ex10-21.htm


     

    
      

      

    

    Exhibit
10-21

    REGISTRATION
RIGHTS AGREEMENT

     

    This REGISTRATION RIGHTS AGREEMENT
(this “Agreement”),
dated as of April ___, 2010, is by and among China Armco Metals, Inc., a Nevada
corporation with offices located at One Waters Park Drive, Suite 98, San Mateo,
CA (the “Company”),
and each of the undersigned buyers (each, a “Buyer,” and collectively, the
“Buyers”).

     

    RECITALS

     

    A.           In
connection with the Securities Purchase Agreement by and among the parties
hereto, dated as of April 20, 2010 (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 each Buyer
(i) shares (the “Common
Shares”) of the Company’s common stock, $0.001 par value (the “Common Stock”) and (ii) the
Warrants (as defined in the Securities Purchase Agreement) which will be
exercisable to purchase Warrant Shares (as defined in the Securities Purchase
Agreement) in accordance with the terms of the Warrants.

     

    B.           To
induce the Buyers to consummate the transactions contemplated by 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
“1933 Act”), and
applicable state securities laws.

     

    AGREEMENT

     

    NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and each of the Buyers hereby agree as
follows:

     

    
      	
              1.  

            	
              Definitions.

            


    

     

    Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Securities Purchase Agreement.  As used in
this Agreement, the following terms shall have the following
meanings:

     

    (a) “Business Day” means any day
other than Saturday, Sunday or any other day on which commercial banks in New
York, New York are authorized or required by law to remain closed.

     

    (b) “Closing Date” shall have the
meaning set forth in the Securities Purchase Agreement.

     

    (c) “Effective Date” means the date
that the applicable Registration Statement has been declared effective by the
SEC.

     

    (d) “Effectiveness Deadline” means
(i) with respect to the initial Registration Statement required to be filed
pursuant to Section 2(a), the earlier of the (A)
90th
calendar day after the Closing Date (or the 120th
calendar day after the Closing Date in the event that such Registration
Statement is subject to review by the SEC) and (B) 5th
Business Day after the date the Company is notified (orally or in writing,
whichever is earlier) by the SEC that such Registration Statement will not be
reviewed or will not be subject to further review and (ii) with respect to any
additional Registration Statements that may be required to be filed by the
Company pursuant to this Agreement, the earlier of the (A) 90th
calendar day following the date on which the Company

     

    


    
      
        
           


        

        
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    was required to file such additional Registration Statement (or the 120th
calendar day after such date in the event that such Registration Statement is
subject to review by the SEC) and (B) 5th Business Day after the date the
Company is notified (orally or in writing, whichever is earlier) by the SEC that
such Registration Statement will not be reviewed or will not be subject to
further review.

     

    (e) “Filing Deadline” means (i)
with respect to the initial Registration Statement required to be filed pursuant
to Section 2(a), June 1, 2010 and (ii) with respect
to any additional Registration Statements that may be required to be filed by
the Company pursuant to this Agreement, the date on which the Company was
required to file such additional Registration Statement pursuant to the terms of
this Agreement.

     

    (f) “Investor” means a Buyer or any
transferee or assignee of any Registrable Securities or
Warrants, as applicable, to whom a Buyer assigns its rights under this Agreement
and who agrees to become bound by the provisions of this Agreement in accordance
with Section 9 and any transferee or assignee thereof to whom a
transferee or assignee of any Registrable Securities or Warrants, as applicable,
assigns its rights under this Agreement and who agrees to become bound by the
provisions of this Agreement in accordance with Section 9.

     

    (g) “Person” means an individual, a
limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization or a government or any department or
agency thereof.

     

    (h) “register,” “registered,” and “registration” refer to a
registration effected by preparing and filing one or more Registration
Statements in compliance with the 1933 Act and pursuant to Rule 415 and the
declaration of effectiveness of such Registration Statement(s) by the
SEC.

     

    (i) “Registrable Securities” means
(i) the Common Shares, (ii) the Warrant Shares and (iii) any capital stock of
the Company issued or issuable with respect to the Common Shares, the Warrant
Shares or the Warrants, including, without limitation, (1) as a result of any
stock split, stock dividend, recapitalization, exchange or similar event or
otherwise and (2) shares of capital stock of the Company into which the shares
of Common Stock are converted or exchanged and shares of capital stock of a
Successor Entity (as defined in the Warrants) into which the shares of Common
Stock are converted or exchanged, in each case, without regard to any
limitations on exercise of the Warrants.

     

    (j) “Registration Statement” means
a registration statement or registration statements of the Company filed under
the 1933 Act covering Registrable Securities.

     

    (k) “Required Holders” means the
holders of at least a majority of the Registrable Securities.

     

    (l) “Required Registration Amount”
means 100% of the sum of (i) the Common Shares issued and (ii) the maximum
number of Warrant Shares issued and issuable pursuant to the Warrants as of the
Trading Day (as defined in the Warrants) immediately preceding the applicable
date of determination (without taking into account any limitations on the
exercise of the Warrants set forth therein), all subject to adjustment as
provided in Section 2(d).

     

    (m) “Rule 144” means Rule 144
promulgated by the SEC under the 1933 Act, as such rule may be amended from time
to time, or any other similar or successor rule or regulation of the SEC that
may at any time permit the Investors to sell securities of the Company to the
public without registration.

     

    (n) “Rule 415” means Rule 415
promulgated by the SEC under the 1933 Act, as such rule may be amended from time
to time, or any other similar or successor rule or regulation of the SEC
providing for offering securities on a continuous or delayed basis.

     

    (o) “SEC” means the United States
Securities and Exchange Commission or any successor thereto.

     

    


    
      
        
           


        

        
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              2.  

            	
              Registration.

            


    

     

    (a) Mandatory
Registration.  The Company shall prepare and, as soon as
practicable, but in no event later than the Filing Deadline, file with the SEC
an initial Registration Statement on Form S-3 covering the resale of all of the
Registrable Securities, provided that such initial Registration Statement shall
register for resale at least the number of shares of Common Stock equal to the
Required Registration Amount as of the date such Registration Statement is
initially filed with the SEC, provided further that if Form S-3 is unavailable
for such a registration, the Company shall use such other form as is required by
Section 2(c). Such
initial Registration Statement, and each other Registration Statement required
to filed pursuant to the terms of this Agreement, shall contain (except if
otherwise directed by the Required Holders) the “Selling Stockholders”
and “Plan of
Distribution” sections in substantially the form attached hereto as Exhibit
B. The Company shall use its best efforts to have such initial
Registration Statement, and each other Registration Statement required to filed
pursuant to the terms of this Agreement, declared effective by the SEC as soon
as practicable, but in no event later than the applicable Effectiveness Deadline
for such Registration Statement.

     

    (b) [RESERVED]

     

    (c) Ineligibility to Use Form
S-3. In the event that Form S-3 is not available for the registration of
the resale of Registrable Securities hereunder, the Company shall (i) register
the resale of the Registrable Securities on another appropriate form reasonably
acceptable to the Required Holders and (ii) undertake to register the resale of
the Registrable Securities on Form S-3 as soon as such form is available,
provided that the Company shall maintain the effectiveness of all Registration
Statements then in effect until such time as a Registration Statement on Form
S-3 covering the resale of all the Registrable Securities has been declared
effective by the SEC.

     

    (d) Sufficient Number of Shares
Registered. In the event the number of shares available under any
Registration Statement is insufficient to cover all of the Registrable
Securities required to be covered by such Registration Statement, the Company
shall amend such Registration Statement (if permissible), or file with the SEC a
new Registration Statement (on the short form available therefor, if
applicable), or both, so as to cover at least the Required Registration Amount
as of the Trading Day immediately preceding the date of the filing of such
amendment or new Registration Statement, in each case, as soon as practicable,
but in any event not later than fifteen (15) days after the necessity therefor
arises (but taking account of any Staff position with respect to the date on
which the Staff will permit such amendment to the Registration Statement and/or
such new Registration Statement (as the case may be) to be filed with the SEC).
The Company shall use its best efforts to cause such amendment to such
Registration Statement and/or such new Registration Statement (as the case may
be) to become effective as soon as practicable following the filing thereof with
the SEC, but in no event later than the applicable Effectiveness Deadline for
such Registration Statement. For purposes of the foregoing provision, the number
of shares available under a Registration Statement shall be deemed “insufficient
to cover all of the Registrable Securities” if at any time the number of shares
of Common Stock available for resale under the applicable Registration Statement
is less than the product determined by multiplying (i) the Required Registration
Amount as of such time by (ii) 0.90. The calculation set forth in the foregoing
sentence shall be made without regard to any limitations on exercise of the
Warrants (and such calculation shall assume that the Warrants are then fully
exercisable for shares of Common Stock at the then-prevailing applicable
Exercise Price).

