Document:

SUBSCRIPTION
      AGREEMENT

     

    BETWEEN

     

    ELECTRIC
      AQUAGENICS UNLIMITED INC.

     

    AND

     

    THE
      INVESTOR NAMED HEREIN

     

    MAY
      1, 2006

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Table
      of Contents

    

      
        	
                1.
                  

              	
                 Purchase
                  and Sale of the Shares.

              	
                1

              
	
                1.1

              	 	
                Sale
                  and Issuance of the Shares.

              	 
	
                1.2

              	 	
                Closing

              	
                1

              
	
                1.3

              	 	
                Use
                  of Proceeds

              	
                2

              
	
                2.
                  

              	 Representations
                and Warranties of the Company	
                2

              
	
                2.1

              	 	
                Organization,
                  Good Standing and Qualification

              	
                2

              
	
                2.2

              	 	
                Capitalization

              	
                3

              
	
                2.3

              	 	
                Subsidiaries;
                  Joint Ventures

              	
                3

              
	
                2.4

              	 	
                Authorization

              	
                3

              
	
                2.5

              	 	
                Governmental
                  Consents

              	
                3

              
	
                2.6

              	 	
                Offering

              	
                3

              
	
                2.7

              	 	
                Litigation

              	
                3

              
	
                2.8

              	 	
                Absence
                  of Certain Developments

              	
                4

              
	
                2.9

              	 	
                Proprietary
                  Information Agreements

              	
                4

              
	
                2.10

              	 	
                Patents
                  and Trademarks

              	
                5

              
	
                2.11
                  

              	 	
                Compliance
                  with Other Instruments

              	
                5

              
	
                2.12

              	 	
                Related-Party
                  Transactions

              	
                5

              
	
                2.13

              	 	
                Business
                  Plan

              	
                6

              
	
                2.14

              	 	
                Tax
                  Returns

              	
                6

              
	
                2.15

              	 	
                Permits

              	
                6

              
	
                2.16

              	 	
                Environmental
                  and Safety Laws

              	
                6

              
	
                2.17

              	 	
                Registration
                  Rights

              	
                6

              
	
                2.18

              	 	
                Corporate
                  Documents; Minute Books

              	
                6

              
	
                2.19
                  

              	 	
                Title
                  to Property and Assets

              	
                6

              
	
                2.20

              	 	
                Insurance

              	
                6

              
	
                2.21

              	 	
                Labor
                  Agreements and Actions

              	
                6

              
	
                2.22

              	 	
                Obligations
                  of Management

              	
                7

              
	
                2.23

              	 	
                Disclosure

              	
                7

              
	
                2.24

              	 	
                No
                  Brokerage.

              	
                7

              
	
                3.
                  

              	 Representations
                and Warranties of the Investor	
                7

              
	
                3.1

              	 	
                Authorization

              	
                7

              
	
                3.2

              	 	
                Purchase
                  Entirely for Own Account

              	
                7

              
	
                3.3

              	 	
                Accredited
                  Investor

              	
                8

              
	
                3.4

              	 	
                Restricted
                  Securities

              	
                8

              
	
                3.5

              	 	
                Legends

              	
                8

              
	
                4.
                  

              	 Conditions
                of Investor’s Obligations at Closing	
                8

              
	
                4.1

              	 	
                Representations
                  and Warranties

              	
                8

              
	
                4.2

              	 	
                Performance

              	
                8

              
	
                4.3

              	 	
                Proceedings
                  and Documents

              	
                8

              

      

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      
        	
                4.4

              	
                 

              	
                Fees
                  of Counsel

              	
                8

              
	
                4.5

              	
                 

              	
                Warrant
                  Agreement

              	
                9

              
	
                4.6

              	
                 

              	
                Share
                  Certificate

              	
                9

              
	
                4.7

              	
                 

              	
                Registration
                  Rights Agreement

              	
                9

              
	
                4.8

              	
                 

              	
                Amended
                  and Restated License and Distribution Agreement

              	
                9

              
	
                5.
                  

              	 Conditions
                of the Company’s Obligations at Closing	
                9

              
	
                5.1

              	 	
                Representations
                  and Warranties

              	
                9

              
	
                5.2

              	 	
                Payment
                  of Purchase Price

              	
                9

              
	
                6.
                  

              	 Miscellaneous.	
                9

              
	
                6.1

              	 	
                Indemnification

              	
                9

              
	
                6.2

              	 	
                SEC
                  Filings

              	
                10

              
	
                6.3

              	 	
                Pre-emptive
                  Rights

              	
                10

              
	
                6.4

              	 	
                Survival

              	
                10

              
	
                6.5

              	 	
                Successors
                  and Assigns

              	
                10

              
	
                6.6

              	 	
                Governing
                  Law

              	
                10

              
	
                6.7

              	 	
                Arbitration

              	
                11

              
	
                6.8

              	 	
                Titles
                  and Subtitles

              	
                11

              
	
                6.9
                  

              	 	
                Notices

              	
                11

              
	
                6.10

              	 	
                No
                  Brokers

              	
                12

              
	
                6.11

              	 	
                Expenses

              	
                12

              
	
                6.12

              	 	
                Amendments
                  and Waivers

              	
                12

              
	
                6.13

              	 	
                Severability

              	
                12

              
	
                6.14

              	 	
                Entire
                  Agreement

              	
                12

              
	
                6.15

              	 	
                Further
                  Assurances

              	
                12

              
	
                6.16

              	 	
                Counterparts

              	
                12

              
	
                6.17

              	 	
                Construction

              	
                13

              

      

       

      Exhibits:

       

      
        
          	
                  Exhibit
                    A - 

                	
                  Warrant
                    Agreement

                
	
                  Exhibit
                    B - 

                	
                  Capitalization

                
	
                  Exhibit
                    C - 

                	
                  Registration
                    Rights Agreement

                
	
                  Exhibit
                    D - 

                	
                  Amended
                    and Restated License and Distribution
                    Agreement

                

        

      

       

      Schedules:

      

        
          	
                  Schedule
                    2.3 - 

                	
                  Subsidiaries
                    and Joint Ventures

                
	
                  Schedule
                    2.9 -

                	
                  Non-Proprietary
                    Information

                
	
                  Schedule
                    2.13 -

                	
                  Business
                    Plan

                
	
                  Schedule
                    2.17 - 

                	
                  Registration
                    Rights

                
	
                  Schedule
                    2.21 - 

                	
                  Employment
                    Agreements

                

        

         

      

      
        
          
          

        

        
          ii

          
            

          

        

        
          
          

        

         

      

      SUBSCRIPTION
        AGREEMENT

       

      This
        Subscription Agreement (this “Agreement”)
        is
        made as of May 1, 2006, by and among Electric Aquagenics Unlimited Inc.,
        a
        Delaware corporation (the “Company”),
        Water
        Science, LLC, a Florida limited liability company (the “Investor”).

       

      WITNESSETH:

       

      WHEREAS,
        the Investor desires to purchase, and the Company desires to sell, 1,600,000
        shares of common stock of the Company (the “Shares”)
        at the
        price and on the terms and conditions set forth herein;

       

      WHEREAS,
        the Company is willing to make the representations and warranties and to
        undertake the obligations hereinafter set forth in connection with such
        investment;

       

      WHEREAS,
        as a further incentive for Purchaser to purchase the Shares, Seller shall
        deliver to Purchaser a warrant to purchase 6,400,000 shares of its common
        stock
        (the “Warrants”)
        at an
        exercise price of $2.76 per share, in accordance with the terms and conditions
        of the Warrant Agreement between the parties, a copy of which is attached
        hereto
        as Exhibit A
        and
        incorporated herein by reference.

       

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

       

      1. Purchase
        and Sale of the Shares.

       

      1.1 Sale
        and
        Issuance of the Shares.

       

      (a)
         Subject
        to the terms and conditions of this Agreement, the Investor agrees to purchase,
        and the Company agrees to sell and issue to the Investor, [1,600,000] Shares
        for
        an aggregate purchase price of Four Million and 00/100 U.S. Dollars (U.S.
        $4,000,000) (the “Purchase
        Price”).
        The
        Shares represent ______ of the Company’s common stock par value $.001 per share
        (the “Common
        Stock”)
        on a
        fully-diluted basis.

