Exhibit
10.2


REGISTRATION
RIGHTS AGREEMENT


This Registration Rights Agreement (this “Agreement”)
is made and entered into as of August 2, 2007, among Callisto Pharmaceuticals,
Inc., a Delaware corporation (the “Company”), and the purchasers
signatory hereto (each such purchaser is a “Purchaser” and all such
purchasers are, collectively, the “Purchasers”).


This
Agreement is made pursuant to the Securities Purchase Agreement, dated as of
the date hereof among the Company and the Purchasers (the “Purchase Agreement”).


The Company and the Purchasers hereby agree as
follows:


1. Definitions


Capitalized terms used and not
otherwise defined herein that are defined in the Purchase Agreement shall have
the meanings given such terms in the Purchase Agreement. As
used in this Agreement, the following terms shall have the following meanings:


“Advice”
shall have the meaning set forth in Section 7(c).


“Effectiveness
Date” means, with respect to the initial Registration Statement required to
be filed hereunder, 90 calendar days after the Closing Date and, with respect
to any additional Registration Statements which may be required pursuant to
Section 3(c), the 90th calendar day following the date on which the
Company first knows, or reasonably should have known, that such additional
Registration Statement is required hereunder; provided, however,
in the event the Company is notified by the Commission 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.


“Effectiveness
Period” shall have the meaning set forth in Section 2(a).


“Event”
shall have the meaning set forth in Section 2(b).


“Event Date”
shall have the meaning set forth in Section 2(b).


“Filing Date”
means, with respect to the initial Registration Statement required hereunder,
the 45th calendar day following the Closing Date and,
with respect to any additional Registration Statements which may be required
pursuant to Section 3(c), the 45th day following the date on which the Company
first knows, or reasonably should have known that such additional Registration
Statement is required hereunder.


“Holder” or
“Holders” means the holder or holders, as the case may be, from time to
time of Registrable Securities.













“Indemnified
Party” shall have the meaning set forth in Section 5(c) hereof.


“Indemnifying
Party” shall have the meaning set forth in Section 5(c) hereof.


“Losses” shall have the meaning set forth in
Section 5(a).


“Proceeding” means an action, claim, suit,
investigation or proceeding (including, without limitation, an investigation or
partial proceeding, such as a deposition), whether commenced or threatened.


“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.


“Registrable
Securities” means, as of the date in question, (i) all of the shares of
Common Stock issuable upon conversion in full of the shares of Preferred Stock,
(ii) all Warrant Shares, (iii) any securities issued or issuable upon any stock
split, dividend or other distribution recapitalization or similar event with
respect to the foregoing and (iv) any additional shares issuable in connection
with any anti-dilution provisions associated with the Preferred Stock and
Warrants.


“Registration
Statement” means the registration statements required to be filed hereunder
and 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.


“Rule 415”
means Rule 415 promulgated by the Commission 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 Commission having substantially the same purpose and
effect as such Rule.


“Rule 424”
means Rule 424 promulgated by the Commission 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 Commission having substantially the same purpose and
effect as such Rule.


2. Shelf Registration


(a)  On or prior to each Filing Date, the Company
shall prepare and file with the Commission a “Shelf” Registration Statement
covering the resale of 100% of the Registrable Securities on such Filing Date
for an offering to be made on a continuous basis pursuant to Rule













415.  The Registration Statement shall be on Form
S-3 (except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith) and shall contain (unless
otherwise directed by the Holders) substantially the “Plan of Distribution”
attached hereto as Annex A. 
Subject to the terms of this Agreement, the Company shall use its
commercially reasonable efforts to cause the Registration Statement to be
declared effective under the Securities Act as promptly as possible after the
filing thereof, but in any event prior to the applicable Effectiveness Date,
and shall use its commercially reasonable efforts to keep such Registration
Statement continuously effective under the Securities Act until the earliest of
(i) the date when the Holder may sell all Registrable Securities under Rule 144
or other rule promulgated by the SEC without volume or other restrictions or
limits, provided that the Company has furnished the Holder with an opinion
letter of legal counsel to such effect or (ii) the date the Holders no longer
own any of the Registrable Securities (the “Effectiveness Period”).  The Company shall immediately notify the
Holders via facsimile or e-mail of the effectiveness of the Registration Statement
on the same day that the Company receives notification of the effectiveness
from the Commission.


