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Exhibit 10.2
 
EXECUTION VERSION

 
INVESTOR RIGHTS AGREEMENT
 
INVESTOR RIGHTS AGREEMENT dated as of September 20, 2010 (“Agreement”) between
Altair Nanotechnologies, Inc., a company organized under the laws of Canada (the
“Company”), and Canon Investment Holdings Limited, a company organized under the
laws of Hong Kong (the “Investor”).
 
WHEREAS, the Company desires to issue and sell certain shares of Common Stock
(as defined below) to Investor, and Investor desires to subscribe for such
shares of Common Stock, pursuant to that certain Share Subscription Agreement
dated of even date herewith (the “Share Subscription Agreement”);

WHEREAS, as an inducement to Investor entering into the Share Subscription
Agreement and incurring the obligations thereunder, it is the intention of the
parties that Investor shall have the right and the Company shall make the
necessary arrangements to ensure that Investor has the ability to maintain its
Ownership Percentage (as defined below); and

WHEREAS, the parties also desire to establish in this Agreement certain terms
and conditions concerning the governance of the Company, the registration of
securities of the Company, and the acquisition of securities of the Company by
Investor.

NOW, THEREFORE, in consideration of the foregoing and the mutual promises and
agreements contained herein, Investor and the Company hereby agree as follows:
 
ARTICLE 1
Definitions
 
Section 1.01.  Definitions.
 
“1933 Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
 
“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.
 
“Adverse Disclosure” means public disclosure of material non-public information,
which disclosure in the good faith judgment of a majority of the Board after
consultation with counsel to the Company would have a material adverse effect on
the ability of the Company to consummate a material acquisition, disposition or
other comparable extraordinary transaction.
 
 
 
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“Affiliate” has the meaning set forth in the Share Subscription Agreement.
 
“Al Yousuf Rights Agreement” shall mean the Registration Rights Agreement dated
November 29, 2007 between Al Yousuf, LLC and the Company, as amended by
Amendment No. 1 dated September 30, 2008 and Amendment No. 2 dated August 14,
2009.
 
“Board” means the board of directors of the Company.
 
“Business Day” has the meaning set forth in the Share Subscription Agreement.
 
“Closing” has the meaning set forth in the Share Subscription Agreement.
 
“Company Securities” has the meaning set forth in the Share Subscription
Agreement.
 
“Common Stock” means the common stock, without par value, of the Company, and
any securities issued in respect thereof, or in substitution therefor, in
connection with any stock split, dividend or combination, or any
reclassification, recapitalization, merger, consolidation, exchange or other
similar reorganization.
 
“Current Percentage” means, with respect to any Person as of any determination
date, (i) the aggregate number of shares of Common Stock beneficially held by
such Person and its Affiliates on a Fully-Diluted Basis divided by (ii) the
aggregate number of shares of Common Stock outstanding as of such determination
date on a Fully-Diluted Basis.
 
“Form S-1” means a registration statement on Form S-1 under the 1933 Act, or any
successor form thereto.
 
“Form S-3” means a registration statement on Form S-3 (other than on Form
S-3ASR) under the 1933 Act, or any successor form thereto.
 
“Form S-3ASR” means an “automatic shelf” registration statement on Form S-3
filed by a Well-Known Seasoned Issuer.
 
“Form S-4” means a registration statement on Form S-4 under the 1933 Act, or any
successor form thereto.
 
“Form S-8” means a registration statement on Form S-8 under the 1933 Act, or any
successor form thereto.
 
“Holder” means Investor and any of its transferees, assignees and successors
that beneficially owns any Registrable Securities.
 
 
 
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“Fully-Diluted Basis” has the meaning set forth in the Share Subscription
Agreement.
 
“incur” means, directly or indirectly, to incur, refinance, create, assume,
guarantee or otherwise become liable.
 
“Issuer Free Writing Prospectus” shall have the meaning set forth in Rule 433
under the 1933 Act.
 
“Market Price” of any shares of Common Stock, on any date means (i) the average
of the last sale price of such shares on each of the five trading days
immediately preceding such date on the NASDAQ Capital Market or, if such shares
are not listed thereon, on the principal national securities exchange or
automated interdealer quotation system on which such shares are traded or (ii)
if such sale prices are unavailable or such shares are not so traded, the value
of such shares on such date determined in accordance with agreed-upon procedures
reasonably satisfactory to Investor and the Company.
 
“NASD” means the National Association of Securities Dealers.
 
“NASDAQ” means The Nasdaq Stock Market, or any successor thereto.
 
“New Securities” means equity securities of the Company, or rights, options, or
warrants to purchase said equity securities, or securities of any type
whatsoever that are, or may become, convertible into or exchangeable into or
exercisable for said equity securities; provided, however, New Securities shall
not include: (a) any equity securities, rights, options, warrants or securities
exchangeable into or exercisable for equity securities outstanding on the
Closing Date and securities issued upon the exercise or conversion of such
securities, or (b) securities issuable upon a stock split, stock dividend, or
any subdivision of the Common Stock.
 
“Ownership Percentage” means Investor’s Current Percentage immediately after the
subscription of shares of Common Stock pursuant to the Share Subscription
Agreement.
 
“Person” has the meaning set forth in the Share Subscription Agreement.
 
“Prospectus” means the prospectus included in any Registration Statement,
including any preliminary prospectus, any final prospectus and any such
prospectus as amended or supplemented by any prospectus supplement, including
any such prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Registration Statement, and
by all other amendments and supplements to a prospectus, including
post-effective amendments, and in each case including all materials incorporated
by reference therein.
 
 
 
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“Purchased Securities” has the meaning set forth in the Share Subscription
Agreement.
 
“Registrable Securities” means (i)  the Purchased Securities (which may be held
by one or more, or any Holder(s)), and (ii) any capital stock or other
securities which may be issued, converted, exchanged or distributed in respect
thereof, or in substitution therefor, in connection with any stock split,
dividend or combination, or any recapitalization, reclassification, merger,
consolidation, exchange or other similar reorganization with respect to the
Purchased Securities deemed Registrable Securities hereunder.  As to any
particular Registrable Securities, once issued, such Registrable Securities
shall cease to be Registrable Securities when (A) a Registration Statement with
respect to the sale by the Holder of such securities shall have become effective
under the 1933 Act and such securities shall have been disposed of in accordance
with such registration statement, (B) such securities shall have been
distributed to the public pursuant to Rule 144, (C) such securities shall have
become eligible for sale by the Holder thereof pursuant to the last sentence of
Rule 144(b)(1)(i), or (D) such securities shall have ceased to be
outstanding.  For purposes of this Agreement, any required calculation of the
amount of, or percentage of, Registrable Securities shall be based on the number
of shares of Common Stock which are Registrable Securities, including shares
issuable upon the conversion, exchange or exercise of any security convertible,
exchangeable or exercisable into Common Stock.
 
