Exhibit 10.1

 

THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE "SUBSCRIPTION AGREEMENT")
RELATES TO AN OFFERING OF SECURITIES IN AN OFFSHORE TRANSACTION TO PERSONS WHO
ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").

NONE OF THE SECURITIES TO WHICH THIS SUBSCRIPTION AGREEMENT RELATES HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO
REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT.

PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

(Non U.S. Subscribers)

TO:

UREX ENERGY CORP. (the “Company”)
10580 N. McCarran Blvd.
Building 115-208
Reno, Nevada 89503
USA

COPY TO:

CLARK WILSON LLP
800 – 885 West Georgia Street
Vancouver, BC V6C 3H1
Attention: Virgil Z. Hlus
Facsimile: 604.687.6314

Purchase of Units

1.

SUBSCRIPTION

1.1           The undersigned (the “Subscriber”) hereby irrevocably subscribes
for and agrees to purchase ________________ units (the “Units”) at a price of
US$0.25 per Unit (such subscription and agreement to purchase being the
“Subscription”), for an aggregate purchase price of US$____________ (the
“Subscription Proceeds”), which is tendered herewith, on the basis of the
representations and warranties and subject to the terms and conditions set forth
herein.

1.2          Each Unit will consist of one common share in the capital of the
Company (each, a “Share”), one-half of one Series A common share purchase
warrant (each, a “Series A Warrant”), subject to adjustment, and one-half of one
Series B common share purchase warrant (each, a “Series B Warrant”), subject to
adjustment (the Series A Warrants and the Series B Warrants being referred to as
the “Warrants”). The Warrants shall be non-transferable and each whole Warrant
shall entitle the holder thereof to purchase one share of common stock in the
capital of the Company (each, a “Warrant Share”), as presently constituted. Each
whole Series A Warrant shall be exercisable for a period of one (1) year
commencing from the Closing (as hereinafter defined), at a price per Warrant
Share of US$0.50. Each whole Series B Warrant shall be exercisable for a period
of two (2) years commencing from the Closing, at a price per Warrant Share of
US$1.00. Certificates representing the Series A Warrants will be in the form
attached as Exhibit A and certificates representing the Series B Warrants will
be in the form attached as Exhibit B. The Shares, Warrants and Warrant Shares
are referred to as the “Securities”.

1.3           The Company hereby irrevocably agrees to sell, on the basis of the
representations and warranties and subject to the terms and conditions set forth
herein, to the Subscriber the Units. Subject to the terms hereof, the
Subscription will be effective upon its acceptance by the Company.

 

D/VXD/888264.2

 

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1.4           Unless otherwise provided, all dollar amounts referred to in this
Subscription Agreement are in lawful money of the United States of America.

2.

PAYMENT

2.1           The Subscription Proceeds must accompany this Subscription and
shall be wired directly to the Company's lawyers in accordance with the wire
instructions attached hereto as Exhibit C. The Subscriber authorizes the
Company's lawyers to deliver the Subscription Proceeds to the Company on the
Closing Date.

2.2           The Subscriber acknowledges and agrees that this Subscription
Agreement, the Subscription Proceeds and any other documents delivered in
connection herewith will be held by the Company's lawyers on behalf of the
Company. In the event that this Subscription Agreement is not accepted by the
Company for whatever reason within 30 days of the delivery of an executed
Subscription Agreement by the Subscriber, this Subscription Agreement, the
Subscription Proceeds and any other documents delivered in connection herewith
will be returned to the Subscriber at the address of the Subscriber as set forth
in this Subscription Agreement.

2.3           Where the Subscription Proceeds are paid to the Company, the
Company is entitled to treat such Subscription Proceeds as an interest free loan
to the Company until such time as the Subscription is accepted and the
certificates representing the Shares and Warrants have been issued to the
Subscriber.

3.

DOCUMENTS REQUIRED FROM SUBSCRIBER

3.1           The Subscriber must complete, sign and return to the Company two
(2) executed copies of this Subscription Agreement.

3.2           The Subscriber shall complete, sign and return to the Company as
soon as possible, on request by the Company, any documents, questionnaires,
notices and undertakings as may be required by regulatory authorities, the OTC
Bulletin Board, stock exchanges and applicable law.

4.

CLOSING

4.1          Closing of the offering (the “Offering”) of the Units (the
“Closing”) shall occur on or before November 30, 2006, or on such other date as
may be determined by the Company (the “Closing Date”). The Company may, at its
discretion, elect to close the Offering in one or more closings, in which event
the Company may agree with one or more subscribers (including the Subscriber
hereunder) to complete delivery of the Shares and the Warrants to such
subscriber(s) against payment therefor at any time on or prior to the Closing
Date.

5.

ACKNOWLEDGEMENTS OF SUBSCRIBER

5.1          The Subscriber acknowledges and agrees that:

 

(a)

none of the Securities have been or will be registered under the 1933 Act, or
under any state securities or “blue sky” laws of any state of the United States,
and, unless so registered, may not be offered or sold in the United States or,
directly or indirectly, to U.S. Persons (as defined herein), except in
accordance with the provisions of Regulation S, pursuant to an effective
registration statement under the 1933 Act, or pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of the 1933 Act
and in each case only in accordance with applicable state securities laws;

 

(b)

other than as set forth herein, the Company has not undertaken, and will have no
obligation, to register any of the Securities under the 1933 Act or any other
securities legislation;

 

(c)

the Subscriber has received and carefully read this Subscription Agreement;

 

D/VXD/888264.2

 

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(d)

the decision to execute this Subscription Agreement and purchase the Securities
agreed to be purchased hereunder has not been based upon any oral or written
representation as to fact or otherwise made by or on behalf of the Company and
such decision is based entirely upon a review of any public information which
has been filed by the Company with the Securities and Exchange Commission (the
“SEC”) in compliance, or intended compliance, with applicable securities
legislation (collectively, the “Public Record”);

 

(e)

there are risks associated with an investment in the Securities, as more fully
described in certain information forming part of the Public Record;

 

(f)

the Subscriber and the Subscriber's advisor(s) have had a reasonable opportunity
to ask questions of and receive answers from the Company in connection with the
sale of the Securities hereunder, and to obtain additional information, to the
extent possessed or obtainable by the Company without unreasonable effort or
expense;

 

(g)

the books and records of the Company were available upon reasonable notice for
inspection, subject to certain confidentiality restrictions, by the Subscriber
during reasonable business hours at its principal place of business and that all
documents, records and books in connection with the sale of the Securities
hereunder have been made available for inspection by the Subscriber, the
Subscriber's attorney and/or advisor(s);

 

(h)

all of the information which the Subscriber has provided to the Company is
correct and complete as of the date the Subscription Agreement is signed, and if
there should be any change in such information prior to this Subscription
Agreement being executed by the Company, the Subscriber will immediately provide
the Company with such information;

 

(i)

the Subscriber will indemnify and hold harmless the Company and, where
applicable, its respective directors, officers, employees, agents, advisors and
shareholders from and against any and all loss, liability, claim, damage and
expense whatsoever (including, but not limited to, any and all fees, costs and
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any claim, lawsuit, administrative proceeding or investigation whether
commenced or threatened) arising out of or based upon any representation or
warranty of the Subscriber contained herein or in any document furnished by the
Subscriber to the Company in connection herewith being untrue in any material
respect or any breach or failure by the Subscriber to comply with any covenant
or agreement made by the Subscriber to the Company in connection therewith;

 

(j)

the issuance and sale of the Securities to the Subscriber will not be completed
if it would be unlawful or if, in the discretion of the Company acting
reasonably, it is not in the best interests of the Company;

 

(k)

the Subscriber has been advised to consult the Subscriber's own legal, tax and
other advisors with respect to the merits and risks of an investment in the
Securities and with respect to applicable resale restrictions, and it is solely
responsible (and the Company is not in any way responsible) for compliance with:

 

(i)

any applicable laws of the jurisdiction in which the Subscriber is resident in
connection with the distribution of the Securities hereunder, and

 

(ii)

applicable resale restrictions;

 

(l)

none of the Securities are listed on any stock exchange or automated dealer
quotation system and no representation has been made to the Subscriber that any
of the Securities will become listed on any stock exchange or automated dealer
quotation system, except that currently certain market makers make market in the
common shares of the Company on the OTC Bulletin Board;

 

D/VXD/888264.2

 

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(m)

the Subscriber is outside the United States when receiving and executing this
Subscription Agreement and is acquiring the Securities as principal for its own
account, for investment purposes only, and not with a view to, or for, resale,
distribution or fractionalization thereof, in whole or in part, and no other
person has a direct or indirect beneficial interest in such Securities;

 

(n)

none of the Securities may be offered or sold to a U.S. Person or for the
account or benefit of a U.S. Person (other than a distributor) prior to the end
of the Distribution Compliance Period (as defined herein);

 

(o)

no documents in connection with this offering have been reviewed by the SEC or
any state securities administrators;

 

(p)

neither the SEC nor any other securities commission or similar regulatory
authority has reviewed or passed on the merits of the Securities or has reviewed
any documents in connection with the sale of the Securities hereunder;

 

(q)

the Company will refuse to register the transfer of the Securities not made in
accordance with the provisions of Regulation S, pursuant to an effective
registration statement under the 1933 Act or pursuant to an available exemption
from the registration requirements of the 1933 Act and in each case in
accordance with applicable state securities laws;

 

(r)

there is no government or other insurance covering any of the Securities;

 

(s)

the Subscriber has not acquired the Securities as a result of, and will not
itself engage in, any “directed selling efforts” (as defined in Regulation S
under the 1933 Act) in the United States in respect of any of the Securities
which would include any activities undertaken for the purpose of, or that could
reasonably be expected to have the effect of, conditioning the market in the
United States for the resale of any of the Securities; provided, however, that
the Subscriber may sell or otherwise dispose of any of the Securities pursuant
to registration of any of the Securities pursuant to the 1933 Act and any
applicable state securities laws or under an exemption from such registration
requirements and as otherwise provided herein;

 

(t)

the statutory and regulatory basis for the exemption claimed for the offer and
sale of the Securities, although in technical compliance with Regulation S,
would not be available if the offering is part of a plan or scheme to evade the
registration provisions of the 1933 Act; and

 

(u)

this Subscription Agreement is not enforceable by the Subscriber unless it has
been accepted by the Company, and the Subscriber acknowledges and agrees that
the Company reserves the right to reject any Subscription for any reason.

