Document:

Exhibit
      10.9

    

    SUPPLY
      CONTRACT

    (English
      Translation)

    

    This
      agreement is entered into by and between Perfectenergy (Shanghai), Ltd.
(hereinafter,
      known as "Party A") and
      Shanghai Solar Power Technology Research Center (hereinafter,
      known as "Party B")
      in
      accordance with the Economic
      Contract Laws of the People's Republic of China.
      This
      contract is the product of coordination and negotiationsbetween the two
      parties.

    

    The
      product mentioned below will be supplied by Party A to Party B. Both parties
      also agree to the following:

    

    	1.  	
            Content
              of supply

          

    	1)  	
            125
              mm x 125 mm monocrystalline silicon solar modular with
              coating

          

    	2)  	
            125
              mm x 125 mm monocrystalline silicon solar film battery (average efficiency
              16%)

          

    

    	2.  	
            Pricing

          

    	1)  	
            Party
              A charges 51.50 RMB/piece for each silicon chip with
              coating.

          

    	2)  	
            Party
              A charges 27 RMB/watt for each solar film
              battery

          

    

    	3.  	
            Specifications

          

    Specifications
      must follow the technical agreement signed by both parties.

    

    	4.  	
            Supply
              quantities

          

    	1)  	
            Per
              request, Party A to supply 150,000 pieces to 200,000 pieces of coated
              silicon to Party B on a monthly basis.

          

    	2)  	
            Per
              request, Party A to supply 100,000 pieces of solar film battery to
              Party B
              on a monthly basis. 

          

    

    	5.  	
            Delivery

          

    Per
      Party
      B’s request, Party A to deliver the finished goods one week after receiving
      Party B’s order.

    

    	6.  	
            Payment
              terms

          

    Party
      B
      to pay Party A three days after the order is issued.

    

    	7.  	
            Packaging
              requirements

          

    Party
      A’s
      packaging must comply with public transportation regulations.

    

    	8.  	
            Place
              of delivery

          

    The
      goods
      shall be delivered to the factory specified by Party B. Party A is responsible
      for transportation costs. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
 

    	9.  	
            Product
              inspection

          

    	1)
              	
            After
              receiving the products, and within five business days of receipt, Party
              B
              will inspect the quantity and quality based on the specifications listed
              in this contract. If there is anything that does not match the contract,
              Party B shall notify Party A in writing. No written feedback from Party
              B
              shall be regarded as Party B’s acceptance and approval of all the goods.
              

          

    	2)
              	
            For
              any silicon chip that does not meet the specifications listed in the
              contract, Party B may request from Party A a refund for the corresponding
              defective good(s), or a replacement of products that meet the quality
              standard. 

          

    	3)
              	
            The
              ratio of broken chips upon opening the carton shall not be higher than
              1%.

          

    

    	10.  	
            Dispute
              resolution

          

    If
      there
      is any dispute during the term of this contract, both parties shall attempt
      to
      resolve the dispute through negotiations. If the dispute remains unresolved,
      a
      lawsuit may be filed in a court where this contract is established, and the
      court’s decision shall govern.

    

    	11.  	
            Others

          

    	1)
              	
            Any
              topics or terms that are not covered in this contract shall be reviewed
              and negotiated by both parties.

          

    	2)
              	
            This
              contract will not come into force until signed by both parties with
              stamps. Each party will hold one copy of this contract.
              

          

    	3)
              	
            A
              fax copy of this contract with signature is also effective.
              

          

    	4) 
             	
            Each
              representative of Party A and Party B are authorized by such party
              to
              ensure the execution of this contract. 

          

    

    

    
      	
              Party
                A:

            	
              Party
                B:

            
	
              Perfectengergy
                (Shanghai), Ltd.

            	
              Shanghai
                Solar Power Technology 

            
	
              No.
                479 East Xinzhuang Road,

            	
              Research
                Center

            
	
              Shanghai,
                China 201108

            	
              No.
                555 South Xinzhuang Road,

            
	
            	
              Shanghai,
                China 201108

            
	 	 
	
              Signature

            	
              Signature

            
	 	 
	 	 
	
              Date

            	
              Date
                

            
	 	 
	 	 
	
              Stamp

            	
              StampLOAN
      AGREEMENT

    (English
      Translation of Original Contract in Chinese)

    

    This
      Agreement is entered into by the following:

    

    Party
      A:
      Zhou Diping

    

    Party
      B:
      PerfectEnergy (Shanghai) Company Limited

    

    The
      parties hereto freely enter into this Agreement regarding loan by Party A to
      Party B, and agree as follows:

    

    	1.   
              	
            To
              alleviate Party B’s cash flow pressure relating to its manufacturing
              operation, Party A agrees to loan Party B the sum of RMB
              200,000.

          

    

    	2.    
             	
            Party
              B agrees to borrow from Party A the sum of money described above, and
              further agrees to pay Party A interest at the rate of 7.2% per
              annum.

          

    

    	3.   
              	
            Party
              A shall transfer the entire sum in one payment into Party B’s account, and
              the parties jointly agree that interest will begin to accrue on
              2/25/2006.

          

    

    	4.   
              	
            Term
              of the Loan: From 2/25/2006 to 2/24/2007. At the end of the Term, Party
              B
              shall repay the entire loan in one
              payment.

          

    

    	5.   
              	
            Payment
              of Interest: Party B shall make interest payment once per
              quarter.

          

    

    	6.    
             	
            Any
              issues not addressed by this Agreement shall be resolved by the parties
              amicably.

          

    

    	7.    
             	
            This
              Agreement shall be in 2 copies, 1 copy to each party, and shall take
              effect upon the parties’ signatures and stamp.

          

     

    

      
        	
                Party
                  A: Zhou Diping

              	
                Party
                  B: PerfectEnergy (Shanghai) Co.

              
	 	 
	 	 
	
                Signature:

              	
                Signature:

              
	 	 
	 	 
	
                Stamp:

              	
                Stamp:

              
	 	 
	 	 
	
                Date:Securities
      Purchase Agreement

     

    

    PerfectEnergy
      International Limited

    7401
      Springbank Blvd., Suite 3

    Calgary,
      Alberta T3H 5R2

    

     

    The
      undersigned (the “Investor”)
      hereby
      confirms its agreement with you as follows:

     

    1.  This
      Securities Purchase Agreement is made as of the date set forth below between
      PerfectEnergy
      International Limited,
      a
      Nevada corporation (the “Company”),
      and
      the Investor.

     

    2.  The
      Company has authorized the sale and issuance of up to [______________] shares
      (the “Shares”)
      of the
      Common Stock of the Company, par value $0.001 per share (the “Common
      Stock”),
      to
      certain investors in a private placement, along with warrants (the “Warrants”)
      to
      purchase up to _________ shares (the “Warrant
      Shares”)
      of
      Common Stock at an exercise price of $________ (the “Offering”).

     

    3.  The
      Company and the Investor agree that the Investor will purchase from the Company
      and the Company will issue and sell to the Investor ___________ Shares at a
      purchase price of $[_______] per Share, along with Warrants to purchase _____
      Shares for an aggregate purchase price of $____________________ (the
“Purchase
      Price”),
      subject to the Terms and Conditions for Purchase of Shares attached hereto
      as
      Annex I and incorporated herein by reference as if fully set forth herein.
      Unless otherwise requested by the Investor in Exhibit
      A,
      certificates representing the Shares purchased by the Investor and Warrants
      will
      be registered in the Investor’s name and address as set forth below. The Company
      and the Investor agree to enter into a registration rights agreement (the
“Registration
      Rights Agreement”)
      in the
      form of Exhibit
      B
      concurrently with the execution of this Securities Purchase
      Agreement.

     

    4.  The
      Investor represents that, except as set forth below, (a) it has had no position,
      office or other material relationship within the past three years with the
      Company or its affiliates, (b) neither it, nor any group of which it is a member
      or to which it is related, beneficially owns (including the right to acquire
      or
      vote) any securities of the Company, and (c) it has no direct or indirect
      affiliation or association with any NASD, Inc. (“NASD”)
      member. Exceptions:

     

    (If
      no
      exceptions, write “none.” If left blank, response will be deemed to be
“none.”)

