Document:

Registration
      Rights Agreement

     

    This
      Registration Rights Agreement (the “Agreement”)
      is
      made as of the date set forth below between PerfectEnergy International Limited,
      a Nevada corporation (the “Company”),
      and
      the purchasers of its Common Stock (as defined below) pursuant to a Securities
      Purchase Agreement dated as of the date hereof (each an “Investor”
and,
      collectively, the “Investors”).
      Capitalized terms used and not defined herein shall have the respective meanings
      ascribed to them in the Securities Purchase Agreement.

     

    RECITALS

     

    WHEREAS,
      the Company has sold up to [___________] shares (the “Shares”)
      of the
      common stock of the Company, par value $0.001 per share (the “Common
      Stock”),
      and
      warrants (the “Warrants”)
      to
      purchase up to [______________] shares of Common Stock at an exercise price
      of
      $[____] per share (the “Warrant
      Shares,”
and
      together with the Shares, the “Securities”)
      to
      certain investors in a private placement (the “Offering”);
      and

     

    WHEREAS,
      the execution and delivery of this Agreement by the Company is a condition
      to
      the completion of the Offering.

     

    NOW,
      THEREFORE, the parties hereto agree as follows: 

     

    1.  Registration
      Procedures and Expenses.
      The
      Company shall: 

     

    (a)  subject
      to receipt of necessary information from the Investors, use its commercially
      reasonable efforts to cause a Registration Statement on Form S-3, or on such
      other form as is available to the Company (the “Initial Registration
      Statement”),
      to be
      filed with the Securities and Exchange Commission (“SEC”),
      within thirty (30) calendar days following the Closing Date (the “Required
      Filing Date”),
      to
      enable the resale of the Securities by the Investors from time to time.
      Notwithstanding the registration obligations set forth in the first sentence
      of
      this Section
      1(a),
      in the
      event the SEC informs the Company that all of the Securities cannot, as a result
      of the application of Rule 415, be registered for resale as a secondary offering
      on a single registration statement, the Company agrees to promptly (i) inform
      each of the holders thereof, (ii) use its best efforts to file amendments to
      the
      Initial Registration Statement as required by the SEC and/or (iii) withdraw
      the
      Initial Registration Statement and file a new registration statement (a
“New
      Registration Statement,
      and
      together with the Initial Registration Statement, the “Registration
      Statement”),
      in
      either case covering the maximum number of Securities permitted to be registered
      by the SEC on Form S-3 or such other form available to register for resale
      the
      Securities as a secondary offering, with the number of shares included on such
      amendment or the New Registration Statement cut back proportionally for each
      Investor; provided,
      however,
      that
      prior to filing such amendment or New Registration Statement, the Company shall
      be obligated to use its best efforts to advocate with the SEC for the
      registration of all of the Securities in accordance with SEC policies. In the
      event the Company amends the Initial Registration Statement or files a New
      Registration Statement, as the case may be, under clauses (ii) or (iii) above,
      the Company will use its commercially reasonable efforts to file with the SEC,
      as promptly as allowed by the SEC, one or more registration statements on Form
      S-3 or such other form available to register for resale those Securities that
      were not registered for resale on the Initial Registration Statement, as
      amended, or the New Registration Statement; 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    (b)  subject
      to receipt of necessary information from the Investors, use its commercially
      reasonable efforts to cause the Registration Statement to become effective
      no
      later than the date that is 90 calendar days after the Closing Date, (or, in
      the
      event of a “full review” of the Registration Statement by the SEC, one hundred
      fifty (150) calendar days after the Closing Date) (the “Required
      Effective Date”).
      If
      the Registration Statement (i) has not been filed by the Required Filing Date
      or
      (ii) has not been declared effective by the SEC on or before the Required
      Effective Date, the Company shall, on the Business Day immediately following
      the
      Required Filing Date or the Required Effective Date, as the case may be, and
      each 30th
      day
      thereafter, make a payment to the Investor as partial compensation for such
      delay (the “Late
      Registration Payments”)
      equal
      to two percent (2.0%) of the purchase price paid for the Shares purchased by
      the
      Investor and not previously sold by the Investor until the Registration
      Statement is filed or declared effective by the SEC, as the case may be;
      provided, however, that in no event shall the payments made pursuant to this
      paragraph (b), if any, exceed in the aggregate fifteen percent (15.0%) of such
      purchase price. Late Registration Payments will be prorated on a daily basis
      during each 30 day period and will be paid to the Investor by wire transfer
      or
      check within five Business Days after the earlier of (i) the end of each
      thirty day period following the Required Effective Date or (ii) the
      effective date of the Registration Statement; 

     

    (c)  subject
      to a Suspension (as defined in Section 2(c)) being in effect, use its
      commercially reasonable efforts to prepare and file with the SEC such amendments
      and supplements to the Registration Statement and the related prospectus (the
      “Prospectus”)
      as may
      be necessary to keep the Registration Statement current and effective for a
      period ending on the earlier of (i) the second anniversary of the Closing Date,
      (ii) the date on which the Investor may sell Securities pursuant to paragraph
      (k) of Rule 144 under the Securities Act or any successor rule (“Rule
      144”)
      or
      (iii) such time as all Securities purchased by such Investor in this Offering
      have been sold (A) pursuant to a registration statement, (B) to or through
      a
      broker, dealer or underwriter in a public distribution or a public securities
      transaction and/or (C) in a transaction exempt from the registration and
      prospectus delivery requirements of the Securities Act under Section 4(1)
      thereof so that all transfer restrictions and restrictive legends with respect
      thereto, if any, are removed upon the consummation of such sale, and to notify
      each Investor promptly upon the Registration Statement and each post-effective
      amendment thereto, being declared effective by the SEC; 

     

    (d)  furnish
      to the Investor such number of copies of the Registration Statement and
      the
      Prospectus (including
      supplemental prospectuses) (collectively, the “Prospectuses”)
      as the
      Investor may reasonably request, in order to facilitate the public sale or
      other
      disposition of all or any of the Securities by the Investor; 

     

    (e)  file
      documents required of the Company for customary blue sky clearance in states
      specified in writing by the Investor; provided, however, that the Company shall
      not be required to qualify to do business or consent to service of process
      in
      any jurisdiction in which it is not now so qualified or has not so consented;
      

     

    (f)  bear
      all
      expenses (other than underwriting discounts and commissions, if any) in
      connection with the procedures in paragraph (a) through (e) of this Section
      1
      and the registration of the Securities pursuant to the Registration Statement;
      

     

    (g)  advise
      the Investors, promptly after it shall receive notice or obtain knowledge of
      the
      issuance of any stop order by the SEC delaying or suspending the effectiveness
      of the Registration Statement or of the initiation of any proceeding for that
      purpose; and it will promptly use its commercially reasonable efforts to prevent
      the issuance of any stop order or to obtain its withdrawal at the earliest
      possible moment if such stop order should be issued; and

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

     

    (h)  with
      a
      view to making available to the Investor the benefits of Rule 144 and any other
      rule or regulation of the SEC that may at any time permit the Investor to sell
      Securities to the public without registration, the Company covenants and agrees
      to use its commercially reasonable efforts to: (i) make and keep public
      information available, as those terms are understood and defined in Rule 144,
      until the earlier of (A) such date as all of the Investor’s Securities may be
      resold pursuant to Rule 144(k) or any other rule of similar effect or (B) such
      date as all of the Investor’s Securities shall have been resold; (ii) file with
      the SEC in a timely manner all reports and other documents required of the
      Company under the Securities Act and under the Securities Exchange Act of 1934,
      as amended (the “Exchange
      Act”);
      and
      (iii) furnish to the Investor upon request, as long as the Investor owns any
      Securities, (A) a written statement by the Company that it has complied with
      the
      reporting requirements of the Securities Act and the Exchange Act, (B) a copy
      of
      the Company’s most recent Annual Report on Form 10-KSB or Quarterly Report on
      Form 10-QSB, and (C) such other information as may be reasonably requested
      in
      order to avail the Investor of any rule or regulation of the SEC that permits
      the selling of any such Securities without registration.

     

    It
      shall
      be a condition precedent to the obligations of the Company to take any action
      pursuant to this Section 1 that the Investor shall furnish to the Company such
      information regarding itself, the Securities to be sold by the Investor, and
      the
      intended method of disposition of such securities as shall be required to effect
      the registration of the Securities.

     

    The
      Company understands that the Investor disclaims being an underwriter, but
      acknowledges that a determination by the SEC that the Investor is deemed an
      underwriter shall not relieve the Company of any obligations it has
      hereunder.

