Document:

August 18, 2010
Robert McCann
GulfStar Energy Corp
3410 Embassy Dr
West Palm Beach,
Florida. 33401

         RE:  Private Placement of Securities

Dear Mr. McCann:

         This letter  confirms  our  agreement  that  Gulfstar  Energy  Corp,  a
Colorado  corporation  (collectively with its owned or controlled  subsidiaries,
the  "Company")  has engaged Maxim Group LLC (together  with its  affiliates and
subsidiaries, the "Placement Agent") to act as the Company's exclusive Placement
Agent  in  connection  with  the  Company's   proposed  private  placement  (the
"Offering") of equity,  convertible,  debt and/or equity linked  securities (the
"Securities") of the Company.  The precise terms of the Securities and the gross
proceeds of such Offering will be negotiated between the Placement Agent and the
Company with one or more Investors (as defined below),  it being understood that
the gross proceeds of the Offering will be up to $15 million.

         Upon  acceptance  (indicated  by your  signature  below),  this  letter
agreement (the "Agreement") will confirm the terms of the engagement between the
Placement Agent and the Company on the terms and conditions set forth herein.

1.       Appointment.

         (a) Subject to the terms and conditions of this Agreement,  the Company
hereby  retains the Placement  Agent,  and the Placement  Agent hereby agrees to
act, as the Company's exclusive Placement Agent in connection with the Offering.
As Placement Agent for the Offering,  the Placement Agent will advise and assist
the Company in identifying  one or more investors that are  "accredited"  within
the meaning of the U.S. federal  securities laws ("Investors") to participate in
the Offering.  The Company  acknowledges  and agrees that the Placement Agent is
only required to use its  "commercially  reasonable  efforts" in connection with
its activities  hereunder and that this Agreement does not constitute a legal or
binding  commitment  by the  Placement  Agent  to  purchase  the  Securities  or
introduce  the  Company  to  Investors,  nor does this  Agreement  constitute  a
representation  or warranty on the part of the Placement Agent that any Offering
will be consummated. The Placement Agent will, in its sole discretion, determine
the reasonableness of its efforts,  and is under no obligation to perform at any
level  other than what it deems  reasonable.  The  Company  retains the right to
determine  all of the  terms and  conditions  of the  Offering  and to accept or
reject any  proposals  submitted  to it by the  Placement  Agent in its sole and
absolute discretion.

<PAGE>

         (b) In  furtherance  of the  Company's  agreement  that  the  Placement
Agent's retention hereunder shall be exclusive, during the Term (as such term is
hereinafter  defined),  neither the Company nor any of its officers,  directors,
employees,     subsidiaries,     affiliates,     agents    or    representatives
("Representatives") will, directly or indirectly, solicit or otherwise encourage
the submission of any proposal or offer ("Investment  Proposal") from any person
or entity relating to any issuance of the Company's or any of its  subsidiaries'
equity or equity-linked  securities (including warrants and debt securities with
any equity  feature) or participate in any  discussions  regarding an Investment
Proposal. The term "Investment Proposal" shall not include (i) any investment in
the equity securities of any other entity, and (ii) any transaction or agreement
with one or more persons,  firms or entities designated as a "strategic partner"
of the  Company,  as  determined  in good faith by the Board of Directors of the
Company,  provided  that each such person,  firm or entity is, itself or through
its  subsidiaries,  an  operating  company  in a business  synergistic  with the
business of the Company and in which the Company  receives  benefits in addition
to the  investment of funds,  but shall not include a  transaction  in which the
Company is issuing securities primarily for the purpose of raising capital or to
one or  more  persons  or  entities  whose  primary  business  is  investing  in
securities.  The Company will  immediately  cease all contacts,  discussions and
negotiations  with third parties  regarding any Investment  Proposal and, during
the  Term,  will  promptly  inform  that  Placement  Agent  of  any  unsolicited
Investment   Proposals   received  by  the   Company  or  its   Representatives.
Notwithstanding the foregoing,  the Company and Maxim agree that the Company may
on its own,  prior to the Offering,  raise up to $1.5 million for the purpose of
funding operations of the Company (the "Internal  Financing").  It is understood
and agreed that Maxim  shall not receive the fees  detailed in Section 3 for any
monies raised in connection with the Internal Financing.

2.       Information.

         (a)  The  Company   recognizes   that,  in  completing  its  engagement
hereunder,  the  Placement  Agent  will be using and  relying  on both  publicly
available  information and on data,  material and other  information  (including
non-public  information)  furnished  to  Placement  Agent by the  Company or its
Representatives.  The  Company  will  cooperate  with the  Placement  Agent  and
furnish,  and  cause  to be  furnished,  to the  Placement  Agent,  any  and all
information and data concerning the Company,  its business,  financial condition
and  plans  for the  Offering  that the  Placement  Agent  deems  appropriate  (
including,  without  limitation,  the  Company's  strategic,  business,  growth,
acquisition  and/or  merger  plans and plans for raising  capital or  additional
financing)   that  is  reasonably   requested  by  the   Placement   Agent  (the
"Information"),   including  a  Private  Placement  Memorandum  to  be  used  in
connection  with the Offering,  if deemed  appropriate  by the  Placement  Agent
(collectively,  the "Private Placement Materials").  Any Information and Private
Placement  Materials  forwarded  to  prospective   Investors  will  be  in  form
acceptable  to  Placement  Agent and its  counsel.  The Company  represents  and
warrants that all Information and Private Placement  Materials,  including,  but
not limited to, the Company's financial statements, will be complete and correct
in all material respects and will not contain any untrue statement of a material
fact or omit to state a material fact  necessary in order to make the statements
therein not misleading.