“Registration Expenses” means any and all expenses incident to performance of or
compliance with Article 3, including (i) all SEC and securities exchange or NASD
registration and filing fees, (ii) all fees and expenses of complying with
securities or blue sky laws, (iii) all printing, messenger and delivery
expenses, (iv) all fees and expenses incurred in connection with the listing of
the Registrable Securities on any securities exchange, (v) the fees and
disbursements of counsel for the Company and of its independent public
accountants, including the expenses of any special audits and/or “cold comfort”
letters required by or incident to such performance and compliance, (vi) the
reasonable fees and disbursements of counsel selected pursuant to Section 3.10,
(vii) any fees and disbursements of underwriters customarily paid by the
issuers, including liability insurance if the Company so desires, and (viii) the
reasonable expenses incurred by the Company in connection with any “road show”
undertaken pursuant to Section 3.06.
 
“Registration Statement” means the registration statements required to be filed
hereunder, including (in each case) the Prospectus, amendments and supplements
to such registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.
 
“Rule 144” means Rule 144 under the 1933 Act (or any successor rule).
 
“Rule 415” means Rule 415 under the 1933 Act (or any successor rule).
 
 
 
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“Rule 424” means Rule 424 under the 1933 Act (or any successor rule).
 
“SEC” means the U.S. Securities and Exchange Commission or any successor
thereto.
 
“Subsidiary Securities” has the meaning set forth in the Share Subscription
Agreement.
 
“Well-Known Seasoned Issuer” has the meaning set forth in Rule 405 under the
1933 Act.
 
Section 1.02.  Other Definitional and Interpretative Provisions.  The words
“hereof”, “herein” and “hereunder” and words of like import used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement.  The captions herein are included for convenience
of reference only and shall be ignored in the construction or interpretation
hereof.  References to Articles, Sections, Exhibits and Schedules are to
Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise
specified.  All Exhibits and Schedules annexed hereto or referred to herein are
hereby incorporated in and made a part of this Agreement as if set forth in full
herein.  Any capitalized terms used in any Exhibit or Schedule but not otherwise
defined therein, shall have the meaning as defined in this Agreement.  Any
singular term in this Agreement shall be deemed to include the plural, and any
plural term the singular.  Whenever the words “include”, “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation”, whether or not they are in fact followed by
those words or words of like import.  “Writing”, “written” and comparable terms
refer to printing, typing and other means of reproducing words (including
electronic media) in a visible form.  References to any agreement or contract
are to that agreement or contract as amended, modified or supplemented from time
to time in accordance with the terms hereof and thereof; provided that with
respect to any agreement or contract listed on any schedules hereto, all such
amendments, modifications or supplements must also be listed in the appropriate
schedule.  References to any Person include the successors and permitted assigns
of that Person.  References from or through any date mean, unless otherwise
specified, from and including or through and including,
respectively.  References to “law”, “laws” or to a particular statute or law
shall be deemed also to include any and all rules and regulations promulgated
thereunder.  References to “$” and “dollars” are to the currency of the United
States.
 
 
ARTICLE 2
Corporate Governance
 
Section 2.01. Investor’s Right to Proportional Representation.  (a)  Upon the
request of the Investor at any time by written notice to the Company (a
“Governance Notice”), Investor shall be immediately entitled to designate a
Proportionate Number of directors on the Board as set forth in this Article 2
(except to the extent such actions, upon advice of counsel, would be a breach
of, contrary to or otherwise in conflict with any Applicable Law, including any
stock exchange listing requirements, or fiduciary duty imposed thereby).  The
term “Proportionate Number”  shall mean a number of directors equal to
Investor’s then Current Percentage multiplied by the total number of directors
on the Board, rounded up to the next whole number.  For the avoidance of doubt,
it is acknowledged by the parties that effective as of the Closing, Investor
shall be entitled to designate a majority of the members of the Board.
 
 
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(b) The Company shall take all such action as is necessary or advisable and
within its control (except to the extent such actions, upon advice of counsel,
would be a breach of, contrary to or otherwise in conflict with any Applicable
Law, including any stock exchange listing requirements, or fiduciary duty
imposed thereby), including without limitation calling special Board and
stockholder meetings, so that:
 
(i) during the period Investor’s Current Percentage is at least 7.5% (the
“Designation Period”), subject to any requirements of this Section 2.01, a
number of individuals equal to the Proportionate Number designated by the
Investor shall be appointed or elected to the Board (with any director
designated by Investor and appointed or elected to the Board being a “Designated
Director”);
 
(ii) during the Designation Period, the removal from the Board (with or without
cause) of any Designated Director shall be at the written request of the
Investor but only upon such written request and under no other circumstances;
and
 
(iii) in the event that a Designated Director ceases to serve as a member of the
Board during his term of office (whether by death, resignation or removal)
during the Designation Period, the resulting vacancy on the Board shall be
filled by an individual designated by the Investor.
 
(c) During the Designation Period, absent new designations or contrary
instructions from the Investor, an individual previously designated to serve as
a Designated Director shall be deemed designated by the Investor to continue to
serve as a Designated Director until further notice from the Investor.
 
(d) For so long as the Investor’s Current Ownership exceeds 40%, in exercising
its rights to designate directors under this Article 2, the Investor shall
cooperate with the Company such that the composition of the Board will satisfy
Applicable Law, including stock exchange listing requirements and applicable
statutory residency or citizenship requirements for directors.
 