       

      (b)
         Subject
        to the terms and conditions of this Agreement, the Investor agrees to purchase,
        and the Company agrees to sell and issue to the Investor, a warrant to purchase
        up to 6,400,000 shares of Common Stock in the form attached hereto as
Exhibit A
        (the
“Warrant”).
        The
        Warrant, upon exercise on the Effective Date, would represent, ____% of the
        Company’s Common Stock on a fully-diluted basis. The Shares and the Warrant are
        collectively referred to herein as the “Securities.”

       

      1.2 Closing.
        The
        purchase and sale of the Securities shall take place at the offices of Greenberg
        Traurig, P.A., 1221 Brickell Avenue, Miami, Florida, on the date hereof,
        at
        10:00 a.m., or at such other place and time as the Company, and the Investor
        mutually agree (which time and place are designated herein as the “Closing”).
        At
        the Closing, the parties shall deliver the following:

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      (a)
         the
        Investor shall pay the Purchase Price by interbank wire transfer of immediately
        available funds to such account of the Company as the Company shall designate
        prior to the Closing;

       

      (b)
         the
        Company shall deliver each of an original executed certificate representing
        the
        Shares and the Warrant to the Investor;

       

      (c)
         the
        Company shall have amended and restated the License and Distribution Agreement
        by and between the Company and the Investor, dated as of September 16, 2005
        (the “Amended
        License and Distribution Agreement”);

       

      (d)
         the
        Company shall have entered into the Registration Rights Agreement by and
        between
        the Company and the Investor, dated as of September 16, 2005 (the
“Registration
        Rights Agreement”);

       

      (e)
         the
        respective parties to this Agreement, the Amended and Restated License and
        Distribution Agreement and the Registration Rights Agreement (collectively,
        the
“Related
        Agreements”)
        shall
        have executed and delivered each such agreement;

       

      (f)
         the
        Company shall have reimbursed the Investor for fifty percent (50%) of the
        costs
        and fees associated with the Initial Investment; and

       

      (g)
         the
        Company shall have paid the Investor fifty percent (50%) of the costs and
        fees
        incurred as a result of this Agreement.

       

      1.3 Use
        of
        Proceeds.
        The
        proceeds from the sale of the Shares shall be used by the Company (i) in
        accordance with the agreed-upon budget of the Company, as approved by the
        Board
        of Directors of the Company, as amended from time to time by the Board of
        Directors (the “Budget”) and (ii) for the payment of fees and expenses incurred
        in connection with the consummation of the transactions contemplated by the
        Related Documents. In addition to such other limitations that are contained
        herein, the Company’s officers shall make no disbursement in an amount greater
        than $10,000 in one disbursement (or series of related disbursements with
        a sum
        greater than $20,000) and shall enter into no binding agreement obligating
        the
        Company to make payments in excess of $20,000 over the life of such agreement
        without the prior approval of the majority of the members of the Board of
        Directors, if such disbursement or binding agreement would be inconsistent
        with
        (or in light of the available facts and circumstances would likely be
        inconsistent with) the approved budgetary items set forth in the
        Budget.

       

      2. Representations
        and Warranties of the Company.
        The
        Company, hereby represents and warrants to the Investor as follows:

       

      2.1 Organization,
        Good Standing and Qualification.
        The
        Company is a corporation duly organized, validly existing and in good standing
        under the laws of the State of Delaware. The Company and each of its
        subsidiaries is duly qualified to transact business and is in good standing
        in
        each jurisdiction in which the nature of its business or its ownership of
        property requires it to be so qualified except for those jurisdictions in
        which
        the failure to be so qualified would not, individually or in the aggregate,
        have
        a material adverse effect on the Company’s business, assets, properties,
        prospects, operations or conditions (financial or otherwise) (a “Material
        Adverse Effect”).

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.2 Capitalization.
        The
        capitalization of the Company is as described in its public filings and as
        set
        forth on Exhibit B
        attached
        hereto.
        Except
        as set forth on Exhibit B,
        there
        is no option, warrant, call subscription, convertible security, right (including
        preemptive right) or contract of any character to which the Company is a
        party
        or by which it is bound obligating the Company to issue, exchange, transfer,
        sell, repurchase, redeem or otherwise acquire any capital stock of the Company
        or obligating the Company to grant, extend, accelerate the vesting of or
        enter
        into any such option, warrant, call, subscription, convertible security or
        right
        to contract. There are no outstanding or authorized stock appreciation, phantom
        stock or similar rights with respect to the Company.

       

      2.3 Subsidiaries;
        Joint Ventures.
        Except
        as set forth or par of Schedule 2.3,
        the
        Company does not own or control, directly or indirectly, any interest in
        any
        other corporation, association, or other entity (each, a “Subsidiary”).
        For
        each Subsidiary, Schedule
        2.3
        sets
        forth the equity interest owned by the Company and the percentage of the
        outstanding equity interest so owned. The Company is not a participant in
        any
        joint venture, partnership, or similar arrangement.

       

      2.4 Authorization.
        The
        Related Agreements constitute valid and legally binding obligations of the
        Company, enforceable in accordance with their respective terms, except
        (i) as limited by applicable bankruptcy, insolvency, reorganization,
        moratorium and other laws of general application affecting enforcement of
        creditors’ rights generally, and (ii) as limited by laws relating to the
        availability of specific performance, injunctive relief or other equitable
        remedies.

       

      2.5 Governmental
        Consents.
        No
        consent, approval, order or authorization of, or registration, qualification,
        designation, declaration or filing with, any federal, state or local
        governmental authority on the part of the Company is required in connection
        with
        the consummation of the transactions contemplated by this Agreement, except
        for
        such filings as are required pursuant to applicable federal and state securities
        laws and blue sky laws, which filings will be effected within the required
        statutory period.

       

      2.6 Offering.
        Subject
        in part to the truth and accuracy of the Investor’s representations set forth in
        Section 4
        of this
        Agreement, the offer, sale and issuance of the Securities as contemplated
        by
        this Agreement are exempt from the registration requirements of the Securities
        Act of 1933, as amended (the “Act”),
        and
        the qualification or registration requirements of applicable blue sky laws.
        Neither the Company nor any authorized agent acting on its behalf will take
        any
        action hereafter that would cause the loss of such exemptions.

       

      2.7 Litigation.
        There
        is no action, suit, proceeding or investigation pending, or to the Company’s
        knowledge, currently threatened against the Company that questions the validity
        of this Agreement or the right of the Company to enter into such agreement
        or to
        consummate the transactions contemplated hereby. The Company is not a party
        or
        subject to the provisions of any order, writ, injunction, judgment or decree
        of
        any court or government agency or instrumentality. There is no action, suit,
        proceeding or investigation by the Company currently pending or that the
        Company
        intends to initiate.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.8 Absence
        of Certain Developments.
        Since
        September 30, 2005, there has not been any Material Adverse Effect
        and:

       

      (a)
         neither
        the Company nor any Subsidiary has sold, leased, transferred or assigned
        any of
        its assets, tangible or intangible, other than for a fair consideration in
        the
        ordinary course of business;

       

      (b)
         neither
        the Company nor any Subsidiary has entered into any contract (or series of
        related contracts) either involving more than $10,000 or outside the ordinary
        course of business;

       

      (c)
         no
        party
        (including the Company or any Subsidiary) has accelerated, suspended, terminated
        modified or canceled any contract (or series of related contracts) involving
        more than $10,000 to which the Company or any Subsidiary is a party or by
        which
        any of them is bound;

       

      (d)
         no
        encumbrance has been imposed on any assets of the Company or any
        Subsidiary;

       

      (e)
         neither
        the Company nor any Subsidiary has made any capital expenditure (or series
        of
        related capital expenditures) either involving more than $10,000 or outside
        the
        ordinary course of business;

       

      (f)
         neither
        the Company nor any Subsidiary has made any capital investment in, any loan
        to,
        or any acquisition of the securities or assets of, any other person (or series
        of related capital investments, loans and acquisitions) or acquired (by merger,
        exchange, consolidation, acquisition of stock or assets or otherwise) any
        person;

       

      (g)
         neither
        the Company nor any Subsidiary has granted any license or sublicense of any
        rights under or with respect to any intellectual property;

       

      (h)
         there
        has
        been no change made or authorized in the organizational documents of the
        Company
        or any Subsidiary, except as set forth in the definitive proxy statement
        on
        Schedule 14A filed with the Securities and Exchange Commission on February
        8,
        2006, and approved by the shareholders at a special meeting on March 15,
        2006;
        and

       

      (i)
         neither
        the Company nor any Subsidiary has issued, sold or otherwise disposed of
        any of
        its capital stock or equity interests, or granted any options, warrants or
        other
        rights to purchase or obtain (including upon conversion, exchange or exercise)
        any of its capital stock, except as set forth on Exhibit
        B.