<PAGE>

         (b) It is further  agreed that the  Placement  Agent will conduct a due
diligence  investigation of the Company and the Company will cooperate with such
investigation  as a condition  of the  Placement  Agent's  participation  in the
Offering. The Company recognizes and confirms that the Placement Agent: (i) will
use and rely primarily on the Information,  the Private Placement  Materials and
information available from generally recognized public sources in performing the
services  contemplated by this letter without having independently  verified the
same;  (ii) is authorized as the Placement  Agent to transmit to any prospective
investors  a copy  or  copies  of the  Private  Placement  Materials,  forms  of
subscription  documents  and  any  other  legal  documentation  supplied  to the
Placement Agent for transmission to any prospective investors by or on behalf of
the Company or by any of the Company's  officers,  representatives or agents, in
connection with the performance of the Placement  Agent's services  hereunder or
any transaction  contemplated hereby;  (iii) does not assume  responsibility for
the  accuracy  or  completeness  of the  Information  or the  Private  Placement
Materials and such other  information,  if any provided to the  Investors;  (iv)
will  not  make  an  appraisal  of any  assets  of the  Company  or the  Company
generally; and (v) retains the right to continue to perform due diligence of the
Company,  its business and its officers and  directors  during the course of the
engagement.

         (c) Until the date that is one year from the date hereof, the Placement
Agent will keep all information  obtained from the Company  confidential except:
(i) Information which is otherwise publicly available, or previously known to or
obtained by, the Placement Agent independently of the Company and without breach
of any of the Placement Agent's agreements with the Company;  (ii) the Placement
Agent may disclose  such  information  to its  officers,  directors,  employees,
agents and representatives, and to its other advisors and financial sources on a
need to know basis only and will  ensure  that all such  persons  will keep such
information strictly  confidential.  No such obligation of confidentiality shall
apply to information  that: (i) is in the public domain as of the date hereof or
hereafter enters the public domain without a breach by the Placement Agent, (ii)
was  known  or  became  known by the  Placement  Agent  prior  to the  Company's
disclosure  thereof to the Placement Agent, (iii) becomes known to the Placement
Agent from a source other than the  Company,  and other than by the breach of an
obligation  of  confidentiality  owed to the  Company,  (iv) is disclosed by the
Company  to a  third  party  without  restrictions  on  its  disclosure,  (v) is
independently  developed  by the  Placement  Agent  or  (vi) is  required  to be
disclosed by the Placement Agent or its officers, directors,  employees, agents,
attorneys and to its other advisors and financial sources, pursuant to any order
of a court  of  competent  jurisdiction  or  other  governmental  body or as may
otherwise be required by law.

         (d) The Company  recognizes  that in order for the  Placement  Agent to
perform properly its obligations in a professional manner, the Company will keep
the  Placement  Agent  informed  of and, to the extent  practicable,  permit the
Placement Agent to participate in meetings and  discussions  between the Company
and any  third  party  relating  to the  matters  covered  by the  terms  of the
Placement Agent'  engagement.  If at any time during the course of the Placement
Agent's  engagement,  the Company becomes aware of any material change in any of
the information  previously  furnished to the Placement  Agent, it will promptly
advise the Placement Agent of the change.

         (e)  The Offering shall be conditioned upon, among other things, the
following:

(i)  Satisfactory  completion  by  the  Placement  Agent  of its  due  diligence
investigation and analysis of: (a) the Company's arrangements with its officers,
directors,  employees,  affiliates,  customers  and  suppliers,  (b) the audited
historical  financial statements of the Company, and (c) the Company's projected
financial results for the fiscal years ending December 31, 2010 through 2014;

<PAGE>

(ii)  The  Company  retaining  a  firm  nationally  recognized  in the  U.S.  of
independent  PCAOB  registered  public  accountants  acceptable to the Placement
Agent,  which will have  responsibility  for the  preparation  of the  financial
statements  and the  financial  exhibits,  if any, to be included in the Private
Placement  Materials,  and will  continue to engage  accountants  of  comparable
quality (as may be  determined  by the  Company's  Board of  Directors  or audit
committee)  for a period of at least three (3) years  after the initial  Closing
(as defined below);

(iii) The Company  retaining a transfer  agent for the  Company's  common equity
reasonably  acceptable  to the  Placement  Agent  and  continuing  to  retain  a
competent  transfer  agent for a period of three  (3)  years  after the  initial
Closing;

(iv) Upon the execution of the engagement letter, the Company at its own expense
will conduct  background  checks,  by a background search firm acceptable to the
Placement Agent, for the Company's senior management; and

3.  Compensation.  As  compensation  for  services  rendered  and to be rendered
hereunder by Placement  Agent, the Company agrees to provide the Placement Agent
with the following:

         (a) The Company  agrees to pay the  Placement  Agent a cash fee payable
upon each closing of the Offering  (each,  a "Closing")  equal to eight  percent
(8.0%) of the gross  proceeds  received  by the  Company  at each  Closing  (the
"Placement  Fee").  It is  understood  and agreed,  however,  that if any of the
investors  listed  in  Exhibit  B  ("Company  Investors")  participates  in  the
Offering,  than the fee  payable  upon  Closing  for the amount  invested by the
Company  Investors shall be equal to 2/3rd of the Placement Fee , or 5.3% (2/3rd
*8%). In the event that an  investment is made by Company  Investors in the form
of senior  non-convertible  debt  instrument,  Maxim  fee on any gross  proceeds
invested  by  Company  Investors  shall be equal to 2/3rd of 1%, or 0.6%  (2/3rd
*1%).

