NOVINT TECHNOLOGIES INC (Form: 10QSB, Received: 05/22/2006 14:39:51)

United States SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB


þ		QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2006


o		TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File No. 000-51783

NOVINT TECHNOLOGIES, INC.

(Name of Small Business Issuer in its Charter)


Delaware		85-0461778

(State of Incorporation)		(IRS Employer ID. No.)

9620 San Mateo Boulevard NE, Albuquerque, NM		87113

(Address of Principal Executive Offices)		(Zip Code)

Issuer’s telephone number, including area code : (866) 298-4420

Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

State the number of shares outstanding of each of the issuer’s classes of common equity as of the latest practicable date: As of May 19, 2006 there were 17,336,845 shares of common stock outstanding and no other outstanding classes of a common equity security.

TABLE OF CONTENTS


PART 1 — FINANCIAL INFORMATION
	Item 1. Financial Statements
	Item 2. Management’s Discussion and Analysis or Plan of Operation
PART II — OTHER INFORMATION
	Item 1. Legal Proceedings
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
	Item 6. Exhibits
	ITEM 13. EXHIBITS
SIGNATURES
Exhibit 4.2
Exhibit 10.39
Exhibit 31
Exhibit 32

Novint Technologies, Inc.

BALANCE SHEET


	March 31, 2006
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	61,054
Prepaid expenses and other current assets		7,753
Accounts receivable, net		7,662
Costs and estimated earnings in excess of billings on contracts		23,874

Total current assets		100,343


PROPERTY AND EQUIPMENT:
Office equipment		48,841
Software		7,246
Computer equipment		209,630

		265,717

Less: Accumulated depreciation		226,439

Net property and equipment		39,278


INTANGIBLE ASSETS, NET		148,650


Total assets	$	288,271

The accompanying notes are an integral part of these financial statements.

Novint Technologies, Inc.

BALANCE SHEET
(Continued)


	March 31, 2006
	(Unaudited)
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	71,728
Accrued payroll related liabilities		98,583
Accrued royalties		37,500
Accrued interest		22,247
Accrued research and development liabilities		189,646
Accrued expenses, related party		25,000
Other accrued liabilities		144,645
Billings in excess of costs and estimated earnings		6,185
Convertible Notes payable		481,303
Note payable		200,000

Total current liabilities		1,276,837


COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ EQUITY (DEFICIT):
Preferred stock, Series A: $0.01 par value; authorized 4,000 shares, 0 issued and outstanding		—
Common stock, authorized 50,000,000 shares, $0.01 par value; 16,836,845 issued and outstanding		168,368
Additional paid-in capital		7,816,614
Accumulated deficit		(8,968,943	)
Accumulated other comprehensive loss		(4,605	)

Total stockholders’ equity (deficit)		(988,566	)


Total liabilities and stockholders’ equity (deficit)	$	288,271

The accompanying notes are an integral part of these financial statements.

Novint Technologies, Inc.

STATEMENTS OF OPERATIONS


	For the			For the
	Three Months			Three Months
	Ended			Ended
	March 31, 2006			March 31, 2005
	(Unaudited)			(Unaudited)
Revenue
Project	$	36,856		$	87,281
Product		1,925			27,930

Total revenue		38,781			115,211

Cost of goods sold:
Project		25,679			39,758
Product		—			19,653

Total cost of goods sold		25,679			59,411

Gross margin		13,102			55,800


Costs and expenses
Research and development		89,840			411,175
General and administrative		469,027			513,053
Depreciation and amortization		24,697			29,943
Sales and marketing		26,348			54,258

Total costs and expenses		609,912			1,008,429


Loss from operations		(596,810	)		(952,629	)


Other expense
Interest expense		32,927			58


Total other expenses		32,927			58


Net loss		(629,737	)		(952,687	)

Preferred stock accretion		(170,974	)		(7,090	)


Net loss available to common stockholders	$	(800,711	)	$	(959,777	)


Loss per share, basic and diluted:
Net loss	$	(0.04	)	$	(0.07	)

Net loss available to common stockholders	$	(0.05	)	$	(0.07	)


Weighted-average common shares outstanding, basic and diluted		15,161,091			13,287,544

The accompanying notes are an integral part of these financial statements.

Novint Technologies, Inc.

STATEMENT OF CASH FLOWS


	For the
	Three Months Ended
	March 31, 2006			March 31, 2005
	(Unaudited)			(Unaudited)
Cash flows from operating activities:
Net loss	$	(629,737	)	$	(952,687	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		24,697			29,943
Common stock issued for services		8,500			60,000
Options issued to employees for services		74,804			13,951
Options issued to consultants for services		13,447			—
Amortization of unearned compensation		—			50,377
Reserve for contract loss		—			(3,156	)
Changes in operating assets and liabilities:
Accounts receivable		67,478			(780	)
Prepaid expenses		400			3,750
Deferred financing costs		4,032			—
Accounts payable		989			(196,699	)
Accrued liabilities		153,163			367,880
Accrued interest		28,307			—
Accrued royalties		7,500			7,500
Costs and estimated earnings in excess of billings on contracts, net		(23,874	)		(50,105	)
Billings in excess of costs and estimated earnings on contracts, net		(6,485	)		(34,020	)

Net cash used by operating activities		(276,779	)		(704,046	)


Cash flows from investing activities:
Property and equipment acquisitions		(4,294	)		(3,354	)

Net cash provided (used) by investing activities		(4,294	)		(3,354	)


Cash flows from financing activities:
Proceeds from notes payable		300,000			—

Net cash provided by financing activities		300,000			—


Net increase (decrease) in cash and cash equivalents		18,927			(707,400	)

Cash and cash equivalents at beginning of period		42,127			1,329,428


Cash and cash equivalents at end of period	$	61,054		$	622,028


Supplemental information:
Non-cash: Issuance of common stock in payment of accrued research and development liabilities	$	465,000		$	—

Non-cash: Issuance of common stock in payment of note payable and accrued interest	$	860,624		$	—

Research and Development paid with Note Payable	$	—		$	123,222

Fair value accretion on conditionally redeemable, convertible preferred stock	$	170,974		$	7,090

The accompanying notes are an integral part of these financial statements.

PART 1 — FINANCIAL INFORMATION

Item 1. Financial Statements.

Novint Technologies, Inc.

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006 AND 2005 (Unaudited)

NOTE 1 — BASIS OF PRESENTATION AND NATURE OF BUSINESS

Basis of Presentation

The unaudited consolidated financial statements have been prepared by Novint Technologies, Inc. (the “Company”or “Novint”), in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-QSB and Regulation S-B as promulgated by the Securities and Exchange Commission (“SEC”). Accordingly, these consolidated financial statements do not include all of the disclosures required by generally accepted accounting principles in the United States of America for complete financial statements. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto include on Form 10-KSB for the period ended December 31, 2005. In the opinion of management, the unaudited interim consolidated financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim period presented. The results of the three months ended March 31, 2006 are not necessarily indicative of the results to be expected for the full year ending December 31, 2006.

Nature of Business

Novint was originally incorporated in the State of New Mexico in April 1999. On February 26, 2002, the Company changed its state of incorporation to Delaware by merging with Novint Technologies, Inc., a Delaware corporation. This merger was accounted for as a reorganization of the Company. The Company currently is engaged in the development and sale of haptics products and equipment, including installation services and support, to production and manufacturing companies in the United States. e-Touch™ is a software program designed to utilize haptics (the sense of touch) equipment, using sight and sound to enable 3D interaction for the user of a computer. The Company’s efforts primarily are concentrated on the development and marketing of e-Touch™ applications. The Company plans to expand into the consumer interactive computer gaming market, which is a substantial departure from its current business of offering product development services and limited sales of haptic technology. The Company’s operations are based in New Mexico with sales primarily to private entities and quasi-governmental agencies in the United States.

Going Concern and Managements Plans

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern. The Company has experienced recurring losses and operated with negative working capital and, as a result, there exists substantial doubt about its ability to continue as a going concern.

Since inception, the Company has incurred net operating losses and other equity charges, which have resulted in an accumulated deficit of $8,968,943 at March 31, 2006. For the three months ended March 31, 2006 and March 31, 2005, the Company had net losses of $629,737 and $952,687, respectively. Since inception, management has raised equity totaling approximately $5.7 million through various private equity transactions and had approximately $61,000 in cash on hand at March 31, 2006.

NOTE 1 — BASIS OF PRESENTATION AND NATURE OF BUSINESS (Continued)

and if such offering is conducted at a price per share of Common Stock of $1.11 per share or less, then, the Purchase Price Per Share of Common Stock shall be automatically adjusted to equal 90% of the issue price.

If the Company is successful in developing its gaming technology and video games business, and in developing partnerships with game publishers and hardware manufacturers, it will need to raise another $15 million in funding to execute its current business plan with respect to its video gaming business. There can be no assurances that the Company will be able to obtain any additional funding on favorable terms, if at all. Borrowing money may involve pledging some or all of the Company’s assets. Raising additional funds by issuing common stock or other types of equity securities would further dilute the existing shareholders.

Without additional equity infusion or long-term borrowings, there is substantial doubt of the Company’s ability to continue as a going concern. Management believes it will need additional funding to supplement its cash on hand along with revenues from project and product sales to allow the Company to satisfy its short-term obligations and provide enough cash flow for the Company to continue operations. Management has the ability to curtail spending and negotiate or push back payments to third parties or settle such expenditures in stock in the event it experiences cash shortfalls or in the event the next round of funding does not occur or takes significantly longer than anticipated. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These factors raise substantial doubt about our ability to continue as a going concern.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Software Development Costs

The Company accounts for its software development costs in accordance with Statement of Financial Accounting Standards (SFAS) Number 86, Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed. This statement requires that, once technological feasibility of a developing product has been established, all subsequent costs incurred in developing that product to a commercially acceptable level be capitalized and amortized ratably over the estimated life of the product, which is generally 5 years. The Company has capitalized software development costs in connection with e-touch™ beginning in 2000. Amortization is computed on the straight-line basis over the remaining life (5 years) of the e-touch™ platform. As of March 31, 2006 the Company’s capitalized software was fully amortized. The Company has determined that research and development software related costs incurred during 2005 are not capitalizable as the technological feasibility of such products has not yet been established. Accordingly, such costs have been expensed as research and development expenses in the period incurred.

Property and Equipment

Property and equipment are stated at cost. Depreciation on property and equipment is calculated on a straight-line depreciation method over the estimated useful lives of the assets, which range from 3 to 5 years for software and computer equipment, and 5 years for office equipment. Repairs and maintenance costs are expensed as incurred. The Company follows Statement of Position (SOP) No. 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use, which requires capitalization of certain costs incurred during the development of internal use software. Through March 31, 2006, capitalizable costs incurred have not been significant for any development projects. Accordingly, the Company has charged all costs to research and development expense in the periods incurred. Depreciation expense was $6,155 and $11,401 for the three months ended March 31, 2006 and 2005, respectively.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Intangible Assets

Intangible assets, which consist of licensing agreements ($880,000) and patents ($10,734), are carried at cost less accumulated amortization. Amortization is computed using the straight-line method over the economic life of the assets, which range between 3 and 12 years. For the three months ended March 31, 2006 and 2005, the Company recognized amortization expense of approximately $18,542 and $18,542, respectively, related to intangible assets.

Annual amortization of intangible assets remaining at March 31, 2006, are as follows:


Year Ended December 31,
2006		55,626
2007		71,666
2008		2,500
2009		2,500
2010 and after		16,358

Total	$	148,650

Revenue and Cost Recognition

The Company recognizes revenue from the sale of software products under the provisions of SOP 97-2, Software Revenue Recognition, as amended by SOP 98-4 and SOP 98-9. SOP 97-2 generally requires that revenue recognized from software arrangements be allocated to each element of the arrangement based on the relative vendor specific objective evidence of fair values of the elements, such as software products, upgrades, enhancements, post contract customer support, installation or training. Under SOP 97-2, if the determination of vendor specific objective evidence of fair value for each element of the arrangement does not exist, all revenue from the arrangement is deferred until such time that evidence does exist or until all elements of the arrangement are delivered.

