall give written
      notice of consolidation, merger, sale or conveyance to the Holder and, from
      and
      after the effective date of such consolidation, merger, sale or conveyance
      the
      Warrant shall represent only the right to receive the consideration that would
      have been issuable in respect of the Shares underlying the Warrant in such
      consolidation, merger, sale or conveyance had the Warrant been exercised in
      full
      immediately prior to such effective time and the Holder shall have no further
      rights under this Warrant other than the right to receive such
      consideration.

     

    9.           Fractional
      Shares.  No fractional shares shall be issued upon
      exercise of this Warrant.  The Company shall, in lieu of issuing any
      fractional share, pay the holder entitled to such fraction a sum in cash equal
      to such fraction multiplied by the then effective Exercise Price.

     

    10.           Lost
      Warrants.   The Company represents and warrants to
      the Holder hereof that upon receipt of evidence reasonably satisfactory to
      the
      Company of the loss, theft, destruction, or mutilation of this Warrant and,
      in
      the case of any such loss, theft or destruction, upon receipt of an affidavit
      of
      loss and indemnity reasonably satisfactory to the Company, or in the case of
      any
      such mutilation upon surrender and cancellation of such Warrant, the Company,
      at
      its expense, will make and deliver a new Warrant, of like tenor, in lieu of
      the
      lost, stolen, destroyed or mutilated Warrant.

     

    11.           Headings.   The
      headings of the several sections and paragraphs of this Warrant are inserted
      for
      convenience only and do not constitute a part of this Warrant.

     

    12.           Modification
      and Waiver.   This Warrant and any provision hereof
      may be changed, waived, discharged or terminated only by an instrument in
      writing signed by the party against which enforcement of the same is
      sought.

     

    13.           Survival.  The
      rights and obligations of the Company, of the Holder and of the holder of Shares
      issued upon exercise of this Warrant shall survive the exercise of this
      Warrant.

     

    14.           Remedies.  The
      Company stipulates that the remedies at law of the Holder in the event of any
      default or threatened default by the Company in the performance of or compliance
      with any of the terms of this Warrant are not and will not be adequate and
      that,
      to the fullest extent permitted by law, such terms may be specifically enforced
      by a decree for the specific performance of any agreement contained herein
      or by
      an injunction against a violation of any of the terms hereof or
      otherwise.

     

    15.           Reservation
      of Shares.  The Company covenants and agrees that all
      Shares which may be purchased hereunder will, upon issuance and delivery against
      payment therefor of the requisite purchase price, be duly and validly issued,
      fully paid and non-assessable. The Company further covenants and agrees that,
      during the periods within which the Warrant may be exercised, the Company will
      at all times have authorized and reserved a sufficient number of Common Shares
      to provide for the exercise of the Warrant.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    16.           Will
      Secure Governmental Approvals.  If any of the Shares
      required to be reserved for the purposes of exercise of this Warrant require
      registration with or approval of any governmental authority under any law of
      the
      United States or its constituent states (other than the Securities Act) before
      such Shares may be issued upon exercise of this Warrant (other than as a result
      of a breach by AES of its representations and warranties to the Company or
      an
      assignment of this Warrant by AES), the Company will, at its expense, as
      expeditiously as possible use its commercially reasonable efforts to cause
      such
      Shares to be duly registered or approved, as the case may be.

     

    17.           No
      Obligations as Shareholder.  No provision hereof, in the
      absence of affirmative action by the Holder hereof to purchase Shares, and
      no
      mere enumeration herein of the rights or privileges of the Holder hereof, shall
      give rise to any liability of such Holder for the Exercise Price or as a
      shareholder of the Company, whether such liability is asserted by the Company
      or
      by creditors of the Company.

     

    18.           Taxes
      Payable Upon Exercise.  The Company shall pay any stock
      issuance, transfer or similar taxes that may be payable in respect of the
      issuance of Shares upon exercise of this Warrant.  For purposes of
      clarity, the Company shall not be required to pay any federal, state, local
      or
      foreign income taxes, if any, payable by the Holder or any other person upon
      exercise of this Warrant, or any taxes which may be payable in respect of any
      transfer involved in the issuance of Shares in the name other than that in
      which
      this Warrant is registered, and the Company shall not be required to issue
      or
      deliver any such Shares unless and until the person requesting such issuance
      shall have paid to the Company the amount of any such transfer taxes, or shall
      have established to the satisfaction of the Company that such taxes have been
      paid.

     

    19.           Notice
      to Cash or Similar Dividend.  The Company shall provide
      the Holder with written actual notice (receipt confirmed) of any dividend or
      other distribution of assets (other than a distribution described in Section
      6(a)) at least ten (10) days prior to the record date for such dividend or
      other
      distribution.

     

    20.       Notices.  All
      notices or other communications which are required or permitted hereunder shall
      be in writing and shall be deemed sufficiently given if delivered personally
      (as
      confirmed by signature of receiving party) or sent by nationally recognized
      overnight courier postage prepaid (as confirmed by signature of receiving party)
      to the address set forth below or to such other address as any party may have
      specified in a notice duly given to the other party as provided herein. Such
      notice of communication shall be deemed to have been given as of the date
      received.

     

    If
      to
      Altairnano:

    Altairnano,
      Inc.