     

    (e) Effect of Failure to File
and Obtain and Maintain Effectiveness of any Registration Statement. If
(i) a Registration Statement covering the resale of all of the Registrable
Securities required to be covered thereby (disregarding any reduction pursuant
to Section 2(f)) and
required to be filed by the Company pursuant to this Agreement is (A) not filed
with the SEC on or before the Filing Deadline for such Registration Statement (a
“Filing Failure”) (it
being understood that if the Company files a Registration Statement without
affording each Investor the opportunity to review and comment on the same as
required by Section 3(c) hereof, the

     

    


    
      
        
           


        

        
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    Company shall be deemed to not have satisfied this clause (i)(A) and such
event shall be deemed to be a Filing Failure) or (B) not declared effective by
the SEC on or before the Effectiveness Deadline for such Registration Statement
(an “Effectiveness Failure”) (it being understood that if on the Business Day
immediately following the Effective Date for such Registration Statement the
Company shall not have filed a “final” prospectus for such Registration
Statement with the SEC under Rule 424(b) in accordance with Section 3(b) (whether or not such a prospectus is technically
required by such rule), the Company shall be deemed to not have satisfied this
clause (i)(B) and such event shall be deemed to be an Effectiveness Failure),
(ii) other than during an Allowable Grace Period (as defined below), on any day
after the Effective Date of a Registration Statement sales of all of the
Registrable Securities required to be included on such Registration Statement
(disregarding any reduction pursuant to Section 2(f)) cannot be made pursuant to such Registration
Statement (including, without limitation, because of a failure to keep such
Registration Statement effective, a failure to disclose such information as is
necessary for sales to be made pursuant to such Registration Statement, a
suspension or delisting of (or a failure to timely list) the shares of Common
Stock on the Principal Market (as defined in the Securities Purchase Agreement),
or a failure to register a sufficient number of shares of Common Stock or by
reason of a stop order) or the prospectus contained therein is not available for
use for any reason (a “Maintenance Failure”), or (iii) if a Registration
Statement is not effective for any reason or the prospectus contained therein is
not available for use for any reason, the Company fails to file with the SEC any
required reports under Section 13 or 15(d) of the 1934 Act such that it is not
in compliance with Rule 144(c)(1) (or Rule 144(i)(2), if applicable) (a “Current
Public Information Failure”) as a result of which any of the Investors are
unable to sell Registrable Securities without restriction under Rule 144
(including, without limitation, volume restrictions), then, as partial relief
for the damages to any holder by reason of any such delay in, or reduction of,
its ability to sell the underlying shares of Common Stock (which remedy shall
not be exclusive of any other remedies available at law or in equity), the
Company shall pay to each holder of Registrable Securities relating to such
Registration Statement an amount in cash equal to one (1%) percent of the
Purchase Price (as defined in the Securities Purchase Agreement) of such
Investor’s Registrable Securities (1) on the date of such Filing Failure,
Effectiveness Failure, Maintenance Failure or Current Public Information
Failure, as applicable, and (2) on every thirty (30) day anniversary of (I) a
Filing Failure until such Filing Failure is cured; (II) an Effectiveness Failure
until such Effectiveness Failure is cured; (III) a Maintenance Failure until
such Maintenance Failure is cured; and (IV) a Current Public Information Failure
until the earlier of (i) the date such Current Public Information Failure is
cured and (ii) such time that such public information is no longer required
pursuant to Rule 144 (in each case, pro rated for periods totaling less than
thirty (30) days). The payments to which a holder of Registrable Securities
shall be entitled pursuant to this Section 2(e) are referred to herein as “Registration Delay
Payments.” Following the initial Registration Delay Payment for any particular
event or failure (which shall be paid on the date of such event or failure, as
set forth above), without limiting the foregoing, if an event or failure giving
rise to the Registration Delay Payments is cured prior to any thirty (30) day
anniversary of such event or failure, then such Registration Delay Payment shall
be made on the third (3rd) Business Day after such cure. In the event the
Company fails to make Registration Delay Payments in a timely manner in
accordance with the foregoing, such Registration Delay Payments shall bear
interest at the rate of one and one-half percent (1.5%) per month (prorated for
partial months) until paid in full.  Notwithstanding anything herein
to the contrary, (i) in no event shall the Registration Delay Payments paid to
an Investor exceed, in the aggregate, more than 9% of the Purchase Price of such
Investor’s Registrable Securities on the Closing Date and (ii) in no event shall
Registration Delay Payments accrue during any periods that all Registrable
Securities may be resold by such Investor without restriction (including,
without limitation, volume limitations) pursuant to Rule 144 (taking account of
any Staff position with respect to “affiliate” status and assuming cashless
exercise of the Warrants) and without the need for current public information
required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable).

     

    (f) Offering.
Notwithstanding anything to the contrary contained in this Agreement, but
subject to the payment of the Registration Delay Payments pursuant to Section 2(e), in the event the
staff of the SEC (the “Staff”) or the SEC seeks to
characterize any offering pursuant to a Registration Statement filed
pursuant to this Agreement as constituting an offering of securities by, or
on behalf of, the Company, or in any other manner,

     

    
      
        
           


        

        
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    such that the Staff or the SEC do not permit such
Registration Statement to become effective and used for resales in a manner that
does not constitute such an offering and that permits the continuous resale at
the market by the Investors participating therein (or as otherwise may
be acceptable to each Investor) without being named therein as an “underwriter,”
then the Company shall reduce the number of shares to be included in such
Registration Statement by all Investors until such time as the Staff and
the SEC shall so permit such Registration Statement to become effective as
aforesaid. In making such reduction, the Company shall reduce the number of
shares to be included by all Investors on a pro rata basis (based upon the
number of Registrable Securities otherwise required to be included for each
Investor) unless the inclusion of shares by a particular Investor or a
particular set of Investors are resulting in the Staff or the SEC’s “by or
on behalf of the Company” offering position, in which event the shares held by
such Investor or set of Investors shall be the only shares subject to reduction
(and if by a set of Investors on a pro rata basis by such Investors or on such
other basis as would result in the exclusion of the least number of shares by
all such Investors).  In addition, in the event that the Staff or the SEC
requires any Investor seeking to sell securities under a Registration
Statement filed pursuant to this Agreement to be specifically identified as
an “underwriter” in order to permit such Registration Statement to
become effective, and such Investor does not consent to being so named as an
underwriter in such Registration Statement, then, in each such case, the
Company shall reduce the total number of Registrable Securities to be
registered on behalf of such Investor, until such time as the
Staff or the SEC does not require such identification or until such Investor
accepts such identification and the manner thereof. Any reduction pursuant
to this paragraph will first reduce all Registrable Securities other than
those issued pursuant to the Securities Purchase Agreement. In the event of
any reduction in Registrable Securities pursuant to this paragraph, an
affected Investor shall have the right to require, upon delivery of a written
request to the Company signed by such Investor, the Company to file a
registration statement within thirty (30) days of such request (subject to any
restrictions imposed by Rule 415 or required by the Staff or the SEC)
for resale by such Investor in a manner acceptable to such Investor, and the
Company shall following such request cause to be and keep effective such
registration statement in the same manner as otherwise contemplated in this
Agreement for registration statements hereunder, in each case until such
time as: (i) all Registrable Securities held by such Investor have been
registered and sold pursuant to an effective Registration Statement in a manner
acceptable to such Investor or (ii) all Registrable Securities may be
resold by such Investor without restriction (including, without limitation,
volume limitations) pursuant to Rule 144 (taking account of any Staff position
with respect to “affiliate” status and assuming cashless exercise of the
Warrants) and without the need for current public information required by Rule
144(c)(1) (or Rule 144(i)(2), if applicable) or (iii) such Investor agrees to be
named as an underwriter in any such Registration Statement in a manner
acceptable to such Investor as to all Registrable Securities held by such
Investor and that have not theretofore been included in a Registration Statement
under this Agreement (it being understood that the special demand right under
this sentence may be exercised by an Investor multiple times and with respect to
limited amounts of Registrable Securities in order to permit the resale thereof
by such Investor as contemplated above).

