Document:

Unassociated Document

    

     

    SECURITIES
      PURCHASE AGREEMENT

     

    THIS SECURITIES
      PURCHASE AGREEMENT
      (this
“Agreement”), dated as of June 22, 2007, is entered into by and among Cromwell
      Uranium Corp.,
      a Nevada
      corporation (the “Company”), Gottbetter
      & Partners, LLP (with
      respect to Article 8 hereof) and the Buyers listed on Schedule I attached
      hereto (individually, a “Buyer” or collectively “Buyers”).

     

     

    WITNESSETH:

     

    WHEREAS,
      the
      Company and the Buyer(s) are executing and delivering this Agreement in reliance
      upon an exemption from securities registration pursuant to Section 4(2) and/or
      Rule 506 of Regulation D (“Regulation D”) and/or Regulation S (“Regulation
      S”) as promulgated by the U.S. Securities and Exchange Commission (the “SEC”)
      under the Securities Act of 1933, as amended (the “Securities
      Act”);

     

    WHEREAS,
      the
      parties desire that, upon the terms and subject to the conditions contained
      herein, the Company shall issue and sell to the Buyer(s), as provided herein,
      and the Buyer(s) shall purchase up to Seven Hundred Fifty Thousand Dollars
      ($750,000) (the “Purchase Price”) principal amount of secured Convertible
      Debentures (the “Convertible Debentures”), which shall become convertible into
      units (“Units”) of the Company’s securities at a conversion price ( the
“Conversion Price”) of $0.50 per Unit. Each Unit shall consist of one share of
      the Company’s common stock, par value $0.001 (the “Common Stock”) (as converted,
      the “Conversion Shares”) and one common stock purchase warrant (“Warrants”),
      exercisable at a price of $0.75 per share. The total Purchase Price shall be
      allocated among the Buyer(s) in the respective amounts set forth opposite each
      Buyers name on Schedule I (the “Subscription Amount”); and

     

    WHEREAS,
      all
      of the
      total principal amount of the Convertible Debentures, subject to the deduction
      of any and all fees, shall be utilized by the Company to make a loan (the
“Bridge Loan”) to Cromwell Uranium Holdings, Inc. (“Cromwell”); and

     

    WHEREAS,
      the
      Company (i) is currently negotiating a reverse triangular merger with Cromwell
      (the “Merger”) and (ii) intends to conduct a private placement offering (the
“PPO”) of its Units subsequent to the closing of the Merger; and

     

    WHEREAS,
      in
      connection with the Merger and the PPO the Company shall (i) change its name
      (the “Name Change”) to Cromwell Uranium Corp., (ii) increase its authorized
      capital stock (the “Recapitalization”) to 300,000,000 shares of Common Stock and
      10,000,000 shares of preferred stock, $0.001 par value per share (“Preferred
      Stock”) and (ii) conduct a 6.35 for one forward stock split (the “Stock Split”)
      in the form of a stock dividend

     

    WHEREAS,
      the
      Convertible Debentures shall be automatically converted into Units
      simultaneously with the closing of the Merger (and prior to the commencement
      of
      the PPO) (the Merger, the PPO, the Stock Split and the transactions contemplated
      thereby are sometimes hereinafter referred to as the “Transactions”);
      and

     

     

    
      
        
        

      

      
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    WHEREAS,
      the
      aggregate proceeds of the sale of the Convertible Debentures shall be held
      in
      escrow by the Escrow Agent, as defined below, pursuant to the terms of Article
      8
      of this Agreement.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants and other agreements contained in this
      Agreement the Company and the Buyer(s) hereby agree as follows:

     

    1.  PURCHASE
      AND SALE OF CONVERTIBLE DEBENTURES.

     

    (a)  Purchase
      of Convertible Debentures.
      Subject
      to the satisfaction (or waiver) of the terms and conditions of this Agreement,
      each Buyer agrees, severally and not jointly, to purchase at Closing (as defined
      herein below) and the Company agrees to sell and issue to each Buyer, severally
      and not jointly, at Closing, Convertible Debentures in amounts set forth
      opposite each Buyer’s name on Schedule I hereto. Upon execution hereof by a
      Buyer, the Buyer shall wire transfer the Subscription Amount set forth opposite
      his name on Schedule I in same-day funds or a check payable to “Gottbetter &
Partners, LLP, as Escrow Agent for Arbutus Resources, Inc.”, which Subscription
      Amount shall be held in escrow pursuant to the terms of Article 8 of this
      Agreement and disbursed in accordance therewith.

     

    (b)  Closing
      Date.
      The
      Closing of the purchase and sale of the Convertible Debentures shall take place
      at 10:00 a.m. Eastern Standard Time on or before the fifth (5th)
      business day following the date hereof, subject to notification of satisfaction
      of the conditions to the Closing set forth herein and in Sections 7 and 8 below
      (or such later date as is mutually agreed to by the Company and the Buyer(s))
      (the “Closing
      Date”).
      The
      Closing shall occur on the Closing Date at the offices of Gottbetter &
Partners, LLP, 488 Madison Avenue, New York, New York 10022 (or such other
      place
      as is mutually agreed to by the Company and the Buyer(s)). 

     

    (c)  Escrow
      Arrangements; Form of Payment.
      Upon
      execution hereof by Buyer and pending the Closing, the Purchase Price shall
      be
      deposited in a non-interest bearing escrow account with Gottbetter &
Partners, LLP as escrow agent (the “Escrow
      Agent”),
      pursuant to the terms of Article 8 of this Agreement. Subject to the
      satisfaction of the terms and conditions of this Agreement, on the Closing
      Date,
      (i) the Escrow Agent shall deliver to the Company the Purchase Price for the
      Convertible Debentures to be issued and sold to the Buyer(s), and (ii) the
      Company shall deliver to the Buyer(s), the Convertible Debenture, duly executed
      on behalf of the Company.

     

    2.  BUYER’S
      REPRESENTATIONS AND WARRANTIES.

     

    Each
      Buyer represents and warrants, severally and not jointly, that:

     

    (a)  Investment
      Purpose.
      Each
      Buyer is acquiring the Convertible Debentures, and, upon conversion of
      Convertible Debentures, the Buyer will acquire the Conversion Shares, the
      Warrants and/or Warrant Shares, then issuable, for its own account for
      investment only and not with a view towards, or for resale in connection with,
      the public sale or distribution thereof, except pursuant to sales registered
      or
      exempted under the Securities Act; provided, however, that by making the
      representations herein, such Buyer reserves the right to dispose of the
      Conversion Shares, the Warrants and the Warrant Shares at any time
      in

     

     

    
      
        
        

      

      
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    accordance
      with or pursuant to an effective registration statement covering such Conversion
      Shares, the Warrants and the Warrant Shares or an available exemption under
      the
      Securities Act. The Buyer agrees not to sell, hypothecate or otherwise transfer
      the Buyer’s securities unless the securities are registered under the Federal
      and applicable state securities laws or unless, in the opinion of counsel
      satisfactory to the Company, an exemption from such law is
      available.

     

    (b)  Residence
      of Buyer.
      Each
      Buyer resides in the jurisdiction set forth opposite the Buyer’s name on
      Schedule I.

     

    (c)  Non-US
      Person.
      If a
      Buyer is not a person in the United States or a U.S. Person (as defined in
      Rule
      902(k) of Regulation S) or is not purchasing the Convertible Debentures on
      behalf of a person in the United States or a U.S. Person:

     

    (i)  neither
      the Buyer nor any disclosed principal is a U.S. Person nor are they subscribing
      for the Convertible Debentures for the account of a U.S. Person or for resale
      in
      the United States and the Buyer confirms that the Convertible Debentures have
      not been offered to the Buyer in the United States and that this Agreement
      has
      not been signed in the United States;

     

    (ii)  the
      Buyer
      acknowledges that the Convertible Debentures have not been registered under
      the
      Securities Act and may not be offered or sold in the United States or to a
      U.S.
      Person unless the securities are registered under the U.S. Securities Act and
      all applicable state securities laws or an exemption from such registration
      requirements is available, and further agrees that hedging transactions
      involving such securities may not be conducted unless in compliance with the
      U.S. Securities Act;

     

    (iii)  the
      Buyer
      and if applicable, the disclosed principal for whom the Buyer is acting,
      understands that the Company is the seller of the Convertible Debentures and
      underlying securities and that, for purposes of Regulation S, a "distributor” is
      any underwriter, dealer or other person who participates, pursuant to a
      contractual arrangement in the distribution of securities sold in reliance
      on
      Regulation S and that an "affiliate" is any partner, officer, director or any
      person directly or indirectly controlling, controlled by or under common control
      with any person in question. Except as otherwise permitted by Regulation S,
      the
      Buyer and if applicable, the disclosed principal for whom the Buyer is acting,
      agrees that it will not, during a one year distribution compliance period,
      act
      as a distributor, either directly or through any affiliate, or sell, transfer,
      hypothecate or otherwise convey the Debentures or underlying securities other
      than to a non-U.S. Person;

     

    (iv)  the
      Buyer
      and if applicable, the disclosed principal for whom the Buyer is acting,
      acknowledges and understands that in the event the Convertible Debentures are
      offered, sold or otherwise transferred by the Buyer or if applicable, the
      disclosed principal for whom the Buyer is acting, to a non-U.S Person prior
      to
      the expiration of a one year distribution compliance period, the purchaser
      or
      transferee must agree not to resell such securities except in accordance with
      the provisions of Regulation S, pursuant to registration under the Securities
      Act, or pursuant to an available exemption from registration; and must further
      agree not to engage in hedging transactions with regard to such securities
      unless in compliance with the Securities Act; and

     

     

    
      
        
        

      

      
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    (v)  neither
      the Buyer nor any disclosed principal will offer, sell or otherwise dispose
      of
      the Convertible Debentures or the underlying securities in the United States
      or
      to a U.S. Person unless (A) the Company has consented to such offer, sale or
      disposition and such offer, sale or disposition is made in accordance with
      an
      exemption from the registration requirements under the Securities Act and the
      securities laws of all applicable states of the United States or (B) the United
      States Securities and Exchange Commission (the “SEC”) has declared effective a
      registration statement in respect of such securities.

     

    (d)  Accredited
      Investor Status.
      If the
      Buyer is a person in the United States or a U.S. person, such Buyer is an
“Accredited
      Investor”
as
      that
      term is defined in Rule 501(a)(3) of Regulation D.

     

    (e)  Reliance
      on Exemptions.
      Each
      Buyer understands that the Convertible Debentures are being offered and sold
      to
      it in reliance on specific exemptions from the registration requirements of
      United States federal and state securities laws and that the Company is relying
      in part upon the truth and accuracy of, and such Buyer’s compliance with, the
      representations, warranties, agreements, acknowledgments and understandings
      of
      such Buyer set forth herein in order to determine the availability of such
      exemptions and the eligibility of such Buyer to acquire such
      securities.

     

    (f)  Information.
      Each
      Buyer and its advisors (and his or, its counsel), if any, have been furnished
      with all materials relating to the business, finances and operations of the
      Company and information he deemed material to making an informed investment
      decision regarding his purchase of the Convertible Debentures and the underlying
      Units, which have been requested by such Buyer. Each Buyer and its advisors,
      if
      any, have been afforded the opportunity to ask questions of the Company and
      its
      management. Neither such inquiries nor any other due diligence investigations
      conducted by such Buyer or its advisors, if any, or its representatives shall
      modify, amend or affect such Buyer’s right to rely on the Company’s
      representations and warranties contained in Section 3 below. Each Buyer
      understands that its investment in the Convertible Debentures, and upon
      conversion the underlying Units involves a high degree of risk. Each Buyer
      is in
      a position regarding the Company, which, based upon employment, family
      relationship or economic bargaining power, enabled and enables such Buyer to
      obtain information from the Company in order to evaluate the merits and risks
      of
      this investment. Each Buyer has sought such accounting, legal and tax advice,
      as
      it has considered necessary to make an informed investment decision with respect
      to its acquisition of the Convertible Debentures.

