ex10_5.htm


    
      

    

    Exhibit 10.5

     

    
      
        	 
      	
                WARRANT

              	 
      
	
                NO.
      125

              	
                PURESAFE
      WATER SYSTEMS, INC.

              	
                4,000,000  Shares

              
	 
      	 
      	 
      


      

    

    WARRANT TO PURCHASE COMMON
STOCK

     

    VOID
AFTER 5:30 P.M., EASTERN

    TIME,
ON THE EXPIRATION DATE

     

    THIS
WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED WITHOUT
COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS
THEREFROM.

     

    FOR VALUE
RECEIVED, PURESAFE WATER SYSTEMS, INC., a Delaware corporation (the “Company”),
hereby agrees to sell upon the terms and on the conditions hereinafter set
forth, but no later than 5:30 p.m., Eastern Time, on the Expiration Date (as
hereinafter defined) to Leslie J. Kessler or registered assigns (the “Holder”),
under the terms as hereinafter set forth, Four
million  (4,000,000) fully paid and non-assessable shares of
the Company’s Common Stock, par value $0.001 per share (the “Warrant Stock”), at
a purchase price of 4.1 cents ($0.041) per share (the
“Warrant Price”), pursuant to this warrant (this “Warrant”).  The
number of shares of Warrant Stock to be so issued and the Warrant Price are
subject to adjustment in certain events as hereinafter set forth.  The
term “Common Stock” shall mean, when used herein, unless the context otherwise
requires, the stock and other securities and property at the time receivable
upon the exercise of this Warrant.

     

    Capitalized
terms used and not otherwise defined herein shall have the respective meanings
attributed thereto in Section 10.

     

    1.            
Exercise of
Warrant.

     

    a.           The
Holder may exercise this Warrant according to its terms by surrendering this
Warrant to the Company at the address set forth in Section 10, the subscription
form attached hereto having then been duly executed by the Holder, accompanied
by cash, certified check or bank draft in payment of the purchase price, in
lawful money of the United States of America, for the number of shares of the
Warrant Stock specified in the subscription form, or as otherwise provided in
this Warrant, prior to 5:30 p.m., Eastern Time, on April 16, 2014 (the
“Expiration Date )

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    b.           This
Warrant may be exercised in whole or in part so long as any exercise in part
hereof would not involve the issuance of fractional shares of Warrant
Stock.  If exercised in part, the Company shall deliver to the Holder
a new Warrant, identical in form, in the name of the Holder, evidencing the
right to purchase the number of shares of Warrant Stock as to which this Warrant
has not been exercised, which new Warrant shall be signed by the Chief Executive
Officer of the Company.  The term Warrant as used herein shall include
any subsequent Warrant issued as provided herein.

     

    c.           No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant.  The Company shall pay cash in lieu of
fractions with respect to the Warrants based upon the fair market value of such
fractional shares of Common Stock (which shall be the closing price of such
shares on the exchange or market on which the Common Stock is then traded) at
the time of exercise of this Warrant.

     

    d.           In
the event of any exercise of the rights represented by this Warrant, a
certificate or certificates for the Warrant Stock so purchased, registered in
the name of the Holder, shall be delivered to the Holder within a reasonable
time after such rights shall have been so exercised.  The person or
entity in whose name any certificate for the Warrant Stock is issued upon
exercise of the rights represented by this Warrant shall for all purposes be
deemed to have become the holder of record of such shares immediately prior to
the close of business on the date on which the Warrant was surrendered and
payment of the Warrant Price and any applicable taxes was made, irrespective of
the date of delivery of such certificate, except that, if the date of such
surrender and payment is a date when the stock transfer books of the Company are
closed, such person shall be deemed to have become the holder of such shares at
the opening of business on the next succeeding date on which the stock transfer
books are open.

     

    2.            
Disposition of Warrant
Stock and Warrant.

     

    a.           The
Holder hereby acknowledges that this Warrant and any Warrant Stock purchased
pursuant hereto are, as of the date hereof, not registered: (i) under the Act on
the ground that the issuance of this Warrant is exempt from registration under
Section 4(2) of the Act as not involving any public offering or (ii) under any
applicable state securities law because the issuance of this Warrant does not
involve any public offering; and that the Company’s reliance on the Section 4(2)
exemption of the Act and under applicable state securities laws is predicated in
part on the representations hereby made to the Company by the Holder that it is
acquiring this Warrant and will acquire the Warrant Stock for investment for its
own account, with no present intention of dividing its participation with others
or reselling or otherwise distributing the same, subject, nevertheless, to any
requirement of law that the disposition of its property shall at all times be
within its control.