     

    (g) Piggyback
Registrations. Without limiting any obligation of the Company hereunder
or under the Securities Purchase Agreement, if there is not an effective
Registration Statement covering all of the Registrable Securities or the
prospectus contained therein is not available for use 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 1933 Act of
any of its equity securities (other than on Form S-4 or Form S-8 (each as
promulgated under the 1933 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 Company’s stock
option or other employee benefit plans), then the Company shall deliver to each
Investor a written notice of such determination and, if within fifteen (15) days
after the date of the delivery of such notice, any such Investor shall so
request in writing, the Company shall include in such registration statement all
or any part of such Registrable Securities such Investor requests to be
registered; provided, however, the Company shall not be required to register any
Registrable Securities pursuant to this Section 2(g) that are eligible for resale pursuant to Rule 144
without restriction (including, without limitation, volume restrictions) and
without the need for current public information required by Rule 144(c)(1) (or
Rule 144(i)(2), if applicable) or that are the subject of a then-effective
Registration Statement.

     

    
      
        
           


        

        
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    (h) Allocation of Registrable
Securities. The initial number of Registrable Securities included in any
Registration Statement and any increase in the number of Registrable Securities
included therein shall be allocated pro rata among the Investors based on the
number of Registrable Securities held by each Investor at the time such
Registration Statement covering such initial number of Registrable Securities or
increase thereof is declared effective by the SEC. In the event that an Investor
sells or otherwise transfers any of such Investor’s Registrable Securities, each
transferee or assignee (as the case may be) that becomes an Investor shall be
allocated a pro rata portion of the then-remaining number of Registrable
Securities included in such Registration Statement for such transferor or
assignee (as the case may be). Any shares of Common Stock included in a
Registration Statement and which remain allocated to any Person which ceases to
hold any Registrable Securities covered by such Registration Statement shall be
allocated to the remaining Investors, pro rata based on the number of
Registrable Securities then held by such Investors which are covered by such
Registration Statement.

     

    (i) No Inclusion of Other
Securities. In no event shall the Company include any securities other
than Registrable Securities on any Registration Statement without the prior
written consent of the Required Holders. Until the Applicable Date (as defined
in the Securities Purchase Agreement), the Company shall not enter into any
agreement providing any registration rights to any of its security
holders.

     

    
      	
              3.  

            	
              Related
      Obligations.

            


    

     

    The
Company shall use its best efforts to effect the registration of the Registrable
Securities in accordance with the intended method of disposition thereof, and,
pursuant thereto, the Company shall have the following obligations:

     

    (a) The
Company shall promptly prepare and file with the SEC a Registration Statement
with respect to all the Registrable Securities (but in no event later than the
applicable Filing Deadline) and use its best efforts to cause such Registration
Statement to become effective as soon as practicable after such filing (but in
no event later than the Effectiveness Deadline). Subject to Allowable Grace
Periods, the Company shall keep each Registration Statement effective (and the
prospectus contained therein available for use) pursuant to Rule 415 for resales
by the Investors on a delayed or continuous basis at then-prevailing market
prices (and not fixed prices) at all times until the earlier of (i) the date as
of which all of the Investors may sell all of the Registrable Securities
required to be covered by such Registration Statement (disregarding any
reduction pursuant to Section 2(f)) without
restriction pursuant to Rule 144 (including, without limitation, volume
restrictions) and without the need for current public information required by
Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or (ii) the date on which the
Investors shall have sold all of the Registrable Securities covered by such
Registration Statement (the “Registration Period”).
Notwithstanding anything to the contrary contained in this Agreement, the
Company shall ensure that, when filed and at all times while effective, each
Registration Statement (including, without limitation, all amendments and
supplements thereto) and the prospectus (including, without limitation, all
amendments and supplements thereto) used in connection with such Registration
Statement (1) shall not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein, or necessary to make the
statements therein (in the case of prospectuses, in the light of the
circumstances in which they were made) not misleading and (2) will disclose
(whether directly or through incorporation by reference to other SEC filings to
the extent permitted) all material information regarding the Company and its
securities. The Company shall submit to the SEC, within one (1) Business Day
after the later of the date that (i) the Company learns that no review of a
particular Registration Statement will be made by the Staff or that the Staff
has no further comments on a particular Registration Statement (as the case may
be) and (ii) the consent of Legal Counsel is obtained pursuant to Section 3(c) (which consent shall
be immediately sought), a request for acceleration of effectiveness of such
Registration Statement to a time and date not later than forty-eight (48) hours
after the submission of such request.

     

    


    
      
        
           


        

        
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(b) Subject to Section 3(r) of this Agreement, the Company shall prepare and
file with the SEC such amendments (including, without limitation, post-effective
amendments) and supplements to each Registration Statement and the prospectus
used in connection with each such Registration Statement, which prospectus is to
be filed pursuant to Rule 424 promulgated under the 1933 Act, as may be
necessary to keep each such Registration Statement effective at all times during
the Registration Period for such Registration Statement, and, during such
period, comply with the provisions of the 1933 Act with respect to the
disposition of all Registrable Securities of the Company required to be 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; provided, however, by 8:30 a.m. (New York time) on the
Business Day immediately following each Effective Date, the Company shall file
with the SEC in accordance with Rule 424(b) under the 1933 Act the final
prospectus to be used in connection with sales pursuant to the applicable
Registration Statement (whether or not such a prospectus is technically required
by such rule). In the case of amendments and supplements to any Registration
Statement which are required to be filed pursuant to this Agreement (including,
without limitation, pursuant to this Section 3(b)) by reason of the Company filing a report on Form
10-Q or Form 10-K or any analogous report under the Securities Exchange Act of
1934, as amended (the “1934
Act”), the Company shall have incorporated such report by reference into
such Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC on the same day on which the 1934 Act report is filed
which created the requirement for the Company to amend or supplement such
Registration Statement.

     

    (c) The
Company shall (A) permit Legal Counsel and legal counsel for each other Investor
to review and comment upon (i) each Registration Statement at least five (5)
Business Days prior to its filing with the SEC and (ii) all amendments and
supplements to each Registration Statement (including, without limitation, the
prospectus contained therein) (except for Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or successor
reports) within a reasonable number of days prior to their filing with the SEC,
and (B) not file any Registration Statement or amendment or supplement thereto
in a form to which Legal Counsel or any legal counsel for any other Investor
reasonably objects. The Company shall not submit a request for acceleration of
the effectiveness of a Registration Statement or any amendment or supplement
thereto or to any prospectus contained therein without the prior consent of
Legal Counsel, which consent shall not be unreasonably withheld. The Company
shall promptly furnish to Legal Counsel and legal counsel for each other
Investor, without charge, (i) copies of any correspondence from the SEC or the
Staff to the Company or its representatives relating to each Registration
Statement, provided that such correspondence shall not contain any material,
non-public information regarding the Company or any of its Subsidiaries (as
defined in the Securities Purchase Agreement), (ii) after the same is
prepared and filed with the SEC, one (1) copy of each Registration Statement and
any amendment(s) and supplement(s) thereto, including, without limitation,
financial statements and schedules, all documents incorporated therein by
reference, if requested by an Investor, and all exhibits and (iii) upon the
effectiveness of each Registration Statement, one (1) copy of the prospectus
included in such Registration Statement and all amendments and supplements
thereto. The Company shall reasonably cooperate with Legal Counsel and legal
counsel for each other Investor in performing the Company’s obligations pursuant
to this Section 3.

     

    (d) The
Company shall promptly furnish to each Investor whose Registrable Securities are
included in any Registration Statement, without charge, (i) after the same is
prepared and filed with the SEC, at least one (1) copy of each Registration
Statement and any amendment(s) and supplement(s) thereto, including, without
limitation, financial statements and schedules, all documents incorporated
therein by reference, if requested by an Investor, all exhibits and each
preliminary prospectus, (ii) upon the effectiveness of each Registration
Statement, ten (10) copies of the prospectus included in such Registration
Statement and all amendments and supplements thereto (or such other number of
copies as such Investor may reasonably request from time to time) and (iii) such
other documents, including, without limitation, copies of any preliminary or
final prospectus, as such Investor may reasonably request from time to time in
order to facilitate the disposition of the Registrable Securities owned by such
Investor.