       

      2.9 Proprietary
        Information Agreements.
        Each
        current and former employee, officer and consultant of the Company has executed
        a proprietary information and inventions assignment agreement in forms adequate
        to protect the Company’s intellectual property, including, without limitation,
        any patents, patent rights, trademarks, trademark rights, service marks,
        service
        mark rights, trade names, trade name rights and copyrights (collectively,
        “Intellectual
        Property”),
        and
        Proprietary Information (as defined below). No former or current employee,
        officer or consultant of the Company has excluded works or inventions made
        prior
        to his or her employment with the Company from such employee’s, officer’s or
        consultant’s proprietary information and inventions assignment agreement, except
        for such works or inventions as set forth on Schedule 2.9. The Company does
        not
        believe it is or will be necessary to utilize any inventions, trade secrets
        or
        proprietary information of any of its employees made prior to their employment
        by the Company, except for inventions, trade secrets or proprietary information
        that have been assigned to the Company. The Company, after reasonable
        investigation, is not aware that any of its employees, officers or consultants
        are in violation of such agreements, and the Company will use its best efforts
        to prevent any such violation.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.10 Patents
        and Trademarks.
        The
        Company possesses all Intellectual Property necessary for its business without
        any conflict with or infringement of the valid rights of others, and the
        Company
        has not received any notice of infringement upon or conflict with the asserted
        rights of others. The Company has a valuable body of trade secrets, including
        know-how, concepts, computer programs and other technical data for the
        development, launch and operation of its business. The Company is not aware
        that
        any of its employees is obligated under any contract (including licenses,
        covenants or commitments of any nature) or other agreement, or subject to
        any
        judgment, decree or order of any court or administrative agency, that would
        interfere with the use of his or her best efforts to promote the interests
        of
        the Company or that would conflict with the Company’s business.

       

      2.11 Compliance
        with Other Instruments

       

      (a)
        . The
        Company is not in violation of any provision of its Certificate or its bylaws
        or, to its knowledge, of any instrument, judgment, order, writ, decree or
        contract, statute, rule or regulation to which the Company is subject. The
        execution, delivery and performance of this Agreement and the consummation
        of
        the transactions contemplated hereby will not result in any such violation,
        or
(i)
        be in
        conflict with or constitute, with or without the passage of time and giving
        of
        notice, either a default under any such provision or an event that results
        in
        the creation of any lien, charge or encumbrance upon any assets of the Company
        or the suspension, revocation, impairment, forfeiture or non-renewal of any
        material permit, license, authorization or approval applicable to the Company,
        its business or operations or any of its assets or properties, or (ii) require
        the consent or other action by any person under, constitute a default under,
        or
        give rise to termination, cancellation or acceleration of any right or
        obligation of the Company or to a loss of any benefit to which the Company
        is
        entitled under any provision of any agreement or other instrument binding
        upon
        the Company.

       

      2.12 Related-Party
        Transactions.
        Except
        as set forth on Schedule 2.12,
        no
        employee, officer or director of the Company or member of his or her immediate
        family is indebted to the Company, nor is the Company indebted (or committed
        to
        make loans or extend or guarantee credit) to any of them. None of such persons
        has any direct or indirect ownership interest in any firm or corporation
        with
        which the Company is affiliated or with which the Company has a business
        relationship, or any firm or corporation that competes with the Company,
        except
        that employees, officers or directors of the Company and members of their
        immediate families may own stock in publicly traded companies that may compete
        with the Company. No member of the immediate family of any officer or director
        of the Company is directly or indirectly interested in any material contract
        with the Company.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.13 Business
        Plan.
        Attached hereto as Schedule 2.13
        is a
        preliminary detailed budget for the Company’s 2006 and 2007 fiscal
        years.
        The
        business plan and of the Company for its 2006 and 2007 fiscal years will
        be
        provided to the Investor within sixty (60) days of the date
        hereof.

       

      2.14 Tax
        Returns.
        The
        Company has timely filed all tax returns (federal, state and local) required
        to
        be filed by it. The Company has not been advised that any of its returns
        have
        been or are being audited.

       

      2.15 Permits.
        The
        Company has all franchises, permits, licenses and any similar authority
        necessary for the operation of its business. The Company is not in default
        under
        any of such franchises, permits, licenses or other similar
        authority.

       

      2.16 Environmental
        and Safety Laws.
        To its
        knowledge, the Company is not in violation of any applicable statute, law
        or
        regulation relating to the environment or occupational health and safety,
        and to
        its knowledge, no material expenditures are or will be required in order
        to
        comply with any such existing statute, law or regulation.

       

      2.17 Registration
        Rights.
        Except
        as set forth in the Schedule
        2.17
        or the
        Related Agreements, the Company has not granted or agreed to grant any
        registration rights, including piggyback rights, to any person or
        entity.

       

      2.18 Corporate
        Documents; Minute Books.
        The
        Certificate and bylaws of the Company are in the form previously provided
        to the
        Investor. The minute books of the Company provided to the Investor contain
        a
        complete summary of all meetings of directors and stockholders since the
        time of
        incorporation and reflect all transactions referred to in such minutes
        accurately in all material respects.

       

      2.19 Title
        to
        Property and Assets.
        The
        property and assets the Company owns are owned by the Company free and clear
        of
        all mortgages, liens, loans and encumbrances, except (i)
        for
        statutory liens for the payment of current taxes that are not yet delinquent,
        and (ii) for
        liens, encumbrances and security interests that arise in the ordinary course
        of
        business, and minor defects in title, none of which, individually or in the
        aggregate, materially impair the Company’s ownership or use of such property or
        assets. With respect to the property and assets it leases, the Company is
        in
        material compliance with such leases and, to its knowledge, holds a valid
        leasehold interest free of any liens, claims or encumbrances, subject to
        clauses
        (i) and (ii).

       

      2.20 Insurance.
        The
        Company has insurance policies with such coverages in amounts (subject to
        reasonable deductibles) customary for similarly situated companies. Copies
        of
        such policies have been delivered to the Investor along with summary
        descriptions of the coverages thereunder.

       

      2.21 Labor
        Agreements and Actions.
        The
        Company is not aware that any officer or employee, or that any group of key
        employees, intends to terminate their employment with the Company, nor does
        the
        Company have a present intention to terminate the employment of any of the
        foregoing. Except as described on Schedule
        2.21,
        the
        Company is not a party to or bound by any currently effective employment
        contract, deferred compensation agreement, bonus plan, incentive plan, profit
        sharing plan, retirement agreement or other employee compensation agreement.
        The
        Company has complied in all material respects with all applicable state and
        federal equal employment opportunity and other laws related to employment.
        No
        executive officer of the Company (i) has been convicted in a criminal proceeding
        or is a named subject of a pending criminal proceeding (excluding minor traffic
        violations) or (ii) is or has been subject to any judgment or order of, or
        the
        subject of any pending civil or administrative action by, the Securities
        and
        Exchange Commission or any self-regulatory organization.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.22 Obligations
        of Management.
        Each
        executive officer and key employee of the Company is currently devoting
        substantially all of his or her business time to the conduct of the business
        of
        the Company. The Company is not aware that any executive officer or key employee
        of the Company is planning to work less than full time at the Company in
        the
        future. No executive officer or key employee is currently working or, to
        the
        Company’s knowledge, plans to work or consult for a competitive enterprise,
        whether or not such officer or key employee is or will be compensated by
        such
        enterprise.

