Document:

EXHIBIT 10.5

 

FORM A

 

THIS WARRANT AGREEMENT HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES
LAWS AND MAY NOT BE TRANSFERRED WITHOUT REGISTRATION UNDER THE ACT AND
REGISTRATION OR QUALIFICATION UNDER ANY STATE SECURITIES LAW, UNLESS IN THE
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER AN EXEMPTION FROM REGISTRATION
UNDER THE ACT AND REGISTRATION OR QUALIFICATION UNDER SAID LAWS IS AVAILABLE

 

[DATE]

 

WORLDWATER
CORP.

COMMON STOCK
PURCHASE WARRANT AGREEMENT (EXERCISABLE AT $0.          
PER SHARE FOR            
SHARES)

 

WorldWater
Corp. (the “Company”) hereby grants to the holder,               ,
the right to purchase, under the limited circumstances set forth herein at any
time commencing on the Commencement Date (as defined below) until                         
(the “Expiration Date”)             
fully paid and non-assessable shares of the Company’s Common Stock, par value
$.001 per share (the “Common Stock”).

 

This Warrant
Agreement (hereafter “Warrant”) is exercisable at a price equal to $0.         
per share of the Common Stock issuable hereunder (the “Exercise
Price”) until                  payable by certified or official bank
check as hereinafter provided. Upon surrender of this Warrant with the annexed
Election to Purchase duly executed, together with payment of the Exercise Price
for the shares of Common Stock purchased, at the Company’s principal executive
offices presently located at 55 Route 31 South, Pennington, New Jersey 08534,
the holder shall be entitled to receive a certificate or certificates for the
shares of Common Stock so purchased.

 

1.                                      Exercise
of Warrant

 

The purchase
rights represented by this Warrant are exercisable by the holder hereof, in
whole or in part (but not as to fractional shares of Common Stock), on the date
(the “Commencement Date”) that is the date of issuance of this Warrant, and
only until the Expiration Date.

 

1

 

2.                                       Issuance of
Stock Certificates

 

The issuance
of certificates for shares of Common Stock upon the exercise of this warrant
shall be made without charge to the holder hereof including, without
limitation, any tax that may be payable in respect thereof, and such
certificates shall (subject to the provisions of Section 3) be issued in
the name of, or in such names as may be directed by, the holder thereof;
provided, however, that the Company shall not be required to pay any income tax
to which the holder hereof may be subject in connection with the issuance of
this Warrant or of shares of Common Stock upon exercise of this Warrant; and
provided further, that the Company shall not be required to pay any tax that
may be payable in respect of any transfer involved in the issuance and delivery
of any such certificate in a name other than that of the holder; the Company
shall not be required to issue or deliver such certificates unless or until the
person or person requesting the issuance thereof shall have paid to the Company
the amount of such tax or shall have established to the reasonable satisfaction
of the Company that such tax has been paid.

 

3.                                      Restriction
on Transfer of Warrant.

 

3.1                                Registration on
Transfer.  The holder of this
Warrant, by his acceptance hereof, covenants and agrees that this Warrant is
being acquired without any view to the distribution hereof or of the rights
evidenced hereby.    This Warrant may be transferred
only in accordance with federal and state security laws.

 

3.2                                Transfer Restriction
Legend. Each certificate representing Warrant shares (as hereinafter
defined), unless at the time of exercise such Warrant shares are registered
under the Act, shall bear a legend in substantially the following form on the face
thereof:

 

THESE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND
MAY NOT BE TRANSFERRED WITHOUT REGISTRATION UNDER SAID ACT AND REGISTRATION OR
QUALIFICATION UNDER ANY STATE SECURITIES LAW, UNLESS IN THE OPINION OF COUNSEL
ACCEPTABLE TO THE ISSUER AN EXEMPTION FROM REGISTRATION UNDER SAID ACT AND
REGISTRATION OR QUALIFICATION UNDER SAID LAWS IS AVAILABLE.

 

Any
certificate issued at any time in exchange or substitution for any certificate
bearing such legend shall also bear such legend unless, in the opinion of
counsel acceptable to the Company, the securities represented thereby may be
transferred as contemplated by such holder without violation of applicable law.

 

 

4.                                       Registration
Rights

 

4.1                                Incidental
Registration.   If at any time after
the date of the closing of a public offering and prior to the second
anniversary of such date, the Company proposes to register any of its equity
securities under the Act on a registration form usable for resales generally
(other than a registration statement on Form S-8 or other form similar thereto
relating to employees benefit plans hereinafter adopted by the Securities and Exchange
Commission or on Form S-4), it will give written notice, at least 30 days prior
to the filing of any such registration statements to all holders of Warrants and/or
Warrant Shares of its intention to do so. If the holders of Warrants and/or
Warrant Shares notify the Company within 20 days after receipt of any such
notice of their desire to include their Warrant Shares, in whole or in part, in
such proposed registration statement, the Company shall afford such holders the
opportunity to have their Warrant Shares registered under such registration
statement.   The Company shall not be
required to include any Warrants in any such registration statement.

 

Notwithstanding
the foregoing, if the underwriters of such offering determine that the total
amount of securities which they and any other persons or entities intend to
include in such offering would adversely affect the success of such offering,
then the amount of Warrant Shares to be offered by the holders of Warrant
Shares shall be reduced pro rata with all other securities the holders of such
other securities have requested to be included in such registration to the
extent necessary to reduce the total amount of securities to be included in
such offering to the amount recommended by such underwriters or excluded in
their entirety, as the case may be.

 

Further, the
Company shall have the right at any time after it shall have given written
notice pursuant to this Section 4.1 (irrespective of whether a written
request for inclusion of Warrant Shares shall have been made) to elect not to
withdraw the same after the filing thereof.

 

4.2                                Covenants
of the Company with Respect to Registration 
In connection with any registration under Section 4.1, the Company
covenants and agrees as follows:

 

(a)                               The
Company shall use its best efforts to have any registration statement declared
effective at the earliest possible time, and shall furnish such number of prospectuses
to the holders as shall reasonably be requested.

 

(b)                              The
Company shall pay all costs, fees and expenses in connection with all registration
statements under Section 4.1, including, without limitation, the Company’s
legal and accounting fees, printing expenses and blue sky fees and expenses,
except that the Company shall not pay for (i) underwriting discounts and
commissions, (ii) state transfer taxes, (iii) brokerages commissions and (iv)
fees and expenses of counsel and accountants for the holders of the Warrants
and/or Warrant Shares.

 

 

(c)                                 The
Company will take all necessary action that may be required in seeking to register
or qualify the Warrant Shares included in a registration statement for offering
and sale under the securities or blue sky laws of such states as are reasonably
requested by the holders of the Warrant Shares provided that the Company shall
not be obliged to execute or file any general consent to service of process or
to qualify as a foreign corporation to do business under the laws of any such jurisdiction.

 

(d)                                The Company shall
indemnify the holders of Warrant Shares included in any registration statement
and each person, if any, who controls any such holder within the meaning of Section 15
of the Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which any of them may become subject under the
Act, the Exchange Act or otherwise, arising out of or based upon any untrue statement
or alleged untrue statement of a material fact in such registration statement or
any related prospectus, offering circular, notification or other document furnished
or authorized by the Company, or any omission or alleged omission of any
material fact required to be stated therein or necessary to make the statements
therein not misleading, unless such actual or alleged statement or omission was
made in reliance upon and in conformity with information furnished in writing
to the Company by or on behalf of any holder specifically for use in connection
with the preparation of such registration statement, prospectus, offering,
circular, notification, or other document.

 

(e)                                 Each holder of the
Warrants and/or Warrant Shares for whose benefit shares are included in any
registration statement shall indemnify such other holders, the Company, its
officers and directors and each person, if any, who controls any such holder or
the Company within the meaning of Section 15 of the Act or Section 29(a)
of the Exchange Act, against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act, or otherwise, arising out of or based upon any
untrue statement or alleged untrue statement of a material fact in such
registration statement or any related prospectus, offering circular,  notification, 
or other document furnished or authorized by the Company, or any
omission or alleged omission of any material fact required to be stated therein
or necessary to make the statements therein not misleading, but only if such actual
or alleged statement or omission was made in reliance upon and in conformity with
information furnished by or on behalf of such holder for specific inclusion in
such registration statement, prospectus, offering circular, notification, or
other document.

