Blueprint





 





 



Exhibit 10.60


 






BRIDGE LOAN AGREEMENT


 





This Loan Agreement (the "Loan Agreement")
is made as of
________________________, by and
between ___________________________________________(the
"Lender")
and Ocean Thermal Energy Corporation
(the "Borrower").

 



WITNESSETH:


 





WHEREAS, the Borrower
desires to obtain certain credit facilities, as set forth in this
Loan Agreement,
and the Lender is willing to provide
such credit facilities on the terms and conditions set forth
herein;


 


NOW,
THEREFORE, the Lender and the
Borrower, intending to be legally bound, hereby agree
as follows:


 





1. The Credit
Facilities. The Lender
agrees, pursuant to the terms and conditions of this Loan
Agreement and the other Loan Documents (as defined
below), to make a loan to the Borrower in the original
principal amount of up to ____________________________Dollars
($____________) (the "Loan"), with the specific amount to be determined at its
sole discretion of the Lender. The Loan shall be evidenced by a
Note (the "Note") and shall be made in accordance with and subject
to the terms and conditions of this Loan Agreement, the Note and
the other Loan Documents.


 





2. The Loan
Documents. The following documents and materials (together
with this Loan Agreement and any other accessory documents executed
in connection herewith, such documents and materials, as they may
be amended, restated,
renewed and
extended, are collectively referred to herein as the
"Loan
Documents") have been or will be executed in connection with
the Loan:

 


a. Note;
and,


 


b. A
warrant, of even date herewith, granting to
Lender the right to acquire shares of Ocean Thermal
Energy Corporation common stock, calculated
at a 15% discount the Borrower’s common shares on the day
prior to Lender exercising the warrant.


 


3. Interest
Rate. The Loan shall bear interest as set forth in the
Note.


 





4. Repayment.
Repayment of the Loan shall be made as
set forth in the Note, and pre­ payment shall be permitted as
therein specified.

 





5. Use
of Proceeds.
The proceeds of the Loan shall be used
to finance Borrower’s acquisition costs for a
revenue-producing Ocean Thermal Energy Conversion
(“OTEC”) and Seawater Air Conditioning
(“SWAC”) engineering company with patented technology,
contracts including two large OTEC contracts worth more than $75
million to the Company, and several technology contracts with
tier-1 oil and gas companies.


 





6. Security.
The Loan will be
unsecured.


 




 

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7. Expenses and
Fees. The Borrower agrees to
pay the Lender for
all reasonable out-of­ pocket expenses of every nature related to their
respective credit facilities, including, but not limited to,
attorneys' fees (not to exceed $5,000) and
out-of-pocket expenses which the Lender may
incur in connection with the execution or carrying out of this Loan
Agreement and the other Loan Documents, or its rights
hereunder and thereunder, and the Lender may pay any
or all such expenses
and add the amount thereof to the indebtedness secured or assured
pursuant to the Loan Documents.

 


8. Representations and
Warranties. The Borrower, in
order to induce the Lender to make the Loan, makes the following
representations, warranties and promises:

 


a. Good
Standing. The Borrower is a
corporation, duly organized, validly
existing and in good standing under the laws of the
state of its incorporation, with powers adequate to own
its properties,
and to carry on its business as presently conducted by
it.


 





b. Authority; Binding
Agreement. The execution,
delivery and performance of
the Loan Documents are within
the corporate power of the Borrower, have been duly authorized by
the Borrower and are not in contravention of law or the
terms of the Borrower's Articles of Incorporation and
By-Laws. The execution, delivery and performance of the Loan
Documents does not and will not
contravene any documents, agreements or
undertakings to which the Borrower is a party or by which
the Borrower is bound. No approval of
any person, corporation,
governmental body or other
entity is a prerequisite to the execution, delivery,
validity or enforceability
and performance of the Loan
Documents. When executed by the Borrower, the Loan
Documents to which
the Borrower is a party will
constitute the legally binding obligations of the
Borrower, enforceable in accordance with their terms except as the
enforceability may be limited by bankruptcy, insolvency or
other similar
laws affecting the enforcement of
creditors' rights
generally.

 


c. Financial
Information. Subject to any
limitation stated
therein or in connection therewith,
all balance sheets, earning statements, accounts receivable lists
and aging schedules and other financial data which have been or
shall be furnished to the Lender by the Borrower to
induce the Lender
to enter into this Loan Agreement or
otherwise in connection herewith, do or will fairly represent the
financial condition of the Borrower in all material respects, are
accurate, complete and correct in all material respects
insofar as completeness may be necessary to give the Lender a
true and accurate knowledge of the
subject matter as of the date hereof. There are no
material liabilities, direct or indirect, fixed
or contingent, of the Borrower as of the date of
such financial
statements which are not
reflected therein or in the notes thereto.
There has been no material adverse change
in the financial condition or operations of the Borrower since the
date of said
financial statements or since the respective dates on which the
Borrower furnished the Lender with other financial data
or other representations about their financial
condition.