     

    2.  Transfer
      of Shares After Registration; Suspension. 

     

    (a)  The
      Investor agrees that it will not effect any disposition of the Securities or
      its
      right to purchase the Securities that would constitute a sale within the meaning
      of the Securities Act other than transactions exempt from the registration
      requirements of the Securities Act, as contemplated in the Registration
      Statement and as described below, and that it will promptly notify the Company
      of any material changes in the information set forth in the Registration
      Statement regarding the Investor or its plan of distribution. 

     

    (b)  Except
      in
      the event that paragraph (c) below applies, the Company shall: (i) if deemed
      necessary by the Company, prepare and file from time to time with the SEC a
      post-effective amendment to the Registration Statement or a supplement to the
      related Prospectus or a supplement or amendment to any document incorporated
      therein by reference or file any other required document so that such
      Registration Statement will not contain an untrue statement of a material fact
      or omit to state a material fact required to be stated therein or necessary
      to
      make the statements therein not misleading, and so that, as thereafter delivered
      to purchasers of the Securities being sold thereunder, such Prospectus will
      not
      contain an untrue statement of a material fact or omit to state a material
      fact
      required to be stated therein or necessary to make the statements therein,
      in
      light of the circumstances under which they were made, not misleading; (ii)
      provide the Investor copies of any documents filed pursuant to Section 2(b)(i);
      and (iii) upon request, inform each Investor who so requests that the Company
      has complied with its obligations in Section 2(b)(i) (or that, if the Company
      has filed a post-effective amendment to the Registration Statement which has
      not
      yet been declared effective, the Company will notify the Investor to that
      effect, will use its commercially reasonable efforts to secure the effectiveness
      of such post-effective amendment as promptly as possible and will promptly
      notify the Investor pursuant to Section 2(b)(i) hereof when the amendment has
      become effective).

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

     

    (c)  Subject
      to paragraph (d) below, in the event: (i) of any request by the SEC or any
      other
      federal or state governmental authority during the period of effectiveness
      of
      the Registration Statement for amendments or supplements to the Registration
      Statement or related Prospectus or for additional information; (ii) of the
      issuance by the SEC or any other federal or state governmental authority of
      any
      stop order suspending the effectiveness of the Registration Statement or the
      initiation of any proceedings for that purpose; (iii) of the receipt by the
      Company of any notification with respect to the suspension of the qualification
      or exemption from qualification of any of the Securities for sale in any
      jurisdiction or the initiation of any proceeding for such purpose; or (iv)
      of
      any event or circumstance which necessitates the making of any changes in the
      Registration Statement or Prospectus, or any document incorporated or deemed
      to
      be incorporated therein by reference, so that, in the case of the Registration
      Statement, it will not contain any untrue statement of a material fact or omit
      to state a material fact required to be stated therein or necessary to make
      the
      statements therein not misleading, and that in the case of the Prospectus,
      it
      will not contain any untrue statement of a material fact or omit to state a
      material fact required to be stated therein or necessary to make the statements
      therein, in the light of the circumstances under which they were made, not
      misleading; then the Company shall promptly deliver a certificate in writing
      to
      the Investor (the “Suspension
      Notice”)
      to the
      effect of the foregoing and, upon receipt of such Suspension Notice, the
      Investor will refrain from selling any Securities pursuant to the Registration
      Statement (a “Suspension”)
      until
      the Investors are advised in writing by the Company that the current Prospectus
      may be used, and has received copies of any additional or supplemental filings
      that are incorporated or deemed incorporated by reference in any such
      Prospectus. In the event of any Suspension, the Company will use its
      commercially reasonable efforts to cause the use of the Prospectus so suspended
      to be resumed as soon as reasonably practicable after delivery of a Suspension
      Notice to the Investors. In addition to and without limiting any other remedies
      (including, without limitation, at law or at equity) available to the Investor,
      the Investor shall be entitled to specific performance in the event that the
      Company fails to comply with the provisions of this Section 2(c). The Investor
      covenants that from the date hereof it will maintain in confidence the receipt
      and content of any Suspension Notice provided in accordance with this paragraph
      (c) in accordance with and subject to Section 4.6 of Annex I to the Securities
      Purchase Agreement.

     

    (d)  Notwithstanding
      the foregoing paragraphs of this Section 2, the Company shall use its
      commercially reasonable efforts to ensure that (i) a Suspension shall not exceed
      sixty (60) days individually and (ii) no more than two (2) Suspensions shall
      occur during any twelve month period (each Suspension that satisfies the
      foregoing criteria being referred to herein as a “Qualifying
      Suspension”).
      In
      the event that there occurs a Suspension (or part thereof) that does not
      constitute a Qualifying Suspension, the Company shall pay to the Investor,
      on
      the sixtieth (60th)
      day
      following the first day of such Suspension (or the first day of such part),
      and
      on each sixtieth (60th)
      day
      thereafter, an amount equal to 2.0% of the purchase price paid for the Shares
      purchased by the Investor and not previously sold by the Investor (prorated
      in
      each such case for partial thirty day periods); provided, however, that in
      no
      event shall the payments made pursuant to this paragraph (d), if any, exceed
      in
      the aggregate 15.0% of such purchase price. This liquidated damage shall not
      apply after the Company is no longer obligated to maintain the effectiveness
      of
      the Registration Statement.

     

    (e)  If
      a
      Suspension is not then in effect, the Investor may sell Securities under the
      Registration Statement, provided that it complies with any applicable prospectus
      delivery requirements. Upon receipt of a request therefor, the Company will
      provide an adequate number of current Prospectuses to the Investor and to any
      other parties requiring such Prospectuses. 

     

    (f)  In
      the
      event of a sale of Securities by the Investor, unless such requirement is waived
      by the Company in writing, the Investor must also deliver to the Company’s
      transfer agent, with a copy to the Company, a Certificate of Subsequent Sale
      substantially in the form attached hereto as Exhibit
      A,
      so that
      the Securities may be properly transferred. 

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

     

    (g)  The
      Company agrees that it shall, immediately prior to the Registration Statement
      being declared effective, deliver to its transfer agent an opinion letter of
      counsel, opining that at any time the Registration Statement is effective,
      the
      transfer agent shall issue, in connection with the sale of the Securities,
      certificates representing such Securities without restrictive legend, provided
      the Securities are to be sold pursuant to the Prospectus contained in the
      Registration Statement and the transfer agent receives a Certificate of
      Subsequent Sale in the form attached hereto as Exhibit
      A.
      Upon
      receipt of such opinion, the Company shall cause the transfer agent to confirm,
      for the benefit of the Investor, that no further opinion of counsel is required
      at the time of transfer in order to issue such Securities without restrictive
      legend.

     

    The
      Company shall cause
      its
      transfer agent to issue
      a
      certificate without any restrictive legend to a purchaser of any Securities
      from
      the Investor, if (a) the sale of such Securities is registered under the
      Registration Statement (including registration pursuant to Rule 415 under the
      Securities Act) and the Investor has delivered a Certificate of Subsequent
      Sale
      to the Transfer Agent; (b) the holder has provided the Company with an opinion
      of counsel, in form, substance and scope customary for opinions of counsel
      in
      comparable transactions, to the effect that a public sale or transfer of such
      Securities may be made without registration under the Securities Act; or (c)
      such Securities are sold in compliance with Rule 144 under the Securities Act.
      In addition, the Company shall, at the request of the Investor, remove the
      restrictive legend from any Securities held by the Investor following the
      expiration of the holding period required by Rule 144(k) under the Securities
      Act (or any successor rule). 

    

    3.  Indemnification.
      For
      the
      purpose of this Section 3:

     

    (a)  the
      term
“Selling
      Shareholder”
shall
      mean the Investor and each person, if any, who controls the Investor within
      the
      meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act;
      

     

    (b)  the
      term
“Registration
      Statement”
shall
      include any final Prospectus, exhibit, supplement or amendment included in
      or
      relating to, and any document incorporated by reference in, the Registration
      Statement (or deemed to be a part thereof) referred to in Section 1; and

     

    (c)  the
      term
“untrue
      statement”
shall
      mean any untrue statement or alleged untrue statement, or any omission or
      alleged omission to state in the Registration Statement a material fact required
      to be stated therein or necessary to make the statements therein, not
      misleading.

