Document:

Unassociated Document

    EXHIBIT
      10.3

     

     

    THIS
      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
      AND PUT AGREEMENT

    

    For
      the
      Purchase of Shares of Common Stock of

    

    EAU
      TECHNOLOGIES, INC.

    

    Void
      After 5 P.M. May 9, 2010

    

                        Date: May
      9,
      2007

    

    Warrant
      to Purchase 3,230,769 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., Eastern Standard Time (“EST”), on May 9, 2010 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 $1.30 (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. Eastern Time, as the case may be, on the date hereof (the “Exercise
      Commencement Date”), but no later than 5:00 P.M., Eastern Time, May 9, 2010 (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 Put
      Right.

     

    1.3.1 The
      Company shall have the right, but not the obligation (the “Put
      Right”),
      to
      require Holder to exercise all, or a portion of, this Warrant by delivering
      a
      written notice to Holder (the “Put
      Notice”)
      on or
      prior to the Expiration Time. The Put Notice shall specify the number of Shares
      which Holder is required to purchase from the Company pursuant to this Warrant,
      such determination as to the number of Shares to be purchased to be made in
      the
      Company’s sole and absolute discretion. The Company shall not exercise the Put
      Right more than one time in any calendar month.

     

    1.3.2 Within
      fourteen (14) calendar days following its receipt, or deemed receipt, of the
      Put
      Notice, Holder shall exercise the Warrant for the number of Shares specified
      in
      the Put Notice. Holder shall pay the Purchase Price for each Share. The Purchase
      Price shall be paid by wire transfer of immediately available Federal funds
      to
      the account specified by the Company in the Put Notice. The failure of Holder
      to
      exercise the Warrant in a timely manner and consistent with the terms of the
      Put
      Notice shall be an event of default of this Warrant, and the Company shall
      have
      the right to seek legal and equitable remedies from Holder. In addition, upon
      such default, this Warrant, and any other then-outstanding warrant, option
      or
      other right to convert or exchange an instrument for Shares shall automatically
      and irrevocably terminate, including, without limitation, that certain warrant
      for 5,169,231 Shares issued by the Company to Holder on even date
      herewith.

    

    1.3.3 The
      proceeds from the Holder’s exercise of the Warrant (including, without
      limitation, the exercise of the Warrant as a result of the Put Right) can be
      used in any manner determined by the Company in its sole and absolute
      discretion, including, without limitation, for working capital, acquisitions,
      capital expenses, and employee bonuses.

    

    

    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 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: (i) funds sufficient to pay any transfer tax, and (ii) 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 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.

     

    

    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,
      this
      Warrant has been duly executed by the Company as of May __, 2007.

     

    
      	
              EAU
                TECHNOLOGIES, INC.

            
	
               

            
	 
	
              By:
                /s/
                Wade R. Bradley

            
	
              Wade
                R. Bradley

            
	
              Chief
                Executive Officer

            
	 
	
              WATER
                SCIENCE, LLC

            
	 
	
              By:
                /s/
                Peter Ullrich

            
	
              Peter
                Ullrich

            
	
              Manager

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    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 
$_____________;

    

    [
      ]
 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

    

    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 3.1 of this Warrant
      to the certificates for the Shares hereby subscribed for, if such legend is
      applicable.

    

    
      	
              Dated:
                ____________________________________________

            	
              Signed:
                _________________________________

            
	
               

            	
               

            
	
              Signature
                guaranteed: ________________________________

            	
              Address:
                ________________________________Unassociated Document

    EXHIBIT
      10.4

     

    
 

    AMENDED
      AND RESTATED

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
      is
      entered into as of May 9, 2007, by and between EAU Technologies, Inc., a
      Delaware corporation (the “Company”),
      and
      Water Science, LLC, a Florida limited liability company (the “Investor”).