 


d. Solvency.
Any borrowings to be made by Borrower
under this Loan Agreement do not and will not render Borrower
insolvent. The Borrower is not contemplating either the filing of a
petition under any state or federal bankruptcy or insolvency laws,
or the liquidation of all or a major portion of its property, and
the Borrower has no knowledge or any reason to know of any person
contemplating the filing of any such petition against
it.


 




 

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9. Covenants.
The Borrower agrees with the Lender
that during the term of this Agreement and the other Loan
Documents, and any extensions, replacements
or renewals thereof (except as otherwise agreed by the Lender in
writing):


 





a. Insurance.
The Borrower shall maintain adequate
fire and extended coverage insurance, with the Lender named as
lender loss payee, as well as general liability, business
interruption and other insurance policies as are customary. All
such insurance:


 


i. Shall
be issued in such amounts and by such companies as are satisfactory
to the Lender; and


   



ii. Shall
contain provisions providing for thirty (30) days' prior written
notice to the Lender of any intended change or cancellation and
providing that no such change or cancellation shall be effective as
to the Lender in the absence of such notice.

 


b. Notice of
Default; Litigation.
The Borrower shall notify the Lender
in writing immediately upon becoming aware of any default
hereunder, or of any actions, suits, investigations, or
proceedings at law,
in equity or before any governmental
authority that may have a material adverse effect on such Borrower,
pending or threatened, against or affecting the Borrower or
involving the validity or enforceability of the Loan
Documents.


 





c. Financial
Information.
At the request of Lender, the Borrower
shall furnish or cause to be furnished to the Lender (i) on an
annual basis,
federal income tax returns of the
Borrower and annual financial statements of the Borrower, compiled
by certified public accountants, within one
hundred twenty (120) days after the end of each fiscal year; and
(ii) on a fiscal quarter basis, internally-prepared interim
financial statements of the Borrower in a form satisfactory to
Lender within thirty (30) days of the close of each fiscal quarter.
For the sake of clarity, required public filings of
Borrower’s financial information shall be deemed to satisfy
the obligation of the Borrower under this
provision.


 





d. Expenses.
The Borrower shall pay all costs and
expenses (including,
but not limited to, attorneys' fees)
incidental to the Loan and to
the collection of all obligations pursuant to the Loan
Documents.


 





e. Deposit
Relationship.
The Borrower shall establish and
maintain their primary deposit relationship with a bank reasonably
acceptable to the Lender.

 





f. Further
Assurances. The Borrower shall
execute such documents as the Lender may reasonably request
relating to the Loan.

 


g. Nature of
Business. The Borrower shall
not enter into any type of business other than that in
which it is presently engaged, or
otherwise significantly
change the scope or
nature of its business.

 





h. Mergers,
Etc. The Borrower
shall not wind up, liquidate or dissolve, reorganize, merge or
consolidate with
or into,
or convey, sell, assign,
transfer, lease, or otherwise dispose of (whether in one transaction or in
a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to
any person, or acquire all or substantially all of the assets or the
business of any
person.


 







 

3








 











i. Sale
of Assets, Etc.
The Borrower shall not
sell, lease, assign, transfer, or otherwise dispose of
any of its now owned or hereafter acquired
assets, except: (1) inventory disposed of in the ordinary course of business;
and (2) the sale
or other disposition of assets no
longer used or useful in the conduct of its
business.


 





j. Additional
Borrowings. Borrower shall not
create, incur, assume,
or suffer to
exist, any indebtedness, except: (i) borrowings pursuant
to this Agreement or other agreements with other lenders that
substantially conform to the attached Term Sheet; (ii) unsecured
trade credit incurred in the ordinary course of business which are
paid in a timely manner; (iii) other obligations to the
Lender; and
(iv) borrowings used to prepay in full the Borrower's
obligations under the Loan Documents, including project
revenue.


 





k. Guaranties,
Etc. The Borrower shall not
assume, guaranty,
endorse, or otherwise be or become
directly or contingently responsible or liable (including, but
not limited to, an agreement to purchase any obligation, stock,
assets, goods, or services, or to supply or advance any funds,
assets, goods, or services, or an
agreement to maintain or cause such person to
maintain a minimum working capital or net worth,
or otherwise to
assure the creditors of any person against loss) for obligations of
any person, except (i) guaranties by endorsement of
negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business
and (ii) guaranties
in favor of the
Lender.

