Document:

WARRANT

THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IN A FORM REASONABLY
SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID
ACT. NOTWITHSTANDING THE FOREGOING, THIS WARRANT MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT.

                             LASER ENERGETICS, INC.

                        Warrant To Purchase Common Stock

Warrant No.: CCP-001                                 Number of Shares: 3,000,000

Date of Issuance: February 13, 2006

Laser Energetics, Inc., (f/k/a Happy Food Corporation) an Oklahoma corporation
(the "Company"), hereby certifies that, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Cornell Capital
Partners, LP ("Cornell"), the registered holder hereof or its permitted assigns,
is entitled, subject to the terms set forth below, to purchase from the Company
upon surrender of this Warrant, at any time or times on or after the date
hereof, but not after 11:59 P.M. Eastern Time on the Expiration Date (as defined
herein) Three Million (3,000,000) fully paid and nonassessable shares of Common
Stock (as defined herein) of the Company (the "Warrant Shares") at the exercise
price per share provided in Section 1(b) below or as subsequently adjusted;
provided, however, that in no event shall the holder be entitled to exercise
this Warrant for a number of Warrant Shares in excess of that number of Warrant
Shares which, upon giving effect to such exercise, would cause the aggregate
number of shares of Common Stock beneficially owned by the holder and its
affiliates to exceed 4.99% of the outstanding shares of the Common Stock
following such exercise, except within sixty (60) days of the Expiration Date
(however, such restriction may be waived by Cornell (but only as to itself and
not to any other holder) upon not less than 65 days prior notice to the Company
and any other holders shall be unaffected by any such waiver). For purposes of
the foregoing proviso, the aggregate number of shares of Common Stock
beneficially owned by the holder and its affiliates shall include the number of
shares of Common Stock issuable upon exercise of this Warrant with respect to
which the determination of such proviso is being made, but shall exclude shares
of Common Stock which would be issuable upon (i) exercise of the remaining,
unexercised Warrants beneficially owned by the holder and its affiliates and
(ii) exercise or conversion of the unexercised or unconverted portion of any

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other securities of the Company beneficially owned by the holder and its
affiliates (including, without limitation, any convertible notes or preferred
stock) subject to a limitation on conversion or exercise analogous to the
limitation contained herein. Except as set forth in the preceding sentence, for
purposes of this paragraph, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended. For purposes of this Warrant, in determining the number of outstanding
shares of Common Stock a holder may rely on the number of outstanding shares of
Common Stock as reflected in (1) the Company's most recent Form 10-QSB or Form
10-KSB, as the case may be, (2) a more recent public announcement by the Company
or (3) any other notice by the Company or its transfer agent setting forth the
number of shares of Common Stock outstanding. Upon the written request of any
holder, the Company shall promptly, but in no event later than one (1) Business
Day following the receipt of such notice, confirm in writing to any such holder
the number of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to
the exercise of Warrants (as defined below) by such holder and its affiliates
since the date as of which such number of outstanding shares of Common Stock was
reported.

      Section 1.

            (a) This Warrant is the common stock purchase warrant (the
"Warrant") issued pursuant to the Amended and Restated Securities Purchase
Agreement ("Securities Purchase Agreement") dated the date hereof between the
Company and the Buyers listed on Schedule I thereto.

            (b) Definitions. The following words and terms as used in this
Warrant shall have the following meanings:

                  (i) "Approved Stock Plan" means any employee benefit plan
which has been approved by the Board of Directors of the Company, pursuant to
which the Company's securities may be issued to any employee, officer or
director for services provided to the Company.

                  (ii) "Business Day" means any day other than Saturday, Sunday
or other day on which commercial banks in the City of New York are authorized or
required by law to remain closed.

                  (iii) "Closing Bid Price" means the closing bid price of
Common Stock as quoted on the Principal Market (as reported by Bloomberg
Financial Markets ("Bloomberg") through its "Volume at Price" function).

                  (iv) "Common Stock" means (i) the Company's common stock, par
value $0.001 per share, and (ii) any capital stock into which such Common Stock
shall have been changed or any capital stock resulting from a reclassification
of such Common Stock.

                  (v) "Event of Default" means an event of default under the
Sceurities Purchase Agreement or the Convertible Debentures issued in connection
therewith.

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                  (vi) "Excluded Securities" means, provided such security is
issued at a price which is greater than or equal to the arithmetic average of
the Closing Bid Prices of the Common Stock for the ten (10) consecutive trading
days immediately preceding the date of issuance, any of the following: (a) any
issuance by the Company of securities in connection with a strategic partnership
or a joint venture (the primary purpose of which is not to raise equity
capital), (b) any issuance by the Company of securities as consideration for a
merger or consolidation or the acquisition of a business, product, license, or
other assets of another person or entity and (c) options to purchase shares of
Common Stock, provided (I) such options are issued after the date of this
Warrant to employees of the Company within thirty (30) days of such employee's
starting his employment with the Company, and (II) the exercise price of such
options is not less than the Closing Bid Price of the Common Stock on the date
of issuance of such option.

                  (vii) "Expiration Date" means the date three (3) years from
the Issuance Date of this Warrant or, if such date falls on a Saturday, Sunday
or other day on which banks are required or authorized to be closed in the City
of New York or the State of New York or on which trading does not take place on
the Principal Exchange or automated quotation system on which the Common Stock
is traded (a "Holiday"), the next date that is not a Holiday.

                  (viii) "Issuance Date" means the date hereof.

                  (ix) "Options" means any rights, warrants or options to
subscribe for or purchase Common Stock or Convertible Securities.

                  (x) "Other Securities" means (i) those options and warrants of
the Company issued prior to, and outstanding on, the Issuance Date of this
Warrant, (ii) the shares of Common Stock issuable on exercise of such options
and warrants, provided such options and warrants are not amended after the
Issuance Date of this Warrant and (iii) the shares of Common Stock issuable upon
exercise of this Warrant.

                  (xi) "Person" means an individual, a limited liability
company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency
thereof.

                  (xii) "Principal Market" means the New York Stock Exchange,
the American Stock Exchange, the Nasdaq National Market, the Nasdaq SmallCap
Market, whichever is at the time the principal trading exchange or market for
such security, or the over-the-counter market on the electronic bulletin board
for such security as reported by Bloomberg or, if no bid or sale information is
reported for such security by Bloomberg, then the average of the bid prices of
each of the market makers for such security as reported in the "pink sheets" by
the National Quotation Bureau, Inc.

                  (xiii) "Securities Act" means the Securities Act of 1933, as
amended.

                  (xiv) "Warrant" means this Warrant and all Warrants issued in
exchange, transfer or replacement thereof.

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                  (xv) "Warrant Exercise Price" shall be $0.001 or as
subsequently adjusted as provided in Section 8 hereof.

                  (xvi) "Warrant Shares" means the shares of Common Stock
issuable at any time upon exercise of this Warrant.

            (c) Other Definitional Provisions.

                  (i) Except as otherwise specified herein, all references
herein (A) to the Company shall be deemed to include the Company's successors
and (B) to any applicable law defined or referred to herein shall be deemed
references to such applicable law as the same may have been or may be amended or
supplemented from time to time.

                  (ii) When used in this Warrant, the words "herein", "hereof",
and "hereunder" and words of similar import, shall refer to this Warrant as a
whole and not to any provision of this Warrant, and the words "Section",
"Schedule", and "Exhibit" shall refer to Sections of, and Schedules and Exhibits
to, this Warrant unless otherwise specified.

                  (iii) Whenever the context so requires, the neuter gender
includes the masculine or feminine, and the singular number includes the plural,
and vice versa.

      Section 2. Exercise of Warrant.

            (a) Subject to the terms and conditions hereof, this Warrant may be
exercised by the holder hereof then registered on the books of the Company, pro
rata as hereinafter provided, at any time on any Business Day on or after the
opening of business on such Business Day, commencing with the first day after
the date hereof, and prior to 11:59 P.M. Eastern Time on the Expiration Date (i)
by delivery of a written notice, in the form of the subscription notice attached
as Exhibit A hereto (the "Exercise Notice"), of such holder's election to
exercise this Warrant, which notice shall specify the number of Warrant Shares
to be purchased, payment to the Company of an amount equal to the Warrant
Exercise Price(s) applicable to the Warrant Shares being purchased, multiplied
by the number of Warrant Shares (at the applicable Warrant Exercise Price) as to
which this Warrant is being exercised (plus any applicable issue or transfer
taxes) (the "Aggregate Exercise Price") in cash or wire transfer of immediately
available funds and the surrender of this Warrant (or an indemnification
undertaking with respect to this Warrant in the case of its loss, theft or
destruction) to a common carrier for overnight delivery to the Company as soon
as practicable following such date ("Cash Basis") or (ii) if at the time of
exercise, the Warrant Shares are not subject to an effective registration
statement or if an Event of Default has occurred, by delivering an Exercise
Notice and in lieu of making payment of the Aggregate Exercise Price in cash or
wire transfer, elect instead to receive upon such exercise the "Net Number" of
shares of Common Stock determined according to the following formula (the
"Cashless Exercise"):

      Net Number = (A x B) - (A x C)
                   -----------------
                           B

            For purposes of the foregoing formula:

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            A = the total number of Warrant Shares with respect to which this
            Warrant is then being exercised.