 
 
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ARTICLE 3
Registration Rights
 
Section 3.01.  Shelf Registration Statement.  (a) From and after the second
anniversary of Closing, the Company shall:
 
(i) as promptly as practicable, but in any event not later than 30 days upon
receipt of written notice from a Holder or Holders holding at least 50% of the
Registrable Securities (collectively, the “Majority Holder”) (the date, the
“Filing Date”), prepare and file with the SEC a “Shelf” Registration Statement
(the “Shelf Registration Statement”) covering the resale of the Registrable
Securities by the Holders thereof from time to time in accordance with the
methods of distribution elected by such Holders, to be made on a continuous
basis pursuant to Rule 415.  The Shelf Registration Statement shall be on Form
S-3 (except if the Company is not then eligible to register for resale the
Registrable Securities on Form S−3, in which case such registration shall be on
another appropriate form in accordance herewith, reasonably acceptable to
Holders of a majority of the Registrable Securities), as modified by the Company
as necessary to conform to comments from the SEC;
 
(ii) use its reasonable best efforts to cause the Shelf Registration Statement
to be declared effective under the 1933 Act as promptly as possible after the
filing thereof, but in any event prior to the 90th day (or the 120th day in the
case of a “full review” by the SEC) after the date of the request (the
“Effectiveness Date”);
 
(iii) within two Business Days after the Shelf Registration Statement is
declared effective, file a final Prospectus with the SEC pursuant to Rule 424
and notify the Holders via facsimile of effectiveness of the Shelf Registration
Statement;
 
(iv) use its reasonable best efforts to keep the Shelf Registration Statement
continuously effective under the 1933 Act until such time as all Registrable
Securities covered by such Registration Statement have been sold or cease to be
Registrable Securities (the “Effectiveness Period”);
 
(v) during the Effectiveness Period, furnish to each Holder with respect to the
Registrable Securities registered under the Shelf Registration Statement (and to
each underwriter, if any, of such Registrable Securities) such number of copies
of Prospectuses and such other documents as such Holder may reasonably request,
in order to facilitate the public sale or other disposition of all or any of the
Registrable Securities by such Holder;
 
 
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(vi) during the Effectiveness Period, notify each holder of Registrable
Securities covered by such Registration Statement at any time when a Prospectus
relating thereto is required to be delivered under the 1933 Act of the happening
of any event as a result of which the prospectus included in such Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing; and
 
(vii) file documents required of the Company for normal Blue Sky clearance in
states specified in writing by any Holder; provided that the Company shall not
be required to qualify to do business or consent to service of process in any
jurisdiction in which it is not now so qualified or has not so consented.
 
(b) From the date hereof until the earlier of the  date the Shelf Registration
Statement is declared effective under the 1933 Act or the date the Investor no
longer holds any Registrable Securities, subject to the rights of Al Yousuf, LLC
under the Al Yousuf Rights Agreement, unless agreed to by the Majority Holder,
the Company shall not file, nor permit the filing of, any Registration Statement
other than the Shelf Registration Statement.
 
Section 3.02.  Demand Registration. (a) From and after the second anniversary of
the date hereof, if, at any time there is no currently effective Shelf
Registration Statement, upon written notice (a “Demand”) from a Majority Holder
requesting that the Company effect the registration under the 1933 Act of any or
all of the Registrable Securities held by the Majority Holder, which notice
shall specify the amount and intended method or methods of disposition of such
Registrable Securities, including pursuant to a shelf registration statement
utilizing Rule 415 (a “Shelf Registration”), the Company shall, within five days
after receiving the Demand, give written notice (the “Request Notice”) of such
registration request to all other Holders, except if all the Registrable
Securities are held by a single Holder, no Request Notice shall be required, and
thereupon will, subject to the limitations set forth in Section 3.02(c), as
promptly as possible (and in any event no later than 30 days after the date of
the Demand), file and use its reasonable best efforts to cause to be declared
effective under the 1933 Act, a Registration Statement to effect the
registration under the 1933 Act of (i) such Registrable Securities which the
Company has been so requested to register by the Majority Holder under the
Demand and (ii) the Registrable Securities which the Company has been requested
to register by written request to the Company by the Holders within ten days
after the giving of the Request Notice (which request shall specify the amount
and intended method or methods of disposition of such Registrable Securities),
all to the extent necessary to permit the disposition (in accordance with the
intended method(s) thereof as aforesaid) of the Registrable Securities and such
other securities so to be registered.
 
(b) A registration requested pursuant to this Section 3.02 will not be deemed to
have been effected unless it has been declared effective by the SEC or has
otherwise become effective under the 1933 Act and remains effective for not less
than 180 days, or, if such Registration Statement relates to an underwritten
offering, such longer period as, in the opinion of counsel for the underwriter
or underwriters is required by law for the delivery of a Prospectus in
connection with the sale of Registrable Securities by an underwriter or dealer.
 
 
 
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(c) Notwithstanding anything in this Agreement to the contrary:
 
(i) if the filing of a Registration Statement in respect of a Demand would
require the Company to make an Adverse Disclosure, the Company may, upon giving
prompt written notice of such action to the Holders, delay the filing of such
Registration Statement for the shortest period of time determined in good faith
by the Company to be necessary for such purpose; provided that the Company shall
not be permitted to do so (A) more than one time during any twelve month period
or (B) for a period not exceeding 30 days on any one occasion.  The Company
shall immediately notify the Holders of the expiration of any period during
which it exercised its rights under this Section 3.02(c)(i);
 
(ii) the Company shall not be obligated to file a Registration Statement in
respect of a Demand (A) on more than four (4) occasions or (B) within a period
of six (6) months after the effective date of any other Registration Statement
of the Company demanded pursuant to this Section 3.02;
 
(iii) a Holder may elect to withdraw its Registrable Securities from a Demand
registration pursuant to this Section 3.02 at any time, and if all such Holders
do so, the Company shall cease its efforts to secure registration; and
 
(iv) all Demand registrations pursuant to this Section 3.02 shall be on Form
S-3, except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form, reasonably acceptable to the Holders of a majority of
the Registrable Securities, and as shall permit the disposition of the
Registrable Securities in accordance with the intended method of distribution or
methods of distribution specified in the applicable Majority Holder’s requests
for such registration.
 
Section 3.03.  Shelf Take-Downs.  Any of the Holders whose Registrable
Securities have been registered pursuant to a Shelf Registration may initiate an
offering or sale of Registrable Securities pursuant to such Shelf Registration
(each, a “Shelf Take-Down”) and such Holder shall not be required to permit the
offer and sale of Registrable Securities by other Holders in connection with
such Shelf Take-Down.  If the initiating Holders so elect by written request to
the Company, a Shelf Take-Down may be in the form of an underwritten offering
(an “Underwritten Shelf Take-Down”); provided that any underwritten sale
pursuant to a Shelf Registration pursuant to this Section 3.03 must be for a
number of Registrable Securities which, based on the good faith determination of
the Holders, will result in gross proceeds of at least $5 million in the case of
any underwritten offering.  The Company shall, if so requested, file and effect
an amendment or supplement of the Shelf Registration for such purpose as soon as
practicable.
 