 


1. Liens,
Etc. Borrower
shall not create, incur , assume or
suffer to exist, any mortgage, security interest, pledge, lien, charge or
other encumbrance of any nature whatsoever on any of their
respective assets,
now or hereafter owned, other than (i)
liens in favor of the Lender; (ii) liens under workmen's
compensation, unemployment insurance and social security or similar laws;
and (iii) liens imposed by law, such
as carriers, warehousemen's or
mechanic's liens,
incurred in good faith
in the ordinary course of business which are not
past due for more than thirty (30) days (other than to the extent a
longer period is permitted by their creditors in the ordinary
course of business) or
which are being contested in good
faith by appropriate proceedings, a stay of
execution having been served.

 





m. Loan and
Advances. The Borrower shall
not make any additional loans or advances to any
individual, firm or
corporation.

 





10. Conditions
Precedent. The obligation of
the Lender to make the Loan is subject to the satisfaction by the
Borrower of the following conditions precedent:


 





a. The
Borrower' s representations and warranties as contained
herein shall be accurate and complete as of the date of
closing;


 





b. The
Borrower shall not be in default under any of the covenants
contained herein as of the date of closing;


 





c. The
Borrower shall have executed and delivered all of the Loan
Documents to which they are parties;


 





d. The
Borrower shall have delivered to the Lender all of the documents
(fully executed) and materials and satisfied all of the
requirements reasonably requested by Lender to evidence the
obligations of Borrower with respect to the Loan in such form and
substance as may be reasonably acceptable to the
Lender.


 




 

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e. The
Borrower shall provide the Lender with confirmation that there are
no known disputes or pending actions between such Borrower and the
Internal Revenue Service.


 





f. The
Borrower shall furnish the Lender with such other
documents, opinions, certificates, evidence
and other matters as may be reasonably requested by the Lender at
or prior to closing.

 





11. Events of Default;
Acceleration; Remedies. The
occurrence of any one or more of the following events shall
constitute a default (an "Event of
Default") under this Agreement:


 





a. If any
statement, representation or warranty made by the Borrower in the
Loan Documents, in connection therewith or any financial
statement, report, schedule, or certificate furnished to the
Lender by the Borrower, any of its
representatives,
employees or accountants during the
term of this Agreement shall prove to have been false or misleading
when made, or subsequently becomes false or misleading, in
any material respect;


 





b. Default by the Borrower in payment within five (5)
days of the due date of any principal or
interest or other amounts called for under the Loan
Documents;

 





c. Default by the Borrower in the performance or
observance of any of its respective obligations under the
provisions, terms, conditions, warranties
or covenants of the Loan Documents and such failure shall continue
for a period of thirty (30) days or more following receipt of
written notice thereof from the Lender.

 





d. The
occurrence of an event of default not cured within
any applicable remedy period, under any
obligations of the Borrower to the Lender other than under the
Loan Documents, whether created prior to, concurrent
with, or subsequent to obligations arising out of the Loan
Documents;

 





e. The
occurrence of an event of default not cured within any applicable
remedy period, under any other obligation of the Borrower in an
aggregate amount of Ten Thousand Dollars ($10,000.00) or more, for
borrowed money or under any lease;


 





f. The
dissolution, termination of existence, merger or consolidation of
the Borrower,
or a sale of all or substantially all
of the assets of the Borrower out of the ordinary course of
business;


 


g. A
change in the beneficial ownership of fifty percent (50%) or more
(in the aggregate) of the issued and outstanding voting capital
stock of the Borrower from the ownership on the date of this Loan
Agreement, whether through transfer, issuance of stock or
membership interests or otherwise.

 


h. The
Borrower shall (i) apply for or consent to the appointment of a
receiver, trustee or liquidator of any of their or its property,
(ii) admit in writing their or its inability to pay their or its
debts as they mature, (iii) make a general assignment for the
benefit of creditors, (iv) be adjudicated a bankrupt or
insolvent, (v) file a voluntary petition in
bankruptcy, or a petition or an answer seeking reorganization
to take advantage of any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation
law or statute, or an answer admitting the material allegations of
a petition filed against it or he in any proceeding under any such
law or (vi) offer or enter into any compromise, extension or
arrangement seeking relief or extension of their or its
debts;


 




 