     

    RECITALS

     

    WHEREAS,
      prior
      to the date hereof, the Investor owned warrants to purchase 8,400,000 shares
      of
      Common Stock of the Company at an exercise price of $2.76 per share, 6,400,000
      of which expire on May 1, 2009 and 2,000,000 of which expire on September 16,
      2008 (collectively, the “Original
      Warrants”);

    

    WHEREAS,
      in
      connection with that certain Agreement Terminating Warrants and Registration
      Rights Agreement of even date herewith (the “Termination
      Agreement”),
      by
      and between the Company and the Investor, the Original Warrants were cancelled
      and the Investor was issued (i) a Warrant to purchase 5,169,231 shares of the
      Company’s Common Stock at an exercise price of $1.30 per share, which expires on
      the third anniversary hereof and (ii) a Warrant to purchase 3,230,769 shares
      of
      the Company’s Common Stock at an exercise price of $1.30 per share, which
      expires on the third anniversary hereof ((i) and (ii), collectively, the
“Warrants”);
      

    

    WHEREAS,
      the
      shares underlying the Original Warrants, together with 1,600,000 shares of
      the
      Company’s Common Stock issued to the Investor on May 1, 2006 and up to 1,000,000
      shares of Common Stock issuable upon conversion of that certain Senior Secured
      Convertible Promissory Note in the principal amount of $3,000,000 issued to
      the
      Investor on September 16, 2005 (“Convertible Note”), were subject to the
      registration rights granted to the Investor pursuant to the Registration Rights
      Agreement, dated as of September 16, 2005, and the Registration Rights
      Agreement, dated as of May 1, 2006 (collectively, the “Initial
      Registration Rights Agreements”);
      and

     

    WHEREAS,
      the
      Company and the Investor deem it to be in their respective best interests to
      set
      forth the rights of the Investor in connection with the sale of shares of Common
      Stock and upon exercise of the Warrants and/or conversion of the Convertible
      Note (the “Registrable
      Shares”)
      and
      terminate the Initial Registration Rights Agreements, and are entering into
      this
      Agreement as a condition to and in connection with the Termination
      Agreement.

     

    NOW,
      THEREFORE,
      in
      consideration of the premises and other good and valuable consideration, the
      receipt and sufficiency of which are hereby acknowledged, each of the parties
      hereto hereby agrees as follows:

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    AGREEMENT

     

    1.  Registration
      Rights.

     

    (a)
       Beginning
      on the date hereof but no later than 45 days after the date hereof (the
“Registration
      Period”),
      the
      Company shall use its best efforts to prepare and file with the Securities
      and
      Exchange Commission (the “SEC”),
      a
      registration statement and such other documents as may be necessary, and use
      its
      best efforts to have such registration statement declared effective as soon
      as
      reasonably practicable after such filing, so as to permit the registered resale
      of the Registrable Shares, for a period of two (2) years following the issuance
      of the last Registrable Share; provided,
      however,
      that
      the Registration Period may be extended to the extent of any delay in (i) the
      receipt of the questionnaires from the Investor as required by Section
      5(b)
      below,
      and (ii) Investor’s compliance with the beneficial ownership reporting
      requirements under Sections 13 and 16 of the Securities Exchange Act of 1934,
      as
      amended. The Company will include in such registration statement the information
      required under the Securities Act of 1933, as amended (the “Securities
      Act”)
      to be
      so included concerning the Investor, as provided by the Investor pursuant to
      this Agreement and any other agreements between the parties, including any
      changes in such information that may be provided by the Investor in writing
      to
      the Company from time to time. 

     

    (b) Notwithstanding
      the foregoing provisions of this Section
      1,
      the
      Company may voluntarily suspend the effectiveness of any such registration
      statement for a limited time, which in no event shall be longer than 60 days
      in
      any three-month period and no longer than 120 days in any twelve month period,
      if the Company has been advised in writing by counsel or underwriters to the
      Company that the offering of any Registrable Shares pursuant to the registration
      statement would materially adversely affect, or would be improper in view of
      (or
      improper without disclosure in a prospectus), a proposed financing,
      reorganization, recapitalization, merger, consolidation, or similar transaction
      involving the Company, in which case the Company shall keep such registration
      statement effective for an additional period of time beyond two (2) years
      following the last issuance of a Registrable Share equal to the number of days
      the effectiveness thereof is suspended pursuant to this provision. The Company
      shall notify the Investor to such effect, and, upon receipt of such notice,
      the
      Investor shall immediately discontinue any sales of Registrable Shares pursuant
      to such registration statement until the Investor has received copies of a
      supplemented or amended prospectus or until the Investor is advised in writing
      by the Company that the then current prospectus may be used and has received
      copies of any additional or supplemental filings that are incorporated or deemed
      incorporated by reference in such prospectus.

