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RESEARCH AGREEMENT


 


Between


 


THE REGENTS OF THE UNIVERSITY OF CALIFORNIA


UNIVERSITY OF CALIFORNIA, SANTA BARBARA


 


And


 


NASCENT WATER TECHNOLOGIES, INC.


 


This Research Agreement (“Agreement”) is entered
on this 9th day of December, 2010 into by and between THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a California Constitutional
corporation, on behalf of its Santa Barbara campus, hereinafter called “University,” and, NASCENT WATER TECHNOLOGIES,
INC., a California corporation, and wholly-owned subsidiary of AcquaeBlu Corporation, a Delaware Corporation, having a principal
place of business at 430 Park Avenue, Suite 702, New York, NY 10022, hereinafter called “Sponsor.”


 


WHEREAS, University is a non-profit organization dedicated,
in part, to engaging in high quality research activities for the advancement of knowledge and benefit of the public;


 


WHEREAS, the research project contemplated by this Agreement
is of mutual interest and benefit to both the University and Sponsor, and is consistent with the research and educational objectives
of the University;


 


NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:


 





		1.	Statement of Work



  


University, through its Principal Investigator(s), shall use
reasonable efforts to perform the research activities set forth in the Statement of Work attached hereto as Exhibit A, which is
hereby incorporated in full by reference. Sponsor acknowledges and agrees that University cannot guarantee the results of any of
its research activities, and that minor deviations from the Statement of Work may occur to further the scientific goals of the
Statement of Work.


 





		2.	Deliverables



 





Deliverables under this agreement are described in and will
be submitted to Sponsor in accordance with Exhibit B hereof, which is hereby incorporated in full by reference.


 





		3.	Performance Period and Term of the Agreement



 





The Period of Performance and
the Term of this Agreement shall be from January 1, 2011 through December 31, 2014.


 





		4.	Cost to Sponsor



 





The cost to Sponsor for University’s performance hereunder
shall not exceed $[****]. This Agreement shall be performed on a “cost reimbursement” basis. When expenditures reach
this amount, Sponsor will not be required to fund and University will not be required to perform additional work hereunder unless
by mutual agreement of the parties.


 


		5.	Payment



 


Advance quarterly payment will be made to University by Sponsor
in accordance with Exhibit C hereof, which is hereby incorporated in full by reference. University will send quarterly invoices
to Sponsor. Checks shall be made payable to The Regents of the University of California and shall be sent to:


 





Cashier’s Office


SAASB Building, Room 1212


Santa Barbara, California  93106-2003










 


Payments should refer to both
the Principal Investigator’s last name and Sponsor’s name.


 


		6.	Principal Investigator



 


University’s performance hereunder will be under the direction
of Professor Arturo Keller, who will serve as Principal Investigator(s) (“Principal Investigator”). In the event that
the Principal Investigator becomes unable or unwilling to continue work under this Agreement and an alternate Principal Investigator
is not agreeable to Sponsor, Sponsor will have the option to terminate this Agreement in accordance with Article 16 hereof. The
Sponsor understands and agrees that the Principal Investigator and/or Project Director is the scientific contact for the University
but is not authorized to amend, modify or terminate the terms and conditions of this Agreement. Requests to amend, modify or terminate
the terms of this Agreement must be directed to the University’s Office of Technology & Industry Alliances and must comply
with the notice requirements of this Agreement.


 






    	 



    	 	



    
 





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		7.	Rights in Data



 


University will have the unrestricted right to publish, disclose,
disseminate and use, in whole and in part, any data or information developed by University under this Agreement or received in
the performance of this Agreement except as set forth in Article 11 (“Confidentiality”) hereof. Except as set forth
in Section 9 (“Patents and Inventions”) and Section 10 (“Copyright”), Sponsor will have the right to publish
and use any technical reports and information specified to be delivered hereunder. It is agreed, however, that under no circumstances
will Sponsor state or imply in any publication or other published announcement that University has tested, endorsed or approved
any product, service or company. Sponsor understands and agrees that such data is provided “as is” and thus, Sponsor
uses such data at its own risk. University extends no warranties of any kind, either express or implied, including, but not limited
to, warranties of merchantability and fitness for a particular purpose.


 


		8.	Supplies and Equipment



 


In the event that University purchases supplies or equipment
hereunder, title to such supplies and equipment will vest in University.


 


		9.	Patents and Inventions



 


9.1 Inventorship of patentable
developments or discoveries first conceived and actually reduced to practice in the performance of this Agreement (“Subject
Inventions”) will be determined in accordance with applicable U.S. Patent Law and University policy.