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i. In the
event that proceedings shall be commenced or an
order, judgment or decree shall be entered against the
Borrower, without the application, approval or
consent of such Borrower (as the case may be) in or by any court of
competent jurisdiction,
relating to the
bankruptcy, dissolution, liquidation,
reorganization or the appointment of a
receiver, trustee or liquidator of such Borrower of all or a
substantial part of their or its assets, and such proceedings,
order, judgment or decree shall continue undischarged or unstayed
for a period of 90 days;

 


j. A
final and unappealable judgment for the payment of money in excess
of Ten Thousand Dollars ($10,000.00) shall be
rendered against the Borrower and the same shall remain
undischarged for a period of 60 days, during which
period execution shall not be effectively stayed;
or


 





Upon the occurrence of any Event of
Default, automatically upon an Event of Default under
subsection (h) or (i) of this Section or otherwise at the election
of the Lender, (i) all of the obligations of the Borrower to the
Lender, either under this Loan Agreement or
otherwise, will immediately become due and payable without
further demand, notice or protest, all
of which are hereby expressly
waived; (ii) the Lender may proceed to protect and enforce
its rights, at law, in equity, or otherwise, against
the Borrower and may proceed to liquidate and realize upon any of
its collateral in accordance with the rights of a mortgagee or a
secured pai1y under the Uniform Commercial Code, any other
applicable law,
any Loan Document, any agreement
between the Borrower and the Lender; and/or (iii) the
Lender's commitment to make further loans under this Agreement or
any other agreement with the Borrower will
immediately cease and terminate.

 





12. General
Provisions. The Lender and the
Borrower agree as follows with respect to the Loan
Documents:


 





a. Waivers.


 





i. The
Borrower hereby waives,
to the fullest extent permitted by
law, presentment,
notice, protest and
all other demands and notices of any description and assent (1) to
any extension of the time of payment or any other
indulgence, (2) to any substitution, exchange or release of
collateral, and (3) to the release of any
other person primarily or secondarily liable for the obligations
evidenced hereby.

 





ii. No
delay or omission on the part of the Lender in exercising any
right, privilege or remedy hereunder shall operate as a waiver of
such right, privilege or remedy or of any other right,
privilege or remedy under the Loan Documents. No waiver of any
right, privilege or remedy or any amendment to the Loan Documents
shall be effective unless made in writing and signed by the Lender.
A waiver on any one occasion shall not be construed as a bar to or
waiver of any such right, privilege
and/or remedy on any future occasion. No single
or partial exercise of any power hereunder shall
preclude other or future exercise thereof or the exercise of any
other right. The acceptance by the Lender of any payment after any
default under the Loan Documents shall not operate to extend the
time of payment of any amount then remaining unpaid hereunder or
constitute a waiver of any rights of the Lender hereof under the
Loan Documents.


 





b. Binding
Agreement. The Loan Documents
shall inure to the benefit of and shall be binding upon the parties
hereto and their respective heirs, legal
representatives,
successors, and
assigns;


 




 

6








 






   



c. Entire Agreement and
Amendment. The Loan Documents
constitute the entire agreement between the Lender and the Borrower
with respect to the Loan and shall not be changed in any respect
except by written instrument signed by the parties
thereto;


 





d. Governing
Law. The Loan Documents and all
rights and obligations thereunder, including
matters of construction,
validity, and
performance, shall be governed by the laws of the Commonwealth of
Pennsylvania;

 





e. Severability.
If any term,
condition, or provision of the Loan Documents or the
application thereof to any person or circumstance
shall, to any extent, be held
invalid or unenforceable according to law, then the
remaining terms,
conditions, and
provisions of the Loan Documents, or the
application of any such invalid or unenforceable term, condition or
provision to persons or circumstances other than those to which it
is held invalid or unenforceable, shall not be
affected thereby, and
each term, condition, and provision of
the Loan Documents shall be valid and enforced to
the fullest extent permitted by law;

 





f. Notice. Any
demand or notice required or permitted under the Loan
Documents shall be effective if either: (i) hand-delivered to the
addressee, or (ii) deposited in the mail,
registered or certified, return receipt requested and postage
prepaid, or delivered to a private express company addressed to
the addressee:
(A) at the address
shown below, or
(B) if such party has provided the other in writing
with a change
of address, at the last
address so provided. Any notice or demand mailed as provided
in this paragraph shall
be deemed given and received on the
earlier of: (i) the date received; (ii) or the date of
delivery, refusal or non-delivery as indicated on the return
receipt, if sent
by mail or private express as
provided above.


