Document:

THE
SHARES BEING SUBSCRIBED FOR HEREIN HAVE NOT BEEN REGISTERED WITH THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION (“SEC”) UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED, (THE “1933 ACT”) OR THE SECURITIES COMMISSION OF ANY STATE
UNDER ANY STATE SECURITIES LAW. THEY ARE BEING OFFERED PURSUANT TO AN EXEMPTION
FROM REGISTRATION PURSUANT TO SECTION 4(2) OF THE 1933 ACT. THE SHARES MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED UNLESS THE SHARES ARE REGISTERED UNDER
THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL IS
OBTAINED WHICH IS REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH OFFERS, SALES
AND TRANSFERS MAY BE MADE PURSUANT TO AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THOSE LAWS.

 

 

SECOND
STOCK PURCHASE AGREEMENT

 

 

THIS
SECOND STOCK PURCHASE AGREEMENT (the “Agreement”) is made as of March 16, 2005,
by and between Bionutrics, Inc., a Nevada corporation (the “Company”), and
Nostrum Pharmaceuticals, Inc., a Delaware corporation (the
“Investor”).

 

THE
PARTIES HEREBY AGREE AS FOLLOWS:

 

1. Purchase
and Sale of Stock.

 

1.1 Sale
and Issuance of Stock. On the
basis of the representations, warranties and agreements contained herein and
subject to the terms and conditions herein set forth, the Company agrees to
issue six million (6,000,000) shares of its Common Stock, $.001 par value (the
Shares”), and the Investor hereby subscribes for and agrees to purchase the
Shares upon acceptance of this Agreement by the Company.

 

1.2 Payment. As
consideration for the issuance of the Shares, Investor is delivering with this
Agreement a Technology License Agreement dated as of March 16, 2005 (the
“License Agreement”), setting forth an exclusive worldwide license under the
technology specified therein to develop, make, have made, use, import, offer for
sale, market and sell the products specified in the License
Agreement.

 

1.3 Closing. The
closing of the transaction contemplated by this Agreement (the “Closing”) shall
be deemed to have occurred when this Agreement has been executed by both the
Investor and the Company and payment shall have been made as set forth in
Section 1.2 above in consideration for the Company’s promise and agreement to
deliver within fifteen (15) days certificates representing the Shares subscribed
for. If at the Closing any of the conditions specified in Articles 5 and 6
hereof shall not have been fulfilled to the reasonable satisfaction of the
Company or the Investor, respectively, then the affected party, at its election,
shall be relieved of all of its obligations under this Agreement, without
thereby waiving any other rights it may have as a result of the failure of those
conditions.

 

2. Representation
and Warranties of the Company. The
Company hereby represents and warrants to the Investor as follows:

 

2.1 Organization,
Good Standing and Qualification. The
Company is a corporation validly existing and in good standing under the laws of
the State of Nevada and has all requisite power and authority to own or lease
and operate its properties and assets and to carry on its business as now
conducted. The Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure so to qualify would have a
material adverse effect on its business, operations, prospects, condition
(financial or other), or properties. 

 

2.2 Capitalization. The
authorized capital of the Company consists of: 

 

(i)
Common
Stock.
45,000,000 shares of common stock (“Common Stock”), par value $.001, of which
16,252,100 shares are issued and outstanding as of March 11, 2005.

 

(ii)
Preferred
Stock.
5,000,000 shares of preferred stock (“Preferred Stock”), par value $.001,
591,685 shares of which are outstanding and convertible into 118,370 shares of
common stock at the election of the Company or shareholder. Further Preferred
Stock may be issued from time to time in one or more series, and the Board of
Directors is authorized to fix the rights and terms relating to dividends,
conversion, voting, redemption, liquidation preferences and any other rights,
preferences, privileges and restrictions applicable to each such
series.

 

(iii)
Warrants,
Options and Other Rights. There
are no preemptive rights or rights of first refusal for the purchase or
acquisition from the Company of any shares of its capital stock. As of March 11,
2005, there were outstanding warrants and options to purchase up to 307,000
shares of Common Stock.

 

2.3 Subsidiaries.
The
Company’s direct or indirect ownership in any other corporation, partnership,
joint venture association or other business enterprise, as stated in its Form
10-K for the year ended October 31, 2004, has not materially changed from that
date, and the Investor can rely upon that information as being true and correct
as of the date of this transaction.

 

2.4 Valid
Issuance of Shares. All of
the outstanding shares of the Company's stock have been duly and validly
authorized and issued, are fully paid and nonassessable, and no further approval
or authority of the stockholders or the directors of the Company will be
required by the Company for the issuance of the Shares. The Shares when issued
and paid for in accordance with the terms of this Agreement will be duly
authorized, validly issued and outstanding, fully paid and nonassessable, free
from preemptive rights and will be free from any pledge, lien, encumbrance or
restriction on transfer other than restrictions on transfer under applicable
state and federal securities laws and issued in compliance with all state and
federal securities laws.

 

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2.5 Financial
Statements.

 

(a) The
Company has delivered to Investor a true and correct copy of its financial
statements for the three (3) fiscal years ended October 31, 2005, which are part
of its Form 10-K for the three years ended October 31, 2004 (the “Financial
Statements”). The Financial Statements have been prepared in conformity with
United States generally accepted accounting principles applied on a consistent
basis, except as noted therein. The Financial Statements are true and correct
and fairly present the financial position, result of operations and cash flows
and changes in financial position of the Company as of the dates and for the
periods indicated. 

 

(b) Except as
reflected in the Financial Statements, the Company has no liabilities, absolute
or contingent, material to the operations, business, prospects, assets,
properties or condition (financial or other) of the Company, other than (i)
ordinary course liabilities incurred since the last date of the Financial
Statements in connection with the conduct of the business of the Company, and
(ii) obligations under contracts and commitments incurred in the ordinary course
of business and not required under United States generally accepted accounting
principles to be reflected in the Financial Statements, which, in both cases,
individually or in the aggregate, are not material to the financial condition or
operating results of the Company.

 

2.6 Tax
Returns and Audits. The
Company last filed a tax return with respect to fiscal year 2000. Segal Miller
McClain has prepared returns for 2001, 2002, 2003 and 2004, which will be filed
upon receipt of certain information from InCon Processing, LLC. The Company owes
no taxes for those years as expenses exceeded revenues. The Company is not
delinquent in the payment of any tax or in the payment of any assessment or
governmental charge. The Company has not received notice of any tax deficiency
proposed or assessed against it, and it has not executed any waiver of any
statute of limitations on the assessment or collection of any tax. None of the
Company’s tax returns has been audited by governmental authorities in a manner
to bring those audits to the Company’s attention. The Company does not have any
tax liabilities except those reflected on the Financial Statements or incurred
since the date of the Financial Statements in the ordinary course of
business. 

