Document:

INCENTIVE STOCK OPTION AGREEMENT

 Exhibit 10.16 
 INCENTIVE STOCK OPTION AGREEMENT 
 API NANOTRONICS CORP. 
 2006 EQUITY INCENTIVE PLAN 
 THIS
AGREEMENT is dated and made effective as of May 30, 2008 by and between API NANOTRONICS CORP., a Delaware corporation (the “Company”), and Claudio Mannarino (“Optionee”). 
 WITNESSETH: 
 WHEREAS, Optionee on the date
hereof is an employee of the Company or one of its Subsidiaries; and 
 WHEREAS, the Company desires to grant an incentive stock option to
Optionee to purchase shares of the Company’s Common Stock pursuant to the Company’s 2006 Equity Incentive Plan, as amended (the “Plan”); and 
 WHEREAS, the Board of Directors of the Company originally authorized the grant of an incentive stock option to Optionee on December 26, 2006 (the “Effective Date”); and 
 WHEREAS, the Company and the Optionee previously agreed as of July 2, 2007 to reprice that certain Incentive Stock Option Agreement, dated as of the
Effective Date, between the Company and the Optionee; and 
 WHEREAS, the Company and the Optionee have agreed to reprice the Incentive Stock
Option Agreement dated July 2, 2007; and 
 WHEREAS, the Board of Directors of the Company has determined that, on the date hereof, the
Fair Market Value of Option Stock of the Company is not less than the exercise price per share provided below. 
 NOW, THEREFORE, in
consideration of the premises and of the mutual covenants herein contained, the parties hereto agree as follows: 
 1. Grant of
Option. The Company hereby grants to Optionee as of the date hereof the right and option (the “Option”) to purchase up to Three Hundred Seventy-Five Thousand (375,000) shares of Option Stock (“Shares”)
at an exercise price of $0.1005 per share on the terms and conditions set forth herein and subject to the terms and conditions of the Plan. This Option is intended to qualify as an “incentive stock option” within the meaning of
Section 422, or any successor provision, of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder. 
 All capitalized terms not defined in this Agreement shall have the meaning set forth in the Plan. 

 2. Duration and Exercisability. 
 a. Vesting/Exercise Period. The Option shall become exercisable as to portions of the Shares as follows: (i) the Option shall not be
exercisable with respect to any of the Shares until the first anniversary of the Effective Date (the “First Vesting Date”); (ii) if Optionee has continuously provided services to the Company or any Subsidiary from the Effective
Date through the First Vesting Date and has not been Terminated (as hereafter defined) on or before the First Vesting Date, then on the First Vesting Date the Option shall become exercisable as to twenty percent (20%) of the Shares; and
(iii) thereafter, provided that Optionee continuously provides services to the Company or any Subsidiary of the Company and is not Terminated, upon each of the four successive anniversaries of the First Vesting Date, the Option shall become
exercisable as to an additional twenty percent (20%) of the Shares; provided, that the Option shall in no event ever become exercisable with respect to more than 100% of the Shares. The Shares vesting under the Option have been limited to the
number of Shares allowed to conform to the $100,000 limit set forth at Section 9.1(b) of the Plan. 
 b. Expiration. The Option
shall expire on the tenth anniversary of the Effective Date (“Expiration Date”) and must be exercised, if at all, on or before the earlier of the Expiration Date and any date on which the Option terminated in accordance with the
provisions of Section 3. 
 c. Lapse Upon Expiration. To the extent that this Option is not exercised prior to the applicable
expiration date set forth in Section 2(b) or Section 3 of this Agreement, all rights of Optionee under this Option shall thereupon be forfeited. 
 3. Termination. 
 a. Termination for Any Reason Other than Death, Disability or a Change of
Control. If Optionee is Terminated for any reason other than his death, Disability or a Change of Control (both terms as hereafter defined), this Option shall be exercisable only to the extent the Option was exercisable on the date of
Termination, but had not previously been exercised, and shall expire on the earlier of (i) the close of business three months after the Termination Date (as hereafter defined) and (ii) the Expiration Date. Notwithstanding the foregoing, if
the Optionee is terminated for Cause, then the Option shall terminate immediately on the Optionee’s Termination Date. 
 b.
Termination Because of Death or Disability. If Optionee is Terminated because of his death or his Disability (or Optionee dies within three (3) months after a Termination other than because of his Disability or because of the existence
of Cause), then this Option shall be exercisable by Optionee, or the person or persons to whom Optionee’s rights under this Option shall have passed by Optionee’s will or by the laws of descent and distribution, only to the extent the
Option was exercisable on the date of Optionee’s Termination, but had not previously been exercised, and shall expire on the earlier of: (i) the close of business six months after Optionee’s Termination Date and (ii) the
Expiration Date. 
  