6.

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER

6.1           The Subscriber hereby represents and warrants to and covenants
with the Company (which representations, warranties and covenants shall survive
the Closing) that:

 

(a)

the Subscriber is not a U.S. Person;

 

(b)

the Subscriber is not acquiring the Securities for the account or benefit of,
directly or indirectly, any U.S. Person;

 

(c)

the Subscriber is resident in the jurisdiction set out under the heading “Name
and Address of Subscriber” on the signature page of this Subscription Agreement;

 

(d)

the sale of the Securities to the Subscriber as contemplated by the delivery of
this Subscription Agreement, the acceptance of it by the Company and the
issuance of the Securities to the

 

D/VXD/888264.2

 

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Subscriber complies with all applicable laws of the Subscriber’s jurisdiction of
residence or domicile and will not cause the Company to become subject to or
comply with any disclosure, prospectus or reporting requirements under any such
applicable laws;

 

(e)

the Subscriber:

 

(i)

is knowledgeable of, or has been independently advised as to, the applicable
securities laws of the securities regulators having application in the
jurisdiction in which the Subscriber is resident (the “International
Jurisdiction”) which would apply to the acquisition of the Securities,

 

(ii)

is purchasing the Securities pursuant to exemptions from prospectus or
equivalent requirements under applicable securities laws or, if such is not
applicable, the Subscriber is permitted to purchase the Securities under the
applicable securities laws of the securities regulators in the International
Jurisdiction without the need to rely on any exemptions,

 

(iii)

acknowledges that the applicable securities laws of the authorities in the
International Jurisdiction do not require the Company to make any filings or
seek any approvals of any kind whatsoever from any securities regulator of any
kind whatsoever in the International Jurisdiction in connection with the issue
and sale or resale of the Securities, and

 

(iv)

represents and warrants that the purchase of the Securities by the Subscriber
does not trigger:

 

A.

any obligation to prepare and file a prospectus or similar document, or any
other report with respect to such purchase in the International Jurisdiction, or

 

B.

any continuous disclosure reporting obligation of the Company in the
International Jurisdiction, and

the Subscriber will, if requested by the Company, deliver to the Company and the
Agent a certificate or opinion of local counsel from the International
Jurisdiction which will confirm the matters referred to in subparagraphs (ii),
(iii) and (iv) above to the satisfaction of the Company, acting reasonably;

 

(f)

the Subscriber (i) has adequate net worth and means of providing for its current
financial needs and possible personal contingencies, (ii) has no need for
liquidity in this investment, and (iii) is able to bear the economic risks of an
investment in the Securities for an indefinite period of time, and can afford
the complete loss of such investment;

 

(g)

the Subscriber is purchasing the Securities as principal for investment only and
not with a view to, or for, resale, distribution or fractionalization thereof,
in whole or in part, and, in particular, it has no intention to distribute
either directly or indirectly any of the Securities in the United States or to
U.S. Persons;

 

(h)

the Subscriber is outside the United States when receiving and executing this
Subscription Agreement;

 

(i)

the Subscriber understands and agrees that offers and sales of any of the
Securities prior to the expiration of a period of one year after the date of
original issuance of the Securities (the one year period hereinafter referred to
as the “Distribution Compliance Period”) shall only be made in compliance with
the safe harbor provisions set forth in Regulation S, pursuant to the
registration provisions of the 1933 Act or an exemption therefrom, and that all
offers and sales after the Distribution Compliance Period shall be made only in
compliance with the registration provisions

 

D/VXD/888264.2

 

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of the 1933 Act or an exemption therefrom and in each case only in accordance
with applicable state securities laws;

 

(j)

the Subscriber understands and agrees not to engage in any hedging transactions
involving any of the Securities unless such transactions are in compliance with
the provisions of the 1933 Act and in each case only in accordance with
applicable state securities laws;

 

(k)

the Subscriber acknowledges that it has not acquired the Securities as a result
of, and will not itself engage in, any “directed selling efforts” (as defined in
Regulation S under the 1933 Act) in the United States in respect of any of the
Securities which would include any activities undertaken for the purpose of, or
that could reasonably be expected to have the effect of, conditioning the market
in the United States for the resale of any of the Securities; provided, however,
that the Subscriber may sell or otherwise dispose of any of the Securities
pursuant to registration of any of the Securities pursuant to the 1933 Act and
any applicable state securities laws or under an exemption from such
registration requirements and as otherwise provided herein;

 

(l)

the Subscriber (i) is able to fend for itself in the Subscription; (ii) has such
knowledge and experience in business matters as to be capable of evaluating the
merits and risks of its prospective investment in the Securities; and (iii) has
the ability to bear the economic risks of its prospective investment and can
afford the complete loss of such investment;

 

(m)

the Subscriber is aware that an investment in the Company is speculative and
involves certain risks, including the possible loss of the investment;

 

(n)

the Subscriber has received and carefully read this Subscription Agreement;

 

(o)

the Subscriber has made an independent examination and investigation of an
investment in the Securities and the Company and has depended on the advice of
its legal and financial advisors and agrees that the Company will not be
responsible in anyway whatsoever for the Subscriber's decision to invest in the
Securities and the Company;

 

(p)

the Subscriber has the requisite knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of the
investment in the Securities;

 

(q)

the Subscriber understands and agrees that the Company and others will rely upon
the truth and accuracy of the acknowledgements, representations and agreements
contained in this Subscription Agreement and agrees that if any of such
acknowledgements, representations and agreements are no longer accurate or have
been breached, it shall promptly notify the Company;

 

(r)

the Subscriber has the legal capacity and competence to enter into and execute
this Subscription Agreement and to take all actions required pursuant hereto
and, if the Subscriber is a corporation, it is duly incorporated and validly
subsisting under the laws of its jurisdiction of incorporation and all necessary
approvals by its directors, shareholders and others have been obtained to
authorize execution and performance of this Subscription Agreement on behalf of
the Subscriber;

 

(s)

the entering into of this Subscription Agreement and the transactions
contemplated hereby do not result in the violation of any of the terms and
provisions of any law applicable to, or, if applicable, the constating documents
of, the Subscriber or of any agreement, written or oral, to which the Subscriber
may be a party or by which the Subscriber is or may be bound;

 

(t)

the Subscriber has duly executed and delivered this Subscription Agreement and
it constitutes a valid and binding agreement of the Subscriber enforceable
against the Subscriber;

 

D/VXD/888264.2

 

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(u)

the Subscriber is not an underwriter of, or dealer in, the common shares of the
Company, nor is the Subscriber participating, pursuant to a contractual
agreement or otherwise, in the distribution of the Securities;

 

(v)

the Subscriber understands and agrees that none of the Securities have been
registered under the 1933 Act, or under any state securities or “blue sky” laws
of any state of the United States, and, unless so registered, may not be offered
or sold in the United States or, directly or indirectly, to U.S. Persons except
in accordance with the provisions of Regulation S, pursuant to an effective
registration statement under the 1933 Act, or pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of the 1933 Act;

 

(w)

the Subscriber understands and agrees that the Company will refuse to register
any transfer of the Securities not made in accordance with the provisions of
Regulation S, pursuant to an effective registration statement under the 1933 Act
or pursuant to an available exemption from the registration requirements of the
1933 Act;

 

(x)

the Subscriber is not aware of any advertisement of any of the Securities and is
not acquiring the Securities as a result of any form of general solicitation or
general advertising including advertisements, articles, notices or other
communications published in any newspaper, magazine or similar media or
broadcast over radio or television, or any seminar or meeting whose attendees
have been invited by general solicitation or general advertising; and

 

(y)

no person has made to the Subscriber any written or oral representations:

 

(i)

that any person will resell or repurchase any of the Securities,

 

(ii)

that any person will refund the purchase price of any of the Securities,

 

(iii)

as to the future price or value of any of the Securities, or

 

(iv)

that any of the Securities will be listed and posted for trading on any stock
exchange or automated dealer quotation system or that application has been made
to list and post any of the Securities of the Company on any stock exchange or
automated dealer quotation system, except that currently certain market makers
make market in the common shares of the Company on the OTC Bulletin Board.

