Document:

Pure Cap Stock Purchase Agreement

    SECURITIES
      PURCHASE AGREEMENT

    

    This
      Securities Purchase Agreement, (the “Agreement”)
      is made and entered into as of December ___, 2006, by and between Pure Capital
      Incorporated, a Canadian Federal corporation (the “Company”) and
      ____________________________________________ (the “Purchaser”).

    

    RECITALS

    

    Whereas,
      the
      Company has authorized the sale of a Convertible Note (the “Note”) in an
      aggregate principal amount of ________________________________________________
      ($_____________) dollars, convertible into shares of the Company’s common stock,
      no par value per share (the “Common Stock”);

    

    Whereas,
      Purchaser
      desires to purchase the Note on the terms and conditions set forth
      herein;

    

    Whereas,
      the
      Company desires to issue and sell the Note to Purchaser on the terms and
      conditions set forth herein;

    

    Whereas,
      the
      Company and the Purchaser are executing and delivering this agreement in
      reliance upon the exemption from securities registration afforded by §4(2) of
      the Securities Act of 1933, as amended (the “Securities Act”).

    

    AGREEMENT

    

    Now
      therefore,
      in
      consideration of the foregoing recitals and the mutual promises,
      representations, warranties and covenants hereafter set forth and for other
      good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, the parties hereto agree as follows.

    

    ARTICLE
      I

    GENERAL

    

    1.1  Agreement
      to Sell and Purchase. Pursuant
      to the terms and conditions set forth in this Agreement, the Company agrees
      to
      sell to the Purchaser, and the Purchaser hereby agrees to purchase from the
      Company a Note in the amount of $___________________ convertible in accordance
      with the terms thereof into shares of the Common Stock. The Note purchased
      shall
      be known as the “Offering”. The Note will have a maturity date (as defined in
      the Note) twenty four months from the day of issuance. Collectively, the Note
      and Common Stock issuable in payment of the Note upon conversion of the Note
      are
      referred to as the “Securities”.

    

    ARTICLE
      II

    REPRESENTATIONS
      AND 

    WARRANTIES
      OF THE PURCHASER

    

    2.1
       Investment
      Representations. Purchaser
      understands that the Securities are being offered and sold pursuant to an
      exemption from registration contained in the Securities Act based in part upon
      the Purchasers representations contained in this Agreement, including, without
      limitation, that the Purchaser is an “Accredited Investor” within the meaning of
      Regulation D under the Securities Act. 

    

    2.2 Purchaser
      Bears Economic Risk. Purchaser
      has substantial experience in evaluating and investing in private placement
      transactions of securities in companies similar to the Company so that he is
      capable of evaluating the merits and risks of his investment in the Company,
      and
      has the capacity to protect his own interests. Purchaser must bear the economic
      risk of this investment until the Securities are sold pursuant to (i) an
      effective registration statement under the Securities Act, or (ii) an exemption
      from registration is available.

    

    2.3 Acquisition
      for Own Account.
      Purchaser is acquiring the Note and the shares of Common Stock issuable upon
      conversion of the Note (the “Note Shares”) for Purchasers own account for
      investment only, and not with a view towards distribution. 

    

    2.4 Purchaser
      Can Protect His Interests.
       Purchaser
      represents that by reason of his business and financial experience, Purchaser
      has the capacity to protect his own interests in connection with the
      transactions contemplated in this Agreement. 

    

    2.5 Accredited
      Investor. Purchaser
      represents that he is an Accredited Investor within the meaning of Regulation
      D
      under the Securities Act.

    

    
      	2.6  	
              Legends.

            

    

    

    (a) The
      Note
      shall bear substantially the following legend until the Note and Note Shares
      are
      covered by an effective registration statement filed with the Securities and
      Exchange Commission (“SEC”):

    

    “THIS
      NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR, IF APPLICABLE,
      STATE SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION
      OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
      THE
      ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE OR SUCH SHARES
      UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
      REASONABLY SATISFACTORY TO PURE CAPITAL INCORPORATED THAT SUCH REGISTRATION
      IS
      NOT REQUIRED.”

    

    (b) The
      Note
      Shares shall bear a legend which shall be in substantially the following form
      until such shares are covered by an effective registration statement filed
      with
      the SEC:

    

    “THE
      SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, OR IF APPLICABLE, STATE SECURITIES LAWS.
      THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
      THE
      ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND
      APPLICABLE STATE LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO PURE
      CAPITAL INCORPORATED THAT SUCH REGISTRATION IS NOT REQUIRED.”

    

    ARTICLE
      III

    REPRESENTATIONS
      AND 

    WARRANTIES
      OF THE COMPANY

    

    3.1 Representations
      and Warranties.
      The
      Company represents to the Purchaser that:

    

    (a) Organization
      and Qualifications. The Company is duly organized and existing in good standing
      under the law of the jurisdiction in which it was incorporated, and has the
      requisite corporate power to own their properties and to carry on their business
      as now being conducted.   

     

    (b) Authorization
      Enforcement. (i) The Company has the requisite corporate power and authority
      to
      perform the Agreement, and to issue the Securities in accordance with the terms
      hereof and thereof, (ii) the execution and delivery of this Agreement by the
      Company and the consummation by it of the transactions contemplated hereby
      and
      thereby have been duly authorized by the Company’s Board of Directors and no
      further consent or authorization of the Company, or its Board of Directors
      or
      stockholders is required, (iii) this Agreement has been duly executed and
      delivered, and (iv) the Agreement constitutes a valid and binding obligation
      of
      the Company enforceable against the Company in accordance with its
      terms.

    

    (c) Issuance
      of Note. The Note is duly authorized and is validly issued, fully paid and
      non-assessable, free of any encumbrances, and are not subject to preemptive
      rights of stockholders of the Company. 

    

    (d) No
      Conflicts. The execution, delivery and performance of this Agreement and the
      Note 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 or By-laws of the Company or its subsidiaries or (ii) conflict
      with, or constitute a default, (or an event which with notice or lapse of time
      or both could become a default) or to give others any rights of termination,
      amendment 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) applicable to the Company or any of
      its
      subsidiaries or by which any material property or asset of the Company or any
      of
      its subsidiaries is bound or affected.

    

    (e) Third
      Party Consents. 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 or any
      regulatory or self regulatory agency in order for it to execute, deliver or
      perform any of its obligations under this Agreement in accordance with the
      terms
      hereof and thereof. 

    

    (f) Information
      Disclosure. All information related to the Company disclosed to the Purchaser,
      whether orally or in writing, does not contain any false or misleading statement
      of material fact or omit to state any material fact required to be stated
      therein or necessary in order to make the statements made therein not
      misleading. Except as otherwise disclosed to the Purchaser, neither the Company
      nor its subsidiaries has undertaken any liability or obligation, direct or
      contingent, except for liabilities or obligations undertaken in the ordinary
      course of business.

    

    (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 or, to the knowledge of the Company or any of
      its
      subsidiaries, threatened against or affecting the Company or any of its
      subsidiaries that is reasonably likely to have a Material Adverse Effect.
“Material Adverse Effect” means any material adverse effect on the business,
      properties, operations, assets, financial condition or results of operations
      of
      the Company taken as a whole, or on the transactions contemplated hereby or
      by
      the agreements or instruments to be entered into in connection
      herewith.

    

    (h) Patents,
      Copyrights, etc. The Company: (i) owns or has the right to use, free and clear
      of all liens, claims, encumbrances, pledges, security interests, and other
      adverse interests of any kind whatsoever, all patents, inventions, know-how,
      trade secrets, trademarks, service marks, trade names, copyrights, technology,
      and all other licenses and rights with respect to the foregoing, used in the
      conduct of its business as now conducted or proposed to be conducted without,
      to
      the best knowledge of the Company and its subsidiaries, infringing upon or
      otherwise acting adversely to the right or claimed right of any person, company
      or other entity; (ii) is not obligated or under any liability whatsoever to
      make
      any payment by way of royalties, fees or otherwise to any owner or licensee
      of,
      or other claimant to, any patent, trademark, service mark, trade name,
      copyright, know-how, technology or other intangible asset, with respect to
      the
      use thereof or in connection with the conduct of its business or otherwise;
      and
      (iii) has not received any notice of infringement of or conflict with asserted
      rights of others with respect to any of the foregoing which, singly or in the
      aggregate, are the subject of an unfavorable decision, ruling or finding, that
      might have a Material Adverse Effect.

