Document:

Exhibit 10.1

    

      EXECUTIVE
        SEPARATION AND CONSULTING AGREEMENT

      

      

      This
        Executive Separation and Consulting Agreement (the "Agreement") made and
        entered
        into as of the 11 th
        day of
        January 2007, between eMagin Corporation, a Delaware corporation (the
        "Company"), and Gary Jones (the "Executive").

      

      

      WITNESSETH:

      

      WHEREAS,
        the Company and the Executive entered into an Executive Employment Agreement
        effective January 1, 2006 (“Agreement A”) and an Amendment No. 1 to the
        Executive Employment Agreement dated April 17, 2006 (“Agreement B”),
        cumulatively referred to as the “Employment Agreements”.

      

      WHEREAS,
        by mutual agreement with the Company, the Executive will terminate employment
        with the Company by the terms of this Agreement that will amend and, to the
        extent provided herein, supersede all prior Employment agreements, effective
        as
        of January 11, 2007 (the “Effective Date”), and provide for the Executive to
        remain available as a consultant to advise the Company on M&A and other
        matters as long as both the Executive and a majority of the Board of Directors
        of the Company agree to continuing the consultancy.

      

      NOW,
        THEREFORE, in consideration of and for the mutual promises and covenants
        contained herein, and for other good and valuable consideration, the receipt
        of
        which is hereby acknowledged, the Executive Employment Agreement is hereby
        amended to incorporate terms as follows:

      

      

      1.
        Consideration and Terms of Compensation

      

      The
        Company hereby agrees to award the Executive certain payments in exchange
        for
        the Executive’s agreement to terminate his employment with the Company in
        accordance with this Agreement, as well as for amounts that are currently
        owed
        to the Executive prior to the termination of employment.. In addition, to
        better
        enable and encourage the Executive to assist the Company as a consultant,
        certain post-termination arrangements are provided in this
        Agreement.

      

      1.1
        Cash
        Amounts owed to Executive at time of termination of Employment:

      Executive
        will be paid the following in cash (or as a confirmation of a credit against
        any
        withholding taxes owed by the employee) within 4 business days of the Effective
        Date: (a) all salary accrued as of the Effective Date plus the equivalent
        of 30
        days of salary; (b) the equivalent of salary for all unused sick, personal
        choice holidays, and personal days accrued as of the Effective Date; (c)
        payment
        for accrued vacation equaling 360 hours of vacation time as of the Effective
        Date. Any other amounts due the Executive on the Effective Date will also
        be
        paid within 4 days (or as a confirmation of a credit against any withholding
        taxes owed by the employee) of the Effective Date.

      

      1.2
        Tax
        overpayments previously paid by the Executive which have been or will be
        refunded directly to the Company, per written notice received from the Company’s
        tax accountant, will be paid to the Executive within 4 days of the Effective
        Date.

      

      1.3
        Stock
        paid to Executive at time of termination of Employment

      The
        Company agrees to grant Executive 500,000 registered shares of common stock
        in
        eMagin Corporation from the Employee Stock Plan (“the Plan”) or other
        unrestricted stock plan. Such shares shall be DWAC-wired to the broker
        designated by the Executive on the Effective Date, 11:00AM EST. The Company
        will
        arrange with the transfer agent to ensure compliance with this delivery
        date.

      

      1.4
        Executive will be granted a cash payment of $460,000 upon a change of control
        event, whether occurring as a result of single or multiple events, such as
        sale
        of the Company through the sale of stock or equivalent interest representing
        a
        majority of the Company from the Effective Date, a sale or transfer of all,
        or a
        majority of the Company’s assets reported by the Company in a SEC filing or
        press release, equity or debt financing resulting in an effective change
        of
        control in one or more steps (calculated as if fully converted), or effective
        change of control by way of a sale or transfer of rights to a substantial
        portion of the future product output or intellectual property of the Company
        (e.g., providing another company an exclusivity for any major markets or
        providing rights to another company to produce products using the company’s OLED
        technology (collectively, a “Change of Control”). The foregoing Change of
        Control payment shall be due and payable only if, and when, such Change of
        Control of the Company results in the payment of the Company’s senior secured
        debt, when such debt is converted to equity, or there is a restructuring
        of the
        Company where the majority of the debt amounts due the lenders is agreed
        to be
        restructured by the lenders all or in part.

