Document:

ex10_37.htm

    
      

    

    Exhibit 10.4

     

    
      PureSafe
Water Systems, Inc.

      

      Incentive
Stock Option Agreement

      

      

      PureSafe Water Systems, Inc., a
Delaware corporation (the “Company”), pursuant to the Company’s 2008 Equity
Incentive Plan (the “Plan”), has granted to Jawyi Dillmann (the “Optionee”) a
stock option (the “Option”) to purchase a total of two hundred and fifty
thousand shares (each, a “Share”) of the common stock, par value $0.001 per
share (the “Common Stock”), of the Company, at the exercise price of $0.041 per
Share (the “Exercise Price”), on the terms and conditions set forth in this
Incentive Stock Option Plan Agreement (this “Agreement”) and, in all respects,
subject to the terms and conditions of the Plan.  The date of grant of
the Option is April 17, 2009 (the “Date of Grant”).  Unless otherwise
defined herein, the capitalized terms defined in the Plan shall have the same
defined meanings in this Agreement.  The Option is intended to be an
Incentive Stock Option within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended (the “Code”); provided, however, to the
extent that the Option does not qualify as an Incentive Stock Option under the
Code, such portion of the Option shall be treated as an option that does not
qualify as an Incentive Stock Option under the Code.

      

      1.        
   Duration.  Subject
to the earlier termination as provided in this Agreement or under the Plan, the
Option shall expire and shall no longer be exercisable as of the close of
business on April 16, 2014 (the “Termination Date”).

      

      2.     
      Written Notice of
Exercise.  The Option may be exercised only by delivering to
the President or Secretary of the Company, at the Company’s principal executive
offices, of a written notice of exercise substantially in the form described in
paragraph 8(b) of this Agreement, accompanied by this Agreement.

      

      3.        
   Anti Dilution Provisions.

      

      (a)           If
there is any stock dividend, stock split or combination of shares of Common
Stock, the number and amount of Shares then subject to the Option shall be
proportionately and appropriately adjusted as determined by the Committee, whose
determination shall be final, conclusive and binding upon Optionee and the
Company.

      

      (b)           If
there is any other change in the Common Stock, including a recapitalization,
reorganization, sale or exchange of assets, exchange of shares, offering of
subscription rights, or a merger or consolidation in which the Company is the
surviving corporation, an adjustment, if any, shall be made in the Shares then
subject to the Option as the Board of Directors or Committee may deem equitable,
and whose determination shall be final, conclusive and binding upon Optionee and
the Company.  Failure of the Board of Directors or the Committee to
provide for an adjustment pursuant to this paragraph 3(b) prior to the effective
date of any Company action referred to in this paragraph 3(b) shall be
conclusive evidence that no adjustment is required in consequence of such
action.

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

      (c)           If
the Company is merged into or consolidated with any other corporation and the
Company is not the surviving corporation, or if the Company sells all or
substantially all of the Company’s assets to any other corporation, then
either

      (i)        
   the Company shall cause provisions to be made for the
continuance of the Option after such event or for the substitution for the
Option of an option covering the number and class of securities which the
Optionee would have been entitled to receive in such merger, consolidation or if
the Optionee had been the holder of record of a number of shares of Common Stock
equal to the number of Shares covered by the unexercised portion of the Option
immediately prior to such merger, consolidation or sale or

      (ii)           the
Company shall give to Optionee written notice of the Company’s election not to
cause such provision to be made and the Option shall become exercisable in full
(or, at the election of the Optionee, in part) at any time during a period of
thirty days, to be designated by the Company, ending not more than ten days
prior to the effective date of the merger, consolidation or sale, in which case
the Option shall not be exercisable to any extent after the expiration of such
thirty-day period.

      

      Notwithstanding
the provisions of this paragraph 3(c), in no event shall the Option be
exercisable after the Termination Date.