 

 

5.                                       Adjustments

 

5.1                                 Subdivision and
Combination of Common Stock.  In case
the Company shall at any time during the period from the date hereof through
the Expiration Date subdivide (by any stock split, stock dividend or otherwise)
or combine (by any reverse stock split or otherwise) the outstanding shares of
Common Stock, the aggregate number of shares of Common Stock issuable upon the
exercise of this Warrant (and of all the Warrants) and the corresponding
Exercise Price shall be proportionately increased or decreased, as the case may
be.

 

5.2                                 Reclassification
Consolidation Merger etc.  In case
of, during the period from the date hereof through the Expiration Date, any
reclassification or change of the outstanding shares of Common Stock (other
than a change from no par value to par value or vice versa or a change in par
value, or as a result of a subdivision or combination), or in the case of any
consolidation of the Company with, or merger of the Company with or into,
another corporation (other than a consolidation or merger in which the Company
is the surviving corporation and which does not result in any reclassification
of, or change in (other than as a result of a subdivision or combination of such
shares or a change in par value as aforesaid), the outstanding shares of Common
Stock of the company), or in the case of a sale or conveyance to another
corporation of the property of the Company substantially as an entirety, the
holder of this Warrant shall therefore (but only until the Expiration Date)
have the right to purchase the kind and number of shares of stock and/or other
securities or property receivable upon such reclassification, change,
consolidation, merger, sale, or conveyance in respect of the number of shares
issuable under this Warrant that would have been purchasable by such holder if
such number of shares of Common Stock issuable hereunder had been purchased
immediately prior to such reorganization, reclassification, etc. The Company shall
be obliged to retain and set aside, or otherwise make fair provision for
exercise of the right of the holder hereof to receive the shares of stock
and/or other securities or property provided for in this Section 5.2.

 

6.1                                Exchange
and Replacement of Warrant.

 

This Warrant
is exchangeable without expense, upon surrender hereof by the holder hereof at
the principal executive office of the Company set forth in the introduction
hereof, for a new Warrant or Warrants of like tenor and date representing in
the aggregate the right to purchase the same number of shares as are
purchasable hereunder in such denominations as shall be designated by the
holder hereof at the time of such surrender.

 

 

Upon receipt by the Company 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, upon receipt of
indemnity or security reasonably satisfactory to it, and reimbursement to the
Company of all reasonable expenses incidental thereto, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will make and deliver a
new Warrant of like tenor, in lieu of this Warrant.

 

7.                                       Redemption

 

(a)                                 The Company may, at
its option, call for redemption all or any portion of the then outstanding
Warrants at a call price of $0.01 per Warrant (the “Call Price”), at any time;
provided that the Current Market price shall have been greater than or equal to
150% of the then current Exercise Price on each of the 15 consecutive trading
days prior to the date that notice of such call is sent as provided in Section 7(c);
and provided further, that the company may not call for redemption any Warrant
unless (i) on the date that notice of such call is sent as provided in Section 7(c),
the Warrant Shares underlying such Warrant are registered under a registration
statement that is effective under the Act or (ii) the holder of such Warrant
shall not have timely furnished to the Company such information regarding such
holder, its holdings of Common Stock, and its intended method of disposition of
the Warrant Shares underlying such Warrant as shall be reasonably required to
effect the registration of such Warrant Shares or shall not have executed such
documents in connection with such registration as the Company shall have
reasonably requested.

 

(b)                                If the company shall
determine to call less than all the Warrants then permitted to be redeemed
pursuant to Section 7(a) (“Eligible Warrants”), the Eligible Warrants
shall be called from each holder of Eligible Warrants in proportion to the number
of Eligible Warrants held by all such holders, subject to such adjustments as
the Company may determine to enable the Company to call a whole number of
Eligible Warrants from each such holder.

 

(c)                                 Notice of any call for
redemption shall be given to the Holder by the Company not less than 15 days
and not more than 45 days prior to the date established for such call (the “Call
Date”). Each such notice of call will (i) specify the Call Date, (ii) state
that payment of the Call Price will be made by the Company upon presentation and
surrender of this Warrant to the Company at its address as specified in the
notice, and (iii) state that the right to exercise the Warrants will terminate
at 5.00 P.M., US Eastern Standard Time, on the business day immediately
preceding the Call Date.

 

 

(d) Upon the
giving of the notice provided in Section 7(c), effective at the time
referred to in the section 7(c), the Warrants so called for redemption
will terminate and no longer be exercisable, and the holder thereof will have
no further rights with respect to such Warrants except to receive the Call
Price therefor.

 

8.                                       Elimination
of Fractional Interests

 

The Company
shall not be required upon the exercise of this Warrant to issue stock
certificates representing fractions of snares of Common Stock, but shall
instead pay in cash, in lieu of any fractional share of Common Stock to which
such holder would be entitled if such fractional shares were issuable, in an
amount equal to the fair market value of a Common Stock as of the date of such
exercise.

 

9.                                       Reservation
of Shares

 

The Company
shall at all times reserve and keep available out of its authorized shares of
Common Stock, solely for the purpose of issuance upon the exercise of this
Warrant, such number of shares of Common Stock as shall be issuable upon the
exercise of this Warrant and payment of the Exercise Price thereof, all shares
of Common Stock issuable upon such exercise shall be duly and validly issued,
fully paid and non-assessable.

 

10.                                 Notices

 

All notices,
requests, consents and other communications hereunder shall be in writing and
shall be deemed to have been duly made when delivered personally, or mailed by
registered or certified mail, return receipt requested, or telecopied or
telexed and confirmed in writing and delivered personally or mailed by
registered or certified mail, return receipt requested:

 

(a)                                  If the holder of this
warrant, to the address of such holder as shown on the books of the Company; or

 

(b)                                 If the Company, to the
address set forth in the introduction of this Warrant;

 

Or such other
address as the holder or the Company may hereafter have advised the other.

 

 

11.                               Successors.

 

All the
covenants, agreements, representations and warranties contained in this Warrant
shall bind the parties hereto and their respective heirs, executors,
administrators, distributees, successors and assigns.

 

12.                               Headings

 

The Section headings
in this Warrant have been inserted for purposes of convenience only and shall
have no substantive effect.

 

13.                               Law
Governing.

 

This Warrant shall
be construed and enforced in accordance with, and governed by, the laws of the
state of New York (not including the choice of law rules thereof) regardless of
the jurisdiction of creation or domicile of the Company or its successors or of
the holder of any time hereof.

 

IN WITNESS
WHEREOF, WorldWater, Corp. has caused this Warrant to be duly executed as of
the date first written above:

 

	
   

  	
  WorldWater Corp.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  	
  Quentin T. Kelly

  
	
   

  	
   

  	
  Chairman & CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
  Accepted and agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  

 

 

FORM B

 

THIS WARRANT
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR EXEMPTION
FROM REGISTRATION UNDER THE FOREGOING LAWS.

 

WARRANT
TO PURCHASE                 
SHARES OF COMMON

STOCK,
$.001 PAR VALUE PER SHARE

 

For VALUE
RECEIVED,                       
(“Warrantholder”), is entitled to purchase, subject to the provisions of
this Warrant, from WorldWater Corp., a Delaware corporation (“Company”),
at any time not later than 5:00 P.M., Eastern time, on the Expiration Date,                           ,
at an exercise price per share equal to $0.          
(the exercise price in effect being herein called the “Warrant
Price”),                                                                   
(“Warrant Shares”) of the Company’s Common Stock, par value $.001 per
share (“Common Stock”). The number of Warrant Shares purchasable upon
exercise of this Warrant and the Warrant Price shall be subject to adjustment
from time to time as described herein.

 

Section 1.
Registration. The Company shall maintain books
for the transfer and registration of the Warrant. Upon the initial issuance of
this Warrant, the Company shall issue and register the Warrant in the name of
the Warrantholder.

