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| A.   | Atlas was the owner of 100% of the equity interests in its wholly owned subsidiary, Nano Clay & Technologies, Inc. (“NCT”).  NCT has been administratively dissolved by the Secretary of State of Idaho and no longer exists.  Atlas is a party to this Agreement in itsown right and as successor to whatever rights it may have with respect to NCT. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B.   | Price executed an Employment Agreement dated March 9, 2006 (“Employment Agreement”) (a copy of which is attached hereto as Exhibit A), which provided that he would serve as President, Chief Executive Officer, and a director of NCTand would continue as a director of Atlas. |
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| C.   | Given (i) the dissolution of NCT and the responsibility of Price as director, president and CEO of NCT for the dissolution and (ii) Price’s execution and delivery in 2007 of his resignation as a director of Atlas and an agreement terminating his positions with NCT, Atlas believes that the Employment Agreement may have already been terminated, butis nevertheless willing to enter into the Agreement; in the event of Price’s breach of this Agreement, Atlas maintains all rights to assert that the Employment Agreement had been terminated prior to execution of this Agreement. |
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| D.   | The parties have agreed that it is in the best interest of Price and Atlas to expressly terminate the Employment Agreement and Price’s relationships with NCT and Atlas as set forth above and to enter into this Agreement |
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| 1.   | Termination of Employment Agreement.  The parties agree that the Employment Agreement attached as Exhibit A is a true and correct copy of Employment Agreement and is the only employment or similar agreement (written or oral) involving Price and Atlas or NCT.  The parties agreethat to the extent the Employment Agreement was not previously terminated by virtue of the matters set forth in the recitals hereto, it is terminated upon the execution of this Agreement.  The parties recognize that given the dissolution of NCT, there could be ambiguity as to Price’s status as an officer and director of NCT.  For purposes of clarity and to resolve any doubt,  Price resigns as an officer and director of NCT effective upon the execution of this Agreement.  Alsoon the date of this Agreement, Price resigns as a director of Atlas and from any other position he may hold with Atlas or any of its subsidiaries.  All such termination and resignations are voluntary and made without coercion.  To the extent that Atlas needs to accept such resignation(s), it hereby does so . Price represents that he does not and did not hold any other position with Atlas other than director or NCT other than president, CEO, and director and does not hold any positions withany subsidiary of Atlas other than NCT. Price agrees that upon the termination of the Employment Agreement, he has no right to employment by Atlas or NCT. |
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|   | a. |    Price, on behalf of himself and his marital community, heirs, executors, administrators and assigns, except as discussed below, expressly releases and waives against NCT and Atlas and their respective current and former officers, directors, stockholders, managers, employees, agents, trustees, representatives, general and limited partners, members and attorneys (all of which are collectively referredto as “Released Parties”) any and all claims, damages, causes of action or disputes, whether known or unknown, based upon acts or omissions relating to Price’s employment or the end of his employment with NCT and Atlas, occurring or that could be alleged to have occurred on or prior to the execution of this Agreement; and further releases, discharges and acquits Released Parties, individually and in their representative capacities, from such claims, damages, |
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|   | b. | Price represents and acknowledges that he has not filed any complaint, charge, claim or proceeding, except with respect to Unreleased Claims, if any, against any of the Released Parties before any local, state or federal agency, court or other body (each individually a “Proceeding”).  Price also represents that he is not aware of any basis on which such a Proceeding could reasonably be instituted.  Priceunderstands and acknowledges that he is waiving any right he may have to benefit in any manner from any relief (whether monetary or otherwise) arising out of any Proceeding, including any Proceeding conducted by the EEOC Price understands that, by executing this Agreement, he is limiting the availability of certain remedies he might have against the Released Parties.  If Price is ever awarded or recover in any forum any amount as to a claim Price has waives in this Agreement, such amounts shall be payableto Atlas and Price hereby assigns the right to any such amounts to Atlas; and |
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|   | c. | Price acknowledges and agrees that except as required by this Agreement, (i) NCT and Atlas have no obligation to provide any of the consideration in Section 7,  (ii) the consideration set forth in paragraph 7 is consideration for Price’s representations, covenants and release herein, and (iii) the consideration in Section 7 constitute adequate consideration for Price’s representations, covenantsand release set forth in this Agreement. |
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|   | d. | Price acknowledges that, other than as discussed herein, he is knowingly and voluntarily waiving and releasing any rights he may have under the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act of 1990 and further acknowledges that he been advised by this writing, as required by the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act of 1990, that (a)his waiver and release do not apply to any rights or claims that may arise after he executes this Agreement; (b) he has a right to, and has been advised to, consult with an attorney regarding this Agreement and its effects prior to executing this Agreement; (c) he has at least twenty-one (21) days from the date this Agreement is received to consider this Agreement (although he may voluntarily choose to execute this Agreement earlier); and (d) he has seven (7) days after accepting this Agreement to revoke hisacceptance, and his acceptance will not be effective until that revocation period has expired. To revoke this Agreement, Price understands that he must deliver a written and |
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| 3. | Price Not Entitled to Benefits of the Employment Agreement. For purposes of clarity as to the termination of the Employment Agreement, except as set forth in the next paragraph, upon the termination of the Employment Agreement and his resignations, it is agreed as follows: |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| a.   | Price will not be entitled, after the Effective Date, to salary under paragraph 4.A of the Employment Agreement; |
|----------------|------------------------------------------------------------------------------------------------------------------|