            B = the Closing Bid Price of the Common Stock on the date of
            exercise of the Warrant.

            C = the Warrant Exercise Price then in effect for the applicable
            Warrant Shares at the time of such exercise.

      In the event of any exercise of the rights represented by this Warrant in
compliance with this Section 2, the Company shall on or before the fifth (5th)
Business Day following the date of receipt of the Exercise Notice, the Aggregate
Exercise Price and this Warrant (or an indemnification undertaking with respect
to this Warrant in the case of its loss, theft or destruction) and the receipt
of the representations of the holder specified in Section 6 hereof, if requested
by the Company (the "Exercise Delivery Documents"), and if the Common Stock is
DTC eligible, credit such aggregate number of shares of Common Stock to which
the holder shall be entitled to the holder's or its designee's balance account
with The Depository Trust Company; provided, however, if the holder who
submitted the Exercise Notice requested physical delivery of any or all of the
Warrant Shares, or, if the Common Stock is not DTC eligible then the Company
shall, on or before the fifth (5th) Business Day following receipt of the
Exercise Delivery Documents, issue and surrender to a common carrier for
overnight delivery to the address specified in the Exercise Notice, a
certificate, registered in the name of the holder, for the number of shares of
Common Stock to which the holder shall be entitled pursuant to such request.
Upon delivery of the Exercise Notice and Aggregate Exercise Price referred to in
clause (i) or (ii) above the holder of this Warrant shall be deemed for all
corporate purposes to have become the holder of record of the Warrant Shares
with respect to which this Warrant has been exercised. In the case of a dispute
as to the determination of the Warrant Exercise Price, the Closing Bid Price or
the arithmetic calculation of the Warrant Shares, the Company shall promptly
issue to the holder the number of Warrant Shares that is not disputed and shall
submit the disputed determinations or arithmetic calculations to the holder via
facsimile within one (1) Business Day of receipt of the holder's Exercise
Notice.

            (b) If the holder and the Company are unable to agree upon the
determination of the Warrant Exercise Price or arithmetic calculation of the
Warrant Shares within one (1) day of such disputed determination or arithmetic
calculation being submitted to the holder, then the Company shall immediately
submit via facsimile (i) the disputed determination of the Warrant Exercise
Price or the Closing Bid Price to an independent, reputable investment banking
firm or (ii) the disputed arithmetic calculation of the Warrant Shares to its
independent, outside accountant. The Company shall cause the investment banking
firm or the accountant, as the case may be, to perform the determinations or
calculations and notify the Company and the holder of the results no later than
forty-eight (48) hours from the time it receives the disputed determinations or
calculations. Such investment banking firm's or accountant's determination or
calculation, as the case may be, shall be deemed conclusive absent manifest
error.

            (c) Unless the rights represented by this Warrant shall have expired
or shall have been fully exercised, the Company shall, as soon as practicable
and in no event later than five (5) Business Days after any exercise and at its

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own expense, issue a new Warrant identical in all respects to this Warrant
exercised except it shall represent rights to purchase the number of Warrant
Shares purchasable immediately prior to such exercise under this Warrant
exercised, less the number of Warrant Shares with respect to which such Warrant
is exercised.

            (d) No fractional Warrant Shares are to be issued upon any pro rata
exercise of this Warrant, but rather the number of Warrant Shares issued upon
such exercise of this Warrant shall be rounded up or down to the nearest whole
number.

            (e) If the Company or its Transfer Agent shall fail for any reason
or for no reason to issue to the holder within ten (10) days of receipt of the
Exercise Delivery Documents, a certificate for the number of Warrant Shares to
which the holder is entitled or to credit the holder's balance account with The
Depository Trust Company for such number of Warrant Shares to which the holder
is entitled upon the holder's exercise of this Warrant, the Company shall, in
addition to any other remedies under this Warrant or the Placement Agent
Agreement or otherwise available to such holder, pay as additional damages in
cash to such holder on each day the issuance of such certificate for Warrant
Shares is not timely effected an amount equal to 0.025% of the product of (A)
the sum of the number of Warrant Shares not issued to the holder on a timely
basis and to which the holder is entitled, and (B) the Closing Bid Price of the
Common Stock for the trading day immediately preceding the last possible date
which the Company could have issued such Common Stock to the holder without
violating this Section 2.

            (f) If within ten (10) days after the Company's receipt of the
Exercise Delivery Documents, the Company fails to deliver a new Warrant to the
holder for the number of Warrant Shares to which such holder is entitled
pursuant to Section 2 hereof, then, in addition to any other available remedies
under this Warrant or the Placement Agent Agreement, or otherwise available to
such holder, the Company shall pay as additional damages in cash to such holder
on each day after such tenth (10th) day that such delivery of such new Warrant
is not timely effected in an amount equal to 0.25% of the product of (A) the
number of Warrant Shares represented by the portion of this Warrant which is not
being exercised and (B) the Closing Bid Price of the Common Stock for the
trading day immediately preceding the last possible date which the Company could
have issued such Warrant to the holder without violating this Section 2.

      Section 3. Covenants as to Common Stock. The Company hereby covenants and
agrees as follows:

            (a) This Warrant is, and any Warrants issued in substitution for or
replacement of this Warrant will upon issuance be, duly authorized and validly
issued.

            (b) All Warrant Shares which may be issued upon the exercise of the
rights represented by this Warrant will, upon issuance, be validly issued, fully
paid and nonassessable and free from all taxes, liens and charges with respect
to the issue thereof.

            (c) During the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized and
reserved at least one hundred percent (100%) of the number of shares of Common
Stock needed to provide for the exercise of the rights then represented by this
Warrant and the par value of said shares will at all times be less than or equal
to the applicable Warrant Exercise Price. If at any time the Company does not

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have a sufficient number of shares of Common Stock authorized and available,
then the Company shall call and hold a special meeting of its stockholders
within sixty (60) days of that time for the sole purpose of increasing the
number of authorized shares of Common Stock.

            (d) If at any time after the date hereof the Company shall file a
registration statement, the Company shall include the Warrant Shares issuable to
the holder, pursuant to the terms of this Warrant and shall maintain, so long as
any other shares of Common Stock shall be so listed, such listing of all Warrant
Shares from time to time issuable upon the exercise of this Warrant; and the
Company shall so list on each national securities exchange or automated
quotation system, as the case may be, and shall maintain such listing of, any
other shares of capital stock of the Company issuable upon the exercise of this
Warrant if and so long as any shares of the same class shall be listed on such
national securities exchange or automated quotation system.

            (e) The Company will not, by amendment of its Articles of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities, or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all such action as may reasonably be requested by the holder of this
Warrant in order to protect the exercise privilege of the holder of this Warrant
against dilution or other impairment, consistent with the tenor and purpose of
this Warrant. The Company will not increase the par value of any shares of
Common Stock receivable upon the exercise of this Warrant above the Warrant
Exercise Price then in effect, and (ii) will take all such actions as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant.

            (f) This Warrant will be binding upon any entity succeeding to the
Company by merger, consolidation or acquisition of all or substantially all of
the Company's assets.

      Section 4. Taxes. The Company shall pay any and all taxes, except any
applicable withholding, which may be payable with respect to the issuance and
delivery of Warrant Shares upon exercise of this Warrant.

      Section 5. Warrant Holder Not Deemed a Stockholder. Except as otherwise
specifically provided herein, no holder, as such, of this Warrant shall be
entitled to vote or receive dividends or be deemed the holder of shares of
capital stock of the Company for any purpose, nor shall anything contained in
this Warrant be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote, give or withhold
consent to any corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, conveyance or otherwise),
receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the holder of this Warrant of the Warrant
Shares which he or she is then entitled to receive upon the due exercise of this
Warrant. In addition, nothing contained in this Warrant shall be construed as
imposing any liabilities on such holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a stockholder of the Company,
whether such liabilities are asserted by the Company or by creditors of the
Company. Notwithstanding this Section 5, the Company will provide the holder of

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this Warrant with copies of the same notices and other information given to the
stockholders of the Company generally, contemporaneously with the giving thereof
to the stockholders.

