Document:

Stock Purchase Agreement dated March 23, 2004

 EXHIBIT 4.10 
  
 STOCK PURCHASE AGREEMENT 
  
 THIS STOCK PURCHASE AGREEMENT (the “Agreement”) is dated as of March 23, 2004 by and between NANOPHASE TECHNOLOGIES CORPORATION, a
Delaware corporation located at 1319 Marquette Drive, Romeoville, Illinois (the “Company”), and Altana Chemie AG, a German corporation (the “Purchaser”). 
  
 Purchaser and the Company acknowledge and agree that this Agreement is being executed in connection with the execution of
that certain Joint Development Agreement dated on or about the date hereof between Purchaser and the Company and that the acquisition of the Shares pursuant to this Agreement is part of the strategic relationship between Purchaser and the Company
commencing pursuant to and evidenced (in part) by such Joint Development Agreement. 
  
 SECTION 1 
  
 Sale of
Common Stock 
  
 Subject to the terms and conditions hereof,
the Company has offered, and will issue and sell (the “Offering”) to Purchaser, and Purchaser will buy from the Company, 1,256,281 shares of common stock, US$.01 par value per share, of the Company (the “Common
Stock”) for the purchase price of US$7.96 per share and an aggregate purchase price of US$10,000,000. The shares of Common Stock to be issued and sold by the Company and purchased by Purchaser pursuant to this Agreement are herein referred
to as the “Shares.” 
  
 The Shares will be
offered and sold without registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemption from registration provided by Section 4(2) of the Securities Act and Regulation D thereunder.

  
 Purchaser will be required to hold the Shares for a period of
at least two (2) years as contemplated in Section 5.1 below. Following the expiration of the Retention Period (as defined in Section 5.1 below), Purchaser (and any subsequent permitted transferees) will be entitled to the benefits of a Registration
Rights Agreement, dated as of the date hereof, by and between the Company and the Purchaser. Pursuant to the Registration Rights Agreement, the Company will file with the Securities and Exchange Commission (the “SEC” or the
“Commission”) a registration statement on Form S-3 pursuant to SEC Rule 415 (the “Registration Statement”) under the Securities Act relating to the resale of the Shares by Purchaser. The Company shall use its best
efforts to cause such Registration Statement to be declared effective as soon as practicable following the expiration of the Retention Period and to be maintained effective until the earlier of (i) the date on which all Shares have been resold under
such Registration Statement and (ii) the date on which all Registrable Securities (as defined in the Registration Rights Agreement) may be resold without restriction or limitation (the “Effectiveness Period”). Should the
Registration Statement for the Shares not be declared effective within 60 days of the end of the Retention Period or should the effectiveness lapse prior to the end of the Effectiveness Period, Purchaser shall have demand registration rights to the
extent set forth in the Registration Rights Agreement. 

 SECTION 2 
  

Closing; Delivery 
  
 2.1. Closing. The closing of the purchase and sale of the Shares hereunder (the “Closing”) shall be held at the
Chicago offices of the Company’s counsel at 225 W. Wacker Drive, Chicago, Illinois, or at such other place upon which the Company and Purchaser shall agree. The Closing shall occur simultaneously with or immediately after the execution and
delivery of this Agreement by Purchaser and the Company, or on such later date as the Company and Purchaser may agree. 
  
 2.2. Delivery. At the Closing, or within a reasonable period of time thereafter, the Company will deliver to Purchaser at
Purchaser’s address in Germany a certificate, registered in the name of Purchaser for the number of Shares to be purchased by Purchaser against payment of the purchase price therefor by wire transfer per the Company’s wiring instructions.

  
 SECTION 3 
  
 Representations and Warranties of the Company 
  
 For purposes of this Agreement, a party will be deemed to have
“knowledge” of a particular fact or other matter if any individual who is serving as an officer of such party is, or at any time was, actually aware of such fact or other matter; provided, however, that, in the case of the
Company, the Company’s knowledge with respect to any equity owner of the Company’s securities shall be deemed to include facts and other matters included in such equity owner’s filings with the SEC under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), public announcements or notices to the Company. 
  
 The Company represents, warrants and covenants to Purchaser as follows: 
  
 3.1. Organization and Standing; Articles and By-Laws. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of its organization. The Company has the requisite power and authority to own and operate its properties and assets and to carry on its business as presently conducted and as now
proposed to be conducted. The Company is qualified to do business as a foreign corporation in all jurisdictions where the ownership of its properties and assets and the conduct of its business requires such qualification, except where the failure to
be so qualified will not have a material adverse effect on the business of the Company taken as a whole, as such business is now conducted. The Company has furnished, or as soon as practicable, and in no event later than the day immediately prior to
Closing, will furnish, to Purchaser true and correct copies of the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof (the “Certificate of Incorporation”) and certified by the Secretary of
State of the State of Delaware within the preceding 10 business days, and the Company’s Bylaws, as in effect on the date hereof (the “Bylaws”) certified by the Company’s Secretary. 
  
 3.2. Corporate Power. The Company has all requisite
legal and corporate power and authority to execute and deliver this Agreement and to execute and deliver the agreements set forth as Exhibits hereto (collectively with this Agreement, the “Agreements”), and at the Closing to sell
and issue the Shares as set forth in the Agreements, and to carry out and perform its obligations under the Agreements. 
  
 3.3. Subsidiaries. The Company has no subsidiaries, and does not otherwise own or control, directly or indirectly, any equity
interest in any corporation, association or business entity. 

 3.4. Capitalization. As of the date hereof, the authorized capital stock of the
Company consists of 25,000,000 shares of Common Stock and 24,088 shares of Preferred Stock (the “Preferred Stock”). As of March 17, 2004, there were 16,115,533 shares of Common Stock issued and outstanding, and no shares of
Preferred Stock issued and outstanding. No other shares of capital stock are issued and outstanding. As of March 17, 2004, there were options and warrants outstanding issued by the Company to purchase an aggregate of 1,715,759 shares and 453,001
shares of Common Stock, respectively. All of the outstanding shares of Common Stock are duly authorized, validly issued, fully paid and nonassessable, and all such shares were issued in material compliance with all applicable federal and state
securities laws, including available exemptions therefrom, and none of such issuances were made in violation of any pre-emptive or other rights. The Company has reserved (i) 1,582,849 shares of Common Stock for issuance pursuant to its Amended and
Restated 1992 Stock Option Plan, (ii) 900,000 shares of Common Stock for issuance pursuant to its 2001 Equity Compensation Plan, and (iii) 453,001 shares of Common Stock for issuance upon exercise of existing outstanding warrants. Except as set
forth above, there are no options, warrants or other rights (including conversion, pre-emptive or other rights) or agreements outstanding to purchase any of the Company’s authorized and unissued capital stock. In addition, all shares of the
Company’s common stock issued after adoption of the Company’s Rights Agreement referenced in Section 5.12 below have been issued with the rights set forth in the Rights Agreement to purchase Series A Junior Participating Preferred Stock as
and to and to the extent set forth in the Rights Agreement (the “Rights”). Accordingly, the Shares will be issued with such Rights attached as contemplated in the Rights Agreement. 
  
 3.5. Authorization; Valid Issuance. (a) All corporate
action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution, delivery and performance of the Agreements by the Company, and for the authorization, the sale, issuance and delivery of the
Shares, and the performance of all of the Company’s obligations under the Agreements has been taken or will be taken prior to the Closing. The Agreements have been duly executed and delivered by the Company and constitute valid and binding
obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and to general principles of equity and to limitations on
the rights to indemnity and contribution that exist by virtue of public policy (the “Bankruptcy and Equity Exception”). The Shares, when issued pursuant to this Agreement, will be validly issued, fully paid and nonassessable.

  
 (b) The Shares and the associated Rights will, upon issuance
pursuant to the terms hereof and upon payment therefor, be duly authorized and validly issued, fully paid and non-assessable and will be free of preemptive or similar rights. 
  
 3.6. Reports and Financial Statements. (a) The Company made available to Purchaser prior to the
execution of this Agreement a copy of the Company’s Annual Report for the year ended December 31, 2002, the Company’s Quarterly Reports on Form 10-Q that have been filed for all quarters ended since December 31, 2002, the definitive proxy
statement for the Company’s 2003 annual meeting of stockholders, if filed with the Commission as of the date hereof, and any Current Reports on Form 8-K filed since December 31, 2002 (as such documents have since the time of their filing been
amended or supplemented) together with all reports, documents and information hereafter filed with the SEC, including all information incorporated therein by reference (collectively, the “SEC Reports”). The SEC Reports (a) complied
and will comply as to form in all material respects with the requirements of the Securities Act and the Exchange Act, and (b) did not contain and will not contain any untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The audited consolidated financial statements and unaudited interim consolidated financial statements
(including, in each case, the notes, if any, thereto), if any, included in the SEC Reports complied and will comply as to form in all material respects with the SEC’s rules and regulations with respect thereto), were 

 
prepared in accordance with generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated
therein or in the notes thereto) and fairly present (subject, in the case of the unaudited interim financial statements, to normal, recurring year-end audit adjustments not material and to the absence of footnotes) the financial position and
stockholders’ equity of the Company as of the respective dates thereof and the consolidated earnings and cash flows for the respective periods then ended. 
  

(b) The Company has a duly constituted audit committee of its Board of Directors (the “Audit Committee”), all of whose members are
“independent” as defined in Rules 4200(a)(14) and 4350(d)(2) of the National Association of Securities Dealers, Inc. and such committee has operated in accordance with applicable law and regulations, the requirements of the Nasdaq National
Market (“Nasdaq”). The Company’s independent public accountants have reviewed each interim financial statement in accordance with the requirements of applicable federal securities laws, the Audit Committee’s charter, the
Commission’s rules and regulations and the applicable rules of Nasdaq. The Company has received no communications from its independent public accountants that the independent public accountants are considering or are likely to consider issuing
any report other than a clean, unqualified opinion as to the Company’s audited financial statements or have raised any unresolved issues with respect to any of the Company’s interim financial statements. 
  