(b) Provided the
following events are not caused by a failure of any Purchaser to fulfill their
obligations pursuant to Section 3(a) of this Agreement if: (i) a Registration
Statement is not filed on or prior to its Filing Date, (ii) the Company fails
to file with the Commission a request for acceleration in accordance with Rule
461 promulgated under the Securities Act, within five Trading Days of the date
that the Company is notified (orally or in writing, whichever is earlier) by
the Commission that a Registration Statement will not be “reviewed,” or not
subject to further review, (iii) a Registration Statement filed or required to
be filed hereunder is not declared effective by the Commission by its
Effectiveness Date, or (iv) after the Effectiveness Date, the availability of
the Registration and Prospectus is suspended for more than an aggregate of 60
days in any 12-month period (any such failure or breach being referred to as an
“Event”, and for purposes
of clause (i) or (iii) the date on which such Event occurs, or for purposes of
clause (ii) the date on which such five Trading Day period is exceeded being
referred to as “Event Date”),
then in addition to any other rights the Holders may have hereunder or under
applicable law, on each monthly anniversary of each such Event Date (if the
applicable Event shall not have been cured by such date) until the applicable
Event is cured, the Company shall pay to each Holder an amount in cash, as
partial liquidated damages and not as a penalty, equal to 1% of the aggregate
purchase price paid by such Holder pursuant to the Purchase Agreement for any
Registrable Securities then held by such Holder, provided that partial
liquidated damages shall not be paid with respect to those Registrable
Securities which cannot be registered under Rule 415 solely as a result of
action by the Commission. The partial liquidated damages pursuant to the terms
hereof shall apply on a daily pro-rata basis for any portion of a month prior
to the cure of an Event and shall not exceed an aggregate of 18% of the
aggregate purchase price paid by the Purchasers pursuant to this Agreement.


3. Registration Procedures


In connection with the Company’s registration
obligations hereunder, the Company shall:













(a)                                  Not
less than four (4) Trading Days prior to the filing of each Registration
Statement or any related Prospectus or any amendment or supplement thereto
(including any document that would be incorporated or deemed to be incorporated
therein by reference), the Company shall, (i) furnish to each Holder 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
review of such Holders, and (ii) cause its officers and directors, counsel and
independent certified public accountants to respond to such inquiries as shall
be necessary, in the reasonable opinion of respective counsel to conduct a
reasonable investigation within the meaning of the Securities Act. The Company
shall not file the Registration Statement or any such Prospectus or any
amendments or supplements thereto to which the Holders of a majority of the
Registrable Securities shall reasonably object in good faith, provided that,
the Company is notified of such objection, including the substance of such
objection, in writing no later than two Trading Days after the Holders have
been so furnished copies of such documents. Each Holder, severally and not
jointly agrees to furnish to the Company a completed Questionnaire in the form
attached to this Agreement as Annex B (a “Selling
Holder Questionnaire”) not less
than ten Trading Days prior to the Filing Date.


(b)                                 (i)
Prepare and file with the Commission such amendments, including post-effective
amendments, to a Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously
effective as to the applicable Registrable Securities for the Effectiveness
Period and prepare and file with the Commission such 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
Commission with respect to a Registration Statement or any amendment thereto;
and (iv) comply in all material respects with the provisions of the Securities
Act and the Exchange Act with respect to the disposition of all Registrable
Securities covered by a Registration Statement during the applicable period in
accordance (subject to the terms of this Agreement) with the intended methods
of disposition by the Holders thereof set forth in such Registration Statement
as so amended or in such Prospectus as so supplemented.


(c)                                  If
during the Effectiveness Period, the number of Registrable Securities at any
time exceeds the number of shares of Common Stock then registered in a
Registration Statement, then the Company shall file as soon as reasonably
practicable but in any case prior to the applicable Filing Date, an additional
Registration Statement covering the resale by the Holders of such additional
Registrable Securities.


(d)                                 Notify
the Holders of Registrable Securities to be sold (which notice shall, pursuant
to clauses (ii) through (vi) hereof, be accompanied by an instruction to
suspend the use of the Prospectus until the requisite changes have been made)
as promptly as reasonably possible (and, in the case of (i)(A) below, not less
than five Trading Days prior to such filing) and (if requested by any such
Person) confirm such notice in writing no later than one Trading Day following
the day (i)(A) when a Prospectus or any Prospectus supplement or post-effective
amendment to a Registration Statement is proposed to be filed; (B) when the
Commission













notifies the Company whether there will be a “review” of such
Registration Statement and whenever the Commission comments in writing on such
Registration Statement; and (C) with respect to a Registration Statement or any
post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to a Registration Statement or Prospectus or for
additional information; (iii) of the issuance by the Commission or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement covering any or all of the
Registrable Securities or the initiation of any Proceedings for that purpose;
(iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Registrable Securities for sale in any jurisdiction, or the initiation or
threatening of any Proceeding for such purpose; (v) of the occurrence of any
event or passage of time that makes the financial statements included in a
Registration Statement ineligible for inclusion therein or any statement made
in a Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect
or that requires any revisions to a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus,
as the case may be, it will not contain any untrue statement of a material fact
or omit to state any 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; and (vi) the occurrence or existence of any pending
corporate development with respect to the Company that the Company believes may
be material and that, in the determination of the Company, makes it not in the
best interest of the Company to allow continued availability of the
Registration Statement or Prospectus; provided that any and all of such
information shall remain confidential to each Holder until such information
otherwise becomes public, unless disclosure by a Holder is required by law; provided,
further, notwithstanding each Holder’s agreement to keep such
information confidential, the Holders make no acknowledgement that any such
information is material, non-public information.


(e)                                  Use its commercially reasonable efforts to
avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order
suspending the effectiveness of a Registration Statement, or (ii) any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest
practicable moment.


(f)                                    Furnish
to each Holder, without charge, at its request, at least one conformed copy of
each such Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.