     

    


    
      
        
           


        

        
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(e) The Company shall use its best efforts to (i) register and qualify, unless
an exemption from registration and qualification applies, the resale by
Investors of the Registrable Securities covered by a Registration Statement
under such other securities or “blue sky” laws of all applicable jurisdictions
in the United States, (ii) prepare and file in those jurisdictions, such
amendments (including, without limitation, 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, the
Company shall not be required in connection therewith or as a condition thereto
to (x) qualify to do business in any jurisdiction where it would not otherwise
be required to qualify but for this Section 3(e), (y) subject itself to general taxation in any
such jurisdiction, or (z) file a general consent to service of process in any
such jurisdiction. The Company shall promptly notify Legal Counsel, legal
counsel for each other Investor and each Investor who holds Registrable
Securities of the receipt by the Company of any notification with respect to the
suspension of the registration or qualification of any of the Registrable
Securities for sale under the securities or “blue sky” laws of any jurisdiction
in the United States or its receipt of actual notice of the initiation or
threatening of any proceeding for such purpose.

     

    (f) The
Company shall notify Legal Counsel, legal counsel for each other Investor and
each Investor in writing of the happening of any event, as promptly as
practicable after becoming aware of such event, as a result of which the
prospectus included in a Registration Statement, as then in effect, includes an
untrue statement of a material fact or omission to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(provided that in no event shall such notice contain any material, non-public
information regarding the Company or any of its Subsidiaries), and, subject to
Section 3(r), promptly
prepare a supplement or amendment to such Registration Statement and such
prospectus contained therein to correct such untrue statement or omission and
deliver ten (10) copies of such supplement or amendment to Legal Counsel, legal
counsel for each other Investor and each Investor (or such other number of
copies as Legal Counsel, legal counsel for each other Investor or such Investor
may reasonably request). The Company shall also promptly notify Legal Counsel,
legal counsel for each other Investor and each Investor in writing (i) when a
prospectus or any prospectus supplement or post-effective amendment has been
filed, when a Registration Statement or any post-effective amendment has become
effective (notification of such effectiveness shall be delivered to Legal
Counsel, legal counsel for each other Investor and each Investor by facsimile or
e-mail on the same day of such effectiveness and by overnight mail), and when
the Company receives written notice from the SEC that a Registration Statement
or any post-effective amendment will be reviewed by the SEC, (ii) of any request
by the SEC for amendments or supplements to a Registration Statement or related
prospectus or related information, (iii) of the Company’s reasonable
determination that a post-effective amendment to a Registration Statement would
be appropriate; and (iv) of the receipt of any request by the SEC or any other
federal or state governmental authority for any additional information relating
to the Registration Statement or any amendment or supplement thereto or any
related prospectus. The Company shall respond as promptly as practicable to any
comments received from the SEC with respect to each Registration Statement or
any amendment thereto (it being understood and agreed that the Company’s
response to any such comments shall be delivered to the SEC no later than five
(5) days after the receipt thereof).

     

    (g) The
Company shall (i) use its best efforts to prevent the issuance of any stop order
or other suspension of effectiveness of each Registration Statement or the use
of any prospectus contained therein, or the suspension of the qualification, or
the loss of an exemption from qualification, of any of the Registrable
Securities for sale in any jurisdiction and, if such an order or suspension is
issued, to obtain the withdrawal of such order or suspension at the earliest
possible moment and (ii) notify Legal Counsel, legal counsel for each other
Investor and each Investor who holds Registrable Securities 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.

     

    


    
      
        
           


        

        
          - 8
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(h) If any Investor may be required under applicable securities law to be
described in any Registration Statement as an underwriter and such Investor
consents to so being named an underwriter, at the request of any Investor, the
Company shall furnish to such Investor, on the date of the effectiveness of such
Registration Statement and thereafter from time to time on such dates as an
Investor may reasonably request (i) a letter, dated such date, from the
Company’s independent certified public accountants in form and substance as is
customarily given by independent certified public accountants to underwriters in
an underwritten public offering, addressed to the Investors, and (ii) an
opinion, dated as of such date, of counsel representing the Company for purposes
of such Registration Statement, in form, scope and substance as is customarily
given in an underwritten public offering, addressed to the
Investors.

     

    (i) If any
Investor may be required under applicable securities law to be described in any
Registration Statement as an underwriter and such Investor consents to so being
named an underwriter, upon the written request of such Investor, the Company
shall make available for inspection by (i) such Investor, (ii) legal counsel for
such Investor and (iii) one (1) firm of accountants or other agents retained by
such Investor (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, each Inspector shall agree in writing to
hold in strict confidence and not to make any disclosure (except to such
Investor) or use of any Record or other information which the Company’s board of
directors determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (1) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in any
Registration Statement or is otherwise required under the 1933 Act, (2) 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 (3) the
information in such Records has been made generally available to the public
other than by disclosure in violation of this Agreement or any other Transaction
Document (as defined in the Securities Purchase Agreement). Such Investor agrees
that it shall, upon learning that disclosure of such Records is sought in or by
a court or governmental body of competent jurisdiction or through other means,
give prompt notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, the Records deemed confidential. Nothing herein (or in any other
confidentiality agreement between the Company and such Investor, if any) shall
be deemed to limit any Investor’s ability to sell Registrable Securities in a
manner which is otherwise consistent with applicable laws and
regulations.

     

    (j) The
Company shall hold in confidence and not make any disclosure of information
concerning an Investor provided to the Company unless (i) disclosure of such
information is necessary to comply with federal or state securities laws, (ii)
the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement or is otherwise required
to be disclosed in such Registration Statement pursuant to the 1933 Act, (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
Transaction Document. The Company agrees that it shall, upon learning that
disclosure of such information concerning an Investor is sought in or by a court
or governmental body of competent jurisdiction or through other means, give
prompt written notice to such Investor and allow such Investor, at such
Investor’s expense, to undertake appropriate action to prevent disclosure of, or
to obtain a protective order for, such information.

     

    (k) Without
limiting any obligation of the Company under the Securities Purchase Agreement,
the Company shall use its best efforts either to (i) cause all of the
Registrable Securities covered by each Registration Statement to be listed on
each securities exchange on which securities of the same class or series issued
by the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange, (ii) secure
designation and quotation of all of the Registrable Securities

     

    


    
      
        
           


        

        
          - 9
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    covered
by each Registration Statement on the OTC Bulletin Board, or (iii) if, despite
the Company’s best efforts to satisfy the preceding clauses (i) or (ii) the
Company is unsuccessful in satisfying the preceding clauses (i) or (ii), without
limiting the generality of the foregoing, to use its best efforts to arrange for
at least two market makers to register with the Financial Industry Regulatory
Authority (“FINRA”) as
such with respect to such Registrable Securities. In addition, the Company shall
cooperate with each Investor and any broker or dealer through which any such
Investor proposes to sell its Registrable Securities in effecting a filing with
FINRA pursuant to FINRA Rule 5110 as requested by such Investor. The Company
shall pay all fees and expenses in connection with satisfying its obligations
under this Section 3(k).

     

          
(l) The
Company shall cooperate with the Investors who hold Registrable Securities being
offered and, to the extent applicable, facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legend) representing the
Registrable Securities to be offered pursuant to a Registration Statement and
enable such certificates to be in such denominations or amounts (as the case may
be) as the Investors may reasonably request from time to time and registered in
such names as the Investors may request.

     

    (m) If
requested by an Investor, the Company shall as soon as practicable after receipt
of notice from such Investor and subject to Section 3(r) hereof, (i)
incorporate in a prospectus supplement or post-effective amendment such
information as an Investor reasonably requests to be included therein relating
to the sale and distribution of Registrable Securities, including, without
limitation, information with respect to the number of Registrable Securities
being offered or sold, the purchase price being paid therefor and any other
terms of the offering of the Registrable Securities to be sold in such offering;
(ii) make all required filings of such prospectus supplement or post-effective
amendment after being notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment; and (iii) supplement or make
amendments to any Registration Statement or prospectus contained therein if
reasonably requested by an Investor holding any Registrable
Securities.

     

    (n) The
Company shall use its best efforts to cause the Registrable Securities covered
by a 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.