         (b) The Company shall, at the Closing, grant to the Placement Agent (or
its  designated   affiliates)  securities  purchase  warrants  (the  "Warrants")
covering a number of the securities ("Securities") equal to eight percent (8.0%)
of the total number of Securities being sold and/or issued in the Offering.  The
Warrants  will be  non-exercisable  for six (6)  months  after  the  date of the
Closing and will be exercisable and expire five (5) years after the Closing. The
Warrants will be  exercisable at a price per share equal to 110% of the price of
the  Securities  paid by the  Investors in  connection  with the  Offering.  The
Warrants shall not be  redeemable.  To the extent that the Investors are granted
registration rights with respect their Securities (or components  thereof),  the
Company will grant  identical  rights to the Placement Agent with respect to the
Securities  underlying  the Warrants.  The  Placement  Agent will be entitled to
customary  demand and  "piggyback"  rights  pursuant  to FINRA Rule 5110.  If so
registered, the Warrants (and the underlying securities) may not be transferred,
assigned or hypothecated  for a period of six (6) months following the Effective
Date pursuant to FINRA Rule 5110(g)(1),  except that they be assigned,  in whole
or in part, to any  successor,  officer or member of the Placement  Agent (or to
officers  or partners of any such  successor  of member)  pursuant to FINRA Rule
5110(g)(2). The Warrants may be exercised in whole or in part, shall provide for
"cashless"  exercise,  and shall provide for customary  anti-dilution  and price
protection.

         (c) The Company shall pay the  Placement  Agent a  non-refundable  cash
retainer  of  $25,000  (the  "Retainer")  payable  upon  the  execution  of this
agreement.  The Retainer shall be paid in US dollars by the Company via check or
wire  transfer of  immediate  available  funds to an account  designated  by the
Placement Agent.

<PAGE>

         (d) In addition to any fees payable to the Placement  Agent  hereunder,
subject to the  provisions  of Section  3(b),  the Company  shall  promptly upon
request from time to time and at each Closing  reimburse the Placement Agent for
all expenses  (including,  without  limitation,  fees and  disbursements  of the
Placement  Agent's  counsel  and all  travel and other  out-of-pocket  expenses)
incurred by the Placement Agent in connection with its engagement hereunder.

         (e) The Company  shall assist and  cooperate  with legal counsel to the
Placement  Agent in  effecting  a filing  with  respect to the  public  offering
contemplated  by the  Registration  Statement to be filed in connection with the
Offering (an "Issuer Filing") with the Financial Industry  Regulatory  Authority
("FINRA")  Corporate  Financing  Department pursuant to FINRA Rule 5110, and the
Company shall pay the filing fee required by such Issuer Filing and the fees and
expenses of counsel to the Placement  Agent in connection with the Issuer Filing
and clearing  such filing with FINRA.  The Company shall assist legal counsel to
the  Placement  Agent in pursuing the Issuer  Filing until FINRA issues a letter
confirming that it does not object to the terms of the Offering  contemplated by
the Registration Statement.

4.       Term of Engagement.

         (a) This Agreement will remain in effect until March 31st,  2011, after
which  either  party  shall have the right to  terminate  it on thirty (30) days
prior written notice to the other.  The date of termination of this Agreement is
referred  to herein from time to time as the  "Termination  Date." The period of
time during  which this  Agreement  remains in effect is referred to herein from
time to time as the "Term". In the event, however in the course of the Placement
Agent's  performance  of due  diligence it deems it  necessary to terminate  the
engagement, the Placement Agent may do so prior to the termination date and upon
immediate  written notice.  If, within twelve months after the Termination Date,
the Company completes any private financing of equity,  equity-linked or debt or
other capital  raising  activity of the Company  (other than the exercise by any
person or entity of any options,  warrants or other convertible securities other
than the warrants  issued  pursuant to this Agreement) with any of the Investors
who were first  introduced  to the  Company  in  connection  with the  financing
contemplated  hereby  by  the  Placement  Agent,  the  Company  will  pay to the
Placement Agent upon the closing of such financing the compensation set forth in
Sections 3(a) and 3(c).

         (b)  Notwithstanding  anything  herein to the contrary,  subject to the
twelve months limitation  described in Section 4(a) above, the obligation to pay
the compensation and expenses described in Section 3, this Section 4, Sections 6
and 8-18  and all of  Exhibit  A  attached,  hereto  (the  terms  of  which  are
incorporated by reference hereto), will survive any termination or expiration of
this Agreement. The termination of this Agreement shall not affect the Company's
obligation to pay fees to the extent  provided for in Section 3 herein and shall
not affect the Company's  obligation to reimburse the expenses accruing prior to
such  termination  to  the  extent  provided  for  herein.  All  such  fees  and
reimbursements  due  shall  be paid to the  Placement  Agent  on or  before  the
Termination Date (in the event such fees and  reimbursements  are earned or owed
as of  the  Termination  Date)  or  upon  the  closing  of the  Offering  or any
applicable portion thereof (in the event such fees are due pursuant to the terms
of Section 3 hereof).

<PAGE>

5.  Certain  Placement  Procedures.  The  Company and the  Placement  Agent each
represents to the other that it has not taken, and the Company and the Placement
Agent each agrees  with the other that it will not take any action,  directly or
indirectly,  so as to cause the Offering to fail to be entitled to rely upon the
exemption  from  registration  afforded by Section 4(2) of the Securities Act of
1933, as amended (the "Act").  In effecting  the  Offering,  the Company and the
Placement  Agent each agrees to comply in all material  respects with applicable
provisions of the Act and any  regulations  thereunder and any applicable  laws,
rules,  regulations and requirements  (including,  without limitation,  all U.S.
state law and all  national,  provincial,  city or other legal  requirements  of
[INSERT  FOREIGN  JURSIDICTION  IF  APPLICABLE]  The  Company  agrees  that  any
representations  and warranties made by it to any Investor in the Offering shall
be deemed also to be made to the  Placement  Agent for its benefit.  The Company
agrees that it shall cause any opinion of its counsel delivered to any Investors
in the Offering also to be addressed and delivered to the Placement Agent, or to
cause such counsel to deliver to the Placement Agent a letter  authorizing it to
rely upon such opinion.

