Document:

ex_10-3.htm

    
      

      

    

    Exhibit 10.3

     

    
      
        Exhibit
10.3 Convertible Secured Promissory Note dated June 22, 2009, between the
Company and Margaret Wong

        

        THIS
CONVERTIBLE PROMISSORY NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER ANY
SECURITIES LAWS OF ANY STATE.  THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH
ACT OR ANY SUCH LAW.

         

        CONVERTIBLE SECURED
PROMISSORY NOTE

        (Due:
June 21, 2011)

        

         

        
          	$100,000 	
                   June 22,
      2009

                

        

        Davis,
California

         

        FOR VALUE
RECEIVED, the undersigned, Octus, Inc., a Nevada corporation (the “Company”)
promises to pay to the order of Margaret Y. Wong, or permitted assigns
(hereinafter, with any subsequent holder, the “Holder”)
the principal sum of $100,000, with interest on the unpaid principal from the
date hereof at a rate of ten percent (10.0%) simple interest per
annum.  Interest shall be calculated on the basis of the actual number
of days elapsed over a 365-day year, shall commence to accrue on the date hereof
and shall continue on the outstanding principal until paid in full.

         

        1.           Interest
Payments.  Accrued unpaid interest shall be paid semi-annually,
and upon the Maturity Date, with the first payment due six months after the date
on which the Note is issued.  At the Company’s option, the Company may
make any interest payment either in cash or by delivery of a number of shares of
the Company’s Common Stock (“Common
Stock”) with a value equal to the amount of interest due and payable,
calculated by the greater of fifteen cents ($0.15) per share or at seventy
percent (70%) of the average closing price of the Common Stock on the OTC
Bulletin Board (or whatever exchange, market or quotation system the Common
Stock is then traded), for the ten (10) trading days ending three days before
the date that such payment is due.

         

        2.           Application of
Payments.  All payments of principal and interest shall be in
lawful money of the United States of America, except as set forth below in
connection with conversion of this Note.  All payments on account of
the indebtedness evidenced by this Note shall be applied first to any and all
costs, expenses and other charges then owed the Holder by the Company, second,
to accrued and unpaid interest, and thereafter to the unpaid principal balance
hereof.   All payments so received after demand or acceleration
shall be applied in such manner as the Holder may determine in its sole and
absolute discretion.

         

        3.           Maturity Date. Unless
this Note has been converted pursuant to the terms of this Note or unless
earlier accelerated by the terms of this Note, the principal amount hereof,
together with all unpaid accrued interest hereon and all other fees, costs and
charges, if any, shall be due and payable on the date which is twenty-four (24)
months from the original date of this Note (the “Maturity
Date”).  No payments of principal or interest are required
hereunder until the Maturity Date, except as otherwise provided
herein.

         

        4.           Prepayment. Before
the Maturity Date, the Company may prepay this Note, in whole or in part, at any
time without penalty, upon five (5) days advance notice to the
Holder.  If the Company delivers such a notice to the Holder, then the
Holder may elect, within such five-day period, to convert the Note into the
Underlying Securities based on the provisions of Section 5(b).

         

        5.           Conversion The
principal amount of this Note and all unpaid interest accrued on this Note
(together, sometimes referred to as the “Note
Balance”) may be converted, as follows:

         

        (a)           Upon a Qualified
Financing.  If the Company sells its equity securities in a
transaction after the latest date on which this Note is issued, for aggregate
gross proceeds to the Company (excluding cancellation of indebtedness under this
Note and any additional notes or existing convertible debt of the Company) of at
least One Million Dollars ($1,000,000) (a “Qualified
Financing” and the securities sold in such financing referred to as
“Financing
Securities”), then all outstanding indebtedness under this Note shall
automatically be converted (regardless of whether the Note is surrendered to
Company) into shares of the Financing Securities at a conversion price per share
equal to seventy percent (70.0%) of the price per share paid for the Financing
Securities in the Qualified Financing (“Financing
Securities Price”).  At the closing of the Qualified Financing,
the Holder shall become a party to, and be entitled to the same rights under,
all agreements to which all other investors in the Qualified Financing become a
party, and shall receive the same benefits bestowed upon such other
investors.

         

        i.      Notice.  In
connection with automatic conversion of this Note, the Company shall deliver
notice to the Holder of any conversion to be effected hereunder, specifying the
applicable conversion price and the amount of principal and interest of the Note
to be converted.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        ii.      Execution of Investor
Agreements.  As a condition precedent to the issuance of
Financing Securities to Holder upon such conversion, Holder shall execute and
deliver such agreements, instruments and other documents as are executed and
delivered by the other investors in connection with their purchase of the
Financing Securities.

         

        OR,

        

        (b)           Conversion at the Option of
the Holder.  At any time commencing ninety (90) days after the
date of issuance of this Note and before the Maturity Date or earlier conversion
of this Note, the Holder, at Holder’s option and upon five (5) days prior
written notice to the Company, may convert in whole or in part the outstanding
principal and accrued but unpaid interest of this Note (the amount to be
converted referred to as the “Note
Amount”) into a number of shares of Common Stock (sometimes referred to
as the “Underlying
Securities”) determined by the greater of fifteen cents ($0.15) per share
or at seventy percent (70%) of the average closing price of the Common Stock on
the OTC Bulletin Board (or whatever exchange, market or quotation system the
Common Stock is then traded), for the ten (10) trading days ending five (5) days
before the conversion date.

