EXHIBIT 10.2

 
 
EXECUTION COPY

 
REGISTRATION RIGHTS AGREEMENT
 
 
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of November 21, 2012,
by and among Midway Gold Corp., a British Colombia corporation (the "Company"),
and the investors listed on the Schedule of Buyers attached hereto (each, a
"Buyer" and collectively, the "Buyers").
 
WHEREAS:
 
A.           In connection with the Share Purchase Agreement by and among the
parties hereto of even date herewith (the "Securities Purchase Agreement"), the
Company has agreed, upon the terms and subject to the conditions of the Share
Purchase Agreement, to issue and sell to each Buyer Series A Preferred Stock
(the "Preferred Stock"), which will, among other things, be convertible into
common shares in the capital of the Company (the "Common Shares") (as converted,
collectively, the "Conversion Shares").
 
B.           The Preferred Shares may be entitled to dividends, which the
Company, subject to certain conditions, may pay in Common Shares (the "Dividend
Shares").
 
C.           In accordance with the terms of the Share Purchase Agreement, the
Company has agreed to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations thereunder, or any
similar successor statute (collectively, the "1933 Act"), and applicable state
securities laws.
 
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each of the Buyers
hereby agree as follows:
 
1.           Definitions.
 
Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Securities Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
 
(a)           "Additional Effective Date" means the date the Additional
Registration Statement is declared effective by the SEC.
 
(b)           "Additional Effectiveness Deadline" means, subject to
Section 3(r), (i) in the event that the Additional Registration Statement is not
subject to a full review by the SEC, the date which is five Trading
Days  following the date on which the Company is notified by the SEC that the
Additional Registration Statement will not be reviewed or (ii) in the event that
the Additional Registration Statement is subject to a full review by the SEC,
one hundred and eighty (180) calendar days after the earlier of the Additional
Filing Date and the Additional Filing Deadline.
 
(c)           "Additional Filing Date" means the date on which the Additional
Registration Statement is filed with the SEC.
 
(d)           "Additional Filing Deadline" means, subject to Section 3(r), if
Cutback Shares are required to be included in any Additional Registration
Statement, the later of (i) the date sixty (60) days after the date
substantially all of the Registrable Securities registered under the immediately
preceding Registration Statement are sold and (ii) the date six (6) months from
the Initial Effective Date or the most recent Additional Effective Date, as
applicable.
 

 
 

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(e)           "Additional Registrable Securities" means, (i) any Cutback Shares
not previously included on a Registration Statement and (ii) any capital stock
of the Company issued or issuable with respect to the Preferred Stock, the
Conversion Shares, the Dividend Shares or the Cutback Shares, as applicable, as
a result of any stock split, stock dividend, recapitalization, exchange or
similar event or otherwise not previously included on a Registration Statement;
provided, that such securities will cease to be Registrable Securities, when (A)
a Registration Statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and such Registrable Securities
have been disposed of pursuant to such effective Registration Statement, (B)
such securities have been disposed of pursuant to Rule 144 (other than, for the
avoidance of doubt, to Investor or an Affiliate of Investor), (C) such
securities have been disposed of pursuant to Regulation S, or (D) the entire
amount of the Registrable Securities held by Investor and its Affiliates may be
sold in a single sale without any limitation as to volume or manner of sale
requirements pursuant to Rule 144.
 
(f)           "Additional Registration Statement" means a registration statement
or registration statements of the Company filed under the 1933 Act covering any
Additional Registrable Securities.
 
(g)           "Additional Required Registration Amount" means (i) any Cutback
Shares not previously included on a Registration Statement, all subject to
adjustment as provided in Section 2(g) or (ii) such other amount as may be
required by the staff of the SEC pursuant to Rule 415.
 
(h)           "Business Day" means any day other than Saturday, Sunday or any
other day on which commercial banks in the City of New York are authorized or
required by law to remain closed.
 
(i)           “Canadian Prospectus” means a “preliminary prospectus” and a
“prospectus” as those terms are used in Canadian Securities Laws, including all
amendment and supplements thereto.
 
(j)           “Canadian Securities Commissions” means securities commission or
similar regulatory authority in each of the provinces and territories of Canada
or any national securities commission which may be established.
 
(k)           “Canadian Securities Laws” means all applicable securities laws in
each of  the provinces and territories of Canada and the respective rules,
regulations, instruments and published policies, policy statements and notices
thereunder, as amended from time to time.
 
(l)           "Closing Date" shall have the meaning set forth in the Securities
Purchase Agreement.
 
(m)           "Cutback Shares" means any of the Initial Required Registration
Amount or the Additional Required Registration Amount (without regard to clause
(ii) in the definition thereof) of Registrable Securities not included in all
Registration Statements previously declared effective hereunder as a result of a
limitation on the maximum number of Common Shares permitted to be registered by
the staff of the SEC pursuant to Rule 415.  For the purpose of determining the
Cutback Shares, in order to determine any applicable Required Registration
Amount, unless an Investor gives written notice to the Company to the contrary
with respect to the allocation of its Cutback Shares, first the Dividend Shares
shall be excluded on a pro rata basis until all of the Dividend Shares have been
excluded, and second, the Conversion Shares shall be excluded on a pro rata
basis until all of the Conversion Shares have been excluded.
 
(n)           "Effective Date" means the Initial Effective Date and the
Additional Effective Date, as applicable.
 

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(o)           "Effectiveness Deadline" means the Initial Effectiveness Deadline
and the Additional Effectiveness Deadline, as applicable.
 
(p)           "Filing Deadline" means the Initial Filing Deadline and the
Additional Filing Deadline, as applicable.
 
(q)           "Initial Effective Date" means the date that the Initial
Registration Statement has been declared effective by the SEC.
 
(r)           "Initial Effectiveness Deadline" means, subject to Section 3(r),
the date which is (i) in the event that the Initial Registration Statement is
not subject to a full review by the SEC, five Trading Days  following the date
on which the Company is notified by the SEC that the Initial Registration
Statement will not be reviewed or (ii) in the event that the Initial
Registration Statement is subject to a full review by the SEC, one hundred and
eighty (180) calendar days after the Closing Date.
 
(s)           "Initial Filing Date" means the date on which the Initial
Registration Statement is filed with the SEC.
 
(t)           "Initial Filing Deadline" means, subject to Section 3(r), the date
which is ninety (90) calendar days after the Closing Date.
 
(u)           "Initial Registrable Securities" means (i) the Conversion Shares
issued or issuable upon conversion of the Preferred Stock, (ii) the Dividend
Shares issued or issuable with respect to the Preferred Stock and (iii) any
capital stock of the Company issued or issuable with respect to the Preferred
Stock, the Conversion Shares or the Dividend Shares as a result of any stock
split, stock dividend, recapitalization, exchange or similar event or otherwise,
without regard to any limitations on conversion of the Preferred Stock;
provided, that such securities will cease to be Registrable Securities, when (A)
a Registration Statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and such Registrable Securities
have been disposed of pursuant to such effective Registration Statement, (B)
such securities have been disposed of pursuant to Rule 144  (other than, for the
avoidance of doubt, to Investor or an Affiliate of Investor), (C) such
securities have been disposed of pursuant to Regulation S, or (D) the entire
amount of the Registrable Securities held by Investor and its Affiliates may be
sold in a single sale without any limitation as to volume or manner of sale
requirements pursuant to Rule 144.
 
(v)           "Initial Registration Statement" means a registration statement or
registration statements of the Company filed under the 1933 Act covering the
Initial Registrable Securities.
 
(w)           "Initial Required Registration Amount" means 100% of the sum of
(i) the number of Conversion Shares issued and issuable pursuant to the
Company’s Notice of Articles and (ii) the number of Common Shares issuable
pursuant to the Company’s Notice of Articles to satisfy the Preferred Dividend
(as defined in the Company’s Notice of Articles).
 
(x)           "Investor" means a Buyer or any transferee or assignee thereof to
whom a Buyer assigns its rights under this Agreement and who agrees to become
bound by the provisions of this Agreement in accordance with Section 9 and any
transferee or assignee thereof to whom a transferee or assignee assigns its
rights under this Agreement and who agrees to become bound by the provisions of
this Agreement in accordance with Section 9.
 
(y)           "Person" means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.
 

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(z)           "register," "registered," and "registration" refer to a
registration effected by preparing and filing one or more Registration
Statements (as defined below) in compliance with the 1933 Act and pursuant to
Rule 415, and the declaration or ordering of effectiveness of such Registration
Statement(s) by the SEC.
 