6.  Indemnification.   The  Company  agrees  to  indemnify  Placement  Agent  in
accordance  with  the  indemnification  and  other  provisions  attached  to the
Agreement as Exhibit A (the "Indemnification Provisions"),  which provisions are
incorporated herein by reference and shall survive the termination or expiration
of the Agreement.

7. Other Activities. The Company acknowledges that the Placement Agent has been,
and may in the  future  be,  engaged  to  provide  services  as an  underwriter,
placement agent, finder, advisor and investment banker to other companies in the
industry  in which the  Company  is  involved.  Subject  to the  confidentiality
provisions of the  Placement  Agent  contained in Section 2 hereof,  the Company
acknowledges and agrees that nothing  contained in this Agreement shall limit or
restrict the right of the Placement  Agent or of any member,  manager,  officer,
employee,  agent or  representative  of the  Placement  Agent,  to be a  member,
manager,  partner,  officer,  director,  employee,  agent or representative  of,
investor  in, or to engage in, any other  business,  whether or not of a similar
nature to the  Company's  business,  nor to limit or  restrict  the right of the
Placement Agent to render services of any kind to any other  corporation,  firm,
individual or  association;  provided  that the  Placement  Agent and any of its
member, manager,  officer,  employee,  agent or representative shall not use the
Information to the detriment of the Company.  the Placement Agent may, but shall
not be required to, present opportunities to the Company.

8. Right of First Refusal.  Upon the successful completion of any Closing of the
Offering,  for a period of  eighteen  (18) months  from the final  Closing,  the
Company  grants the  Placement  Agent the right of first  refusal to act as lead
managing  underwriter  and book runner for any and all future public and private
equity and public debt offerings  during such eighteen (18 months) period of the
Company,  or any successor to or any  subsidiary  of the Company (a  "Subsequent
Offering").  Placement  Agent  shall  notify the  Company  within 30 days of its
receipt of the written offer  contemplated  above as to whether or not it agrees
to accept such retention. If Placement Agent should decline such retention,  the
Company  shall  have no  further  obligation  to Maxim,  except as  specifically
provided for herein.

<PAGE>

9. Governing  Law;  Jurisdiction;  Waiver of Jury Trial.  This Agreement will be
governed as to validity,  interpretation,  construction, effect and in all other
respects  by the  internal  law of the State of New York.  The  Company  and the
Placement Agent each (i) agree that any legal suit, action or proceeding arising
out of or relating to this Agreement shall be instituted  exclusively in the New
York State Supreme Court,  County of New York, or in the United States  District
Court for the Southern  District of New York,  (ii) waives any  objection to the
venue of any such suit, action or proceeding,  and the right to assert that such
forum  is  an  inconvenient  forum,  and  (iii)  irrevocably   consents  to  the
jurisdiction  of the New York State Supreme  Court,  County of New York, and the
United States  District Court for the Southern  District of New York in any such
suit, action or proceeding.  Each of the Company and the Placement Agent further
agrees to accept  and  acknowledge  service of any and all  process  that may be
served in any such suit,  action or  proceeding  in the New York  State  Supreme
Court,  County of New  York,  or in the  United  States  District  Court for the
Southern  District of New York and agree that  service of process upon it mailed
by  certified  mail to its address  shall be deemed in every  respect  effective
service of process in any such suit,  action or  proceeding.  The parties hereby
expressly  waive all rights to trial by jury in any suit,  action or  proceeding
arising under this Agreement.

10. Securities and Other Law Compliance.  The Company, at its own expense,  will
use its best  efforts  to obtain any  registration,  qualification  or  approval
required to sell any Securities  under the laws (including U.S. state "blue sky"
laws) of any applicable  jurisdictions  (including  those of the [INSERT FOREIGN
JURISDICTION] or any instrumentality thereof).

11.  Representations  and  Warranties.  The Company and the Placement Agent each
respectively  represent  and  warrant  that:  (a) it has full  right,  power and
authority  to enter into this  Agreement  and to perform all of its  obligations
hereunder;  (b) this  Agreement  has  been  duly  authorized  and  executed  and
constitutes a legal,  valid and binding  agreement of such party  enforceable in
accordance with its terms;  and (c) the execution and delivery of this Agreement
and the consummation of the transactions  contemplated  hereby does not conflict
with or result in a breach of (i) such party's  certificate of  incorporation or
by-laws or (ii) any  agreement to which such party is a party or by which any of
its property or assets is bound.

