Document:

First Amendment to Excercise Agreement

 Exhibit 10.46 
 FIRST AMENDMENT TO 
 EXERCISE AGREEMENT 
 THIS FIRST AMENDMENT TO EXERCISE AGREEMENT (this “Amendment”), is made as of September 20, 2007 (the “Effective Date”,
by and among M-Wave, Inc., a Delaware corporation (the “Company”) and MAG Capital, LLC, a California limited liability company, Mercator Momentum Fund, LP, a California limited partnership, Mercator Momentum Fund III, LP, a
California limited partnership, and Monarch Pointe Fund, Ltd., an international business company organized under the laws of the British Virgin Islands (collectively, the “Stockholders”). 
 RECITALS 
 WHEREAS, the Company and
the Stockholders entered into that certain Exercise Agreement dated as of January 26, 2007 (the “Agreement”). Capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement;

 WHEREAS, the Company and the Stockholders desire to amend the Agreement in order to eliminate the Stockholder put rights contained in
Article IV thereof; and 
 WHEREAS, in exchange for the elimination of the put rights, the Company agrees that, on the closing date of the
mergers of SunFuels, Inc. and Blue Sun Biodiesel LLC into Ocean Merger Sub, Inc., (the “Closing Date”), the Company will use all of its remaining cash after paying all accrued liabilities of the Company as of the Closing Date to pay
to the Stockholders all accrued but unpaid dividends on their shares of Series A Convertible Preferred Stock and Series B Convertible Preferred Stock, including any such dividends that have been waived. 
 NOW, THEREFORE, in consideration of the mutual agreements and covenants contained herein and other good and valuable consideration, the
parties hereto agree as follows: 
 1. Amendment to Article IV. Article IV of the Agreement is hereby deleted in its entirety and
replaced with the following. 
 “ARTICLE IV 
 PAYMENT OF ACCRUED DIVIDENDS ON SERIES B SHARES; MANDATORY REDEMPTION OF SERIES A SHARES 
 Section 4.1 Payment of Dividends on Series B Shares. On the closing date under the Merger Agreement, (the “Closing Date”) the Company will use its remaining cash and cash equivalents after paying all accrued
liabilities of the Company as of the Closing Date (the “Remaining Cash”) to pay to the Stockholders the accrued but unpaid dividends on their shares of Series B Convertible Preferred Stock as of the Closing Date (“Accrued
Dividends”). Dividends shall be paid to the Stockholders pro rata based on the number of shares of Series B Convertible Preferred Stock owned by each of them. For purposes of this Agreement, the Remaining Cash does not include any
cash that is paid to the Company by SunFuels, Inc. pursuant to Section 13.1 of the Merger Agreement, as amended by the Second Amendment thereto (the “Reimbursed Cash”). For the avoidance of doubt, the Reimbursed Cash shall be retained by
the Company and not paid to the Stockholders. 
  

 Section 4.2 Mandatory Redemption of Series A Shares. If the Company has any Remaining Cash
after making the dividend payment required by Section 4.1 (such additional cash, “Excess Cash”), then the Company shall use such Excess Cash to redeem shares of Series A Convertible Preferred Stock of the Company from
the Stockholders. The redemption price per share of Series A Convertible Preferred Stock shall be $3.92 per share (the “Redemption Price”). Shares of Series A Convertible Preferred Stock shall be redeemed from the Stockholders pro
rata based on the number of shares of Series A Convertible Preferred Stock owned by each of them. 
 Section 4.3 Adjustment Upon
Changes in Capitalization. In the event of any change in the Common Stock, by reason of any stock dividends, splits, mergers, recapitalizations or other changes in the corporate or capital structure of the Company, the number and kind of Shares
subject to this Article IV and the Redemption Price shall be appropriately adjusted. 
 Section 4.4 Waiver of Accrued Dividends.
If the Accrued Dividends exceed the Remaining Cash on the Closing Date (such excess, “Excess Dividends”), then the Stockholders hereby permanently waive and release the Company from any liability for such Excess Dividends, effective
as of the closing of the mergers under the Merger Agreement.” 
 2. Representations and Warranties. Each of the parties hereto
represents and warrants as follows: 
 (a) The execution, delivery and performance by such party of this Amendment and the performance by
such party of the Agreement, as amended hereby, have been duly authorized by all necessary action, and such party has all requisite power, authority and legal right to execute, deliver and perform this Amendment and to perform the Agreement, as
amended hereby. 
 (b) Each of this Amendment and the Agreement, as amended hereby, is a legal, valid and binding obligation of such party,
enforceable against such party in accordance with the terms thereof, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’
rights generally. 
 3. Reference to and Effect on the Agreement. 
 (a) On and after the Effective Date, each reference in the Agreement to “this Agreement”, “hereunder”, “hereof” or words of
like import referring to the Agreement shall mean and be a reference to the Agreement as amended by this Amendment. 
 (b) Except to the
extent specifically amended hereby, all of the terms of the Agreement shall remain unchanged and in full force and effect. 
 (c) The
execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any party under the Agreement or constitute a waiver of, or a consent to departure from, any
of the terms and conditions of the Agreement, nor obligate any party to similar amendments in the future. 
  