     

    (g)  No
      Governmental Review.
      Each
      Buyer understands that no United States federal or state agency or any other
      government or governmental agency has passed on or made any recommendation
      or
      endorsement of the Convertible Debentures, the Warrants, the Warrant Shares
      or
      the Conversion Shares, or the fairness or suitability of the investment in
      the
      Convertible Debentures, the Warrants, the Warrant Shares or the Conversion
      Shares, nor have such authorities passed upon or endorsed the merits of the
      offering of the Convertible Debentures, the Warrants, the Warrant Shares or
      the
      Conversion Shares.

     

    (h)  Transfer
      or Resale.
      Each
      Buyer understands that: (i) the Convertible Debentures have not been and are
      not
      being registered under the Securities Act or any state 

     

     

    
      
        
        

      

      
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    securities
      laws, and may not be offered for sale, sold, assigned or transferred unless
      (A)
      subsequently registered thereunder, or (B) such Buyer shall have delivered
      to
      the Company an opinion of counsel, in a generally acceptable form, to the effect
      that such securities to be sold, assigned or transferred may be sold, assigned
      or transferred pursuant to an exemption from such registration requirements;
      (ii) any sale of such securities made in reliance on Rule 144 under the
      Securities Act (or a successor rule thereto) (“Rule 144”)
      may be
      made only in accordance with the terms of Rule 144 and further, if Rule 144
      is
      not applicable, any resale of such securities under circumstances in which
      the
      seller (or the person through whom the sale is made) may be deemed to be an
      underwriter (as that term is defined in the Securities Act) may require
      compliance with some other exemption under the Securities Act or the rules
      and
      regulations of the SEC thereunder; and (iii) neither the Company nor any other
      person is under any obligation to register such securities under the Securities
      Act or any state securities laws or to comply with the terms and conditions
      of
      any exemption thereunder. The Company reserves the right to place stop transfer
      instructions against the shares and certificates for the Conversion Shares
      and
      the Warrant Shares to the extent specifically set forth under this
      Agreement.

     

    (i)  Legends.
      Each
      Buyer understands that the certificates or other instruments representing the
      Convertible Debentures, the Warrants, the Warrant Shares and or the Conversion
      Shares shall bear a restrictive legend in substantially the following form
      (and
      a stop transfer order may be placed against transfer of such stock
      certificates):

     

    THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
      SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THESE SECURITIES MAY
      BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY,
      (B)
      OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER
      THE
      SECURITIES ACT, (C) IN COMPLIANCE WITH RULE 144 OR 144A THEREUNDER, IF
      AVAILABLE, AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, (D) PURSUANT
      TO AN EFFECTIVE REGISTRATION STATEMENT, OR (E) IN A TRANSACTION THAT DOES NOT
      REQUIRE REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
      LAWS, AND THE HOLDER HAS, PRIOR TO SUCH SALE, FURNISHED TO THE COMPANY AN
      OPINION OF COUNSEL OR OTHER EVIDENCE OF EXEMPTION, IN EITHER CASE REASONABLY
      SATISFACTORY TO THE COMPANY. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES
      MAY
      NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES
      ACT.

     

     

    
      
        
        

      

      
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    The
      legend set forth above shall be removed and the Company within three (3)
      business days shall issue a certificate without such legend to the holder of
      the
      Warrants, Warrant Shares and Conversion Shares upon which it is stamped, if,
      unless otherwise required by state securities laws, (i) the Buyer or its broker
      make the necessary representations and warranties to the transfer agent for
      the
      Common Stock that it has complied with the prospectus delivery requirements
      in
      connection with a sale transaction, provided the Convertible Debentures,
      Warrants, Warrant Shares and Conversion Shares are registered under the
      Securities Act or (ii) in connection with a sale transaction, after such holder
      provides the Company with an opinion of counsel satisfactory to the Company,
      which opinion shall be in form, substance and scope customary for opinions
      of
      counsel in comparable transactions, to the effect that a public sale, assignment
      or transfer of the Warrants, Warrant Shares and Conversion Shares may be made
      without registration under the Securities Act. 

     

    (j)  Authorization,
      Enforcement.
      This
      Agreement has been duly and validly authorized, executed and delivered on behalf
      of such Buyer and is a valid and binding agreement of such Buyer enforceable
      in
      accordance with its terms, except as such enforceability may be limited by
      general principles of equity or applicable bankruptcy, insolvency,
      reorganization, moratorium, liquidation and other similar laws relating to,
      or
      affecting generally, the enforcement of applicable creditors’ rights and
      remedies.

     

    (k)  Receipt
      of Documents.
      Each
      Buyer and his or its counsel has received and read in their entirety: (i) this
      Agreement and each representation, warranty and covenant set forth herein;
      (ii)
      all due diligence and other information necessary to verify the accuracy and
      completeness of such representations, warranties and covenants; and (iii) it
      has
      received answers to all questions each Buyer submitted to the Company regarding
      an investment in the Company; and each Buyer has relied on the information
      contained therein and has not been furnished any other documents, literature,
      memorandum or prospectus.

     

    (l)  Due
      Formation of Corporate and Other Buyers.
      If a
      Buyer is a corporation, trust, partnership or other entity that is not an
      individual person, it has been formed and validly exists and has not been
      organized for the specific purpose of purchasing the Convertible Debentures
      and
      is not prohibited from doing so.

     

    (m)  Trading
      Activities.
      The
      Buyer’s trading activities with respect to the Company’s Common Stock shall be
      in compliance with all applicable federal and state securities laws, rules
      and
      regulations and the rules and regulations of the principal market on which
      the
      Company’s Common Stock is listed or traded. Neither the Buyer nor its affiliates
      has an open short position in the Common Stock of the Company and, except as
      set
      forth below, the Buyer shall not, and shall not cause any of its affiliates
      under common control with the Buyer, to engage in any short sale as defined
      in
      any applicable SEC or National Association of Securities Dealers rules on any
      hedging transactions with respect to the Common Stock until the earlier to
      occur
      of (i) the third anniversary of the Closing Date and (ii) the Buyer(s) no longer
      own a principal balance of the Convertible Debentures. Without limiting the
      foregoing, the Buyer agrees not to engage in any naked short transactions in
      excess of the amount of shares owned (or an offsetting long position) by Buyer.
      

     

     

    
      
        
        

      

      
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    (n)  No
      Legal Advice From the Company.
      Each
      Buyer acknowledges that it had the opportunity to review this Agreement and
      the
      transactions contemplated by this Agreement with his or its own legal counsel
      and investment and tax advisors. Each Buyer is relying solely on such counsel
      and advisors and not on any statements or representations of the Company or
      any
      of its representatives or agents for legal, tax or investment advice with
      respect to this investment, the transactions contemplated by this Agreement
      or
      the securities laws of any jurisdiction. 

     

    (o)  No
      Group Participation.Each
      Buyer and its affiliates is not a member of any group, nor is any Buyer acting
      in concert with any other person, including any other Buyer, with respect to
      its
      acquisition of the Convertible Debentures, Warrants, the Warrant Shares or
      Conversion Shares.

     

    (p)  Each
      Buyer understands, acknowledges and agrees that the Conversion Shares and the
      Warrant Shares are “restricted securities” within the meaning of Rule 144
      promulgated under the Act. Each Buyer further understands, acknowledges and
      agrees that (a) such shares can and will only be resold by the Buyer pursuant
      to
      (i) an effective registration statement under the Act where the prospectus
      delivery requirements are complied with or (ii) under an applicable exemption
      from registration under the Act, and (b) it will not sell or otherwise dispose
      of or transfer the Conversion Shares or the Warrant Shares or any interest
      therein in a transaction that is part of a plan or scheme to avoid the
      registration requirements of the Act. 

     

    (q)  Each
      Buyer understands that the Company, its officers, directors and agents are
      relying on the representations of the Buyers set forth in this Article 2 in
      order to determine compliance with applicable securities laws in connection
      with
      the sale and issuance of the shares to the Buyer.

     

    3.  REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY.

     

    The
      Company represents and warrants to each of the Buyers that:

     

    (a)  Organization
      and Qualification.
      The
      Company and its subsidiaries are corporations duly organized and validly
      existing in good standing under the laws of the jurisdiction in which they
      are
      incorporated, and have the requisite corporate power to own their properties
      and
      to carry on their business as now being conducted. Each of the Company and
      its
      subsidiaries is duly qualified as a foreign corporation to do business and
      is in
      good standing in every jurisdiction in which the nature of the business
      conducted by it makes such qualification necessary, except to the extent that
      the failure to be so qualified or be in good standing would not have a Material
      Adverse Effect, as defined below.

     

    (b)  Authorization,
      Enforcement, Compliance with Other Instruments.
      (i) The Company has the requisite corporate power and authority to enter
      into and perform this Agreement and all other documents necessary or desirable
      to effect the transactions contemplated hereby (collectively the “Transaction
      Documents”) and to issue the Convertible Debentures, the Warrants, the Warrant
      Shares and the Conversion Shares in accordance with the terms hereof and
      thereof, (ii) the execution and delivery of the Transaction Documents by the
      

     

     

    
      
        
        

      

      
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    Company
      and the consummation by it of the transactions contemplated hereby and thereby,
      including, without limitation, the issuance of the Convertible Debentures,
      the
      Warrants, the Warrant Shares and the Conversion Shares and the reservation
      for
      issuance and the issuance of the Conversion Shares and the Warrant Shares
      issuable upon conversion or exercise thereof, have been duly authorized by
      the
      Company’s Board of Directors and no further consent or authorization is required
      by the Company, its Board of Directors or its stockholders, (iii) the
      Transaction Documents have been duly executed and delivered by the Company,
      (iv)
      the Transaction Documents constitute the valid and binding obligations of the
      Company enforceable against the Company in accordance with their terms, except
      as such enforceability may be limited by general principles of equity or
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally, the enforcement of creditors’
rights and remedies. 

     

    (c)  Capitalization.
      The
      authorized capital stock of the Company consists of 75,000,000 shares of Common
      Stock. After giving effect to the Recapitalization, the authorized capital
      stock
      of the Company will consist of 300,000,000 shares of Common Stock and 10,000,000
      shares of Preferred Stock. As of the date hereof, the Company has 10,780,000
      shares of Common Stock issued and outstanding (approximately 68,453,000 shares
      of Common Stock, after giving effect to the Stock Split) and 0 shares of
      preferred stock outstanding. All of such outstanding shares have been duly
      authorized, validly issued and are fully paid and nonassessable. No shares
      of
      Common Stock are subject to preemptive rights or any other similar rights or
      any
      liens or encumbrances suffered or permitted by the Company. As of the date
      of
      this Agreement, (i) there are no outstanding options, warrants, scrip, rights
      to
      subscribe to, calls or commitments of any character whatsoever relating to,
      or
      securities or rights convertible into, any shares of capital stock of the
      Company or any of its subsidiaries, or contracts, commitments, understandings
      or
      arrangements by which the Company or any of its subsidiaries is or may become
      bound to issue additional shares of capital stock of the Company or any of
      its
      subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
      commitments of any character whatsoever relating to, or securities or rights
      convertible into, any shares of capital stock of the Company or any of its
      subsidiaries, (ii) there are no outstanding debt securities and (iii) there
      are
      no agreements or arrangements under which the Company or any of its subsidiaries
      is obligated to register the sale of any of their securities under the
      Securities Act (except in connection with the Merger and the PPO), and (iv)
      there are no outstanding registration statements and there are no outstanding
      comment letters from the SEC or any other regulatory agency. There are no
      securities or instruments containing anti-dilution or similar provisions that
      will be triggered by the issuance of the Convertible Debentures as described
      in
      this Agreement. The Convertible Debentures, Warrants, Warrant Shares and
      Conversion Shares when issued, will be free and clear of all pledges, liens,
      encumbrances and other restrictions (other than those arising under federal
      or
      state securities laws as a result of the issuance of the Convertible
      Debentures). No co-sale right, right of first refusal or other similar right
      exists with respect to the Convertible Debentures, Warrants, Warrant Shares
      and
      the Conversion Shares or the issuance and sale thereof. The issue and sale
      of
      the Convertible Debentures, Warrants, Warrant Shares and the Conversion Shares
      will not result in a right of any holder of Company securities to adjust the
      exercise, conversion, exchange or reset price under such securities. The Company
      has made available to the Buyer true and correct copies of the Company’s
      Certificate of Incorporation, as amended and as in effect on the date hereof
      (the “Certificate of Incorporation”), and the Company’s By-laws, as in effect on
      the date hereof (the “By-laws”), and the terms of all 

     

     

    
      
        
        

      

      
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    securities
      convertible into or exercisable for Common Stock and the material rights of
      the
      holders thereof in respect thereto other than stock options issued to employees
      and consultants. 