(aa)           "Registrable Securities" means the Initial Registrable Securities
and the Additional Registrable Securities.
 
(bb)           "Registration Statement" means the Initial Registration Statement
and the Additional Registration Statement, as applicable.
 
(cc)           "Required Holders" means the so long as they hold Registrable
Securities, [Hale Capital] and thereafter the holders of at least a majority of
the Registrable Securities.
 
(dd)           "Required Registration Amount" means either the Initial Required
Registration Amount or the Additional Required Registration Amount, as
applicable.
 
(ee)           "Rule 415" means Rule 415 promulgated under the 1933 Act or any
successor rule providing for offering securities on a continuous or delayed
basis.
 
(ff)           "SEC" means the United States Securities and Exchange Commission.
 
(gg)           "Trading Day" means any day on which the Common Shares is traded
on the Principal Eligible Market (as defined in the Company’s Notice of
Articles), or, if the Principal Market is not the principal trading market for
the Common Shares, then on the principal securities exchange or securities
market on which the Common Shares is then traded; provided that "Trading Day"
shall not include any day on which the Common Shares is scheduled to trade on
such exchange or market for less than 4.5 hours or any day that the Common
Shares is suspended from trading during the final hour of trading on such
exchange or market (or if such exchange or market does not designate in advance
the closing time of trading on such exchange or market, then during the hour
ending at 4:00:00 p.m., New York time).
 
2.           Registration. 
 
(a)           Initial Mandatory Registration.  The Company shall use all
commercially reasonable efforts to prepare, and use all commercially reasonable
efforts to, as soon as practicable but in no event later than the Initial Filing
Deadline, file with the SEC the Initial Registration Statement on Form S-3 and a
Canadian Prospectus covering the resale of all of the Initial Registrable
Securities.  In the event that Form S-3 is unavailable for such a registration,
the Company shall use such other form as is available for such a registration on
another appropriate form reasonably acceptable to the Required Holders, subject
to the provisions of Section 2(f).  The Initial Registration Statement and
Canadian Prospectus prepared pursuant hereto shall register for resale at least
the number of Common Shares equal to the Initial Required Registration Amount
determined as of the date the Initial Registration Statement is initially filed
with the SEC and with the Canadian Securities Commissions, as applicable,
subject to adjustment as provided in Section 2(g).  The Initial Registration
Statement and Canadian Prospectus shall contain (except if otherwise directed by
the Required Holders) the "Plan of Distribution" and "Selling Shareholders"
sections in substantially the form attached hereto as Exhibit A and Exhibit B.
The Company shall use all commercially reasonable efforts to have the Initial
Registration Statement declared effective by the SEC as soon as practicable, but
in no event later than the Initial Effectiveness Deadline.  By 9:30 a.m. New
York time on the Business Day following the Initial Effective Date, the Company
shall use all commercially reasonable efforts to file with the SEC in accordance
with Rule 424 under the 1933 Act the final prospectus to be used in connection
with sales pursuant to such Initial Registration Statement.

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(b)           Additional Mandatory Registrations.  The Company shall use all
commercially reasonable efforts to prepare, and use all commercially reasonable
efforts to, as soon as practicable but in no event later than the Additional
Filing Deadline, file with the SEC an Additional Registration Statement on Form
S-3 covering the resale of all of the Additional Registrable Securities not
previously registered on an Additional Registration Statement hereunder.  To the
extent the staff of the SEC does not permit the Additional Required Registration
Amount to be registered on an Additional Registration Statement, the Company
shall file Additional Registration Statements successively trying to register on
each such Additional Registration Statement the maximum number of remaining
Additional Registrable Securities until the Additional Required Registration
Amount has been registered with the SEC.  In the event that Form S-3 is
unavailable for such a registration, the Company shall use such other form as is
available for such a registration on another appropriate form reasonably
acceptable to the Required Holders, subject to the provisions of Section
2(f).  Each Additional Registration Statement prepared pursuant hereto shall
register for resale at least that number of Common Shares equal to the
Additional Required Registration Amount determined as of the date such
Additional Registration Statement is initially filed with the SEC, subject to
adjustment as provided in Section 2(g).  Each Additional Registration Statement
shall contain (except if otherwise directed by the Required Holders) the "Plan
of Distribution" and "Selling Shareholders" sections in substantially the form
attached hereto as Exhibit A and Exhibit B.  The Company shall use its best
efforts to have each Additional Registration Statement declared effective by the
SEC as soon as practicable, but in no event later than the Additional
Effectiveness Deadline.  By 9:30 a.m. New York time on the Business Day
following the Additional Effective Date, the Company shall file with the SEC in
accordance with Rule 424 under the 1933 Act the final prospectus to be used in
connection with sales pursuant to such Additional Registration Statement.
 
(c)           Underwritten Registrations. If the Required Holders intend to
distribute the Registrable Securities by means of an underwriting (whether it is
on a firm commitment or best efforts (i.e., registered direct) basis), they
shall so advise the Company in writing and the Company shall give written notice
thereof to all holders of Registrable Securities within ten (10) days of the
receipt of such notice.  In such event, the right of any such holder to include
such holder’s Registrable Securities in such underwriting shall be conditioned
upon such holder’s participation in such underwriting and the inclusion of such
holder’s Registrable Securities in the underwriting (unless otherwise mutually
agreed by a majority in interest of the holders participating in the
underwriting and such holder) to the extent provided herein.  A majority in
interest of the holders of Registrable Securities participating in the
underwriting, in consultation with the Company, shall select the managing
underwriter or underwriters in such underwriting.  All holders proposing to
distribute Registrable Securities through such underwriting shall (together with
the Company) enter into an underwriting agreement in customary form with the
underwriter or underwriters so selected for such underwriting by a majority in
interest of such holders; provided, however, that no holder (or any of their
assignees) shall be required to make any representations, warranties or
indemnities except as they relate to such holder’s ownership of shares and
authority to enter into the underwriting agreement and to such holder’s intended
method of distribution, and the liability of such holder shall be limited to an
amount equal to the net proceeds from the offering received by such
holder.  Notwithstanding any other provision of this Section 2(c), if the
underwriter advises a holder that marketing factors require a limitation of the
number of shares to be underwritten, then the holder shall so advise the Company
and the Company shall so advise all holders of Registrable Securities which
would otherwise be underwritten pursuant hereto, and the number of shares of
Registrable Securities that may be included in the underwriting shall be
allocated as follows: (i) first, among the Buyers that have elected to
participate in such underwritten offering, in proportion (as nearly as
practicable) to the aggregate amount of Registrable Securities held by all such
Buyers, until such Buyers have included in the underwriting all shares requested
by such Buyers to be included, (ii) then, among other holders of Registrable
Securities that have elected to participate in such underwritten offering, in
proportion (as nearly as practicable) to the aggregate amount of Registrable
Securities held by all such holders, until such holders have included in the
underwriting all shares requested by such holders to be included, and (iii)
thereafter, among all other holders of Common Shares, if any, that have the
right and have elected to participate in such underwritten offering, in
proportion (as nearly as practicable) to the amount of Common Shares owned by
such holders.  Without the consent of a majority in interest of the holders of
Registrable Securities participating in a registration referred to in this
Section 2(c), no securities other than Registrable Securities shall be covered
by such registration if the inclusion of such
 
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other securities would result in a reduction of the number of Registrable
Securities covered by such registration or included in any underwriting or if,
in the opinion of the managing underwriter, the inclusion of such other
securities would adversely impact the marketing of such offering.  The Company
shall be obligated to effect only one (1) underwritten registrations under this
2(c) (an offering which is not consummated shall not be counted for this
purpose).
 
(d)           Allocation of Registrable Securities.  The initial number of
Registrable Securities included in any Registration Statement and Canadian
Prospectus and any increase or decrease in the number of Registrable Securities
included therein shall be allocated pro rata among the Investors based on the
number of Registrable Securities held by each Investor at the time the
Registration Statement covering such initial number of Registrable Securities or
increase or decrease thereof is declared effective by the SEC and the Canadian
Securities Commission.  In the event that an Investor sells or otherwise
transfers any of such Investor's Registrable Securities, each transferee shall
be allocated a pro rata portion of the then remaining number of Registrable
Securities included in such Registration Statement for such transferor.  Any
Common Shares included in a Registration Statement and Canadian Prospectus and
which remain allocated to any Person which ceases to hold any Registrable
Securities covered by such Registration Statement and Canadian Prospectus shall
be allocated to the remaining Investors, pro rata based on the number of
Registrable Securities then held by such Investors which are covered by such
Registration Statement and Canadian Prospectus.  In no event shall the Company
include any securities other than Registrable Securities on any Registration
Statement and Canadian Prospectus without the prior written consent of the
Required Holders.
 