 3.7. No Integration. Neither the Company nor, to the
Company’s knowledge, its affiliates (as defined in Rule 501(b) under the Securities Act) (“Affiliates”) has, directly or through any agent, during the six month period ending on the date of this Agreement, sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act) in a manner that would cause the offer and sale of the Shares to fail to be entitled to the exemption afforded by Rule 506 of
Regulation D, or under Section 4(2) of the Securities Act. 
  
 3.8. No Public Offering. Neither the Company nor, to the Company’s knowledge, its Affiliates has engaged, in connection with the offering of the Shares, (i) in any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act, (ii) in any manner involving a public offering within the meaning of Section 4(2) of the Securities Act, (iii) in any action which would violate applicable state securities, or
“blue sky,” laws, or in any directed selling efforts within the meaning of SEC Regulation S. 
  
 3.9. Conformity of Descriptions. The Shares conform in all material respects to the descriptions contained in the Company’s SEC
Reports and other filings with the SEC. 
  
 3.10. No
Material Adverse Changes. Except as disclosed on Schedule 3.10 or in the SEC Reports filed not less than five (5) business days prior to the date hereof, there has been no (i) material adverse change in the business, results of
operations, stockholders’ equity, cash flows, financial condition of the Company taken as a whole, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), or (ii) dividend or distribution of any
kind declared, paid or made by the Company on any shares of its capital stock. 
  
 3.11. No Conflicts. The execution, delivery and performance of the Agreements, the issuance and delivery of the Shares by the Company and the consummation by the Company of the transactions
contemplated herein and in the other Agreements do not and will not (i) conflict with or violate any provision of the Certificate of Incorporation, Bylaws or other organizational documents of the Company, (ii) conflict with, or constitute a default
(or an event which, with notice or lapse of time or both, would become a default) under, or give to other individual, partnership, joint stock company, corporation, limited liability company, trust, unincorporated organization, government agency or
political subdivision (each of the foregoing, a “Person”) any rights of termination, amendment, acceleration or cancellation of, 

 
any agreement, indenture, patent, license or instrument (whether evidencing a Company debt or otherwise) to which the Company is a party or by which any
property or asset of the Company is bound or affected or (iii) result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company is subject
(including federal and state securities laws and regulations and the rules and regulations of the principal market, system or exchange on which the Common Stock is traded, quoted or listed), or by which any assets of the Company is bound or
affected. 
  
 3.12. Consents and Approvals. The
Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration (“Consents”) with, any court or other federal, state, local or other governmental authority,
regulatory or self regulatory agency (“Governmental Authorities”), or other Person in connection with the execution, delivery and performance by the Company of the Agreements, other than (i) the filing of the Registration Statement
with the Commission in accordance with the Registration Rights Agreement, (ii) the application(s) or any letter(s) acceptable to Nasdaq for the listing or quoting of the Shares on Nasdaq (and with any other national securities exchange or market on
which the Common Stock is then traded, listed or quoted), and the notice, if any, required by Nasdaq Rule 4310 which has been filed as shown in Schedule 3.12, (iii) any filings, notices or registrations under applicable state securities laws,
(iv) the disclosure requirements of the Exchange Act, and the disclosure requirements of Item 701 of SEC Regulation S-K, (v) filing a Form D and a Form 8-K with the Commission, and (vi) any other approvals and consents set forth on Schedule
3.12 (collectively, the “Required Approvals”). 
  
 3.13. Proceedings. Except as described in the SEC Reports, there is no action, suit, hearing, claim, notice of violation, arbitration or other proceeding, hearing or investigation (each, a “Proceeding”)
pending or, to the knowledge of the Company, threatened against or affecting the Company or any of its assets before or by any Governmental Authority or any arbitrator, which (i) adversely affects or challenges the legality, validity or
enforceability of any of the Agreements, (ii) could reasonably be expected to, individually or in the aggregate, have or result in a Material Adverse Effect, or (iii) if adversely decided, could reasonably be expected to have a material adverse
effect on or delay the issuance of the Shares, or the consummation of the transactions contemplated by the Agreement. The foregoing includes, without limitation, any such action, suit, proceeding or investigation that questions this Agreement or
seeks to delay or prevent the consummation of the transactions contemplated hereunder or the right of the Company to execute, deliver and perform under same. The Company is not a party to or subject to the provisions of any order, writ, injunction,
judgment or decree of any Governmental Authority that is reasonably likely to have a Material Adverse Effect before or after consummation of the transactions contemplated by this Agreement. No action, suit, proceeding, claim, investigation or
inquiry by the Company or any subsidiary is currently pending nor does the Company presently intend to initiate any action, suit, proceeding, claim, investigation or inquiry, in each case, that if resolved in a manner adverse to the Company, is
reasonably likely to have a Material Adverse Effect. 
  
 3.14.
No Default or Violation. Except for those that would not, individually or in the aggregate, result in a Material Adverse Effect, the Company is not in (i) default under or in violation of any indenture, loan or other credit
agreement or any other agreement or instrument to which it is a party or by which the Company of its assets or properties is bound, or (ii) violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any
arbitrator or Governmental Authority applicable to it. The Company is not in default under, or in violation of, its Certificate of Incorporation, Bylaws or other organizational documents or in default under or in violation of any of the listing or,
quotation requirements of Nasdaq as in effect on the date hereof and the Company is not aware of any facts which would reasonably lead to delisting or suspension of trading in the Common Stock by Nasdaq in the foreseeable future. The business of the
Company is not being conducted, and the Company presently has no plans to conduct its business, in violation of any law, statute, ordinance, rule or regulation of any 

 Governmental Authority, except where such violations have not resulted or are not reasonably likely to result,
individually or in the aggregate, in a Material Adverse Effect. The Company is not in breach of any agreement where such breach, individually or in the aggregate, is reasonably likely to have a Material Adverse Effect. 
  
 3.15. Broker’s Fees. No fees or commissions or similar
payments with respect to the transactions contemplated by the Agreements have been paid or will be payable by the Company to any broker, financial advisor, finder, investment banker or bank, other than fees payable to First Analysis Securities
Corporation (which fees will be paid by the Company), and the Company shall indemnify and hold harmless Purchaser from and against any such claims. 
  
 3.16. Listing Compliance. The principal market on which the Common Stock is currently traded is Nasdaq, and the Company has no other
securities listed or traded on any other securities exchange or automated quotation system or market. Except as disclosed on Schedule 3.16, the Company has not in the three (3) years preceding the date hereof received notice (written or oral)
from Nasdaq (or any stock exchange, market or trading facility on which the Common Stock is or has been traded or listed (or on which it has been quoted)) to the effect that the Company is not in compliance with the listing or maintenance
requirements of any such market, exchange or trading facility. After giving effect to the transactions contemplated by the Agreements, the Company is and will be in compliance with all such maintenance requirements. 
  
 3.17. Intellectual Property Rights. Except as disclosed on
Schedule 3.17, the Company owns or possesses adequate rights or licenses to use all trademarks, trademark applications, trade names and service marks, whether or not registered, and all patents, patent applications, copyrights, inventions,
licenses, approvals, governmental authorizations, trade secrets and intellectual property rights (collectively, “Intellectual Property Rights”) which are necessary for use in connection with its business as now conducted and as
described in the SEC Reports. The Company has no knowledge that it has infringed, and the Company is not infringing on, any of the Intellectual Property Rights of any Person. Except as disclosed in the Company’s SEC Reports, there is no
Proceeding which is pending, or to the Company’s knowledge, is threatened against, the Company regarding the infringement of any of the Intellectual Property Rights. The Company has taken reasonable security measures to protect the secrecy,
confidentiality and value of all of its Intellectual Property Rights. To the Company’s knowledge, the Company has not infringed, and is not infringing, on any of the Intellectual Property Rights of any Person except as would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect or as is disclosed either on Schedule 3.17 or in the SEC Reports. 
  
 3.18. Registration Rights; Rights of Participation. Except as described on Schedule 3.18, (i) the Company has not granted or agreed
to grant to any Person any rights (including “piggy-back” registration rights) to have any securities of the Company registered with the Commission or any other Governmental Authority which have not been satisfied, and (ii) no Person,
including current or former stockholders of the Company, underwriters, brokers or agents, has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the
Agreements or to require that the Company include any such securities in the registration of Shares as contemplated herein. With respect to the agreements evidencing the rights set forth on Schedule 3.18 hereto, the Company has complied in
all respects with the provisions therein regarding any right of first refusal, preemptive right, right of participation, or any similar right of a stockholder or any other third party to participate in the transactions contemplated by the
Agreements, including, but not limited to, notice, consent and waiver requirements. 

 3.19. Title. Except as disclosed on Schedule 3.19, the Company has good and
marketable title in fee simple to all property owned by it, in each case free and clear of all security interests, liens, pledges or negative pledges, charges, encumbrances, mortgages, hypothecations, adverse claims or equities (each, a
“Lien”), except for Liens that do not materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company. Any properties held or used under lease by the
Company are held by it under valid, subsisting and enforceable leases, with such exceptions as are not material and do not interfere with the use made and proposed to be made of such properties by the Company. 
  