     

    (o) The
Company shall make generally available to its security holders as soon as
practical, but not later than ninety (90) days after the close of the period
covered thereby, an earnings statement (in form complying with, and in the
manner provided by, the provisions of Rule 158 under the 1933 Act) covering a
twelve-month period beginning not later than the first day of the Company’s
fiscal quarter next following the applicable Effective Date of each Registration
Statement.

     

    (p) 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.

     

    (q) Within
one (1) Business Day 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 Investors 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
A.

     

    (r) Notwithstanding
anything to the contrary herein (but subject to the last sentence of this
Section 3(r)), at any
time after the Effective Date of a particular Registration Statement, the
Company may delay the disclosure of material, non-public information concerning
the Company or any of its Subsidiaries the disclosure of which at the time is
not, in the good faith opinion of the board of directors of the Company, in the
best interest of the Company and, in the opinion of counsel to the Company,
otherwise required (a “Grace
Period”), provided that the Company shall promptly notify the Investors
in writing of the (i) existence of material, non-public information giving rise
to a Grace Period (provided that in each such notice the Company shall
not

     

    


    
      
        
           


        

        
          - 10
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    disclose the content of such material, non-public information to any of the
Investors) and the date on which such Grace Period will begin and (ii) date
on which such Grace Period ends, provided further that (I) no Grace Period shall
exceed ten (10) consecutive days and during any three hundred sixty five (365)
day period all such Grace Periods shall not exceed an aggregate of thirty (30)
days, (II) the first day of any Grace Period must be at least five (5) Trading
Days after the last day of any prior Grace Period and (III) no Grace Period may
exist during the sixty (60) Trading Day period immediately following the
Effective Date of such Registration Statement (provided that such sixty (60)
Trading Day period shall be extended by the number of Trading Days during such
period and any extension thereof contemplated by this proviso during which such
Registration Statement is not effective or the prospectus contained therein is
not available for use) (each, an “Allowable Grace Period”). For purposes of
determining the length of a Grace Period above, such Grace Period shall begin on
and include the date the Investors receive the notice referred to in clause (i)
above and shall end on and include the later of the date the Investors receive
the notice referred to in clause (ii) above and the date referred to in such
notice. The provisions of Section 3(g) hereof shall not be applicable during the period
of any Allowable Grace Period. Upon expiration of each Grace Period, the Company
shall again be bound by the first sentence of Section 3(f) with respect to the
information giving rise thereto unless such material, non-public information is
no longer applicable. Notwithstanding anything to the contrary contained in this
Section 3(r), the
Company shall cause its transfer agent to deliver unlegended shares of Common
Stock to a transferee of an Investor in accordance with the terms of the
Securities Purchase Agreement in connection with any sale of Registrable
Securities with respect to which such Investor has entered into a contract for
sale, and delivered a copy of the prospectus included as part of the particular
Registration Statement to the extent applicable, prior to such Investor’s
receipt of the notice of a Grace Period and for which the Investor has not yet
settled.

     

    (s) The
Company shall use its best efforts to maintain eligibility for use of Form S-3
(or any successor form thereto) for the registration of the resale of all the
Registrable Securities.

     

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

     

    
      	
              4.  

            	
              Obligations of the
      Investors.

            


    

     

    (a) At least
five (5) Business Days prior to the first anticipated filing date of each
Registration Statement, the Company shall notify each Investor in writing of the
information the Company requires from each such Investor with respect to such
Registration Statement. It shall be a condition precedent to the obligations of
the Company to complete the registration pursuant to this Agreement with respect
to the Registrable Securities of a particular Investor that such Investor shall
furnish to the Company such information regarding itself, the Registrable
Securities held by it and the intended method of disposition of the Registrable
Securities held by it, as shall be reasonably required to effect and maintain
the effectiveness of the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company may
reasonably request.

     

    (b) Each
Investor, by such Investor’s acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of each Registration Statement hereunder, unless
such Investor has notified the Company in writing of such Investor’s election to
exclude all of such Investor’s Registrable Securities from such Registration
Statement.

     

    (c) Each
Investor agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(g) or the first sentence of 3(f), such Investor will immediately discontinue
disposition of Registrable Securities pursuant to any Registration Statement(s)
covering such Registrable Securities until such Investor’s receipt of the copies
of the supplemented or amended prospectus contemplated by Section 3(g) or the first sentence of Section 3(f) or receipt of notice that no supplement or
amendment is required. Notwithstanding anything to the contrary in this Section
4(c), the Company
shall cause

     

    


    
      
        
           


        

        
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    its transfer agent to deliver unlegended shares of Common Stock to a
transferee of an Investor in accordance with the terms of the Securities
Purchase Agreement in connection with any sale of Registrable Securities with
respect to which such Investor has entered into a contract for sale prior to the
Investor’s receipt of a notice from the Company of the happening of any event of
the kind described in Section 3(g) or the first
sentence of Section 3(f) and for which such
Investor has not yet settled.

     

    (d) Each
Investor covenants and agrees that it will comply with the prospectus delivery
requirements of the 1933 Act as applicable to it in connection with sales of
Registrable Securities pursuant to a Registration Statement.

     

    
      	
              5.  

            	
              Expenses of
      Registration.

            


    

     

          
All reasonable expenses, other than underwriting discounts and commissions,
incurred in connection with registrations, filings or qualifications pursuant to
Sections 2 and 3,
including, without limitation, all registration, listing and qualifications
fees, printers and accounting fees, FINRA filing fees (if any) and fees and
disbursements of counsel for the Company shall be paid by the
Company.

     

    
      	
              6.  

            	
              Indemnification.

            


    

     

    (a) In the
event any Registrable Securities are included in any Registration Statement
under this Agreement, to the fullest extent permitted by law, the Company will,
and hereby does, indemnify, hold harmless and defend each Investor and each of
its directors, officers, shareholders, members, partners, employees, agents,
advisors, representatives (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding the lack of such title or
any other title) and each Person, if any, who controls such Investor within the
meaning of the 1933 Act or the 1934 Act and each of the directors, officers,
shareholders, members, partners, employees, agents, advisors, representatives
(and any other Persons with a functionally equivalent role of a Person holding
such titles notwithstanding the lack of such title or any other title) of such
controlling Persons (each, an “Indemnified Person”), against
any losses, obligations, claims, damages, liabilities, contingencies, judgments,
fines, penalties, charges, costs (including, without limitation, court costs,
reasonable attorneys’ fees and costs of defense and investigation), 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
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading or (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement (the matters in the foregoing
clauses (i) through (iii) being, collectively, “Violations”). Subject to
Section 6(c), the
Company shall reimburse the Indemnified Persons, promptly as such expenses are
incurred and are due and payable, for any legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such
Claim. Notwithstanding anything to

     

    


    
      
        
           


        

        
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    the contrary contained herein, the indemnification agreement contained in
this Section 6(a): (i)
shall not apply to a Claim by an Indemnified Person arising out of or based upon
a Violation which occurs in reliance upon and in conformity with information
furnished in writing to the Company by such Indemnified Person for such
Indemnified Person expressly for use in connection with the preparation of such
Registration Statement or any such amendment thereof or supplement thereto and
(ii) shall not be available to a particular Investor to the extent such Claim is
based on a failure of such Investor to deliver or to cause to be delivered the
prospectus made available by the Company (to the extent applicable), including,
without limitation, a corrected prospectus, if such prospectus or corrected
prospectus was timely made available by the Company pursuant to Section 3(d) and then only if, and to the extent that,
following the receipt of the corrected prospectus no grounds for such Claim
would have existed; and (iii) shall not apply to amounts paid in settlement of
any Claim if such settlement is effected without the prior written consent of
the Company, which consent shall not be unreasonably withheld or delayed. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Indemnified Person and shall survive the transfer of
any of the Registrable Securities by any of the Investors pursuant to Section 9.