       

       

       

      
        
          
          

        

        
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      1.5
        In
        addition, Executive agrees to reasonably pursue the general type Change of
        Control transactions listed in Section 1.4 and to devote reasonable best
        efforts, time and attention, unless otherwise mutually agreed by the Executive
        and the Chairman of the Board of Directors of the Company, or if there is
        any
        change in direction of the Company away from actively pursuing such a long
        term
        or short term Change of Control as a primary effort. Any such effort by the
        Executive requires reasonable support to the Executive by the Company,
        attorneys, and bankers toward the pursuit of such a Change of Control. Moreover,
        Executive shall provide the Board of Directors of the Company with weekly
        reports describing Executive’s activities during the prior calendar week with
        respect to his consulting efforts on behalf of the Company in accordance
        with
        this Agreement.

      

      1.6
        Section 16 Filings

      The
        Company will provide the highest priority and conscientious support in issuing
        all shares as specified in this Agreement, with all transfer and registration
        costs borne by the Company. Unlimited registration rights are provided for
        all
        stock granted to the Executive. The Company’s attorneys will, at Company
        expense, provide prompt assistance to convert all Executive’s stock to free
        trading status and to file the necessary Form 4 paperwork to complete the
        stock
        issuances properly and fully assist the Executive with his Section 16 filing
        requirements consistent with the Company’s past practices.

      

      1.7
        Withholdings for Taxes:

      Taxes
        will be withheld and paid in a standard manner for ordinary income in 2007
        for
        all cash payments made pursuant to this Agreement consistent with the Company’s
        past practices. Stock issuance withholdings will be based on a Moss Adams
        report
        discount valuation of the market closing bid price as reported by the American
        Stock Exchange on the day of issuance to take into account block discount
        valuation reduction effects.

      

      1.8
        Voluntary Forfeiture of Executive’s Options

      Upon
        the
        execution of this Agreement, Executive agrees to forfeit all of the options
        currently held by the Executive in the Company. (Approximately 230,000
        options).

      

      2.0
        Use of Office and Equipment

      

      The
        Executive will retain use of his current Company offices and communications
        pathways in both Hopewell Junction, NY and Bellevue, WA, including current
        office and communications support, equipment, telephone access,
        Company-supported land line or cell phones as has been done previously, and
        other Executive support provided at Company expense by the Company, until
        the
        earlier of (i) end of calendar year 2007, (ii) a change of control, or (iii)
        when the Executive begins full-time employment elsewhere. The Executive will
        furthermore retain use of all mobile and home based electronic and
        communications equipment, data, media, and supplies provided by the company
        for
        use primarily by the employee for up to 28 months from the Effective Date,
        provided that Company data is copied for the Company’s use.

      

      3.0
        Provisions for Moving Personal Effects

      

      The
        Company will provide up to $7,500 for reasonable packing of all of Executive’s
        personal effects currently located in New York Company offices or storage
        space
        and shipping such items to up to two locations within the general area of
        the
        Company’s Bellevue Offices, to be specified by the Executive. All personal
        effects and files on the premises or in storage will remain confidential
        to the
        Executive. Travel associated with assisting in the clearing out this space
        will
        also be a permissible expense to the Company or its acquirer. To the extent
        the
        foregoing payment is deemed to constitute taxable income to the Executive
        by a
        tax professional, the Company shall also pay to the Executive the amount
        of any
        actual federal and State income taxes incurred by the Executive in connection
        with this payment.

      

      

       

       

      
        
          
          

        

        
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      4.0
        Personal Benefits

      

      Executive
        will be provided all insurance benefits as when previously employed through
        the
        earlier of March 31, 2007, or the Sale of the Company or substantially all
        of
        the Company’s assets, at Company expense free of any cost or tax to the
        Executive. All medical, insurance, and dental benefits will be covered during
        this period. Thereafter, Executive will be provided with right to participate
        in
        full COBRA (or equivalent) Company insurance plans.

      

      5.0
        No
        Arbitration; Time is of the Essence

      

      5.1
        This
        Agreement is hereby agreed to and is not subject to arbitration to negotiate
        the
        stated terms or validity. The Company agrees that payment of all cash due
        to the
        Executive and payment of stock in DWAC or DTC form will be made on the dates
        designated elsewhere in this Agreement, or within 2 days of the Effective
        Date,
        whichever is later.