SOP 97-2 was amended in December 1998 by SOP 98-9, Modification of SOP 97-2 Software Revenue Recognition with Respect to Certain Transactions. SOP 98-9 clarified what constitutes vendor specific objective evidence of fair value and introduced the concept of the “residual method” for allocating revenue to elements in a multiple element arrangement.

The Company’s revenue recognition policy is as follows:

Project revenue consists of programming services provided to unrelated parties under fixed-price contracts. Revenues from fixed price programming contracts are recognized in accordance with SOP 81-1, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, and Accounting Research Bulletin (ARB) 45, Long-Term Construction-Type Contracts, using the percentage-of-completion method, measured by the percentage of costs incurred to date compared with the total estimated costs for each contract. The Company accounts for these measurements in the accompanying balance sheets under costs and estimated earnings in excess of billings on contracts and billings in excess of costs and estimated earnings on contracts. Provisions for estimated losses on uncompleted contracts are made and recorded in the period in which the loss is identified.

Revenue from product sales relates to the sale of the Phantom haptics interface, which is a human-computer user interface (the Phantom). The Phantom allows the user to experience sensory information when using a computer and its handle and is the approximate size and shape of a writing instrument. Phantoms are manufactured by an unrelated party and are shipped directly to the customer.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

rather this fee is included in the price and, therefore, part of the Company’s product revenue. No provision for sales returns has been provided in these financial statements as the Company has never had a sales return.

EITF 01-14, Income Statement Characterization of Reimbursements Received for “Out-of-Pocket” Expenses Incurred, requires reimbursements received for out-of-pocket expenses incurred while providing services to be characterized in the statements of operations as revenue. The Company’s out-of-pocket expenses incurred in connection with their project revenues are recognized in revenues based on a computed overhead rate that is included in their project labor costs to derive a project price.

In accordance with EITF 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent, the Company recognizes its product sales on a gross basis. The Company is responsible for fulfillment, including the acceptability of the product ordered. The Company has risks and rewards of ownership such as the risk of loss for collection, delivery or returns. Title passes to the customer upon receipt of the product by the customer. In accordance with the Company’s agreement with its customer, further obligation is limited to the terms defined in its warranty.

The Company’s customers are provided a warranty from the Company’s supplier. This warranty guarantees that the supplier’s products shall be free from manufacturing defects. The supplier agrees to provide, free of charge, replacements for any components found to be defective within 1 year of delivery. The Company’s customers also have the option of purchasing a Maintenance Renewal, which extends the supplier’s warranty coverage for the following year. The Company’s supplier handles all administration and actual repairs provided for under the basic and renewal programs and, therefore, the Company has not recorded a warranty accrual. To date, the Company’s customers have not purchased a Maintenance Renewal.

Loss per Common Share

Statement of Financial Accounting Standards No. 128 , Earnings Per Share , (SFAS 128) provides for the calculation of “Basic” and “Diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period. All potentially dilutive securities have been excluded from the computations since they would be antidilutive. However, these dilutive securities could potentially dilute earnings per share in the future. As of March 31, 2006 and 2005, the Company had a total of 10,251,338 and 10,226,338 in potentially dilutive securities, respectively.

Stock Option Plans

The Company adopted SFAS No. 123 (Revised 2004), Share Based Payment (“SFAS No. 123R”), under the modified-prospective transition method on January 1, 2006. SFAS No. 123R requires companies to measure and recognize the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value. Share-based compensation recognized under the modified-prospective transition method of SFAS No. 123R includes share-based compensation based on the grant-date fair value determined in accordance with the original provisions of SFAS No. 123, Accounting for Stock-Based Compensation, for all share-based payments granted prior to and not yet vested as of January 1, 2006 and share-based compensation based on the grant-date fair-value determined in accordance with SFAS No. 123R for all share-based payments granted after January 1, 2006. SFAS No. 123R eliminates the ability to account for the award of these instruments under the intrinsic value method proscribed by Accounting Principles Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees, and allowed under the original provisions of SFAS No. 123. Prior to the adoption of SFAS No. 123R, the Company accounted for their stock option plans using the intrinsic value method in accordance with the provisions of APB Opinion No. 25 and related interpretations.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Primarily as a result of adopting SFAS No. 123R, the Company recognized $74,804 in share-based compensation expense for the three months ended March 31, 2006. The impact of this share-based compensation expense on the Company’s basic and diluted earnings per share was $0.00 per share. The fair value of our stock options was estimated using the Black-Scholes option pricing model. For purposes of pro forma disclosure, the estimated fair value of the options is amortized to expense over the option’s vesting period. The following is the pro forma expense for the three months ended March 31, 2005:


	March 31,
	2005
Net loss available to common shareholders, as reported	$	(959,776	)
Add: Stock-based employee compensation expense included in reported net income		50,377
Deduct: Total stock-based employee compensation expense determined under fair value-based method for all awards		(78,575	)

Pro forma net loss available to common shareholders	$	(987,974	)

Loss available to common shareholders per share, basic and diluted:
As reported	$	(0.07	)
Pro forma	$	(0.07	)

In calculating the fair value of options for the above disclosure, the following assumptions were used for stock options issued during the three months ended March 31, 2006 and 2005: fair market value of $1.00 per share, risk-free rates ranged from 1.73% to 3.66%, volatility of the options ranged from 73% to 91%, estimated lives of 3 to 10 years and exercise prices ranged from $0.66 to $1.00 per share.

In addition, FSP FAS 123(R)-1, Classification and Measurement of Freestanding Financial Instruments Originally Issued in Exchange for Employee Services under FASB Statement No. 123(R) , provides additional guidance regarding the accounting treatment for freestanding financial instruments originally issued as employee compensation. Specifically, this instrument would be subject to the recognition and measurement provisions of SFAS 123(R) throughout the instrument’s life, provided the terms of the instrument are not modified after the rights conveyed by the instrument no longer are dependent on whether the holder is an employee.

The guidance in this FSP supersedes FSP EITF 00-19-1, Application of EITF Issue No. 00-19 to Freestanding Financial Instruments Originally Issued as Employee Compensation, and amends SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. This FSP is effective upon initial adoption of SFAS 123(R).

Research and Development

Research and development costs are expensed as incurred and amounted to $89,840 and $411,175 for the three months ended March 31, 2006 and March 31,2005, respectively. Research and development costs primarily relate to costs incurred for development of haptics interface gaming technology prior to the technological feasibility of such technology.

Recent Accounting Pronouncements

The Company has adopted all accounting pronouncements issued before March 31, 2006, which are applicable to the Company.

In May 2005, Financial Accounting Standards Board (FASB) issued SFAS 154, Accounting Changes and Error Corrections . This Statement replaces APB Opinion No. 20, Accounting Changes , and SFAS 3, Reporting Accounting Changes in Interim Financial Statements , and changes the requirements for the accounting for and reporting of a change in accounting principle. SFAS 154 differentiates between retrospective application and restatement. This Statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Early adoption is permitted for accounting changes and corrections of errors made in fiscal years beginning after the date this Statement is issued. SFAS 154 does not change the transition provisions of any existing accounting pronouncements, including those that are in a transition phase of the effective date of this Statement. The adoption of the provisions of SFAS 154 did not have an impact on its financial condition or results of operations.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In February 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 155, “Accounting for Certain Hybrid Financial Instruments — an amendment of FASB Statements No. 133 and 140” (“SFAS No. 155”). SFAS No. 155 allows financial instruments that contain an embedded derivative and that otherwise would require bifurcation to be accounted for as a whole on a fair value basis, at the holders’ election. SFAS No. 155 also clarifies and amends certain other provisions of SFAS No. 133 and SFAS No. 140. This statement is effective for all financial instruments acquired or issued in fiscal years beginning after September 15, 2006. The Company does not believe the adoption of SFAS No. 155 will have any impact on the Company’s financial position or results of operations.

In March 2006, the FASB issued SFAS No. 156, “Accounting for Servicing of Financial Assets — an amendment of FASB Statement No. 140” (“SFAS No. 156”). SFAS No. 156 provides guidance on the accounting for servicing assets and liabilities when an entity undertakes an obligation to service a financial asset by entering into a servicing contract. This statement is effective for the first fiscal year beginning after September 15, 2006. The Company does not believe the adoption of SFAS No. 156 will have any impact on the Company’s financial position or results of operations.

NOTE 3 — COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS ON CONTRACTS AND BILLINGS IN EXCESS OF COSTS AND ESTIMATED EARNINGS ON CONTRACTS

Costs and estimated earnings in excess of billings on contracts consisted of the following at:


	March 31,
	2006
Costs and estimated earnings incurred on uncompleted contracts	$	23,874
Billings on uncompleted contracts		—


Costs and estimated earnings in excess of billings on uncompleted contracts	$	23,874

Billings in excess of costs and estimated earnings on contracts consisted of the following at:


	March 31
	2006
Billings on uncompleted contracts	$	(6,497	)
Costs and estimated earnings incurred on uncompleted contracts		310


Billings in excess of costs and estimated earnings on uncompleted contracts	$	(6,187	)

NOTE 4 — INTANGIBLE ASSETS

Intangible assets consisted of the following at:


	March 31,
	2006
Licensing agreements	$	880,000
Patent		10,734
Less accumulated amortization		(742,084	)

	$	148,650

NOTE 5 — NOTES PAYABLE

During the three months ended March 31, 2006 and the year ended December 31, 2005, management executed a number of bridge loans. The first loan for $200,000 has an original due date of March 7, 2006 and a stated interest rate of 20% or $20,000 for the first six months outstanding. The note has the option to extend for one year under certain conditions with an interest rate of 12%. These conditions have been met and the due date of this note is September 8, 2006. The remaining bridge loans ranged from $15,000 to $450,000. These notes were originally due one year from the date of issuance at a stated

NOTE 5 — NOTES PAYABLE (Continued)

interest rate of 12%. During the three months ended March 31,2006, $825,000 of outstanding principal balance and $35,624 of accrued interest was settled through issuance of 1,250,002 shares of the Company’s common stock. The first loan in the amount of $200,000 is secured by the personal guaranty agreement of the Company’s President and CEO and by a pledge of up to 795,455 shares of common stock of the Company owned by him. The balance on this note is outstanding and is reflected in total in the amount of $200,000 in the accompanying balance sheet as note payable. Accrued interest in the amount of $22,247 related to this note payable is recorded in the accompanying balance sheet.

NOTE 6 – CONVERTIBLE NOTES PAYABLE

On March 22, 2005, the Company executed a convertible promissory note in the amount of $123,222 to Lunar Design for the costs incurred during January 2005 associated with contracted research and development efforts. The terms of the promissory note include payment due March 22, 2006, in part or in whole in cash during the time prior to maturity date. If the promissory note is not paid in full in cash at the promissory note’s maturity date, the Company will convert the unpaid balance of the note into shares of the Company’s common stock at the price per share equal to the last sale price of the Company’s common stock on the maturity date, or on the last business day prior to the maturity date. The Company is currently in discussions with Lunar as to repayment and conversion of the note. Additional promissory notes in the amount of $358,081 with the same terms were executed for the costs incurred during the year ended December 31, 2005. These additional notes are due throughout the year ended December 31, 2006.

NOTE 7 — COMMITMENTS AND CONTINGENCIES

From time to time, in the normal course of business, the Company is subject to routine litigation incidental to its business. Although there can be no assurances as to the ultimate disposition of any such matters, it is the opinion of management, based upon the information available at this time, that there are no matters, individually or in the aggregate, that will have a material adverse effect on the results of operations and financial condition of the Company.