 

2.7 Licenses. The
Company possesses from the appropriate agency, commission, board and government
body and authority, whether state, local or federal, all material licenses,
permits, authorizations, approvals, franchises and rights that are necessary for
it to engage in the business currently conducted by it. The Company has no
reason to believe that it will not be able to obtain all licenses, permits,
authorizations, approvals, franchises and rights that may be required for any
business the Company proposes to conduct.

 

2.8 Books
and Records. The
Company maintains a system of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management’s general or specific authorization, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.

 

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2.9 No
Conflict with Other Instruments. Neither
the authorization, issuance and sale of the Shares, nor the execution, delivery
and performance by the Company of this Agreement nor the consummation of the
transactions herein contemplated, will: (i) contravene or conflict with or
constitute a breach of, permit the termination of, constitute a default under,
or violation of (a) the Articles of Incorporation, as amended, or bylaws of the
Company, (b) any material agreement, indenture, mortgage, deed of trust or other
material instrument or agreement or undertaking by which the Company is bound or
to which any of its properties or assets is subject, or, (c) to the knowledge of
the Company, a violation of any law, administrative regulation, or court decree
to which the properties or assets of the Company is subject; or (ii) result in
the creation or imposition of any material Lien upon the property or assets of
the Company. For purposes of this Agreement, “Lien” means, with respect to any
asset, any mortgage, lien, pledge, charge, security interest, encumbrance or
restriction of any kind in respect of an asset.

 

2.10 Authorization. The
Company has the corporate power and authority to enter into this Agreement and
to perform all of its obligations hereunder. The execution, delivery and
performance of this Agreement by the Company have been duly authorized by all
necessary corporate actions, and this Agreement constitutes a legal, valid,
binding and enforceable obligation of the Company. No consent, approval,
authorization or order of any court or governmental agency or board or any other
third party, or registration, qualification, designation or filing with any
federal, state or local authority is required to consummate the transactions
contemplated by this Agreement.

 

2.11 Disclosure. The
Company has not knowingly withheld from Investor any material facts relating to
the assets, business, operations, financial condition or prospects of the
Company. No representation or warranty in this Agreement or in any certificate,
schedule, statement or other document furnished or to be furnished to Investor
pursuant hereto or in connection with the transactions contemplated hereby
contains or will contain any untrue statement of a material fact or omits or
will omit to state any material fact required to be stated herein or therein or
necessary to make the statements herein or therein not misleading.

 

2.12 No
Brokers or Finders. No
person, firm or corporation has or will have, as a result of any act or omission
of the Company, any right, interest or valid claim against the Company for any
commission, fee or other compensation as a finder or broker in connection with
the transactions contemplated by this Agreement.

 

3. Representations
and Warranties of Investor. By
executing this Agreement, Investor hereby represents and warrants to and
covenants with the Company as follows:

 

3.1 Authorization.
Investor has the power and authority to enter into this Agreement and to perform
all of its obligations hereunder, and this Agreement constitutes a valid,
binding and enforceable obligation of Investor.

 

3.2 Legal
Investment and Compliance with Laws. The
purchase of the Shares by Investor is legally permitted by all laws and
regulations to which Investor is subject and all consents, approvals,
authorizations of or designations, declarations, or filings in connection with
the valid execution and delivery of this Agreement by Investor or the purchase
of the Shares by Investor has been obtained. Investor hereby represents that it
has satisfied itself as to the full observance of the laws of its jurisdiction
in connection with any invitation to subscribe for the Shares or any use of this
Agreement, including (i) any foreign exchange restrictions applicable to the
purchase, and (ii) the income tax and other tax consequences, if any, which may
be relevant to the purchase, holding, redemption, sale, or transfer of the
Shares. The Investor's subscription and payment for, and its continued
beneficial ownership of the Shares, will not violate any applicable securities
or other laws of its jurisdiction.

 

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3.3 Access
to Information.
Investor acknowledges that it has received the Company's Form 10-K for the three
years ended October 31, 2004, (the “Offering Documents”), and is familiar with
and understands the operations of the Company.

 

(a)  Investor
understands and acknowledges that the Offering Documents provided in connection
with this investment have been prepared by the Company. Accordingly, Investor
understands and acknowledges that no independent investment banking firm or
legal counsel have passed upon or assumed any responsibility for the accuracy,
completeness or fairness of the information contained in the Offering
Documents.

 

(b)  Investor
understands and acknowledges that any financial projections provided in
connection with this investment have not been prepared by independent
accountants and are based on numerous assumptions regarding sales, revenues and
expenses and other factors which may not be realized in the future.

 

(c)  Investor
acknowledges that it has been encouraged to rely upon the advice of its legal
counsel and accountants or other financial advisers with respect to the
financial, tax and other considerations relating to the purchase of the Shares
and has been offered, during the course of discussions concerning the purchase
of the Shares, the opportunity to ask those questions and inspect those
documents concerning the Company and its business and affairs as Investor has
requested so as to understand more fully the nature of the investment and to
verify the accuracy of the information supplied.

 

(d)  Investor
represents and warrants that, in determining to purchase the Shares, it has
relied solely upon the documents provided and the advice of its advisors with
respect to the tax, foreign and U.S., and other con-sequences involved in
pur-chasing the Shares.

 

3.4 Acquisition
for Investment and Unregistered Nature of the Shares.

 

(a)  Investor
represents and warrants that the Shares being acquired are being acquired for
its own account, without a view to public distribution or resale, and that
Investor has no contract, understanding, agreement or arrangement to sell or
otherwise transfer or dispose of the Shares or any portion thereof to any other
person.

 

(b)  Investor
represents and warrants that it (i) is experienced in evaluating and investing
in securities of companies in the developmental stage and acknowledges that it
can fend for itself, (ii) can bear the economic risk of the purchase of the
Shares including the total loss of its investment, and (iii) has such knowledge
and experience in business and financial matters as to be capable of evaluating
the merits and risks of an investment in the Shares.

 

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(c)  Investor
understands that the Shares have not been registered under the 1933 Act, or the
securities laws of any state and are subject to substantial restrictions on
resale or transfer.

 

(d)  Investor
agrees that it will not sell or otherwise transfer or dispose of the Shares or
any portion thereof unless the Shares are registered under the 1933 Act and any
applicable state securities laws or unless Investor obtains an opinion of
counsel, which is reasonably satisfactory to the Company, that the Shares may be
sold in reliance on an exem-ption from those registration
requirements.