(g)                                 Promptly
deliver to each Holder, without charge, as many copies of the Prospectus or
Prospectuses (including each form of prospectus) and each amendment or
supplement thereto as such Persons may reasonably request in connection with
resales by the Holder of Registrable Securities.  Subject to the terms of this Agreement, the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders in connection with the
offering and sale of the Registrable Securities covered by













such Prospectus and any amendment or supplement thereto, except after
the giving on any notice pursuant to Section 3(d).


(h)                                 Prior
to any resale of Registrable Securities by a Holder, use its commercially
reasonable efforts to register or qualify or cooperate with the selling Holders
in connection with the registration or qualification (or exemption from the
Registration or qualification) of such Registrable Securities for the resale by
the Holder under the securities or Blue Sky laws of such jurisdictions within
the United States as any Holder reasonably requests in writing, to keep each
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period and to do any and all other acts or things reasonably
necessary to enable the disposition in such jurisdictions of the Registrable
Securities covered by each Registration Statement; provided, that the Company
shall not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified, subject the Company to any material tax in
any such jurisdiction where it is not then so subject or file a general consent
to service of process in any such jurisdiction.


(i)                                     If
requested by the Holders, cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to a Registration Statement, which
certificates shall be free, to the extent permitted by the Purchase Agreement,
of all restrictive legends, and to enable such Registrable Securities to be in
such denominations and registered in such names as any such Holders may
request.


(j)                                     Upon
the occurrence of any event contemplated by this Section 3, as promptly as
reasonably possible under the circumstances taking into account the Company’s
good faith assessment of any adverse consequences to the Company and its
stockholders of the premature disclosure of such event, prepare a supplement or
amendment, including a post-effective amendment, to a Registration Statement or
a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document
so that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies the Holders in accordance with clauses
(ii) through (v) of Section 3(d) above to suspend the use of any Prospectus
until the requisite changes to such Prospectus have been made, then the Holders
shall suspend use of such Prospectus. 
The Company will use its commercially reasonable efforts to ensure that
the use of the Prospectus may be resumed as promptly as is practicable.  The Company shall be entitled to exercise its
right under this Section 3(j) to suspend the availability of a Registration
Statement and Prospectus, for a period not to exceed aggregate 60 days (which
need not be consecutive days) in any 12 month period.


(k)                                  Comply
with all applicable rules and regulations of the Commission.


(l)                                     The
Company may require each selling Holder to furnish to the Company a certified
statement as to the number of shares of Common Stock beneficially owned by such
Holder and, if required by the Commission, the person thereof that has voting
and dispositive control over the Shares. During any periods that the Company is
unable to meet its obligations













hereunder with respect to the registration of the Registrable
Securities solely because any Holder fails to furnish such information within
five Trading Days of the Company’s request, any liquidated damages that are
accruing at such time as to such Holder only shall be tolled and any Event that
may otherwise occur solely because of such delay shall be suspended as to such
Holder only, until such information is delivered to the Company.


4. Registration Expenses. All fees and expenses
incident to the performance of or compliance with this Agreement by the Company
shall be borne by the Company whether or not any Registrable Securities are
sold pursuant to the Registration Statement. The fees and expenses referred to
in the foregoing sentence shall include, without limitation, (i) all
registration and filing fees (including, without limitation, fees and expenses
(A) with respect to filings required to be made with the Trading Market on
which the Common Stock is then listed for trading, and (B) in compliance with
applicable state securities or Blue Sky laws reasonably agreed to by the
Company in writing (including, without limitation, fees and disbursements of
counsel for the Company in connection with Blue Sky qualifications or
exemptions of the Registrable Securities and determination of the eligibility
of the Registrable Securities for investment under the laws of such
jurisdictions as requested by the Holders), (ii) printing expenses (including,
without limitation, expenses of printing certificates for Registrable
Securities), (iii) messenger, telephone and delivery expenses, (iv) fees and
disbursements of counsel for the Company, (v) Securities Act liability
insurance, if the Company so desires such insurance, and (vi) fees and expenses
of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement.  In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation
of the transactions contemplated by this Agreement (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the expense of any annual audit and the fees and
expenses incurred in connection with the listing of the Registrable Securities
on any securities exchange as required hereunder.  In no event shall the Company be responsible
for any broker or similar commissions or any legal fees or other costs of the
Holders.


5. Indemnification


(a) Indemnification
by the Company. The Company shall, notwithstanding any termination
of this Agreement, indemnify and hold harmless each Holder, the officers,
directors, agents and employees of each of them, each Person who controls any
such Holder (within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act) and the officers, directors, agents and employees of
each such controlling Person, to the fullest extent permitted by applicable
law, from and against any and all losses, claims, damages, liabilities, costs
(including, without limitation, reasonable attorneys’ fees) and expenses
(collectively, “Losses”), as incurred, arising out of or relating to any
untrue or alleged untrue statement of a material fact contained in a
Registration Statement, any Prospectus or any form of prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus or form of prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading, except
to the extent, but only to the extent, that (i) such untrue statements or
omissions are based solely upon information regarding such Holder furnished in
writing to the Company by such













Holder
expressly for use therein, or to the extent that such information relates to
such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in a Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto (it being understood that
the Holder has approved Annex A hereto for this purpose) or (ii) in the case of
an occurrence of an event of the type specified in Section 3(d)(ii)-(vi), the
use by such Holder of an outdated or defective Prospectus after the Company has
notified such Holder in writing that the Prospectus is outdated or defective
and prior to the receipt by such Holder of the Advice contemplated in Section
7(c).  The Company shall notify the
Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware.


