Document:

FORM
      OF ADDITIONAL WARRANT

     

    THIS
      WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
      BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
      AND MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED, TRANSFERRED OR OTHERWISE
      DISPOSED OF, UNLESS REGISTERED PURSUANT TO THE PROVISIONS OF THE SECURITIES
      ACT
      OR AN OPINION OF COUNSEL IS OBTAINED STATING THAT SUCH DISPOSITION IS IN
      COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH
      REGISTRATION.

     

    __________,
      2006

     

    O2DIESEL
      CORPORATION 

     

    Warrant
      for the Purchase of Common Stock
      (Void
      after __________, 2010)

     

    No.
      W-________

     

    FOR
      VALUE
      RECEIVED, this Warrant is hereby issued by O2DIESEL CORPORATION, a Delaware
      corporation (the “Company”), to Energenics Holdings PTE Ltd, having its
      registered office at 7 Temaek Boulevard, Suntec City Tower 1 #04-01A, Singapore
      038987 (the “Holder”). Subject to the provisions of this Warrant, the Company
      hereby grants to Holder the right to purchase ____________ shares of the
      Company’s common stock, par value $.0001 per share (“Common Stock”), at
      US$1.1664 per share during the period of six (6) months to sixty-six (66) months
      following the [Note:
      to be the date the Holder receives the Additional Warrant]
      (“Exercise Price”). 

     

    The
      Holder agrees with the Company that this Warrant is issued, and all the rights
      hereunder shall be held, subject to all of the conditions, limitations and
      provisions set forth herein.

     

    1.  Exercise
      of Warrant.
      Subject
      to the terms and conditions set forth herein, the Holder may exercise this
      Warrant on or after _________, 2007 and no later than __________, 2013. To
      exercise this Warrant the Holder shall present and surrender this Warrant to
      the
      Company at its principal office, with the Warrant Exercise Form, attached hereto
      as Appendix
      A,
      duly
      executed by the Holder and accompanied by payment in cash or by check, payable
      to the order of the Company, of the aggregate Exercise Price for the total
      aggregate number of securities for which this Warrant is exercised. The Common
      Stock deliverable upon such exercise, and as adjusted from time to time, are
      hereinafter referred to as “Warrant Stock.”

     

    Upon
      receipt by the Company of this Warrant, together with the executed Warrant
      Exercise Form and payment of the Exercise Price, if any, for the securities
      to
      be acquired, in proper form for exercise, and subject to the Holder’s compliance
      with all requirements of this Warrant for the exercise hereof, the Holder shall
      be deemed to be the holder of record of the Warrant Stock issuable upon such
      exercise, notwithstanding that the stock transfer books of the Company shall
      then be closed or that certificates representing such securities shall not
      then
      be actually delivered to the Holder; provided, however, that no exercise of
      this
      Warrant shall be effective, and the Company shall have no obligation to issue
      any Warrant Stock to the Holder upon any attempted exercise of this Warrant,
      unless the Holder shall have first delivered to the Company, in form and
      substance reasonably satisfactory to the Company, appropriate representations
      so
      as to provide the Company reasonable assurances that the securities issuable
      upon exercise may be issued without violation of the registration requirements
      of the Securities Act and applicable state securities laws, including without
      limitation representations that the exercising Holder is an “accredited
      investor” as defined in Regulation D under the Securities Act and that the
      Holder is familiar with the Company and its business and financial condition
      and
      has had an opportunity to ask questions and receive documents relating thereto
      to his reasonable satisfaction. 

     

    
      
         

      

      
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    2.  Reservation
      of Shares.
      The
      Company will reserve for issuance and delivery upon exercise of this Warrant
      all
      shares of Warrant Stock. All such shares shall be duly authorized and, when
      issued upon such exercise, shall be validly issued, fully paid and
      non-assessable and free of all preemptive rights.

     

    3.  Assignment
      or Loss of Warrant.
      Subject
      to the transfer restrictions herein (including Section 6), upon surrender of
      this Warrant to the Company or at the office of its stock transfer agent, if
      any, with the Assignment Form, attached hereto as Appendix
      B,
      duly
      executed and funds sufficient to pay any transfer tax, the Company shall,
      without charge, execute and deliver a new Warrant in the name of the assignee
      named in such instrument of assignment and this Warrant shall promptly be
      canceled. Upon receipt by the Company of evidence reasonably satisfactory to
      it
      of the loss, theft, destruction or mutilation of this Warrant, and of reasonably
      satisfactory indemnification by the Holder, and upon surrender and cancellation
      of this Warrant, if mutilated, the Company shall execute and deliver a
      replacement Warrant of like tenor and date.