 

Section 2.
Transfers. As provided herein, this Warrant may
be transferred only pursuant to a registration statement filed under the
Securities Act of 1933, as amended (“Securities Act”), or an exemption
from such registration. Subject to such restrictions, the Company shall
transfer this Warrant from time to time upon the books to be maintained by the
Company for that purpose, upon surrender thereof for transfer properly endorsed
or accompanied by appropriate instructions for transfer and such other
documents as may be reasonably required by the Company, including, if required
by the Company, an opinion of its counsel to the effect that such transfer is
exempt from the registration requirements of the Securities Act of 1933, to
establish that such transfer is being made in accordance with the terms hereof,
and a new Warrant shall be issued to the transferee and the surrendered Warrant
shall be canceled by the Company. This Warrant shall be transferable by the
Warrantholder to investors in and officers, directors, members and managers of
the Warrantholder and the affiliates of any of the foregoing.

 

Section 3.
Exercise of Warrant. Subject to the provisions
hereof, the Warrantholder may exercise this Warrant in whole or in part at any
time upon surrender of the Warrant, together with delivery of the duly executed
Warrant exercise form attached hereto as Appendix A (the “Exercise Agreement”) and payment by cash,
certified check or wire transfer of funds for the aggregate Warrant Price for
that number of Warrant Shares then being purchased, to the

 

 

Company during
normal business hours on any Business Day at the Company’s principal executive
offices (or such other office or agency of the Company as it may designate by
notice to the holder hereof). The Warrant Shares so purchased shall be deemed
to be issued to the holder hereof or such holder’s designee, as the record
owner of such shares, as of the close of business on the date on which this
Warrant shall have been surrendered (or evidence of loss, theft or destruction
thereof and security or indemnity satisfactory to the Company), the Warrant
Price shall have been paid and the completed Exercise Agreement shall have been
delivered. Certificates for the Warrant Shares so purchased, representing the
aggregate number of shares specified in the Exercise Agreement, shall be
delivered to the holder hereof within a reasonable time, not exceeding three
(3) Business Days, after this Warrant shall have been so exercised. The
certificates so delivered shall be in such denominations as may be requested by
the holder hereof and shall be registered in the name of such holder or such
other name as shall be designated by such holder. If this Warrant shall have
been exercised only in part, then, unless this Warrant has expired, the Company
shall, at its expense, at the time of delivery of such certificates, deliver to
the holder a new Warrant representing the number of shares with respect to
which this Warrant shall not then have been exercised. As used herein, “Business
Day” means a day, other than a Saturday or Sunday, on which banks in New
York City are open for the general transaction of business.

 

Section 4.
Compliance with the Securities Act of 1933. The
Company may cause the legend set forth on the first page of this Warrant to be
set forth on each Warrant or similar legend on any security issued or issuable
upon exercise of this Warrant, unless counsel for the Company is of the opinion
as to any such security that such legend is unnecessary.

 

Section 5.
Payment of Taxes. The Company will pay any
documentary stamp taxes attributable to the initial issuance of Warrant Shares
issuable upon the exercise of the Warrant; provided, however, that the Company
shall not be required to pay any tax or taxes which may be payable in respect
of any transfer involved in the issuance or delivery of any certificates for
Warrant Shares in a name other than that of the registered holder of this
Warrant in respect of which such shares are issued, and in such case, the
Company shall not be required to issue or deliver any certificate for Warrant
Shares or any Warrant until the person requesting the same has paid to the
Company the amount of such tax or has established to the Company’s reasonable
satisfaction that such tax has been paid. The holder shall be responsible for
income and gift taxes due under federal, state or other law, if any such tax is
due.

 

Section 6.
Mutilated or Missing Warrants. In case this
Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall issue
in exchange and substitution of and upon cancellation of the mutilated Warrant,
or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant of like tenor and for the purchase of a like number of Warrant Shares,
but only upon receipt of evidence reasonably satisfactory to the Company of
such loss, theft or destruction of the Warrant, and with respect to a lost,
stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto,
if requested by the Company.

 

2

 

Section 7.
Reservation of Common Stock. The Company hereby
represents and warrants that there have been reserved, and the Company shall at
all applicable times keep reserved until issued (if necessary) as contemplated
by this Section 7, out of the authorized and unissued Common Stock,
sufficient shares to provide for the exercise of the rights of purchase
represented by this Warrant. The Company agrees that all Warrant Shares issued
upon exercise of the Warrant shall be, at the time of delivery of the
certificates for such Warrant Shares upon the due exercise of this Warrant,
duly authorized, validly issued, fully paid and non-assessable shares of Common
Stock of the Company.

 

Section 8.
Adjustments. Subject and pursuant to the
provisions of this Section 8, the Warrant Price and number of Warrant
Shares subject to this Warrant shall be subject to adjustment from time to time
as set forth hereinafter.

 

(a) (i) If the
Company shall, at any time or from time to time while this Warrant is
outstanding, pay a dividend or make a distribution on its Common Stock in
shares of Common Stock, subdivide its outstanding shares of Common Stock into a
greater number of shares or combine its outstanding shares of Common Stock into
a smaller number of shares or issue by reclassification of its outstanding
shares of Common Stock any shares of its capital stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing corporation), then the number of Warrant Shares
purchasable upon exercise of the Warrant and the Warrant Price in effect
immediately prior to the date upon which such change shall become effective,
shall be adjusted by the Company so that the Warrantholder thereafter
exercising the Warrant shall be entitled to receive the number of shares of
Common Stock or other capital stock which the Warrantholder would have received
if the Warrant had been exercised immediately prior to such event with an
inversely proportional adjustment in the Warrant Price. Such adjustments shall
be made successively whenever any event listed above shall occur.

 

(ii) If the
Company shall, at any time or from time to time while this Warrant is
outstanding, issue by reclassification of its outstanding shares of Common
Stock any shares of its capital stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing corporation), then, as a condition of such reclassification, lawful
and adequate provision shall be made whereby each Warrantholder shall
thereafter have the right to purchase and receive upon the basis and upon the
terms and conditions herein specified and in lieu of the Warrant Shares
immediately theretofore issuable upon exercise of the Warrant, such shares of
stock, securities or assets as would have been issuable or payable with respect
to or in exchange for a number of Warrant Shares equal to the number of Warrant
Shares immediately theretofore issuable upon exercise of the Warrant, had such
reclassification not taken place, and in any such case appropriate provision
shall be made with respect to the rights and interests of each Warrantholder to
the end that the provisions hereof (including, without limitation, provision
for adjustment of the Warrant Price) shall thereafter be applicable, as nearly
equivalent as may be practicable in relation to any shares of stock, securities
or properties thereafter deliverable upon the exercise thereof. The provisions
of this sub-paragraph (ii) shall similarly apply to successive
reclassifications.

 

3

 

(b)                                 If any capital
reorganization, reclassification of the capital stock of the Company,
consolidation or merger of the Company with another corporation in which the
Company is not the survivor, or sale, transfer or other disposition of all or
substantially all of the Company’s assets to another corporation shall be
effected, then, as a condition of such reorganization,   reclassification, consolidation, merger,
sale, transfer or other disposition, lawful and adequate provision shall be
made whereby each Warrantholder shall thereafter have the right to purchase and
receive upon the basis and upon the terms and conditions herein specified and
in lieu of the Warrant Shares immediately theretofore issuable upon exercise of
the Warrant, such shares of stock, securities or assets as would have been
issuable or payable with respect to or in exchange for a number of Warrant
Shares equal to the number of Warrant Shares immediately theretofore issuable
upon exercise of the Warrant, had such reorganization, reclassification,
consolidation, merger, sale, transfer or other disposition not taken place, and
in any such case appropriate provision shall be made with respect to the rights
and interests of each Warrantholder to the end that the provisions hereof
(including, without limitation, provision for adjustment of the Warrant Price)
shall thereafter be applicable, as nearly equivalent as may be practicable in
relation to any shares of stock, securities or properties thereafter
deliverable upon the exercise thereof.   
The Company shall not effect any such consolidation, merger, sale,
transfer or other disposition unless prior to or simultaneously with the
consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or entity
shall assume the obligation to deliver to the holder of the Warrant such shares
of stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase, and the other obligations under this
Warrant.  The provisions of this
paragraph (b) shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers, sales, transfers or other
dispositions.