    204
      Edison Way

    Reno,
      Nevada  89502

    Attn:  Alan
      Gotcher, CEO and President

    


    If
      to
      AES:

    


    AES
      Energy Storage, LLC

    c/o
      The
      AES Corporation

    4300
      Wilson Boulevard

    Arlington,
      Virginia 22203

    Attention:
      Chris Shelton

    


    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    With
      a
      copy to:

    


    AES
      Energy Storage, LLC

    c/o
      The
      AES Corporation

    4300
      Wilson Boulevard

    Arlington,
      Virginia 22203

    Attention:
      General Counsel

    


    IN
      WITNESS WHEREOF, the Company has
      caused this Warrant to be signed by its duly authorized officers.

    


     

    ALTAIR
      NANOTECHNOLOGIES INC.

    


     

    By:______________________________

              Name:

              Title:

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    PURCHASE
      FORM

     

    (To
      be
      signed only upon exercise of Warrant)

    


     

    The
      undersigned, the holder of the foregoing Warrant, hereby irrevocably elects
      to
      exercise the purchase rights represented by such Warrant for, and to purchase
      thereunder, _______________ Common Shares, without nominal or par value per
      share (the “Shares”), of ALTAIR NANOTECHNOLOGIES INC. and
      either tenders herewith payment of the aggregate Exercise Price in respect
      of
      the Shares in full, in the amount of $_________; or elects pursuant to Section
      2(b) of such Warrant into Common Shares on a cashless basis and requests that
      the certificates for the Shares be issued in the name(s) of, and delivered
      to
      _________________, whose address(es) is (are):

     

     

    Dated:   __________________________

     

     

                                              By:

                                                   ___________________________

     

                                                   ___________________________

     

                                                   ___________________________

                                                   Address

     

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    TRANSFER
      FORM

     

    (To
      be
      signed only upon transfer of Warrant)

    


     

    For
      value
      received, the undersigned hereby sells, assigns, and transfers unto
      ______________________________ the right to purchase Shares represented by
      the
      foregoing Warrant to the extent of __________ Shares, and appoints
      _________________________ attorney to transfer such rights on the books of
      Altair Nanotechnologies Inc., with full power of substitution in the
      premises.

    


     

    Dated:  ____________________________

     

     

                                              By:

                                                   _____________________________

     

                                                   _____________________________

     

                                                   _____________________________

                                                   Address

     

     

    In
      the
      presence of:

     

     

    ___________________________

     

    


    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    EXHIBIT
      B


    


    SUBSTANTIVE
      MATTERS TO BE ADDRESSED IN OPINION

    


    Canadian
      Law Opinions:

    


    Parent
      is
      a corporation existing under the laws of Canada.

    


    Parent
      has the corporate power and authority to enter into the Agreement, and to
      consummate the transactions contemplated thereby, including the issuance and
      delivery of the Initial Warrants and the Milestone Warrants (collectively,
      the
“Warrants”) to AES and the issuance and delivery of the Common Shares issuable
      upon exercise of the Warrants (the “Warrant Shares”) to the holder of the
      Warrants upon the proper exercise thereof, including payment of the exercise
      price.

    


    Parent
      has taken all necessary corporate action to authorize the execution and delivery
      by it of the Agreement and the performance by Parent of its obligations under
      the Agreement, including the issuance and delivery of the Warrants to AES and
      the issuance and delivery of the Common Shares issuable upon exercise of the
      Warrants.

    


    To
      the
      extent that such matters are governed by the laws of the Province of Ontario
      and
      the laws of Canada applicable therein, each of the Agreement and the Initial
      Warrant has been duly executed and delivered by Parent.

    


    The
      Warrant Shares have been validly created and allotted and, when issued to the
      holder of the Warrant in accordance with the terms of the Warrant, will be
      validly issued and outstanding as fully paid and non-assessable Common Shares
      of
      Parent.

    


    To
      the
      extent that such matters are governed by the laws of the Province of Ontario
      and
      the laws of Canada applicable therein, no consent, approval, order or
      authorization of, or registration, qualification, designation, declaration
      or
      filing with, any governmental authority is required in connection with the
      execution and delivery by the Parent of the Agreement or the performance by
      Parent of its obligations under the Agreement.

    


    U.S.
      Law
      Opinions:

    


    No
      consent, approval, order or authorization of, or registration, qualification,
      designation, declaration or filing with, any federal, state or local
      governmental authority on the part of Parent is required in connection with
      the
      execution and performance of the Warrant Issuance Agreement, other than (i)
      the
      completion, execution and filing of a Form D with the United States Securities
      and Exchange Commission (the “Commission”) following execution of the Warrant
      Issuance Agreement, (ii) the completion, execution and filing of a Form D and
      related documentation with, and the payment of required fees to, the securities
      divisions of applicable states following the execution of the Warrant Issuance
      Agreement, and (iii) the completion, execution and filing of a Current Report
      on
      Form 8-K with the Commission reporting the execution of the Warrant Issuance
      Agreement and filing certain documents as exhibits.

    


    Each
      of
      the Warrant Issuance Agreement and the Initial Warrant constitutes the valid
      and
      binding agreement of Parent, enforceable against Parent in accordance with
      its
      terms.