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

     

    

      
        	 	 	 
	 	
                Dated
                  as of:
                  _________________, 2007

              
	 	 	 
	 	 
	 	
                [Investor
                  Name]

              
	 	 	 
	 	
                By:

              	 
	 	
                 

              	
                Name:

              
	 	
                 

              	
                Title:

              
	 	 	 
	 	 	 
	 	
                Address:

              	 
	 	 
	 	 

      

    

     

     

    AGREED
      AND ACCEPTED:

    

    PERFECTENERGY
      INTERNATIONAL LIMITED

    

    

    
      	By:
              	 	 
	 	 Name:	 
	 	 Title:	 

    

     

     

    [SECURITIES
      PURCHASE AGREEMENT SIGNATURE PAGE]

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    
      

      Annex
        I

       

      Terms
        and Conditions for Purchase of Shares

       

      1.  Agreement
        to Sell and Purchase the Shares; Subscription Date.

       

      1.1  Purchase
        and Sale.
        At the
        Closing (as defined in Section 2), the Company will sell to the Investor,
        and
        the Investor will purchase from the Company, upon the terms and subject to
        the
        conditions set forth herein, and at the Purchase Price, the number of Shares
        and
        Warrants described in paragraph 3 of the Securities Purchase Agreement attached
        hereto (collectively with this Annex I and the other exhibits attached hereto,
        this “Agreement”).
        

       

      1.2  Other
        Investors.
        As part
        of the Offering, the Company proposes to enter into Securities Purchase
        Agreements in the same form as this Agreement with certain other investors
        (the
“Other
        Investors”),
        and
        the Company expects to complete sales of Shares to them. The Investor and
        the
        Other Investors are sometimes collectively referred to herein as the
“Investors,”
and
        this Agreement, the Registration Rights Agreement and the Securities Purchase
        Agreements executed by the Other Investors are sometimes collectively referred
        to herein as the “Agreements.”
The
        Company may accept executed Agreements from Investors for the purchase of
        Shares
        and Warrants commencing upon the date on which the Company provides the
        Investors with the proposed purchase price per Share and concluding upon
        the
        date (the “Subscription
        Date”)
        on
        which the Company has notified Canaccord Adams or Knight Capital Markets
        LLC
        (each , in its capacity as placement agent for the Shares, the “Placement
        Agent”)
        in
        writing that it will no longer accept Agreements for the purchase of Shares
        in
        the Offering, but in no event shall the Subscription Date be later than July
        [___],
        2007.
        Each Investor must execute and deliver a Securities Purchase Agreement and
        a
        Registration Rights Agreement and must complete a Stock Certificate
        Questionnaire (in the form attached as Exhibit
        A
        hereto)
        and an Investor Questionnaire (in the form attached as Exhibit
        C
        hereto)
        in order to purchase Shares and Warrants in the Offering.

       

      1.3  Placement
        Agent Fee.
        The
        Investor acknowledges that the Company intends to pay to the Placement Agents
        a
        fee, plus certain expenses, in respect of the sale of Shares and Warrants
        to the
        Investor. 

       

      2.  Delivery
        of the Shares at Closing. The
        completion of the purchase and sale of the Shares and Warrants (the
“Closing”)
        shall
        occur on a date specified by the Company and the Placement Agent (the
“Closing
        Date”),
        which
        date shall not be later than July [__],
        2007
        (the “Outside
        Date”),
        and
        of which the Investors will be notified in advance by a Placement Agent.
        At the
        Closing, the Company shall deliver to the Investor one or more stock
        certificates representing the number of Shares set forth in paragraph 3 of
        the
        Securities Purchase Agreement, each such certificate to be registered in
        the
        name of the Investor or, if so indicated on the Stock Certificate Questionnaire
        attached hereto as Exhibit
        A,
        in the
        name of a nominee designated by the Investor, along with a Warrant registered
        in
        the same name. In exchange for the delivery of the stock certificates
        representing such Shares and the Warrant , the Investor shall deliver the
        Purchase Price to the Company by wire transfer of immediately available funds
        pursuant to the Company’s written instructions. On the Closing Date, the Company
        shall cause counsel to the Company to deliver to the Investors and the Placement
        Agents a legal opinion, dated the Closing Date, substantially in the form
        attached hereto as Exhibit
        D
        (the
“Legal
        Opinion”).
        

       

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      

       

      The
        Company’s obligation to issue and sell the Shares and Warrants to the Investor
        shall be subject to the following conditions, any one or more of which may
        be
        waived by the Company: (a) prior receipt by the Company of a copy of this
        Agreement executed by the Investor; (b) completion of purchases and sales
        of
        Shares and Warrants under the Agreements with the Other Investors; (c) the
        accuracy of the representations and warranties made by the Investor in this
        Agreement and the fulfillment of the obligations of the Investor to be fulfilled
        by it under this Agreement on or prior to the Closing;
        and (d)
        the absence of any order, writ, injunction, judgment or decree that questions
        the validity of the Agreements or the right of the Company or the Investor
        to
        enter into such Agreements or to consummate
        the
        transactions contemplated hereby
        and thereby.

       

      The
        Investor’s obligation to purchase the Shares and Warrants shall be subject to
        the following conditions, any one or more of which may be waived by the
        Investor: (a) the completion of purchases and sales under the Agreements
        with
        the Other Investors for an aggregate purchase price of not less than
[__________________
        dollars ($_____________)];
        (b) the
        delivery of the Legal Opinion to the Investor by counsel to the Company;
        (c) the
        accuracy of the representations and warranties made by the Company in this
        Agreement on the date hereof and, if different, on the Closing Date; (c)
        the
        execution and delivery by the Company of the Registration Rights Agreement,
        (d)
        the fulfillment of the obligations of the Company to be fulfilled by it under
        this Agreement on or prior to the Closing; (e) the absence of any order,
        writ,
        injunction, judgment or decree that questions the validity of the Agreements
        or
        the right of the Company or the Investor to enter into such Agreements or
        to
        consummate the transactions contemplated hereby and thereby; and (f) the
        delivery to the Investor by the Secretary or Assistant Secretary of the Company
        of a certificate stating that the conditions specified in this paragraph
        have
        been fulfilled. In the event that the Closing does not occur on or before
        the
        Outside Date as a result of the Company’s failure to satisfy any of the
        conditions set forth above (and such condition has not been waived by the
        Investor), the Company shall return any and all funds paid hereunder to the
        Investor no later than one Business Day following the Outside Date and the
        Investors shall have no further obligations hereunder. For purposes of this
        Agreement, “Business
        Day”
shall
        mean any day other than a Saturday, Sunday or other day on which the New
        York
        Stock Exchange or commercial banks located in New York, New York are permitted
        or required by law to close.

       

      3.  Representations,
        Warranties and Covenants of the Company.
        Except
        as otherwise described in the Company’s Annual Report on Form 10-KSB for the
        year ended October 31, 2006 filed on February 13, 2007 (and any amendments
        thereto filed at least two (2) Business Days prior to the date hereof), the
        Company’s Quarterly Reports on Form 10-QSB filed on March 26, 2007 and June 19,
        2007 for the quarterly periods ended January 31, 2007 and April 30, 2007,
        respectively, or any of the Company’s Current Reports on Form 8-K filed since
        June 19, 2007 and at least two (2) Business Days prior to the date hereof
        (collectively, the “SEC
        Reports”),
        the
        Company hereby represents and warrants to, and covenants with, the Investor
        as
        of the date hereof and the Closing Date, as follows:

       

      3.1  Organization.
        The
        Company is duly incorporated and validly existing in good standing under
        the
        laws of the State of Nevada. The Company has full power and authority to
        own,
        operate and occupy its properties and to conduct its business as presently
        conducted and is registered or qualified to do business and in good standing
        in
        each jurisdiction in which it owns or leases property or transacts business
        and
        where the failure to be so qualified would have a material adverse effect
        upon
        the Company and its subsidiaries as a whole or the business, financial
        condition, properties, operations or assets of the Company and its subsidiaries
        as a whole or the Company’s ability to perform its obligations under the
        Agreements in all material respects (“Material
        Adverse Effect”),
        and
        no proceeding has been instituted in any such jurisdiction revoking, limiting
        or
        curtailing, or seeking to revoke, limit or curtail, such power and authority
        or
        qualification. The Company has no “subsidiaries” (as defined in Rule 405 under
        the Securities Act of 1933, as amended (the “Securities
        Act”)),
        other than as set forth in its most recent From 10_KSB.