         

        6.           Mechanics of
Conversion.  As promptly as practicable after the conversion of
this Note, this Note shall be cancelled, and the Company will issue and deliver
to the Holder a certificate or certificates representing the full number of
securities issuable upon such conversion (and the issuance of such certificate
or certificates shall be made without charge to the Holder of the Note for any
issuance tax in respect thereof or other cost incurred by Company in connection
with such conversion and the related issuance of shares).

         

        7.           Security
Interest.  The Holder is granted a general security interest in
all assets of the Company ranking before all Preferred and Common Shareholders
and subordinated to the existing Senior Convertible Debt, as referenced in the
Company’s annual reports on Form 10-K and quarterly reports on Form 10-Q that
the Company files with the Securities and Exchange Commission as of March 31,
2009. The Company hereby agrees to file and execute any documents necessary to
establish and protect this security interest, including, but not limited to,
execution of financing statements.

         

        8.           Merger, Sale of Assets,
etc.  In the event that Company sells or otherwise disposes of
all or substantially all of its assets or is acquired by way of a merger,
consolidation, reorganization or other similar transaction or series of
transactions (but excluding any equity financing transaction by Company
involving issuance of its equity securities to investors primarily for purposes
of financing Company’s business) pursuant to which stockholders of Company prior
to such acquisition own less than fifty percent (50%) of the surviving or
resulting entity, then, the Note shall, immediately before the closing of any
such transaction, convert into Underlying Securities in the same manner as if
the Holder had elected to convert the Note into Underlying Securities upon the
closing of the transaction.

         

        9.           Default.  The
Company will be in default if any of the following occurs: (a) the Company fails
to make payment of the principal amount or an interest payment when due and
fails to cure the default within ten (10) days of the date of delivery of notice
from Holder to the Company of the default; and/or (b) the Company fails in any
material respect to comply with or to perform when due any other material term,
obligation, covenant, or condition contained in this Note and fails to cure the
default within ten (10) days of the date of delivery of notice from Holder to
the Company of the default.  Upon default, Holder may declare the
entire unpaid principal and accrued interest amount immediately due. If Holder
prevails in a lawsuit to collect on this Note, the Company will pay Holder's
costs and attorneys’ fees in an amount the court finds to be reasonable. Further
the Company will accrue a penalty fee of 1.5% per month on any payment that is
in default as defined herein.

         

        10.         Issuance of Warrant to
Holder. As an inducement for making the loan described herein, the
Company has agreed to issue to Holder a Warrant to purchase a number of shares
of Common Stock equal to 3,500 shares of Common Stock for each $1,000 of
principal amount (the “Warrant
Shares”), exercisable at one cent ($0.01) per share.

         

        11.         Piggyback Registration
Rights.

         

        (a)           So
long as shares of the Company’s Common Stock received by the Holder hereunder
upon conversion of the Note or upon the exercise of the Warrant Shares are
“restricted securities” under the Act, and during such period, if the Company
files a registration statement pursuant to the Act relating to an offering for
its own account or for the account of others under the Act of any of its equity
securities (other than on Form S-4 or Form S-8 (each as promulgated under the
Act) or their then equivalents), then the Company will promptly give to Holder
written notice thereof (which will include a list of the jurisdictions in which
the Company intends to attempt to qualify such securities under the applicable
blue sky or other state securities laws); and will, subject to the provisions
below, include in such registration and any related qualification under blue sky
laws or other compliance), and in any underwriting involved therein, all of the
Warrant Shares and any shares of Common Stock that are issuable upon conversion
of the Note specified by Holder in a written request delivered to the Company
within 15 days after such written notice from the Company.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        (b)           If
the Company requests, Holder shall execute such customary agreements and
instruments as other security holders whose securities are included in such
registration execute in connection with the inclusion of securities in such
registration.  Holder agrees to provide such information and execute
such instruments as the Company reasonably requests relating to the preparation
of any such registration statement and the inclusion of information concerning
Holder in the registration statement.  All fees and expenses incident
to the performance of or compliance with the filing of the registration
statement shall be borne by the Company whether or not any registrable
securities are sold pursuant to the registration statement. The fees and
expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with the OTC
Bulletin Board or other exchange or quotation service on which the Common Stock
of the Company is then listed for trading, and (B) in compliance with applicable
state securities or Blue Sky laws), (ii) printing expenses (including, without
limitation, expenses of printing certificates for registrable securities and of
printing prospectuses if the printing of prospectuses is reasonably requested by
the holders of a majority of the registrable securities included in the
registration statement), (iii) messenger, telephone and delivery expenses, (iv)
fees and disbursements of counsel for the Company, (v) Act liability insurance,
if the Company so desires such insurance, and (vi) fees and expenses of all
other persons retained by the Company in connection with the filing of the
registration statement. In addition, the Company shall be responsible for all of
its internal expenses incurred in connection with the filing of the registration
statement (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit and the fees and expenses incurred in connection with the
listing of the registrable securities on any securities exchange, if applicable.
In no event shall the Company be responsible for any broker or similar
commissions or, except to the extent provided for hereunder, any legal fees or
other costs of the Holder.

         

        12.           Miscellaneous

         

        (a)           Reservation of
Shares.  Company shall at all times reserve and keep available
out of its authorized but unissued shares sufficient shares to effect the
conversion of the Note.