     

    (c) If
      any
      event occurs that would cause any such registration statement to contain a
      material misstatement or omission or not to be effective and usable during
      the
      period that such registration statement is required to be effective and usable,
      the Company shall promptly notify the Investor of such event and, if requested,
      the Investor shall immediately cease making offers of Registrable Shares and
      return all prospectuses to the Company. The Company shall promptly file an
      amendment to the registration statement to correct such misstatement or omission
      and use its commercially reasonable efforts to cause such amendment to be
      declared effective as soon as practicable thereafter. The Company shall promptly
      provide the Investor with revised prospectuses and, following receipt of the
      revised prospectuses, the Investor shall be free to resume making offers of
      the
      Registrable Shares. In the event of such an occurrence, the Company shall keep
      such registration statement effective for an additional period of time beyond
      two (2) years following the last issuance of a Registrable Share equal to the
      number of days the effectiveness thereof is suspended pursuant to this
      provision.

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (d) Notwithstanding
      any provision contained herein to the contrary, the Company’s obligation to
      include, or continue to include, Registrable Shares in any such registration
      statement under this Section
      1
      shall
      terminate to the extent such shares are eligible for resale under Rule 144(k)
      promulgated under the Securities Act. In addition, the Company’s obligation to
      include, or continue to include, Registrable Shares in any such registration
      will be suspended during any periods during which the Investor is delinquent
      in
      his beneficial ownership reporting requirements under the Securities Exchange
      Act of 1934, as amended.

     

    (e) If
      and
      whenever the Company is required by the provisions of this Agreement to use
      its
      commercially reasonable efforts to effect the registration of the Registrable
      Shares under the Securities Act for the account of the Investor, the Company
      will, as promptly as possible:

     

    (i)
      prepare and file with the SEC a registration statement complying with applicable
      requirements under the Securities Act with respect to such securities and use
      its commercially reasonable efforts to cause such registration statement to
      become and remain effective;

    

    (ii)
      prepare and file with the SEC such amendments and supplements to such
      registration statement and the prospectus used in connection therewith as may
      be
      necessary to keep such registration statement effective and to comply with
      the
      requirements of the Securities Act and the rules and regulations promulgated
      by
      the SEC thereunder relating to the sale or other disposition of the securities
      covered by such registration statement; and

     

    (iii)
      furnish to the Investor such numbers of copies of a prospectus complying with
      the requirements of the Securities Act, and such other documents as the Investor
      may reasonably request in order to facilitate the public sale or other
      disposition of the Registrable Shares owned by the Investor, but the Investor
      shall not be entitled to use any selling materials other than a prospectus
      and
      such other materials as may be approved by the Company, which approval will
      not
      be unreasonably withheld.

     

    (f) As
      a
      condition to the inclusion of the Investor’s Registrable Securities in any
      registration statement, the Investor will furnish in writing to the Company
      such
      information with respect to the Investor as is required to be disclosed in
      the
      registration statement (and the prospectus included therein) by the applicable
      rules, regulations and guidelines of the Securities Exchange Commission.

    

    (g) The
      expenses incurred by the Company in connection with action taken by the Company
      to comply with this Section
      1,
      including, without limitation, all registration and filing fees, printing and
      delivery expenses, accounting fees, fees and disbursements of counsel to the
      Company, consultant and expert fees, and premiums for liability insurance,
      if
      the Company chooses to obtain such insurance, obtained in connection with a
      registration statement filed to effect such compliance and all expenses,
      including counsel fees, of complying with any state securities laws, shall
      be
      paid by the Company. All fees and disbursements of any counsel, experts, or
      consultants employed by the Investor shall be borne by the Investor. The Company
      shall not be obligated in any way in connection with any registration pursuant
      to this Section
      1
      for any
      selling commissions or discounts payable by the Investor to any underwriter
      or
      broker of securities to be sold by the Investor. The Investor agrees that any
      such selling commissions or discounts shall be borne by the
      Investor.