(b) Indemnification
by Holders. Each Holder shall, severally and not jointly, indemnify
and hold harmless the Company, its directors, officers, agents and employees,
each Person who controls the Company (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors,
officers, agents or employees of such controlling Persons, to the fullest
extent permitted by applicable law, from and against all Losses, as incurred,
to the extent arising out of or based solely upon any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, any
Prospectus, or any form of prospectus, or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading to the extent, but
only to the extent, that (1) such untrue statements or omissions are based
solely upon information regarding such Holder furnished in writing to the Company
by such Holder expressly for use therein, or to the extent that such
information relates to such Holder or such Holder’s proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by such Holder expressly for use in the Registration Statement (it
being understood that the Holder has approved Annex A hereto for this purpose),
such Prospectus or such form of Prospectus or in any amendment or supplement
thereto or (2) in the case of an occurrence of an event of the type specified
in Section 3(d)(ii)-(vi), the use by such Holder of an outdated or defective
Prospectus after the Company has notified such Holder in writing that the
Prospectus is outdated or defective and prior to the receipt by such Holder of the
Advice contemplated in Section 7(c). In no event shall the liability of any
selling Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.


(c) Conduct
of Indemnification Proceedings. If any Proceeding shall be brought
or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the
Indemnifying Party shall have the right to assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all fees and expenses incurred in connection with
defense thereof; provided, that the failure of any Indemnified Party to give
such notice shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent that it
shall be finally determined by a court of competent jurisdiction (which













determination
is not subject to appeal or further review) that such failure shall have
prejudiced the Indemnifying Party.


An Indemnified Party shall have the right to employ
separate counsel in any such Proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed
in writing to pay such fees and expenses; (2) the Indemnifying Party shall have
failed promptly to assume the defense of such Proceeding and to employ counsel
reasonably satisfactory to such Indemnified Party in any such Proceeding; or
(3) the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party and the Indemnifying Party, and such
Indemnified Party shall reasonably believe that a material conflict of interest
is likely to exist if the same counsel were to represent such Indemnified Party
and the Indemnifying Party (in which case, if such Indemnified Party notifies
the Indemnifying Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and the reasonable fees and expenses of one
separate counsel shall be at the expense of the Indemnifying Party).  The Indemnifying Party shall not be liable
for any settlement of any such Proceeding effected without its written consent,
which consent shall not be unreasonably withheld.  No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party
from all liability on claims that are the subject matter of such Proceeding.


(d) Contribution.
If a claim for indemnification under Section 5(a) or 5(b) is unavailable to an
Indemnified Party (by reason of public policy or otherwise), then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. 
The relative fault of such Indemnifying Party and Indemnified Party
shall be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact
or omission or alleged omission of a material fact, has been taken or made by,
or relates to information supplied by, such Indemnifying Party or Indemnified
Party, and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such action, statement or omission.  The amount paid or payable by a party as a
result of any Losses shall be deemed to include, subject to the limitations set
forth in this Agreement, any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with any Proceeding to the extent
such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such party in
accordance with its terms.


The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 5(d) were determined by pro
rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph.  Notwithstanding the
provisions of this Section 5(d), no Holder shall be required to contribute, in
the aggregate, any amount in excess of the amount by which the













proceeds
actually received by such Holder from the sale of the Registrable Securities
subject to the Proceeding exceeds the amount of any damages that such Holder
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, except in the case of fraud by such
Holder.


The indemnity and contribution agreements contained in
this Section are in addition to any liability that the Indemnifying Parties may
have to the Indemnified Parties.


6.                           Reports
Under Exchange Act.  With a view to
making available to the Holder the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell Registrable Shares of the Company to the public without
registration, the Company agrees to:


(a)   Make
and keep public information available, as those terms are used in SEC Rule 144,
at all times;


(b)   File
with the SEC in a timely manner all reports and other documents required of the
Company under the Securities Act, the Exchange Act and the rules and
regulations of the Trading Market;


(c)   Furnish
to any Holder, so long as the Holder owns any Registrable Shares, forthwith on
request, (i) a written statement by the Company that it has complied with the
reporting requirements of SEC Rule 144, the Securities Act and the Exchange
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 in availing any Holder of any
rule or regulation of the SEC that permits the selling of any such securities
without registration; and


(d)   Undertake
any additional actions reasonably necessary to maintain the availability of the
use of Rule 144 and any future rules adopted by the SEC permitting the resale
of the Registrable Securities.


7. Miscellaneous


(a)                      Remedies.  In the event of a breach by the Company or by
a Holder, of any of their obligations under this Agreement, each other Holder
or the Company, as the case may be, in addition to being entitled to exercise
all rights granted by law and under this Agreement, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement.  The Company and each Holder
agree that monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.