 

(c)                                  In case the Company
shall fix a payment date for the making of a distribution to all holders of
Common Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing corporation) of
evidences of indebtedness or assets (other than cash dividends or cash distributions
payable out of consolidated earnings or earned surplus or dividends or distributions
referred to in Section 8(a)), or subscription rights or warrants, the
Warrant Price to be in effect after such payment date shall be determined by
multiplying the Warrant Price in effect immediately prior to such payment date
by a fraction, the numerator of which shall be the total number of shares of
Common Stock outstanding multiplied by the Fair Market Value (as defined below)
per share of Common Stock immediately prior to such payment date, less the fair
market value (as determined by the Company’s Board of Directors in good faith)
of said assets or evidences of indebtedness so distributed, or of such subscription
rights or warrants, and the denominator of which shall be the total number of shares
of Common Stock outstanding multiplied by such Fair Market Value per share of Common
Stock immediately prior to such payment date.  
Such adjustment shall be made successively whenever such a payment date
is fixed.

 

For all
purposes of this Warrant, the “Fair Market Value” of a share of
Common Stock as of a particular date (the “Valuation Date”) shall mean
the following: (v) if

 

4

 

the Common
Stock is then listed on a national stock exchange, the average closing price of
one share of Common Stock for the most recent five (5) trading sessions during
which the Common Stock has traded; (w) if the Common Stock is then included in
The Nasdaq Stock Market, Inc. (“Nasdaq”), the closing price of one share
of Common Stock for the most recent five (5) trading sessions during which the
Common Stock has traded; (x) if the Common Stock is then included in the
Over-the-Counter Bulletin Board, the average closing price of one share of
Common Stock for the most recent five (5) trading sessions during which the
Common Stock has traded; (y) if the Common Stock is then included in the “pink
sheets”, the average closing price of one share of Common Stock in the most
recent five (5) trading sessions during which the Common Stock has traded; or
(z) if the Common Stock is not then listed on a national stock exchange or
quoted on Nasdaq or the Over-the-Counter Bulletin Board or in the “pink sheets”,
the Fair Market Value of one share of Common Stock as of the Valuation Date
shall be determined in good faith by the Board of Directors of the Company and
the Warrantholder. The Board shall respond promptly in writing to an inquiry by
the Holder prior to the exercise hereunder as to the Fair Market Value of a
share of Common Stock. In the event that the Board of Directors of the Company
and the Warrantholder are unable to agree upon the Fair Market Value in respect
of subpart (z) hereof, the Company and the Warrantholder shall jointly select
an appraiser, who is experienced in such matters. The decision of such
appraiser shall be final and conclusive, and the cost of such appraiser shall
be borne evenly by the Company and the Warrantholder.

 

(d)                                For the term of this
Warrant, in addition to the provisions contained above, the Warrant Price shall
be subject to adjustment as provided below. An adjustment to the Warrant Price
shall become effective immediately after the payment date in the case of each
dividend or distribution and immediately after the effective date of each other
event which requires an adjustment.

 

(e)                                 hi the event that, as
a result of an adjustment made pursuant to this Section 8, the holder of
this Warrant shall become entitled to receive any shares of capital stock of
the Company other than shares of Common Stock, the number of such other shares so
receivable upon exercise of this Warrant shall be subject thereafter to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Warrant Shares contained in
this Warrant.

 

Section 9.
Fractional Interest. The Company shall not be
required to issue fractions of Warrant Shares upon the exercise of the Warrant.
If any fractional share of Common Stock would, except for the provisions of the
first sentence of this Section 9, be delivered upon such exercise, the
Company, in lieu of delivering such fractional share, shall pay to the
exercising holder of this Warrant an amount in cash equal to the Fair Market
Value of such fractional share of Common Stock on the date of exercise.

 

Section 10.
Notices to Warrantholder. Upon the happening of
any event requiring an adjustment of the Warrant Price, the Company shall
promptly give written notice thereof to the Warrantholder at the address
appearing in the records of the Company, stating the adjusted Warrant Price and
the adjusted number of Warrant Shares resulting from such event and setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is

 

5

 

based. Failure
to give such notice to the Warrantholder or any defect therein shall not affect
the legality or validity of the subject adjustment.

 

Section 11.
Identity of Transfer Agent. The Transfer Agent
for the Common Stock is the Company. Upon the appointment of any subsequent
transfer agent for the Common Stock or other shares of the Company’s capital
stock issuable upon the exercise of the rights of purchase represented by the
Warrant, the Company will mail to the Warrantholder a statement setting forth
the name and address of such transfer agent.

 

Section 12.
Notices. Unless otherwise provided, any notice
required or permitted under this Warrant shall be given in writing and shall be
deemed effectively given as hereinafter described (i) if given by personal
delivery, then such notice shall be deemed given upon such delivery, (ii) if
given by telex or telecopier, then such notice shall be deemed given upon
receipt of confirmation of complete transmittal, (iii) if given by mail, then
such notice shall be deemed given upon the earlier of (A) receipt of such
notice by the recipient or (B) three days after such notice is deposited in
first class mail, postage prepaid, and (iv) if given by an internationally
recognized overnight air courier, then such notice shall be deemed given one
day after delivery to such carrier. All notices shall be addressed as follows:
if to the Warrantholder, at its address as set forth in the Company’s books and
records and, if to the Company, at the address as follows, or at such other
address as the Warrantholder or the Company may designate by ten days’ advance
written notice to the other:

 

	
   

  	
  If to the Company to:

  	
   

  	
  World Water Corp.

  
	
   

  	
   

  	
   

  	
  55 Route 31 South

  Pennington, NJ 08543

  Fax: (609)818-0720

  Attn: Quentin T. Kelly

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  With a copy
  to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Salvo, Russell, Fichter & Landau

  510 Township Line Road Blue

  Bell, Pennsylvania 19422 Fax:

  (215) 653-0383 Attn: Stephen

  Salvo, Esq.

  

 

Section 13.
Registration Rights. The initial holder of this
Warrant is entitled to the benefit of certain registration rights in respect of
the Warrant Shares as provided in Registration Rights Agreement, and any
subsequent holder hereof may be entitled to such rights.

 

Section 14.
Successors. All the covenants and provisions
hereof by or for the benefit of the Warrantholder shall bind and inure to the
benefit of its respective successors and assigns hereunder.

 

Section 15.
Governing Law. This Warrant and all matters
arising directly or indirectly herefrom shall be governed by, and construed in
accordance with, the internal laws of the State of New Jersey, without
reference to the choice of law provisions thereof.

 

6

 

Section 16.
No Rights as Stockholder. Prior to the exercise
of this Warrant, the Warrantholder shall not have or exercise any rights as a
stockholder of the Company by virtue of its ownership of this Warrant.

 

Section 17.
Amendment; Waiver. Any term of this Warrant may
be amended or waived (including the adjustment provisions included in Section 8
of this Warrant) upon the written consent of the Company and the Warrantholder.

 

Section 18.
No Impairment of Rights. The Company will not,
by amendment of its Certificate of Incorporation or through any other means,
avoid or seek to avoid the observance or performance of any of the terms of
this Warrant, but will at all times in good faith assist in the carrying out of
all such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of this Warrant
against material impairment.

 

Section 19.
Section Headings. The section heading
in this Warrant are for the convenience of the Company and the Warrantholder
and in no way alter, modify, amend, limit or restrict the provisions hereof.

 

[SIGNATURE
PAGE FOLLOWS]

 

7

 

IN WITNESS
WHEREOF, the Company has caused this $0.     Warrant to be
duly executed, as of the          
day of             200   .

 

WORLDWATER CORP.

 

8

 

APPENDIX A
WARRANT EXERCISE FORM

 

To:                              

 

The
undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant (“Warrant”) for, and to purchase thereunder
by the payment of the Warrant Price and surrender of the Warrant,                               shares
of Common Stock (“Warrant Shares”) provided for therein, and requests that
certificates for the Warrant Shares be issued as follows:

 

	
   

  	
   

  	
   

  
	
   

  	
  Name

  
	
   

  	
   

  	
   

  
	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
   

  	
  Federal Tax ID or Social Security No.

  

 

	
   

  	
  and
  delivered by

  	
   

  	
  o       certified
  mail to the above address, or

  
	
   

  	
   

  	
  o       electronically
  (provide DWAC
  Instructions:                       ),
  or

  
	
   

  	
   

  	
  o       other
  (specify:                                                                         ).