     

    The
Holder hereby agrees that it will not sell or transfer all or any part of this
Warrant and/or Warrant Stock unless and until it shall first have given notice
to the Company describing such sale or transfer and furnished to the Company
either (i) an opinion, reasonably satisfactory to counsel for the Company, of
counsel (skilled in securities matters, selected by the Holder and reasonably
satisfactory to the Company) to the effect that the proposed sale or transfer
may be made without registration under the Act and without registration or
qualification under any state law, or (ii) an interpretative letter from the
Securities and Exchange Commission to the effect that no enforcement action will
be recommended if the proposed sale or transfer is made without registration
under the Act.

     

    
      
        
        

      

      
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    b.           If,
at the time of issuance of the shares issuable upon exercise of this Warrant, no
registration statement is in effect with respect to such shares under applicable
provisions of the Act, the Company may at its election require that the Holder
provide the Company with written reconfirmation of the Holder’s investment
intent and that any stock certificate delivered to the Holder of a surrendered
Warrant shall bear legends reading substantially as follows:

     

    “THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF
THIS CERTIFICATE THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.”

     

    In
addition, so long as the foregoing legend may remain on any stock certificate
delivered to the Holder, the Company may maintain appropriate “stop transfer”
orders with respect to such certificates and the shares represented thereby on
its books and records and with those to whom it may delegate registrar and
transfer functions.

     

    3.            
Reservation of
Shares.  The Company hereby agrees that at all times there
shall be reserved for issuance upon the exercise of this Warrant such number of
shares of its Common Stock as shall be required for issuance upon exercise of
this Warrant.  The Company further agrees that all shares which may be
issued upon the exercise of the rights represented by this Warrant will be duly
authorized and will, upon issuance and against payment of the exercise price, be
validly issued, fully paid and non-assessable, free from all taxes, liens,
charges and preemptive rights with respect to the issuance thereof, other than
taxes, if any, in respect of any transfer occurring contemporaneously with such
issuance and other than transfer restrictions imposed by federal and state
securities laws.

     

    4.            
Exchange, Transfer or
Assignment of Warrant.  This Warrant is exchangeable, without
expense, at the option of the Holder, upon presentation and surrender hereof to
the Company or at the office of its stock transfer agent, if any, for other
Warrants of different denominations, entitling the Holder or Holders thereof to
purchase in the aggregate the same number of shares of Common Stock purchasable
hereunder.  Upon surrender of this Warrant to the Company or at the
office of its stock transfer agent, if any, with the Assignment Form annexed
hereto duly executed and funds sufficient to pay any transfer tax, the Company
shall, without charge, execute and deliver a new Warrant in the name of the
assignee named in such instrument of assignment and this Warrant shall promptly
be canceled.  This Warrant may be divided or combined with other
Warrants that carry the same rights upon presentation hereof at the office of
the Company or at the office of its stock transfer agent, if any, together with
a written notice specifying the names and denominations in which new Warrants
are to be issued and signed by the Holder hereof.

     

    
      
        
        

      

      
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    5.             Capital
Adjustments.  This Warrant is subject to the following further
provisions:

     

    a.           Recapitalization,
Reclassification and Succession.  If any recapitalization
of the Company or reclassification of its Common Stock or any merger or
consolidation of the Company into or with a corporation or other business
entity, or the sale or transfer of all or substantially all of the Company’s
assets or of any successor corporation’s assets to any other corporation or
business entity (any such corporation or other business entity being included
within the meaning of the term “successor corporation”) shall be effected, at
any time while this Warrant remains outstanding and unexpired, then, as a
condition of such recapitalization, reclassification, merger, consolidation,
sale or transfer, lawful and adequate provision shall be made whereby the Holder
of this Warrant thereafter shall have the right to receive upon the exercise
hereof as provided in Section 1 and in lieu of the shares of Common Stock
immediately theretofore issuable upon the exercise of this Warrant, such shares
of capital stock, securities or other property as may be issued or payable with
respect to or in exchange for a number of outstanding shares of Common Stock
equal to the number of shares of Common Stock immediately theretofore issuable
upon the exercise of this Warrant had such recapitalization, reclassification,
merger, consolidation, sale or transfer not taken place, and in each such case,
the terms of this Warrant shall be applicable to the shares of stock or other
securities or property receivable upon the exercise of this Warrant after such
consummation.

     

    b.           Subdivision or Combination
of Shares.  If the Company at any time while this Warrant
remains outstanding and unexpired shall subdivide or combine its Common Stock,
the number of shares of Warrant Stock purchasable upon exercise of this Warrant
and the Warrant Price shall be proportionately adjusted.