In connection with a private placement closed in 2004, the Company committed to issue 304,900 warrants for an overallotment agreement with a consulting group for private placement services. The warrants will have an exercise price of $1.00 per share and will have a six-month term. The date of issue will be coincident with the date of Novint’s IPO. The Company’s registration statement was declared effective on February 6, 2006 and in conjunction with its effectiveness, the Company granted the above options.

The Company has a licensing agreement with Sandia National Laboratories (“Sandia”), which initially developed Flight, the precursor to e-TouchTM (the technology) and employed the Company’s founder. The licensing agreement provides the Company the right to utilize the technology exclusively for a period of 12 years and non-exclusively in perpetuity and places certain restrictions on its use as well as requires the Company to pay a 1.5 percent royalty fees to Sandia in connection with any income earned based upon the technology. Additionally, under the original agreement, the Company is obligated to pay to Sandia on a semi-annual basis annual minimum earned royalties of $6,000 in 2001, $14,000 in 2002, $24,000 in 2003 and $30,000 from 2004 through 2011. The agreement was amended on June 29, 2005, modifying the royalty payment terms such that the Company will pay royalties of $40,000 for 2001 and 2002, $24,000 in 2003, 30,000 shares of the Company’s Common Stock in 2004, and $30,000 for 2005. Novint had paid all cash amounts due and issued the agreed shares of common stock for its obligations through 2004 as of December 31, 2005. As of March 31, 2006 the Company had accrued $37,500 in royalty fees owed to Sandia under the royalty agreement.

The Company has an agreement with Lunar Design, a product design firm, to design and develop its haptics game controller. The current statement of work outlines the delivery of a final prototype in August 2005 as well as provides for additional projects as agreed to by the parties through 2006. The prototype was delivered in October 2005. In addition, Lunar Design will provide support for the Company’s manufacturing partner for design problems or other trade-offs encountered in creating the manufacturing prototype. Estimated project costs for the prototype will range between approximately $542,000 and $634,000 and will be billed on a time-and-materials basis. Lunar Design has agreed to accept payment in the form of cash, promissory note or Novint common stock. As of March 31, 2006 the Company had made payments to Lunar Design for incurred costs of approximately $424,000 under this agreement. At March 31, 2006, the Company has recorded accrued

NOTE 7 — COMMITMENTS AND CONTINGENCIES (Continued)

research and development liabilities in the accompanying balance sheet due to Lunar Design of $189,646 and convertible notes payable in the amount of $481,303.

Such costs have been expensed as research and development expenses.

On January 5, 2004, the Company entered into an exclusive Intellectual Property License Agreement (Agreement) with Force Dimension, a company in the haptics hardware technologies and products field. The Agreement provides the Company with a sublicense to a hardware patent and an assignment of a pending patent from Force Dimension. The Agreement, in turn, provides Force Dimension a security interest and a general lien in the assigned patent as well as an irrevocable, exclusive license in the patent that has been assigned to the Company. On May 10, 2005, the Company amended its contract with Force Dimension, Inc. to provide for: a license fee in the amount of $15,000 due on the effective date; the payment of a milestone payment in the amount of $50,000 within ten days of the contract amendment’s effective date; a license fee in the amount of $50,000 within 30 days of the Company’s IPO; and a support and license fee in the amount of $455,000 due no later than January 5, 2006, for all technical and support services rendered to the Company during such time period for total payments of $620,000.

In addition, the Company was to issue 250,000 shares of the Company’s common stock within 30 days of the contract amendment’s effective date as consideration for extending the payment terms of the agreement. These shares of stock were issued to Force Dimension on May 12, 2005, and have been accounted for as a financing cost related to a modification of Novint’s payment terms. The fair value of the stock issued is $250,000 and is reflected as interest expense in the amount of $245,968 for the year ended December 31, 2005, and as a deferred financing cost in the amount of $4,032 in the balance sheet at December 31, 2005. The deferred financing cost were amortized to interest expense by January 5, 2006, the maturity date of this obligation to Force Dimension.

During the year ended December 31, 2004, the Company paid $15,000 to Force Dimensions for the license fee in the amount of $15,000 due on the effective date. During 2005, Novint paid $140,000 to Force Dimension, representing a portion of the $50,000 milestone payment originally due to Force Dimension upon or before Novint’s receipt of the Second Deliverable as described in the original agreement, the $50,000 milestone payment due on the amendment’s effective date, and $50,000 representing a portion of the licensing fees due. The Second Deliverable was received by Novint on December 30, 2004. The remaining amount of $465,000 due to Force Dimensions is recorded as accrued research and development liabilities on the accompanying balance sheet as of December 31, 2005.

On March 9, 2006 the Company issued 607,500 shares of its common stock to Force Dimensions in full satisfaction of the remaining $465,000 owed as of December 31, 2005.

The Agreement requires Novint to pay up to $15 million to Force Dimension, including the amounts above, on a per unit of Licensed Product basis for license fees, royalties and a percentage of product sales after the product becomes technologically feasible. In addition, Novint is entitled to 5% license fees/royalties for any licensed products sold related to the sublicense granted to Force Dimension by Novint. Novint has not recorded any fees related to such arrangement. This Agreement shall terminate upon Novint’s payment in total of $15,000,000 to Force Dimension and payment in full of any other obligations arising pursuant to the terms and conditions of this Agreement.

NOTE 8 — STOCKHOLDERS’ EQUITY

Conditionally Redeemable, Convertible Preferred Stock

On April 20, 2000, in connection with the license agreement with Sandia, the Company issued all 4,000 authorized shares of Series A conditionally redeemable, convertible preferred stock at $0.25 per share. The preferred stock was convertible into fully paid and non-assessable common stock as follows: at the holder’s option based on the conversion price in effect on the conversion date or automatically upon the closing of an IPO, which would result in 447,300 shares of common stock. The conversion price shall be (i) the subscription price ($100,000 when expressed as an aggregate amount or $25.00 per share when expressed on a per-share basis) divided by (ii) the conversion price in effect on the conversion date. Additionally, the Company is obligated to redeem the preferred shares, if there is no IPO or initial sale within 10 years from the issue date.

NOTE 8 — STOCKHOLDERS’ EQUITY (Continued)

In connection with the effectiveness of the Company’s registration statement, on February, 6 2006 the Company issued 447,300 shares of common stock to Sandia for the conversion of the preferred stock in accordance with the agreement.

Accordingly, the Company accreted the fair value of the common stock conversion to retained earnings through the conversion date of February 6, 2006. When the Company was approved for public filing, it recognized an additional charge of $170,974 to retained earnings of the converted shares at the fair value as compared to the IPO price. The fair value of the stock at March 31, 2006 was estimated to be $1.00 per share.

Stock Options

In March 2004, the Board of Directors approved the adoption of the 2004 Stock Incentive Plan. A total of 3,500,000 shares of common stock have been reserved for issuance under this plan. The Company has issued options to purchase shares of common stock to employees and various consultants for payment of services.

Option activity during the three months ended March 31, 2006 and the year ended December 31, 2005, is summarized in the following table:


	Shares				Weighted-
	Under		Price per		Average
	Option		Share		Exercise Price
Options outstanding at 12/31/05		8,003,341	$	0.01-$0.66	$	0.26
Granted		554,900	$	1.00	$	1.00
Exercised		—		—	$	—
Canceled		—		—	$	—

Options outstanding at 3/31/06		8,558,241	$	0.01-$0.66	$	0.26

Exercisable at 3/31/06		6,304,241	$	0.01-$1.00	$	0.18

The following summarizes certain information regarding outstanding options March 31, 2006:


		Outstanding						Exercisable
						Weighted
						Average
				Weighted-		Remaining				Weighted
				Average		Contractual				Average
*Exercise Price*		Number		Exercise Price		Life (years)		Number		Exercise Price
	$0.01		338,416	$	0.01		2.30		338,416	$	0.01
	$0.05		4,600,000	$	0.05		6.46		4,600,000	$	0.05
	$0.50		1,261,364	$	0.50		8.13		261,364	$	0.50
	$0.66		1,886,894	$	0.66		8.45		522,894	$	0.66

	$1.00		554,900	$	1.00		4.73		304,900	$	1.00

Total			8,558,241	$	0.31		6.92		6,304,241	$	0.18

NOTE 9 — EQUITY TRANSACTIONS

On April 1, 2004, the Company committed to issue 250,000 shares of common stock at $1.00 per share to a consultant for future services. The consultant will receive stock as follows: 50,000 shares per quarter as long as the consultant is still providing services to he Company, up to a total of 250,000 shares, beginning April 1, 2004. As of March 31, 2005, 200,000

NOTE 9 — EQUITY TRANSACTIONS (Continued)

of the shares had been issued and the remaining 50,000 shares were issued during the second quarter of 2005. The Company has recognized $50,000 in consulting expense related to this issuance during the three months ended March 31, 2005.

In March 2005, the Company issued 2,500 shares of common stock to an advisory board member for services performed. The stock was valued at $0.66 per share for total consideration of $1,650. Consulting expense of $1,650 was recorded in the Company’s operations during the three months ended March 31, 2005.

During 2005 the Company issued 45,000 shares of common stock for legal services to be provided. The value of the share issued was $29,700 the value of the services to be performed. This amount was recorded as a prepaid expense and is being amortized as expenses are incurred. As of March 31, 2006 the Company has amortized $23,521 of this amount as legal expense.

The Company also issued 10,000 shares of common stock to an employee for services rendered during the second quarter of 2005. The fair value of the services was $10,000 and is included in common stock at December 31, 2005, and recorded as compensation expense during the three months ended March 31, 2005.

In March 2006, the Company issued 200,329 shares of common stock to the original private placement investors as compensation for delays in obtaining approval for public filing.

The Company issued 6,000 shares of common stock to a consultant for services rendered during the first quarter of 2006. The fair value of the services was $6,000 and is included in common stock at March 31, 2006, and recorded as consulting expense for the three months ended March 31, 2006.

In March 2006, the Company issued 2,500 shares of common stock to an advisory board member for services performed. The stock was valued at $1.00 per share for total consideration of $2,500. Consulting expense of $2,500 was recorded in the Company’s operations for the three months ended March 31, 2006.

NOTE 10 —WARRANTS

A summary of the status of the total number of warrants as of March 31, 2006 and December 31, 2005, , and changes during the periods then ended is presented in the tables below:


	March 31, 2006
	Shares			Wtd Avg Ex Price
Outstanding at beginning of year		3,442,900		$	1.29
Granted		—
Exercised		—			1.00
Forfeited		(—	)		—
Outstanding at end of year		3,442,900			1.31

Exercisable at end of year		2,888,000			1.30

Weighted average fair value of warrants granted	$	1.84		$

NOTE 10 —WARRANTS (Continued)

A summary of outstanding warrants as of March 31, 2006, the range of exercise prices, the weighted-average exercise price, the weighted-average remaining contractual life, the amount of warrants currently exercisable and the weighted-average exercise price of warrants currently exercisable is as follows:


	Warrants Outstanding						Warrants Exercisable
			Weighted-
			Average		Weighted-				Weighted-
	Number		Remaining		Average		Number		Average
Range of	Outstanding at		Contractual		Exercise		Exercisable		Exercise
Exercise Prices	3/31/06		Life		Price		at 3/31/06		Price
$0.00 to $0.25		550,000	7.50 years		$	0.25		550,000	$	0.25
$0.26 to $0.50		250,000		7.60		0.50		250,000		0.50
$0.51 to $1.00		1,118,400		4.68		1.00		563,500		1.00
$1.01 to $2.00		1,524,500		2.88		2.00		1,524,500		2.00

$0.25 to $2.00		3,442,900						2,888,000

NOTE 11 — RELATED PARTIES

On February 18, 2004, the Company granted to a significant shareholder for future services 125,000 options to purchase common stock at an exercise price of $0.66 per share. The options have a 5-year annual vesting provision. Options granted to consultants are valued each reporting period to determine the amount to be recorded as consultant expense in the respective period. As the options vest, they will be valued one last time on the vesting date and an adjustment will be recorded for the difference between the value already recorded and the current value on date of vesting. At March 31, 2006, the Company calculated the value of the options using the Black-Scholes model based on the following assumptions: a risk-free rate of 4.86%, volatility of 36%, estimated life of 10 years and a fair market value of $1.00 per share. At March 31, 2004, the Company calculated the initial value of the options using the Black-Scholes model based on the following assumptions: a risk-free rate of 4.05%, volatility of 91%, estimated life of 10 years and a fair market value of $1.00 per share. The vesting schedule is prorated over the reporting period, and approximately $3,413 and $4,437, respectively, was recorded as consultant expense during the three months ended March 31, 2006 and 2005.