     

    (d)  (i)The
      Company agrees to indemnify and hold harmless each Selling Shareholder from
      and
      against any losses, claims, damages or liabilities to which such Selling
      Shareholder may become subject (under the Securities Act or otherwise) insofar
      as such losses, claims, damages or liabilities (or actions or proceedings in
      respect thereof) arise out of, or are based upon (i) any untrue statement of
      a
      material fact contained in the Registration Statement, (ii) any inaccuracy
      in
      the representations and warranties of the Company contained in the Agreement
      or
      the failure of the Company to perform its obligations hereunder or (iii) any
      failure by the Company to fulfill any undertaking included in the Registration
      Statement, and the Company will reimburse such Selling Shareholder for any
      reasonable legal expense or other actual accountable out of pocket expenses
      reasonably incurred in investigating, defending or preparing to defend any
      such
      action, proceeding or claim; provided, however, that the Company shall not
      be
      liable in any such case to the extent that such loss, claim, damage or liability
      arises out of, or is based upon, an untrue statement made in such Registration
      Statement in reliance upon and in conformity with written information furnished
      to the Company by or on behalf of such Selling Shareholder specifically for
      use
      in preparation of the Registration Statement, or any inaccuracy in
      representations made by such Selling Shareholder in the Investor Questionnaire
      or the failure of such Selling Shareholder to comply with its covenants and
      agreements contained in Section 4 of Annex I to the Securities Purchase
      Agreement or Section 2 hereof or any statement or omission in any Prospectus
      that is corrected in any subsequent Prospectus that was delivered to the Selling
      Shareholder prior to the pertinent sale or sales by the Selling
      Shareholder.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

     

    (ii)  The
      Investor agrees to indemnify and hold harmless the Company (and each person,
      if
      any, who controls the Company within the meaning of Section 15 of the Securities
      Act, each officer of the Company who signs the Registration Statement and each
      director of the Company) from and against any losses, claims, damages or
      liabilities to which the Company (or any such officer, director or controlling
      person) may become subject (under the Securities Act or otherwise), insofar
      as
      such losses, claims, damages or liabilities (or actions or proceedings in
      respect thereof) arise out of, or are based upon, (i) any failure to comply
      with
      the covenants and agreements contained in Section 4 of Annex I to the Securities
      Purchase Agreement or Section 2 hereof, or (ii) any untrue statement of a
      material fact contained in the Registration Statement if, and only if, such
      untrue statement was made in reliance upon and in conformity with written
      information furnished by or on behalf of the Investor specifically for use
      in
      preparation of the Registration Statement, and the Investor will reimburse
      the
      Company (or such officer, director or controlling person), as the case may
      be,
      for any reasonable legal expense or other actual accountable out-of-pocket
      expenses reasonably incurred in investigating, defending or preparing to defend
      any such action, proceeding or claim. The obligation to indemnify shall be
      limited to the net amount of the proceeds received by the Investor from the
      sale
      of the Securities pursuant to the Registration Statement.

     

    (iii)  Promptly
      after receipt by any indemnified person of a notice of a claim or the beginning
      of any action in respect of which indemnity is to be sought against an
      indemnifying person pursuant to this Section 3, such indemnified person shall
      notify the indemnifying person in writing of such claim or of the commencement
      of such action, but the omission to so notify the indemnifying party will not
      relieve it from any liability which it may have to any indemnified party under
      this Section 3 (except to the extent that such omission materially and adversely
      affects the indemnifying party’s ability to defend such action) or from any
      liability otherwise than under this Section 3. Subject to the provisions
      hereinafter stated, in case any such action shall be brought against an
      indemnified person, the indemnifying person shall be entitled to participate
      therein, and, to the extent that it shall elect by written notice delivered
      to
      the indemnified party promptly after receiving the aforesaid notice from such
      indemnified party, shall be entitled to assume the defense thereof, with counsel
      reasonably satisfactory to such indemnified person. After notice from the
      indemnifying person to such indemnified person of its election to assume the
      defense thereof (unless it has failed to assume the defense thereof and appoint
      counsel reasonably satisfactory to the indemnified party), such indemnifying
      person shall not be liable to such indemnified person for any legal expenses
      subsequently incurred by such indemnified person in connection with the defense
      thereof; provided, however, that if there exists or shall exist a conflict
      of
      interest that would make it inappropriate, in the reasonable opinion of counsel
      to the indemnified person, for the same counsel to represent both the
      indemnified person and such indemnifying person or any affiliate or associate
      thereof, the indemnified person shall be entitled to retain its own counsel
      at
      the expense of such indemnifying person; provided, however, that no indemnifying
      person shall be responsible for the fees and expenses of more than one separate
      counsel (together with appropriate local counsel) for all indemnified parties.
      In no event shall any indemnifying person be liable in respect of any amounts
      paid in settlement of any action unless the indemnifying person shall have
      approved the terms of such settlement; provided that such consent shall not
      be
      unreasonably withheld. No indemnifying person shall, without the prior written
      consent of the indemnified person, effect any settlement of any pending or
      threatened proceeding in respect of which any indemnified person is or could
      reasonably have been a party and indemnification could have been sought
      hereunder by such indemnified person, unless such settlement includes an
      unconditional release of such indemnified person from all liability on claims
      that are the subject matter of such proceeding.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

     

    (iv)  If
      the
      indemnification provided for in this Section 3 is unavailable to or insufficient
      to hold harmless an indemnified party under paragraphs 3(d)(i) or 3(d)(ii)
      above
      in respect of any losses, claims, damages or liabilities (or actions or
      proceedings in respect thereof) referred to therein, then each indemnifying
      party shall contribute to the amount paid or payable by such indemnified party
      as a result of such losses, claims, damages or liabilities (or actions in
      respect thereof) in such proportion as is appropriate to reflect the relative
      fault of the Company on the one hand and the Investor on the other in connection
      with the statements or omissions or other matters which resulted in such losses,
      claims, damages or liabilities (or actions in respect thereof), as well as
      any
      other relevant equitable considerations. The relative fault shall be determined
      by reference to, among other things, in the case of an untrue statement, whether
      the untrue statement relates to information supplied by the Company on the
      one
      hand or the Investor on the other and the parties’ relative intent, knowledge,
      access to information and opportunity to correct or prevent such untrue
      statement. The Company and the Investor agree that it would not be just and
      equitable if contribution pursuant to this subsection (d) were determined by
      pro
      rata allocation (even if the Investors were treated as one entity for such
      purpose) or by any other method of allocation which does not take into account
      the equitable considerations referred to above in this subsection (d). The
      amount paid or payable by an indemnified party as a result of the losses,
      claims, damages or liabilities (or actions in respect thereof) referred to
      above
      in this subsection (d) shall be deemed to include any legal or other expenses
      reasonably incurred by such indemnified party in connection with investigating
      or defending any such action or claim. Notwithstanding the provisions of this
      subsection (d), the Investor shall not be required to contribute any amount
      in
      excess of the amount by which the gross amount received by the Investor from
      the
      sale of the Securities to which such loss relates exceeds the amount of any
      damages which the Investor has otherwise been required to pay by reason of
      such
      untrue statement. No person guilty of fraudulent misrepresentation (within
      the
      meaning of Section 11(f) of the Securities Act) shall be entitled to
      contribution from any person who was not guilty of such fraudulent
      misrepresentation. The Investors’ obligations in this subsection to contribute
      are several in proportion to their sales of Securities to which such loss
      relates and not joint.

     

    The
      parties to this Agreement hereby acknowledge that they are sophisticated
      business persons who were represented by counsel during the negotiations
      regarding the provisions hereof including, without limitation, the provisions
      of
      this Section 3, and are fully informed regarding said provisions. They further
      acknowledge that the provisions of this Section 3 fairly allocate the risks
      in
      light of the ability of the parties to investigate the Company and its business
      in order to assure that adequate disclosure is made in the Registration
      Statement as required by the Securities Act and the Exchange Act.

     

    4.  Termination
      of Conditions and Obligations. The
      conditions precedent imposed by Section 4 of Annex I to the Securities Purchase
      Agreement or this Agreement upon the transferability of the Securities shall
      cease and terminate as to any particular number of the Securities when such
      Securities shall have been effectively registered under the Securities Act
      and
      sold or otherwise disposed of in accordance with the intended method of
      disposition set forth in the Registration Statement covering such Securities
      or
      at such time as an opinion of counsel satisfactory to the Company shall have
      been rendered to the effect that such conditions are not necessary in order
      to
      comply with the Securities Act. 