     

    (d)  Issuance
      of Securities.
      The
      Convertible Debentures are duly authorized and, upon issuance in accordance
      with
      the terms hereof, shall be duly issued, fully paid and nonassessable, are free
      from all taxes, liens and charges with respect to the issue thereof. The
      Conversion Shares and the Warrant Shares have been duly authorized and reserved
      for issuance, based on the initial conversion price. Upon conversion or exercise
      in accordance with the Transaction Documents, the Conversion Shares and the
      Warrant Shares will be duly issued, fully paid and nonassessable.

     

    (e)  No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company
      and the consummation by the Company of the transactions contemplated hereby
      will
      not (i) result in a violation of the Certificate of Incorporation, any
      certificate of designations of any outstanding series of preferred stock of
      the
      Company or the By-laws or (ii) conflict with or constitute a default (or an
      event which with notice or lapse of time or both would become a default) under,
      or give to others any rights of termination, amendment, acceleration or
      cancellation of, any agreement, indenture or instrument to which the Company
      or
      any of its subsidiaries is a party, or result in a violation of any law, rule,
      regulation, order, judgment or decree (including federal and state securities
      laws and regulations and the rules and regulations of The National Association
      of Securities Dealers Inc.’s OTC Bulletin Board (the “OTC”) on which the Common
      Stock is quoted) applicable to the Company or any of its subsidiaries or by
      which any property or asset of the Company or any of its subsidiaries is bound
      or affected except for those which could not reasonably be expected to have
      a
      material adverse effect on the assets, business, condition (financial or
      otherwise), results of operations or future prospects of the Company and its
      subsidiaries taken as a whole (a “Material Adverse Effect”). Except those which
      could not reasonably be expected to have a material adverse effect on the
      Company, neither the Company nor its subsidiaries is in violation of any term
      of
      or in default under its Certificate of Incorporation or By-laws or their
      organizational charter or by-laws, respectively, or any material contract,
      agreement, mortgage, indebtedness, indenture, instrument, judgment, decree
      or
      order or any statute, rule or regulation applicable to the Company or its
      subsidiaries. The business of the Company and its subsidiaries is not being
      conducted, and shall not be conducted in violation of any material law,
      ordinance, or regulation of any governmental entity. Except as specifically
      contemplated by this Agreement and as required under the Securities Act and
      any
      applicable state securities laws, the Company is not required to obtain any
      consent, authorization or order of, or make any filing or registration with,
      any
      court or governmental agency in order for it to execute, deliver or perform
      any
      of its obligations under or contemplated by this Agreement or the other
      Transaction Documents in accordance with the terms hereof or thereof. All
      consents, authorizations, orders, filings and registrations which the Company
      is
      required to obtain pursuant to the preceding sentence have been obtained or
      effected on or prior to the date hereof. The Company and its subsidiaries are
      unaware of any facts or circumstance, which might give rise to any of the
      foregoing.

     

    (f)  Financial
      Statements.
      As of
      their respective dates, the financial statements of the Company included in
      the
      Company’s public filings (the “SEC Filings”) with the SEC (the “Financial
      Statements”) for the two most recently completed fiscal years and any subsequent
      interim period complied as to form in all material respects with applicable
      accounting 

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    requirements
      and the published rules and regulations of the SEC with respect thereto. Such
      financial statements have been prepared in accordance with generally accepted
      accounting principles, consistently applied, during the periods involved (except
      (i) as may be otherwise indicated in such Financial Statements or the notes
      thereto, or (ii) in the case of unaudited interim statements, to the extent
      they
      may exclude footnotes or may be condensed or summary statements) and, fairly
      present in all material respects the financial position of the Company as of
      the
      dates thereof and the results of its operations and cash flows for the periods
      then ended (subject, in the case of unaudited statements, to normal year-end
      audit adjustments). No other information provided by or on behalf of the Company
      to the Buyer including, without limitation, information referred to in this
      Agreement, contains any untrue statement of a material fact or omits to state
      any material fact necessary in order to make the statements therein, in the
      light of the circumstances under which they were made, not
      misleading.

     

    (g)  Absence
      of Litigation.
      There
      is no action, suit, proceeding, inquiry or investigation before or by any court,
      public board, government agency, self-regulatory organization or body pending
      against or affecting the Company, the Common Stock or any of the Company’s
      subsidiaries, wherein an unfavorable decision, ruling or finding would (i)
      adversely affect the validity or enforceability of, or the authority or ability
      of the Company to perform its obligations under, this Agreement or any of the
      documents contemplated herein, or (ii) have a Material Adverse
      Effect.

     

    (h)  Acknowledgment
      Regarding Buyer’s Purchase of the Convertible Debentures.
      The
      Company acknowledges and agrees that each Buyer is acting solely in the capacity
      of an arm’s length purchaser with respect to this Agreement and the transactions
      contemplated hereby. The Company further acknowledges that each Buyer is not
      acting as a financial advisor or fiduciary of the Company (or in any similar
      capacity) with respect to this Agreement and the transactions contemplated
      hereby and any advice given by such Buyer or any of their respective
      representatives or agents in connection with this Agreement and the transactions
      contemplated hereby is merely incidental to such Buyer’s purchase of the
      Convertible Debentures, the Warrants, the Warrant Shares or the Conversion
      Shares. The Company further represents to the Buyers that the Company’s decision
      to enter into this Agreement has been based solely on the independent evaluation
      by the Company and its representatives.

     

    (i)  No
      General Solicitation.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf, has engaged in any form of general solicitation or general advertising
      (within the meaning of Regulation D) in connection with the offer or sale of
      the
      Convertible Debentures, the Warrants, the Warrant Shares or the Conversion
      Shares.

     

    (j)  No
      Integrated Offering.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf has, directly or indirectly, made any offers or sales of any security
      or
      solicited any offers to buy any security, under circumstances that would require
      registration of the Convertible Debentures, the Warrants, the Warrant Shares
      or
      the Conversion Shares under the Securities Act or cause this offering of the
      Convertible Debentures, the Warrants, the Warrant Shares or the Conversion
      Shares to be integrated with prior offerings by the Company for purposes of
      the
      Securities Act.

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (k)  Employee
      Relations.
      Neither
      the Company nor any of its subsidiaries is involved in any labor dispute nor,
      to
      the knowledge of the Company or any of its subsidiaries, is any such dispute
      threatened. None of the Company’s or its subsidiaries’ employees is a member of
      a union and the Company and its subsidiaries believe that their relations with
      their employees are good.

     

    (l)  Intellectual
      Property Rights.
      The
      Company has no proprietary intellectual property.

     

    (m)  Environmental
      Laws.
      

     

    (i)  Each
      of
      the Company and its subsidiaries has complied with all applicable Environmental
      Laws (as defined below), except for violations of Environmental Laws that,
      individually or in the aggregate, have not had and would not reasonably be
      expected to have a Material Adverse Effect. There is no pending or, to the
      knowledge of the Company, threatened civil or criminal litigation, written
      notice of violation, formal administrative proceeding, or investigation, inquiry
      or information request, relating to any Environmental Law involving the Company
      or any subsidiary, except for litigation, notices of violations, formal
      administrative proceedings or investigations, inquiries or information requests
      that, individually or in the aggregate, have not had and would not reasonably
      be
      expected to have a Material Adverse Effect. For purposes of this Agreement,
      “Environmental Law” means any federal, state or local law, statute, rule or
      regulation or the common law relating to the environment or occupational health
      and safety, including without limitation any statute, regulation, administrative
      decision or order pertaining to (i) treatment, storage, disposal, generation
      and
      transportation of industrial, toxic or hazardous materials or substances or
      solid or hazardous waste; (ii) air, water and noise pollution; (iii) groundwater
      and soil contamination; (iv) the release or threatened release into the
      environment of industrial, toxic or hazardous materials or substances, or solid
      or hazardous waste, including without limitation emissions, discharges,
      injections, spills, escapes or dumping of pollutants, contaminants or chemicals;
      (v) the protection of wild life, marine life and wetlands, including without
      limitation all endangered and threatened species; (vi) storage tanks, vessels,
      containers, abandoned or discarded barrels, and other closed receptacles; (vii)
      health and safety of employees and other persons; and (viii) manufacturing,
      processing, using, distributing, treating, storing, disposing, transporting
      or
      handling of materials regulated under any law as pollutants, contaminants,
      toxic
      or hazardous materials or substances or oil or petroleum products or solid
      or
      hazardous waste. As used above, the terms “release” and “environment” shall have
      the meaning set forth in the Comprehensive Environmental Response, Compensation
      and Liability Act of 1980, as amended (“CERCLA”).

     

    (ii)  To
      the
      knowledge of the Company there is no material environmental liability with
      respect to any solid or hazardous waste transporter or treatment, storage or
      disposal facility that has been used by the Company or any
      subsidiary.

     

    (iii)  The
      Company and its subsidiaries (i) have received all permits, licenses or other
      approvals required of them under applicable Environmental Laws to conduct their
      respective businesses and (ii) are in compliance with all terms and conditions
      of any such permit, license or approval.

     

     

    
      
        
        

      

      
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    (n)  Title.
      The
      Company does not own or lease any real or personal property.

     

    (o)  Internal
      Accounting Controls.
      The
      Company and each of its subsidiaries maintain a system of internal accounting
      controls sufficient to provide reasonable assurance that (i) transactions are
      executed in accordance with management’s general or specific authorizations,
      (ii) transactions are recorded as necessary to permit preparation of financial
      statements in conformity with generally accepted accounting principles and
      to
      maintain asset accountability, and (iii) the recorded amounts for assets is
      compared with the existing assets at reasonable intervals and appropriate action
      is taken with respect to any differences.

     

    (p)  No
      Material Adverse Breaches, etc.
      Except
      as set forth in the SEC Filings, neither the Company nor any of its subsidiaries
      is subject to any charter, corporate or other legal restriction, or any
      judgment, decree, order, rule or regulation which in the judgment of the
      Company’s officers has or is expected in the future to have a Material Adverse
      Effect. Except as set forth in the SEC Filings, neither the Company nor any
      of
      its subsidiaries is in breach of any contract or agreement which breach, in
      the
      judgment of the Company’s officers, has or is expected to have a Material
      Adverse Effect.

     

    (q)  Tax
      Status.
      The
      Company and each of its subsidiaries has made and filed all federal and state
      income and all other tax returns, reports and declarations required by any
      jurisdiction to which it is subject and (unless and only to the extent that
      the
      Company and each of its subsidiaries has set aside on its books provisions
      reasonably adequate for the payment of all unpaid and unreported taxes) has
      paid
      all taxes and other governmental assessments and charges that are material
      in
      amount, shown or determined to be due on such returns, reports and declarations,
      except those being contested in good faith and has set aside on its books
      provision reasonably adequate for the payment of all taxes for periods
      subsequent to the periods to which such returns, reports or declarations apply.
      There are no unpaid taxes in any material amount claimed to be due by the taxing
      authority of any jurisdiction, and the officers of the Company know of no basis
      for any such claim.

     

    (r)  Certain
      Transactions.
      Except
      as set forth in the SEC Filings, and except for arm’s length transactions
      pursuant to which the Company makes payments in the ordinary course of business
      upon terms no less favorable than the Company could obtain from third parties,
      none of the officers, directors, or employees of the Company is presently a
      party to any transaction with the Company (other than for services as employees,
      officers and directors), including any contract, agreement or other arrangement
      providing for the furnishing of services to or by, providing for rental of
      real
      or personal property to or from, or otherwise requiring payments to or from
      any
      officer, director or such employee or, to the knowledge of the Company, any
      corporation, partnership, trust or other entity in which any officer, director,
      or any such employee has a substantial interest or is an officer, director,
      trustee or partner.

     

    (s)  Fees
      and Rights of First Refusal.
      The
      Company is not obligated to offer the securities offered hereunder on a right
      of
      first refusal basis or otherwise to any third parties including, but not limited
      to, current or former stockholders of the Company, underwriters, brokers, agents
      or other third parties.