     

    (b) In
connection with any Registration Statement in which an Investor is
participating, such Investor 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 who signs the Registration
Statement and each Person, if any, who controls the Company within the meaning
of the 1933 Act or the 1934 Act (each, an “Indemnified Party”), against
any Claim or Indemnified Damages to which any of them may become subject, under
the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified
Damages arise out of or are based upon any Violation, in each case, to the
extent, and only to the extent, that such Violation occurs in reliance upon and
in conformity with written information furnished to the Company by such Investor
expressly for use in connection with such Registration Statement; and, subject
to Section 6(c) and
the below provisos in this Section 6(b), such Investor will reimburse an Indemnified Party
any legal or other expenses reasonably incurred by such Indemnified Party in
connection with investigating or defending any such Claim; provided, however,
the indemnity agreement contained in this Section 6(b) and the agreement
with respect to contribution contained in Section 7
shall not apply to amounts paid in settlement of any Claim if such settlement is
effected without the prior written consent of such Investor, which consent shall
not be unreasonably withheld or delayed, provided further that such Investor
shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified
Damages as does not exceed the net proceeds to such Investor as a result of the
applicable 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 any of the Registrable Securities by any of the
Investors pursuant to Section 9.

     

    (c) Promptly
after receipt by an Indemnified Person or Indemnified Party (as the case may be)
under this Section 6 of notice of the commencement
of any action or proceeding (including, without limitation, any governmental
action or proceeding) involving a Claim, such Indemnified Person or Indemnified
Party (as the case may be) 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, an Indemnified Person or Indemnified Party (as the case may be) shall
have the right to retain its own counsel with the fees and expenses of such
counsel to be paid by the indemnifying party if: (i) the indemnifying party has
agreed in writing to pay such fees and expenses; (ii) the indemnifying party
shall have failed promptly to assume the defense of such Claim and to employ
counsel reasonably satisfactory to such Indemnified Person or Indemnified Party
(as the case may be) in any such Claim; or (iii) the named parties to any such
Claim (including, without limitation, any impleaded parties) include both such
Indemnified Person or Indemnified Party (as the case may be) and the
indemnifying party, and such Indemnified Person or such

     

    


    
      
        
           


        

        
          - 13
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    Indemnified Party (as the case may be) shall have been advised by counsel
that a conflict of interest is likely to exist if the same counsel were to
represent such Indemnified Person or such Indemnified Party and the indemnifying
party (in which case, if such Indemnified Person or such Indemnified Party (as
the case may be) notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, then the
indemnifying party shall not have the right to assume the defense thereof and
such counsel shall be at the expense of the Indemnifying Party, provided further
that in the case of clause (iii) above the indemnifying party shall not be
responsible for the reasonable fees and expenses of more than one (1) separate
legal counsel for such Indemnified Person or Indemnified Party (as the case may
be). The Indemnified Party or Indemnified Person (as the case may be) shall
reasonably cooperate 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 (as the case may be) which relates
to such action or Claim. The indemnifying party shall keep the Indemnified Party
or Indemnified Person (as the case may be) reasonably 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, 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 (as the case may
be), 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 (as
the case may be) of a release from all liability in respect to such Claim or
litigation, and such settlement shall not include any admission as to fault on
the part of the Indemnified Party. Following indemnification as provided for
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person (as the case may be) 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 (as the case may be) under this Section
6, except to the extent that the indemnifying party
is materially and adversely prejudiced in its ability to defend such
action.

     

    (d) No Person
involved in the sale of Registrable Securities who is guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) in
connection with such sale shall be entitled to indemnification from any Person
involved in such sale of Registrable Securities who is not guilty of fraudulent
misrepresentation.

     

    (e) 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.

     

    (f) The
indemnity and contribution 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: (i) no contribution shall be made under circumstances where the maker
would not have been liable for indemnification under the fault standards set
forth in Section 6 of this Agreement, (ii) no
Person involved in the sale of Registrable Securities which Person is guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) in connection with such sale shall be entitled to contribution from any
Person involved in such sale of

     

    


    
      
        
           


        

        
          - 14
-

          
            

          

        

        
           


        

      

    

    


    Registrable Securities who was not guilty of fraudulent misrepresentation;
and (iii) contribution by any seller of Registrable Securities shall be limited
in amount to the amount of net proceeds received by such seller from the
applicable sale of such Registrable Securities pursuant to such Registration
Statement. Notwithstanding the provisions of this Section 7, no Investor shall be required to contribute, in the
aggregate, any amount in excess of the amount by which the net proceeds actually
received by such Investor from the applicable sale of the Registrable Securities
subject to the Claim exceeds the amount of any damages that such Investor has
otherwise been required to pay, or would otherwise be required to pay under
Section 6(b), by reason of such untrue or alleged
untrue statement or omission or alleged omission.

     

    
      	
              8.  

            	
              Reports Under the 1934
      Act.

            


    

     

    With a
view to making available to the Investors the benefits of Rule 144, the Company
agrees to:

     

    (a) make and
keep public information available, as those terms are understood and defined in
Rule 144;

     

    (b) file with
the SEC in a timely manner all reports and other documents required of the
Company under the 1933 Act and the 1934 Act so long as the Company remains
subject to such requirements (it being understood and agreed that nothing herein
shall limit any obligations of the Company under the Securities Purchase
Agreement) and the filing of such reports and other documents is required for
the applicable provisions of Rule 144; and

     

    (c) furnish
to each Investor so long as such Investor owns Registrable Securities, promptly
upon request, (i) a written statement by the Company, if true, that it has
complied with the reporting, submission and posting requirements of Rule 144 and
the 1934 Act, (ii) a copy of the most recent annual or quarterly report of the
Company and such other reports and documents so filed by the Company with the
SEC if such reports are not publicly available via EDGAR, and (iii) such other
information as may be reasonably requested to permit the Investors to sell such
securities pursuant to Rule 144 without registration.

     

    
      	
              9.  

            	
              Assignment of
      Registration Rights.

            


    

     

    All or
any portion of the rights under this Agreement shall be automatically assignable
by each Investor to any transferee or assignee (as the case may be) of all or
any portion of such Investor’s Registrable Securities or Warrants if: (i) such
Investor agrees in writing with such transferee or assignee (as the case may be)
to assign all or any portion of such rights, and a copy of such agreement is
furnished to the Company within a reasonable time after such transfer or
assignment (as the case may be); (ii) the Company is, within a reasonable time
after such transfer or assignment (as the case may be), furnished with written
notice of (a) the name and address of such transferee or assignee (as the case
may be), and (b) the securities with respect to which such registration rights
are being transferred or assigned (as the case may be); (iii) immediately
following such transfer or assignment (as the case may be) the further
disposition of such securities by such transferee or assignee (as the case may
be) is restricted under the 1933 Act or applicable state securities laws if so
required; (iv) at or before the time the Company receives the written notice
contemplated by clause (ii) of this sentence such transferee or assignee (as the
case may be) agrees in writing with the Company to be bound by all of the
provisions contained herein; (v) such transfer or assignment (as the case may
be) shall have been made in accordance with the applicable requirements of the
Securities Purchase Agreement and the Warrants (as the case may be); and (vi)
such transfer or assignment (as the case may be) shall have been conducted in
accordance with all applicable federal and state securities laws.

    

      
        
           


        

        
          - 15
-

          
            

          

        

        
           


        

      

    

     

    
      	
              10.  

            	
              Amendment of
      Registration Rights.

            


    

     

    Provisions
of this Agreement may be amended only with the written consent of the Company
and the Required
Holders. Any amendment effected in accordance with this Section 10 shall be binding upon each Investor and the
Company. No waiver shall be effective unless it is in writing and signed by an
authorized representative of the waiving party. No consideration shall be
offered or paid to any Person to amend or consent to a waiver or modification of
any provision of this Agreement unless the same consideration also is offered to
all of the parties to this Agreement.

     

    
      	
              11.  

            	
              Miscellaneous.

            


    

     

    (a) Solely
for purposes of this Agreement, a Person is deemed to be a holder of Registrable
Securities whenever such Person owns, or is deemed to own, of record such
Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more Persons with respect to the same
Registrable Securities, the Company shall act upon the basis of instructions,
notice or election received from such record owner of such Registrable
Securities.

     

    (b) Any
notices, consents, waivers or other communications required or permitted to be
given under the terms of this Agreement must be in writing and will be deemed to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending party);
(iii) with respect to Section 3(c), by electronic
mail (provided confirmation of transmission is electronically generated and kept
on file by the sending party); or (iv) one (1) Business Day after deposit with a
nationally recognized overnight delivery service with next day delivery
specified, 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:

     

    One Waters Park Drive

    Suite 98

    San Mateo, California
94403

    Telephone:  (650)
212-7620

    Telephone:
(650) 212-7620

    Facsimile:
(650) 212 7630

    Attention:  Raymond
Yong Xia

    e-mail:
Raymond@armcometals.com

    


    With a
copy (for informational purposes only) to:

     

    James M.
Schneider, Esq.

