Exhibit 10.5


 


Execution Copy


 


REGISTRATION RIGHTS AGREEMENT


 


THIS
REGISTRATION RIGHTS AGREEMENT (this “Agreement”),
dated as of June 13, 2008, by and among
ISONICS CORPORATION, a California corporation (the “Company”),
and the undersigned Buyers listed on Schedule I attached hereto (each, a “Buyer”
and collectively, the “Buyers”).


 


WHEREAS:


 


A.            In
connection with the Securities 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 Securities Purchase Agreement, to issue and sell to the
Buyers (i) notes (the “Notes”), and (ii) warrants (the “Warrants”),
which will be exercisable to purchase shares of Company’s common stock, no par
value per share (the “Common Stock,” as exercised, collectively, the “Warrant
Shares”).  Capitalized terms not
defined herein shall have the meaning ascribed to them in the Securities
Purchase Agreement.


 


B.            To
induce the Buyers to execute and deliver the Securities 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 “Securities Act”), and
applicable state securities laws and other rights as provided for herein.


 


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
the Buyers hereby agree as follows:


 


1.             DEFINITIONS.


 


As used in this Agreement, the
following terms shall have the following meanings:


 


(a)           “Effectiveness
Deadline” means, with respect to a Registration Statement filed hereunder,
the 120th calendar day following the date filed, provided, however, in the
event the Company is notified by the U.S. Securities and Exchange Commission (“SEC”)
that one of the above Registration Statements will not be reviewed or is no
longer subject to further review and comments, the Effectiveness Date as to
such Registration Statement shall be the fifth Trading Day following the date
on which the Company is so notified if such date precedes the dates required
above.


 


(b)           “Filing
Deadline” means, with respect to the initial Registration Statement
required hereunder, the 30th calendar day following the date the Company
receives a Filing Notice provided the Company is eligible to file the initial
Registration Statement.


 


(c)           “Filing
Notice” means a written notice from the Buyer to the Company to file a
Registration Statement and stating the number of Registrable Securities to be
included on such Registration Statement.


 

















 


(d)           “Person”
means a corporation, a limited liability company, an association, a
partnership, an organization, a business, an individual, a governmental or
political subdivision thereof or a governmental agency.


 


(e)           “Prospectus”
means the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from
a prospectus filed as part of an effective registration statement in reliance
upon Rule 430A promulgated under the Securities Act), as amended or
supplemented by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Securities covered by a Registration
Statement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference
or deemed to be incorporated by reference in such Prospectus.


 


(f)            “Registrable
Securities” means all (i) of the Warrant Shares issued or issuable
upon exercise of the Warrants, (ii) any additional shares issuable in
connection with any anti-dilution provisions in the Warrants (without giving
effect to any limitations on exercise set forth in the Warrants) and (iii) any
shares of Common Stock issued or issuable with respect to the Warrant Shares,
or the Warrants as a result of any stock split, dividend or other distribution,
recapitalization or similar event or otherwise, without regard to any
limitations on exercise of the Warrants.


 


(g)           “Registration
Statement” means the registration statements required to be filed hereunder
(including any additional registration statements contemplated by Section 3(c)),
including (in each case) the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.


 


(h)           “Rule 415”
means Rule 415 promulgated by the SEC pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC 
having substantially the same purpose and effect as such Rule.


 


2.             REGISTRATION.


 


(a)           The
Company’s registration obligations set forth in this Section 2 including
its obligations to file Registration Statements (provided the Company is
eligible to file the Registration Statement) upon receipt of Filing Notices,
obtain effectiveness of Registration Statements, and maintain the continuous
effectiveness of Registration Statement that have been declared effective shall
begin on the date hereof and continue until all the Registrable Securities have
been sold or may permanently be sold without any restrictions pursuant to Rule 144,
as determined by the counsel to the Company pursuant to a written opinion
letter to such effect, addressed and acceptable to the Company’s transfer agent
and the affected Holders (the “Registration Period”).