(b)                     Compliance. Each Holder,
severally and not jointly, covenants and agrees that it will comply with the
prospectus delivery requirements of the Securities Act as applicable to it in
connection with sales of Registrable Securities pursuant to the Registration
Statement.


(c)                      Discontinued Disposition. Each
Holder, severally and not jointly, agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(d), such Holder will
forthwith discontinue disposition of such Registrable Securities under a
Registration Statement until such Holder’s receipt of the copies of the
supplemented Prospectus and/or amended Registration Statement, or until it is
advised in writing (the “Advice”) by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement.  The Company will use its commercially
reasonable efforts to ensure that the use of the Prospectus may be resumed as
promptly as it practicable.


(d)                     Amendments and Waivers. The
provisions of this Agreement, including the provisions of this sentence, may
not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, unless the same shall be in
writing and signed by the Company and each Holder of the then outstanding
Registrable Securities.  Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders and that
does not directly or indirectly affect the rights of other Holders may be given
by Holders of all of the Registrable Securities to which such waiver or consent
relates; provided, however, that the provisions of this sentence
may not be amended, modified, or supplemented except in accordance with the provisions
of the immediately preceding sentence.


(e)                      Notices. Any and all notices or
other communications or deliveries required or permitted to be provided
hereunder shall be delivered as set forth in the Purchase Agreement.


(f)                        Successors and Assigns. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of each of the parties and shall inure to the benefit of each
Holder. The Company may not assign its rights or obligations hereunder without
the prior written consent of all of the Holders of the then-outstanding
Registrable Securities. Each Holder may assign their respective rights
hereunder in the manner and to the Persons as permitted under the Purchase
Agreement.


(g)                     No Inconsistent Agreements.
Neither the Company nor any of its 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, enter into any agreement with respect to its securities,
that would have the effect of impairing the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof.  


(h)                     Execution and Counterparts. This
Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Agreement. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid
binding obligation of the













party executing (or on whose behalf such signature is executed) the
same with the same force and effect as if such facsimile signature were the
original thereof.


(i)                         Governing Law.  All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined with the provisions of the Purchase
Agreement.


(j)                         Cumulative Remedies. The remedies
provided herein are cumulative and not exclusive of any remedies provided by
law.


(k)                      Severability. If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their commercially reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may
be hereafter declared invalid, illegal, void or unenforceable.


(l)                         Headings. The headings in this
Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof.


(m)                   Independent Nature of Holders’ Obligations
and Rights. The obligations of each Holder hereunder are several and
not joint with the obligations of any other Holder hereunder, and no Holder
shall be responsible in any way for the performance of the obligations of any
other Holder hereunder. Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Holder pursuant
hereto or thereto, shall be deemed to constitute the Holders as a partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that the Holders are in any way acting in concert with respect to
such obligations or the transactions contemplated by this Agreement. Each
Holder shall be entitled to protect and enforce its rights, including without
limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Holder to be joined as an additional party in any
proceeding for such purpose.


********************













IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.


	
  

  	
  CALLISTO PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  
	
  [SIGNATURE PAGE
  OF HOLDERS FOLLOWS]

  














[PURCHASER’S SIGNATURE PAGE TO REGISTRATION RIGHTS
AGREEMENT]


	
  

  	
  RAB
  Special Situations (Master) Fund Limited by

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  
	
   

  	
   

  
	
   

  	
  Authorised
  signatories for RAB Capital plc for and on

  
	
   

  	
  behalf of RAB
  Special Situations (Master) Fund Limited

  
	
   

  	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o RAB Capital plc

  
	
   

  	
   

  	
   1 Adam
  Street

  
	
   

  	
   

  	
   London
  WC2N 6LE

  
	
   

  	
   

  	
   United
  Kingdom

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile: 

  	
  (+44) 20 7389
  7057

  
				



 


[SIGNATURE PAGES CONTINUE]













[PURCHASER’S SIGNATURE PAGE TO REGISTRATION RIGHTS
AGREEMENT]


	
   

  	
  Absolute
  Octane Master Fund Limited

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  



 


[SIGNATURE PAGES CONTINUE]













[PURCHASER’S SIGNATURE PAGE TO REGISTRATION RIGHTS
AGREEMENT]


	
  Name of Investing Entity:

  	
   

  	
   

  
	
  Signature
  of Authorized Signatory of Investing Entity:

  	
   

  	
   

  
	
  Name of
  Authorized Signatory:

  	
   

  	
   

  
	
  Title of
  Authorized Signatory:

  	
   

  	
   

  
								



 


















ANNEX
A


Plan of Distribution


The
selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded
or in private transactions.  These
dispositions may be at fixed prices, at prevailing market prices at the time of
sale, at prices related to the prevailing market price, at varying prices determined
at the time of sale, or at negotiated prices.


The
selling stockholders may use any one or more of the following methods when
disposing of shares or interests therein:


·  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;


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


·  broker-dealers may agree with the selling
stockholders 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.