 





	
Borrower:

	
 

	
Lender:

	
 

	
 


	
Ocean
Thermal Energy Corporation

	
 

	
 

	
 

	
 


	
800
South Queen Street Lancaster, PA 17603

	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
 

	
 


	
With a copy to:

	
 

	
 

	
 

	
 


	
Gerald
Koenig, Esq.


	
 

	
With
copy to:

	
 

	
 


	
8220 Crestwood Heights Drive, #1105

	
 

	
 

	
 

	
 


	
McLean,
VA 22102

	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
 

	
 






  






 

7








 





 


g. Conflict
Among
Loan
Documents. In the event of any
conflict between the terms, covenants, conditions and restrictions
contained in the Loan Documents, the term, covenant and condition
or restriction which grants the greater benefit upon the Lender shall control. The
determination as to which term, covenant, condition or restriction
is the more beneficial shall be made
by the Lender in its sole
discretion.


 





h. Costs of
Collection. The Borrower agree
to pay on demand all reasonable out­ of-pocket costs of
collection under the Loan Documents, including reasonable
attorneys' fees, whether or not any foreclosure or other action
is instituted
by the Lender in its
discretion.


 





i. Set-Off,
Etc. As
additional collateral, the
Borrower grants (1) a security
interest in, or pledges, assigns and delivers, to the
Lender, as appropriate, all deposits, credits and
other property now or hereafter due from the Lender to
the Borrower and (2) the right to set-off and
apply (and a security
interest in said right), from time to
time hereafter and without demand or notice of any nature, all, or
any portion, of such deposits, credits and other property, against the
indebtedness evidenced by any of the Notes, whether the
other collateral, if
any, is deemed adequate or not.

 


j. Rights
Cumulative. All rights and
remedies of the Lender, whether granted herein or otherwise, shall
be cumulative and may be exercised singularly or
concurrently,
and the Lender shall
have, in addition to all other rights and remedies, the
rights and remedies of a secured party under the Uniform Commercial
Code of Pennsylvania. Except as otherwise provided by
law, the Lender shall have no duty as to the collection
or protection of the collateral or of any income
thereon, or as to the preservation of any rights pertaining
thereto beyond the safe custody thereof.

 






IN WITNESS WHEREOF, the Borrower and the Lender have executed this
Loan Agreement as of the date indicated above.

 






OCEAN THERMAL ENERGY CORPORATION


   



By:
______________________________________


Name:
Jeremy P Feakins


Title:
Chairman and CEO


 




 



LENDER:

 


By:
_______________________________________

 


Name:
____________________________

 


Title:
_______________________________

 


Address:
___________________________

 


___________________________________

 


Phone Number:
____________________

 


Email
address: _____________________


 




 

8








 





 



WARRANT


 






to Purchase up to _____________ Shares of Common Stock



$ - 0 -
Par Value Per Share, of

 



OCEAN THERMAL ENERGY CORPORATION


 





This is to certify that, for value received,
_____________________________ ("Lender") or any permitted transferee (Lender or such
transferee being hereinafter called the "Holder") is entitled to purchase, subject
to the provisions of this Warrant,
from Ocean Thermal Energy Corporation, a Nevada
corporation ("OTEC"), at any time on or after the date
hereof, an aggregate of up to __________________ fully
paid and non-assessable shares of common stock, $
-0- par value (the "Common Stock"), of OTEC at a price per share equal
to a 15% discount from the price of the Common Stock
on the last trading day before such purchase, subject to
adjustment as herein provided (the "Exercise
Price").

 


1. Exercise of
Warrant. Subject
to the provisions hereof,
this Warrant may be
exercised, in whole or in part, or sold,
assigned or transferred at any time or from time to time on or
after the date hereof.
This Warrant shall be exercised by
presentation and surrender hereof to OTEC
at the principal office of OTEC, accompanied by (i) a written
notice of exercise,
(ii) payment to OTEC,
for the account of OTEC, of
the Exercise Price for the number of shares of Common
Stock specified in such notice, and
(iii) a certificate of the Holder
specifying the
event or events which
have occurred and entitle the Holder to exercise this Warrant.
The Exercise Price for the number of
shares of Common Stock specified in the
notice shall be payable in immediately available funds or
in the form of an offset to amount owed by OTEC to
Lender.

 


 


Upon such presentation and
surrender, OTEC shall issue promptly (and within
one business day if
reasonably requested by
the Holder) to the Holder or
its assignee, transferee
or designee the number
of shares of Common Stock to which the Holder is
entitled hereunder.
OTEC covenants and warrants
that such shares of Common Stock, when so
issued, will be duly authorized, validly issued, fully
paid and non-assessable, and free and clear of all
liens and
encumbrances.