 

(e)  Investor
understands that (i) the Company may place a legend on any certificates
representing the Shares indicating that the Shares may not be transferred except
in accordance with an exemption from the 1933 Act; (ii) the Company will not
register a transfer not made in accordance with an exemption from the 1933 Act;
and (iii) Investor therefore may be precluded from selling or otherwise
transferring or disposing of any of the Shares or any portion thereof for an
indefinite period of time or at any particular time.

 

3.5 Further
Representations and Understandings.

 

(a)  Investor
understands that no federal or state agency including the SEC, the Arizona
Corporation Commission or the securities commission or authorities of any other
state has approved or disapproved the Shares, passed upon or endorsed the merits
of the offering or the accuracy or adequacy of the documents, or made any
finding or determination as to the fairness of the Shares for public investment
and any representation to the contrary is a criminal offense.

 

(b)  Investor
understands that the Shares are being offered and sold in reli-ance on specific
exemptions or exclusions from the registration requirements of federal and state
laws and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings set
forth herein in order to determine the suitability of Investor to acquire the
Shares.

 

(c)  Investor
represents and warrants that the information set forth herein concerning
Investor is true and correct.

 

3.6 No
Brokers or Finders. No
person, firm or corporation has or will have, as a result of any act or omission
by Investor, any right, interest or valid claim against the Company for any
commission, fee or other compensation as a finder or broker, or in any similar
capacity, in connection with the transactions contemplated by this
Agreement.

 

4. Registration
Rights.

 

4.1 Registration
Statement. The
Company shall upon the Investor’s request (i) prepare and file with the SEC a
Registration Statement under the 1933 Act covering the Shares or shall include
the Shares in any other Registration Statement it is obligated to file
subsequent to the date hereof, (ii) use its best efforts to have the
Registration Statement rendered effective under the 1933 Act as soon as
practicable thereafter, and (iii) take such action as may be necessary to have
the Registration Statement remain effective under the 1933 Act, free of material
misstatements or omissions, for the period during which Investor is subject to
the time, volume restrictions, or manner of sale limitations under Rule 144 of
the 1933 Act (“Rule 144”), or any successor rule or regulation (the “Effective
Period”). The Company shall bear all fees, disbursements and out-of-pocket
expenses incurred in connection with the preparation and filing of the
Registration Statement, including any amendment or supplement thereto necessary
to cause the same to remain free of material misstatements or omissions during
the period the Registration Statement remains effective under the 1933 Act,
except as provided in Section 4.6 hereof.

 

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4.2 Black-out
Period. Any
period within the Effective Period during which the Company fails to keep the
Registration Statement effective and usable for resales of the Shares, or
requires pursuant to this Section that the Investor not effect sales of the
Shares pursuant to the Registration Statement, is hereafter referred to as a
“Suspension Period.” A Suspension Period shall commence on the date set forth in
a written notice by the Company (with respect to which the Company shall use
good faith efforts (consistent with legal and contractual obligations) to
deliver to the Investor (not less than two Business Days in advance of any
proposed or anticipated Suspension Period) that the Registration Statement is no
longer effective or that the prospectus included in the Registration Statement
is no longer usable for resales of Shares or, in the case of a suspension
pursuant to this Section the date specified in the notice delivered by the
Company pursuant to this Section, and shall end on the date when the Investor
either receives the copies of the supplemented or amended prospectus or is
advised in writing by the Company that use of the prospectus or sales may be
resumed, provided, however, that (i) there shall be no Suspension Period for the
period of time commencing on the Closing Date and ending one-hundred twenty
(120) days thereafter; (ii) no Suspension Period shall last more than 60 days,
and, if it has not expired earlier pursuant to the terms hereof, the Suspension
Period shall expire on its 60th day, and
(iii) each Suspension Period shall extend the Effective Period by the same
length of time, and the Company shall take all necessary actions to cause the
same as promptly as possible. After each Suspension Period, the Company shall
notify the Investor of the extended expiration date of the Effective Period.

 

4.3 Registration
Procedure. To
effect the registration of the Shares under the 1933 Act, the Company
shall:

 

(i) prepare
and file with the SEC a registration statement with respect to the securities
and use its best efforts to cause the registration statement to become and
remain effective for the period reasonably necessary to effect the sale of the
securities;

 

(ii) prepare
and file with the SEC amendments to the registration statement and supplements
to the prospectus contained therein as may be necessary to keep the registration
statement effective for the period reasonably necessary to effect the sale of
the securities;

 

(iii) furnish
to Investor a reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as Investor
and underwriters may reasonably request in order to facilitate the public
offering of the securities;

 

(iv) use its
best efforts to register or qualify the securities covered by the registration
statement under the state securities or blue sky laws of the State of Nevada,
Arizona, New York and five other states, except that Investor may request other
states in which the Company will register and bear the fees and expenses in
connection with those registrations or qualifications, as Investor may
reasonably request within twenty (20) days following the original filing of the
registration statement, except that the Company shall not for any purpose be
required to execute a general consent to service of process or to qualify to do
business as a foreign corporation in any jurisdiction wherein it is not so
qualified;

 

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(v) notify
Investor participating in the registration, promptly after it shall receive
notice thereof, of the time when the registration statement has become effective
or a supplement to any prospectus forming a part of the registration statement
has been filed;

 

(vi) notify
Investor promptly of any request by the SEC for the amending or supplementing of
the registration statement or prospectus or for additional
information;

 

(vii) prepare
and file with the SEC, if necessary, promptly upon the request of Investor, any
amendments or supplements to the registration statement or prospectus which, in
the opinion of counsel for Investor (and concurred in by counsel for the
Company), is required under the 1933 Act or the rules and regulations thereunder
in connection with the distribution of the Shares by Investor;

 

(viii) prepare
and promptly file with the SEC, if necessary, and promptly notify Investor of
the filing of an amendment or supplement to the registration statement or
prospectus as may be necessary to correct any statements or omissions if, at the
time when a prospectus relating to the securities is required to be delivered
under the 1933 Act, any event shall have occurred as the result of which any
prospectus then in effect would include an untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in
the light of the circumstances in which they were made, not
misleading;

 

(ix) advise
Investor, promptly after it shall receive notice or obtain knowledge thereof, of
the issuance of any stop order by the SEC suspending the effectiveness of such
registration statement or the initiation or threat of any proceeding for that
purpose and promptly use its best efforts to prevent the issuance of any stop
order or to obtain a withdrawal if a stop order should be issued;

 

(x) not file
any amendment or supplement to the registration statement or prospectus to which
Investor shall have reasonably objected on the grounds that the amendment or
supplement does not comply in all material respects with the requirements of the
1933 Act or the rules and regulations thereunder, after having been furnished
with a copy thereof at least five business days prior to filing, unless in the
opinion of counsel for the Company the filing of the amendment or supplement is
reasonably necessary to protect the Company from liability under any applicable
federal or state law and the filing will not violate applicable law;
and