       

      2.23 Disclosure.
        Neither
        this Agreement (including all the exhibits and schedules hereto) nor any
        other
        statements or certificates made or delivered in connection herewith contains
        any
        untrue statement of a material fact or omits to state a material fact necessary
        to make the statements herein or therein not misleading in light of the
        circumstances under which they were made. There is no fact known to the Company
        (other than facts known to the general public) that the Company has not
        disclosed to the Investor that has had or which could reasonably be expected
        to
        have a Material Adverse Effect. The information and financial projections
        relating to the Company delivered to the Investor (the “Investor
        Materials”),
        were
        made in good faith based upon reasonable assumptions, and the Company is
        not
        aware of any fact or set of circumstances that would lead it to believe that
        such information and assumptions were not reasonable. As of the date hereof
        and
        immediately prior to the Closing, no facts have come to the attention of
        the
        Company that would, in its opinion, require the Company to revise in any
        material respect the Investor Materials or the assumptions underlying the
        projections or any other information contained therein.

       

      2.24 No
        Brokerage. No
        Person
        will be entitled to receive any brokerage commission, finder’s fee, fee for
        financial advisory services or similar compensation in connection with the
        transaction contemplated by this Agreement.

       

      3. Representations
        and Warranties of the Investor.
        The
        Investor hereby represents, warrants and covenants that:

       

      3.1 Authorization.
        The
        Investor has full power and authority to enter into the Related Agreements
        to
        which it is a party, and each such agreement when executed will constitute
        a
        valid and legally binding obligation of the Investor, enforceable in accordance
        with its terms.

       

      3.2 Purchase
        Entirely for Own Account.
        The
        Securities to be received by the Investor will be acquired for investment
        for
        the Investor’s own account, not as a nominee or agent, and not with a view to
        the resale or distribution of any part thereof, and the Investor has no present
        intention of selling, granting any participation in or otherwise distributing
        the same, except that the Investor may transfer, including, without limitation,
        to the Investor’s employees, officers and directors, in accordance with the
        Related Agreements and applicable law. The Investor further represents that
        it
        does not have any contract, undertaking, agreement or arrangement with any
        person to sell, transfer or grant participations to such person or to any
        third
        person, with respect to any of the Restricted Securities.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      3.3 Accredited
        Investor.
        The
        Investor is an “accredited investor” within the meaning of Securities and
        Exchange Commission (“SEC”)
        Rule
        501 of Regulation D, as presently in effect.

       

      3.4 Restricted
        Securities.
        The
        Investor understands that the Securities are characterized as “restricted
        securities” under federal securities laws inasmuch as the Securities being
        acquired from the Company in a transaction not involving a public offering
        and
        that under such laws and applicable regulations the Restricted Securities
        may be
        resold without registration under the Act only in certain limited
        circumstances.

       

      3.5 Legends.
        It is
        understood that each of the certificates evidencing the Securities may bear
        one
        or all of the following legends:

       

      (a)
         “These
        securities have not been registered under the Securities Act of 1933, as
        amended. They may not be sold, offered for sale, pledged or hypothecated
        in the
        absence of a registration statement in effect with respect to the securities
        under such Act or an opinion of counsel satisfactory to the Company that
        such
        registration is not required or unless sold pursuant to Rule 144 of such
        Act.”

       

      (b)
         Any
        other
        legends required to properly reflect the restrictions contained in the Related
        Agreements.

       

      4. Conditions
        of Investor’s Obligations at Closing.
        The
        obligations of the Investor under this Agreement are subject to the fulfillment
        on or before the Closing of each of the following conditions:

       

      4.1 Representations
        and Warranties.
        The
        representations and warranties of the Company contained in Section 2
        shall be
        true on and as of the Closing.

       

      4.2 Performance.
        The
        Company shall have performed and complied with all agreements, obligations
        and
        conditions contained in this Agreement that are required to be performed
        or
        complied with by them on or before the Closing.

       

      4.3 Proceedings
        and Documents.
        All
        corporate and other proceedings in connection with the transactions contemplated
        at the Closing, and all documents incident thereto shall be reasonably
        satisfactory in form and substance to the Investor, and it shall have received
        all such counterpart original and certified or other copies of such documents
        as
        they may reasonably request.

       

      4.4 Fees
        of
        Counsel.
        The
        Company shall have paid the fifty percent (50%) fees, expenses and disbursements
        of counsel to the Investor invoiced at the Closing.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      4.5 Warrant
        Agreement.
        The
        Company shall have entered into the Warrant in the form attached hereto as
        Exhibit A.

       

      4.6 Share
        Certificate.
        The
        Company shall have notified its transfer agent to prepare and deliver, and
        such
        transfer agent shall deliver, an originally executed share certificate
        evidencing the Shares subscribed for hereby.

       

      4.7 Registration
        Rights Agreement.
        The
        Company shall have entered into the Registration Rights Agreement in the
        form
        attached hereto as Exhibit C.

       

      4.8 Amended
        and Restated License and Distribution Agreement

       

       The
        Company and the Investor shall have entered into the Amended and Restated
        License and Distribution Agreement
        in the
        form attached hereto as Exhibit
        D.

       

      5. Conditions
        of the Company’s Obligations at Closing.
        The
        obligations of the Company to the Investor under this Agreement are subject
        to
        the fulfillment on or before the Closing of each of the following conditions
        by
        the Investor:

       

      5.1 Representations
        and Warranties.
        The
        representations and warranties of the Investor contained in
        Section 3
        shall be
        true on and as of the Closing.

       

      5.2 Payment
        of Purchase Price.
        The
        Investor shall have delivered the Purchase Price as specified in
        Section 1.2
        and
Schedule
        I
        (minus
        the amounts payable by the Company pursuant to Section 4.4).

       

      6. Miscellaneous.

       

      6.1 Indemnification

       

      (a)
         Subject
        to Section 6.4
        below,
        the Company agrees to indemnify, defend and hold harmless the Investor and
        the
        Investor’s members, directors, managers, officers, employees, agents and
        affiliates (collectively, “Investor
        Indemnitees”)
        from
        and against any and all losses, claims, damages, liabilities and expenses,
        including, without limitation, reasonable attorneys’ fees and disbursements and
        other expenses incurred in connection with investigating, preparing, settling
        or
        defending any action, claim or proceeding, pending or threatened and the
        costs
        of enforcement hereof (collectively, “Losses”),
        that
        such Investor Indemnitee may suffer or become subject to (i)
        as a
        result of any breach of representation, warranty, covenant or agreement made
        by
        or to be performed on the part of the Company under this Agreement or any
        other
        Related Agreement, or (ii)
        that
        otherwise arise from any action, claim or proceeding (whether related to
        the
        Company or otherwise) arising out of the matters or transactions contemplated
        by
        this Agreement or any other Related Agreement, and in each case to reimburse
        such Investor Indemnitee for all such amounts as they are incurred by the
        Investor. The existence of any breach of any representation, warranty, covenant
        or agreement and the amount of Losses incurred or suffered arising out of
        such
        breach shall be determined without regard to any qualification or exception
        relating to materiality.

       

      (b)
         Promptly
        after receipt by any Investor Indemnitee of notice of any demand, claim or
        circumstance that would or might give rise to a claim or the commencement
        of any
        suit, action, proceeding or investigation in respect of which indemnity may
        be
        sought pursuant to Section 6.1(a),
        such
        Investor Indemnitee shall give notice thereof to the Company. Notwithstanding
        the foregoing, the failure to give prompt notice to the Company will not
        relieve
        the Company from liability, except to the extent such failure or delay
        materially prejudices the Company. The Company may, at the request of the
        Investor Indemnitee, participate in and control the defense of any such suit,
        action or proceeding at its own expense. It is understood that in any such
        suit,
        action or proceeding, the Investor Indemnitee has the right to retain its
        own
        counsel but that the Company shall not be liable for the fees and expenses
        of
        more than one separate law firm (in addition to any local counsel) for all
        Investor Indemnitees; provided,
        that any
        Investor Indemnitee seeking indemnification under Section 6.1(a)(ii)
        may
        assume the defense of any such suit, action or proceeding thereunder if the
        Investor Indemnitee reasonably determines that the Company is not adequately
        representing or, because of a potential or actual conflict of interest, may
        not
        adequately represent, the interests of the Investor Indemnitee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      6.2 SEC
        Filings.
        The
        Investor shall be responsible for the preparation and filing of a Form 3
        and a
        Schedule 13D within the applicable time periods following the Closing, pursuant
        to the regulations promulgated by the Securities and Exchange
        Commission.