         

        (b)           Successors and
Assigns.  Subject to the restrictions on transfer set forth
above, the rights and obligations of Company and the Holder of this Note shall
be binding upon and benefit the successors, assigns, heirs, administrators and
transferees of the parties.

         

        (c)           Assignment.  This
Note shall not be assignable by the Holder without prior written consent of
Company.

         

        (d)           Waivers.  The
terms of this Note shall be construed in accordance with the laws of the State
of California applicable to contracts entered into in California by California
residents and wholly to be performed within California.

         

        (e)           Amendment or Waiver.    Any
term of this Note may be amended or waived with the written consent of Company
and Holder.  Any amendment or waiver effected in accordance with this
Section shall be binding upon Holder at the time outstanding, each future Holder
of any Note and the Company.

         

        (f)           Notices. Any notice
required or permitted under this Note shall be given in writing and shall be
deemed effectively given (i) at the time of personal delivery, if delivery
is in person; (ii) one (1) business day after deposit with an express
overnight courier for United States deliveries, or two (2) business days after
such deposit for deliveries outside of the United States, with proof of delivery
from the courier requested; (iii) three (3) business days after deposit in
the United States mail by certified mail (return receipt requested) for United
States deliveries when addressed to the party to be notified; or (iv) one
(1) business day after transmission by telecopier with confirmation of
successful transmission.  Notices shall be delivered (i) if to the
Holder, to the address and contact information for Holder set forth in the
Company’s books and records, and (ii) if to the Company, to 719 Second Street,
Suite 9, Davis, CA 95616, attention: Chief Executive Officer, or at such other
address as any party may designate by giving written notice to the other
party.

         

        (g)           Severability.  In
the event any one or more of the provisions contained in this Note shall, for
any reason, be held to be invalid, illegal, or unenforceable in whole or in part
or in any respect, or in the event any one or more of the provisions of this
Note operate or would prospectively operate to invalidate this Note, such
invalidity, illegality, or unenforceability shall not affect any other provision
of this Note.  In such instance, this Note shall be construed as if
such invalid, illegal, or unenforceable provision had never been contained
herein and the remaining provisions of this Note shall remain operative and in
full force and effect and in no way shall be affected, prejudiced or disturbed
thereby.

         

        (h)           Delays or
Omissions.  No delay or omission on the part of the Holder in
exercising any right under this Note shall operate as a waiver of such right or
of any other right of the Holder, nor shall any delay, omission or waiver on any
one occasion be deemed a bar to or waiver of the same or any other right on any
future occasion.

         

        (i)           Headings.  The
headings in this Note are for convenience of reference only and shall not define
or limit any terms or provisions hereof.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        (j)           Entire Agreement.
This Note constitutes the entire agreement between the parties, and no party
shall be liable or bound to any other party in any manner by any warranties,
representations, or covenants except as specifically set forth herein or
therein.

         

        (k)           Adjustment for Stock Splits,
Stock Dividends, Recapitalizations, etc.  The number of
shares of stock issuable upon conversion of this Note shall be proportionally
adjusted to reflect any stock dividend, stock split, reverse stock split,
reclassification, recapitalization or other similar event affecting the number
of outstanding shares of common stock.

         

        (l)           Investment
Representations.  Holder makes the representations, warranties
and covenants set forth on Exhibit A attached
hereto, all of which are incorporated herein by reference.

         

        (m)           Risk
Factors.  Holder acknowledges having received and reviewed a
copy of the Company’s most recent annual report on Form 10-K filed with the
Securities and Exchange Commission (the “SEC”),
including without limitation the “Risk Factors” section of the Form 10-K, and
reports that the Company has filed with the SEC since the date of the Form
10-K.  The Holder acknowledges that the investment in the Company
represented by the Note and the Warrant Shares is highly risky.  Due to
these factors, and others described in such documents, the purchase of the
Securities offered hereby involves an extreme degree of risk. The Securities
should only be purchased by Investors who can afford to sustain a total loss of
their investment and who have no need for liquidity with respect to this
investment.

         

        (n)           No Tax Representations.
Holder represents, warrants and acknowledges that Holder is not relying
on the Company for any tax advice concerning the federal or state income or
other tax consequences of this Note or the other securities contemplated by this
Note, and that the Holder has consulted such advisors as Holder deems necessary
or appropriate to understand the tax consequences of the investment represented
by this Note.

         

        

         

        [Remainder
of page intentionally left blank]

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        IN
WITNESS WHEREOF, Company has caused this Note to be signed in its name as of the
date first above written.

         

        
          
            
              
                
                  	 	 	 	Octus, Inc.	 
	 	 	 	 	 
	
                           

                        	 	
                          By:  

                        	
                          /s/
      Chris Soderquist

                        	 
	
                           

                        	 	 	
                          Name:
      Chris Soderquist

                          Title: Chief Executive Officer

                        	 

                

              

            

          

        

        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	 	 	 	 	 
	 	 	 	 	 
	 	 	 	HOLDER	 
	 	 	 	 	 
	
                                           

                                        	 	
                                          By:
       

                                        	
                                          /s/
      Margaret Wong

                                        	 
	
                                           

                                        	 	 	
                                          Its: 

                                        	 

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
A

        INVESTMENT
REPRESENTATIONS

         

        REPRESENTATIONS
AND WARRANTIES OF THE HOLDER

         

        Holder
represents to the Company individually as follows:

         

        
          	
                   
      

                	
                  Purchase for Own
      Account.  Holder represents that it is acquiring the
      Note, any shares of Common Stock or other securities that are issuable
      upon conversion of the Note, and the Warrant Shares (collectively, the
      “Securities”)
      solely for its own account and beneficial interest for investment and not
      for sale or with a view to distribution of the Securities or any part
      thereof, has no present intention of selling (in connection with a
      distribution or otherwise), granting any participation in, or otherwise
      distributing the same, and does not presently have reason to anticipate a
      change in such intention.