      Section 6. Representations of Holder. The holder of this Warrant, by the
acceptance hereof, represents that it is acquiring this Warrant and the Warrant
Shares for its own account for investment only and not with a view towards, or
for resale in connection with, the public sale or distribution of this Warrant
or the Warrant Shares, except pursuant to sales registered or exempted under the
Securities Act; provided, however, that by making the representations herein,
the holder does not agree to hold this Warrant or any of the Warrant Shares for
any minimum or other specific term and reserves the right to dispose of this
Warrant and the Warrant Shares at any time in accordance with or pursuant to a
registration statement or an exemption under the Securities Act. The holder of
this Warrant further represents, by acceptance hereof, that, as of this date,
such holder is an "accredited investor" as such term is defined in Rule
501(a)(1) of Regulation D promulgated by the Securities and Exchange Commission
under the Securities Act (an "Accredited Investor"). Upon exercise of this
Warrant the holder shall, if requested by the Company, confirm in writing, in a
form satisfactory to the Company, that the Warrant Shares so purchased are being
acquired solely for the holder's own account and not as a nominee for any other
party, for investment, and not with a view toward distribution or resale and
that such holder is an Accredited Investor. If such holder cannot make such
representations because they would be factually incorrect, it shall be a
condition to such holder's exercise of this Warrant that the Company receive
such other representations as the Company considers reasonably necessary to
assure the Company that the issuance of its securities upon exercise of this
Warrant shall not violate any United States or state securities laws.

      Section 7. Ownership and Transfer.

            (a) The Company shall maintain at its principal executive offices
(or such other office or agency of the Company as it may designate by notice to
the holder hereof), a register for this Warrant, in which the Company shall
record the name and address of the person in whose name this Warrant has been
issued, as well as the name and address of each transferee. The Company may
treat the person in whose name any Warrant is registered on the register as the
owner and holder thereof for all purposes, notwithstanding any notice to the
contrary, but in all events recognizing any transfers made in accordance with
the terms of this Warrant.

      Section 8. Adjustment of Warrant Exercise Price and Number of Shares. The
Warrant Exercise Price and the number of shares of Common Stock issuable upon
exercise of this Warrant shall be adjusted from time to time as follows:

            (a) Adjustment of Warrant Exercise Price and Number of Shares upon
Issuance of Common Stock. If and whenever on or after the Issuance Date of this
Warrant, the Company issues or sells, or is deemed to have issued or sold, any
shares of Common Stock (other than (i) Excluded Securities and (ii) shares of
Common Stock which are issued or deemed to have been issued by the Company in
connection with an Approved Stock Plan or upon exercise or conversion of the
Other Securities) for a consideration per share less than a price (the
"Applicable Price") equal to the Warrant Exercise Price in effect immediately
prior to such issuance or sale, then immediately after such issue or sale the
Warrant Exercise Price then in effect shall be reduced to an amount equal to

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such consideration per share. Upon each such adjustment of the Warrant Exercise
Price hereunder, the number of Warrant Shares issuable upon exercise of this
Warrant shall be adjusted to the number of shares determined by multiplying the
Warrant Exercise Price in effect immediately prior to such adjustment by the
number of Warrant Shares issuable upon exercise of this Warrant immediately
prior to such adjustment and dividing the product thereof by the Warrant
Exercise Price resulting from such adjustment.

            (b) Effect on Warrant Exercise Price of Certain Events. For purposes
of determining the adjusted Warrant Exercise Price under Section 8(a) above, the
following shall be applicable:

                  (i) Issuance of Options. If after the date hereof, the Company
in any manner grants any Options and the lowest price per share for which one
share of Common Stock is issuable upon the exercise of any such Option or upon
conversion or exchange of any convertible securities issuable upon exercise of
any such Option is less than the Applicable Price, then such share of Common
Stock shall be deemed to be outstanding and to have been issued and sold by the
Company at the time of the granting or sale of such Option for such price per
share. For purposes of this Section 8(b)(i), the lowest price per share for
which one share of Common Stock is issuable upon exercise of such Options or
upon conversion or exchange of such Convertible Securities shall be equal to the
sum of the lowest amounts of consideration (if any) received or receivable by
the Company with respect to any one share of Common Stock upon the granting or
sale of the Option, upon exercise of the Option or upon conversion or exchange
of any convertible security issuable upon exercise of such Option. No further
adjustment of the Warrant Exercise Price shall be made upon the actual issuance
of such Common Stock or of such convertible securities upon the exercise of such
Options or upon the actual issuance of such Common Stock upon conversion or
exchange of such convertible securities.

                  (ii) Issuance of Convertible Securities. If the Company in any
manner issues or sells any convertible securities and the lowest price per share
for which one share of Common Stock is issuable upon the conversion or exchange
thereof is less than the Applicable Price, then such share of Common Stock shall
be deemed to be outstanding and to have been issued and sold by the Company at
the time of the issuance or sale of such convertible securities for such price
per share. For the purposes of this Section 8(b)(ii), the lowest price per share
for which one share of Common Stock is issuable upon such conversion or exchange
shall be equal to the sum of the lowest amounts of consideration (if any)
received or receivable by the Company with respect to one share of Common Stock
upon the issuance or sale of the convertible security and upon conversion or
exchange of such convertible security. No further adjustment of the Warrant
Exercise Price shall be made upon the actual issuance of such Common Stock upon
conversion or exchange of such convertible securities, and if any such issue or
sale of such convertible securities is made upon exercise of any Options for
which adjustment of the Warrant Exercise Price had been or are to be made
pursuant to other provisions of this Section 8(b), no further adjustment of the
Warrant Exercise Price shall be made by reason of such issue or sale.

                  (iii) Change in Option Price or Rate of Conversion. If the
purchase price provided for in any Options, the additional consideration, if

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any, payable upon the issue, conversion or exchange of any convertible
securities, or the rate at which any convertible securities are convertible into
or exchangeable for Common Stock changes at any time, the Warrant Exercise Price
in effect at the time of such change shall be adjusted to the Warrant Exercise
Price which would have been in effect at such time had such Options or
convertible securities provided for such changed purchase price, additional
consideration or changed conversion rate, as the case may be, at the time
initially granted, issued or sold and the number of Warrant Shares issuable upon
exercise of this Warrant shall be correspondingly readjusted. For purposes of
this Section 8(b)(iii), if the terms of any Option or convertible security that
was outstanding as of the Issuance Date of this Warrant are changed in the
manner described in the immediately preceding sentence, then such Option or
convertible security and the Common Stock deemed issuable upon exercise,
conversion or exchange thereof shall be deemed to have been issued as of the
date of such change. No adjustment pursuant to this Section 8(b) shall be made
if such adjustment would result in an increase of the Warrant Exercise Price
then in effect.

            (c) Effect on Warrant Exercise Price of Certain Events. For purposes
of determining the adjusted Warrant Exercise Price under Sections 8(a) and 8(b),
the following shall be applicable:

                  (i) Calculation of Consideration Received. If any Common
Stock, Options or convertible securities are issued or sold or deemed to have
been issued or sold for cash, the consideration received therefore will be
deemed to be the net amount received by the Company therefore. If any Common
Stock, Options or convertible securities are issued or sold for a consideration
other than cash, the amount of such consideration received by the Company will
be the fair value of such consideration, except where such consideration
consists of marketable securities, in which case the amount of consideration
received by the Company will be the market price of such securities on the date
of receipt of such securities. If any Common Stock, Options or convertible
securities are issued to the owners of the non-surviving entity in connection
with any merger in which the Company is the surviving entity, the amount of
consideration therefore will be deemed to be the fair value of such portion of
the net assets and business of the non-surviving entity as is attributable to
such Common Stock, Options or convertible securities, as the case may be. The
fair value of any consideration other than cash or securities will be determined
jointly by the Company and the holders of Warrants representing at least
two-thirds (b) of the Warrant Shares issuable upon exercise of the Warrants then
outstanding. If such parties are unable to reach agreement within ten (10) days
after the occurrence of an event requiring valuation (the "Valuation Event"),
the fair value of such consideration will be determined within five (5) Business
Days after the tenth (10th) day following the Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the holders of Warrants
representing at least two-thirds (b) of the Warrant Shares issuable upon
exercise of the Warrants then outstanding. The determination of such appraiser
shall be final and binding upon all parties and the fees and expenses of such
appraiser shall be borne jointly by the Company and the holders of Warrants.

                  (ii) Integrated Transactions. In case any Option is issued in
connection with the issue or sale of other securities of the Company, together
comprising one integrated transaction in which no specific consideration is
allocated to such Options by the parties thereto, the Options will be deemed to
have been issued for a consideration of $.01.