     

     

    
      
        
        

      

      
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    (t)  Reliance.
      The
      Company acknowledges that the Buyers are relying on the representations and
      warranties made by the Company hereunder and that such representations and
      warranties are a material inducement to the Buyer purchasing the Convertible
      Debentures. The Company further acknowledges that without such representations
      and warranties of the Company made hereunder, the Buyers would not enter into
      this Agreement.

     

    (u)  Anti-Takeover
      Provision.
      The
      Company and its Board of Directors have taken all necessary action, if any,
      in
      order to render inapplicable any control share acquisition, business
      combination, poison pill (including any distribution under a rights agreement)
      or other similar anti-takeover provision under the Company’s certificate of
      incorporation (or similar charter documents) or the laws of its jurisdiction
      of
      incorporation that is or could become applicable to the Buyers as a result
      of
      the Buyers and the Company fulfilling their obligations or exercising their
      rights under this Agreement, including without limitation the Company’s issuance
      of the Convertible Debentures, Warrants, Warrant Shares and Conversion Shares
      and the Buyer’s ownership thereof.

     

    4.  COVENANTS.

     

    (a)  Best
      Efforts.
      Each
      party shall use its best efforts timely to satisfy each of the conditions to
      be
      satisfied by it as provided in Sections 5 and 6 of this Agreement.

     

    (b)  Form
      D.
      The
      Company agrees to file a Form D with respect to the Convertible Debentures
      as
      required under Regulation D. The Company shall, on or before the Closing Date,
      take such action as the Company shall reasonably determine is necessary to
      qualify the Convertible Debentures, Warrants, the Warrant Shares and Conversion
      Shares, or obtain an exemption for the Convertible Debentures, Warrants, the
      Warrant Shares and Conversion Shares for sale to the Buyers at the Closing
      pursuant to this Agreement under applicable securities or “Blue Sky” laws of the
      states of the United States, and shall provide evidence of any such action
      so
      taken to the Buyers on or prior to the Closing Date.

     

    (c)  Reporting
      Status.
      Until
      the earlier of (i) the date as of which the Buyer(s) may sell all of the
      Warrants, the Warrant Shares, and Conversion Shares without restriction pursuant
      to Rule 144(k) promulgated under the Securities Act (or successor thereto),
      or
      (ii) the date on which (A) the Buyer(s) shall have sold all the Warrants, the
      Warrant Shares and Conversion Shares and (B) none of the Convertible Debentures
      are outstanding, the Company shall file in a timely manner all reports required
      to be filed with the SEC pursuant to the Securities Exchange Act of 1934, as
      amended (the “Exchange Act”) and the regulations of the SEC thereunder, and the
      Company shall not terminate its status as an issuer required to file reports
      under the Exchange Act even if the Exchange Act or the rules and regulations
      thereunder would otherwise permit such termination.

     

    (d)  Use
      of
      Proceeds.
      The
      Company shall use the proceeds from the sale of the Convertible Debentures
      to
      make the Bridge Loan to Cromwell. 

     

    (e)  Reservation
      of Shares.
      The
      Company shall take all action reasonably necessary to at all times have
      authorized, and reserved for the purpose of issuance, that number of shares
      of
      Common Stock equal to equal to the sum of (i) the number of shares of

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    Common
      Stock into which the Convertible Debentures are convertible from time to time
      based upon a conversion price (the “Conversion Price”) of $0.50 per Unit, plus
      (ii) the number of shares of Common Stock for which the Warrants are exercisable
      from time to time based upon an exercise price (the “Exercise Price”) per whole
      Warrant of $0.75 per share.

     

    (f)  Listings
      or Quotation.
      The
      Company shall use its best efforts to maintain the listing or quotation of
      its
      Common Stock upon the OTCBB.

     

    (g)  Corporate
      Existence.
      So long
      as any of the Convertible Debentures remain outstanding, the Company shall
      not
      directly or indirectly consummate any merger, reorganization, restructuring,
      reverse stock split consolidation, sale of all or substantially all of the
      Company’s assets or any similar transaction or related transactions (each such
      transaction, an “Organizational Change”), other than the Recapitalization and
      the Stock Split, unless, prior to the consummation of an Organizational Change,
      the Company obtains the written consent of each Buyer. In any such case, the
      Company will make appropriate provision with respect to such holders’ rights and
      interests to insure that the provisions of this Section 4(i) will thereafter
      be
      applicable to the Convertible Debentures. The provisions of this Section 4(g)
      shall be inapplicable with respect to any Organizational Change, including
      the
      Recapitalization and the Stock Split, effected in connection with the
      Merger.

     

    (h)  Resales
      Absent Effective Registration Statement.
      Each of the Buyers understand and acknowledge that (i) this Agreement and the
      agreements contemplated hereby may require the Company to issue and deliver
      Conversion Shares or Warrant Shares to the Buyers with legend restricting their
      transferability under the Securities Act, and (ii) it is aware that resales
      of
      such Conversion Shares or Warrant Shares may not be made unless, at the time
      of
      resale, there is an effective registration statement under the Securities Act
      covering such Buyer’s resale(s) or an applicable exemption from registration.

     

    5.  CONDITIONS
      TO THE COMPANY’S OBLIGATION TO SELL.

     

    The
      obligation of the Company hereunder to issue and sell the Convertible Debentures
      to the Buyer(s) at the Closing is subject to the satisfaction, at or before
      the
      Closing Date, of each of the following conditions, provided that these
      conditions are for the Company’s sole benefit and may be waived by the Company
      at any time in its sole discretion:

     

    (a)  Each
      Buyer shall have executed the Transaction Documents and delivered them to the
      Company.

     

    (b)  The
      Buyer(s) shall have delivered to the Escrow Agent the Purchase Price for
      Convertible Debentures in respective amounts as set forth next to each Buyer
      as
      outlined on Schedule I attached hereto and the Escrow Agent shall have delivered
      the net proceeds to the Company by wire transfer of immediately available U.S.
      funds pursuant to the wire instructions provided by the Company; it being
      understood that the sale of the Convertible Debentures shall not close unless
      a
      minimum of $420,000 principal amount of Convertible Debentures is subscribed
      for.

     

    (c)  The
      representations and warranties of the Buyer(s) contained in this Agreement
      shall
      be true and correct in all material respects as 

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    of
      the
      date when made and as of the Closing Date as though made at that time (except
      for representations and warranties that speak as of a specific date), and the
      Buyer(s) shall have performed, satisfied and complied in all material respects
      with the covenants, agreements and conditions required by this Agreement to
      be
      performed, satisfied or complied with by the Buyer(s) at or prior to the Closing
      Date.

     

    6.  CONDITIONS
      TO THE BUYER’S OBLIGATION TO PURCHASE.

     

    The
      obligation of the Buyer(s) hereunder to purchase the Convertible Debentures
      at
      the Closing is subject to the satisfaction, at or before the Closing Date,
      of
      each of the following conditions:

     

    (i)  The
      Company shall have executed the Transaction Documents and delivered the same
      to
      the Buyer(s).

     

    (ii)  The
      representations and warranties of the Company contained in this Agreement shall
      be true and correct in all material respects (except to the extent that any
      of
      such representations and warranties is already qualified as to materiality
      in
      Section 3 above, in which case, such representations and warranties shall be
      true and correct without further qualification) as of the date when made and
      as
      of the Closing Date as though made at that time (except for representations
      and
      warranties that speak as of a specific date) and the Company shall have
      performed, satisfied and complied in all material respects with the covenants,
      agreements and conditions required by this Agreement to be performed, satisfied
      or complied with by the Company at or prior to the Closing Date. If requested
      by
      the Buyer, the Buyer shall have received a certificate, executed by the
      President of the Company, dated as of the Closing Date, to the foregoing effect
      and as to such other matters as may be reasonably requested by the Buyer
      including, without limitation an update as of the Closing Date regarding the
      representation contained in Section 3(c) above.

     

    (iii)  The
      Company shall have executed and delivered to the Buyer(s) the Convertible
      Debentures in the respective amounts set forth opposite each Buyer(s) name
      on
      Schedule I attached hereto.

     

    (iv)  The
      Company shall have provided to the Buyer a certificate of good standing from
      the
      Secretary of State from the state in which the Company is
      incorporated.

     

    (v)  The
      Company shall have reserved out of its authorized and unissued Common Stock,
      solely for the purpose of effecting the conversion of the Convertible
      Debentures, sufficient shares of Common Stock to effect the conversion of all
      of
      the Convertible Debentures’ and the exercise of all Warrants. 

     

    7.  INDEMNIFICATION.

     

    (a)  In
      consideration of the Buyer’s execution and delivery of this Agreement and
      acquiring the Convertible Debentures, the Warrants and the Conversion Shares
      hereunder, and in addition to all of the Company’s other obligations under this
      Agreement, the Company shall defend, protect, indemnify and hold harmless the
      Buyer(s) and each other holder of the Convertible Debentures, the Warrants
      and
      the Conversion Shares, and all of their officers, 

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    directors,
      employees and agents (including, without limitation, those retained in
      connection with the transactions contemplated by this Agreement) (collectively,
      the “Buyer Indemnitees”) from and against any and all actions, causes of action,
      suits, claims, losses, costs, penalties, fees, liabilities and damages, and
      expenses in connection therewith (irrespective of whether any such Buyer
      Indemnitee is a party to the action for which indemnification hereunder is
      sought), and including reasonable attorneys’ fees and disbursements (the
“Indemnified Liabilities”), incurred by the Buyer Indemnitees or any of them as
      a result of, or arising out of, or relating to (a) any material
      misrepresentation or material breach of any representation or warranty made
      by
      the Company in the Transaction Documents, (b) any material breach of any
      covenant, agreement or obligation of the Company contained in the Transaction
      Documents, or (c) any cause of action, suit or claim brought or made against
      such Indemnitee and arising out of or resulting from the execution, delivery,
      performance or enforcement of this Agreement or any other Transaction Document
      executed pursuant hereto by any of the Indemnities. To the extent that the
      foregoing undertaking by the Company may be unenforceable for any reason, the
      Company shall make the maximum contribution to the payment and satisfaction
      of
      each of the Indemnified Liabilities, which is permissible under applicable
      law.

     

    (b)  In
      consideration of the Company’s execution and delivery of this Agreement, and in
      addition to all of the Buyer’s other obligations under this Agreement, the Buyer
      shall defend, protect, indemnify and hold harmless the Company and all of its
      officers, directors, employees and agents (including, without limitation, those
      retained in connection with the transactions contemplated by this Agreement)
      (collectively, the “Company Indemnitees”) from and against any and all
      Indemnified Liabilities incurred by the Company Indemnitees or any of them
      as a
      result of, or arising out of, or relating to (a) any misrepresentation or breach
      of any representation or warranty made by the Buyer(s) in this Agreement, or
      any
      other Transaction Document executed by the Buyer, (b) any breach of any
      covenant, agreement or obligation of the Buyer(s) contained in this Agreement,
      or any other Transaction Document executed by the Buyer, or (c) any cause of
      action, suit or claim brought or made against such Company Indemnitee based
      on
      material misrepresentations or due to a material breach and arising out of
      or
      resulting from the execution, delivery, performance or enforcement of the
      Transaction Docuemtns by any of the Buyers. To the extent that the foregoing
      undertaking by each Buyer may be unenforceable for any reason, each Buyer shall
      make the maximum contribution to the payment and satisfaction of each of the
      Indemnified Liabilities, which is permissible under applicable law.

     

    8.  ESCROW

     

    (a)  On
      or
      before the date of the Closing, each Buyer shall have delivered to the Escrow
      Agent its portion of the purchase price for the Convertible Debentures (the
      aggregate of purchase price referred to as the “Escrowed Funds”) and the
      Transaction Documents. The parties shall ensure that each Buyer’s portion of the
      Escrowed Funds will be delivered to the Escrow Agent pursuant to the following
      wire transfer instructions:

     

    

    
      
        
        

      

      
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    BANK:
      CITIBANK, N.A., 330 Madison Avenue, New York, New York 

    

    ABA:
      021000089

    

    BENEFICIARY:
      Gottbetter & Partners, LLP, Attorney Trust Account

    

    ACCOUNT:
      49061322

    

    REFERENCE:
      “Arbutus Resources, Inc. - [insert Buyer’s name]”

    

    Gottbetter
      & Partners Accounting Contact: Vincent DiPaola; telephone: (212) 400-6900;
      email: vdp@gottbetter.com.

