[EXHIBIT 10.3]

                 Memorandum of Understanding

      The purpose of this memorandum  of understanding is to
set  forth  certain non-binding understandings  and  binding
agreements  between  Third-Order Nanotechnologies,  Inc.,  a
Nevada  corporation ("TDON"), and Photon-X, LLC, a  Delaware
limited liability company ("Photon X") , with respect to our
recent   discussions   regarding  the  two-phase   strategic
alliance  as  described  below.   TDON  and  Photon  X   are
sometimes  referred to herein as a "party" and  collectively
as the "parties."

1.0   Understanding.   The  following  section  reflects  our
      understanding of the matters described but are not legally
      binding and do not impose an enforceable obligation  on
      either of us to negotiate or conclude an agreement regarding
      the supposed strategic alliance on such terms.  This is not
      a complete statement of all terms and conditions of the
      proposed  strategic alliance, but provides a basis  for
      further negotiations.

1.1   Phase One.

       A.   Alliance Structure.  TDON shall enter into a "fee for
            ------------------
            services" agreement with Photon-X, which shall be payable by
            TDON to Photon-X, 50% up front an  50% upon completion of
            Phase One, or at Photon-X's discretion, accrued for
            conversion into Third-Order common stock equity and/or
            warrants pursuant to the terms of any such equity offering
            conducted by TDON at the time of it's secondary offering.

       B.   Product/Service.  Produce and evaluate waveguide
            ---------------
            structures based on Third-Order's revolutionary Cyclic
            Surface Conduction (CSC) polymer materials.  The envisioned
            activities to be performed by Photon-X may potentially
            include working with additional parties (eg. Universities,
            lead customers, etc.).

       C.   Scope.  Third-Order will assist Photon-X  in
            -----
            understanding the molecular composition of it's material
            platform, suggest processing conditions, and participate in
            characterization testing.  Waveguide processing shall take
            place at Photon-X's facility.

1.2  Phase Two.

       A.   Alliance Structure.  TDON shall enter into a "Fee for
            ------------------
            Services" agreement with Photon-X, which shall be payable by
            TDON to Photon-X, 50% up front and 50% upon completion of
            Phase Two.  Charges shall be reviewed on a monthly basis by
            Third-Order.  The parties shall enter into good faith
            negotiations regarding potential establishment of strategic
            alliance, creation of a Joint Venture, etc.


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       B.   Products/Services.  To design, develop, produce and
            -----------------
            market electro-optic components based on Third-Order's
            polymer technology.

       C.   Scope.
            -----

              i.  Third-Order and Photon-X will provide the necessary
                  level of engineering resources to design and process
                  electro-optic devices based upon Third-Order's materials
                  and Photon-X's unique processing capabilities. The
                  companies will endeavor to use best reasonable efforts to
                  create devices with optimized electr-optic performance and
                  strong market demand potential (eg. 40Gb/s and 100Gb/s EO
                  Modulators).
             ii.  Characterization and qualification testing may occur at
                  Third-Order's facility, Photon-X's facility, at both
                  locations, and/or at a third party facility as required.
            iii.  Limited quantities (not to exceed 21 units) of devices
                  created under Phase Two may be marketed by either party
                  through the party's market channel(s) as a vehicle to
                  develop appropriate markets; however no commitment to
                  volume production and/or pricing should be made by either
                  party unless and until a final alliance Structure is
                  established.

                               Section 2
                   Certain Covenants and Restrictions

2.0   Agreement.  By signing this Memorandum of
      Understanding,  the parties agree that the following
      paragraphs will constitute a legally binding and enforceable
      agreement between the parties.  In consideration of the
      significant expenses that both parties will incur in
      pursuing a strategic alliance with respect to the mutual
      undertakings described, the parties agree as follows:


2.1   Mutual Non-Disclosure Agreements. Simultaneously with
      this memorandum of Understanding, each of the parties
      shall execute a Mutual Non-Disclosure agreement that
      shall enable appropriate detailed discussions to take
      place relative to work plans, time lines, technical
      specifications, production techniques, IP contributions
      and the possibility of further agreements between Third-
      Order and Photon-X.