     

    5.  Information
      Available. So
      long
      as the Registration Statement is effective covering the resale of Securities
      owned by the Investor, the Company will furnish (or, to the extent such
      information is available electronically through the Company’s filings with the
      SEC, the Company will make available) to the Investor: 

     

    (a)  as
      soon
      as practicable after it is available, one copy of (i) its most recent Annual
      Report to Shareholders (which Annual Report shall contain financial statements
      audited in accordance with generally accepted accounting principles by an
      independent registered public accounting firm, and (ii) if not included in
      substance in the Annual Report to Shareholders, its most recent Annual Report
      on
      Form 10-K (the foregoing, in each case, excluding exhibits); 

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

     

    (b)  upon
      the
      reasonable request of the Investor, all exhibits excluded by the parenthetical
      to subsection (a)(ii) of this Section 5 as filed with the SEC and all other
      information that is made available to shareholders; and 

     

    (c)  upon
      the
      reasonable request of the Investor, an adequate number of copies of the
      Prospectuses to supply to any other party requiring such Prospectuses; and
      the
      Company, upon the reasonable request of the Investor, will meet with the
      Investor or a representative thereof at the Company’s headquarters during the
      Company’s normal business hours to discuss all information relevant for
      disclosure in the Registration Statement covering the Securities and will
      otherwise reasonably cooperate with the Investor conducting an investigation
      for
      the purpose of reducing or eliminating the Investor’s exposure to liability
      under the Securities Act, including the reasonable production of information
      at
      the Company’s headquarters; provided, that the Company shall not be required to
      disclose any confidential information to or meet at its headquarters with the
      Investor until and unless the Investor shall have entered into a confidentiality
      agreement, in form and substance reasonably satisfactory to the Company, with
      the Company with respect thereto.

     

    6.  Limits
      on Additional Issuances.
      Except
      for the issuance of stock options, restricted stock and stock appreciation
      rights under the Company’s long term incentive plans, the
      issuance of Common Stock purchase warrants, or the issuance of Common Stock
      upon
      the conversion of preferred stock or upon
      exercise of outstanding options, warrants and other equity-based rights and
      the
      offering contemplated hereby, the Company will not, for a period of six (6)
      months following the Closing Date, offer for sale or sell any securities unless,
      in the opinion of the Company’s counsel, such offer or sale does not jeopardize
      the availability of exemptions from the registration and qualification
      requirements under applicable securities laws with respect to the Offering.
      The
      foregoing shall not apply to securities issued in connection with any
      acquisition, including by way of merger, or purchase of stock or all or
      substantially all of the assets of any third party. Except for the issuance
      of
      stock options, restricted stock and stock appreciation rights under the
      Company’s long term incentive plans,
      the
      issuance of Common Stock purchase warrants, or the issuance of Common Stock
      upon
      the conversion of preferred stock or upon
      exercise of outstanding options, warrants and other equity-based rights and
      the
      offering contemplated hereby, the Company has not engaged in any such offering
      during the six (6) months prior to the date of this agreement. 
      The
      foregoing provisions shall not prevent the Company from filing a “shelf”
registration statement pursuant to Rule 415 under the Securities Act, but the
      foregoing provisions shall apply to any sale of securities
      thereunder.

     

    7.  Notices.
      All
      notices, requests, consents and other communications hereunder shall be in
      writing, shall be delivered (A) if within the United States, by first-class
      registered or certified airmail, or nationally recognized overnight express
      courier, postage prepaid, or by facsimile, or (B) if from outside the United
      States, by International Federal Express (or comparable service) or facsimile,
      and shall be deemed given (i) if delivered by first-class registered or
      certified mail domestic, upon the Business Day received, (ii) if delivered
      by
      nationally recognized overnight carrier, one (1) Business Day after timely
      delivery to such carrier, (iii) if delivered by International Federal Express
      (or comparable service), two (2) Business Days after timely delivery to such
      carrier, (iv) if delivered by facsimile, upon electric confirmation of receipt
      and shall be addressed as follows, or to such other address or addresses as
      may
      have been furnished in writing by a party to another party pursuant to this
      paragraph: 

     

    (a)  if
      to the
      Company, to:

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    

     

    PerfectEnergy
      International Limited

    7401
      Springbank Blvd., Suite 3

    Calgary,
      Alberta T3H 5R2

    Attention:
      [____________]

    Telephone: 
      [____________]

    

    with
      a
      copy to: 

    

    [__________________]

    [__________________]

    [__________________]

    Attention:
      [__________]

    Telephone: [_________]

    

    (b)  if
      to the
      Investor, at its address on the signature page to the Securities Purchase
      Agreement.

     

    8.  Amendments;
      Waiver. This
      Agreement may not be modified or amended except pursuant to an instrument in
      writing signed by the Company and the Investor. Any waiver of a provision of
      this Agreement must be in writing and executed by the party against whom
      enforcement of such waiver is sought.

     

    9.  Headings.
      The
      headings of the various sections of this Agreement have been inserted for
      convenience of reference only and shall not be deemed to be part of this
      Agreement. 

     

    10.  Entire
      Agreement; Severability. This
      Agreement sets forth the entire agreement and understanding of the parties
      relating to the subject matter hereof and supersedes all prior and
      contemporaneous agreements, negotiations and understandings between the parties,
      both oral and written relating to the subject matter hereof. If any provision
      contained in this Agreement is determined to be invalid, illegal or
      unenforceable in any respect, the validity, legality and enforceability of
      the
      remaining provisions contained herein shall not in any way be affected or
      impaired thereby. 

     

    11.  Governing
      Law. This
      Agreement shall be governed by, and construed in accordance with, the internal
      laws of the State of [New
      York],
      without
      giving effect to the principles of conflicts of law. 

     

    12.  Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      constitute an original, but all of which, when taken together, shall constitute
      but one instrument, and shall become effective when one or more counterparts
      have been signed by each party hereto and delivered to the other
      parties.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    Please
      confirm that the foregoing correctly sets forth the agreement between us by
      signing in the space provided below for that purpose.

     

    
      	 	
              Dated
                as of:
                ______________, 2007

            
	 	 	 
	 	
            
	 	
              [Investor
                Name]

            
	 	 	 
	 	
              By:

            	 
	 	
              Name:

            
	 	
              Title:

            
	 	 	 
	 	 	 
	 	
              Address:

            	 
	 	 
	 	 

    

    AGREED
      AND ACCEPTED:

    

    PERFECTENERGY
      INTERNATIONAL LIMITED

     

    

    
      	By:	 	 
	 	Name:	 
	 	Title:	 

    

     

     

    

    

    

    [REGISTRATION
      RIGHTS AGREEMENT SIGNATURE PAGE]

    

    

    

    
      
         

      

      
        10

        
          

        

      

      
         

        
        

      

    

    Exhibit
      A

     

    PERFECTENERGY
      INTERNATIONAL LIMITED

    CERTIFICATE
      OF SUBSEQUENT SALE

    

    [Transfer
      Agent]

    __________________________

    __________________________

    

     

    
      	 	
              RE:

            	
              Sale
                of Shares of Common Stock of Perfectenergy International Limited
                (the
                “Company”) pursuant to the Company’s Prospectus dated _______________,
                2007 (the “Prospectus”)

            

    

     

    Dear
      Sir/Madam:

     

    The
      undersigned hereby certifies, in connection with the sale of shares of Common
      Stock of the Company included in the table of Selling Shareholders in the
      Prospectus, that the undersigned has sold the Shares pursuant to the Prospectus
      and in a manner described under the caption “Plan of Distribution” in the
      Prospectus and that such sale complies with all applicable securities laws,
      including, without limitation, the Prospectus delivery requirements of the
      Securities Act of 1933, as amended.

     

    Selling
      Shareholder (the beneficial owner):______________________________

     

    Record
      Holder (e.g., if held in name of
      nominee):__________________________

     

    Restricted
      Stock Certificate No.(s):____________________________________

     

    Number
      of
      Shares Sold:____________________________________________

     

    Date
      of
      Sale:____________________________________________________

     

    In
      the
      event that you receive a stock certificate(s) representing more shares of Common
      Stock than have been sold by the undersigned, then you should return to the
      undersigned a newly issued certificate for such excess shares in the name of
      the
      Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you should place a
      stop
      transfer on your records with regard to such certificate.

     

          

     

     

      
        	Dated:_____________	Very
                truly yours,
	 	 	 
	 	
                By:

              	 
	 	
                Print
                  Name:

              	 
	 	
                Title:

              	 

      

    

     

     

    
      
         

      

        A-1NEITHER
      THESE SECURITIES NOR THE SECURITIES FOR WHICH THESE SECURITIES ARE EXERCISABLE
      HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
      SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
      REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
      SECURITIES OR BLUE SKY LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON
      EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
      MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

     

    

     

    PERFECTENERGY
      INTERNATIONAL LIMITED

     

    WARRANT

     

    Warrant
      No. [ ]Dated:
      August __, 2007

     

    Perfectenergy
      International Limited, a Nevada corporation (the “Company”),
      hereby certifies that, for value received, [Name of Holder] or its registered
      assigns (the “Holder”),
      is
      entitled to purchase from the Company up to a total of [ ] shares of common
      stock, $0.001 par value per share (the “Common
      Stock”),
      of
      the Company (each such share, a “Warrant
      Share”
and
      all
      such shares, the “Warrant
      Shares”)
      at an
      exercise price equal to $0.95 per share (as adjusted from time to time as
      provided in Section
      9,
      the
“Exercise
      Price”),
      at
      any time and from time to time from and after the date hereof and through and
      including the 30 month anniversary of the date hereof (the “Expiration
      Date”),
      and
      subject to the following terms and conditions. This Warrant (this “Warrant”)
      is one
      of a series of similar warrants issued pursuant to that certain Securities
      Purchase Agreement, dated as of the date hereof, by and among the Company and
      the Purchasers identified therein (the “Purchase
      Agreement”).
      All
      such warrants are referred to herein, collectively, as the “Warrants.”