     

    c.           Stock and Rights Offering to
Shareholders.  If the Company shall at any time after the date
of issuance of this Warrant distribute to all holders of its Common Stock any
shares of capital stock of the Company (other than Common Stock) or evidences of
its indebtedness or assets (excluding cash dividends or distributions paid from
retained earnings or current year’s or prior year’s earnings of the Company) or
rights or warrants to subscribe for or purchase any of its securities (excluding
those referred to in the immediately preceding paragraph) (any of the foregoing
being hereinafter in this paragraph called the “Securities”), then in each such
case, the Company shall reserve shares or other units of such securities for
distribution to the Holder upon exercise of this Warrant so that, in addition to
the shares of the Common Stock to which such Holder is entitled, such Holder
will receive upon such exercise the amount and kind of such Securities which
such Holder would have received if the Holder had, immediately prior to the
record date for the distribution of the Securities, exercised this
Warrant.

     

    d.           Warrant Price
Adjustment.  Whenever the number of shares of Warrant Stock
purchasable upon exercise of this Warrant is adjusted, as herein provided, the
Warrant Price payable upon the exercise of this Warrant shall be adjusted to
that price determined by multiplying the Warrant Price immediately prior to such
adjustment by a fraction (i) the numerator of which shall be the number of
shares of Warrant Stock purchasable upon exercise of this Warrant immediately
prior to such adjustment, and (ii) the denominator of which shall be the number
of shares of Warrant Stock purchasable upon exercise of this Warrant immediately
thereafter.

     

    
      
        
        

      

      
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    e.           Certain Shares
Excluded.  The number of shares of Common Stock outstanding at
any given time for purposes of the adjustments set forth in this Section 5 shall
exclude any shares then directly or indirectly held in the treasury of the
Company.

     

    f.           Deferral and Cumulation of
De Minimis Adjustments.  The Company shall not be required to
make any adjustment pursuant to this Section 5 if the amount of such adjustment
would be less than one percent (1%) of the Warrant Price in effect immediately
before the event that would otherwise have given rise to such
adjustment.  In such case, however, any adjustment that would
otherwise have been required to be made shall be made at the time of and
together with the next subsequent adjustment which, together with any adjustment
or adjustments so carried forward, shall amount to not less than one percent
(1%) of the Warrant Price in effect immediately before the event giving rise to
such next subsequent adjustment.

     

    g.           Duration of
Adjustment.  Following each computation or readjustment as
provided in this Section 5, the new adjusted Warrant Price and number of shares
of Warrant Stock purchasable upon exercise of this Warrant shall remain in
effect until a further computation or readjustment thereof is
required.

     

    6.             Notice to
Holders.

     

    a.           Notice of Record
Date.  In case:

     

    (i)           the
Company shall take a record of the holders of its Common Stock (or other stock
or securities at the time receivable upon the exercise of this Warrant) for the
purpose of entitling them to receive any dividend (other than a cash dividend
payable out of earned surplus of the Company) or other distribution, or any
right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right;

     

    (ii)           of
any capital reorganization of the Company, any reclassification of the capital
stock of the Company, any consolidation with or merger of the Company into
another corporation, or any conveyance of all or substantially all of the assets
of the Company to another corporation; or

     

    (iii)           of
any voluntary dissolution, liquidation or winding-up of the
Company;

     

    then, and
in each such case, the Company will mail or cause to be mailed to the Holder
hereof at the time outstanding a notice specifying, as the case may be, (i) the
date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding-up is to take place, and the time, if any, is to be fixed, as of which
the holders of record of Common Stock (or such stock or securities at the
time receivable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, conveyance, dissolution or winding-up.  Such
notice shall be mailed at least thirty (30) days prior to the record date
therein specified, or if no record date shall have been specified therein, at
least thirty (30) days prior to such specified date, provided, however, failure
to provide any such notice shall not affect the validity of such
transaction.

     

    
      
        
        

      

      
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    b.           Certificate of
Adjustment. Whenever any adjustment shall be made pursuant to Section 5
hereof, the Company shall promptly make a certificate signed by its Chief
Executive Officer setting forth in reasonable detail the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated and the Warrant Price and number of shares of Warrant Stock
purchasable upon exercise of this Warrant after giving effect to such
adjustment, and shall promptly cause copies of such certificates to be mailed
(by first class mail, postage prepaid) to the Holder of this
Warrant.

     

    7.            
Loss, Theft,
Destruction or Mutilation.  Upon receipt by the Company of
evidence satisfactory to it, in the exercise of its reasonable discretion, of
the ownership and the loss, theft, destruction or mutilation of this Warrant
and, in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to the Company and, in the case of mutilation, upon surrender and
cancellation thereof, the Company will execute and deliver in lieu thereof,
without expense to the Holder, a new Warrant of like tenor dated the date
hereof.