The
selling stockholders may, from time to time, pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if
they default in the performance of their secured obligations, the pledgees or
secured parties may offer and sell the shares of common stock, from time to
time, under this prospectus, or under an amendment to this prospectus under
Rule 424(b)(3) or other applicable provision of the Securities Act amending the
list of selling stockholders to include the pledgee, transferee or other
successors in interest as













selling
stockholders under this prospectus.  The
selling stockholders also may transfer the shares of common stock in other
circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus.


In
connection with the sale of our 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 sell shares
of our common stock short and deliver these securities to close out their short
positions, or loan or pledge the common stock to broker-dealers that in turn
may sell these securities.  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
aggregate proceeds to the selling stockholders from the sale of the common
stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any.  Each
of the selling stockholders reserves the right to accept and, together with
their agents from time to time, to reject, in whole or in part, any proposed
purchase of common stock to be made directly or through agents.  We will not receive any of the proceeds from
this offering. Upon any exercise of the warrants by payment of cash, however,
we will receive the exercise price of the warrants.


The
selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act of 1933,
provided that they meet the criteria and conform to the requirements of that
rule.


The
selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be “underwriters”
within the meaning of Section 2(11) of the Securities Act.  Any discounts, commissions, concessions or
profit they earn on any resale of the shares may be underwriting discounts and
commissions under the Securities Act. 
Selling stockholders who are “underwriters” within the meaning of
Section 2(11) of the Securities Act will be subject to the prospectus delivery
requirements of the Securities Act.


To
the extent required, the shares of our common stock to be sold, the names of
the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth
in an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.


In
order to comply with the securities laws of some states, if applicable, the
common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers.  In
addition, in some states the common stock may not be sold unless it has been
registered or qualified for sale or an exemption from registration or qualification
requirements is available and is complied with.













We
have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market
and to the activities of the selling stockholders and their affiliates.  In addition, we will make copies of this
prospectus (as it may be supplemented or amended from time to time) available
to the selling stockholders for the purpose of satisfying the prospectus
delivery requirements of the Securities Act. 
The selling stockholders may indemnify any broker-dealer that
participates in transactions involving the sale of the shares against certain
liabilities, including liabilities arising under the Securities Act.


We
have agreed to indemnify the selling stockholders against liabilities, including
liabilities under the Securities Act and state securities laws, relating to the
registration of the shares offered by this prospectus.


We
have agreed with the selling stockholders to keep the registration statement of
which this prospectus constitutes a part effective until the earlier (i) the
date when the selling stockholder may sell all securities registered under the
registration statement under Rule 144 without volume or other restrictions or
limits or (ii) the date the selling stockholders no longer own any of the
securities registered under the registration statement.













Annex B


CALLISTO
PHARMACEUTICALS, INC.


SELLING
STOCKHOLDERS’ QUESTIONNAIRE


The following
information is requested from you in connection with the preparation and filing
by Callisto Pharmaceuticals, Inc. (the “Company”) of a Registration Statement
on Form S-3 or other appropriate form (the “Registration Statement”) with the
Securities and Exchange Commission (the “SEC”) covering the sale of shares of
the Company’s common stock by certain stockholders.


We would
appreciate your answering all of the questions included in this questionnaire,
even though your answers may be in the negative, so that the Company will have
a record of your responses for use in connection with the preparation of the
Registration Statement.  It is
requested that you give careful attention to each question and that you
complete this questionnaire personally.


In order to assist
you in completing this questionnaire, certain terms used herein are defined in
the appendix which is attached to this questionnaire.  Each of such defined terms has been bolded and italicized for
identification.  The term “person,” as
used in this questionnaire, means any natural person, company, government or
political subdivision, agency or instrumentality of a government.


After you
have completed the following questionnaire, please send the completed
questionnaire by facsimile ((212) 930-9725) or overnight courier as soon as
possible to the attention of Jeffrey Fessler at Sichenzia Ross Friedman Ference
LLP, 1065 Avenue of the Americas, New York, New York 10018.


*********************


GENERAL
INFORMATION


1.             Please provide your full name and address or the full
name and address of the entity on whose behalf you are completing this
questionnaire.  The address may be a
business, mailing or residence address.


Name:


Address:


2.  Name the Control Person of your organization:













Securities Holdings


1.             Please fill in all blanks in the
following questions related to your beneficial ownership
of the Company’s common stock. 
Generally, the term “beneficial ownership”
refers to any direct or indirect interest in the securities which entitles you
to any of the rights or benefits of ownership, even though you may not be the
holder of record of the securities.  For
example, securities held in “street name” over which you exercise voting or
investment power would be considered beneficially owned
by you.  Other examples of indirect
ownership include ownership by a partnership in which you are a partner or by
an estate or trust of which you or any member of your immediate
family is a beneficiary. 
Ownership of securities held in the names of your spouse, minor children
or other relatives who live in the same household may be attributed to you.