6.2           In this Subscription Agreement, the term “U.S. Person” shall have
the meaning ascribed thereto in Regulation S.

7.

REPRESENTATIONS AND WARRANTIES WILL BE RELIED UPON BY THE COMPANY

7.1           The Subscriber acknowledges that the representations and
warranties contained herein are made by it with the intention that such
representations and warranties may be relied upon by the Company and its legal
counsel in determining the Subscriber's eligibility to purchase the Securities
under applicable securities legislation, or (if applicable) the eligibility of
others on whose behalf it is contracting hereunder to purchase the Securities
under applicable securities legislation. The Subscriber further agrees that by
accepting delivery of the certificates representing the Securities on the
Closing Date, it will be representing and warranting that the representations
and warranties contained herein are true and correct as at the Closing Date with
the same force and effect as if they had been made by the Subscriber on the
Closing Date and that they will survive the purchase by the Subscriber of
Securities and will continue in full force and effect notwithstanding any
subsequent disposition by the Subscriber of such Securities.

 

D/VXD/888264.2

 

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8.

DEMAND REGISTRATION RIGHTS

8.1           Upon receipt of a written notice (the “Demand Notice”) from all
subscribers, including the Subscriber, participating in the Offering, the
Company shall, on only one occasion, file with the SEC not later than 45 days
after the date of receipt of the Demand Notice, and thereafter use its
reasonable commercial efforts to cause to be declared effective, a registration
statement (the "Registration Statement") (on Form S-1, Form SB-2 or such other
form that it is eligible to use) in order to register the Shares, the Warrant
Shares and such other shares as determined by the Company in its sole discretion
(the "Registrable Securities") for resale and distribution under the 1933 Act.
Notwithstanding any other provision in this Section 8, if the Company receives a
comment from the SEC which effectively results in the Company having to reduce
the number of Registrable Securities included on such Registration Statement,
then the Company may, in its sole discretion, reduce on a pro-rata basis the
number of Registrable Securities to be included in such Registration Statement.

8.2           If and whenever the Company is required by the provisions hereof
to effect the registration of any Registrable Securities under the 1933 Act, the
Company will, as expeditiously as possible:

 

(a)

subject to the timelines provided in this Subscription Agreement, prepare and
file with the SEC a Registration Statement and use its reasonable commercial
efforts to cause such Registration Statement to become and remain effective for
a period of one (1) year;

 

(b)

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 until such Registration
Statement has been effective for a period of one (1) and comply with the
provisions of the 1933 Act with respect to the disposition of all of the
Registrable Securities covered by such Registration Statement in accordance with
the Plan of Distribution set forth in such Registration Statement for such
period, provided that the Company shall be entitled to suspend the availability
of such Registration Statement for a period not to exceed 90 days (which need
not be consecutive days) in such one (1) year period;

 

(c)

furnish to the Subscriber, at the Company's expense, such number of copies of
the Registration Statement and the prospectus included therein as such persons
reasonably may request in order to facilitate the public sale or their
disposition of the securities covered by such Registration Statement;

 

(d)

use its best efforts to register or qualify the Subscriber's Registrable
Securities covered by such Registration Statement under the securities or "blue
sky" laws of such jurisdictions as the Subscriber, provided, however, that the
Company shall not for any such purpose be required to qualify generally to
transact business as a foreign corporation in any jurisdiction where it is not
so qualified or to consent to general service of process in any such
jurisdiction;

 

(e)

immediately notify the Subscriber when a prospectus relating thereto is required
to be delivered under the 1933 Act, of the happening of any event of which the
Company has knowledge as a result of which the prospectus contained in such
Registration Statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing; and

 

(f)

provided same would not be in violation of the provision of Regulation FD under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), make available
for inspection by the Subscriber, and any attorney, accountant or other agent
retained by the Subscriber or underwriter, all publicly available,
non-confidential financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors and
employees to supply all publicly available, non-confidential information
reasonably requested by the Subscriber, attorney, accountant or agent in
connection with such Registration Statement.

 

D/VXD/888264.2

 

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8.3           In connection with each Registration Statement described in this
Section 8, the Subscriber will furnish to the Company in writing such
information and representation letters with respect to itself and the proposed
distribution by it as reasonably shall be necessary in order to assure
compliance with federal and applicable state securities laws, including the
information required in Exhibit D attached hereto. The Company may require the
Subscriber to furnish to the Company a certified statement as to the number of
shares of common stock beneficially owned by the Subscriber and, if required by
the SEC, the person thereof that has voting and dispositive control over the
Shares.

8.4           All fees and expenses incident to the performance of or compliance
with the filing of the Registration Statement shall be borne by the Company
whether or not any Registrable Securities are sold pursuant to the Registration
Statement. The fees and expenses referred to in the foregoing sentence shall
include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (A) with respect to filings required to be
made with the OTC Bulletin Board or other exchange or quotation service on which
the common stock of the Company is then listed for trading, and (B) in
compliance with applicable state securities or Blue Sky laws), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the
Registrable Securities included in the Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Company, (v) 1933 Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other persons retained by the
Company in connection with the filing of the Registration Statement. In
addition, the Company shall be responsible for all of its internal expenses
incurred in connection with the filing of the Registration Statement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit and the
fees and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange, if applicable. In no event shall the
Company be responsible for any broker or similar commissions or, except to the
extent provided for hereunder, any legal fees or other costs of the Subscriber.

8.5           The Company shall, notwithstanding any termination of this
Subscription, indemnify and hold harmless the Subscriber, its officers,
directors, agents and employees, and each person who controls the Subscriber
(within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act)
and the officers, directors, agents and employees of each such controlling
person, to the fullest extent permitted by applicable law, from and against any
and all losses, claims, damages, liabilities, costs (including, without
limitation, reasonable attorneys' fees) and expenses (collectively, “Losses”),
as incurred, arising out of or relating to any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out
of or relating to any omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except to the extent, but only to the extent, that (i) such untrue statements or
omissions are based solely upon information regarding the Subscriber furnished
in writing to the Company by the Subscriber expressly for use therein, or to the
extent that such information relates to the Subscriber or the Subscriber's
proposed method of distribution of Registrable Securities and was reviewed and
expressly approved in writing by the Subscriber expressly for use in the
Registration Statement, or in any amendment or supplement thereto or (ii) the
use by the Subscriber of an outdated or defective Registration Statement after
the Company has notified the Subscriber in writing that the Registration
Statement is outdated or defective.

8.6           The Subscriber shall indemnify and hold harmless the Company, its
directors, officers, agents and employees, each person who controls the Company
(within the meaning of Section 15 of the 1933 Act and Section 20 of the 1934
Act), and the directors, officers, agents or employees of such controlling
persons, to the fullest extent permitted by applicable law, from and against all
Losses, as incurred, to the extent arising out of or based solely upon: (x) the
Subscriber's failure to comply with the prospectus delivery requirements of the
1933 Act or (y) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading (i) to the extent, but
only to the extent, that such untrue statement or omission is contained in any
information so furnished in writing by the Subscriber to the Company
specifically for inclusion in the Registration Statement or (ii) to the extent
that (1) such untrue statements or omissions are based solely upon information
regarding the Subscriber furnished in writing to the Company by the Subscriber
expressly for use therein, or to the extent that such information relates to the
Subscriber or the Subscriber's proposed method of distribution of Registrable
Securities

 

D/VXD/888264.2

 

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- 10 -

 

 

and was reviewed and expressly approved in writing by the Subscriber expressly
for use in the Registration Statement or in any amendment or supplement thereto
or the use by the Subscriber of an outdated or defective Registration Statement
after the Company has notified the Subscriber in writing that the Registration
Statement is outdated or defective. In no event shall the liability of the
Subscriber hereunder be greater in amount than the dollar amount of the net
proceeds received by the Subscriber upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

8.7           If a claim for indemnification hereunder is unavailable to either
the Company or the Subscriber (in each case, an "Indemnified Party or
Indemnified Parties", as applicable) (by reason of public policy or otherwise),
then each Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such Losses, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information supplied by,
such Indemnifying Party or Indemnified Party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth
in this Subscription, any reasonable attorneys' or other reasonable fees or
expenses incurred by such party in connection with any proceeding to the extent
such party would have been indemnified for such fees or expenses if the
indemnification provided for in this section was available to such party in
accordance with its terms.

8.8           The parties hereto agree that it would not be just and equitable
if contribution pursuant to this section were determined by pro rata allocation
or by any other method of allocation that does not take into account the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this section, no Subscriber shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by the Subscriber from the sale of the Registrable
Securities subject to the proceeding exceeds the amount of any damages that the
Subscriber has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, except in the case of
fraud by the Subscriber.

8.9           The indemnity and contribution agreements contained in this
section are in addition to any liability that the Indemnifying Parties may have
to the Indemnified Parties.

9.