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 c. Definitions. 
 “Termination” or “Terminated” means that Optionee has for any reason ceased to provide services as an employee of the Company or Subsidiary of the Company, except in the case of sick
leave, military leave, or any other leave of absence approved by the Committee, provided that such leave is for a period of not more than ninety (90) days, or reinstatement upon the expiration of such leave is guaranteed by contract or statute.
The Committee shall have sole discretion to determine whether Optionee has ceased to provide services and the effective date on which Optionee ceased to provide services (the “Termination Date”). 
 “Disability” means a permanent and total disability within the meaning of Section 22(e)(3) of the Code (as provided under
Section 422(c)(6), or such applicable successor provision, of the Code), as determined by the Committee. 
 “Cause”
means that Optionee: 
 (a) shall have been convicted of any felony or a crime involving fraud, theft, misappropriation,
dishonesty or embezzlement; 
 (b) shall have committed intentional acts that materially impair the goodwill or business of
the Company or any Subsidiary or cause material damage to its property, goodwill or business; or 
 (c) shall have failed to
perform his material duties to the Company or any Subsidiary (other than as a result of a short-term disability (i.e., a disability that does not fall within the previously defined parameters of a Disability)), or a short term disability or medical
emergency involving a member of the Optionee’s immediate family, or as a result of any Company approved leave). 
 4. Manner of
Exercise. 
 a. General. The Option may be exercised only by Optionee (or other proper party in the event of death or
Disability), subject to the conditions of the Plan and this Agreement, and subject to such other administrative rules as the Committee deems advisable, by delivering written notice of exercise to the Company at its principal office. The notice shall
state the number of Shares exercised and shall be accompanied by payment in full of the Option price for all Shares exercised pursuant to the notice. Any exercise of the Option shall be effective upon receipt of such notice by the Company together
with payment that complies with the terms of the Plan and this Agreement. The Option may be exercised with respect to any number or all of the shares as to which it can then be exercised and, if partially exercised, may be so exercised as to the
unexercised shares at any time and from time to time prior to expiration of the Option as provided in this Agreement. 
 b. Form of
Payment. Subject to approval by the Committee, payment of the Option price by Optionee shall be in the form of cash, personal check, certified check, or where permitted by law and provided that a public market for the Company’s stock
exists: (i) through a 

  

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“same day sale” commitment from Optionee and a broker-dealer that is a member of the Financial Industry Regulatory Authority, Inc. (a
“FINRA Dealer”) whereby Optionee irrevocably elects to exercise the Option and to sell a portion of the Shares so purchased to pay for the exercise price and whereby the FINRA Dealer irrevocably commits upon receipt of such Shares
to forward the exercise price directly to the Company; or (ii) through a “margin” commitment from Optionee and a FINRA Dealer whereby Optionee irrevocably elects to exercise the Option and to pledge the Shares so purchased to the
FINRA Dealer in a margin account as security for a loan from the FINRA Dealer in the amount of the exercise price, and whereby the FINRA Dealer irrevocably commits upon receipt of such Shares to forward the exercise price directly to the Company.
Optionee shall be solely responsible for any income or other tax consequences from any payment for Shares with Optionee’s Common Stock of the Company. 
 c. Stock Transfer Records. Provided that the notice of exercise and payment are in form and substance satisfactory to counsel for the Company, as soon as practicable after the effective exercise of all or any
part of the Option, Optionee shall be recorded on the stock transfer books of the Company as the owner of the Shares purchased, and the Company shall deliver to Optionee, or to the FINRA Dealer, as the case may be, one or more duly issued stock
certificates evidencing such ownership. All requisite original issue or transfer documentary stamp taxes shall be paid by the Company. Optionee shall pay all other costs of the Company incurred to issue such Shares to such FINRA Dealer. 