 
 
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Section 3.04.  Selection Of Underwriters.  If a Shelf Take-Down involves an
underwritten offering, the investment bankers, underwriters and managers for
such registration shall be selected by the Holders of a majority in interest of
the Registrable Securities which the Company has been requested to register and
approved by the Company, such approval not to be unreasonably withheld or
delayed.
 
Section 3.05.  Piggyback Registration.  (a) If the Company proposes to register
Company Securities under the 1933 Act (other than (x) a registration under
Section 3.01, 3.02 or 3.03, (y) a registration on Form S−4 or S−8 or any
successor form to such forms), involving the offering of such Company Securities
at any time, whether or not for sale for its own account, in a manner which
would permit registration of Registrable Securities of the same class of such
Company Securities for sale to the public under the 1933 Act, it will, at each
such time, give prompt written or telephonic notice (a “Piggyback Offering
Notice”) to the Holders of: its intention to do so, the form on which the
Company expects to effect such registration (e.g. Form S-1, Form S-3, Form
S-3ASR), the anticipated filing date with the SEC of such registration
statement, the anticipated date that the registration statement will be declared
or otherwise become effective, whether the offering is to be underwritten, in
the case of Form S-3 or Form S-3ASR, the anticipated date and time that the
offering will be made, and (unless all of the Holders’ Registrable Securities
are then registered pursuant to Section 3.02 or 3.03 or a Shelf Registration
Statement under Section 3.01 is in effect) such notice shall offer the Holders
the opportunity to register such number of Registrable Securities as each such
Holder may request in writing (a “Piggyback Registration”).  The registration
rights provided for in this Section 3.05 are in addition to, and not in lieu of,
registrations made pursuant to Section 3.01, 3.02 or 3.03.
 
(b) Subject to Section 3.05(c), the Company shall include in such Registration
Statement all such Registrable Securities which are requested to be included
therein within 10 days after the receipt by such Holder of any such notice.  If
at any time after giving written notice of its intention to register any
securities and prior to the effective date of the Registration Statement filed
in connection with such registration, the Company shall determine for any reason
not to register or to delay registration of such securities, the Company may, at
its election, give written notice of such determination to each Holder of
Registrable Securities and, (x) in the case of a determination not to register,
shall be relieved of its obligation to register any Registrable Securities in
connection with such registration, and (y) in the case of a determination to
delay registering, shall be permitted to delay registering any Registrable
Securities for the same period as the delay in registering such other
securities.  If the offering pursuant to a Piggyback Registration is to be an
underwritten offering, then each Holder making a request for its Registrable
Securities to be included therein must, and the Company shall make such
arrangements with the underwriters so that each such Holder may, participate in
such underwritten offering on the same terms as the Company and other Persons
selling securities in such underwritten offering. If the offering pursuant to
such registration is to be on any other basis, then each Holder making a request
for a Piggyback Registration pursuant to this Section 3.05 must participate in
such offering on such basis.  Each Holder shall be permitted to withdraw all or
part of such Holder’s Registrable Securities from a Piggyback Registration at
any time prior to effectiveness of the Registration Statement.
 
 
 
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(c) If the managing underwriter or underwriters of any proposed underwritten
offering of a class of securities included in a Piggyback Registration (or in
the case of a Piggyback Registration not being underwritten, the Company)
informs the Holders of Registrable Securities sought to be included in such
registration in writing that, in its or their opinion, the total amount or kind
of securities which such Holders and any other Persons intend to include in such
offering exceeds the number which can be sold in such offering without being
likely to have a significant adverse effect on the price, timing or distribution
of the class or classes of the securities offered or the market for the class or
classes of securities offered, then the securities of each class to be included
in such registration shall be allocated as follows:
 
(i) first, 100% of the securities that the Company proposes to sell;
 
(ii) second, and only if all the securities referenced in clause (i) have been
included, the number of Registrable Securities of such class that, in the
opinion of such underwriter or underwriters (or in the case of a Piggyback
Registration not being underwritten, the Company), can be sold without having
such adverse effect shall be included therein, with such number to be allocated
pro rata among the Holders which have requested participation in the Piggyback
Registration (based, for each such Holder, on the percentage derived by dividing
(x) the number of Registrable Securities of such class which such Holder has
requested to include in such Incidental Registration by (y) the aggregate number
of Registrable Securities of such class which all such Holders have requested to
include); and
 
(iii) third, and only if all of the Registrable Securities referenced in clauses
(i) and (ii) above have been included, any other securities eligible for
inclusion in such registration shall be included therein.
 
Section 3.06. Registration Procedures.  If and whenever the Company is required
to effect a registration of any Registrable Securities as provided in this
Agreement, the Company will:
 
 
 
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(a) promptly prepare and file with the SEC a registration statement with respect
to such Registrable Securities and use best efforts to cause a registration
statement with respect to a demand registration pursuant to Section 3.02 to be
filed (in the case of a registration pursuant to Form S-3ASR), or become
effective (in the case of any registration other than pursuant to Form S-3ASR)
as promptly as practicable;
 
(b) prepare and file with the SEC such amendments and supplements to such
registration statement (including 1934 Act documents incorporated by reference
into the registration statement) and the Prospectus used in connection therewith
as may be necessary to keep such registration statement effective for a period
not less than 180 days (or such longer period as may be requested by the Holders
in the event of a shelf registration statement) other than the Shelf
Registration Statement which shall remain effective for the Effectiveness Period
and to comply with the provisions of the 1933 Act and the 1934 Act with respect
to the disposition of all securities covered by such registration statement
during such period in accordance with the intended methods of disposition by the
seller or sellers thereof set forth in such registration statement; provided
that before filing a registration statement or Prospectus or any amendments or
supplements thereto in accordance with Section 3.06(a) or this Section 3.06(b)
to the extent that doing so will not materially interfere with the timing of the
offering (i) the Company will furnish to counsel selected pursuant to Section
3.10 copies of all documents proposed to be filed and (ii) such documents will
be subject to the review of such counsel reasonably in advance of any filing to
permit a reasonable opportunity to review and comment in light of the
circumstances;
 
(c) use reasonable best efforts to comply with all applicable securities laws in
the United States and register or qualify such Registrable Securities covered by
such registration in such jurisdictions in the United States as each seller
shall reasonably request, and do any and all other acts and things which may be
reasonably necessary to enable such seller to consummate the disposition in such
jurisdictions of the Registrable Securities owned by such seller, except that
the Company shall not for any such purpose be required to qualify generally to
do business as a foreign corporation in any jurisdiction where, but for the
requirements of this Section 3.06(c), it would not be obligated to, subject
itself to taxation in any such jurisdiction or to consent to general service of
process in any such jurisdiction;
 