     

    8.            
Warrant Holder Not a
Stockholder.  The Holder of this Warrant, as such, shall not be
entitled by reason of this Warrant to any rights whatsoever as a stockholder of
the Company.

     

    9.            
Definitions.  As
used herein, unless the context otherwise requires, the following terms have the
respective meanings:

     

    a.           
“Affiliate”:  with
respect to any Person, the following:  (i) any other Person that at
such time directly or indirectly through one or more intermediaries controls, or
is controlled by or is under common control with such first Person or (ii) any
Person beneficially owning or holding, directly or indirectly, 10% or more of
any class of voting or equity interests of the Company or any Subsidiary or any
corporation of which the Company and its Subsidiaries beneficially own or hold,
in the aggregate, directly or indirectly, 10% of more of any class of voting or
equity interests.  As used in such definition, “controls,” “controlled
by” and “under common control,” as used with respect to an Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise.

     

    b.           “Person”:  any
natural person, corporation, division of a corporation, partnership, limited
liability company, trust, joint venture, association, company, estate,
unincorporated organization or government or any agency or political subdivision
thereof.

     

    c.           “Subsidiaries”:  with
respect to any Person, any corporation, association or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the securities or other ownership interests having ordinary voting power for the
election of directors is, at the time as of which any determination is being
made, owned or controlled by such Person or one or more subsidiaries of such
Person.

     

    10.           Notices.  Any
notice required or contemplated by this Warrant shall be deemed to have been
duly given if transmitted by registered or certified mail, return receipt
requested, or nationally recognized overnight delivery service, to the Company at its
principal executive offices located at 1007 Glen Cove Ave, Glen Head, New York
11545, Attention: David A. Conway, Chief Executive Officer, or to the Holder at
the name and address set forth in the Warrant Register maintained by the
Company.

     

    
      
        
        

      

      
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    11.           Choice of
Law.  THIS WARRANT IS ISSUED UNDER AND SHALL FOR ALL PURPOSES
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF
LAW.

     

    12.           Jurisdiction and
Venue.  The Company and Holder hereby agree that any dispute
which may arise between them arising out of or in connection with this Warrant
shall be adjudicated before a court located in Nassau County, New York and they
hereby submit to the exclusive jurisdiction of the federal and state courts of
the State of New York located in Nassau County with respect to any action or
legal proceeding commenced by any party, and irrevocably waive any objection
they now or hereafter may have respecting the venue of any such action or
proceeding brought in such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Warrant or any acts or
omissions relating to the sale of the securities hereunder, and consent to the
service of process in any such action or legal proceeding by means of registered
or certified mail, return receipt requested, in care of the address set forth
herein or such other address as either party shall furnish in writing to the
other.

     

    
      
        
        

      

      
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    IN
WITNESS WHEREOF, the Company has duly caused this Warrant to be signed on its
behalf, in its corporate name and by its duly authorized officers, as of this
17th day of April, 2009.

     

    
      
        
          	 
      	
                  PURESAFE
      WATER SYSTEMS, INC.

                
	 
      	 
      
	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Terry R. Lazar

                
	 
      	 
      	
                  Name:

                	
                  Terry
      R. Lazar

                
	 
      	 
      	
                  Title:

                	
                  Chief
      Financial Officer

                


        

      

    

     

    
      
        
        

      

      
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    FORM OF
EXERCISE

     

    (to be
executed by the registered holder hereof)

     

     

    The
undersigned hereby exercises the right to purchase _________ shares of common
stock, par value $0.001 per share ("Common Stock"), of Water Chef, Inc.
evidenced by the within Warrant Certificate for an Applicable Exercise Price of
$  per
share and herewith makes payment of the purchase price in full of
$__________. Kindly issue certificates for shares of Common Stock (and for the
unexercised balance of the Warrants evidenced by the within Warrant Certificate,
if any) in accordance with the instructions given below.

     

    


     

    Dated:____________________
, 20__ .

    


    


    ______________________________

    


    Instructions
for registration of stock

    


    


    _____________________________

    Name
(Please Print)

    


    Social
Security or other identifying Number:

    


    Address:__________________________________

    City/State
and Zip Code

    


    


     Instructions
for registration of certificate representing

    the
unexercised balance of Warrants (if any)

    


    


    _____________________________

    Name
(Please Print)

    


    Social
Security or other identifying Number: ___________

    


    Address:____________________________________

    City,
State and Zip Code

     

     

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