      

      Time
        is of the essence
        for all
        payments due within 10 business days of the Effective Date (namely, payments
        due
        under section 1.0) and no arbitration or legal issues shall in any way be
        permitted to delay these required payments. Financial compensation alone
        would
        not be sufficient compensation for breach of the Company’s duty to make these
        payments.

      

      Additionally,
        a 12% initial penalty on the 1st late business day a payment is late plus
        an
        interest rate equal to the maximum fee and penalty limits of Washington State
        law plus any other losses incurred by the Executive due to the delayed payments
        due within 10 business days of the Effective Date. These fees and penalties
        would apply to the entire value of any delayed cash or stock payments due
        within
        10 business days of the Effective Date, with the stock pricing value being
        the
        most recent AMEX closing price as of the date of this agreement or the date
        of
        each late assessment, whichever is higher based on the most recent quoted
        closing price of the Company’s common stock quoted by the American Stock
        Exchange or whatever exchange or quotation system the Company’s common stock may
        then be listed or quoted on.

      

      All
        late
        fees and penalties, including all costs of collection and legal costs, arising
        from non-payment of the amounts due (either by direct payment or by way of
        credit against the Executive’s liabilities at the time of the termination of
        Executive’s employment, will be paid in cash immediately when due and any late
        fees or penalties will accrue the same fees and penalties as other late payments
        in this Agreement.

      

      6.0
        Non-Competition and Non-Solicitation

      

      6.1
        The
        following modification replaces and supersedes Section 4.1 of Agreement A.
        The
        Executive hereby agrees that for a period of one year following the Effective
        Date, the Executive will not, without the prior written consent of the Company,
        have any direct interest in any person, firm, corporation or business competing
        with the Company in the Covered Area. For purposes of this Section 6.1
        (i)“Competing Business” means any company engaging directly in the manufacturing
        of OLED on single crystal silicon microdisplays. For purposes of this Section
        7.1 (ii) “Covered Area” means all geographical areas of the United States, and
        other foreign jurisdictions where the Company has offices or manufactures
        OLED
        microdisplays. The Executive will not be restricted in participating in
        businesses that may purchase, utilize, design products, sell or resell any
        types
        of displays or related products, nor will the Executive be restricted in
        any
        technology areas other than directly in OLED microdisplay manufacturing.
        The
        Executive will also not be restricted in investing in or managing investments
        in
        any display, lighting, or imaging companies of any kind. Furthermore, for
        a
        period of one (1) year following the Effective Date, Executive will not,
        directly solicit for employment any officer, director or senior level employee
        of the Company except that Executive shall not be precluded from hiring (i)
        any
        such employee who has been terminated by the Company or the employee prior
        to
        commencement of employment discussions between Executive and such employee,
        (ii)
        any such employee who contacts Executive on his or her own initiative without
        any direct or indirect solicitation by or encouragement from Executive or
        (ii)
        any such employee that responds to a general advertisement and other similar
        broad forms of solicitation (including solicitations by a recruiting firm
        hired
        by Executive).

      

      7.0
        Release by the Executive

      

      In
        consideration for the promises and undertakings of the Company under this
        Agreement, the Executive hereby unconditionally releases and forever discharges
        the Company from any and all claims, demands, causes of action, suits, damages,
        remedies, obligations, debts and liabilities whatsoever, whether known or
        unknown, suspected or unsuspected, both at law and in equity, except for
        any
        claim which arises out of or is in any way related to this Agreement, which
        the
        Executive now has, has ever had or may hereafter have against the Company
        arising contemporaneously with or prior to the Effective Date or on account
        of
        or arising out of any matter, cause or event occurring contemporaneously
        with or
        prior to the Effective Date.

      

      

       

       

      
        
          
          

        

        
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      8.0
        Publicity

      

      The
        Company and Executive agree that all publicity or other public statements
        related to Executive will be mutually approved by both the Executive and
        the
        Chairman of the Board of the Company prior to issuance; provided, however,
        that
        the Company shall be entitled to make all public statements and disclosures
        it
        reasonably determines is necessary to comply with all applicable
        laws.