(d) promptly furnish to each seller of such Registrable Securities such number
of copies of such registration statement and of each amendment and supplement
thereto (in each case including all exhibits filed therewith, including any
documents incorporated by reference), such number of copies of the Prospectus
included in such registration statement (including each preliminary prospectus
and summary prospectus), in conformity with the requirements of the 1933 Act,
and such other similar documents as such seller may reasonably request necessary
to facilitate the disposition of the Registrable Securities by such seller;
 
 
 
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(e) notify each seller of any such Registrable Securities covered by such
registration statement promptly if the Company becomes aware that the Prospectus
included in such registration statement, as then in effect, or the registration
statement includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing and,
prepare and furnish to such seller a reasonable number of copies of an amended
or supplemental prospectus as may be necessary so that, as thereafter delivered
to the purchasers of such Registrable Securities, such Prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing;
 
(f) otherwise use reasonable best efforts to comply with all applicable rules
and regulations of the SEC, and make available to its security holders, as soon
as reasonably practicable (but not more than 18 months) after the effective date
of the registration statement, an earnings statement which shall satisfy the
provisions of Section 11(a) of the 1933 Act;
 
(g) (i) use reasonable best efforts to list such Registrable Securities on
NASDAQ, or such other market or exchange representing the principal United
States market or exchange on which the Company’s securities are then listed, to
the extent required and (ii) use reasonable best efforts to provide for a
transfer agent and registrar for such Registrable Securities covered by such
registration statement not later than the effective date of such registration
statement;
 
(h) in connection with an Underwritten Shelf Take-Down, promptly enter into an
underwriting agreement in customary form, which may include indemnification
provisions in favor of underwriters and other Persons in addition to, or in
substitution for, the provisions of Section 3.09, and take such other actions as
the managing underwriters reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities;
 
(i) in connection with an Underwritten Shelf Take-Down, promptly obtain a “cold
comfort” letter or letters from the Company’s independent public accounts in
customary form and covering matters of the type customarily covered by “cold
comfort” letters provided to sellers of securities as the seller or sellers of a
majority of shares of such Registrable Securities shall reasonably request;
 
(j) promptly make available for inspection by any seller of such Registrable
Securities covered by such registration statement, by any underwriter
participating in any disposition to be effected pursuant to such registration
statement and by any attorney, accountant or other agent retained by any such
seller or any such underwriter, all pertinent financial and other records,
pertinent corporate documents and properties of the Company, and cause all of
the Company’s officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with the “due diligence” of such seller or such underwriter
with respect to such registration statement, subject to the execution of a
mutually acceptable confidentiality agreement;
 
 
 
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(k) promptly notify counsel (selected pursuant to Section 3.10) for the Holders
of Registrable Securities included in such registration statement and the
managing underwriter or agent and confirm such notice in writing (i) when the
registration statement, or any post-effective amendment to the registration
statement, shall have become effective, or any supplement to the Prospectus and
any amendments to the Prospectus shall have been filed (other than in the case
of a registration pursuant to Form S-3ASR), (ii) of the receipt of any comments
from the SEC, (iii) of any request by the SEC to amend the registration
statement or amend or supplement the Prospectus or for additional information
and (iv) of the issuance by the SEC of any stop order suspending the
effectiveness of the registration statement or of any order preventing or
suspending the use of any Prospectus, or of the suspension of the qualification
of the registration statement for offering or sale in any jurisdiction, or of
the institution or threatening of any proceedings for any of such purposes;
 
(l) use reasonable best efforts to prevent the issuance of any stop order
suspending the effectiveness of the registration statement or of any order
preventing or suspending the use of any Prospectus and, if any such order is
issued, to obtain the withdrawal of any such order as soon as practicable;
 
(m) (i) if requested by the managing underwriter or agent or any Holder of
Registrable Securities covered by the registration statement, promptly
incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriter or agent or such Holder reasonably
requests to be included therein, including, with respect to the number of
Registrable Securities being sold by such Holder to such underwriter or agent,
the purchase price being paid therefor by such underwriter or agent; and
(ii) make all required filings of such prospectus supplement or post-effective
amendment as soon as practicable after being notified of the matters
incorporated in such prospectus supplement or post-effective amendment;
 
(n) cooperate with the Holders of Registrable Securities covered by the
registration statement and the managing underwriter or agent, if any, to
facilitate the timely preparation and delivery of certificates (not bearing any
restrictive legends) representing securities to be sold under the registration
statement, and enable such securities to be in such denominations and registered
in such names as the managing underwriter or agent, if any, or such Holders may
reasonably request;
 
(o) in connection with an Underwritten Shelf Take-Down, promptly obtain for
delivery to the Holders of Registrable Securities being registered and to the
underwriter or agent an opinion or opinions from counsel for the Company in
customary form and scope for sellers of securities;
 
 
 
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(p) cooperate with each seller of Registrable Securities and each underwriter or
agent participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with the
NASD;
 
(q) use reasonable best efforts to make available certain of the executive
officers of the Company (which in any event shall include the Company’s chief
executive officer) for a ten Business Day period to participate and to cooperate
with the Holders of Registrable Securities and any underwriters in any “road
shows” or other selling efforts, in each case in the United States, that may be
reasonably be requested upon reasonable notice thereof by the Holders in
connection with an Underwritten Shelf Take-Down.
 
Section 3.07.  Information Supplied.  It shall be a condition precedent to the
obligations of the Company to take any action to register the Registrable
Securities held by any Holder as to which any registration is being effected
that such Holder shall furnish the Company with such information regarding such
Holder that is pertinent to the disclosure requirements relating to the
registration and the distribution of such securities as the Company may from
time to time reasonably request.  Each Holder agrees to promptly furnish to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company by such Holder not misleading.
 
Section 3.08.  Expenses.  Except as provided herein, the Company will pay all
Registration Expenses in connection with registrations of Registrable Securities
requested pursuant to Sections 3.01, 3.02, 3.03 or 3.05. Each Holder shall pay
all underwriting discounts and commissions, broker fees and commissions, and
transfer taxes, if any, relating to the sale or disposition of such Holder’s
Registrable Securities pursuant to any registration statement.
 