                

        

         

        
          	
                   
      

                	
                  Information and
      Sophistication.  Holder acknowledges that Holder has
      received all the information that Holder has requested from the Company
      and that Holder considers necessary or appropriate for deciding whether to
      acquire the Securities.  Holder represents that Holder has had
      an opportunity to ask questions and receive answers from the Company
      regarding the terms and conditions of the offering of the Securities and
      to obtain any additional information necessary to verify the accuracy of
      the information given the Holder.  Holder has such knowledge and
      experience in financial and business matters that Holder is capable of
      evaluating the merits and risk of such
  investment.

                

        

         

        
          	
                   
      

                	
                  Ability to Bear Economic Risk;
      Unregistered Securities.  Holder acknowledges that an
      investment in the Securities involves a high degree of risk, and
      represents that Holder is able, without materially impairing Holder’s
      financial condition, to hold the Securities for an indefinite period of
      time and to suffer a complete loss of its investment.  Holder
      must bear the economic risk of investment for an indefinite period of time
      because the Securities have not been registered under the Act, constitute
      “restricted securities” and therefore cannot and will not be sold unless
      they are subsequently registered under the Act or an exemption from such
      registration is available.  The Company has made no
      representations, warranties or covenants whatsoever as to whether any such
      registration or exemption from the Act will be
  available.

                

        

         

        
          	
                   
      

                	
                  Further Limitations on
      Disposition.  Without in any way limiting the
      representations set forth above, Holder further agrees not to make any
      disposition of all or any portion of the Securities unless and
      until:

                

        

         

        
          There is
then in effect a registration statement under the Act covering such proposed
disposition and such disposition is made in accordance with such registration
statement; or

        

         

        
          The
Holder shall have notified the Company of the proposed disposition and shall
have furnished the Company with a detailed statement of the circumstances
surrounding the proposed disposition, and if reasonably requested by the
Company, the Holder shall have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company, that such disposition will not require
registration under the Act or any applicable state securities
laws.

        

         

        
          	
                   
      

                	
                  Experience.  Holder
      is an “accredited investor” as such term is defined in Rule 501 of
      Regulation D under the Act, and Holder agrees to provide such
      additional customary investor questionnaires or other information as the
      Company may reasonably request in order to establish applicable exemptions
      for the issuance of the Securities under applicable federal and state
      securities laws.  If Holder is a limited partnership, limited
      liability corporation or similar entity, then Holder represents and
      warrants that all equity owners of the Holder are accredited investors.
      “Accredited investor”
      means any person who comes within any of the following categories, or who
      the issuer reasonably believes comes within any of the following
      categories, at the time of the sale of the securities to that
      person.  Holder
      has checked the category boxes below that apply to
      Holder:

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        Instructions: Check þ all Accredited Holder category
boxes below that apply to you.

         

        
          
            
              
                	
                        o

                      	
                        Any
      natural person (individual) whose individual net worth, or joint net worth
      with that person's spouse, at the time of his purchase exceeds
      $1,000,000;

                      
	
                        o

                      	
                        Any
      natural person (individual) who had an individual income in excess of
      $200,000 in each of the two most recent years or joint income with that
      person's spouse in excess of $300,000 in each of those years and has a
      reasonable expectation of reaching the same income level in the current
      year;

                      
	
                        o

                      	
                        Any
      bank as defined in section 3(a)(2) of
      the Act, or any savings and loan association or other institution as
      defined in section 3(a)(5)(A) of the
      Act whether acting in its individual or fiduciary capacity; any broker or
      dealer registered pursuant to section
      15 of the Securities Exchange Act of 1934; any insurance company as
      defined in section 2(13) of the Act;
      any investment company registered under the Investment Company Act of 1940 or a
      business development company as defined in section 2(a)(48)
      of that Act; any Small Business Investment Company licensed by the U.S.
      Small Business Administration under section 301(c) or (d) of the Small
      Business Investment Act of 1958; any plan established and maintained by a
      state, its political subdivisions, or any agency or instrumentality of a
      state or its political subdivisions, for the benefit of its employees, if
      such plan has total assets in excess of $5,000,000; any employee benefit
      plan within the meaning of the Employee Retirement Income Security Act of
      1974 if the investment decision is made by a plan fiduciary, as defined in
      section 3(21) of such act, which is either a bank,
      savings and loan association, insurance company, or registered investment
      adviser, or if the employee benefit plan has total assets in excess of
      $5,000,000 or, if a self-directed plan, with investment decisions made
      solely by persons that are accredited investors;

                      
	
                        o

                      	
                        Any
      private business development company as defined in section 202(a)22 of
      the Investment Advisers Act of 1940;

                      
	
                        o

                      	
                        Any
      organization described in section 501(c)3 of
      the Internal Revenue Code, corporation, Massachusetts or
      similar business trust, or partnership, not formed for the specific
      purpose of acquiring the securities offered, with total assets in excess
      of $5,000,000;

                      
	
                        o

                      	
                        Any
      director, executive officer, or general partner of the issuer of the
      securities being offered or sold, or any director, executive officer, or
      general partner of a general partner of that issuer;

                      
	
                        o

                      	
                        Any
      trust, with total assets in excess of $5,000,000, not formed for the
      specific purpose of acquiring the securities offered, whose purchase is
      directed by a sophisticated person as described in Rule 506(b)(2)(ii) and

                      
	
                        o

                      	
                        Any
      entity in which all of the equity owners are accredited
      investors.