       

      

      
        
          
            
            

          

          
            2

            
              

            

          

          
            
            

          

        

      

      

      

       

      3.2  Due
        Authorization. The
        Company has all requisite power and authority to execute, deliver and perform
        its obligations under the Agreements. The execution and delivery of the
        Agreements, and the consummation by the Company of the transactions contemplated
        hereby, have been duly authorized by all necessary corporate action and no
        further action on the part of the Company or its Board of Directors or
        stockholders is required. The Agreements have been validly executed and
        delivered by the Company and constitute legal, valid and binding agreements
        of
        the Company enforceable against the Company in accordance with their terms,
        except to the extent (i) rights to indemnity and contribution may be limited
        by
        state or federal securities laws or the public policy underlying such laws,
        (ii)
        such enforceability may be limited by applicable bankruptcy, insolvency,
        reorganization, moratorium or similar laws affecting creditors’ and contracting
        parties’ rights generally and (iii) such enforceability may be subject to
        general principles of equity (regardless of whether such enforceability is
        considered in a proceeding in equity or at law).

       

      3.3  Non-Contravention.
        The
        execution and delivery of the Agreements, the issuance and sale of the Shares
        and Warrants to be sold by the Company under the Agreements, the fulfillment
        of
        the terms of the Agreements and the consummation of the transactions
        contemplated thereby, including the issuance of the Warrant Shares in accordance
        with the terms of the Warrants, will not (A) result in a conflict with or
        constitute a violation of, or default (with the passage of time or otherwise)
        under, (i) any bond, debenture, note or other evidence of indebtedness, or
        any material lease,
        contract, indenture, mortgage, deed of trust, loan agreement, joint venture
        or
        other agreement or instrument to which the Company or any subsidiary (each,
        a
“Subsidiary”
        and
        collectively, the “Subsidiaries”)
        is a
        party or by which the Company or the Subsidiaries or their respective properties
        are bound, (ii) the Certificate of Incorporation, Bylaws, or other
        organizational documents of the Company, as amended, or (iii) any law,
        administrative regulation, ordinance or order of any court or governmental
        agency, arbitration panel or authority binding upon the Company or any
        Subsidiary or their respective properties, which conflict, violation or default,
        individually or in the aggregate, is reasonably likely to have a Material
        Adverse Effect, or (B) result in the creation or imposition of any lien,
        encumbrance, claim, security interest or restriction whatsoever upon any
        of the
        material properties or assets of the Company or the Subsidiaries or an
        acceleration of indebtedness pursuant to any obligation, agreement or condition
        contained in any material bond, debenture, note or any other evidence of
        indebtedness or any material indenture, mortgage, deed of trust or any other
        agreement or instrument to which the Company or any Subsidiary is a party
        or by
        which it is bound or to which any of the property or assets of the Company
        is
        subject. No consent, approval, authorization or other order of, or registration,
        qualification or filing with, any regulatory body, administrative agency,
        or
        other governmental body is required for the execution and delivery of the
        Agreements by the Company and the valid issuance or sale of the Shares by
        the
        Company pursuant to the Agreements, other than such as have been made or
        obtained, and except for any filings required to be made under federal or
        state
        securities laws.

       

      3.4  Capitalization.
        The
        authorized capital stock of the Company as of July [__], 2007 consists of
        377,000,000 shares of Common Stock, of which [69,707,300]
        shares
        are outstanding and 10,000,000 shares of Preferred Stock, of which 0 shares
        are
        outstanding. The Company has not issued any capital stock since October 25,
        2007, other than pursuant to the purchase
        of shares under the Company’s long term incentive plans and the exercise
        of outstanding warrants or stock options, in each case as disclosed in the
        SEC
        Reports. The Shares, Warrants and Warrant Shares to be sold pursuant to the
        Agreements have been duly authorized, and when issued and paid for in accordance
        with the terms of the Agreements and the Warrants, will be duly and validly
        issued, fully paid and nonassessable, subject to no lien, claim or encumbrance
        (except
        for any such lien, claim or encumbrance created,
        directly or indirectly, by the Investor). The outstanding shares of capital
        stock of the Company have been duly and validly issued and are fully paid
        and
        nonassessable, have been issued in compliance with the registration requirements
        of federal and state securities laws, and were not issued in violation of
        any
        preemptive rights or similar rights to subscribe for or purchase securities.
        The
        Company owns all of the outstanding capital stock of each Subsidiary, free
        and
        clear of all liens, claims and encumbrances. There are no outstanding rights
        (including, without limitation, preemptive rights), warrants or options to
        acquire, or instruments convertible into or exchangeable for, any unissued
        shares of capital stock or other equity interest in the Company or any
        Subsidiary, or any contract, commitment, agreement, understanding or arrangement
        of any kind to which the Company or any Subsidiary is a party and providing
        for
        the issuance or sale of any capital stock of the Company or of any Subsidiary,
        any such convertible or exchangeable securities or any such rights, warrants
        or
        options. Without limiting the foregoing, no preemptive right, co-sale right,
        registration right, right of first refusal or other similar right exists
        with
        respect to the issuance and sale of the Shares, except as provided in the
        Agreements. There are no shareholders agreements, voting agreements or other
        similar agreements with respect to the Common Stock to which the Company
        is a
        party. 

       

      

      
        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

        

      

      

      

       

      3.5  Legal
        Proceedings. There
        is
        no material legal or governmental proceeding pending, or to the knowledge
        of the
        Company, threatened, to which the Company or any Subsidiary is a party or
        of
        which the business or property of the Company or any Subsidiary is subject
        that
        is required to be disclosed and that is not so disclosed in the SEC Reports.
        Neither the Company nor any Subsidiary is subject to any injunction, judgment,
        decree or order of any court, regulatory body, administrative agency or other
        government body.

       

      3.6  No
        Violations. Neither
        the Company nor any Subsidiary is in violation of its Certificate of
        Incorporation, Bylaws or other organizational documents, as amended, or in
        violation of any law, administrative regulation, ordinance or order of any
        court
        or governmental agency, arbitration panel or authority applicable to the
        Company, which violation, individually or in the aggregate, is reasonably
        likely
        to have a Material Adverse Effect, and neither the Company nor any Subsidiary
        is
        in default (and there exists no condition which, with the passage of time
        or
        otherwise, would constitute a default) in the performance of any bond,
        debenture, note or any other evidence of indebtedness or any indenture,
        mortgage, deed of trust or any other material agreement or instrument to
        which
        the Company or any Subsidiary is a party or by which the Company or such
        Subsidiary or their respective properties are bound, which default is reasonably
        likely to have a Material Adverse Effect.

       

      3.7  Governmental
        Permits, Etc. Each
        of
        the Company and the Subsidiaries has all necessary franchises, licenses,
        certificates and other authorizations from any foreign, federal, state or
        local
        government or governmental agency, department or body that are currently
        necessary for the operation of the business of the Company and the Subsidiaries
        as currently conducted, except where the failure to currently possess such
        franchises, licenses, certificates and other authorizations is not reasonably
        likely to have a Material Adverse Effect.