      

      9.
        Other Provisions

      

      9.1
        The
        parties acknowledge that while the Executive will be acting following the
        termination of his employment as a consultant to the Company, he will serve
        as
        an independent advisor and not in any other capacity including as a fiduciary,
        except to the extent of fiduciary duties arising from the Executive’s duties (if
        any) as a Director of the Company. Neither this Agreement nor the delivery
        of
        any advice in connection with this engagement is intended to confer rights
        upon
        any persons not a party hereto (including security holders, employees or
        creditors of the Company) as against the Executive or the Company. The Company
        agrees to indemnify the Executive against any claims related to the Company
        and
        the Company’s actions, other than claims of gross negligence or willful
        misconduct specifically by the Executive.

      

      10.
        Entire Agreement and Other Provisions

      

      This
        is
        the entire agreement, this Agreement supersedes all prior agreements related
        to
        this matter, and this Agreement may only be formally modified when a
        modification is duly executed by the Executive, and the Board of Directors
        of
        the Company, or such employees, agents or representatives that the Board
        shall
        have appointed to make such modifications. The parties hereby acknowledge
        and
        agree that the Confidential Information and Invention Assignment Agreement
        executed by the Executive in favor of the Company shall remain in full force
        and
        effect after the Effective Date for one year.

      

      This
        Agreement is governed by the laws of the Washington, U.S.A. without regard
        to
        conflicts of law principles. The Company and the Executive agree to waive
        trial
        by jury in any action, proceeding or counterclaim brought by or on behalf
        of
        either party with respect to any matter whatsoever relating to or arising
        out of
        any actual or proposed transaction or the engagement of or performance by
        the
        Executive hereunder. With respect to all matters relating to this Agreement,
        the
        Company hereby irrevocably (a) submits to the non-exclusive jurisdiction
        of any
        Washington State or Federal Court sitting in the State of Washington, County
        of
        King, U.S.A.; (b) agrees that all claims related hereto may be heard and
        determined in such courts; (c) waives the defense of an inconvenient forum;
        (d)
        agrees that a final judgment of such courts shall be conclusive and may be
        enforced in another jurisdiction by suit on the judgment or in any other
        manner
        provided by law; and (e) waives any immunity (sovereign or otherwise) from
        jurisdiction of any court or from any legal process that it or its properties
        or
        assets has or may acquire.

      

      

      

       

       

      
        
          
          

        

        
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      This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed an original and all of which taken together shall constitute a single
        agreement. The Agreement may be deemed as executed upon receipt of email
        affirmation, to be followed by execution of physically signed documents within
        five (5) business days.

      

      

      IN
        WITNESS WHEREOF,
        the
        parties hereto have executed this agreement as of the date first stated
        above.

      

      

      “EXECUTIVE”

      

      

      By
        /s/
        Gary Jones

      
        
          
Gary
          Jones

      

      

      

      

      “COMPANY”

      eMagin
        Corporation

      

      

      By
        /s/
        Thomas Paulsen

      
        
Thomas
        Paulsen

      Chairman
        of the Board and Chairman of the Compensation Committee

      

      

      By
        /s/
        Jack Goldman

      
        
Jack
        Goldman

      Compensation
        Committee

      

      

      By
        /s/
        David Gottfried

      
        
David
        Gottfried

      Compensation
        Committee

    

     

    
 

    
      
        
        

      

      
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      EXPENSE
        REIMBURSEMENT AND COMPENSATION SCHEDULE

     

      This
        Agreement (this "Agreement") is made and entered into as of the 11th day
        of
        January, 2007, between eMagin Corporation, a Delaware corporation (the
        "Company"), and Gary Jones ("Jones").

     

      WITNESSETH:

     

      WHEREAS,
        the Company and Jones entered into Employment Agreements effective January
        1,
        2006 (“Agreement A”)
        as
        amended by an Amendment to the Executive Employment Agreement dated April
        17,
        2006 (“Agreement B”) (collectively referred to as the “Employment
        Agreements”).

     

      WHEREAS,
        under terms mutually agreed to with the Company, Jones will terminate employment
        with the Company,
        effective as of January 11, 2007 (the “Effective Date), by the terms of this
        Agreement and pursuant to the
        Executive Separation and Consulting Agreement dated as of January 11, 2007
        (“Agreement C”).