 


(b)           Anytime
during the Registration Period, the Buyer shall have the right to deliver to
the Company a Filing Notice which shall trigger the Company’s obligations to
file a 


 

















 


Registration Statement as set
forth below (provided the Company is eligible to file the Registration
Statement).


 


(c)           After
receipt of a Filing Notice, the Company shall, on or prior to the Filing
Deadline, prepare and file with the SEC a Registration Statement on Form S-1
or SB-2 (or, if the Company is then eligible, on Form S-3) covering the
resale by the Buyer of all of the Registrable Securities set forth in such
Filing Notice.  Each Registration
Statement shall contain the “Selling Stockholders” and “Plan of
Distribution” sections in substantially the form attached hereto as Exhibit A
and contain all the required disclosures set forth on Exhibit B.  The Company shall use its best efforts to
have each Registration Statement declared effective by the SEC as soon as
practicable, but in no event later than the Effectiveness Deadline.  By 9:30 am on the date following the date of
effectiveness, 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. 
Prior to the filing of the Registration Statement with the SEC, the
Company shall furnish a draft of the Registration Statement to the Buyer for
their review and comment.  The Buyer
shall furnish comments on the Registration Statement to the Company within
twenty-four (24) hours of the receipt thereof from the Company.


 


(d)           During
the Registration Period, the Company shall (i) promptly prepare and file
with the SEC such amendments (including post-effective amendments) and
supplements to a Registration Statement and the Prospectus used in connection
with a Registration Statement, which Prospectus is to be filed pursuant to Rule 424
promulgated under the Securities Act, as may be necessary to keep such
Registration Statement effective at all times during the Registration Period, (ii) prepare
and file with the SEC additional Registration Statements in order to register
for resale under the Securities Act all of the Registrable Securities; (ii) cause
the related Prospectus to be amended or supplemented by any required Prospectus
supplement (subject to the terms of this Agreement), and as so supplemented or
amended to be filed pursuant to Rule 424; (iii) respond as promptly as
reasonably possible to any comments received from the SEC with respect to a
Registration Statement or any amendment thereto and as promptly as reasonably
possible provide the Buyers true and complete copies of all correspondence from
and to the SEC relating to a Registration Statement (provided that the Company
may excise any information contained therein which would constitute material
non-public information as to any Buyer which has not executed a confidentiality
agreement with the Company); and (iv) comply with the provisions of the
Securities 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(d))
by reason of the Company’s filing a report on Form 10-K, Form 10-Q or
Form 8-K or any analogous report under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), the Company shall incorporate
such report by reference into the Registration Statement, if applicable, or
shall file such amendments or supplements with the SEC on the same day on which
the Exchange Act report is filed which created the requirement for the Company
to amend or supplement the Registration Statement.


 

















 


(e)           Reduction
of Registrable Securities Included in a Registration Statement.
Notwithstanding anything contained herein, in the event that the SEC requires
the Company to reduce the number of Registrable Securities to be included in a
Registration Statement in order to allow the Company to rely on Rule 415
with respect to a Registration Statement, then the Company shall be obligated
to include in such Registration Statement (which may be a subsequent
Registration Statement if the Company needs to withdraw a Registration
Statement and refile a new Registration Statement in order to rely on Rule 415)
only such limited portion of the Registrable Securities as the SEC shall
permit.  Any Registrable Securities that
are excluded in accordance with the foregoing terms are hereinafter referred to
as “Cut Back Securities.”  To the
extent Cut Back Securities exist, as soon as may be permitted by the SEC, the
Company shall be required to file a Registration Statement covering the resale
of the Cut Back Securities (subject also to the terms of this Section) and
shall use best efforts to cause such Registration Statement to be declared
effective as promptly as practicable thereafter.


 


3.             RELATED
OBLIGATIONS.


 


(a)           The
Company shall, not less than three (3) Trading Days prior to the filing of
each Registration Statement and not less than one (1) Trading Day prior to
the filing of any related amendments and supplements to all Registration
Statements (except for annual reports on Form 10-K), furnish to each Buyer
copies of all such documents proposed to be filed, which documents (other than
those incorporated or deemed to be incorporated by reference) will be subject
to the reasonable and prompt review of such Buyers, The Company shall not file
a Registration Statement or any such Prospectus or any amendments or
supplements thereto to which the Buyers shall reasonably object in good faith; provided that, the Company is notified of such objection in
writing no later than two (2) Trading Days after the Buyers have been so
furnished copies of a Registration Statement.