 

8

(xi) at the
request of Investor, furnish on the effective date of the registration statement
and, if the registration includes an underwritten public offering, at the
closing provided for in the underwriting agreement: (a) opinions, dated the
respective dates, of counsel representing the Company for the purposes of the
registration, addressed to the underwriters, if any, and to Investor covering
those matters the underwriters and Investor may reasonably request, in which
opinion counsel shall state (without limiting the generality of the foregoing)
that (1) the registration statement has become effective under the 1933 Act; (2)
to the best of counsel’s knowledge no stop order suspending the effectiveness
thereof has been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the 1933 Act; (3) the registration
statement and each amendment or supplement thereto comply as to form in all
material respects with the requirements of the 1933 Act and the applicable rules
and regulations of the SEC thereunder (except that counsel need express no
opinion as to financial statements contained therein); (4) to the best of the
knowledge of counsel neither the registration statement nor any amendment nor
supplement thereto contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading (except that counsel need express no opinion
as to financial statements contained therein); (5) the description in the
registration statement or any amendment or supplement thereto of legal and
governmental proceedings and contracts are accurate and fairly present the
information required to be shown; and (6) counsel does not know of any legal or
governmental proceedings, pending or threatened, required to be described in the
registration statement or any amendment or supplement thereto which are not
described as required nor of any contracts or documents or instruments of the
character required to be described in the registration statement or amendment or
supplement thereto or to be filed as exhibits to the registration statement,
which are not described or filed as required; and (b) letters, dated such
respective dates, from the independent certified public accountants of the
Company, addressed to the underwriters, if any, and to Investor making the
request, covering the matters underwriters and Investor may reasonably request,
in which letters the accountants shall state (without limiting the generality of
the foregoing) that they are independent certified public accountants within the
meaning of the 1933 Act and that in their opinion the financial statements and
other financial data of the Company included in the registration statement or
any amendment or supplement thereto comply in all material respects with the
applicable accounting requirements of the 1933 Act

 

4.4 Cooperation
with the Company.
Investor will cooperate with the Company in all respects in connection with this
Article, including timely supplying all information reasonably requested by the
Company (which shall include all information regarding the Investor and proposed
manner of sale of the Shares required to be disclosed in the Registration
Statement) and executing and returning all documents reasonably requested in
connection with the registration and sale of the Shares and entering into and
performing its obligations under any underwriting agreement, if the offering is
an underwritten offering, in usual and customary form, with the managing
underwriter or underwriters of the offering.

 

4.5 Termination
of Registration Rights. The
Company's obligation under Article to register the Shares held by Investor shall
terminate upon the earlier of (i) the date that all of the Shares have been sold
pursuant to the Registration Statement, (ii) the date the Investor receives an
opinion of counsel to the Company, which opinion shall be reasonably acceptable
to the Investor, that the Shares may be sold under the provisions of Rule 144
without limitation as to volume, (iii) the date when all Shares have been
otherwise transferred to persons who may trade the Shares without restriction
under the 1933 Act, and the Company has delivered a new certificate or other
evidence of ownership for the Shares not bearing a restrictive legend, or (iv)
the date when all Shares may be sold without any time, volume or manner
limitations pursuant to Rule 144(k) or any similar provision then in effect
under the 1933 Act in the opinion of counsel to the Company, which counsel shall
be reasonably acceptable to the Investor.

 

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4.6 Indemnification. The
Company agrees to indemnify and hold harmless the Investor against any and all
losses, claims, damages, liabilities and expenses, which Investor may suffer
arising out of any untrue statement of a material fact in a Registration
Statement filed in connection with the registration rights granted under this
Article, or arising out of any omission to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that the Company will not be liable to the extent that
losses, claims, damages, liabilities or expenses arise out of any untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon information relating to the Investor furnished in writing to the
Company by the Investor for use in connection therewith.

 

4.7 Fees
and Commissions. All
underwriting and/or brokerage discounts, fees and commissions in respect of the
registration of the Shares under this Article and applicable transfer taxes
payable upon sale of the Shares, and any counsel fees or disbursements for
counsel for Investor and out-of-pocket expenses of Investor in connection with
the registration of Shares under this Article shall be paid and borne by
Investor.

 

4.8 Registration
Rights of Transferees. The
registration rights granted to Investor pursuant to this Article shall also be
for the benefit of, and enforceable by, any subsequent holder of the Shares,
whether or not any express assignment of those rights to any subsequent holder
is made, so long as the subsequent holder acquires at least fifteen percent
(15%) of the Shares then outstanding.

 

5. Conditions
to Obligations of the Company. The
obligations of the Company under this Agreement are subject to satisfaction of
the following conditions at or prior to the Closing, any of which may be waived
by the Company:

 

5.1 Representations
and Warranties Correct. All of
the representations and warranties of Investor contained in this Agreement shall
be true and correct in all material respects as of the Closing with the same
effect as if made on the date of Closing.

 

5.2 Performance
of Covenants and Agreements. All of
the covenants and agreements of Investor contained in this Agreement and
required to be performed on or before the date of Closing shall have been
performed in all material respects to the reasonable satisfaction of the
Company.

 

5.3 Legal
Action.

 

(a)  There
shall not have been instituted or threatened any legal proceeding seeking to
prohibit the consumma-tion of the transactions contemplated by this
Agreement.

 

(b)  None of
the parties hereto shall be prohibited in any order, writ, injunction or decree
of any governmental body of competent jurisdiction from consummating the
transactions contemplated by this Agreement, and no action or proceeding shall
then be pending which questions the validity of this Agreement, any of the
transactions contemplated hereby or any action which has been taken by any of
the parties in connection herewith or in connection with any of the transactions
contemplated hereby.

 

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6. Conditions
to Obligations of Investor. The
obligations of Investor under this Agreement are subject to satisfaction of the
following conditions at or prior to the Closing, any of which may be waived by
Investor.

 

6.1 Representations
and Warranties Correct. All of
the representations and warranties of the Company contained in this Agreement
shall be true and correct in all material respects as of the Closing with the
same effect as if made on the date of Closing.

 

6.2 Legal
Action.

 

(a)  There
shall not have been instituted or threatened any legal proceeding seeking to
prohibit the consummation of the transactions contemplated by this Agreement, or
to obtain damages from Investor with respect thereto.

 

(b)  None of
the parties hereto shall be prohibited by any order, writ, injunction or decree
of any governmental body of competent jurisdiction from consummating the
transactions contemplated by this Agreement, and no action or proceeding shall
then be pending which questions the validity of this Agreement, any of the
transactions contemplated hereby or any action which has been taken by any of
the parties in connection herewith or in connection with any of the transactions
contemplated hereby.