RESALE RESTRICTIONS

9.1           The Subscriber acknowledges that any resale of the Securities will
be subject to resale restrictions contained in the securities legislation
applicable to each Subscriber or proposed transferee. The Subscriber
acknowledges that the Securities have not been registered under the 1933 Act of
the securities laws of any state of the United States and that the Company does
not intend to register same under the 1933 Act, or the securities laws of any
such state and has no obligation to do so. The Securities may not be offered or
sold in the United States unless registered in accordance with federal
securities laws and all applicable state securities laws or exemptions from such
registration requirements are available.

10.

ACKNOWLEDGEMENT AND WAIVER

10.1         The Subscriber has acknowledged that the decision to purchase the
Securities was solely made on the basis of publicly available information
contained in the Public Record. The Subscriber hereby waives, to the fullest
extent permitted by law, any rights of withdrawal, rescission or compensation
for damages to which the Subscriber might be entitled in connection with the
distribution of any of the Securities.

 

D/VXD/888264.2

 

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- 11 -

 

 

11.

LEGENDING AND REGISTRATION OF SUBJECT SECURITIES

11.1         The Subscriber hereby acknowledges that upon the issuance thereof,
and until such time as the same is no longer required under the applicable
securities laws and regulations, the certificates representing any of the
Securities will bear a legend in substantially the following form:

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S.
STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED
HEREIN) EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933
ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933
ACT.

11.2         The Subscriber hereby acknowledges and agrees to the Company making
a notation on its records or giving instructions to the registrar and transfer
agent of the Company in order to implement the restrictions on transfer set
forth and described in this Subscription Agreement.

12.

COSTS

12.1         The Subscriber acknowledges and agrees that all costs and expenses
incurred by the Subscriber (including any fees and disbursements of any special
counsel retained by the Subscriber) relating to the purchase of the Securities
shall be borne by the Subscriber.

13.

GOVERNING LAW

13.1         This Subscription Agreement is governed by the laws of the State of
Nevada and the federal laws applicable therein. The Subscriber, in its personal
or corporate capacity and, if applicable, on behalf of each beneficial purchaser
for whom it is acting, irrevocably attorns to the jurisdiction of the State of
Nevada.

14.

SURVIVAL

14.1         This Subscription Agreement, including without limitation the
representations, warranties and covenants contained herein, shall survive and
continue in full force and effect and be binding upon the parties hereto
notwithstanding the completion of the purchase of the Securities by the
Subscriber pursuant hereto.

15.

ASSIGNMENT

15.1         This Subscription Agreement is not transferable or assignable.

 

 

D/VXD/888264.2

 

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- 12 -

 

 

16.

EXECUTION

16.1         The Company shall be entitled to rely on delivery by facsimile
machine of an executed copy of this Subscription Agreement and acceptance by the
Company of such facsimile copy shall be equally effective to create a valid and
binding agreement between the Subscriber and the Company in accordance with the
terms hereof.

17.

SEVERABILITY

17.1         The invalidity or unenforceability of any particular provision of
this Subscription Agreement shall not affect or limit the validity or
enforceability of the remaining provisions of this Subscription Agreement.

18.

ENTIRE AGREEMENT

18.1        Except as expressly provided in this Subscription Agreement and in
the agreements, instruments and other documents contemplated or provided for
herein, this Subscription Agreement contains the entire agreement between the
parties with respect to the sale of the Securities and there are no other terms,
conditions, representations or warranties, whether expressed, implied, oral or
written, by statute or common law, by the Company or by anyone else.

19.

NOTICES

19.1         All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Subscriber shall be directed
to the address on page 10 of this Subscription Agreement and notices to the
Company shall be directed to the address on page 1 of this Subscription
Agreement.

20.

COUNTERPARTS

20.1         This Subscription Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, shall constitute an
original and all of which together shall constitute one instrument.

IN WITNESS WHEREOF the Subscriber has duly executed this Subscription Agreement
as of the date of acceptance by the Company.

DELIVERY AND REGISTRATION INSTRUCTIONS

1.

Delivery - please deliver the Share certificates to:

 

 

2.

Registration - registration of the certificates which are to be delivered at
closing should be made as follows:

______________________________________________________________________________________

(name)

______________________________________________________________________________________

(address)

 

D/VXD/888264.2

 

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- 13 -

 

 

The undersigned hereby acknowledges that he or she will deliver to the Company
all such additional completed forms in respect of the Subscriber’s purchase of
the Securities as may be required for filing with the appropriate securities
commissions and regulatory authorities.

__________________________________________

(Name of Subscriber – Please type or print)

__________________________________________

(Signature and, if applicable, Office)

__________________________________________

(Address of Subscriber)

__________________________________________

(City, State or Province, Postal Code of Subscriber)

__________________________________________

(Country of Subscriber)

 

D/VXD/888264.2

 

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- 14 -

 

 

A C C E P T A N C E

The above-mentioned Subscription Agreement in respect of the Securities is
hereby accepted by UREX ENERGY CORP.

DATED at ________________________, the _______ day of __________________, 2006.

UREX ENERGY CORP.

 

 

Per:

_____________________________________

 

Authorized Signatory

 

 

D/VXD/888264.2

 

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EXHIBIT A

FORM OF SERIES A COMMON SHARE PURCHASE WARRANT

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES, NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE, HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED
HEREIN) EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933
ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933
ACT.

 

THESE WARRANTS WILL EXPIRE AND BECOME NULL AND VOID

AT _____________ (______________ TIME) ON _________________, 200___.

SERIES A COMMON SHARE PURCHASE WARRANTS TO PURCHASE COMMON SHARES OF

UREX ENERGY CORP.

THIS IS TO CERTIFY THAT _____________________, (the "Holder") of
________________, has the right to purchase, upon and subject to the terms and
conditions hereinafter referred to, up to _______________ fully paid and
non-assessable common shares (the "Shares") in the capital of Urex Energy Corp.
(hereinafter called the "Company") on or before _______ p.m. (__________ time)
on _________________, 200____ (the "Expiry Date") at a price per Share of
US$0.50 (the "Exercise Price") on the terms and conditions attached hereto as
Appendix A (the "Terms and Conditions").

 

1.

ONE (1) WARRANT AND THE EXERCISE PRICE ARE REQUIRED TO PURCHASE ONE SHARE. THIS
CERTIFICATE REPRESENTS __________________ WARRANTS.

 

2.

These Warrants are issued subject to the Terms and Conditions, and the Warrant
Holder may exercise the right to purchase Shares only in accordance with those
Terms and Conditions.

 

3.

Nothing contained herein or in the Terms and Conditions will confer any right
upon the Holder hereof or any other person to subscribe for or purchase any
Shares at any time subsequent to the Expiry Date, and from and after such time,
this Warrant and all rights hereunder will be void and of no value.

IN WITNESS WHEREOF the Company has executed this Warrant Certificate this
________ day of ______________, 2006.

UREX ENERGY CORP.

 

 

Per:

                                                                         

Authorized Signatory

 

 

D/VXD/888264.2

 

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APPENDIX A

 

TERMS AND CONDITIONS dated _________________, 2006, attached to the Warrants
issued by Urex Energy Corp.

 

1.

INTERPRETATION

1.1

Definitions

In these Terms and Conditions, unless there is something in the subject matter
or context inconsistent therewith:

 

(a)

"Company" means Urex Energy Corp. until a successor corporation will have become
such as a result of consolidation, amalgamation or merger with or into any other
corporation or corporations, or as a result of the conveyance or transfer of all
or substantially all of the properties and estates of the Company as an entirety
to any other corporation and thereafter "Company" will mean such successor
corporation;

 

(b)

"Company's Auditors" means an independent firm of accountants duly appointed as
auditors of the Company;

 

(c)

"Director" means a director of the Company for the time being, and reference,
without more, to action by the directors means action by the directors of the
Company as a Board, or whenever duly empowered, action by an executive committee
of the Board;

 

(d)

"herein", "hereby" and similar expressions refer to these Terms and Conditions
as the same may be amended or modified from time to time; and the expression
"Article" and "Section," followed by a number refer to the specified Article or
Section of these Terms and Conditions;

 

(e)

"person" means an individual, corporation, partnership, trustee or any
unincorporated organization and words importing persons have a similar meaning;

 

(f)

"shares" means the common shares in the capital of the Company as constituted at
the date hereof and any shares resulting from any subdivision or consolidation
of the shares;

 

(g)

"Warrant Holders" or "Holders" means the holders of the Warrants; and

 

(h)

"Warrants" means the Series A common share purchase warrants of the Company
issued and presently authorized and for the time being outstanding.

1.2

Gender

Words importing the singular number include the plural and vice versa and words
importing the masculine gender include the feminine and neuter genders.

1.3

Interpretation not affected by Headings

The division of these Terms and Conditions into Articles and Sections, and the
insertion of headings are for convenience of reference only and will not affect
the construction or interpretation thereof.

1.4

Applicable Law

The Warrant and the terms hereof are governed by the laws of the State of
Nevada. The Holder, in its personal or corporate capacity and, if applicable, on
behalf of each beneficial purchaser for whom it is acting, irrevocably attorns
to the jurisdiction of the courts of the laws of the State of Nevada.