| b.   | Price will not be entitled to participate in any plans under paragraph 4.C.  The only plans he currently participates immediately before the Effective Date are group life insurance, which will be cancelled, and a 401(k); |
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| c.   | Price will not be entitled to benefits under paragraph 4.D, including company credit card and cell phone; |
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| d.   | Price will not be entitled to participate in any bonus program under paragraph 4.E.  It is agreed that Price is not entitled to any bonus for periods prior to the Effective Date; |
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| e.   | He is not entitled to any patent ownership under paragraph 4.F.  Price represents that he has not filed any patents while employed by Atlas or NCT; |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | Price is not entitled to any vacations under paragraph 6 and as of the Effective Date, he has accrued not vacation time; |
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| g.   | There is no key man life insurance policy as described in paragraph 7; |
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| h.   | Price will not be entitled to severance under paragraph 9. |
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| 4.   | Amounts Due Prior to Termination of Employment Agreement; Return of Property.  Salary accrued under the Employment Agreement through the Effective Date will be paid in accordance with the usual payroll practices of Atlas.  Unreimbursed but reimbursable expenses on or prior to theEffective Date are set forth in Exhibit B and will be promptly reimbursed by Atlas.  Price represents that such expenses are all of his reimbursable expenses and as proper expenses on behalf of the Atlas.  Price will promptly return all property of Atlas and NCT in his possession or under his control, including the property listed on Exhibit C and shall certify that he has done sowithin 10 days of the Effective Date. |
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| 5.   | Stock Option Agreement.  The Non-Qualified Stock Option Agreement dated July 14, 2006 (“Stock Option Agreement”) attached as Exhibit D is a true and correct copy ofStock Option Agreement and is the only agreement (written or oral) relating to securities or options to acquire securities or profit sharing involving Price and Atlas or NCT.  The parties agree that the Stock Option Agreement is not terminated and continues in effect, but for purposes of paragraph 6 of the Stock Option Agreement, Price is deemed have terminated from Atlas and NCT as of the Effective Date but such termination will be other than by reason of death or “for cause.” |
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| 6.   | Price’s Contacts and Agreements; Discoveries.  Price represents that Exhibit E is a true and correct list, of (a) persons and entities that he solicited as purchasers or potential purchasers of, or joint venture partners or participantsconcerning, halloysite or other minerals from the Dragon Mine, (b) persons or entities to whom any halloysite clay from the Dragon Mine was delivered for evaluation or testing and the substance of any reports from such persons or entities (c) agreements with any persons or entities relating to halloysite from Dragon Mine and (d) all persons he accompanied to the Dragon Miner who were not employees or directors of Atlas or NCT. Price represents that Exhibit F setsforth a true and correct list of the patentable discoveries or inventions of Price while in the employ of Atlas or NCT and any research regarding the processing of halloysite clay or other minerals from the Dragon Mine and the results of such research. |
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| 7.   | Payments to Price. In exchange for the termination of the Employment Agreement, Price’s resignations and Price’s other agreements set forth herein, Atlas agrees to compensate Price as follows.  For the period from the Effective Date hereof until February 28, 2009, Price willbe paid at the rate of $200,000 per year for total payments of $      and thereafter for the one year period beginning March 1, 2009 and ending February 28, 2010, he will be paid at the rate of $50,000 per year, monthly in arrears.  Except with respect to matters as to which Atlas’ indemnification bylaws apply, Price shall be entitled to reimbursement for all properly documented expenses reasonably incurred and pre-approved by an officer of Atlas in connection withrendering services pursuant to this Agreement, including, but not limited to, reimbursement for all reasonable travel, lodging, and meal expenses.  Such amount will be paid in installments in accordance with Atlas’ usual paying practices. The foregoing is subject to the proviso that  as condition precedent to being entitled to receive and retain any compensation set forth in this Paragraph 7, the representations made by Price in this Agreement and the Exhibits thereto are true and correctwhen made and continue to be true and correct through February 28, 2010 and Price does not violate any of the covenants made by him in this Agreement before February 28, 2010.  If any representations made by Price in this Agreement or the exhibits thereto cease to be true at any time before February 28, 2010 or if Price violates before February 28, 2010 any of the covenants made by Price in this Agreement, Price will promptly notify Atlas in writing. |