  

 

and, if the
number of Warrant Shares shall not be all the Warrant Shares purchasable upon
exercise of the Warrant, that a new Warrant for the balance of the Warrant
Shares purchasable upon exercise of this Warrant be registered in the name of
the undersigned Warrantholder or the undersigned’s Assignee as below indicated
and delivered to the address stated below.

 

Dated:

 

 

	
  Note: The signature must correspond with
  the name of the registered holder as written on the first page of the Warrant
  in every particular, without alteration or enlargement or any change
  whatever, unless the Warrant has been assigned.

  	
   

  	
  Signature:

  
	
   

  
	
   

  	
   

  
	
  Name (please print)

  
	
   

  
	
   

  	
   

  
	
  Address

  
	
   

  
	
   

  	
   

  
	
  Federal Identification or Social Security
  No. Assignee:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						

 

17EXHIBIT 10.6

 

REGISTRATION RIGHTS AGREEMENT

 

Registration Rights Agreement dated as of                     
(this “Agreement”) by and between Worldwater Corp., a Delaware corporation (the
“Company”), and                        
(the “Purchaser”), with reference to the following:

 

A.                                   The
Company has issued to Purchaser (the “Warrants”) to purchase an aggregate of                      
shares of the Company’s Common Stock, pursuant to that certain                             
Agreement dated as of the date hereof.

 

B.                                     The
Company has agreed to provide with respect to the Common Stock issuable to
Purchaser upon execution of the Warrants certain registration rights under the
Securities Act.

 

NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

1.                                       Definitions

 

(A)                              As
used in this Agreement, the following terms shall have the meanings:

 

(1)                                  “Affiliate” of any specified Person means any other Person
who directly, or indirectly through one or more intermediaries, is in control
of, is controlled by, or is under common control with, such specified
Person.  For purposes of this definition,
control of a Person means the power, directly or indirectly, to direct or cause
the direction of the management and policies of such Person whether by
contract, securities, ownership or otherwise; and the terms “controlling” and “controlled”
have the respective meanings correlative to the foregoing.

 

(2)                                  “Commission” means the Securities and Exchange Commission.

 

(3)                                  “Exchange Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder, or any
similar successor statute.

 

(4)                                  “Holders” means Purchaser and any transferee or assignee of
Registrable Securities which agrees to become bound by all of the terms and
provisions of this Agreement in accordance with Section 8 hereof.

 

(5)                                  “Person” means any individual, partnership, corporation,
limited liability company, joint stock company, association, trust,
unincorporated organization, or a government or agency or political subdivision
thereof.

 

(6)                                  “Prospectus” means the prospectus (including, without
limitation, any preliminary prospectus and any final prospectus filed pursuant
to Rule 424(b) under the Securities Act, including any prospectus that
discloses information previously omitted from a prospectus filed as part of an
effective registration statement in reliance on Rule 430A under the Securities
Act) included in the Registration Statement, as amended or supplemented by any
prospectus supplement with respect to the terms of the offering of any portion
of the

 

1

 

Registrable Securities covered by the Registration
Statement and by all other amendments and supplements to such prospectus,
including all material incorporated by reference in such prospectus and all
documents filed after the date of such prospectus by the Company under the
Exchange Act and incorporated by reference therein.

 

(7)                                  “Public Offering” means an offer registered with the
Commission and the appropriate state securities commissions by the Company of
its Common Stock and made pursuant to the Securities Act.

 

(8)                                  “Registrable Securities” means the shares of Common Stock
issuable to Purchaser upon execution of the Warrants; provided, however, a
share of Common Stock shall cease to be a Registrable Security for purposes of
this Agreement when it no longer is a Restricted Security.

 

(9)                                  “Registration Statement” means a registration statement of
the Company filed on an appropriate form under the Securities Act providing for
the registration of, and the sale on a continuous or delayed basis by the
holders of, all of the Registrable Securities pursuant to Rule 415 under the
Securities Act, including the Prospectus contained therein and forming a part
thereof, any amendments to such registration statement and supplements to such
Prospectus, and all exhibits to and other material incorporated by reference in
such registration statement and Prospectus.

 

(10)                            “Restricted Security” means any share of Common Stock except
any such share that (i) has been registered pursuant to an effective
registration statement under the Securities Act and sold in a manner
contemplated by the prospectus included in such registration statement, (ii)
has been transferred in compliance with the resale provisions of Rule 144 under
the Securities Act (or any successor provision thereto) or is transferable
pursuant to paragraph (k) of Rule 144 under the Securities Act (or any
successor provision thereto) or (iii) otherwise has been transferred and a new
share of Common Stock not subject to transfer restrictions under the Securities
Act has been delivered by or on behalf of the Company.

 

(11)                            “Securities Act” means the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder, or any
similar successor statute.

 

2.                                       Registration

 

(A)                              Piggyback Rights. (i) If the Company proposes to register
any of its warrants, Common Stock or any other shares of common stock of the
Company under the Securities Act (other than a registration (A) on Form S-8 or
S-4 or any successor or similar forms, (B) relating to Common Stock or any
other shares of common stock of the Company issuable upon exercise of employee
share options or in connection with any employee benefit or similar plan of the
Company or (C) in connection with a direct or indirect acquisition by the
Company of another Person or any transaction with respect to which Rule 145 (or
any successor provision) under the Securities Act applies), whether or not for
sale for its own account, it will each such time, give prompt written notice at
least 20 days prior to the anticipated filing date of the registration
statement relating to such registration to each Holder, which notice shall set
forth such Holder’s rights under this Section 2(A) and shall offer such
Holder the opportunity to include in such registration statement such number of
Registrable Securities as such Holder may request.  Upon the written request of any Holder made
within 10 days after the receipt of notice from the Company (which request
shall specify the number of Registrable Securities intended to be disposed of
by such Holder), the Company will use its best efforts to effect the
registration under the Securities Act of all Registrable Securities that the
Company has been so requested to register by each Holder, to the extent
requisite to permit the disposition of the Registrable Securities so to be
registered; provided, however, that (A) if such registration involves a Public

 

2

 

Offering, each Holder must sell its Registrable
Securities to any underwriters selected by the Company with the consent of such
Holder on the same terms and conditions as apply to the Company and (B) if, at
any time after giving written notice of its intention to register any
Registrable Securities pursuant to this Section 2 and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register such
Registrable Securities, the Company shall give written notice to each Holder
and, thereupon, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration.

 

(ii)                                  If
a registration pursuant to this Section 2(A) involves a Public Offering
and the managing underwriter thereof advises the Company that, in its view, the
number of shares of Common Stock that the Company and the Holders intend to
include in such registration exceeds the largest number of shares of Common
Stock that can be sold without having an adverse effect on such Public Offering
(the “Maximum Offering Size”), the Company will include in such registration
only such number of shares of Common Stock as does not exceed the Maximum
Offering Size, and the number of shares in the Maximum Offering Size shall be
allocated among the Company, the Holders and any other sellers of Common Stock
in such Public Offering (“Third-Party Sellers”), first, to the Company until
all the shares of Common Stock originally proposed to be offered for sale by
the Company have been allocated, second, if the filing of the Registration
Statement was made upon the demand of any Third Party Seller, then pro rata
among such Third Party Sellers, and third, pro rata among the Holders and any
other Third-Party Sellers, in each case on the basis of the relative number of
shares of Common Stock originally proposed to be offered for sale under such
registration by each of the Holders and the Third-Party Sellers, as the case
may be.  If as a result of the proration
provisions of this Section 2(A)(ii), any Holder is not entitled to include
all such Registrable Securities in such registration, such Holder may elect to
withdraw its request to include any Registrable Securities in such
registration.  With respect to
registrations pursuant to this Section 2(A), the number of securities
required to satisfy any underwriters’ over-allotment option shall be allocated
among the Company, the Holders and any Third Party Seller pro rata on the basis
of the relative number of securities offered for sale under such registration
by each of the Holders, the Company and any such Third Party Sellers before the
exercise of such over-allotment option.