 2 

 4. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature
page to this Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Amendment. 
 [Signature Pages
Follows] 
  

 3 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date
first written above. 
  

			
	M-Wave, Inc.
		
	By:	  	/s/ Jim Mayer
	Name: Jim Mayer
	Title: Interim CEO

  

									
	Monarch Pointe Fund Ltd.	 		 	Mercator Momentum Fund, L.P.
					
	By:	 	M.A.G. CAPITAL, LLC	 		 	By:	 	M.A.G. CAPITAL, LLC
	Its:	 	General Partner	 		 	Its:	 	General Partner

  

									
					
	By:	 	/s/ Harry Aharonian	 		 	By:	 	/s/ Harry Aharonian
		 	Harry Aharonian	 		 		 	Harry Aharonian
		 	Portfolio Administrator	 		 		 	Portfolio Administrator

  

									
					
	By:	 	/s/ Todd Bomberg	 		 	By:	 	/s/ Todd Bomberg
		 	Todd Bomberg	 		 		 	Todd Bomberg
		 	Chief Investment Officer	 		 		 	Chief Investment Officer

  

									
		 		 	Mercator Momentum Fund III, L.P.
					
		 		 		 	By:	 	M.A.G. CAPITAL, LLC
		 		 		 	Its:	 	General Partner

  

									
					
		 		 		 	By:	 	/s/ Harry Aharonian
		 		 		 		 	Harry Aharonian
		 		 		 		 	Portfolio Administrator

  

									
					
		 		 		 	By:	 	/s/ Todd Bomberg
		 		 		 		 	Todd Bomberg
		 		 		 		 	Chief Investment Officer

  

 SIGNATURE PAGEdbog_ex1003-70228.htm

    Exhibit
      10.03

    
       

      CONSULTING  AGREEMENT

    

    
      

       

      THIS
        AGREEMENT made effective March 1, 2005 (the "Effective Date"). 

       

      BETWEEN:

    

    
      

      Daybreak
        Mines, Inc., a body corporate, incorporated pursuant to the laws of the State
        of
        Washington

    

    
      

      (hereinafter
        referred to as the "Corporation")

    

    
       

      OF
        THE
        FIRST PART - 

      and
        -

    

    
      

       

      413294
        Alberta Ltd., a body corporate, incorporated pursuant to the laws of the
        Province
        of Alberta

    

    
      

      (hereinafter
        referred to as the "Consultant")

    

    
       

      OF
        THE
        SECOND PART

    

    
      

       

      WHEREAS
        the Corporation wishes to engage the services and expertise of the Consultant
        on
        the terms and conditions hereinafter set forth, and the Consultant wishes
        to
        accept such an engagement;

    

    
       

      NOW
        THEREFORE in consideration of the covenants of each of the parties given
        to the
        other and for other good and valuable consideration, the receipt and sufficiency
        of which is hereby acknowledged, the parties hereto agree as
        follows:

    

    
      

      
        	
                1.

              	
                SERVICES

              

      

    

    
       

      
        	
                1.1

              	
                Effective
                  as of the Effective Date, the Corporation engages the Consultant,
                  and the
                  Consultant accepts an engagement with the Corporation to render
                  the
                  consulting services for the Corporation as set out in Schedule
                  A. During
                  the term of this Agreement, the Consultant shall provide the services
                  of
                  Robert Martin who shall devote such of his time, attention and
                  abilities
                  to the business of the Corporation as may be necessary for the
                  proper
                  exercise of the Consultant's duties hereunder. Nothing in this
                  Agreement
                  shall be interpreted or construed as creating or establishing a
                  relationship of employer and/or employee between the Corporation
                  and
                  Robert Martin.

              

      

    

    
      

      
        	
                2.

              	
                DUTIES

              

      

    

    
       

      
        	
                2.1

              	
                The
                  Consultant shall make the services of Mr. Robert Martin available,
                  as
                  requested, to perform
                  this Agreement.   The Consultant agrees that Robert Martin
                  shall be entitled to render
                  services to others in the oil and gas industry during the term
                  of this
                  consulting agreement.