                      

              

            

          

        

        

        
          	
                   
      

                	
                  No
      Brokers.  No person has or will have, as a result of the
      transactions contemplated by this Note, any right, interest or valid claim
      against the Holder or the Company for any commission fee or other
      compensation as a finder or broker because of any act or omission of such
      Holder or any agent for the Holder.

                

        

         

        
          	
                   
      

                	
                  Power and
      Authority.  Holder has the full power and authority to
      enter into this Note and perform the transactions contemplated by this
      Note.  This Note, when executed and delivered by the Holder,
      shall constitute valid and binding obligations of the Holder enforceable
      in accordance with its terms, subject to the laws of general application
      relating to bankruptcy, insolvency, the relief of debtors and to rights to
      indemnity.

                

        

         

        
          	
                   
      

                	
                  No
      Conflicts.  The execution and delivery of and performance
      of the transactions contemplated by this Note is not in conflict with or
      will not result in any material breach of any terms, conditions or
      provisions of, or constitute a material default under its corporate
      charter or other organizational document, as applicable, or any indenture,
      lease, agreement, order, judgment or other instrument to which such Holder
      is a party.ex_10-4.htm

    
      

      

    

    Exhibit 10.4

     

     

    
      Exhibit
10.4 Common Stock Purchase Warrant dated June 22, 2009, between the Company
and Margaret Wong

       

      
        	Warrant No.
      0001	
                350,000
      Shares

              

      

       

       Issued
June 22, 2009

      OCTUS,
INC.

      

      WARRANT
TO PURCHASE

      SHARES
OF COMMON STOCK

      

      

      THE
SECURITIES REPRESENTED HEREBY, INCLUDING THE COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT").  NO TRANSFER OF SUCH SECURITIES WILL BE PERMITTED UNLESS
A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT AS TO SUCH TRANSFER,
SATISFACTORY EVIDENCE IS PROVIDED TO THE CORPORATION THAT THE TRANSFER IS MADE
IN ACCORDANCE WITH RULE 144 UNDER THE ACT OR, IN THE OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION, REGISTRATION UNDER THE ACT IS UNNECESSARY IN
ORDER FOR SUCH TRANSFER TO COMPLY WITH THE ACT.  SUCH TRANSFER MUST
ALSO COMPLY WITH APPLICABLE STATE SECURITIES LAWS.  THE CORPORATION
MAY REQUIRE THE HOLDER TO BEAR THE COSTS AND EXPENSES ASSOCIATED
WITH:  (1) THE LEGAL OPINION REFERRED TO ABOVE AND (2) ANY OTHER
ACTIONS REQUIRED TO COMPLY WITH THE ACT AND APPLICABLE STATE SECURITIES
LAWS.

      

      THESE
SECURITIES, INCLUDING THE COMMON STOCK ISSUABLE UPON EXERCISE HEREOF, ARE
SUBJECT TO, AND TRANSFERABLE ONLY UPON COMPLIANCE WITH, THE PROVISIONS OF A
SUBSCRIPTION AGREEMENT, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE
OFFICE OF THE CORPORATION.  SUCH SUBSCRIPTION AGREEMENT PROVIDES,
AMONG OTHER THINGS, FOR A MARKET STAND-OFF AGREEMENT AND CERTAIN OTHER
RESTRICTIONS ON THE SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THESE
SECURITIES.

      

      

      THIS CERTIFIES THAT, for value
received, ("Holder")
is entitled to purchase Three Hundred Fifty Thousand (350,000) fully paid and
non-assessable shares of the unregistered, restricted Common Stock ("Common
Stock") of OCTUS, INC., a Nevada corporation (the "Company").

      

      1.Exercise
of Warrant.  The terms and
conditions upon which this Warrant may be exercised and the Common Stock covered
hereby (the "Warrant
Stock") may be purchased are as follows:

       

      1.1 Term.  This Warrant may
be exercised in whole or in part at any time after the date set forth above but
in no case may this Warrant be exercised later than 5:00 p.m., Davis,
California, U.S.A. local time at anytime prior to One Hundred Eighty (180) days
from the issuance of this Warrant, after which time this Warrant shall terminate
and shall be void and of no further force or effect.

       

      1.2 Purchase
Price.  The per-share
purchase price for the shares of Stock to be issued upon exercise of this
Warrant shall be One Cent ($0.01), subject to adjustment as provided in Section
2.

      

      1.3 Method of
Exercise.

       

      1.3.1 Cash
Exercise.  The purchase rights represented by this Warrant may
be exercised by Holder, in whole or in part, by the surrender of this Warrant at
the principal office of the Company, located at the address set forth on the
signature page hereof, accompanied by the form of Notice of Cash Exercise
attached hereto as Exhibit "A", and
by the payment to the Company, by cash or by certified, cashier's or other check
acceptable to the Company, of an amount equal to the aggregate purchase price of
the shares of Warrant Stock purchased.