Section 3.09.  Indemnification. (a) In the event of any registration of any
securities of the Company under the 1933 Act pursuant to Sections 3.01, 3.02,
3.03 or 3.05, to the fullest extent permitted by law, the Company will indemnify
and hold harmless each Holder, each Affiliate of such Holder and their
respective directors and officers, members or general and limited partners (and
the directors, officers, employees, affiliates and each Person who controls such
Holder (within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act) (hereinafter referred to as a “Controlling Person”) of any of the
foregoing), and each underwriter, if any, and each person who controls within
the meaning of Section 15 of the 1933 Act any underwriter (collectively, the
“Seller Indemnified Parties”), against all claims, losses, damages and
liabilities, joint or several, actions or proceedings (whether commenced or
threatened in writing) in respect thereof (“Claims”) and expenses arising out of
or based on: (i)  any untrue statement or alleged untrue statement of a material
fact contained in a registration statement (or any amendment or supplement
thereto), including all documents incorporated therein by reference, or any
omission or alleged omission therefrom of a material fact, in each case,
necessary in order to make the statements therein not misleading, in light of
the circumstances under which they were made, (ii) any untrue statement or
alleged untrue statement of a material fact contained in a Prospectus (or any
amendment or supplement thereto), including all documents incorporated therein
by reference, or any omission or alleged omission therefrom of a material fact,
in each case, necessary in order to make the statements therein not misleading,
in light of the circumstances under which they were made,  or (iii) any untrue
statement or alleged untrue statement of a material fact contained in any Issuer
Free Writing Prospectus prepared by it or authorized by it in writing for use by
such Holder (or any amendment or supplement thereto), including all documents
incorporated therein by reference, or any omission or alleged omission therefrom
of a material fact, in each case, necessary in order to make the statements
therein not misleading, in light of the circumstances under which they were
made, and the Company will reimburse each such Seller Indemnified Party for any
reasonable fees and disbursements of counsel and any other reasonable
out-of-pocket expenses incurred in connection with investigating and defending
or settling any such Claim; provided that the Company will not be liable in any
such case to the extent that any such claim, loss, damage, liability, or action
arises out of or is based on any untrue statement or alleged untrue statement or
omission or alleged omission by such Holder or underwriter but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission is made in such registration statement, Prospectus, or Issuer
Free Writing Prospectus in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Holder and stated
to be specifically for use therein; and provided that, the indemnity agreement
contained in this Section 3.09(a) shall not apply to amounts paid in settlement
of any such Claim if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld or delayed).
 
 
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(b) To the fullest extent permitted by law, each Holder will, if Registrable
Securities held by such Holder are included in the registration statement or
Prospectus, indemnify and hold harmless the Company, all other Holders or any
prospective underwriter, as the case may be, and any of their respective
Affiliates, directors, officers and Controlling Persons (collectively, the
“Company Indemnified Parties”), against all Claims and expenses arising out of
or based on:  (i) any untrue statement or alleged untrue statement of a material
fact contained in a registration statement (or any amendment or supplement
thereto), including all documents incorporated therein by reference, or any
omission or alleged omission therefrom of a material fact, in each case,
necessary in order to make the statements therein not misleading, in light of
the circumstances under which they were made, (ii)  any untrue statement or
alleged untrue statement of a material fact contained in a Prospectus (or any
amendment or supplement thereto), including all documents incorporated therein
by reference, or any omission or alleged omission therefrom of a material fact,
in each case, necessary in order to make the statements therein not misleading,
in light of the circumstances under which they were made or (iii) any untrue
statement or alleged untrue statement of a material fact contained in any Issuer
Free Writing Prospectus (or any amendment or supplement thereto), including all
documents incorporated therein by reference, or any omission or alleged omission
therefrom of a material fact, in each case, necessary in order to make the
statements therein not misleading, in light of the circumstances under which
they were made, and the Holder will reimburse each such Company Indemnified
Party for any reasonable fees and disbursements of counsel and any other
reasonable expenses incurred in connection with investigating and defending or
settling any such Claim, in each case to the extent, but only to the extent that
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, Prospectus, or Issuer Free
Writing Prospectus in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Holder and stated to be
specifically for use therein; provided that the indemnity agreement contained in
this Section 3.09(b) shall not apply to amounts paid in settlement of any such
Claim if such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld or delayed); provided further that in
the absence of fraud by such Holder, the liability of each selling Holder of
Registrable Securities hereunder shall be limited to the net proceeds received
by such selling Holder from the sale of Registrable Securities covered by such
registration statement.
 
(c) Promptly after receipt by a Person entitled to indemnification pursuant to
this Section 3.09 (an “Indemnified Party”) hereunder of written notice of the
commencement of any action or proceeding with respect to which a claim for
indemnification may be made pursuant to this Section 3.09, such Indemnified
Party will, if a claim in respect thereof is to be made against an indemnifying
party, give written notice to the latter of the commencement of such action or
proceeding; provided that the failure of the Indemnified Party to give notice as
provided herein shall not relieve the indemnifying party of its obligations
under this Section 3.09, except to the extent that the indemnifying party is
prejudiced in any material respect by such failure to give notice.  In case any
such action or proceeding is brought against an Indemnified Party, unless in
such Indemnified Party’s reasonable judgment, based upon advice of counsel, a
conflict of interest between such indemnified and indemnifying parties may exist
in respect of such action or proceeding (in which case the Indemnified Party
shall have the right to assume or continue its own defense and the indemnifying
party shall be liable for any reasonable expenses therefor (but in no event will
bear the expenses for more than one firm of counsel for all Indemnified Parties
in each jurisdiction who shall, with respect to Seller Indemnified Parties, be
approved by the majority of the participating Holders in the registration in
respect of which such indemnification is sought), the indemnifying party will be
entitled to participate in and to assume the defense thereof (at its expense),
jointly with any other indemnifying party similarly notified to the extent that
it may wish, with counsel reasonably satisfactory to such Indemnified Party, and
after notice from the indemnifying party to such Indemnified Party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such Indemnified Party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof other than
reasonable costs of investigation and shall have no liability for any settlement
made by the Indemnified Party without the consent of the indemnifying party,
such consent not to be unreasonably withheld.  No indemnifying party will settle
any action or proceeding or consent to the entry of any judgment without the
prior written consent of the Indemnified Party, unless such settlement or
judgment (i) includes as an unconditional term thereof the giving by the
claimant or plaintiff of a release to such Indemnified Party from all liability
in respect of such action or proceeding and (ii) does not involve the imposition
of equitable remedies or the imposition of any obligations on such Indemnified
Party and does not otherwise adversely affect such Indemnified Party, other than
as a result of the imposition of financial obligations for which such
Indemnified Party will be indemnified hereunder.  An Indemnified Party may not
settle any action or proceeding or the entry of any judgment without the prior
written consent of the indemnifying party.
 