In March 2004, Normandie New Mexico Corporation, which is owned by Manhattan’s Chief Executive Officer (CEO), who is also a member of the Company’s Board of Directors, entered into an agreement with the Company to provide consulting services in relation to business development and marketing support. Fees per the agreement are $6,250 per month. For the three months ended March 31, 2006 and 2005, the Company had paid $0 and $18,750, respectively, for these services. As of March 31, 2006, the Company owed $25,000 to Normandie New Mexico under the agreement.

On June 10, 2004, the Company granted 250,000 options to purchase common stock to Manhattan’s CEO for future consulting services at an exercise price of $0.66 per share. The options have a 5-year annual vesting provision. the Company calculated the value of these options using the Black-Scholes model based on the following assumptions: a risk-free rate of 4.81%, volatility of 100%, estimated life of 10 years and a fair market value of $1.00 per share. The vesting schedule is prorated over the reporting period, and approximately $7,800 and $10,000, respectively, was recorded as consultant expense during the three months ended March 31, 2006 and 2005.

On November 30, 2004, the Company established an Advisory Board who will provide assistance and consultation to the Company management on matters for which the Advisory Board members possess special knowledge, expertise and experience. the Company will appoint up to 10 Advisory Board members who shall receive either 10,000 shares of he Company stock or 10,000 options to purchase the Company stock at the Advisory Board member’s preference. As of March 31, 2006 20,000 options and 15,000 common shares were issued to these Advisory Board members.

NOTE 11 — RELATED PARTIES (Continued)

On March 9, 2006 the Company granted 250,000 options to purchase common stock to an employee, who is the brother of the Company’s Chief Executive Officer, at an exercise price of $1.00 per share. The options have a ten year term, and a vesting schedule of 50,000 shares per year beginning March 9, 2007. At March 31, 2006, the Company calculated the initial value of the options using the Black-Scholes model based on the following assumptions: a risk-free rate of 4.86%, volatility of 36%, estimated life of 10 years and a fair market value of $1.00 per share. The value of $142,400 will be amortized using the straight line method over the vesting period of 5 years. $1,860 was recorded as consultant expense during the three months ended March 31, 2006.

NOTE 12 — SUBSEQUENT DISCLOSURE

In April 2006, the Company sold 500,000 shares of common stock and 250,000 warrants to purchase common stock to an unrelated party for $500,000. The warrants have an exercise price per share of $2.00. The purchase price of the Common Stock is subject to adjustment as follows: In the event, that after the date of the agreement, the Company shall complete an offering of securities on or before April 1, 2007 which results in gross proceeds to the Company of not less than $3,000,000, and if such offering is conducted at a price per share of Common Stock of $1.11 per share or less, then, the Purchase Price Per Share of Common Stock shall be automatically adjusted to equal 90% of the issue price.

Item 2. Management’s Discussion and Analysis or Plan of Operation.

Note Regarding Forward-Looking Statements

The statements contained in this Management’s Discussion and Analysis that are not historical in nature are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements. In some cases, you can identify forward-looking statements by our use of words such as “may,” “will,” “should,” “could,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative or other variations of these words, or other comparable words or phrases. Factors that could cause or contribute to such differences include, but are not limited to, the fact that we are a start-up company; we need to raise funds to meet business plan projections; we are dependent on upon emerging technology for our business model; our ability to successfully expand our employee base, sales force and marketing program; changes in our customers’ requirements or tastes; the risks that competition, technological change or evolving customer preferences could adversely affect the sale of our products; and other factors identified from time to time in the Company’s reports filed with the Securities and Exchange Commission, including, but not limited to our Annual Report on Form 10-KSB filed on or about April 17, 2006.

Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements or other future events. Moreover, neither we nor anyone else assumes responsibility for the accuracy and completeness of forward-looking statements. We are under no duty to update any of our forward-looking statements after the date of this report. You should not place undue reliance on forward-looking statements.

MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following discussion of the financial condition and results of operations of the Company should be read in conjunction with the consolidated financial statements and related notes, which are included herein. This report contains forward-looking statements that involve risks and uncertainties. The Company’s actual results could differ materially from those indicated in the forward-looking statements.

OVERVIEW

Novint was initially incorporated in the State of New Mexico as Novint Technologies, Inc., in April 1999. On February 26, 2002, the state of incorporation was changed to Delaware by merging into Novint Technologies, Inc., a Delaware corporation. There are no subsidiaries, and business operates under Novint Technologies, Inc. Novint is a haptics technology company (haptics refers to your sense of touch), which develops, markets and sells applications and technologies that allow people to use their sense of touch to interact with computers.

To date, Novint has derived the majority of its revenues from developing professional applications for its customers. The Company has completed a number of contracts with companies such as Aramco, Lockheed Martin, Chrysler, Chevron, Sandia National Laboratories and Woods Hole Oceanographic Institute.

While Novint continues to develop professional applications for its customers, the Company also is preparing to leverage its computer touch technology to exploit opportunities in the consumer console and PC interactive computer games market. Using our haptics technology, games and applications will have the crucial missing “third sense” to human computer interaction. Users will be able to directly and intuitively feel the shape, texture and physical properties of virtual objects using our computer touch hardware and software.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

High-quality financial statements require rigorous application of accounting policies. Our policies are discussed in our audited financial statements for the year ended December 31, 2005, and are considered by management to be critical for an understanding of our financial statements because their application places the most significant demands on management’s judgment, with financial reporting results relying on estimation about the effect of matters that are inherently uncertain. We

review the accounting policies we use in reporting our financial results on a regular basis. As part of such review, we assess how changes in our business processes and products may affect how we account for transactions. We have not changed our critical accounting policies or practices during 2005 or through May 15, 2006. However, we are evaluating how improvements in processes and other changes in haptics technology and our emerging video games business may impact revenue recognition policies in the future.

REVENUE AND COST RECOGNITION — We recognize revenue from the sale of software products under the provisions of SOP 97-2, Software Revenue Recognition, as amended by SOP 98-4 and SOP 98-9. SOP 97-2 generally requires that revenue recognized from software arrangements be allocated to each element of the arrangement based on the relative vendor specific objective evidence of fair values of the elements, such as software products, upgrades, enhancements, post contract customer support, installation, or training. Under SOP 97-2, if the determination of vendor specific objective evidence of fair value for each element of the arrangement does not exist, all revenue from the arrangement is deferred until such time that evidence does exist or until all elements of the arrangement are delivered.

Our revenue recognition policy is as follows:

Project revenue consists of programming services provided to unrelated parties under fixed-price contracts. Revenues from fixed price programming contracts are recognized in accordance with Statement of Position (SOP) 81-1, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, and Accounting Research Bulletin (ARB) 45, Long-Term Construction-Type Contracts, using the percentage-of-completion method, measured by the percentage of costs incurred to date compared with the total estimated costs for each contract. Novint accounts for these measurements on the balance sheet under costs and estimated earnings in excess of billings on contracts and billings in excess of costs and estimated earnings on contracts. Provisions for estimated losses on uncompleted contracts are made and recorded in the period in which the loss is identified.

Revenue from product sales relates to the sale of the Phantom haptics interface which is a human-computer user interface (the Phantom). The Phantom allows the user to experience sensory information when using a computer and its handle is the approximate size and shape of a writing instrument. Phantoms are manufactured by an unrelated party and are shipped directly to the customer.

Emerging Issues Task Force (EITF) 00-10, Accounting for Shipping and Handling Fees and Costs, require amounts billed to a customer in a sales transaction related to shipping and handling, if any, to be classified and accounted for as revenues earned for the goods provided, whereas shipping and handling costs incurred by a company are required to be classified as cost of sales. Novint’s costs associated with shipping inventory items to Novint’s customers are included in Novint’s Cost of Goods Sold amount. Novint does not charge a separate or additional fee for shipment to their customers, rather this fee is included in the price and therefore part of Novint’s product revenue. No provision for sales returns has been provided in these financial statements, as Novint has never had a sales return. EITF 01-14, Income Statement Characterization of Reimbursements Received for “Out-of-Pocket” Expenses Incurred, requires reimbursements received for out-of-pocket expenses incurred while providing services to be characterized in the income statement as revenue. Novint’s out-of-pocket expenses incurred in connection with their project revenues are recognized in revenues based on a computed overhead rate that is included in their project labor costs to derive a project price.

In accordance with EITF 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent, Novint recognizes its product sales on a gross basis. Novint is responsible for fulfillment, including the acceptability of the product ordered. Novint has risks and rewards of ownership such as the risk of loss for collection, delivery or returns. Title passes to the customer upon receipt of the product by the customer. In accordance with the Company’s agreement with its customer, further obligation is limited to the terms defined in its warranty.

IMPAIRMENT — In accordance with SFAS 144, Accounting for the Impairment or Disposal of Long-Lived Assets, we review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying

amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

ACCOUNTS RECEIVABLE — We utilize the allowance method for accounts receivable valuation, providing for allowances for estimated uncollectible accounts receivable. Our financial instruments that are exposed to concentration of credit risk consist primarily of uninsured cash, cash equivalents and available-for-sale securities held at commercial banks and institutions primarily in the United States and trade receivables from our customers. We routinely assess the financial strength of our customers as part of our consideration of accounts receivable collectibility by performing credit evaluations of customers. Trade receivables are not collateralized. We generally grant credit terms to most customers ranging from 30 to 90 days.

SOFTWARE DEVELOPMENT COSTS — We account for our software development costs in accordance with SFAS 86, Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed. This statement requires that, once technological feasibility of a developing product has been established, all subsequent costs incurred in developing that product to a commercially acceptable level be capitalized and amortized ratably over the estimated life of the product, which is 5 years. We have capitalized software development costs in connection with our haptic software beginning in 2000 and in connection with our gaming technology beginning in 2006. Amortization is computed on the straight-line basis over the remaining life (five years) of our software platform.

INTERNAL USE SOFTWARE — We have adopted Statement of Position (SOP) No. 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use, during 2001, which requires capitalization of certain costs incurred during the development of internal use software. On a quarterly basis, we perform a review of our software expenditures to determine if any should be capitalized.

INTANGIBLES — Effective January 1, 2002, we adopted SFAS 142, Goodwill and Other Intangible Assets. SFAS 142 requires intangible assets to be tested for impairment in accordance with SFAS 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, which has been superseded by SFAS 144, Accounting for the Impairment or Disposal of Long-Lived Assets. We perform a periodic review of our identified intangible assets to determine if facts and circumstances exist which indicate that the useful life is shorter than originally estimated or that the carrying amount of assets may not be recoverable. If such facts and circumstances do exist, we assess the recoverability of identified intangible assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. After an impairment loss is recognized, the adjusted carrying amount shall be its new accounting basis.