 


(b)           The
Company shall furnish to each Buyer whose Registrable Securities are included
in any Registration Statement, without charge, (i) at least one (1) copy
of such Registration Statement as declared effective by the SEC and any
amendment(s) thereto, including financial statements and schedules, all
documents incorporated therein by reference, all exhibits and each preliminary
prospectus, (ii) ten (10) copies of the final prospectus included in
such Registration Statement and all amendments and supplements thereto (or such
other number of copies as such Buyer may reasonably request) and (iii) such
other documents as such Buyer may reasonably request from time to time in order
to facilitate the disposition of the Registrable Securities owned by such
Buyer.


 


(c)           The
Company shall use its best efforts to (i) register and qualify the
Registrable Securities covered by a Registration Statement under such other
securities or “blue sky” laws of such jurisdictions in the United States as any
Buyer reasonably requests, (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 (w) make
any change to 


 

















 


its articles of incorporation
or by-laws, (x) qualify to do business in any jurisdiction where it would
not otherwise be required to qualify but for this Section 3(c), (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 each Buyer
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 threat of any proceeding for such purpose.


 


(d)           As
promptly as practicable after becoming aware of such event or development, the
Company shall notify each Buyer in writing of the happening of any event as a
result of which the Prospectus included in a Registration Statement, 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 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 promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and
deliver ten (10) copies of such supplement or amendment to each
Buyer.  The Company shall also promptly
notify each Buyer in writing (i) when a Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and when a Registration
Statement or any post-effective amendment has become effective (notification of
such effectiveness shall be delivered to each Buyer by facsimile on the same
day of such effectiveness), (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.


 


(e)           The
Company shall use its best efforts to prevent the issuance of any stop order or
other suspension of effectiveness of a Registration Statement, or the
suspension of the qualification of any of the Registrable Securities for sale
in any jurisdiction within the United States of America 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 each Buyer 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.


 


(f)            If,
after the execution of this Agreement, a Buyer believes, after consultation
with its legal counsel, that it could reasonably be deemed to be an underwriter
of Registrable Securities, at the request of any Buyer, the Company shall
furnish to such Buyer, on the date of the effectiveness of the Registration
Statement and thereafter from time to time on such dates as a Buyer 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, 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 Buyers.


 


(g)           If,
after the execution of this Agreement, a Buyer believes, after consultation
with its legal counsel, that it could reasonably be deemed to be an underwriter
of 


 

















 


Registrable Securities, at the
request of any Buyer, the Company shall make available for inspection by (i) any
Buyer and (ii) one (1) firm of accountants or other agents retained
by the Buyers (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, and each Buyer hereby
agrees, to hold in strict confidence and shall not make any disclosure (except
to a Buyer) or use  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 Securities
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 than by disclosure in violation of this
or any other agreement of which the Inspector and the Buyer has knowledge.  Each Buyer 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.


 


(h)           The
Company shall hold in confidence and not make any disclosure of information
concerning a Buyer provided to the Company unless (i) disclosure of such
information is necessary to comply with federal or state securities laws, (ii) the
disclosure of such information is necessary to avoid or correct a misstatement
or omission in any Registration Statement, (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 a Buyer is sought in or
by a court or governmental body of competent jurisdiction or through other
means, give prompt written notice to such Buyer and allow such Buyer, at the
Buyer’s expense, to undertake appropriate action to prevent disclosure of, or to
obtain a protective order for, such information.


 


(i)            The
Company shall use its best efforts either to cause all the Registrable
Securities covered by a Registration Statement (i) 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) the
inclusion for quotation on the National Association of Securities Dealers, Inc.
OTC Bulletin Board for such Registrable Securities.  The Company shall pay all fees and expenses
in connection with satisfying its obligation under this Section 3(i).