       

      3.8  Intellectual
        Property.

       

      (a)  Except
        for matters which are not reasonably likely to have a Material Adverse Effect,
        (i) each of the Company and the Subsidiaries has ownership of, or a license
        or
        other legal right to use, all patents, copyrights, trade secrets, trademarks,
        customer lists, designs, manufacturing or other processes, computer software,
        systems, data compilation, research results or other proprietary rights used
        in
        the business of the Company (collectively, “Intellectual
        Property”)
        and
        (ii) all of the Intellectual Property owned by the Company or by the
        Subsidiaries consisting of patents, registered trademarks and registered
        copyrights have been duly registered in, filed in or issued by the United
        States
        Patent and Trademark Office, the United States Register of Copyrights or
        the
        corresponding offices of other jurisdictions and have been maintained and
        renewed in accordance with all applicable provisions of law and administrative
        regulations in the United States and/or such other jurisdictions.

       

      

      
        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

      

      

      

       

      (b)  Except
        for matters which are not reasonably likely to have a Material Adverse Effect,
        all material licenses or other material agreements under which (i) the Company
        or any Subsidiary employs rights in Intellectual Property, or (ii) the Company
        or any Subsidiary has granted rights to others in Intellectual Property owned
        or
        licensed by the Company or any Subsidiary are in full force and effect, and
        there is no default by the Company with respect thereto.

       

      (c)  The
        Company believes that it has taken all steps reasonably required in accordance
        with sound business practice and business judgment to establish and preserve
        the
        ownership of all material Intellectual Property owned by the Company or any
        Subsidiary.

       

      (d)  Except
        for matters which are not reasonably likely to have a Material Adverse Effect,
        to the knowledge of the Company, (i) the present business, activities and
        products of the Company or any Subsidiary do not infringe any intellectual
        property of any other person; (ii) neither the Company nor any Subsidiary
        is
        making unauthorized use of any confidential information or trade secrets
        of any
        person; and (iii) the activities of any of the employees of the Company or
        any
        Subsidiary, acting on behalf of the Company or such Subsidiary, do not violate
        any agreements or arrangements related to confidential information or trade
        secrets of third parties.

       

      (e)  No
        proceedings are pending, or to the knowledge of the Company, threatened,
        which
        challenge the rights of the Company or any Subsidiary to the use of Intellectual
        Property, except for matters which are not reasonably likely to have a Material
        Adverse Effect.

       

      3.9  Financial
        Statements. The
        financial statements of the Company and the related notes contained in the
        SEC
        Reports present fairly and accurately in all material respects the financial
        position of the Company as of the dates therein indicated, and the results
        of
        its operations, cash flows and the changes in shareholders’ equity for the
        periods therein specified, subject, in the case of unaudited financial
        statements for interim periods, to normal year-end audit adjustments. Such
        financial statements (including the related notes) have been prepared in
        accordance with generally accepted accounting principles applied on a consistent
        basis at the times and throughout the periods therein specified, except that
        unaudited financial statements may not contain all footnotes required by
        generally accepted accounting principles. 

       

      3.10  No
        Material Adverse Change.
        Except
        as disclosed in the SEC Reports or
        in any
        press releases issued by the Company
        at least two (2) Business Days prior to the date of this Agreement,
        since
        April 30, 2007, there has not been (i) an event, circumstance or change
        that has had or is reasonably likely to have a Material Adverse Effect, (ii)
        any
        obligation incurred by the Company or any Subsidiary, direct or contingent,
        that
        is material to the Company, (iii) any dividend or distribution of any kind
        declared, paid or made on the capital stock of the Company, or (iv) any loss
        or
        damage (whether or not insured) to the physical property of the Company or
        any
        Subsidiary which has had a Material Adverse Effect. 

       

      3.11  Reporting
        Status.
        The
        Company has timely made all filings required under the Exchange Act during
        the
        twelve (12) months preceding the date of this Agreement, and all of those
        documents complied in all material respects with the SEC’s requirements as of
        their respective filing dates, and the information contained therein as of
        the
        respective dates thereof did not contain an untrue statement of a material
        fact
        or omit to state a material fact required to be stated therein or necessary
        to
        make the statements therein in light of the circumstances under which they
        were
        made not misleading. 

       

      3.12  No
        Manipulation; Disclosure of Information. The
        Company has not taken and will not take any action designed to or that might
        reasonably be expected to cause or result in an unlawful manipulation of
        the
        price of the Common Stock to facilitate the sale or resale of the Shares.
        The
        Company has not disclosed any material non-public information to the
        Investors.

       

      

      
        
          
            
            

          

          
            5

            
              

            

          

          
            
            

          

        

      

      

      

       

      3.13  Accountants.  Jewett,
        Schwartz, Wolf & Associates,
        who
        expressed their opinion with respect to the consolidated financial statements
        in
        the Company’s Annual Report on Form 10-KSB for the year ended October 31, 2006,
        have advised the Company that they are, and to the knowledge of the Company
        they
        are, independent accountants as required by the Securities Act and the rules
        and
        regulations promulgated thereunder.

       

      3.14  Contracts.
        Except
        for matters which are not reasonably likely to have a Material Adverse Effect
        and those contracts that are substantially or fully performed or expired
        by
        their terms, the contracts listed as exhibits to or described in the SEC
        Reports
        that are material to the Company and all amendments thereto, are in full
        force
        and effect on the date hereof, and neither the Company nor, to the Company’s
        knowledge, any other party to such contracts is in breach of or default under
        any of such contracts.

       

      3.15  Taxes.
        Except
        for matters which are not reasonably likely to have a Material Adverse Effect,
        each of the Company and the Subsidiaries has filed all necessary federal,
        state
        and foreign income and franchise tax returns and has paid or accrued all
        taxes
        shown as due thereon, and the Company has no knowledge of a tax deficiency
        which
        has been asserted or threatened against the Company or any
        Subsidiary.

       

      3.16  Transfer
        Taxes.
        On the
        Closing Date, all stock transfer or other taxes (other than income taxes)
        which
        are required to be paid in connection with the sale and transfer of the Shares
        hereunder will be, or will have been, fully paid or provided for by the Company
        and the Company will have complied with all laws imposing such
        taxes.

       

      3.17  Investment
        Company.
        The
        Company is not an “investment company” or an “affiliated person” of, or
“promoter” or “principal underwriter” for an investment company, within the
        meaning of the Investment Company Act of 1940, as amended, and will not be
        deemed an “investment company” as a result of the transactions contemplated by
        this Agreement.

       

      3.18  Reserved.

       

      3.19  Offering
        Prohibitions.
        Neither
        the Company nor any person acting on its behalf or at its direction has in
        the
        past or will in the future take any action to sell, offer for sale or solicit
        offers to buy any securities of the Company which would bring the offer or
        sale
        of the Shares or Warrants as contemplated by this Agreement within the
        provisions of Section 5 of the Securities Act. 

       

      3.20  Related
        Party Transactions. To
        the
        knowledge of the Company, no transaction
        has occurred between or among the Company or any of its affiliates, officers
        or
        directors or any affiliate or affiliates of any such officer or director
        that
        with the passage of time will be required to be disclosed pursuant to Section
        13, 14 or 15(d) of the Exchange Act. 

       

      3.21  Books
        and Records.
        The
        books, records and accounts of the Company accurately and fairly reflect,
        in
        reasonable detail, the transactions in, and dispositions of, the assets of,
        and
        the operations of, the Company. The Company maintains a system of internal
        accounting controls sufficient to provide reasonable assurances that (i)
        transactions are executed in accordance with management’s general or specific
        authorizations, (ii) transactions are recorded as necessary to permit
        preparation of financial statements in accordance with generally accepted
        accounting principles and to maintain asset accountability, (iii) access
        to
        assets is permitted only in accordance with management’s general or specific
        authorization and (iv) the recorded accountability for assets is compared
        with
        the existing assets at reasonable intervals and appropriate action is taken
        with
        respect to any differences. 