    Schneider
Weinberger &
Beilly LLP

    2200
Corporate Blvd. N.W., Suite 210

    Boca
Raton, FL 33431

    Tel:
(561) 362-9595

    Fax:
(561) 362-9612

    e-mail:  jim@swblaw.net

    


    If to the
Transfer Agent:

     

    Action
Stock Transfer Corp.

    7069
Highland Drive, Suite 300

    Salt Lake
City, Utah 84121

    Telephone:  (801)
274-1088

    Facsimile:  (801)
274-1099

    Attention:  Justeene
Blankenship

    e-mail:
justblank2000@yahoo.com

    

      
        
           


        

        
          - 16
-

          
            

          

        

        
           


        

      

    

     

    If to a
Buyer, to its address and facsimile number set forth on the Schedule of Buyers
attached to the Securities Purchase Agreement, 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 or electronic mail transmission containing the
time, date, recipient facsimile number or electronic mail address and an image
of the first page of such transmission or (C) provided by a courier or overnight
courier service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.

     

    (c) Failure
of any party to exercise any right or remedy under this Agreement or otherwise,
or delay by a party in exercising such right or remedy, shall not operate as a
waiver thereof. The Company and each Investor acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that each party hereto shall be
entitled to an injunction or injunctions to prevent or cure breaches of the
provisions of this Agreement by any other party hereto and to enforce
specifically the terms and provisions hereof (without the necessity of showing
economic loss and without any bond or other security being required), this being
in addition to any other remedy to which any party may be entitled by law or
equity.

     

    (d) The
parties hereby agree that all questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
New York, New York, 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 TO, 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.

    

      
        
           


        

        
          - 17
-

          
            

          

        

        
           


        

      

    

     

    (e) This
Agreement, the other Transaction Documents, the schedules and exhibits attached
hereto and thereto and the instruments referenced herein and therein constitute
the entire agreement among the parties hereto and thereto solely with respect to
the subject matter hereof and thereof. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
therein. This Agreement, the other Transaction Documents, the schedules and
exhibits attached hereto and thereto and the instruments referenced herein and
therein supersede all prior agreements and understandings among the parties
hereto solely with respect to the subject matter hereof and thereof; provided,
however, nothing contained in this Agreement or any other Transaction Document
shall (or shall be deemed to) (i) have any effect on any agreements any Investor
has entered into with the Company or any of its Subsidiaries prior to the date
hereof with respect to any prior investment made by such Investor in the
Company, (ii) waive, alter, modify or amend in any respect any obligations of
the Company or any of its Subsidiaries or any rights of or benefits to any
Investor or any other Person in any agreement entered into prior to the date
hereof between or among the Company and/or any of its Subsidiaries and any
Investor and all such agreements shall continue in full force and effect or
(iii) limit any obligations of the Company under any of the other Transaction
Documents.

     

    (f) Subject
to compliance with Section 9 (if applicable), this
Agreement shall inure to the benefit of and be binding upon the permitted
successors and assigns of each of the parties hereto. This Agreement is not for
the benefit of, nor may any provision hereof be enforced by, any Person, other
than the parties hereto, their respective permitted successors and assigns and
the Persons referred to in Sections 6 and 7 hereof.

     

    (g) The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof. Unless the context clearly
indicates otherwise, each pronoun herein shall be deemed to include the
masculine, feminine, neuter, singular and plural forms thereof. The terms
“including,” “includes,” “include” and words of like import shall be construed
broadly as if followed by the words “without limitation.” The terms “herein,”
“hereunder,” “hereof” and words of like import refer to this entire Agreement
instead of just the provision in which they are found.

     

    (h) This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party. In
the event that any signature is delivered by facsimile transmission or by an
e-mail which contains a portable document format (.pdf) file of an executed
signature page, such signature page shall create a valid and binding obligation
of the party executing (or on whose behalf such signature is executed) with the
same force and effect as if such signature page were an original
thereof.

     

    (i) Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents as any other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.

     

    (j) 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. Notwithstanding anything to the contrary set forth
in Section 10, terms used in this Agreement but
defined in the other Transaction Documents shall have the meanings ascribed to
such terms on the Closing Date in such other Transaction Documents unless
otherwise consented to in writing by each Investor.

     

    (k) All
consents and other determinations required to be made by the Investors pursuant
to this Agreement shall be made, unless otherwise specified in this Agreement,
by the Required Holders.

     

    (l) The
obligations of each Investor under this Agreement and the other Transaction
Documents are several and not joint with the obligations of any other Investor,
and no Investor shall be responsible in any way for the performance of the
obligations of any other Investor under this Agreement or any other Transaction
Document. Nothing contained herein or in any other Transaction Document, and no
action taken by any Investor pursuant hereto or thereto, shall be deemed to
constitute the Investors as, and the Company acknowledges that the Investors do
not so constitute, a partnership, an association, a joint venture or any other
kind of group or entity, or create a presumption that the Investors are in any
way acting in concert or as a group or entity with respect to such obligations
or the transactions contemplated by the Transaction Documents or any matters,
and the Company acknowledges that the Investors are not acting in concert or as
a group, and the Company shall not assert any such claim, with respect to such
obligations or the transactions contemplated by this Agreement or any of the
other the Transaction Documents. Each Investor shall be entitled to
independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of any other Transaction Documents,
and it shall not be necessary for any other Investor to be joined as an
additional party in any proceeding for such purpose. The use of a single
agreement with respect to the obligations of the Company contained herein was
solely in the control of the Company, not the action or decision of any
Investor, and was done solely for the convenience of the Company and not because
it was required or requested to do so by any Investor. It is expressly
understood and agreed that each provision contained in this Agreement and in
each other Transaction Document is between the Company and an Investor, solely,
and not between the Company and the Investors collectively and not between and
among Investors.

     

    [signature pages
follow]

     

    
      
        
           


        

        
          - 18
-

          
            

          

        

        
           


        

      

    

    


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

     

    


    
      	
              COMPANY:

               

            
	
              CHINA
      ARMCO METALS, INC.

              By:

              Name:

              Title:

               

            


    

    


    


    
      
        
           


        

        
          - 19
-

          
            

          

        

        
           


        

      

    

    


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

     

    


    Name of
Buyer: ________________________________________________________

    Signature of Authorized Signatory of
Buyer: _________________________________

    Name of
Authorized Signatory:
_______________________________________________

    Title of
Authorized Signatory:
________________________________________________

    


    


    
      
        
           


        

        
          - 20
-

          
            

          

        

        
           


        

      

    

    


    EXHIBIT
A

     

    FORM OF NOTICE OF
EFFECTIVENESS

     

    OF REGISTRATION
STATEMENT

     

    ______________________

     

    ______________________

     

    ______________________

     

    Attention:  _____________

     

    Re:           China
Armco Metals, Inc.

     

    Ladies
and Gentlemen:

     

     

    [We
are][I am] counsel to China Armco Metals, Inc., a Nevada 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 “Holders”) pursuant to which
the Company issued to the Holders shares of the Company’s common stock, $0.001
par value per share (the “Common Stock”) (the “Common Shares”) and warrants
exercisable for shares of Common Stock (the “Warrants”). Pursuant to the
Securities Purchase Agreement, the Company also has entered into a Registration
Rights Agreement with the Holders (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), including the common Shares and the shares of Common Stock issuable
upon exercise of the Warrants, under the Securities Act of 1933, as amended (the
“1933 Act”). In
connection with the Company’s obligations under the Registration Rights
Agreement, on ____________ ___, 20__, the Company filed a Registration Statement
on Form S-3 (File No. 333-_____________) (the “Registration Statement”) with
the Securities and Exchange Commission (the “SEC”) relating to the
Registrable Securities which names each of the Holders as a selling stockholder
thereunder.

     

    In
connection with the foregoing, [we][I] advise you that a member of the SEC’s
staff has advised [us][me] by telephone that the SEC has entered an order
declaring the Registration Statement effective under the 1933 Act at [ENTER TIME
OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS] and [we][I] 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 1933 Act pursuant to
the Registration Statement.

     

    This
letter shall serve as our standing opinion to you that the Common Shares and the
shares of Common Stock underlying the Warrants are freely transferable by the
Holders pursuant to the Registration Statement. You need not require further
letters from us to effect any future legend-free issuance or reissuance of such
shares of Common Stock to the Holders.