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (h) The
      Company will indemnify and hold harmless the Investor, its officers, directors
      and each underwriter of such securities, and any person who controls the
      Investor or underwriter within the meaning of Section 15 of the Securities
      Act
      (each an “Investor
      Indemnified Party”),
      against all claims, actions, losses, damages, liabilities and expenses, joint
      or
      several, to which any of such persons may become subject under the Securities
      Act or otherwise, insofar as such losses, claims, damages, liabilities or
      actions arise out of or are based upon any untrue statement of any material
      fact
      contained in any registration statement under which such securities were
      registered under the Securities Act, any preliminary prospectus or final
      prospectus contained therein, or any amendment or supplement thereof, or arise
      out of or are based upon the omission to state therein a material fact required
      to be stated therein or necessary to make the statements therein, in light
      of
      the circumstances under which they were made, not misleading, and will reimburse
      such Investor Indemnified Party for any legal and any other expenses reasonably
      incurred by such Investor Indemnified Party in connection with investigating
      or
      defending any such loss, claim, damage, liability, or action; provided,
      however,
      that
      the Company will not be liable in any such case to the extent that any such
      loss, claim, damage, liability or action arises directly out of or is based
      primarily upon an untrue statement or omission made in said registration
      statement, said preliminary prospectus or said prospectus, or said amendment
      or
      supplement in reliance upon and in conformity with written information furnished
      to the Company by the Investor or such underwriter specifically for use in
      the
      preparation thereof.

    

    (i) At
      any
      time when a prospectus relating to the Registrable Shares is required to be
      delivered under the Securities Act, the Company will notify the Investor of
      the
      happening of any event, upon the notification or awareness of such event by
      an
      executive officer of the Company, as a result of which the prospectus included
      in such registration statement, as then in effect, includes an untrue statement
      of material fact or omits to state a material fact required to be stated therein
      or necessary to make the statements therein not misleading in light of the
      circumstances then existing.

     

    (j) In
      the
      event of any registration of any securities under the Securities Act pursuant
      to
      this Section
      1,
      the
      Investor agrees to indemnify and hold harmless the Company, its officers,
      directors and any person who controls the Company within the meaning of Section
      15 of the Securities Act (each a “Company
      Indemnified Party”),
      against any losses, claims, damages, liabilities, or actions, joint or several,
      to which a Company Indemnified Party may become subject under the Securities
      Act
      or otherwise, insofar as such losses, claims, damages, liabilities, or actions
      arise out of or are based upon any untrue statement of any material fact
      contained in any registration statement under which such securities were
      registered under the Securities Act, any preliminary prospectus or final
      prospectus contained therein, or any amendment or supplement thereto, or arise
      out of or are based upon the omission to state therein a material fact required
      to be stated therein or necessary to make the statements therein not misleading,
      in each case to the extent that any such loss, claim, damage, liability, or
      action arises out of or is based upon an untrue statement or omission made
      in
      said registration statement, preliminary prospectus or prospectus or amendment
      or supplement in reliance upon and in conformity with written information
      furnished to the Company by the Investor or any affiliate (as defined in the
      Securities Act) of the Investor specifically for use in the preparation
      thereof.

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (k) Any
      party
      entitled to indemnification hereunder will (i) give prompt written notice to
      the
      indemnifying party of any claim with respect to which it seeks indemnification,
      and (ii) unless in such indemnified party’s reasonable judgment, based upon
      advise of counsel, a conflict of interest between such indemnified and
      indemnifying parties may exist with respect to such claim, permit such
      indemnifying party to assume the defense of such claim with counsel reasonably
      satisfactory to the indemnified party. If such defense is assumed, the
      indemnified party will not be subject to any liability for any settlement made
      by the indemnifying party without its consent (which consent may not be
      unreasonably withheld). An indemnifying party who is not entitled to, or elects
      not to, assume the defense of a claim will not be obligated to pay the fees
      and
      expenses of more than one counsel for all parties indemnified by such
      indemnifying party, based upon advise of counsel, with respect to such claim,
      unless in the reasonable judgment of any indemnified party a conflict of
      interest may exist between such indemnified party and any other of such
      indemnified parties with respect to such claim.