    

    (b)  The
      Company intends that the Transaction Documents and the Escrowed Funds shall
      be
      held in escrow by the Escrow Agent pursuant to this Agreement for their benefit
      and for the benefit of the Buyers as set forth herein.

     

    (c)  The
      Escrow Agent shall hold and release the Transaction Documents and the Escrowed
      Funds only in accordance with the terms and conditions of this Article
      8.

     

    (d)  Subject
      to the provisions of Section 8(f), the Escrow Agent shall release the
      Transaction Documents and Escrowed Funds as follows:

     

    (i)  On
      the
      Closing Date, the Escrow Agent will release the Transaction Documents to the
      Company and the Escrowed Funds to or for the benefit of the Company except
      that
      the legal fees and expenses owed to Gottbetter & Partners, LLP as counsel to
      the Company shall be deducted from the Escrowed Funds and released to Gottbetter
      & Partners, LLP.

     

    (ii)  All
      funds
      to be delivered to the Company shall be delivered pursuant to written
      instructions substantially in the form of Exhibit A hereto (the “Instructions”)
      signed by the Company.

     

    (iii)  Notwithstanding
      the above, upon receipt by the Escrow Agent of the Instructions, the Escrow
      Agent shall deliver the Transaction Documents and the Escrowed Funds in
      accordance with the terms of the Instructions; provided,
      however,
      that in
      the event of any conflict between such Instructions and the provisions of
      Section 8(d)(i) of this Agreement, the provisions of Section 8(d)(i) shall
      control.

     

    (iv)  Notwithstanding
      the above, upon receipt by the Escrow Agent of a final and non-appealable
      judgment, order, decree or award of a court of competent jurisdiction (a “Court
      Order”), the Escrow Agent shall deliver the Transaction Documents and the
      Escrowed Funds in accordance with the Court Order. Any Court Order shall be
      accompanied by an opinion of counsel for the party presenting the Court Order
      to
      the Escrow Agent (which opinion shall be satisfactory to the Escrow Agent)
      to
      the effect that the court issuing the Court Order has competent jurisdiction
      and
      that the Court Order is final and non-appealable.

     

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    (v)  In
      the
      event Transaction Documents for an aggregate purchase price of not less than
      the
      Minimum of $420,000 and corresponding Escrowed Funds for an aggregate of not
      less than such Minimum of $420,000 have not been received by the Escrow Agent
      on
      or before the Termination Date, then the Escrow Agent shall release the
      Transaction Documents and the Escrowed Funds to the Buyers as soon as reasonably
      possible.

     

    (vi)  The
      Company acknowledges that the only terms and conditions upon which the
      Transaction Documents and Escrowed Funds are to be released are set forth in
      this Article 8. The Company reaffirms its agreement to abide by the terms and
      conditions of this Agreement with respect to the release of the Transaction
      Documents and the Escrowed Funds. Any dispute with respect to the release of
      the
      Transaction Documents or Escrowed Funds shall be resolved pursuant to Section
      8(f) or by agreement between the parties.

     

    (e)  The
      Escrow Agent’s duties and responsibilities shall be subject to the following
      terms and conditions:

     

    (i)  The
      Company and the Buyers acknowledge and agree that the Escrow Agent (i) shall
      not
      be responsible for or bound by, and shall not be required to inquire into
      whether either the Company or the Buyers are entitled to receipt of the
      Transaction Documents or Escrowed Funds pursuant to, any other agreement or
      otherwise; (ii) shall be obligated only for the performance of such duties
      as
      are specifically assumed by the Escrow Agent pursuant to this Agreement; (iii)
      may rely on and shall be protected in acting or refraining from acting upon
      any
      written notice, instruction, instrument, statement, request or document
      furnished to it hereunder and believed by the Escrow Agent in good faith to
      be
      genuine and to have been signed or presented by the proper person or party,
      without being required to determine the authenticity or correctness of any
      fact
      stated therein or the propriety or validity or the service thereof; (iv) may
      assume that any person believed by the Escrow Agent in good faith to be
      authorized to give notice or make any statement or execute any document in
      connection with the provisions hereof is so authorized; (v) shall not be under
      any duty to give the property held by Escrow Agent hereunder any greater degree
      of care than the Escrow Agent gives its own similar property, but in no event
      less than a reasonable amount of care; and (vi) may consult with counsel
      satisfactory to the Escrow Agent, the opinion of such counsel to be full and
      complete authorization and protection in respect of any action taken, suffered
      or omitted by the Escrow Agent hereunder in good faith and in accordance with
      the opinion of such counsel.

     

    (ii)  The
      Company and the buyers acknowledge that the Escrow Agent is acting solely as
      a
      stakeholder at their request and that the Escrow Agent shall not be liable
      for
      any action taken by Escrow Agent in good faith and believed by the Escrow Agent
      to be authorized or within the rights or powers conferred upon the Escrow Agent
      by this Agreement. The Company agrees to indemnify and hold harmless the Escrow
      Agent and any of the Escrow Agent’s partners, employees, agents, and
      representatives for any action taken or omitted to be taken by the Escrow Agent
      or any of them hereunder, including the fees of outside counsel and other costs
      and expenses of defending itself against any claim or liability under this
      Agreement, except in the case of gross negligence or willful misconduct on
      the
      part of the Escrow Agent committed in its capacity as Escrow Agent under this
      Agreement. The Escrow Agent shall owe a duty only to the Company and the Buyers
      under this Agreement and to no other person.

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    (iii)  The
      Company agrees to reimburse the Escrow Agent for outside counsel fees, to the
      extent authorized hereunder and incurred in connection with the performance
      of
      its duties and responsibilities hereunder.

     

    (iv)  The
      Escrow Agent may at any time resign as Escrow Agent hereunder by giving five
      (5)
      days prior written notice of resignation to the Company. Prior to the effective
      date of the resignation as specified in such notice, the Company will issue
      to
      the Escrow Agent an Instruction authorizing delivery of the Transaction
      Documents and the Escrowed Funds to a substitute escrow agent selected by the
      Company. If no successor escrow agent is named by the Company, the Escrow Agent
      may apply to a court of competent jurisdiction in the State of New York for
      appointment of a successor escrow agent, and to deposit the Transaction
      Documents and Escrowed Funds with the clerk of any such court.

     

    (v)  The
      Escrow Agent does not have and will not have any interest in the Transaction
      Documents or the Escrowed Funds, but is serving only as escrow agent in
      connection therewith, having only possession thereof.

     

    (vi)  This
      Agreement sets forth exclusively the duties of the Escrow Agent with respect
      to
      any and all matters pertinent thereto and no implied duties or obligations
      shall
      be read into this Agreement.

     

    (vii)  The
      provisions of this Section 8(e) shall survive the resignation of the Escrow
      Agent or the termination of this Agreement.

     

    (f)  Resolution
      of disputes arising under this Article 8 shall be subject to the following
      terms
      and conditions:

     

    (i)  If
      any
      dispute shall arise with respect to the delivery, ownership, right of possession
      or disposition of the Transaction Documents or the Escrowed Funds, or if the
      Escrow Agent shall in good faith be uncertain as to its duties or rights
      hereunder, the Escrow Agent shall be authorized, without liability to anyone,
      to
      (i) refrain from taking any action other than to continue to hold the
      Transaction Documents or the Escrowed Funds pending receipt of an Instruction
      from the Company, or (ii) deposit the Transaction Documents and Escrowed Funds
      with any court of competent jurisdiction in the State of New York, in which
      event the Escrow Agent shall give written notice thereof to the Company and
      shall thereupon be relieved and discharged from all further obligations pursuant
      to this Agreement. The Escrow Agent may, but shall be under no duty to,
      institute or defend any legal proceedings which relate to the Transaction
      Documents or the Escrowed Funds. The Escrow Agent shall have the right to retain
      counsel if it becomes involved in any disagreement, dispute or litigation on
      account of this Agreement or otherwise determines that it is necessary to
      consult counsel.

     

    (ii)  The
      Escrow Agent is hereby expressly authorized to comply with and obey any Court
      Order. In case the Escrow Agent obeys or complies with a Court Order, the Escrow
      Agent shall not be liable to the Buyers, the Company or to any other person,
      firm, corporation or entity by reason of such compliance.

     

    (g)  The
      escrow established hereby shall terminate upon the release of all of the
      Transaction Documents and delivery to the Company of the Escrowed Funds in
      

     

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    accordance
      with this Article 8, or at any time upon the agreement in writing of the Buyers
      and the Company.

     

    (h)  The
      Escrowed Funds shall neither be held in an interest bearing account nor will
      interest be payable in connection therewith. In the event the Escrowed Funds
      are
      deposited in an interest bearing account, each Buyer shall be entitled to
      receive its pro
      rata
      portion
      of any accrued interest thereon, but only if the Escrow Agent receives from
      such
      Buyer the Buyer’s United States taxpayer identification number and other
      requested information and forms.

     

    9.  GOVERNING
      LAW: MISCELLANEOUS.

     

    (a)  Governing
      Law.
      This
      Agreement shall be governed by and interpreted in accordance with the laws
      of
      the State of New York without regard to the principles of conflict of laws.
      The
      parties further agree that any action between them shall be heard exclusively
      in
      federal or state court sitting in the New York County, New York, and expressly
      consent to the jurisdiction and venue of the Supreme Court of New York, sitting
      in New York County and the United States District Court for the Southern
      District of New York for the adjudication of any civil action asserted pursuant
      to this Paragraph.

     

    (b)  Counterparts.
      This
      Agreement may be executed in two or more identical counterparts, all of which
      shall be considered one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other party.
      In
      the event any signature page is delivered by facsimile transmission, the party
      using such means of delivery shall cause four (4) additional original executed
      signature pages to be physically delivered to the other party within five (5)
      days of the execution and delivery hereof.

     

    (c)  Headings.
      The
      headings of this Agreement are for convenience of reference and shall not form
      part of, or affect the interpretation of, this Agreement.

     

    (d)  Severability.
      If any
      provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement in that jurisdiction or
      the
      validity or enforceability of any provision of this Agreement in any other
      jurisdiction.

     

    (e)  Entire
      Agreement, Amendments.
      This
      Agreement supersedes all other prior oral or written agreements between the
      Buyer(s), the Company, their affiliates and persons acting on their behalf
      with
      respect to the matters discussed herein, and this Agreement and the instruments
      referenced herein contain the entire understanding of the parties with respect
      to the matters covered herein and therein and, except as specifically set forth
      herein or therein, neither the Company nor any Buyer makes any representation,
      warranty, covenant or undertaking with respect to such matters. No provision
      of
      this Agreement may be waived or amended other than by an instrument in writing
      signed by the party to be charged with enforcement.

     

    (f)  Notices.
      Any
      notices, consents, waivers, or other communications required or permitted to
      be
      given under the terms of this Agreement must be in writing and will be deemed
      to
      have been delivered (i) upon receipt, when delivered personally; (ii) upon
      

     

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    confirmation
      of receipt, when sent by facsimile; (iii) upon receipt when sent by U.S.
      certified mail, return receipt requested, or (iv) one (1) day after deposit
      with
      a nationally recognized overnight delivery service, in each case properly
      addressed to the party to receive the same. The addresses and facsimile numbers
      for such communications shall be:

     

    
      	
              If
                to the Company, to:

            	
              
                Cromwell
                  Uranium Corp.

              

            
	 	
              1640
                Terrace Way 

            
	 	
              Walnut
                Creek, CA 94597

            
	 	
              Attention:    
                David
                Rector

            
	 	
              Telephone:  
                (925)
                930-0100

            
	 	
              Facsimile:    
                 (925)
                930-6338

            
	 	
               

            
	
              With
                a copy to (or for notices to 

              the
                Escrow Agent):

            	
               

              Gottbetter
                & Partners, LLP

            
	 	
              488
                Madison Avenue, 12th
                Floor

            
	 	
              New
                York, New York 10022

            
	 	
              Adam
                S. Gottbetter, Esq.

