UNSECURED PROMISSORY NOTE

FOR VALUE RECEIVED, the undersigned, The Saint James Company, a North Carolina corporation (the “ Company ”), HEREBY PROMISES TO PAY, to the order of Pinnacle Resources, Inc., a Wyoming corporation (the “ Payee ”), the principal sum of Twenty-Five Thousand and 00/100 Dollars ($25,000.00) (the “ Principal Amount ”), in lawful money of the United States of America, together with interest, on the dates and in the manner provided below.

Section 1.1             Principal Payback .  The Principal Amount of this Unsecured Promissory Note (the “ Note ”) shall be repaid on demand of the Payee (the “ Principal Payment Date ”).  No payments shall be required hereunder prior to the Principal Payment Date.

Section 1.2             Interest .  Interest shall be simple interest and shall accrue on the outstanding Principal Amount of this Note during the period commencing on the date hereof and continuing until this Note is paid in full at a rate equal to ten percent (10%) per annum on the basis of a 360-day year and actual days elapsed   (the “ Interest Rate ”).  The Company shall pay the accrued interest hereunder on the Principal Payment Date.

Section 1.3            Interest Rate Limitation .  Notwithstanding anything herein to the contrary, if at any time the Interest Rate shall exceed the maximum lawful rate (the “ Maximum Rate ”), which may be contracted for, charged, taken, or received by the Payee in accordance with applicable law, the rate of interest payable in respect of this Note shall be limited to the Maximum Rate.

Section 1.4             Prepayment .  The Company may, without premium or penalty, prepay all or any portion of the outstanding principal amount due under this Note, provided that each such prepayment is accompanied by accrued but unpaid interest on the amount of principal prepaid calculated to the date of such payment.

Section 1.5             Default Rate .  If the Company fails to pay any amount under this Note when due, all amounts of principal and accrued interest outstanding shall bear simple interest from the date they were so due until paid in full at a per-annum rate equal to the lesser of (i) 18.0% or (ii) the Maximum Rate.

Section 2.1             Events of Default .  The Company shall be in default if any of the following events (“ Event of Default ”) shall occur and be continuing:

(a)           the failure of the Company to pay any principal amount of, or interest on, this Note when due and payable under Section 1.1 or 1.2 hereof;

(b)           the Company shall (i) commence any case, proceeding, or other action        (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, dissolution, reorganization, or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it as bankrupt or insolvent, or seeking reorganization, dissolution, arrangement, adjustments, winding-up, or liquidation with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian or other similar official for it or for all or any substantial part of its assets; (ii) make a general assignment for the benefit of its creditors; r (iii) sell all or substantially all of its assets in one or more transactions; or

(c)           there shall be commenced against the Company any case, proceeding or other action of a nature referred to in clause (b) above that results in the entry of an order for relief or any such adjudication or appointment that remains undismissed, undischarged, unbonded, or unstayed for a period of ninety (90) days.

Section 2.2            Remedies .  Upon the occurrence of an Event of Default, Payee shall be entitled to the following rights and remedies:

(a)           The whole sum of principal and accrued interest outstanding shall become immediately due and payable within ten (10) business days after the Company’s receipt of written notice thereof from Payee; and

(b)           Payee may exercise any and all other remedies it may have at law or in equity.

Section 3.1             Transfer by Payee; Obligations of Payee .  The Payee covenants and agrees that the Payee shall not transfer this Note or any part of Payee’s right, title and interest in or to this Note to any third party without the consent of the Company; provided , however , this Note will inure to