              

      

    

    
       

      
        	
                2.2

              	
                The
                  Consultant's duties shall be to provide the services more particularly
                  set
                  forth on Schedule
                  "A" hereto.

              

      

    

    
       

      
        	
                2.3

              	
                The
                  Consultant warrants and represents that it is duly qualified to
                  perform
                  its duties hereunder,
                  and further covenants that in performing its duties hereunder,
                  it will not
                  engage
                  in activity that is in violation of applicable securities laws
                  or subject
                  the Corporation
                  to liability thereunder.

              

      

    

    
       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        	
                3.

              	
                COMPENSATION

              

      

    

    
      

      The
        Corporation agrees to compensate the Consultant as set out in Schedule "B"
        attached hereto.

    

    
      

      
        	
                4.

              	
                CONFIDENTIALITY

              

      

    

    
       

      
        	
                4.1

              	
                The
                  Consultant acknowledges the Corporation will have reporting and
                  disclosure
                  obligations
                  under all applicable securities legislation. The Consultant covenants
                  and
                  agrees
                  that it shall not any time, during or after the termination of
                  the
                  Consultant's engagement
                  by the Corporation, reveal, divulge, or make known to any person
                  (other
                  than
                  the Corporation or its affiliates) or use for its own account any
                  customer's lists, trade
                  secrets, or secret or confidential information used by the Corporation
                  or
                  its Affiliates
                  during the Consultant's engagement by any of them and made known
                  (whether
                  or not with the knowledge and permission of the Corporation, whether
                  or
                  not developed,
                  devised or otherwise created in whole or in part by the efforts
                  of the
                  Consultant,
                  and whether or not a matter of public knowledge unless as a result
                  of
                  authorized disclosure)
                  to the Consultant by reason of its engagement by the Corporation
                  of any of
                  its Affiliates. The Consultant further covenants and agrees that
                  all
                  knowledge and information, which is acquired or developed for the
                  Corporation or any of its Affiliates by the Consultant, is the
                  property of
                  the Corporation. The Consultant further covenants and agrees that
                  it shall
                  retain all such knowledge and information which it shall acquire
                  and
                  develop during such engagement respecting such customer lists,
                  trade
                  secrets and secret or confidential information in trust for the
                  sole
                  benefit of the Corporation, its affiliates, and their successors
                  and
                  assigns.

              

      

    

    
       

      
        	
                4.2

              	
                The
                  Consultant shall promptly communicate and disclose to the Corporation
                  all observations made and data obtained by it in the course of its
                  engagement by the Corporation.  All
                  written materials, records and documents created by the Consultant
                  or
                  coming
                  into its possession concerning the business or affairs of the Corporation
                  or any of
                  its Affiliates shall, upon the termination of this Agreement, promptly
                  be
                  returned to the Corporation.
                  Upon the request of the Corporation until termination of
                  its engagement by the Corporation, the Consultant shall render to the
                  Corporation or to any Affiliate  designated by it such
                  reports of the activities undertaken by the Consultant or conducted
                  under the Consultant's direction for the Corporation and
                  its Affiliates as the Corporation may
                  request.

              

      

    

    
       

      
        	
                4.3

              	
                Any
                  breach of Confidentiality as outlined above will be prosecuted
                  to the full
                  extent of the
                  law, and reported to the Consultant's applicable regulatory
                  Board.

              

      

    

    
      

      
        	
                5.

              	
                TERM

              

      

    

    
       

      
        	
                5.1

              	
                This
                  Agreement shall be for a term commencing March
                  1, 2005 and terminating February
                  28, 2006. Either party may terminate this Agreement at any
                  time without notice in the event of a fundamental breach of the terms
                  of this Agreement by the other
                  party.

              

      

    

    
       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        	
                6.

              	
                CHANGE
                  OF CONTROL, SALE OF CORPORATION, SALE OF ASSETS OF THE
                  CORPORATION

              

      

    

    
       

    

    
      
        	
                6.1

              	
                The
                  Corporation acknowledges the valuable services that the Consultant
                  has
                  provided and
                  will continue to provide to the Corporation in providing the services
                  of
                  Robert Martin
                  in his capacity as an officer thereof and an authorized representative
                  thereof.

              

      

    

    
       

      
        	
                6.2

              	
                The  Corporation  acknowledges  that  in  the   event  of   a  change  of  control  of  the
                  Corporation
                  or a sale of any of the assets of the Corporation, there is a possibility
                  that the
                  service of the Consultant would no longer be required and that
                  this
                  contract might be
                  determined.