       

      

      
        
          
            
            

          

          
            6

            
              

            

          

          
            
            

          

        

      

      

      

       

      4.  Representations,
        Warranties and Covenants of the Investor.

       

      4.1  Investor
        Knowledge and Status.
        The
        Investor represents and warrants to, and covenants with, the Company that:
        (i)
        the Investor is an “accredited investor” as defined in Regulation D under the
        Securities Act, is knowledgeable, sophisticated and experienced in making,
        and
        is qualified to make decisions with respect to, investments in securities
        presenting an investment decision similar to that involved in the purchase
        of
        the Shares and Warrants, and has requested, received, reviewed and considered
        all information it deemed relevant in making an informed decision to purchase
        the Shares and Warrants; (ii) the Investor understands that the Shares and
        Warrants are each “restricted securities” and have not been registered under the
        Securities Act and is acquiring the number of Shares set forth in paragraph
        3 of
        the Securities Purchase Agreement and the Warrant in the ordinary course
        of its
        business and for its own account for investment only, has no present intention
        of distributing any of such Shares or Warrants and has no arrangement or
        understanding with any other persons regarding the distribution of such Shares
        or Warrants (this representation and warranty not limiting the Investor’s right
        to sell Shares pursuant to a Registration Statement filed under the Registration
        Rights Agreement or otherwise, or other than with respect to any claim arising
        out of a breach of this representation and warranty, the Investor’s right to
        indemnification under Section 3 of the Registration Rights Agreement); (iii)
        the
        Investor will not, directly or indirectly, offer, sell, pledge, transfer
        or
        otherwise dispose of (or solicit any offers to buy, purchase or otherwise
        acquire or take a pledge of) any of the Shares or Warrants except in compliance
        with the Securities Act, applicable state securities laws and the respective
        rules and regulations promulgated thereunder; (iv) the Investor has answered
        all
        questions in paragraph 4 of the Securities Purchase Agreement and the Investor
        Questionnaire attached hereto as Exhibit
        C
        for use
        in preparation of the Registration Statement and for determining the
        availability of state “Blue Sky” exemptions and the answers thereto are true and
        correct as of the date hereof and will be true and correct as of the Closing
        Date; (v) the Investor will notify the Company promptly of any change in
        any of
        such information until such time as the Investor has sold all of its Shares
        or
        until the Company is no longer required to keep the Registration Statement
        effective; and (vi) the Investor has, in connection with its decision to
        purchase the number of Shares set forth in paragraph 3 of the Securities
        Purchase Agreement, relied upon the representations and warranties of the
        Company contained herein and the information contained in the SEC Reports.
        The
        Investor understands that the issuance of the Shares and Warrants to the
        Investor has not been registered under the Securities Act, or registered
        or
        qualified under any state securities law, in reliance on specific exemptions
        therefrom, which exemptions may depend upon, among other things, the
        representations made by the Investor in this Agreement. No person (including
        without limitation either Placement Agent) is authorized by the Company to
        provide any representation that is inconsistent with or in addition to those
        contained herein or in the SEC Reports, and the Investor acknowledges that
        it
        has not received or relied on any such representations.

       

      4.2  Transfer
        of Shares.
        The
        Investor agrees that it will not make any sale, transfer or other disposition
        of
        the Shares, the Warrants or the shares issuable upon exercise of the Warrants
        (a
“Disposition”)
        other
        than Dispositions that are made pursuant to the Registration Statement in
        compliance with any applicable prospectus delivery requirements or that are
        exempt from registration under the Securities Act. 

       

      4.3  Power
        and Authority.
        The
        Investor represents and warrants to the Company that (i) the Investor has
        full
        right, power, authority and capacity to enter into this Agreement and to
        consummate the transactions contemplated hereby and has taken all necessary
        action to authorize the execution, delivery and performance of this Agreement,
        and (ii) this Agreement constitutes a valid and binding obligation of the
        Investor enforceable against the Investor in accordance with its terms, except
        to the extent (i) rights to indemnity and contribution may be limited by
        state
        or federal securities laws or the public policy underlying such laws, (ii)
        such
        enforceability may be limited by applicable bankruptcy, insolvency,
        reorganization, moratorium or similar laws affecting creditors’ and contracting
        parties’ rights generally and (iii) such enforceability may be subject to
        general principles of equity (regardless of whether such enforceability is
        considered in a proceeding in equity or at law). 

       

      

      
        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

      

      

      

       

      4.4  Short
        Position.
        From the
        earlier of (i) thirty (30) days prior to the date hereof and (ii) the date
        the
        Investor learned of the Offering, neither the Investor nor any affiliate
        has
        directly or indirectly established or agreed to establish any
        hedge, “put equivalent position” (as defined in Rule 16a-1 under the Exchange
        Act) or other position
        in the Common Stock that is outstanding on the Closing Date and
        that
        is designed to or could reasonably be expected to lead to or result in a
        Disposition by the Investor or any other person or entity. For purposes hereof,
        a “hedge or other position” includes, without limitation, effecting any short
        sale or having in effect any short position (whether or not such sale or
        position is against the box and regardless of when such position was entered
        into) or any purchase, sale or grant of any right (including, without
        limitation, any put or call option) with respect to the Common Stock or with
        respect to any security (other than a broad-based market basket or index)
        that
        includes, relates to or derives any significant part of its value from the
        Common Stock.
        Each
        Investor acknowledges that this representation is made for the benefit of
        the
        Company and the other Investors, any of which may assert claims arising out
        of
        the breach of this Section 4.4.

       

      4.5  No
        Investment, Tax or Legal Advice.
        The
        Investor understands that nothing in the SEC Reports, this Agreement, or
        any
        other materials presented to the Investor in connection with the purchase
        and
        sale of the Shares or Warrants constitutes legal, tax or investment advice.
        The
        Investor has consulted such legal, tax and investment advisors as it, in
        its
        sole discretion, has deemed necessary or appropriate in connection with its
        purchase of Shares and Warrants. 

       

      4.6  Confidential
        Information.
        The
        Investor covenants that from the date hereof it will maintain in confidence
        all
        material non-public information regarding the Company received by the Investor
        from the Company, including the receipt and content of any Suspension Notice
        (as
        defined in the Registration Rights Agreement) until such information (a)
        becomes
        generally publicly available other than through a violation of this provision
        by
        the Investor or its agents or (b) is required to be disclosed in legal
        proceedings (such as by deposition, interrogatory, request for documents,
        subpoena, civil investigation demand, filing with any governmental authority
        or
        similar process); provided, however, that before making any disclosure in
        reliance on this Section 4.6, the Investor will give the Company at least
        fifteen (15) days prior written notice (or such shorter period as required
        by
        law) specifying the circumstances giving rise thereto and will furnish only
        that
        portion of the non-public information which is legally required and will
        exercise its commercially reasonable efforts to ensure that confidential
        treatment will be accorded any non-public information so furnished. The parties
        acknowledge and agree that as of the date hereof and as of the Closing Date,
        the
        Company has not disclosed any material non-public information to the
        Investor.

       

      4.7  Acknowledgments
        Regarding Placement Agents.
        The
        Investor acknowledges that the Placement Agents have acted solely as placement
        agents for the Company in connection with the Offering of the Shares and
        Warrants by the Company, and that the Placement Agents have made no
        representation or warranty whatsoever with respect to the accuracy or
        completeness of information, data or other related disclosure material that
        has
        been provided to the Investor. The Investor further acknowledges that in
        making
        its decision to enter into this Agreement and purchase the Shares and Warrants,
        it has relied on its own examination of the Company and the terms of, and
        consequences of holding, the Shares and the Warrants. The Investor further
        acknowledges that the provisions of this Section 4.7 are for the benefit
        of, and may be enforced by, each of the Placement Agents.

       

      

      
        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

        

      

      

      

       

      4.8  Additional
        Acknowledgement.
        The
        Investor acknowledges that it has independently evaluated the merits of the
        transactions contemplated by this Agreement, that it has independently
        determined to enter into the transactions contemplated hereby, that it is
        not
        relying on any advice from or evaluation by any Other Investor, and that
        it is
        not acting in concert with any Other Investor in making its purchase of the
        Shares and Warrants hereunder. The Investor and, to its knowledge, the Company
        acknowledge that the Investors have not taken any actions that would deem
        the
        Investors to be members of a “group” for purposes of Section 13(d) of the
        Exchange Act.