     

      NOW,
        THEREFORE, in consideration of and for the mutual promises and covenants
        contained herein, and for other
        good and valuable consideration, the receipt of which is hereby acknowledged,
        the Company agrees to provide the
        following reimbursements and compensation to Jones at the specified
        timing:

     

      1.0
        Payment of Expense Reports and other Obligations by the
        Company

     

      1.1
        Within 4 business days of the Effective Date, all outstanding expense reports,
        as approved by the Chair of the Board
        or
        such persons designated by the Chair, that were submitted prior to the Effective
        Date will be paid to Jones. The
        Company agrees that preparations will be made ahead to ensure timely payment.
        Additional expense reports, as approved
        by the Chair of the Board or such persons designated by the Chair, turned
        in to
        the Company’s accounting
        department after the Effective Date will be fully paid within 5 business
        days of
        receipt. Expenses consistent with prior approved expenditures in the past
        2
        years as an Executive, or as described in Schedule A will be
        permitted.

     

      1.2
        The
        Company will continue to provide expense support (not to exceed an additional
        $10,000 legal costs following
        the date of this agreement) for legal counsel and other related costs to
        assist
        in the resolution of damage
        and
        missing items from Jones’s relocation to Washington and to assist in the
        recovery of these losses from the mover and the mover’s insurance company until
        such a time the matter is reasonably resolved to the Jones’s satisfaction. All
        costs and any taxes associated with this effort will be at the Company’s
        expense.

     

      1.3
        The
        Company will pay Jones $30,000 upon the signing of this Agreement, and up
        to an
        additional $20,000, within 4 business days following rendering to the Company
        of
        actual invoices with reasonable detail , as approved by the Chair of the
        Board
        or such persons designated by the Chair , incurred by Jones in connection
        with
        legal and accounting expenses related to issues surrounding exercise of Jones’s
        2004 stock options and related tax issues, reviewing
        and commenting on employment agreements, accountant expenses, and expenses
        related to dealing with
        and
        negotiating the eMagin Convertible Note executed July 2006.

     

      1.4
        Jones
        will receive $18,000 as an advance toward future medical insurance and dental
        payments to be paid to the
        Executive upon Change of Control event as discussed in Section 2.2.2. of
        the
        Executive Separation and Consulting Agreement. Until a Change of Control
        event,
        the Company will pay for incremental medical and dental insurance for the
        Executive through its current plan or as an add-on to his spouses
        plan.

     

      1.5
        To
        the extent the foregoing payments are deemed to potentially constitute taxable
        income to Jones by a tax professional, the Company shall also pay to Jones
        the
        amount of any actual federal and State income taxes incurred by Jones in
        connection with this payment.

     

      2.0
        Withholdings for other Taxes due

     

      2.1
        Jones
        and the Company agree to withhold certain payments for 2007 taxes due the
        IRS
        and Social Security without
        invoking the Section 5.0 penalties for the amounts withheld for taxes. Stock
        issuance withholdings will be
        based on
        a 2006 Moss Adams report providing a 32% discount valuation assessment of
        the
        block stock values, already
        provided to the Company. The pre-discount tax valuation would be based on
        the
        market closing bid price as
        reported
        by the American Stock Exchange on the day of issuance.

    

    
      
        
        

      

      
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      Company
        historical standard Employee-Company tax responsibilities will apply to the
        taxes due on issuance of these
        Shares and any taxable payments. These payments would be treated as ordinary
        income, except for travel and
        business
        (e.g., Internet, equipment and software purchased for the company benefit,
        office supplies, and phones) expenses. Jones will be provided with written
        notice of the amount withheld for taxes by the company on the Effective
        Date.

     

      Jones
        will receive the balance payment after all withholdings as a cashable company
        check within 4 days of the
        Effective date.

     

      3.0
        Advances for Expenses

     

      3.1
        During the period Jones acts as advisor to the Company under the terms of
        Agreement C, Jones may elect not to
        incur
        any out-of-pocket reimbursable expenses on behalf of the Company absent
        sufficient advance payment. All out-of-pocket
        expenses are subject to the Company’s approval by the Chair of the Board or such
        persons designated
        by the
        Chair.