 


(j)            The
Company shall cooperate with each Buyer who holds Registrable Securities being
offered and, to the extent applicable, to 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 Buyers may reasonably request and registered in such
names as the Buyers may request.


 


(k)           The
Company shall use its best efforts to cause the Registrable Securities covered
by the applicable Registration Statement 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.


 


(l)            The
Company shall otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC in connection with any registration hereunder.


 


(m)          Within
two (2) business days after a Registration Statement which covers
Registrable Securities is declared effective by the SEC, the Company shall
deliver, and shall cause legal counsel for the Company to deliver, to the
transfer agent for such Registrable Securities (with copies to the Buyer whose
Registrable Securities are included in such Registration Statement)
confirmation that such Registration Statement has been declared effective by
the SEC in the form attached hereto as Exhibit C.


 


(n)           The
Company shall take all other reasonable actions necessary to expedite and
facilitate disposition by each Buyer of Registrable Securities pursuant to a Registration
Statement.


 


4.             OBLIGATIONS
OF THE BUYERS.


 


(a)           Each
Buyer agrees that, upon receipt of any notice from the Company of the happening
of any event of the kind described in Section 3(d) such Buyer will
immediately discontinue disposition of Registrable Securities pursuant to any
Registration Statement covering such Registrable Securities until such Buyer’s
receipt of the copies of the supplemented or amended prospectus contemplated by
Section 3(d) or receipt of notice that no supplement or amendment is
required.  Notwithstanding anything to
the contrary, the Company shall cause its transfer agent to deliver unlegended
certificates for shares of Common Stock to a transferee of a Buyer in
accordance with the terms of the Securities Purchase Agreement in connection
with any sale of Registrable Securities with respect to which a Buyer has
entered into a contract for sale prior to the Buyer’s receipt of a notice from
the Company of the happening of any event of the kind described in Section 3(d) and
for which the Buyer has not yet settled.


 


(b)           Each
Buyer covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities 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 expenses incurred in
connection with registrations, filings or qualifications pursuant to Sections 2
and 3, including, without limitation, all registration, listing and
qualifications fees, printers, legal and accounting fees shall be paid by the
Company.


 

















 


6.             INDEMNIFICATION.


 


With respect to Registrable
Securities which are included in a Registration Statement under this Agreement:


 


(a)           To
the fullest extent permitted by law, the Company will, and hereby does,
indemnify, hold harmless and defend each Buyer, the directors, officers,
partners, employees, agents, representatives of, and each Person, if any, who
controls any Buyer within the meaning of the Securities Act or the Exchange Act
(each, an “Indemnified Person”), against any losses, claims, 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 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 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 Securities Act, the Exchange Act, any other law, including,
without limitation, any state securities law, or any rule or regulation
there under relating to the offer or sale of the Registrable Securities
pursuant to a Registration Statement (the matters in the foregoing clauses (i) through
(iii) being, collectively, “Violations”).  The Company shall reimburse the Buyers and
each such controlling person promptly as such expenses are incurred and are due
and payable, for any legal fees or disbursements 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):
(x) 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
expressly for use in connection with the preparation of the Registration Statement
or any such amendment thereof or supplement thereto; (y) shall not be
available to the extent such Claim is based on a failure of the Buyer to
deliver or to cause to be delivered the prospectus made available by the
Company, if such prospectus was timely made available by the Company pursuant
to Section 3(c); and (z) 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. 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 Buyers pursuant to Section 9
hereof.


