Document:

THIS $1.2
MILLION LOAN AGREEMENT AND THE SECURITIES ISSUABLE HEREUNDER HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS AND MAY NOT BE TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SECURITIES
HAVE BEEN REGISTERED UNDER SUCH ACT AND ALL SUCH OTHER APPLICABLE LAWS OR AN
EXEMPTION FROM REGISTRATION IS AVAILABLE.

    

    $1.2
MILLION LOAN AGREEMENT

    

    This $1.2 Million Loan Agreement (this
“Agreement”) is
made this 21st day of
October, 2010, by and between EAU Technologies, Inc., a Delaware corporation
(the “Company”), and Peter
F. Ullrich, a resident of Florida (“Lender”).

    

    NOW, THEREFORE, in consideration of the
mutual covenants and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

    

    1.           Definitions.  For purposes of
this Agreement, the following capitalized terms have the following
meanings:

    

    “Business Day” means
any day other than (a) Saturday or Sunday or (b) any other day on which banks in
the State of New York are permitted or required to be closed.

    

    “Common Stock” means
the shares of the Company’s common stock, par value $.0001 per
share.

    

    “Common Stock
Equivalent” 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.

    

    “Control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise, and the terms “Controlling” and
“Controlled”
(and the lower-case versions of the same) shall have meanings correlative
thereto.

    

    “Conversion Price”
shall have the meaning set forth in Section 5(a), subject
to adjustment per the terms and conditions set forth in this
Agreement.

    

    “Interest Rate” shall
have the meaning set forth in Section
3.

    

    “Maturity Date” shall
have the meaning set forth in Section
4(a).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    “Person” means an
individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.

    

    2.           Agreement
to Lend.  Holder hereby
agrees to lend the $1.2 Million (“Loan Amount”) to the
Company.  Holder and the Company agree that as of the date of this
Note, Holder has previously funded to the Company the sum of $905,000 of the
$1,200,000 that Holder has committed to loan to the Company (such committed
amount, the “Loan
Commitment”).  Holder has agreed to fund the remaining portion
of the Loan Commitment in such amounts and at such times as follow:

     

    
      
        
          
            
              
                	
                        Payment Date

                      	 	
                        Funded Amount

                      	 
	
                        On
      or before October 31, 2010

                      	 	$	100,000	 
	
                        On
      or before November 30, 2010

                      	 	$	195,000	 

              

            

          

        

      

    

     

    Such
funds will be delivered by Holder to the Company by wire transfer of immediately
available funds.

    

    Notwithstanding
anything to the contrary set forth herein, in the event Holder fails to fund the
full amount of the Loan Commitment on or prior to the Maturity Date, this Note
shall be deemed to have been amended to reduce the Loan Amount to the portion of
the Loan Commitment actually funded by Holder, without any further action on the
part of the Company or Holder.

    

    3.           Interest.  Simple interest
shall accrue (computed on the basis of actual days elapsed and a year of 360
days) at the rate of ten percent (10%) per annum on the unpaid principal amount
of this Agreement outstanding (such interest rate being referred to as the
“Interest
Rate”).

    

    4.           Payment.

    

    (a)           Maturity
Date.  Accrued interest and the outstanding principal balance
shall be due and payable in a single lump-sum payment on December 1, 2011 (the
“Maturity
Date”).

    

    (b)           Prepayment.  Accrued
interest and the outstanding principal balance can be prepaid, in whole or in
part, at any time prior to the Maturity Date without premium or penalty of any
kind whatsoever.

    

    5.           Conversion.

    

    (a)           Optional Conversion
Right.  Until such time as all of the obligations under this
Agreement are paid in full, Lender shall have the option, exercisable in its
sole discretion, to convert all or any portion of the outstanding principal and
interest due pursuant to this Agreement into shares of Common Stock at a price
per share equal to $1.00 per share (subject to the adjustments as set forth in
Section 7
hereof) (the “Conversion
Price”).

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    (b)           [Intentionally
Omitted].

    

    (c)           Conversion
Procedure.

