Document:

altair_8k-ex1003.htm

    
      

    

     

    Exhibit
      10.3

     

    
 

    
      

      

      [JP
        Morgan Dealer Letterhead]

      

      April
        21,
        2006

      

      

      STRICTLY
        CONFIDENTIAL

      

      Altair
        Nanotechnologies Inc.

      204
        Edison Way

      Reno,
        Nevada 89502-2306

      

      
        	
                Attention:

              	
                Alan
                  J. Gotcher, Chief Executive Officer,

                
                  Ed
                    Dickinson, Chief Financial Officer, and

                  C.
                    Robert Pedraza, Vice President, Strategy & Business
                    Development

                

              

      

       

      Ladies
        and Gentlemen:

      

      Pursuant
        to our recent discussions, we are pleased to confirm the arrangements under
        which J.P. Morgan Securities Inc. (“JPMorgan") is
        exclusively engaged by Altair Nanotechnologies Inc., a Canadian corporation
        (collectively with its subsidiaries and affiliates, the ”Company”) to act as its
        financial advisor in connection with the Company's strategic
        planning.

      

      Section
        1.  Financial
        Advisory Services.  During the term of this agreement we
        will:

      

      (a)
        familiarize ourselves with the
        financial condition and business of the Company and review the Company's
        structural defenses, including its charter and by-law provisions;

      

      (b)
        provide advice concerning amendments to the Company’s shareholder rights plan
        (the “Rights Plan”), including the appropriate exercise price for the Rights
        Plan;

      

      (c)
        periodically update the Company’s
        senior management and Board of Directors regarding prevailing market conditions
        for mergers and acquisitions, with a particular focus on hostile activity
        and
        shareholder responses to various defensive strategies;

      

      (d)
        prepare a financial analysis of the Company and consider the appropriateness
        of
        various strategic and financial alternatives;

      

      (e)
        assist the Company in organizing a defense team of executive, financial,
        legal
        and other key personnel who would respond to any unsolicited offer for the
        Company;

      

      (f)
        analyze the composition of the Company’s shareholder base and monitor any
        significant changes in such base;  and

      

      (g)
        evaluate on a preliminary basis any
        proposal the Company may receive to sell or merge the Company or any of its
        businesses, or to enter into any other form of business
        combination.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          Altair
            Nanotechnologies Inc.

          April
            __, 2006

        

      

       

       

      The
        Company and JPMorgan agree that the Standard Terms and Conditions attached
        hereto form an integral part of this agreement and are hereby incorporated
        herein by reference in their entirety.

      

      Section
        2.  Other
        Assignments.  As compensation for JPMorgan providing the services
        provided for above, that Company agrees that if, within two years of the
        date
        hereof, the Company receives any proposal or offer (collectively, a “Proposal”)
        to sell or merge the Company or any of its businesses, or to enter into any
        other form of business combination involving a majority of its capital stock
        or
        all or substantially all of its assets or operations (a
“Transaction”),  the Company shall offer JPMorgan the right to act as
        its exclusive financial advisor with respect to any such Proposal and as
        exclusive financial advisor or dealer manager, as applicable, with respect
        to a
        Transaction or any other transactions that may result from the Company’s
        receiving such Proposal (including (i) any merger, sale, acquisition,
        divestiture, joint venture or other business combination, any repurchase
        by the
        Company of a significant amount of its securities (but excluding any license
        of
        the Company’s technology unless such license applies to all or substantially all
        of the technology of the Company), or (ii) any recapitalization of the Company,
        or any spin-off, split-off or other extraordinary dividend of cash, securities
        or other assets of the Company to shareholders of the Company (an “Alternative
        Transaction”)).

      

      In
        addition, in the event the Company,
        within two years of the date hereof, determines to issue any equity or debt
        securities through a public or Rule 144A offering or a private placement,
        enter
        into a syndicated credit facility, any interest rate hedging, foreign exchange
        hedging or equity derivative transaction or any escrow arrangement, or pursue
        any restructuring of debt securities of the Company (by consent, tender offer
        or
        otherwise), and in any such case determines to engage a financial advisor,
        investment bank, placement agent or similar advisor in connection with such
        transaction, the Company shall offer JPMorgan the right to act as lead manager
        and sole bookrunner in the case of any such offering, as exclusive placement
        agent in the case of any such placement, as lead arranger and sole bookrunner
        in
        the case of any such credit facility, as exclusive structuring advisor and
        arranger in the case of any such hedging or derivative transaction, as escrow
        agent in the case of any such escrow arrangement and as exclusive financial
        advisor or dealer-manager in the case of any such restructuring of debt
        securities.