 


(b)           In
connection with a Registration Statement, each Buyer agrees to severally and
not jointly indemnify, hold harmless and 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, employees,
representatives, or agents and each Person, if any, who controls the Company
within the meaning of the Securities Act or the Exchange Act (each an “Indemnified
Party”), against any Claim or Indemnified Damages to which any of them may
become subject, under the Securities Act, the Exchange Act or otherwise,
insofar as such Claim or Indemnified Damages arise out of or is 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 Buyer expressly for use in connection with
such Registration Statement; and, subject to Section 6(d), such Buyer will
reimburse any legal or other expenses reasonably incurred by them 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 Buyer, which consent shall not be
unreasonably withheld; provided, further, however, that the Buyer 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 Buyer 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
Buyers pursuant to Section 9. 
Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(b) with respect
to any prospectus shall not inure to the benefit of any Indemnified Party if
the untrue statement or omission of material fact contained in the prospectus
was corrected and such new prospectus was delivered to each Buyer prior to such
Buyer’s use of the prospectus to which the Claim relates.


 


(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 (1) counsel for such Indemnified Person or
Indemnified Party to be paid by the indemnifying party, if, in the reasonable
opinion of counsel retained by the indemnifying party, 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.  The
Indemnified Party or Indemnified Person shall cooperate fully 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.  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.


 


(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 seller of Registrable Securities
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any seller 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 net
amount of proceeds received by such seller from the sale of such Registrable
Securities.


 


8.             REPORTS
UNDER THE EXCHANGE ACT.


 


With a view to making available
to the Buyers the benefits of Rule 144 promulgated under the Securities
Act or any similar rule or regulation of the SEC that may at any time
permit the Buyers to sell securities of the Company to the public without
registration (“Rule 144”), and as a material inducement to the
Buyer’s purchase of the Notes, the Company represents, warrants, and covenants
to the following:


 


(a)           The
Company is subject to the reporting requirements of section 13 or 15(d) of
the Exchange Act and has filed all required reports under section 13 or 15(d) of
the 


 

















 


Exchange Act during the 12
months prior to the date hereof (or for such shorter period that the issuer was
required to file such reports), other than Form 8-K reports


 


(b)           During
the Registration Period, the Company shall file with the SEC in a timely manner
all required reports under section 13 or 15(d) of the Exchange Act (it
being understood that nothing herein shall limit the Company’s obligations
under the Securities Purchase Agreement) and such reports shall conform to the
requirement of the Exchange Act and the SEC for filing thereunder except to the
extent (i) the Company is unable  to
issue a management’s assessment on the Company’s internal control of financial
reporting or reports a material weakness in disclosure controls resulting from
the Company’s inability to install a framework for such assessment as required
by §404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations
thereunder, and (ii) the Company’s independent certified public
accountants issue a report on the Company’s financial statements including a
going concern qualification or, following a discussion with the SEC, are
unwilling to issue any report on or review of the Company’s financial
statements (each of (i) and (ii) a “404 Failure”).  The parties hereto acknowledge that as a
result of a 404 Failure, the SEC could refuse to acknowledge the filing of a
report required under section 13 or 15(d) of the Exchange Act.


 


(c)           The
Company shall furnish to each Buyer so long as such Buyer owns Registrable
Securities, promptly upon request, (i) a written statement by the Company
that it has complied with the reporting requirements of Rule 144, (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 Buyers to sell such
securities pursuant to Rule 144 without registration.


 


9.             AMENDMENT
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 Buyers who then hold at least two-thirds
(2/3) of the Registrable Securities.  Any
amendment or waiver effected in accordance with this Section 9 shall be
binding upon each Buyer and the Company. 
No such amendment shall be effective to the extent that it applies to
fewer 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
any of this Agreement unless the same consideration also is offered to all of
the parties to this Agreement.


 


10.           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 or owns the
right to receive the Registrable Securities. 
If the Company receives conflicting instructions, notices or elections
from two (2) or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or
election received from the registered owner of such Registrable Securities.


 

















 


(b)           No
Piggyback on Registrations.  Except
as set forth on Schedule 10(b) attached hereto, neither the Company
nor any of its security holders (other than the Buyers in such capacity
pursuant hereto) may include securities of the Company in the initial
Registration Statement other than the Registrable Securities.  The Company shall not file any other
registration statements until the initial Registration Statement required
hereunder is declared effective by the SEC, provided that this Section 10(b) shall
not prohibit the Company from filing amendments to registration statements
already filed.