      

      4.       
    Investment Representation and Legend
of Certificates.  Optionee acknowledges that, for any period in
which a registration statement with respect to the Option and/or Shares under
the Securities Act of 1933, as amended (the “Securities Act”), is not effective,
Optionee shall hold the Option and will purchase and/or own the Shares for
investment purposes only and not for resale or distribution.  The
Company shall have the right to place upon the face and/or reverse side of any
stock certificate or certificates evidencing the Shares such legend as the
Committee may prescribe for the purpose of preventing disposition of such Shares
in violation of the Securities Act.

      

      5.        
   Non
Transferability.  The Option shall not be transferable by
Optionee, other than by (a) will, the laws of descent or distribution or (b)
pursuant to a proceeding under title 11 of the U.S. Bankruptcy Code or similar
insolvency proceeding, and is exercisable during the lifetime of Optionee only
by Optionee, except as otherwise specifically provided in this Agreement or the
Plan.  The terms of this Agreement shall be binding upon the
executors, administrators, heirs, successors and assigns of
Optionee.

      

      6.        
   Certain
Rights Not Conferred by Option.  Optionee shall not, by virtue
of holding the Option, be entitled to any rights of a stockholder in the
Company.

      

      7.         
  Expenses.  The
Company shall pay all original issue and transfer taxes with respect to the
issuance of the Shares pursuant hereto and all other fees and expenses
necessarily incurred by the Company in connection therewith.

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      8.         
  Exercise of Options.

      

      (a)           The
Option shall become exercisable on the dates and in the amounts as
follows:

      

      
        
          
            	
                    Date
      First Exercisable

                  	
                    Number
      of Shares

                    (Cumulative)

                  	 
	
                    April
      17, 2009

                  	
                    250,000

                  	 

          

        

      

      

       

      (b)           The
Option shall be exercisable, in whole or part and from time to time, but subject
to the exercise schedule set forth in paragraph 8(a) of this Agreement, by
written notice of such exercise, delivered to the President or Secretary of the
Company, at the Company’s principal office by personal delivery, against written
receipt therefor, or by pre-paid, certified or registered mail, return receipt
requested.  Such notice shall specify the number of Shares for which
the Option is being exercised (which number, if less than all of the Shares then
subject to exercise, shall be 100 or an integral multiple thereof) and shall be
accompanied by

      (i)       
    payment of the full exercise price for the Shares for
which the Option is being exercised and

      (ii)           this
Agreement.

      

      (c)           The
form of payment of the Exercise Price for Shares purchased pursuant to each
exercise of the Option shall be paid in full at the time of each purchase in one
or a combination of the following methods:

      (i)          
 cash;

      (ii)           check
(subject to collection);

      (iii)           in
the discretion of the Committee, surrender to the Company of other shares of
Common Stock owned by the Optionee which

      (A)          have
a Fair Market Value on the date of surrender equal to the aggregate exercise
price of the Shares as to which the Option is being exercised and

      (B)           have
been owned of record by Optionee for at least six months;

      (iv)           in
the discretion of the Committee, commencing upon the date on which all of the
Shares subject to the Option are exercisable in accordance with the exercise
schedule set forth in paragraph 8(a) of this Agreement, by “cashless exercise,”
by means of exercising the Option in full and receiving such number of Shares
having a Fair Market Value on the date of such cashless exercise equal to the
difference between

      (A)          the
Fair Market Value of the Shares issuable upon exercise of the Option in full on
the date of such cashless exercise and

      (B)           the
exercise price of the Option multiplied by the number of Shares issuable upon
exercise of the Option in full; or

      (v)           in
the discretion of the Committee, but, in all cases, subject to applicable law,
by

      (A)          delivery
to the Company of a promissory note containing such terms and conditions
determined by the Committee, in the Committee’s sole discretion, but at a rate
of interest at least equal to the imputed interest specified under Section 483
or Section 1274, whichever is applicable, of the Code, and secured by the Shares
issuable upon exercise of the Option for which the promissory note is being
delivered and otherwise in compliance with applicable law (including, without
limitation, state corporate law and federal margin
requirements),

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      (B)     
     assignment to the Company of the net proceeds (to
the extent necessary to pay such exercise price) to be received from a
registered broker upon the sale of the Shares or assignment of the net proceeds
(to the extent necessary to pay such exercise price) of a loan from such broker
in such amount or

      (C)           such
other consideration and method of payment for the issuance of stock to the
extent permitted under applicable law and satisfying the requirements of Rule
16b-3 promulgated pursuant to the Exchange Act.