      

      If
        JPMorgan agrees to act in any
        capacity referred to above, the Company and JPMorgan will enter into the
        appropriate form of agreement relating to the type of transaction involved
        and
        containing customary terms and conditions acceptable to the Company and
        JPMorgan, including provisions relating to the scope of JPMorgan’s services,
        JPMorgan’s compensation and an indemnification of JPMorgan.  However,
        unless specifically covered by a separate agreement setting forth such
        arrangement, the provisions of Section 1 of the Standard Terms and Conditions
        shall apply to each such transaction.  The Company acknowledges that
        the foregoing is neither an express nor implied commitment by JPMorgan to
        act in
        any such capacity or to purchase or place securities, or to provide or be
        responsible to provide any financing or other financial services, which
        commitment shall only be set forth in a separate written agreement in customary
        form for the type of services being provided.

      

      Section
        3.  Expenses and
        Payments. In addition to our fees for professional services, you agree to
        reimburse us for, and we will separately bill, our reasonable expenses as
        incurred, including travel costs, document production and other similar
        expenses, and reasonable fees of counsel and other professional advisors;
        provided, however, the Company shall not be required to reimburse JP Morgan
        for
        more than $30,000 in fees and expenses of any kind in the aggregate without
        its
        prior written consent, not to be unreasonably withheld (and except as otherwise
        provided in Section 1 of the attached Standard Terms and
        Conditions  or any separate written agreement between the Company and
        JPMorgan). All amounts payable under this agreement (including the Standard
        Terms and Conditions) shall be paid in immediately available funds in U.S.
        dollars, without setoff and without deduction for any withholding, value-added
        or other similar taxes, charges, fees or assessments.

       

      
         

        
          
            
            

          

          
            2

            
              

            

          

          
            
            

            Altair
              Nanotechnologies Inc.

            April
              __, 2006

          

        

         

         

         

      

      Section
        4.  Term. This agreement will be effective as of April 4,
        2006 and will expire on the date two years from the
        date hereof.  Our services hereunder may be earlier terminated with or
        without cause by you or by us at any time, in any case without liability
        or
        continuing obligation to you or to us; provided that the provisions of Section
        2
        hereof shall survive any termination by the Company or expiration of this
        agreement, and the provisions of Section 3 hereof (with respect to expenses
        incurred by us to the date of termination and the last sentence of such Section
        3) and Sections 1, 2 and 4 of the Standard Terms and Conditions shall survive
        any termination or expiration of this agreement.

      

      Section
        5.  Compliance
        With Law.  JP Morgan represents that it has all licenses, permits
        and qualifications required in order to provide its services under this
        Agreement and agrees to provide such services in compliance with all applicable
        laws and regulations.

      

      If
        the terms of our engagement as set
        forth in this agreement (including the attached Standard Terms and Conditions)
        are satisfactory, kindly sign the enclosed copy of this letter and return
        it to
        the undersigned.  We look forward to working with the Company on this
        assignment.

      

      
        
          	 	
                  Very
                    truly yours,

                  

                  J.P.
                    MORGAN SECURITIES INC.

                  

                  By:  /s/                                                              

                           Name:

                           Title:    Managing
                    Director

                

        

      

       

       

      Accepted
        and Agreed As Of

      The
        Date
        First Written Above:

      

      Altair
        Nanotechnologies Inc.

      

      By:
        /s/                                                      

          Name:

          Title:

      

      Enclosure

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

          Altair
            Nanotechnologies Inc.

          April
            __, 2006

        

      

       

       

      

      STANDARD
        TERMS AND CONDITIONS

      

      

      The
        following general terms and conditions shall be incorporated by reference
        into
        the engagement letter dated April 21, 2006 between Altair Nanotechnologies
        Inc. and JPMorgan to which these terms are attached (the
“Engagement Letter”).  Capitalized terms used below without definition
        shall have the meanings assigned to them in the Engagement Letter and any
        references herein to the “Agreement” shall mean the Engagement Letter together
        with these Standard Terms and Conditions.

      

      Section
        1. Indemnification and
        Contribution.

      

      (a) The
        Company
        agrees (i) to indemnify and hold harmless JPMorgan and its affili­ates, and
        the respective direc­tors, officers, agents, and employees of JPMorgan and
        its affiliates (JPMorgan and each such entity or person being referred to
        as an
“Indemnified Person”), from and against any losses, claims, demands, damages or
        liabilities of any kind (collectively, “Liabilities”) relating to or arising out
        of activities per­formed or services furnished pursu­ant to the
        Agreement, any transac­tion or JPMorgan's role in connection there­with,
        and (ii) to reimburse each Indemni­fied Person for all reasonable expenses
        (including reasonable fees and disbursements of coun­sel) incurred by such
        Indemni­fied Person in connection with investigat­ing, preparing or
        defending any investigative, administrative, judicial or regulatory action
        or
        proceeding in any jurisdiction related to or arising out of such activities,
        services, transaction or role, whether or not in connection with pending
        or
        threatened litigation to which any Indemnified Person is a party, in each
        case
        as such expenses are incurred or paid.  The Company will not, however,
        be responsible for any such Liabilities or expens­es to the extent that they
        are finally judicially determined to have result­ed primarily from an
        Indemnified Person’s bad faith, gross negligence or willful
        misconduct.  The Company also agrees that no Indemnified Person shall
        have any liability (whether direct or indirect, in contract, tort or otherwise)
        to the Company or any of its securityholders or creditors for or in connection
        with the Agreement, any transaction or JPMorgan's role or services in
        connec­tion there­with, except to the extent that any such
        Liabil­ities or expens­es incurred by the Company are finally judicially
        deter­mined to have resulted primarily from an Indemnified Person's bad
        faith, gross negligence or willful misconduct. In no event shall any Indemnified
        Person be responsible for any special, indirect or consequential
        damages.