 3.20. Permits. The Company possesses all certificates,
authorizations, licenses, easements, consents, approvals, orders, permits and approvals (“Permits”) necessary to own, lease and operate its properties and to conduct their businesses as currently conducted except where the failure
to possess such Permits is not reasonably likely, individually or in the aggregate, to have a Material Adverse Effect (“Material Permits”), and there is no Proceeding pending, or, to the knowledge of the Company, threatened relating
to the revocation, modification, suspension or cancellation of any Material Permit. The Company has fulfilled and performed all of the material obligations with respect to such Permits, and no event or change in condition has occurred which allows,
or which upon notice, the lapse of time or both would allow, the revocation or termination thereof or results in any other material impairment of the rights of the holder of any such Permits, except for failures which would not, individually or in
the aggregate, have a Material Adverse Effect. The Company is not in conflict with, in default under or in violation of any Material Permit. 
  
 3.21. Insurance. The Company and its respective properties are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as is prudent and customary in the business in which the Company is engaged. Except as disclosed on Schedule 3.21, all insurance policies carried by the Company are in full force in effect and the Company
has no reason to believe that it will not be able to renew such existing insurance policies as and when such coverage expires or to obtain similar coverage from similar insurers, at a cost that would not materially and adversely affect the
condition, financial or otherwise, or the earnings, cash flows, business or business prospects of the Company taken as a whole. 
  
 3.22. Investment Company; Public Utility Holding Company. The Company is not (i) an “investment company” or a company
“controlled by” an “investment company” as such terms are defined in the Investment Company Act of 1940, as amended (the “1940 Act”), or (ii) a “public utility holding company” or a company
“controlled by” a “public utility holding company,” as such terms are defined in the Public Utility Holding Company Act of 1935, as amended (the “PUHC Act”) and the SEC’s rules and regulations under each of
such Acts. 
  
 3.23. No Stabilization. Neither the
Company nor, to the Company’s knowledge, any of its directors, officers, or controlling persons has taken or will take, directly or indirectly, any action designed to, or which might reasonably be expected to cause or result in, or which has
constituted, under the Exchange Act, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares. 
  
 3.24. Labor. The Company is not a party to any collective bargaining agreement covering any individual who
performs services as an employee primarily for the Company (including such persons who are on an approved leave of absence, vacation, short-term disability or otherwise treated as an active employee of the Company, “Employees”), and
there are no controversies or unfair labor practice proceedings pending, or to the knowledge of the Company, threatened between the Company and any of its current or former Employees or any labor or other collective bargaining unit representing any
current or former Employee of the Company that would reasonably be expected to result in a labor strike, dispute, 

 slow-down or work stoppage or otherwise have a Material Adverse Effect. To the Company’s knowledge, no
organizational effort is presently being made or, to the Company’s knowledge, threatened by or on behalf of any labor union. 
  
 3.25. Stock and Other Plans. Other than as disclosed in the SEC Reports, the Company does not have any profit sharing, deferred
compensation, stock option, stock purchase, phantom stock or similar plans, including agreements evidencing rights to purchase securities or to share in the profits of the Company which is material to the Company, taken as a whole. 
  
 3.26. Solvency. The Company is, and immediately after the
Closing will be, Solvent. As used herein, the term “Solvent” means, with respect to a particular date, that on such date, (i) the fair market value of the assets of the Company exceeds their respective liabilities (including,
without limitation, stated liabilities and contingent liabilities), and (ii) the Company can pay its debts as they come due or mature. The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant
to any bankruptcy, insolvency, debtor relief, reorganization or similar law, nor does the Company have any knowledge or reason to believe that creditors of the Company have initiated or intend to initiate involuntary bankruptcy or similar
proceedings. 
  
 3.27. Environmental. Except as
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) the Company is in compliance with and not subject to any known liability under applicable Environmental Laws (as defined below), (ii) the
Company has made all filings and provided all notices required under all applicable Environmental Laws, and has, and is in compliance with, all permits required under any applicable Environmental Laws, each of which is in full force and effect,
(iii) (a) there are no pending Proceedings with respect to any Environmental Laws affecting the Company, (b) the Company has not received any demand, claim or notice of violation of any Environmental Laws and (c) to the knowledge of the Company,
there is no Proceeding, notice or demand letter or request for information threatened against the Company under any Environmental Law, (iv) no Lien or restriction has been recorded under any Environmental Law with respect to any assets, facility or
property owned, operated, leased or controlled by the Company, (v) the Company has not received notice that it has been identified as a potentially responsible party under the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended (“CERCLA”), or any comparable state law, (vi) no property or facility of the Company (a) is listed or, to the knowledge of the Company, proposed for listing on the National Priorities List under CERCLA or any state
list of hazardous substance sites requiring cleanup, (b) is listed in the Comprehensive Environmental Response, Compensation, Liability Information System List promulgated pursuant to CERCLA, or on any comparable list maintained by any state or
local governmental authority, (vii) no Hazardous Materials are being released (as defined below) at, on or under any facility owned, operated, leased or controlled by the Company or have been Released at, on or under any facility owned, operated,
leased or controlled by the Company (except as may be allowed by permit) and, to the knowledge of the Company, none of the facilities owned, operated, leased or controlled by the Company are adversely affected by any Release of Hazardous Materials
originating or emanating from any other property. 
  
 For purposes
of this Agreement, “Environmental Laws” means all applicable United States federal, provincial, state and local laws or regulations, codes, orders, decrees, judgments or injunctions issued, promulgated, approved or entered
thereunder, relating to pollution, protection of public or employee health and safety or the environment, including, without limitation, laws relating to (i) emissions, discharges, releases or threatened releases of Hazardous Materials (as defined
below) into the indoor or outdoor environment (including, without limitation, ambient air, soil, surface water, ground water, wetlands, land surface or subsurface strata), (ii) the manufacture, processing, distribution, use, generation, treatment,
storage, disposal, transport or handling of Hazardous Materials, and 
  

 8 

 (iii) underground and above ground storage tanks and related piping, and emissions, discharges, releases or threatened
releases therefrom. The term “Hazardous Material” means (a) any “hazardous substance,” as defined in the Comprehensive Environmental Response, the Resource Conservation and Recovery Act, as amended, (b) any
“hazardous waste,” as defined by the Resource Conservation and Recovery Act, as amended, (c) any petroleum or petroleum product, (d) any polychlorinated biphenyl, (e) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material, waste or substance, and (f) flammable explosives, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation, lead-based paint, radon and mold. “Release” means
any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor environment, including, without limitation, the movement of Hazardous Materials through ambient air,
soil, surface water, ground water, wetlands, land surface or subsurface strata. 
  
 3.28. ERISA. Schedule 3.28 sets forth a list of each of the following that the Company maintains or contributes to or for which the Company has any liability: (i) each employee benefit plan as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (ii) each other pension, profit sharing, incentive, employment, retirement, severance, deferred compensation or change in control plan, agreement or
arrangement (each of the foregoing in (i) or (ii) a “Plan”). With respect to any such Plan, the Company has not, through its own actions or due to the actions of its Affiliates, incurred any liability for, or taken any action that would
constitute, nor to the Company’s knowledge has any unrelated party taken any action that would constitute or result in, any prohibited transaction, funding deficiency, plan termination or complete or partial withdrawal with respect to the
Company or its Affiliates which would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. With respect to each such Plan, the Company is in compliance in all respects with all applicable provisions of ERISA,
the Internal Revenue Code of 1986, as amended (the “Code”), and other applicable laws, and the Company has performed all of its respective obligations under such Plans, except where the failure to so comply would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. Each Plan intended to qualify under the provisions of Section 401(a) of the Code has received a favorable determination letter with respect to such qualification except
where failure to qualify the Plan would not have a Material Adverse Effect. 
  
 3.29. Form S-3 Eligibility. In relation to the resale of the Shares by Purchaser, the Company (i) meets the requirements for use of SEC Form S-3 under the Securities Act and (ii) is eligible for filing
and maintaining a registration statement on Form S-3. 
  
 3.30.
Taxes. The Company (i) has made or filed all federal and state income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject, and (ii) has paid all taxes and other governmental assessments
and charges that are shown or determined to be due on such returns, reports and declarations or otherwise, in each case except for (A) taxes being contested in good faith and for which adequate reserves are shown in the Company’s SEC Reports,
or (B) any liability of the Company for taxes and other governmental assessments and charges that are not yet due and payable that has been accrued or reserved for on the financial statements of the Company in accordance with GAAP. All tax returns
filed by the Company were true, correct, and complete in all material respects as of the time of such filing There are no unpaid taxes in any material amount claimed to be due from the Company by the taxing authority of any jurisdiction, and the
officers of the Company know of no basis for any such claim. 
  
 3.31. Books and Records. The minute books and other records of the Company contain in all material respects accurate records of all Company board, committee and stockholders’ meetings and accurately reflect in all
material respects all other corporate action of the stockholders and directors and any committees thereof of the Company since January 1, 2002. 
  

 9 

 3.32. Accounting Controls. The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles and to maintain assets accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences, except for any controls the absence of which would not result in a Material Adverse Effect. 
  
 SECTION 4 
  
 Covenants of the Company 
  
 The Company hereby covenants with Purchaser as follows: 
  
 4.1. Notification of Certain Events. From the date hereof until the Closing, the Company will immediately
notify Purchaser, and confirm such notice in writing, of (i) any filing made by the Company relating to the Offering with Nasdaq or any securities exchange or the SEC or other securities regulator in the United States or any other jurisdiction, and
(ii) subject to the agreement of each of Purchaser to maintain such information in confidence, any material changes in or affecting the financial condition, earnings, cash flows, stockholders’ equity, business or business prospects of the
Company taken as a whole. 
  
 4.2. Offering
Limitations. In connection with any offering which would be integrated into the transactions contemplated in this Agreement, none of the Company or, to the Company’s knowledge, any of its Affiliates will solicit any offer to buy or
offer to sell shares of Common Stock or securities convertible into or exchangeable for Common Stock by means of any form of general solicitation or general advertising (as such terms are used in Regulation D under the Securities Act) in any manner
involving a public offering (within the meaning of Section 4(2) of the Securities Act) prior to the effective date (“Effective Date”) of the Registration Statement. 
  