       

      5.  Transfer
        Restrictions.

       

      5.1  Legends.
        Certificates evidencing the Shares and the Warrant shall each bear any legend
        as
        required by the “blue sky” laws of any state and a restrictive legend in
        substantially the following form, until such time as they are not
        required:

       

      [NEITHER
        THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES
        HAVE BEEN REGISTERED] [THESE SECURITIES HAVE NOT BEEN REGISTERED] UNDER THE
        SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE
        SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
        OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT
        FOR
        THE SECURITIES UNDER THE SECURITIES ACT OR (B) AN AVAILABLE EXEMPTION FROM,
        OR
        IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
        ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS
        AS
        EVIDENCED BY A LEGAL OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY
        AND ITS TRANSFER AGENT OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID
        ACT.
        NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
        WITH
        A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
        BY THE
        SECURITIES. 

      

      
        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

      

      

      

       

      The
        Company acknowledges and agrees that an Investor may from time to time pledge,
        and/or grant a security interest in, some or all of the legended Shares in
        connection with applicable securities laws, pursuant to a bona fide margin
        agreement in compliance with a bona fide margin loan. Such a pledge would
        not be
        subject to approval or consent of the Company and no legal opinion of legal
        counsel to the pledgee, secured party or pledgor shall be required in connection
        with the pledge, but such legal opinion shall be required in connection with
        a
        subsequent transfer or foreclosure following default by the Investor transferee
        of the pledge. No notice shall be required of such pledge, but the Investor’s
        transferee shall promptly notify the Company of any such subsequent transfer
        or
        foreclosure. Each Investor acknowledges that the Company shall not be
        responsible for any pledges relating to, or the grant of any security interest
        in, any of the Shares or for any agreement, understanding or arrangement
        between
        any Investor and its pledgee or secured party. At the appropriate Investor’s
        expense, the Company will execute and deliver such reasonable documentation
        as a
        pledgee or secured party of Shares may reasonably request in connection with
        a
        pledge or transfer of the Shares, including the preparation and filing of
        any
        required prospectus supplement under Rule 424(b)(3) of the Securities Act
        or
        other applicable provision of the Securities Act to appropriately amend the
        list
        of selling stockholders thereunder. 

       

      5.2  Delivery
        of Certificates.
        Following effectiveness of a registration statement registering the Shares,
        if
        the Company shall fail for any reason or for no reason to issue to an Investor
        unlegended certificates within five (5) Business Days of receipt of all
        documents necessary for the removal of the legend set forth above (the
“Deadline
        Date”),
        then,
        in addition to all other remedies available to such Investor, if on or after
        the
        Business Day immediately following such five (5) Business Day period, such
        Investor purchases (in an open market transaction or otherwise) shares of
        Common
        Stock to deliver in satisfaction of a sale by the holder of shares of Common
        Stock that such Investor anticipated receiving from the Company without any
        restrictive legend (a “Buy-In”),
        then
        the Company shall, within three (3) Business Days after such Investor’s request
        and in such Investor’s sole discretion, either (i) pay cash to the Investor in
        an amount equal to such Investor’s total purchase price (including brokerage
        commissions, if any) for the shares of Common Stock so purchased (the
“Buy-In
        Price”),
        at
        which point the Company’s obligation to deliver such certificate (and to issue
        such shares of Common Stock) shall terminate, or (ii) promptly honor its
        obligation to deliver to such Investor a certificate or certificates
        representing such shares of Common Stock and pay cash to the Investor in
        an
        amount equal to the excess (if any) of the Buy-In Price over the product
        of (a)
        such number of shares of Common Stock, times (b) the Closing Bid Price on
        the
        Deadline Date. 

       

      6.  Survival
        of Representations, Warranties and Agreements. Notwithstanding
        any investigation made by any party to this Agreement or by the Placement
        Agent,
        all covenants, agreements, representations and warranties made by the Company
        and the Investor herein shall survive the execution of this Agreement, the
        delivery to the Investor of the Shares being purchased and the payment therefor,
        and a party’s reliance on such representations and warranties shall not be
        affected by any investigation made by such party or any information developed
        thereby. 

       

      7.  Registration
        of Shares; Public Statements. 

       

      7.1  In
        connection with the purchase and sale of the Shares by the Investors
        contemplated hereby, the Company has entered into a Registration Rights
        Agreement with each Investor providing for the filing by the Company of a
        Registration Statement on Form S-B-2 (or, if the Company is ineligible to
        use
        From SB-2, another appropriate form) to enable the resale of the Shares by
        the
        Investors from time to time.

       

      

      
        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

      

      

      

       

      7.2  The
        Company agrees to disclose on a Current Report on Form 8-K the existence
        of the
        Offering and the material terms, thereof, including pricing, within two (2)
        Business Days after the Closing. The Company will not issue any public
        statement, press release or any other public disclosure listing the Investor
        as
        one of the purchasers of the Shares without the Investor’s prior written
        consent, except as may be required by applicable law or rules of any exchange
        on
        which the Company’s securities are listed.

       

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

       

      (a)  if
        to the
        Company, to:

       

      PerfectEnergy
        International Limited

      7401
        Springbank Blvd., Suite 3

      Calgary,
        Alberta T3H 5R2

      Attention: [___________]

      Telephone: [___________]
        

      

      with
        a
        copy to: 

      

      [______________________]

      [______________________]

      [______________________]

      Attention:
        [_____________]

      Telephone: [____________]

      

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

       

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

       

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

       

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

       

      

      
        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

        

      

      

      

       

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

       

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

       

      

      

      
        
          
            
            

          

          
            12

            
              

            

          

          
            
            

            
              

            

          

        

      

      

      Exhibit
        A

       

      PERFECTENERGY
        INTERNATIONAL LIMITED

      

      STOCK
        CERTIFICATE QUESTIONNAIRE

       

      Pursuant
        to Section 4 of the Agreement, please provide us with the following
        information:

       

      

      
        	
                1. The
                  exact name in which your Shares and Warrants are to be registered
                  (this is
                  the name that will appear on your stock certificate(s) and Warrants).
                  You
                  may use a nominee name if appropriate:

              	 
	
                2. If
                  a nominee name is listed in response to item 1 above, the relationship
                  between the Investor and such nominee:

              	 
	
                3. The
                  mailing address of the registered holder listed in response to
                  item 1
                  above:

              	 
	
                4. The
                  Social Security Number or Tax Identification Number of the registered
                  holder listed in the response to item 1 above:

              	 

      

      

      

      
        
          
            
            

          

          
            A-1

            
              

            

          

          
            
            

            
              

            

          

        

      

      

      Exhibit
        b

       

      PERFECTENERGY
        INTERNATIONAL LIMITED

      

      FORM
        OF REGISTRATION RIGHTS AGREEMENT

       

      

       

      

       

      

      
        
          
            
            

          

          
            B-1

            
              

            

          

          
            
            

            
              

            

          

        

      

      

      Exhibit
        C

       

      PERFECTENERGY
        INTERNATIONAL LIMITED

      

       

      INVESTOR
        QUESTIONNAIRE

       

      (All
        information will be treated confidentially)

       

      To:
        PerfectEnergy International Limited, 

       

      The
        undersigned hereby acknowledges the following:

       

      This
        Investor Questionnaire (“Questionnaire”)
        must
        be completed by each potential investor in connection with the offer and
        sale of
        the shares of the Common Stock, par value $0.001 per share (the “Shares”)
        and
        Warrants, of Perfectenergy International Limited (the “Company”).
        The
        Shares are being offered and sold by the Company without registration under
        the
        Securities Act of 1933, as amended (the “Securities
        Act”),
        and
        the securities laws of certain states, in reliance on the exemptions contained
        in Section 4 of the Securities Act and on Regulation D promulgated thereunder
        and in reliance on similar exemptions under applicable state laws. The Company
        must determine that a potential investor meets certain suitability requirements
        before offering or selling Shares and Warrants to such investor. The purpose
        of
        this Questionnaire is to assure the Company that each investor will meet
        the
        applicable suitability requirements. The information supplied by the undersigned
        will be used in determining whether the undersigned meets such criteria,
        and
        reliance upon the private offering exemption from registration is based in
        part
        on the information herein supplied.