    

    (h) Taxes.
      The Company and it subsidiaries have filed or caused to be filed all income
      tax
      returns which are required to be filed and have paid or have caused to be paid
      all taxes and all assessments received by them to the extent that such taxes
      and
      assessments have become due, except taxes and assessments the validity or amount
      of which is being contested in good faith by appropriate proceedings and with
      respect to which adequate reserves have been set aside, and except for such
      returns for which the failure to file would not have a Material Adverse Effect
      upon the Company and its subsidiaries taken as a whole. The Company and its
      subsidiaries have paid or caused to be paid, or has established reserves that
      the Company reasonably believes to be adequate in all material respects, for
      all
      federal income tax liabilities and state income tax liabilities applicable
      to
      the Company and its subsidiaries for all fiscal years which have not been
      examined and reported on by the taxing authorities (or closed by applicable
      statutes).

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      IV

    CONVERSION
      OF CONVERTIBLE NOTE

    

    4.1 Mechanics
      of Conversion.

    

    (a) Provided
      the Purchaser has notified the Company of the Purchaser’s intention to sell the
      Note Shares and the Note Shares are included in an effective registration
      statement or are otherwise exempt from registration when sold: (i) Upon the
      conversion of the Note or part thereof, the Company shall, at its own cost
      and
      expense, take all necessary action (including the issuance of an opinion of
      counsel) to assure that the Company’s transfer agent shall issue stock
      certificates in the name of the Purchaser (or its nominee) or such other persons
      as designated by the Purchaser and in such denominations to be specified
      representing the number of Note Shares issuable upon such conversion; and (ii)
      The Company warrants that no instructions other than these instructions have
      been or will be given to the transfer agent of the Common Stock and that the
      Note Shares issued will be un-legended, free-trading, and freely transferable,
      and will not contain a legend restricting the resale or transferability of
      the
      Note Shares.

    

    (b) Purchaser
      will give notice of his decision to exercise his right to convert the Note
      or
      part thereof, which is within his sole discretion at his opinion, by telecopying
      or otherwise delivering an executed and complete written notice of the number
      of
      shares to be converted to the Company (the “Notice of Conversion”). The
      Purchaser will not be required to surrender the Note until the Purchaser
      receives a certificate or certificates, as the case may be, representing the
      Note Shares or until the Note has been fully satisfied. Each date on which
      a
      Note of Conversion is telecopied or delivered to the Company in accordance
      with
      the provisions hereof shall be deemed a “Conversion Date”. The Company will or
      will cause the transfer agent to transmit the Common Stock certificates
      representing the shares issuable upon conversion of the Note (and a certificate
      representing the balance of the Note not so converted, if requested by
      Purchaser) to the Purchaser via express courier for receipt by such Purchaser
      within three business days after receipt by the Company of the Notice of
      Conversion (the “Delivery Date”).

    

    ARTICLE
      V

    REGISTRATION
      RIGHTS

    

    5.1 Piggyback
      Registration Rights.  If
      at any
      time the Company shall determine to file with the SEC a registration statement
      relating to an offering for its own account or the account of others under
      the
      Security Act of any of its equity securities (other than on Form S-4 or Form
      S-8
      or their then equivalents relating to equity securities to be issued solely
      in
      connection with any acquisition of an entity or business or equity securities
      issuable in connection with stock option or other bona fide, employee benefit
      plans), the Company shall send each Purchaser who is entitled to registration
      rights under this Section 5, written notice of such determination and, if within
      fifteen days after the effective date of such notice, such Purchasers shall
      so
      request in writing, the Company shall include in such registration statement
      all
      or any part of the Securities such Purchaser requests to be registered, except
      that if, in connection with any underwritten public offering for the account
      of
      the Company the managing underwriter(s) thereof shall impose a limitation on
      the
      number of shares of Common Stock which may be included in the registration
      statement because, in such underwriter(s) judgment marketing or other factors
      dictate such limitation is necessary to facilitate public distribution, then
      the
      Company shall be obligated to include in such registration statement only such
      limited portion of the Securities with respect to which such Purchaser has
      requested inclusion hereunder as the underwriter shall permit. An exclusion
      of
      Securities shall be made pro rata among the Purchasers seeking to include
      Securities in proportion to the number of Securities sought to be included
      by
      such Purchaser; provided
      however,
      that
      the Company shall not exclude any Securities unless the Company has first
      excluded all outstanding securities, the holders of which are not entitled
      to
      inclusion of such securities in such registration statement or are not entitled
      to pro rata inclusion with the Securities; provided,
      further, however,
      that,
      after giving affect to the immediately preceding proviso, any exclusion of
      the
      Securities shall be made pro rata with holders of other securities having the
      right to include such securities in the registration statement other than
      holders of securities entitled to inclusion of their securities in such
      registration statement by reason of demand registration rights. If an offering
      in connection with a Purchaser is entitled to registration under this Section
      5
      is an underwritten offering, then each Purchaser whose Securities are included
      in such registration statement shall, unless otherwise agreed by the Company,
      offer and sell such Securities in an underwritten offering using the same
      underwriter or under writers on the same terms and conditions that other shares
      of common stock included in such underwritten offering. Any costs associated
      with this piggy back registration shall be paid by the Company.

     

    ARTICLE
      VI

    MISCELLANEOUS

    

    6.1 Entire
      Agreement. This
      Agreement, the exhibits and schedules hereto, the related agreements and the
      other documents delivered pursuant hereto constitute the full and entire
      understanding and agreement between the parties with regard to the subjects
      hereof and no party shall be liable or bound to any other in any manner by
      any
      representations, warranties, covenants and agreements except as specifically
      set
      forth herein and therein.

    

    6.2 Notices. All
      notices required or permitted hereunder shall be in writing and shall be deemed
      effectively given: (a) upon personal delivery to the party to be notified;
      (b)
      when sent by confirmed telex or facsimile if sent during normal business hours
      of the recipient, if not, then on the next business day; (c) five days after
      having been sent by registered or certified mail, return receipt requested,
      postage prepaid; or (d) one day after deposit with a nationally recognized
      over
      night courier, specifying next day delivery, with written verification off
      receipt. All communications shall be sent to the Company at the address as
      set
      forth on the signature page hereof and to the Purchaser at the address set
      forth
      on the signature page hereto for such Purchaser, or at such other addresses
      as
      the Company or the Purchaser may designate by ten days advance written notice
      to
      other parties hereto.

    

    6.3 Titles
      and Subtitles. The
      titles of the sections and subsections
      of
      the
      Agreement are for the convenience of reference only and are not to be considered
      in construing this agreement.

    

    6.4 Facsimile
      Signatures; Counterparts. This
      Agreement may be executed by facsimile signatures and in any number of
      counterparts, each of which shall be original, but all of which together shall
      constitute one instrument.

    

    6.5 Brokers
      Fees.
      Each
      party hereto represents and warrants that no agent, investment banker, broker,
      person or firm acting on behalf of or under the authority of such party hereto
      is or will be entitled to any broker’s or finder’s fee or any other commission
      directly or indirectly in connection with the transaction contemplated herein,
      except as specified herein with respect to the Company. Each party hereto
      further agrees to indemnify each other party for any, claims losses or expenses
      inured by such other party as a result of the representation in this section
      6.5
      being untrue, other than for a breach of representation or warranty made by
      the
      Company herein.

    

    6.6 Construction. Each
      party acknowledges that its legal counsel participated in the preparation of
      this Agreement and, therefore, stipulates that the rule of construction that
      ambiguities are to be resolved against the drafting party shall not be applied
      in the interpretation of this agreement to favor any party against the
      other.

    

    6.7 Governing
      Law.
      THIS
      AGREEMENT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
      LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE
      PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES OF
      CONFLICT OF LAWS. THE PARTIES HERETO HEREBY SUBMIT TO THE EXCLUSIVE JURISDICTION
      OF THE UNITED STATES FEDERAL COURTS LOCATED IN SAN DIEGO COUNTY, CALIFORNIA
      WITH
      RESPECT TO ANY DISPUTE ARISING UNDER THIS AGREEMENT, THE AGREEMENTS ENTERED
      INTO
      IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
      BOTH
      PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
      MAINTENANCE OF SUCH SUIT OR PROCEEDING. BOTH PARTIES FURTHER AGREE THAT SERVICE
      OF PROCESS UPON A PARTY MAILED BY REGISTERED FIRST CLASS MAIL SHALL BE DEEMED
      IN
      EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT
      OR
      PROCEEDING. NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE PROCESS IN
      ANY OTHER MANNER PERMITTED BY LAW. BOTH PARTIES AGREE THAT A FINAL
      NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE
      AND
      MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER
      LAWFUL MANNER. THE PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE ARISING UNDER
      THIS AGREEMENT SHALL BE RESPONSIBLE FOR ALL FEES AND EXPENSES, INCLUDING
      REASONABLE ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY IN CONNECTION WITH
      SUCH DISPUTE.

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the
      parties hereto have executed this SECURITIES PURCHASE AGREEMENT as of the date
      set forth in the first paragraph hereof.

