Distribution Agreement

Exhibit 10.4

DISTRIBUTION AGREEMENT

This Distribution Agreement (the “Agreement”), effective as of the date of January 26, 2020 (the “Effective Date”), by and between Quantum Materials Corp., a Nevada corporation (“QMC”), and Pasaca Capital Inc., a Nevada corporation (“Pasaca”). Both QMC and Pasaca may be referred to individually as a “Party” and collectively as the “Parties.”

WHEREAS QMC produces quantum dots and nanoparticles that can be applied in a variety of applications across multiple industries (the “Quantum Dots”). QMC employs quantum dots in products and services that it offers in the marketplace and as components of products developed and distributed by QMC customers.

WHEREAS QMC HealthID Incorporated, a Nevada corporation, is a wholly owned subsidiary of QMC, and provides QMC™ HealthID, an application-based platform that allows individuals to share their health status (the “QMC™ HealthID IP”).

WHEREAS Pasaca and its affiliates desire to resell, distribute and act as a sales representative for Quantum Dots and the QMC™ HealthID IP.

WHEREAS QMC desires to grant to Pasaca and its affiliates the authority to resell, distribute and act as a sales representative for Quantum Dots and the QMC™ HealthID IP.

NOW, THEREFORE, in consideration of the mutual promises in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are acknowledged by the Parties, the Parties agree as follows:

(a) QMC shall maintain an account (the “Revenue Account”) that shall be increased by the amount of revenue actually received from Qualifying Sales (net of refunds and applicable credits from returns). The Revenue Account shall be provided to Pasaca at least monthly and shall be subject to audit at Pasaca’s request.

(b) “Qualifying Sales” means sales activities of Pasaca or Designees of Quantum Dots or relating to the QMC™ HealthID IP and shall include and sales to third-party customers, Pasaca or Designees. As used herein, “sales” includes all methods of commercialization, including but not limited to royalties, licenses and product sales. For avoidance of doubt, the Parties agree that the current contemplated transactions, including those with Nuffield, are Qualifying Sales and the revenues associated therewith or arising therefrom will apply in meeting the Minimum Revenues.

(a) All sales solicited by Pasaca or Designees are subject to approval, rejection or modification by QMC. Pasaca and Designees shall have no authority to enter into any agreement on behalf of QMC or to otherwise bind QMC to sell or deliver any Quantum Dots and QMC™ HealthID IP. Pasaca and Designees shall promptly notify QMC with respect to all sales prospects, including forwarding to QMC all orders, requests for quotation and sales inquiries.

(b) QMC reserves the right, in good faith, to:

(i) accept, or decline to accept, any order received from any party whether or not solicited by Pasaca or Designees;

(ii) cancel, terminate, or modify any order previously accepted by QMC; or

(iii) negotiate any terms and conditions of any order, including modifying the purchase price or payment terms.

(a) market, advertise, promote, and solicit the sale of Quantum Dots and the QMC™ HealthID IP with good business practice, in each case using its best efforts to maximize sales volume;

(b) initiate and attend sales calls and meetings with prospective and existing customers;

(c) develop and execute a sales and marketing plan sufficient to fulfill its obligations under this Agreement;

(d) observe all directions and instructions given to it by QMC in relation to the marketing, advertisement, and promotion of Quantum Dots and the QMC™ HealthID IP;

(e) market, advertise, promote and solicit the sale of Quantum Dots and the QMC™ HealthID IP and conduct business in a manner that reflects favorably at all times on the good name, goodwill, and reputation of QMC;

(f) promptly notify QMC of any complaint or adverse claim about any product or its use; and

(g) provide, upon QMC’s request, assistance to QMC to collect payment from customers of amounts due.

(a) make any representations, warranties, guarantees, indemnities, similar claims, or other commitments: (i) actually, apparently, or ostensibly on behalf of QMC, or (ii) to any party with respect to Quantum Dots or the QMC™ HealthID IP, which representations, warranties, guarantees, indemnities, similar claims, or other commitments are additional to or inconsistent with any then-existing representations, warranties, guarantees, indemnities, similar claims, or other commitments in this Agreement or any written documentation provided by QMC;

(b) engage in any unfair, anti-competitive, misleading, or deceptive practices respecting Quantum Dots or the QMC™ HealthID IP, including any product disparagement; or

(c) sell, market, advertise, promote, solicit the sale of, or offer to sell any goods that compete with the products of Supplier, except to the extent this restriction is prohibited by applicable Law.