(e)           Legal Counsel.  Subject to Section 5, the Required Holders shall
have the right to select one legal counsel to represent the Required Holders and
to review and comment on any Registration Statement or Canadian Prospectus
prepared by the Company pursuant to this Section 2 ("Legal Counsel").  The
Company and Legal Counsel shall reasonably cooperate with each other in
performing the Company's and Investors' obligations under this Agreement.
 
(f)           Ineligibility for Form S-3.  In the event that Form S-3 is not
available for the registration of the resale of Registrable Securities
hereunder, the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the Required
Holders and (ii) undertake to register the Registrable Securities on Form S-3 as
soon as such form is available, provided that the Company shall maintain the
effectiveness of the Registration Statement then in effect until such time as a
Registration Statement on Form S-3 covering the Registrable Securities has been
declared effective by the SEC.
 
(g)           Sufficient Number of Shares Registered.  In the event the number
of shares available under a Registration Statement or Canadian Prospectus filed
pursuant to Section 2(a), Section 2(b) or Section 2(c) is insufficient to cover
all of the Registrable Securities required to be covered by such Registration
Statement or Canadian Prospectus or an Investor's allocated portion of the
Registrable Securities pursuant to Section 2(d), the Company shall amend the
applicable Registration Statement or Canadian Prospectus or file a new
Registration Statement (on the short form available therefor, if applicable) or
Canadian Prospectus or both, so as to cover at least the Required Registration
Amount as of the Trading Day immediately preceding the date of the filing of
such amendment or new Registration Statement or Canadian Prospectus in each
case, using all commercially reasonable efforts to do so as soon as practicable
and not later than thirty (30) days after the necessity therefor arises.  The
Company shall use all commercially reasonable efforts to cause such amendment
and/or new Registration Statement to become effective as soon as practicable
following the filing thereof.  For purposes of the foregoing provision, the
number of shares available under a Registration Statement or Canadian Prospectus
shall be deemed "insufficient to cover all of the Registrable Securities" if at
any time the number of Common Shares available for resale under the Registration
Statement is less than the Required Registration Amount as of such time.  The
determination set forth in the foregoing sentence shall be made without regard
to any limitations on the conversion of the Preferred Stock and such
determination shall assume that the Preferred Stock are then convertible in full
into Common Shares at the then prevailing Conversion Price (as defined in the
Company’s Notice of Articles).
 
 
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(h)           No Cash Settlement.  The parties hereto agree that this Agreement
does not provide for any specific cash settlement or liquidated damage payment
for any failure to (i) cause the Initial Registration Statement to be declared
effective on or before the Initial Effectiveness Deadline, (ii) cause the
Additional Registration Statement to be declared effective on or before the
Additional Effectiveness Deadline, or (iii) fulfil its obligations under Section
2(c), 2(g) or Section 3 of this Agreement.
 
3.           Related Obligations.
 
At such time as the Company is obligated to file a Registration Statement with
the SEC or Canadian Prospectus with the Canadian Securities Commission pursuant
to Section 2(a), 2(b), 2(c), 2(f) or 2(g), the Company will use all commercially
reasonable efforts to effect the registration of the Registrable Securities in
accordance with the intended method of disposition thereof and, pursuant
thereto, the Company shall have the following obligations:
 
(a)           The Company shall promptly prepare and file with the SEC a
Registration Statement and a Canadian Prospectus with the Canadian Securities
Commission with respect to the Registrable Securities and use all commercially
reasonable efforts to cause such Registration Statement or Canadian Prospectus
relating to the Registrable Securities to become effective as soon as
practicable after such filing (but in no event later than the Effectiveness
Deadline).  The Company shall keep each Registration Statement effective
pursuant to Rule 415 at all times until the earlier of (i) the date as of which
the Investors may sell all of the Registrable Securities covered by such
Registration Statement without restriction or limitation pursuant to Rule 144
and without the requirement to be in compliance with Rule 144(c)(1) (or any
successor thereto) promulgated under the 1933 Act or (ii) the date on which the
Investors shall have sold all of the Registrable Securities covered by such
Registration Statement (the "Registration Period").  The Company shall promptly
amend any Registration Statement and Canadian Prospectus as necessary to ensure
that each Registration Statement (including any amendments or supplements
thereto and prospectuses contained therein) does not contain any 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 the case of
prospectuses, in the light of the circumstances in which they were made) not
misleading.  The term "commercially reasonable efforts" shall mean, among other
things and subject to Section 3(r), that the Company shall submit to the SEC,
within two (2) Business Days after the later of the date that (i) the Company
learns that no review of a particular Registration Statement will be made by the
staff of the SEC or that the staff has no further comments on a particular
Registration Statement, as the case may be, and (ii) the approval of Legal
Counsel pursuant to Section 3(c) a request for acceleration of effectiveness of
such Registration Statement to a time and date not later than three (3) Business
Days after the submission of such request.  The Company shall respond in writing
to comments made by the SEC and the Canadian Securities Commission in respect of
a Registration Statement or the Canadian Prospectus as the case may be, as soon
as reasonably practicable after the receipt of comments by or notice from the
SEC that an amendment is required in order for a Registration Statement or the
Canadian Prospectus as the case may be, to be declared effective.
 
(b)           The Company shall prepare and file with the SEC and Canadian
Securities Commission such amendments (including post-effective amendments) and
supplements to a Registration Statement or Canadian Prospectus and the
prospectus used in connection with such Registration Statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the 1933 Act, as may be
necessary to keep such Registration Statement effective at all times during the
Registration Period, and, during such period, comply with the provisions of the
1933 Act with respect to the disposition of all Registrable Securities of the
Company covered by such Registration Statement until such time as all of such
Registrable Securities shall have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof as set forth in
such Registration Statement.  In the case of amendments and supplements to a
Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of the Company filing a
report on Form 10-Q, Form 10-K or any analogous report under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), the Company shall have
incorporated such report by reference into
 
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such Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC on the same day on which the 1934 Act report is filed
which created the requirement for the Company to amend or supplement such
Registration Statement.
 
(c)           The Company shall (A) permit Legal Counsel to review and comment
upon (i) a Registration Statement or Canadian Prospectus at least five (5)
Business Days prior to its filing with the SEC or Canadian Securities
Commission, as the case may be and (ii) all amendments and supplements to all
Registration Statements or Canadian Prospectus (except for Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy
Statements on Schedule 14A and any similar or successor reports or statements)
within a reasonable number of days prior to their filing with the SEC, and (B)
not file any Registration Statement or Canadian Prospectus or amendment or
supplement thereto in a form to which Legal Counsel reasonably objects to the
inclusion of information about the Investors or transactions contemplated by the
Transaction Documents.  All such cost and expense for review and comment shall
be subject to the limits on counsel expenses borne by the Company set forth in
this Agreement.  The Company shall not submit a request for acceleration of the
effectiveness of a Registration Statement or Canadian Prospectus or any
amendment or supplement thereto without the prior approval of Legal Counsel,
which approval shall not be unreasonably withheld.  The Company shall furnish
(which may be electronically) to Legal Counsel, without charge, (i) copies of
any correspondence from the SEC or the staff of the SEC to the Company or its
representatives relating to any Registration Statement, (ii) promptly after the
same is prepared and filed with the SEC, one copy of any Registration Statement
or Canadian Prospectus and any amendment(s) thereto, including financial
statements and schedules, all documents incorporated therein by reference, if
requested by an Investor, and all exhibits and (iii) upon the effectiveness of
any Registration Statement or Canadian Prospectus one copy of the prospectus
included in such Registration Statement and all amendments and supplements
thereto.  The Company shall and Investors shall cause Legal Counsel to
reasonably cooperate with each other in performing the Company's obligations
pursuant to this Section 3.
 