 4.3. Disclosures. Subject to Section 8.14, promptly following the Closing the Company will (i) issue a press
release announcing the sale of the Shares, and (ii) file such press release and other appropriate information with the SEC on a Form 8-K. The Company shall, immediately following the filing of the Registration Statement on Form S-3 pursuant to the
Registration Rights Agreement, (i) issue such press releases and make such filings under the Exchange Act, including, without limitation, the filing of Form 8-K, to disclose the sale of the Shares and the filing of the Registration Statement on Form
S-3 pursuant to the Registration Rights Agreement and (ii) include in the filing of its next Form 10-Q or Form 10-K, as applicable, appropriate disclosures relating to the sale of the Shares and the filing of such Registration Statement on Form S-3,
including, without limitation, the disclosure required by Item 701 of Regulation S-K. The Company shall, from and after the Closing through the period that the Registration Statement is required to be maintained, timely file all SEC Reports, comply
with all requirements under the Exchange Act, continue to list the Shares on Nasdaq or a national securities exchange, and otherwise comply with the requirements of Sections 3.6, 3.12 and 3.29 hereof, which are incorporated herein. 
  
 4.4. Use of Proceeds. The Company will use the proceeds from
the sale of the Shares for general working capital purposes. 
  

 10 

 SECTION 5 
 Representations, Warranties and Covenants of Purchaser 
  
 Purchaser hereby represents, warrants and covenants to the Company with respect to the purchase of the Shares by Purchaser as follows: 
  
 5.1.    Retention of Shares; No Other Shares. During the period commencing on at
the Closing and ending on the second anniversary of the Closing (the “Retention Period”), Purchaser will not directly or indirectly sell, transfer or otherwise dispose of the Shares. Prior to the Closing, Purchaser beneficially
owned (as determined in accordance with SEC Rule 13d-3 under the Exchange Act) no shares of the Company’s equity securities. 
  
 5.2.    Experience. Purchaser has substantial experience in evaluating and investing in private placement
transactions of securities in companies similar to the Company, and the Purchaser is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. 
  
 5.3.    Accredited Investor Status and Regulation S
Representations. 
  
 (a) Purchaser is a large
“accredited investor,” as defined in SEC Regulation D promulgated pursuant to the Securities Act (meaning a corporation not formed for the specific purpose of acquiring the Shares, with total assets in excess of US$5,000,000). Purchaser
represents that it has a net worth in excess of US$100,000,000. For the avoidance of doubt, Purchaser is not representing that it is a “qualified institutional buyer,” as defined in Rule 144A of the Securities Act. 
  
 (b) Purchaser represents, warrants and covenants that (a) Purchaser is not a
“U.S. Person” as defined in Regulation S promulgated under the Securities Act (“Regulation S”), (b) none of Purchaser, its affiliates or any person acting of behalf of Purchaser or any such affiliate has engaged, or will engage
in any Directed Selling Efforts (as defined in Regulation S) with respect to the Shares during the Retention Period, (c) the transactions contemplated in this Agreement (1) have not been pre-arranged with a purchaser located in the United States who
is a U.S. Person (as defined in Regulation S), and (2) are not part of a plan or scheme to evade the registration provisions of the Act, and (d) Purchaser is not an “affiliate” of the Company as defined in Rule 144 promulgated under the
Securities Act. 
  
 5.4.    Rule
144. Purchaser acknowledges that the Shares must be held indefinitely unless subsequently registered for resale under the Securities Act or unless an exemption from such registration is available. Purchaser is aware of the provisions
of Rule 144 promulgated under the Securities Act which permit limited resale of securities purchased in a private placement, subject to the satisfaction of certain conditions, including, among other things, the existence of a public market for the
shares, the availability of certain current public information about the Company, the resale occurring not less than one year after a party has purchased and fully paid for the security to be sold, the sale being effected through a
“broker’s transaction” or in a transaction directly with a “market maker” and the number of shares being sold during any three-month period not exceeding specified limitations. 
  
 5.5.    Confidential Access to
Information. Purchaser has had an opportunity to discuss the Company’s business, management and financial affairs with its management. It has also had an opportunity to ask questions of officers of the Company, which questions
were answered to its satisfaction. Purchaser understands that such discussions, as well as any written information issued by the Company, were intended to describe certain aspects of the Company’s business and prospects. Pursuant to a
confidentiality agreement, as contemplated by the SEC’s Regulation FD, Purchaser acknowledges 

 
that it has been provided access to material, non-public information and that the Purchaser will keep all such information confidential except to the extent
it becomes public through no fault of the Purchaser. Further, the Purchaser acknowledges and understands the fact that the Company is seeking to effect the private placement of the Shares is material non-public information and disclosure of such
information or use of such information by Purchaser or anyone receiving such information from Purchaser in connection with the purchase, sale or trade of the Company’s securities (other than use by Purchaser in acquiring the Shares), or any
hedging, derivative or similar transactions or activities involving the Company’s securities, is a violation of securities laws. Neither such inquiries nor any other due diligence investigation conducted by Purchaser or any of its advisors or
representatives shall modify, amend or affect Purchaser’s right to rely on the Company’s representations, warranties and covenants contained herein or in the other Agreements. The Purchaser understands that its investment in the Shares
involves a high degree of risk. 
  
 5.6.    Organization; Authorization. The Purchaser is a corporation duly formed, validly existing and in good standing under the laws of Germany with the requisite power and authority, to enter into
and to consummate the transactions contemplated by the Agreements and otherwise to carry out its obligations under the Agreements. The purchase by Purchaser of the Shares hereunder has been duly authorized by all necessary action on the part of
Purchaser. This Agreement, when executed and delivered by Purchaser, will constitute a valid and binding obligation of the Purchaser, enforceable in accordance with its terms, subject to the Bankruptcy and Equity Exception. 
  
 5.7.    Restrictive Legends.
Purchaser understands that the certificates evidencing the Shares will bear the following legends: 
  
 “THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN AGREEMENT WITH THE ISSUER PURSUANT TO WHICH SUCH SECURITIES MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF PRIOR TO MARCH 23, 2006. 
  
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS NEITHER THESE SECURITIES NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, OTHER THAN TO DISTRIBUTORS (AS DEFINED IN REGULATION
S) IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION UNDER THE SECURITIES ACT, AND EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS AN
“ACCREDITED INVESTOR” (AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND (2) AGREES THAT IT WILL NOT PRIOR TO TWO YEARS AFTER THE LATER TO OCCUR OF (I) THE ORIGINAL ISSUANCE OF THESE SECURITIES EVIDENCED
HEREBY OR (II) ACQUISITION THEREOF FROM AN AFFILIATE OF THE COMPANY (THE “RESTRICTION TERMINATION DATE”) OFFER, RESELL OR OTHERWISE TRANSFER THESE SECURITIES EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (B) TO NANOPHASE TECHNOLOGIES CORPORATION (C) OUTSIDE THE UNITED STATES IN AN OFF-SHORE TRANSACTION IN COMPLIANCE WITH 

 REGULATION S, (D) PURSUANT TO RULE 144, OR (E) PURSUANT TO ANY OTHER EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT (IF AVAILABLE); SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENTS OF LAW THAT THE DISPOSITION OF THE PROPERTY OF SUCH HOLDER BE AT ALL TIMES WITHIN SUCH HOLDER’S CONTROL AND TO COMPLIANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THESE SECURITIES ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY (OTHER THAN A TRANSFER
PURSUANT TO SUBSECTIONS (A) OR (B) ABOVE) THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO NANOPHASE TECHNOLOGIES CORPORATION A LEGAL OPINION ACCEPTABLE TO THE ISSUER FROM A U.S. LAW FIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. IN ALL SITUATIONS, THE HOLDER WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THE SECURITIES EXCEPT AS PERMITTED BY THE
SECURITIES ACT.” 
  
 In addition, Purchaser acknowledges
that each certificate for Shares shall bear any additional legend required by any other applicable domestic or foreign securities or blue sky laws. 
  
 The Company will direct its transfer agent and registrar to maintain stop transfer instructions on record for the Shares until it has been notified by the
Company, upon the advice of counsel, that such instructions may be waived consistent with the Securities Act and applicable domestic and foreign securities laws. Such stop transfer instructions will limit the method of sale of the Shares, consistent
with Rule 144 or other available exemptions from registration under the Securities Act. Any transfers other than pursuant to a registration statement under the Securities Act will require an opinion of counsel reasonably satisfactory to the Company
and its counsel prior to such transfers. 
  
 5.9.    No Governmental Review. Purchaser understands that no United States federal or state agency or any other government or governmental agency or authority has passed upon or made any
recommendation or endorsement of the Shares. 
  
 5.10.    Residency. Purchaser is a resident of the country of Germany. 
  
 5.11.    Investment Intent. Purchaser is acquiring the Shares for investment for its own account, not as a
nominee or agent, and not with the view to any distribution, resale or transfer thereof. Purchaser understands and agrees that the Shares have not been registered under the Securities Act by reason of the exemption from the registration provisions
of the Securities Act contained in Rule 506 of Regulation D and Section 4(2) of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of
Purchaser’s representations, warranties and covenants as expressed herein, which are being relied upon by the Company. 
  
 5.12.    Rights Agreement. Purchaser acknowledges that the Company has entered into a Rights Agreement, dated
October 28, 1998 (as amended, the “Rights Agreement”), which Rights Agreement has been filed with the Commission as an exhibit to the Company’s periodic reports. Purchaser is not, and at the time of Closing will not be, an Acquiring
Person (as such term is defined in the Rights Agreement). 