              

      

    

    
       

      
        	
                6.3

              	
                The
                  directors of the Corporation have determined that it would be in
                  the best
                  interests of
                  the Corporation to induce the Consultant to provide the services
                  of Robert
                  Martin to the Corporation by indicating that, in the
                  event of a change of control of the
                  Corporation
                  or the sale of assets, the Consultant would have certain automatic
                  and
                  guaranteed
                  rights.

              

      

    

    
      

       

      
        	
                6.4

              	
                "Takeover
                  of the control of the Corporation"
                  means:

              

      

    

     

    
      
        	
              	
                (a)

              	
                any
                  change in the holding, either direct or indirect, of shares of
                  the
                  Corporation, or     any      reconstruction,      reorganization,      recapitalization,      consolidation,
                  amalgamation,
                  merger, arrangement or other transaction, that results in a person
                  who
                  was, or a group of persons acting in concert who were, not previously
                  in a
                  position
                  to exercise effective control ot the Corporation (or any Associate
                  or
                  Affiliate
                  of any such person or group of persons), being in a position to
                  exercise
                  such
                  effective control either in respect of the Corporation or the successor
                  to
                  the
                  Corporation (and for the purposes of this Agreement, a person or
                  group of
                  persons
                  acting in concert, or any Associate or Affiliate of any such person
                  or
                  group
                  of persons, holding shares of the Corporation, or snares of the
                  successor
                  to
                  the Corporation, in excess of the number that would entitle the
                  holders
                  thereof
                  to cast twenty (25%)  percent or more of the votes attaching to
                  all shares
                  of the Corporation, or to shares of the successor to the Corporation,
                  shall be
                  deemed to be in a position to exercise elective control of the
                  Corporation, or the
                  successor to the Corporation, as the case may be);
                  and

              

      

    

    
       

      
        	
              	
                (b)

              	
                the exercise
                  of such effective control to cause or result in the election or
                  appointment
                  of two or more directors of the Corporation, or of the successor
                  to
                  the
                  Corporation, who were not previously directors of the
                  Corporation.

              

      

    

    
       

      
        	
                7.

              	
                NOTICES

              

      

    

    
      

      Any
        notices delivered or received between either party shall be deemed to have
        been
        received:

    

    
       

      
        	
              	
                (a)

              	
                if
                  it was delivered in person, on the date it was
                  delivered;

              

      

    

    
      
        	
              	
                
                  (b)

                

              	
                if
                  it was sent by electronic facsimile transmission, on the date it
                  was
                  delivered;

              

    

    
      
        	
              	
                (c)

              	
                it
                  was sent by mail, on the day it was received to the following
                  address:

              

      

    

    
       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Daybreak
        Mines, Inc.

      Spokane,
        Washington

      Attention:  Treasurer

       

      413294
        Alberta Ltd.

      621
        B  37th Street
        SW

      Calgary
        AB T3C 1R8 

      Attention;   Robert
        Martin 

      Cell
        Phone 403 660-9639

    

    
      

       

      
        	
                8.

              	
                MODIFICATION
                  OF
                  AGREEMENT

              

      

    

    
       

      
        	
                8.1

              	
                Any
                  modification of this Agreement must be made in writing signed by
                  the
                  Consultant and an officer of the Corporation or it shall have no
                  effect
                  and shall be void,

              

      

    

    
       

      
        	
                9.

              	
                GOVERNING
                  LAW

              

      

    

    
      

      This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of Washington and the parties agree to attorn to the jurisdiction of
        the
        courts of the State of Washington.

    

    
       

      
        	
                10.

              	
                HEADINGS

              

      

    

    
      

      The
        headings utilized in this Agreement are for convenience only and are not
        to be
        construed in any way as additions or limitations of the covenants and agreements
        contained in this Agreement.

    

    
       

      
        	
                11.

              	
                ENTIRE
                  AGREEMENT

              

      

    

    
      

      The
        covenants in this Agreement shall be construed as an agreement independent
        of
        any other provision in this Agreement. The parties acknowledge that it is
        their
        intention that the provisions of this Agreement be binding only to the extent
        that they may be lawful under the existing applicable laws and in the event
        that
        any provision of this Agreement is determined by a court of law to be
        overly broad or unenforceable, the remaining valid provisions shall remain
        in
        full force and effect. This Agreement constitutes the sole agreement between
        the
        parties hereto for services to be performed as herein described and the mutual
        covenants contained herein constitute due and adequate consideration for
        the
        full performance by each party of its obligations under this Agreement and
        any
        and all previous agreements, written or oral, expressed or implied, between
        the
        parties or on their releases and forever discharges the other of and from
        all
        manner of action, causes of action, claims or demands whatsoever under or
        in
        respect of any agreement.