(d)           The Company shall furnish (which may be electronically) to each
Investor whose Registrable Securities are included in any Registration Statement
or Canadian Prospectus without charge,  (i) promptly after the same is prepared
and filed with the SEC, at least one copy of such Registration Statement and any
amendment(s) thereto, including financial statements and schedules, all
documents incorporated therein by reference, if requested by an Investor, all
exhibits and each preliminary prospectus, (ii) upon the effectiveness of any
Registration Statement or Canadian Prospectus ten (10) copies of the prospectus
included in such Registration Statement or Canadian Prospectus and all
amendments and supplements thereto (or such other number of copies as such
Investor may reasonably request) and (iii) such other documents, including
copies of any preliminary or final prospectus, as such Investor may reasonably
request from time to time in order to facilitate the disposition of the
Registrable Securities owned by such Investor.
 
(e)           The Company shall use all commercially reasonable efforts to (i)
register and qualify, unless an exemption from registration and qualification
applies, the resale by Investors of the Registrable Securities covered by a
Registration Statement under such other securities or "blue sky" laws of all
applicable jurisdictions in the United States as the Investors may reasonably
request, (ii) prepare and file in those jurisdictions such amendments (including
post-effective amendments) and supplements to such registrations and
qualifications as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period, and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to (x) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(e), (y) subject itself to general taxation in any such jurisdiction,
or (z) file a general consent to service of process in any such
jurisdiction.  The Company shall promptly notify Legal Counsel and each Investor
who holds Registrable Securities of the receipt by the Company of any
notification with respect to the suspension of the registration or qualification
of any of the Registrable Securities for sale under the securities or "blue sky"
laws of any jurisdiction in the United States or its receipt of actual notice of
the initiation or threatening of any proceeding for such purpose.
 
 
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(f)           The Company shall notify Legal Counsel and each Investor in
writing of the happening of any event, as promptly as practicable after becoming
aware of such event, as a result of which the prospectus included in a
Registration Statement or Canadian Prospectus as then in effect, includes an
untrue statement of a material fact or omission to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(provided that in no event shall such notice contain any material, nonpublic
information), and, subject to Section 3(r), use all commercially reasonable
efforts to promptly prepare a supplement or amendment to such Registration
Statement or Canadian Prospectus to correct such untrue statement or omission,
and deliver ten (10) copies of such supplement or amendment to Legal Counsel and
each Investor (or such other number of copies as Legal Counsel or such Investor
may reasonably request).  The Company shall also promptly notify Legal Counsel
and each Investor in writing (i) when a prospectus or any prospectus supplement
or post-effective amendment has been filed, and when a Registration Statement or
Canadian Prospectus or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to Legal Counsel and each
Investor by facsimile on the same day of such effectiveness and by overnight
mail), (ii) of any request by the SEC for amendments or supplements to a
Registration Statement or related prospectus or related information, and (iii)
of the Company's reasonable determination that a post-effective amendment to a
Registration Statement would be appropriate.  By 9:30 a.m. New York City time on
the date following the date any post-effective amendment has become effective,
the Company shall file with the SEC in accordance with Rule 424 under the 1933
Act the final prospectus to be used in connection with sales pursuant to such
Registration Statement.
 
(g)           The Company shall use all commercially reasonable efforts to
prevent the issuance of any stop order or other suspension of effectiveness of a
Registration Statement or Canadian Prospectus or the suspension of the
qualification of any of the Registrable Securities for sale in any jurisdiction
in the United States or Canada and, if such an order or suspension is issued, to
obtain the withdrawal of such order or suspension at the earliest possible
moment and to notify Legal Counsel and each Investor who holds Registrable
Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
 
(h)           If any Investor is required under applicable securities laws to be
described in the Registration Statement or Canadian Prospectus as an
underwriter, at the reasonable request and at the cost of such Investor, the
Company shall furnish to such Investor, on the date of the effectiveness of the
Registration Statement or Canadian Prospectus and thereafter from time to time
on such dates as an Investor may reasonably request (i) a letter, dated such
date, from the Company's independent certified public accountants in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the Investors, and
(ii) an opinion, dated as of such date, of counsel representing the Company for
purposes of such Registration Statement, in form, scope and substance as is
customarily given in an underwritten public offering, addressed to the
Investors.
 
(i)           If any Investor is required under applicable securities laws to be
described in the Registration Statement or Canadian Prospectus as an
underwriter, the Company shall make available for inspection by (i) such
Investor, (ii) Legal Counsel and (iii) one firm of accountants or other agents
retained by the Investors (collectively, the "Inspectors"), all pertinent
financial and other records, and pertinent corporate documents and properties of
the Company (collectively, the "Records"), as shall be reasonably deemed
necessary by each Inspector, and cause the Company's officers, directors and
employees to supply all information which any Inspector may reasonably request;
provided, however, that each Inspector shall agree to hold in strict confidence
and shall not make any disclosure (except to an Investor) or use of any Record
or other information which the Company determines in good faith to be
confidential, and of which determination the Inspectors are so notified, unless
(a) the disclosure of such Records is necessary to avoid or correct a
misstatement or omission in any Registration Statement or is otherwise required
under the 1933 Act, (b) the release of such Records is ordered pursuant to a
final, non-appealable subpoena or order from a court or government body of
competent jurisdiction, or (c) the information in such Records has been made
generally available to the public other
 
 
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than by disclosure in violation of this Agreement.  Each Investor agrees that it
shall, upon learning that disclosure of such Records is sought in or by a court
or governmental body of competent jurisdiction or through other means, give
prompt notice to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, the Records deemed confidential.  Nothing herein (or in any other
confidentiality agreement between the Company and any Investor) shall be deemed
to limit the Investors' ability to sell Registrable Securities in a manner which
is otherwise consistent with applicable laws and regulations.
 
(j)           The Company shall hold in confidence and not make any disclosure
of information concerning an Investor provided to the Company unless (i)
disclosure of such information is necessary to comply with federal or state
laws, (ii) the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement or Canadian Prospectus
(iii) the release of such information is ordered pursuant to a subpoena or other
final, non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this Agreement or any other
agreement.  The Company agrees that it shall, upon learning that disclosure of
such information concerning an Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
written notice to such Investor and allow such Investor, at the Investor's
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.
 
(k)           The Company shall use all commercially reasonable efforts either
to (i) cause all of the Registrable Securities covered by a Registration
Statement to be listed on each securities exchange on which securities of the
same class or series issued by the Company are then listed, if any, if the
listing of such Registrable Securities is then permitted under the rules of such
exchange or (ii) secure the inclusion for quotation of all of the Registrable
Securities on the TSX Venture Exchange and NYSE MKT or (iii) if, despite the
Company's reasonable best efforts, the Company is unsuccessful in satisfying the
preceding clauses (i) and (ii), to secure the inclusion for quotation on, The
New York Stock Exchange, The NASDAQ Global Select Market, The NASDAQ Global
Market, or The NASDAQ Capital Market for such Registrable Securities and,
without limiting the generality of the foregoing, to use all commercially
reasonable efforts to arrange for at least two market makers to register with
the Financial Industry Regulatory Authority, Inc. ("FINRA") as such with respect
to such Registrable Securities.  The Company shall pay all fees and expenses in
connection with satisfying its obligation under this Section 3(k).
 
(l)           The Company shall cooperate with the Investors who hold
Registrable Securities being offered and, to the extent applicable, facilitate
the timely preparation and delivery of certificates (not bearing any restrictive
legend) representing the Registrable Securities to be offered pursuant to a
Registration Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the Investors may reasonably request and
registered in such names as the Investors may request.
 
(m)           If requested by an Investor, the Company shall as soon as
practicable (i) incorporate in a prospectus supplement or post-effective
amendment such information as an Investor reasonably requests to be included
therein necessary to the sale and distribution of Registrable Securities,
including, without limitation, information with respect to the number of
Registrable Securities being offered or sold, the purchase price being paid
therefor and any other terms of the offering of the Registrable Securities to be
sold in such offering; (ii) make all required filings of such prospectus
supplement or post-effective amendment after being notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment; and
(iii) supplement or make amendments to any Registration Statement or Canadian
Prospectus if reasonably requested by an Investor holding any Registrable
Securities.
 
(n)           The Company shall use all commercially reasonable efforts to cause
the Registrable Securities covered by a Registration Statement or Canadian
Prospectus to be registered with or approved by such other governmental agencies
or authorities as may be necessary to consummate the disposition of such
Registrable Securities.
 
 
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(o)           The Company shall make generally available to its security holders
as soon as practical, but not later than ninety (90) days after the close of the
period covered thereby, an earnings statement or statements of the Company and
its subsidiaries which will satisfy the provisions of Section 11(a) of, and
Rule 158 under, the U.S. Securities Act.
 