       

      This
        Questionnaire does not constitute an offer to sell or a solicitation of an
        offer
        to buy any security. The undersigned’s answers will be kept strictly
        confidential. However, by signing this Questionnaire the undersigned will
        be
        authorizing the Company to provide a completed copy of this Questionnaire
        to
        such parties as the Company deems appropriate in order to ensure that the
        offer
        and sale of the Shares and Warrants will not result in a violation of the
        Securities Act or the securities laws of any state and that the undersigned
        otherwise satisfies the suitability standards applicable to purchasers of
        the
        Shares. All potential investors must answer all applicable questions and
        complete, date and sign this Questionnaire. The undersigned shall print or
        type
        its responses and attach additional sheets of paper if necessary to complete
        its
        answers to any item.

       

      A. Background
        Information

       

      Name:__________________________________________________________________________________

       

      Business
        Address:________________________________________________________________________

                      (Number
        and
        Street)

      ____________________________________________________________________________

      (City)                     (State)                                              &
#160;                            
        (Zip
        Code)

       

      Telephone
        Number: (      )________________________

       

      
        Residence
          Address:________________________________________________________________________

                        (Number
          and
          Street)

        _______________________________________________________________________________________

        (City)                     (State)                                              
;                                                           
          (Zip
          Code)

         

        Telephone
          Number: (     
)________________________

      

       

      If
        an
        individual:

       

      Age:______           
        Citizenship:__________              
        Where
        registered to vote:____________________________

       

      If
        a
        corporation, partnership, limited liability company, trust or other
        entity:

       

      Type
        of
        entity:____________________________________________________________________________

       

      

      
        
          
            
            

          

          
            C-1

            
              

            

          

          
            
            

          

        

      

      

      

       

      State
        of
        formation:______________     Date
        of
        formation:_____________________

       

      Social
        Security or Taxpayer Identification
        No.__________________________________

       

      Send
        all
        correspondence to (check one):       ____
        Residence Address     ____
        Business Address

       

      B. Status
        as Accredited Investor

       

      The
        undersigned is an “accredited investor” as such term is defined in Regulation D
        under the Securities Act, because at the time of the sale of the Shares the
        undersigned falls within one or more of the following categories (Please
        initial
        one or more, as applicable):

       

      _____ (1) a
        bank as
        defined in Section 3(a)(2) of the Securities Act, or a savings and loan
        association or other institution as defined in Section 3(a)(5)(A) of the
        Securities Act whether acting in its individual or fiduciary capacity; a
        broker
        or dealer registered pursuant to Section 15 of the Securities Exchange Act
        of
        1934; an insurance company as defined in Section 2(13) of the Securities
        Act; an
        investment company registered under the Investment Company Act of 1940 or
        a
        business development company as defined in Section 2(a)(48) of that act;
        a Small
        Business Investment Company licensed by the U.S. Small Business Administration
        under Section 301(c) or (d) of the Small Business Investment Act of 1958;
        a plan
        established and maintained by a state, its political subdivisions, or any
        agency
        or instrumentality of a state or its political subdivisions for the benefit
        of
        its employees, if such plan has total assets in excess of $5,000,000; an
        employee benefit plan within the meaning of the Employee Retirement Income
        Security Act of 1974 if the investment decision is made by a plan fiduciary,
        as
        defined in Section 3(21) of such act, which is either a bank, savings and
        loan
        association, insurance company, or registered investment adviser, or if the
        employee benefit plan has total assets in excess of $5,000,000 or, if a
        self-directed plan, with the investment decisions made solely by persons
        that
        are accredited investors;1

       

      _____ (2) a
        private
        business development company as defined in Section 202(a)(22) of the Investment
        Advisers Act of 1940;

       

      _____ (3) an
        organization described in Section 501(c)(3) of the Internal Revenue Code
        of
        1986, corporation, Massachusetts or similar business trust, or partnership,
        not
        formed for the specific purpose of acquiring the Shares offered, with total
        assets in excess of $5,000,000;

       

      _____ (4) a
        natural
        person whose individual net worth, or joint net worth with that person’s spouse,
        at the time of such person’s purchase of the Shares exceeds
        $1,000,000;

       

      _____ (5) a
        natural
        person who had an individual income in excess of $200,000 in each of the
        two
        most recent years or joint income with that person’s spouse in excess of
        $300,000 in each of those years and has a reasonable expectation of reaching
        the
        same income level in the current year;

       

      _____ (6) a
        trust,
        with total assets in excess of $5,000,000, not formed for the specific purpose
        of acquiring the Shares offered, whose purchase is directed by a sophisticated
        person as described in Rule 506(b)(2)(ii) of Regulation D; and

       

      _____ (7) an
        entity
        in which all of the equity owners are accredited investors (as defined
        above).

       

    

     

    _______________

    1 
      As used in this Questionnaire, the term “net worth” means the excess of total
      assets over total liabilities. In computing net worth for the purpose of
      subsection (4), the principal residence of the investor must be valued at cost,
      including cost of improvements, or at recently appraised value by a professional
      appraiser. In determining income, the investor should add to the investor’s
      adjusted gross income any amounts attributable to tax exempt income received,
      losses claimed as a limited partner in any limited partnership, deductions
      claimed for depreciation, contributions to an IRA or KEOGH retirement plan,
      alimony payments, and any amount by which income from long-term capital gains
      has been reduced in arriving at adjusted gross income.

    
      

      
        
          
            
            

          

          
            C-2

            
              

            

          

          
            
            

          

        

      

       

      C. Representations

       

      The
        undersigned hereby represents and warrants to the Company as
        follows:

       

      1. Any
        purchase of the Shares and Warrants would be solely for the account of the
        undersigned and not for the account of any other person or with a view to
        any
        resale, fractionalization, division, or distribution thereof.

       

      2. The
        information contained herein is complete and accurate and may be relied upon
        by
        the Company, and the undersigned will notify the Company immediately of any
        material change in any of such information occurring prior to the closing,
        if
        any, with respect to the purchase of Shares by the undersigned or any
        co-purchaser.

       

      3. There
        are
        no suits, pending litigation, or claims against the undersigned that could
        materially affect the net worth of the undersigned as reported in this
        Questionnaire.

       

      4. The
        undersigned acknowledges that there may occasionally be times when the Company,
        based on the advice of its counsel, determines that it must suspend the use
        of
        the Prospectus forming a part of the Registration Statement (as such terms
        are
        defined in the Securities Purchase Agreement to which this Questionnaire
        is
        attached) until such time as an amendment to the Registration Statement has
        been
        filed by the Company and declared effective by the Securities and Exchange
        Commission or until the Company has amended or supplemented such Prospectus.
        The
        undersigned is aware that, in such event, the Shares will not be subject
        to
        ready liquidation, and that any Shares purchased by the undersigned would
        have
        to be held during such suspension. The overall commitment of the undersigned
        to
        investments which are not readily marketable is not excessive in view of
        the
        undersigned’s net worth and financial circumstances, and any purchase of the
        Shares will not cause such commitment to become excessive. The undersigned
        is
        able to bear the economic risk of an investment in the Shares.

       

      5. The
        undersigned has carefully considered the potential risks relating to the
        Company
        and a purchase of the Shares and Warrants and fully understands that the
        Shares
        and Warrants are speculative investments which involve a high degree of risk
        of
        loss of the undersigned’s entire investment. Among others, the undersigned has
        carefully considered each of the risks described in the Company’s Annual Report
        on Form 10-KSB for the year ended October 31, 2006 and in the Company’s
        Confidential Private Placement Memorandum dated [_______], 2007.

       

      6. The
        following is a list of all states and other jurisdictions in which blue sky
        or
        similar clearance will be required in connection with the undersigned’s purchase
        of the Shares and Warrants: 

       

      ___________________________________________

       

      ___________________________________________

       

      ___________________________________________

       

      The
        undersigned agrees to notify the Company in writing of any additional states
        or
        other jurisdictions in which blue sky or similar clearance will be required
        in
        connection with the undersigned’s purchase of the Shares.