Shares purchased pursuant to exercise hereunder: (i) may be deposited with a FINRA Dealer designated by Optionee, in street name, if so provided
in such exercise notice accompanied by all applications and forms reasonably required by the Committee to effect such deposit, or (ii) may be issued to Optionee and such other person, as joint owners with the right of survivorship, as is
specifically described in such exercise notice. Optionee shall be solely responsible for any income or other tax consequences of such a designation of ownership hereunder (or the severance thereof). 
 5. Miscellaneous. 
 a.
Employment Rights as Shareholder. This Agreement shall not confer on Optionee any right with respect to continuance of employment by the Company or any Subsidiary, nor shall it affect the right of the Company to Terminate such employment.
Optionee shall have no rights as a shareholder with respect to Shares subject to this Option until such Shares are issued to Optionee upon the exercise of this Option. No adjustment shall be made for dividends (ordinary or extra-ordinary, whether in
cash, securities or other property), distributions or other rights for which the record date is prior to the date such shares are issued, except as provided in Section 12 of the Plan. 
 b. Securities Law Compliance. The exercise of the Option and the issuance and transfer of Shares shall be subject to compliance by the Company and
Optionee with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s Common Stock may be listed at the time of such issuance or transfer. The Company
shall not be required to sell or issue any Shares if such issuance would constitute a violation of any provision of any law or regulation of any governmental authority. 
  

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 c. Mergers, Recapitalization, Stock Splits, Etc. The provisions of Sections 14 and 17 of the Plan,
as amended effective as of the date hereof, shall govern all Options in the event of any reorganization, merger, consolidation, recapitalization, reclassification, change in par value, stock split-up, combination of shares or dividend payable in
capital stock, or other such transaction described under Sections 14 and 17 of the Plan, and the Company reserves all discretion provided therein. 
 d. Withholding Taxes on Disqualifying Disposition. In the event of a disqualifying disposition of the Shares acquired through the exercise of this Option, Optionee hereby agrees to promptly provide the Company written notice of such
disposition, which notice shall be deemed delivered when received by the Company. Upon notice of a disqualifying disposition, the Company may take such action as it deems appropriate to insure that, if necessary to comply with all applicable federal
or state income tax laws or regulations, all applicable federal and state payroll, income or other taxes are withheld from any amounts payable by the Company to Optionee. If the Company is unable to withhold such federal and state taxes, for
whatever reason, Optionee hereby agrees to pay to the Company an amount equal to the amount the Company would otherwise be required to withhold under federal or state law. Optionee may, subject to the approval and discretion of the Committee or such
administrative rules it may deem advisable, elect to have all or a portion of such tax withholding obligations satisfied by delivering shares of the Company’s Common Stock having a fair market value equal to such obligations. For the purpose of
this Section 5(d), a “disqualifying disposition” means a sale or other transfer of any Shares on or before the later of (i) the date two (2) years after the date hereof and (ii) the date one (1) year after
transfer of such Shares to Optionee upon exercise of the Option, as more particularly set forth at Section 422(a)(1) of the Code 
 e.
Nontransferability. The Option may not be transferred in any manner other than by will or by the laws of descent and distribution and may be exercised during the lifetime of Participant only by Participant. The terms of the Option shall be
binding upon the executors, administrators, successors and assigns of Participant. 
 f. 2006 Equity Incentive Plan. The Option
evidenced by this Agreement is granted pursuant to the Plan, as amended as of the Effective Date, a copy of which Plan has been made available to Optionee and is hereby incorporated into this Agreement. This Agreement shall be subject to and in all
respects limited and conditioned as provided in the Plan. The Plan governs this Option and, in the event of any questions as to the construction of this Agreement or in the event of a conflict between the Plan and this Agreement, the Plan shall
govern, except as the Plan otherwise provides. 
 g. Stock Legend. The Committee may require that the certificates for any Shares
purchased by Optionee (or, in the case of death, Optionee’s successors) bear an appropriate legend to reflect the restrictions of applicable law. 
  

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 h. Scope of Agreement. This Agreement shall bind and inure to the benefit of the Company and its
successors and assigns and Optionee and any successor or successors of Optionee permitted by Section 3 or Section 5(e) of this Agreement. 
 i. Interpretation. The Committee shall have the sole discretion to interpret and administer the Plan. Any determination made by the Committee with respect to any Option shall be final and binding on the Company and on all persons
having an interest in the Option granted under this Agreement and the Plan. 
 j. Entire Option. The Plan, as amended, is
incorporated herein by reference. This Agreement and the Plan constitute the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersede all prior understandings and agreements with respect to
such subject matter. 
 k. Successors and Assigns. The Company may assign any of its rights under the Option. The Option
shall be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, the Option shall be binding upon Optionee and Optionee’s heirs, executors, administrators,
legal representatives, successors and assigns. 
 l. Governing Law. The Option shall be governed by and construed in accordance
with the internal laws of the State of Delaware, without regard to that body of law pertaining to choice of law or conflict of law. 
 m.
Restatement. This incentive stock option agreement amends and restates that certain incentive stock option agreement dated as of July 2, 2007 between Optionee and the Company. 
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the day and year first above written. 
  