(p)           The Company shall otherwise use all commercially reasonable
efforts to comply with all applicable rules and regulations of the SEC in
connection with any registration hereunder.
 
(q)           Within two (2) Business Days after a Registration Statement which
covers Registrable Securities is ordered effective by the SEC, the Company shall
deliver to the transfer agent for such Registrable Securities (with copies to
the Investors whose Registrable Securities are included in such Registration
Statement) confirmation that such Registration Statement has been declared
effective by the SEC.
 
(r)           Notwithstanding anything to the contrary herein, at any time prior
to an Initial Filing Deadline or Additional Filing Deadline, Initial
Effectiveness Deadline or Additional Effectiveness Deadline (any of which
deadline would be extended by any Allowable Grace Period) or after the Effective
Date, the Company may delay the disclosure of material, non-public information
concerning the Company the disclosure of which at the time is not, in the good
faith opinion of the Board of Directors of the Company and its counsel, in the
best interest of the Company and, in the opinion of counsel to the Company,
otherwise required (a "Grace Period"); provided, that the Company shall promptly
(i) notify the Investors in writing of the existence of material, non-public
information giving rise to a Grace Period (provided that in each notice the
Company will not disclose the content of such material, non-public information
to the Investors) and the date on which the Grace Period will begin, and (ii)
notify the Investors in writing of the date on which the Grace Period ends; and,
provided further, that no Grace Period shall exceed fifteen (15) consecutive
days and during any three hundred sixty five (365) day period such Grace Periods
shall not exceed an aggregate of forty-five (45) days and the first day of any
Grace Period must be at least five (5) Trading Days after the last day of any
prior Grace Period (each, an "Allowable Grace Period").  For purposes of
determining the length of a Grace Period above, the Grace Period shall begin on
and include the date the Company delivers to Investors the notice referred to in
clause (i) and shall end on and include the later of the date the Company
delivers to Investors the notice referred to in clause (ii) and the date
referred to in such notice.  The provisions of Section 3(g) hereof shall not be
applicable during the period of any Allowable Grace Period.  Upon expiration of
the Grace Period, the Company shall again be bound by the first sentence of
Section 3(f) with respect to the information giving rise thereto unless such
material, non-public information is no longer applicable.  Notwithstanding
anything to the contrary, the Company shall cause its transfer agent to deliver
unlegended Common Shares to a transferee of an Investor in accordance with the
terms of the Securities Purchase Agreement in connection with any sale of
Registrable Securities with respect to which an Investor has entered into a
contract for sale, prior to the Company’s delivery  of the notice of a Grace
Period and for which the Investor has not yet settled.
 
(s)           Neither the Company nor any Subsidiary or affiliate thereof shall
identify any Buyer as an underwriter in any public disclosure or filing with the
SEC, the Principal Market (as defined in the Securities Purchase Agreement) or
any Eligible Market and any Buyer being deemed an underwriter by the SEC shall
not relieve the Company of any obligations it has under this Agreement or any
other Transaction Document (as defined in the Securities Purchase Agreement);
provided, however, that the foregoing shall not prohibit the Company from
including the disclosure found in the "Plan of Distribution" section attached
hereto as Exhibit A in the Registration Statement.
 
(t)           The Company shall not file any other registration statements
until, or grant registration rights to any Person that can be exercised prior to
the time that, all Registrable Securities are registered pursuant to a
Registration Statement that is declared effective by the SEC, provided that this
Section 3(t) shall not prohibit the Company from filing (i) registration
statements on Form S-8 for Company equity plans or (ii) amendments
(pre-effective and post-effective) to registration statements filed prior to the
date of this Agreement; provided that no such amendment shall increase the
number of securities registered on a registration statement.  Neither the
Company nor any of its
 
 
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Subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its Subsidiaries, on or after the date of this Agreement, without the consent of
the Required Holders, enter into any agreement with respect to its securities,
that would have the effect of impairing the rights granted to the Buyers in this
Agreement or otherwise conflicts with the provisions hereof.
 
(u)           If holders of a majority of the Registrable Securities being
offered pursuant to a Registration Statement select underwriters (whether on a
firm commitment or best efforts basis) for the offering, the Company shall enter
into and perform its obligations under an underwriting (or similar) agreement,
in usual and customary form, including, without limitation, by providing
customary legal opinions, comfort letters and indemnification and contribution
obligations.
 
(v)           In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering.
 
4.           Obligations of the Investors.
 
(a)           At least five (5) Business Days prior to the first anticipated
filing date of a Registration Statement, the Company shall notify each Investor
in writing of the information the Company requires from each such Investor if
such Investor elects to have any of such Investor's Registrable Securities
included in such Registration Statement or Canadian Prospectus.  It shall be a
condition precedent to the obligations of the Company to complete any
registration pursuant to this Agreement with respect to the Registrable
Securities of a particular Investor that such Investor shall furnish to the
Company such information regarding itself, the Registrable Securities held by it
and the intended method of disposition of the Registrable Securities held by it
as shall be reasonably required to effect and maintain the effectiveness of the
registration of such Registrable Securities and shall execute such documents in
connection with such registration as the Company may reasonably request.
 
(b)           Each Investor, by such Investor's acceptance of the Registrable
Securities, agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of any Registration
Statement or Canadian Prospectus hereunder, unless such Investor has notified
the Company in writing of such Investor's election to exclude all of such
Investor's Registrable Securities from such Registration Statement or Canadian
Prospectus.
 
(c)           Each Investor agrees that, upon the Company’s delivery of any
notice from the Company of the happening of any event of the kind described in
Section 3(g) or the first sentence of 3(f) or Section 3(r), such Investor will
immediately discontinue disposition of Registrable Securities pursuant to any
Registration Statement(s) or Canadian Prospectus covering such Registrable
Securities until the Company’s delivery  of copies of the supplemented or
amended prospectus as contemplated by Section 3(g) or the first sentence of 3(f)
or Section 3(r) or delivery of notice that no supplement or amendment is
required.  Notwithstanding anything to the contrary, the Company shall cause its
transfer agent to deliver unlegended Common Shares to a transferee of an
Investor in accordance with the terms of the Securities Purchase Agreement in
connection with any sale of Registrable Securities with respect to which an
Investor has entered into a contract for sale prior to the delivery of a notice
by the Company of the happening of any event of the kind described in Section
3(g) or the first sentence of 3(f) or Section 3(r) and for which the Investor
has not yet settled.
 
(d)           Each Investor covenants and agrees that it will comply with the
prospectus delivery requirements of the 1933 Act as applicable to it or an
exemption therefrom in connection with sales of Registrable Securities pursuant
to the Registration Statement.
 
5.           Expenses of Registration.
 
All reasonable expenses incurred by the Company, other than underwriting
discounts and commissions or expenses, incurred in connection with
registrations, filings or qualifications pursuant to
 
 
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Sections 2 and 3, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, and fees and disbursements of
counsel for the Company shall be paid by the Company.  The Company shall also
reimburse the Investors for the fees and disbursements of Legal Counsel in
connection with registration, filing or qualification pursuant to Sections 2 and
3 of this Agreement which amount shall be limited to $10,000 for each such
Registration Statement (including, without duplication, all filings and
amendments made thereof or incorporated by reference in such Registration
Statement for which no separate amount will be payable).
 