            
	 	
              Telephone:
                212-400-6900

            
	 	
              Facsimile:
                212-400-6901

            

    

    

     

    If
      to the
      Buyer(s), to its address and facsimile number on Schedule I, with copies to
      the
      Buyer’s counsel as set forth on Schedule I. Each party shall provide five (5)
      days’ prior written notice to the other party of any change in address or
      facsimile number.

     

    (g)  Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties and
      their respective successors and assigns. Neither the Company nor any Buyer
      shall
      assign this Agreement or any rights or obligations hereunder without the prior
      written consent of the other party hereto.

     

    (h)  No
      Third Party Beneficiaries.
      This
      Agreement is intended for the benefit of the parties hereto and their respective
      permitted successors and assigns, and is not for the benefit of, nor may any
      provision hereof be enforced by, any other person.

     

    (i)  Survival.
      Unless
      this Agreement is terminated under Section 9(l), the representations and
      warranties of the Company and the Buyer(s) contained in Sections 2 and 3, the
      agreements and covenants set forth in Sections 4, 5 and 9, and the
      indemnification provisions set forth in Section 7, shall survive the Closing
      for
      a period of two (2) years following the date on which the Convertible Debentures
      are converted in full. The Buyer(s) shall be responsible only for its own
      representations, warranties, agreements and covenants hereunder.

     

    (j)  Publicity.
      The
      Company and the Buyer(s) shall have the right to approve, before issuance any
      press release or any other public statement with respect to the transactions
      contemplated hereby made by any party; provided, however, that the Company
      shall
      be entitled, without the prior approval of the Buyer(s), to issue any press
      release or other public disclosure with respect to such transactions required
      under applicable securities or other laws or regulations (the Company shall
      use
      its best efforts to consult the Buyer(s) in connection with any 

     

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    such
      press release or other public disclosure prior to its release and Buyer(s)
      shall
      be provided with a copy thereof upon release thereof).

     

    (k)  Further
      Assurances.
      Each
      party shall do and perform, or cause to be done and performed, all such further
      acts and things, and shall execute and deliver all such other agreements,
      certificates, instruments and documents, as the other party may reasonably
      request in order to carry out the intent and accomplish the purposes of this
      Agreement and the consummation of the transactions contemplated
      hereby.

     

    (l)  Termination.
      In the
      event that the Closing shall not have occurred with respect to the Buyers on
      or
      before five (5) business days from the date hereof due to the Company’s or the
      Buyer’s failure to satisfy the conditions set forth in Sections 5 and 6 above
      (and the non-breaching party’s failure to waive such unsatisfied condition(s)),
      the non-breaching party shall have the option to terminate this Agreement with
      respect to such breaching party at the close of business on such date without
      liability of any party to any other party.

     

    (m)  No
      Strict Construction.
      The
      language used in this Agreement will be deemed to be the language chosen by
      the
      parties to express their mutual intent, and no rules of strict construction
      will
      be applied against any party.

     

    (n)  Remedies.
      In
      addition to being entitled to exercise all rights provided herein or granted
      by
      law, including recovery of damages, the Buyer and the Company will be entitled
      to specific performance under the Agreement. The parties agree that monetary
      damages may not be adequate compensation for any loss incurred by reason of
      any
      breach of obligations described in the foregoing sentence and hereby agree
      to
      waive in any action for specific performance of any such obligation the defense
      that a remedy at law would be adequate.

     

    

    [REMAINDER
      PAGE INTENTIONALLY LEFT BLANK]

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      Buyers and the Company have caused this Securities Purchase Agreement to be
      duly
      executed as of the date first written above.

     

    

    
      	
              ESCROW
                AGENT (with respect to Article 8 only)

            	
              COMPANY:

               

            
	
              Gottbetter
                & Partners, LLP

            	
              
                Cromwell
                  Uranium Corp.

              

            
	 	 
	
              By:/s/
                Adam Gottbetter

            	
              By:
                /s/ David Rector

            
	
              Name: Adam
                S. Gottbetter

            	
              Name: David
                Rector

            
	
              Title:
                Managing Partner

            	
              Title: Chief
                Executive Officer

            
	 	 

    

    

    

    

    
      
        
           

           

        

        
        

      

      
        23

        
          

        

      

      
        
        

        
        

      

    

     

    SCHEDULE
      I

     

    SCHEDULE
      OF BUYERS 

     

    
      	
               

              Name

            	
               

              Signature

            	
              Address/Facsimile
                

              Number
                of Buyer

            	
              Amount
                of Subscription

            

    

    
      	 	 	 	 
	 	
              By:__________________________

            	 	 
	 	
              Name:

            	 	 
	 	
              Office:

            	 	 
	 	 	 	 
	 	
              By:___________________________

            	 	 
	 	
              Name:

            	 	 
	 	
              Office:

            	 	 
	 	 	 	 
	 	
              By:____________________________

            	 	 
	 	
              Name:

            	 	 
	 	
              Office:

            	 	 
	 	 	 	 
	 	
              By:_____________________________

            	 	 
	 	
              Name:

            	 	 
	 	
              Office

            	 	 

    

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    Form
      of
      Instructions

    

    Mr.
      Adam
      Gottbetter

    Gottbetter
      & Partners, LLP

    488
      Madison Ave.

    New
      York,
      New York 10022-5718

    P:
      212-400-6900

    F:
      212-400-6901

    

    Re: Arbutus
      Resources, Inc.

    

    Dear
      Mr.
      Gottbetter:

    

    We
      hereby
      confirm that with respect to Article 8 of the Securities Purchase Agreement
      entered into on June , 2007 among Arbutus Resources, Inc., the Buyers and
      Gottbetter & Partners (the “Agreement”), LLP, the closing of the Debenture
      PPO (as defined in the Agreement) has taken place. All conditions for the
      release of the Transaction Documents and the Escrowed Funds have therefore
      been
      met. We authorize the release of the Transaction Documents and Escrowed Funds
      to
      the Company.

    

    ARBUTUS
      RESOURCES, INC.

    

     

    By:______________________________

    Name: David
      Rector

    Title:   Chief
      Executive Officer

    

    

    

    

    

    
      
        
        

      

      
        2Unassociated Document

    THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
      SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THESE SECURITIES MAY
      BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY,
      (B)
      OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER
      THE
      SECURITIES ACT, (C) IN COMPLIANCE WITH RULE 144 OR 144A THEREUNDER, IF
      AVAILABLE, AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, (D) PURSUANT
      TO AN EFFECTIVE REGISTRATION STATEMENT, OR (E) IN A TRANSACTION THAT DOES NOT
      REQUIRE REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
      LAWS, AND THE HOLDER HAS, PRIOR TO SUCH SALE, FURNISHED TO THE COMPANY AN
      OPINION OF COUNSEL OR OTHER EVIDENCE OF EXEMPTION, IN EITHER CASE REASONABLY
      SATISFACTORY TO THE COMPANY. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES
      MAY
      NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE U.S. SECURITIES ACT.

     

     

    9%
      CONVERTIBLE DEBENTURE

     

    
      CROMWELL
        URANIUM CORP.

    

     

    DUE
      JUNE 22, 2010

     

    

    
      	
              Original
                Issue Date: June 22, 2007

            	
              US$___

            

    

    

    This
      Debenture is one of a series of duly authorized and issued convertible
      debentures of Cromwell
      Uranium Corp., a Nevada corporation (the “Company”)
      designated its 9% Convertible Debentures due on June 22, 2010 (the “Debenture”)
      issued
      to ___ (together
      with its permitted successors and assigns, the “Holder”)
      pursuant to exemptions from registration
      under
      the Securities Act of 1933, as amended, pursuant to a Securities Purchase
      Agreement, dated June 22, 2007 (the “Securities
      Purchase Agreement”)
      among
      the Company and the Holder. 

     

    ARTICLE
      I.  

     

    Section
      1.01  Principal
      and Interest.
      For
      value
      received, the Company hereby promises to pay to the order of the Holder, in
      lawful money of the United States of America and in immediately available funds
      the principal sum of ________  Dollars ($_______).

     

    (a)  Interest
      shall accrue on the unpaid principal balance of the Debenture at the rate of
      nine percent (9%) per year (compounded monthly) commencing 120 days from
      the Original Issue Date until June 22, 2010 (the “Maturity Date”). Interest
      shall be calculated on the basis of a 360-day year.

     

    (b)  Commencing
      120 days from the Original Issue Date, the Company shall pay the Holder equal
      monthly installments of principal, together with accrued interest as

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    aforesaid.
      Thereafter, on the first business day of each month through and including the
      month in which the Maturity Date occurs, the Company shall pay such monthly
      installments of principal and interest. On the Maturity Date, the entire unpaid
      principal amount and all accrued and unpaid interest shall be paid to the Holder
      on the Maturity Date, unless this Debenture is converted in accordance with
      Section 1.02 herein.

     

    (c)  Except
      as
      otherwise set forth in this Debenture, the Company may not prepay any portion
      of
      the principal amount of this Debenture without the prior written consent of
      the
      Holder.

     

    Section
      1.02  Conversion.
      

     

    (a)  Optional
      Conversion.
      From
      and after October 30, 2007, the Holder shall be entitled, at its option, to
      convert, at any time and from time to time, until payment in full of this
      Debenture, all or any part of the principal amount of the Debenture, plus
      accrued and unpaid interest thereon, into units (“Units”)
      of the
      Company’s securities, at a price (the “Conversion
      Price”)
      of
      $0.50 per Unit. Each Unit shall consist of one share (the “Conversion
      Shares”)
      of the
      Company’s common stock, par value $.001 per share (the “Common
      Stock”),
      and
      one common stock purchase warrant (the “Warrants”).
      Each
      Warrant shall entitle the holder to purchase one share of Common Stock (the
      “Warrant
      Shares”)
      at an
      exercise price (the “Exercise
      Price”)
      of
      $0.75 per share, and shall be exercisable for a period of five years commencing
      the date of issuance. No fraction of shares or scrip representing fractions
      of
      shares will be issued on conversion, but the number of shares issuable shall
      be
      rounded to the nearest whole share. The number of Units issuable upon a
      conversion hereunder shall be determined by the quotient obtained by dividing
      (x) the outstanding principal amount of this Debenture, plus accrued and unpaid
      interest thereon, to be converted as set forth in the applicable Conversion
      Notice by (y) the Conversion Price. To convert this Debenture, the Holder hereof
      shall deliver written notice thereof, substantially in the form of
      Exhibit A to this Debenture, with appropriate insertions (the “Conversion
      Notice”),
      to
      the Escrow Agent (as defined in the Securities Purchase Agreement) and the
      Company at its address as set forth herein. The date upon which the conversion
      shall be effective (the “Conversion
      Date”)
      shall
      be deemed to be the date set forth in the Conversion Notice. Except as otherwise
      provided herein, the Company shall not have the right to object to the
      conversion or the calculation of the applicable conversion price, absent
      manifest error. Any conversion of any portion of the Debenture to Units shall
      be
      deemed to be a pre-payment of principal plus accrued and unpaid interest,
      without any penalty, and shall be credited against any future payments of
      principal and interest in the order that such payments become due and
      payable.

     

    (b)  Mandatory
      Conversion.
      Simultaneously with the closing of the Merger, this Debenture will automatically
      convert as to all unpaid principal, plus accrued interest, if any, into Units
      at
      the Conversion Price. The Company shall afford the Holder the opportunity to
      become a party to all agreements and instruments to be executed by the investors
      in the subsequent private placement offering (the “PPO”)
      by the
      Company of Units (which PPO shall commence following the closing of the Merger),
      including, but not limited to, a registration rights agreement (the
“Registration Rights Agreement”). The Registration Rights Agreement shall, among
      other things, register the Conversion Shares and the Warrant Shares under the
      Securities Act. 

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Section
      1.03  Reservation
      of Common Stock.
      As
      set
      forth in Section 4(e) of the Securities Purchase Agreement, the Company shall
      reserve and keep available out of its authorized but unissued shares of Common
      Stock, solely for the purpose of effecting the conversion of this Debenture
      and
      the exercise of the Warrants, that number of shares of Common Stock equal to
      the
      sum of (i) the number of shares of Common Stock into which the Debenture is
      convertible from time to time based upon the Conversion Price, plus (ii) the
      number of shares of Common Stock for which the Warrants are exercisable from
      time to time based upon the Exercise Price. 