      

      (b)  The
        Company shall not be
        liable for any settlement of any litigation or proceeding ef­fected without
        its written consent.  The Company will not, without JPMorgan’s written
        consent, settle, compromise, consent to the entry of any judgment in or
        otherwise seek to terminate any claim, action or proceeding in respect of
        which
        indemnity may be sought hereunder, whether or not any Indemnified Person
        is an
        actual or potential party thereto, unless such settlement, compromise, consent
        or termination includes an unconditional release of each Indemnified Person
        from
        any liabilities arising out of such claim, action or proceeding. If the Company
        enters into any agreement or arrangement with respect to, or effects, any
        proposed sale, exchange, dividend or other distribution or liquidation of
        all or
        a significant portion of its assets in one or a series of transactions or
        any
        significant recapitalization or reclassification of its outstanding securities,
        the Company shall provide for the assumption of its obligations under this
        Section 1 by another party reasonably satisfactory to JPMorgan.

      

      (c)  If
        the foregoing
        indemnification is unavailable or insufficient to hold an Indemnified Person
        harmless in respect of any Liabilities (and related expenses) referred to
        therein then, in lieu of indemnifying such Indemnified Person hereunder,
        the
        Company shall contribute to the amount paid or payable by such Indemnified
        Person as a result of such Liabilities (and related expenses) in such proportion
        as is appropriate to reflect the relative benefits to the Company, on the
        one
        hand, and JPMorgan, on the other hand, of the financial advice rendered by
        JPMorgan and also the relative fault of each of the Company and JPMorgan,
        as
        well as any other relevant equitable considerations; provided,
however, that in no event shall the Indemnified Persons be required
        to
        contribute an aggregate amount in excess of the aggregate amount of fees
        actually received by JPMorgan under the Engagement Letter.

       

      
        
          
            
            

          

          
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            Altair
              Nanotechnologies Inc.

            April
              __, 2006

          

        

         

         

      

      Section
        2. Financial Advisory Role,
        Information, Reliance, Confidentiality, etc.

      

      (a)  The
        Company understands
        that JPMorgan is acting solely as a financial advisor, is acting as an
        independent contractor and is not undertaking to provide any legal, accounting
        or tax advice in connection with its engagement under the Agreement and
        that JPMorgan's role
        in any due diligence will be limited solely to performing such review as
        it
        shall deem necessary to support its own advice and analysis and shall not
        be on
        behalf of the Company.

      

      (b)
        The Company agrees to provide to
        JPMorgan all information requested by JPMorgan for the purpose of its engagement
        under the Agreement and also to provide access to employees and directors
        of the
        Company.  The Company also agrees that upon closing of any
        Transaction, the Company shall notify JPMorgan, in writing, (i) whether it
        expects to treat the consummated Transaction as a “reportable transaction”
within the meaning of Treasury Regulation Section 1.6011-4(b), and (ii) if
        so,
        the applicable category of “reportable transaction”.  JPMorgan shall
        be entitled to rely upon and assume, without any obligation of independent
        verification, the accuracy and completeness of all information that is publicly
        available and of all information that has been furnished to it by the Company
        or
        any party to a potential Transaction or Alternative Transaction or otherwise
        reviewed by JPMorgan, and JPMorgan shall not assume any responsibility or
        have
        any liability therefor.  JPMorgan has no obligation to conduct any
        appraisal of any assets or liabilities or to evaluate the solvency of the
        Company or any other party to a Transaction or Alternative Transaction under
        any
        state or federal laws relating to bankruptcy, insolvency or similar
        matters.

      

      (c)
        In order to enable JPMorgan to
        bring relevant expertise to bear on its engagement under the Agreement from
        among its global affiliates, the Company agrees that JPMorgan may share
        information obtained from the Company hereunder with its affiliates, and
        may
        perform the services contemplated hereby in conjunction with its affiliates,
        and
        that any JPMorgan affiliates performing services hereunder shall be entitled
        to
        the benefits and subject to the terms of the Agreement. The Company agrees
        that
        JPMorgan shall have the right to review and pre-approve any reference to
        it or
        its role as financial advisor under the Agreement in any public statement
        made
        by the Company (such approval not to be unreasonably withheld).