     

    (l) With
      a
      view to making available to the Investor the benefits of Rule 144 promulgated
      under the Securities Act, the Company agrees that it will use its commercially
      reasonable efforts to maintain registration of its Common Stock under Section
      12
      or 15 of the Securities Exchange Act of 1934, as amended (the “Exchange
      Act”),
      and
      to file with the SEC in a timely manner all reports and other documents required
      to be filed by an issuer of securities registered under the Exchange Act so
      as
      to maintain the availability of Rule 144. Upon the request of any record owner,
      the Company will deliver to such owner a written statement as to whether it
      has
      complied with the reporting requirements of Rule 144.

     

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

     

    (a) The
      Investor is acquiring the Registrable Shares for its own account, for investment
      and not with a view to, or for resale in connection with, any distribution
      or
      public offering thereof within the meaning of the Securities Act, and applicable
      state securities laws.

     

    (b) The
      Investor acknowledges that the certificate(s) representing the Registrable
      Shares acquired by the Investor shall bear a restrictive legend substantially
      as
      follows:

     

    THIS
      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.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (c) The
      Investor acknowledges that the Registrable Shares will be “restricted
      securities” within the meaning of Rule 144 under the Securities Act, are subject
      to restrictions on transferability and resale and may not be transferred or
      resold except as permitted under the Securities Act and applicable state
      securities laws, pursuant to registration or exemption therefrom. The Investor
      is aware that the Investor may be required to bear the financial risks of this
      investment for an indefinite period of time.

    (d) The
      Investor further represents and warrants that the Investor is an “accredited
      investor” within the meaning of Rule 501(a) of Regulation D under the Securities
      Act.

     

    (e) (i)
      The
      Investor has full power and authority to execute and deliver this Agreement,
      (ii) the execution and delivery by the Investor of this Agreement and the
      performance by it of its obligations hereunder have been authorized by all
      necessary action of the Investor, (iii) the Termination Agreement has been
      duly
      and validly executed and delivered by the Investor and constitutes the legal,
      valid and binding obligation of the Investor, and (iv) this Agreement is
      enforceable against the Investor in accordance with its terms.

     

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

     

    (a) The
      Company is duly incorporated, validly existing and in good standing under the
      laws of its state of incorporation, and is duly qualified to do business as
      a
      foreign corporation in all jurisdictions in which the failure to be so qualified
      would materially and adversely affect the business or financial condition,
      properties or operations of the Company.

     

    (b) The
      Company has duly authorized the issuance and sale of the Registrable Shares
      in
      accordance with the terms of this Agreement (as described herein) by all
      requisite corporate action, including the authorization of the Company’s Board
      of Directors of the issuance and sale of the Registrable Shares in accordance
      herewith, and the execution, delivery and performance of any other agreements
      and instruments executed in connection herewith. This Agreement constitutes
      a
      valid and legally binding obligation of the Company, enforceable in accordance
      with its terms, except (i) as limited by applicable bankruptcy, insolvency,
      reorganization, moratorium, and other laws of general application affecting
      enforcement of creditors’ rights generally, (ii) as limited by laws relating to
      the availability of specific performance, injunctive relief, or other equitable
      remedies, and (iii) to the extent the indemnification provisions contained
      herein may be limited by applicable federal or state securities
      laws.

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    4. Survival;
      Indemnification.
      All
      representations, warranties, covenants and the indemnification obligations
      contained in this Agreement shall survive (i) the acceptance of this Agreement
      by the Company, (ii) changes in the transactions, documents and instruments
      described herein which are not material or which are to the benefit of the
      Investor, and (iii) the liquidation or dissolution of the Investor. The Investor
      understands the meaning and legal consequences of the representations,
      warranties and covenants in Section
      2
      hereof
      and that the Company has relied upon such representations, warranties and
      covenants in determining the Investor’s qualification and suitability to
      purchase Registrable Shares. The Investor hereby agrees to indemnify, defend
      and
      hold harmless the Company and its respective officers, directors, employees,
      agents and controlling persons, from and against any and all losses, claims,
      damages, liabilities, expenses (including attorneys’ fees and disbursements),
      judgments or amounts paid in settlement of actions arising out of or resulting
      from the untruth of any representation of the Investor herein or the breach
      of
      any warranty or covenant of the Investor made herein. Notwithstanding the
      foregoing, no representation, warranty, covenant or acknowledgment made herein
      by the Investor shall in any manner be deemed to constitute a waiver of any
      rights granted to it under the Securities Act or state securities laws or
      otherwise.