 5.13. No Manipulation. Neither Purchaser nor, to the Purchaser’s knowledge, any
of its supervisory board members, management board members, managers, subsidiaries, controlling persons or other affiliates has taken, or presently plans to take, directly or indirectly, any action designed to or which might reasonably be expected
to cause or result in, or which has constituted, under the Exchange Act, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares. 
  
 5.14. No Relationship. Neither Purchaser nor, to the
Purchaser’s knowledge, any of its supervisory board members, management board members, managers, subsidiaries, controlling persons or other affiliates has had any position, office or other material relationship with the Company or the
Company’s Affiliates within the past three years, except as contemplated by this Agreement or any agreement executed simultaneously herewith. 
  
 5.15. Additional Securities Law Matters. Purchaser (a) has no present intention to engage in short sales or other hedging activity in
relation to the Company’s securities, (b) has no agreements or understandings, directly or indirectly, with any person or entity to distribute the Shares, and (c) does not share voting and/or investment control over the Company’s
securities with any person or entity (other than relationships disclosed in the Company’s most recent proxy statement filed with the SEC or in any Schedule 13D filed with the SEC by the undersigned Purchaser). 
  
 SECTION 6 
  
 Conditions to Purchaser’s Obligations to Close 
  
 The obligations of Purchaser to purchase the Shares at the Closing is subject to the fulfillment of the following
conditions, any of which may be waived by Purchaser: 
  
 6.1.
Representations and Warranties Correct. The representations and warranties made by the Company herein shall be true and correct in all material respects as of the date when made and as of the Closing. 
  
 6.2. Covenants. All covenants, agreements and conditions
contained in this Agreement to be performed by the Company on or prior to the Closing shall have been performed or complied with in all material respects. 
  
 6.3. No Injunction. No statute, rule, regulation, order, decree, ruling or injunction shall have been enacted, entered, promulgated,
endorsed or threatened or is pending by or before any Governmental Authority of competent jurisdiction which restricts, prohibits or threatens to restrict or prohibit the consummation of any of the transactions contemplated by the Agreements.

  
 6.4. No Suspensions of Trading in Common
Stock. The trading in the Common Stock shall not have been restricted or suspended by the Commission, Nasdaq or any other market or exchange where such Common Stock is traded (except for any suspension of trading of limited duration
solely to permit dissemination of material information regarding the Company). 
  
 6.5. Listing of Common Stock. As soon as possible after the Closing, and in connection with the filing of the Registration Statement, the Shares shall have been listed for trading or quotation on
Nasdaq. 

 6.6 Adverse Changes. Since the date of the financial statements included in the
Company’s Quarterly Report on Form 10-Q, Annual Report on Form 10-K, or latest Current Report on Form 8-K, whichever is more recent, last filed prior to the date of this Agreement, no event which has had or could reasonably be expected to have
a Material Adverse Effect shall have occurred. 
  
 6.7.
Litigation. Except as set forth on Schedule 6.7 to this Agreement, no Proceeding shall have been instituted or threatened against the Company which could reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect which has not been disclosed to Purchaser. 
  
 6.8. Change of Control. No Change of Control shall have occurred between the date hereof and the Closing. As used herein, “Change of Control” means the occurrence of any of (i) an acquisition after the
date hereof by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act), other than Purchaser or any of its Affiliates, of in excess of 35% of the voting securities of the Company, (ii)
a replacement of more than one-half of the members of the Company’s Board of Directors that is not approved by a majority of those individuals who are members of the Board of Directors on the date hereof, or their duly elected successors who
are directors immediately prior to such transaction, in one or a series of related transactions, (iii) the merger of the Company with or into another Person, unless following such transaction, the holders of the Company’s securities continue to
hold at least 51% of such securities following such transaction, (iv) the consolidation or sale of all or substantially all of the assets of the Company in one or a series of related transactions or (v) the execution by the Company of an agreement
to which the Company is a party or by which it is bound, providing for any of the events set forth above in clauses (i), (ii), (iii) or (iv). 
  
 6.9. Certificate of Incorporation. The Company shall have delivered to Purchaser a copy of a certificate evidencing the incorporation
and good standing of the Company, issued by the Secretary of State of the state where the Company is organized, as of a date within 10 days of the Closing. The Company shall have delivered to Purchaser, or its representatives, acting on behalf of
Purchaser, a copy of a certificate evidencing the qualification and good standing of the Company in such other states or jurisdictions where the Company’s ownership or operation of its properties or the conduct of its business require the
Company to be qualified to do business as a foreign corporation. 
  
 6.10. Compliance Certificate. Should the Closing occur as of a date other than the date of this Agreement, the Company shall have delivered to Purchaser a certificate of the Company executed by the President of the
Company, dated as of the Closing, certifying to the fulfillment of the conditions specified in Section 6 of this Agreement. 
  
 6.11. Secretary’s Certificate. The Company shall have delivered to the Purchaser a certificate of the Company executed by the
Chief Financial Officer and the Secretary of the Company, dated as of the Closing, certifying (i) resolutions adopted by the Board of Directors of the Company authorizing the execution of the Agreements, the issuance of the Shares, the filing of the
Registration Statement, and the transactions contemplated hereby; (ii) the Certificate of Incorporation and Bylaws of the Company, each as amended, and copies of the third party consents, approvals and filings required in connection with the
consummation of the transactions contemplated by the Agreements; and (iii) such other documents relating to the transactions contemplated by the Agreements as Purchaser may reasonably request. 
  
 6.12. Registration Rights Agreement. The Company and
Purchaser shall have executed, entered into and delivered the Registration Rights Agreement, in substantially the form attached hereto as Exhibit B. 
  
 6.13. Joint Development Agreement. The Company and Purchaser shall have executed, entered into and delivered a Joint Development
Agreement in form and substance acceptable to Purchaser 

 
and the Company. It is the express intention of the parties that the transactions contemplated herein are part of the strategic relationship between
Purchaser and the Company commencing pursuant to and evidenced (in part) by such Joint Development Agreement. 
  
 6.14. Other Documents. The Company shall have delivered to Purchaser such other documents relating to the transactions contemplated
by the Agreements as Purchaser or their counsel may reasonably request. 
  
 6.15. Opinion of Counsel. At the Closing, the Purchasers shall have received the opinion of Wildman, Harrold, Allen & Dixon LLP, as counsel to the Company, dated as of Closing in form and substance acceptable to the
Purchaser and counsel to the Company. 
  
 SECTION 7

  
 Conditions to Closing of the Company 
  
 The Company’s obligation to sell and issue the Shares at the Closing is,
at the option of the Company, subject to the fulfillment as of the Closing of the following conditions: 
  
 7.1. Representations. The representations and warranties made by Purchaser herein shall be true and correct in all material respects
on the dates made and on the date of Closing. 
  
 7.2.
Performance by Purchaser. Purchaser shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by the Agreements to be performed, satisfied or complied with by
Purchaser at or before the Closing. 
  
 7.3. No
Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated, endorsed or threatened or is pending by or before any Governmental Authority of competent
jurisdiction which prohibits or threatens to prohibit the consummation of any of the transactions contemplated by the Agreements. 
  
 SECTION 8 
  
 Miscellaneous 
  
 8.1. Governing Law. This Agreement shall be governed in all respects by the laws of the State of Delaware, without reference to its conflict of laws principles. 
  
 8.2. Survival. The representations, warranties,
covenants and agreements made herein shall survive any investigation made by Purchaser and the closing of the transactions contemplated hereby. 
  
 8.3. Successors and Assigns. Except as otherwise provided herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the parties hereto, provided that the rights of Purchaser to purchase the Shares shall not be assignable without the consent of the Company. 
  
 8.4. Notices, etc. All notices and other communications
required or permitted hereunder shall be in writing and shall be mailed by United States mail, postage prepaid, by reliable overnight delivery service such as UPS or FedEx, or by facsimile transmission, or otherwise delivered by hand or by

 messenger, addressed (a) if to Purchaser, at the Purchaser’s address set forth below, or at such other address as
Purchaser shall have furnished to the Company in writing, or (b) if to any other holder of any shares, at such address as such holder shall have furnished the Company in writing, or, until any such holder so furnishes an address to the Company, then
to and at the address of the last holder of such shares who has so furnished an address to the Company, or (c) if to the Company, one copy should be sent to the Company at the address listed below, in each case with a copy to Purchaser at the
address indicated below. 
  
 Company:

  
 Nanophase Technologies Corporation

 1319 Marquette Drive 
 Romeoville, Illinois 60446 
 Attention: Joseph Cross 
 Facsimile: (630) 323-1221 
  
 with a copy to: 
  
 Company Counsel: 
  
 Wildman, Harrold, Allen & Dixon LLP 
 225 West Wacker Drive 
 Suite 3000 
 Chicago, Illinois 60606-1229 
 Attention: David Weinstein 
  
 Purchaser: 
  
 Altana Chemie AG 
 Abelstrasse 45 
 46483 Wesel, Germany 
 Facsimile: +49 281 670 719 
 Attention: Mr. Martin Babilas 
  
 with a copy to: 
  
 Altana AG 
 Herbert-Quandt-Haus 
 am Pilgerrain 15 
 61352 Bad Homburg v.d. Höhe, Germany 
 Facsimile: +49 (6172) 1712 270 
 Attention: Mr. Volker Mansfeld 
  
 Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given when delivered, or if by facsimile transmission, as indicated by the facsimile imprint date. 
  