      

      (d)
        JPMorgan’s financial advice is
        intended solely for the benefit and use of the Board of Directors of the
        Company
        in considering the matters to which the Engagement Letter relates, is not
        on
        behalf of, and shall not confer rights or remedies upon, any shareholder
        or
        creditor of the Company or any other person, and may not be used or relied
        upon
        for any other purpose.  Except as otherwise required by applicable law
        or governmental or stock exchange regulation, the Company will treat JPMorgan’s
        advice as confidential and will not disclose it to any third party (other
        than,
        on a confidential basis, to its counsel and other advisors in connection
        with a
        Transaction) in any manner without JPMorgan's prior written
        approval.

      

      (e)
        Information provided by the Company
        to JPMorgan in connection with this Agreement will be kept confidential and
        will
        only be used by JPMorgan for purposes of its engagement hereunder, except
        information that (i) was in JPMorgan's possession prior to its disclosure
        by the
        Company; (ii) is publicly disclosed other than by JPMorgan in violation of
        the
        Agreement; (iii) is obtained by JPMorgan from a person other than the Company
        who, to the knowledge of JPMorgan, is not bound by a confidentiality agreement
        with the Company; (iv) the Company agrees may be disclosed; or (v) is required
        or requested to be disclosed under compulsion of law (whether by oral question,
        interrogatory, subpoena, civil investigative demand or otherwise), by order
        or
        act of any court or governmental or regulatory authority or body or by
        JPMorgan's independent auditors or accountants. JPMorgan may also disclose
        such
        information to those of its own and its affiliates’ respective officers,
        directors, employees, representatives, auditors and professional advisors
        who
        need to know such information for purposes of performing the services described
        in the Agreement, and to potential parties to an Alternative Transaction
        who
        have executed confidentiality agreements with or for the benefit of the Company
        in a form reasonably satisfactory to the Company.  JPMorgan’s
        obligations under the first sentence of this paragraph shall terminate two
        years
        from the date hereof.

       

      
        
          
            
            

          

          
            5

            
              

            

          

          
            
            

            Altair
              Nanotechnologies Inc.

            April
              __, 2006

          

        

      

      
 

      (f)
        Notwithstanding any other provision
        herein, the Company and each of its employees, representatives or other agents
        may disclose to any and all persons, without limitation of any kind, the
        U.S.
        income and franchise tax treatment and the U.S. income and franchise tax
        structure of the transactions contemplated hereby and all materials of any
        kind
        (including opinions or other tax analyses, if any) that are provided to the
        Company relating to such tax treatment and tax structure insofar as such
        treatment and/or structure relates to a U.S. income or franchise  tax
        strategy, if any, provided to the Company by JPMorgan or its
        affiliates.

      

      Section
        3. Other Business
        Relationships.

      

      (a)
        You understand that JPMorgan and
        its affiliates (collectively, “Morgan”) comprise a full service securities firm
        and a commercial bank engaged in securities trading and brokerage activities,
        as
        well as providing investment banking, asset management, financing, and financial
        advisory services and other commercial and investment banking products and
        services to a wide range of corporations and individuals.  In the
        ordinary course of our trading, brokerage, asset management, and financing
        activities, Morgan may at any time hold long or short positions, and may
        trade
        or otherwise effect transactions, for our own account or the accounts of
        customers, in debt or equity securities or senior loans of the Company or
        any
        other company that may be involved in any transaction with the Company. Morgan
        recognizes its responsibility for compliance with federal securities laws
        in
        connection with such activities.

      

      (b)
        In addition, Morgan may have and
        may in the future have investment and commercial banking, trust and other
        relationships with parties other than the Company, which parties may have
        interests with respect to the Company or a transaction with the Company or
        any
        other party thereto. Without limiting the foregoing, the Company acknowledges
        that, in agreeing to provide the advisory services contemplated by the
        Agreement, JPMorgan reserves the right of Morgan to pursue opportunities
        to
        arrange and/or provide new financing to other potential parties to a transaction
        with the Company specifically in connection with such transaction.
 Notwithstanding anything contained herein,
        Morgan shall not act as M&A financial advisor to any party (other than the
        Company) in connection with any such transaction with the Company during
        the
        term of the Agreement. Although Morgan in the course of such other relationships
        may acquire information about any such transaction or such other parties,
        Morgan
        shall have no obligation to disclose such information, or the fact that Morgan
        is in possession of such information, to the Company or to use such information
        on the Company’s behalf.  Furthermore Morgan may have fiduciary or
        other relationships whereby Morgan may exercise voting power over securities
        of
        various persons, which securities may from time to time include securities
        of
        the Company or others with interests with respect to a transaction with the
        Company. The Company acknowledges that Morgan may exercise such powers and
        otherwise perform its functions in connection with such fiduciary or other
        relationships without regard to its relationship to the Company
        hereunder.