       

      6.3 Pre-emptive
        Rights.
        The
        Investor shall have the right, but not the obligation, on an as-converted
        basis,
        to participate in all future offerings of shares of capital stock or other
        securities of the Company on the same terms and conditions of the particular
        offer being considered by the Company, to the extent necessary to maintain
        its
        percentage ownership of the Company’s outstanding capital stock (on a
        fully-diluted basis).

       

      6.4 Survival.
        The
        warranties, representations and covenants contained in or made pursuant to
        this
        Agreement shall survive the execution and delivery of this Agreement and
        the
        Closing for a period of twenty-four (24) months following the Closing;
provided,
        however,
        that any
        warranty, representation or covenant relating to tax or environmental matters
        shall survive until the expiration of the statute of limitations for such
        matters under applicable law. The warranties, representations and covenants
        contained in or made pursuant to this Agreement shall in no way be affected
        by
        any investigation of the subject matter thereof made by or on behalf of the
        Investor, the Company or the Founders.

       

      6.5 Successors
        and Assigns.
        Except
        as otherwise provided herein, the terms and conditions of this Agreement
        shall
        inure to the benefit of and be binding upon the respective successors and
        assigns of the parties (including transferees of any Investor membership
        interests). Nothing in this Agreement, express or implied, is intended to
        confer
        upon any party, other than the parties hereto or their respective successors
        and
        assigns, any rights, remedies, obligations or liabilities under or by reason
        of
        this Agreement, except as expressly provided in this Agreement.

       

      6.6 Governing
        Law.
        This
        Agreement shall be governed by and construed under the laws of the State
        of
        Delaware, without regard to the conflicts of laws rules of such
        state.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      6.7 Arbitration

       

      (a)
         Any
        dispute, controversy or claim arising out of, relating to or in connection
        with
        this Agreement or any Related Agreement, including any question regarding
        its
        existence, validity or termination, or regarding a breach thereof (hereafter,
        “dispute”)
        shall
        be submitted to a representative of each of the parties involved to attempt
        to
        reach an amicable resolution. A party wishing to initiate consideration of
        a
        dispute by such representative shall give written notice to the other parties
        hereto of the existence of such dispute and of the party’s desire to have such
        representative consider the dispute. Such notice shall set forth a brief
        description of the nature of the dispute to be considered.

       

      (b)
         If
        a
        dispute is not settled within fifteen (15) days after the notice is given
        to the
        other parties seeking representative consideration of a dispute, such dispute
        shall be submitted to arbitration administered by the American Arbitration
        Association in accordance with its Commercial Arbitration Rules, in effect
        on
        the date of this Agreement (the “Rules”).
        A
        party wishing to submit a dispute to arbitration shall give written notice
        to
        such effect to the other parties hereto. The arbitration shall be before
        a sole
        arbitrator appointed in accordance with the Rules and this
        Agreement.

       

      (c)
         The
        site
        of the arbitration shall be Miami, Florida, or such other location as the
        parties may mutually agree in writing, and any award shall be deemed to have
        been made there. The decision of the arbitrator shall be rendered within
        180
        days from its appointment, and shall be final and binding upon all parties.
        The
        award may be made public only with the written consent of all parties to
        the
        arbitration, provided,
        however,
        that
        any
        ruling or award, final or otherwise, may be cited in any subsequent dispute
        or
        proceeding to enforce such ruling. The arbitrator shall neither have nor
        exercise any power to award special, exemplary, indirect, consequential or
        punitive damages.

       

      (d)
         It
        is the
        intent of the parties that the arbitration proceeding shall be conducted
        expeditiously, without initial recourse to the courts and without interlocutory
        appeals of the award to the courts. However, if a disputing party refuses
        to
        honor its obligations under this Agreement to arbitrate, any other disputing
        party may obtain appropriate relief compelling arbitration in any court having
        jurisdiction over the disputing parties; the order compelling arbitration
        shall
        require that the arbitration proceedings take place in Miami, Florida as
        specified above. The disputing parties may apply to any court having
        jurisdiction for orders requiring witnesses to obey subpoenas issued by the
        arbitrator. Moreover, the arbitrator’s orders and decisions may be enforced if
        necessary by any court having jurisdiction. The award may be confirmed in,
        and
        judgment upon the award entered by, any court having jurisdiction.

       

      6.8 Titles
        and Subtitles.
        The
        titles and subtitles used in this Agreement are used for convenience only
        and
        are not to be considered in construing or interpreting this
        Agreement.

       

      6.9 Notices.
        All
        notices required or permitted hereunder shall be in writing and shall be
        deemed
        effectively given: (i) upon
        personal delivery to the party to be notified, (ii)
        when
        sent by confirmed facsimile if sent during the normal business hours of the
        recipient (if not sent during the normal business hours of the recipient,
        then
        on the next business day); (iii)
        three
        (3) days after having been sent by registered or certified mail, return receipt
        requested, postage prepaid; or (iv) one
        (1) day after deposit with a nationally recognized overnight courier, specifying
        next day delivery, with written verification of receipt. All communications
        shall be sent to the address as set forth on the signature page hereof or
        at
        such other address as such party may designate by ten days advance written
        notice to the other parties hereto.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      6.10 No
        Brokers.
        Each
        party represents that it neither is nor will be obligated for any finders’ fee
        or commission in connection with this transaction. The Company agrees to
        indemnify and hold harmless the Investor from any liability for any commission
        or compensation in the nature of a finders’ fee (and the costs and expenses of
        defending against such liability or asserted liability) for which the Company
        or
        any of its officers, employees or representatives (including any Founder)
        is
        responsible.

       

      6.11 Expenses.
        The
        Company shall pay all of its costs and expenses incurred with respect to
        the
        negotiation, execution, delivery and performance of the Related Agreements
        and
        one-half of the Investor’s costs and expenses incurred with respect to the
        negotiation, execution, delivery and performance of the Related Agreement
        (including any costs and expenses of the Investor to be paid by the Company
        in
        connection with any previous transaction). If any action at law or in equity
        is
        necessary to enforce or interpret the terms of the Related Agreements or
        the
        Certificate, the prevailing party shall be entitled to reasonable attorney’s
        fees, costs and necessary disbursements in addition to any other relief to
        which
        such party may be entitled.

       

      6.12 Amendments
        and Waivers.
        Any
        term of this Agreement may be amended and the observance of any term of this
        Agreement may be waived (either generally or in a particular instance and
        either
        retroactively or prospectively), only with the written consent of the Company,
        each Founder and the Investor. Any amendment or waiver effected in accordance
        with this paragraph shall be binding upon the Investor, each transferee of
        the
        Investor Limited Partnership Interests, each Founder and the
        Company.

       

      6.13 Severability.
        If one
        or more provisions of this Agreement are held to be unenforceable under
        applicable law, such provision shall be excluded from this Agreement and
        the
        balance of the Agreement shall be interpreted as if such provision were so
        excluded and shall be enforceable in accordance with its terms.

       

      6.14 Entire
        Agreement.
        The
        Related Agreements constitute the entire agreement among the parties and
        no
        party shall be liable or bound to any other party in any manner by any
        warranties, representations or covenants except as specifically set forth
        herein
        or therein.

       

      6.15 Further
        Assurances.
        Each
        party shall perform such other acts and execute and deliver such other documents
        as may be necessary or appropriate to give effect to the purposes and intent
        of
        this Agreement.