RECENT ACCOUNTING PRONOUNCEMENTS

The Company has adopted all accounting pronouncements issued before March 31, 2006, which are applicable to the Company.

provisions of SFAS No. 133 and SFAS No. 140. This statement is effective for all financial instruments acquired or issued in fiscal years beginning after September 15, 2006. The Company does not believe the adoption of SFAS No. 155 will have any impact on the Company’s financial position or results of operations.

RESULTS OF OPERATIONS

QUARTER ENDED MARCH 31, 2006 COMPARED TO THE QUARTER ENDED MARCH 31, 2005.

REVENUES. During the quarter ended March 31, 2006, Novint had revenues of $38,781 as compared to revenues of $115,211 during the quarter ended March 31, 2005, a decrease of approximately 66.3%. The decrease primarily results from additional contract activities during the quarter ended March 31, 2005. During the three months ended March 31, 2006, Novint had four employees working on three contracts while, during the three months ended March 31, 2005, the Company had eight employees working on three major contracts. Timing of contracts is not within a specified time period during the year so quarterly comparisons may not validly represent annual activity. In addition, during the quarter ended March 31, 2005, one haptic interface device was sold for $27,000 while no such sales occurred in the first quarter of 2006.

COST OF GOODS SOLD AND GROSS PROFIT (LOSS). Cost of goods sold, which consists of materials purchased for resale to customers and the direct labor incurred for delivering on projects, were $59,411 for the quarter ended March 31, 2005, compared to $25,679 for the quarter ended March 31, 2006. Novint’s average gross profit percentage on contract activity was approximately 54.4% for the three months ended March 31, 2005, compared to 30.3% for the three months ended March 31, 2006. The decrease in gross profit percentage resulted due to an unusually high profit percentage on one fixed price contract in 2005. This higher profit percentage was a result of actual costs incurred being lower than those projected during contract negotiations.

OPERATING EXPENSES. Operating expenses totaled $1,008,429 for the quarter ended March 31, 2005, compared to $609,912 for the quarter ended March 31, 2006, a decrease of approximately $400,000 or 39%. Included in the decrease is approximately $320,000 in research and development expenditures incurred during 2005 attributable to our efforts to develop computer gaming technology. Beginning in 2006, research and development efforts tapered off as the Company completed design and development of the hardware gaming technologies. During the quarter ended March 31, 2006, Novint had two less full time equivalent employees (FTE’s) than during the quarter ended March 31, 2005. Sales and marketing decreased by approximately $20,000 as efforts to market our computer gaming technology was not as large a focus for the quarter. Offsetting these decreases, legal fees related to public filing increased during the quarter ended March 31, 2006.

LOSS FROM OPERATIONS: Novint had a loss from operations of $952,629 for the quarter ended March 31, 2005, compared to a loss from operations of $596,810 for the quarter ended March 31, 2006. Net losses have decreased as a result of the decrease in operating expenses as described above.

NET LOSS. Novint had a net loss of $952,687, or $0.07 per share, for the quarter ended March 31, 2005, compared to $629,737, or $0.04 per share, for the quarter ended March 31, 2006. In addition to the increase in loss from operations Novint recorded approximately $33,000 in interest expense attributable to notes payable executed late in 2005. We believe that net losses may increase in the short term until labor efforts and associated costs are refocused on contracted and revenue-generating activities and until gaming technology is successfully marketed.

LIQUIDITY AND CAPITAL RESOURCES

Novint closed a funding round in February and May of 2004 in which we raised $3,049,000. We have used a significant portion of the sources of cash to pay off certain liabilities including notes payable, offering costs and salaries. However, if we are successful in developing our gaming technology and video games business, and in developing partnerships with game publishers and hardware manufacturers, we will need to raise approximately another $15 million in funding to execute our current business plan with respect to our video games business. There can be no assurances that we will be able to obtain any

additional financing on favorable terms, if at all. Borrowing money may involve pledging some or all of our assets. Raising additional funds by issuing common stock or other types of equity securities would further dilute our existing shareholders.

Since inception, Novint has incurred net operating losses and other equity charges, which have resulted in an accumulated deficit of $8,968,943 at March 31, 2006 and $8,168,232 at December 31, 2005. For the three months ended March 31, 2006 and the year ended December 31, 2005, Novint had net losses totaling $629,737 and $3,386,405, respectively. Since inception, management has raised equity totaling approximately $5.7 million through various private equity transactions and has approximately $61,000 and $42,000 in cash on hand at March 31, 2006 and December 31, 2005, respectively. Without additional equity infusion or long term borrowings, there is substantial doubt as to the Company’s ability to continue as a going concern. Management believes they will need additional funding to supplement their cash on hand along with revenues from project and product sales to allow Novint to satisfy its short term obligations and provide enough cash flow for Novint to continue operations. Management has the ability to curtail spending and negotiate or push back payments to third parties, or settle such expenditures in stock in the event they experience cash shortfalls or in the event the next round of funding does not occur or takes significantly longer than anticipated.

In April 2006, we sold 500,000 shares of common stock and 250,000 warrants to purchase common stock to an unrelated party for $500,000. The warrants have an exercise price per share of $2.00. The purchase price of the Common Stock is subject to adjustment as follows: In the event, that after the date of the agreement, we shall complete an offering of securities on or before April 1, 2007 which results in gross proceeds to the us of not less than $3,000,000, and if such offering is conducted at a price per share of Common Stock of $1.11 per share or less, then, the Purchase Price Per Share of Common Stock shall be automatically adjusted to equal 90% of the issue price.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In January 2005, we granted 75,000 options to purchase common stock at $0.66 per share and a 5-year annual vesting provision to an employee and 10,000 options to purchase common stock at $0.66 per share and a 4-year annual vesting provision to an advisory board member for consulting services. The recipients of the options were Bill Anderson and Eric Hansen. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2005, we granted 100,000 options to purchase common stock at $0.66 per share to an employee and a 4-year annual vesting provision. The recipients of the options were Jonathan Miller and Peter Thomas. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2005, we issued a warrant to purchase 100,000 shares of our common stock to our legal counsel, Richardson & Patel, LLP as part of a fee agreement for providing legal services to Novint during 2004 with an exercise price of $1.00 per share. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of

these options. The warrant holder is an Accredited Investor as defined in the Securities Act who took the warrant for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the acquisition of the warrant. The investor was permitted access to our management for the purpose of acquiring investment information. Due to the investors’ status as service providers and their dealings with development companies generally, we deem the investors sophisticated for the purposes of Section 4(2) of the Act.

In June 2005, Novint issued 2,500 shares of common stock to Peter Thomas, a consultant for services performed. The stock was valued at $0.66 per share for total consideration of $1,650. An additional 2,500 shares of common stock were issued on March 1, 2006 and the company committed to issue an additional 2,500 shares each on September 1, 2006 and March 1, 2007. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these shares. The shareholders took the shares for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the shares. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we issued 117,400 shares of common stock to certain consultants in exchange for services rendered during the first quarter of 2005 and for services to be rendered. The recipients of the shares were Coleman Brand Worx, Gerald Grafe, Brad Carvey, Rob Shaw, Jan Easton Carrasco, Brenda Brown, Claire Bauder and Sandia National Laboratories. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we issued 32,400 shares of common stock to certain consultants in exchange for services rendered during the second quarter of 2005 and for services to be rendered. The recipients of the shares were Allan Hisey, Ed Barsis, Peter Mattern, Gerald Grafe, and Glyn Anderson. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we issued 10,000 shares of common stock to Mark Benak, an employee for services rendered during the second quarter of 2005. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we issued 250,000 shares of common stock to Force Dimension in connection with an amendment to our contract. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we granted 28,636 non-qualified options to purchase Company stock to certain related parties and consultants at an exercise price of $.66 per share for services rendered during the second quarter of 2005. The recipients of the options were Steven Maslow, Arline Pranitz and Lem Hunter. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In May 2005, we granted 25,000 options to purchase Company stock to Antonia Chappell, an employee, for services rendered during the second quarter of 2005. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

The Company issued 15,000 shares of common stock to Mark Betti, an advisory board member, for services rendered during the third quarter of 2005. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In August 2005, the Company issued 500 shares of common stock to Hector Reyes, a consultant for services rendered during the third quarter of 2005. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2006, the Company issued 6,000 shares of common stock to Ralph Anderson, a consultant, for services rendered during the first quarter of 2006. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act

In March 2006, the Company issued 1,250,002 shares of common stock to various investors in repayment of promissory notes issued during the year ended December 31, 2005. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2006, we granted 607,500 shares of common stock to Force Dimension in full payment of amounts outstanding on our contract. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2006, we also granted 200,329 shares of common stock to our private placement investors in recognition of delays in meeting specified filing obligations. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2006, we converted 4,000 shares of preferred stock to 447,300 shares of common stock in accordance with the terms of the conversion options of the original issue of stock to Sandia Corporation. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholders took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholders were permitted access to our management for the purpose of acquiring investment information. Due to the shareholders’ status as employees and consultants and their dealings with development companies generally, we deem the shareholders sophisticated for the purposes of Section 4(2) of the Act.

In March 2006, Novint granted 250,000 options at an exercise price of $1.00 per share, with a 5-year annual vesting provision, to purchase common stock to an employee. The recipient of the options was Bill Anderson. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these options. The shareholder took the options for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the options. The shareholder was permitted access to our management for the purpose of acquiring investment information. Due to the shareholder’s status as an employee and his dealings with development companies generally, we deem the shareholder sophisticated for the purposes of Section 4(2) of the Act.

In April 2006, we issued 500,000 shares of common stock at a price per share of $1.00, together with a Common Stock Purchase Warrant to purchase 250,000 shares of common stock at an exercise price of $2.00 per share, exercisable until April 1011. The recipient of the common stock and warrant was an accredited investor within the meaning of the Securities Act. We relied upon the exemption from registration as set forth in Section 4(2) of the Act for the issuance of these securities. The holder took the securities for investment purposes without a view to distribution and had access to information concerning Novint and our business prospects, as required by the Securities Act. In addition, there was no general solicitation or advertising for the issuance of the securities. The holder was permitted access to our management for the purpose of acquiring investment information. Due to the holder’s status as accredited and his dealings with development companies generally, we deem the holder sophisticated for the purposes of Section 4(2) of the Act.

Item 6. Exhibits

ITEM 13. EXHIBITS


Number		Description
3.1*		Articles of Incorporation

3.2*		Bylaws


Number		Description
3.3*		Articles of Merger

3.4*		Certificate of Merger

4.1*		Articles of Incorporation (See Exhibit 3.1)

4.2		Form of Common Stock Purchase Warrant, April 2006.

10.1*		License Agreement with Sandia; Amendments

10.2*		Lease for 9620 San Mateo

10.3*		Employment Agreement with Tom Anderson

10.4*		Employment Agreement with Walter Aviles

10.5*		2004 Incentive Stock Plan

10.6*		Shareholders Agreement

10.7*		Lock Up Agreement

10.8*		Miscellaneous Technical Services Agreement between Aramco Services Company and Novint Technologies, Inc.

10.9*		Contract Addendum between Aramco Services Company and Novint Technologies, Inc.

10.10*		Amendment to Contract between Aramco Services Company and Novint Technologies, Inc.

10.11*		Amendment to Contract between Aramco Services Company and Novint Technologies, Inc.

10.12*		Statement of Work between Chevron Corporation and Novint Technologies, Inc.