     

      An
        initial general expense advance of $5,000 will be provided to Jones to cover
        future travel and other future expenses
        incurred on behalf of the Company toward business partnerships,
        investor-investment opportunities, M&A,
        eMagin
        engineering and manufacturing consultation, marketing, government relations,
        and
        other Company-related travel as well as expenses for printing, office supplies,
        communications, and electronics systems maintenance expenses. Expenses
        consistent with prior approved expenditures in the past 2 years as an Executive,
        or as described in Schedule A will be permitted. The Executive will also
        continue to have use of the company credit card that will be kept active
        with a
        minimum $10,000 available balance as long as the Executive is a consulting
        for
        the company.

     

      3.2
        Special travel of Jones requested by the Chairman of the Board or the CEO
        will
        be handled with additional separate expense advances, to be approved and
        provided prior to travel.

     

      4.0
        No Arbitration; Time is of the Essence

     

      4.1
        This
        Agreement is hereby agreed to and is not subject to arbitration to negotiate
        the
        stated terms or validity. The Company agrees all payment will be made on
        the
        dates designated elsewhere in this Agreement, or within 4 days of the Effective
        Date, whichever is later.

     

      Time
        is of the essence
        for all
        payments due within 10 business days of the Effective Date, and no arbitration
        or legal issues shall in any way be permitted to delay these required payments.
        Financial compensation alone would not be sufficient compensation for breach
        of
        the Company’s duty to make these payments.

     

      Additionally,
        a 12% initial penalty on the 1st late
        business day a payment is late plus an interest rate equal to the maximum
        fee
        and penalty limits of Washington State law plus any other losses incurred
        by the
        Executive due to the delayed payments due within 10 business days of the
        Effective Date. These fees and penalties would apply to the entire value
        of any
        delayed cash or stock payments due within 10 business days of the Effective
        Date, with the stock pricing value being the most recent AMEX closing price
        as
        of the date of this agreement or the date of each late assessment, whichever
        is
        higher based on the most recent quoted closing price of the Company’s common
        stock quoted by the American Stock Exchange or whatever exchange or quotation
        system the Company’s common stock may then be listed or quoted
        on.

     

      All
        late
        fees and penalties, including all costs of collection and legal costs, arising
        from non-payment of the amounts due (either by direct payment or by way of
        credit against the Executive’s liabilities at the time of the termination of
        Executive’s employment, will be paid in cash immediately when due and any late
        fees or penalties will accrue the same fees and penalties as other late payments
        in this Agreement.

    

    
      
        
        

      

      
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      5.0
        Entire Agreement and Other Provisions

     

      This
        Schedule supplements the Executive Termination and Consulting Agreement dated
        January 5, 2007, and to the extent expressly stated herein, supersedes all
        the
        Employment Agreements. This schedule may only be formally modified when a
        modification is duly executed by Jones, the Compensation Committee, and the
        Chairman of the Board of Directors of the Company, or their duly appointed
        representatives.

     

      This
        agreement is governed by the laws of the State of Washington, U.S.A. without
        regard to conflicts of law principles. The Company and Jones agree to waive
        trial by jury in any action, proceeding or counterclaim brought by or on
        behalf
        of either party with respect to any matter whatsoever relating to or arising
        out
        of any actual or proposed transaction or the engagement of or performance
        by
        Jones hereunder. With respect to all matters relating to this agreement,
        the
        Company hereby irrevocably (a) submits to the non-exclusive jurisdiction
        of any
        New York State or Federal Court sitting in the State of Washington County
        of
        King, U.S.A.; (b) agrees that all claims related hereto
        may be heard and determined in such courts; (c) waives the defense of an
        inconvenient forum; (d) agrees that
        a final
        judgment of such courts shall be conclusive and may be enforced in another
        jurisdiction by suit on the judgment or in any other manner provided by law;
        and
        (e) waives any immunity (sovereign or otherwise) from jurisdiction of any
        court
        or from any legal process that it or its properties or assets has or may
        acquire.

     

      Except
        as
        amended hereby, the terms and provisions of the Agreement shall remain in
        full
        force and effect, and the Agreement is in all respects ratified and confirmed.
        On and after the date of this agreement, each reference in the Agreement
        to the "Agreement", "hereinafter", "herein", "hereunder", "hereof", or words
        of
        like import shall mean and be
        a
        reference to the Agreement as amended by this agreement.