     

    5. Additional
      Rights and Obligations. 

    

    (a) The
      Initial Registration Rights Agreements are hereby terminated.

    

    (b) The
      Investor shall timely file all beneficial ownership reports as required by
      the
      Exchange Act.

    

    (b)
       In
      connection with the registration of any Registrable Securities pursuant to
      any
      registration statement, the Investor shall:

    

    (i) within
      ten (10) days of the date hereof, complete and deliver to the Company a selling
      security holder questionnaire to include the information required under
Section
      2(f)
      hereof;

    

    (ii) promptly
      notify the Company when the Investor has sold such Registrable Securities;
      and

    

    (iii) promptly
      notify the Company in the event that any information supplied by the Investor
      in
      writing for inclusion in such registration statement or related prospectus
      or
      any document referred to therein is untrue or omits to state a material fact
      required to be stated therein or necessary to make such information not
      misleading.

     

    6. Notices.
      Any
      notice, request or other document required or permitted to be given or delivered
      to the Investor or the Company shall be in writing and shall be delivered or
      sent to the Investor at the Investor’s address as shown on the books of the
      Company or to the Company at its principal place of business and shall be deemed
      received by the Investor or the Company, as the case may be, upon personal
      delivery, or upon delivery by overnight courier or three days following deposit
      in the U.S. mail (sent registered or certified and postage
      prepaid).

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    7. Assignability.
      This
      Agreement is not assignable by the Investor, and may not be modified, waived
      or
      terminated except by an instrument in writing signed by the party against whom
      enforcement of such modification, waiver or termination is sought.

     

    8. Binding
      Effect.
      Except
      as otherwise provided herein, this Agreement shall be binding upon and inure
      to
      the benefit of the parties and their respective heirs, executors,
      administrators, successors, legal representatives and permitted assigns, and
      the
      agreements, representations, warranties and acknowledgments contained herein
      shall be deemed to be made by and be binding upon such heirs, executors,
      administrators, successors, legal representatives and permitted
      assigns.

     

    9. Obligations
      Irrevocable.
      The
      obligations of the Investor shall be irrevocable, except with the consent of
      the
      Company, until the issuance of the Registrable Shares.

     

    10. Entire
      Agreement.
      This
      Agreement and the Termination Agreement constitute the entire agreement of
      the
      Investor and the Company relating to the matters contained herein, superseding
      all prior contracts or agreements, whether oral or written.

     

    11. Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Delaware, without regard to the principles of conflicts of law thereof
      that would require the application of the laws of any jurisdiction other than
      Delaware.

     

    12. Severability.
      If any
      provision of this Agreement or the application thereof to the Investor or any
      circumstance shall be held invalid or unenforceable to any extent, the remainder
      of this Agreement and the application of such provision to other subscriptions
      or circumstances shall not be affected thereby and shall be enforced to the
      greatest extent permitted by law.

     

    13. Headings.
      The
      headings in this Agreement are inserted for convenience and identification
      only
      and are not intended to describe, interpret, define, or limit the scope, extent
      or intent of this Agreement or any provision hereof.

     

    14. Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which when
      so
      executed and delivered shall be deemed to be an original and all of which
      together shall be deemed to be one and the same agreement.

     

    (Remainder
      of Page Intentionally Left Blank)

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties have caused the execution of this Agreement by
      their duly authorized representatives as of the day and the year first above
      written.

     

    
      	
               

            	
              EAU
                TECHNOLOGIES, INC. 

            
	
               

            	 
	
               

            	 
	
               

            	
              By: 
                /s/ Wade R. Bradley

            
	 	
              Wade
                R. Bradley 

            
	 	
              Chief
                Executive Officer 

            
	 	 
	
               

            	 
	
               

            	 
	
               

            	
              WATER
                SCIENCE, LLC 

            
	
               

            	 
	
               

            	 
	
               

            	
              By:  
                /s/ Peter Ullrich

            
	 	
              Peter
                Ullrich 

            
	 	
              Sole
                Member 

            

    

    

    

    
      
        
        

      

      
        9

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