       

      

      
        
          
            
            

          

          
            C-3

            
              

            

          

          
            
            

          

        

      

      

      IN
        WITNESS WHEREOF, the undersigned has executed this Questionnaire this _____
        day
        of __________, 2007, and declares under oath that it is truthful and
        correct.

       

       

      
        	 	 Print Name
	 	
                 

              	 
	 	 By:	 
	 	 Signature
	 	 	 
	 	 Title:	 
	 	 	
                (required for any purchaser that is a
                  corporation,

                partnership, trust or other entity)

              
	 	
                 

              

      

       

      
        
          
            
              
              

            

            
              C-4

              
                

              

            

            
              
              

            

          

Exhibit
          D

      

       

      FORM
        OF LEGAL OPINION

       

      _________,
        2007

       

      

      To: The
        Investors in Common Stock and Warrants of PerfectEnergy International Limited
        and the Placement Agents

      

      Ladies
        and Gentlemen:

       

      We
        have
        acted as counsel for Perfectenergy International Limited, a Nevada corporation
        (the “Company”), in connection with the issuance of  
        shares
        (the “Shares”) of the Company’s common stock, par value $0.001 per share, and
        warrants to purchase _______ shares (the “Warrant Shares”) of the Company’s
        common stock pursuant to those certain Securities Purchase Agreements, dated
        as
        of July [_], 2007, including the annex and exhibits thereto (collectively,
        the
“Agreement”), between the Company and the Investors named therein. This opinion
        is being delivered to you pursuant to Section 2 of Annex I of the Agreement.
        Capitalized terms used herein are as defined in the Agreement unless otherwise
        specifically provided herein.

       

      We
        have
        examined such documents and have reviewed such questions of law as we have
        considered necessary or appropriate for the purpose of this
        opinion.

       

      In
        rendering our opinion below, we have assumed the authenticity of all documents
        submitted to us as originals, the genuineness of all signatures, and the
        conformity to authentic originals of all documents submitted to us as copies.
        We
        have also assumed the legal capacity for all purposes relevant hereto of
        all
natural
        persons and, with respect to all parties
        to agreements
        and instruments
        relevant
        hereto other than the Company,
        that
        such parties had the requisite power and authority (corporate or otherwise)
        to
        execute, deliver and perform such agreement or instruments, that such agreements
        or instruments have been duly authorized by all requisite action (corporate
        or
        otherwise), executed and delivered by such parties and that such agreements
        or
        instruments are the valid, binding and enforceable obligations of such parties
        and that the issuance of the Warrant Shares will be in releinace upon an
        applicable exemption from the registration requirements of the Securities
        Act.
        As to
        questions of fact material to our opinion, we have relied, without independent
        verification, on the representations and warranties contained in the Agreement
        and on certificates of officers of the Company and public
        officials.

       

      In
        rendering such opinions, we have not conducted any independent investigation
        or
        consulted with other attorneys in our firm with respect to the matters covered
        by the Agreement. No inference as to our knowledge with respect to such matters
        should be drawn from the fact of our representation of the Company.

       

      Based
        on
        the foregoing, we are of the opinion that:

       

      1. The
        Company is a corporation incorporated, validly existing and in good standing
        under the laws of the State of Nevada, with the corporate power to conduct
        any
        lawful business activity. The Company has the corporate power to execute,
        deliver and perform the Agreement and the Warrants including, without
        limitation, the issuance and sale of the Shares and Warrants under the Agreement
        and to issue the Warrant Shares upon exercise of the Warrants.

       

      

      
        
          
            
            

          

          
            D-1

            
              

            

          

          
            
            

          

        

      

       

      2. Each
        of
        the Agreement, the Warrants and the Registration Rights Agreement has been
        duly
        authorized by all requisite corporate action, executed and delivered by the
        Company. Each of the Agreement, the Warrants and the Registration Rights
        Agreement constitutes the valid and binding agreement of the Company enforceable
        in accordance with its terms.

       

      3. The
        Shares and Warrants have been duly authorized and, upon issuance, delivery
        and
        payment therefor as described in the Agreement and the Warrants, will be
        validly
        issued, fully paid and nonassessable. The shares issuable upon exercise of
        the
        Warrants have been duly and validly reserved for issuance by all proper
        corporate action.

       

      4. The
        execution, delivery and performance of the Agreement, the Warrants and the
        Registration Rights Agreement and the issuance and sale of the Shares and
        Warrants in accordance with the Agreement, and the issuance and sale of the
        Warrant Shares upon exercise of the Warrants in accordance with the terms
        of the
        Warrants, does not: (a) violate or conflict with, or result in a breach of
        or
        default under, the Certificate of
        Incorporation or
        Bylaws
        of the Company, as amended, or (b) violate or conflict with, or constitute
        a
        default under any material agreement or instrument (limited, with your consent,
        to agreements filed with the Securities and Exchange Commission under the
        Exchange Act and applicable rules and regulations) to which the Company is
        a
        party.

       

      5. To
        our
        knowledge, no consent, approval, authorization or order of, and no notice
        to or
        filing with, any governmental agency or body or any court is required to
        be
        obtained or made by the Company for the issue and sale of the Shares and
        Warrants pursuant to the Agreement and the issuance of the Warrant Shares
        upon
        exercise of the Warrants in accordance with the terms of the Warrants, except
        such as have been obtained or made and such as may be required under the
        federal
        securities laws or the Blue Sky laws of the various states.

       

      6. Assuming
        the representations made by the Investors and the Company set forth in the
        Agreement and the exhibits thereto are true and correct and subject to the
        Placement Agents’ compliance with applicable securities laws and regulations
        (including, without limitation, the requirements of Regulation D under the
        Securities Act), the offer, sale, issuance and delivery of the Shares and
        the
        Warrants to the Investors, in the manner contemplated by the Agreement, is
        exempt from the registration requirements of the Securities Act, it being
        understood that no opinion is expressed as to any subsequent resale of such
        shares.

       

      The
        opinions set forth above are subject to the following qualifications and
        exceptions:

       

      (a) Our
        opinion in paragraph 1 above, with respect to the good standing of the
        Company, is based solely ona Certificate of Existence with Status in Good
        Standing dated _________, 2007 electronically received for the Secretary
        of
        State of Nevada.

       

      (b) Our
        opinion in paragraph 2 above is subject to the effect of any applicable
        bankruptcy, insolvency, reorganization, moratorium or other similar laws of
        general application affecting creditors’ rights. 

       

      (c) Our
        opinion in paragraph 2 above is subject to the effect of general principles
        of equity, including (without limitation) concepts of materiality,
        reasonableness, good faith and fair dealing, and other similar doctrines
        affecting the enforceability of agreements generally (regardless of whether
        considered in a proceeding in equity or at law).

       

      

      
        
          
            
            

          

          
            D-2

            
              

            

          

          
            
            

          

        

      

       

      (d) Our
        opinion in paragraph 2 above, insofar as it relates to indemnification
        provisions, is subject to the effect of federal and state securities laws
        and
        public policy relating thereto.

       

      (e) We
        express no opinion as to the compliance or the effect of noncompliance by
        the
        Investors with any state or federal laws or regulations applicable to the
        Investors in connection with the transactions described in the Agreement
        or the
        payment obligations of the Company under Sections 1(b) and 2(d) of the
        Registration Rights Agreement if the payment obligations are construed as
        unreasonable in relation to actual damages or disproportionate to actual
        damages
        suffered by the Investor.

       

      Our
        opinions
        expressed above are limited to the laws of the State of Nevada and the federal
        laws of the United States of America.

       

      The
        foregoing opinions are being furnished to you solely for your benefit and
        may
        not be relied upon by any other person without our prior written consent.
        Notwithstanding
        the foregoing, Canaccord
        Adams and Knight Capital Markets LLC may
        rely
        on the opinions herein expressed as if
        this
letter were
        addressed to it.

       

       

      
        	 	Very
                truly yours,

      

      

      

       

      

      
        
          
          

        

        D-3

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