 

3.                                       Obligations
of the Company

 

In connection with the registration of the Registrable
Securities, the Company shall:

 

(A)                              Promptly
(i) prepare and file with the Commission such amendments (including
post-effective amendments) to the Registration Statement and supplements to the
Prospectus as may be necessary to keep the Registration Statement continuously
effective and in compliance with the provisions of the Securities Act
applicable thereto so as to permit the Prospectus forming part thereof to be
current and useable by Holders for resales of the Registrable Securities for a
period of one (1) year from the date on which the Registration Statement is
first declared effective by the Commission (the “Effective Time”) or such
shorter period that will terminate when all the Registrable Securities covered
by the Registration Statement have been sold pursuant thereto in accordance
with the plan of distribution provided in the Prospectus, transferred pursuant
to Rule 144 under the Securities Act or otherwise transferred in a manner that
results in the delivery of new securities not subject to transfer restrictions
under the Securities Act (the “Registration Period”) and (ii) take all lawful
action such that each of (A) the Registration Statement and any amendment
thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, not misleading and (B) the Prospectus
forming part of the Registration Statement, and any amendment or supplement
thereto, does not at any time during the Registration Period include an untrue
statement 

 

3

 

of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;

 

(B)                                During
the Registration Period, comply with the provisions of the Securities Act with
respect to the Registrable Securities of the Company covered by the
Registration Statement until such time as all of such Registrable Securities
have been disposed of in accordance with the intended methods of disposition by
the Holders as set forth in the Prospectus forming part of the Registration
Statement;

 

(C)                                (i)
Prior to the filing with the Commission of any Registration Statement
(including any amendments thereto) and the distribution or delivery of any
Prospectus (including any supplements thereto), provide (A) draft copies
thereof to the Holders and reflect in such documents all such comments as the
Holders (and their counsel) reasonably may propose and (B) to the Holders a
copy of the accountant’s consent letter to be included in the filing and (ii)
furnish to each Holder whose Registrable Securities are included in the
Registration Statement and its legal counsel identified to the Company, (A)
promptly after the same is prepared and publicly distributed, filed with the
Commission, or received by the Company, one copy of the Registration Statement,
each Prospectus, and each amendment or supplement thereto and (B) such number
of copies of the Prospectus and all amendments and supplements thereto and such
other documents, as such Holder may reasonably request in order to facilitate
the disposition of the Registrable Securities owned by such Holder;

 

(D)                               (i)
Register or qualify the Registrable Securities covered by the Registration
Statement under such securities or “blue sky” laws of such jurisdictions as the
Holders who hold a majority-in-interest of the Registrable Securities being
offered reasonably request, (ii) prepare and file in such jurisdictions such
amendments (including post-effective amendments) and supplements to such registrations
and qualifications as may be necessary to maintain the effectiveness thereof at
all times during the Registration Period, (iii) take all such other lawful
actions as may be necessary to maintain such registrations and qualifications
in effect at all times during the Registration Period and (iv) take all such
other lawful actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided, however, that
the Company shall not be required in connection therewith or as a condition
thereto to (A) qualify to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(D), (B) subject
itself to general taxation in any such jurisdiction or (C) file a general
consent to service of process in any such jurisdiction;

 

(E)                                 As
promptly as practicable after becoming aware of such event, notify each Holder
of the occurrence of any event, as a result of which the Prospectus included in
the Registration Statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, and promptly prepare an amendment
to the Registration Statement and supplement to the Prospectus to correct such
untrue statement or omission, and deliver a number of copies of such supplement
and amendment to each Holder as such Holder may reasonably request;

 

(F)                                 As
promptly as practicable after becoming aware of such event, notify each Holder
who holds Registrable Securities being sold (or, in the event of an
underwritten offering, the managing underwriters) of the issuance by the
Commission of any stop order or other suspension of the effectiveness of the
Registration Statement at the earliest possible time and take all lawful action
to effect the withdrawal, recession or removal of such stop order or other
suspension;

 

(G)                                Cause
all the Registrable Securities covered by the Registration Statement to be
listed on the principal national securities exchange, and included in an
inter-dealer quotation system of a registered national

 

4

 

securities association, on or in which securities of
the same class or series issued by the Company are then listed or included;

 

(H)                               Maintain
a transfer agent and registrar, which may be a single entity, for the
Registrable Securities not later than the effective date of the Registration Statement;

 

(I)                                    Cooperate
with the Holders who hold Registrable Securities being offered to facilitate
the timely preparation and delivery of certificates for the Registrable
Securities to be offered pursuant to the registration statement and enable such
certificates for the Registrable Securities to be in such denominations or
amounts, as the case may be, as the Holders reasonably may request and
registered in such names as the Holder may request; and, within three (3)
business days after a registration statement which includes Registrable
Securities is declared effective by the Commission, deliver and cause legal
counsel selected by the Company to deliver to the transfer agent for the
Registrable Securities (with copies to the Holders whose Registrable Securities
are included in such registration statement) an appropriate instruction and, to
the extent necessary, an opinion of such counsel;

 

(J)                                   Take
all such other lawful actions reasonably necessary to expedite and facilitate
the disposition by the Holders of their Registrable Securities in accordance
with the intended methods therefor provided in the Prospectus which are
customary under the circumstances;

 

(K)                               Make
generally available to its security holders as soon as practicable, but in any
event not later than three (3) months after (i) the effective date (as defined
in Rule 158(c) under the Securities Act) of the Registration Statement and (ii)
the effective date of each post-effective amendment to the Registration
Statement, as the case may be, an earnings statement of the Company and its
subsidiaries complying with Section 11 (a) of the Securities Act and the
rules and regulations of the Commission thereunder (including, at the option of
the Company, Rule 158);

 

(L)                                 In
the event of an underwritten offering, promptly include or incorporate in a
Prospectus supplement or post-effective amendment to the Registration Statement
such information as the managers reasonably agree should be included therein
and to which the Company does not reasonably object and make all required
filings of such Prospectus supplement or post-effective amendment as soon as
practicable after it is notified of the matters to be included or incorporated
in such Prospectus supplement or post-effective amendment;

 

(M)                            (i)
Make reasonably available for inspection by the Holders, any underwriter
participating in any disposition pursuant to the Registration Statement, and
any attorney, accountant or other agent retained by such Holders or any such
underwriter all relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries, and (ii) cause
the Company’s officers, directors and employees to supply all information
reasonably requested by such Holders or any such underwriter, attorney, accountant
or agent in connection with the Registration Statement, in each case, as is
customary for similar due diligence examinations; provided, however, that all
records, information and documents that are designated in writing by the
Company, in good faith, as confidential, proprietary or containing any material
nonpublic information shall be kept confidential and shall not be used as a
basis for any market transactions in the securities of the Company by such
Holders and any such underwriter, attorney, accountant or agent (pursuant to an
appropriate confidentiality agreement in the case of any such holder or agent),
unless such disclosure is made pursuant to judicial process in a court
proceeding (after first giving the Company an opportunity promptly to seek a
protective order or otherwise limit the scope of the information sought to be
disclosed) or is required by law, or such records, information or documents
become available to the public generally or through a third party not in
violation of an accompanying 

 

5

 

obligation of confidentiality; and provided, further,
that, if the foregoing inspection and information gathering would otherwise
disrupt the Company’s conduct of its business, such inspection and information
gathering shall, to the maximum extent possible, be coordinated on behalf of
the Holders and the other parties entitled thereto by one firm of counsel
designed by and on behalf of the majority in interest of Holders and other
parties;

 

(N)                               In
connection with any underwritten offering, make such representations and
warranties to the Holders participating in such underwritten offering and to
the managers, in form, substance and scope as are customarily made by the
Company to underwriters in secondary underwritten offerings;

 

(O)                               In
connection with any underwritten offering, obtain opinions of counsel to the
Company (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managers) addressed to the underwriters,
covering such matters as are customarily covered in opinions requested in
secondary underwritten offerings (it being agreed that the matters to be
covered by such opinions shall include, without limitation, as of the date of
the opinion and as of the Effective Time of the Registration Statement or most
recent post-effective amendment thereto, as the case may be, the absence from
the Registration Statement and the Prospectus, including any documents
incorporated by reference therein, of an untrue statement of a material fact or
the omission of a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading, subject to customary
limitations);

 

(P)                                 In
connection with any underwritten offering, obtain “cold comfort” letters and
updates thereof from the independent public accountants of the Company (and, if
necessary, from the independent public accountants of any subsidiary of the
Company or of any business acquired by the Company, in each case for which
financial statements and financial data are, or are required to be, included in
the Registration Statement), addressed to each underwriter participating in
such underwritten offering (if such underwriter has provided such letter,
representations or documentation, if any, required for such cold comfort letter
to be so addressed), in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with secondary
underwritten offerings;