 

D/VXD/888264.2

 

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- 2 -

 

 

2.

ISSUE OF WARRANTS

2.1

Additional Warrants

The Company may at any time and from time to time issue additional warrants or
grant options or similar rights to purchase shares of its capital stock.

2.2

Warrants to Rank Pari Passu

All Warrants and additional warrants, options or similar rights to purchase
shares from time to time issued or granted by the Company, will rank pari passu
whatever may be the actual dates of issue or grant thereof, or of the dates of
the certificates by which they are evidenced.

2.3

Issue in substitution for Lost Warrants

 

(a)

In case a Warrant becomes mutilated, lost, destroyed or stolen, the Company, at
its discretion, may issue and deliver a new Warrant of like date and tenor as
the one mutilated, lost, destroyed or stolen, in exchange for and in place of
and upon cancellation of such mutilated Warrant, or in lieu of, and in
substitution for such lost, destroyed or stolen Warrant and the substituted
Warrant will be entitled to the benefit hereof and rank equally in accordance
with its terms with all other Warrants issued or to be issued by the Company.

 

(b)

The applicant for the issue of a new Warrant pursuant hereto will bear the cost
of the issue thereof and in case of loss, destruction or theft furnish to the
Company such evidence of ownership and of loss, destruction, or theft of the
Warrant so lost, destroyed or stolen as will be satisfactory to the Company in
its discretion and such applicant may also be required to furnish indemnity in
amount and form satisfactory to the Company in its discretion, and will pay the
reasonable charges of the Company in connection therewith.

2.4

Warrant Holder Not a Shareholder

The holding of a Warrant will not constitute the Holder thereof as a shareholder
of the Company, nor entitle him to any right or interest in respect thereof
except as in the Warrant expressly provided.

3.

NOTICE

3.1

Notice to Warrant Holders

Any notice required or permitted to be given to the Holders will be in writing
and may be given by prepaid registered post, electronic facsimile transmission
or other means of electronic communication capable of producing a printed copy
to the address of the Holder appearing on the Holder's Warrant or to such other
address as any Holder may specify by notice in writing to the Company, and any
such notice will be deemed to have been given and received by the Holder to whom
it was addressed if mailed, on the third day following the mailing thereof, if
by facsimile or other electronic communication, on successful transmission, or,
if delivered, on delivery; but if at the time or mailing or between the time of
mailing and the third business day thereafter there is a strike, lockout, or
other labour disturbance affecting postal service, then the notice will not be
effectively given until actually delivered.

3.2

Notice to the Company

Any notice required or permitted to be given to the Company will be in writing
and may be given by prepaid registered post, electronic facsimile transmission
or other means of electronic communication capable of producing a printed copy
to the address of the Company set forth below or such other address as the
Company may specify by notice in writing to the Holder, and any such notice will
be deemed to have been given and received by the Company to whom it was
addressed if mailed, on the third day following the mailing thereof, if by
facsimile or other electronic communication, on successful transmission, or, if
delivered, on delivery; but if at the time or mailing or between the time of
mailing and the third business day thereafter there is a strike, lockout, or
other labour disturbance affecting postal service, then the notice will not be
effectively given until actually delivered:

 

D/VXD/888264.2

 

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- 3 -

 

 

Urex Energy Corp.

10580 N. McCarran Blvd.

Building 115-208

Reno, Nevada 89503

USA

Attention: Richard Bachman

Fax No. (702) 938-8619

with a copy, which shall not constitute notice, to:

Clark Wilson LLP

Barristers and Solicitors

800 – 885 West Georgia Street

Vancouver, British Columbia

Canada V6C 3H1

 

Attention: Virgil Z. Hlus

Fax: (604) 687-6314

4.

EXERCISE OF WARRANTS

4.1

Method of Exercise of Warrants

The right to purchase shares conferred by the Warrants may be exercised by the
Holder surrendering the Warrant Certificate representing same, with a duly
completed and executed subscription in the form attached hereto and a bank draft
or certified cheque payable to the Company for the purchase price applicable at
the time of surrender in respect of the shares subscribed for in lawful money of
the United States of America, to the Company at the address set forth in, or
from time to time specified by the Company pursuant to, Section 3.2.

4.2

Effect of Exercise of Warrants

 

(a)

Upon surrender and payment as aforesaid the shares so subscribed for will be
deemed to have been issued and such person or persons will be deemed to have
become the Holder or Holders of record of such shares on the date of such
surrender and payment, and such shares will be issued at the subscription price
in effect on the date of such surrender and payment.

 

(b)

Within ten business days after surrender and payment as aforesaid, the Company
will forthwith cause to be delivered to the person or persons in whose name or
names the shares so subscribed for are to be issued as specified in such
subscription or mailed to him or them at his or their respective addresses
specified in such subscription, a certificate or certificates for the
appropriate number of shares not exceeding those which the Warrant Holder is
entitled to purchase pursuant to the Warrant surrendered.

4.3

Subscription for Less Than Entitlement

The Holder of any Warrant may subscribe for and purchase a number of shares less
than the number which he is entitled to purchase pursuant to the surrendered
Warrant. In the event of any purchase of a number of shares less than the number
which can be purchased pursuant to a Warrant, the Holder thereof upon exercise
thereof will in addition be entitled to receive a new Warrant in respect of the
balance of the shares which he was entitled to purchase pursuant to the
surrendered Warrant and which were not then purchased.

 

D/VXD/888264.2

 

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- 4 -

 

 

 

4.4

Warrants for Fractions of Shares

To the extent that the Holder of any Warrant is entitled to receive on the
exercise or partial exercise thereof a fraction of a share, such right may be
exercised in respect of such fraction only in combination with another Warrant
or other Warrants which in the aggregate entitle the Holder to receive a whole
number of such shares.

4.5

Expiration of Warrants

After the expiration of the period within which a Warrant is exercisable, all
rights thereunder will wholly cease and terminate and such Warrant will be void
and of no effect.

4.6

Time of Essence

Time will be of the essence hereof.

4.7

Subscription Price

Each Warrant is exercisable at a price per share (the "Exercise Price") of
US$0.50. One (1) Warrant and the Exercise Price are required to subscribe for
each share during the term of the Warrants.

4.8

Adjustment of Exercise Price

 

(a)

The Exercise Price and the number of shares deliverable upon the exercise of the
Warrants will be subject to adjustment in the event and in the manner following:

 

(i)

If and whenever the shares at any time outstanding are subdivided into a greater
or consolidated into a lesser number of shares the Exercise Price will be
decreased or increased proportionately as the case may be; upon any such
subdivision or consolidation the number of shares deliverable upon the exercise
of the Warrants will be increased or decreased proportionately as the case may
be.

 

(ii)

In case of any capital reorganization or of any reclassification of the capital
of the Company or in the case of the consolidation, merger or amalgamation of
the Company with or into any other Company (hereinafter collectively referred to
as a "Reorganization"), each Warrant will after such Reorganization confer the
right to purchase the number of shares or other securities of the Company (or of
the Company's resulting from such Reorganization) which the Warrant Holder would
have been entitled to upon Reorganization if the Warrant Holder had been a
shareholder at the time of such Reorganization.

In any such case, if necessary, appropriate adjustments will be made in the
application of the provisions of this Article Four relating to the rights and
interest thereafter of the Holders of the Warrants so that the provisions of
this Article Four will be made applicable as nearly as reasonably possible to
any shares or other securities deliverable after the Reorganization on the
exercise of the Warrants.

The subdivision or consolidation of shares at any time outstanding into a
greater or lesser number of shares (whether with or without par value) will not
be deemed to be a Reorganization for the purposes of this clause 4.8(a)(ii).

 

(b)

The adjustments provided for in this Section 4.8 are cumulative and will become
effective immediately after the record date or, if no record date is fixed, the
effective date of the event which results in such adjustments.

 

D/VXD/888264.2

 

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- 5 -

 

 

 

4.9

Determination of Adjustments

If any questions will at any time arise with respect to the Exercise Price or
any adjustment provided for in Section 4.8, such questions will be conclusively
determined by the Company's Auditors, or, if they decline to so act any other
firm of certified public accountants in the United States of America that the
Company may designate and who will have access to all appropriate records and
such determination will be binding upon the Company and the Holders of the
Warrants.

5.

WAIVER OF CERTAIN RIGHTS

5.1

Immunity of Shareholders, etc.

The Warrant Holder, as part of the consideration for the issue of the Warrants,
waives and will not have any right, cause of action or remedy now or hereafter
existing in any jurisdiction against any past, present or future incorporator,
shareholder, Director or officer (as such) of the Company for the issue of
shares pursuant to any Warrant or on any covenant, agreement, representation or
warranty by the Company herein contained or in the Warrant.

6.

MODIFICATION OF TERMS, ETC.

6.1

Modification of Terms and Conditions for Certain Purposes

From time to time the Company may, subject to the provisions of these presents,
modify the Terms and Conditions hereof, for the purpose of correction or
rectification of any ambiguities, defective provisions, errors or omissions
herein.

6.2

Warrants Not Transferable

The Warrant and all rights attached to it are not transferable.