     

    1.
        Definitions.
      In
      addition to the terms defined elsewhere in this Warrant, capitalized terms
      that
      are not otherwise defined herein have the meanings given to such terms in the
      Purchase Agreement.

     

    2.
        Registration
      of Warrant.
      The
      Company shall register this Warrant, upon records to be maintained by the
      Company for that purpose (the “Warrant
      Register”),
      in
      the name of the record Holder hereof from time to time. The Company may deem
      and
      treat the registered Holder of this Warrant as the absolute owner hereof for
      the
      purpose of any exercise hereof or any distribution to the Holder, and for all
      other purposes, absent actual notice to the contrary.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    3.
        Registration
      of Transfers.
      The
      Company shall register the transfer of any portion of this Warrant in the
      Warrant Register, upon surrender of this Warrant, with the Form of Assignment
      attached hereto duly completed and signed, to the Transfer Agent or to the
      Company at its address specified herein. Upon any such registration or transfer,
      a new warrant to purchase Common Stock, in substantially the form of this
      Warrant (any such new warrant, a “New
      Warrant”),
      evidencing the portion of this Warrant so transferred shall be issued to the
      transferee and a New Warrant evidencing the remaining portion of this Warrant
      not so transferred, if any, shall be issued to the transferring Holder. The
      acceptance of the New Warrant by the transferee thereof shall be deemed the
      acceptance by such transferee of all of the rights and obligations of a holder
      of a Warrant.

     

    4.
        Exercise
      and Duration of Warrants.

     

    (a)
        This
      Warrant shall be exercisable by the registered Holder at any time and from
      time
      to time on or after the date hereof to and including the Expiration Date. At
      5:00 P.M., New York City time on the Expiration Date, the portion of this
      Warrant not exercised prior thereto shall be and become void and of no value.
      Notwithstanding anything to the contrary herein, the Expiration Date shall
      be
      extended for each day following the Effective Date (as defined in the
      Registration Rights Agreement) that the Registration Statement is not
      effective.

     

    (b)
        A
      Holder
      may exercise this Warrant by delivering to the Company (i) an exercise notice,
      in the form attached hereto (the “Exercise
      Notice”),
      appropriately completed and duly signed, and (ii) payment of the Exercise
      Price for the number of Warrant Shares as to which this Warrant is being
      exercised (which may take the form of a “cashless exercise” if so indicated in
      the Exercise Notice and if a “cashless exercise” may occur at such time pursuant
      to Section 10 below), and the date such items are delivered to the Company
      (as
      determined in accordance with the notice provisions hereof) is an “Exercise
      Date.”
The
      Holder shall not be required to deliver the original Warrant in order to effect
      an exercise hereunder. Upon the execution and delivery of the Exercise Notice,
      the Company shall issue a New Warrant to the Holder evidencing the right to
      purchase the remaining number of Warrant Shares.

     

    5.
        Delivery
      of Warrant Shares.
      

     

    (a)
        Upon
      exercise of this Warrant, the Company shall promptly (but in no event later
      than
      three Business Days after the Exercise Date) issue or cause to be issued and
      cause to be delivered to or upon the written order of the Holder and in such
      name or names as the Holder may designate, a certificate for the Warrant Shares
      issuable upon such exercise, free of restrictive legends unless a registration
      statement covering the resale of the Warrant Shares and naming the Holder as
      a
      selling stockholder thereunder is not then effective and the Warrant Shares
      are
      not freely transferable without volume restrictions pursuant to Rule 144 under
      the Securities Act. The Holder, or any Person so designated by the Holder to
      receive Warrant Shares, shall be deemed to have become holder of record of
      such
      Warrant Shares as of the Exercise Date. The Company shall, upon request of
      the
      Holder, use its best efforts to deliver Warrant Shares hereunder electronically
      through the Depository Trust Corporation or another established clearing
      corporation performing similar functions.

     

    (b)
        This
      Warrant is exercisable, either in its entirety or, from time to time, for a
      portion of the number of Warrant Shares. Upon surrender of this Warrant
      following one or more partial exercises, the Company shall issue or cause to
      be
      issued, at its expense, a New Warrant evidencing the right to purchase the
      remaining number of Warrant Shares.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

     

    (c)
        In
      addition to any other rights available to a Holder, if the Company fails to
      deliver to the Holder a certificate representing Warrant Shares by the fifth
      Business Day after the date on which delivery of such certificate is required
      by
      this Warrant, and if after such fifth Business Day the Holder purchases (in
      an
      open market transaction or otherwise) shares of Common Stock to deliver in
      satisfaction of a sale by the Holder of the Warrant Shares that the Holder
      anticipated receiving from the Company (a “Buy-In”),
      then
      the Company shall, within three Business Days after the Holder’s request and in
      the Holder's discretion, either (i) pay cash to the Holder in an amount equal
      to
      the Holder’s total purchase price (including brokerage commissions, if any) for
      the shares of Common Stock so purchased (the “Buy-In
      Price”),
      at
      which point the Company’s obligation to deliver such certificate (and to issue
      such Common Stock) shall terminate, or (ii) promptly honor its obligation to
      deliver to the Holder a certificate or certificates representing such Common
      Stock and pay cash to the Holder in an amount equal to the excess (if any)
      of
      the Buy-In Price over the product of (A) such number of shares of Common Stock,
      times (B) the Closing Price on the date of the event giving rise to the
      Company’s obligation to deliver such certificate.

     

    (d)
        The
      Company’s obligations to issue and deliver Warrant Shares in accordance with the
      terms hereof are absolute and unconditional, irrespective of any action or
      inaction by the Holder to enforce the same, any waiver or consent with respect
      to any provision hereof, the recovery of any judgment against any Person or
      any
      action to enforce the same, or any setoff, counterclaim, recoupment, limitation
      or termination, or any breach or alleged breach by the Holder or any other
      Person of any obligation to the Company or any violation or alleged violation
      of
      law by the Holder or any other Person, and irrespective of any other
      circumstance which might otherwise limit such obligation of the Company to
      the
      Holder in connection with the issuance of Warrant Shares. Nothing herein shall
      limit a Holder’s right to pursue any other remedies available to it hereunder,
      at law or in equity including, without limitation, a decree of specific
      performance and/or injunctive relief with respect to the Company’s failure to
      timely deliver certificates representing shares of Common Stock upon exercise
      of
      the Warrant as required pursuant to the terms hereof.

     

    6.
        Charges,
      Taxes and Expenses.
      Issuance and delivery of certificates for shares of Common Stock upon exercise
      of this Warrant shall be made without charge to the Holder for any issue or
      transfer tax, withholding tax, transfer agent fee or other incidental tax or
      expense in respect of the issuance of such certificates, all of which taxes
      and
      expenses shall be paid by the Company; provided, however, that the Company
      shall
      not be required to pay any tax which may be payable in respect of any transfer
      involved in the registration of any certificates for Warrant Shares or Warrants
      in a name other than that of the Holder or an Affiliate thereof. The Holder
      shall be responsible for all other tax liability that may arise as a result
      of
      holding or transferring this Warrant or receiving Warrant Shares upon exercise
      hereof.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

     

    7.
        Replacement
      of Warrant.
      If this
      Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or
      cause to be issued in exchange and substitution for and upon cancellation
      hereof, or in lieu of and substitution for this Warrant, a New Warrant, but
      only
      upon receipt of evidence reasonably satisfactory to the Company of such loss,
      theft or destruction and customary and reasonable bond or indemnity, if
      requested. Applicants for a New Warrant under such circumstances shall also
      comply with such other reasonable regulations and procedures and pay such other
      reasonable third-party costs as the Company may prescribe.