 


(c)           Piggy-Back
Registrations.  If at any time there
is not an effective Registration Statement covering all of the Registrable
Securities and the Company shall determine to prepare and file with the SEC a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or equity
securities issuable in connection with the stock option or other employee
benefit plans, then the Company shall send to each Buyer a written notice of
such determination and, if within fifteen (15) days after the date of such
notice, any such Buyer shall so request in writing, the Company shall include
in such registration statement all or any part of such Registrable Securities
such Buyer requests to be registered; provided, however, that,
the Company shall not be required to register any Registrable Securities
pursuant to this Section 10(c) that are eligible for resale pursuant
to Rule 144(k) promulgated under the Securities Act or that are the
subject of a then effective Registration Statement.


 


(d)           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
(1) 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, to:

  	
   

  	
  Isonics Corporation

  
	
   

  	
   

  	
  5906 McIntyre Street

  
	
   

  	
   

  	
  Golden, CO 80403

  
	
   

  	
   

  	
  Attn: Chairman

  
	
   

  	
   

  	
  Telephone: (303) 279-7900

  
	
   

  	
   

  	
  Facsimile: (303) 279-7300

  
	
   

  	
   

  	
   

  
	
  With Copy
  to:

  	
   

  	
  Burns,
  Figa & Will, P.C.

  
	
   

  	
   

  	
  Suite 1000,
  6400 South Fiddlers Green Circle

  
	
   

  	
   

  	
  Greenwood
  Village, CO 80112

  
	
   

  	
   

  	
  Attn:
  Herrick K. Lidstone, Jr., Esq.

  
	
   

  	
   

  	
  Telephone:
  (303) 796-2626

  
	
   

  	
   

  	
  Facsimile:
  (303) 796-2777

  



 


If to an Buyer, to its address
and facsimile number 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.


 


(e)           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.


 


(f)            The
laws of the State of California shall govern all issues concerning the relative
rights of the Company and the Buyers as its stockholders.  All other questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New Jersey, without giving
effect to any choice of law or conflict of law provision or rule (whether
of the State of New Jersey or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New
Jersey.  Each party hereby irrevocably
submits to the non-exclusive jurisdiction of the Superior Courts of the State of
New Jersey, sitting in Hudson County, New Jersey and federal courts for the
District of New Jersey sitting Newark, New Jersey, 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 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.  If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other
jurisdiction.  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.


 


(g)           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)            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.


 


(j)            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 the 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.


 


(k)           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.


 


(l)            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.


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


 
















 


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


 


	
   

  	
  COMPANY:

  
	
   

  	
  ISONICS CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Gregory A. Meadows

  
	
   

  	
  Title:

  	
  Vice President/Assistant Secretary

  
				



 

















 


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


 


	
   

  	
  BUYER:

  
	
   

  	
  YA GLOBAL INVESTMENTS, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Yorkville Advisors, LLC

  
	
   

  	
  Its:

  	
  Investment Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Mark Angelo

  
	
   

  	
  Title:

  	
  Portfolio Manager

  
				



 

















 


Execution Copy


 


SCHEDULE I


 


SCHEDULE OF BUYERS


 


	
  Buyer

  	
   

  	
  Address/Facsimile

  Number of Buyer

  	
   

  	
  Address/Facsimile

  Number of Buyer’s

  Representative

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  YA
  Global Investments, L.P.

  	
   

  	
  101
  Hudson Street – Suite 3700

  	
   

  	
  101
  Hudson Street – Suite 3700

  
	
   

  	
   

  	
  Jersey
  City, NJ 07303

  	
   

  	
  Jersey
  City, NJ 07303

  
	
   

  	
   

  	
  Facsimile:  (201)
  985-8266

  	
   

  	
  Facsimile:  (201)
  985-8266

  
	
   

  	
   

  	
   

  	
   

  	
  Attention:
  David Gonzalez, Esq.