 8.5. Delays or Omissions. Except as expressly provided herein,
no delay or omission to exercise any right, power or remedy accruing to Purchaser upon any breach or default of the Company under the Agreements shall impair any such right, power or remedy of Purchaser, nor shall it be construed to be a waiver of
any such breach or default, or an acquiescence therein, or of any similar breach or default 
  

 17 

 thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or
default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of Purchaser of any breach or default under this Agreement, or any waiver on the part of any party hereto of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to Purchaser, shall be cumulative and not
alternative. 
  
 8.6. Expenses. The Company and
Purchaser shall each bear their own legal and other expenses with respect to this Agreement. 
  
 8.7 Counterparts. This Agreement may be executed in two or more identical counterparts and by facsimile, each of which shall be deemed an original and all of which shall constitute one and the same
agreement. Any signature that is delivered by facsimile transmission shall be valid and binding, with the same force and effect as if an original, manually signed counterpart. 
  
 8.8. Severability. In the event that any provision of this Agreement is unenforceable, the remaining
provisions shall continue in full force and effect. 
  
 8.9.
Section Headings, etc. The titles and subtitles used in this Agreement are used for convenience only and are not considered in construing or interpreting this Agreement. As used herein, any gender shall include all other genders, and the
singular shall include the plural and vice versa. The terms “include,” “including” and similar terms shall mean include without limitation, whether by enumeration or otherwise. 
  
 8.10. No Third-Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors and assigns, and no other person is intended to or shall have any rights hereunder whether as a third party beneficiary or otherwise. 
  
 8.11. Further Assurances. Each party shall do and perform, or
cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other parties may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 
  
 8.12. Confidentiality. All material, non-public information disclosed by the Company to Purchaser pursuant to this Agreement or otherwise
shall be held strictly confidential and used by Purchaser solely for evaluating purchases of Shares in this Offering, provided this obligation shall not apply to any information that is generally available to the public or becomes available
to the public without any disclosure by Purchaser. The provisions of this Section 8.12 shall not in any way amend or supercede the provisions of any other confidentiality, non-disclosure or similar agreement with the Company to which Purchaser is
bound. 
  
 8.13. Entire Agreement; Amendment. This
Agreement and the Registration Rights Agreement and the other documents contemplated therein constitute the entire understanding and agreement between Purchaser and the Company with regard to the subject matter. Except as expressly provided herein,
this Agreement, any of the other Agreements or any term hereof may be amended, modified, waived or discharged only by a written instrument signed by the party waiving any term, condition, or right or remedy that benefits it hereunder. 
  
 8.14. Public Statements or Releases. Neither the Company nor
any Purchaser shall make any public announcement with respect to the existence or terms of this Agreement or the transactions 
  

 18 

 provided for herein without the prior approval of the other parties, which shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, nothing in this Section 8.14 shall prevent any party from making any public announcement it considers necessary in order to satisfy its obligations under the law or the rules of any national securities exchange or
Nasdaq; provided such party, to the extent practicable, provides the other parties with an opportunity to review and comment on any proposed public announcement before it is made. 
  
  
 [Signature Pages to Follow] 

 IN WITNESS WHEREOF, the undersigned have executed this Stock Purchase Agreement as of the day and
year first set forth above. 
  
  

			
	 Altana Chemie AG
 a German corporation

		
	By:	 	 /s/    Matthias L. Wolfgruber        

	 	 	

	 	 	 Dr. Matthias L. Wolfgruber,
 President & CEO

		
	By:	 	 /s/    Martin Babilas         

	 	 	

	 	 	 Martin Babilas,
 Vice President Strategic Business Development

	
	 Nanophase Technologies Corporation

		
	By:	 	 /s/    Joseph Cross        

	 	 	

	 	 	 Joseph Cross, CEORegistration Rights Agreement dated March 23, 2004

 Exhibit 4.11 
  
 REGISTRATION RIGHTS AGREEMENT 
  

THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into as of March 23, 2004, by and between NANOPHASE
TECHNOLOGIES CORPORATION, a Delaware corporation located at 1319 Marquette Drive, Romeoville, Illinois (the “Company”), and Altana Chemie AG, a German corporation (the “Purchaser”). 
  
 This Agreement is made pursuant to the Stock Purchase Agreement, dated on or
about the date hereof (the “Stock Purchase Agreement”), by and between the Company and Purchaser, pursuant to which the Company is issuing and selling up to 1,256,281 shares of its common stock, US$.01 par value per share (the
“Common Stock” or the “Shares”) to Purchaser. 
  
 The Shares are being offered and sold to Purchaser without registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemption from registration provided
by Section 4(2) of the Securities Act and the provisions of Rule 506 of Regulation D, promulgated under the Securities Act. In order to induce Purchaser to enter into the Stock Purchase Agreement, the Company has agreed to provide to Purchaser (and
their direct and indirect permitted transferees, if any) the registration rights set forth in this Agreement with respect to the resale of the Shares. The execution and delivery of this Agreement is a condition to the Closing under the Stock
Purchase Agreement. Capitalized terms used but not defined herein shall have the meaning provided in the Stock Purchase Agreement. 
  
 In consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties, intending to be legally bound, agree as follows: 
  
 SECTION 1 
  
 Registration Rights

  
 1.1. Filing of Form S-3 Resale Registration
Statement. As soon as practicable following the second anniversary of the date hereof, the Company shall file with the Securities and Exchange Commission (the “SEC” or the “Commission”) a registration
statement on Form S-3 pursuant to Rule 415 under the Securities Act, or, in the event that Form S-3 is unavailable to the Company, a registration statement on such other SEC Form that is available to the Company (together with any exhibits,
amendments or supplements thereto, and any documents incorporated by reference therein, the “Registration Statement”), with respect to the resale of the Shares, and any securities of the Company issued as a dividend or other
distribution with respect to, or in exchange for or in replacement of, the Shares. The securities described in the preceding sentence are collectively referred to herein as the “Registrable Securities;” provided, that the
term “Registrable Securities” shall not include securities transferred to a person other than a permitted transferee. 
  
 1.2. Effectiveness of Registration Statement. The Company shall, subject to Section 6 hereof, use its best efforts to cause the Registration
Statement to become effective as soon as practicable and in no event later than three (3) months after the date of filing of the Registration Statement, and shall use its commercially reasonable best efforts to keep the Registration Statement
continuously effective from the date such Registration Statement becomes effective until the earlier of (i) the date on which all Shares have been resold under such Registration Statement and (ii) the date on which all Registrable Securities

 may be resold without restriction or limitation. The obligations under this Section will not apply to any delay or
complication caused in whole or in part by Purchaser. 
  
 1.3.
Supplements; Amendments. Subject to Section 6 hereof, the Company shall supplement or amend the Registration Statement, (i) as required by Form S-3, including, without limitation, the instructions applicable to Form S-3, or by the
Securities Act, the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or the rules and regulations promulgated under the Securities Act or the Exchange Act, respectively, and (ii) to include in the Registration
Statement any additional securities that become Registrable Securities by operation of the definition thereof. The Company shall furnish to the holders of the Registrable Securities, or their permitted transferees, as appropriate (collectively, the
“Holders”), to which the Registration Statement relates copies of any such supplement or amendment sufficiently in advance (but in no event less than five (5) business days in advance) of its use and/or filing with the Commission to
allow the Holders a meaningful opportunity to comment thereon with respect to the information contained therein regarding the Holders and any plan for resale of the Registrable Securities. The Holders acknowledge or shall acknowledge that they have
supplied the information regarding themselves and their plan of resale in the Registration Statement within five (5) business days prior to the filing of the Registration Statement and hereby waive or shall waive any notice of the initial filing of
the Registration Statement, and such Holders and their successors and assigns shall promptly notify the Company of any changes in such information. 
  
 SECTION 2 
  
 Expenses 
  
 The Company shall pay all expenses, fees and costs incurred in connection with the preparation, filing, distribution and effectiveness of the Registration Statement and any supplements or amendments thereto, whether or not the Registration
Statement becomes effective, and whether all, none or some of the Registrable Securities are sold pursuant to the Registration Statement, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, fees and state securities, or “blue sky,” fees and expenses, and the expense of any special audits incident to or required by, or in connection with the filing and effectiveness of the Registration Statement. The
Holders shall pay all underwriting fees and discounts, selling commissions, brokerage fees and stock transfer taxes applicable to the Registrable Securities sold by such Holder and the fees and expenses of their counsel, if any. 
  
 SECTION 3 
  
 Registration Procedures 
  
 3.1. Registration. The Company will advise the Holders as to the status of the preparation, filing and effectiveness of the Registration
Statement and, at the Company’s expense, will do the following: 
  
 (a) furnish to each Holder a copy of the Registration Statement (including all exhibits thereto) and any prospectus forming a part thereof and any amendments and supplements thereto (including all documents
incorporated or deemed incorporated by reference therein prior to the effectiveness of the Registration Statement and including each preliminary prospectus) and any other prospectus filed under Rule 424 under the Securities Act, which documents,
other than documents incorporated or deemed incorporated by reference, will be subject to the review of the Holders and any such underwriter for a period of at least three (3) business days, and the Company shall not file the Registration Statement
or such prospectus or any amendment or 

 supplement to the Registration Statement or prospectus if any Holder shall reasonably object within three
(3) business days after the receipt thereof. A Holder shall be deemed to have reasonably objected to such filing only if the Registration Statement, amendment, prospectus or supplement, as applicable, as proposed to be filed, contains a material
misstatement or omission with respect to such Holder or its plan of resale; 
  
 (b) furnish to each Holder one conformed copy of the Registration Statement and of each amendment and supplement thereto (in each case including all exhibits) and such number of copies of the prospectus forming a part
of the Registration Statement (including each preliminary prospectus) and any other prospectus filed under Rule 424 under the Securities Act, in conformity with the requirements of the Securities Act, and such other documents, including, without
limitation, documents incorporated or deemed to be incorporated by reference prior to the effectiveness of such Registration Statement, as each of the Holders or any such underwriter, from time to time may reasonably request; 
  