6.           Indemnification.
 
In the event any Registrable Securities are included in a Registration Statement
or Canadian Prospectus under this Agreement:
 
(a)           To the fullest extent permitted by law, the Company will, and
hereby does, indemnify, hold harmless and defend each Investor, the investment
manager and its affiliates, the directors, officers, partners, members,
employees, agents, representatives of, and each Person, if any, who controls, or
is under common control with any Investor within the meaning of the 1933 Act or
the 1934 Act (each, an "Indemnified Person"), against any losses, damages,
liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys'
fees, amounts paid in settlement or expenses, joint or several (collectively,
"Claims"), incurred in investigating, preparing or defending any action, claim,
suit, inquiry, proceeding, investigation or appeal taken from the foregoing by
or before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified
party is or may be a party thereto ("Indemnified Damages"), to which any of them
may become subject insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based
upon:  (i) any untrue statement or alleged untrue statement of a material fact
in a Registration Statement or Canadian Prospectus or any post-effective
amendment thereto or in any filing made in connection with the qualification of
the offering under the securities or other "blue sky" laws of any jurisdiction
in which Registrable Securities are offered ("Blue Sky Filing"), or the omission
or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement or Canadian Prospectus or contained in the final prospectus (as
amended or supplemented, if the Company files any amendment thereof or
supplement thereto with the SEC) or the omission or alleged omission to state
therein any material fact necessary to make the statements made therein, in
light of the circumstances under which the statements therein were made, not
misleading, or (iii) any violation or alleged violation by the Company of the
1933 Act, the 1934 Act, any other securities law, including, without limitation,
any state securities law, or any rule or regulation thereunder relating to the
offer or sale of the Registrable Securities pursuant to a Registration Statement
or Canadian Prospectus (the matters in the foregoing clauses (i) through (iii)
being, collectively, "Violations").  Subject to Section 6(c), the Company shall
reimburse the Indemnified Persons, promptly as such expenses are incurred and
are due and payable, for any legal fees or other reasonable expenses incurred by
them in connection with investigating or defending any such
Claim.  Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a):  (i) shall not apply
to a Claim by an Indemnified Person arising out of or based upon a Violation
which occurs in reliance upon and in conformity with information furnished in
writing to the Company by such Indemnified Person for such Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or Canadian Prospectus or any such amendment thereof or supplement
thereto, if such prospectus was timely made available by the Company pursuant to
Section 3(d); and (ii) shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the
Company, which consent shall not be unreasonably withheld or delayed.  Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Indemnified Person and shall survive the transfer of
the Registrable Securities by the Investors pursuant to Section 9.
 
(b)           In connection with any Registration Statement in which an Investor
is participating, each such Investor agrees to severally and not jointly
indemnify, hold harmless and
 
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defend, to the same extent and in the same manner as is set forth in Section
6(a), the Company, each of its directors, each of its officers who signs the
Registration Statement and each Person, if any, who controls the Company within
the meaning of the 1933 Act or the 1934 Act (each, an "Indemnified Party"),
against any Claim or Indemnified Damages to which any of them may become
subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or
Indemnified Damages arise out of or are based upon any Violation, in each case
to the extent, and only to the extent, that such Violation occurs in reliance
upon and in conformity with written information furnished to the Company by such
Investor expressly for use in connection with such Registration Statement; and,
subject to Section 6(c), such Investor shall reimburse the Indemnified Party for
any legal or other expenses reasonably incurred by an Indemnified Party in
connection with investigating or defending any such Claim; provided, however,
that the indemnity agreement contained in this Section 6(b) and the agreement
with respect to contribution contained in Section 7 shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent shall not be unreasonably
withheld or delayed; provided, further, however, that the Investor shall be
liable under this Section 6(b) for only that amount of a Claim or Indemnified
Damages as does not exceed the net proceeds to such Investor as a result of the
sale of Registrable Securities pursuant to such Registration Statement.  Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party and shall survive the transfer of
the Registrable Securities by the Investors pursuant to Section 9.
 
(c)           Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action or
proceeding (including any governmental action or proceeding) involving a Claim,
such Indemnified Person or Indemnified Party shall, if a Claim in respect
thereof is to be made against any indemnifying party under this Section 6,
deliver to the indemnifying party a written notice of the commencement thereof,
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or
the Indemnified Party, as the case may be; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel with the fees and expenses of not more than one counsel for all such
Indemnified Person or Indemnified Party to be paid by the indemnifying party,
if, in the reasonable opinion of counsel retained by the Indemnified Person or
Indemnified Party, as applicable, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding.  In the case of an Indemnified Person, legal counsel
referred to in the immediately preceding sentence shall be selected by the
Investors holding at least a majority in interest of the Registrable Securities
included in the Registration Statement to which the Claim relates.  The
Indemnified Party or Indemnified Person shall cooperate reasonably with the
indemnifying party in connection with any negotiation or defense of any such
action or Claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Indemnified Party or
Indemnified Person which relates to such action or Claim.  The indemnifying
party shall keep the Indemnified Party or Indemnified Person fully apprised at
all times as to the status of the defense or any settlement negotiations with
respect thereto.  No indemnifying party shall be liable for any settlement of
any action, claim or proceeding effected without its prior written consent,
provided, however, that the indemnifying party shall not unreasonably withhold,
delay or condition its consent.  No indemnifying party shall, without the prior
written consent of the Indemnified Party or Indemnified Person, consent to entry
of any judgment or enter into any settlement or other compromise which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party or Indemnified Person of a release from all liability
in respect to such Claim or litigation and such settlement shall not include any
admission as to fault on the part of the Indemnified Party.  Following
indemnification as provided for hereunder, the indemnifying party shall be
subrogated to all rights of the Indemnified Party or Indemnified Person with
respect to all third parties, firms or corporations relating to the matter for
which indemnification has been made.  The failure to deliver written notice to
the indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is prejudiced in its ability to defend such
action.
 
 
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(d)           The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.
 
(e)           The indemnity agreements contained herein shall be in addition to
(i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.
 
7.           Contribution.
 
To the extent any indemnification by an indemnifying party is prohibited or
limited by law, the indemnifying party agrees to make the maximum contribution
with respect to any amounts for which it would otherwise be liable under Section
6 to the fullest extent permitted by law; provided, however, that: (i) no Person
involved in the sale of Registrable Securities which Person is guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) in connection with such sale shall be entitled to contribution from any
Person involved in such sale of Registrable Securities who was not guilty of
fraudulent misrepresentation; and (ii) contribution by any seller of Registrable
Securities shall be limited in amount to the amount of net proceeds received by
such seller from the sale of such Registrable Securities pursuant to such
Registration Statement.
 
8.           Reports Under the 1934 Act.
 
With a view to making available to the Investors the benefits of Rule 144
promulgated under the 1933 Act or any other similar rule or regulation of the
SEC that may at any time permit the Investors to sell securities of the Company
to the public without registration ("Rule 144"), the Company agrees to:
 
(a)           make and keep public information available, as those terms are
understood and defined in Rule 144;
 
(b)           file with the SEC in a timely manner all reports and other
documents required of the Company under the 1933 Act and the 1934 Act so long as
the Company remains subject to such requirements and the filing of such reports
and other documents is required for the applicable provisions of Rule 144; and
 
(c)           furnish to each Investor so long as such Investor owns Registrable
Securities, promptly upon request and to the extent not available on the SEC’s
EDGAR website, (i) a written statement by the Company, if true, that it has
complied with the reporting requirements of Rule 144, the 1933 Act and the 1934
Act, (ii) a copy of the most recent annual or quarterly report of the Company
and such other reports and documents so filed by the Company, and (iii) such
other information as may be reasonably requested to permit the Investors to sell
such securities pursuant to Rule 144 without registration.
 
9.           Assignment of Registration Rights.
 
The rights under this Agreement shall be automatically assignable by the
Investors to any transferee of all or any portion of such Investor's Registrable
Securities if:  (i) the Investor agrees in writing with the transferee or
assignee to assign such rights and the transferee or assignee agrees in writing
to assume in full the obligations set forth under this Agreement, including the
obligations set forth under Sections 6 and 7, and a copy of such agreement is
furnished to the Company within a reasonable time after such assignment; (ii)
the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (a) the name and address of such transferee or
assignee, and (b) the securities with respect to which such registration rights
are being transferred or assigned; (iii) immediately following such transfer or
assignment the further disposition of such securities by the transferee or
assignee is restricted under the 1933 Act or applicable state securities laws;
(iv) at or before
 
 
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the time the Company receives the written notice contemplated by clause (ii) of
this sentence the transferee or assignee agrees in writing with the Company to
be bound by all of the provisions contained herein; and (v) such transfer shall
have been made in accordance with the applicable requirements of the Securities
Purchase Agreement.  Following any such transfer or assignment, the transferee
or assignee, as applicable, shall be considered an Investor for purposes of this
Agreement.
 
10.           Amendment and Termination of Registration Rights.
 
Provisions of this Agreement may be amended and the observance thereof may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Required
Holders.  Any amendment or waiver effected in accordance with this Section 10
shall be binding upon each Investor and the Company.  No such amendment shall be
effective to the extent that it applies to less than all of the holders of the
Registrable Securities.  No consideration shall be offered or paid to any Person
to amend or consent to a waiver or modification of any provision of this
Agreement unless the same consideration also is offered to all of the parties to
this Agreement.  Other than Sections 6 and 7, this Agreement shall terminate
with respect to any Investor when such Investor is no longer a holder of
Registrable Securities and shall terminate with respect to all Investors when
securities issued pursuant to the Share Purchase Agreement are not Registrable
Securities.