      

      (d)           No
Shares shall be delivered upon exercise of the Option until all laws, rules and
regulations which the Committee may deem applicable have been complied
with.  If a registration statement under the Securities Act is not
then in effect with respect to the Shares issuable upon such exercise, the
Company may require as a condition precedent that Optionee, upon exercising the
Option, deliver to the Company a written representation and undertaking,
satisfactory in form and substance to the Committee, that, among other things,
Optionee is acquiring the Shares for Optionee’s own account for investment
purposes only and not with a view to the distribution thereof.

      

      (e)           Optionee
shall not be considered a record holder of the Shares so purchased for any
purpose until the date on which Optionee is actually recorded as the holder of
such Shares in the records of the Company.

      

      (f)         
  In the event of Optionee’s death, disability or termination of
employment, the exercisability of the Option shall be governed by the provisions
of section 5.7 of the Plan, unless such provisions are waived by the Committee,
in the Committee’s sole discretion.

      

      9.        
   Covenant Not
to Compete or Otherwise Injure the Company; Work Product.  The
acceptance by Optionee of this Agreement and the Option shall constitute the
acceptance of and agreement to all of the terms and conditions contained in this
Agreement and in the Plan, and shall further constitute a covenant and agreement
on the part of Optionee to the effect that, without any additional
compensation:

      

      (a)           Optionee
shall, so long as Optionee is employed by the Company and for a period of twelve
months after the termination of Optionee’s employment with the Company, Optionee
will not engage in any “competitive activities,” which “competitive activities”
shall include:

      (i)    
       without the written permission of the
Company, hiring, offering to hire, enticing away or in any other manner
persuading or attempting to persuade any officer, employee, contractor, licensor
or agent of or supplier to the Company to discontinue, limit or reduce such
person’s relationship with the Company;

      (ii)           directly
or indirectly soliciting, diverting, taking away or attempting to solicit,
divert, or take away any “business” of the Company (including actual or proposed
contracts or arrangements for products or services of the Company and any
reasonable extension or continuation of such business of the Company as
constituted at the time of the termination of Optionee’s employment) of which
Optionee has any knowledge during the term of Optionee’s
employment;

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      (b)           Optionee
shall not make or permit to be made, except pursuant to Optionee’s duties and
for the sole use and account of the Company or its nominees, any copies,
abstracts or summaries of any Company reports, papers, documents or programs,
whether made by Optionee or by others, and Optionee agrees that all of such
reports, papers, documents and programs are the sole property of the
Company;

      

      (c)           Optionee
cedes and grants and agrees to cede and grant to the Company, all rights to
possession, copying, and title in and to, any Company reports, papers, documents
or programs, or copies, abstracts or summaries thereof, in any form, coming into
possession of Optionee during and because of Optionee’s employment by the
Company, whether made or prepared by Optionee or by others;

      

      (d)           Optionee
shall keep confidential and not disclose to others, except as required by
Optionee’s employment or by law, any matter or thing ascertained by Optionee
though Optionee’s association with the Company, not otherwise publicly known,
the disclosure of which might possibly be contrary to the best interests of any
person, firm or corporation doing business with the Company, or of the Company;
and

      

      (e)           If
any product, invention, discovery, patent, patented item, formula, improvement
or process relating to the business of the Company (the “Work Product”) is
created, conceived, developed or discovered by Optionee, either solely or
jointly with others, during the period of Optionee’s employment by the Company,
Optionee shall forthwith disclose the same to the Company and does hereby assign
to the Company any and all such Work Product and all of Optionee’s rights
thereto.  At any time, whether during the period of said employment or
thereafter, upon request by the Company, Optionee will