 (c) to the extent practicable, promptly upon the filing of
any document that is to be incorporated by reference into the Registration Statement or prospectus forming a part thereof subsequent to the effectiveness thereof, and in any event no later than five (5) business days after such document is filed
with the Commission, provide copies of such document to the Holders, if requested, and make representatives of the Company available for discussion of such document and other customary due diligence matters; and provide promptly to the Holders upon
request any document filed by the Company with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act; 
  
 (d) make available at reasonable times for inspection by the Holders, and any attorney, accountant, financial adviser or other
representative (collectively, “Representatives”) retained by the Holders, subject to the recipient’s prior written agreement to keep such information confidential and not use or disclose it, all financial and other records,
pertinent corporate documents and properties of the Company and cause the officers, directors and employees of the Company to supply all information reasonably requested by the Holders or their respective Representatives in connection with the
preparation, filing and effectiveness of the Registration Statement; 
  
 (e) use its commercially reasonable best efforts (i) to register or qualify all Registrable Securities covered by the Registration Statement under state securities, or “blue sky,” laws of such States of the
United States of America where required and where an exemption is not available and as the Holders of Registrable Securities covered by the Registration Statement shall reasonably request, (ii) to keep such registration or qualification in effect
for so long as the Registration Statement is required to be effective hereunder, and (iii) to take any other action which may be reasonably necessary or advisable to enable the Holders to consummate the disposition of the securities to be sold by
the Holders in such jurisdictions, consistent with the plan of distribution described in the prospectus included in the Registration Statement, except that the Company shall not for any such purpose be required to qualify generally to do business as
a foreign corporation in any jurisdiction where it is not so qualified, or to execute a general consent to service of process in effecting such registration, qualification or compliance, unless the Company is already subject to service in such
jurisdiction and except as may be required by the Securities Act or applicable rules or regulations thereunder; 
  
 (f) use its commercially reasonable best efforts to cause all Registrable Securities covered by the Registration Statement to be
registered or qualified with or approved by all other applicable Governmental Authorities as may be necessary, in the opinion of counsel to the 

 Company and counsel to the Holders of Registrable Securities, to enable the Holders thereof the
consummate the disposition of such Registrable Securities; 
  
 (g) subject to Section 6 hereof, promptly notify each Holder of Registrable Securities covered by the Registration Statement (i) upon discovery that, or upon the occurrence of any event as a result of which, the
prospectus forming a part of the Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the initiation of proceedings for that purpose, (iii) of any
request by the Commission for (A) amendments to the Registration Statement or any document incorporated or deemed to be incorporated by reference in the Registration Statement, or (B) supplements to the prospectus forming a part of the Registration
Statement, or (C) additional information, or (iv) of the receipt by the Company of any notification with respect to the suspension of the registration, qualification or exemption from registration or qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation of any proceeding for such purpose, and at the request of any such Holder promptly prepare and file an amendment to the Registration Statement or a supplement to the prospectus as the Company
may deem necessary so that, as thereafter delivered to the purchasers of such securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were made, not misleading; and furnish to each Holder a reasonable number of copies of such supplement to, or amendment of, such registration statement and prospectus, and,
in the event of a stop order, use its commercially reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of any the Registration Statement, or the lifting of any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any jurisdiction; 
  
 (h) if reasonably requested by any Holder or if required by law or SEC or other applicable rule or regulation, promptly incorporate in the
Registration Statement such appropriate information as the Holder may reasonably request to have included therein by filing a Form 8-K, or filing a supplement to the prospectus, to reflect any change in the information regarding the Holder, and make
all required filings with the Commission in respect of any offer or sale of Registrable Securities or any amendment or supplement to the Registration Statement or related prospectus; 
  
 (i) otherwise use its commercially reasonable best efforts to comply with all applicable rules and
regulations, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least 12 months, but not more than 18 months, beginning with the first full calendar month after the
effective date of the Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder and to provide promptly to the Holders upon request any document filed by
the Company with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act; and 
  
 (j) use its commercially reasonable best efforts to cause all Registrable Securities included in the Registration Statement to be listed
on Nasdaq and each securities exchange on which securities of the same class are then listed, or, if not then listed on any securities exchange or Nasdaq, to be eligible for trading in any over-the-counter market or trading system in which
securities of the same class are then traded. 

 SECTION 4 
  

Indemnification 
  
 4.1. Indemnification by the Company. The Company will indemnify: 
  
 (a) each of the Holders, as applicable, 
  
 (b) each of the Holder’s officers, directors, members and partners, and 
  
 (c) each individual, partnership, joint stock company,
corporation, trust, unincorporated organization, government agency or political subdivision (each of the foregoing, a “Person”) controlling each of the Holders within the meaning of SEC Rule 405 under the Securities Act, 

 
 with respect to the Registration Statement, against all expenses, claims, losses, damages
and liabilities (or actions, investigations or proceedings in respect thereof) (collectively, a “Claim”) arising out of or based on any actual or alleged untrue statement of a material fact, or any omission of a material fact
required to be stated therein or necessary in order to make the statements included therein not misleading, contained in the Registration Statement, any prospectus or other offering document (including any related registration statement,
notification or the like) incident to the registration, qualification or compliance, or any violation by the Company of the Securities Act or the Exchange Act or any other laws or any rule or regulation thereunder applicable to the Company and
relating to action or inaction required of the Company in connection with any such registration, qualification or compliance, and will reimburse each of the Holders, each of its officers, directors, members and partners, and each Person controlling
each of the Holders, for any legal and any other expenses reasonably incurred in connection with investigating and defending any such Claim; provided, however, that the Company will not be liable in any such case to the extent that any such
Claim (i) arises out of or is based on any untrue statement or omission based upon written information furnished to the Company by the Holders or their Representatives and stated to be specifically for use therein, or (ii) is finally judicially
determined to have resulted primarily from the gross negligence or willful misconduct of any person or entity set forth in subsections (a) through (c) above. 
  
 4.2. Indemnification by the Holders. Each of the Holders will, if Registrable Securities held by it are included in the securities as to
which such Registration Statement is being effected, indemnify the Company, each of its directors and officers, and each Person who “controls” the Company within the meaning of SEC Rule 405 under the Securities Act, against all Claims
arising out of or based on any actual or alleged untrue statement of a material fact, or any omission or a material fact required to be stated therein or necessary in order to make the statement included or incorporated therein not misleading,
contained in the Registration Statement, prospectus, or other offering document made by or on behalf of such Holder, and will reimburse the Company, its directors, officers, partners, members or control Persons for any legal or any other expenses
reasonably incurred in connection with investigating and defending any such Claim, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in the
Registration Statement, prospectus or other document in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Holder and stated to be specifically for use therein; provided, however, that
the obligations of each of the Holders hereunder shall be limited to an amount equal to the net proceeds received by such Holder from the sale of the Registrable Securities pursuant to the Registration Statement. 

 4.3. Procedures. Each party entitled to indemnification under this Agreement (each, an
“Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any Claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any such Claim; provided that counsel for the Indemnifying Party, who shall conduct the defense of such Claim, shall be approved by the Indemnified Party (whose
approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such party’s expense (unless the Indemnified Party shall have reasonably concluded that there may be a conflict of interest between the
Indemnifying Party and the Indemnified Party in such action, in which case the fees and expenses of one such counsel for all Indemnified Parties shall be at the expense of the Indemnifying Party), and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Agreement unless the Indemnifying Party is materially prejudiced thereby. No Indemnifying Party, in the investigation or
defense of any such Claim shall, except with the consent of each Indemnified Party (which consent shall not be unreasonably withheld or delayed), consent to entry of any judgment or enter into any settlement or compromise which does not include an
unconditional release of the Indemnified Party from all liability in respect to such Claim. Each Indemnified Party shall furnish such information regarding itself or the Claim in question as an Indemnifying Party may reasonably request in writing
and as shall be reasonably required in connection with the investigation and defense of such Claim. 
  
 4.4. Contribution. If the indemnification provided for in this Agreement is held by a court of competent jurisdiction to be unavailable to
an Indemnified Party with respect to any Claim, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability,
claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions which resulted in such
Claim, as well as any other relevant equitable considerations; provided, however, that the Company will not be liable in any such case to the extent that any such Claim (i) arises out of or is based on any untrue statement or omission based
upon written information furnished to the Company by the Holders or their Representatives and stated to be specifically for use therein, or (ii) is finally judicially determined to have resulted primarily from the gross negligence or willful
misconduct of any person or entity set forth in Section 4.1(a) through 4.1(c) above. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue (or alleged
untrue) statement of a material fact or the omission (or alleged omission) to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission, and provided that each Holder shall not be required to contribute, in the aggregate, more than the net proceeds received by the Holders from the sale of the Registrable
Securities pursuant to the Registration Statement. 
  
 SECTION 5

  
 Provision of Information by the Holders 

 
 Each of the Holders whose Registrable Securities are included in the
Registration Statement shall furnish to the Company such information regarding such Holder as the Company may reasonably request in writing and as shall be reasonably required or advisable in connection with any registration, qualification or
compliance referred to in this Agreement, and shall promptly notify the Company if such information becomes incorrect or misleading, or requires amendment or updating. Each of the Holders agrees that the plan of distribution included in any
prospectus relating to the Registrable Securities shall 

 be as set forth on Schedule A-1 hereto and that such Holder will not resell any Registrable Securities pursuant to
the Registration Statement in any manner other than as provided therein or herein. The other information regarding the Holders required for the initial filing of the Registration Statement has been or will be provided by each Holder. Each Holder
represents, warrants and covenants to the Company that the information regarding such Holder that appears in the Stock Purchase Agreement and/or Schedule A-2 is accurate and complete in all material respects consistent with Commission Regulation
S-K, Items 507 and 508. The Purchaser will confirm promptly by delivery of a signed copy of Schedule A-2, the sale of any Shares pursuant to Rule 144 or the Registration Statement. 
  