 
11.           Miscellaneous.
 
(a)           A Person is deemed to be a holder of Registrable Securities
whenever such Person owns or is deemed to own of record such Registrable
Securities.  If the Company receives conflicting instructions, notices or
elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or
election received from such record owner of such Registrable Securities.
 
(b)           Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered:  (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile (provided confirmation of
transmission is mechanically or electronically generated and kept on file by the
sending party); or (iii) one Business Day after deposit with a nationally
recognized overnight delivery service, in each case properly addressed to the
party to receive the same.  The addresses and facsimile numbers for such
communications shall be:
 
If to the Company:

 
Midway Gold Corp.

 
Suite 280 – 8310 South Valley Highway

 
Englewood, Colorado  80112

 
Facsimile:  720-979-0898

 
Attention:  Kenneth Brunk, Chief Execituve Officer

 
Email:  Kbrunk@midwaygold.com

 
 
 
16
 

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With a copy (for informational purposes only) to:

 

 
Dorsey & Whitney LLP
1400 Wewatta Street, Suite 400
Denver, CO  80202
  Facsimile: 303-629-3450   Email: sam.kenneth@dorsey.com   Attention: Kenneth
Sam, Esq.

                                             
If to the Buyers:
 

 
HCP-MID, LLC
EREF-MID II, LLC
INV-MID, LLC
c/o Hale Fund Management, LLC, Managing Member
570 Lexington Ave, 49th Floor
New York, NY 10022
Attention:  Martin M. Hale , Jr.
  Facsimile: 212-751-8822   Email: martin@halefunds.com

 
If to Legal Counsel:
 

 
Osler, Hoskin & Harcourt LLP
Box 50, 1 First Canadian Place
Toronto, Ontario, Canada  M5X 1B8 Telephone:
  Facsimile: 416.862.6666   Attention: Mark Trachuk, Esq.

    
If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers attached hereto, with copies to such Buyer's representatives as set forth
on the Schedule of Buyers, or to such other address and/or facsimile number
and/or to the attention of such other Person as the recipient party has
specified by written notice given to each other party five (5) days prior to the
effectiveness of such change.  Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.
 
(c)           Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
 
(d)           All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by the internal laws of
the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any jurisdictions
other than the State of New York.  Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in The City of
New York, Borough of Manhattan, for the adjudication of any dispute hereunder or
in connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper.  Each party hereby irrevocably waives personal service of process and
consents to process being served in any
 
 
17
 

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such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT
OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
 
(e)           If any provision of this Agreement is prohibited by law or
otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or
unenforceable shall be deemed amended to apply to the broadest extent that it
would be valid and enforceable, and the invalidity or unenforceability of such
provision shall not affect the validity of the remaining provisions of this
Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter
hereof and the prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the respective
expectations or reciprocal obligations of the parties or the practical
realization of the benefits that would otherwise be conferred upon the
parties.  The parties will endeavor in good faith negotiations to replace the
prohibited, invalid or unenforceable provision(s) with a valid provision(s), the
effect of which comes as close as possible to that of the prohibited, invalid or
unenforceable provision(s).
 
(f)           This Agreement, the other Transaction Documents (as defined in the
Securities Purchase Agreement) and the instruments referenced herein and therein
constitute the entire agreement among the parties hereto with respect to the
subject matter hereof and thereof.  There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
therein.  This Agreement, the other Transaction Documents and the instruments
referenced herein and therein supersede all prior agreements and understandings
among the parties hereto with respect to the subject matter hereof and thereof.
 
(g)           Subject to the requirements of Section 9, this Agreement shall
inure to the benefit of and be binding upon the permitted successors and assigns
of each of the parties hereto.
 
(h)           The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.'
 
(i)           All references in this Agreement to Sections, Subsections,  and
Exhibits are references to Sections, Subsections, and Exhibits, respectively, in
and to this Agreement, unless otherwise specified. All words used in this
Agreement will be construed to be of such gender or number as the circumstances
require. The words “include” or “including” mean “include, without limitation”
or “including, without limitation,” as the case may be, and the language
following “include” or “including” shall not be deemed to set forth an
exhaustive list. Any capitalized terms used in any Exhibit but not otherwise
defined therein shall have the meaning as defined in this Agreement. All
Exhibits annexed hereto or referred to herein are hereby incorporated in and
made a part of this Agreement as if set forth herein. All references to notices,
or other items “written” or “in writing” may include writings in e-mail.
 
(j)           This Agreement may be executed in identical counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement.  This Agreement, once executed by a party, may be delivered to
the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement and a facsimile
or electronic (.pdf) signature shall constitute an original for all purposes..
 
(k)           Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as any other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
 
 
18
 

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(l)           All consents and other determinations required to be made by the
Investors pursuant to this Agreement shall be made, unless otherwise specified
in this Agreement, by the Required Holders.
 
(m)           The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
 
(n)           This Agreement is intended for the benefit of the parties hereto
and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.
 
(o)           The obligations of each Investor hereunder are several and not
joint with the obligations of any other Investor, and no provision of this
Agreement is intended to confer any obligations on any Investor vis-à-vis any
other Investor.  Nothing contained herein, and no action taken by any Investor
pursuant hereto, shall be deemed to constitute the Investors as a partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that the Investors are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated herein.
 
* * * * * *
 
[Signature Page Follows]
 
 
 
 
 
 
 

19
 

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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Registration Rights Agreement to be duly executed as of
the date first written above.
 

  COMPANY:       MIDWAY GOLD CORP.       By:                          Name: 
Kenneth Brunk     Title:    Chief Executive Officer

 
 
 
 

 
 
[Signature Page to Registration Rights Agreement]
 
 

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Registration Rights Agreement to be duly executed as of
the date first written above.
 

  BUYER:       HCP-MID, LLC       By:                          Name:  Martin M.
Hale, Jr.     Title:    Hale Fund Management, LLC,    
Managing Member

 
 

 
[Signature Page to Registration Rights Agreement]
 
 

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Registration Rights Agreement to be duly executed as of
the date first written above.
 

  BUYER:       EREF-MID II, LLC       By:                          Name:  Martin
M. Hale, Jr.     Title:    Hale Fund Management, LLC,    
Managing Member

 
 
 
 
 
[Signature Page to Registration Rights Agreement]
 
 

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Registration Rights Agreement to be duly executed as of
the date first written above.
 

  BUYER:       INV-MID, LLC       By:                          Name:  Martin M.
Hale, Jr.     Title:    Hale Fund Management, LLC,    
Managing Member

 
 

 

 
[Signature Page to Registration Rights Agreement]
 
 

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SCHEDULE OF BUYERS

Buyer
Buyer Address
   
 HCP-MID, LLC
c/o Hale Fund Management, LLC, Managing Member
570 Lexington Ave, 49th Floor
New York, NY 10022
Attention:  Martin M. Hale , Jr.
 EREF-MID II, LLC
c/o Hale Fund Management, LLC, Managing Member
570 Lexington Ave, 49th Floor
New York, NY 10022
Attention:  Martin M. Hale , Jr.
 INV-MID, LLC
c/o Hale Fund Management, LLC, Managing Member
570 Lexington Ave, 49th Floor
New York, NY 10022
Attention:  Martin M. Hale , Jr.
   

 
 
 
 

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EXHIBIT A
SELLING SHAREHOLDERS
 
The Common Shares being offered by the selling shareholders are those issuable
to the selling shareholders upon conversion of the convertible preferred stock
and in payment of certain dividend requirements with respect to the preferred
stock.  For additional information regarding the issuance of those convertible
preferred stock, see "Private Placement of Convertible Preferred Stock "
above.  We are registering the Common Shares in order to permit the selling
shareholders to offer the shares for resale from time to time.  Except for the
ownership of the convertible preferred stock issued pursuant to the Securities
Purchase Agreement, the selling shareholders have not had any material
relationship with us within the past three years.
 