       

      6.16 Counterparts.
        This
        Agreement may be executed in two or more counterparts and the signatures
        delivered by telecopy, each of which shall be deemed an original, with the
        same
        effect as if the signatures were upon the same instrument and delivered in
        person.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      6.17 Construction.
        This
        Agreement was negotiated by the parties with the benefit of legal
        representation, and any rule of construction or interpretation otherwise
        requiring this Agreement to be construed or interpreted against any party
        shall
        not apply to any construction or interpretation hereof.

       

      REMAINDER
        OF PAGE LEFT INTENTIONALLY BLANK

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF,
        the
        parties hereto have executed this Subscription Agreement as of the day and
        year
        hereinabove first written.

       

      
        	 	 	 
	 	
                COMPANY:

              
	 	 
	 	
                ELECTRIC
                  AQUAGENICS UNLIMITED INC.

              
	 
 	 
 	 
 
	 	By:  	/s/ Gaylord
                M. Karren
	 	
                
Name:
                Gaylord M. Karren
	 	
                Title:
                  Chief Executive Officer

              

      

      
        	 	 	 
	 	 	 
	 	 	
                Address
                  for notices:

                1464
                  West 40 South

                Lindon,
                  UT 84042

                Attention:
                  Gaylord Karren

                Facsimile:
                  (801) 443-1029

              
	
                 

              	
                 

              
	 	 
	 	
                INVESTOR:

              
	 	 
	 	
                WATER
                  SCIENCE, LLC

              
	 
 	 
 	 
 
	 	By:  	/s/ Peter
                Ullrich
	 	
                
Name:
                Peter Ullrich
	 	
                Title:
                  Sole Member

              
	 	 
	 	 
	 	
                
                  Address
                    for notices:

                  Water
                    Science, LLC

                  1800
                    N.W. 89th Place

                  Miami,
                    FL 33172

                  Attention:
                    Peter Ullrich

                  Email:
                    peteru@esmaraldainc.com

                

              

      

       

      Subscription
        Agreement Signature PageTHIS
      SECURITY HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF 1933
      (THE “ACT”) OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED OR SOLD
      UNLESS REGISTERED AND QUALIFIED PURSUANT TO THE APPLICABLE PROVISIONS OF FEDERAL
      AND STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION OR
      QUALIFICATION APPLIES. THEREFORE, NO SALE OR TRANSFER OF THIS SECURITY SHALL
      BE
      MADE, NO ATTEMPTED SALE OR TRANSFER SHALL BE VALID, AND THE ISSUER SHALL NOT
      BE
      REQUIRED TO GIVE ANY EFFECT TO ANY SUCH TRANSACTION UNLESS (A) SUCH TRANSACTION
      HAS BEEN DULY REGISTERED UNDER THE ACT AND QUALIFIED OR APPROVED UNDER
      APPROPRIATE STATE SECURITIES LAWS, OR (B) THE ISSUER HAS FIRST
      RECEIVED

     

    AN
      OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH REGISTRATION,
      QUALIFICATION OR APPROVAL IS NOT REQUIRED.

    

    WARRANT

    

    For
      the
      Purchase of Shares of Common Stock of

    

    ELECTRIC
      AQUAGENICS UNLIMITED, INC.

    

    Void
      After 5 P.M. May 1, 2009

     

    
      	No. ___	 	Date: 
              May 1, 2006
	 	 	Lindon, Utah

    

    

    Warrant
      to Purchase Six Million Four Hundred Thousand Shares of Common
      Stock

    

    THIS
      IS TO CERTIFY,
      that,
      for value received, Water Science, LLC, a Florida limited liability company
      or
      registered assigns (the “Holder”), is entitled, subject to the terms and
      conditions hereinafter set forth, on or after the date hereof, and at any time
      prior to 5 P.M., Mountain Daylight Time (“MDT”), on May 1, 2009 but not
      thereafter, to purchase such number of shares of Common Stock, par value $0.000l
      (“Common Stock” or the “Shares”), of Electric Aquagenics Unlimited, Inc. (the
“Company”), from the Company as set forth above and upon payment to the Company
      of an amount per Share of $2.76 (the “Purchase Price”), or conversion pursuant
      to Section 1.3 hereof, if and to the extent this Warrant is exercised, in whole
      or in part, during the period this Warrant remains in force, subject in all
      cases to adjustment as provided in Section 2 hereof, and to receive a
      certificate or certificates representing the Shares so purchased, upon
      presentation and surrender to the Company of this Warrant, with the form of
      Subscription Agreement attached hereto, including changes thereto reasonably
      requested by the Company, duly executed and accompanied by payment of the
      Purchase Price of each Share.

    

    SECTION
      1  

     

    Terms
      of this Warrant

    

    1.1  Time
      of Exercise.
      This
      Warrant may be exercised at any time and from time to time after 9:00 A.M.
      Mountain Time, as the case may be, on the date hereof (the “Exercise
      Commencement Date”), but no later than 5:00 P.M., MDT, on May 1, 2009 (the
“Expiration Time”) at which time this Warrant shall become void and all rights
      hereunder shall cease.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    1.2  Manner
      of Exercise.

     

    1.2.1  The
      Holder may exercise this Warrant, in whole or in part, upon surrender of this
      Warrant, with the form of Subscription Agreement attached hereto duly executed,
      to the Company at its corporate office in Lindon, Utah, and upon payment to
      the
      Company of the full Purchase Price for each Share to be purchased in lawful
      money of the United States, or by certified or cashier’s check, or wired funds,
      and upon compliance with and subject to the conditions set forth
      herein.

     

    1.2.2  Upon
      receipt of this Warrant with the form of Subscription Agreement duly executed
      and accompanied by payment of the aggregate Purchase Price for the Shares for
      which this Warrant is then being exercised, the Company shall cause to be issued
      certificates for the total number of whole Shares for which this Warrant is
      being exercised in such denominations as are required for delivery to the
      Holder, and the Company shall thereupon deliver such certificates to the Holder
      or its nominee.

     

    1.2.3  In
      case
      the Holder shall exercise this Warrant with respect to less than all of the
      Shares that may be purchased under this Warrant, the Company shall execute
      a new
      Warrant for the balance of the Shares that may be purchased upon exercise of
      this Warrant and deliver such new Warrant to the Holder.

     

    1.2.4  The
      Company covenants and agrees that it will pay when due and payable any and
      all
      taxes which may be payable in respect of the issue of this Warrant, or the
      issue
      of any Shares upon the exercise of this Warrant (other than income tax or
      capital gains tax of the Holder in connection with the exercise of the Warrant).
      The Company shall not, however, be required to pay any tax which may be payable
      in respect of any transfer involved in the issuance or delivery of this Warrant
      or of the Shares in a name other than that of the Holder at the time of
      surrender, and until the payment of such tax the Company shall not be required
      to issue such Shares.

     

    1.3  Conversion
      Right.
      In lieu
      of exercising this Warrant as specified in Section 1.2, Holder may from time
      to
      time convert a portion of this Warrant that represents up to an aggregate of
      500,000 Shares, into a number of Shares determined by dividing (a) the aggregate
      fair market value of the Shares or other securities otherwise issuable upon
      exercise of this conversion right minus the aggregate Purchase Price of such
      Shares by (b) the fair market value of one Share. The fair market value of
      the
      Shares shall be determined pursuant to Section 1.4.