DATED as of the date first above written in these Terms and Conditions.

UREX ENERGY CORP.

 

Per:                                               
                                

 

Authorized Signatory

 

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

 

FORM OF SUBSCRIPTION

TO:

Urex Energy Corp.

10580 N. McCarran Blvd.

Building 115-208

Reno, Nevada 89503

USA

The undersigned Holder of the within Warrants hereby subscribes for ____________
common shares (the "Shares") of Urex Energy Corp. (the "Company") pursuant to
the within Warrants at US$0.50 per Share on the terms specified in the said
Warrants. This subscription is accompanied by a certified cheque or bank draft
payable to or to the order of the Company for the whole amount of the purchase
price of the Shares.

The undersigned represents that, at the time of the exercise of these Warrants,
all of the representations and warranties contained in Section 6 of the
Subscription Agreement between the Company and the undersigned pursuant to which
these Warrants were issued are true and accurate.

The undersigned hereby directs that the Shares be registered as follows:

NAME(S) IN FULL

 

ADDRESS(ES)

 

NUMBER OF SHARES

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL:

 

 

(Please print full name in which share certificates are to be issued, stating
whether Mr., Mrs. or Miss is applicable).

DATED this ________ day of __________________ , ______.

In the presence of:

___________________________________________

__________________________________

Signature of Witness

Signature of Warrant Holder

Please print below your name and address in full.

Name (Mr./Mrs./Miss)

_________________________________________________________

Address

_________________________________________________________

 

_________________________________________________________

INSTRUCTIONS FOR SUBSCRIPTION

The signature to the subscription must correspond in every particular with the
name written upon the face of the Warrant without alteration or enlargement or
any change whatever. If there is more than one subscriber, all must sign. In the
case of persons signing by agent or attorney or by personal representative(s),
the authority of such agent, attorney or representative(s) to sign must be
proven to the satisfaction of the Company. If the Warrant certificate and the
form of subscription are being forwarded by mail, registered mail must be
employed.

 

D/VXD/888264.2

 

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EXHIBIT B

FORM OF SERIES B COMMON SHARE PURCHASE WARRANT

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES, NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE, HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED
HEREIN) EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933
ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933
ACT.

 

THESE WARRANTS WILL EXPIRE AND BECOME NULL AND VOID

AT _____________ (______________ TIME) ON _________________________, 200___.

SERIES B COMMON SHARE PURCHASE WARRANTS TO PURCHASE COMMON SHARES OF

UREX ENERGY CORP.

THIS IS TO CERTIFY THAT _____________________, (the "Holder") of
________________, has the right to purchase, upon and subject to the terms and
conditions hereinafter referred to, up to _______________ fully paid and
non-assessable common shares (the "Shares") in the capital of Urex Energy Corp.
(hereinafter called the "Company") on or before _______ p.m. (__________ time)
on ___________________, 200___ (the "Expiry Date") at a price per Share of
US$1.00 (the "Exercise Price") on the terms and conditions attached hereto as
Appendix A (the "Terms and Conditions").

 

1.

ONE (1) WARRANT AND THE EXERCISE PRICE ARE REQUIRED TO PURCHASE ONE SHARE. THIS
CERTIFICATE REPRESENTS __________________ WARRANTS.

 

2.

These Warrants are issued subject to the Terms and Conditions, and the Warrant
Holder may exercise the right to purchase Shares only in accordance with those
Terms and Conditions.

 

3.

Nothing contained herein or in the Terms and Conditions will confer any right
upon the Holder hereof or any other person to subscribe for or purchase any
Shares at any time subsequent to the Expiry Date, and from and after such time,
this Warrant and all rights hereunder will be void and of no value.

IN WITNESS WHEREOF the Company has executed this Warrant Certificate this
________ day of ______________, 2006.

UREX ENERGY CORP.

 

 

Per:

___________________________________

 

Authorized Signatory

 

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

 

APPENDIX A

 

TERMS AND CONDITIONS dated _________________, 2006, attached to the Warrants
issued by Urex Energy Corp.

 

1.

INTERPRETATION

1.1

Definitions

In these Terms and Conditions, unless there is something in the subject matter
or context inconsistent therewith:

 

(a)

"Company" means Urex Energy Corp. until a successor corporation will have become
such as a result of consolidation, amalgamation or merger with or into any other
corporation or corporations, or as a result of the conveyance or transfer of all
or substantially all of the properties and estates of the Company as an entirety
to any other corporation and thereafter "Company" will mean such successor
corporation;

 

(b)

"Company's Auditors" means an independent firm of accountants duly appointed as
auditors of the Company;

 

(c)

"Director" means a director of the Company for the time being, and reference,
without more, to action by the directors means action by the directors of the
Company as a Board, or whenever duly empowered, action by an executive committee
of the Board;

 

(d)

"herein", "hereby" and similar expressions refer to these Terms and Conditions
as the same may be amended or modified from time to time; and the expression
"Article" and "Section," followed by a number refer to the specified Article or
Section of these Terms and Conditions;

 

(e)

"person" means an individual, corporation, partnership, trustee or any
unincorporated organization and words importing persons have a similar meaning;

 

(f)

"shares" means the common shares in the capital of the Company as constituted at
the date hereof and any shares resulting from any subdivision or consolidation
of the shares;

 

(g)

"Warrant Holders" or "Holders" means the holders of the Warrants; and

 

(h)

"Warrants" means the Series B common share purchase warrants of the Company
issued and presently authorized and for the time being outstanding.

1.2

Gender

Words importing the singular number include the plural and vice versa and words
importing the masculine gender include the feminine and neuter genders.

1.3

Interpretation not affected by Headings

The division of these Terms and Conditions into Articles and Sections, and the
insertion of headings are for convenience of reference only and will not affect
the construction or interpretation thereof.

1.4

Applicable Law

The Warrant and the terms hereof are governed by the laws of the State of
Nevada. The Holder, in its personal or corporate capacity and, if applicable, on
behalf of each beneficial purchaser for whom it is acting, irrevocably attorns
to the jurisdiction of the courts of the State of Nevada.

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

- 2 -

 

 

2.

ISSUE OF WARRANTS

2.1

Additional Warrants

The Company may at any time and from time to time issue additional warrants or
grant options or similar rights to purchase shares of its capital stock.

2.2

Warrants to Rank Pari Passu

All Warrants and additional warrants, options or similar rights to purchase
shares from time to time issued or granted by the Company, will rank pari passu
whatever may be the actual dates of issue or grant thereof, or of the dates of
the certificates by which they are evidenced.

2.3

Issue in substitution for Lost Warrants

 

(a)

In case a Warrant becomes mutilated, lost, destroyed or stolen, the Company, at
its discretion, may issue and deliver a new Warrant of like date and tenor as
the one mutilated, lost, destroyed or stolen, in exchange for and in place of
and upon cancellation of such mutilated Warrant, or in lieu of, and in
substitution for such lost, destroyed or stolen Warrant and the substituted
Warrant will be entitled to the benefit hereof and rank equally in accordance
with its terms with all other Warrants issued or to be issued by the Company.

 

(b)

The applicant for the issue of a new Warrant pursuant hereto will bear the cost
of the issue thereof and in case of loss, destruction or theft furnish to the
Company such evidence of ownership and of loss, destruction, or theft of the
Warrant so lost, destroyed or stolen as will be satisfactory to the Company in
its discretion and such applicant may also be required to furnish indemnity in
amount and form satisfactory to the Company in its discretion, and will pay the
reasonable charges of the Company in connection therewith.

2.4

Warrant Holder Not a Shareholder

The holding of a Warrant will not constitute the Holder thereof as a shareholder
of the Company, nor entitle him to any right or interest in respect thereof
except as in the Warrant expressly provided.

3.

NOTICE

3.1

Notice to Warrant Holders

Any notice required or permitted to be given to the Holders will be in writing
and may be given by prepaid registered post, electronic facsimile transmission
or other means of electronic communication capable of producing a printed copy
to the address of the Holder appearing on the Holder's Warrant or to such other
address as any Holder may specify by notice in writing to the Company, and any
such notice will be deemed to have been given and received by the Holder to whom
it was addressed if mailed, on the third day following the mailing thereof, if
by facsimile or other electronic communication, on successful transmission, or,
if delivered, on delivery; but if at the time or mailing or between the time of
mailing and the third business day thereafter there is a strike, lockout, or
other labour disturbance affecting postal service, then the notice will not be
effectively given until actually delivered.

3.2

Notice to the Company

Any notice required or permitted to be given to the Company will be in writing
and may be given by prepaid registered post, electronic facsimile transmission
or other means of electronic communication capable of producing a printed copy
to the address of the Company set forth below or such other address as the
Company may specify by notice in writing to the Holder, and any such notice will
be deemed to have been given and received by the Company to whom it was
addressed if mailed, on the third day following the mailing thereof, if by
facsimile or other electronic communication, on successful transmission, or, if
delivered, on delivery; but if at the time or mailing or between the time of
mailing and the third business day thereafter there is a strike, lockout, or
other labour disturbance affecting postal service, then the notice will not be
effectively given until actually delivered:

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

- 3 -

 

 

Urex Energy Corp.