 

7. Legends. The
certificates evidencing the Shares shall be endorsed with the legend set forth
below, and Investor covenants that Investor shall not transfer the shares
represented by a certificate without complying with the restrictions on transfer
described in the legend endorsed on the certificate:

 

THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE UNITED STATES
SECURITIES AND EXCHANGE COMMISSION UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED, (THE “1933 ACT”) OR THE SECURITIES COMMISSION OF ANY STATE UNDER ANY
STATE SECURITIES LAW. THEY WERE OFFERED PURSUANT TO AN EXEMPTION FROM
REGISTRATION PURSUANT TO SECTION 4(2) OF THE 1933 ACT. THE SHARES MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED UNLESS THE SHARES ARE REGISTERED UNDER
THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IS
OBTAINED WHICH IS REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH OFFERS, SALES
AND TRANSFERS MAY BE MADE PURSUANT TO AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THOSE LAWS.

 

8. Miscellaneous.

 

8.1 Notices. All
notices or other communications given or made hereunder shall be in writing and
given by personal delivery, confirmed facsimile transmission, nationally
recognized overnight courier service (prepaid) or by registered or certified
mail, return receipt requested, postage prepaid if to Investor at 505 Thornall
Street, #304, Edison, New Jersey 08837; Fax: (732) 635-0042, or if to the
Company, at 2415 East Camelback Road, Suite 700, Phoenix, Arizona 85022; Fax:
(602) 508-0115. A party may change its address by written notice in accordance
with this Section.

11

8.2 Construction.
Notwithstanding the place where this Agreement may be executed by any of the
parties hereto, the parties expressly agree that all terms and provisions hereof
shall be governed by and construed in accordance with the laws of the State of
New York without giving effect to the choice or conflict of law principles
thereof.

 

8.3 Entire
Agreement; Amendments and Waiver. This
Agreement and the License Agreement, together with its exhibits, set forth the
entire understanding of the parties with respect to the transactions
contemplated hereby, and neither party shall be bound by or deemed to have made
any representations and/or warranties except those contained herein or therein
or incorporated herein or therein by reference. This Agreement may be amended
only in writing, duly executed by each of the parties.

 

8.4 Successors
and Assigns. Except
as otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
herein.

 

8.5 Nominees
for Beneficial Owners. In the
event that any Shares are held by a nominee for the beneficial owner, the
beneficial owner may, at its election, be treated as the Investor for purposes
of any request or other action or pursuant to this Agreement or any
determination of any number or percentage of Shares held as contemplated by this
Agreement. If the beneficial owner so elects, the Company may require assurances
reasonably satisfactory to it of the beneficial ownership.

 

8.6 Interpretation
and Headings. In this
Agreement words in the singular shall be deemed to include the plural and vice
versa and words identifying gender shall include the masculine, feminine and
neuter, as the context requires. The headings in this Agreement are for
convenience of reference only and shall not be used to interpret or define the
provisions of this Agreement.

 

8.7 Survival
of Representations and Warranties. All
representations and warranties contained herein will survive the execution and
delivery of this Agreement and delivery of and payment for the Shares regardless
of any investigation made by or on behalf of the parties.

 

8.8 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. For purposes of this Agreement, a facsimile signature shall be
treated in all respects as an original.

 

8.9 Severability. If one
or more provisions of this Agreement shall be held to be unenforceable under
applicable law, that provision shall be excluded from this Agreement and the
balance of the Agreement shall be interpreted as if the provision were excluded
and shall otherwise be enforceable in accordance with its terms.

 

12

 

IN
WITNESS WHEREOF, the parties hereby have executed this Agreement as of the date
first set forth above.

 

	NOSTRUM PHARMACEUTICALS, INC.	 	 
	 	 	 
	 	 	 
	/S/
      NIRMAL MULYE, Ph.D.	 	 
	By: Nirmal Mulye, Ph.D.	 	 
	Its: President	 	 
	 	 	 
	BIONUTRICS, INC.	 	 
	 	 	 
	/S/
      RONALD H. LANE, Ph.D.	 	 
	By: Ronald H. Lane, Ph.D.	 	 
	Its: President	 	 

 

13Exhibit
10.63

 

WARNER
PRIVATE PLACEMENT AGREEMENT 

MOVING
BYTES INC.

FINANCING
AGREEMENT

THIS
AGREEMENT MADE EFFECTIVE AS OF THE 15th, day of March, 2005 (the “Effective
Date”).

BETWEEN:

Moving
Bytes Inc., a
Canada Business Corporations Act company;

(the
“Company”),

Warner
Technology and Investments Corp., a New Jersey corporation (the
“Purchaser”)

AND:

Guzov
Ofsink, LLC (the “Escrow Agent”).

WHEREAS:

	 	
      A.
      
	
      The
      Purchaser has subscribed for Shares of the Company in accordance with a
      Subscription Agreement entered into by and between the parties hereto
      concurrent with this Agreement and of which this Agreement is a part;
      and

	 	
      B.
      
	
      The
      parties have agreed that the financing terms and conditions of the
      Subscription and the Purchaser’s investment in the Company shall be
      governed by this Agreement;

NOW,
THEREFORE, THIS AGREEMENT WITNESSES that in consideration of the mutual
covenants and agreements hereto contained, the receipt of which is hereby
acknowledged, the parties covenant and agree with each other as
follows:

1.
Subscription for Capital Stock. 

1.1
 a.
Purchaser agrees to purchase Shares of Company as follows:

i) One
Hundred Thirty-nine Million Two Hundred Forty-six Thousand Sixty-five
(139,246,065) Shares at a subscription price of Seventy Thousand dollars US
($70,000 USD) or $0.0005027 per share, 

b.
Purchaser shall be obligated to purchase the Shares immediately upon execution
of this Agreement and shall fund the purchase of Shares by depositing the entire
subscription price in escrow with the Escrow Agent pursuant to the provisions of
Section 3 of this Agreement and directing the Escrow Agent to immediately make
the following payments: 

	i)  	
      A
      check or wire transfer in the amount of Five Thousand dollars US
      ($5,000.00 USD) to Bagell , Josephs & Company, LLC on behalf of the
      Company for payment in regard to the preparation of the Company’s annual
      audit for its fiscal year ended December 31, 2004, with evidence of such
      payment to be provided to the Company under the following
      instructions:

Bagell,
Josephs & Company, LLC

Attn:
Neil Levine

200
Haddonfield Berlin Road

Suite
400-403

Gibbsboro,
NJ 08026

Tel:
856-346-2828 

;
and

	ii)  	
      a
      wire transfer of Five Thousand dollars US ($5,000 USD) to G2 Solutions,
      LLC on behalf of the Company for full payment in regard to the preparation
      of the Company’s books, working papers, schedules and financial statements
      for its fiscal year ended December 31, 2004, with evidence of such payment
      to be provided to Seller, under the following
  instructions:

G2
Solutions, LLC Tax Account

Wells
Fargo Bank, Emeryville, CA  94608

ABA
Routing #    121042882

Account
#    9688983783

Tel.
510.406.1070

;
and

 

	iii)  	
      a
      wire transfer of Fifteen Thousand dollars US ($15,000 USD) to Securities
      Compliance, Inc. on behalf of the Company for payment of one-half of the
      total amount payable by the Company under an agreement entered into by the
      Company and Securities Compliance, Inc. in regard to the termination of
      prior agreements between the Company and Securities Compliance, Inc. and
      the preparation of SEC filings related to this Agreement and the Company’s
      Form 10-KSB for its fiscal year ended December 31, 2004, under the
      following instructions:

Securities
Compliance, Inc.

Wells
Fargo Bank, Northgate Branch, San Rafael, Ca 94903

ABA
Routing # 121000248

Account
#     0734561947

Tel.
415.446.5546

;
and

	iv)  	
      a
      wire transfer of Ten Thousand dollars US ($10,000 USD) to the Company,
      with the following instructions:

Moving
Bytes Inc.

Wells
Fargo Bank, Northgate Branch, San Rafael, Ca 94903

ABA
Routing # 121000248

Account
# 1659298119

Tel.
415.446.5546

1.2  Immediately
upon execution of this Agreement the Company is depositing with the Escrow Agent
certificates for an aggregate of One Hundred Thirty-nine Million Two Hundred
Forty-six Thousand Sixty-five (139,246,065) Shares in the following
denominations: 9,946,148 Shares, 9,946,148 Shares, 9,946,147 Shares, 9,946,147
Shares, 29,838,443 Shares, 29,838,442 Shares, 19,892,295 Shares and 19,892,295
Shares. 

1.3
Subject to applicable securities laws, the Shares referred to hereto, shall be
issued on a private placement basis and shall be subject to a minimum one year
holding period.

1.4
Simultaneously with or before the execution of this Agreement, the board of
directors of the Company shall appoint two nominees of Purchaser to the
Company’s board of directors and the current members of the board of directors,
with the exception of Thomas Wharton and Ming Liu shall resign from the
Company’s board of directors.The election of the two nominees of the Purchaser
shall be effective only if, and ten days after, the Company both files with the
Securities and Exchange Commission an Information Statement prepared in
accordance with Schedule 14f-1 and disseminates such information statement to
its stockholders of record.

1.5 After
the consummation of this Agreement, the Purchaser contemplates causing the
Company to enter into a share exchange agreement with the shareholders of a
Chinese operating company (the “Share Exchange Agreement”). As a result of the
consummation of this Agreement and the Share Exchange Agreement, the
stockholders of the Company who are stockholders immediately prior to the
execution of this Agreement, shall immediately after the consummation of the
Share Exchange Agreement own 5.00% of the outstanding shares of common stock of
the Company. Nothing herein shall be deemed to require the Company to enter into
any transaction with any person after the consummation of this
Agreement.

2. Representations
of the Company.

The
Company hereby represents and warrants to Purchaser as follows:

2.1. Corporate
Organization.

The
Company is duly formed, validly existing and in good standing under the Canada
Business Corporations Act.

 

2.2 Authorization.

The
Company has full power and authority (i) to execute, deliver and perform this
Agreement and all other documents, instruments and agreements required to be
executed, delivered and performed by it in connection with the transactions
contemplated by this Agreement and (ii) to sell and issue the Shares. All action
on the part of the Company and its officers, directors and stockholders
necessary for the authorization, execution, delivery and performance by the
Company of all of the Company’s obligations under this Agreement and for the
sale and issuance of the Shares has been taken or will be taken prior to the
Closing. This Agreement, when executed and delivered by the Company will
constitute the legally binding and valid obligations of the Company, enforceable
against it in accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, moratorium, creditors’ rights and other
similar laws.

2.3. Capitalization.

Immediately
prior to the execution of this Agreement, the Company had an unlimited number of
authorized common stock, no par value, 10,000,000 shares of Class A Preferred
Stock, no par value and 20,000,000 shares of Class B Preferred Stock, no par
value and there were 36,203,977 shares of Common Stock and no shares of Class A
Preferred Stock outstanding and no shares of Class B Preferred Stock
outstanding. There are no commitments to issue and there are no outstanding
warrants, options, convertible securities or debt, preferred stock, or any other
securities except for 470,000 common stock options. In addition, there are no
conversion or exchange privileges, preemptive rights, or other rights or
agreements to purchase or otherwise acquire or issue any securities of the
Company, and there is no agreement or understanding between any persons and/or
entities, which affects or relates to the voting or giving of written consents
with respect to any security of the Company or any instrument or security
exercisable or exchangeable for, or convertible into any security of the
Company, other than as set forth in the convertible note agreement with
Innerloop Mobile Communications A.S.

2.4. Validity
of Shares.

The
Shares, when issued, sold and delivered in accordance with the terms and for the
consideration expressed in this Agreement, shall be duly and validly issued,
fully paid and nonassessable, and free and clear of all liens, encumbrances and
restrictions on transfer of every kind and nature whatsoever, other than
restrictions on transfer imposed on Purchaser under applicable state and federal
securities laws. The issuance, sale and delivery of the Shares is not subject to
any preemptive right, right of first refusal or other similar right in favor of
any person, other than as may be set forth in the convertible note agreement
with Innerloop Mobile Communications A.S.

2.5. No
Conflict with Other Instruments.

The
execution, delivery and performance by the Company of this Agreement, and the
consummation of the transactions contemplated hereby, will not result in any
violation of, conflict with, result in a breach of, constitute a default under,
result in the acceleration of, create in any party the right to accelerate,
terminate, modify or cancel, or require any notice under, with or without the
passage of time or the giving of notice, or both, (i) any provision of the
Company’s Certificate of Incorporation or By-laws (each as may have been
amended, supplemented or restated); (ii) any provision of any judgment, writ,
injunction, decree or order to which the Company is a party; or (iii) any law,
statute, rule or regulation applicable to the Company.

2.6. Governmental
Consents.

No
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local
governmental authority on the part of the Company is required in connection with
(i) the execution, delivery and performance this Agreement, and (ii) the
issuance, sale and delivery of the Shares, except for such filings required
pursuant to applicable federal and state securities laws and blue sky laws,
which filings, if any, will be effected by the Company within the required
statutory period.