     

    8.
        Reservation
      of Warrant Shares.
      The
      Company covenants that it will at all times reserve and keep available out
      of
      the aggregate of its authorized but unissued and otherwise unreserved Common
      Stock, solely for the purpose of enabling it to issue Warrant Shares upon
      exercise of this Warrant as herein provided, the number of Warrant Shares which
      are then issuable and deliverable upon the exercise of this entire Warrant,
      free
      from preemptive rights or any other contingent purchase rights of persons other
      than the Holder (taking into account the adjustments and restrictions of
Section
      9).
      The
      Company covenants that all Warrant Shares so issuable and deliverable shall,
      upon issuance and the payment of the applicable Exercise Price in accordance
      with the terms hereof, be duly and validly authorized, issued and fully paid
      and
      nonassessable. The Company will take all such actions as may be necessary to
      assure that such shares of Common Stock may be issued as provided herein without
      violation of any applicable law or regulation, or of any requirements of any
      securities exchange or automated quotation system upon which the Common Stock
      may be listed.

     

    9.
        Certain
      Adjustments.
      The
      Exercise Price and number of Warrant Shares issuable upon exercise of this
      Warrant are subject to adjustment from time to time as set forth in this
Section
      9.

     

    (a)
        Stock
      Dividends and Splits.
      If the
      Company, at any time while this Warrant is outstanding, (i) pays a stock
      dividend on its Common Stock or otherwise makes a distribution on any class
      of
      capital stock that is payable in shares of Common Stock, (ii) subdivides
      outstanding shares of Common Stock into a larger number of shares, or (iii)
      combines outstanding shares of Common Stock into a smaller number of shares,
      then in each such case the Exercise Price shall be multiplied by a fraction
      of
      which the numerator shall be the number of shares of Common Stock outstanding
      immediately before such event and of which the denominator shall be the number
      of shares of Common Stock outstanding immediately after such event. Any
      adjustment made pursuant to clause (i) of this paragraph shall become effective
      immediately after the record date for the determination of stockholders entitled
      to receive such dividend or distribution, and any adjustment pursuant to clause
      (ii) or (iii) of this paragraph shall become effective immediately after the
      effective date of such subdivision or combination.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

     

    (b)
        Pro
      Rata Distributions.
      If the
      Company, at any time while this Warrant is outstanding, distributes to all
      holders of Common Stock (i) evidences of its indebtedness, (ii) any security
      (other than a distribution of Common Stock covered by the preceding paragraph),
      (iii) rights or warrants to subscribe for or purchase any security, or (iv)
      any other asset (in each case, “Distributed
      Property”),
      then
      in each such case the Exercise Price in effect immediately prior to the record
      date fixed for determination of stockholders entitled to receive such
      distribution shall be adjusted (effective on such record date) to equal the
      product of such Exercise Price times a fraction of which the denominator shall
      be the average of the Closing Prices for the five Business Days immediately
      prior to (but not including) such record date and of which the numerator shall
      be such average less the then fair market value of the Distributed Property
      distributed in respect of one outstanding share of Common Stock, as determined
      by the Company's independent certified public accountants that regularly examine
      the financial statements of the Company (an “Appraiser”).
      In
      such event, the Holder, after receipt of the determination by the Appraiser,
      shall have the right to select an additional appraiser (which shall be a
      nationally recognized accounting firm), in which case such fair market value
      shall be deemed to equal the average of the values determined by each of the
      Appraiser and such appraiser. As an alternative to the foregoing adjustment
      to
      the Exercise Price, at the request of the Holder delivered before the 90th
      day
      after such record date the Company will deliver to such Holder, within five
      Business Days after such request (or, if later, on the effective date of such
      distribution), the Distributed Property that such Holder would have been
      entitled to receive in respect of the Warrant Shares for which this Warrant
      could have been exercised immediately prior to such record date. If such
      Distributed Property is not delivered to a Holder pursuant to the preceding
      sentence, then upon expiration of or any exercise of the Warrant that occurs
      after such record date, such Holder shall remain entitled to receive, in
      addition to the Warrant Shares otherwise issuable upon such exercise (if
      applicable), such Distributed Property. 

     

    (c)
        Fundamental
      Transactions.
      If, at
      any time while this Warrant is outstanding, (i) the Company effects any merger
      or consolidation of the Company with or into another Person, (ii) the Company
      effects any sale of all or substantially all of its assets in one or a series
      of
      related transactions, (iii) any tender offer or exchange offer (whether by
      the
      Company or another Person) is completed pursuant to which holders of Common
      Stock are permitted to tender or exchange their shares for other securities,
      cash or property, or (iv) the Company effects any reclassification of the Common
      Stock or any compulsory share exchange pursuant to which the Common Stock is
      effectively converted into or exchanged for other securities, cash or property
      (other than as a result of a subdivision or combination of shares of Common
      Stock covered by Section 9(a) above) (in any such case, a “Fundamental
      Transaction”),
      then
      the Holder shall have the right thereafter to receive, upon exercise of this
      Warrant, the same amount and kind of securities, cash or property as it would
      have been entitled to receive upon the occurrence of such Fundamental
      Transaction if it had been, immediately prior to such Fundamental Transaction,
      the holder of the number of Warrant Shares then issuable upon exercise in full
      of this Warrant (the “Alternate
      Consideration”).
      The
      aggregate Exercise Price for this Warrant will not be affected by any such
      Fundamental Transaction, but the Company shall apportion such aggregate Exercise
      Price among the Alternate Consideration in a reasonable manner reflecting the
      relative value of any different components of the Alternate Consideration.
      If
      holders of Common Stock are given any choice as to the securities, cash or
      property to be received in a Fundamental Transaction, then the Holder shall
      be
      given the same choice as to the Alternate Consideration it receives upon any
      exercise of this Warrant following such Fundamental Transaction. In the event
      of
      a Fundamental Transaction, the Company or the successor or purchasing Person,
      as
      the case may be, shall execute with the Holder a written agreement providing
      that:

    
 

    (x)
       this
      Warrant shall thereafter entitle the Holder to purchase the Alternate
      Consideration in accordance with this section 9(c), 

    

    (y) in
      the
      case of any such successor or purchasing Person, upon such consolidation,
      merger, statutory exchange, combination, sale or conveyance such successor
      or
      purchasing Person shall be jointly and severally liable with the Company for
      the
      performance of all of the Company's obligations under this Warrant and the
      Purchase Agreement, and 

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    

    (z) if
      registration or qualification is required under the Exchange Act or applicable
      state law for the public resale by the Holder of shares of stock and other
      securities so issuable upon exercise of this Warrant, all rights applicable
      to
      registration of the Common Stock issuable upon exercise of this Warrant shall
      apply to the Alternate Consideration. 

    

    If,
      in
      the case of any Fundamental Transaction, the Alternate Consideration includes
      shares of stock, other securities, other property or assets of a Person other
      than the Company or any such successor or purchasing Person, as the case may
      be,
      in such Fundamental Transaction, then such written agreement shall also be
      executed by such other Person and shall contain such additional provisions
      to
      protect the interests of the Holder as the Board of Directors of the Company
      shall reasonably consider necessary by reason of the foregoing. At the Holder’s
      request, any successor to the Company or surviving entity in such Fundamental
      Transaction shall issue to the Holder a new warrant consistent with the
      foregoing provisions and evidencing the Holder’s right to purchase the Alternate
      Consideration for the aggregate Exercise Price upon exercise thereof. The terms
      of any agreement pursuant to which a Fundamental Transaction is effected shall
      include terms requiring any such successor or surviving entity to comply with
      the provisions of this paragraph (c) and insuring that the Warrant (or any
      such
      replacement security) will be similarly adjusted upon any subsequent transaction
      analogous to a Fundamental Transaction. If any Fundamental Transaction
      constitutes or results in a change of control, the Company (or any such
      successor or surviving entity) will purchase the Warrant from the Holder for
      a
      purchase price, payable in cash within five Business Days after such request
      (or, if later, on the effective date of the Fundamental Transaction), equal
      to
      the Black-Scholes value of the remaining unexercised portion of this Warrant
      on
      the date of such request.

     

    (d)
        Subsequent
      Equity Sales.