2.2   Good Faith Negotiations.  The parties shall negotiate
      in good faith and use their best efforts to arrive at
      agreements with respect to the strategic alliance as
      described herein.


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2.3   Access to Information.  The parties shall make
      available to each other all information necessary to
      effectuate the intent of this Memorandum of Understanding.
      To facilitate such exchange of information, the parties
      shall each provide to each other a designated person of
      contact.


2.4   Confidentiality and Public Announcements.  Both parties
      agree to allow public disclosure of the existence of this
      Memorandum of Understanding between the parties and
      publications of test results; however, the parties shall
      consult with each other and agree as to the timing, content,
      and form before issuing any press release or other public
      disclosure related thereto, and such permission will not be
      unreasonably withheld by either party.  Notwithstanding the
      previous sentence, nothing herein shall prohibit TDON from
      making: (i) a public disclosure regarding this Memorandum of
      Understanding, the creation of a strategic alliance between
      the parties, and/or the publication of test results if, in
      the opinion  of it's legal counsel, such disclosure is
      required by law; and (ii) reasonable and customary
      disclosures without Photon-X's approval to select capital
      sources as may be necessary in connection with obtaining any
      financing which may be sought in connection with TDON's
      business.

      Further Photon-X acknowledges that during the period of
      it's Memorandum of Understanding and the terms of the
      strategic alliance contemplated herein, Photon-X, and
      personnel at Photon-X, may become aware of "material
      non-public information"  (as defined under applicable
      securities laws) regarding TDON.  Photon-X understands,
      and it will communicate to persons having knowledge of
      any such information, that they are required under
      applicable securities of TDON while in possession of
      this information and to refrain from disclosing this
      information to anyone accept as required pursuant to
      this Memorandum of Understanding and the terms of the
      strategic alliance contemplated herein.

                          Section 3
                           General

3.1   Expenses.  Each party shall pay it's own expenses
      (including but not limited to legal, accounting and other
      professional services) in connection with all negotiations
      and activities relating to this Memorandum of Understanding.


3.2   Termination.  Each party has the right to terminate
      this Memorandum of Understanding at any time with or without
      cause.  This Memorandum of Understanding shall automatically
      terminate if no strategic alliance is created by the parties
      by August 31, 2008.  Following termination, neither party
      shall have any obligations under this Memorandum of
      Understanding, other than is set forth in section 2 herein.


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3.3   Exclusive understanding.  Both parties agree that this
      Memorandum of Understanding is the complete and exclusive
      statement  of understanding between the parties and
      supersedes all prior agreements, whether oral or written,
      with respect to the subject matter hereof.


3.4   Non-Exclusive Agreement.  This Memorandum of
      Understanding shall not limit the scope of either party's
      business operations, or prevent either of the parties from
      entering into any other agreement with any third party with
      respect to any matter.


3.5   Binding Effect.  This Memorandum of Understanding is
      intended to be a  confirmation of interest between the
      parties in pursuing negotiations for a strategic alliance
      based on the terms hereof, and, other than as set forth in
      Section 2 herein, shall not constitute a binding agreement
      between the parties hereto.  Neither party intends, in
      setting forth in this Memorandum of Understanding, the
      provisions of a possible strategic alliance, to create, for
      itself or any other person, any legally binding obligation
      of liability.  No agreement shall be binding, unless and
      until each party has reviewed and approved (in it's sole
      discretion) a definitive written agreement incorporating all
      the terms, conditions and obligations of the parties, has
      had such agreement reviewed by legal counsel, and has duly
      executed and delivered such agreement.  The legal rights and
      obligations of each party shall be only those that are set
      forth in the definitive written agreement.


3.6   Counterparts.  This Memorandum of Understanding may be
      executed in any number of counterparts; each of which when
      so executed and delivered shall be deemed an original, and
      such counterparts together shall constitute only one
      original.

IN WITNESS THEREOF, THE PARTIES HAVE ENTERED INTO THIS
Memorandum of Understanding as of December 7, 2006.
                                  ----------------


THIRD-ORDER NANOTECHNOLOGIES, INC.         PHOTON-X, LLC

By:/s/ Frederick Goetz                     By:/s/ Yongming Cai
   -------------------------------            -----------------
   Frederick Goetz, Jr., President            Yongming Cai, CEO



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