    

    (i)           Prior
to the conversion in accordance with this Section 5, the
Company shall take all necessary steps to ensure that such number of shares of
Common Stock as are issuable upon conversion are available for such
issuance.

    

    (ii)          Any
such conversion shall be deemed to have been effected as of the close of
business on the date on which a written conversion request is delivered from
Lender to the Company specifying the amount of principal, or principal and
interest, to be converted. At such time as such conversion has been effected,
the rights of Lender as such Lender to the extent of the conversion shall cease,
and Lender shall be deemed to have become the holder of record of the shares of
Common Stock represented thereby.

    

    (iii)         As
soon as possible after a conversion has been effected (but in any event within
thirty (30) business days), the Company shall deliver to Lender, a certificate
or certificates representing the number of shares of Common Stock (excluding any
fractional share) issuable by reason of such conversion in such name or names
and such denomination or denominations as Lender has specified to the Company in
writing.

    

    (iv)         If
any fractional share of Common Stock would, except for the provisions hereof, be
deliverable upon conversion, the Company, in lieu of delivering such fractional
share, shall pay an amount equal to the value of such fractional
share.

    

    (v)          The
issuance of certificates for the shares of Common Stock upon conversion shall be
made without charge to Lender for any issuance tax in respect thereof or other
cost incurred by the Company in connection with such conversion and the related
issuance of the shares of Common Stock.  Upon conversion, the Company
shall take all such actions as are necessary in order to ensure that the shares
of Common Stock issuable with respect to such conversion shall be validly
issued, fully paid and nonassessable.

    

    (vi)         The
Company shall not close its books against the transfer of the shares of Common
Stock issued or issuable upon conversion in any manner which interferes with the
timely conversion.  Lender, upon the request of the Company, shall
assist and cooperate with the Company in making any required governmental
filings or in obtaining any government approval prior to or in connection with
the conversion (including, without limitation, making any filings required to be
made by the Company).

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    (vii)        The
Company shall take all such actions as may be necessary to assure that all such
shares of Common Stock may be so issued without violation of any applicable law
or governmental regulation or any requirements of any domestic securities
exchange upon which shares of Common Stock may be listed (except for official
notice of issuance which shall be immediately delivered by the Company upon each
issuance).

    

    (viii)       If
(A) the Company shall take a record of the holders of its shares of Common Stock
(or other securities at the time receivable upon the conversion) for the purpose
of entitling them to receive any dividend or other distribution, or any right to
subscribe for or purchase any securities, or to receive any other right or
otherwise proposes to make a dividend or distribution; (B) there is proposed any
capital reorganization of the Company, any reclassification of the equity
interests of the Company, any consolidation or merger of the Company with or
into another entity, or any conveyance of all or substantially all of the assets
of the Company to another entity; (C) any voluntary dissolution, liquidation or
winding-up of the Company; or (D) any redemption or conversion of outstanding
shares of Common Stock into any other type of securities then, and in each such
case, the Company will mail or cause to be mailed to Lender a notice in
accordance with Section 13
specifying, as the case may be, (I) the date on which a record is to be taken
for the purpose of such dividend, distribution or right, and stating the amount
and character of such dividend, distribution or right, or (II) the date on which
such reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation, winding up, redemption or conversion is to take place,
and the time, if any is to be fixed, as of which the holders of record of the
shares of Common Stock (or at the time receivable upon the conversion) shall be
entitled to exchange their shares of Common Stock (or such other securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding up.  Such written notice shall be given at least 30 days prior
to the transaction in question and not less than 10 days prior to the record
date in respect thereof.

    

    (d)           Partial
Exercise.  Upon conversion, the portion of principal and
interest hereunder that has not been converted shall remain due and payable by
the Company according to the terms and conditions set forth in this
Agreement.

    

    6.           Use of
Proceeds.  The proceeds from
this Agreement shall be used by the Company in any manner determined by the
Company.