The table below lists the selling shareholders and other information regarding
the beneficial ownership of the Common Shares by each of the selling
shareholders.  The second column lists the number of Common Shares beneficially
owned by each selling shareholder, based on its ownership of the convertible
preferred stock, as of ________, 2012. The third column lists the number of
Common Shares being offered by this prospectus by the selling shareholders.  The
fourth column lists the number of Common Shares that will be held by the selling
shareholders after the sale of all Common Shares offered by this prospectus and
the fifth column lists the percentage of ownership of the Company’s issued and
outstanding Common Shares the selling shareholder will hold after the sale of
all Common Shares offered by this prospectus. Beneficial ownership in the is
determined in accordance with the rules of the SEC and includes voting or
investment power with respect to securities.  The numbers in the following table
assume that none of the selling shareholders sell any Common Shares not being
offered in this prospectus or purchase additional common shares, and assume that
all Common Shares offered are sold.
 
As of ____________, 2012, we had ____________ common shares issued and
outstanding
 
In accordance with the terms of a registration rights agreement with the selling
shareholders, this prospectus generally covers the resale of at least 100% of
the sum of (i) the number of Common Shares issuable upon conversion of the
convertible preferred stock as of the Trading Day immediately preceding the date
the registration statement is initially filed with the SEC and (ii) the number
of Common Shares issuable as dividends with respect to the preferred stock as of
the Trading Day immediately preceding the date the registration statement is
initially filed with the SEC, subject to any limit on the number of shares
issuable by the NYSE MKT or the TSX-V. Because the conversion price of the
convertible preferred stock may be adjusted, the number of shares that will
actually be issued may be more or less than the number of shares being offered
by this prospectus.
 
The selling shareholders may sell all, some or none of their Common Shares in
this offering.  The selling shreholders are not making any representation that
any Common Shares covered by this prospectus will be offered for sale. The
selling shareholders  reserve the right to accept or reject, in whole or in
part, any proposed sale of Common Shares.  See "Plan of Distribution."
 

 
Exhibit A-Page 1
 

 
 

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Name of Selling shareholder
Number of Common
Shares Owned Prior
to Offering
Maximum Number of
Common Shares to be
Sold Pursuant to this
Prospectus
Number of
Common Shares
Owned After
Offering
 
Percentage of
Common Shares
Owned After
Offering
         
[Buyers] (1)
   
0
 
 
[Other Buyers]
 
       
TOTAL
       

 
* Less than 1%
 
(a)
All percentages are based on ______________ Common Shares issued and outstanding
on ____________, 2012.  Beneficial ownership is calculated by the number of
Common Shares that each selling shareholder owns or controls or has the right to
acquire within 60 days of the date of this prospectus.

(b)
This table assumes that each selling shareholder will sell all of its Common
Shares available for resale during the effectiveness of the registration
statement that includes this prospectus.  Selling shareholders are not required
to sell their Common Shares.

(1)
● is a limited partnership.  ________________ the ___________of ● exercises
investment and voting control over these securities.

 

 

 

 
Exhibit A-Page 2
 

 
 

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EXHIBIT B
 
PLAN OF DISTRIBUTION
 
We are registering the Common Shares issuable upon conversion of the convertible
preferred stock and in payment of certain dividend requirements with respect to
the preferred stock to permit the resale of these Common Shares by the holders
of the convertible preferred stock from time to time after the date of this
prospectus.  We will not receive any of the proceeds from the sale by the
selling shareholders of the Common Shares.  We will bear all fees and expenses
incident to our obligation to register the Common Shares.
 
The selling shareholders may sell all or a portion of the Common Shares
beneficially owned by them and offered hereby from time to time directly or
through one or more underwriters, broker-dealers or agents.  If the Common
Shares are sold through underwriters or broker-dealers, the selling shareholders
will be responsible for underwriting discounts or commissions or agent's
commissions.  The Common Shares may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of the sale, at varying prices
determined at the time of sale, or at negotiated prices.  These sales may be
effected in transactions, which may involve crosses or block transactions,
 
 
●
on any national securities exchange or quotation service on which the securities
may be listed or quoted at the time of sale;

 
 
●
in the over-the-counter market;

 
 
●
in transactions otherwise than on these exchanges or systems or in the
over-the-counter market;

 
 
●
through the writing of options, whether such options are listed on an options
exchange or otherwise;

 
 
●
ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

 
 
●
block trades in which the broker-dealer will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to facilitate
the transaction;

 
 
●
purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;

 
 
●
an exchange distribution in accordance with the rules of the applicable
exchange;

 
 
●
privately negotiated transactions;

 
 
●
short sales as permitted by applicable law;

 
 
●
sales pursuant to Rule 144;

 
 
●
broker-dealers may agree with the selling shareholders to sell a specified
number of such shares at a stipulated price per share;

 
 
●
a combination of any such methods of sale; and

 
 
●
any other method permitted pursuant to applicable law.

 

 
Exhibit B-Page 1
 

 
 

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If the selling shareholders effect such transactions by selling Common Shares to
or through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts,
concessions or commissions from the selling shareholders or commissions from
purchasers of the Common Shares for whom they may act as agent or to whom they
may sell as principal (which discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those
customary in the types of transactions involved).  In connection with sales of
the Common Shares or otherwise, the selling shareholders may enter into hedging
transactions with broker-dealers as permitted by applicable law, which may in
turn engage in short sales of the Common Shares in the course of hedging in
positions they assume.  The selling shareholders may also sell Common Shares
short as permitted by applicable law and deliver Common Shares covered by this
prospectus to close out short positions and to return borrowed shares in
connection with such short sales.  The selling shareholders may also loan or
pledge Common Shares to broker-dealers that in turn may sell such shares.
 
The selling shareholders may pledge or grant a security interest in some or all
of the convertible preferred stock or Common Shares owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the Common Shares from time to time pursuant to this
prospectus or any amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act of 1933, as amended, amending, if
necessary, the list of selling shareholders to include the pledgee, transferee
or other successors in interest as selling shareholders under this
prospectus.  The selling shareholders also may transfer and donate the Common
Shares in other circumstances in which case the transferees, donees, pledgees or
other successors in interest will be the selling beneficial owners for purposes
of this prospectus.
 
The selling shareholders and any broker-dealer participating in the distribution
of the Common Shares may be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act, and any commission paid, or any discounts
or concessions allowed to, any such broker-dealer may be deemed to be
underwriting commissions or discounts under the Securities Act.  At the time a
particular offering of the Common Shares is made, a prospectus supplement, if
required, will be distributed which will set forth the aggregate amount of
Common Shares being offered and the terms of the offering, including the name or
names of any broker-dealers or agents, any discounts, commissions and other
terms constituting compensation from the selling shareholders and any discounts,
commissions or concessions allowed or reallowed or paid to broker-dealers.
 
Under the securities laws of some states, the Common Shares may be sold in such
states only through registered or licensed brokers or dealers.  In addition, in
some states the Common Shares may not be sold unless such shares have been
registered or qualified for sale in such state or an exemption from registration
or qualification is available and is complied with.
 
There can be no assurance that any selling shareholder will sell any or all of
the Common Shares registered pursuant to the registration statement, of which
this prospectus forms a part.
 
The selling shareholders and any other person participating in such distribution
will be subject to applicable provisions of the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder, including, without
limitation, Regulation M of the Exchange Act, which may limit the timing of
purchases and sales of any of the Common Shares by the selling shareholders and
any other participating person.  Regulation M may also restrict the ability of
any person engaged in the distribution of the Common Shares to engage in
market-making activities with respect to the Common Shares.  All of the
foregoing may affect the marketability of the Common Shares and the ability of
any person or entity to engage in market-making activities with respect to the
Common Shares.
 
We will pay all expenses of the registration of the Common Shares pursuant to
the registration rights agreement, estimated to be $[     ] in total, including,
without limitation, Securities and Exchange Commission filing fees and expenses
of compliance with state securities or "blue sky" laws; provided, however, that
a selling shareholder will pay all underwriting discounts and selling
commissions, if any.  We will indemnify the selling shareholders against
liabilities, including some liabilities under the Securities
 
 

 
Exhibit B-Page 2
 

 
 

--------------------------------------------------------------------------------

 
 
Act, in accordance with the registration rights agreements, or the selling
shareholders will be entitled to contribution.  We may be indemnified by the
selling shareholders against liabilities, including liabilities under the
Securities Act, that may arise from any written information furnished to us by
the selling shareholder specifically for use in this prospectus, in accordance
with the related registration rights agreement, or we may be entitled to
contribution.
 
Once sold under the registration statement, of which this prospectus forms a
part, the Common Shares will be freely tradable in the hands of persons other
than our affiliates.
 

 
 
 
 
 
 

 
Exhibit B-Page 3
 

 
 

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