      (i)          
 execute and deliver to the Company an instrument assigning to the Company
Optionee’s entire right, title and interest in and to any or all such Work
Product, and applications for letters patent therefor, or reissues
thereof;

      (ii)           execute
and deliver application papers for letters patent in any country for any and all
such Work Product, as may be required by the Company;

      (iii)          execute
and similarly deliver any and all other papers and do such other acts as may in
the opinion of the Company be desirable to more effectively convey to the
Company the rights intended hereby to be conveyed; and

      (iv)          aid
and assist the Company in the prosecution or defense of any claim or litigation
involving any and all of such Work Product;

      provided, however, that the
foregoing services which Optionee agrees to render shall be rendered at no
expense to Optionee.

      

      10.          Continued
Employment.  Nothing herein shall be deemed to create any
employment or consultancy or guaranty of continued employment or consultancy or
limit in any way the Company’s right to terminate Optionee’s employment or
consultancy at any time.

      

      11.          Early
Disposition of Stock.

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      By
accepting this Agreement and the Option, Optionee acknowledges and confirms
that, if Optionee disposes of any Shares received under the Option within two
years after the Date of Grant or within one year after such Shares were
transferred to Optionee, Optionee may be treated for federal and state income
tax purposes as having received ordinary income at the time of such disposition
as determined in accordance with the Code and applicable state
law.  Optionee hereby agrees to notify the Company in writing within
thirty days after the date of any such disposition.  Optionee
authorizes the Company to withhold tax from Optionee’s current compensation with
respect to any income recognized as a result of any such
disposition.

      

      

      
        
          
            
              	 
      	
                      PureSafe
      Water Systems, Inc.

                    
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                      By:

                    	
                      /s/ Leslie J. Kessler

                    
	 
      	 
      	
                      Leslie
      J. Kessler,
President

                    

            

          

        

      

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      OPTIONEE
ACKNOWLEDGEMENT

      

      OPTIONEE ACKNOWLEDGES AND AGREES THAT
THE EXERCISABILITY OF THE SHARES SUBJECT TO THIS AGREEMENT AND THE OPTION IS
EARNED ONLY BY CONTINUING EMPLOYMENT OR CONSULTANCY AT THE WILL OF THE COMPANY
(NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THE OPTION OR ACQUIRING
SHARES HEREUNDER).  OPTIONEE FURTHER ACKNOWLEDGES AND CONFIRMS THAT
NOTHING IN THIS AGREEMENT, NOR IN THE PLAN WHICH IS INCORPORATED HEREIN BY
REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION OF
EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH
OPTIONEE’S OR THE COMPANY’S RIGHT, SUBJECT TO OPTIONEE’S AND THE COMPANY’S
RIGHTS UNDER OTHER AGREEMENTS, IF ANY, WITH THE COMPANY, TO TERMINATE EMPLOYMENT
OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.

      

      Optionee acknowledges receipt of a copy
of the Plan and certain information related to this Plan and Company and
represents that Optionee is familiar with the terms and provisions of the Plan,
and hereby accepts the Option subject to all of the terms and provisions of the
Plan.  Optionee has reviewed the Plan and this Agreement in their
entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Agreement and fully understands all of the terms and provisions
of the Option and this Agreement.  Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Committee
upon any questions rising under the Plan.  Optionee further agrees to
notify the Company upon any change in the residence address indicated
below.

      

      Accepted
and agreed as of the Date

      of Grant
as first set forth above:

      

      

      /s/ Jawyi
Dillmann

      
        	
                Name:

              	
                Jawyi
      Dillmann

              

      

      
        	
                Address:

              	
                37
      Irving Place

              

      

      Oyster
Bay, NY 11771

    7ex10_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.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    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.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    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.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    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.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    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.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    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.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    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

                

        

      

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    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

     

     

    9

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