12. Parties;  Assignment;  Independent Contractor; No Tax Advice. This Agreement
has been and is made  solely  for the  benefit  of the  Placement  Agent and the
Company and each of the persons,  agents,  employees,  officers,  directors  and
controlling  persons  referred  to in  Exhibit  A and  their  respective  heirs,
executors,  personal  representatives,   successors  and  assigns,  and  nothing
contained in this Agreement will confer any rights upon, nor will this Agreement
be  construed  to create  any  rights  in,  any  person who is not party to such
Agreement,  other than as set forth in this section.  The rights and obligations
of either  party  under this  Agreement  may not be  assigned  without the prior
written  consent of the other party  hereto and any other  purported  assignment
will be null and  void.  The  Placement  Agent  has  been  retained  under  this
Agreement as an  independent  contractor,  and it is understood  and agreed that
this  Agreement does not create a fiduciary  relationship  between the Placement
Agent and the Company or their  respective  Boards of  Directors.  The Placement
Agent  shall not be  considered  to be the agent of the  Company for any purpose
whatsoever  and the  Placement  Agent is not granted any right or  authority  to
assume or create  any  obligation  or  liability,  express  or  implied,  on the
Company's behalf, or to bind the Company in any manner  whatsoever.  The Company
acknowledges that the Placement Agent does not provide accounting,  tax or legal
advice.  The  Company is  authorized,  however,  subject to  applicable  law, to
disclose any and all aspects of the Offering  that are  necessary to support any
U.S.  federal  income tax  benefits  expected to be claimed with respect to such
transaction, and all materials of any kind (including tax opinions and other tax
analyses) related to those benefits.

<PAGE>

13. Validity.  In case any term of this Agreement will be held invalid,  illegal
or unenforceable, in whole or in part, the validity of any of the other terms of
this Agreement will not in any way be affected thereby.

14.  Counterparts.  This Agreement may be executed in  counterparts  and each of
such  counterparts  will for all purposes be deemed to be an original,  and such
counterparts will together constitute one and the same instrument.

15. Notices. All notices will be in writing and will be effective when delivered
in person or sent via facsimile and confirmed by letter, to the party to whom it
is addressed at the following  addresses or such other address as such party may
advise the other in writing:

To the Company:   GulfStar Energy Corp.
                           3410 Embassy Dr
                           West Palm Beach,
                           Florida. 33401
                           Attention: Robert McCann
                           Fax No.:

To the Placement Agent      Maxim Group LLC
                            405 Lexington Avenue
                            New York, NY 10174
                            Attention: Clifford A. Teller and James Siegel, Esq.
                            Telephone:  (212) 895-3500
                            Facsimile:  (212) 895-3783 and (212) 895-3860

16. Press Announcements. The Company agrees that the Placement Agent shall, from
and  after  any  Closing,  have the  right to  reference  the  Offering  and the
Placement  Agent's  role  in  connection  therewith  in  the  Placement  Agent's
marketing materials and on its website and to place  advertisements in financial
and other newspapers and journals, in each case at its own expense.

                            (Signature Page Follows)

<PAGE>

         We are  delighted  at the prospect of working with you and look forward
to proceeding  with the Offering.  If you are in agreement  with the  foregoing,
please  execute  and  return  two  copies  of  this  engagement  letter  to  the
undersigned  together with payment for in the amount of $50,000 for the Advance.
This Agreement may be executed in counterparts, electronic mail and by facsimile
transmission.

                                                     Very truly yours,

                                                     Maxim Group LLC

                                                     ---------------------------
                                                     Name:    Karl Brenza
                                                     Title:   Managing Director,
                                                              Investment Banking

                                                     ---------------------------
                                                     Name:    Clifford A. Teller
                                                     Title:   Executive Managing
                                                              Director of
                                                              Investment Banking

Agreed to and accepted this ____ day of ___________, 2010

/s/Robert McCann
-----------------------------
Name: Robert McCann
Title: Chairman & CEO

<PAGE>

                                    Exhibit A

                           INDEMNIFICATION PROVISIONS

         Capitalized terms used in this Exhibit shall have the meanings ascribed
to such terms in the Agreement to which this Exhibit is attached.

         In addition to and without limiting any other right or remedy available
to the Placement Agent and the Indemnified Parties (as hereinafter defined), the
Company  agrees to indemnify and hold harmless  Placement  Agent and each of the
other Indemnified Parties from and against any and all losses, claims,  damages,
obligations,  penalties,  judgments,  awards,  liabilities,  costs, expenses and
disbursements, and any and all actions, suits, proceedings and investigations in
respect   thereof  and  any  and  all  legal  and  other  costs,   expenses  and
disbursements  in giving  testimony  or  furnishing  documents  in response to a
subpoena or otherwise  (including,  without limitation,  the costs, expenses and
disbursements,  as and when incurred,  of investigating,  preparing,  pursing or
defending any such action, suit, proceeding or investigation  (whether or not in
connection  with  litigation  in  which  any  Indemnified  Party  is  a  party))
(collectively,  "Losses"), directly or indirectly, caused by, relating to, based
upon,  arising out of, or in connection with,  Placement  Agent's acting for the
Company,  including,  without limitation, any act or omission by Placement Agent
in connection  with its acceptance of or the performance or  non-performance  of
its obligations  under the Agreement  between the Company and Placement Agent to
which these indemnification  provisions are attached and form a part, any breach
by the Company of any representation,  warranty, covenant or agreement contained
in the Agreement (or in any instrument,  document or agreement relating thereto,
including any agency  agreement),  or the  enforcement by Placement Agent of its
rights under the Agreement or these  indemnification  provisions,  except to the
extent  that  any  such  Losses  are  found  in a final  judgment  by a court of
competent  jurisdiction  (not  subject  to  further  appeal)  to  have  resulted
primarily  and directly from the gross  negligence or willful  misconduct of the
Indemnified Party seeking indemnification hereunder.

         The  Company  also  agrees  that no  Indemnified  Party  shall have any
liability (whether direct or indirect,  in contract or tort or otherwise) to the
Company for or in  connection  with the  engagement  of  Placement  Agent by the
Company or for any other reason, except to the extent that any such liability is
found in a final judgment by a court of competent  jurisdiction  (not subject to
further  appeal) to have resulted  primarily and directly from such  Indemnified
Party's gross negligence or willful misconduct.