     

     

    Very
truly yours,

     

    [ISSUER’S
COUNSEL]

     

    By:_____________________

    


     

    CC:           [LIST NAMES OF
HOLDERS]

     

    


    
      
        
           


        

        
          - 21
-

          
            

          

        

        
           


        

      

    

    


    EXHIBIT
B

    


    SELLING
STOCKHOLDERS

     

    The
shares of common stock being offered by the selling stockholders are those
issuable to the selling stockholders upon conversion of the notes and exercise
of the warrants. For additional information regarding the issuance of the notes
and the warrants, see “Private Placement of Notes and 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 for the
ownership of the notes and 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 (as determined under Section 13(d) of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder) of
the shares of common stock held by each of the selling stockholders. The second
column lists the number of shares of common stock beneficially owned by the
selling stockholders, based on their respective ownership of shares of common
stock, notes and warrants, as of ________, 2010, assuming conversion of the
notes and exercise of the warrants held by each such selling stockholder on that
date but taking account of any limitations on conversion and exercise set forth
therein.

     

    The third
column lists the shares of common stock being offered by this prospectus by the
selling stockholders and does not take in account any limitations on (i)
conversion of the notes set forth therein or (ii) exercise of the warrants set
forth therein.

     

    In
accordance with the terms of a registration rights agreement with the holders of
the notes and the warrants, this prospectus generally covers the resale of 100%
of the sum of (i) the maximum number of shares of common stock issuable upon
conversion of the notes and (ii) the maximum number of shares of common stock
issuable upon exercise of the warrants, in each case, determined as if the
outstanding notes and warrants were converted or exercised (as the case may be)
in full (without regard to any limitations on conversion or exercise contained
therein) as of the trading day immediately preceding the date this registration
statement was initially filed with the SEC. Because the conversion price of the
notes and 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 notes and the warrants, a selling stockholder may not convert the
notes or exercise the warrants to the extent (but only to the extent) such
selling stockholder or any of its affiliates would beneficially own a number of
shares of our common stock which would exceed 4.9%. The number of shares in the
second column reflects these limitations. The selling stockholders may sell all,
some or none of their shares in this offering.  See “Plan of
Distribution.”

     

    


    
      
        
           


        

        
          - 22
-

          
            

          

        

        
           


        

      

    

    


    
      	
               

               

              Name of Selling Stockholder

            	
              Number of Shares of Common Stock Owned Prior to
      Offering

            	
              Maximum Number of  Shares of Common
      Stock to be Sold Pursuant to this Prospectus

            	
              Number of  Shares of Common Stock of
      Owned After Offering

            


    

     

    
      
        
           


        

        
          - 23
-

          
            

          

        

        
           


        

      

    

    


    PLAN
OF DISTRIBUTION

     

    We are
registering the shares of common stock issuable upon conversion of the notes and
exercise of the warrants to permit the resale of these shares of common stock by
the holders of the notes and warrants from time to time after the date of this
prospectus. We will not receive any of the proceeds from the sale by the selling
stockholders of the shares of common stock.  We will bear all fees and
expenses incident to our obligation to register the shares of common
stock.

     

    The
selling stockholders may sell all or a portion of the shares of common stock
held by them and offered hereby from time to time directly or through one or
more underwriters, broker-dealers or agents. If the shares of common stock are
sold through underwriters or broker-dealers, the selling stockholders will be
responsible for underwriting discounts or commissions or agent’s commissions.
The shares of common stock may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of the sale, at varying prices
determined at the time of sale or at negotiated prices. These sales may be
effected in transactions, which may involve crosses or block transactions,
pursuant to one or more of the following methods:

     

    
      	
              ·  

            	
              on
      any national securities exchange or quotation service on which the
      securities may be listed or quoted at the time of
  sale;

            


    

     

    
      	
              ·  

            	
              in
      the over-the-counter market;

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

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

            


    

     

    
      	
              ·  

            	
              privately
      negotiated transactions;

            


    

     

    
      	
              ·  

            	
              short
      sales made after the date the Registration Statement is declared effective
      by the SEC;

            


    

     

    
      	
              ·  

            	
              agreements
      entered into between broker-dealers and a selling securityholder 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.

            


    

    
       

      
        
           


        

        
          - 24
-

          
            

          

        

        
           


        

      

    

     

    The
selling stockholders may also sell shares of common stock under Rule 144
promulgated under the Securities Act of 1933, as amended, if available, rather
than under this prospectus. In addition, the selling stockholders may transfer
the shares of common stock by other means not described in this prospectus. If
the selling stockholders effect such transactions by selling shares of common
stock to or through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts,
concessions or commissions from the selling stockholders or commissions from
purchasers of the shares of common stock for whom they may act as agent or to
whom they may sell as principal (which discounts, concessions or commissions as
to particular underwriters, broker-dealers or agents may be in excess of those
customary in the types of transactions involved). In connection with sales of
the shares of common stock or otherwise, the selling stockholders may enter into
hedging transactions with broker-dealers, which may in turn engage in short
sales of the shares of common stock in the course of hedging in positions they
assume. The selling stockholders may also sell shares of common stock short and
deliver shares of common stock covered by this prospectus to close out short
positions and to return borrowed shares in connection with such short sales. The
selling stockholders may also loan or pledge shares of common stock to
broker-dealers that in turn may sell such shares.

     

    The
selling stockholders may pledge or grant a security interest in some or all of
the notes, warrants or 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 pursuant to this
prospectus or any amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act amending, if necessary, 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 and donate the shares of common stock in other circumstances
in which case the transferees, donees, pledgees or other successors in interest
will be the selling beneficial owners for purposes of this
prospectus.

     

    To the
extent required by the Securities Act and the rules and regulations thereunder,
the selling stockholders and any broker-dealer participating in the distribution
of the shares of common stock may be deemed to be “underwriters” within the
meaning of the Securities Act, and any commission paid, or any discounts or
concessions allowed to, any such broker-dealer may be deemed to be underwriting
commissions or discounts under the Securities Act. At the time a particular
offering of the shares of common stock is made, a prospectus supplement, if
required, will be distributed, which will set forth the aggregate amount of
shares of common stock being offered and the terms of the offering, including
the name or names of any broker-dealers or agents, any discounts, commissions
and other terms constituting compensation from the selling stockholders and any
discounts, commissions or concessions allowed or re-allowed or paid to
broker-dealers.

     

    Under the
securities laws of some states, the shares of common stock may be sold in such
states only through registered or licensed brokers or dealers. In addition, in
some states the shares of common stock may not be sold unless such shares have
been registered or qualified for sale in such state or an exemption from
registration or qualification is available and is complied with.

     

    There can
be no assurance that any selling stockholder will sell any or all of the shares
of common stock registered pursuant to the registration statement, of which this
prospectus forms a part.

     

    The
selling stockholders and any other person participating in such distribution
will be subject to applicable provisions of the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder, including, without
limitation, to the extent applicable, Regulation M of the Exchange Act, which
may limit the timing of purchases and sales of any of the shares of common stock
by the selling stockholders and any other participating person. To the extent
applicable, Regulation M may also restrict the ability of any person engaged in
the distribution of the shares of common stock to engage in market-making
activities with respect to the shares of common stock. All of the foregoing may
affect the marketability of the shares of common stock and the ability of any
person or entity to engage in market-making activities with respect to the
shares of common stock.

    
       

      
        
           


        

        
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    We will
pay all expenses of the registration of the shares of common stock pursuant to
the registration rights agreement, estimated to be
$[     ] in total, including, without limitation,
Securities and Exchange Commission filing fees and expenses of compliance with
state securities or “blue sky” laws; provided, however, a selling stockholder
will pay all underwriting discounts and selling commissions, if any. We will
indemnify the selling stockholders against liabilities, including some
liabilities under the Securities Act in accordance with the registration rights
agreements or the selling stockholders will be entitled to contribution. We may
be indemnified by the selling stockholders against civil liabilities, including
liabilities under the Securities Act that may arise from any written information
furnished to us by the selling stockholder specifically for use in this
prospectus, in accordance with the related registration rights agreements or we
may be entitled to contribution.

    


          Once
sold under the registration statement, of which this prospectus forms a part,
the shares of common stock will be freely tradable in the hands of persons other
than our affiliates.

    


    
      
        
           


        

        
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