10.13*		Purchase Order from DaimlerChrylser Corporation

10.14*		Purchase Order # 94059 from LockheedMartin Corporation

10.15*		Purchase Order # 96996 from LockheedMartin Corporation

10.16*		Purchase Order # 97860 from LockheedMartin Corporation

10.17*		Purchase Order # Q50601685 from LockheedMartin Corporation

10.18*		Purchase Order # QQ060592 from LockheedMartin Corporation

10.19*		Purchase Order # Q50608809 from LockheedMartin Corporation

10.20*		Purchase Order #24232 from Sandia National Laboratories

10.21*		Purchase Order #27467 from Sandia National Laboratories

10.22*		Purchase Order #117339 from Sandia National Laboratories

10.23*		Purchase Order #250810 from Sandia National Laboratories

10.24*		Undersea Exploration Modeling Agreement between Woods Hole Oceanographic Institute and Novint Technologies, Inc.

10.25*		Purchase Order for Lunar Design, Inc. dated April 7, 2005

10.26*		Sublicense Agreement between Manhattan Scientifics and Novint Technologies, Inc.


Number		Description
10.27*		License and Royalty Agreement between Manhattan Scientifics and Novint Technologies, Inc.

10.28*		Research Development and License Agreement between Manhattan Scientifics and Novint Technologies, Inc.

10.29*		Intellectual Property License Agreement with Force Dimension LLC

10.30*		Purchase Order with Lockheed Martin dated April 1, 2005

10.31*		Purchase Order with Lockheed Martin dated April 4, 2005

10.32*		Purchase Order with Lockheed Martin dated April 21, 2005

10.33*		Purchase Order with Deakin University dated April 6, 2004

10.34*		Purchase Order with Robarts Research dated September 24, 2004

10.35*		Purchase Order with University of New Mexico dated March 16, 2004

10.36*		Amendment to Agreement with Force Dimension Dated May 5, 2005

10.37*		Amendment to contract between Aramco Services Company and Novint Technologies, Inc.

10.36#		Purchase Order with Lockheed Martin dated February 16, 2006

10.37#		Amendment to Intellectual Property License Agreement with Force Dimension LLC dated March 9, 2006

10.38#		Purchase Order with Lockheed Martin dated March 3, 2006

10.39		Form of Subscription Agreement for Securities, April 2006.

14#		Code of Ethics

31		Certification Pursuant To Section 302 Of The Sarbanes-Oxley Act Of 2002

32		Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002


*		Filed with the Issuer’s Registration Statement on Form SB-2 on May 17, 2004, and as subsequently amended, and incorporated herein by reference.
#		Filed with the Issuer’s Annual Report on Form 10KSB, filed with the Commission on April 17, 2006, and incorporated herein by reference.

All other exhibits are filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	NOVTIN TECHNOLOGIES, INC.
	By:	/s/ TOM ANDERSON

		Tom Anderson
		Chief Executive Officer , President and Chief Financial Officer May 22, 2006

Exhibit 4.2

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ SECURITIES ACT ”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR REASONABLY ACCEPTABLE TO THE COMPANY TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 50 1(a) UNDER THE SECURITIES ACT.

COMMON STOCK PURCHASE WARRANT

To Purchase Shares of Common Stock of

NOVINT TECHNOLOGIES, INC.

THIS COMMON STOCK PURCHASE WARRANT (the “ Warrant ”) CERTIFIES that, for value received, (the “ Holder ”), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after (the “ Initial Exercise Date ”) and on or prior to the close of business on the fifth anniversary of the issuance date of this Warrant (the “ Termination Date ”) but not thereafter, to subscribe for and purchase from Novint Technologies, Inc., a corporation incorporated in the State of Delaware (the “ Company ”), up to shares (the “ Warrant Shares ”) of Common Stock, par value $0.01 per share, of the Company (the “ Common Stock ”). The purchase price of one share of Common Stock (the “ Exercise Price ”) under this Warrant shall be $2.00 subject to adjustment hereunder. The Exercise Price and the number of common shares for which the Warrant is exercisable (the “Warrant Shares”) shall be subject to adjustment as provided herein. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Subscription Agreement (the “ Subscription Agreement ”) among the Company and the Holder.

1. Title to Warrant . This Warrant and all rights hereunder are transferable, in whole or in part, at the office or agency of the Company by the Holder in person or by duly authorized attorney, upon surrender of this Warrant together with the Assignment Form annexed hereto properly endorsed. The transferee shall sign an investment letter in form and substance reasonably satisfactory to the Company.

2. Authorization of Shares . The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).

3. Exercise of Warrant .

(a) Exercise of the purchase rights represented by this Warrant may be made at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy of the Notice of Exercise Form annexed hereto (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of such Holder appearing on the books of the Company); provided, however, within 5 Trading Days of the date said Notice of Exercise is delivered to the Company, the Holder shall have surrendered this Warrant to the Company and the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank. Certificates for shares purchased hereunder shall be delivered to the Holder within 15 Trading Days from the delivery to the Company of the Notice of Exercise Form by facsimile copy, surrender of this Warrant and payment of the aggregate Exercise Price as set forth above. Notwithstanding anything contained in this Warrant to the contrary, the Holder shall not have the right to exercise any portion of this Warrant, to the extent that after giving effect to such exercise, the Holder (together with the Holder’s affiliates) would have acquired, through exercise of the Warrant or otherwise, beneficial ownership of a number of shares of Common Stock exceeding 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number of shares of Common Stock issuable upon exercise of the Warrants with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder or any of its affiliates, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including, without limitation, any other warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this Section 3(a), beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes of this Section 3(a), in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (1) the Company’s most recent Form 10-Q, Form 10-K or other public filing with the Commission, as the case may be, if any, (2) a more recent public announcement by the Company, or (3) any other notice by the Company or its transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written request of the Holder, the Company shall promptly, but in no event later than 2 Trading Days following the receipt of such notice, confirm in writing to any such holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including the exercise of any

portion of this Warrant, by the Holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported.

(b) If this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the certificate or certificates representing Warrant Shares, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

(c) Subject to the provisions of this Section 3, if the Closing Price for each of any ten consecutive Trading Days after the Effective Date (the “ Measurement Price ”) exceeds 150% of the then Exercise Price (the “ Threshold Price ”), then the Company may call for cancellation of all or any portion of this Warrant for which a Notice of Exercise has not yet been delivered (such right, a “ Call ”). To exercise this right, the Company must deliver to the Holder an irrevocable notice (a “ Call Notice ”) indicating therein the portion of unexercised portion of this Warrant to which such notice applies. If the conditions set forth below for such Call are satisfied from the period from the date of the Call Notice through and including the Call Date (as defined below), then any portion of this Warrant subject to such Call Notice for which a Notice of Exercise and, within 7 Trading Days after the Call Date, payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank shall not have been received by the Company from and after the date of the Call Notice will be cancelled at 6:30 p.m. (Los Angeles Time) on the 60th Trading Day after the date the Call Notice is received by the Holder (such date, the “ Call Date ”). Any unexercised portion of this Warrant to which the Call Notice does not pertain will be unaffected by such Call Notice. In furtherance thereof, the Company covenants and agrees that it will honor all Notices of Exercise with respect to Warrant Shares subject to a Call Notice that are tendered from the time of delivery of the Call Notice through 6:30 p.m. (Los Angeles Time) on the Call Date. The parties agree that any Notice of Exercise delivered following a Call Notice shall first reduce to zero the number of Warrant Shares subject to such Call Notice prior to reducing the remaining Warrant Shares available for purchase under this Warrant. For example, if (x) this Warrant then permits the Holder to acquire 100 Warrant Shares, (y) a Call Notice pertains to 75 Warrant Shares, and (z) prior to 6:30 p.m. (Los Angeles Time) on the Call Date the Holder tenders a Notice of Exercise in respect of 50 Warrant Shares, then (1) on the Call Date the right under this Warrant to acquire 25 Warrant Shares will be automatically cancelled, (2) the Company, in the time and manner required under this Warrant, will have issued and delivered to the Holder 50 Warrant Shares in respect of the exercises following receipt of the Call Notice, and (3) the Holder may, until the Termination Date, exercise this Warrant for 25 Warrant Shares (subject to adjustment as herein provided and subject to subsequent Call Notices). Subject again to the provisions of this Section 3, the Company may deliver subsequent Call Notices for any portion of this Warrant for which the Holder shall not have delivered a Notice of Exercise. Notwithstanding anything to the contrary set forth in this Warrant, the Company may not deliver a Call Notice or require the cancellation of this Warrant (and any Call Notice will be void), unless, from the beginning of the 10 consecutive Trading Days used to determine whether the Common Stock has achieved the Threshold Price and Threshold Volume through the Call Date, (i) the Company shall have honored in accordance with the terms of this Warrant all Notices of Exercise delivered by 6:30 p.m. (Los Angeles Time) on the Call Date, (ii) the Registration Statement shall be effective as to all Warrant Shares and the prospectus thereunder available for use by the Holder for the resale all such Warrant Shares and (iii) the Common Stock shall be

listed or quoted for trading on the Trading Market. Further, notwithstanding anything to the contrary set forth in this Warrant, the Company shall not Call any portion of this Warrant to the extent that the Holder would be unable to voluntarily exercise such portion of this Warrant in advance of the Call Date with respect to such Call due to the restrictions on exercise set forth in Section 3(a), without the Holder further effecting sales of Common Stock. The Holder agrees to promptly furnish the Company, upon its request, with information regarding the Holder’s then-current holdings of Common Stock in order to assist the Company in complying with the foregoing sentence.

4. No Fractional Shares or Scrip . No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share that Holder would otherwise be entitled to purchase upon such exercise, the Company shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price.

5. Charges, Taxes and Expenses . Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder; and the Company may require. as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.

6. Closing of Books . The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

7. Transfer, Division and Combination .

(a) Subject to compliance with any applicable securities laws and the conditions set forth in Sections 1 and 7(e) hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

(b) This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 7(a), as to any transfer which

may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice.

(c) The Company shall prepare, issue and deliver at its own expense (other than transfer taxes) the new Warrant or Warrants under this Section 7.

(d) The Company agrees to maintain, at its aforesaid office, books for the registration and the registration of transfer of the Warrants.

(e) If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws, the Company may require, as a condition of allowing such transfer (i) that the Holder or transferee of this Warrant, as the case may be, furnish to the Company a written opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions and reasonably acceptable to the Company) to the effect that such transfer may be made without registration under the Securities Act and under applicable state securities or blue sky laws, (ii) that the holder or transferee execute and deliver to the Company an investment letter in form and substance acceptable to the Company and (iii) that the transferee be an “accredited investor” as defined in Rule 50 1(a) promulgated under the Securities Act.

8. No Rights as Shareholder until Exercise . This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the exercise hereof. Upon the surrender of this Warrant and the payment of the aggregate Exercise Price (or by means of a cashless exercise), the Warrant Shares so purchased shall be and be deemed to be issued to such Holder as the record owner of such shares as of the close of business on the later of the date of such surrender or payment.

9. Loss, Theft, Destruction or Mutilation of Warrant . The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

10. Saturdays, Sundays, Holidays, etc . If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall be a Saturday, Sunday or a legal holiday, then such action may be taken or such right may be exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

11. Stock Splits . The number and kind of securities purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the happening of any of the following. In case the Company shall (i) pay a dividend in shares of

Common Stock or make a distribution in shares of Common Stock to holders of its outstanding Common Stock, (ii) subdivide its outstanding shares of Common Stock into a greater number of shares, (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock, or (iv) issue any shares of its capital stock in a reclassification of the Common Stock, then the number of Warrant Shares purchasable upon exercise of this Warrant immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company which it would have owned or have been entitled to receive had such Warrant been exercised in advance thereof Upon each such adjustment of the kind and number of Warrant Shares or other securities of the Company which are purchasable hereunder, the Holder shall thereafter be entitled to purchase the number of Warrant Shares or other securities resulting from such adjustment at an Exercise Price per Warrant Share or other security obtained by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares purchasable pursuant hereto immediately prior to such adjustment and dividing by the number of Warrant Shares or other securities of the Company resulting from such adjustment. An adjustment made pursuant to this paragraph shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event.

12. Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets . In case the Company shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect to the Common Stock of the Company), or sell, transfer or otherwise dispose of its property, assets or business to another corporation and, pursuant to the terms of such reorganization, reclassification, merger, consolidation or disposition of assets, shares of common stock of the successor or acquiring corporation, or any cash, shares of stock or other securities or property of any nature whatsoever (including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“ Other Property ”), are to be received by or distributed to the holders of Common Stock of the Company, then the Holder shall have the right thereafter to receive, at the option of the Holder, (a) upon exercise of this Warrant, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and Other Property receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a Holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such event or (b) cash equal to the value of this Warrant as determined in accordance with the Black Scholes option pricing formula. In case of any such reorganization, reclassification, merger, consolidation or disposition of assets, the successor or acquiring corporation (if other than the Company) shall expressly assume the due and punctual observance and performance of each and every covenant and condition of this Warrant to be performed and observed by the Company and all the obligations and liabilities hereunder, subject to such modifications as may be deemed appropriate (as determined in good faith by resolution of the Board of Directors of the Company) in order to provide for adjustments of Warrant Shares for which this Warrant is exercisable which shall be as nearly equivalent as practicable to the adjustments provided for in this Section 12. For purposes of this Section 12, “common stock of the successor or acquiring corporation” shall include stock of such corporation of any class which is not preferred as to dividends or assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other securities which

are convertible into or exchangeable for any such stock, either immediately or upon the arrival of a specified date or the happening of a specified event and any warrants or other rights to subscribe for or purchase any such stock. The foregoing provisions of this Section 12 shall similarly apply to successive reorganizations, reclassifications, mergers, consolidations or disposition of assets.

13. Voluntary Adjustment by the Company . The Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.

14. Notice of Adjustment . Whenever the number of Warrant Shares or number or kind of securities or other property purchasable upon the exercise of this Warrant or the Exercise Price is adjusted, as herein provided, the Company shall give notice thereof to the Holder, which notice shall state the number of Warrant Shares (and other securities or property) purchasable upon the exercise of this Warrant and the Exercise Price of such Warrant Shares (and other securities or property) after such adjustment, setting forth a brief statement of the facts requiring such adjustment and setting forth the computation by which such adjustment was made.

15. Authorized Shares . The Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed.

16. Miscellaneous .

(a) Jurisdiction . All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Subscription Agreement between the Holder and the Company..

(b) Restrictions . The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon resale imposed by state and federal securities laws.

(c) Nonwaiver and Expenses . No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies, notwithstanding all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings,

incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

(d) Notices . Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Registration Rights Agreement.

(e) Limitation of Liability . No provision hereof, in the absence of any affirmative action by Holder to exercise this Warrant or purchase Warrant Shares, and no enumeration herein of the rights or privileges of Holder, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

(f) Remedies . The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate.

(g) Successors and Assigns . Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and shall be enforceable by any such Holder or holder of Warrant Shares.

(h) Amendment . This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

(i) Severability . Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

(j) Headings . The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

*****************

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized.


Dated: , 2006	NOVINT TECHNOLOGIES, INC.

	By:

		Tom Anderson
		Chief Executive Officer

NOTICE OF EXERCISE

To: Novint Technologies, Inc.

(1) The undersigned hereby elects to purchase Warrant Shares of Novint Technologies, Inc. pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2) Payment shall take the form of lawful money of the United States.

(3) Please issue a certificate or certificates representing said Warrant Shares in the name of the undersigned or in such other name as is specified below:

The Warrant Shares shall be delivered to the following:

(4) Accredited Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended.


Dated: , 2005	NOVINT TECHNOLOGIES, INC.

	By:

		Name:
		Title:

	Dated:

ASSIGNMENT FORM

(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to


	whose

address is		,

Dated: ,


		Holder’s Signature:


		Holder’s Address:

Signature Guaranteed:

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.

Exhibit 10.39

SUBSCRIPTION AGREEMENT

Novint Technologies, Inc.

(a Delaware corporation)

SUBSCRIPTION PROCEDURE

To Subscribe for Common Stock and Warrants of Novint Technologies, Inc. :

Date and Fill In the amount of Common Stock and Warrants being subscribed to and Complete and Sign the Subscription Agreement on the applicable Signature Page.

Fax the signed Agreement to, and send all signed originals to and form of payment to:

Novint Technologies
Attn: Tom Anderson, CEO
4109 Bryan Ave NW
Albuquerque, NM 87114
Phone: 505-463-1469
Fax: 866-298-4420

Please make your subscription payment payable to the order of “Novint Technologies, Inc.”

Wire Transfer Coordinates, if paying by wire transfer:

Wells Fargo Bank, NM
routing number: 107002192
account number: 1350427032
account name: Novint Technologies, Inc.

Thank you for your interest.

Novint Technologies, Inc.

SUBSCRIPTION AGREEMENT

The undersigned (hereinafter “ Subscriber ”) hereby confirms his/her/its subscription for the purchase of Common Stock, $0.01 par value, and warrants to purchase Common Stock (the “Warrants”) of Novint Technologies, Inc., a Delaware corporation (the “ Company ”), on the terms described below. .

The Common Stock and the Warrants, and the common shares issuable upon exercise of the Warrants are sometimes referred to collectively herein as the “ Securities .”

In connection with this subscription, Subscriber and the Company agree as follows:

1. Purchase and Sale of the Common Stock and Warrants .

(a) The Company hereby agrees to issue and to sell to Subscriber, and Subscriber hereby agrees to purchase from the Company, Common Stock, and Warrants to purchase Common Stock in amount set forth on the signature page to this Agreement. The Subscriber understands that this subscription is not binding upon the Company until the Company accepts it. The Subscriber acknowledges and understands that acceptance of this Subscription will be made only by a duly authorized representative of the Company executing and mailing or otherwise delivering to the Subscriber at the Subscriber’s address set forth herein, a counterpart copy of the signature page to this Subscription Agreement indicating the Company’s acceptance of this Subscription. The Company reserves the right, in its sole discretion for any reason whatsoever, to accept or reject this subscription in whole or in part. Following the acceptance of this Subscription Agreement by the Company, the Company will promptly issue and deliver to Subscriber the Common Stock and Warrants for the amount subscribed to against payment in U.S. Dollars of the Purchase Price (as defined below). If this subscription is rejected, the Company and the Subscriber shall thereafter have no further rights or obligations to each other under or in connection with this Subscription Agreement. If this subscription is not accepted by the Company on or before the last day of the Offering Period, this subscription shall be deemed rejected.

(b) Subscriber has hereby delivered and paid concurrently herewith the aggregate purchase price for the Common Stock and Warrants set forth on the signature page hereof (the “ Purchase Price ”), which amount has been paid in U.S. Dollars by wire transfer or check, subject to collection, to the order of “Novint Technologies, Inc.”

(c) The Common Stock offered hereby is sold at a price per share of $1.00 (the “Purchase Price Per Share”). The corresponding Warrants are sold, based on the aggregate subscription amount, to equal 50% coverage of the subscription amount. Such Warrants shall have an exercise price per share of $2.00. By way of example only, if a subscription is made for $500,000, the Subscriber would receive (i) 500,000 shares of Common Stock and (ii) a Warrant to purchase 250,000 shares at an exercise price of $2.00 per share. The purchase price of the Common Stock hereunder is subject to adjustment, as set forth below.

(d) In the event, that after the date hereof, the Company shall complete an offering of securities (an “Offering”) on or before April 1, 2007 which results in gross proceeds to the Company of not less than $3,000,000, and if such Offering is conducted at a price per share of Common Stock (or equivalent convertible securities) of $1.11 per share or less (the “Subsequent Price”), then, in such event, the Purchase Price Per Share of Common Stock hereunder shall be automatically adjusted to equal ninety percent (90%) of the Subsequent Price (the “Adjusted Purchase Price Per Share”), and an additional number of shares of Common Stock shall be issued to Subscriber as if the Purchase Price Per Share of Common Stock hereunder were such Adjusted Purchase Price Per Share. Upon such event, the Company shall, and without further action on the part of Subscriber, issue such additional shares of Common Stock to Subscriber as shall result from the Adjusted Purchase Price Per Share. Such additional shares shall be issued and delivered to Subscriber within fifteen (15) days following the consummation of the Offering.

2. Representations and Warranties of Subscriber . Subscriber represents and warrants to the Company and the Placement Agent as follows:

(a) Subscriber is an “accredited investor” as defined by Rule 501 under the Securities Act of 1933, as amended (the “ Act ”), and Subscriber is capable of evaluating the merits and risks of Subscriber’s investment in the Securities and has the ability and capacity to protect Subscriber’s interests.

(b) Subscriber understands that the Securities are not presently registered, but Subscriber is entitled to certain rights with respect to the registration of the Securities, as set forth herein. Subscriber understands that the Securities will not be registered under the Act on the ground that the issuance thereof is exempt under Section 4(2) of the Act as a transaction by an issuer not involving any public offering and that, in the view of the Commission, the statutory basis for the exception claimed would not be present if any of the representations and warranties of Subscriber contained in this Subscription Agreement or those of other purchasers of the Securities are untrue or, notwithstanding the Subscriber’s representations and warranties, the Subscriber currently has in mind acquiring any of the Securities for resale upon the occurrence or non-occurrence of some predetermined event.

(c) Subscriber is purchasing the Securities subscribed for hereby for investment purposes and not with a view to distribution or resale, nor with the intention of selling, transferring or otherwise disposing of all or any part thereof for any particular price, or at any particular time, or upon the happening of any particular event or circumstance, except selling, transferring, or disposing the Securities made in full compliance with all applicable provisions of the Act, the rules and regulations promulgated by the United States Securities and Exchange Commission (the “ SEC ”) thereunder, and applicable state securities laws; and that an investment in the Securities is not a liquid investment.

(d) Subscriber acknowledges that the Securities must be held indefinitely unless subsequently registered under the Act or unless an exemption from such registration is available. Subscriber is aware of the provisions of Rule 144 promulgated under the Act which permit resales of common stock purchased in a private placement subject to certain limitations and to

the satisfaction of certain conditions provided for thereunder, including, among other things, the existence of a public market for the common stock, the availability of certain current public information about the Company, the resale occurring not less than one year after a party has purchased and paid for the security to be sold, the sale being effected through a “broker’s transaction” or in transactions directly with a “market maker” and the number of shares of common stock being sold during any three-month period not exceeding specified limitations. Subscriber understands that there is presently no market for the Company’s securities and there is no assurance that a market will develop in the future.

(e) Subscriber acknowledges that Subscriber has had the opportunity to ask questions of, and receive answers from the Company or any authorized person acting on its behalf concerning the Company and its business and to obtain any additional information, to the extent possessed by the Company (or to the extent it could have been acquired by the Company without unreasonable effort or expense) necessary to verify the accuracy of the information received by Subscriber. In connection therewith, Subscriber acknowledges that Subscriber has had the opportunity to discuss the Company’s business, management and financial affairs with the Company’s management or any authorized person acting on its behalf. Without limiting the generality of the foregoing, Subscriber has been furnished with or has had the opportunity to acquire, and to review all information, both written and oral, that Subscriber desires with respect to the Company’s business, management, financial affairs and prospects. In determining whether to make this investment, Subscriber has relied solely on (i) Subscriber’s own knowledge and understanding of the Company and its business based upon Subscriber’s own due diligence investigations and the information furnished pursuant to this paragraph, and (ii) the information described in subparagraph 2(g) below.