If you have any
reason to believe that any interest in securities of the Company which you may
have, however remote, is a beneficial interest, please describe such
interest.  For purposes of responding to
this questionnaire, it is preferable to err on the side of inclusion rather
than exclusion.  Where the SEC’s
interpretation of beneficial ownership would
require disclosure of you interest or possible interest in certain securities
of the Company, and you believe that you do not actually possess the attributes
of beneficial ownership, an appropriate
response is to disclose the interest and at the same time disclaim beneficial ownership of the
securities.


Please indicate
the amount of common stock of the Company or any of its subsidiaries which you beneficially owned as of the date
hereof.


For each holding:


·                                          State
the nature of the holding (i.e., held in
your own name, jointly, as a trustee or beneficiary of a trust, as a custodian,
as an executor, in discretionary accounts, by your spouse or minor children, by
a partnership of which you are a partner, etc.), and


·                                          State
whether you are the beneficial owner by reason of
(i) sole voting power, (ii) shared voting power, (iii) sole investment power,
(iv) shared investment power, (v) the right to acquire stock within 60 days of
the end of the calendar year, and/or (vi) the right to acquire stock with the
purpose of changing or influencing control.


·                                          Indicate
in the Remarks column whether you have sole or shared voting or investment
power with respect to any such securities, and in what capacity (i.e., individual, general partner, trustee) you have such
power or powers.


·                                          If
you wish to disclaim beneficial ownership
of any shares listed, so indicate by writing the word “Disclaim” in the Remarks
column below; and you understand that such shares will be shown separately from
your beneficial holdings and an appropriate disclaimer set forth.













·                                          If
any of the shares listed are subject to any claim, encumbrance, pledge or lien,
so indicate in the Remarks column.













 


	
  Number of

  Shares

  	
   

  	
  Registered in

  the Name of

  	
   

  	
  Beneficially

  Owned by

  	
   

  	
  Remarks

  	
   

  	
  Shares Voted

  	
   

  	
  
 Shares to be Sold

  	
   

  
	
        

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


















2.                                       5%
Stockholders


To the best of my
knowledge, all persons (including myself and my associates
and including corporations, partnerships, trusts, associations and other such
groups) who beneficially own more than 5%
of any class of the Company’s stock are described below:


	
  Name of

  Beneficial

  Owner

  	
   

  	
  Class of Shares

  Beneficially

  Owned

  	
   

  	
  Holder of

  Voting or

  Investment Power

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  




 5
 









NO ADVERSE INTEREST


All interests I or
my associates have or will have that
are adverse to the Company interests in any pending or contemplated legal
proceeding or government investigation to which the Company is or will be a
party (or to which its property may be subject) are described below:



 6
 









Voting
Arrangement


All voting trusts
or similar agreements or arrangements
of which I have knowledge under which more than 5% of the Company’s outstanding
common stock, on an as converted basis, is held or to be held are described
below:


	
  Names and Addresses of Voting Trustees

  	
   

  	
  Voting Rights and Other Powers

  Under Trust, Agreement or Arrangement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 



 7
 









Change
in Control


All arrangements of which I have
knowledge, including any pledge by any person of securities of the Company, the
operations of which may at a subsequent date result in a change in control of the Company, are
described below:



 8
 









Transactions
with the Company


1.             Information regarding
all material interests of yours or your
associates in any actual or proposed transaction during the last three fiscal
years to which the Company was or is to be a party and that are identified
under “Securities Holdings” above) is provided below.  Further, no such transaction need be
described if:


(a)           the amount involved
(including all periodic installments in the case of any lease or other
agreement provided for periodic payments or installments and including the
value of all transactions In a series of similar transactions) does not exceed
$60,000;


(b)           the rates or charges
involved in the transaction are fixed by law or governmental authority or
determined by competitive bids;


(c)           the services involved
are as a bank depositary of funds, transfer agent, registrar, trustee under a
trust indenture or other similar service;


(d)           my interest arises
solely from my ownership of securities of the Company and I received no extra
or special benefit not shared on a pro rata basis by all other holders of
securities in the same class;


(e)           my interest in the
corporation that is a party to the transaction is solely as a director; or


(f)            my interest arose
solely as an officer and/or director of the Company (e.g., my compensation
arrangement with the Company).


Description:



 9
 









Affiliation
with Accountants or attorneys


Described below is
any interest, affiliation or connection you have with the firm of Sichenzia
Ross Friedman Ference LLP, BDO Seidman LLP or any other law firm or accounting
firm that has been retained by the Company during the last three fiscal years
or is proposed to be retained by the Company:



 10
 









Contracts
with the Company


Described below
are all contracts with the Company or in which the Company has a beneficial
interest, or to which the Company has succeeded by assumption or assignment, to
which you or any of your associates
is a party, which are to be performed in whole or in part at or after the date
of the proposed filing of the Registration Statement, or which were made not
more than two years prior thereto:



 11
 









NASD-RELATED QUESTIONS


(1)           Are you (i) a “member”
of the National Association of Securities Dealers, Inc. (“NASD”), (ii)
an “affiliate” of a member of the NASD, (iii) a “person associated with a
member” or “associated person of a member” of the NASD or (iv) associated with
an “underwriter or related person” with respect to the proposed initial public
offering for the Company?