                                      A-10
<PAGE>

                  (iii) Treasury Shares. The number of shares of Common Stock
outstanding at any given time does not include shares owned or held by or for
the account of the Company, and the disposition of any shares so owned or held
will be considered an issue or sale of Common Stock.

                  (iv) Record Date. If the Company takes a record of the holders
of Common Stock for the purpose of entitling them (1) to receive a dividend or
other distribution payable in Common Stock, Options or in convertible securities
or (2) to subscribe for or purchase Common Stock, Options or convertible
securities, then such record date will be deemed to be the date of the issue or
sale of the shares of Common Stock deemed to have been issued or sold upon the
declaration of such dividend or the making of such other distribution or the
date of the granting of such right of subscription or purchase, as the case may
be.

            (d) Adjustment of Warrant Exercise Price upon Subdivision or
Combination of Common Stock. If the Company at any time after the date of
issuance of this Warrant subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, any Warrant Exercise Price in
effect immediately prior to such subdivision will be proportionately reduced and
the number of shares of Common Stock obtainable upon exercise of this Warrant
will be proportionately increased. If the Company at any time after the date of
issuance of this Warrant combines (by combination, reverse stock split or
otherwise) one or more classes of its outstanding shares of Common Stock into a
smaller number of shares, any Warrant Exercise Price in effect immediately prior
to such combination will be proportionately increased and the number of Warrant
Shares issuable upon exercise of this Warrant will be proportionately decreased.
Any adjustment under this Section 8(d) shall become effective at the close of
business on the date the subdivision or combination becomes effective.

            (e) Distribution of Assets. If the Company shall declare or make any
dividend or other distribution of its assets (or rights to acquire its assets)
to holders of Common Stock, by way of return of capital or otherwise (including,
without limitation, any distribution of cash, stock or other securities,
property or options by way of a dividend, spin off, reclassification, corporate
rearrangement or other similar transaction) (a "Distribution"), at any time
after the issuance of this Warrant, then, in each such case:

                  (i) any Warrant Exercise Price in effect immediately prior to
the close of business on the record date fixed for the determination of holders
of Common Stock entitled to receive the Distribution shall be reduced, effective
as of the close of business on such record date, to a price determined by
multiplying such Warrant Exercise Price by a fraction of which (A) the numerator
shall be the Closing Sale Price of the Common Stock on the trading day
immediately preceding such record date minus the value of the Distribution (as
determined in good faith by the Company's Board of Directors) applicable to one
share of Common Stock, and (B) the denominator shall be the Closing Sale Price
of the Common Stock on the trading day immediately preceding such record date;
and

                  (ii) either (A) the number of Warrant Shares obtainable upon
exercise of this Warrant shall be increased to a number of shares equal to the
number of shares of Common Stock obtainable immediately prior to the close of
business on the record date fixed for the determination of holders of Common

                                      A-11
<PAGE>

Stock entitled to receive the Distribution multiplied by the reciprocal of the
fraction set forth in the immediately preceding clause (i), or (B) in the event
that the Distribution is of common stock of a company whose common stock is
traded on a national securities exchange or a national automated quotation
system, then the holder of this Warrant shall receive an additional warrant to
purchase Common Stock, the terms of which shall be identical to those of this
Warrant, except that such warrant shall be exercisable into the amount of the
assets that would have been payable to the holder of this Warrant pursuant to
the Distribution had the holder exercised this Warrant immediately prior to such
record date and with an exercise price equal to the amount by which the exercise
price of this Warrant was decreased with respect to the Distribution pursuant to
the terms of the immediately preceding clause (i).

            (f) Certain Events. If any event occurs of the type contemplated by
the provisions of this Section 8 but not expressly provided for by such
provisions (including, without limitation, the granting of stock appreciation
rights, phantom stock rights or other rights with equity features), then the
Company's Board of Directors will make an appropriate adjustment in the Warrant
Exercise Price and the number of shares of Common Stock obtainable upon exercise
of this Warrant so as to protect the rights of the holders of the Warrants;
provided, except as set forth in section 8(d),that no such adjustment pursuant
to this Section 8(f) will increase the Warrant Exercise Price or decrease the
number of shares of Common Stock obtainable as otherwise determined pursuant to
this Section 8.

            (g) Notices.

                  (i) Immediately upon any adjustment of the Warrant Exercise
Price, the Company will give written notice thereof to the holder of this
Warrant, setting forth in reasonable detail, and certifying, the calculation of
such adjustment.

                  (ii) The Company will give written notice to the holder of
this Warrant at least ten (10) days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend or
distribution upon the Common Stock, (B) with respect to any pro rata
subscription offer to holders of Common Stock or (C) for determining rights to
vote with respect to any Organic Change (as defined below), dissolution or
liquidation, provided that such information shall be made known to the public
prior to or in conjunction with such notice being provided to such holder.

                  (iii) The Company will also give written notice to the holder
of this Warrant at least ten (10) days prior to the date on which any Organic
Change, dissolution or liquidation will take place, provided that such
information shall be made known to the public prior to or in conjunction with
such notice being provided to such holder.

      Section 9. Purchase Rights; Reorganization, Reclassification,
Consolidation, Merger or Sale.

            (a) In addition to any adjustments pursuant to Section 8 above, if
at any time the Company grants, issues or sells any Options, Convertible
Securities or rights to purchase stock, warrants, securities or other property
pro rata to the record holders of any class of Common Stock (the "Purchase

                                      A-12
<PAGE>

Rights"), then the holder of this Warrant will be entitled to acquire, upon the
terms applicable to such Purchase Rights, the aggregate Purchase Rights which
such holder could have acquired if such holder had held the number of shares of
Common Stock acquirable upon complete exercise of this Warrant immediately
before the date on which a record is taken for the grant, issuance or sale of
such Purchase Rights, or, if no such record is taken, the date as of which the
record holders of Common Stock are to be determined for the grant, issue or sale
of such Purchase Rights.

            (b) Any recapitalization, reorganization, reclassification,
consolidation, merger, sale of all or substantially all of the Company's assets
to another Person or other transaction in each case which is effected in such a
way that holders of Common Stock are entitled to receive (either directly or
upon subsequent liquidation) stock, securities or assets with respect to or in
exchange for Common Stock is referred to herein as an "Organic Change." Prior to
the consummation of any (i) sale of all or substantially all of the Company's
assets to an acquiring Person or (ii) other Organic Change following which the
Company is not a surviving entity, the Company will secure from the Person
purchasing such assets or the successor resulting from such Organic Change (in
each case, the "Acquiring Entity") a written agreement (in form and substance
satisfactory to the holders of Warrants representing at least two-thirds (iii)
of the Warrant Shares issuable upon exercise of the Warrants then outstanding)
to deliver to each holder of Warrants in exchange for such Warrants, a security
of the Acquiring Entity evidenced by a written instrument substantially similar
in form and substance to this Warrant and satisfactory to the holders of the
Warrants (including an adjusted warrant exercise price equal to the value for
the Common Stock reflected by the terms of such consolidation, merger or sale,
and exercisable for a corresponding number of shares of Common Stock acquirable
and receivable upon exercise of the Warrants without regard to any limitations
on exercise, if the value so reflected is less than any Applicable Warrant
Exercise Price immediately prior to such consolidation, merger or sale). Prior
to the consummation of any other Organic Change, the Company shall make
appropriate provision (in form and substance satisfactory to the holders of
Warrants representing a majority of the Warrant Shares issuable upon exercise of
the Warrants then outstanding) to insure that each of the holders of the
Warrants will thereafter have the right to acquire and receive in lieu of or in
addition to (as the case may be) the Warrant Shares immediately theretofore
issuable and receivable upon the exercise of such holder's Warrants (without
regard to any limitations on exercise), such shares of stock, securities or
assets that would have been issued or payable in such Organic Change with
respect to or in exchange for the number of Warrant Shares which would have been
issuable and receivable upon the exercise of such holder's Warrant as of the
date of such Organic Change (without taking into account any limitations or
restrictions on the exercisability of this Warrant).

      Section 10. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant
is lost, stolen, mutilated or destroyed, the Company shall promptly, on receipt
of an indemnification undertaking (or, in the case of a mutilated Warrant, the
Warrant), issue a new Warrant of like denomination and tenor as this Warrant so
lost, stolen, mutilated or destroyed.