    

    PURE
      CAPITAL INCORPORATED  _______________________
      (“Purchaser”)   

    

     

    

    By:_________________________________ By:__________________________________

    Name:       

    Title: 

    

    The
      Purchaser is an Accredited Investor because the Purchaser is (check appropriate
      item): 

     

    _____
      a
      bank, insurance company, registered investment company, business development
      company, or small business investment company; 

    

    _____
      a
      charitable organization, corporation, or partnership with assets exceeding
      $5
      million; 

    

    _____
      a
      director, executive officer, or general partner of the company selling the
      securities; 

    

    _____
      a
      business in which all the equity owners are accredited investors; 

    

    _____
      a
      natural person who has individual net worth, or joint net worth with the
      person’s spouse, that exceeds $1 million at the time of the purchase;

    

    _____
      a
      natural person with income exceeding $200,000 in each of the two most recent
      years or joint income with a spouse exceeding $300,000 for those years and
      a
      reasonable expectation of the same income level in the current year; or

    

    _____
      a
      trust with assets in excess of $5 million, not formed to acquire the securities
      offered, whose purchases a sophisticated person makes. 

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    THIS
      NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS NOTE AND THE
      COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED
      FOR
      SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
      STATEMENT AS TO THIS NOTE UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY
      SATISFACTORY TO PURE CAPITAL INCORPORATED THAT SUCH REGISTRATION IS NOT
      REQUIRED. CERTIFICATES REPRESENTING ANY SECURITIES ISSUABLE UPON CONVERSION
      OF
      THIS NOTE SHALL INCLUDE A LEGEND TO SIMILAR EFFECT AS THE
      FOREGOING.

    

    CONVERTIBLE
      NOTE

    

    FOR
      VALUE RECEIVED,
      Pure
      Capital Incorporated, a Canadian Federal corporation (the “Company”) hereby
      promises to pay _________________, (the “Holder”) on order, without demand, the
      sum of ____________________________ ($_________________) dollars, (the
“Principal Amount”) within twenty-four months from the date of this Note (the
“Maturity Date”).

    

    The
      following terms apply to this Note (“Note”):

    

    ARTICLE
      I

    GENERAL

    

    
      	1.1  	
              Conversion
                Privileges.
                The Conversion Privileges set forth in Article II shall remain in
                full
                force and effect immediately from the date hereof and until the Note
                is
                paid in full.

            

    

    

    
      	1.2  	
              Interest
                Rate.
                There shall be no interest payable due on this
                Note.

            

    

    

    ARTICLE
      II

    CONVERSION
      RIGHTS

    

    The
      Holder, within his own discretion and at his option, shall have the right to
      convert the Principal Amount into shares of the Company’s common stock as set
      forth below. If the Holder does not elect to convert the Principal Amount due
      under this Note, then the Principal Amount must be paid on or before the
      Maturity Date.

    

    
      	2.1  	
              Conversion
                of the Company’s Common Stock.

            

    

    

    (a) The
      Holder shall have the option, within his sole discretion, from and after the
      issuance of this Note, and then at any time until this Note is paid, to convert
      any outstanding and unpaid Principal portion of this Note, (the date of giving
      such notice of conversion being the “Conversion Date”) into fully paid,
      non-assessable shares of common stock of the Company as such stock exists on
      the
      date of issuance of this Note, or any shares of capital stock of the Company
      into which such stock shall hereafter be changed or reclassified, (the “Common
      Stock”) at the conversion price as defined in section 2.1(b) hereof, (the
“Conversion Price”) determined as provided herein. Upon delivery to the Company
      of a Notice of Conversion, as described in Section 4 of the Purchase Agreement
      entered into between the Company and Holder relating to this Note, (the
“Purchase Agreement”) of the Holders written request for conversion, the Company
      shall issue and deliver to the Holder within three business days from the
      Conversion Date that number of shares of Common Stock for the portion of the
      Note converted in accordance with the foregoing. The number of shares of Common
      Stock to be issued upon each conversion of this Note shall be determined by
      dividing that portion of the Principal of the Note to be converted by the
      Conversion Price.

     

    (b)  The
      Conversion Price per share shall be $0.10 per shares of the Company’s Common
      Stock or the equivalent of ___________________________________________
      (______________) shares of Common Stock. 

    

    (c)  The
      Conversion Price described in Section 2.1(b) above and the number and kind
      of
      shares or other securities to be issued upon conversion determined pursuant
      to
      Section 2.1(a) and 2.1(b), shall be subject to adjustment from time to time
      upon
      the happening of certain events while this conversion right remains outstanding
      as follows:

    

    (i) Merger,
      Sale of Assets, etc. If the Company at any time shall consolidate with, merge
      into, sell or convey all or substantially all its assets to any other
      corporation, this Note, as to the unpaid Principal portion thereof, shall
      thereafter be deemed to evidence the right to purchase such number and kind
      of
      shares or other securities and property as would have been issuable or
      distributable on account of such consolidation, merger, sale, or conveyance,
      upon or with respect to the securities subject to the conversion or purchase
      right immediately prior to such consolidation, merger, sale, or conveyance.
      The
      foregoing provision shall similarly apply to successive transactions of similar
      nature by any such successor or purchaser. Without limiting the generality
      of
      the foregoing, the provisions of Section 2.1(c)(iii) shall apply to such
      securities of such successor or purchaser after any such consolidation, merger,
      sale, or conveyance. 

    

    (ii) Reclassification,
      etc. If the Company at any time shall, by reclassification or otherwise
 change
      the Common Stock into the same or different number of securities of any class
      or
      classes, this Note,  as
      to the
      unpaid Principal portion thereof shall thereafter be deemed to evidence the
      right to purchase an  adjusted
      number of such securities and kind of securities as would have been issuable
      as
      the result of such  change
      with respect to the Common Stock immediately prior to such reclassification
      or
      other change.

    

    (iii) Stock
      Splits, Combinations and Dividends. If the shares of Common Stock are
 subdivided
      or combined into greater or smaller number of shares of Common Stock, or if
      a
      dividend is paid  on
      the
      Common Stock in shares of Common Stock, the Conversion Price shall be
      proportionately reduced  in
      the
      case of a subdivision of shares or stock dividend or proportionately increased
      in the case of a  combination
      of shares, in each such case by the ratio which the total number of shares
      of
      Common Stock  outstanding
      immediately after such event bears to the total number of shares of Common
      Stock
      outstanding  immediately
      prior to such event. 

    

    (iv) During
      the period the conversion right exists, the Company will reserve from its
 authorized
      and unissued Common Stock a sufficient number of shares to provide for the
      issuance of  Common
      Stock  upon
      the
      full conversion of this Note. The Company represents that upon issuance, such
       shares
      will be duly and validly issued, fully paid and non-assessable. The Company
      agrees that its issuance  of
      this
      Note shall constitute full authority to its, officers, agents, and transfer
      agents who are charged with  the
      duty
      of executing and issuing stock certificates to execute and issue the necessary
      certificates for shares  of
      Common
      Stock upon the conversion of this Note.

    

    2.2 Method
      of Conversion.
      This
      Note may be converted by the Holder in whole or in part as described in section
      2.1(a) hereof and the Purchase Agreement. Upon partial conversion of this Note,
      a new Note containing the same date and provisions as this Note shall, at the
      request of the Holder, be issued by the Company to the Holder for the Principal
      balance of this Note which shall not have been converted or paid.

    

    ARTICLE
      III

    MISCELLANEOUS

    

    3.1 Notices.
      Any
      notice herein required or permitted to be given shall be in writing and shall
      be
      deemed effectively given: (a) upon personal delivery to the party notified;
      (b)
      when sent by confirmed telex or facsimile if sent during normal business hours
      of the recipient, if not, then on the next business day; (c) five days after
      having been sent by registered or certified mail, return receipt requested,
      postage prepaid; or (d) one day after deposit with a nationally recognized
      overnight courier, specifying next day delivery, with written verification
      of
      receipt. All communications shall be sent to the Company at the address as
      set
      forth on the signature page to the Purchase Agreement executed in connection
      herewith and to the Holder at the address set forth on the signature page to
      the
      Purchase Agreement for such Holder, or at such other address as the Company
      or
      the Holder may designate by ten days advance written notice to the other parties
      hereto. A Notice of Conversion shall be deemed given when made to the Company
      pursuant to the Purchase Agreement.

    

    

    IN
      WITNESS WHEREOF, the
      Company has caused this Note to be signed in its name effective as of
      __________________________________, 2006.

    

    PURE
      CAPITAL INCORPORATED  ________________________
      (“Holder”)   

    

     

    

    By:_________________________________ By:__________________________________

    Name:      

    Title: 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    NOTICE
      OF CONVERSION

     

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

     

    The
      undersigned hereby elects to convert $__________________, the principal due
      on
      the Note issued by PURE CAPITAL INCORPORATED (the “Company”) on
      _________________________________, 2006 into Shares of Common Stock of the
      Company according to the conditions set forth in such Note & the related
      Securities Purchase Agreement, as of the date written below.