 


9.2 To the extent that University will have the legal right
to do so, and provided Sponsor pays all direct and indirect costs of the Statement of Work including a proportionate share of all
researcher salaries and benefits, Sponsor will have a time-limited first right to negotiate a license to the University’s
interest in any Subject Invention.


 


9.3 University shall promptly disclose to Sponsor any Subject
Inventions. Sponsor shall hold this disclosure on a confidential basis and will not disclose the information to any third party
without the prior written consent of University. Sponsor will notify the University in writing within thirty (30) days of notice
of such disclosure to Sponsor whether or not it wishes to secure an option or license to University’s interest in the disclosed
Subject Invention (“Election Period”). Sponsor will have ninety (90) days from the date of election to conclude such
option or license agreement with University (“Negotiation Period”). Said license will contain reasonable terms, will
require diligent performance by Sponsor for the timely commercial development and early marketing of all Subject Inventions subject
to the license, and will include Sponsor's obligation to reimburse University's patent costs for all Subject Inventions subject
to the license. In the event it is necessary in the opinion of University to file any patent applications to protect a Subject
Invention during the Election or Negotiation Periods, Sponsor will reimburse patent costs incurred by University during such period(s).
If such option or license negotiation is not concluded within the Negotiation Period or if Sponsor does not notify University of
its wish to secure an option or license within the Election Period, neither party will have any further obligation to the other
with respect to the University’s interest in the Subject Invention and the rights to such Subject Invention will be disposed
of in accordance with University’s policies.


 


9.4 Nothing in this Agreement is or shall be construed as conferring
by implication, estoppel, or otherwise any license or rights under any patents or other rights of The Regents.


 


		10.	Copyright



 


Copyright in original works of authorship, including computer
software, first created and fixed in a tangible medium of expression by University in the performance of this Agreement will vest
in University. At Sponsor’s request and to the extent that University has the legal right to do so, University will grant
to Sponsor a license to such works on reasonable terms and conditions, including reasonable royalties, as the parties mutually
agree in a separate writing.


 


		11.	Confidentiality



 


During the course of this Agreement, Sponsor may provide University
with certain proprietary business or technical information or materials (“Confidential Information”). Except as required
by law, and as long as all written disclosures of Confidential Information are clearly marked “Confidential” and all
oral disclosures of Confidential Information are both identified as confidential at the time of disclosure and are thereafter reduced
to a writing that is clearly marked “Confidential” within fourteen (14) days of such oral disclosure, University will
hold Confidential Information in confidence and agrees to prevent its disclosure to third parties using the same degree of care
that the University uses with its own information of like kind. Confidential Information shall be provided only to University’s
Principal Investigator and only on a “need to know” basis. This obligation shall continue in effect for three (3) years
after expiration or termination of the Agreement.


 






    	 



    	 	



    
 





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Information and materials disclosed by Sponsor
shall not be considered confidential which: (1) is now public knowledge or subsequently becomes such through no breach of this
Agreement; (2) is rightfully in University’s possession prior to Sponsor’s disclosure as shown by written records;
(3) is rightfully disclosed to University by a third party; or, (4) is independently developed by or for University without reliance
upon confidential information received by Sponsor.


 


Because University is a public, non-profit
educational institution and does not have identified resources to sustain liability for disclosure of information, Sponsor agrees
that no financial liability shall attach to University in the event such disclosure occurs.


 


		12.	Publication



 


University shall have the right, at its discretion, to release
any information or to publish any material resulting from its performance hereunder. University will furnish Sponsor with a copy
of any proposed written or oral publication (including manuscripts, abstracts, and oral presentations) at least thirty (30) days
prior to submission for publication (“Review Period”). Upon written notification by Sponsor within the Review Period,
University agrees to delete any of Sponsor’s Confidential Information that appears in the publication. If it is determined
that a patent application should be filed, University will delay publishing such proposed publication for a maximum of an additional
thirty (30) days in order to protect the potential patentability of any invention described therein.


 


		13.	Applicable Law



 


This Agreement will be governed by the laws of the State of
California, United States of America, without regard to the conflict of laws provisions thereof.


 


		14.	Notice



 


			Whenever any notice is to be given hereunder, it will be in writing and sent to the Authorized Representative for the receiving
party indicated below by certified mail or overnight courier, at following address:



 





		University:	Office of Technology & Industry Alliances



University of California


342 Lagoon Road


Santa Barbara, CA 93106-2055


Attn: Jill L. Boltz, Industry Contract Officer


 


		Sponsor:	Joseph Sierchio



Nascent Water Technologies, Inc.