 

(Q)                               In
connection with any underwritten offering, deliver such documents and
certificates as may be reasonably required by the managers, if any, and

 

(R)                                In
the event that any broker-dealer registered under the Exchange Act shall be an “Affiliate”
(as defined in Rule 2729(b)(1) of the rules and regulations of the National
Association of Securities Dealers, Inc. (the “NASD Rules”) (or any successor
provision thereto)) of the Company or has a “conflict of interest” (as defined
in Rule 2720(b)(7) of the NASD Rules (or any successor provision thereto)) and
such broker-dealer shall underwrite, participate as a member of an underwriting
syndicate or selling group or assist in the distribution of any Registrable
Securities covered by the Registration Statement, whether as a holder of such
Registrable Securities or as an underwriter, a placement or sales agent or a
broker or dealer in respect thereof, or otherwise, the Company shall assist
such broker-dealer in complying with the requirements of the NASD Rules,
including, without limitation, by (A) engaging a “qualified independent
underwriter” (as defined in Rule 2720(b)(15) of the NASD Rules (or any
successor provision thereto)) to participate in the preparation of the
Registration Statement relating to such Registrable Securities, to exercise
usual standards of due diligence in respect thereof and to recommend the public
offering price of such Registrable Securities, (B) indemnifying such qualified
independent underwriter to the extent of the indemnification of underwriters
provided in Section 6 hereof and (C) providing such information to such
broker-dealer as may be required in order for such broker-dealer to comply with
the requirements of the NASD Rules.

 

6

 

4.                                       Obligations
of the Holders

 

In connection with the registration of the Registrable
Securities, the Holders shall have the following obligations:

 

(A)                              It
shall be a condition precedent to the obligations of the Company to complete
the registration pursuant to this Agreement with respect to the Registrable
Securities of a particular Holder that such Holder shall furnish to the Company
such information regarding itself, the Registrable Securities held by it and
the intended method of disposition of the Registrable Securities held by it as
shall be reasonably required to effect the registration of such Registrable
Securities and shall execute such documents in connection with such
registration as the Company may reasonably request;

 

(B)                                Each
Holder by its acceptance of the Registrable Securities agrees to cooperate with
the Company in connection with the preparation and filing of the Registration
Statement hereunder, unless such Holder has notified the Company in writing of
its election to exclude all of its Registrable Securities from the Registration
Statement; and

 

(C)                                Each
Holder agrees that, upon receipt of any notice from the Company of the
occurrence of any event of the kind described in Section 3(E) or 3(F), it
shall immediately discontinue its disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities
until such Holder’s receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 3(E) and, if so directed by the
Company, such Holder shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies in such Holder’s possession, of the Prospectus covering such Registrable
Securities current at the time of receipt of such notice.

 

(D)                               In
the case of an underwritten public offering of the Company’s securities, at the
request of the underwriter, each Holder will agree not to publicly sell that
amount of Registrable Securities as designated by the underwriter for such
period (not to exceed 180 days) as also designated by such underwriter.

 

5.                                       Expenses
of Registration

 

All expenses, other than underwriting discounts and
commissions, incurred in connection with registrations, filings or
qualifications pursuant to Section 3, but including, without limitation,
all registration, listing, and qualifications fees, printing and engraving
fees, accounting fees, and the fees and disbursements of counsel for the
Company and Holder, shall be borne by the Company.

 

6.                                       Indemnification
and Contribution

 

(A)                              The
Company shall indemnify and hold harmless each Holder and each underwriter, if
any, which facilitates the disposition of Registrable Securities, and each of
their respective officers and directors and each person who controls such
Holder or underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (each such person being sometimes
hereinafter referred to as an “Indemnified Person”)
from and against any losses, claims, damages or liabilities, joint or several,
to which such Indemnified Person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or an omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, not
misleading, or arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any

 

7

 

Prospectus or an omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and the Company hereby agrees to reimburse such
Indemnified Person for all reasonable legal and other expenses incurred by them
in connection with investigating or defending any such action or claim as and
when such expenses are incurred; provided, however, that the Company shall not
be liable to any such Indemnified Person in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon (i) an
untrue statement or alleged untrue statement made in, or an omission or alleged
omission from, such Registration Statement or Prospectus in reliance upon and
in conformity with written information furnished to the Company by such
Indemnified Person expressly for use therein or (ii) in the case of the
occurrence of an event of the type specified in Section 3(E), the use by
the Indemnified Person of an outdated or defective Prospectus after the Company
has provided to such Indemnified Person an updated Prospectus correcting the
untrue statement or alleged untrue statement or omission or alleged omission
giving rise to such loss, claim, damage or liability.

 

(B)                                Indemnification by the Holders and Underwriters.  Each Holder agrees, as a consequence of the
inclusion of any of its Registrable Securities in a Registration Statement, and
each underwriter, if any, which facilitates the disposition of Registrable
Securities shall agree, as a consequence of facilitating such disposition of
Registrable Securities, severally and not jointly, to (i) indemnify and hold
harmless the Company, its directors (including any person who, with his or her
consent, is named in the Registration Statement as a director nominee of the
Company), its officers who sign any Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15 of
the Securities Act or Section 20 of the Exchange Act, against any losses,
claims, damages or liabilities to which the Company or such other persons may
become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in such Registration Statement or Prospectus or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(in light of the circumstances under which they were made, in the case of the
Prospectus), not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such holder or underwriter expressly
for use therein; provided, however, that no Holder or underwriter shall be
liable under this Section 6(B) for any amount in excess of the net
proceeds paid to such Holder or underwriter in respect of shares sold by it and
(ii) reimburse the Company for any legal or other expenses incurred by the
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.  The
obligations pursuant to this subsection shall survive the transfer of the
Registrable Securities.

 

(C)                                Notice of Claims, etc. 
Promptly after receipt by a party seeking indemnification pursuant to
this Section 6 (an “Indemnified Party”) of written notice of any
investigation, claim, proceeding or other action in respect of which
indemnification is being sought (each, a “Claim”), the Indemnified Party
promptly shall notify the party against whom indemnification pursuant to this Section 6
is being sought (the “Indemnifying Party”) of the commencement thereof; but the
omission to so notify the Indemnifying Party shall not relieve it from any
liability that it otherwise may have to the Indemnified Party, except to the
extent that the Indemnifying Party is materially prejudiced and forfeits
substantive rights and defenses by reason of such failure.  In connection with any Claim as to which both
the Indemnifying Party and the Indemnified Party are parties, the Indemnifying
Party shall be entitled to assume the defense thereof.  Notwithstanding the assumption of the defense
of any Claim by the Indemnifying Party, the Indemnified Party shall have the
right to employ separate legal counsel and to participate in the defense of
such Claim, and the Indemnifying Party shall bear the reasonable fees,
out-of-pocket costs and expenses of such separate legal counsel to the
Indemnified Party if (and only if): (x) the Indemnifying Party shall have
agreed to pay such fees, costs and expenses, (y) the Indemnified Party and the
Indemnifying Party shall

 

8

 

reasonably have concluded that representation of the
Indemnified Party by the Indemnifying Party by the same legal counsel would not
be appropriate due to actual or, as reasonably determined by legal counsel to
the Indemnified Party, potentially differing interests between such parties in
the conduct of the defense of such Claim, or if there may be legal defenses
available to the Indemnified Party that are in addition to or disparate from
those available to the Indemnifying Party or (z) the Indemnifying Party shall
have failed to employ legal counsel reasonably satisfactory to the Indemnified
Party within a reasonable period of time after notice of the commencement of
such Claim.  If the Indemnified Party
employs separate legal counsel in circumstances other than as described in
clauses (x), (y) or (z) above, the fees, costs and expenses of such legal
counsel shall be born exclusively by the Indemnified Party.  Except as provided above, the Indemnifying
Party shall not, in connection with any Claim in the same jurisdiction, be
liable for the fees and expenses of more than one firm of counsel for the Indemnified
Party (together with appropriate local counsel).  The Indemnified Party shall not, without the
prior written consent of the Indemnifying Party (which consent shall not
unreasonably be withheld), settle or compromise any Claim or consent to the entry
of any judgment that does not include an unconditional release of the
Indemnifying Party from all liabilities with respect to such Claim or judgment.