 SECTION 6 
  
 Holdback; Postponement 
  
 Notwithstanding the other provisions of this Agreement, if (a) there is material non-public information regarding the Company which the Company’s
Board of Directors reasonably and in good faith determines not to be in the Company’s best interest to disclose and which the Company is not otherwise required to disclose, or (b) there is a extraordinary business opportunity (including but not
limited to the acquisition or disposition of assets (other than in the ordinary course of business) or any merger, consolidation, tender offer or other similar extraordinary transaction not in the ordinary course of business) available to the
Company which the Company’s Board of Directors reasonably and in good faith determines not to be in the Company’s best interest to disclose, then the Company may (upon not less than two trading days prior written notice by same day
delivery of fax or hand delivery) postpone or suspend filing or effectiveness of a registration statement for a period not to exceed 45 days, provided that the Company may not postpone or suspend filing or effectiveness of a registration
statement for more than 90 days in the aggregate during any 365-day period and there shall be an aggregate of not more than two (2) suspensions during any 365-day period; provided, however that no postponement or suspension shall be permitted
for consecutive 45 day periods arising out of the same set of facts, circumstances or transactions. 
  
 SECTION 7 
  
 Rule 144 Reporting, Etc. 
  
 7.1. SEC
Reporting Compliance. 
  
 (a) With a view to making
available the benefits of certain rules and regulations of the Commission which may at any time permit the sale of the Registrable Securities to the public without registration, through the second anniversary of this Agreement, the Company will:

  
 (i) make and keep “current public
information” regarding the Company available, as defined in Commission Rule 144(c) under the Securities Act; 
  
 (ii) use its commercially reasonable best efforts to file with the Commission in a timely manner all SEC Reports and other filings and
documents required of the Company under the Securities Act and the Exchange Act and otherwise; and 
  
 (iii) so long as a Holder owns any Registrable Securities, furnish the Holder forthwith upon request a written statement by the Company as
to its compliance with the reporting requirements under the Securities Act and the Exchange Act, including compliance with SEC Rule 144(c), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents of
the Company and other information in the possession of, or 

 
reasonably obtainable by, the Company as a Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing a Holder to
sell any such securities without registration. 
  
 (b) The Company
shall file the reports required to be filed by it under the Exchange Act and shall comply with all other requirements set forth in the instruction to Form S-3 in order to allow the Company to be eligible to file registration statements on Form S-3.

  
 7.2. Stock Purchase Agreement Covenants. The
Company will comply with its covenants under Section 4 of the Stock Purchase Agreement, which are incorporated herein by this reference. 
  
 SECTION 8 
  
 Miscellaneous 
  
 8.1. Assignment. The registration rights set forth herein may be assigned, in whole or in part, to any transferee of Registrable Securities permitted in accordance with the Stock Purchase Agreement,
which transferee, upon registration on the Company’s or its transfer agent’s books and records as a holder of record of Registrable Securities, shall be considered thereafter to be a Holder (provided that any transferee who is not an
affiliate of Purchaser shall be a Holder only with respect to such Registrable Securities so acquired and any stock of the Company issued as a dividend or other distribution with respect to, or in exchange for or in replacement of, such Registrable
Securities) and shall be bound by all obligations and limitations of this Agreement and the Stock Purchase Agreement. 
  
 8.2. Section Headings. The titles and headings of the sections and subsections of this Agreement are inserted for convenience only and shall
not be deemed to constitute a part thereof. 
  
 8.3.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. 
  
 8.4. Notices. 
  
 (a) All communications under this Agreement shall be in writing and shall be delivered by facsimile, by hand, by reliable overnight
delivery service such as UPS or FedEx or by registered or certified mail, postage prepaid: 
  
 (i) if to the Company, to Nanophase Technologies Corporation, 1319 Marquette Drive, Romeoville, Illinois 60446, Facsimile: (630) 771-0825,
Attention: Joseph Cross, or at such other address as it may have furnished in writing to Purchaser; 
  
 (ii) if to Purchaser, at the addresses listed on Schedule 1 hereto, or at such other addresses as may have been furnished the Company in
writing. 
  
 (b) Any notice so addressed shall be
deemed to be given (i) if delivered by hand, on the date of such delivery, (ii) if sent by reliable overnight delivery service such as UPS or FedEx, on the first business day following the date of delivery to such service for overnight delivery,
(iii) if delivered by facsimile, on the date of such facsimile, or (iv) if mailed by registered or certified mail, on the third business day after the date of such mailing. 
  
 8.5. Successors and Assigns; No Third Party Beneficiaries. This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of each of the parties. No other 

 
person is intended to or shall have any rights or remedies hereunder, whether as a third part beneficiary or otherwise. 
  
 8.6. Counterparts. This Agreement may be executed in one or
more identical counterparts, each of which shall be deemed an original and all of which shall be one and the same agreement. Any signature that is delivered by facsimile signature page shall be valid and binding, with the same force and effect as if
an original, manually signed counterpart. 
  
 8.7.
Remedies. Each Holder of Registrable Securities, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. The Company
agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agrees to waive the defense in any action for specific performance that a remedy at law
would be adequate. 
  
 8.8. Severability. In the
event that any provision contained herein is unenforceable, the remaining provisions shall continue in full force and effect. 
  
 8.9. Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to the Holders, upon any
breach or default of the Company under this Agreement, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any provision hereof, or of any similar breach or default thereafter occurring; nor shall any wavier of
any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character by a Holder of any breach or default under
this Agreement, or any waiver by a Holder of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in the writing, and that all remedies, either under this Agreement, or
by law or otherwise afforded to a Holder, shall be cumulative and not alternative. 
  
 8.10. Attorney’s Fees. If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorney’s fees,
costs and necessary disbursements in addition to any other relief to which such party may be entitled. 
  
 8.11. Entire Agreement; Amendment. This Agreement and the Stock Purchase Agreement and the other documents contemplated therein constitute
the entire understanding and agreement of the parties with respect to the subject matter hereof and supersede all prior understandings, written or otherwise, among such parties. This Agreement may be amended only in a writing signed by the Company
and the Holders of a majority of the then outstanding Registrable Securities. 
  
  
 [Signature Pages to Follow] 

 IN WITNESS WHEREOF, the undersigned have executed this Registration Rights Agreement as of the day
and year first set forth above. 
  
  
  
  

			
	 Altana Chemie AG
 a German
corporation
  

		
	By:	 	 /s/    Matthias L. Wolfgruber

	 	 	

	 	 	 Matthias L. Wolfgruber
 President & CEO

		
	By:	 	 /s/    Martin Babilas

	 	 	

	 	 	 Martin Babilas
 Vice President Strategic Business Development

	  
  
  
  
 Nanophase Technologies Corporation
  

		
	By:	 	 /s/    Joseph Cross

	 	 	

	 	 	 Joseph Cross, CEO

 SCHEDULE A-1 
  
 Plan of Distribution 
  
 Any or all of the shares offered by the selling stockholders may be offered for sale and sold by, or on behalf of, the selling stockholders from time to
time in varying amounts, including in block transactions, on the Nasdaq Stock Market, or the over-the-counter market, in privately negotiated transactions, though put or call options transactions relating to the shares, through short sales, or a
combination of such methods of sale, at prices prevailing in such market or as may be negotiated at the time of the sale. The shares may be sold by the selling stockholders directly to one or more purchasers, through agents designated from time to
time or to or through broker-dealers designated from time to time. In the event the shares are publicly offered through broker-dealers or agents, the selling stockholders may enter into agreements with respect thereto. Such broker-dealers or agents
may receive compensation in the form of discounts, concessions or commissions from the selling stockholders, and any such broker-dealers or agents that participate in the distribution of the shares may be deemed to be underwriters within the meaning
of the Securities Act, and any profit on the sale of the shares by them and any discounts and commissions might be deemed to be underwriting discounts or commissions under the Securities Act. Any such broker-dealers and agents may engage in
transactions with, and perform services for, the Company. At the time a particular offer of shares is made by the selling stockholders, to the extent required, a prospectus supplement will be distributed which will set forth the aggregate number of
shares being offered, and the terms of the offering, including the public offering price thereof, the name or names of any broker-dealers or agents, any discounts, commissions and other items constituting compensation from, and the resulting net
proceeds to, the selling stockholders. 
  
 As used herein,
“selling stockholders” includes donees and pledgees selling shares received from a named selling shareholder after the date of this prospectus. 
  
 Selling stockholders also may resell all or a portion of the shares in open market transactions in reliance on Rule 144 under the Securities Act, provided
they meet the criteria and conform to the requirements of such rule. 
  
 In order to comply with the securities laws of certain states, sales of shares offered hereby to the public in such states may be made only through broker-dealers who are registered or licensed in such states. Sales of shares offered hereby
must also be made by the selling stockholders in compliance with other applicable state securities laws and regulations. 

  
 IN WITNESS WHEREOF,
the undersigned have executed this Registration Rights Agreement as of the day and year first set forth above. 
  
  
  
  

			
	 Altana Chemie AG
 a German
corporation
  

		
	By:	 	 /s/    Gerd Büscher

	 	 	

	 	 	 Gerd Büscher
 Chief Financial Officer

		
	By:	 	 /s/    Martin Babilas

	 	 	

	 	 	 Martin Babilas
 Vice President Strategic Business Development

	  
  
  
  
 Nanophase Technologies Corporation
  

		
	By:	 	 /s/    Joseph Cross

	 	 	

	 	 	 Joseph Cross, CEO

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