Document:

ex10_8.htm

    
      

    

    EXHIBIT
E

    

    LOCK-UP
AGREEMENT

    

    This Lock-Up Agreement ("Agreement") is made
as of the date set forth below by the undersigned ("Holder") in
connection with such Holder’s ownership of shares of Axis Technologies Group,
Inc., a Delaware corporation (the "Company").

    

    Whereas, Holder is the actual and/or
beneficial owner of shares of Common Stock, $0.001 par value (“Common Stock”), of
the Company;

    

    Whereas,
Holder acknowledges and understands that the Company has entered into or will
enter into a Securities Purchase Agreement dated on or about April ___, 2008
(“Purchase
Agreement”) with certain purchaser(s) (the “Purchasers”),
pursuant to which such Purchasers will purchase secured convertible notes and
warrants of the Company (“Transactions”);
capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Purchase Agreement; and

    

    Whereas,
Holder acknowledges and understands that, as a condition to proceeding with the
Transactions, the Purchasers have required that, and the Company has agreed to
obtain an agreement from each Holder that, such Holder shall refrain from
selling any securities of the Company during the “Restricted Period”, where the
“Restricted
Period” consists of the fifteen (15) month period immediately following
the Closing Date of the Transactions;

    

               NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which consideration are hereby acknowledged, Holder agrees as
follows:

    

    1.           Share
Restriction.

    

    (a)           Holder
hereby agrees that during the Restricted Period, Holder will not (1) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (2) enter into any swap or other agreement
that transfers, in whole or in part, any of the economic consequences of
ownership of the Common Stock, whether any such transaction described in clause
(1) or (2) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise.  The foregoing sentence shall not
apply in connection with an offer made to all shareholders of the Company in
connection with any merger, consolidation or similar transaction involving the
Company.  In addition, Holder agrees that during the Restricted Period
the Holder will not make any demand for or exercise any right with respect to
the registration under the Securities Act of any shares of Common Stock or any
security convertible into or exercisable or exchangeable for Common
Stock.

    

    (b)           In
furtherance of the foregoing, Holder further agrees that (i) the Company is
authorized to place "stop orders" on its books to prevent any transfer of shares
of Common Stock or other securities of the Company held by Holder in violation
of this Agreement, and (ii) the Company and any duly appointed transfer agent
for the registration or transfer of the securities described herein are hereby
authorized to decline to make any transfer of securities if such transfer would
constitute a violation or breach of this Agreement.

    
      
         

      

      
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    (c)           Any
subsequent issuance and/or acquisition of shares or the right to acquire shares
by or to Holder will be subject to the provisions of this
Agreement.

    

    (d)           Notwithstanding
the foregoing restrictions on transfer, Holder may, at any time and from time to
time during the Restricted Period, transfer the Common Stock or other applicable
securities (i) as bona fide gifts or transfers by will or intestacy, (ii) to any
trust for the direct or indirect benefit of Holder or the immediate family of
Holder, provided that any such transfer shall not involve a disposition for
value, (iii) to a partnership of which the Holder is a general partner, provided
that, in the case of any gift or transfer described in clauses (i), (ii) or
(iii), each donee or transferee agrees in writing to be bound by the terms and
conditions contained herein in the same manner as such terms and conditions
apply to Holder.  For purposes hereof, "immediate family" means any
relationship by blood, marriage or adoption, not more remote than first
cousin.   If the Closing of the Transactions under the Purchase
Agreement is not consummated, the Holder shall be released from all obligations
under this Agreement.

    

    2.           Miscellaneous.

    

    (a)           At
any time and from time to time after the signing of this Agreement, Holder will
execute such additional instruments and take such action as may be reasonably
requested by the Purchasers to carry out the intent and purposes of this
Agreement.

    

    (b)           This
Agreement shall be governed, construed and enforced in accordance with the laws
of the State of New York without regard to conflicts of laws principles that
would result in the application of the substantive laws of another jurisdiction,
except to the extent that the securities laws of the state in which Holder
resides and federal securities laws may apply.  Any proceeding brought
to enforce this Agreement may be brought in courts sitting in New York County,
New York.

    

    (c)           This
Agreement contains the entire agreement of Holder with respect to the subject
matter hereof.  Holder hereby represents and warrants that Holder has
full power and authority to enter into this Agreement. This Agreement shall be
binding upon Holder, its legal representatives, heirs, successors and
assigns.  This Agreement may be signed and delivered by facsimile and
such facsimile signed and delivered shall be enforceable.