     

    
      	
              Date
                of Conversion:

            	
               

            
	
               

            	
               

            	
               

            
	
              Conversion
                Price:

            	
              $0.10

            
	
               

            	
               

            	
               

            
	
              Shares
                To Be Delivered:

            	
               

            
	
               

            	
               

            	
               

            
	
              Signature:

            	
               

            
	
               

            	
               

            	
               

            
	
              Print
                Name:

            	
               

            
	
               

            	
               

            	
               

            
	
              Address:Pure Cap Warrant

    

       

      

       

       

      

       

       

      

       

       

      

       

       

      

       

       

      WARRANT
        AGREEMENT BETWEEN 

       

       

      

       

       

      PURE
        CAPITAL INCORPORATED 

       

       

      

       

       

      AND 

       

       

      

       

       

      ALAN
        BROWN

       

       

       
        

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      STOCK
        PURCHASE WARRANT

       

       

      Neither
        this Warrant nor the Warrant Shares as defined herein have been registered
        under
        the Securities Act of 1933, as amended, or any applicable state securities
        laws.
        Neither this Warrant nor the Warrant Shares may be sold or transferred in
        the
        absence of such registration or any exemption from such registration. Any
        sale
        or transfer of this Warrant or the Warrant Shares must comply with the
        restrictions on transfer set forth herein.

       

       

      Right
        to
        Purchase 8,000,000 Shares of Common Stock

       

       

      Dated
        as
        of November __, 2006

       

       

      Pure
        Capital Incorporated, a Canadian Federal corporation (the “Company”),
        grants Alan Brown, an Individual residing at ______________________ (“Brown” and
        each of his successors and assigns, a “Holder”)
        a
        warrant (this “Warrant”)
        to
        purchase the Warrant Shares at the Purchase Price. Capitalized terms not
        otherwise defined have the definitions set forth in Appendix A.
        

       

       

      1.  Exercise
        and Expiration of Warrant.
        

       

       

      (a)  This
        Warrant is immediately exercisable and will expire upon the five year
        anniversary of the date hereof. “Exercise
        Period”
shall
        mean the period of time between the date hereof and the expiration of this
        Warrant in accordance with the terms hereof. 

       

       

      (b)  This
        Warrant may be exercised during the Exercise Period by the Holder, in whole
        or
        in part, by delivering this Warrant to the Company with payment of the Purchase
        Price in U.S. dollars. In lieu of such cash payment, the Holder may exercise
        the
        Warrant by delivery to the Company of written notice of an election to effect
        a
        cashless exercise for Warrant Shares pursuant to this Section 1(b) (“Cashless
        Exercise”). To effect a Cashless Exercise, the Holder will surrender this
        Warrant for that number of shares of Common Stock determined by multiplying
        the
        number of Warrant Shares to which it would otherwise be entitled by a fraction,
        the numerator if which shall be the difference between (i) the then current
        Market Price of a share of Common Stock on the date of exercise and (ii)
        the
        Purchase Price, and the denominator of which shall be the then current Market
        Price per share of Common Stock. In the event that this Warrant in not exercised
        in full immediately prior to the end of the Exercise Period and at such time
        the
        then current Market Price of a share of Common Stock is greater than the
        Purchase Price, this Warrant shall be deemed automatically exercised as to
        the
        remaining Warrant Shares as such time by Cashless Exercise without delivery
        of
        any notice from the Holder. 

       

       

      (c)  Upon
        exercise of this Warrant, the Company will issue to the Holder (i) a
        certificate or certificates for the number of full Warrant Shares to which
        the
        Holder shall be entitled upon such exercise plus the value of any fractional
        share to which the Holder would otherwise be entitled,
        and (ii) in case such exercise is in part only, a new warrant or warrants
        representing the remaining Warrant Shares. 

       

       

      (d)  Each
        exercise of this Warrant shall be deemed to have been effected immediately
        prior
        to the close of business on the day on which this Warrant shall have been
        surrendered pursuant to Section 1(b). 

       

       

      2.  Representations.
        

       

       

      (a)  By
        the
        Holder. The Holder represents and warrants to the Company as follows:

       

       

      (i)  It
        is an
“accredited investor” within the meaning of Rule 501 of the Securities Act.
        This Warrant is acquired for the Holder’s own account for investment purposes
        and not with a view to any offering or distribution within the meaning of
        the
        Securities Act of 1933 (“Securities Act”) and any applicable state securities
        laws. The Holder has no present intention of selling or otherwise disposing
        of
        the Warrant or the Warrant Shares in violation of such laws; and 

       

       

      (ii)  The
        Holder has sufficient knowledge and expertise in financial and business matters
        so as to be capable of evaluating the merits and risks of its investment
        in the
        Company. The Holder acknowledges that it has received all the information
        it
        considers necessary or appropriate for deciding whether to make this investment.
        The Holder understands that this investment involves a high degree of risk
        and
        could result in a substantial or complete loss of its investment. The Holder
        is
        capable of bearing the economic risks of such investment. 

       

       

      (iii)  This
        Warrant has been authorized by all necessary corporate action of the Holder
        and
        constitutes a valid and legally binding obligation of the Holder, enforceable
        in
        accordance with its terms. 

       

       

      The
        Holder acknowledges that the Company has indicated that the Warrant and the
        Warrant Shares have not been registered under the Securities Act by reason
        of
        their issuance in a transaction exempt from the registration requirements
        thereof, and that the Warrant Shares will bear a legend stating that such
        securities have not been registered under the Securities Act and may not
        be sold
        or transferred in the absence of such registration or an exemption from such
        registration. 

       

       

      (b)  By
        the
        Company. The Company represents and warrants that: 

       

       

      (i)  It
        (A) is a corporation duly organized, validly existing and in good standing
        under the laws of the state or province of its organization, (B) has all
        requisite power and authority to conduct its business as now conducted and
        as
        presently contemplated and to consummate the transactions contemplated hereby
        and (C) is duly qualified to do business and is in good standing in each
        jurisdiction in which the character of the properties owned or leased by
        it or
        in which the transaction of its business makes such qualification necessary.
         

       

       

      (ii) It
        has outstanding as of the date hereof but before giving effect to this Warrant,
        that number of shares of Common Stock, calculated on a fully diluted basis,
        giving effect to the conversion of all options, warrants, rights and other
        securities convertible into, or exchangeable for, Common Stock as shall be
        provided to Holder by the Company in writing as promptly as practicable
        following the date hereof. 

       

       

      (iii)  The
        execution, delivery and performance by the Company of this Warrant (A) has
        been duly authorized by all necessary corporate action, (B) does not and
        will
        not contravene the Company’s charter or bylaws or any other organizational
        document and (C) does not and will not contravene any applicable law or any
        contractual restriction binding on or otherwise affecting the Company or
        any of
        its properties or result in a default under any agreement or instrument to
        which
        the Company is a party or by which the Company or its properties may be subject.
        

       

       

      (iv)  This
        Warrant has been duly executed and delivered by the Company, and is a legal,
        valid and binding obligation of the Company, enforceable against the Company
        in
        accordance with its terms, except as may be limited by applicable bankruptcy,
        insolvency, moratorium and other laws affecting the rights of creditors
        generally and general principles of equity. 

       

       

      (v)  Assuming
        the accuracy of the representations made by the Holder in Section 2(a) hereof,
        no authorization, consent, approval, license, exemption or other action by,
        and
        no registration, qualification, designation, declaration or filing with,
        any
        governmental authority is or will be necessary in connection with the execution
        and delivery by the Company of this Warrant, the issuance by the Company
        of the
        Warrant Shares, the consummation of the transactions contemplated hereby,
        the
        performance of or compliance with the terms and conditions hereof, or to
        ensure
        the legality, validity, and enforceability hereof. 

       

       

      (vi)  The
        Company has reserved solely for issuance and delivery upon the exercise of
        this
        Warrant, such number of shares of Common Stock to provide for the exercise
        in
        full of this Warrant. 

       

       

      (vii)  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, or the filing of a prospectus qualifying the distribution,
        of this
        Warrant being issued hereby under the Securities Act or cause the issuance
        of
        this Warrant to be integrated with any prior offering of securities of the
        Company for purposes of the Securities Act. 

       

       

      3.  Certain
        Agreements of the Company.
        The
        Company agrees as follows: 

       

       

      (a)  Shares
        to
        be Fully Paid. All Warrant Shares will, upon issuance in accordance with
        the
        terms of this Warrant, be validly issued, fully paid, and nonassessable and
        free
        from all taxes, liens, claims and encumbrances.  