									
	API Nanotronics Corp.	 		 	OPTIONEE
					
	By:	 	 /s/ Stephen Pudles
	 		 		 	 /s/ Claudio Mannarino

	Its:	 	 CEO
	 		 		 	[Signature]
		 		 		 		 	Claudio Mannarino

  

 6NON-STATUTORY INCENTIVE STOCK OPTION AGREEMENT

 Exhibit 10.19 
 This Option has not been registered under the Securities Act of 1933, as amended, or any applicable state securities laws, and may not be sold or transferred unless such sale or transfer is in accordance with the registration requirements
of such Act and applicable laws or some other exemption from the registration requirements of such Act and applicable laws is available with respect thereto. This Option is also subject to the transfer restrictions set forth herein. 
 NON-STATUTORY INCENTIVE STOCK OPTION AGREEMENT 
 THIS OPTION GRANT AGREEMENT (the “Agreement”), dated as of May 30, 2008 (the “Grant Date”), is entered into between API NANOTRONICS CORP., a Delaware corporation (the “Company”), and
MARTIN MOSKOVITS (the “Option-holder”). 
 WHEREAS, the Option-holder is an employee of the Company; 
 WHEREAS, the Company desires to afford the Option-holder an opportunity to purchase shares of common stock (“Common Stock”) in the
Company as provided in this Agreement, effective as of the Grant Date; and 
 WHEREAS, the Board of Directors of the Company has
approved the issuance of this option to Option-holder. 
 NOW, THEREFORE, in consideration of the premises and the mutual covenants
set forth in this Agreement and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto have agreed, and do hereby agree, as follows: 
 1. Issuance. 
 This option is issued by the Company as of the Grant Date. 
 2. Grant of Option, Option Price and Term. 
 (a) Grant. Subject to the terms and conditions of this Agreement, the Company hereby grants to the Option-holder, as a matter of separate agreement and not in lieu of salary or any other compensation for services, the right and
option (“Option”) to purchase five hundred thousand (500,000) shares of Common Stock of the Company (“Option Shares”). This Option is intended to be neither an “incentive stock option” as defined in
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), nor an option granted pursuant to an “employee stock purchase plan” as defined in Section 423 of the Code. 
 (b) Option Price. For each of the Option Shares purchased, upon purchase thereof the Option-holder shall pay to the Company $0.1005 (the
“Option Price”) which the parties agree represents an amount not less than the fair market value of the Option Shares on the Grant Date. Accordingly, the aggregate Option Price to purchase all of the Option Shares subject to the Option
granted hereunder is $50,250 (the “Aggregate Option Price”). 

 (c) No Fractional Shares. The Company shall not be required to issue any fractional Option Shares
hereunder. The fair market value of any fractional Option Shares to be issued to the Option-holder upon exercise of an Option issued under this Agreement shall be paid by the Company to the Option-holder in cash. 
 (d) Option Term. The term of the Option granted hereunder shall be a period of five (5) years from March 15, 2006 (the “Option
Period”). The termination of the Option Period shall result in the termination and cancellation of such Option. In no event shall the Option be exercisable at any time after the expiration of the Option Period. 
 3. Vesting. 
 The Options granted herein are
immediately vested. 
 4. Exercise of Option. 
 a) Exercise for Cash 
 The vested portion of this Option may be exercised, in whole at any time or in
part from time to time, commencing May 30, 2008, and prior to 5:00 P.M., P.S.T., on March 14, 2011, by the Option-holder by the surrender of this Option (with the subscription form at the end hereof duly executed) to the Company at its
principal office, together with proper payment of the Option Price times the number of shares of Common Stock to be received. Payment for Option Shares shall be made by certified or official bank check payable to the order of the Company or if
applicable, without cash pursuant to a cashless net exercise. If this Option is exercised in part, this Option must be exercised for a number of whole shares of the Common Stock, and the Option-holder is entitled to receive a new Option covering the
Option Shares which have not been exercised. Upon such surrender of this Option the Company will (a) issue a certificate or certificates in the name of the Option-holder for the largest number of whole shares of the Common Stock to which the
Option-holder shall be entitled and, if this Option is exercised in whole, in lieu of any fractional share of the Common Stock to which the Option-holder shall be entitled, pay to the Option-holder cash in an amount equal to the fair value of such
fractional share (determined in such reasonable manner as the Board of Directors of the Company shall determine), and (b) deliver the other securities and properties receivable upon the exercise of this Option, or the proportionate part thereof
if this Option is exercised in part, pursuant to the provisions of this Option. 
  