       

      1.3.2 Net Issue
Exercise.  In lieu of exercising this Warrant pursuant to
Section 1.3.1, Holder may elect to receive shares equal to the value of
this Warrant determined in the manner described below (or of any portion thereof
remaining unexercised) by surrender of this Warrant at the principal office of
the Company together with the form of Notice of Exercise of Common Stock Warrant
Pursuant to Net Issue ("Cashless") Exercise Provisions attached hereto as Exhibit "B", in
which event the Company shall issue to Holder a number of shares of the
Company's Common Stock computed using the following formula:

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      

      X = Y (A-B)

              A

      

      Where X =
the number of shares of Warrant Stock to be issued to Holder.

       

      Y = the
number of shares of Warrant Stock purchasable under this
Warrant (at the date of such calculation).

       

      A = the
fair market value of one share of the Company's Common
Stock (at the date of such calculation).

       

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

      

      1.3.3 Fair
Market Value.  For purposes of
this Section 1.2, fair market value of one share of the Company's Common Stock
shall be determined in good faith by the Company's Board of
Directors.

      

      1.4 Issuance
of Shares.  In the event of
any exercise of the rights represented by this Warrant, certificates for the
shares of Common Stock so purchased shall be delivered to Holder within a
reasonable time and, unless this Warrant has been fully exercised or has
expired, a new Warrant representing the remaining unexercised number of shares
shall also be issued to Holder at such time.

      

      2.
Certain
Adjustments.

      

      2.1 Merger;
Consolidation or Sale of Assets. If at any time there shall
be a capital reorganization (other than a combination or subdivision of Warrant
Stock otherwise provided for in this Warrant), or a merger or consolidation of
the Company with or into another corporation, or the sale of the Company's
properties and assets as, or substantially as, an entirety to any other person,
then, as a part of such reorganization, merger, consoli­dation or sale,
lawful provision shall be made so that the Holder shall thereafter be entitled
to receive upon exercise of this Warrant, during the period specified in this
Warrant and upon payment of the purchase price, the number of shares of stock or
other securities or property of the Company or the successor corporation
resulting from such reorganization, merger, consoli­dation or sale to which
a holder of the Common Stock deliverable upon exercise of this Warrant would
have been entitled under the provisions of the agreement in such
reorgani­zation, merger, consolidation or sale if this Warrant had been
exercised immediately before that reorganization, merger, con­solidation or
sale. In any such case, appropriate adjustment (as determined in good faith by
the Company's Board of Directors) shall be made in the application of the
provisions of this Warrant with respect to the rights and interests of the
Holder after the reorganization, merger, consolidation or sale to the end that
the provisions of this Warrant (including adjustment of the purchase price then
in effect and the number of shares of Warrant Stock) shall be applicable after
that event, as nearly as reasonably may be, in relation to any shares or other
property deliverable after that event upon exercise of this
Warrant.

      

      2.2 Splits
and Subdivisions.  In the event the
Company should at any time or from time to time fix a record date for the
effectuation of a split or subdivision of the outstanding shares of Common Stock
or the determination of the holders of Common Stock entitled to receive a
dividend or other distribution payable in additional shares of Common Stock or
other securities or rights convertible into, or entitling the holder thereof to
receive directly or indirectly, additional shares of Common Stock (hereinafter
referred to as the "Common
Stock Equivalents") without payment of any consideration by such holder
for the additional shares of Common Stock or Common Stock Equivalents (including
the additional shares of Common Stock issuable upon conversion or exercise
thereof), then, as of such record date (or the date of such distribution, split
or subdivision if no record date is fixed), the purchase price set forth in
Section 1.2 shall be appropriately decreased and the number of shares of
Warrant Stock shall be appropriately increased in proportion to such increase of
outstanding shares.

      

      2.3 Combination
of Shares.  If the number of
shares of Common Stock outstanding at any time after the date of this Warrant is
decreased by a combination of the outstanding shares of Common Stock, the
purchase price set forth in Section 1.2 shall be appropriately increased
and the number of shares of Warrant Stock shall be appropriately decreased in
proportion to such decrease in outstanding shares.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

      2.4 Certificate
as to Adjustments.  In the case of
each adjustment or readjustment of the purchase price and the number of shares
pursuant to this Section 2, the Company will promptly compute such adjustment or
readjustment in accordance with the terms hereof and cause a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based to be delivered to the Holder. The
Company will, upon the written request at any time of the Holder, furnish or
cause to be furnished to such Holder a certificate setting forth:

      

      2.4.1 Such adjustments and
readjustments;

      

      2.4.2 The purchase price at the
time in effect; and,

       

      2.4.3 The
number of shares of Warrant Stock and the amount, if any, of other property at
the time receivable upon the exercise of the Warrant.

      

      3. Fractional
Shares.  No fractional
shares shall be issued in connection with any exercise of this
Warrant.  In lieu of the issuance of fractional shares, the Company
shall round up or round down such fractional shares, as the Company deems
appropriate, to the nearest whole share of Common Stock or Holder may purchase a
whole share by delivering payment equal to the appropriate portion of the
purchase price.