    

    7.           Adjustment
of Conversion Price.  The Conversion
Price with respect to the shares of Common Stock shall be subject to adjustment
from time to time as follows:

    

    (a)           Stock
Splits.  If the Company at any time or from time to time after
the date of this Agreement effects a subdivision of the outstanding Common
Stock, the Conversion 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 date of this Agreement combines the outstanding
shares of Common Stock, the Conversion Price then in effect immediately before
the combination shall be proportionately increased.  Any adjustment
under this subsection (a) shall become effective at the close of business on the
date the subdivision or combination becomes effective.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    (b)           Dividends and
Distributions.  In the event the Company at any time or from
time to time after the date of the Agreement 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 Conversion Price then in effect shall be proportionally
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.

    

    (c)           Recapitalization or
Reclassification.  If the shares of Common Stock issuable upon
the conversion of the amounts due pursuant to this Agreement 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 7), then, and
in any such event, Lender shall thereafter be entitled to receive upon
conversion of the amounts due pursuant to this Agreement such number and kind of
stock or other securities or property of the Company to which a holder of shares
deliverable upon conversion of the amounts due pursuant to this Agreement would
have been entitled on such reclassification or other change, subject to further
adjustment as provided herein.

    

    (d)           [Intentionally
Omitted].

    

    (e)           [Intentionally
Omitted].

    

    (f)           No
Adjustment.  No adjustment in the Conversion 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 subparagraph (f) 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 7 shall be
made to the nearest cent (with $.005 being rounded upward).  Anything
in this Section
7 to the contrary notwithstanding, the Company shall be entitled, to the
extent permitted by law, to make such reductions in the Conversion Price, in
addition to those required by this Section 7, 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

        
          

        

      

      
         

      

    

    

    8.           Amendment.  Except as
otherwise expressly provided herein, the provisions of this Agreement may be
amended and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company has
obtained the prior written consent of Lender.

    

    9.           Waiver.  The failure of
Lender to insist on full compliance with any provision of this Agreement in a
particular instance shall not result in a waiver or relinquishment of any right
or obligation herein, and shall not preclude Lender from requiring full
compliance with any provision of this Agreement thereafter.

    

    10.         Interpretation.  For
the purposes of this Agreement, all dollar amounts and references to “$” or
“Dollar” shall be deemed to refer to United States of America
dollars.  Whenever the context of this Agreement permits, the
masculine gender shall include the feminine and neuter genders, and any
reference to the singular or plural shall be interchangeable with the
other.

    

    11.         Place of
Payment.  Payments of
principal and interest are to be paid to Lender by wire transfer in accordance
with the following instructions:

    

    Peter F. Ullrich

    1800 N.W. 89th
Place

    Miami, FL 33172

    Email:  peteru@esmaraldainc.com

    

    or to
such other address or to the attention of such other person as specified by
prior written notice to the Company.

    

    12.         Governing
Law.  This Agreement
shall be governed by and construed in accordance with, the laws of the State of
Delaware.

    

    13.         Notices. All notices, consents and
other communications hereunder shall be in writing and shall be deemed to have
been duly given when delivered by hand or by Federal Express or a similar
overnight courier to the party for whom intended, at the address for such party
set forth below (or at such other address for a party as shall be specified by
like notice, provided, however, that any
notice of change of address shall be effective only upon receipt):

    

    
      
        	
                if to Lender:

              	
                Peter F. Ullrich

              
	 
      	
                1800 NW 89th Place

              
	 
      	
                Miami, Florida  33172

              
	 
      	 
      
	
                if to the Company:

              	
                EAU Technologies, Inc.

              
	 
      	
                1890 Cobb International Blvd., Suite A

              
	 
      	
                Kennesaw, Georgia  30152

              
	 
      	
                Attention: Wade R. Bradley, President and

              
	 
      	
                CEO

              

      

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    The
parties hereto agree that notices or other communications that are sent in
accordance herewith (i) by personal delivery will be deemed received on the day
sent or on the first business day thereafter if not sent on a business day, (ii)
by overnight delivery, will be deemed received on the first business day
immediately following the date sent, and (iii) by U.S. mail, will be deemed
received three (3) business days immediately following the date
sent.

    

    (Remainder
of page intentionally left blank)

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
parties have executed and delivered this Agreement on the date first written
above.