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 b) Cashless Net Exercise 
 At the Company’s option, in lieu of exercising this Option in the manner set forth in paragraph 4(a) above, this Option may be exercised, in whole or
in part, by surrender of the Option without payment of any other consideration, commission or remuneration, by execution of the cashless exercise subscription form (at the end hereof, duly executed). The number of shares to be issued in exchange for
the Option will be computed by subtracting the Option Exercise Price from either (i) the last sale price of the Common Stock on the date of receipt of the cashless exercise subscription form, or (ii) the most recent negotiated value used
in connection with any sale of the Company’s securities or in connection with any business combination involving the Company, and multiplying that amount by the number of shares represented by the Option, and dividing by the last sale price as
of the same date. If this Option is exercised in whole, in lieu of any fractional share of the Common Stock to which the Option-holder shall be entitled, the Company shall pay to the Option-holder cash in an amount equal to the fair value of such
fractional share (determined in such reasonable manner as the Board of Directors of the Company shall determine). If this Option is exercised in part, this Option must be exercised for a number of whole shares of the Common Stock, and the
Option-holder is entitled to receive a new Option covering the Option Shares which have not been exercised. 
 5. Reservation of Option Shares.

 The Company agrees that, prior to the expiration of this Option, the Company will at all times have authorized and in reserve, and will
keep available, solely for issuance or delivery upon the exercise of this Option, the shares of the Common Stock and other securities and properties as from time to time shall be receivable upon the exercise of this Option, free and clear of all
restrictions on sale or transfer (except for applicable state or federal securities laws restrictions) and free and clear of all pre-emptive rights. 
 6.
Anti-Dilution Provisions. 
 a) If, at any time or from time to time after the date of this Option, the Company shall issue or
distribute (for no consideration) to the holders of shares of Common Stock evidences of its indebtedness, any other securities of the Company or any cash, property or other assets (excluding a subdivision, combination or reclassification, or
dividend or distribution payable in shares of Common Stock, referred to in Subsection 6(b), and also excluding cash dividends or cash distributions paid out of net profits legally available therefor if the full amount thereof, together with the
value of other dividends and distributions made substantially concurrently therewith or pursuant to a plan which includes payment thereof, is equivalent to not more than 5% of the Company’s net worth) (any such non-excluded event being herein
called a “Special Dividend”), the Option Price shall be adjusted by multiplying the Option Price then in effect by a fraction, the numerator of which shall be the then current market price of the Common Stock (defined as the average for
the ten consecutive business days immediately prior to the record date of the daily closing price of the Common Stock as reported by the principal exchange or 

  