10580 N. McCarran Blvd.

Building 115-208

Reno, Nevada 89503

USA

Attention: Richard Bachman

Fax No. (702) 938-8619

with a copy, which shall not constitute notice, to:

Clark Wilson LLP

Barristers and Solicitors

800 – 885 West Georgia Street

Vancouver, British Columbia

Canada V6C 3H1

 

Attention: Virgil Z. Hlus

Fax: (604) 687-6314

4.

EXERCISE OF WARRANTS

4.1

Method of Exercise of Warrants

The right to purchase shares conferred by the Warrants may be exercised by the
Holder surrendering the Warrant Certificate representing same, with a duly
completed and executed subscription in the form attached hereto and a bank draft
or certified cheque payable to the Company for the purchase price applicable at
the time of surrender in respect of the shares subscribed for in lawful money of
the United States of America, to the Company at the address set forth in, or
from time to time specified by the Company pursuant to, Section 3.2.

4.2

Effect of Exercise of Warrants

 

(a)

Upon surrender and payment as aforesaid the shares so subscribed for will be
deemed to have been issued and such person or persons will be deemed to have
become the Holder or Holders of record of such shares on the date of such
surrender and payment, and such shares will be issued at the subscription price
in effect on the date of such surrender and payment.

 

(b)

Within ten business days after surrender and payment as aforesaid, the Company
will forthwith cause to be delivered to the person or persons in whose name or
names the shares so subscribed for are to be issued as specified in such
subscription or mailed to him or them at his or their respective addresses
specified in such subscription, a certificate or certificates for the
appropriate number of shares not exceeding those which the Warrant Holder is
entitled to purchase pursuant to the Warrant surrendered.

4.3

Subscription for Less Than Entitlement

The Holder of any Warrant may subscribe for and purchase a number of shares less
than the number which he is entitled to purchase pursuant to the surrendered
Warrant. In the event of any purchase of a number of shares less than the number
which can be purchased pursuant to a Warrant, the Holder thereof upon exercise
thereof will in addition be entitled to receive a new Warrant in respect of the
balance of the shares which he was entitled to purchase pursuant to the
surrendered Warrant and which were not then purchased.

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

- 4 -

 

 

 

4.4

Warrants for Fractions of Shares

To the extent that the Holder of any Warrant is entitled to receive on the
exercise or partial exercise thereof a fraction of a share, such right may be
exercised in respect of such fraction only in combination with another Warrant
or other Warrants which in the aggregate entitle the Holder to receive a whole
number of such shares.

4.5

Expiration of Warrants

After the expiration of the period within which a Warrant is exercisable, all
rights thereunder will wholly cease and terminate and such Warrant will be void
and of no effect.

4.6

Time of Essence

Time will be of the essence hereof.

4.7

Subscription Price

Each Warrant is exercisable at a price per share (the "Exercise Price") of
US$1.00. One (1) Warrant and the Exercise Price are required to subscribe for
each share during the term of the Warrants.

4.8

Adjustment of Exercise Price

 

(a)

The Exercise Price and the number of shares deliverable upon the exercise of the
Warrants will be subject to adjustment in the event and in the manner following:

 

(i)

If and whenever the shares at any time outstanding are subdivided into a greater
or consolidated into a lesser number of shares the Exercise Price will be
decreased or increased proportionately as the case may be; upon any such
subdivision or consolidation the number of shares deliverable upon the exercise
of the Warrants will be increased or decreased proportionately as the case may
be.

 

(ii)

In case of any capital reorganization or of any reclassification of the capital
of the Company or in the case of the consolidation, merger or amalgamation of
the Company with or into any other Company (hereinafter collectively referred to
as a "Reorganization"), each Warrant will after such Reorganization confer the
right to purchase the number of shares or other securities of the Company (or of
the Company's resulting from such Reorganization) which the Warrant Holder would
have been entitled to upon Reorganization if the Warrant Holder had been a
shareholder at the time of such Reorganization.

In any such case, if necessary, appropriate adjustments will be made in the
application of the provisions of this Article Four relating to the rights and
interest thereafter of the Holders of the Warrants so that the provisions of
this Article Four will be made applicable as nearly as reasonably possible to
any shares or other securities deliverable after the Reorganization on the
exercise of the Warrants.

The subdivision or consolidation of shares at any time outstanding into a
greater or lesser number of shares (whether with or without par value) will not
be deemed to be a Reorganization for the purposes of this clause 4.8(a)(ii).

 

(b)

The adjustments provided for in this Section 4.8 are cumulative and will become
effective immediately after the record date or, if no record date is fixed, the
effective date of the event which results in such adjustments.

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

- 5 -

 

 

 

4.9

Determination of Adjustments

If any questions will at any time arise with respect to the Exercise Price or
any adjustment provided for in Section 4.8, such questions will be conclusively
determined by the Company's Auditors, or, if they decline to so act any other
firm of certified public accountants in the United States of America that the
Company may designate and who will have access to all appropriate records and
such determination will be binding upon the Company and the Holders of the
Warrants.

5.

WAIVER OF CERTAIN RIGHTS

5.1

Immunity of Shareholders, etc.

The Warrant Holder, as part of the consideration for the issue of the Warrants,
waives and will not have any right, cause of action or remedy now or hereafter
existing in any jurisdiction against any past, present or future incorporator,
shareholder, Director or officer (as such) of the Company for the issue of
shares pursuant to any Warrant or on any covenant, agreement, representation or
warranty by the Company herein contained or in the Warrant.

6.

MODIFICATION OF TERMS, ETC.

6.1

Modification of Terms and Conditions for Certain Purposes

From time to time the Company may, subject to the provisions of these presents,
modify the Terms and Conditions hereof, for the purpose of correction or
rectification of any ambiguities, defective provisions, errors or omissions
herein.

6.2

Warrants Not Transferable

The Warrant and all rights attached to it are not transferable.

DATED as of the date first above written in these Terms and Conditions.

UREX ENERGY CORP.

 

 

Per: ________________________

Authorized Signatory

 

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

 

FORM OF SUBSCRIPTION

TO:

Urex Energy Corp.

10580 N. McCarran Blvd.

Building 115-208

Reno, Nevada 89503

USA

The undersigned Holder of the within Warrants hereby subscribes for ____________
common shares (the "Shares") of Urex Energy Corp. (the "Company") pursuant to
the within Warrants at US$1.00 per Share on the terms specified in the said
Warrants. This subscription is accompanied by a certified cheque or bank draft
payable to or to the order of the Company for the whole amount of the purchase
price of the Shares.

The undersigned represents that, at the time of the exercise of these Warrants,
all of the representations and warranties contained in Section 6 of the
Subscription Agreement between the Company and the undersigned pursuant to which
these Warrants were issued are true and accurate.

The undersigned hereby directs that the Shares be registered as follows:

NAME(S) IN FULL

 

ADDRESS(ES)

 

NUMBER OF SHARES

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL:

 

 

(Please print full name in which share certificates are to be issued, stating
whether Mr., Mrs. or Miss is applicable).

DATED this ________ day of __________________ , ______.

In the presence of:

__________________________________________

________________________________________

Signature of Witness

Signature of Warrant Holder

Please print below your name and address in full.

Name (Mr./Mrs./Miss)

__________________________________________________________

Address

__________________________________________________________

 

__________________________________________________________

INSTRUCTIONS FOR SUBSCRIPTION

The signature to the subscription must correspond in every particular with the
name written upon the face of the Warrant without alteration or enlargement or
any change whatever. If there is more than one subscriber, all must sign. In the
case of persons signing by agent or attorney or by personal representative(s),
the authority of such agent, attorney or representative(s) to sign must be
proven to the satisfaction of the Company. If the Warrant certificate and the
form of subscription are being forwarded by mail, registered mail must be
employed.

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

 

EXHIBIT C

INSTRUCTIONS FOR WIRING FUNDS TO CLARK WILSON LLP

 

HSBC BANK USA, NEW YORK

ABA:                                    021 001 088
SWIFT CODE:                 MRMDUS33
ACCOUNT NO.:              000050881

 

For further credit to:

HSBC BANK CANADA

885 WEST GEORGIA STREET

VANCOUVER, BRITISH COLUMBIA

V6C 3G1 CANADA

ACCOUNT NAME:                          CLARK WILSON LLP

U.S. TRUST ACCOUNT NO.:                     491689-002

TRANSIT NO.:                                                 10020

BANK CODE:                                                   16
SWIFT NO.                                                        HKBCCATT

PLEASE ALSO INSTRUCT YOUR BANKER TO QUOTE YOUR NAME

AND OUR FILE NAME 31364-0001/VZH

 

D/VXD/888264.2

 

--------------------------------------------------------------------------------

 

 

EXHIBIT D

SELLING STOCKHOLDER’S QUESTIONNAIRE

Please furnish the following information for use in preparing and verifying the
proposed Registration Statement on Form SB-2 (the "Registration Statement") to
be filed by UREX ENERGY CORP. (the "Company") on your behalf with the Securities
and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "Securities Act"). Please furnish the required information on the enclosed
duplicate of this questionnaire, sign and date this form and return it to the
President at the address set out on page 1 of the Subscription. In addition, you
should notify the Company immediately of any changes in the foregoing answers as
a result of any developments or transactions occurring prior to the effective
date of the Registration Statement.