  



 

















 


EXHIBIT A


 


SELLING STOCKHOLDERS


 


AND PLAN OF DISTRIBUTION


 


Selling Stockholders


 


The shares of Common Stock being offered by the selling stockholders
are issuable upon exercise of the warrants. 
For additional information regarding the issuance of those warrants, see
“Private Placement of Warrants” above. 
We are registering the shares of Common Stock in order to permit the
selling stockholders to offer the shares for resale from time to time.  Except as otherwise notes and except for the
ownership of the warrants issued pursuant to the Securities Purchase Agreement,
the selling stockholders have not had any material relationship with us within
the past three years.


 


The table below lists the selling stockholders and other information
regarding the beneficial ownership of the shares of Common Stock by each of the
selling stockholders.  The second column
lists the number of shares of Common Stock beneficially owned by each selling
stockholder, based on its ownership of the warrants, as of
                ,
200  , assuming exercise of the warrants
held by the selling stockholders on that date, without regard to any
limitations on conversions or exercise.


 


The third column lists the shares of Common Stock being offered by this
prospectus by the selling stockholders.


 


In accordance with the terms of a registration rights agreement with
the selling stockholders, this prospectus generally covers the resale of at
least
                      
shares of common stock issued or issuable to the selling stockholders pursuant
to the Securities Purchase Agreement.  Because the exercise price of the
warrants 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 fourth column assumes
the sale of all of the shares offered by the selling stockholders pursuant to
this prospectus.


 


Under the terms of the warrants, a selling stockholder may not exercise
the warrants to the extent such conversion or exercise would cause such selling
stockholder, together with its affiliates, to beneficially own a number of
shares of Common Stock which would exceed 4.99% of our then outstanding shares
of Common Stock following such conversion or exercise, excluding for purposes
of such determination shares of Common Stock issuable upon exercise of the
warrants which have not been exercised. 
The number of shares in the second column does not reflect this
limitation.  The selling stockholders may
sell all, some or none of their shares in this offering.  See “Plan of Distribution.”


 

















 


Execution
Copy


 


	
  Name of
  Selling Stockholder

  	
   

  	
  Number
  of Shares Owned

  Prior to Offering

  	
   

  	
  Maximum
  Number of Shares

  to be Sold Pursuant to this

  Prospectus

  	
   

  	
  Number
  of Shares Owned 

  After Offering

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  YA Global Investments, L.P. (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 






(1)           YA Global Investments, L.P. is a Cayman Island exempt limited partnership.  YA Global is managed by Yorkville Advisors,
LLC.  Investment decisions for Yorkville
Advisors are made by Mark Angelo, its portfolio manager.


 

















 


Plan of Distribution


 


Each Selling Stockholder (the “Selling Stockholders”) of the
common stock and any of their pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of their shares of common stock on the
                    
or any other stock exchange, market or trading facility on which the
shares are traded or in private transactions. 
These sales may be at fixed or negotiated prices.  A Selling Stockholder may use any one or more
of the following methods when selling shares:


 


·                  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;


 


·                  broker-dealers
may agree with the Selling Stockholders to sell a specified number of such
shares at a stipulated price per share;


 


·                  through the writing or settlement of options or other
hedging transactions, whether through an options exchange or otherwise;


 


·                  a combination of any such methods of sale; or


 


·                  any other method permitted pursuant to applicable law.


 


The Selling Stockholders may also sell shares under Rule 144 under
the Securities Act of 1933, as amended (the “Securities Act”), if
available, rather than under this prospectus.


 


Broker-dealers engaged by the Selling Stockholders may arrange for
other brokers-dealers to participate in sales. 
Broker-dealers may receive commissions or discounts from the Selling
Stockholders (or, if any broker-dealer acts as agent for the purchaser of
shares, from the purchaser) in amounts to be negotiated, but, except as set
forth in a supplement to this Prospectus, in the case of an agency transaction
not in excess of a customary brokerage commission in compliance with NASDR Rule 2440;
and in the case of a principal transaction a markup or markdown in compliance
with NASDR IM-2440.


