Exhibit
10.1


PURCHASE AND SALE AGREEMENT


THIS
PURCHASE AND SALE AGREEMENT (the “Agreement”)
is entered into as of September    , 2007 by and between
Pure Cycle Corporation, a Delaware corporation (“Pure Cycle”), and                        ,
a                        
(“CAA Holder”).


RECITALS


A.            Pursuant to the Comprehensive Amendment Agreement No. 1,
dated as of April 11, 1996 (the “CAA”),
between Pure Cycle and certain investors (including CAA Holder), Pure Cycle is
obligated to pay such investors certain proceeds it receives from the sale of “Export Water” (as defined in the CAA).


B.            CAA Holder is referenced in Section 2.1(    ),
(    ), and (    ) of the CAA and is
entitled to receive “Gross Proceeds” (as defined in the CAA) totaling
$             ,
$             ,
and $             ,
respectively, under these subsections of the CAA (collectively, the “CAA Holder Gross Proceeds”).


C.            Pure Cycle has offered to purchase from the CAA Holder
all of its rights to receive payments under the CAA at a discount to the face
amount of the CAA Holder Gross Proceeds in consideration of the issuance of
certain shares of the capital stock of Pure Cycle, and CAA Holder has accepted
the offer, on and subject to the terms set forth herein.


AGREEMENT


In
consideration of the mutual promises herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:


1.             Purchase and Sale of CAA Interest.  CAA Seller hereby unconditionally and
irrevocably sells, transfers, assigns and conveys to Pure Cycle, and Pure Cycle
hereby purchases and accepts from CAA Holder, all of its right, title and
interest in and to CAA, including without limitation:  (i) the right of CAA Holder to receive
monies and other property or assets due and to become due to the CAA Holder
pursuant to the CAA (including, without limitation, the CAA Holder Gross
Proceeds) and (ii) all rights of the CAA Holder to compel performance and
otherwise exercise all remedies thereunder (collectively, the “Transferred Interest”).  Pure Cycle hereby assumes all of the
obligations, liabilities, responsibilities and commitments of the CAA Holder
under the CAA.


2.             Purchase Price. 
In consideration of the sale of the Transferred Interests, Pure Cycle
hereby agrees to issue and deliver                       
shares of common stock of Pure Cycle (the “PC Shares”) to CAA Holder.  The PC Shares shall bear the legend
restricting transfer set forth in Section 8 hereof.


3.             Effect of Purchase.  Upon issuance to the CAA Holder of the PC
Shares, all rights of the CAA Holder relating in any way to the CAA will be
owned by Pure Cycle.  Pure Cycle 



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and CAA Holder agree that this Agreement constitutes
an assignment to Pure Cycle of all of the CAA Holder’s rights, title and
interest in and to the CAA as of the date hereof, and that as of the date
hereof the CAA Holder shall cease to possess any rights with respect to the
CAA.


4.             Representations and Warranties
of the CAA Holders.


(a)           Authority.  The CAA Holder represents that it has all
requisite right, power, and authority to execute, deliver and perform its
obligations under this Agreement; this Agreement has been duly and validly
authorized, executed and delivered by the CAA Holder; and this Agreement is the
valid and binding obligation of the CAA Holder, enforceable against it in
accordance with its terms, except as enforceability may be limited by
(i) applicable bankruptcy, insolvency, reorganization, arrangement,
moratorium, fraudulent conveyance, redemption, reinstatement, and other laws
affecting the rights or remedies of creditors generally or (ii) general
principles of equity.


(b)           Ownership.  The Transferred Interest represents the
entire interest of the CAA Holder under the CAA.  The CAA Holder owns the Transferred Interest
and passes to Pure Cycle good and marketable title to the Transferred Interest,
free and clear of any lien, encumbrance, pledge, option, adverse interest,
charge or assessment of any kind (a “Lien”).  The CAA holder represents that it has not
taken any action to sell or otherwise transfer the Transferred Interest, to
mortgage, hypothecate or otherwise encumber the Transferred Interest, or to
grant any Lien on the incidents of ownership of the Transferred Interest,
including any right of first offer or other contractual obligation.