2.7. No
Defaults or Violations.

The
Company is not in violation of, in conflict with, in breach of or in default
under any term or provision of, and no right of any party to accelerate,
terminate, modify or cancel has come into existence under, (i) its Certificate
of Incorporation or By-laws (each as may have been amended, supplemented or
restated), (ii) any provision of any judgment, writ, injunction, decree or order
to which the Company is a party. Immediately prior to the execution of this
Agreement there were no outstanding orders from any regulatory authority halting
the issuance or trading in any securities of the Company except for cease trade
orders in the provinces of British Columbia and Alberta, Canada. 

2.8. Private
Offering.

Subject
to the truth and accuracy of Purchaser’s representations set forth in the
Subscription Agreement between the Company and the Purchaser and in this
Agreement, the offer and sale of the Shares, as contemplated by this Agreement
will be made in reliance on one or more exemptions from the registration
requirements of the Securities Act of 1933, as amended (the “Securities Act”),
and the qualification or registration requirements of applicable blue sky
laws.

2.9. Litigation.

There is
no action, suit, proceeding or investigation pending or, to the best knowledge
of the Company, currently threatened, against the Company that may affect the
validity of this Agreement or the right of the Company to enter into this
Agreement or to consummate the transactions contemplated hereby. There is no
action, suit, proceeding or investigation pending or, to the best knowledge of
the Company, currently threatened, against the Company, before any court or by
or before any governmental body or any arbitration board or tribunal, nor is
there any judgment, decree, injunction or order of any court, governmental
department, commission, agency, instrumentality or arbitrator against the
Company. The Company is not a party or subject to the provisions of any order,
writ, injunction, judgment or decree of any court or government agency or
instrumentality. There is no action, suit, proceeding or investigation by the
Company currently pending or which the Company intends to initiate. When any
reference to the “knowledge” or “best knowledge” of the Company is made in this
Agreement, such terms shall mean the knowledge that would be gained from due
inquiry into the matters referenced.

2.10. Brokers’
Fees and Commissions.

Neither
the Company nor any of its officers, directors, employees, stockholders, agents
or representatives has employed any investment banker, broker, or finder in
connection with the transactions contemplated by this Agreement and no such
person or entity is entitled to a fee with respect to the transactions
contemplated by this Agreement.

2.11. Full
Disclosure.

The
Company has fully provided or made available to Purchaser all the information
that Purchaser has requested for deciding whether to purchase the Shares. The
information so provided to Purchaser by the Company does not contain any untrue
statement of a material fact. 

3.
 Escrow
Provisions.

3.1. Appointment
of Escrow Agent. The
Purchaser and the Company hereby appoint Escrow Agent as escrow agent in
accordance with the terms and conditions set forth herein, and the Escrow Agent
hereby accepts such appointment.

3.2. Delivery
of Funds and Certificates to Escrow Agent. Upon
the execution of this Agreement, the Purchaser is depositing the entire
subscription price (the “Escrowed Funds”) with the Escrow Agent and the Company
is depositing the certificates (the “Escrowed Certificates”) for the Shares (the
Escrowed Shares”) referred to in Section 1.2 with the Escrow Agent
..

3.3. Escrow
Agent to Hold and Disburse Escrowed Funds and Escrowed
Certificates. The
Escrow Agent will hold and disburse all Escrowed Funds, Escrowed Shares and
Escrowed Certificates received by it pursuant to the terms of this Escrow
Agreement, as follows:

3.3.1.
Immediately upon the execution of this Agreement, the Escrow Agent shall make
the wire transfers set forth in Section 1.1(b) and deliver to the Purchaser
certificates totalling for 69,623,033 Shares.

3.3.2
Promptly upon the filing by the Company of its Annual Report on Form 10-KSB for
the fiscal year ended December 31, 2004, the Escrow Agent shall wire transfer
(in accordance with the wire transfer instructions set forth in Section
1(b)(iii) Fifteen Thousand Dollars to Securities Compliance, Inc. on behalf of
the Company for payment of the remaining one-half of the total amount payable by
the Company under an agreement entered into by the Company and Securities
Compliance, Inc. and deliver a certificate for 29,838,442 Shares to the
Purchaser.

3.3.3 Promptly
after receipt of any other written instructions signed by the Company and the
Purchaser, the Escrow Agent shall disburse Escrowed Funds and deliver Escrowed
Shares in an amount equivalent to the Escrowed Funds disbursed divided by
0.0005027072. The Company and Purchaser authorize the Escrow Agent to divide the
Escrowed Certificates as necessary to perform its obligations under this Section
3.3.3, each of which newly issued certificate shall itself be an “Escrowed
Certificate”. The Company agrees to authorize and instruct its transfer agent,
Pacific Corporate Trust Company, to divide Escrowed Certificates into new
certificates as may be requested by the Escrow Agent. At such time as the
Company has filed its Annual Report on Form 10-KSB for the fiscal year ended
December 31, 2004 or on April 15, 2005, whichever should occur first, the Escrow
Agent shall disburse the remaining balance of the Escrowed Funds to the Company,
less all interest earned on the Escrowed Funds from the inception of this
Agreement and deliver the remaining Escrowed Certificates to the Purchaser. The
Escrow Agent shall also send a check for the interest on the Escrowed Funds to
the Purchaser.

3.3.4 All the
funds received by the Escrow Agent pursuant to the terms of this Agreement may
be held in a bank IOLA account which is a non-interest bearing
account.

3.4
 The
Escrow Agent shall have no duties or responsibilities other than those expressly
set forth herein. The Escrow Agent shall have no duty to enforce any obligation
of any person to make any payment or delivery, or to direct or cause any payment
or delivery to be made, or to enforce any obligation of any person to perform
any other act. The Escrow Agent shall be under no liability to the other parties
hereto to anyone else, by reason of any failure, on the part of any party hereto
or any maker, guarantor, endorser or other signatory of any document or any
other person, to perform such person’s obligations under any such document.
Except for amendments to this Agreement, and except as provided in Section 3.3,
the Escrow Agent shall not be obligated to recognize any instructions or
agreement between any and all of the persons referred to herein, notwithstanding
that references hereto may be made herein and whether or not it has knowledge
thereof. 

3.5 The
Escrow Agent shall not be liable to the parties hereto or to anyone else for any
action taken or omitted by it, or any action suffered by it to be taken or
omitted, in good faith and acting upon any order, notice, demand, certificate,
opinion or advice of counsel (including counsel chosen by the Escrow Agent)
statement, instrument, report, or other paper or document (not only as to its
due execution and the validity and effectiveness of its provisions, but also as
to the truth and acceptability of any information therein contained), which is
believed by the Escrow Agent to be genuine and to be signed or presented by the
proper person or persons. The Escrow Agent shall not be bound by any of the
terms thereof, unless evidenced by a writing delivered to the Escrow Agent
signed by the proper party or parties and, if the duties or rights of the Escrow
Agent are affected, unless it shall give its prior written consent thereto.