      

      Section
        4.
Miscellaneous.  The Agreement may not be assigned by the
        Company or JPMorgan without the prior written consent of the other. The
        Agreement constitutes the entire understanding of the parties with respect
        to
        the subject matter thereof, supersedes all prior agreements with respect
        thereto, may not be amended except in writing signed by both of the parties,
        has
        been duly authorized and executed by each of the parties hereto and constitutes
        the legal, binding obligation of each such party.  The Agreement shall
        be governed by and construed in accordance with the laws of the State of
        New
        York without reference to principles of conflicts of law. Each of the Company
        and JPMorgan irrevocably and unconditionally submits to the exclusive
        jurisdiction and venue of any State or Federal court sitting in New York
        City
        over any action, suit or proceeding arising out of or relating to this
        Agreement.  Each of the Company and
        JPMorgan irrevocably and unconditionally waives any objection to the laying
        of
        venue of any such action brought in any such court and any claim that any
        such
        action has been brought in an inconvenient forum.  JPMorgan and the
        Company (on its own behalf and, to the extent permitted by law, on behalf
        of its
        shareholders) each waives any right to trial by jury in any action, claim,
        suit
        or proceeding with respect to JPMorgan’s engagement as financial advisor under
        the Agreement or its role in connection herewith.

      

      
6altair_8k-ex1004.htm

    
      

    

     

    Exhibit
      10.4

     

    September
      24, 2007

    

    

    Private
      and Confidential

    

    Mr.
      Alan
      J. Gotcher, Ph.D.

    President
      & CEO

    Altair
      Nanotechnologies Inc.

    204
      Edison Way

    Reno,
      NV
      890502

    

    Ladies
      and Gentlemen:

    

    Pursuant
      to the April 21, 2006 Letter
      Agreement between Altair Nanotechnologies Inc. (the "Company") and J.P. Morgan
      Securities Inc. ("JPMorgan") the parties are entering into this letter agreement
      in order to set forth the specific terms and conditions in connection with
      the
      proposed issuance, offering and sale by the Company (the "Offering") of
      approximately $25 million to $50 million of equity or equity-linked securities
      (the "Securities") on a private placement basis.

    

    1.           Best
      Efforts Placement.  The Company has engaged JPMorgan to act as
      sole placement agent on a best efforts basis for the Offering.  The
      Company acknowledges and agrees that JPMorgan's engagement hereunder is not
      an
      agreement by JPMorgan or any of its affiliates to underwrite or purchase any
      securities or otherwise provide any financing.

    

    2.           Exclusive
      Engagement.  During the period of JPMorgan’s engagement hereunder,
      the Company will not, and will cause its affiliates not to, discuss the Offering
      or any other placement or sale of equity or equity-related securities with
      any
      third parties (except through JPMorgan) and it will promptly notify JPMorgan
      if
      it receives any inquiry concerning the Securities.  The Company
      represents and agrees that no offers or sales of securities of the same or
      a
      similar class as the Securities have been made or will be made by the Company
      or
      on its behalf that would be integrated with the offer and sale of the Securities
      under the doctrine of integration referred to in Regulation D under the
      Securities Act of 1933, as amended.  Notwithstanding the foregoing,
      the Company shall not be prohibited by this Section 2 from discussing the
      issuance, and or issuing, its equity or equity-linked securities to
      counterparties in connection with licensing agreements entered into with such
      counterparties provided that the
      Company will take all necessary steps to ensure that any such offering and
      sale
      of its securities are exempt from the registration requirements of the
      Securities Act pursuant to Rule 506 of Regulation D
      thereunder.

    

    3.           Indemnification
      and Contribution.  In consideration of the engagement hereunder,
      the Company agrees to the indemnification and contribution provisions set forth
      in Annex A hereto, which provisions are incorporated by reference herein and
      constitute a part hereof.

    

    4.           Fees
      and Expenses.  The Company agrees to pay JPMorgan an initial
      retainer of $75,000 upon the signing of this letter agreement.  This
      retainer is nonrefundable but shall be credited against any further fees payable
      to JPMorgan hereunder.  In addition, as compensation for its services
      hereunder, the Company agrees to pay JPMorgan at each closing for the sale
      of
      Securities a placement fee equal to 6.0% of the value of the Securities sold
      at
      such closing, in cash; provided, however, that the minimum aggregate cash
      consideration, if any, to be paid to JPMorgan in connection with this engagement
      shall not be less than $1,500,000.

     

    The
      Company agrees to reimburse JPMorgan promptly upon request for all reasonable
      out-of-pocket costs and expenses (including, without limitation, reasonable
      fees, disbursements and other charges of legal counsel and other experts)
      incurred in connection with this letter agreement or any of the transactions
      contemplated hereby, whether or not any Securities are issued, offered or sold;
      provided, however, that the Company’s reimbursement obligation pursuant to this
      sentence shall not exceed $75,000 in the aggregate without its prior
      consent.  In addition, as is customary in private placements, the
      Company will also pay the fees and expenses of one counsel for the purchasers
      of
      the Securities, such counsel to be mutually acceptable to the Company and
      JPMorgan.