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market on which the Common Stock is listed) less the fair market value (as determined by the Company’s Board of Directors) of the evidences of
indebtedness, securities or property, or other assets issued or distributed in such Special Dividend applicable to one share of Common Stock and the denominator of which shall be such then current market price per share of Common Stock. An
adjustment made pursuant to this Subsection 6(a) shall become effective immediately after the record date of any such Special Dividend. 
 b)
In case the Company shall hereafter (i) pay a dividend or make a distribution on its capital stock in shares of Common Stock, (ii) subdivide its outstanding shares of Common Stock into a greater number of shares, (iii) combine its
outstanding shares of Common Stock into a smaller number of shares or (iv) issue by reclassification of its Common Stock any shares of capital stock of the Company, the Option Price shall be adjusted so that the Option-holder of this Option
upon the exercise hereof shall be entitled to receive the number of shares of Common Stock or other capital stock of the Company which he would have owned had he exercised his Options immediately prior thereto. An adjustment made pursuant to this
Subsection 6(b) shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or recapitalization. If, as
a result of an adjustment made pursuant to this Subsection 6(b), the Option-holder of any Option thereafter surrendered for exercise shall become entitled to receive shares of two or more classes of capital stock or shares of Common Stock and other
capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a written notice to the Option-holder of any Option promptly after such adjustment) shall reasonably determine the allocation of
the adjusted Option Price between or among shares of such classes or capital stock or shares of Common Stock and other capital stock. 
 c) In
case of any capital reorganization or reclassification, or any consolidation or merger to which the Company is a party other than a merger or consolidation in which the Company is the continuing corporation, or in case of any sale or conveyance to
another entity of the property of the Company as an entirety or substantially as an entirety, or in the case of any statutory exchange of securities with another corporation (including any exchange effected in connection with a merger of a third
corporation into the Company), the Option-holder of this Option shall have the right thereafter to convert such Option into the kind and amount of securities, cash or other property which he would have owned or have been entitled to receive
immediately after such reorganization, reclassification, consolidation, merger, statutory exchange, sale or conveyance had this Option been converted immediately prior to the effective date of such reorganization, reclassification, consolidation,
merger, statutory exchange, sale or conveyance and in any such case, if necessary, appropriate adjustment shall be made in the application of the provisions set forth in this Section 6 with respect to the rights and interests thereafter of the
Option-holder to the end that the provisions set forth in this Section 6 shall thereafter correspondingly be made applicable, as nearly as may reasonably be, in relation to any shares of stock or other securities or be, in relation to any
shares of stock or other securities or property thereafter deliverable on the conversion 

  

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of this Option. The above provisions of this Subsection 6(c) shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers,
statutory exchanges, sales or conveyances. The issuer of any shares of stock or other securities or property thereafter deliverable on the conversion of this Option shall be responsible for all of the agreements and obligations of the Company
hereunder. Notice of any such reorganization, reclassification, consolidation, merger, statutory exchange, sale or conveyance and of said provisions so proposed to be made, shall be mailed to the Option-holders of the Options not less than 10 days
prior to such event. A sale of all or substantially all of the assets of the Company for a consideration consisting primarily of securities shall be deemed a consolidation or merger for the foregoing purposes. 
 d) Notwithstanding anything herein to the contrary, the Company may, in its sole discretion, accelerate the timing of the exercise provisions of this
Option in the event of (i) the adoption of a plan of merger or consolidation under which all the shares of capital stock of the Company would be eliminated, (ii) a sale of all or substantially all of the Company’s assets or shares of
capital stock, or (iii) a change of control wherein the stockholders of the Company immediately prior to the transaction own less than 50% of the outstanding stock of the Company immediately after the transaction. Alternatively, the Company
may, in its sole discretion, cancel all or any portion of this Option upon any of the foregoing events and provide for the payment to the Option-holder in cash of an amount equal to the difference between the Option Price and the price of a share of
Common Stock, as determined in good faith by the Board of Directors of the Company, at the close of business on the date of such event, multiplied by the number of shares of Common Stock subject to this Option that are so canceled. 
 e) Upon the dissolution or liquidation of the Company other than in connection with a transaction to which another provision or provisions of this
Section 6 is/are applicable, this Option shall terminate and become null and void; provided, however, that if the rights of the Option-holder under this Option has not otherwise terminated and expired, the Option-holder shall have the right
immediately prior to such dissolution or liquidation to exercise the vested portion of this Option to the extent that the right to purchase shares under this Option has become exercisable as of the date immediately prior to such dissolution or
liquidation. 
 f) No adjustment in the Option Exercise Price shall be required unless such adjustment would require an increase or decrease
of at least $0.05 per share of Common Stock; provided, however, that any adjustments which by reason of this Subsection 6(f) are not required to be made shall be carried forward and taken into account in any subsequent adjustment; provided further,
however, that adjustments shall be required and made in accordance with the provisions of this Section 6 (other than this Subsection 6(f)) not later than such time as may be required in order to preserve the tax-free nature of the issuance to
the Option-holder of this Option. All calculations under this Section 6 shall be made to the nearest cent. Anything in this Section 6 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Option
Price, in addition to those required by this Section 6, as it in its discretion shall deem to be advisable in order that any stock dividend, subdivision of shares or distribution of rights to purchase stock or securities convertible or
exchangeable for stock hereafter made by the Company to its shareholders shall not be taxable. 
  