(f) Subscriber has all requisite legal and other power and authority to execute and deliver this Subscription Agreement and to carry out and perform Subscriber’s obligations under the terms of this Subscription Agreement. This Subscription Agreement constitutes a valid and legally binding obligation of Subscriber, enforceable in accordance with its terms, subject to laws of general application relating to bankruptcy, insolvency and the relief of debtors and rules of law governing specific performance, injunctive relief or other general principals of equity, whether such enforcement is considered in a proceeding in equity or law.

(g) Subscriber has carefully considered and has discussed with the Subscriber’s legal, tax, accounting and financial advisors, to the extent the Subscriber has deemed necessary, the suitability of this investment and the transactions contemplated by this Subscription Agreement for the Subscriber’s particular federal, state, local and foreign tax and financial situation and has independently determined that this investment and the transactions contemplated by this Subscription Agreement are a suitable investment for the Subscriber. Subscriber has relied solely on such advisors and not on any statements or representations of the Company or any of its agents. Subscriber understands that Subscriber (and not the Company) shall be responsible for Subscriber’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Subscription Agreement.

(h) Subscriber acknowledges that an investment in the Securities is speculative and involves a high degree of risk and that Subscriber can bear the economic risk of the purchase of the Securities, including a total loss of his/her/its investment.

(i) Subscriber recognizes that no federal, state or foreign agency has recommended or endorsed the purchase of the Securities.

(j) Subscriber is aware that the Securities are and will be, when issued, “restricted securities” as that term is defined in Rule 144 of the general rules and regulations under the Act.

(k) Subscriber understands that any and all certificates representing the Securities and any and all securities issued in replacement thereof or in exchange therefor shall bear the following legend or one substantially similar thereto, which Subscriber has read and understands:

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL FOR THIS CORPORATION, IS AVAILABLE.”

(l) In addition, the certificates representing the Securities, and any and all securities issued in replacement thereof or in exchange therefor, shall bear such legend as may be required by the securities laws of the jurisdiction in which Subscriber resides.

(m) Subscriber acknowledges that Subscriber has such knowledge and experience in financial and business matters that Subscriber is capable of evaluating the merits and risks of an investment in the Securities and of making an informed investment decision with respect thereto.

(n) Subscriber represents that: (i) Subscriber is able to bear the economic risks of an investment in the Securities and to afford a complete loss of the investment, and (ii) (A) Subscriber could be reasonably assumed to have the ability and capacity to protect his/her/its interests in connection with this subscription; or (B) Subscriber has a pre-existing personal or business relationship with either the Company or any affiliate thereof of such duration and nature as would enable a reasonably prudent purchaser to be aware of the character, business acumen and general business and financial circumstances of the Company or such affiliate and is otherwise personally qualified to evaluate and assess the risks, nature and other aspects of this subscription.

(o) Subscriber understands that the Company shall have the unconditional right to accept or reject this subscription, in whole or in part, for any reason or without a specific reason, in the sole and absolute discretion of the Company (even after receipt and clearance of Subscriber’s funds). This Subscription Agreement is not binding upon the Company until accepted in writing by an authorized officer of the Company. In the event that this subscription

is rejected, then Subscriber’s subscription funds (to the extent of such rejection) will be promptly returned in full without interest thereon or deduction therefrom.

(p) Subscriber represents that Subscriber is not subscribing for the Securities as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over the Internet, television or radio or presented at any seminar or meeting or any public announcement or filing of or by the Company.

(q) Subscriber represents and warrants, to the best of Subscriber’s knowledge, that no finder, broker, agent, financial advisor or other intermediary, nor any purchaser representative or any broker-dealer acting as a broker, is entitled to any compensation in connection with the transactions contemplated by this Subscription Agreement.

3. Representations and Warranties of the Company . The Company represents and warrants to Subscriber as follows:

(a) The Company is duly organized and validly exists as a corporation in good standing under the laws of the State of Delaware.

(b) The Company has all such corporate power and authority to enter into, deliver and perform this Subscription Agreement.

(c) All necessary corporate action has been duly and validly taken by the Company to authorize the execution, delivery and performance of this Subscription Agreement by the Company, and the issuance and sale of the Securities to be sold by the Company pursuant to this Subscription Agreement. This Subscription Agreement has been duly and validly authorized, executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles.

4. Indemnification . Subscriber agrees to indemnify and hold harmless the Company and its respective officers, directors, employees, shareholders, agents, attorneys, representatives and affiliates, and any person acting for or on behalf of the Company, from and against any and all damage, loss, liability, cost and expense (including reasonable attorneys’ fees and disbursements) which any of them may incur by reason of the failure by Subscriber to fulfill any of the terms and conditions of this Subscription Agreement, or by reason of any breach of the representations and warranties made by Subscriber herein, or in any other document provided by Subscriber to the Company in connection with this investment. All representations, warranties and covenants of each of Subscriber and the Company contained herein shall survive the acceptance of this subscription and the Closings.

5. Registration Rights . In the event the Company decides to Register any shares of its Common Stock for cash (either for its own account or the account of a security holder), other than pursuant to a registration statement which exclusively relates to the registration of an

employee stock option, purchase, bonus or other benefit plan, then for so long as the Subscriber holds Securities, the Company will: (1) promptly give the Subscriber written notice thereof (which shall include a list of the jurisdictions in which the Company intends to attempt to qualify such securities under the applicable Blue Sky or other state securities laws) and (2) include in such registration (and any related qualification under Blue Sky laws or other compliance), and in any underwriting involved therein, all the Securities specified in a written request delivered to the Company by the Subscriber within 10 days after delivery of such written notice from the Company. The right of the Subscriber to have Securities included in any registration statement shall be conditioned upon the provision by the Subscriber of any information reasonably requested by the Company within ten (10) days of such request.

6. Miscellaneous .

(a) Subscriber agrees not to transfer or assign this Subscription Agreement or any of Subscriber’s interest herein and further agrees that the transfer or assignment of the Securities acquired pursuant hereto shall be made only in accordance with all applicable laws.

(b) Subscriber agrees that Subscriber cannot cancel, terminate, or revoke this Subscription Agreement or any agreement of Subscriber made hereunder, and this Subscription Agreement shall survive the death or legal disability of Subscriber and shall be binding upon Subscriber’s heirs, executors, administrators, successors, and permitted assigns.

(d) This Subscription Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and may be amended or waived only by a written instrument signed by all parties.

(e) Subscriber acknowledges that it has been advised and has had the opportunity to consult with Subscriber’s own attorney regarding this subscription and Subscriber has done so to the extent that Subscriber deems appropriate.

(f) Any notice or other document required or permitted to be given or delivered to the parties hereto shall be in writing and sent: (i) by fax if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid) or (c) by a recognized overnight delivery service (with charges prepaid).

If to the Company, at:

Novint Technologies, Inc.
4109 Bryan Ave NW
Albuquerque, NM 87114
Phone/Fax: 866-298-4420

With a copy to:

Jennifer A. Post, Esq.
Richardson & Patel LLP
10900 Wilshire Blvd., Suite 500
Los Angeles, California 90024
Tel: (310) 208-1182
Fax: (310) 208-1154

If to the Subscriber, at its address set forth on the signature page to this Subscription Agreement or such other address as Subscriber shall have specified to the Company in writing.

(g) Failure of the Company to exercise any right or remedy under this Subscription Agreement or any other agreement between the Company and the Subscriber, or otherwise, or any delay by the Company in exercising such right or remedy, will not operate as a waiver thereof. No waiver by the Company will be effective unless and until it is in writing and signed by the Company.

(i) This Subscription Agreement shall be enforced, governed and construed in all respects in accordance with the laws of the State of New Mexico, as such laws are applied by the New Mexico courts except with respect to the conflicts of law provisions thereof, and shall be binding upon the Subscriber and the Subscriber’s heirs, estate, legal representatives, successors and permitted assigns and shall inure to the benefit of the Company, and its successors and assigns.

(j) Any legal suit, action or proceeding arising out of or relating to this Subscription Agreement or the transactions contemplated hereby shall be instituted exclusively in a Federal or State Court located in Bernalillo County, New Mexico. The parties hereto hereby: (i) waive any objection which they may now have or hereafter have to the venue of any such suit, action or proceeding, and (ii) irrevocably consent to the jurisdiction of the aforesaid courts in any such suit, action or proceeding. The parties further agree to accept and acknowledge service of any and all process which may be served in any such suit, action or proceeding in the aforesaid courts and agree that service of process upon a party which is mailed by certified mail to such party’s address shall be deemed in every respect effective service of process upon such party in any such suit, action or proceeding.

(k) If any provision of this Subscription Agreement is held to be invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed modified to conform with such statute or rule of law. Any provision hereof that may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provisions hereof.

(l) The parties understand and agree that money damages would not be a sufficient remedy for any breach of this Subscription Agreement by the Company or the Subscriber and that the party against which such breach is committed shall be entitled to equitable relief, including an injunction and specific performance, as a remedy for any such breach, without the necessity of establishing irreparable harm or posting a bond therefor. Such remedies shall not be deemed to be the exclusive remedies for a breach by either party of this Subscription Agreement but shall be in addition to all other remedies available at law or equity to the party against which such breach is committed.

(m) All pronouns and any variations thereof used herein shall be deemed to refer to the masculine, feminine, singular or plural, as identity of the person or persons may require.

(n) This Subscription Agreement may be executed in counterparts and by facsimile, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.

[Remainder of Page intentionally left blank]

[Signature Pages Follow]

Signature Page for Individuals:

IN WITNESS WHEREOF, Subscriber has caused this Subscription Agreement to be executed as of the date indicated below.


$

		Total Principal Amount of Common Stock and Warrants Subscribed to and Purchase Price Thereof



Print or Type Name


Signature


Date


Social Security Number (if applicable)



Address

Please check if applicable and include co-owner’s information below (name, address, social security number):

_______ Joint Tenancy ______ Tenants in Common









`

FORM OF PAYMENT – CHECK OR WIRE TRANSFER

[ ] Check attached and made payable to: .

[ ] Wire funds from my outside account according to the Instructions set forth above.

Signature Page for Partnerships, Corporations or Other Entities:

IN WITNESS WHEREOF, Subscriber has caused this Subscription Agreement to be executed as of the date indicated below.



$

		Total Principal Amount of Common Stock and Warrants Subscribed to and Purchase Price Thereof



Print or Type Name of Entity



Address



Taxpayer I.D. No. (if applicable)		Date



Signature		Print or Type Name and Indicate
		Title or Position with Entity

FORM OF PAYMENT – CHECK OR WIRE TRANSFER

[ ] Check attached and made payable to: FCC f/b/o NGTV.

[ ] Wire funds from my outside account according to the Instructions set forth above.

Acceptance by Novint Technologies, Inc.:

IN WITNESS WHEREOF, the Company has caused this Subscription Agreement to be executed, and the foregoing subscription accepted, as of the date indicated below, as to Common Stock and Warrants for the the aggregate amount of $ .


	Novint Technologies, Inc.
	By:
		President and Chief Executive Officer

Date: __________________________, 2006

EXHIBIT 31

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT
TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Tom Anderson, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of Novint Technologies, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15e and 15d-15e) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this quarterly report my conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: May 22, 2006


		/s/ TOM ANDERSON

		Tom Anderson
		Chief Executive Officer, President and Chief Financial Officer

EXHIBIT 32

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Novint Technologies, Inc.. (the “Company”) on Form 10-QSB for the fiscal period ended March 31, 2006, as filed with the Securities and Exchange Commission on May 22, 2006 (the “Report”), I, Tom Anderon, Chief Executive Officer, President and Acting Chief Financial Officer of the Company, hereby certify pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 22, 2006


Albuquerque, New Mexico		/s/ TOM ANDERSON

		Tom Anderson
		Chief Executive Officer, President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to and will be retained by Novint Technologies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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