 


If this Warrant is exercised in part
only, OTEC shall, upon surrender of this Warrant for
cancellation, execute and deliver a new Warrant evidencing the
rights of the Holder thereof to purchase the balance of the
shares of Common Stock issuable hereunder. Upon receipt by OTEC of
this Warrant, in proper
form for exercise, the Holder shall be
deemed to be the
holder of record of the shares of
Common Stock issuable
upon such exercise,
notwithstanding that the
stock transfer books of OTEC may
then be closed or that certificates representing such shares of Common
Stock shall not then be actually delivered to the Holder. OTEC
shall pay all expenses, and any and
all United States federal, state and local taxes and other charges,
that may be payable in connection with the
preparation,
issuance and delivery of stock
certificates pursuant to this
Paragraph 1 in
the name of the Holder or
its assignee, transferee or
designee.


 




 

9








 





 


2. Reservation of Shares;
Preservation of Rights of Holder.


 





OTEC shall at all
times while this Warrant is outstanding and
unexercised, maintain and reserve, free from
preemptive rights, such number of authorized but unissued shares of
Common Stock as may be necessary so that this Warrant
may be exercised without any additional authorization
of Common Stock after giving effect to all other options,
warrants, convertible securities and
other rights to acquire shares of Common Stock at the time
outstanding. OTEC further agrees that (i) it will
not, by charter amendment or through reorganization,
consolidation,
merger, dissolution or sale of
assets, or by any other voluntary act or
omission, avoid or seek to avoid the observance
or performance of any of the
covenants, stipulations or conditions to be observed or performed
hereunder, and (ii) it will
promptly take all
action reasonably necessary to
protect the rights of the Holder as provided
herein.


 





3. Fractional
Shares. OTEC shall not be
required to issue any fractional shares of
Common Stock upon exercise of
this Warrant. In lieu of any fractional shares, the
Holder shall
be entitled to receive
an amount in cash equal to the amount of such
fraction multiplied by the Exercise Price.

 


4. Exchange
or
Loss of
Warrant. This Warrant is
exchangeable,
without expense, at the
option of the Holder, upon presentation and surrender hereof at the principal office of OTEC for other
warrants of different denominations entitling the
Holder to purchase, in the aggregate, the same
number of shares of Common Stock issuable hereunder. The
term " Warrant" as used herein includes any warrants for
which this Warrant may be exchanged. Upon receipt
by OTEC of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if
mutilated, OTEC will execute and deliver a new Warrant
of like tenor and date.

 


5. Adjustment.
The number of shares of Common Stock
issuable upon the exercise of this
Warrant and the Exercise
Price shall be subject to adjustment
from time to time as provided in this Paragraph.


 





(A) Stock Dividends,
etc.

 





(1) Stock
Dividends. In case OTEC shall
pay or make a dividend or other distribution on
any class of capital stock of OTEC payable in Common Stock,
the number of shares
of Common Stock issuable upon exercise
of this Warrant shall be increased by multiplying
such number of shares by a fraction of
which the denominator shall be the
number of shares
of Common Stock outstanding at the
close of business on the day immediately preceding the
date of such distribution and the numerator shall be the sum of such number of shares and the total
number of shares of Common Stock constituting such dividend or
other distribution,
such increase to become effective
immediately after the opening of business on the day
following such
distribution.

 





(2) Subdivisions.
In case outstanding
shares of Common Stock shall be
subdivided into a
greater number of shares
of Common Stock,
the number of shares of Common Stock
issuable upon exercise of
this Warrant
at the opening of business on the day following the
day upon which
such subdivision becomes effective shall be
proportionately increased, and, conversely, in
case outstanding shares
of Common Stock shall each be
combined into a smaller
number of shares of
Common Stock, the number of shares of
Common Stock issuable
upon exercise of this Warrant
at the opening of business on the day following the
day upon which such combination becomes effective shall be
proportionately decreased, such increase
or decrease,
as the case may be, to become
effective immediately
after the opening of business on the
day following the date upon which such subdivision or
combination becomes effective.


 




 

10








 





  





(3) Reclassifications.
The reclassification of
Common Stock into securities (other than
Common Stock) and/or
cash and/or other
consideration shall be deemed to
involve a subdivision
or combination, as the
case may be, of the number of shares of Common Stock outstanding immediately prior
to such reclassification into the number or amount
of securities
and/or cash and/or
other consideration outstanding immediately thereafter
and the effective date of such reclassification shall be deemed to
be "the day upon which such subdivision becomes effective," or "the day upon
which such combination becomes effective," as the case
may be, within the meaning of clause (2) above.