       

       

      (b)  Authorization
        and Reservation of Shares. During the Exercise Period, the Company shall
        have
        duly authorized a sufficient number of shares of Common Stock, free from
        preemptive rights and from any other restrictions imposed by the Company
        without
        the consent of the Holder, to provide for the exercise in full of this Warrant.
        The Company shall at all times during the Exercise Period reserve and keep
        available out of such authorized but unissued shares of Common Stock such
        number
        of shares to provide for the exercise in full of this Warrant. 

       

       

      (c)  Listing.
        In connection with the Holder’s exercise of Registration Rights hereunder, the
        Company shall use its best efforts to promptly secure the listing of the
        shares
        of Common Stock issuable upon exercise of this Warrant upon each national
        securities exchange or automated quotation system, if any, upon which shares
        of
        Common Stock are then listed or become listed (subject to official notice
        of
        issuance upon exercise of this Warrant) and shall maintain such listing for
        so
        long as any other shares of Common Stock shall be so listed. 

       

       

      (d)  Certain
        Actions Prohibited. The Company will not, by amendment of its charter or
        through
        any reorganization, transfer of assets, consolidation, merger, dissolution,
        issue or sale of securities, or any other voluntary action, avoid or seek
        to
        avoid the observance or performance of any of the terms to be observed or
        performed by it hereunder, but will at all times in good faith assist in
        the
        carrying out of all the provisions of this Warrant and in the taking of all
        such
        action as may reasonably be requested by the Holder of this Warrant in order
        to
        protect the exercise privilege of the Holder of this Warrant against dilution
        or
        other impairment, consistent with the tenor and purpose of this Warrant.
        

       

       

      (e)  Successors
        and Assigns. Except as expressly provided otherwise herein, this Warrant
        will be
        binding upon any entity succeeding to the Company by merger, consolidation,
        or
        acquisition of all or substantially all of the Company’s assets. 

       

       

      (f)  Blue
        Sky
        Laws. The Company shall, on or before the date of issuance of any Warrant
        Shares, take such actions as the Company shall reasonably determine are
        necessary to qualify the Warrant Shares for, or obtain exemption for the
        Warrant
        Shares for, sale to the Holder of this Warrant upon the exercise hereof under
        applicable securities or “blue sky” laws of the states of the United States, and
        shall provide written evidence of any such action so taken to the Holder
        of this
        Warrant prior to such date; provided, however, that the Company shall not
        be
        required to qualify as a foreign corporation or file a general consent to
        service of process in any such jurisdiction. 

       

       

      (g)  Rule 144
        Reports. For so long as the Company is subject to the reporting requirements
        of
        Section 13 or 15(d) of the Securities Exchange Act of 1934 (“Exchange Act”)
        the Company agrees to use its best efforts to take all actions reasonably
        necessary to enable the Holder to sell the Registrable Securities without
        registration under the Securities Act within the limitations of the exemptions
        provided by Rule 144 under the Securities Act, as such rule may be amended
        from
        time to time, or any similar rule or regulation hereafter adopted by the
        SEC,
        including filing on a timely basis all reports required to be filed by the
        Exchange Act. Upon the request of the Holder, the Company shall deliver to
        the
        Holder a written statement as to whether it has complied with such requirements.
         

       

       

      4.  Antidilution
        Adjustments.
        The
        Purchase Price and the number of Warrant Shares may be adjusted from time
        to
        time as set forth in Appendix
        B.
        

       

       

      5.  Registration
        Rights.
        The
        Warrant shall have the Registration Rights set forth in Appendix C.
        Notwithstanding anything to the contrary contained herein (including in
Appendix C),
        the
        Holder agrees not to exercise any of the registration rights set forth in
        Appendix C
        at any
        time that it is able to sell all of its Registrable Securities pursuant to
        Rule 144 of the Securities Act in any three (3) month period.

       

       

      6. Mergers;
        Transfer of Assets.
        If
        there shall occur any capital reorganization or reclassification of the
        Company’s Common Stock (other than a subdivision or combination as provided for
        in paragraph (b) of Appendix
        B),
        or any
        consolidation or merger of the Company with or into another corporation,
        or a
        transfer of all or substantially all of the assets of the Company, then,
        as part
        of any such reorganization, reclassification, consolidation, merger or sale,
        as
        the case may be, lawful provision shall be made so that the Holder of this
        Warrant shall have the right thereafter to receive upon the exercise hereof
        the
        kind and amount of shares of stock or other securities or property which
        such
        Holder would have been entitled to receive if, immediately prior to any such
        reorganization, reclassification, consolidation, merger or sale, as the case
        may
        be, such Holder had held the number of shares of Common Stock which were
        then
        purchasable upon the exercise of this Warrant. In any such case, appropriate
        adjustment (as reasonably determined in good faith by the Board) shall be
        made
        in the application of the provisions set forth herein with respect to the
        rights
        and interests thereafter of the Holder of this Warrant, such that the provisions
        set forth herein shall thereafter be applicable, as nearly as is reasonably
        practicable, in relation to any shares of stock or other securities or property
        thereafter deliverable upon the exercise of this Warrant. 

       

       

      7.  Transfer,
        Exchange, and Replacement 

       

       

      (a)  Transferability.
        

       

       

      (i)  The
        Holder covenants not to transfer this Warrant or the Warrant Shares except
        in
        compliance with this Section 7(a). Subject to compliance with the transfer
        restrictions set forth in clause (ii) of this Section 7(a), this Warrant
        (in whole only), the Warrant Shares (in whole or in part) and the rights
        granted
        to the Holder hereof are freely transferable upon surrender of this Warrant,
        together with an assignment form, at the office or agency of the Company
        referred to in Section 8 below. 

       

       

      (ii)  This
        Warrant shall not be transferable except (a) in whole in the event of a
        sale of the Holder, (b) in whole to any Affiliate of the Holder or
        (c) in whole to any qualified financial institution; provided that a Holder
        that is a qualified financial institution may only transfer this Warrant
        to
        another qualified financial institution. For purposes of this Section 7,
“qualified financial institution” means a registered broker-dealer or commercial
        bank organized and licensed under the laws of the United States of America
        or of
        any State thereof and having a combined capital and surplus of at least
        $300 million. The Holder shall not effect any transfer except pursuant to a
        transaction either registered, or exempt from registration, under the Securities
        Act. Prior to any transfer in reliance upon an exemption from such registration
        other than Rule 144 of the Securities Act, the Holder shall provide to the
        Company an opinion letter from counsel to the Holder (which counsel may include
        in-house counsel), reasonably satisfactory to the Company, opining that such
        transfer does not require registration under the Securities Act. The transferee,
        by acceptance of this Warrant, acknowledges that it takes such warrant subject
        to the terms and conditions hereof. Until due presentment for registration
        of
        transfer on the books of the Company, the Company may treat the registered
        Holder hereof as the owner hereof for all purposes, and the Company shall
        not be
        affected by any notice to the contrary. 

       

       

      (b)  Replacement
        of Warrant. Upon receipt of evidence reasonably satisfactory to the Company
        of
        the loss, theft, destruction, or mutilation of this Warrant and, in the case
        of
        any such loss, theft, or destruction, upon delivery of an indemnity agreement
        reasonably satisfactory in form and amount to the Company, or, in the case
        of
        any such mutilation, upon surrender and cancellation of this Warrant, the
        Company, at its expense, will execute and deliver, in lieu thereof, a new
        Warrant of like tenor. 

       

       

      (c)  Cancellation;
        Payment of Expenses. Upon the surrender of this Warrant in connection with
        any
        transfer or replacement as provided in this Section 7, this Warrant shall
        be promptly canceled by the Company. The Company shall pay all taxes (other
        than
        securities transfer taxes) and all other customary expenses (other than legal
        expenses, if any, incurred by the Holder or transferee) and charges payable
        in
        connection with the preparation, execution, and delivery of warrants pursuant
        to
        this Section 7. 

       

       

      (d)  Warrant
        Register. The Company shall maintain, at its principal executive offices
        (or
        such other office or agency of the Company as it may designate by notice
        to the
        Holder hereof), a register for this Warrant, in which the Company shall record
        the name and address of the person in whose name this Warrant has been issued,
        as well as the name and address of each transferee and each prior owner of
        this
        Warrant. 