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    5.           Disclosure.  In
      connection with its engagement hereunder, JPMorgan will assist the Company
      in
      preparing a private placement memorandum and/or other documents to be used
      in
      connection with the Offering (the "Offering Document").  The Company
      acknowledges and agrees that the Offering Document is its own work product,
      that
      JPMorgan may rely, without independent verification, upon the accuracy and
      completeness of all information furnished by the Company to JPMorgan for use
      in
      connection with the Offering (collectively, the "Information") and that JPMorgan
      does not assume any responsibility therefor.

    

    The
      Company represents that (i) the Information and the Offering Document will
      not
      include an untrue statement of a material fact or omit to state a material
      fact
      necessary in order to make the statements therein, in the light of the
      circumstances under which they were made, not misleading, (ii) all historical
      financial data provided to JPMorgan will be prepared in accordance with
      generally accepted accounting principles and practices then in effect in the
      United States and will fairly present the financial condition and operations
      of
      the Company and (iii) any forecasted financial, market or industrial information
      provided to JPMorgan will be prepared in good faith with a reasonable basis
      for
      the assumptions and the conclusions reached therein. In addition, the Company
      agrees that it will notify JPMorgan promptly if any of the foregoing
      representations ceases to be accurate at any time during the period of
      JPMorgan's engagement hereunder.

    

    6.           Engagement
      Period, Termination and Survival. JPMorgan’s engagement hereunder may be
      terminated by JPMorgan or the Company at any time upon 10 days' prior written
      notice to the other party.  The provisions of this letter agreement
      relating to the payment of fees and expenses, indemnification and contribution,
      references to JPMorgan and governing law will survive any termination or
      expiration of this letter agreement.  In addition, if any person
      contacted by JPMorgan during the term of its engagement hereunder and with
      whom
      JPMorgan had substantive discussions regarding the Offering purchases
      Securities, or any substantially similar securities, from the Company during
      the
      12-month period following termination of this letter agreement, the Company
      shall pay JPMorgan, upon the closing of such sale, a cash fee equal to the
      amount that would have been payable had this letter agreement not been
      terminated.

    

    7.  Matters
      Relating to Engagement.  The Company acknowledges that JPMorgan
      has been retained solely to provide the services set forth herein.  In
      rendering such services, JPMorgan shall act as an independent contractor, and
      any duties of JPMorgan arising out of its engagement hereunder shall be owed
      solely to the Company.  In addition, the Company agrees that JPMorgan
      may perform the services contemplated hereby in conjunction with its affiliates,
      and that any JPMorgan affiliates performing services hereunder shall be entitled
      to the benefits and be subject to the terms of this letter
      agreement.

    

    Following
      completion of this engagement, JPMorgan shall have the right to place
      advertisements in financial and other newspapers and journals at its own expense
      describing its services to the Company hereunder.  JPMorgan may not,
      without its prior written consent, which shall not be unreasonably withheld,
      be
      quoted or referred to in any document, release or communication prepared, issued
      or transmitted by the Company (including any entity controlled by, or under
      common control with, the Company or any director, officer, employee or agent
      thereof).

     

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    The
      Company acknowledges that JPMorgan is a securities firm engaged in securities
      trading and brokerage activities and providing investment banking and financial
      advisory services.  In the ordinary course of business, JPMorgan and
      its affiliates may at any time hold long or short positions, and may trade
      or
      otherwise effect transactions, for their own account or the accounts of
      customers, in debt or equity securities of the Company, its affiliates or other
      entities that may be involved in the transactions contemplated
      hereby.

    

    In
      addition, JPMorgan and its
      affiliates may from time to time perform various investment banking, commercial
      banking and financial advisory services for other clients and customers who
      may
      have conflicting interests with respect to the Company or the
      Offering.  JPMorgan and its affiliates will not use confidential
      information obtained from the Company pursuant to this engagement or their
      other
      relationships with the Company in connection with the performance by JPMorgan
      and its affiliates of services for other companies, and JPMorgan and its
      affiliates will not furnish any such information to other
      companies.  The Company also acknowledges that JPMorgan and its
      affiliates have no obligation to use in connection with this engagement, or
      to
      furnish to the Company, confidential information obtained from other
      companies.

    

    Furthermore,
      the Company acknowledges that JPMorgan and its affiliates may have fiduciary
      or
      other relationships whereby JPMorgan and its affiliates may exercise voting
      power over securities of various persons, which securities may from time to
      time
      include securities of the Company or of potential purchasers of the Securities
      or others with interests in respect of the Offering.  The Company
      acknowledges that JPMorgan and its affiliates may exercise such powers and
      otherwise perform its functions in connection with such fiduciary or other
      relationships without regard to JPMorgan’s relationship to the Company
      hereunder.