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| 8.   | Cooperation and Services.  From and after the Effective Date, Price agrees and covenants that he shall cooperate fully with and assist in all respects Atlas and NCT and their directors, executive officers, senior-level employees, insurers, duly authorized agents, successors, trustees, assigns,  attorneysand experts acting on behalf of the Company:  (i) with the transfer or transition of any work, projects, assignments, tasks or duties performed by or assigned to Price on or before the Effective Date, and (ii) with the conduct of any formal or informal dispute, claim, litigation, arbitration, grievance, interview, meeting, action, proceeding,  investigation, regulatory or administrative inquiry, or similar matters or proceedings, including, without limitation, proceedings involvingstate or federal agencies or self-regulated organizations, involving Atlas or NCT and their directors, executive officers, senior-level employees, or subsidiaries, including, without limitation, about which Price may have relevant information or knowledge, or had access to such information or knowledge.  Nothing in this Agreement shall require Price to identify the information he has provided to, or disclose his communications with, agencies of government or self-regulatory organizations.  Hiscooperation and assistance shall he provided at a time and in a manner which is mutually and reasonably agreeable to Price and Atlas, and may include, without limitation, providing information and documents, submitting to interviews, submitting to depositions, providing testimony and general cooperation to assist the Company or NCT and their directors, executive officers, senior-level employees, or subsidiaries.  To the extent he is entitled, Price will retain the right of indemnification as providedunder Atlas’ bylaws. |
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| 9.   | Confidential Information. Price agrees and covenants that at all times he will maintain in confidence, and not disclose to any person or entity or otherwise use, any Confidential Information.  Further, Price agrees that he will not use any Confidential Information received by Atlas or NCTfrom a third party in any manner inconsistent with any agreement between Atlas or NCT and such third party of which he is made aware. Price acknowledges that all memoranda, notes, documents, drawings, specifications, software, media and other materials containing any Confidential Information are the exclusive property of Atlas or NCT and agrees to immediately deliver to Atlas or NCT all such material in his possession or control. “Confidential Information” means any (i) information |
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| 10.   | Non-Competition; Non-Solicitation.  Price agrees and covenants that until February 28, 2010, he will not: |
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|   |  a.  Directly or indirectly participate in the marketing or sale of minerals containing halloysite or kaolin of the same or superior quality as the quality of the minerals that can be extracted from the Dragon Mine; |
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| b.   | Directly or indirectly encourage, solicit, or attempt to induce (or assist others to encourage, solicit, or attempt to induce) any employee or consultant of Atlas to terminate his/her relationship with Atlas or to work elsewhere with Price or any other business, person or activity. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.   | Non-Disparagement.  Price agrees and covenants that he will not, and will not permit his agents or representatives, to criticize, ridicule or make any comment or statement which disparages or is derogatory of Atlas or any of its affiliates or directors, officers, employees or trustees orgoods or services in any communication with the press or other media, any customer or potential customer or any employee or director or potential employee or director of Atlas, or its affiliates; provided, however that nothing herein will prevent Price from giving truthful testimony if properly subpoenaed to testify under oath. Atlas agrees that its executive officers and directors will not, and that Atlas will not authorize, consent, permit or encourage any employee or agent to, criticize, ridicule or make |
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| 12.   | Inventions, Copyrights and Patents. |
|-----------------|-------------------------------------|