 


In connection with the sale of the common stock or interests therein,
the Selling Stockholders may enter into hedging transactions with broker-dealers
or other financial institutions, which may in turn engage in short sales of the
Common Stock in the course of hedging the positions they assume.  The Selling Stockholders may also enter into
option or other 


 

















 


transactions with broker-dealers or other financial
institutions or the creation of one or more derivative securities which require
the delivery to such broker-dealer or other financial institution of shares
offered by this prospectus, which shares such broker-dealer or other financial
institution may resell pursuant to this prospectus (as supplemented or amended
to reflect such transaction).


 


The Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be “underwriters” within the
meaning of the Securities Act in connection with such sales.  In such event, any commissions received by
such broker-dealers or agents and any profit on the resale of the shares
purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act.  Each Selling
Stockholder has informed the Company that it does not have any written or oral
agreement or understanding, directly or indirectly, with any person to
distribute the Common Stock. In no event shall any broker-dealer receive fees,
commissions and markups which, in the aggregate, would exceed eight percent
(8%).


 


The Company is required to pay certain fees and expenses incurred by
the Company incident to the registration of the shares.  The Company has agreed to indemnify the
Selling Stockholders against certain losses, claims, damages and liabilities,
including liabilities under the Securities Act.


 


Because Selling Stockholders may be deemed to be “underwriters” within
the meaning of the Securities Act, they will be subject to the prospectus
delivery requirements of the Securities Act including Rule 172
thereunder.  In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144
under the Securities Act may be sold under Rule 144 rather than under this
prospectus.  There is no underwriter or
coordinating broker acting in connection with the proposed sale of the resale
shares by the Selling Stockholders.


 


We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule 144(k) under
the Securities Act or any other rule of similar effect or (ii) all of
the shares have been sold pursuant to this prospectus or Rule 144 under
the Securities Act or any other rule of similar effect.  The resale shares will be sold only through
registered or licensed brokers or dealers if required under applicable state
securities laws. In addition, in certain states, the resale shares may not be
sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is
available and is complied with.


 


Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the resale shares may not simultaneously
engage in market making activities with respect to the common stock for the
applicable restricted period, as defined in Regulation M, prior to the commencement
of the distribution.  In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M,
which may limit the timing of purchases and sales of shares of the common stock
by the Selling Stockholders or any other person.  We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a 


 

















 


copy
of this prospectus to each purchaser at or prior to the time of the sale
(including by compliance with Rule 172 under the Securities Act).


 

















 


EXHIBIT B


 


OTHER DISCLOSURES


 


See attachment provided separately.  


 

















 


EXHIBIT C


 


FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT


 


Attention:


 


Re:                               ISONICS CORPORATION


 


Ladies and Gentlemen:


 


We are counsel to Isonics
Corporation, a California corporation (the “Company”), and have
represented the Company in connection with that certain Securities Purchase
Agreement (the “Securities Purchase Agreement”) entered into by and
among the Company and the Buyers named therein (collectively, the “Buyers”).  Pursuant to the Purchase Agreement, the
Company also has entered into a Registration Rights Agreement with the Buyers
(the “Registration Rights Agreement”) pursuant to which the Company
agreed, among other things, to register the Registrable Securities (as defined
in the Registration Rights Agreement) under the Securities Act of 1933, as
amended (the “Securities Act”). 
In connection with the Company’s obligations under the Registration
Rights Agreement, on
                        
        , the Company filed a Registration
Statement on Form                 
(File No. 333-                          )
(the “Registration Statement”) with the Securities and Exchange Commission (the
“SEC”) relating to the Registrable Securities which names each of the
Buyers as a selling stockholder there under.


 


In connection with the
foregoing, we advise you that a member of the SEC’s staff has advised us by
telephone that the SEC has entered an order declaring the Registration
Statement effective under the Securities Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS] and we have no knowledge, after
telephonic inquiry of a member of the SEC’s staff, that any stop order
suspending its effectiveness has been issued or that any proceedings for that
purpose are pending before, or threatened by, the SEC and the Registrable
Securities are available for resale under the Securities Act pursuant to the
Registration Statement.


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Law Firm]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  



 


cc:           [LIST NAMES OF BUYERS]