       

       

      8.  Notices.
        Any
        notices required or permitted to be given under the terms of this Warrant
        shall
        be sent by certified or registered mail (return receipt requested) or delivered
        personally or by courier or by confirmed telecopy, and shall be effective
        five
        days after being placed in the mail, if mailed, or upon receipt or refusal
        of
        receipt, if delivered personally or by courier, or by confirmed telecopy,
        in
        each case addressed to a party. The addresses for such communications shall
        be:

       

      
        	
                If
                  to the Company:

                 

                Pure
                  Capital Incorporated

                250
                  BLAIRGOWRIE PLACE

                NANAIMO
                  A1 V9T 4P5 

                Tel.
                  (604) xxx-xxxx

                Fax
                  (604) xxx-xxxx

              	
                If
                  to Brown or Holder:

                 

                Alan
                  Brown

              
	
                With
                  a Copy to:

                 

                SteadyLaw
                  Group, LLP

                3411
                  Villa Terrace 

                San
                  Diego, CA 92104

                Tel.
                  (619) 399-3090

                Fax
                  (619) 330-1888

              	 

      

       

      If
        to any
        other Holder, at such address as such Holder shall have provided in writing
        to
        the Company, or at such other address as any Holder furnishes by notice given
        in
        accordance with this Section 8. 

       

       

      9.  Governing
        Law; Jurisdiction and Venue.
        This
        Warrant shall be governed by the laws of the State of California, without
        regard
        to conflicts or choice of law rules or principles. Each of the Company and
        the
        Holder submits to the jurisdiction and venue of the federal and state courts
        of
        San Diego, California, to resolve all issues that may arise out of or relate
        to
        this Warrant. The parties waive any right to a jury trial. 

       

       

      10.  Miscellaneous.
        

       

       

      (a)  Amendments.
        This Warrant and any provision hereof may only be amended by an instrument
        in
        writing signed by the Company and the Holder hereof. 

       

       

      (b)  U.S.
        Dollars. All references in this Warrant to “dollars”
or
        “$”
shall
        mean the U.S. dollar. 

       

       

      (c)  Fractional
        Shares. The Company shall not be required upon the exercise of this Warrant
        to
        issue any fractional shares, but shall make an adjustment therefor in cash
        on
        the basis of the fair market value per share of Common Stock, as determined
        in
        good faith by the Board. 

       

       

      (d)  Descriptive
        Headings. The descriptive headings of the several sections of this Warrant
        are
        inserted for purposes of reference only, and shall not affect the meaning
        or
        construction of any of the provisions hereof. 

       

       

      (e)  Business
        Day. For purposes of this Warrant, the term “business
        day”
means
        any day, other than a Saturday or Sunday or a day on which banking institutions
        in New York, New York or the city and state provided in Section 8 hereof
        for notices to the Company, are authorized or obligated by law, regulation
        or
        executive order to close. 

       

       

      (f)  Counterparts.
        This agreement may be executed in counterparts, and any such executed
        counterpart shall be, and shall be deemed to be, an original instrument.
        

       

       

      (g)  Severability.
        If any term, provision, covenant or restriction of this Agreement is held
        by a
        court of competent jurisdiction to be invalid, void or unenforceable, it
        shall
        be deemed replaced with a valid and enforceable provision, which comes as
        close
        as possible to the economic purpose of the invalid, void or unenforceable
        provision, and the remainder of the terms, provisions, covenants and
        restrictions of this Agreement shall remain in full force and effect and
        shall
        in no way be affected, impaired or invalidated. 

       

       

      (h)  Successors
        and Assigns. This Agreement shall be binding on, and shall inure to the benefit
        of, the parties hereto and their respective successors and assigns.

       

       

      (i)  Survival.
        The representations, warranties and covenants made by the parties hereto
        shall
        survive the execution and delivery of this Agreement.  

       

       

      (j)  No
        Stockholder Rights. Prior to the exercise of this Warrant, the Holder shall
        not
        be entitled to any rights of a stockholder with respect to the Warrant Shares,
        including without limitation the right to vote the Warrant Shares, receive
        dividends or other distributions thereon, or be notified of a stockholder
        meeting or receive any notice or communication regarding the business or
        affairs
        of the Company. 

       

       

       
        [SIGNATURE PAGE FOLLOWS]

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

           IN
        WITNESS WHEREOF, the undersigned have executed this Warrant as of the date
        first
        written above. 

       

      PURE
        CAPITAL INCORPORATED

      

      

      

      ___________________________

      By:

      Its:

      

      Dated:

      

      ALAN
        BROWN 

      

      

      ___________________________

      By:

      

      

      Dated:

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

       

       

       

      Appendix A
        — Definitions 

       

       

      “Affiliate”
shall
        mean any entity directly or indirectly controlled by, controlling or under
        common control with another entity. 

       

       

      “Board”
shall
        mean the Board of Directors of the Company. 

       

       

      “Cashless
        Exercise”
shall
        have the meaning specified in Section 1(b) of the Warrant. 

       

       

      “Company”
shall
        have the meaning specified in the initial paragraph of the Warrant.

       

       

      “Common
        Stock”
shall
        mean the common shares of the Company. 

       

       

      “Exercise
        Period”
shall
        have the meaning specified in Section 1(a) of the Warrant. 

       

       

      “Holder”
shall
        have the meaning specified in the initial paragraph of the Warrant.

       

       

      “Market
        Price”
shall
        mean the following: (i) the average of the closing sales process for the
        shares
        of Common Stock as reported on the principal trading exchange or the OTC
        BB for
        the Common Stock of the five (5) consecutive trading days immediately preceding
        such date, or if no sale price is so reported for such period, the last bid
        price for such period, or (ii) if the foregoing does not apply, the last
        sales
        price of such security in the over-the-counter market on the pink sheets
        or
        bulletin board for such security on the last trading day immediately preceding
        such date, or if no sale price is so reported for such security, the average
        of
        the last bid and ask price for such security on the last trading day immediately
        preceding such date, or (iii) if market value cannot be calculated as such
        date
        on any of the foregoing bases, the Market Price shall be the fair market
        value
        as reasonably determined by an investment banking firm selected by the Company
        and reasonably acceptable to the Holder, with the costs of the appraisal
        to be
        borne by the Company. 

       

       

      “Person”
or
        “person”
shall
        mean all natural persons, corporations, business trusts, associations,
        companies, partnerships, joint ventures, governments, agencies, political
        subdivisions and other entities. 

       

       

      “Piggyback
        Registration Right”
shall
        mean a right of the Holder under Appendix C(a) 

       

       

      “Purchase
        Price”
shall
        mean $0.10 per share of Common Stock, as may be adjusted from time to time
        pursuant to Appendix B.
 
        

       

       

      “Registrable
        Securities”
shall
        mean the Warrant Shares issued or issuable with respect to the Warrant.

       

       

      “Registration
        Expenses”
shall
        mean all expenses incident to the Company’s performance of or compliance with
        the registration provisions of Appendix C
        herein,
        including without limitation (i) all fees and expenses of compliance with
        federal securities and state securities laws; (ii) all U.S. Securities and
        Exchange Commission and state securities laws filing fees; (iii) all
        printing expenses; (iv) all fees and disbursements of counsel for the
        Company; and (v) all fees and disbursements of accountants of the Company,
        but excluding (i) underwriter’s discounts, selling commissions and stock
        transfer taxes relating to securities sold by the Selling Holder; (ii) filings
        made with the NASD and counsel fees in connection therewith; and (iii) fees
        and
        disbursements of counsel for the Selling Holder. 

       

       

      “Registration
        Rights”
shall
        mean the Piggyback, Demand and SB-2 registration rights set forth in
Appendix C.
        

       

       

      “SB-2
        Registration Right”
shall
        mean a right of the Holder under Appendix C(c).
        

       

       

      “Selling
        Holder”
shall
        have the meaning specified in Appendix
        C(d)(ii)
        of the
        Warrant. 

       

       

      “Warrant”
shall
        have the meaning specified in the initial paragraph of the Warrant.

       

       

      “Warrant
        Shares”
shall
        mean shares of Common Stock, as may be adjusted from time to time pursuant
        to
Appendix B.
         

       

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Appendix B
        — Antidilution Provisions 

       

       

      (a)
         Reserved.

       

       

      (b)  Recapitalizations.
        If outstanding shares of the Company’s Common Stock shall be subdivided into a
        greater number of shares or a dividend in Common Stock shall be paid in respect
        of Common Stock, the Purchase Price in effect immediately prior to such
        subdivision or at the record date of such dividend shall simultaneously with
        the
        effectiveness of such subdivision or immediately after the record date of
        such
        dividend be proportionately reduced. If outstanding shares of Common Stock
        shall
        be combined into a smaller number of shares, the Purchase Price in effect
        immediately prior to such combination shall, simultaneously with the
        effectiveness of such combination, be proportionately increased. See
        also
        paragraph (c) of this Appendix B (“Adjustment in Number of Warrant
        Shares”). 

       

       

      (c)  Adjustment
        in Number of Warrant Shares. When any adjustment is required to be made in
        the
        Purchase Price, the number of Warrant Shares purchasable upon the exercise
        of
        this Warrant shall be changed to the number determined by dividing (i) an
        amount equal to the number of shares issuable upon the exercise of this Warrant
        immediately prior to such adjustment, multiplied by the Purchase Price in
        effect
        immediately prior to such adjustment, by (ii) the Purchase Price in effect
        immediately after such adjustment. 