(c)           No Conflicts.  The CAA Holder represents that the execution,
delivery and performance by it of this Agreement does not and will not
(i) conflict with, violate, result in a breach of or constitute a default
under any agreement, instrument or obligation to which such CAA Holder is a
party or by which it is bound; (ii) conflict with or violate any order,
judgment, decree, statute, rule or regulation applicable to the CAA Holder;
(iii) result in the creation or imposition of any Lien against or upon the
Transferred Interest; or (iv) require any consent, approval or
authorization of, or filing with, any governmental authority or any other third
party.


(d)           Investment Representations.  The CAA Holder understands that the valuation
of interests in the CAA and the common stock of Pure Cycle is uncertain and
that such value derives significantly from future transactions and developments
that are largely unknown and unknowable. 
The CAA Holder acknowledges that the consideration being paid hereunder
represents the result of an arms’ length negotiation between Pure Cycle and the
CAA Holder and represents the fair market value of the Transferred
Interest.  The CAA Holder has read and
understands the public filings made by Pure Cycle with the U.S. Securities and
Exchange Commission (the “SEC”).  In addition, the CAA Holder has been given
the opportunity to solicit from Pure Cycle all information relevant to
valuation of rights under the CAA and regarding Pure Cycle’s business and
operations and has received all the information requested.  The CAA Holder has made an investigation of
the pertinent facts related to Pure Cycle, the PC Shares, and the likelihood of
payment under the CAA and has reviewed all information regarding Pure Cycle to
the extent it deems necessary in order to be fully informed with respect
thereto.  The CAA Holder is an “accredited
investor” within the meaning of Rule 501 under the Securities Act of 1933,
as amended (the “Securities Act”),
and is knowledgeable and experienced in securities, 



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financial and business matters and in transactions of
this nature, and has made its own assessment of the value of the PC Shares and
of its rights under the CAA.  The CAA
Holder is capable of evaluating the merits and risks of this transaction and is
able to bear a complete loss of the investment in the PC Shares.  The CAA Holder understands that subsequent
events may prove that values of interests in the CAA were higher or lower than
the valuation indicated by the PC Shares paid hereunder.


(e)           Restricted Stock.  The CAA Holder represents that it has been
advised and understands that the PC Shares have not been registered under the
Securities Act or any state securities laws and that the PC Shares are being
issued in reliance upon exemptions from such registration requirements.  The CAA Holder acknowledges that the PC
Shares are “restricted securities” as that term is defined in Rule 144
promulgated by the SEC under the Securities Act and may not be sold or
transferred by the CAA Holder unless such PC Shares are subsequently registered
under that act and applicable state securities laws or are transferred pursuant
to an exemption from such registration requirements.


5.             Representations and Warranties
of Pure Cycle.


(a)           Authority.  Pure Cycle has all corporate right, power,
and authority to execute, deliver and perform its obligations under this
Agreement.  This Agreement has been duly
and validly authorized, executed and delivered by Pure Cycle.  This Agreement is the valid and binding obligation
of Pure Cycle, enforceable against Pure Cycle in accordance with its terms,
except as enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, arrangement, moratorium, fraudulent conveyance,
redemption, reinstatement, and other laws affecting the rights or remedies of
creditors generally or (ii) general principles of equity.


(b)           No Conflicts.  The execution, delivery and performance by
Pure Cycle of this Agreement does not and will not (i) conflict with,
violate, result in a breach of or constitute a default under any agreement,
instrument or obligation to which Pure Cycle is a party or by which Pure Cycle
is bound; (ii) conflict with or violate any order, judgment, decree,
statute, rule or regulation applicable to Pure Cycle; or (iii) except as
required by Form 8-K under the Securities and Exchange Act of 1934,
require any consent, approval or authorization of, or filing with, any
governmental agency.