| (i)   | All patents, copyrights, trade secrets, and other proprietary rights in the Materials and all rights to prosecute applications, and to secure registrations, renewals, and extensions of the same; |
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| (ii)   | All rights to make use, practice, import, export, and otherwise fully exploit the Materials and any and all improvements that Atlas may develop; |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

| (iii)   | All rights under any letters patent issued on the Materials or improvements thereon, and any processes and designs therein, and all rights to enjoy the same; and |
|-------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (iv)   | All documents, notes, notebooks, drawings, schematics, prototypes, magnetically encoded media, or other information or materials related to the Materials. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.   | Reasonableness of Covenants and Assignments.  Price acknowledges that he has carefully read all of the terms of paragraphs 2, 8, 9, 10, 11 and 12 of this Agreement, that he has been advised by Atlas to seek legal advice to assist him in this and agrees that all of such terms are necessaryfor the reasonable and proper protection of Atlas’s business, that Atlas has been induced to enter into its relationship with him and provide the consideration described herein upon his representations that he will abide by and be bound by each of such terms, and that each term is reasonable in its scope and duration. If for any reason any portion of paragraphs 2, 8, 9, 10, 11 and 12 of this Agreement shall be held by a court of competent jurisdiction to be invalid or unenforceable, the parties agree thatthe remaining portions of paragraphs 2, 8, 9, 10, 11 and 12 of this Agreement shall remain in full force and effect and that such court, upon the request of Atlas, may construe and/or modify such invalid or unenforceable portion in a valid and enforceable manner that most closely reflects the effect and intent of the original language. Price acknowledges that he has not filed or caused to be filed any lawsuit, complaint or charge with respect to any claim this Agreement purports to release. Price furtheracknowledges that in executing this Agreement, he did not rely upon any representation or statement by any representative of Atlas or other parry concerning the subject matter of this Agreement. |
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| 14.   | Injunctive Relief.  Price acknowledges that Atlas has no adequate remedy at law and will be irreparably harmed if Price breaches or threatens to breach the provisions of paragraphs 2, 8, 9, 10, 11 or 12 of this Agreement and, therefore, agrees that Atlas shall be entitled to injunctive reliefto prevent any breach or threatened breach of such section and that Atlas shall be entitled to specific performance of the terms of such section in addition to any other legal or equitable remedy it may have. In the event of a material breach of paragraph 2, 8, 9, 10, 11, or 12, Atlas shall be relieved of the obligation to continue to provide or pay any compensation or benefits otherwise payable under this Agreement. Nothing in this Agreement shall be construed as prohibiting Atlas from pursuing any other remediesat law or in equity that it may have or any other rights that it may have under any other agreement. |
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| 15.   | Withholding.  Anything in this Agreement to the contrary notwithstanding, all payments required to be made by Atlas hereunder to Price will be, to the extent required by law, subject to withholding, at the time payments are actually made to Price and received by him, of such amounts relatingto taxes as Atlas may reasonably determine it should withhold pursuant to any applicable law or regulation. In lieu of withholding such amounts required by law., in whole or in part, Atlas may, in its sole discretion, accept other provision for payment of taxes as required by law, provided that it is satisfied that all requirements of law as to its responsibilities to withhold such taxes have been satisfied. |
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| 16.   | Arbitration.  Except as provided in paragraph 12, the parties agree that any dispute arising out of this Agreement shall be resolved by the parties through confidential mediation or final and binding confidential arbitration. The parties will first attempt to mediate the dispute before aneutral mediator agreed upon by the parties. If mediation is not successful, the dispute will be submitted to final and binding confidential arbitration before a neutral arbitrator agreed upon by the parties. Except as specifically provided herein, the mediation or arbitration shall be governed by the rules of the American Arbitration Association or such other rules as agreed to by the parties. Both parties agree that the procedures outlined in this paragraph 14 are the exclusive methods of dispute resolution,except for any action by Atlas for injunctive relief, which may be brought under paragraph 12 of |
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| 17.   | Successors. This Agreement is personal to Price and without the prior written consent of Atlas shall not be assignable by Price otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by Price’s heirs and legal representatives.This Agreement shall inure to the benefit of and be binding upon Atlas and its successors and assigns. This Agreement supersedes all prior agreements pertaining to the subject matter of this Agreement. |
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| 18.   | Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without reference to principles of choice of law. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto ortheir respective successors or legal representatives. |
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| 19.   | Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party, by nationally recognized overnight courier, or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: |
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| 21.   | No Penalty. None of the provisions of this Agreement shall be deemed to impose a penalty. |
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| 22.   | Enforceability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. |
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| 23.   | No Waiver. Any party’s failure to insist upon strict compliance with any provision hereof shall not be deemed to be a waiver of such provision or any other provision hereof. |
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| 24.   | Integration. No promises or other communications made by either Atlas or Price are intended to be binding unless they are set forth in this Agreement. This Agreement contains the entire agreement between the parties with respect to the matters that are the subject hereof and replaces and supersedesany prior agreements, including the Employment Agreement. Price hereby acknowledges that any compensation or benefits Price otherwise may have been entitled to under the Employment Agreement are hereby waived. |
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| 25.   | Interpretation.  You acknowledge that before entering into this Agreement, you have had the opportunity to consult with an attorney or other advisor of your choice, and you have been advised to do so if you choose.  You further acknowledge that you have entered into this Agreementof your own free will, and that no promises or representations have been made to you by any person to induce you to enter into this Agreement other than the express terms set forth herein.  You further acknowledge that you have read this Agreement and understand all of its terms, including the waiver and release of claims set forth in Section 1 above.  In the event of a dispute between the parties as to this Agreement, no party shall be entitled to the benefit of any principle of contractconstruction premised upon the relative bargaining power of the parties, the identity of the party partly or wholly responsible for drafting the portion of this Agreement giving rise to the dispute, contraproferentum, contracts of adhesion, or any similar contract construction principle. |
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| 26.   | Knowing and Voluntary Agreement. Price warrants and represents that: |
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| 27.   | Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. |
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|                                  | Atlas Mining Company                                                                                           |
|---------------------------------------|----------------------------------------------------------------------------------------------------------------|
|  Ronald Price Date: _______ |  By:  ________________________                                                                  |
|                                  |         Its Chief Executive Officer Date:  ____________ |