       

       

      (d)  Certificate
        of Adjustment. When any adjustment is required to be made pursuant to this
        Appendix B,
        the
        Company shall promptly mail to the Holder a certificate setting forth the
        Purchase Price after such adjustment and setting forth a brief statement
        of the
        facts requiring such adjustment. Such certificate shall also set forth the
        kind
        and amount of stock or other securities or property into which this Warrant
        shall be exercisable following such adjustment. 

       

       

      (e)  Other
        Notices. In case at any time: 

       

       

      (i)  the
        Company shall declare any dividend upon the Common Stock payable in shares
        of
        stock of any class or make any other distribution (other than dividends or
        distributions payable in cash out of retained earnings consistent with the
        Company’s past practices with respect to declaring dividends and making
        distributions) to the holders of the Common Stock; 

       

       

      (ii)  the
        Company shall offer for subscription pro rata to the holders of the Common
        Stock
        any additional shares of stock of any class or other rights; 

       

       

      (iii)  there
        shall be any capital reorganization of the Company, or reclassification of
        the
        Common Stock, or consolidation or merger of the Company with or into, or
        sale of
        all or substantially all of its assets to, another corporation or entity;
        or

       

       

      (iv)  there
        shall be a voluntary or involuntary dissolution, liquidation or winding-up
        of
        the Company; then, in each such case, the Company shall give to the Holder
        (a) notice of the date on which the books of the Company shall close or a
        record shall be taken for determining the holders of Common Stock entitled
        to
        receive any such dividend, distribution, or subscription rights or for
        determining the holders of Common Stock entitled to vote in respect of any
        such
        reorganization, reclassification, consolidation, merger, sale, dissolution,
        liquidation or winding-up and (b) in the case of any such reorganization,
        reclassification, consolidation, merger, sale, dissolution, liquidation or
        winding-up, notice of the date (or, if not then known, a reasonable estimate
        thereof by the Company) when the same shall take place. Such notice shall
        also
        specify the date on which the holders of Common Stock shall be entitled to
        receive such dividend, distribution, or subscription rights or to exchange
        their
        Common Stock for stock or other securities or property deliverable upon such
        reorganization, reclassification, consolidation, merger, sale, dissolution,
        liquidation, or winding-up, as the case may be. Such notice shall be given
        at
        least thirty (30) days prior to the record date or the date on which the
        Company’s books are closed in respect thereto. Failure to give any such notice
        or any defect therein shall not affect the validity of the proceedings referred
        to in clauses (i), (ii), (iii) and (iv) above. 

       

       

      (f)  Certain
        Events. If, at any time during the Exercise Period, any event occurs of the
        type
        contemplated by the adjustment provisions of this Appendix B
        but not
        expressly provided for by such provisions, the Company will give notice of
        such
        event, and the Board will make an appropriate adjustment in the Purchase
        Price
        and the number of shares of Common Stock acquirable upon exercise of this
        Warrant so that the rights of the Holder shall be neither enhanced nor
        diminished by such event.  

       

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Appendix C
        — Registration Rights 

       

       

      (a)  Piggyback
        Registration. 

       

       

      (i)  Participation.
        If the Company elects to file a registration statement under the Securities
        Act
        covering the offer and sale of any Common Stock (or equity securities converted
        into Common Stock) in connection with any public offering (other than a
        registration statement on Form S-8 or Form S-4, or their successors, or any
        other form for a similar limited purpose, or any registration statement covering
        only securities proposed to be issued in exchange for securities or assets
        of
        another corporation), the Company shall give written notice thereof to the
        Holder at least twenty business days before filing. The Holder shall have
        a
        Piggyback Registration Right to participate in such offering on a pro rata
        basis
        with the Company and any other Holders upon the giving of notice to the Company
        within ten business days of receipt by it of notice from the Company. If
        the
        Holder notifies the Company of its intent to exercise such Piggyback
        Registration Right, subject to (a)(ii) below, the Company shall include in
        such
        registration statement such number of shares of Registrable Securities as
        requested by the Holder. Such Registrable Securities shall be included in
        the
        underwriting for the public offering on the same terms and conditions as
        the
        securities otherwise being sold in such offering. 

       

       

      (ii)  Underwriters’
        Cutback. If, in the opinion of the managing underwriter of such offering
        the
        inclusion of all of the shares of Registrable Securities and other Common
        Stock
        requested to be registered would be inappropriate, then the number of shares
        of
        Registrable Securities and other Common Stock to be included in the offering
        shall be reduced, with the participation in such offering to be in the following
        order of priority: (1) first, securities to be issued by the Company shall
        be included, and (2) second, any other Common Stock required to be included
        pursuant to any demand registration right granted to such other holder of
        Common
        Stock shall be included, and (3) third Registrable Securities and any other
        Common Stock requested to be included, on a pro rata basis (based upon the
        number of registrable securities owned by the Holder and the holders of Common
        Stock requesting participation in the offering), shall be included.

       

       

      (iii)  Registrant
        Controls. The Company may decline to file a Registration Statement after
        giving
        notice to any Holder, or withdraw a Registration Statement after filing and
        after such notice, but prior to the effectiveness thereof, provided that
        such
        registrant shall promptly notify each Holder of Registrable Securities in
        writing of any such action and provided further that such registrant shall
        bear
        all reasonable expenses incurred by such Holder of Registrable Securities
        or
        otherwise in connection with such withdrawn Registration Statement.

       

       

      (iv)  Underwriting
        Agreement. In connection with any registration under this Section
        (a) involving an underwriting, the Company shall not be required to include
        any Registrable Shares in such registration unless the Holder accepts the
        terms
        of the underwriting as determined by the underwriters selected by the Company
        (provided that such terms must be consistent with this Agreement and provided,
        further, that any inability of the Holder to agree with the underwriters
        shall
        not restrict the ability of the Company to proceed with the registration).
        

       

       

      (b)  [Reserved]
        

       

       

      (c)  Registration
        on Form SB-2. 

       

       

      (i)  The
        Company will use its best efforts to qualify for the registration of its
        securities on Form SB-2 (or an alternative, acceptable form including only
        a
        Form 10-SB or Form SB-1). Subject to paragraph (iii) below, Holders owning
        or having the right to purchase a majority of the Registrable Securities
        may
        request on one occasion by written notice to the Company that the Company
        file a
        Registration Statement on Form SB-2 (or any successor form) for a public
        offering of Registrable Securities the reasonably anticipated aggregate price
        to
        the public of which, net of underwriting discounts and commissions, would
        exceed
        $100,000. The Company shall use its best efforts to cause such Registrable
        Shares to be registered for the offering on such form and to cause such
        Registrable Securities to be qualified in such jurisdictions as the Holder
        may
        reasonably request; provided,
        however,
        that
        the Company shall not be required to effect more than one (1) such
        registration at the request of the Holders. The Company shall prepare and
        file
        any amendments and supplements to such registration statement and the prospectus
        used in connection with such registration statement as may be necessary to
        comply with the provisions of the Securities Act with respect to the disposition
        of all the Registrable Securities. 

       

       

      (ii)  Notwithstanding
        the foregoing, the Company shall not be obligated to take any action pursuant
        to
        this section (c) during the period starting with the date sixty
        (60) days prior to the Company’s good faith estimate of the date of filing
        of, and ending on a date one hundred eighty (180) days following the
        effective date of, a Company-initiated Registration Statement that is subject
        to
        paragraph (a) of this Appendix C,
        provided
        that the
        Company is actively employing in good faith all reasonable effort to cause
        such
        Registration Statement to become effective. 

       

       

      (iii)  If
        the
        Company is requested to effect a Registration Statement on Form SB-2 and
        the
        Company furnishes to the Holders of Registrable Securities requesting such
        registration a notice certified by the President or Chief Financial Officer
        of
        the Company stating that in the good faith judgment of the Company it would
        be
        seriously detrimental to the Company and its stockholders for such registration
        statement to be filed, the Company shall have the right to defer such filing
        for
        a period of not more than 120 days after receipt of the request for such
        registration from the Holder or Holders of Registrable Securities requesting
        such registration; provided that during such time the Company may not file
        a
        registration statement (other than a registration statement on Form S-4 or
        Form
        S-8 or a registration statement already approved by the Board) for securities
        to
        be issued and sold for its own account or that of anyone other than the Holder
        or Holders of Registrable Securities requesting such registration. 

       

       

      (d)  Indemnification.
         