 
 
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(d) (i) If the indemnification provided for in this Section 3.09 from the
indemnifying party is unavailable to an Indemnified Party hereunder in respect
of any Claim or expenses referred to herein, then the indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such Claim or expenses in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party and Indemnified Party in connection with the actions which
resulted in such Claim or expenses, as well as any other relevant equitable
considerations.  The relative fault of such indemnifying party and Indemnified
Party shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has been
made by, or relates to information supplied by, such indemnifying party or
Indemnified Party, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such action.  The amount paid
or payable by a party under this Section 3.09(d) as a result of the Claim and
expenses referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such party in connection with any action or
proceeding; and (ii) the parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 3.09(d) were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in clause (i) above.  No
Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
 
(e) The obligations of the parties under this Section 3.09 shall be in addition
to any liability which any party may otherwise have to any other party.
 
Section 3.10.  Selection of Counsel.  In connection with any registration of
Registrable Securities pursuant to Section 3.01, 3.02, 3.03 or 3.05, the Holders
of a majority of the Registrable Securities covered by any such registration may
select one counsel to represent all Holders of Registrable Securities covered by
such registration; provided that in the event that the counsel selected as
provided above is also acting as counsel to the Company in connection with such
registration, a majority of the remaining Holders shall be entitled to select
one additional counsel to represent all such remaining Holders.
 
 
 
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Section 3.11. No Inconsistent Agreements; No Free Writing Prospectus.  The
Company represents and warrants that it is not a party to a Contract which
conflicts with or limits or prohibits the exercise of the rights granted to the
Holders of Registrable Securities in this Article 3.  Each Holder agrees that,
unless it obtains the prior consent of the Company and any such underwriter, it
will not make any offer relating to the Securities that would constitute an
Issuer Free Writing Prospectus, or that would otherwise constitute a “free
writing prospectus,” as defined in Rule 405, required to be filed with the SEC.
 
Section 3.12.  Termination of Registration Rights.   The rights of any Holder
under this Article 3 shall terminate (other than Section 3.07, 3.09 and 3.12) at
such time as such Holder ceases to hold any Registrable Securities.
 
 
ARTICLE 4
Covenants
 
Section 4.01.  Common Stock Option.  (a)  With respect to any offer, sale or
issuance of New Securities, the Company hereby grants to Investor, on the terms
and conditions set forth herein, a continuing right (the “Common Stock Option”)
to purchase from the Company, at the times set forth herein, such number of
shares of Common Stock as is necessary to allow Investor and/or its Affiliates
to maintain its Current Percentage immediately prior to the Issuance Event (as
defined below).  The Common Stock Option shall be assignable, in whole or in
part and from time to time, by Investor to any Affiliate of Investor. The
exercise price for the shares of Common Stock purchased pursuant to the Common
Stock Option shall be the Market Price of the Common Stock as of the date of
first delivery of notice of each exercise of the Common Stock Option by Investor
(or its permitted assignee hereunder) to the Company.
 
(b) At least twenty (20) Business Days prior to the issuance of any New
Securities or the first date on which any event could occur that, in the absence
of a full or partial exercise of the Common Stock Option, would result in a
reduction in its then Current Percentage, the Company will notify Investor in
writing (an “Option Notice”) of any plans that the Company has to issue such New
Securities or the date on which such event could first occur.  The Option Notice
must specify the approximate date on which the Company intends to issue such New
Securities or on which such event could first occur (such issuance or event
being referred to herein as an “Issuance Event” and the date of such issuance or
event as an “Issuance Event Date”), the type and number of New Securities the
Company intends to issue or may issue and the other terms and conditions of such
Issuance Event.
 
 
 
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(c) The Common Stock Option may be exercised by Investor (or any Affiliate of
Investor to which all or any part of the Common Stock Option has been assigned)
for a number of shares of Common Stock that is equal to or one (1) more than the
number of shares of Common Stock that are necessary for Investor to maintain, in
the aggregate, its then Current Percentage. The Common Stock Option may be
exercised at any time after receipt of an Option Notice and prior to the
applicable Issuance Event Date by the delivery to the Company of a written
notice to such effect specifying (i) the number of shares of Common Stock to be
purchased by Investor or any of its Affiliates, and (ii) a calculation of the
exercise price for such shares. Upon any such exercise of the Common Stock
Option, the Company will, prior to the applicable Issuance Event Date, deliver
to Investor (or any Affiliate of Investor designated by Investor), against
payment therefor, certificates (issued in the name of Investor or its permitted
assignee hereunder, or as directed by Investor) representing the shares of
Common Stock being purchased upon such exercise. Payment for such shares shall
be made by wire transfer or intrabank transfer to such account as shall be
specified by the Company, for the full purchase price for such shares.
 
(d) Any failure by Investor to exercise the Common Stock Option, or any exercise
for less than all shares purchasable under the Common Stock Option, in
connection with any particular Issuance Event shall not affect Investor’s right
to exercise the relevant Common Stock  Option in connection with any subsequent
Issuance Event.
 
(e) Notwithstanding anything to the contrary herein, the Company and Investor
acknowledge that the procedures set forth above relating to the exercise of the
Common Stock Option shall not apply where the Company is not capable of giving
advance notice of the relevant Issuance Event.  Investor and the Company agree
that, in such case, the Common Stock Option shall be exercisable at such times
and in such manner as Investor and the Company may from time to time agree, and
otherwise by Investor in a reasonable time and manner.  Notwithstanding anything
to the contrary herein, Investor and the Company agree that where an Issuance
Event relates to the issuance of Company Securities other than shares of Common
Stock, then to the extent Investor has not exercised the Common Stock Option
with respect to such Company Securities at the time of such issuance, at the
time any such Company Securities are exercised, exercisable, converted or
convertible into shares of Common Stock, Investor and its Affiliates shall be
given another opportunity to purchase from the Company such number of shares of
Common Stock that are necessary for the Investor to increase its Current
Percentage to its Current Percentage in effect immediately prior to the
occurrence of such Issuance Event.
 