      Section 11. Notice. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Warrant must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of receipt is received by the sending party transmission is

                                      A-13
<PAGE>

mechanically or electronically generated and kept on file by the sending party);
or (iii) one Business Day after deposit with a nationally recognized overnight
delivery service, in each case properly addressed to the party to receive the
same. The addresses and facsimile numbers for such communications shall be:

If to Cornell:                      Cornell Capital Partners, LP
                                    101 Hudson Street - Suite 3700
                                    Jersey City, NJ 07302
                                    Attention: Mark A. Angelo
                                    Telephone: (201) 985-8300
                                    Facsimile: (201) 985-8266

With Copy to:                       Troy Rillo, Esq.
                                    101 Hudson Street - Suite 3700
                                    Jersey City, NJ 07302
                                    Telephone: (201) 985-8300
                                    Facsimile: (201) 985-8266

If to the Company, to:              Laser Energetics, Inc.
                                    3535 Quakerbridge Road - Suite 700
                                    Mercerville, NJ 08619
                                    Attention: Robert D. Battis
                                    Telephone: (609) 587-8250
                                    Facsimile: (609) 587-9315

With a copy to:                     Stark & Stark PC
                                    PO Box 5315
                                    Princeton, NJ 08543
                                    Attention: Rachel L. Stark, Esq.
                                    Telephone: (609) 895-7348
                                    Facsimile: (609) 895-7395

If to a holder of this Warrant, to it at the address and facsimile number set
forth on Exhibit C hereto, with copies to such holder's representatives as set
forth on Exhibit C, or at such other address and facsimile as shall be delivered
to the Company upon the issuance or transfer of this Warrant. Each party shall
provide five days' prior written notice to the other party of any change in
address or facsimile number. Written confirmation of receipt (A) given by the
recipient of such notice, consent, facsimile, waiver or other communication, (or
(B) provided by a nationally recognized overnight delivery service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from a
nationally recognized overnight delivery service in accordance with clause (i),
(ii) or (iii) above, respectively.

      Section 12. Date. The date of this Warrant is set forth on page 1 hereof.
This Warrant, in all events, shall be wholly void and of no effect after the
close of business on the Expiration Date, except that notwithstanding any other
provisions hereof, the provisions of Section 8(b) shall continue in full force
and effect after such date as to any Warrant Shares or other securities issued
upon the exercise of this Warrant.

                                      A-14
<PAGE>

      Section 13. Amendment and Waiver. Except as otherwise provided herein, the
provisions of the Warrants may be amended and the Company may take any action
herein prohibited, or omit to perform any act herein required to be performed by
it, only if the Company has obtained the written consent of the holders of
Warrants representing at least two-thirds of the Warrant Shares issuable upon
exercise of the Warrants then outstanding; provided that, except for Section
8(d), no such action may increase the Warrant Exercise Price or decrease the
number of shares or class of stock obtainable upon exercise of any Warrant
without the written consent of the holder of such Warrant.

      Section 14. Descriptive Headings; Governing Law. The descriptive headings
of the several sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. The corporate
laws of the State of New Jersey shall govern all issues concerning the relative
rights of the Company and its stockholders. All other questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New Jersey, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New Jersey or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New Jersey. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in Hudson County and the United States District Court for
the District of New Jersey, for the adjudication of any dispute hereunder or in
connection herewith or therewith, or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to assert in any
suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.

      Section 15. Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR EACH PARTY
HERETO TO ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE ANY RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR
ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS TRANSACTION.

      IN WITNESS WHEREOF, the Company has caused this Warrant to be signed as of
the date first set forth above.

                                                     LASER ENERGETICS, INC.

                                                     By:    /s/ Robert D. Battis
                                                            --------------------
                                                     Name:  Robert D. Battis
                                                     Title: President & CEO

                                      A-15
<PAGE>

                              EXHIBIT A TO WARRANT

                                 EXERCISE NOTICE

                                 TO BE EXECUTED
                BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

                             LASER ENERGETICS, INC.

      The undersigned holder hereby exercises the right to purchase
______________ of the shares of Common Stock ("Warrant Shares") of Laser
Energetics, Inc. (the "Company"), evidenced by the attached Warrant (the
"Warrant"). Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.

Specify Method of exercise by check mark:

      1. ___ Cash Exercise

            (a) Payment of Warrant Exercise Price. The holder shall pay the
            Aggregate Exercise Price of $______________ to the Company in
            accordance with the terms of the Warrant.

            (b) Delivery of Warrant Shares. The Company shall deliver to the
            holder _________ Warrant Shares in accordance with the terms of the
            Warrant.

      2. ___ Cashless Exercise

            (a) Payment of Warrant Exercise Price. In lieu of making payment of
            the Aggregate Exercise Price, the holder elects to receive upon such
            exercise the Net Number of shares of Common Stock determined in
            accordance with the terms of the Warrant.

            (b) Delivery of Warrant Shares. The Company shall deliver to the
            holder _________ Warrant Shares in accordance with the terms of the
            Warrant.

Date: _______________ __, ______

Name of Registered Holder

By:_____________________________
Name:___________________________
Title:__________________________

                                      A-16
<PAGE>

                              EXHIBIT B TO WARRANT

                              FORM OF WARRANT POWER

      FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of Laser Energetics, Inc. represented
by warrant certificate no. _____, standing in the name of the undersigned on the
books of said corporation. The undersigned does hereby irrevocably constitute
and appoint ______________, attorney to transfer the warrants of said
corporation, with full power of substitution in the premises.

Dated:___________________________                 ______________________________

                                                  By:___________________________
                                                  Name:_________________________
                                                  Title:________________________

                                       B-1LICENSE AGREEMENT

                                TABLE OF CONTENTS

PREAMBLE TO LICENSE AGREEMENT

ARTICLES

I. ................................................................. DEFINITIONS
II. ............................................. IMPROVEMENTS AND CONSULTATIONS
III. ..................................................... LICENSES AND RELEASES
IV. ............................................ ROYALTIES, PAYMENTS AND RECORDS
V. ..................................................... OBLIGATIONS OF LICENSEE
VI. ......................................................... KEEPING OF RECORDS
VII. ............... GOVERNMENT CLEARANCE, PUBLICATION, OTHER USE, EXPORT DUTIES
VIII. ............................................. ENFORCEMENT AND INFRINGEMENT
IX. ....................................................... TERM AND TERMINATION
X. ...................................... TRANSFERABILITY OF RIGHTS AND LICENSES
XI. .............................................. DISCLAIMER OF PATENT WARRANTY
XII. ................................................................. INDEMNITY
XIII. ......................................................... NON USE OF NAMES
XIV. ................................................................. JUDGMENTS
XV. ............................................................ PATENT MARKINGS
XVI. .................................................. ATTORNEYS FEES AND COSTS
XVII. .................................................................. NOTICES
XVIII. .................................................................. WAIVER
XIX. .................................................................... TITLES
XX. .................................................................. SEVERANCE
XXI. .......................................................... ENTIRE AGREEMENT
XXII. ........................................................ SURVIVAL OF TERMS

                                                          LASER ENERGETICS, INC.
                                                          CONFIDENTIAL
                                                          DATE: 12-21-95
                                                                         /s/ RDB

                                  Page 1 of 12
<PAGE>

                       LICENSE AGREEMENT for TASK ORDER #1

PREAMBLE TO LICENSE AGREEMENT

      This license agreement goes into effect upon the completion of research
and development of Task Order #1 issued to UCF by LEI named ________________
Solid State 193nm Laser using ________________ and/or Rods.

      This Agreement is made by and between the Research Foundation of the
University of Central Florida on and behalf of the University of Central
Florida, and having an address and place of business at 4000 Central Florida
Blvd., Orlando, Florida, (hereinafter "UCF") and Laser Energetics, Incorporated,
a Florida corporation having an office and place of business at 7 Goldenrod
Court, Hamilton Township, New Jersey 08690 (hereinafter "LICENSEE").

      WHEREAS, UCF and LEI will be the owners of the future invention titled
"________________ Solid State ________________ Lasers at 193 nm" and own all
rights, title, and interest to Patent Rights, as hereinafter defined, pertaining
to such invention; and technical know-how is retained by Dr. Martin Richardson
of the Laser Plasma Laboratory (LPL) at the Center for Research and Education in
Optics and Lasers (CREOL),

      WHEREAS, UCF has the right to grant licenses to the foregoing invention,
and wishes to have the invention utilized in the public interest; and

      WHEREAS, UCF is willing to grant a license to LICENSEE to the invention
and related Patent Rights and Subject Technology, as hereinafter defined under
the same and conditions hereinafter set forth;

      WHEREAS, UCF and LICENSEE recognize the Task Order Research Agreement
governing the research under which this License Agreement has been issued;

      NOW, THEREFORE, in consideration of the premises and mutual covenants of
this Agreement, the parties hereto agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

For the purpose of this Agreement:

A. "Subject Technology", shall mean the invention entitled, "________________
Solid State ________________ Lasers at 193 nm" to be built as described in Task
Order #1 attached to this document and unpublished " know how" directly related
to said inventions and to Patent Rights, as herein defined, and all alterations
or improvements to the invention.