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| a.   | i)           for the first year of the Term of Employment, a salary at the annual rate of $150,000; |
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| (i)   | for the second year of the Term of Employment, a salary at the annual rate of $175,000; |
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| (ii)   | for the third year of the Term of Employment, a salary at the annual rate of $200,000; |
|------------------|----------------------------------------------------------------------------------------|

| b.   | Such salary will be paid in regular installments in accordance with the Company’s usual paying practices, but not less frequently than semi-monthly.  Such payments will be subject to such deductions by the Company as the Company is from time to time required to make pursuant to law, government regulations, or order, or by agreement withor consent of Executive. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | Executive shall be entitled to participate in all group life insurance, medical and hospitalization plans and pension and profit sharing plans as are presently offered by the Company or which may hereafter during the Term of Employment be offered by the Company generally to its operating executives. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Executive shall be entitled to use of Company credit card, cell phone and other items necessary for Executive to carry out his duties. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------|

| e.   | Executive is entitled to a bonus program based on achieved profitability through the Company’s activities.  Bonus payments will be no more than 40% of Executive base salary (as noted in 4.A. above).  Payments may be in the form of cash or common stock as mutually agreed by the Executive and the Company. |
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| f.   | The Executive is entitles to 20% ownership of any patents filed by the Executive on behalf of the Company. |
|----------------|------------------------------------------------------------------------------------------------------------|

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| 3. | Vesting of Option. The right to exercise this Option shall vest in installments, and this |
|----|------------------------------------------------------------------------------------------------|

|   | Option shall be exercisable from time to time in whole or in part as to any vested installment, as |
|--------|----------------------------------------------------------------------------------------------------|

|   | follows: |
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| Person Contacted | Entity Person Associated With | Approximate Dates of Contacts | Substance of Solicitation | Results of Solicitation |
|------------------|-------------------------------|-------------------------------|---------------------------|-------------------------|
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |
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|             |                          |                          |                      |                    |
|             |                          |                          |                      |                    |

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