    

    The
      Company acknowledges that JPMorgan
      is not an advisor as to legal, tax, accounting or regulatory matters in any
      jurisdiction.  The Company shall consult with its own advisors
      concerning such matters and shall be responsible for making its own independent
      investigation and appraisal of the transactions contemplated hereby, and
      JPMorgan shall have no responsibility or liability to the Company with respect
      thereto.

    

    The
      Company acknowledges that the terms
      of this letter agreement are contingent upon the receipt by JPMorgan of
      appropriate Commitment Committee approval.  JPMorgan shall promptly
      notify the Company upon receipt of Commitment Committee approval.

    

    8.           Governing
      Law.  This letter agreement, including Annex A hereto, shall be
      governed by and construed in accordance with the laws of the State of New York,
      without giving effect to the conflicts of laws principles
      thereof.  The Company and JPMorgan irrevocably agree to waive trial by
      jury in any action, proceeding, claim or counterclaim brought by or on behalf
      of
      either party related to or arising out of this letter agreement or the
      performance of services hereunder.

    

    9.           Miscellaneous.  This
      letter agreement contains the entire agreement between the parties relating
      to
      the subject matter hereof and supersedes all oral statements and prior writings
      with respect thereto.  This letter agreement may not be amended or
      modified except by a writing executed by each of the parties
      hereto.  Section headings herein are for convenience only and are not
      a part of this letter agreement.  This letter agreement is solely for
      the benefit of the Company and JPMorgan, and no other person (except for
      indemnified persons to the extent set forth in Annex A hereto) shall acquire
      or
      have any rights under or by virtue of this letter agreement.  This
      letter agreement may not be assigned by either party hereto without the other
      party’s prior written consent provided that this letter agreement may be
      assigned to the successor in interest of either the Company or JPMorgan in
      connection with a sale of all or substantially all of the assets of such party
      or a merger in which such party is not the surviving entity.  Neither
      party hereto shall be responsible or have any liability to any other party
      for
      any indirect, special or consequential damages arising out of or in connection
      with this letter agreement or the transactions contemplated hereby, even if
      advised of the possibility thereof.

    

    This
      letter agreement may be executed
      in counterparts, each of which will be deemed an original, but all of which
      taken together will constitute one and the same instrument.

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    

    If
      the foregoing correctly sets forth
      our understanding, please so indicate by executing this letter, together with
      the enclosed duplicate originals, in the place indicated and returning two
      (2)
      of these originals for our files, together with a check for our retainer in
      the
      amount of $75,000 (payable to J.P. Morgan Securities Inc.).

    

     

    
      	 	
              Very
                truly yours,

              

              

              J.P.
                MORGAN SECURITIES INC.

              

              

              By: 
                /s/ Norman D. Colbert

                   Name:
                Norman D. Colbert

                   Title:
                Managing Director

              

            

    

     

     

    

     

     

    Accepted
      and agreed to as of

    the
      date
      first written above.

    

    ALTAIR
      NANOTECHNOLOGIES INC.

    

    

    By:
      /s/     Alan J.
      Gotcher                    
 

         Name:
      Alan J. Gotcher, Ph.D.

         Title:
      President & CEO

    

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

     

    
 

    
      	 	
              

               

              J.P.
                Morgan Securities Inc.

              277
                Park Avenue, 3rd Floor

              New
                York, NY 
10172 

            

    

       

     

     

    ANNEX
      A        

    

    

    The
      Company agrees to indemnify and hold harmless JPMorgan, its affiliates and
      their
      respective officers, directors, employees, agents and controlling persons (each
      an "Indemnified Person") from and against any and all losses, claims, damages,
      liabilities and expenses, joint or several, to which any such Indemnified Person
      may become subject arising out of or in connection with the transactions
      contemplated by the letter agreement to which this Annex A is attached (the
      “Agreement”), or any claim, litigation, investigation or proceedings relating to
      the foregoing ("Proceedings") regardless of whether any of such Indemnified
      Persons is a party thereto, and to reimburse such Indemnified Persons for any
      legal or other expenses as they are incurred in connection with investigating,
      responding to or defending any of the foregoing, provided that the
      foregoing indemnification will not, as to any Indemnified Person, apply to
      losses, claims, damages, liabilities or expenses to the extent that they are
      finally judicially determined to have resulted from the gross negligence or
      willful misconduct of any Indemnified Person.  The Company also agrees
      that no Indemnified Person shall have any liability (whether direct or indirect,
      in contract, tort or otherwise) to the Company for or in connection with the
      Agreement, any transac­tions con­templated thereby or JPMorgan's role or
      services in connec­tion there­with, except to the extent that any
      liability for losses, claims, demands, damages, liabil­ities or
      expens­es incurred by the Company are finally judicially deter­mined to
      have resulted from the gross negligence or willful misconduct of such
      Indemnified Person.