 

(D)                               Contribution.  If the
indemnification provided for in this Section 6 is unavailable to or insufficient
to hold harmless an Indemnified Person under subsection (A) or (B) above
in respect of any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each Indemnifying Party shall contribute to
the amount paid or payable by such Indemnified Party as a result of such
losses, claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party and the Indemnified Party in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations.  The relative fault of such Indemnifying Party
and Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to information supplied by
such Indemnifying Party or by such Indemnified Party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.  The parties
hereto agree that it would not be just and equitable if contribution pursuant
to this Section 6(D) were determined by pro rata allocation (even if the
Holders or any underwriters were treated as one entity for such purpose) or by
any other method of allocation which does not take account of the equitable
considerations referred to in this Section 6(D).  The amount paid or payable by an Indemnified
Party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above shall be deemed to include any legal or
other fees or expenses reasonably incurred by such Indemnified Party in
connection with investigating or defending any such action or claim.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.  The
obligations of the Holders and any underwriters in this Section 6(D) to
contribute shall be several in proportion to the percentage of Registrable
Securities registered or underwritten, as the case may be, by them and not
joint.

 

(E)                                 Notwithstanding
any other provision of this Section 6, in no event shall any (i) Holder be
required to undertake liability to any person under this Section 6 for any
amounts in excess of the dollar amount of the proceeds to be received by such
Holder from the sale of such Holder’s Registrable Securities (after deducting
any fees, discounts and commissions applicable thereto) pursuant to any
Registration Statement under which such Registrable Securities are to be
registered under the Securities Act and (ii) underwriter be required to
undertake liability to any Person hereunder for any amounts in excess of the
aggregate discount, commission or other compensation payable to such
underwriter with respect to the Registrable Securities underwritten by it and
distributed pursuant to the Registration Statement.

 

9

 

(F)                                 The
obligations of the Company under this Section 6 shall be in addition to
any liability which the Company may otherwise have to any Indemnified Person
and the obligations of any Indemnified Person under this Section 6 shall
be in addition to any liability which such Indemnified Person may otherwise
have to the Company.  The remedies
provided in this Section 6 are not exclusive and shall not limit any
rights or remedies which may otherwise be available to an indemnified party at
law or in equity.

 

7.                                       Rule 144

 

With a view to making available to the Holders the
benefits of Rule 144 under the Securities Act or any other similar rule or
regulation of the Commission that may at any time permit the Holders to sell
securities of the Company to the public without registration (“Rule 144”), the
Company agrees to use its best efforts to:

 

(1)                                  comply
with the provisions of paragraph (c) (1) of Rule 144 and

 

(2)                                  file
with the Commission in a timely manner all reports and other documents required
to be filed by the Company pursuant to Section 13 or 15(d) under the
Exchange Act; and, if at any time it is not required to file such reports but
in the past had been required to or did file such reports, it will, upon the
request of any Holder, make available other information as required by, and so
long as necessary to permit sales of, its Registrable Securities pursuant to
Rule 144.

 

8.                                       Assignment

 

The rights to have the Company register Registrable
Securities pursuant to this Agreement shall be automatically assigned by the
Holders to any permitted transferee of all or any portion of such Registrable
Securities only if (a) the Holder agrees in writing with the transferee or
assignee to assign such rights, and a copy of such agreement is furnished to
the Company within a reasonable time after such assignment, (b) the Company is,
within a reasonable time after such transfer or assignment, furnished with
written notice of (i) the name and address of such transferee or assignee and
(ii) the securities with respect to which such registration rights are being
transferred or assigned, (c) immediately following such transfer or assignment,
the securities so transferred or assigned to the transferee or assignee
constitute Restricted Securities, (d) at or before the time the Company
received the written notice contemplated by clause (b) of this sentence the
transferee or assignee agrees in writing with the Company to be bound by all of
the provisions contained herein and (e) any such transfer or assignment is
performed in compliance with all Federal and state securities laws and
regulations.

 

9.                                       Amendment
and Waiver

 

Any provision of this Agreement may be amended and the
observance thereof may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the written consent of
the Company and Holders who hold a majority-in-interest of the Registrable
Securities.  Any amendment or waiver
effected in accordance with this Section 9 shall be binding upon each
Holder and the Company.

 

10.                                 Changes
in Common Stock

 

If, and as often as, there are any changes in the
Common Stock by way of stock split, stock dividend, reverse split, combination
or reclassification, or through merger, consolidation, reorganization or
recapitalization, or by any other means, appropriate adjustment shall be made
in the provisions hereof, as may be required, so that the rights and privileges
granted hereby shall continue with respect to the Common Stock as so changed.

 

10

 

11.                                 Miscellaneous

 

(A)                              A
person or entity shall be deemed to be a holder of Registrable Securities
whenever such person or entity owns of record such Registrable Securities.  If the Company receives conflicting
instructions, notices or elections from two or more persons or entities with
respect to the same Registrable Securities, the Company shall act upon the
basis of instructions, notice or election received from the registered owner of
such Registrable Securities.

 

(B)                                Except
as may be otherwise provided herein, any notice or other communication or
delivery required or permitted hereunder shall be in writing and shall be
delivered personally, or sent by telecopier machine or by a nationally
recognized overnight courier service, and shall be deemed given when so
delivered personally, or by telecopier machine or overnight courier service as
follows:

 

 

 

	
   

  	
  (1)

  	
  if to the Company, to:

  
	
   

  	
   

  
	
   

  	
   

  	
  Worldwater Corp.

  
	
   

  	
   

  	
  Pennington Business Park

  
	
   

  	
   

  	
  55 Route 31 South

  
	
   

  	
   

  	
  Pennington, New Jersey

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  President

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  609-818-0720

  
						

 

(2)                                  if
to any Holder, at such address as such Holder shall have provided in writing to
the Company or as set forth on the signature page.

 

The Company, or any Holder may change the foregoing
address by notice given pursuant to this Section 11(B).

 

(C)                                Failure
of any party to exercise any right or remedy under this Agreement or otherwise,
or delay by a party in exercising such right or remedy, shall not operate as a
waiver thereof.

 

(D)                               This
Agreement shall be governed by and interpreted in accordance with the laws of
the State of California.  Each of the
parties consents to the jurisdiction of the federal courts or the state courts
of the State of California sitting in the City of Los Angeles, California in
connection with any dispute arising under this Agreement and hereby waives, to
the maximum extent permitted by law, any objection including any objection
based on forum non conveniens, to the bringing of any such proceeding in such
jurisdictions.

 

(E)                                 The
remedies provided in this Agreement are cumulative and not exclusive of any
remedies provided by law.  If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction.  It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,

 

11

 

provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.

 

(F)                                 This
Agreement, constitutes the entire agreement among the parties hereto with
respect to the subject matter hereof. 
There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein. 
This Agreement supersede all prior agreements and undertakings among the
parties hereto with respect to the subject matter hereof.

 

(G)                                Subject
to the requirements of Section 8 hereof, this Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties hereto.

 

(H)                               All
pronouns and any variations thereof refer to the masculine, feminine or neuter,
singular or plural, as the context may require.

 

(I)                                    The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning thereof.

 

(J)                                   This
Agreement may be executed in two (2) counterparts, each of which shall be
deemed an original but both of which shall constitute one and the same
agreement.  A facsimile transmission of
this signed Agreement shall be legal and binding on the parties hereto.

 

(K)                               The
Company shall not grant to any other party registration rights which are
superior to or on parity with the registration rights granted hereunder.

 

12

 

IN WITNESS WHEREOF, the parties hereto have duly
caused this Agreement to be executed and delivered on the date first above
written.

 

 

	
   

  	
   

  	
  Worldwater Corp., a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  PURCHASER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
									

 

13

 

NEITHER THESE SECURITIES NOR THE SECURITIES
INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS
UNLESS OFFERED, SOLD OR TRANSFERRED UNDER AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS. NOTWITHSTANDING THE FOREGOING, THESE SECURITIES AND
THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING
ARRANGEMENT SECURED BY SUCH SECURITIES.

 

 

Date:                          

 

 

14

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