     

    1.4  Fair
      Market Value.
      If the
      Shares are traded in a public market, the fair market value of the Shares shall
      be the average closing price of the Shares (or the closing price of the
      Company’s stock into which the Shares are convertible) reported for the ten (10)
      business days immediately before Holder delivers its Notice of Exercise to
      the
      Company. If the Shares are not traded in a public market, the Board of Directors
      of the Company shall determine fair market value in its reasonable good faith
      judgment. The foregoing notwithstanding, if Holder advises the Board of
      Directors in writing that Holder disagrees with such determination, then the
      Company and Holder shall promptly agree upon a reputable investment banking
      firm
      to undertake such valuation. If the valuation of such investment banking firm
      is
      greater than that determined by the Board of Directors, then all fees and
      expenses of such investment banking firm shall be paid by the Company. In all
      other circumstances, such fees and expenses shall be paid by
      Holder.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

       

    

    1.5  Exchange
      of Warrant.
      This
      Warrant may be divided into, combined with or exchanged for another Warrant
      or
      Warrants of like tenor to purchase a like aggregate number of Shares. If the
      Holder desires to divide, combine or exchange this Warrant, he shall make such
      request in writing delivered to the Company at its corporate office and shall
      surrender this Warrant and any other Warrants to be so divided, combined or
      exchanged. The Company shall execute and deliver to the person entitled thereto
      a Warrant or Warrants, as the case may be, as so requested. The Company shall
      not be required to effect any division, combination or exchange which will
      result in the issuance of a Warrant entitling the Holder to purchase upon
      exercise a fraction of a Share. The Company may require the Holder to pay a
      sum
      sufficient to cover any tax or governmental charge that may be imposed in
      connection with any division, combination or exchange of Warrants.

     

    1.6  Holder
      as Owner.
      Prior
      to surrender of this Warrant in accordance with Section for registration of
      assignment, the Company may deem and treat the Holder as the absolute owner
      of
      this Warrant (notwithstanding any notation of ownership or other writing hereon)
      for the purpose of any exercise hereof and for all other purposes, and the
      Company shall not be affected by any notice to the contrary.

     

    1.7  Method
      of Assignment.
      Any
      assignment or transfer of any portion or all of this Warrant shall be made
      by
      surrender of this Warrant to the Company at its principal office with the form
      of assignment attached hereto duly executed and accompanied by funds sufficient
      to pay any transfer tax. In such event, the Company shall, without charge,
      execute and deliver a new Warrant in the name of the assignee named in such
      instrument of assignment and this Warrant shall promptly be
      canceled.

     

    1.8  Rights
      of Holder.
      Nothing
      contained in this Warrant shall be construed as conferring upon the Holder
      the
      right to vote, consent or receive notice as a shareholder in respect of any
      meetings of shareholders for the election of directors or any other matter,
      or
      as having any rights whatsoever as a shareholder of the Company.

     

    1.9  Lost
      or Damaged Warrant.
      If this
      Warrant is lost, stolen, mutilated or destroyed, the Company shall, on such
      reasonable terms as to indemnity or otherwise as it may impose (which shall,
      in
      the case of a mutilated Warrant, include the surrender thereof), issue a new
      Warrant of like denomination and tenor as, and in substitution for, this
      Warrant, which shall thereupon become void. Any such new Warrant shall
      constitute an additional contractual obligation of the Company, whether or
      not
      the Warrant so lost, stolen, destroyed or mutilated shall be at any time
      enforceable by anyone.

     

    1.9.1  At
      all
      times the Company shall reserve and keep available for the exercise of this
      Warrant such number of authorized shares of Common Stock as are sufficient
      to
      permit the exercise in full of this Warrant.

     

    1.9.2  The
      Company covenants that all Shares when issued upon the exercise of this Warrant
      will be validly issued, fully paid, nonassessable and free of preemptive
      rights.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

       

    

    SECTION
      2  

     

    Adjustment
      of Purchase Price and Number of Shares Purchasable upon
      Exercise

    

    2.1  Stock
      Splits.
      If the
      Company at any time or from time to time after the issuance date of this Warrant
      effects a subdivision of the outstanding Common Stock, the Purchase Price then
      in effect immediately before that subdivision shall be proportionately
      decreased, and conversely, if the Company at any time or from time to time
      after
      the issuance date of this Warrant combines the outstanding shares of Common
      Stock, the Purchase Price then in effect immediately before the combination
      shall be proportionately increased. Any adjustment under this subsection 2.1
      shall become effective at the close of business on the date the subdivision
      or
      combination becomes effective.

     

    2.2  Dividends
      and Distributions.
      In the
      event the Company at any time, or from time to time after the issuance date
      of
      this Warrant makes, or fixes a record date for the determination of holders
      of
      Common Stock entitled to receive, a dividend or other distribution payable
      in
      additional shares of Common Stock, then and in each such event the Purchase
      Price then in effect shall be decreased as of the time of such issuance or,
      in
      the event such a record date is fixed, as of the close of business on such
      record date, by multiplying the Purchase Price then in effect by a fraction
      (i)
      the numerator of which is the total number of shares of Common Stock issued
      and
      outstanding immediately prior to the time of such issuance or the close of
      business on such record date, and (ii) the denominator of which shall be the
      total number of shares of Common Stock issued and outstanding immediately prior
      to the time of such issuance or the close of business on such record date plus
      the number of shares of Common Stock issuable in payment of such dividend or
      distribution; provided, however, that if such record date is fixed and such
      dividend is not fully paid or if such distribution is not fully made on the
      date
      fixed therefor, the Purchase Price shall be recomputed accordingly as of the
      close of business on such record date and thereafter the Purchase Price shall
      be
      adjusted pursuant to this subsection 2.2 as of the time of actual payment of
      such dividends or distributions.

     

    2.3  Recapitalization
      or Reclassification.
      If the
      Shares issuable upon the exercise of the Warrant are changed into the same
      or a
      different number of shares of any class or classes of stock, whether by
      recapitalization, reclassification or otherwise (other than a subdivision or
      combination of shares or stock dividend or a reorganization, merger,
      consolidation or sale of assets, provided for elsewhere in this Section 2),
      then, and in any such event, the Holder shall thereafter be entitled to receive
      upon exercise of this Warrant such number and kind of stock or other securities
      or property of the Company to which a holder of Shares deliverable upon exercise
      of this Warrant would have been entitled on such reclassification or other
      change, subject to further adjustment as provided herein.

     

    2.4  Subsequent
      Equity Sales.
      If the
      Company or any Subsidiary thereof, as applicable, at any time while this Warrant
      is outstanding, shall offer, sell, grant any option to purchase or offer, sell
      or grant any right to re-price its securities, or otherwise dispose of or issue
      (or announce any offer, sale, grant or any option to purchase or other
      disposition) any Common Stock or any securities convertible into or exchangeable
      for shares of Common Stock, or the issuance of any warrants, options,
      subscription or purchase rights with respect to such convertible or exchangeable
      securities (“Common Stock Equivalents”) entitling any Person to acquire shares
      of Common Stock, at an effective price per share less than the then Purchase
      Price (such lower price, the “Base Purchase Price” and such issuances
      collectively, a “Dilutive Issuance”), as adjusted hereunder (if the holder of
      the Common Stock or Common Stock Equivalents so issued shall at any time,
      whether by operation of purchase price adjustments, reset provisions, floating
      conversion, exercise or exchange prices or otherwise, or due to warrants,
      options or rights per share which is issued in connection with such issuance,
      be
      entitled to receive shares of Common Stock at an effective price per share
      which
      is less than the Purchase Price, such issuance shall be deemed to have occurred
      for less than the Purchase Price on such date of the Dilutive Issuance), then
      the Purchase Price shall be reduced to equal the Base Purchase Price.
      Notwithstanding the foregoing, the issuance of shares pursuant to existing
      employee stock option plans or programs that have been disclosed to Investor,
      the issuance of shares pursuant to the Company’s existing compensation plan for
      non-employee directors, or the issuance of shares or the grant of options,
      warrants or other derivative securities pursuant to future employee stock option
      plans or programs that are approved by the board of directors and the
      shareholders of the Company, shall not be deemed to be Dilutive Issuances for
      purposes of this Section 2.4. The Company shall notify the Holder in writing,
      no
      later than the Business Day following the issuance of any Common Stock or Common
      Stock Equivalents subject to this section, indicating therein the applicable
      issuance price, or of applicable reset price, exchange price, conversion price
      and other pricing terms (such notice the “Dilutive Issuance Notice”). For
      purposes of clarification, whether or not the Company provides a Dilutive
      Issuance Notice pursuant to this Section 2.4, upon the occurrence of any
      Dilutive Issuance the Purchase Price shall be reduced to equal the Base Purchase
      Price. 