430 Park Avenue, Suite 702


New York, NY 10022







 


		15.	Termination



 


Either University or Sponsor may terminate this Agreement by
giving sixty (60) days written notice to the other. Sponsor will pay University actual direct and indirect costs and noncancellable
commitments incurred prior to the date of termination and fair close-out related costs. If the total of such costs is less than
the total funds advanced, the balance will be returned to Sponsor.


 


		16.	Publicity



 


Neither party will use the name, trade name, trademark or other
designation of the other party in connection with any products, promotion, or advertising, without the prior written permission
of the other party. However, nothing in this Article is intended to restrict either party from disclosing the existence of and
nature of this agreement (including the name of the other party) or from including the existence of and nature of this agreement
in the routine reporting of its activities.


 


		17.	Indemnification



 


Sponsor shall defend, indemnify, and hold University, its officers,
employees, and agents harmless from and against any and all liability, loss, expense (including reasonable attorney's fees), or
claims for injury or damages arising out of its performance of this Agreement but only in proportion to and to the extent such
liability, loss, expense, attorney's fees, or claims for injury or damages are caused by or result from the negligent or intentional
acts or omissions of Sponsor, its officers, agents, or employees.


 


University shall defend, indemnify, and hold Sponsor, its officers,
employees, and agents harmless from and against any and all liability, loss, expense (including reasonable attorney's fees), or
claims for injury or damages arising out of its performance of this Agreement but only in proportion to and to the extent such
liability, loss, expense, attorney's fees, or claims for injury or damages are caused by or result from the negligent or intentional
acts or omissions of University, its officers, agents, or employees.


 


This section shall survive the termination or expiration of
this Agreement.


  



    	 



    	 	



    






 


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		18.	Excusable Delays



  


University will be excused from performance hereunder if a delay
is caused by inclement weather, fire, flood, strike, or other labor dispute, acts of God, acts of governmental officials or agencies,
terrorism, or any other cause beyond the control of University. The excusable delay is allowed for the period of time affected
by the delay. If a delay occurs, the parties will revise the performance period or other provisions hereunder as appropriate.


 


		19.	Assignment



 


Neither party will assign its rights or duties under this Agreement
to another without the prior express written consent of the other party; provided, however, that Sponsor may assign this Agreement
to a successor in ownership of all or substantially all its business assets in the field to which this Agreement relates if such
successor will expressly assume in writing the obligation to perform in accordance with the terms and conditions of this Agreement.
Any other purported assignment will be void.


 


		20.	Amendments



 


No agreements, modifications, or waivers to this Agreement shall
be valid unless in writing and signed by the Authorized Representatives of the parties.


 


		21.	Miscellaneous



 


21.1 Not a Partnership or Joint Venture. It is understood
and agreed by the parties that the University is performing this contract as an independent contractor. The parties, by this Agreement,
do not intend to create a partnership, principal/agent, master/servant, or joint venture relationship and nothing in this Agreement
shall be construed as creating such a relationship between the parties.


 


21.2 Severability. If any term or provision of this Agreement
shall be held to be invalid or illegal, such term or provision shall not affect the validity or enforceability of the remaining
terms and provisions of this Agreement.


 


21.3 Recitals & Headings. The recitals herein constitute
an integral part of the Agreement reached and are to be considered as such. However, the captions and headings contained in this
Agreement have been inserted for reference and convenience only and in no way define, limit, or describe the text of this Agreement
or the intent of any provision.


 


21.4 No Waiver. The wavier by either party of a breach
or default of any provision of this Agreement shall not constitute a waiver of any succeeding breach, nor shall any delay or omission
on the part of either party to exercise any right that it has under this Agreement operate as a waiver of such right, unless the
terms of this Agreement sets forth a specific time limit for the exercise thereof.


 


		22.	Entire Agreement



 


This Agreement, and Exhibits A through C, constitute the entire
agreement and understanding between the parties and supersedes all previous agreements and understandings on the subject matter
of this Agreement, if any.


 


	 	 	 	 	THE REGENTS OF THE UNIVERSITY OF CALIFORNIA	 
	 	 	 	 	 	 
	By:		 	By:		 
	By:	 	 	By:	Jill L. Boltz	 
	Title:	 	 	Title:	Industry Contracts Officer	 
	Date:	 	 	Date:	 	 


 


EXHIBIT A


Statement
of Work


 


 


EXHIBIT B


Deliverables


 


University shall provide Sponsor with a final technical report
within ninety (90) days after the end date of this Agreement.


 


 


EXHIBIT C


Payment Schedule


 


Sponsor shall send advanced, quarterly payments.
The first payment will be made within 30 days of signature.