     

    4.  Rights
      of the Holder.
      The
      Holder shall not, by virtue hereof, be entitled to any rights of a stockholder
      in the Company, either at law or in equity, and the rights of the Holder are
      limited to those expressed in this Warrant.

     

    5.  Adjustments.

     

    (a)  Adjustment
      for Recapitalization.
      If the
      Company shall at any time after the date hereof subdivide its outstanding shares
      of Common Stock by recapitalization, reclassification or split-up thereof,
      or if
      the Company shall declare a stock dividend or distribute shares of Common Stock
      to its shareholders, the number of shares of Common Stock subject to this
      Warrant immediately prior to such subdivision shall be proportionately
      increased, and if the Company shall at any time after the date hereof combine
      the outstanding shares of Common Stock by recapitalization, reclassification
      or
      combination thereof, the number of shares of Common Stock subject to this
      Warrant immediately prior to such combination shall be proportionately
      decreased. 

     

    (b)  Adjustment
      for Reorganization, Consolidation, Merger, Etc.
      If at
      any time after the date hereof the Company has a Change in Control, the Holder
      agrees that, either (a) Holder shall exercise its purchase right under this
      Warrant and such exercise will be deemed effective immediately prior to the
      consummation of such Change in Control or (b) if the Holder elects not to
      exercise the Warrant, this Warrant will expire upon the consummation of the
      Change of Control. For purposes of this Warrant, a “Change in Control” shall be
      deemed to occur in the event of a change in ownership or control of the Company
      effected through any of the following transactions: (i) the acquisition,
      directly or indirectly, by any person or related group of persons (other than
      the Company or a person that immediately
      before the Change of Control directly
      or indirectly controls, or is controlled by, or is under common control with,
      the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the
      Securities Exchange Act of 1934, as amended) of outstanding
      securities possessing more than fifty percent (50%) of the total combined voting
      power of the Company’s outstanding securities;
      or (ii)
      the sale, transfer or other disposition of all or substantially all of the
      Company’s assets; or (iii) the consummation of a merger or consolidation of the
      Company with or into another entity or any other corporate reorganization,
      if
      more than fifty percent (50%) of the combined voting power of the continuing
      or
      surviving entity’s securities outstanding immediately after such merger,
      consolidation or other reorganization is owned by persons who were not
      stockholders of the Company immediately prior to such merger, consolidation
      or
      other reorganization.

     

    
      
         

      

      
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    (c)  Certificate
      as to Adjustments.
      The
      adjustments provided in this Section 5 shall be interpreted and applied by
      the Company in such a fashion so as to reasonably preserve the applicability
      and
      benefits of this Warrant (but not to increase or diminish the benefits
      hereunder). In each case of an adjustment in the number of shares of Common
      Stock receivable on the exercise of the Warrant, the Company at its expense
      will
      promptly compute such adjustment in accordance with the terms of the Warrant
      and
      prepare a certificate executed by two executive officers of the Company setting
      forth such adjustment and showing in detail the facts upon which such adjustment
      is based. The Company will mail a copy of each such certificate to each
      Holder.

     

    (d)  Notices
      of Record Date, Etc.
      In the
      event that:

     

    (i)  the
      Company shall declare any dividend or other distribution to the holders of
      Common Stock, or authorizes the granting to Common Stock holders of any right
      to
      subscribe for, purchase or otherwise acquire any shares of stock of any class
      or
      any other securities; or

     

    (ii)  the
      Company has a Change in Control; or

     

    (iii)  the
      Company authorizes any voluntary or involuntary dissolution, liquidation or
      winding up of the Company,

     

    then,
      and
      in each such case, the Company shall mail or cause to be mailed to the holder
      of
      this Warrant at the time outstanding a notice specifying, as the case may be,
      (a) the date on which a record is to be taken for the purpose of such dividend,
      distribution or right, and stating the amount and character of such dividend,
      distribution or right, or (b) the date on which such reorganization,
      reclassification, consolidation, merger, conveyance, dissolution, liquidation
      or
      winding up is to take place, and the time, if any is to be fixed, as to which
      the holders of record of Common Stock shall be entitled to exchange their shares
      of Common Stock for securities or other property deliverable upon such
      reorganization, reclassification, consolidation, merger, conveyance,
      dissolution, liquidation or winding up. Such notice shall be mailed at least
      20
      days prior to the date therein specified.