       

       

      (i)  Indemnification
        by the Company. The Company agrees to indemnify and hold harmless any Holder
        of
        Registrable Securities which has included Registrable Securities in a
        registration statement, its officers, directors and agents and each Person,
        if
        any, who controls such Holder within the meaning of Section 15 of the
        Securities Act or Section 20 of the Exchange Act from and against any and
        all losses, claims, damages, liabilities and expenses (including reasonable
        attorneys fees and costs of investigation) arising out of or based upon any
        untrue statement or alleged untrue statement of a material fact contained
        in any
        registration statement or final prospectus relating to the Registrable
        Securities or in any amendment or supplement thereto or in any preliminary
        prospectus, or arising out of or based upon any omission or alleged omission
        to
        state therein a material fact required to be stated therein or necessary
        to make
        the statements therein not misleading, except insofar as such losses, claims,
        damages, liabilities or expenses arise out of, or are based upon, any such
        untrue statement or omission based upon information furnished in writing
        to
        Company by the Holder of the Registrable Securities or on such Holder’s behalf
        expressly for use therein; provided, that with respect to any untrue statement
        or omission made in any preliminary prospectus, the indemnity agreement
        contained in this paragraph shall not apply to the extent that any such loss,
        claim, damage, liability or expense results from the fact that a current
        copy of
        the prospectus was not sent or given to the person asserting any such loss,
        claim, damage, liability or expense at or prior to the written confirmation
        of
        the sale of the Registrable Securities concerned if it is determined that
        it was
        the responsibility of the Holder of such Registrable Securities to provide
        such
        person with a current copy of the prospectus and such current copy of the
        prospectus would have cured the defect giving rise to such loss, claim, damage,
        liability or expense. It is agreed that the foregoing indemnity shall not
        apply
        to amounts paid in settlement of any such loss, claim, damage, liability
        or
        expense if such settlement is effected without the consent of the Company.
        The
        Company also agrees to indemnify any underwriters of the Registrable Securities,
        their officers and directors and each person who controls such underwriters
        on
        substantially the same basis as that of the indemnification of the Holder
        of
        such Registrable Securities provided in this section (d). 

       

       

      (ii)  Indemnification
        by the Holder of Registrable Securities. The Holder of Registrable Securities,
        to the extent it is selling Registrable Securities (“Selling
        Holder”),
        agrees to indemnify and hold harmless the Company, its directors and officers
        and each Person, if any, who controls the Company within the meaning of either
        Section 15 of the Securities Act or Section 20 of the Exchange Act to
        the same extent as the foregoing indemnity from the Company to the Selling
        Holder, but only with respect to, and to the extent that, information furnished
        in writing by the Selling Holder or on the Selling Holder’s behalf expressly for
        use in any registration statement or final prospectus relating to the
        Registrable Securities (or any amendment or supplement thereto, or any
        preliminary prospectus) which contained an untrue statement or alleged untrue
        statement of a material fact or omitted or allegedly omitted to state therein
        a
        material fact required to be stated therein or necessary to make the statements
        therein not misleading. It is agreed that the foregoing indemnity shall not
        apply to amounts paid in settlement of any such loss, claim, damage, liability
        or expense if such settlement is effected without the consent of the Selling
        Holder. Notwithstanding anything to the contrary contained herein, the liability
        of the Holder hereunder shall be limited to the proportion of any such loss,
        claim, damage, liability or expense that is equal to the proportion that
        the
        public offering price of the shares of Registrable Securities sold by the
        Holder
        bears to the total public offering price of all securities sold in such
        offering. The Selling Holder also agrees to indemnify and hold harmless the
        underwriters on substantially the same basis of that of the indemnification
        of
        the Company provided in the preceding subsection. 

       

       

      (e)  Contribution.
        If the indemnification provided for in this Appendix C
        is
        unavailable to the Company, the Selling Holder or the underwriters in respect
        of
        any losses, claims, damages, liabilities, expenses or judgments referred
        to
        herein, then each such indemnifying party, in lieu of indemnifying such
        indemnified party, shall contribute to the amount paid or payable by such
        indemnified party as a result of such losses, claims, damages, liabilities,
        expenses and judgments (i) as between the Company and the Selling Holder on
        the one hand and the underwriters on the other, in such proportion as is
        appropriate to reflect the relative benefits received by the Company and
        the
        Selling Holder on the one hand and the underwriters on the other from the
        offering of the Registrable Securities, or if such allocation is not permitted
        by applicable law, in such proportion as is appropriate to reflect not only
        such
        relative benefits but also the relative fault of the Company and the Selling
        Holder on the one hand and of the underwriters on the other in connection
        with
        the statements or omissions which resulted in such losses, claims, damages,
        liabilities, expenses or judgments, as well as any other relevant equitable
        considerations and (ii) as between the Company on the one hand and each
        Selling Holder on the other, in such proportion as is appropriate to reflect
        the
        relative fault of the Company and of each Selling Holder in connection with
        such
        statements or omissions, as well as any other relevant equitable considerations.
        The relative benefits received by the Company and the Selling Holder on the
        one
        hand and the underwriters on the other shall be deemed to be in the same
        proportion as the total proceeds from the offering (net of underwriting
        discounts and commissions but before deducting expenses) received by the
        Company
        and the Selling Holder bear to the total underwriting discounts and commissions
        received by the underwriters, in each case as set forth in the table on the
        cover page of the prospectus. The relative fault of the Company on the one
        hand
        and of each Selling Holder on the other shall be determined by reference
        to,
        among other things, whether the untrue or alleged untrue statement of a material
        fact or the omission or alleged omission to state a material fact relates
        to
        information supplied by such party, and the party’s relative intent, knowledge,
        access to information and opportunity to correct or prevent such statement
        or
        omission. The Company and the Holder agree that it would not be just and
        equitable if contribution pursuant to this section were determined by pro
        rata
        allocation or by any other method of allocation which does not take account
        of
        the equitable considerations referred to in the immediately preceding paragraph.
        The amount paid or payable by an indemnified party as a result of the losses,
        claims, damages, liabilities, expenses or judgments referred to in the
        immediately preceding paragraph shall be deemed to include, subject to the
        limitations set forth above, any legal or other expenses reasonably incurred
        by
        such indemnified party in connection with investigating or defending any
        such
        action or claim. Notwithstanding the provisions of this section, no underwriter
        shall be required to contribute any amount in excess of the amount by which
        the
        total price at which the Registrable Securities underwritten by it and
        distributed to the public were offered to the public exceeds the amount of
        any
        damages which such underwriter has otherwise been required to pay by reason
        of
        such untrue or alleged untrue statement or omission or alleged omission,
        and no
        Selling Holder shall be required to contribute any amount in excess of the
        amount by which the total price at which the Registrable Securities of such
        Selling Holder were offered to the public exceeds the amount of any damages
        which such Selling Holder has otherwise been required to pay by reason of
        such
        untrue or alleged untrue statement or omission or alleged omission. No person
        guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
        of
        the Securities Act) shall be entitled to contribution from any person who
        was
        not guilty of such fraudulent misrepresentation. 

       

       

      (f)  Registration
        Expenses and Enforcement. 

       

       

      (i)  Registrations
        Rights. The Company shall bear all Registration Expenses incurred in connection
        with Piggyback Registration Rights, the Demand Registration Right and the
        SB-2
        Registration Right. 

       

       

      (ii)  Expenses
        of Registrant. The Company shall pay its internal expenses (including, without
        limitation, all salaries and expenses of its officers and employees performing
        legal or accounting duties), the expense of any annual audit, the fees and
        expenses incurred in connection with any listing of the securities to be
        registered on a securities exchange, and the fees and expenses of any person,
        including special experts, retained by the Company. 

       

       

      (iii)  Enforcement
        of Registration Rights. Notwithstanding anything to the contrary contained
        herein, the Company hereby agrees that each Holder of Registrable Securities
        shall be entitled to specific performance of the registration rights hereunder.
        

       

       

      (g)  Assignment
        of Registration Rights. Any of the rights of the Holders under this
        Appendix C, including the right to have the Company register Registrable
        Securities pursuant to this Agreement, may be assigned by each Holder to
        any
        permitted transferee if: (i) the Holder agrees in writing with the
        transferee or assignee to assign such rights, and a copy of such agreement
        is
        furnished to the Company after such assignment, (ii) the Company is
        furnished with written notice of (A) the name and address of such
        transferee or assignee, and (B) the securities with respect to which such
        registration rights are being transferred or assigned, (iii) following such
        transfer or assignment, the further disposition of such securities by the
        transferee or assignee is restricted under the Securities Act and applicable
        state securities laws, and (iv) such transfer shall have been made in
        accordance with the applicable requirements of the Warrant. The transferee,
        by
        acceptance of the transfer of any registration rights hereunder, acknowledges
        that it takes such rights subject to the terms and conditions hereof. Upon
        any
        transfer of less than all of its Registrable Securities, the Holder retains
        registration rights with respect to Registrable Securities held by
        it.

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