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

       

    

    2.5  Subsequent
      Rights Offerings. If the Company, at any time while the Warrant is outstanding,
      shall issue rights, options or warrants to all holders of Common Stock (and
      not
      to the Holder) entitling them to subscribe for or purchase shares of Common
      Stock at a price per share less than the Purchase Price at the record date
      mentioned below, then the Purchase Price shall be multiplied by a fraction,
      of
      which the denominator shall be the number of shares of the Common Stock
      outstanding on the date of issuance of such rights or warrants plus the number
      of additional shares of Common Stock offered for subscription or purchase,
      and
      of which the numerator shall be the number of shares of the Common Stock
      outstanding on the date of issuance of such rights or warrants plus the number
      of shares which the aggregate offering price of the total number of shares
      so
      offered (assuming receipt by the Company in full of all consideration payable
      upon exercise of such rights, options or warrants) would purchase at such lesser
      price. Such adjustment shall be made whenever such rights or warrants are
      issued, and shall become effective immediately after the record date for the
      determination of stockholders entitled to receive such rights, options or
      warrant.

     

    2.6  No
      adjustment in the Purchase Price shall be required unless such adjustment would
      require an increase or decrease of at least 1% in such price; provided, however,
      that any adjustments which by reason of this Section 2.6 are not required to
      be
      made shall be carried forward and taken into account in any subsequent
      adjustment; and provided, further, that any adjustment required in order to
      preserve the tax-free nature of a distribution to the holders of shares of
      Common Stock shall be made when so required.  All
      calculations under this Section 2 shall be made to the nearest cent (with $.005
      being rounded upward). Anything in this Section 2 to the contrary
      notwithstanding, the Company shall be entitled, to the extent permitted by
      law,
      to make such reductions in the Purchase Price, in addition to those required
      by
      this Section 2, as it in its discretion shall determine to be advisable in
      order
      that any stock dividends, subdivision or combination of shares, distribution
      of
      capital stock or rights or warrants to purchase stock or securities,
      distribution of evidences of indebtedness or assets or any other transaction
      which could be treated as any of the foregoing transactions pursuant to Section
      305 of the Internal Revenue Code of 1986, as amended (and any successor
      provision), hereafter made by the Company to its shareholders shall not be
      taxable to such shareholders.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

       

    

    SECTION
      3  

     

    Status
      Under the Securities Act of 1933

    

    This
      Warrant and the Shares issuable upon exercise of this Warrant have not been
      registered under the Securities Act of 1933, as amended (“the Act”). Upon
      exercise, in whole or in part, of this Warrant, the certificates representing
      the Shares shall bear the legend first above written.

    

    SECTION
      4  

     

    Other
      Matters

    

    4.1  Binding
      Effect.
      All the
      covenants and provisions of this Warrant by or for the benefit of the Company
      shall bind and inure to the benefit of its successors and assigns
      hereunder.

     

    4.2  Notices.
      Notices
      or demands pursuant to this Warrant to be given or made by the Holder to or
      on
      the Company shall be sufficiently given or made if sent by certified or
      registered mail, return receipt requested, postage prepaid, or facsimile and
      addressed, until another address is designated in writing by the Company, as
      follows:

     

    Electric
      Aquagenics Unlimited, Inc.

    1464
      W.
      40 South, Suite 200

    Lindon,
      Utah 84042

    Telephone
      No.: (801) 443-1031

    Attention: Gaylord
      Karren, Chief Executive Officer

    

    Notices
      to the Holder provided for in this Warrant shall be deemed given or made by
      the
      Company if sent by certified or registered mail, return receipt requested,
      postage prepaid, and addressed to the Holder at his last known address as it
      shall appear on the books of the Company.

    

    4.3  Governing
      Law.
      The
      validity, interpretation and performance of this Warrant shall be governed
      by
      the laws of the State of Delaware. 

     

    4.4  Parties
      Bound and Benefited.
      Nothing
      in this Warrant expressed and nothing that may be implied from any of the
      provisions hereof is intended, or shall be construed, to confer upon, or give
      to, any person or corporation other than the Company and the Holder any right,
      remedy or claim under any promise or agreement hereof, and all covenants,
      conditions, stipulations, promises and agreements contained in this Warrant
      shall be for the sole and exclusive benefit of the Company and its successors
      and of the Holder, its successors and permitted assigns.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

       

    

    4.5  Headings.
      The
      Section headings herein are for convenience only and are not part of this
      Warrant and shall not affect the interpretation thereof.

     

    (Remainder
      Of Page Intentionally Left Blank)

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    IN,
      WITNESS WHEREOF,
      this
      Warrant has been duly executed by the Company as of May
      1_____,
      2006.

     

    
      	 	 	 
	 	ELECTRIC
              AQUAGENICS UNLIMITED, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Gaylord
              Karren
	 	
              
Gaylord
              Karren, Chief Executive Officer
	 	 

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    ASSIGNMENT
      OF WARRANT

    

    

    FOR
      VALUE RECEIVED,
      ___________________________ hereby sells, assigns and transfers unto
      ________________________ the within Warrant and the rights represented thereby,
      and does hereby irrevocably constitute and appoint _______________________
      Attorney, to transfer said Warrant on the books of the Company, with full power
      of substitution.

     

    Dated:
      _______________________      

    

    Signed:
      _______________________     

    

    Signature
      guaranteed:  

     

    _______________________

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

       

    

    SUBSCRIPTION
      AGREEMENT

    FOR
      THE EXERCISE OF WARRANTS

    

    The
      undersigned hereby irrevocably subscribes for the purchase of _____________
      Shares pursuant to and in accordance with the terms and conditions of this
      Warrant, which Shares should be delivered to the undersigned at the address
      stated below. If said number of Shares are not all of the Shares purchasable
      hereunder, a new Warrant of like tenor for the balance of the remaining Shares
      purchasable hereunder should be delivered to the undersigned at the address
      stated below.

    

    The
      undersigned elects to pay the aggregate Purchase Price for such Shares in the
      following manner:

    

    [  ] by
      the
      enclosed cash or check made payable to the Company in the amount of

    $_______________________;

    

    [  ] by
      wire
      transfer of United States funds to the account of the Company in the amount
      of
      $__________, which transfer has been made before or simultaneously with the
      delivery of this Notice pursuant to the instructions of the Company;
      or

    

    [  ] by
      conversion of the Warrant into Shares in the manner specified in Section 1.3
      of
      the Warrant.

    

    The
      undersigned agrees that: (1) the undersigned will not offer, sell, transfer
      or
      otherwise dispose of any Shares unless either (a) a registration statement,
      or
      post-effective amendment thereto, covering the Shares has been filed with the
      Securities and Exchange Commission pursuant to the Securities Act of 1933,
      as
      amended (the “Act”), such sale, transfer or other disposition is accompanied by
      a prospectus meeting the requirements of Section 10 of the Act forming a part
      of
      such registration statement, or post-effective amendment thereto, which is
      in
      effect under the Act covering the Shares to be so sold, transferred or otherwise
      disposed of, and all applicable state securities laws have been complied with,
      or (b) counsel reasonably satisfactory to Electric Aquagenics Unlimited, Inc.
      has rendered an opinion in writing and addressed to Electric Aquagenics
      Unlimited, Inc. that such proposed offer, sale, transfer or other disposition
      of
      the Shares is exempt from the provisions of Section 5 of the Act in view of
      the
      circumstances of such proposed offer, sale, transfer or other disposition;
      (2)
      Electric Aquagenics Unlimited, Inc. may notify the transfer agent for the Shares
      that the certificates for the Shares acquired by the undersigned are not to
      be
      transferred unless the transfer agent receives advice from Electric Aquagenics
      Unlimited, Inc. that one or both of the conditions referred to in (1)(a) and
      (1)(b) above have been satisfied; and (3) Electric Aquagenics Unlimited, Inc.
      may affix the legend set forth in Section 3.1 of this Warrant to the
      certificates for the Shares hereby subscribed for, if such legend is
      applicable.

     

    
      	Dated:________________________________	 	Signed:_______________________
	 	 	 
	Signature
              guaranteed:__________________	 	Address:_______________________

    

     

     

    
      
         

      

      
        10

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