(a) any and all QMC intellectual property rights are the sole and exclusive property of QMC;

(b) any and all Pasaca or Designee intellectual property rights are the sole and exclusive property of Pasaca or such Designee, as applicable;

(c) Pasaca and Designees shall not acquire any ownership interest in any QMC intellectual property right under this Agreement;

(d) QMC shall not acquire any ownership interest in any Pasaca or Designee intellectual property right under this Agreement;

(e) any goodwill derived from the use by Pasaca and Designees of QMC intellectual property inures to the benefit of QMC;

(f) any goodwill derived from the use by QMC of Pasaca or Designee intellectual property inures to the benefit of Pasaca or such Designee, as applicable;

(g) if Pasaca or Designees acquires any intellectual property rights in or relating to Quantum Dots or the QMC™ HealthID IP (including any rights in any trademarks, derivative works or patent improvements relating thereto), by operation of law, or otherwise, such rights are deemed and are hereby irrevocably assigned to QMC without further action by either of the Parties;

(h) if QMC acquires any intellectual property rights in or relating to Pasaca or Designee intellectual property (including any rights in any trademarks, derivative works or patent improvements relating thereto), by operation of law, or otherwise, such rights are deemed and are hereby irrevocably assigned to Pasaca or such Designee, as applicable, without further action by either of the Parties;

(i) Pasaca and Designees shall use QMC intellectual property rights solely for the purposes of performing its obligations under this Agreement and only in accordance with this Agreement and the instructions of QMC; and

(j) QMC shall use Pasaca and Designees intellectual property rights solely for the purposes of performing its obligations under this Agreement and only in accordance with this Agreement and the instructions of Pasaca and Designees.

(a) take any action that may interfere with any of QMC’s rights in or to QMC’s intellectual property rights, including QMC’s ownership or exercise thereof;

(b) challenge any right, title, or interest of QMC in or to QMC’s intellectual property rights;

(c) make any claim or take any action adverse to QMC’s ownership of QMC’s intellectual property rights;

(d) register or apply for registrations, anywhere in the world, for QMC’s trademarks or any other trademark that is similar to QMC’s trademarks;

(e) engage in any action that tends to disparage, dilute the value of, or reflect negatively on Quantum Dots or the QMC™ HealthID IP; and

(f) alter, obscure, or remove any of QMC’s trademarks or trademark or copyright notices or any other proprietary rights notices placed on Quantum Dots and QMC™ HealthID, marketing materials, or other materials that QMC may provide.

QMC reciprocally agrees to the foregoing with respect to Pasaca and Designee intellectual property.

(a) The term of this Agreement commences on the Effective Date and continues for a period of five years, unless and until terminated as provided under this Agreement (the “Initial Term”).

(b) Upon expiration of the Initial Term, this Agreement automatically renews for additional successive five (5) year terms unless and until either Party provides written notice of nonrenewal at least 90 days prior to the end of the then-current term (each a “Renewal Term” and together with the Initial Term, the “Term”), or unless and until sooner terminated as provided under this Agreement. If the Term is renewed for any Renewal Term(s) pursuant to this Section 13(b), the terms and conditions of this Agreement during each such Renewal Term are the same as the terms in effect immediately prior to such renewal. In the event either Party provides timely notice of its intent not to renew this Agreement, then, unless earlier terminated in accordance with its terms, this Agreement terminates on the expiration of the Initial Term or then-current Renewal Term, as applicable.

(c) QMC may terminate this Agreement by providing written notice to Pasaca or a Designee, as applicable:

(i) if Pasaca or such Designee breaches any provision of this Agreement, and either the breach cannot be cured or, if the breach can be cured, it is not cured by Pasaca or such Designee within 30 days after Pasaca or such Designee’s receipt of written notice of such breach;

(ii) if Pasaca or such Designee becomes insolvent or files, or has filed against it, a petition for voluntary or involuntary bankruptcy or pursuant to any other insolvency law, makes or seeks to make a general assignment for the benefit of its creditors or applies for, or consents to, the appointment of a trustee, receiver, or custodian for a substantial part of its property, or is generally unable to pay its debts as they become due; or

(iii) if Pasaca or such Designee sells, transfers or disposes of all or substantially all of its assets, or merges or consolidates with any other entity.

(d) Pasaca may terminate this Agreement by providing written notice to QMC:

(iv) if QMC breaches any provision of this Agreement, and either the breach cannot be cured or, if the breach can be cured, it is not cured by QMC within 30 days after QMC’s receipt of written notice of such breach;

(v) if QMC becomes insolvent or files, or has filed against it, a petition for voluntary or involuntary bankruptcy or pursuant to any other insolvency law, makes or seeks to make a general assignment for the benefit of its creditors or applies for, or consents to, the appointment of a trustee, receiver, or custodian for a substantial part of its property, or is generally unable to pay its debts as they become due; or

(vi) if QMC sells, transfers or disposes of all or substantially all of its assets, or merges or consolidates with any other entity.

(e) Any termination under Section 13(c) or (d) will be effective on the respective Party’s receipt of notice of termination or such later date (if any) set forth in such notice.

(f) Upon the expiration or earlier termination of this Agreement, each respective Party shall promptly:

(vii) cease to represent itself as the other Party’s authorized representative with respect, and shall otherwise desist from all conduct or representations that might lead the public to believe that such Party is authorized by the other Party to market, promote or solicit sales of the other Party’s products or services;

(viii) destroy all documents and tangible materials (and any copies) containing, reflecting, incorporating, or based on the other Party’s Confidential Information; and

(ix) permanently erase all of the other Party’s Confidential Information from its computer systems.

IN WITNESS WHEREOF, the Parties hereto have executed this Distribution Agreement as of the date first written above.