(f) Notwithstanding anything to the contrary herein, Investor and the Company
agree that where an Issuance Event relates to the issuance of Company Securities
to employees or directors of, or consultants to, the Company or its Subsidiaries
pursuant to equity or equity-incentive plans approved by the Board, the Common
Stock Option shall not apply with respect to such issuance until such time such
issuance (whether by itself or taken in the aggregate along with other issuances
of shares of Common Stock subsequent thereto) would cause the Investor’s Current
Percentage to be reduced by 0.5%, at which time Investor and its Affiliates
shall be given another opportunity to purchase from the Company such number of
shares of Common Stock that are necessary for Investor to increase its Current
Percentage to its Current Percentage in effect immediately prior to the
occurrence of such Issuance Event.
 
 
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Section 4.02.  Common Stock Repurchase Program.  (a) The Company will adopt,
implement as soon as practicable (but not later than thirty (30) days after the
Closing), and maintain a comprehensive, long-term normal course issuer bid (the
“Common Stock Repurchase Program”) for general corporate purposes in accordance
with Applicable Law.
 
(b) The Company shall provide to Investor at the end of each quarter, and at
such other times as Investor may request, information as to (i) the total number
of shares of Common Stock repurchased by the Company in the last quarter, (ii)
the total number of shares of Common Stock outstanding as of such date (on a
Fully-Diluted Basis), (iii) the Company’s current forecasts as to future
issuances of any Company Securities, and (iv) such other information as Investor
may reasonably request in connection with its rights hereunder; and
 
Section 4.03.  No Impediment or Delay.   The Company agrees not to take, and
agrees to cause its directors and officers to refrain from taking, any action
which could impede or delay the exercise by Investor of any of its rights under
this Agreement.
 
Section 4.04   Expiration.  The provisions of Sections 4.01 and 4.02 shall
terminate on the later of (a) the date on which the Investor’s Current
Percentage falls below 20%, and (b) the date on which the Investor (together
with its Affiliates) ceases to be the largest shareholder of the Company.
 
 
ARTICLE 5
Miscellaneous
 
Section 5.01.  Effectiveness.  This Agreement shall have effect as of the
Closing unless expressly stated otherwise.  Notwithstanding any other provision
to the contrary in this Agreement, this Agreement shall not take effect until
the Closing, and in the event the Share Subscription Agreement is terminated,
this Agreement shall be void ab initio.
 
Section 5.02.  Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including facsimile transmission and
electronic mail (“e-mail”) transmission, so long as a receipt of such e-mail is
requested and received), and shall be given,
 
 
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if to Buyer, to:
 
Canon Investment Holdings Limited
Villa 1, Huajing Garden
Jida, Zhuhai
Guangdong, China
Attention: Guohua Sun
Facsimile No.: +86 (756) 325-0839
Email: sun@yingtonggroup.com

with a copy to:
 
Davis Polk & Wardwell LLP
18th Floor, Hong Kong Club Building
3A Chater Road
Central, Hong Kong
Attention: Mark Lehmkuhler
Facsimile No.: +852 2533-3388
Email: mark.lehmkuhler@davispolk.com

if to the Company, to:
 
Altair Nanotechnologies Inc
204 Edison Way
Reno, Nevada 89502
Attention: General Counsel
Facsimile No.: +1 (775) 858-3731
Email: jfallini@altairnano.com

with a copy to:
 
Parr Brown Gee & Loveless
185 South State Street, Suite 800
Salt Lake City, UT 84111
Attention: Bryan T. Allen
Facsimile No.: +1 (801) 532-7750
Email: ballen@parrbrown.com
or such other address or facsimile number as such party may hereafter specify
for the purpose by notice to the other parties hereto.  All such notices,
requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5:00 p.m. in the place of
receipt and such day is a Business Day in the place of receipt.  Otherwise, any
such notice, request or communication shall be deemed not to have been received
until the next succeeding Business Day in the place of receipt.
 
 
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Section 5.03.  Amendments; No Waivers.  (a) Any provision of this Agreement may
be amended or waived if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by Investor and the Company, or in the case
of a waiver, by the party against whom the waiver is to be effective.
 
(b) No failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
 
Section 5.04.  Specific Performance.  The parties hereto agree that irreparable
damage would occur if any provision of this Agreement were not performed in
accordance with the terms hereof and that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement or to enforce
specifically the performance of the terms and provisions hereof in the United
States District Court for the Southern District of New York or any New York
State court sitting in New York City, in addition to any other remedy to which
they are entitled at law or in equity.
 
Section 5.05.  Successors and Assigns.   The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of the other party hereto except as provided herein,
provided that (i) that Investor may transfer or assign its rights and
obligations under this Agreement, in whole or from time to time in part, to one
or more of its Affiliates at any time, and (ii) the registration rights provided
under Article 3 may be assigned to a Holder that agrees to be bound by such
provisions and delivers a counterpart signature page to this Agreement to such
effect.
 
Section 5.06.  Governing Law.   This Agreement shall be governed by and
construed in accordance with the law of the State of New York, without regard to
the conflicts of law rules of such state.
 
Section 5.07.  Jurisdiction.  The parties hereto agree that any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated
hereby shall be brought in the United States District Court for the Southern
District of New York or any New York State court sitting in New York City, so
long as one of such courts shall have subject matter jurisdiction over such
suit, action or proceeding, and that any cause of action arising out of this
Agreement shall be deemed to have arisen from a transaction of business in the
State of New York, and each of the parties hereby irrevocably consents to the
jurisdiction of such courts (and of the appropriate appellate courts therefrom)
in any such suit, action or proceeding and irrevocably waives, to the fullest
extent permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court or
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum.  Process in any such suit, action or
proceeding may be served on any party anywhere in the world, whether within or
without the jurisdiction of any such court. Without limiting the foregoing, each
party agrees that service of process on such party as provided in Section 5.02
shall be deemed effective service of process on such party.
 
 
 
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Section 5.08.  WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
 
Section 5.09. Counterparts; Delivery; Third Party Beneficiaries.  This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument.  Any signed counterpart may be delivered by facsimile or other form
of electronic transmission with the same legal force and effect, for all
purposes, as delivery of an originally signed agreement. No provision of this
Agreement is intended to confer any rights, benefits, remedies, obligations, or
liabilities hereunder upon any Person other than the parties hereto and their
respective successors and assigns.
 
[signature page follows]
 
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the date first above
written.
 

 

 
ALTAIR NANOTECHNOLOGIES, INC.
 
By:
  /s/  
Name:
 
Title:

 
CANON  INVESTMENT HOLDINGS LIMITED
 
By:
  /s/  
Name:
 
Title:

 
 
 
 
 
 
 
 
 
 
 
 
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