    

    
      

      
        	
                12.

              	
                GENERAL
                  MATTERS

              

      

    

    
       

      
        	
                12.1

              	
                The
                  waiver by any party hereto of a breach of any provision of this
                  Agreement
                  shall not operate
                  or be construed as a waiver of any subsequent breach of the same
                  or of any
                  other
                  provisions of this Agreement.

              

      

    

    
       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        	
                12.2

              	
                This
                  Agreement shall be binding upon the parties hereto and shall enure
                  to the
                  benefit of
                  and be enforceable by each of the parties hereto and their respective
                  successors and assigns.

              

      

    

    
       

      IN
        WITNESS WHEREOF the parties hereto have executed this Agreement as of the
        1st
        day of March , 2005.

    

    
      

      
        	 	Daybreak
                Mines,
                Inc.	 	 	413294
                Alberta
                Ltd.	 
	 	 	 	 	 	 
	per:	
                /s/
                  Dale B.
                  Lavigne, President

              	 	per:	
                /s/
                  Robert N.
                  Martin, President

              	 

      

      

    

    
       

    

     

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      SCHEDULE
        "A"

    

    
      

       

      Services:

    

    
      

      Provide
        the services of President, of the Corporation and, in this regard, to have
        responsibility for the, direction, control and operation of the Corporation
        with
        the obligation, duty, authority and power to do all acts and things as are
        customarily done by persons holding the position of President, fn corporations
        of similar size to the Corporation and to do all acts and things as are
        reasonably necessary for the efficient and proper operation and development
        of
        the Corporation, reporting to the Board of Directors of the
        Company.

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
      

       

      

    

    
       

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      SCHEDULE
        “B”

    

    
      

      Remuneration

    

    
      	
          Remuneration
            shall be payable to the Consultant at the sole discretion of the board
            of
            directors, As consideration for performance of the services by the Consultant,
            the
            Corporation shall pay the Consultant 1,100,000 common voting {restricted}
            shares.

        

    

    	
        The
          consultant will also be paid $1,000 (USD) per month for incidental expenses
          for each
          month for which services are provided. The said rates shall be exclusive
          of
          travel
          expenses and related business expenses incurred by the Consultant and
          properly
          claimable in accordance with the provisions hereof.

      

    	
        The
          Corporation shall not be required to provide any benefits to the Consultant
          including,
          without limitation, dental, medical, disability or life
          insurance.

      

    	
        The
          Consultant shall submit invoices to the Corporation for each month or portion
          thereof
          for which services are provided during the period covered by the invoice
          and
          also
          including any proper claim for travel expenses.   Each invoice
          shall indicate the period
          covered, the month or portion of a month worked, the rate and the total
          charge
          for consultancy services.

      

    	
        The
          Corporation will reimburse the Consultant, at actual cost, for out-of-pocket
          expenses
          incurred in accordance with the Corporation's standard practice for the
          reimbursement
          of reasonable travel expenses incurred by its contractors or its own
          personnel.   The
          Corporation will also reimburse the Consultant for any reasonable long
          distance telephone, fax or photocopying charges incurred by the Consultant.
          Expenses
          claimed must be supported by the applicable receipts.

      

    	
        The
          Consultant will be responsible for the payment of the income taxes of all
          of
          its employees
          including, without limitation, Robert Martin, as well as Canada
          Pension Plan
          premiums and any and all other taxes and contributions imposed by (aw with
          respect
          to such employees. In the event the Consultant should fail to make any
          such
          payments, the Consultant indemnifies the Corporation for any claims, causes
          or  action,   or
          liabilities  which  may
          be  made,  advanced  or
          incurred  against the Corporation
          as a result of such non-payment, and agrees to be responsible for the
          Corporation's
          solicitor-client costs in defending or protecting itself.

      

    	
        The
          Corporation will pay all proper invoices received from the Consultant promptly
          following
          receipt of the applicable invoice and any necessary
          supported documentation.

      

    	
        The
          Corporation will, if it determines it to be necessary in its total discretion,
          ensure that
          appropriate liability insurance coverage is provided to Robert Martin at
          no
          cost to
          the
          Consultant or to Robert Martin, which coverage should be the same in all
          material
          respects as insurance coverage provided to Directors and Officers of the
          Corporation.

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