Yes  o                  No  o


For the sole
purpose of this Question: (i) the NASD defines a “member” as being either any
broker or dealer admitted to membership in the NASD or any officer or partner
of such a member or the executive representative of such member or the
substitute for such representative; (ii) the term “affiliate” means a person
that directly, or indirectly through one or more intermediaries, controls, or
is controlled by, or is in common control with the person specified.  Persons who have acted or are acting on
behalf or for the benefit of a person include, but are not necessarily limited
to, directors, officers, employees, agents, consultants and sales
representatives; (iii) the NASD defines a “person associated with a member” or “associated
person of a member” as being every sole proprietor, partner, officer, director
or branch manager of any member, or any natural person occupying a similar
status or performing similar functions, or any natural person engaged in the
investment banking or securities business who is directly or indirectly
controlling or controlled by such member (for example, any employee), whether
or not any such person is registered or exempt from registration with the NASD;
and (iv) the term “underwriter or related person” includes, with respect to a
proposed offering, underwriters, underwriters’ counsel, financial consultants
and advisers, finders, members of the selling or distribution group, and any
and all other persons associated with or related to any such persons.


If yes,  kindly describe such relationship (whether
direct or indirect) and please respond to Questions (2) and (3) below; if no,
please proceed to Question (4).


(2)   Please
set forth information as to all purchases and acquisitions (including contracts
for purchase or acquisition) of securities of the Company by you, regardless of
the time acquired or the source from which derived:


	
  Seller or

  	
   

  	
  Amount and

  	
   

  	
  Price or Other

  	
   

  	
   

  	
   

  
	
  Prospective Seller

  	
   

  	
  Nature of Securities

  	
   

  	
  Consideration

  	
   

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


(3)   In
connection with your direct or indirect affiliation or association with a “member”
of the NASD as set forth above in Question (1), please furnish the identity of
such NASD member and any information, if known, as to whether such NASD member
intends to participate in any capacity in this proposed initial public
offering, including the details of such participation:



 12
 









(4)     Please
describe any underwriting compensation and arrangement or any dealings known to
you between any “underwriter or related person”, “member” of the NASD, “affiliate”
of a member of the NASD, “person associated with a member”, or “associated
person of a member” of the NASD on the one hand and the Company or controlling
shareholder thereof on the other hand, other than information relating to the
proposed initial public offering of the Company:


(5)     Please
set out below any information, if known, as to whether any “member” of the
NASD, any “underwriter or related person”, “affiliate” or a member of the NASD,
“person associated with a member” or “associated person of a member” of the
NASD may receive any portion of the net offering:



 13
 









I understand that
material misstatements or the omission of material facts in the Registration
Statement may give rise to civil and criminal liabilities to the Company, to
each officer and director of the Company signing the Registration Statement and
other persons signing the Registration Statement.  I will notify you and the Company of any
misstatement of a material fact in the Registration Statement or any amendment
thereto, and of the omission of any material fact necessary to make the
statements contained therein not misleading, as soon as practicable after a
copy of the Registration Statement or any such amendment has been provided to
me.


I confirm that the
foregoing statements are correct, to the best of my knowledge and belief.


	
  Dated:

  	
   

  	
  .

  	
   

  
	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Typed or
  Printed Name)

  




 14
 









Definitions


The term “arrangement” means any plan,
contract, authorization or understanding whether or not set forth in a formal
document.


The term “associate” as used throughout this
questionnaire, means (a) any corporation or organization (other than the
Company) of which I am an officer, director or partner or of which I am,
directly or indirectly, the beneficial owner of 5% or more of any class of
equity securities, (b) any trust or other estate in which I have a substantial
beneficial interest or as to which I serve as trustee or in a similar capacity,
(c) my spouse, (d) any relative of my spouse or any relative of mine who has
the same home as me or who is a director or officer or key executive of the
Company, (e) any partner, syndicate member or person with whom I have agreed to
act in concert with respect to the acquisition, holding, voting or disposition
of shares of the Company’s securities.


The term “beneficially owned” when used in
connection with the ownership of securities, means (a) any interest in a
security which entitles me to any of the rights or benefits of ownership even
though I may not be the owner of record or (b) securities owned by me directly
or indirectly, including those held by me for my own benefit (regardless of how
registered) and securities held by others for my benefit (regardless of how
registered), such as by custodians, brokers, nominees, pledgees, etc., and
including securities held by an estate or trust in which I have an interest as
legatee or beneficiary, securities owned by a partnership of which I am a
partner, securities held by a personal holding company of which I am a
stockholder, etc., and securities held in the name of my spouse, minor children
and any relative (sharing the same home). 
A “beneficial owner” of a security includes any person who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise has or shares:


(a)           voting power which
includes the power to vote, or to direct the voting of, such security; and/or


(b)           investment power which
includes the power to dispose, or to direct the disposition, of such security.


The term “control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract or otherwise.


The term “immediate family” means any relationship
by blood, marriage or adoption, not more remote than first cousin.


The term “material,” when used in this
questionnaire to qualify a requirement for the furnishing of information as to
any subject, limits the information required to those matters as to which an
average prudent investor ought reasonably to be informed before purchasing the
Common Stock of the Company.



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