     

    
      
         

      

      
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    (e)  No
      Impairment.
      The
      Company will not, by any voluntary action, avoid or seek to avoid the observance
      or performance of any of the terms to be observed or performed hereunder by
      the
      Company, but will at all times in good faith assist in the carrying out of
      all
      the provisions of this Section 5 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 impairment.

     

    6.  Transfer
      to Comply with the Securities Act.
      This
      Warrant and any Warrant Stock may not be sold, transferred, pledged,
      hypothecated or otherwise disposed of except as follows: (a) to a person who,
      in
      the opinion of counsel to the Company, is a person to whom this Warrant or
      the
      Warrant Stock may legally be transferred without registration and without the
      delivery of a current prospectus under the Securities Act with respect thereto
      and then only against receipt of an agreement of such person to comply with
      the
      provisions of this Section 6 with respect to any resale or other disposition
      of
      such securities; or (b) to any person upon delivery of a prospectus then meeting
      the requirements of the Securities Act relating to such securities and the
      offering thereof for such sale or disposition, and thereafter to all successive
      assignees.

     

    7.  Reports
      Under Securities Exchange Act of 1934.
      With a
      view to making available to the Holder the benefits of Rule 144 under the
      Securities Act (“Rule 144”) and any other rule or regulation of the Securities
      Exchange Commission (“Commission”) that may at any time permit a Holder to sell
      securities of the Company to the public without registration, the Company
      shall:

     

    (a)  make
      and
      keep public information available, as required by Rule 144, at all
      times;

     

    (b)  file
      with
      the Commission in a timely manner all reports and other documents required
      of
      the Company under the Securities Act and the Exchange Act; and

     

    (c)  furnish
      to the Holder forthwith upon request (i) a written statement by the Company
      that
      it has complied with the reporting requirements of Rule 144, the Securities
      Act
      and the Exchange Act; (ii) a copy of the most recent annual or quarterly report
      of the Company and such other reports and documents so filed by the Company
      and
      (iii) such other information as may be reasonably requested in availing any
      Holder of any rule or regulation of the Commission which permits the selling
      of
      any such securities without registration.

     

    8.  Legend. 

     

    (a)  Unless
      the shares of Warrant Stock have been registered under the Securities Act,
      upon
      exercise of this Warrant and the issuance of any of the shares of Warrant Stock,
      all certificates representing shares shall bear on the face thereof
      substantially the following legend:

     

    
      
         

      

      
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    THE
      SECURITIES
      REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED BY THE HOLDER FOR ITS OWN
      ACCOUNT, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO THE DISTRIBUTION OF
      SUCH
      SECURITIES. THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED (THE “ACT”),
      OR
      ANY APPLICABLE STATE SECURITIES LAWS AND MAY
      NOT
      BE
      SOLD OR OTHERWISE TRANSFERRED EXCEPT (I)
      PURSUANT
      TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND COMPLIANCE WITH SUCH
      STATE SECURITIES LAWS, (II)
      IN
      COMPLIANCE WITH RULE 144 UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS,
      OR
(III) UPON
      THE DELIVERY TO O2DIESEL CORPORATION (THE
      “COMPANY”)
      OF AN
      OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE COMPANY THAT SUCH
      REGISTRATION AND/ OR COMPLIANCE IS NOT REQUIRED.

     

    

     

    (b)  The
      legend requirements shall terminate when (i) the shares in question shall have
      been effectively registered under the Securities Act and disposed of pursuant
      thereto or (ii) the Company shall have received an opinion of counsel reasonably
      satisfactory to it that such legend is not required in order to insure
      compliance with the Securities Act.

     

    (c)  Upon
      termination of the legend requirements as per Section 8(b) above, the Company
      shall instruct its transfer agent to issue a new share certificate at no cost
      to
      the Holder without a legend limiting the sale or transfer of the
      shares.

     

    9.  Notices.
      All
      notices required hereunder shall be in writing and shall be deemed given when
      telegraphed, delivered personally or within two days after mailing when mailed
      by certified or registered mail, return receipt requested, to the Company or
      the
      Holder, as the case may be, for whom such notice is intended, if to the Holder,
      at the address of such party as set forth in the Common Stock and Warrant
      Purchase Agreement, or if to the Company, O2Diesel Corporation, 100 Commerce
      Drive, Suite 301, Newark, Delaware 19713 or at such other address of which
      the
      Company or the Holder has been advised by notice hereunder.

     

    10.  Applicable
      Law.
      The
      Warrant is issued under and shall for all purposes be governed by and construed
      in accordance with the laws of the State of Delaware, without regard to the
      conflict of laws provisions of such State.