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 g) Whenever the Option Price is adjusted as provided in this Section 6 and upon any modification of
the rights of the Option-holder in accordance with this Section 6, the Board of Directors of the Company shall prepare a certificate setting forth the Option Price and the number of Option Shares after such adjustment or the effect of such
modification, a brief statement of the facts requiring such adjustment or modification and the manner of computing the same and cause copies of such certificate to be mailed to the Option-holder. 
 h) If the Board of Directors of the Company shall declare any dividend or other distribution with respect to the Common Stock, other than a cash
distribution out of earned surplus, the Company shall mail notice thereof to the Option-holder not less than 10 days prior to the record date fixed for determining shareholders entitled to participate in such dividend or other distribution.

 7. Fully Paid Stock, Taxes. 
 The Company agrees that the shares of the Common Stock represented by each and every certificate for Option Shares delivered on the exercise of this Option shall, at the time of such delivery, be validly issued and outstanding, fully paid
and nonassessable, and not subject to pre-emptive rights, and the Company will take all such actions as may be necessary to assure that the par value or stated value, if any, per share of the Common Stock is at all times equal to or less than the
then Option Price. The Company further covenants and agrees that it will pay, when due and payable, any and all Federal and state stamp, original issue or similar taxes which may be payable in respect of the issue of any Option Share or certificate
therefor. 
 8. Transferability. 
 Subject to compliance with federal and applicable state securities laws and the provisions of Section 14, the Option-holder may, prior to exercise or expiration thereof, surrender such Option at the principal office of the Company for
transfer or exchange. Within a reasonable time after notice to the Company from a registered Option-holder of its intention to make such exchange and without expense (other than transfer taxes, if any) to such registered Option-holder, the Company
shall issue in exchange therefor another Option or Options, in such denominations as requested by the registered Option-holder, for the same aggregate number of Option Shares so surrendered and containing the same provisions and subject to the same
terms and conditions as the Option(s) so surrendered. The Company may treat as the registered Option-holder of this Option as his or its name appears on the Company’s books at any time as the Option-holder for all purposes. All Options issued
upon the transfer or assignment of this Option will be dated the same date as this Option, and all rights of the transferee Option-holder thereof shall be identical to those of the original Option-holder. 
  

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 9. Loss, etc., of Option. 
 Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this Option, and of indemnity reasonably satisfactory to the Company, if lost, stolen or destroyed, and upon
surrender and cancellation of this Option, if mutilated, the Company shall execute and deliver to the Option-holder a new Option of like date, tenor and denomination. 
 10. Option-holder Not Shareholder. 
 Except as otherwise provided herein, this Option does not
confer upon the Option-holder any right to vote or to consent to or receive notice as a shareholder of the Company, as such, in respect of any matters whatsoever, or any other rights or liabilities as a shareholder, prior to the exercise hereof.

 11. Communication. 
 Any notice
or other communication shall be effective and shall be deemed to have been given if, the same is in writing, (i) and is personally delivered, (ii) five days after such written material is mailed by first-class mail, postage prepaid, or
(iii) one day after such written material is sent by a nationally recognized overnight courier, addressed to: 
  

	 	a)	the Company at 505 University Avenue, Suite 1400, Toronto, Ontario Canada M5G 1X3. Attn: Chairman or such other address as the Company has designated in writing to the
Option-holder; or 

  

	 	b)	the Option-holder at 1431 Portesuello, Santa Barbara, CA 93105, or such other address as the Option-holder has designated in writing to the Company. 

 12. No Disclosure Rights. 
 None of the Company
or any of its affiliates shall have a duty or obligation to affirmatively disclose to the Option-holder or a representative of Option-holder, and the Option-holder or a representative shall have no right to be advised of, any material information
regarding the Company or any of its affiliates at any time prior to, upon or in connection with the exercise of an Option or the Company’s purchase of Option Shares in accordance with the terms of this Agreement. 
 13. Headings. 
 The headings of this Option
have been inserted as a matter of convenience and shall not affect the construction hereof. 
  