         These Indemnification  Provisions shall extend to the following persons
(collectively,  the  "Indemnified  Parties"):  Placement  Agent, its present and
former  affiliated  entities,  managers,  members,  officers,  employees,  legal
counsel,  agents and  controlling  persons  (within  the  meaning of the federal
securities laws), and the officers, directors, partners, stockholders,  members,
managers,  employees,  legal counsel,  agents and controlling  persons of any of
them.  These  indemnification  provisions shall be in addition to any liability,
which the Company may otherwise have to any Indemnified Party.

<PAGE>

         If any action,  suit,  proceeding or investigation is commenced,  as to
which an Indemnified Party proposes to demand  indemnification,  it shall notify
the Company with reasonable promptness;  provided,  however, that any failure by
an  Indemnified  Party to notify the Company  shall not relieve the Company from
its obligations  hereunder.  An Indemnified Party shall have the right to retain
counsel  of its  own  choice  to  represent  it,  and  the  fees,  expenses  and
disbursements  of such counsel  shall be borne by the Company.  Any such counsel
shall,  to  the  extent  consistent  with  its  professional   responsibilities,
cooperate  with the Company  and any  counsel  designated  by the  Company.  The
Company shall be liable for any settlement of any claim against any  Indemnified
Party made with the Company's  written  consent.  The Company shall not, without
the prior written consent of Placement Agent, settle or compromise any claim, or
permit a default  or consent to the entry of any  judgment  in respect  thereof,
unless such settlement,  compromise or consent (i) includes, as an unconditional
term thereof, the giving by the claimant to all of the Indemnified Parties of an
unconditional release from all liability in respect of such claim, and (ii) does
not contain any factual or legal  admission by or with respect to an Indemnified
Party or an adverse  statement with respect to the  character,  professionalism,
expertise or  reputation of any  Indemnified  Party or any action or inaction of
any Indemnified Party.

         In order to provide for just and equitable contribution, if a claim for
indemnification  pursuant to these indemnification  provisions is made but it is
found in a final judgment by a court of competent  jurisdiction  (not subject to
further appeal) that such indemnification may not be enforced in such case, even
though the express  provisions hereof provide for  indemnification in such case,
then the Company shall  contribute to the Losses to which any Indemnified  Party
may be subject (i) in  accordance  with the  relative  benefits  received by the
Company and its stockholders,  subsidiaries and affiliates, on the one hand, and
the  Indemnified  Party,  on the  other  hand,  and  (ii) if (and  only  if) the
allocation  provided  in  clause  (i)  of  this  sentence  is not  permitted  by
applicable law, in such proportion as to reflect not only the relative benefits,
but also the relative fault of the Company, on the one hand, and the Indemnified
Party, on the other hand, in connection  with the statements,  acts or omissions
which resulted in such Losses as well as any relevant equitable  considerations.
No person found liable for a fraudulent  misrepresentation  shall be entitled to
contribution  from  any  person  who is not also  found  liable  for  fraudulent
misrepresentation.   The  relative  benefits  received  (or  anticipated  to  be
received) by the Company and it stockholders,  subsidiaries and affiliates shall
be deemed to be equal to the  aggregate  consideration  payable or receivable by
such parties in connection  with the  transaction or  transactions  to which the
Agreement  relates relative to the amount of fees actually received by Placement
Agent in connection with such transaction or transactions.  Notwithstanding  the
foregoing,  in no event shall the amount contributed by all Indemnified  Parties
exceed the amount of fees previously received by Placement Agent pursuant to the
Agreement.

         Neither  termination nor completion of the Agreement shall affect these
Indemnification  Provisions  which shall remain  operative and in full force and
effect. The Indemnification Provisions shall be binding upon the Company and its
successors and assigns and shall inure to the benefit of the Indemnified Parties
and their respective successors, assigns, heirs and personal representatives.

<PAGE>

                                    Exhibit B

The following companies and their affiliates have been contacted by Gulfstar:

                                      o   JDLK Group, LLC

                                      o   Dribble Dunk, LLC

                                      o   ICO Fund

                                      o   Aberleen Capital

                                      o   Kodiak Capital

                                      o   ICAP Mgt

                                      o   Peninsula Funds

                                      o   Crestview Capital

                                      o   Gas Rock

                                      o   Meridian Capital

                                      o   Kerr Asset Management

                                      o   Remington CapitalEXHIBIT 4.2

 

Exhibit 4.2

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“ACT”).  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.

THIS WARRANT AND THE SHARES PURCHASABLE HEREUNDER ARE SUBJECT TO RESTRICTIONS ON TRANSFER AS SET FORTH HEREIN.

WARRANT TO PURCHASE                                                                                                            SHARES OF COMMON STOCK OF                                                                                                                                3 PEA TECHNOLOGIES, INC.

Void after 

(____________)

Shares of Common Stock

Warrant Number (           )                                                                                                                                   (               )  

This certifies that __________, Tax ID Number _____________ (“Holder”), or assigns, for value received, is entitled to purchase from 3 Pea Technologies, Inc., a Nevada corporation (“Company”), subject to the terms set forth below, that certain number of fully-paid and non-assessable shares of the Company’s common stock (the “Warrant Shares”) of the Company’s Common Stock  for cash at a price of One Dollar Fifty Cents ($1.50) (the “Exercise Price”) per share if exercised prior to the expiration date.  The number of Warrant Shares exercisable under this Warrant is equal to (_____).  The Warrant Shares shall be exercisable at any time or from time to time up to and including 5:00 p.m. (Pacific Time) on __________ such date being referred to herein as the “Expiration Date.”  Holder may exercise the Warrant Shares upon surrender to the Company at its principal office (or at such other location as the Company may advise the Holder in writing) of this Warrant properly endorsed with the Form of Subscription attached hereto duly filled in and signed and upon payment in cash or by wire transfer of the aggregate Exercise Price for the number of shares for which this Warrant is being exercised determined in accordance with the provisions hereof.  The number of Warrant Shares and the Exercise Price are subject to adjustment as provided in Section 3 of this Warrant.