B. "Patent Rights" shall mean any and all United States and foreign patent
applications now or hereafter filed with respect of the Subject Technology and
any patent now issued or hereafter issuing on any such patent applications, as
well as substitutes, continuations, divisions, continuations-in-part, or
reissues thereof.

C. "Licensed Product" shall mean any product, process or use thereof (a) which
utilizes the Subject Technology; (b) which is covered by an unexpired claim
contained in the Patent Rights in the country in which the Licensed Product(s)
is made, used, sold or transferred; (c) which is manufactured by using a process
which is covered in an unexpired claim contained in the Patent Rights in the
country in which the Licensed Product(s) is made, used, sold or transferred; or
(d) the use of which is

                                                          LASER ENERGETICS, INC.
                                                          CONFIDENTIAL
                                                          DATE: 12-21-95
                                                                         /s/ RDB

                                  Page 2 of 12
<PAGE>

covered in an unexpired claim contained in the Patent Rights in the country in
which the Licensed Product(s) is made, used, sold, or transferred.

D. "Technical Information" means information concerning methods, processes,
materials and other information useful in manufacturing, assembling and/or using
_________ and/or _________ lasing devices.

E. "Gross Sales" shall mean LICENSEE's total invoiced billing for sales of
_________ lasing devices. Licensed Products shall be considered "sold" when
invoiced. No deductions shall be made for commissions paid to individuals or
employees of LICENSEE, nor for the cost of collection.

F. "Field of Use" shall mean _________ lasing at a wavelength of 193 nm, and the
range of tunability associated with the _________ of this laser.

G. "Territory" shall mean the entire world.

H. "Sales" shall mean any sale, transfer, lease, license, permission to use or
other transfer of right or possession or other conveyance by Licensee of
Licensed Product or Subject Technology.

                                   ARTICLE II
                          IMPROVEMENTS AND CONSULTATION

A. It is contemplated that UCF may, from time-to-time, make improvements to the
Licensed Products. Such improvements will be promptly disclosed to the Office of
Technology Transfer at UCF, and to the LICENSEE, and LICENSEE will advise UCF
within ninety (90) days of such disclosure whether LICENSEE desires to
incorporate such improvements into the Licensed Products sold or otherwise
disposed of by LICENSEE.

B. LICENSEE will maintain such improvements as confidential until advised
otherwise by UCF.

C. In the event that LICENSEE desires to incorporate such improvements, LICENSEE
will, at its own expense, file for patent protection on UCF's behalf of such
improvements in the United States and in any other countries in which the
Licensed Product is manufactured for LICENSEE.

D. All patents on improvements invented by UCF shall be assigned to UCF or to an
assignee designated by UCF. For any improvements which LICENSEE files and pays
for at least a United States patent application, the royalty addressed in
Article IV below shall not be increased.

E. If LICENSEE subsequently elects to incorporate such improvements on the
Licensed Product materials, but elects not to file for patent protection as
contemplated by paragraphs C above, the royalty rates set forth in Article IV
will be subject to re-negotiation and an equitable increase to reflect
development cost of such improvements and the costs associated with obtaining
patents thereon.

F. If LICENSEE or any sublicensees of LICENSEE develop improvements in Subject
Technology, LICENSEE agrees to disclose and submit such improvements to UCF for
its review.

G. LICENSEE agrees to pay for all foreign filings and related patents filed on
Subject Technology.

H. LICENSEE, to the extent it has the right to do so, agrees to grant to UCF a
nonexclusive license under such patents to make, have made, ("shop rights") the
Licensed Products, incorporating such improvements for research purposes.

                                  Page 3 of 12
<PAGE>

                                   ARTICLE III
                              LICENSES AND RELEASES

A. UCF hereby grants to LICENSEE and LICENSEE accepts from UCF, under the terms
and conditions herein specified, an exclusive license to make, have made, use
and sell Licensed Products, with the right to sublicense throughout the world,
on terms at least as restrictive as those provided herein. Such license is
worldwide and shall remain in effect, on a country by country basis, for the
duration of this agreement. Notwithstanding the foregoing, LICENSEE's rights and
license shall be subject to the rights of the U.S. Government pursuant to any
funding agreement between UCF and the U.S. Government.

B. LICENSEE shall have the right to sublicense parts of Subject Technology with
terms that are at least as favorable to UCF as contained in this agreement. A
copy of each sublicense shall be provided to UCF. Should this Agreement be
terminated for any reason, LICENSEE agrees to assign all such sublicenses
directly to UCF.

C. The license granted hereunder shall not be construed to confer any rights
upon LICENSEE by implication, estoppel or otherwise, as to any technology not
part of the Patent Rights licensed hereunder in the specified field of use.

D. LICENSEE agrees that the Licensed Products leased or sold in the defined
territory shall be manufactured as much as possible in the State of Florida.

                                   ARTICLE IV
                         ROYALTIES, PAYMENTS AND REPORTS

A. LICENSEE agrees to pay to The Research Foundation of the University of
Central Florida a royalty of 6% of Gross Sales of Licensed Products. This
royalty is to be distributed according to the policies of UCF.

B. LICENSEE agrees to make written reports of all Sales to UCF within fifteen
(15) days after the last day of each six - month interval during the life of
this Agreement. The first such report shall be due six months after the date of
this Agreement. The obligation to make these reports shall terminate on the
expiration date of this Agreement, except as to Sales or other dispositions or
manufacturing prior to such date of expiration. LICENSEE shall make such reports
even if there have been no Sales, or if no royalties are due to UCF for the
reporting period. Reports shall include but not be limited to the following:

      (1) total invoiced billings for all Sales

      (2) total royalties due UCF

      (3) names and addresses of sublicensees.

C. Royalty payments are due and payable concurrently with reports of Sales.

D. In the event that any payment of royalties due from LICENSEE under this
Agreement is for any reason not paid when due, i.e. , fifteen (15) days after
the end of each six month interval, LICENSEE shall pay to UCF interest on such
overdue payment during the period commencing fifteen (15) days from such due
date until the date that such overdue payment is actually made to UCF, the rate
of interest being equal to three percent (3%) above the highest commercial prime
rate of the Sun Bank, N.A., Alafaya/HWY. 50, Orlando, Florida in effect on the
date the payment first became due.

                                  Page 4 of 12
<PAGE>

E. All payments made as a result of this Agreement shall be paid in United
States Dollars in Orlando, Florida, or at such other place as UCF may reasonably
designate consistent with the applicable controlling laws and regulations in any
foreign country. If any currency conversion shall be required in connection with
the payment of royalties hereunder, such conversion shall be made by using the
exchange rate prevailing at the Sun Bank, N.A., on the last business day of the
calendar quarterly reporting period to which such royalty payments relate.

                                    ARTICLE V
                             OBLIGATIONS OF LICENSEE

LICENSEE UCF agrees to diligently pursue the development of the invention
according to the following due diligence requirements:

A. In the event royalties payable to UCF under this Agreement for the calendar
year ending December 31, 1996, do not equal or exceed Three Thousand Dollars
($3,000.00), or if the royalties payable to UCF during the calendar year ending
December 31, 1997 do not equal or exceed Ten Thousand Dollars ($10,000.00), or
if the royalties payable to UCF during the calendar year ending December 31,
1998, or any subsequent year thereafter during the term of this Agreement do not
equal or exceed Twenty Thousand Dollars ($20,000.00), UCF shall have the right,
upon sixty (60) days notice, to discontinue the license granted in Article III.
LICENSEE may however, maintain the exclusive character of its license,
notwithstanding any such notice from UCF, if it shall, prior to expiration of
the sixty (60) day notice period, pay to UCF a sum which, when added to the
royalties payable for the year in question, totals the minimum amount due for
that year as set forth above. Failure of UCF to give the notice provided in
reference to any given year or years shall not constitute a waiver of the right
to give such notice in reference to any subsequent year.

B. Licensee agrees to use its best efforts to have the subject technology
cleared for marketing in those countries in which LICENSEE intends to sell
Licensed Products by responsible government agencies requiring such clearance.
LICENSEE agrees to concurrently file the necessary data which may be required
prior to approval. If and when this agreement is terminated for any reason
whatsoever, LICENSEE shall assign its full interest and title in such market
clearance application, including all associated data to UCF at no cost to UCF.

C. Failure by LICENSEE to comply with the provisions of this agreement shall
result in UCF having the right to convert any exclusive license to a
non-exclusive license or to cancel the license upon sixty (60) days notice. This
would include a reversion of rights to all relevant materials, research
information and technology including patent rights, transferred by LICENSEE to
UCF.