 





(4) Optional
Adjustments. OTEC may
make such increases in the number of shares of
Common Stock issuable upon exercise of this
Warrant, in addition to those required by this
subparagraph (A), as shall be
determined by its Board of Directors to be advisable in order to
avoid taxation so far as practicable of any dividend of stock
or stock rights or any
event treated as
such for federal income tax
purposes to the recipients.

 





(5) Adjustment to
Exercise
Price.
Whenever the number of
shares of Common Stock issuable upon exercise of this Warrant is
adjusted as provided in this Paragraph
5(A), the Exercise Price shall be
adjusted by a
fraction in which the numerator
is equal to the number of shares
of Common Stock issuable prior to the adjustment and the
denominator is equal to the number of shares of Common Stock
issuable after
the adjustment, rounded to the nearest cent.

 





6. Right
of the
Holder.

 


(A) Without limiting the foregoing or any remedies
available to the Holder, it is specifically acknowledged that the
Holder would not have an adequate remedy at law for any breach of
the provisions of this Warrant and shall be entitled to specific
performance of OTEC' s
obligations under, and injunctive relief against any actual or
threatened violation of the obligations of any person subject
to, this Warrant.


 





(B) The
Holder shall not, by its status as Holder, be entitled
to any rights of a stockholder in OTEC.

 


7. Termination.
This Warrant and the rights conferred
hereby shall terminate on December 31, 2020.

 


8. Goyerning
Law. This Warrant shall be deemed to
have been delivered in,
and shall be governed by and
interpreted in accordance with the substantive laws of, the
Commonwealth of Pennsylvania, except to the extent that Nevada law
may govern certain aspects of this Warrant as it relates to
OTEC.

 




 


Dated:
_______________________


 


 OCEAN
THERMAL ENERGY CORPORATION


   



By:
____________________________

 


Name: Jeremy Feakins Title: CEO


 




 

11








 





 



PROMISSORY NOTE


 


	
 $____________

	
 Date:__________________






 

FOR VALUE RECEIVED, Ocean Thermal Energy Corporation, a
Nevada corporation
with an address of 800 South Queen
Street, Lancaster,
PA 17603 (the "Borrower"),
hereby promises to pay to the
order of ____________________________________(the
"Lender"),
at 800 South Queen Street,
Lancaster, PA 17603, or
at any other place
designated to the Borrower by the Lender in writing, the
principal sum
of ___________________ Dollars
($______________), with interest
as herein specified, and
under the terms and
conditions stated
herein.


 





1. Repayment
of
Principal
and Interest. Principal
and interest shall
be repaid by Borrower to
Lender as follows: The
Borrower shall
repay the principal amount of
$_____________________
on the earlier of (i)
July 30, 2019, or (ii) any time after October 31st,
2018, if the Lender demands early repayment  (the "Maturity Date"), the Borrower shall pay to
the Lender the unpaid principal balance of the Loan, all
accrued and unpaid interest thereon, and all
other costs and amounts payable to the Lender hereunder. Prior to the Maturity Date,
interest-only payments made quarterly in arrears, commencing on May
15, 2018.


 





All amounts payable hereunder are payable in
lawful money of the United States
of America at
the address of the
Lender set forth
above in immediately
available funds. Prior to a Default, all payments
shall be applied first on account of other charges,
second to accrued interest due on the unpaid balance of
principal and finally the remainder of such payments shall be
applied to unpaid principal. If a Default
occurs, payments and monies received may
be applied in any
manner and order deemed appropriate by
the Lender.


 





2. Rates and Calculation
of lnterest. Interest on
the outstanding
and unpaid principal balance of
the Loan shall
be calculated for the actual number of
days in the then current
calendar year that
principal is
outstanding, based upon
a year of three hundred sixty (360) days, accrue and shall be paid at
the fixed rate of interest per annum
equal to ten percent (10%).


 





In no event shall
the rate of interest hereunder be in excess of the
maximum amount permitted by law. In the event the rate of interest
hereunder is determined to be in excess of the maximum amount
permitted by law, such
interest rate shall be
automatically decreased to the maximum rate permitted by
law.


 





In addition to all other rights
contained in this Note, if
a Default (defined herein) occurs and as
long as a Default
continues, all outstanding sums hereunder
shall bear interest at
the interest rate otherwise prevailing under the preceding paragraph, plus
10% (the "Default Rate"). The Default Rate shall also apply from acceleration until all unpaid
sums and obligations (whether matured or
contingent) hereunder and any
judgments thereon are
paid in
full.