1

EXERCISE, ISSUANCE OF CERTIFICATES, REDUCTION IN NUMBER OF WARRANT SHARES

This Warrant is exercisable at the option of the Holder of record hereof on or prior to the Expiration Date, at any time, for all or any part of the Warrant Shares (but not for a fraction of a share) which may be purchased hereunder, as that number may be adjusted pursuant to Section 3 of this Warrant.  The Company agrees that the Warrant Shares purchased under this Warrant shall be and are deemed to be issued to the Holder hereof as the record owner of such Warrant Shares as of the close of business on the date on which this Warrant shall have been surrendered, properly endorsed, the completed and executed Form of Subscription delivered, and payment made for such Warrant Shares.  Certificates for the Warrant Shares so purchased, together with any other securities or property to which the Holder hereof is entitled upon such exercise, shall be delivered to the Holder hereof by the Company at the Company’s expense not later than thirty (30) days after the rights represented by this Warrant have been so exercised.  In case of a purchase of less than all the Warrant Shares which may be purchased under this Warrant, the Company shall cancel this Warrant and execute and deliver to the Holder hereof within a reasonable time a new Warrant or Warrants of like tenor for the balance of the Warrant Shares purchasable under the Warrant surrendered upon such purchase.  Each stock certificate so delivered shall be registered in the name of such Holder.

SHARES TO BE FULLY PAID

The Company covenants and agrees that all shares of Common Stock issuable upon conversion of such Warrant Shares, will, upon issuance and, if applicable, payment of the applicable Exercise Price, be duly authorized, validly issued, fully paid and nonassessable, and free of all liens and encumbrances, except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES

The Exercise Price and the total number of Warrant Shares shall be subject to adjustment from time to time upon the occurrence of certain events described in this Section 3.

IN THE EVENT OF CHANGES IN THE OUTSTANDING COMMON STOCK OF THE COMPANY BY REASON OF STOCK DIVIDENDS, STOCK SPLITS, RECAPITALIZATIONS, RECLASSIFICATIONS, COMBINATIONS OR EXCHANGES OF SHARES, SEPARATIONS, REORGANIZATIONS, LIQUIDATIONS, OR THE LIKE, THE NUMBER AND CLASS OF SHARES AVAILABLE UNDER THE WARRANT IN THE AGGREGATE AND THE EXERCISE PRICE SHALL BE CORRESPONDINGLY ADJUSTED TO GIVE THE HOLDER OF THE WARRANT, ON EXERCISE FOR THE SAME AGGREGATE EXERCISE PRICE, THE TOTAL NUMBER, CLASS, AND KIND OF SHARES AS THE HOLDER WOULD HAVE OWNED HAD THE WARRANT BEEN EXERCISED PRIOR TO THE EVENT AND HAD THE HOLDER CONTINUED TO HOLD SUCH SHARES UNTIL AFTER THE EVENT REQUIRING ADJUSTMENT.  THE FORM OF THIS WARRANT NEED NOT BE CHANGED BECAUSE OF ANY ADJUSTMENT IN THE NUMBER OF EXERCISE SHARES SUBJECT TO THIS WARRANT.

 

  

2

UPON EACH ADJUSTMENT OF THE EXERCISE PRICE, THE HOLDER OF THIS WARRANT SHALL THEREAFTER BE ENTITLED TO PURCHASE, AT THE EXERCISE PRICE RESULTING FROM SUCH ADJUSTMENT, THE NUMBER OF SHARES OBTAINED BY MULTIPLYING THE EXERCISE PRICE IN EFFECT IMMEDIATELY PRIOR TO SUCH ADJUSTMENT BY THE NUMBER OF SHARES PURCHASABLE PURSUANT HERETO IMMEDIATELY PRIOR TO SUCH ADJUSTMENT, AND DIVIDING THE PRODUCT THEREOF BY THE EXERCISE PRICE RESULTING FROM SUCH ADJUSTMENT.

NOTICE OF ADJUSTMENT

Upon any adjustment of the Exercise Price or any increase or decrease in the number of Warrant Shares, the Company shall give written notice thereof, by first class mail postage prepaid, addressed to the registered Holder of this Warrant at the address of such Holder as shown on the books of the Company.  The notice shall be prepared and signed by the Company’s Chief Financial Officer and shall state the Exercise Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.

NO VOTING OR DIVIDEND RIGHTS

Nothing contained in this Warrant shall be construed as conferring upon the holder hereof the right to vote or to consent to receive notice as a shareholder of the Company on any other matters or any rights whatsoever as a shareholder of the Company.  No dividends or interest shall be payable or accrued in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that, this Warrant shall have been exercised.

COMPLIANCE WITH SECURITIES ACT

The Holder of this Warrant, by acceptance hereof, agrees that this Warrant, the Warrant Shares to be issued upon exercise hereof, and the shares of Common Stock issuable upon conversion of the Warrant Shares are being acquired for investment and that it will not offer, sell, or otherwise dispose of this Warrant, any Warrant Shares, or any shares of Common Stock to be issued upon conversion of the Warrant Shares except under circumstances which will not result in a violation of the Act or any applicable state securities laws.  This Warrant, all Warrant Shares, and all shares of Common Stock issued upon conversion of the Warrant Shares (unless registered under the Act) shall be stamped or imprinted with a legend in substantially the following form:

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES OR BLUE SKY LAWS OF ANY STATE.  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED, OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.