A.

Date.

 

 

 

 

Fill in date:

 

 

B.

Name.

 

 

 

 

Name or names must
appear exactly as
name or names appear
(or will appear)
on stock certificate.

Please print:

 

C.

Address.

 

Please print:

 

 

 

 

 

 

 

 

 

 

 

 

 

D.

Corporate Ownership.

Please print:

 

 

If the owner of the shares of the
Company’s common stock is a
corporate or other entity, indicate the name of the natural
person who exercises the power
to dispose of such shares

 

 

 

 

 

 

 

 

_________________________

[1] 

You should answer all questions, stating “none” or “not applicable” where
appropriate. If space provided is not adequate for any answer, please continue
your answer on an attached sheet. For the definition of certain terms, please
see the Explanatory Note at the end of this questionnaire.

 

 

--------------------------------------------------------------------------------

 

 

 

E.

Stock Owned.

 

 

1.

Please state the number
of shares of the Company's
common stock beneficially
owned (see Explanatory Note)
by you as of this date:

 

 

2

Please state the number of
shares of the Company's
common stock issuable
upon exercise of any presently
exercisable stock options and
warrants beneficially owned
by you as of this date:

 

 

F.

Stock Offered for Sale.

 

 

 

Please state the number
of shares of the Company's
common stock desired
to be sold pursuant to the
Registration Statement

 

 

F.

Status.

 

 

 

 

The undersigned is not acting in a fiduciary capacity or as a nominee in selling
the shares of the Company's common stock except as indicated below:

 

 

 

 

 

 

 

 

 

 

H.

Relationship with the Company.

 

 

 

Please indicate the nature of any material relationship which you have had
within the past three years with the Company, its predecessors or any of its
affiliates (See Explanatory Note).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

I.

Restrictions on Common Stock.

 

 

 

Except as indicated below, the shares of the Company's common stock offered are
owned free of any restrictions, including, but not limited to, any proxies,
liens, charges, security interests and encumbrances, with full rights and power
to sell, assign, transfer, and deliver the shares.

 

 

 

 

 

 

 

 

 

 

 

 

 

J.

Plan of Distribution.

 

 

1.

Please state whether you are a registered broker dealer or an affiliate of a
registered broker dealer.

 

 

 

 

 

 

 

 

 

 

2.

Please state whether the shares of the Company's common stock to be offered for
your account pursuant to the Registration Statement are to be offered through
underwriters (other than "deemed underwriters" as described in the "Plan of
Distribution" section disclosed below). Note: The Company is not planning to
engage underwriters; we are interested in determining whether you will engage
underwriters for the sale of your shares.

 

 

 

Answer:

Yes: ________

No:

________

 

 

 

[If the answer to question No. 2 is no, please skip to question No. 7.]

 

 

 

 

3.

Please state the principal underwriters and the respective amounts of common
stock to be underwritten.

 

 

 

 

 

 

 

 

 

 

4.

Please state whether the underwriters are or will be committed to take and pay
for all of the shares of the Company's common stock if any are taken, or whether
it is merely an agency or the type of "best efforts" arrangement under which the
underwriters are required to take and to pay for only such securities as they
may sell to the public.

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

5.

Please describe the discounts and commissions to be allowed or paid to the
underwriters, and all other items that would be deemed by the National
Association of Securities Dealers to constitute underwriting compensation

 

 

 

 

 

 

 

 

 

 

6.

Please describe any arrangement whereby any underwriter has the right to
designate or nominate a member or members of the board of directors of the
Company, and please disclose the identity of any director so designated or
nominated, and indicate whether or not such person is a director, officer,
partner, employee or affiliate of the underwriter.

 

 

 

 

 

 

 

 

 

 

7.

Please state whether the shares of the Company's common stock are to be offered
through the selling efforts of brokers or dealers that you have engaged for that
purpose as of the date you complete this questionnaire.

 

 

 

 

 

 

Answer: Yes ________

No _________

 

 

[If the answer to question No. 7 is no, please skip to question No. 11.]

 

 

 

 

8.

Please describe the plan of distribution and the terms of any agreement,
arrangement, or understanding entered into with broker(s) or dealer(s),
including volume limitations on sales, parties to the agreement and conditions
under which the agreement may be terminated. Additionally, please attach a copy
of any such plan of distribution, agreement, arrangement or understanding.

 

 

 

 

 

 

 

 

 

 

9.

Please identify, if known to you, the broker(s) or dealer(s) which will
participate in the offering and state the amount to be offered through each.

 

 

 

 

 

 

 

 

 

 

10.

State the discounts and commissions to be allowed or paid to dealers, including
all cash, securities, contracts or other consideration to be received by any
dealer in connection with the sale of the shares of the Company's common stock
to be registered.

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11.

Please state whether the shares of the Company's common stock to be registered
will be offered for any consideration other than for cash.

 

 

 

 

 

 

Answer: Yes _______

No _______

 

 

[If the answer to question No. 11 is no, please skip to question No. 13.

 

 

 

 

12.

If the answer to question No. 11 is yes, please describe the general purposes of
the distribution, the basis on which the securities are to be offered, the
amount of compensation and other expenses of distribution and by whom such
compensation and expenses are to be borne.

 

 

 

 

 

 

 

 

 

 

13.

Please review the "Plan of Distribution" substantially in the form as attached
as Exhibit A hereto. Do you plan on disposing for your shares of the Company's
common stock in an manner which is not covered by this description?

 

 

 

Answer: Yes _______

No _______

 

 

If yes, please indicate how:

 

 

 

 

 

 

 

 

 

K.

Use of Finders.

 

 

State whether you will be utilizing any finder in connection with the sale of
the shares of the Company's common stock pursuant to the Registration Statement.

 

 

 

Answer: Yes _______

No _______

 

 

 

 

 

If yes, please describe, if applicable, the nature of any material relationship
between such finder and the Company, its officers, directors, principal
underwriter(s), (including where applicable, affiliates and associates thereof).

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

L.

Status of Underwriter.

 

 

The selling stockholder is aware that, in any public offering and sale of the
shares of the Company's common stock to be offered pursuant to the Registration
Statement, such stockholder and any brokers participating in such sales may be
deemed to be underwriters within the meaning of the Securities Act.

The answers to the foregoing questions are correctly stated to the best of the
undersigned’s knowledge, information and belief. The undersigned will promptly
notify you of any change in the foregoing information which occurs prior to the
Effective Date of the Registration Statement.

 

Date: _______________, 2006

 

 

STOCKHOLDER

 

 

Name:

 

Signature:

 

Address:

 

 

 

 

 

Phone #:

 

Fax #:

 

Email:

 

 

 

 

 

 

EXPLANATORY NOTE

"Beneficial Ownership"

In relevant part, Rule 13d-3 under the Securities Exchange Act of 1934 provides
that:

(a)           . . . a beneficial owner of a security includes any person who,
directly or indirectly, through any contract, arrangement, understanding,
relationship, or otherwise has or shares:

(1)           Voting power which includes the power to vote, or to direct the
voting of, such security; and/or

(2)           Investment power which includes the power to dispose, or to direct
the disposition of, such security.

(b)           Any person who, directly or indirectly, creates or uses a trust,
proxy, power of attorney, pooling arrangement or any other contract,
arrangement, or device with the purpose or effect of divesting such person of
beneficial ownership of a security or preventing the vesting of such beneficial
ownership as part of a plan or scheme to evade the reporting requirements of
Section 13(d) or 13(g) of the Act shall be deemed for purposes of such sections
to be the beneficial owner of such security.

(c)           All securities of the same class beneficially owned by a person,
regardless of the form which such beneficial ownership takes, shall be
aggregated in calculating the number of shares beneficially owned by such
person.

(d)           Notwithstanding the provisions of paragraphs (a) and (c) of this
rule:

(1)(i) A person shall be deemed to be the beneficial owner of a security subject
to the provisions of paragraph (b) of this rule, if that person has the right to
acquire beneficial ownership of such security . . . within sixty days, including
but not limited to any right to acquire: (A) through the exercise of any option,
warrant or right; (B) through the conversion of a security; (C) pursuant to the
power to revoke a trust, discretionary account, or similar arrangement; or
(D) pursuant to the automatic termination of a trust, discretionary account or
similar arrangement.

Please note that under Rule 13d-3, the same security may be beneficially owned
by more than one person. For example, if you hold shares as trustee or custodian
for the benefit of your minor child, both you and your child would be deemed the
beneficial owner of such shares. Please furnish sufficient details to
cross-reference such overlapping ownership. If you report ownership of certain
securities and yet expressly disclaim that you in fact own such securities
beneficially, such disclaimer will be noted in the Registration Statement.

"Affiliate"

The SEC defines "affiliate" to mean "a person that directly, or indirectly
through one or more intermediaries, controls or is controlled by, or is under
common control with [a specified person.]" For purposes of this questionnaire,
you should assume that all executive officers, directors and major stockholders
of the Company are included in the definition of "affiliate."

 

 

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