 





3. Prepayment.
This Note may be
prepaid in whole or in part at any time at the option of the
Borrower without
premium or penalty.
Each prepayment shall be
applied first
to the payment in full of other
charges payable hereunder, then to accrued interest and the
remainder of such payment, if any, shall be
applied to the reduction of the unpaid
principal balance. The Lender may demand early repayment any time
after October 31st,
2018.

 





4. Loan Agreement.
This Note is the Note referred to in
the agreements between the Borrower and the Lender, including, but
not limited to the Loan Agreement of even date herewith (the
"Loan Agreement") and the Loan Documents referenced
therein (the "Loan Documents").
The failure of the Borrower to execute
any such agreement or other document shall not affect the validity
of this Note.
This Note shall evidence all
obligations of the Borrower to the Lender under
the Loan Agreement and Loan Documents.


 




 

12








 





   



5. Integration.
The terms and conditions of this
Note, together with the terms and conditions of the Loan
Agreement and the Loan Documents, contains the
entire understanding between the Borrower and the Lender with
respect to the indebtedness evidenced hereby. Such understanding
may not be amended,
modified, or terminated except in
writing duly executed by the parties hereto.

 





6. Security.
This Note is unsecured.


 





7. Default and
Remedies. The occurrence of any
default or event of default ("Default”,)
as defined in the Loan Agreement
and/or the Loan Documents, shall
constitute a Default of and under this Note.


 





When a Default occurs, the
Lender, at its option, may declare
the entire unpaid balance of principal of this Note, unpaid
interest thereon and all other charges, costs and
expenses provided for herein, in the Loan
Agreement and/or any of the
Loan Documents, and/or pursuant
to any other agreements between Borrower and
Lender, immediately due and payable without notice to or
demand upon the Borrower. Upon the occurrence of a
Default, the Lender shall have all of the rights and
remedies with respect the Loan Agreement, the Loan
Documents, this Note, and/or
otherwise provided for by law, in
equity, and otherwise.


 





8. Waiver.
The undersigned hereby waives
presentment for payment, demand, notice of
nonpayment, notice of protest, and protest
of this Note, and all of the notices in connection with
delivery, acceptance, performance, default, or
enforcement of the payment of this Note. The failure
by the Lender to exercise any right or remedy shall not be taken to
waive the exercise of the same thereafter for the same or any
subsequent Default. The Borrower waives any claim of
set-off, recoupment and/or
counterclaim. All notices to the Borrower shall be adequately given
if mailed postage prepaid to the address appearing in the
Lender' s records. The
Borrower intends this Note to be a sealed instrument and to be
legally bound hereby.


 





9. Holder. The
references to "Lender"
herein shall be deemed to be references to any subsequent
assignee, transferee, or other holder of this Note.
Notwithstanding anything to the contrary herein, this Note shall be
nontransferable, except by operation of law.


 


10. Governing
Law. This Note shall be
construed in accordance with the domestic internal laws of the
Commonwealth of Pennsylvania, without reference to any conflict of
laws provisions, as a Note made, delivered
and to be wholly performed within the Commonwealth of
Pennsy1vnia.


 





11. Judicial Proceedings.
Any suit, action, or
proceeding, whether claim or counterclaim, brought or
instituted by the Borrower or the Lender, or any of
their successors or assigns, on or with respect to this Note or the
dealings of the Borrower or the Lender with respect hereto, shall
be tried only by a court and not by a jury. THE BORROWER HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT TO
A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING. In connection therewith, the Borrower
agrees that any suit, action or proceeding arising hereunder or
with respect hereto will
be instituted in the Court of
Common Pleas of York County, Pennsylvania, or the
United States District Court for the
Middle District of Pennsylvania, and irrevocably and
unconditionally submits
to the jurisdiction of
each such Court for such
purpose. Further, the Borrower
waives any right it may have to claim or recover, in
any such
suit, action or proceeding, any
special, exemplary, punitive or consequential damages or any damages
other than, or in addition to, actual damages. THE
BORROWER ACKNOWLEDGES
AND AGREES THAT THIS PARAGRAPH IS A
SPECIFIC AND MATERIAL ASPECT OF THIS NOTE AND THAT
THE LENDER WOULD NOT EXTEND CREDIT
IF THE WAIVERS SET FORTH IN THIS PARAGRAPH WERE NOT A PART OF THIS
NOTE.


 

 



LENDER:

 





 _____________________________

 



OCEAN THERMAL ENERGY CORPORATION


 





By:
_______________________

 


Name:
Jeremy Feakins

 


Title:
CEO


 




 

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