      

      4. Reservation
of Stock.  The Company shall
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the exercise of this
Warrant, such number of its shares of Common Stock as shall from time to time be
sufficient to effect the exercise of this Warrant; and if at any time the number
of authorized but unissued shares of Common Stock shall not be sufficient to
effect the exercise of the entire Warrant, in addition to such other remedies as
shall be available to the Holder, the Company will use its reasonable best
efforts to take such corporate action as may, in the opinion of its counsel, be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes.

      

      5. No
Stockholders' Rights Until Exercise.  Prior to the
exercise of this Warrant, the Holder shall not be entitled, by virtue of holding
this Warrant, to any rights of a stockholder of the Company.

      

      6. Transfers
and Exchanges.

      

      6.1 Restrictions
on Transfer.  This Warrant and
the shares of Warrant Stock receivable upon exercise of this Warrant are subject
to certain restrictions and limitations on transfer, as set forth in the
Subscription Agreement executed by Holder, including, without limitation, a
market standoff agreement in connection with any registration of the Company's
securities under the Act.

      

      6.2 Transfer.  This Warrant is
transferable on the books of the Company at its principal office by the
registered Holder upon surrender of this Warrant properly endorsed, subject to
compliance with federal and state securities laws.  The Company shall
issue and deliver to the transferee a new Warrant or Warrants representing the
Warrants so transferred.  Upon any partial transfer, the Company will
issue and deliver to Holder a new Warrant or Warrants with respect to the
portion of the Warrant not so transferred.  Notwithstanding the
foregoing, Holder shall not be entitled to transfer a number of shares or an
interest in this Warrant representing less than five percent (5%) of the
aggregate shares initially covered by this Warrant (as presently constituted,
with appropriate adjustment being made in the event of stock splits,
combinations, reorganizations and the like occurring after the issue date
hereof).  Any transferee shall be subject to the same restrictions on
transfer with respect to this Warrant as Holder.

      

      6.3 Securities
Laws.  If required by
the Company, in connection with each issuance of shares of Warrant Stock upon
exercise of this Warrant, Holder will give: (a) assurances in writing,
satisfactory to the Company, that such shares are not being purchased with a
view to the distribution thereof in violation of applicable laws,
(b) sufficient information, in writing, to enable the Company to rely on
exemptions from the registration or qualification requirements of applicable
laws, if available, with respect to such exercise, and (c) its cooperation
to the Company in connection with such compliance.  Holder
acknowledges and agrees that any certificates representing shares of Warrant
Stock shall bear legends similar to those set forth on the first page of this
Warrant and any legends required by applicable state securities
laws.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

      7. Loss,
Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company
of evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and, in case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to the Company, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new warrant of like tenor and dated as of such cancellation,
in lieu of this Warrant.

      

      8.
Miscellaneous.

      

      8.1 GOVERNING
LAWS.  THE INTERNAL LAWS
OF THE STATE OF NEVADA, U.S.A. (IRRESPECTIVE OF ITS CHOICE OF LAW PRINCIPLES)
SHALL GOVERN THE VALIDITY OF THIS WARRANT, THE CONSTRUCTION OF ITS TERMS, AND
THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE COMPANY AND
HOLDER.

      

      8.2 Binding
Upon Successors and Assigns.  Subject to, and
unless otherwise provided in, this Warrant, each and all of the covenants,
terms, provisions, and agreements contained in this Warrant shall be binding
upon, and inure to the benefit of, the permitted successors, executors, heirs,
representatives, administrators and assigns of the Company and
Holder.

      

      8.3 Severability.  If any one or
more provisions of this Warrant, or the application thereof, shall for any
reason and to any extent be invalid or unenforceable, the remainder of this
Warrant and the application of such provisions to other persons or circumstances
shall be interpreted so as best to reasonably effect the intent of the Company
and Holder.  The Company and Holder further agree to replace any such
void or unenforceable provisions of this Warrant with valid and enforceable
provisions which will achieve, to the extent possible, the economic, business
and other purposes of the void or unenforceable provisions.

      

      8.4 Notices.  All notices,
consents, waivers or demands of any kind which the Company or Holder may be
required or may desire to serve on the other in connection with this Warrant
shall be in writing and shall be delivered by personal service or sent by
telecopy or registered or certified mail, return receipt requested, with postage
fully prepaid.  All such communications shall be addressed as
follows:

      

      If to the
Company:               At
the address set forth below.

       

      If to
Holder:                          
At the
address set forth in the Company's stock record books.

      

      Except as
may otherwise be provided in this Warrant, all such communications shall be
deemed to have been duly given when transmitted by facsimile with verified
receipt by the transmitting facsimile, when personally delivered, two (2) days
after being delivered to an air courier (e.g. Federal Express) upon
proof of delivery, or, in the case of a mailed notice, five (5) days after being
deposited certified or registered mail, postage prepaid.  The Company
or Holder may change its address for such communications by giving notice to the
other as provided in this Section.

      

      8.5 No
Endorsement.  Holder
understands that no federal or state securities administrator has made any
finding or determination relating to the fairness of investment in the Company
or the purchase of this Warrant or the Common Stock issuable upon the exercise
of this Warrant and that no federal or state securities administrator has
recommended or endorsed the offering of securities by the Company under this
Warrant.

      

      8.6 Amendments
and Waivers. Any
term of the Warrant may be amended and the observance of any term of the Warrant
may be waived (either generally or in a particular instance and either
retroactively or prospectively), with the written consent of the Company and the
Holder.

       

      
        
          
            
              	 	OCTUS, INC.	 
	 	 	 	 