                                   ARTICLE VI
                               KEEPING OF RECORDS

A. LICENSEE shall keep complete, true, and accurate books of accounts and other
records containing all particulars which may be necessary to ascertain and
properly verify such Sales. Upon UCF's request, but no less than 1 business day,
LICENSEE shall permit an independent Certified Public Accountant selected by UCF
and at UCF's expense (except one to whom LICENSEE has some reasonable objection)
to have access during ordinary business hours to such of LICENSEE's records as
may be necessary to determine, in respect of any three (3) month period ending
not more than five (5) years prior to the date of such request, the correctness
of any report made under this Agreement. Nothing herein shall be construed to
limit the authority of the State Comptroller or Auditor of Florida or any
similar official.

B. In the event that any examination or audit of conducted pursuant to this
Article V shall indicate an underpayment in royalties due UCF in an amount
greater than five percent (5%), LICENSEE

                                  Page 5 of 12
<PAGE>

agrees to reimburse UCF for any and all expenses incurred by the approved
accountant in conducting the examination or audit.

                                   ARTICLE VII
           GOVERNMENT CLEARANCE, PUBLICATION, OTHER USE, EXPORT DUTIES

A. LICENSEE agrees that the right of publication of the Subject Technology shall
reside in the inventor and other staff of UCF. UCF shall provide a copy of each
publication at the time of submission for pre-publication review according to
the procedure described in Article 5.3.e. of the Task Order Research Agreement.
Such review will be in no way construed as a right to restrict such publication,
unless the material provided to LICENSEE is proprietary to LICENSEE as defined
under Article 5.0, Proprietary Material, Confidentiality, and Use of Data, of
the Task Order Research Agreement.

B. It is agreed that notwithstanding any provisions herein, UCF is free to use
the Subject Technology and Patent Rights for its own educational, teaching, and
research purposes without restriction and without payment of royalties or other
fees;

C. This Agreement is subject to, and LICENSEE will comply with, all of the
United States laws and regulations controlling the export of technical data,
laboratory prototypes, and other commodities and technology which may be
applicable.

D. LICENSEE shall be solely responsible for the payment and discharge of any
taxes or duties relating to any transaction of LICENSEE, its employees,
contractors, or agents, in connection with the manufacture, use, or sale in any
country of Licensed Product(s).

E. LICENSEE shall be solely responsible for obtaining all approvals, such as,
for example, Underwriters Laboratory (U.L.) approval for Licensed Products,
necessary or advisable for sale or use of Licensed Products in the United States
and throughout the world.

F. LICENSEE agrees to comply with all applicable laws and regulations in the
manufacture, sale and delivery of Licensed Products, including, but not limited
to, FCC regulations, Import/Export regulations and the antitrust laws of the
United States.

                                  ARTICLE VIII
                          ENFORCEMENT AND INFRINGEMENT

A. While and as long as its license under this Agreement remains exclusive,
LICENSEE is empowered:

                  1) to bring suit in its own name or, if required by law,
                     jointly with UCF, at its own expense and on its own behalf,
                     for infringement of the invention and/or Licensed Patents;

                  2) in any such suit, to enjoin infringement and to collect for
                     its use, damages, profits and awards of whatever nature
                     recoverable for such infringement and or civil action;

                  3) to settle any claim or suit for infringement of invention
                     and/or Licensed Patents by granting the infringing party a
                     sublicense under the provisions of Article III of this
                     Agreement.

B. In the event UCF shall bring to the attention of LICENSEE any trade secret
and/or unlicensed infringement of the Licensed Patents, and LICENSEE shall not,
within six (6) months:

                  1) secure cessation of the infringement, or

                                  Page 6 of 12
<PAGE>

                  2) enter suit against the infringer, or

                  3) provide UCF with evidence of the pendency of a bona fide
                     negotiation for the acceptance by the infringer of a
                     sublicense under the Licensed Patents,

then UCF shall have the right to sue for infringement at UCF's own expense and
to collect for its own use all damages, profits, and awards of whatever nature
recoverable for such infringement, and the License herein granted shall
forthwith become null and void.

C. LICENSEE shall indemnify and hold UCF harmless from any and all damages,
losses, liability, and costs resulting from a charge of infringement or civil
action attributable to the invention. This liability shall extend to
sublicensees in that the sublicensees shall indemnify and hold harmless UCF in
all infringement or civil action.

D. To the extent authorized under the laws and constitution of the State of
Florida, UCF shall hold LICENSEE harmless from any and all damages, losses,
liability, and costs resulting from a charge of infringement or civil action
attributable to the invention.

E. In any infringement suit instituted by either party to enforce the Patent
Rights, the other party hereto shall at the request and expense of the party
initiating such suit, cooperate in all respects and, to the extent possible,
have its employees testify when requested and make available relevant records,
papers, information, samples, specimens and the like.

F. LICENSEE shall have the sole right in accordance with the terms and
provisions herein to sublicense any alleged infringer under the Patent Rights
for future infringements.

                                   ARTICLE IX
                              TERM AND TERMINATION

A. Unless previously terminated in accordance with the provision of this Article
IX, this Agreement shall terminate at midnight on December 31, 2005. The term of
this Agreement may be extended by LICENSEE upon written application to UCF at
least ninety (90) days prior to the expiration of this Agreement. Any extension
of this Agreement shall be subject to renegotiation of the royalty provision set
forth in Article IV hereof.

B. LICENSEE shall have the right to terminate the license granted herein under
the invention and License Patents by written notice to UCF at least six (6)
months prior to the date such termination is to take effect, but other rights
granted herein to shall remain in full force and effect.

C. Should LICENSEE fail to pay UCF royalties due and payable hereunder, UCF
shall have the right to terminate this Agreement on thirty (30) days notice,
unless LICENSEE shall pay UCF, within the thirty (30) day period, all such
royalties and interest due and payable. Upon the expiration of the thirty (30)
day period, if LICENSEE shall not have paid all such royalties and interest due
and payable, the rights, privileges and license granted hereunder shall
terminate. LICENSEE may terminate this Agreement by giving UCF written notice at
least ninety (90) days prior to such termination, and thereupon terminate the
manufacture, use, or sale of Licensed Products

D. Any termination of this Agreement hereunder shall not relieve LICENSEE from
its obligation under Article IV hereof to make a terminal report or from its
liability for payment of royalties on Licensed Products sold or otherwise
disposed of hereunder prior to the date of such termination, and shall not
prejudice the right of UCF to recover any royalty or interest due or accrued at
the time of such termination and shall not prejudice any cause of action or
claim of UCF accrued or to accrue on account of any breach or default by
LICENSEE.

                                  Page 7 of 12
<PAGE>

E. Any termination of this Agreement hereunder shall not prejudice the right of
UCF to conduct a final audit of the books and records of LICENSEE in accordance
with the provisions of Article VI hereof.

F. In the event an order for relief is entered against LICENSEE under the
Federal Bankruptcy Code, or an order appointing a receiver for substantially all
of LICENSEE's assets is entered by a court of competent jurisdiction, or
LICENSEE makes an assignment for the benefit of creditors, or a levy of
execution is made upon substantially all of the assets of LICENSEE and such levy
is not quashed or dismissed within thirty (30) days, this Agreement shall
automatically terminate effective on the date of such order or assignment or, in
the case of such levy, the expiration of such thirty day period; provided,
however, that such termination shall no way impair or prejudice any right or
remedy that UCF might have under this Agreement.

G. No failure by either Party to insist upon strict performance of any of the
provisions hereof, nor either Party's failure or delay in exercising any rights
or remedies provided herein or by law, shall be deemed a waiver of any rights of
either Party to insist upon strict performance hereof or of either Party's
rights or remedies under this License Agreement or law, and shall not operate as
a waiver of any of the provisions hereof.

                                    ARTICLE X
                     TRANSFERABILITY OF RIGHTS AND LICENSES

A. The obligations of LICENSEE hereunder, including the obligations to make
reports and pay royalties, shall ran in favor of the successors, assignees, or
other legal representatives of UCF.

B. LICENSEE's rights under this Agreement and the license herein granted shall
pass to any receiver for the benefit of the creditors of LICENSEE and to any
receiver of its assets, or to any person or corporation succeeding to its entire
business and goodwill in Licensed Products as the result of sale, consolidation,
reorganization, or otherwise, provided any such assignee, receiver, person, or
corporation shall without delay, accept in writing the provisions of this
Agreement and agree to become in all respects bound thereby in the place and
stead of LICENSEE, but shall not otherwise be transferred without written
consent of UCF.

