EX-10.3






Exhibit 10.3




TERMINATION AGREEMENT




THIS TERMINATION AGREEMENT (the “Agreement”) is entered into as of March 8, 2007 by and among
VIASPACE Inc., a Nevada corporation (the “Company”), Concentric Water Technologies, LLC, a Delaware
limited liability company (“Concentric”), Arroyo Sciences, Inc., a Delaware corporation (“Arroyo”),
Cornell Capital Partners LP, a Delaware limited partnership (“Cornell”), Carl Kukkonen (Kukkonen),
Amjad Abdallat (“Abdallat”) and David Gonzalez, Esq., as escrow agent (“Gonzalez”)



WHEREAS, Cornell is the holder of secured convertible debentures of the Company issued, dated
November 2, 2006 in the aggregate amount of $1,500,0000 and November 29, 2006, in the aggregate
amount of $1,200,000 (collectively the “Existing Debentures”), that were issued to Cornell in
connection with the transactions contemplated by that certain Securities Purchase Agreement dated
November 2, 2006 by and between Cornell and the Company (the “2006 Financing”);



WHEREAS, the Company and Cornell desire to restructure certain terms and conditions of the
2006 Financing including terminate certain of the agreements entered into in connection with the
2006 Financing and raise new equity financing (the “Current Financing”) pursuant to a Securities
Purchase Agreement dated as of even date herewith, by and between Cornell and the Company (the
“Securities Purchase Agreement”);



WHEREAS, the Company, Concentric, Arroyo and Cornell are parties to one or more agreements
relating to the 2006 Financing and granting various rights to Cornell as holder of the Existing
Debentures (collectively, the “Existing Rights Agreements”);



WHEREAS, in connection with the Current Financing, the Company and Cornell desire to cancel
certain of the Existing Rights Agreements; and



WHEREAS, capitalized terms used herein and not defined, have the meanings given to them in the
Securities Purchase Agreement.



NOW, THEREFORE, in consideration of the premises and the mutual agreements hereinafter set
forth, the parties hereby agree as follows:



SECTION 1. Termination of 2006 Financing Documents. 



1.1 Standby Equity Distribution Agreement. By their execution of this Agreement, the
undersigned parties consent to the termination of that certain Standby Equity Distribution
Agreement dated as of November 2, 2006 by and among the Company and the parties thereto, as
currently in effect (the “Standby Equity Distribution Agreement”), and acknowledge and agree that
they and each of the other parties thereto have no remaining rights under the Standby Equity
Distribution Agreement, and that the Standby Equity Distribution Agreement is hereby irrevocably
terminated and shall be of no further force or effect.



1.2 Investor Registration Rights Agreement. By their execution of this Agreement, the
undersigned parties consent to the termination of that certain Investor Restated Registration
Rights Agreement dated as of November 2, 2006 by and among the Company and the parties thereto, as
currently in effect (the “Investor Registration Rights Agreement”), and acknowledge and agree that
they and each of the other parties thereto have no remaining rights under the Investor Registration
Rights Agreement, and that the Investor Registration Rights Agreement is hereby irrevocably
terminated and shall be of no further force or effect.



1.3 Registration Rights Agreement. By their execution of this Agreement, the
undersigned parties consent to the termination of that certain Restated Registration Rights
Agreement dated as of November 2, 2006 by and among the Company and the parties thereto, as
currently in effect (the “Registration Rights Agreement”), and acknowledge and agree that they and
each of the other parties thereto have no remaining rights under the Registration Rights Agreement,
and that the Registration Rights Agreement is hereby irrevocably terminated and shall be of no
further force or effect.



SECTION 2. Termination of Security and Pledge Agreements.



2.1 Security Agreements. By their execution of this Agreement, the Company, Cornell,
Arroyo and Concentric consent to the termination of (i) that certain Security Agreement dated as of
November 2, 2006 by and between the Company and Cornell (the “Company Security Agreement”), (ii)
that certain Security Agreement dated as of November 2, 2006 by and between Cornell and Arroyo (the
“Arroyo Security Agreement”), and (iii) that certain Security Agreement dated as of November 2,
2006 by and between Cornell and Concentric (the “Concentric Security Agreement”) and acknowledge
and agree that they have no remaining rights under the Company Security Agreement, the Arroyo
Security Agreement or the Concentric Security Agreement, and that each of the Company Security
Agreement, the Arroyo Security Agreement and the Concentric Security Agreement is hereby
irrevocably terminated and shall be of no further force or effect.