    

    
      
        
          	
                  COMPANY:

                
	 
      
	
                  EAU
      TECHNOLOGIES, INC.

                
	 
      	 
      
	
                  By:

                	
                  /s/ Wade R. Bradley

                
	 
      	
                  Wade
      R. Bradley

                
	 
      	
                  Chief
      Executive Officer

                
	 
      	 
      
	
                  LENDER:

                
	 
      
	
                  PETER
      F. ULLRICH

                
	 
      	 
      
	 
      	
                  /s/ Peter F. Ullrich

                
	 
      	
                  Peter
      F. Ullrich

                

        

      

    

    
      
         

      

      
        8THIS
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

      

      EAU
TECHNOLOGIES, INC.

      

      Void
After 5 P.M. on the Five Anniversary of this Warrant

      

      Warrant
to Purchase 6,969,231 Shares of Common Stock

      

      THIS IS TO CERTIFY, that, for
value received, Peter F. Ullrich, a resident of Florida or registered assigns
(the “Holder”),
is entitled, subject to the terms and conditions hereinafter set forth, on or
after the date on which this Warrant (this “Warrant”) is executed
and delivered by each of the parties hereto (the “Exercise Commencement
Date”), and at any time prior to 5 P.M., Eastern Standard Time (“EST”), on the fifth
anniversary of the Exercise Commencement Date, but not thereafter, to purchase
such number of shares of Common Stock, par value $0.000l (“Common Stock” or the
“Shares”), of
EAU Technologies, Inc. (the “Company”) from the
Company as set forth above and upon payment to the Company of an amount per
Share of $0.31 (the “Purchase Price”), 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. EST on the Exercise Commencement Date, but no later than 5:00
P.M. EST on the fifth anniversary of the Exercise Commencement Date (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 Kennesaw, Georgia, 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. 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          [INTENTIONALLY
OMITTED]

      

      1.4          [INTENTIONALLY
OMITTED]

                

      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 1.7 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: (a) funds sufficient to pay any transfer tax, and (b) an opinion of counsel
reasonably satisfactory to the Company to the effect that the assignment or
transfer has been made in compliance with applicable federal and state
securities laws. 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
Certificates. 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 this 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.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      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          [INTENTIONALLY
OMITTED]

                

      2.5          [INTENTIONALLY
OMITTED]

                

      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.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

       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:

      

      EAU
Technologies, Inc.

      1890 Cobb
International Blvd., Suite A

      Kennesaw,
GA 30152

      Telephone
No.: (678) 388-9492

      Attention:          Wade
R. Bradley, President

      

      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.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      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)

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      IN WITNESS WHEREOF, the
parties hereto, intending to be legally bound, have executed and delivered this
agreement as of the date of the later of the signatures below.

      

      
        
          
            
              
                
                  
                    	
                            EAU
      TECHNOLOGIES,

                            INC.

                          	 
      	
                            PETER
      F. ULLRICH

                          
	 
      	 
      	 
      
	
                            By:
      /s/ Wade R. Bradley

                          	 
      	
                            By:
      /s/ Peter Ullrich

                          
	
                            Wade
      R. Bradley

                          	 
      	
                            Peter
      Ullrich

                          
	
                            Chief
      Executive Officer

                          	 
      	 
      
	 
      	 
      	 
      
	
                            Date:10/21/2010

                          	 
      	
                            Date:
      10/21/2010

                          

                  

                

              

            

          

        

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      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:

              
	
                __________________________________

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      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  $                 
 ; or

      

      [ ]
          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.

      

      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 EAU Technologies, Inc. has rendered an opinion in
writing and addressed to EAU Technologies, 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) EAU Technologies, 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 EAU Technologies, Inc. that one or both of the conditions referred
to in (1)(a) and (1)(b) above have been satisfied; and (3) EAU Technologies,
Inc. may affix the legend set forth in Section 3 of this Warrant to the
certificates for the Shares hereby subscribed for, if such legend is
applicable.

      

      
        	
                Dated:
      

                ____________________________________________

              	
                Signed:
      

                _________________________________

              
	 
      	 
      
	 
      	
                Address:
      

                ________________________________

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