     

    If,
      at
      any time while this Warrant is outstanding, the Company or any subsidiary issues
      additional shares of Common Stock or rights, warrants, options or other
      securities or debt convertible, exercisable or exchangeable for shares of Common
      Stock or otherwise entitling any Person to acquire shares of Common Stock
      (collectively, “Common
      Stock Equivalents”)
      at an
      effective net price to the Company per share of Common Stock (the “Effective
      Price”)
      less
      than the Exercise Price (as adjusted hereunder to such date), then the Exercise
      Price shall be reduced to the price determined by dividing (x) the sum of
      (A) the Common Stock actually outstanding (as defined below) immediately
      prior to such issuance or sale (or deemed issuance or sale) multiplied by the
      Exercise Price then in effect and (B) the consideration, if any, received
      by the Company upon such issuance or sale (or deemed issuance or sale) by
      (y) the Common Stock Deemed Outstanding immediately after such issuance or
      sale (or deemed issuance or sale). For purposes of this paragraph, in connection
      with any issuance of any Common Stock Equivalents, (A) the maximum number of
      shares of Common Stock potentially issuable at any time upon conversion,
      exercise or exchange of such Common Stock Equivalents (the “Deemed
      Number”)
      shall
      be deemed to be outstanding upon issuance of such Common Stock Equivalents,
      (B)
      the Effective Price applicable to such Common Stock shall equal the minimum
      dollar value of consideration payable to the Company to purchase such Common
      Stock Equivalents and to convert, exercise or exchange them into Common Stock
      (net of any discounts, fees, commissions and other expenses), divided by the
      Deemed Number, and (C) no further adjustment shall be made to the Exercise
      Price
      upon the actual issuance of Common Stock upon conversion, exercise or exchange
      of such Common Stock Equivalents. The Effective Price of Common Stock or Common
      Stock Equivalents issued in any transaction in which more than one type of
      securities are issued shall give effect to the allocation by the Company of
      the
      aggregate amount paid for such securities issued in such
      transaction.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

     

    Notwithstanding
      the foregoing, no adjustment will be made under this paragraph (d) in respect
      of
      any Excluded Stock. For purposes hereof, “Excluded Stock” means any Common Stock
      issued or issuable: (i) in connection with any of the Company’s stockholder
      approved equity compensation plans; (ii) upon the exercise of the Warrants;
      (iii) pursuant to a bona fide underwritten public offering with a
      nationally recognized NASD registered underwriter which generates gross proceeds
      to the Company in excess of $10,000,000; (iv) in connection with any acquisition
      by the Company, whether through an acquisition of stock or a merger of any
      business, assets or technologies the primary purpose of which is not to raise
      equity capital in an amount not to exceed, in the aggregate, 20% of the
      outstanding shares of Common Stock in any calendar year; or (v) upon
      exercise of any options which are outstanding on the day immediately preceding
      the date hereof, provided that the terms of such options are not amended,
      modified or changed on or after the date hereof.

     

    (e)
        Number
      of Warrant Shares.
      Simultaneously with any adjustments to the Exercise Price pursuant to paragraphs
      (a), (b) or (d) of this Section, the number of Warrant Shares that may be
      purchased upon exercise of this Warrant shall be increased or decreased
      proportionately, so that after such adjustment the aggregate Exercise Price
      payable hereunder for the increased or decreased number of Warrant Shares shall
      be the same as the aggregate Exercise Price in effect immediately prior to
      such
      adjustment.

     

    (f)
        Calculations.
      All
      calculations under this Section
      9
      shall be
      made to the nearest cent or the nearest 1/100th of a share, as applicable.
      The
      number of shares of Common Stock outstanding at any given time shall not include
      shares owned or held by or for the account of the Company, and the disposition
      of any such shares shall be considered an issue or sale of Common
      Stock.

     

    (g)
        Notice
      of Adjustments.
      Upon
      the occurrence of each adjustment pursuant to this Section
      9,
      the
      Company at its expense will promptly compute such adjustment in accordance
      with
      the terms of this Warrant and prepare a certificate setting forth such
      adjustment, including a statement of the adjusted Exercise Price and adjusted
      number or type of Warrant Shares or other securities issuable upon exercise
      of
      this Warrant (as applicable), describing the transactions giving rise to such
      adjustments and showing in detail the facts upon which such adjustment is based.
      Upon written request, the Company will promptly deliver a copy of each such
      certificate to the Holder and to the Company’s Transfer Agent.

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

     

    (h)
        Notice
      of Corporate Events.
      If the
      Company (i) declares a dividend or any other distribution of cash, securities
      or
      other property in respect of its Common Stock, including without limitation
      any
      granting of rights or warrants to subscribe for or purchase any capital stock
      of
      the Company or any Subsidiary, (ii) authorizes or approves, enters into any
      agreement contemplating or solicits stockholder approval for any Fundamental
      Transaction or (iii) authorizes the voluntary dissolution, liquidation or
      winding up of the affairs of the Company, then the Company shall deliver to
      the
      Holder a notice describing the material terms and conditions of such
      transaction, at least 20 calendar days prior to the applicable record or
      effective date on which a Person would need to hold Common Stock in order to
      participate in or vote with respect to such transaction, and the Company will
      take all steps reasonably necessary in order to insure that the Holder is given
      the practical opportunity to exercise this Warrant prior to such time so as
      to
      participate in or vote with respect to such transaction; provided, however,
      that
      the failure to deliver such notice or any defect therein shall not affect the
      validity of the corporate action required to be described in such notice.

     

    10.
        Payment
      of Exercise Price.
      The
      Holder shall pay the Exercise Price in immediately available funds; provided,
      however, if at anytime after the first anniversary of the issuance of this
      Warrant there is no effective Registration Statement registering, or no current
      prospectus available for, the resale of the Warrant Shares by the Holder, the
      Holder may satisfy its obligation to pay the Exercise Price through a “cashless
      exercise,” in which event the Company shall issue to the Holder the number of
      Warrant Shares determined as follows:

     

    
      	 	
              X
                =
                Y [(A-B)/A]

            
	
              where:

            	 
	 	
              X
                =
                the number of Warrant Shares to be issued to the
                Holder.

            
	 	 
	 	
              Y
                =
                the number of Warrant Shares with respect to which this Warrant is
                being
                exercised.

            
	 	 
	 	
              A
                =
                the arithmetic average of the Closing Prices for the five Trading
                Days
                immediately prior to (but not including) the Exercise
                Date.

            
	 	 
	 	
              B
                =
                the Exercise Price.

            

    

    

    For
      purposes of Rule 144 promulgated under the Securities Act, it is intended,
      understood and acknowledged that the Warrant Shares issued in a cashless
      exercise transaction shall be deemed to have been acquired by the Holder, and
      the holding period for the Warrant Shares shall be deemed to have commenced,
      on
      the date this Warrant was originally issued pursuant to the Purchase
      Agreement.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    

     

    11.
        Limitation
      on Exercise.
      Notwithstanding anything to the contrary contained herein, the
      number of shares of Common Stock that may be acquired by the Holder upon any
      exercise of this Warrant (or otherwise in respect hereof) shall be limited
      to
      the extent necessary to insure that, following such exercise (or other
      issuance), the total number of shares of Common Stock then beneficially owned
      by
      such Holder and its Affiliates and any other Persons whose beneficial ownership
      of Common Stock would be aggregated with the Holder’s for purposes of Section
      13(d) of the Exchange Act, does not exceed 4.999% (the “Threshold
      Percentage”)
      or
      9.999% (the “Maximum
      Percentage”)
      of the
      total number of issued and outstanding shares of Common Stock (including for
      such purpose the shares of Common Stock issuable upon such
      exercise).
      For such
      purposes, beneficial ownership shall be determined in accordance with Section
      13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
      Each delivery of an Exercise Notice hereunder will constitute a representation
      by the Holder that it has evaluated the limitations set forth in this paragraph
      and determined that issuance of the full number of Warrant Shares requested
      in
      such Exercise Notice is permitted under this paragraph. The Company’s obligation
      to issue shares of Common Stock in excess of the limitation referred to in
      this
      Section shall be suspended (and shall not terminate or expire notwithstanding
      any contrary provisions hereof) until such time, if any, as such shares of
      Common Stock may be issued in compliance with such limitation. By written notice
      to the Company, the Holder shall have the right (x) at any time and from time
      to
      time to reduce its Maximum Percentage immediately upon notice to the Company
      in
      the event and only to the extent that Section 16 of the Exchange Act or the
      rules promulgated thereunder (or any successor statute or rules) is changed
      to
      reduce the beneficial ownership percentage threshold thereunder to a percentage
      less than 9.999% and (y) at any time and from time to time, to waive the
      provisions of this Section insofar as they relate to the Threshold Percentage
      or
      to increase or decrease its Threshold Percentage (but not in excess of the
      Maximum Percentage) unless the Holder shall have, by written instrument
      delivered to the Company, irrevocably waived its rights to so increase or
      decrease its Threshold Percentage, but (i) any such waiver, increase or decrease
      will not be effective until the 61st day after such notice is delivered to
      the
      Company, and (ii) any such waiver or increase or decrease will apply only to
      the
      Holder and not to any other holder of Warrants

     

    

    12.
        Fractional
      Shares.
      The
      Company shall not be required to issue or cause to be issued fractional Warrant
      Shares on the exercise of this Warrant. If any fraction of a Warrant Share
      would, except for the provisions of this Section, be issuable upon exercise
      of
      this Warrant, the number of Warrant Shares to be issued will be rounded up
      to
      the nearest whole share.