    

    If
      for
      any reason the foregoing indemnification is unavailable to any Indemnified
      Person or insufficient to hold it harmless, then the Company shall contribute
      to
      the amount paid or payable by such Indemnified Person as a result of such loss,
      claim, damage, liability or expense in such proportion as is appropriate to
      reflect not only the relative benefits received by the Company on the one hand
      and such Indemnified Person on the other hand but also the relative fault of
      the
      Company and such Indemnified Person, as well as any relevant equitable
      considerations.  It is hereby agreed that the relative benefits to the
      Company on the one hand and all Indemnified Persons on the other hand shall
      be
      deemed to be in the same proportion as (i) the total value received or proposed
      to be received by the Company pursuant to any sale of the Securities (whether
      or
      not consummated) bears to (ii) the fee paid or proposed to be paid to JPMorgan
      in connection with such sale.  The indemnity, reimbursement and
      contribution obligations of the Company under these paragraphs shall be in
      addition to any liability which the Company may otherwise have to an Indemnified
      Person and shall be binding upon and inure to the benefit of any successors,
      assigns, heirs and personal representatives of the Company and any Indemnified
      Person.

    

    Promptly
      after receipt by an
      Indemnified Person of notice of the commencement of any Proceedings, such
      Indemnified Person will, if a claim is to be made hereunder against the Company
      in respect thereof, notify the Company in writing of the commencement thereof;
      provided that (i) the omission so to notify the Company will not relieve
      it from any liability which it may have hereunder except to the extent it has
      been materially prejudiced by such failure and (ii) the omission so to notify
      the Company will not relieve it from any liability which it may have to an
      Indemnified Person otherwise than on account of this indemnity
      agreement.  In case any such Proceedings are brought against any
      Indemnified Person and it notifies the Company of the commencement thereof,
      the
      Company will be entitled to participate therein and, to the extent that it
      may
      elect by written notice delivered to the Indemnified Person, to assume the
      defense thereof with counsel reasonably satisfactory to such Indemnified Person;
      provided that if the defendants in any such Proceedings include both the
      Indemnified Person and the Company and the Indemnified Person shall have
      concluded that there may be legal defenses available to it which are different
      from or additional to those available to the Company, the Indemnified Person
      shall have the right to select separate counsel to assert such legal defenses
      and to otherwise participate in the defense of such Proceedings on behalf of
      such Indemnified Person.  Upon receipt of notice from the Company to
      such Indemnified Person of its election so to assume the defense of such
      Proceedings and approval by the Indemnified Person of counsel, the Company
      will
      not be liable to such Indemnified Person for expenses incurred by the
      Indemnified Person in connection with the defense thereof (other than reasonable
      costs of investigation) unless (i) the Indemnified Person shall have employed
      separate counsel in connection with the assertion of legal defenses in
      accordance with the proviso to the immediately preceding sentence (it being
      understood, however, that the Company shall not be liable for the expenses
      of
      more than one separate counsel (in addition to any local counsel), approved
      by
      JPMorgan, representing the Indemnified Persons who are parties to such
      Proceedings), (ii) the Company shall not have employed counsel reasonably
      satisfactory to the Indemnified Person to represent the Indemnified Person
      within a reasonable time after notice of commencement of the Proceedings or
      (iii) the Company has authorized in writing the employment of counsel for the
      Indemnified Person.

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    The
      Company shall not be liable for any settlement of any Proceedings effected
      without its written consent (which consent shall not be unreasonably withheld),
      but if settled with its written consent or if there be a final judgment for
      the
      plaintiff in any such Proceedings, the Company agrees to indemnify and hold
      harmless each Indemnified Person from and against any and all losses, claims,
      damages, liabilities and expenses by reason of such settlement or
      judgment.  Notwithstanding the immediately preceding sentence, if at
      any time an Indemnified Person shall have requested the Company to reimburse
      such Indemnified Person for legal or other expenses in connection with
      investigating, responding to or defending any Proceedings as contemplated by
      this Annex A, the Company shall be liable for any settlement of any Proceedings
      effected without its written consent if (i) such settlement is entered into
      more
      than 30 days after receipt by the Company of such request for reimbursement
      and
      (ii) the Company shall not have reimbursed such Indemnified Person in accordance
      with such request prior to the date of such settlement.  The Company
      shall not, without the prior written consent of an Indemnified Person (which
      consent shall not be unreasonably withheld), effect any settlement of any
      pending or threatened Proceedings in respect of which indemnity could have
      been
      sought hereunder by such Indemnified Person unless such settlement includes
      an
      unconditional release of such Indemnified Person in form and substance
      satisfactory to such Indemnified Person from all liability on claims that are
      the subject matter of such Proceedings.

    

    Capitalized
      terms used but not defined
      in this Annex A have the meanings assigned to such terms in the
      Agreement.

    

    

    

    

    
      
        
          
          

        

        
          2

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