3.6 The
Escrow Agent shall not be responsible for the sufficiency or accuracy of the
form, or of the execution, validity, value or genuineness of, any document or
property received, held or delivered by it hereunder, or of any signature or
endorsement thereon, or for any lack of endorsement thereon, or for any
description therein; nor shall the Escrow Agent be responsible or liable to the
other parties hereto or to anyone else in any respect on account of the
identity, authority or rights, of the person executing or delivering or
purporting to execute or deliver any document or property or this agreement. The
Escrow Agent shall have no responsibility with respect to the use or application
of any funds or other property paid or delivered by the Escrow Agent pursuant to
the provisions hereof. 

3.7 The
Escrow Agent shall have the right to assume, in the absence of written notice to
the contrary from the proper person or persons, that a fact or an event, by
reason of which an action would or might be taken by the Escrow Agent, does not
exist or has not occurred, without incurring liability to the other parties
hereto or to anyone else for any action taken or omitted, or any action suffered
by it to betaken or omitted, in good faith and in the exercise of its own best
judgment, in reliance upon such assumption. 

3.8
 To the
extent that the Escrow Agent becomes liable for the payment of taxes, including
withholding taxes, in respect of income derived from the investment of funds
held hereunder or any payment made hereunder, the Escrow Agent may pay such
taxes. The Escrow Agent may withhold from any payment of monies held by it
hereunder such amount as the Escrow Agent estimates to be sufficient to provide
for the payment of such taxes not yet paid, and may use the sum withheld for
that purpose. The Escrow Agent shall be indemnified and held harmless against
any liability for taxes and for any penalties in respect of taxes, on such
investment income or payments in the manner provided in Section 3.9.

3.9
 The
Escrow Agent will be indemnified and held harmless by the Company and the
Purchaser from and against all expenses, including reasonable counsel fees and
disbursements, or loss suffered by the Escrow Agent in connection with any
action, suit or proceeding involving any claim, or in connection with any claim
or demand, which in any way, directly or indirectly, arises out of or relates to
this Agreement, the services of the Escrow Agent hereunder, the monies or other
property held by it hereunder. The Escrow Agent shall have a lien for the amount
of any such expense or loss on the monies and any other property held by it
hereunder and shall be entitled to reimburse itself from such monies or property
to the amount of any such expense or loss. Promptly after the receipt of the
Escrow Agent of notice of any demand or claim or the commencement of any action,
suit or proceeding, the Escrow Agent shall, if a claim in respect thereof is to
be made against the Company and/or the Purchaser, notify the proper party in
writing, but the failure by the Escrow Agent to give such notice shall not
relieve the any party from any liability which it may have to the Escrow Agent
hereunder. Notwithstanding any obligation to make payments and deliveries
hereunder, the Escrow Agent may retain and hold for such time as it deems
necessary such amount of monies or property as it shall, from time to time, in
its sole discretion, deem sufficient to indemnify itself for any such loss or
expense.

3.10
 The
Escrow Agent may resign at any time and be discharged from its duties as Escrow
Agent hereunder by giving the parties at least 10 days’ written notice thereof.
As soon as practicable after its resignation, the Escrow Agent shall turn over
to a successor escrow agent appointed by the Company and the Purchaser all
monies and properties held hereunder (less such amount as the Escrow Agent
entitled to retain) upon presentation of the document appointing the new escrow
agent and its acceptance thereof. If no new agent is so appointed within the
60-day period following such notice of resignation, the Escrow Agent may deposit
the aforesaid monies and property with any court it deems appropriate.

3.11 Any
payments by the Escrow Agent pursuant to the terms of the Agreement shall be
made by check or wire transfer. 

3.12 All
amounts referred to herein are expressed in United States Dollars and all
payments by the Escrow Agent shall be made in such dollars. 

4.
 Term and
Termination. 

	
      4.1
      
	
      This
      Agreement shall commence on the Effective Date of this Agreement.
      

5.
 Notices.

	
      5.1
	
      Any
      demand, notice or other communication (a “Notice”) to be given in
      connection with this Agreement shall be given in writing and may be given
      by personal delivery or by registered mail addressed to the recipient as
      follows:

To Moving
Bytes:               Secretary
of the Corporation

Mark
Smith

4340
Redwood Hwy. Ste. F222

San
Rafael, Ca 94903

 

To
Purchaser:              
        Warner
Technology and Investments Corp.

100 Wall
Street, 15th
Floor 

New York,
New York 10005

To Escrow
Agent:               
Guzov
Ofsink, LLC

600
Madison Avenue, 14th
Floor

New York,
New York 10022

Attention:
Darren Ofsink, Esq.

	
      
	
      or
      such other address or individual as may be designated by notice by either
      party to the other. Any Notice given by personal delivery shall be deemed
      to have been given on the day of actual delivery thereof and, if made or
      given by registered mail, on the fifth day following the deposit thereof
      in the mail.

6.
 Miscellaneous.

	
      6.1
      
	
      The
      Subscription Agreement and the terms and provisions hereto contained
      constitute the entire agreement between the parties and supersede all
      previous oral or written communications.

	
      6.2
      
	
      This
      Agreement shall be governed by, construed and enforced in accordance with
      the laws of the state of California without giving effect to conflicts of
      law principles, and the parties hereto submit and attorn to the exclusive
      jurisdiction of the courts of the state of
California.

	
      6.3
      
	
      In
      the event any provision of this Agreement shall held for any reason to be
      invalid, illegal or unenforceable, such provision shall be deemed amended
      or deleted only to the extent necessary to bring it within the
      requirements of the law, and shall not affect the validity of the
      remaining provisions hereof.

	
      6.4
	
      The
      prevailing party in any court action over this Agreement shall be entitled
      to recover from the other party its’ attorneys fees, costs and expenses in
      connection therewith, or on any appeal
therefrom.

IN
WITNESS WHEREOF this agreement has been executed as of the day and year first
above written.

Warner
Technology and Investments Corp.

/s/
HuaKang Zhou

Name:
HuaKang Zhou

Title:
Chairman

Moving
Bytes Inc.     Moving
Bytes Inc.

 

/s/Mark
M.
Smith                                            
           /s/ J. Erik
Mustad

Mark M.
Smith, President     J. Erik
Mustad, Chief Executive Officer

Guzov
Ofsink, LLC

/s/ Darren
Ofsink

Name:
Darren Ofsink

Title:
Member

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]