     

    Section
      1.04  Absolute
      Obligation/Ranking.
      Except
      as expressly provided herein, no provision of this Debenture shall alter or
      impair the obligation of the Company, which is absolute and unconditional,
      to
      pay the principal of, interest and liquidated damages (if any) on, this
      Debenture at the time, place, and rate, and in the coin or currency, herein
      prescribed. This Debenture is a direct debt obligation of the Company. This
      Debenture ranks pari passu
      with all
      other Debentures now or hereinafter issued pursuant to the Securities Purchase
      Agreement.

     

    Section
      1.05  Paying
      Agent and Registrar.
      Initially, the Company will act as paying agent and registrar. The Company
      may
      change any paying agent, registrar, or Company-registrar by giving the Holder
      not less than ten (10) business days’ written notice of its election to do
      so, specifying the name, address, telephone number and facsimile number of
      the
      paying agent or registrar. The Company may act in any such
      capacity.

     

    Section
      1.06  Different
      Denominations.
      This
      Debenture is exchangeable for an equal aggregate principal amount of Debentures
      of different authorized denominations, as requested by the Holder surrendering
      the same. No service charge will be made for such registration of transfer
      or
      exchange.

     

    Section
      1.07  Investment
      Representations.
      This
      Debenture has been issued subject to certain investment representations of
      the
      original Holder set forth in the Securities Purchase Agreement and may be
      transferred or exchanged only in compliance with the Securities Purchase
      Agreement and applicable federal and state securities laws and
      regulations.

     

    Section
      1.08  Reliance
      on Debenture Register.
      Prior
      to due presentment to the Company for transfer or conversion of this Debenture,
      the Company and any agent of the Company may treat the Person in whose name
      this
      Debenture is duly registered on the Debenture Register as the owner hereof
      for
      the purpose of receiving payment as herein provided and for all other purposes,
      whether or not this Debenture is overdue, and neither the Company nor any such
      agent shall be affected by notice to the contrary.

     

    ARTICLE
      II.

     

    Section
      2.01  Amendments
      and Waiver of Default.
      The
      Debenture may not be amended without the consent of the Holder. Notwithstanding
      the above, without the consent of the Holder, the Debenture may be amended
      to
      cure any ambiguity, defect or inconsistency or to make any change that does
      not
      adversely affect the rights of the Holder.

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

     

    ARTICLE
      III.

     

    Section
      3.01  Events
      of Default.
      Each
      of
      the following events shall constitute a default under this Agreement (each
      an
“Event
      of Default”):
      

     

    (a)  failure
      by the Company to pay principal amount or interest due hereunder within ten
      (10)
      days of the date such payment is due; 

     

    (b) failure
      by the Company’s transfer agent to issue Common Stock to the Holder within
      five (5) days of the Company’s receipt of the attached Conversion Notice
      from Holder in accordance with the Securities Purchase Agreement; 

     

    (c) failure
      by the Company for ten (10) days after notice to it to comply with any of
      its other agreements in the Debenture; 

     

    (d) the
      Company shall: (1) make a general assignment for the benefit of its
      creditors; (2) apply for or consent to the appointment of a receiver,
      trustee, assignee, custodian, sequestrator, liquidator or similar official
      for
      itself or any of its assets and properties; (3) commence a voluntary case
      for relief as a debtor under the United States Bankruptcy Code; (4) file
      with or otherwise submit to any governmental authority any petition, answer
      or
      other document seeking: (A) reorganization, (B) an arrangement with
      creditors or (C) to take advantage of any other present or future
      applicable law respecting bankruptcy, reorganization, insolvency, readjustment
      of debts, relief of debtors, dissolution or liquidation; (5) file or
      otherwise submit any answer or other document admitting or failing to contest
      the material allegations of a petition or other document filed or otherwise
      submitted against it in any proceeding under any such applicable law, or
      (6) be adjudicated a bankrupt or insolvent by a court of competent
      jurisdiction;

     

    (e) any
      case,
      proceeding or other action shall be commenced against the Company for the
      purpose of effecting, or an order, judgment or decree shall be entered by any
      court of competent jurisdiction approving (in whole or in part) anything
      specified in Section 3.01(d) hereof, or any receiver, trustee, assignee,
      custodian, sequestrator, liquidator or other official shall be appointed with
      respect to the Company, or shall be appointed to take or shall otherwise acquire
      possession or control of all or a substantial part of the assets and properties
      of the Company, and any of the foregoing shall continue unstayed and in effect
      for any period of sixty (60) days;

     

    (f)  any
      material obligation of the Company for the payment of borrowed money is not
      paid
      when due or within any applicable grace period, or such obligation becomes
      or is
      declared to be due and payable before the expressed maturity of the obligation,
      or there shall have occurred an event that, with the giving of notice or lapse
      of time, or both, would cause any such obligation to become, or allow any such
      obligation to be declared to be, due and payable before the expressed maturity
      date of the obligation;

     

    (g) a
      breach
      by the Company of any material contract that would have a Material Adverse
      Effect (as defined in the Securities Purchase Agreement);

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (h) the
      Common Stock shall not be eligible for quotation on or quoted for trading on
      the
      OTC Bulletin Board and shall not again be eligible for and quoted for trading
      thereon within five (5) trading days; or

     

    (i) any
      default, whether in whole or in part, shall occur in the due observance or
      performance of any obligations or other covenants, terms or provisions to be
      performed under the Securities Purchase Agreement which is not cured by the
      Company within ten (10) days after receipt of written notice thereof.

    

    If
      any
      Event of Default occurs, the full principal amount of this Debenture, together
      with interest and other amounts owing in respect thereof, to the date of
      acceleration shall become, at the Holder’s election, immediately due and payable
      in cash. Commencing five (5) days after the occurrence of any Event of Default
      that results in the eventual acceleration of this Debenture, the interest rate
      on this Debenture shall accrue at the rate of 18% per annum, or such lower
      maximum amount of interest permitted to be charged under applicable law. All
      Debentures for which the full amount hereunder shall have been paid in
      accordance herewith shall promptly be surrendered to or as directed by the
      Company. The Holder need not provide and the Company hereby waives any
      presentment, demand, protest or other notice of any kind, and the Holder may
      immediately and without expiration of any grace period enforce any and all
      of
      its rights and remedies hereunder and all other remedies available to it under
      applicable law. Such declaration may be rescinded and annulled by Holder at
      any
      time prior to payment hereunder and the Holder shall have all rights as a
      Debenture holder until such time, if any, as the full payment under this Section
      shall have been received by it. No such rescission or annulment shall affect
      any
      subsequent Event of Default or impair any right consequent thereon.

     

    ARTICLE
      IV.

     

    Section
      4.01  Re-issuance
      of Debenture.
      When
      the
      Holder elects to convert a part of the Debenture, then the Company shall reissue
      a new Debenture in the same form as this Debenture to reflect the new principal
      amount and the Holder shall return the Debenture to the Company for
      cancellation.

     

     

    ARTICLE
      V.

     

    Section
      5.01  Anti-dilution.
      Adjustment
      of Conversion Price.
      The
      Conversion Price shall be adjusted from time to time as follows:

     

    (a)  Adjustment
      of Conversion Price and Number of Shares upon Issuance of Common
      Stock.
      If at
      any time after the Original Issue Date, the Company issues or sells, or is
      deemed to have issued or sold, any shares of Common Stock (other than (i)
      Excluded Securities (as defined herein) and (ii) shares of Common Stock which
      are issued or deemed to have been issued by the Company in connection with
      an
      Approved Stock Plan (as defined herein) or upon issuance, exercise or conversion
      of the Other Securities (as defined herein)) for a consideration per share
      less
      than a price (the “Applicable
      Price”)
      equal
      to the Conversion Price in effect immediately prior to such issuance or sale,
      then immediately after such issue or sale the Conversion Price then in effect
      shall be reduced to an amount equal to such consideration per share, provided
      that in no event shall the Conversion Price be reduced below $.001.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (b)  Effect
      on Conversion Price of Certain Events.
      For
      purposes of determining the adjusted Conversion Price under Section 5.01(a)
      above, the following shall be applicable:

     

    (i)  Issuance
      of Options.
      If
      after the date hereof, the Company in any manner grants any rights, warrants
      or
      options to subscribe for or purchase Common Stock or convertible securities
      (“Options”),
      other
      than Excluded Securities or Other Securities issued or deemed to have been
      issued in connection with any Approved Stock Plan, and the lowest price per
      share for which one share of Common Stock is issuable upon the exercise of
      any
      such Option or upon conversion or exchange of any convertible securities
      issuable upon exercise of any such Option is less than the Conversion Price
      then
      in effect, then such share of Common Stock shall be deemed to be outstanding
      and
      to have been issued and sold by the Company at the time of the granting or
      sale
      of such Option for such price per share. For purposes of this Section
      5.01(b)(i), the lowest price per share for which one share of Common Stock
      is
      issuable upon exercise of such Options or upon conversion or exchange of such
      convertible securities shall be equal to the sum of the lowest amounts of
      consideration (if any) received or receivable by the Company with respect to
      any
      one share of Common Stock upon the granting or sale of the Option, upon exercise
      of the Option or upon conversion or exchange of any other convertible security
      other than this Debenture issuable upon exercise of such Option. No further
      adjustment of the Conversion Price shall be made upon the actual issuance of
      such Common Stock or of such convertible securities upon the exercise of such
      Options or upon the actual issuance of such Common Stock upon conversion or
      exchange of such convertible securities.

     

    (ii)  Issuance
      of Convertible Securities.
      If the
      Company in any manner issues or sells any convertible securities after the
      Original Issue Date, other than Excluded Securities or Other Securities issued
      or deemed to have been issued in connection with an Approved Stock Plan, and
      the
      lowest price per share for which one share of Common Stock is issuable upon
      the
      conversion or exchange thereof is less than the Conversion Price then in effect,
      then such share of Common Stock shall be deemed to be outstanding and to have
      been issued and sold by the Company at the time of the issuance or sale of
      such
      convertible securities for such price per share. For the purposes of this
      Section 5.01(b)(ii), the lowest price per share for which one share of
      Common Stock is issuable upon such conversion or exchange shall be equal to
      the
      sum of the lowest amounts of consideration (if any) received or receivable
      by
      the Company with respect to one share of Common Stock upon the issuance or
      sale
      of the convertible security and upon conversion or exchange of such convertible
      security. No further adjustment of the Conversion Price shall be made upon
      the
      actual issuance of such Common Stock upon conversion or exchange of such
      convertible securities, and if any such issue or sale of such convertible
      securities is made upon exercise of any Options for which adjustment of the
      Conversion Price had been or are to be made pursuant to other provisions of
      this
      Section 5.01(b), no further adjustment of the Conversion Price shall be made
      by
      reason of such issue or sale. 

     

    (iii)  Change
      in Option Price or Rate of Conversion.
      If the
      purchase price provided for in any Options, the additional consideration, if
      any, payable upon the issue, conversion or exchange of any convertible
      securities, or the rate at which any convertible securities are convertible
      into
      or exchangeable for Common Stock changes at any time, the Conversion Price
      in
      effect at the time of such change shall be adjusted to the Conversion Price
      which would have been in effect at such time had such Options or convertible
      securities provided 

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    for
      such
      changed purchase price, additional consideration or changed conversion rate,
      as
      the case may be, at the time initially granted, issued or sold and the number
      of
      shares of Common Stock issuable upon conversion of this Debenture shall be
      correspondingly readjusted. For purposes of this Section 5.01(b)(iii), if the
      terms of any Option or convertible security that was outstanding as of the
      Original Issue Date are changed in the manner described in the immediately
      preceding sentence, then such Option or convertible security and the Common
      Stock deemed issuable upon exercise, conversion or exchange thereof shall be
      deemed to have been issued as of the date of such change. No adjustment pursuant
      to this Section 5.01(b) shall be made if such adjustment would result in an
      increase of the Conversion Price then in effect. 