2.2 Pledge Agreement. By their execution of this Agreement, Cornell, Kukkonen,
Abdallat and Gonzalaez consent to the termination of (i) that certain Insider Pledge and Escrow
Agreement dated as of November 2, 2006 by and between Cornell, Kukkonen and Gonzalez (the “Kukkonen
Pledge Agreement”) and (ii) that certain Insider Pledge and Escrow Agreement dated as of November
2, 2006 by and between Cornell, Abdallat and Gonzalez (the “Abdallat Pledge Agreement”), and
acknowledge and agree that they have no remaining rights under the each of the Kukken Pledge
Agreement and the Abdallat Pledge Agreement and that each of the Kukkonen Pledge Agreement and the
Abdallat Pledge Agreement is hereby irrevocably terminated and shall be of no further force or
effect.



2.3 Release of Security Interests and Return of Pledged Shares.



(a) By its execution of this Agreement, Cornell hereby releases all security interests it has
with respect to any and all assets of the Company, Arroyo and Concentric, including, but not
limited to, the Pledged Property (as such term is defined in the Company Security Agreement) and
authorizes and directs the Company to file on its behalf one or more UCC-3 Termination Statements
terminating all of Cornell’s security interests in any of the assets of the Company, including
termination of any UCC-1 Financing Statements filed in connection with the Original Financing.



(b) By its execution of this Agreement, Cornell hereby releases all security interests it has
with respect to the Pledged Shares (as such term is defined in the Kukkonen Pledge Agreement and
the Abdallat Pledge Agreement) and authorizes and directs Gonzalez, as Escrow Agent, to return the
Pledged Shares together with all duly executed stock powers or other appropriate transfer documents
with medallion bank guarantees, to Kukkonen or Abdallat, as appropriate.



SECTION 3. Waiver of Damages



By its execution of this Agreement, Cornell hereby waives any rights it may have to receive
any damages, penalty payments or liquidated damages, if owed, associated with the 2006 Financing
and the Existing Rights Agreements, and Cornell hereby agrees that it will not seek to recover from
the Company any damages, penalty payments or liquidated damages arising out of, or in connection
with 2006 Financing and the Existing Rights Agreements.



SECTION 4. Miscellaneous.



4.1 Entire Agreement. This Agreement states the entire agreement of the parties
concerning the subject matter hereof, and supersedes all prior agreements, written or oral, between
or among them concerning such subject matter.



4.2 Amendments; Waivers. This Agreement may be amended, and compliance with any
provision of this Agreement may be omitted or waived, only by the written agreement of the Company
and the party that is adversely affected by such amendment or waiver.



4.3 Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, heirs, personal representatives, legal
representatives, and permitted assigns.



4.4 Severability. If any provision of this Agreement shall be declared void or
unenforceable by any judicial or administrative authority, the validity of any other provision and
of the entire Agreement shall not be affected thereby.



4.5 Headings. The headings of the various sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.



4.6 Nouns and Pronouns. Whenever the context may require, any pronouns used herein
shall include the corresponding masculine, feminine or neuter forms, and the singular form of names
and pronouns shall include the plural and vice-versa.



4.7 Further Assurances. The parties hereto agree to use their respective reasonable
best efforts to take, or cause to be taken, all action and to do, or cause to be done, all things
necessary, proper or advisable to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.



4.8 Governing Law. This Agreement shall be governed by, and construed and enforced in
accordance with, the substantive laws of the State of New Jersey, without regard to its principles
of conflicts of laws.



4.9 Counterparts. This Agreement may be executed in any number of counterparts, each
such counterpart shall be deemed to be an original instrument, and all such counterparts together
shall constitute but one agreement. Any such counterpart may contain one or more signature pages.



SIGNATURE PAGE FOLLOWS

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IN WITNESS WHEREOF, the parties have executed, or have caused
their duly authorized representative to execute, this Termination Agreement as a contract under
seal as of the date first written above.




Cornell Capital Partners, LP



	 	 	 
	By:

Its:

	 	Yorkville Advisors, LLC

General Partner
	By:

	 	/s/ Mark Angelo
	 

	 	 
	Name:

Title:

	 	Mark Angelo

Portfolio Manager






	 	 	 
	Viaspace Inc.
	By: /s/ Carl Kukkonen
	Name: Carl Kukkonen
	Title: President and Chief Executive Officer





	 	 	 
	Arroyo Sciences, Inc.
	By: /s/ Carl Kukkonen
	Name: Carl Kukkonen
	Title: Chief Executive Officer





	 	 	 
	Concentric Water Technology LLC
	By: /s/ Carl Kukkonen
	Name: Carl Kukkonen
	Title: Chief Executive Officer






	 	 	     /s/ Carl Kukkonen      

Carl Kukkonen






     /s/ Amjad Abdallat     




	 	 	Amjad Abdallat






Escrow Agent



	 	 	 	 	 
	
 
	 	By:
	 	/s/ David Gonzalez
	
 
	 	 
	 	 
	3992864v.1

	 	

Name:
	 	

David Gonzalez, Esq.
	 
	 	 	 	 







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