                                   ARTICLE XI
                          DISCLAIMER OF PATENT WARRANTY

A. UCF does not warrant that any invention which may be the subject of a patent
application licensed hereunder will be patentable.

B. Nothing contained in this Agreement shall be construed as a warranty or
representation that the use of Technical Information or any inventions of any
patent applications or patents licensed hereunder will be free from infringement
of patents of third parties.

C. Nothing contained in this Agreement shall be construed as an obligation of
UCF to bring or to prosecute actions or suits against third parties for
infringement of any patent, or as an obligation by UCF to defend any actions
brought by any third party(s) alleging infringement of or claims of damages in
respect to any patent of such third party(s).

D. In the event LICENSEE should be required to defend itself against any
infringement claims, actions or suits of any third party(s) as a consequence of
LICENSEE's use of any Technical Information furnished by UCF hereunder, UCF
shall provide at LICENSEE request up to ten (10) man-days of UCF's time for
consultation with UCF's technical and patent experts at in respect to

                                  Page 8 of 12
<PAGE>

each infringement claim, action or suit in which LICENSEE may become involved
during this Agreement.

E. Such consultation shall be without additional charge to LICENSEE except for
payment of any travel and Living expenses incurred by UCF in attending any
meeting or consultation at the request of LICENSEE.

F. UCF MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER
EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE AND VALIDITY OF PATENT
RIGHTS CLAIMS ISSUED OR PENDING. FURTHER, UCF MAKES NO REPRESENTATIONS AND
EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESSED OR IMPLIED, THAT THE USE OF
THE INVENTION WILL NOT INFRINGE ANY PATENT OR OTHER PROPRIETARY RIGHT OF A THIRD
PARTY.

                                   ARTICLE XII
                                    INDEMNITY

A. LICENSEE shall indemnify, defend and hold the State of Florida, the Board of
Regents of Florida, the State University System of Florida, UCF, its trustees,
officers, employees and affiliates, harmless against all claims and expenses,
including legal expenses and reasonable attorneys' fees, arising out of the
death or injury to any person or persons or out of any damage to property and
against any other claim, proceeding, demand, expense and liability of any kind
whatsoever resulting from utilization of the Patent Rights in the production,
manufacture, sales, use, lease, consumption or advertisement of the Licensed
Products by LICENSEE and its sublicensees or arising from any obligations of
LICENSEE hereunder, except for any claims or expenses arising out of the
negligence or willful misconduct of UCF or its officers, agents or employees.
The parties agree that UCF's liability shall be subject to the limitations
defined in Florida Statutes 95.11, 111.07, 607.0850, 607.1621, 608.404,
608.4363, 768.28, 768.30.

B. UCF shall have no obligation, expressed or implied, to supervise, monitor,
review, or otherwise assume responsibility for the production, manufacture,
testing, marketing, or sale of any Licensed Product.

C. UCF shall have no liability whatsoever related to LICENSEE or any third party
activities for or on account of any injury, loss, or damage, of any kind or
nature, sustained by, or any damage assessed or asserted against, or any other
liability incurred by or imposed upon LICENSEE or any other person or entity,
arising out of or in connection with or resulting from

      (1) the production, use or sale of any Licensed Product

      (2) the use of any Subject Technology

      (3) any advertising or other promotional activities with respect to any of
          the foregoing

                                  ARTICLE XIII
                                NON-USE OF NAMES

A. LICENSEE shall not use the name of UCF, or any trademark, trade device,
service mark, symbol, or any abbreviation, contraction, or simulation thereof,
owned by UCF, nor the names of any office employees, or any adaptation thereof,
in any advertising, promotional, or sales literature without prior written
consent obtained from an authorized officer of UCF in each case, which consent
shall not be unreasonably withheld.

B. LICENSEE may state that it is licensed by UCF under one or more of the
patents and/or patent applications comprising the Patent Rights. Failure by
LICENSEE to comply with this restriction

                                  Page 9 of 12
<PAGE>

shall be deemed cured it the offending use is terminated within ninety (90) days
of LICENSEE receipt of a written notice from UCF.

                                   ARTICLE XIV
                                    JUDGMENTS

A. If, in any proceeding in which the validity or infringement of any of the
aforesaid licensed claims is in issue, a judgment or decree is entered which
becomes not further reviewable through the exhaustion of all permissible
applications for rehearing or review by a superior tribunal (hereinafter
referred to as an "irrevocable judgment"), the construction placed upon any such
claim by any such irrevocable judgment shall be thereafter followed not only as
to such claim but as to all claims to which such construction applies, with
respect to acts occurring thereafter; and, if such irrevocable judgment holds
any claim invalid, LICENSEE shall be relieved thereafter from including in its
reports hereunder Licensed Products sold thereafter where there is royalty
liability only by reason of such claim or any other claim in which such
irrevocable judgment is applicable, and from the performance of those other acts
which may be required by this Agreement only because of such claim; the decision
of the higher tribunal shall be followed until the less favorable decision has
been followed by the irrevocable judgment of another tribunal of at least equal
dignity.

                                   ARTICLE XV
                                 PATENT MARKINGS

A. LICENSEE agrees to mark all Licensed Products sold or otherwise disposed of
by it under this Agreement with the words "Patent" and the number or numbers of
the Licensed Patent applicable thereto on the packaging.

                                   ARTICLE XVI
                             ATTORNEY FEES AND COSTS

A. In any action brought to enforce any provision of this Agreement, the
prevailing party shall be entitled to reimbursement of all reasonable attorney
fees and costs associated with such action. Such reimbursement shall not apply
to any action or portion thereof directed solely to the issue of validity of one
or more claims of the Licensed Patents, except that the court hearing such
action shall not be precluded from awarding attorney fees and costs as it deems
appropriate.

                                  ARTICLE XVII
                                     NOTICES

A. All notices provided for in this Agreement shall be given in writing and
shall be effective when either (1) served by personal delivery or (2) deposited,
postage prepaid, as Registered or Certified Mail addressed to the parties
respectively at the following addresses:

On behalf of LICENSEE:
Mr. Robert Battis
Laser Energetics, Inc.
7 Goldenrod Court
Hamilton Township, New Jersey 08690

                                 Page 10 of 12
<PAGE>

As to the University of Central Florida:
Office of Technology Transfer
Research and Graduate Studies
12424 Research Parkway Suite 256
Orlando, Florida 32817

or to other such address or addresses as LICENSEE or UCF respectively, may later
fix by written notice to the other.

                                  ARTICLE XVIII
                                     WAIVER

A. The failure of a party in any instance to insist upon the strict performance
of the terms of this Agreement shall not be construed to be a waiver or
relinquishment of any of the terms of this Agreement, either at the time of the
party's failure to insist upon strict performance or at any time in the future,
and such term or terms shall continue in full force and effect.

                                   ARTICLE XIX
                                     TITLES

A. All titles and article headings contained in this Agreement are inserted only
as a matter of convenience and reference. They do not define, limit, extend, or
describe the scope of this Agreement or the intent of any of its provisions.

                                   ARTICLE XX
                                    SEVERANCE

A. Each clause of this Agreement is a distinct and severable clause and if any
clause is deemed illegal, void, or unenforceable, the validity, legality, or
enforceability of any other clause or portion of this Agreement will not be
affected thereby.

                                   ARTICLE XXI
                                ENTIRE AGREEMENT

A. This Agreement contains the entire and only agreement between the parties,
and it supersedes all preexisting agreements between such parties.

B. This agreement merges all prior discussions between the parties and neither
party shall be bound by conditions, definitions, warranties, understandings, or
representations regarding the invention unless otherwise provided in this
agreement or as otherwise provided later in writing and signed by the authorized
agents of the parties.

C. This agreement can be modified or amended only by written agreement duly
signed by persons authorized to sign agreements on behalf of the parties.

                                  ARTICLE XXII
                                SURVIVAL OF TERMS

A. The provisions of Articles I, II, VII, X, XI, XII, XIII, XIV, XVII, XVIII,
XIX, and XXII shall survive the expiration or termination of this Agreement.

This Agreement shall be interpreted in accordance with the laws of the State of
Florida.

                                 Page 11 of 12
<PAGE>

IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their
duly authorized officers or representatives effective as of the date first
written below.

University of Central Florida                       Laser Energetics, Inc.

/s/ Diane M. Jacobs                                 /s/ Mr. Robert Battis
------------------------------------------------    ----------------------------
Diane M. Jacobs                                     Mr. Robert Battis
Vice President for Research and Graduate Studies    President & CEO

Date: 12/20/95                                      Date: 12/21/95
      ------------------------------------------          ----------------------

                                 Page 12 of 12

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