     

    
      
         

      

      
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    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be signed on its behalf,
      in its corporate name, by its duly authorized officer, all as of the day and
      year first above written.

     

    

     

    O2Diesel
      Corporation

    

    

    By:_____________________

    Alan
      R.
      Rae

    Chief
      Executive Officer

    

    

    
      
         

      

      
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    Appendix
      A

     

    WARRANT
      EXERCISE FORM

     

    The
      undersigned hereby irrevocably elects to (i) exercise the within Warrant to
      purchase __________ shares of the Common Stock of O2DIESEL CORPORATION, a
      Delaware corporation, pursuant to the provisions of Section 1 of the attached
      Warrant, and hereby makes payment of $__________ in payment therefor, or (ii)
      exercise this Warrant for the purchase of _______ shares of Common Stock,
      pursuant to the provisions of Section 1 of the attached Warrant. The
      undersigned’s execution of this form constitutes the undersigned’s agreement to
      all the terms of the Warrant and to comply therewith.

     

     

    _____________________________________

    Signature

    

    Print
      Name:____________________________

    

    

     

    ____________________________________

    Signature,
      if jointly held

    

    Print
      Name:___________________________

    

    Date:________________________________

    

     

    
 

    
      
         

      

      
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    Appendix
      B

     

    ASSIGNMENT
      FORM

     

    FOR
      VALUE
      RECEIVED_____________________________ (“Assignor”) hereby sells, assigns and
      transfers unto _______________________________ (“Assignee”) all of Assignor’s
      right, title and interest in, to and under Warrant No. W-____ issued by
      ____________________________, dated ______________.

     

    DATED:
      _________________

     

    ASSIGNOR:

     

    ___________________________________________

    Signature

    Print
      Name: 

     

     

    ___________________________________________

    Signature,
      if jointly held

    Print
      Name:__________________________________

     

    ASSIGNEE:

     

    The
      undersigned agrees to all of the terms of the Warrant and to comply
      therewith.

     

     

    ___________________________________________

    Signature

    Print
      Name:__________________________________

    

     

    ___________________________________________

    Signature,
      if jointly held

    Print
      Name:__________________________________

    

    
      
         

      

      
        8AMENDMENT
      NO. 1 TO

    COMMON
      STOCK AND WARRANT PURCHASE AGREEMENT 

    

      This
      Amendment No. 1 (the “Amendment”) to the Common Stock and Warrant Purchase
      Agreement, dated as of September 15th,
      2006
      (the “Purchase Agreement”), is made as of November 9, 2006 (the “Execution
      Date”), by and among O2Diesel Corporation, a Delaware corporation (the
“Company”), and Energenics Holdings Pte Ltd (the “Purchaser”).

     

    WHEREAS,
      the parties previously entered into the Purchase Agreement; and

    

    WHEREAS,
      the parties have determined that it is important to correct the minimum purchase
      amount in Section 1.4 of the Purchase Agreement.

    

    NOW,
      THEREFORE, in consideration of the mutual promises and covenants herein, the
      receipt and sufficiency of which are hereby acknowledged, and intending to
      be
      legally bound, the parties hereto agree as follows:

    

    1.
      AMENDMENT TO SECTION 1.4 OF THE PURCHASE AGREEMENT. 

    

    The
      last
      sentence of Section 1.4 of the Purchase Agreement is hereby amended in its
      entirety to read as follows:

     

    “The
      purchase of the Additional Shares shall occur if Energenics purchases * million
      liters of O2D05 or the equivalent in any calendar year, pursuant to the Supply
      Agreement.” 

    

    2.
      GENERAL. 

    

    Except
      as
      herein provided, the Purchase Agreement shall remain in full force and effect.
      

    

    [Remainder
      of Page Intentionally Left Blank] 

     

     

     

     

     

     

     

     

     

     

    
      [*]
        =
        CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
        WITH
        THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
        REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. OMITTED TEXT IS INDICATED
        BY A
“*”.

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    The
      foregoing agreement is hereby executed effective as of the date first set first
      set forth above. 

    

    O2DIESEL
      CORPORATION

    

    

    By:
      /s/
      Alan R. Rae

    Name: 
      Alan R. Rae

    Title:   
      Chief
      Executive Officer

    

    

    ENERGENICS
      HOLDINGS PTE LTD

    

    

    By:  /s/
      Ronen Hazarika

    Name:  
      Ronen
      Hazarika

    Title:    
      Director

    

     

    
 

    [Signature
      Page to Amendment No. 1 to Common Stock and Warrant Purchase
      Agreement]

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