    

    (d)           The
Holder understands that the execution of this Agreement by Holder is a condition
to the Purchasers’ obligation to consummate the Transactions contemplated by the
Purchase Agreement.

    

    (e)           The
Purchasers are third party beneficiaries of this Agreement, with right of
enforcement.

    

    [Signature Page
Follows]

    
      
         

      

      
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    IN WITNESS WHEREOF, and intending to be
legally bound hereby, Holder has executed this Agreement as of the date set
forth below.

    

    
      	 
      	
              HOLDER:

            	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	 
      	 
	 
      	
                (Signature of
      Holder)

            	 
	 
      	 
      	 
      	 
	 
      	 
      	 
	 
      	
                (Print Name of
      Holder)

            	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	 
      	 
	 
      	
               
      (Date)

            	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	
              COMPANY:

            	 
	 
      	 
      	 
      	 
	 
      	
              AXIS
      TECHNOLOGIES GROUP, INC.

            	 
	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
	 
      	
              By:

            	 
      	 
	 
      	
              Name:

            	 
	 
      	
              Title:

            	 

    

     

     

    3Unassociated Document

    July
      21,
      2008

     

     

    Dear
      Jeffrey Ungar: 

     

    QPC
      Lasers is currently experiencing a cash shortage.  In order to enable the
      company to continue its operations during this difficult period, we have
      undertaken a number of steps to cut our operating costs and preserve our cash
      resources.

     

    It
      is in
      this context that QPC Lasers must unfortunately ask your agreement to a
      reduction of your salary to $8,719.23 per pay period, effective tomorrow,
      Tuesday, July 22, 2008.  This reduction will remain in effect until such
      time that, in the judgment of the Board of Directors, conditions have improved
      sufficiently to allow them to be relaxed or rescinded. In addition to the
      reduction of salary, we are also passing through to you 15% of your health
      insurance premium cost. This amount will be deducted from your future paychecks
      on a pre-tax basis. Accordingly, the effect on your net pay will be less than
      the dollar amount passed through.

     

    We
      recognize that some employees may be unwilling or unable to accept these changed
      compensation levels, employees who choose to remain employed by the Company
      must
      indicate their acceptance by the end of work on Tuesday, July 22,
      2008.

     

    We
      highly
      value your service to the Company and would not seek these reductions if we
      did
      not believe that they were essential to solving our current cash
      problems. Executive officers of the Company will be taking a salary
      reduction which is proportionately greater than your reduction. 

     

    Our
      goal
      is to continue to build our business and emerge from this cash shortage as
      quickly as possible.  We continue to have confidence in our technology and
      products and hope that you share that confidence.  There is of course no
      guarantee of success, but by undertaking reductions in operating expenses,
      including these salary reductions, we enhance our prospects for
      success.

     

    In
      recognition of your sacrifice and dedication to the Company, our Board of
      Directors has approved issuing to you 240,900 shares of common stock of QPC
      Lasers, Inc. These shares will vest on July 21, 2009. Until that time, they
      are
      forfeitable upon termination of employment for any reason. 

     

    In
      addition, we plan to offer a contingent retention incentive bonus equal to
      150%
      of the difference between the salary you are actually paid and the amount that
      you would have been paid if your current salary was not reduced.  The
      contingent retention incentive bonus would be payable upon the first anniversary
      of the effective date of your salary reduction (the "Payment Date"), subject
      to
      the following conditions:

     

           
      1. 
      You remain an employee in good standing of the Company on the Payment Date;
      and 

     

           
      2. 
      The Company has, in the judgment of the Board of Directors, adequate cash
      resources on the Payment Date to make the bonus payments without jeopardizing
      its ability to meet its other obligations during the 12 months
      following.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    We
      cannot
      provide any assurances that the contingent retention incentive bonus will be
      paid, nor should you view this potential bonus as a guaranty of continued
      employment or as consideration for your agreement to a salary reduction. 

     

    Thank
      you
      for your understanding and your continuing service to the Company. We intend
      to
      exert every effort to resolve our current difficulties, build a company of
      which
      we all can be proud and reward those who have contributed to this
      success.

     

     

    Sincerely,

     

     

    Jeff
      Ungar

     

    QPC
      Lasers, Inc.

     

     

    If
      you
      accept these reductions, please check the box below, sign, and return to Natalie
      in HR by the end of work on Tuesday July 22, 2008. Thank you!

     

    __
      I
      understand and accept the compensation changes as described in this
      letter

     

     

    _____________________

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