 7 

 14. Withholding. 
 The Option-holder acknowledges that, upon any exercise of this Option, the Company shall have the right to require the Option-holder to pay to the Company an amount equal to the amount the Company is required to
withhold as a result of such exercise for federal and state income tax purposes. 
 15. Applicable Law. 
 This Option shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to the principles of conflicts
of law thereof. 
 16. Securities Law Compliance. 
 The exercise of all or any parts of this Option shall only be effective at such time as counsel to the Company shall have determined that the issuance and delivery of Common Stock pursuant to such exercise will not
violate any state or federal securities or other laws. The Option-holder may be required by the Company, as a condition of the effectiveness of any exercise of this Option, to agree in writing that all Common Stock to be acquired pursuant to such
exercise shall be held, until such time that such Common Stock is registered or exempt from registration and freely tradable under applicable state and federal securities laws, for Option-holder’s own account without a view to any further
distribution thereof, that the certificates for such Option Shares shall bear an appropriate legend to that effect and that such Option Shares will be not transferred or disposed of except in compliance with applicable state and federal securities
laws. 
 17. Nontransferability. 
 Except as otherwise agreed to by the Company, during the lifetime of Option-holder, this Option shall be exercisable only by Option-holder or by the Option-holder’s guardian or other legal representative, and shall not be assignable or
transferable by Option-holder, in whole or in part, other than by will or by the laws of descent and distribution. Notwithstanding any other Section of this Agreement, any such attempted sale, assignment, conveyance, gift, pledge, hypothecation or
transfer shall be null and void and shall nullify such Option immediately. 
 18. Scope of Agreement. 
 This Agreement shall bind and inure to the benefit of the Company and its successors and assigns and Option-holder and any successor or successors of
Option-holder permitted by Section 17 above. 
 19. Market-Stand-Off Agreement. 
 The Option-holder agrees (and the Option-holder shall cause any holder of the Option Shares who receives his or her Option Shares pursuant to a private
transfer from the Option-holder to agree) that the Option-holder shall not sell or otherwise transfer or dispose of any Option Shares held by such Option-holder (other than any Option Shares concurrently being 

  

 8 

 
registered) for 180 days or such other period specified by the underwriters of the Option Shares, or other class of securities of the Company being
registered, not to exceed twelve months following the effective date of a registration statement of the Company filed under the Securities Act, excluding Form S-8 and Form S-4 and other non-applicable forms. The Option-holder shall enter into such
written agreement(s) as shall be requested by the Company which are consistent with the foregoing or which are necessary to given effect thereto. 
 20.
Changes in Company’s Capital or Organizational Structure. 
 The existence of the Option shall not affect in any way the right
or authority of the Company or its members to make or authorize any or all adjustments, recapitalizations, reclassifications, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of
the Company, or any class of interests in the Company or affecting the Option Shares or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other act or
proceeding, whether of a similar character or otherwise. 
 21. Entire Agreement. 
 This Agreement constitutes the entire obligation of the parties hereto with respect to the subject matter of this Agreement and shall supersede any prior
expressions of intent or understanding with respect to such subject matter. 
 22. Amendment. 
 Any amendment to this Agreement shall be in writing and signed on behalf of the Company, and if required pursuant to this Agreement, by Option-holder.

 23. Waiver; Cumulative Rights. 
 The failure or delay of either party hereto to require performance by the other party of any provision hereof shall not affect its right to require performance of such provision unless and until such performance has been waived in writing.
Each and every right hereunder is cumulative and may be exercised in part or in whole from time to time. 
 24. Counterparts. 
 This Agreement may be signed in two (2) counterparts, each of which shall be an original, but both of which shall constitute but one and the same
instrument. 
  

 9 

 25. Headings, Gender and Number. 
 The headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement. Common
nouns and pronouns shall be deemed to refer to the masculine, feminine, neuter, singular and plural, as the context so requires. 
 26.
Severability. 
 If any one or more of the provisions of this Agreement shall be held by a court or arbitration tribunal of
competent jurisdiction or other authority to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby; such court,
arbitration tribunal or other authority is hereby authorized and directed to modify or amend the invalid, illegal or unenforceable provision to the minimum extent necessary to render it valid and enforceable and to achieve as fully as lawful the
intention of the parties in agreeing to such provision, and such provision, as so modified or amended, shall be valid and binding upon the parties. 
 27.
Amendment and Restatement. This Agreement amends and restates the Non-Statutory Option Agreement between the Company and the Option-holder dated as of March 15, 2006. 
 IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer thereunto duly authorized, and the Option-holder has
hereunto set his hand, all as of the day and year first above written. 
  

			
	API NANOTRONICS CORP.
	a Delaware corporation
		
	By:	 	 /s/ Stephen Pudles

	Its:	 	 CEO

	
	OPTION-HOLDER:
		
	By:	 	 /s/ Martin Moskovits

		 	Martin Moskovits

  

 10

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