     

    (c)  Effect
      on Conversion Price of Certain Events.
      For
      purposes of determining the adjusted Conversion Price under
      Sections 5.01(a) and 5.01(b), the following shall be applicable:

     

    (i)  Calculation
      of Consideration Received.
      If any
      Common Stock, Options or convertible securities are issued or sold or deemed
      to
      have been issued or sold for cash, the consideration received therefore will
      be
      deemed to be the net amount received by the Company therefore. If any Common
      Stock, Options or convertible securities are issued or sold for a consideration
      other than cash, the amount of such consideration received by the Company will
      be the fair value of such consideration, except where such consideration
      consists of marketable securities, in which case the amount of consideration
      received by the Company will be the market price of such securities on the
      date
      of receipt of such securities (measured by the closing sale price of such
      securities on the Over-the-Counter Bulletin Board or its principal trading
      market). If any Common Stock, Options or convertible securities are issued
      to
      the owners of the non-surviving entity in connection with any merger in which
      the Company is the surviving entity, the amount of consideration therefore
      will
      be deemed to be the fair value of such portion of the net assets and business
      of
      the non-surviving entity as is attributable to such Common Stock, Options or
      convertible securities, as the case may be. The fair value of any consideration
      other than cash or securities will be determined jointly by the Company and
      the
      holders of the principal amount of the Debentures then outstanding. If such
      parties are unable to reach agreement within ten (10) days after the
      occurrence of an event requiring valuation (the “Valuation
      Event”),
      the
      fair value of such consideration will be determined within five (5) Business
      Days after the tenth (10th)
      day
      following the Valuation Event by an independent, reputable appraiser jointly
      selected by the Company and the holders of the principal amount of the
      Debentures then outstanding. The determination of such appraiser shall be final
      and binding upon all parties and the fees and expenses of such appraiser shall
      be borne by the Company.

     

    (ii)  Integrated
      Transactions.
      In case
      any Option is issued in connection with the issue or sale of other securities
      of
      the Company, together comprising one integrated transaction in which no specific
      consideration is allocated to such Options by the parties thereto, the Options
      will be deemed to have been issued for a consideration of $.001. 

     

    (iii)  Treasury
      Shares.
      The
      number of shares of Common Stock outstanding at any given time does not include
      shares owned or held by or for the account of the Company, and the disposition
      of any shares so owned or held will be considered an issue or sale of Common
      Stock. 

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (iv)  Record
      Date.
      If the
      Company takes a record of the holders of Common Stock for the purpose of
      entitling them (1) to receive a dividend or other distribution payable in
      Common Stock, Options or in convertible securities or (2) to subscribe for
      or purchase Common Stock, Options or convertible securities, then such record
      date will be deemed to be the date of the issue or sale of the shares of Common
      Stock deemed to have been issued or sold upon the declaration of such dividend
      or the making of such other distribution or the date of the granting of such
      right of subscription or purchase, as the case may be. 

     

    (d)  Adjustment
      of Conversion Price upon Subdivision or Combination of Common
      Stock.
      If at
      any time after the date of issuance of this Debenture subdivides (by any stock
      split, stock dividend, recapitalization or otherwise) one or more classes of
      its
      outstanding shares of Common Stock into a greater number of shares, the
      Conversion Price or Future Price in effect immediately prior to such subdivision
      will be proportionately reduced. If the Company at any time after the date
      of
      issuance of this Debenture combines (by combination, reverse stock split or
      otherwise) one or more classes of its outstanding shares of Common Stock into
      a
      smaller number of shares, the Conversion Price or Future Price in effect
      immediately prior to such combination will be proportionately increased. Any
      adjustment under this Section 5.01(d) shall become effective at the close
      of business on the date the subdivision or combination becomes effective.

     

    (e)  Distribution
      of Assets.
      If the
      Company shall declare or make any dividend or other distribution of its assets
      (or rights to acquire its assets) to holders of Common Stock, by way of return
      of capital or otherwise (including, without limitation, any distribution of
      cash, stock or other securities, property or options by way of a dividend,
      spin
      off, reclassification, corporate rearrangement or other similar transaction)
      (a
“Distribution”),
      at
      any time after the issuance of this Debenture, then, in each such case the
      Conversion Price in effect immediately prior to the close of business on the
      record date fixed for the determination of holders of Common Stock entitled
      to
      receive the Distribution shall be reduced, effective as of the close of business
      on such record date, to a price determined by multiplying such Conversion Price
      by a fraction of which (A) the numerator shall be the closing bid price of
      the
      Common Stock on the trading day immediately preceding such record date minus
      the
      value of the Distribution (as determined in good faith by the Company’s Board of
      Directors) applicable to one share of Common Stock, and (B) the denominator
      shall be the closing bid price of the Common Stock on the trading day
      immediately preceding such record date. Notwithstanding the foregoing, the
      Distribution in the form of a stock dividend (the “Forward
      Split”)
      to be
      effected prior to, and in connection with, the Merger shall in no event cause
      an
      adjustment to the Conversion Price, nor shall any similar adjustment to the
      capital structure of the Company effected in connection with the
      Merger.

     

    (f)  Certain
      Events.
      If any
      event occurs of the type contemplated by the provisions of this
      Section 5.01 but not expressly provided for by such provisions (including,
      without limitation, the granting of stock appreciation rights, phantom stock
      rights or other rights with equity features but excluding the Recapitalization,
      as such term is defined in the Securities Purchase Agreement), then the
      Company’s Board of Directors will make an appropriate adjustment in the
      Conversion Price so as to protect the rights of the holders of the Debenture;
      provided, except as set forth in Section 5.01(d), that no such adjustment
      pursuant to this Section 5.01(f) will increase the Conversion Price as otherwise
      determined pursuant to this Section 5.01.

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (g)  Notices.

     

    (i)  Immediately
      upon any adjustment of the Conversion Price, the Company will give written
      notice thereof to the holder of this Debenture, setting forth in reasonable
      detail, and certifying, the calculation of such adjustment.

     

    (ii)  The
      Company will give written notice to the holder of this Debenture at least ten
      (10) days prior to the date on which the Company closes its books or takes
      a
      record (A) with respect to any dividend or distribution upon the Common
      Stock, (B) with respect to any pro rata subscription offer to holders of
      Common Stock or (C) for determining rights to vote with respect to any
      dissolution or liquidation, provided that such information shall be made known
      to the public prior to or in conjunction with such notice being provided to
      such
      holder.

     

    (h)  Definitions.

     

    (i)  “Approved
      Stock Plan”
means
      any employee benefit plan which has been approved by the Board of Directors
      of
      the Company, or any successor thereto, pursuant to which the Company’s
      securities may be issued to any employee, officer or director for services
      provided to the Company.

     

    (ii)  “Excluded
      Securities”
means
      any of the following: (a) any issuance by the Company of securities in
      connection with a strategic partnership or a joint venture (the primary purpose
      of which is not to raise equity capital), (b) any issuance by the Company of
      securities as consideration for a merger or consolidation or the acquisition
      of
      a business, product, license, or other assets of another person or entity and
      (c) options to purchase shares of Common Stock, or other stock based awards
      or
      grants under an Approved Stock Plan.

     

    (iii)  “Other
      Securities”
means
      (i) those options and warrants of the Company issued prior to, and
      outstanding on, the Original Issue Date, (ii) the Units, including the Common
      Stock and Warrants included in the Units, issued in the PPO, (ii) the shares
      of
      Common Stock issuable on exercise of such options and warrants, provided such
      options and warrants are not amended after the Original Issue Date, (iii) the
      shares of Common Stock issued in connection with the Forward Split and
      (iv) the shares of Common Stock issuable upon exercise of the Warrants or
      conversion of this Debenture.

     

    (i)  Nothing
      in this Section 5.01 shall be deemed to authorize the issuance of any securities
      by the Company in violation of Section 5.02.

     

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      VI.

     

    Section
      6.01  Notice.
      Notices
      regarding this Debenture shall be sent to the parties at the following
      addresses, unless a party notifies the other parties, in writing, of a change
      of
      address:

     

    
      	
              If
                to the Company, to:

            	
              
                Cromwell
                  Uranium Corp.

              

            
	 	
              1640
                Terrace Way

            
	 	
              Walnut
                Creek, CA 94597

            
	 	
              Attention:     
                David
                Rector

            
	 	
              Telephone:   
                925.930.0100

            
	 	
              Facsimile:      
                925.930.6338

            
	 	 
	
              With
                a copy to:

            	
              Gottbetter
                & Partners, LLP

            
	 	
              488
                Madison Avenue, 12th
                Floor

            
	 	
              New
                York, New York 10022

            
	 	
              Adam
                S. Gottbetter, Esq.

            
	 	
              Telephone:     212.400.6900

            
	 	
              Facsimile:       
                212.400.6901

            
	 	 
	
              If
                to the Holder:

            	
               

            
	 	
               

            
	 	
               

            
	 	
              Telephone: 

            
	 	
              Facsimile:   

            
	 	 
	
              With
                a copy to:

            	 
	 	 
	 	 
	 	 
	 	
              Telephone: 

            
	 	
              Facsimile: 

            
	 	 
	 	 

    

    

    Section
      6.02  Governing
      Law.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Debenture 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 in the state and federal
      courts sitting in the City of New York, Borough of Manhattan (the “New York
      Courts”). Each party hereto hereby irrevocably submits to the exclusive
      jurisdiction of the New York Courts 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 the
      Transaction Documents), 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 

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    such
      court, or such New York Courts are improper or inconvenient venue for such
      proceeding. Each party 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 address in effect for notices
      to it under this Debenture 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 Debenture or the
      transactions contemplated hereby. If either party shall commence an action
      or
      proceeding to enforce any provisions of this Debenture, then the prevailing
      party in such action or proceeding shall be reimbursed by the other party for
      its attorneys fees and other costs and expenses incurred with the investigation,
      preparation and prosecution of such action or proceeding.

     

    Section
      6.03  Severability.
      The
      invalidity of any of the provisions of this Debenture shall not invalidate
      or
      otherwise affect any of the other provisions of this Debenture, which shall
      remain in full force and effect.

     

    Section
      6.04  Entire
      Agreement and Amendments.
      This
      Debenture represents the entire agreement between the parties hereto with
      respect to the subject matter hereof and there are no representations,
      warranties or commitments, except as set forth herein. This Debenture may be
      amended only by an instrument in writing executed by the parties
      hereto.

     

    

    [Remainder
      Of Page Intentionally Left Blank]

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      with
      the intent to be legally bound hereby, the Company as executed this Debenture
      as
      of the date first written above.

     

    
      	 	
              
                Cromwell
                  Uranium Corp.

              

            
	 	 
	 	
              By: /s/
                David Rector   

            
	 	
              Name: David
                Rector

            
	 	
              Title: Chief
                Executive Officer

            

    

    

    

    

    

    
      
        
           

          {00091845.1
            / 0000-090}

        

        
        

      

      
        12

        
          

        

      

      
        
        

        
        

      

    

     

    EXHIBIT
      A

     

    NOTICE
      OF CONVERSION

     

    (To
      be executed by the Holder in order to convert the
      Debenture)

     

    
      	
              TO:

            	 

    

    

    The
      undersigned hereby irrevocably elects to convert $     
      of the
      principal amount of the above Debenture into Shares of Common Stock of Arbutus
      Resources, Inc., according to the conditions stated therein, as of the
      Conversion Date written below.

    
      	
              Conversion
                Date:

            	
            
	
              Applicable
                Conversion Price:

            	 
	
              Signature:

            	 
	
              Name:

            	 
	
              Address:

            	 
	
              Amount
                to be converted:

            	
              $          

            
	
              Amount
                of Debenture unconverted:

            	
              $          

            
	
              Conversion
                Price per Unit: 

            	
              $          

            
	
              Interest
                on the Principal being 

              converted
                shall be paid is 

            	
            
	
              Number
                of shares of Common 

              Stock
                and Warrants to be issued 

              including
                as payment of interest, if applicable:

            	
            
	
              Please
                issue the shares of Common 

              Stock
                and Warrants in the following name 

              and
                to the following address:

            	 
	
              Issue
                to the following account of the Holder:

            	 
	
              Authorized
                Signature:

            	 
	
              Name:

            	 
	
              Title:

            	 
	
              Phone
                Number:

            	 
	
              Broker
                DTC Participant Code:

            	 
	
              Account
                Number:

            	 

    

    
 

    
      
        
        

      

      
        A-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}]]