 

  

3

WARRANT TRANSFERABLE

Subject to compliance with applicable federal and state securities laws under which this Warrant was purchased, this Warrant and all rights hereunder are transferable, in whole or in part, without charge to the Holder (except for transfer taxes), upon surrender of this Warrant properly endorsed; provided, however, that the Holder shall notify the Company in writing in advance of any proposed transfer and shall not transfer this Warrant or any rights hereunder to any person or entity which is then engaged in a business that in the reasonable judgment of the Company is in direct competition with the Company.

DISPOSITION OF WARRANT SHARES AND COMMON STOCK

With respect to any offer, sale, or other disposition of the Warrant, any Warrant Shares, or of any shares of Common Stock issued upon conversion of the Warrant Shares prior to registration of such shares, the Holder hereof and each subsequent Holder of this Warrant agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written opinion of such holder’s counsel, if reasonably requested by the Company, to the effect that such offer, sale or other disposition may be effected without registration or qualification (under the Act as then in effect or any federal or state law then in effect) of such Warrant, Warrant Shares or Common Stock, as the case may be, and indicating whether or not under the Act certificates for such Warrant, Warrant Shares or Common Stock to be sold or otherwise disposed of require any restrictive legend as to applicable restrictions on transferability.  Promptly upon receiving such written notice and opinion, the Company, as promptly as practicable, shall notify such Holder that such Holder may sell or otherwise dispose of such Warrant, Warrant Shares or Common Stock, all in accordance with the terms of the notice delivered to the Company.  If a determination has been made pursuant to this subparagraph 8 that the opinion of the counsel for the Holder is not reasonably satisfactory to the Company, the Company shall so notify the Holder promptly after such determination has been made.  Notwithstanding the foregoing, such Warrant, Warrant Shares or Common Stock may be offered, sold or otherwise disposed of in accordance with Rule 144 under the Act, provided that the Company shall have been furnished with such information as the Company may request to provide reasonable assurance that the provisions of Rule 144 have been satisfied.  Each certificate representing the Warrant, Warrant Shares or Common Stock thus transferred (except a transfer pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to insure compliance with the Act, unless in the aforesaid opinion of counsel for the Holder, such legend is not required in order to insure compliance with the Act.  The Company may issue stop transfer instructions to its transfer agent in connection with such restrictions.

MODIFICATION AND WAIVER

This Warrant and any provision hereof may be changed, waived, discharged, or termInated only by an instrument in writing signed by the party against which enforcement of the same is sought.

NOTICES

Any notice, request, or other document required or permitted to be given or delivered to the Holder hereof or the Company shall be delivered or shall be sent by certified mail, postage prepaid, to each such Holder at its address as shown on the books of the Company or to the Company at the address indicated therefore in the first paragraph of this Warrant or such other address as either may from time to time provide to the other.

4

GOVERNING LAW

This Warrant shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the State of Nevada.

LOST WARRANTS

Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation upon surrender and cancellation of such Warrant, the Company, at its expense, will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant.

FRACTIONAL SHARES

No fractional shares shall be issued upon exercise of this Warrant.  The Company shall, in lieu of issuing any fractional share, pay the Holder entitled to such fraction a sum in cash equal to such fraction (calculated to the nearest 1/100th of a share) multiplied by the then effective Exercise Price on the date the Form of Subscription is received by the Company.

NO IMPAIRMENT

The Company will not, by charter amendment or by reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder against impairment.  Upon the request of the Holder, the Company will at any time during the period this Warrant is outstanding acknowledge in writing, in form satisfactory to Holder, the continued validity of this Warrant and the Company’s obligations hereunder.

SUCCESSORS AND ASSIGNS

This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the Holder.  The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant, and shall be enforceable by any such Holder.

EFFECT OF MERGER OR ACQUISITION

Unless this warrant is exercised prior to or simultaneously therewith, if the Company shall at any time merge or otherwise combine with or into or by acquired by another corporation, the holder of this Warrant will thereafter receive, upon the exercise of this Warrant in accordance with its terms, the securities or properties to which the holder of the number of shares of Common Stock then deliverable upon exercise of this Warrant would have been entitled upon such transaction.

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its officer, thereunto duly authorized as of the _____ day of _____ 2006.

5

3 PEA TECHNOLOGIES, INC.

By: _________________________________

Mark R. Newcomer, CEO

 

FORM OF SUBSCRIPTION

Date:_____________________

3 PEA Technologies, Inc.

3068 E. Sunset Road, Suite 3

Las Vegas, NV 89120-2785

Office: (702) 453-2221

To whom it may concern:

The undersigned, the holder of the attached Common Stock Warrant (“Holder”), hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder,(1)                        shares of Common Stock of 3 Pea Technologies, Inc. (“Company”) purchasable thereunder at a price of One Dollar and Fifty Cents, ($1.50) per share (the “Purchase Price”) pursuant to the terms of the Warrant and the undersigned delivers the purchase price herewith in full in cash or wire transfer and herewith makes payment of _______________________Dollars, ($_________) therefore.

Holder represents to the Company that Holder is acquiring such common stock for Holder’s own account for investment and not with a view to or for sale in connection with any distribution thereof.  Holder requests that certificates for such shares be issued in the name of the Holder and delivered to the following address:

Name of Holder:

 ______________________________________________________; 

whose address is:

__________________________________________

__________________________________________

__________________________________________

      Sign Name:__________________________________________ 

Print Name:__________________________________________

 

Footnotes

1 May be exercised in one or more exercisable events.

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}]]