     

    13.
        Notices.
      Any and
      all notices or other communications or deliveries hereunder (including without
      limitation any Exercise Notice) shall be in writing and shall be deemed given
      and effective on the earliest of (i) the date of transmission, if such notice
      or
      communication is delivered via facsimile at the facsimile number specified
      in
      this Section prior to 5:00 p.m. (New York City time) on a Business Day, (ii)
      the
      next Business Day after the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number specified
      in
      this Section on a day that is not a Business Day or later than 5:00 p.m. (New
      York City time) on any Business Day, (iii) the Business Day following the date
      of mailing, if sent by nationally recognized overnight courier service, or
      (iv)
      upon actual receipt by the party to whom such notice is required to be given.
      The address for such notices or communications shall be as set forth in the
      Purchase Agreement.

     

    14.
        Warrant
      Agent.
      The
      Company shall serve as warrant agent under this Warrant. Upon 30 days' notice
      to
      the Holder, the Company may appoint a new warrant agent. Any corporation into
      which the Company or any new warrant agent may be merged or any corporation
      resulting from any consolidation to which the Company or any new warrant agent
      shall be a party or any corporation to which the Company or any new warrant
      agent transfers substantially all of its corporate trust or shareholders
      services business shall be a successor warrant agent under this Warrant without
      any further act. Any such successor warrant agent shall promptly cause notice
      of
      its succession as warrant agent to be mailed (by first class mail, postage
      prepaid) to the Holder at the Holder's last address as shown on the Warrant
      Register.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    

     

    15.
        Miscellaneous.

     

    (a)
        Subject
      to the restrictions on transfer set forth on the first page hereof, this Warrant
      may be assigned by the Holder. This Warrant may not be assigned by the Company
      except to a successor in the event of a Fundamental Transaction. This Warrant
      shall be binding on and inure to the benefit of the parties hereto and their
      respective successors and assigns. Subject to the preceding sentence, nothing
      in
      this Warrant shall be construed to give to any Person other than the Company
      and
      the Holder any legal or equitable right, remedy or cause of action under this
      Warrant. This Warrant may be amended only in writing signed by the Company
      and
      the Holder and their successors and assigns.

     

    (b)
        The
      Company will not, by amendment of its governing documents or through any
      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 of the 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. Without limiting the generality
      of
      the foregoing, the Company (i) will not increase the par value of any Warrant
      Shares above the amount payable therefor on such exercise, (ii) will take all
      such action as may be reasonably necessary or appropriate in order that the
      Company may validly and legally issue fully paid and nonassessable Warrant
      Shares on the exercise of this Warrant, and (iii) will not close its shareholder
      books or records in any manner which interferes with the timely exercise of
      this
      Warrant.

     

    (c)
        Governing
      Law; Venue; Waiver Of Jury Trial.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant shall be governed by and construed and enforced in accordance
      with the internal laws of the State of New York, without regard to the
      principles of conflicts of law thereof. Each party agrees that all legal
      proceedings concerning the interpretations, enforcement and defense of the
      transactions contemplated by any of the Transaction Documents (whether brought
      against a party hereto or its respective Affiliates, directors, officers,
      shareholders, employees or agents) shall be commenced exclusively in the state
      and federal courts sitting in the City of New York, Borough of Manhattan. Each
      party hereto hereby irrevocably submits to the exclusive jurisdiction of the
      state and federal courts sitting in the City of New York, Borough of Manhattan
      for the adjudication of any dispute hereunder or in connection herewith or
      with
      any transaction contemplated hereby or discussed herein (including with respect
      to the enforcement of any of this Warrant), and hereby irrevocably waives,
      and
      agrees not to assert in any suit, action or proceeding, any claim that it is
      not
      personally subject to the jurisdiction of any such court, that such suit, action
      or proceeding is improper. Each party hereto hereby irrevocably waives personal
      service of process and consents to process being served in any such suit, action
      or proceeding by mailing a copy thereof via registered or certified mail or
      overnight delivery (with evidence of delivery) to such party at the

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    address
      in effect for notices to it under this Warrant and agrees that such service
      shall constitute good and sufficient service of process and notice thereof.
      Nothing contained herein shall be deemed to limit in any way any right to serve
      process in any manner permitted by law. Each party hereto hereby irrevocably
      waives, to the fullest extent permitted by applicable law, any and all right
      to
      trial by jury in any legal proceeding arising out of or relating to this Warrant
      or any of the Transaction Documents or the transactions contemplated hereby
      or
      thereby. If either party shall commence an action or proceeding to enforce
      any
      provisions of this Warrant or any Transaction Document, then the prevailing
      party in such action or proceeding shall be reimbursed by the other party for
      its reasonable attorneys fees and other reasonable costs and expenses incurred
      with the investigation, preparation and prosecution of such action or
      proceeding.

     

    (d)
        The
      headings herein are for convenience only, do not constitute a part of this
      Warrant and shall not be deemed to limit or affect any of the provisions
      hereof.

     

    (e)
        In
      case
      any one or more of the provisions of this Warrant shall be invalid or
      unenforceable in any respect, the validity and enforceability of the remaining
      terms and provisions of this Warrant shall not in any way be affected or
      impaired thereby and the parties will attempt in good faith to agree upon a
      valid and enforceable provision which shall be a commercially reasonable
      substitute therefor, and upon so agreeing, shall incorporate such substitute
      provision in this Warrant.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK,

     

    SIGNATURE
      PAGE FOLLOWS]

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
      its
      authorized officer as of the date first indicated above.

     

    
      	 	 	 
	 	
              PERFECTENERGY
                INTERNATIONAL LIMITED

            
	 	 	 
	 	 	 
	 	
              By:
                

            	 
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 

    

    

     

    
      
         

      

      
        12

        
          

        

      

      
         

        
        

      

    

    FORM
      OF
      EXERCISE NOTICE

     

    (To
      be
      executed by the Holder to exercise the right to purchase shares of Common Stock
      under the foregoing Warrant)

     

    To:
      Perfectenergy International Limited

     

    The
      undersigned is the Holder of Warrant No. _______ (the “Warrant”)
      issued
      by Perfectenergy International Limited, a Nevada corporation (the “Company”).
      Capitalized terms used herein and not otherwise defined have the respective
      meanings set forth in the Warrant.

     

    	1.
              	
            The
              Warrant is currently exercisable to purchase a total of ______________
              Warrant Shares.

          

     

    	2.
              	
            The
              undersigned Holder hereby exercises its right to purchase
              _________________ Warrant Shares pursuant to the
              Warrant.

          

     

    	3.
              	
            The
              Holder intends that payment of the Exercise Price shall be made as
              (check
              one):

          

     

    ____ “Cash
      Exercise” under Section 10

     

    ____ “Cashless
      Exercise” under Section 10 (if permitted)

     

    	4.
              	
            If
              the holder has elected a Cash Exercise, the holder shall pay the sum
              of
              $____________ to the Company in accordance with the terms of the
              Warrant.

          

     

    	5.
              	
            Pursuant
              to this exercise, the Company shall deliver to the holder _______________
              Warrant Shares in accordance with the terms of the
              Warrant.

          

     

    	6.
              	
            Following
              this exercise, the Warrant shall be exercisable to purchase a total
              of
              ______________ Warrant Shares.

          

     

    
      	 	 	 
	 	 	 
	
              Dated:
                __________,
                _____

            	
              Name
                of Holder:

            
	 	 	 
	 	
              (Print)
                

            	
               

            
	 	 	 
	 	
              By:

            	
               

            
	 	
              Name:

            	
               

            
	 	
              Title:

            	
               

            
	 	 	 
	 	 (Signature
              must conform in all respects to name of holder as specified on the
              face of
              the Warrant)

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    FORM
      OF
      ASSIGNMENT

     

    [To
      be
      completed and signed only upon transfer of Warrant]

     

    FOR
      VALUE
      RECEIVED, the undersigned hereby sells, assigns and transfers unto
      ________________________________ the right represented by the within Warrant
      to
      purchase ____________ shares of Common Stock of Perfectenergy International
      Limited to which the within Warrant relates and appoints ________________
      attorney to transfer said right on the books of Perfectenergy International
      Limited with full power of substitution in the premises.

     

    
      	 	 
	 	 
	
              Dated:
                _____________,
                ____

            	 
	 	 
	 	 
	 	
              (Signature
                must conform in all respects to name of holder as specified on the
                face of
                the Warrant)

            
	 	 
	 	 
	 	
              Address
                of Transferee

            
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	
              In
                the presence of:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}]]