	
                       

                    	
                      By:
      

                    	/s/ Christian
      Soderquist	 
	 	 	Christian
      Soderquist, Chief Executive Officer	 
	 	 	 	 
	 	 	      
                      Address:

                      OCTUS,
      INC.

                      719
      Second Street, Suite 9

                      Davis,
      CA  95616

                    	 

            

          

        

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
A

      

      NOTICE OF CASH
EXERCISE

      

      OCTUS,
INC.

      719
Second Street, Suite 9

      Davis,
CA  95616

      

      Ladies
and Gentlemen:

      

      The undersigned hereby
elects to purchase, pursuant to the provisions of the Warrant dated June 22,
2009 held by the undersigned, Three Hundred Fifty Thousand (350,000)
shares of the unregistered, restricted Common Stock of OCTUS, INC., a Nevada
corporation, at one cent ($0.01) per share.  The undersigned confirms
and acknowledges the investment representations and warranties made in the
Subscription Agreement executed by the undersigned, and accepts such shares
subject to the restrictions contained therein.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            	
                                                                                    For
      joint ownership BOTH parties should sign and date below.

                                                                                  	 
      	
                                                                                    For
      corporations, partnerships, trusts or other entities, one or more
      signatories, as appropriate, should sign and date below.                                  

                                                                                  
	 	 	 
	 	 	 
	Signature	 
      	Name of
  Entity
	 	 	 
	Name of
    Signatory	 	Signature
	 	 	 
	Date:	 	 
	 	 	Name and Title of
      Signatory
	 	 	 
	Second Signature (if
      required)	 	Date:   
	 	 	 
	Name of Second
      Signatory	 	 
	 	 	Second Signature (if
      required)
	 	 	 
	Date: 	 	 
	 	 	Name and Title of Second
      Signatory
	 	 	 
	 	 	Date:   

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      ACCEPTED
AND AGREED:

      OCTUS
, INC.

      

      
        
          
            
              
                	
                        By: 

                      	 	 	
                         

                      	 
	
                        
                          Christian
      Soderquist

                          Chief
      Executive Officer

                        

                      	 	 	
                         

                      	 

              

            

          

        

      

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
B

       

      NOTICE
OF EXERCISE OF COMMON STOCK WARRANT

      PURSUANT TO NET ISSUE
("CASHLESS") EXERCISE PROVISIONS

      

      

      

      OCTUS,
INC.

      719
Second Street, Suite 9

      Davis,
CA  95616

      

      

      

      Ladies
and Gentlemen:

      

      The
undersigned, registered Holder of the Common Stock Warrant delivered herewith
("Warrant"), hereby irrevocably
exercises such Warrant for, and purchases thereunder, shares of the
unregistered, restricted Common Stock of Octus, Inc., a Nevada corporation, as
provided below.  Capitalized terms used herein, unless otherwise
defined herein, shall have the meanings given in the Warrant.  The
number of shares of Common Stock being purchased pursuant to this Notice of
Exercise is  , thereby
leaving a remainder of   shares (if
any).  Such exercise shall be pursuant to the net issue exercise
provisions of Section 1.3.2 of the Warrant; therefore, Holder makes no
payment with this Notice of Exercise.  The number of shares to be
issued pursuant to this exercise shall be determined by reference to the formula
in Section 1.3.2 of the Warrant which, by reference to Section 1.3.3,
requires the use of the current per share fair market value of the Company's
Common Stock.  The current fair market value of one share of the
Company's Common Stock shall be determined in the manner provided in
Section 1.3.3, which amount has been determined by the Company to be $ , which figure
is acceptable to Holder for calculations of the number of shares of Common Stock
issuable pursuant to this Notice of Exercise.  Holder requests that
the certificates for the purchased shares of Common Stock be issued in the name
of and delivered to  .  To
the extent the foregoing exercise is for less than the full number of shares
purchasable under the Warrant, a replacement Warrant representing the remainder
of the shares (and otherwise of like form, tenor and effect) shall be delivered
to Holder along with the share certificate evidencing the Common Stock issued in
response to this Notice of Exercise.

      
 

      [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      

      Octus,
Inc.

      Notice of
Exercise of Common Stock Warrant

      Page
2

       

      
        

        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              	
                                                                                      For
      joint ownership BOTH parties should sign and date below.

                                                                                    	 
      	
                                                                                      For
      corporations, partnerships, trusts or other entities, one or more
      signatories, as appropriate, should sign and date below.                                  

                                                                                    
	 	 	 
	 	 	 
	Signature	 
      	Name of
  Entity
	 	 	 
	Name of
    Signatory	 	Signature
	 	 	 
	Date:	 	 
	 	 	Name and Title of
      Signatory
	 	 	 
	Second Signature (if
      required)	 	Date:   
	 	 	 
	Name of Second
      Signatory	 	 
	 	 	Second Signature (if
      required)
	 	 	 
	Date: 	 	 
	 	 	Name and Title of Second
      Signatory
	 	 	 
	 	 	Date:   

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
           

          ACCEPTED
AND AGREED:

          OCTUS,
INC.

        

        
          
            
              
                	 	 	 	 	 
	
                        By: 

                      	 	 	
                         

                      	 
	
                        
                          Christian
      Soderquist

                          Chief
      Executive Officer

                        

                      	 	 	
                         

                      	 

              

            

          

        

      

       

       

      7

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