(c)           PC Shares.  The PC Shares are duly authorized validly
issued, fully paid and non-assessable.


6.             Release.


(a)           CAA Holder Release.  The CAA Holder, on behalf of itself and its
partners, officers, employees, affiliates, and agents, hereby fully and forever
releases and discharges Pure Cycle and its officers, directors, agents,
employees, affiliates, successors and predecessors from any and all claims,
demands, proceedings, causes of actions, orders, obligations, contracts,
agreements, debts, guarantees, damages, expenses, costs, attorneys’ fees and
liabilities whatsoever, whether known or unknown, suspected or unsuspected,
both at law and in equity, which the CAA Holder now has, has ever had or may
hereafter have against Pure 



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Cycle in connection with, related to or arising out of
(i) the CAA Holder’s interest in the CAA, (ii) the financing
transactions pursuant to which the CAA Holder acquired its interest in the CAA
and (iii) the business, operations, management, financing, or other
matters relating to Pure Cycle, provided that this release shall not apply with
respect to any claims arising out of this Agreement.


(b)           Pure Cycle Release.  Pure Cycle, on behalf of itself and its
officers, directors, employees and agents, hereby fully and forever releases
and discharges the CAA Holder and its partners, officers, agents, employees,
affiliates, successors and predecessors from any and all claims, demands,
proceedings, causes of actions, orders, obligations, contracts, agreements,
debts, guarantees, damages, expenses, costs, attorneys’ fees and liabilities
whatsoever, whether known or unknown, suspected or unsuspected, both at law and
in equity, which Pure Cycle now has, has ever had or may hereafter have against
the CAA Holder in connection with, related to or arising out of (i) the
CAA Holder’s interest in the CAA and (ii) the financing transactions
pursuant to which Pure Cycle entered into the CAA.


7.             Survival. 
Each of the covenants, representations and warranties of the CAA Holder
and Pure Cycle made herein shall survive the delivery of the PC Shares.


8.             Restrictive Legend.  The PC Shares issued hereunder shall bear the
following (or substantially equivalent) legend on the face or reverse side
thereof:


“These
shares have not been registered under the Securities Act of 1933, as amended,
or applicable state securities laws, and may not be sold, transferred or
otherwise disposed of unless the same are registered or unless an exemption
from such registration is available and Pure Cycle Corporation has received
evidence of such exemption satisfactory to it (which may include, among other
things, an option of counsel satisfactory to the corporation).


9.             Entire Agreement; Amendments; Waivers.  This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, with
respect thereto.  This Agreement may not
be modified orally, but only by an agreement in writing signed by the party
against whom any waiver or amendment may be sought to be enforced.  No action taken pursuant to this Agreement
and no investigation by or on behalf of any party hereto shall be deemed to
constitute a waiver by such party of compliance with any representation,
warranty, covenant or agreement herein. 
The waiver by any party hereto of any condition or of a breach of
another provision of this Agreement shall not be construed as a waiver of any
other condition or subsequent breach. 
The waiver by any party of any part of any condition precedent to its
obligations under this Agreement shall not preclude it from seeking redress for
breach of this Agreement other than with respect to the condition waived.


10.           Binding Effect.  This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns.



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11.           Headings and Exhibits.  The section, exhibit and other headings in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement.


12.           Counterparts.  For the convenience of the parties hereto,
this Agreement may be executed in any number of original or facsimile
counterparts, each of which, when executed, shall be deemed to be an original
and all of such counterparts together shall be deemed to be one and the same
Agreement.


13.           Governing Law.  This Agreement shall be construed and
enforced in accordance with the laws of the State of Colorado, without giving
effect to the principles of conflicts of law of such state.


*              *              *


[Signature page
follows]


 



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IN
WITNESS WHEREOF, the parties hereto have executed this Purchase and Sale
Agreement as of the date set forth above.


	
  PURE CYCLE CORPORATION,

  a Delaware corporation

  	
   

  	
  CAA HOLDER

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Mark Harding, President

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


 


 



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