     

      This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed an original and all of which taken together shall constitute a single
        Amendment.

     

      The
        Agreement may be deemed as executed upon receipt of email affirmation, to
        be
        followed by execution of physically
        signed
        documents within five (5) business days.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

        
          
             

             

          

        

      

    

     

      IN
        WITNESS WHEREOF, the
        parties hereto have executed this agreement as of the date first stated
        above.“JONES”

     

      
        	 	 	 	 
	/s/ Gary
                Jones 	 	 	 
	
                

                Gary
                  Jones 

              	 	 	 
	 	 	 	 

     

    “COMPANY”
      eMagin Corporation

     

     

      
        	 	 	 	 
	/s/ Thomas
                Paulsen 	 	 	 
	
                
Thomas
                Paulsen 	 	 	 
	
                Chairman
                  of the Board and Chairman of the Compensation Committee

              	 	 	 

      

     

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

        
          
             

             

          

        

      

    

     

      SCHEDULE
        A

     

      Approved
        expense items include the following

     

      Domestic
        Travel:

     

      Airfare
        at up to equivalent of full fare coach or special Y-up first class ticket
        pricing.

      Other
        public transportation and stowage

      Bellman,
        porter, doorman, and valet tips or cart rentals at airport as
        needed.

      Available
        hotels closest to meeting location at best available rate. Other hotel expenses
        including industry standard tips, laundry, Internet, and business center
        services.

      Meals
        at
        per diem rates of Major US cities: Up to $90/day, Small-medium US cities
        $60/day, Hopewell Junction $50/day per person without receipts. Direct charges
        will be made for business meeting meals or higher than usual cost meals (e.g.,
        room service or limited alternative for some good reason) above the per diem
        rates

      Internet-business
        center and shipping services

      Transportation:
        Taxis, hired transportation, or parking fees and mileage reimbursement to
        and
        from home or office to airports and
        while on
        travel. Rental of 4 door full size rental car with navigation rental
        rate.

      Other
        reasonable expenses

      Conference
        or symposium fees

     

      Foreign
        Travel

     

      Approved
        expenses would be similar to domestic travel, except with the following
        additions.

      Business
        Class or discounted First Class Special Program airfares for long hauls (e.g.,
        AA RTW or Asia Pacific fares)

      Standard
        per Diem of $80/day for meals. Other meal expenses similar to large US City
        rates (Expensive cities such as Paris, Tokyo, London, etc.. ~$100/day meal
        allowance without receipts)

      Parking

     

      General
        Expenses and Home Office Support

     

      Cell
        phones ( 2: T mobile 4 band + Verizon) + Replacements and supplies as
        needed
        AOL
        account, Internet support, business line service at home

      Security
        system support (ADT security fees) while supporting the Company
        Software
        upgrades and renewals

      Special
        software or hardware for defined requirements such as product
        demonstrations
        Printer
        ink and office supplies

      Credit
        card fees and services for credit cards used principally for the
        business

      Other
        charges made principally for business purposes based on historical
        procedures

     

     

     

     

     

    5<PAGE>

                                                                    EXHIBIT 4.16

December 3, 2006

uWink, Inc.
Attention: Chief Financial Officer

Dear Peter:

         Pursuant to Section 7.5 of the Securities Purchase Agreement (the
"Agreement") entered into as of March 3, 2006 among uWink, Inc. (the "Company")
and the purchasers executing the Agreement, the undersigned unconditionally and
irrevocably waives: (1) Any requirement in Article VI of the Agreement related
to registration of the Warrants; (2) Any requirement in the Agreement of the
Company to make Event Payments, including without limitation, an Event Payment
if the Registration Statement is not declared effective by the Required
Effectiveness Date set forth in Section 6.1(d)(i) of the Agreement; and (3) All
piggyback registration rights set forth in Section 6.7 of the Agreement which
otherwise would require the Company to include in any future Registration
Statement all or any part of Registrable Securities any purchaser requests to be
registered.

           Any undefined capitalized terms in this letter shall have the
meanings assigned to them in the Agreement.

Very truly yours,

By______________________________________
Name:
Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]