Exhibit 10.2


 


REGISTRATION RIGHTS AGREEMENT


 


This REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
is made and entered into as of May 22, 2009 by and among American Defense
Systems, Inc., a Delaware corporation (the “Company”),
and the Holders named in that certain Settlement Agreement, Waiver and
Amendment of even date herewith by and among the Company and the Holders (the “Settlement Agreement”). Capitalized terms used herein have
the respective meanings ascribed thereto in the Settlement Agreement unless
otherwise defined herein.


 


The parties
hereby agree as follows:


 


1.                                       Certain
Definitions.


 


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


 


“Common Stock” shall mean the Company’s common stock, par
value $0.001 per share, and any securities into which such shares may
hereinafter be reclassified.


 


“Investors” shall mean the Holders identified in the
Settlement Agreement and any permitted transferee of any Investor who is a
subsequent holder of any Registrable Securities.


 


“Prospectus” shall mean (i) the prospectus included in
any Registration Statement, as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by such Registration Statement and by all other
amendments and supplements to the prospectus, including post-effective
amendments and all material incorporated by reference in such prospectus, and (ii) any
“free writing prospectus” as defined in Rule 405 under the 1933 Act.


 


“Register,” “registered” and
“registration” refer to a registration
made by preparing and filing a Registration Statement or similar document in
compliance with the 1933 Act (as defined below), and the declaration or
ordering of effectiveness of such Registration Statement or document.


 


“Registrable Securities” shall mean (i) the Settlement
Shares and (ii) any other securities issued or issuable with respect to or
in exchange for Registrable Securities; provided, that, a security shall cease
to be a Registrable Security upon (A) sale pursuant to a Registration
Statement or Rule 144 under the 1933 Act, or (B) such security
becoming eligible for sale by the Investors pursuant to Rule 144.


 


“Registration Statement” shall mean any registration
statement of the Company filed under the 1933 Act that covers the resale of any
of the Registrable Securities pursuant to the provisions of this Agreement,
amendments and supplements to such Registration Statement, including
post-effective amendments, and all exhibits and all material incorporated by
reference in such Registration Statement.


 

















 


“Required Investors” means the Investors holding a majority
of the Registrable Securities.


 


“SEC” means the U.S. Securities and Exchange Commission.


 


“1933 Act” means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.


 


“1934 Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.


 


2.                                       Registration.


 


(a)                                  Registration
Statement.  Within ten days following
the Effective Date, the Company shall prepare and file with the SEC one
Registration Statement on Form S-3 (or, if Form S-3 is not then
available to the Company, on such form of registration statement as is then
available to effect a registration for resale of the Registrable Securities),
covering the resale of the Registrable Securities.  Subject to any SEC comments, such
Registration Statement shall include the plan of distribution attached hereto
as Exhibit A; provided, however, that no Investor shall be named as
an “underwriter” in the Registration Statement without the Investor’s prior
written consent. Such Registration Statement also shall cover, to the extent
allowable under the 1933 Act and the rules promulgated thereunder
(including Rule 416), such indeterminate number of additional shares of
Common Stock resulting from stock splits, stock dividends or similar
transactions with respect to the Registrable Securities.  The Registration Statement (and each
amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section 3(c) to
the Investors and one counsel to the Investors prior to its filing or other
submission.


 


(b)                                 Expenses.
The Company will pay all expenses associated with the registration pursuant
hereto, including filing and printing fees, the Company’s counsel and
accounting fees and expenses, costs associated with clearing the Registrable
Securities for sale under applicable state securities laws and listing fees,
and fees and expenses of one counsel to the Investors (up to a maximum of
$10,000), but excluding any other fees or expenses incurred by the Investors
and any discounts, commissions, fees of underwriters, selling brokers, dealer
managers or similar securities industry professionals with respect to the
Registrable Securities being sold.


 


(c)                                  Effectiveness.


 


(i)                                     The
Company shall use best efforts to have the Registration Statement declared
effective as soon as practicable after the filing thereof. The Company shall
notify the Investors by facsimile or e-mail as promptly as practicable, and in
any event within 24 hours, after the Registration Statement is declared
effective and shall simultaneously provide the Investors with copies of any
related Prospectus to be used in connection with the sale or other disposition
of the securities covered thereby.


 


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(ii)                                  For
not more than 20 consecutive days or for a total of not more than 60 days in
any 12 month period, the Company may suspend the use of any Prospectus included
in any Registration Statement in the event that the Company determines in good
faith that such suspension is necessary to (A) delay the disclosure of
material non-public information concerning the Company, the disclosure of which
at the time is not, in the good faith opinion of the Company, in the best
interests of the Company or (B) amend or supplement the affected
Registration Statement or the related Prospectus so that such Registration
Statement or Prospectus shall not include an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the case of the Prospectus in
light of the circumstances under which they were made, not misleading (an “Allowed Delay”); provided, however, that the Company shall
promptly (a) notify each Investor in writing of the commencement of and
the reasons for an Allowed Delay, but shall not (without the prior written
consent of an Investor) disclose to such Investor any material non-public
information giving rise to an Allowed Delay and (b) advise the Investors
in writing to cease all sales under the Registration Statement until the end of
the Allowed Delay.


 


(d)                                 Rule 415;
Cutbacks. If at any time the SEC takes the position that the offering of
some or all of the Registrable Securities in a Registration Statement is not
eligible to be made on a delayed or continuous basis under the provisions of Rule 415
under the 1933 Act or requires any Investor to be named as an “underwriter”,
the Company shall use its best efforts to persuade the SEC that the offering
contemplated by the Registration Statement is a valid secondary offering and
not an offering “by or on behalf of the issuer” as defined in Rule 415 and
that none of the Investors is an “underwriter”. The Investors shall have the
right to participate or have their counsel participate in any meetings or
discussions with the SEC regarding the SEC’s position and to comment or have
their counsel comment on any written submission made to the SEC with respect
thereto. No such written submission shall be made to the SEC to which the
Investors’ counsel reasonably objects. In the event that, despite the Company’s
best efforts and compliance with the terms of this Section 2(d), the SEC
refuses to alter its position, the Company shall (i) remove from the
Registration Statement such portion of the Registrable Securities (the “Cut Back Shares”) and/or (ii) agree to such
restrictions and limitations on the registration and resale of the Registrable
Securities as the SEC may require to assure the Company’s compliance with the
requirements of Rule 415; provided, however, that the Company shall not
agree to name any Investor as an “underwriter” in such Registration Statement
without the prior written consent of such Investor (collectively, the “SEC Restrictions”). Any cut-back imposed on the Investors
pursuant to this Section 2(d) shall be allocated among the Investors
on a pro rata basis, unless the SEC Restrictions otherwise require or provide.


 


3.                                       Company
Obligations. The Company will use best efforts to effect the registration
of the Registrable Securities in accordance with the terms hereof, and pursuant
thereto the Company will, as expeditiously as possible:


 


(a)                                  use
best efforts to cause such Registration Statement to remain continuously
effective for a period commencing on the date on which the Registration
Statement is declared effective pursuant to Section 2(c)(i), and
terminating upon the earlier of (i) the date on which all Registrable
Securities covered by such Registration Statement as amended from


 


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time to time,
have been sold, and (ii) the date on which all Registrable Securities
covered by such Registration Statement may be sold pursuant to Rule 144
(the “Effectiveness Period”);


 


(b)                                 prepare
and file with the SEC such amendments and post-effective amendments to the
Registration Statement and the Prospectus as may be necessary to keep the
Registration Statement effective for the Effectiveness Period and to comply
with the provisions of the 1933 Act and the 1934 Act with respect to the
distribution of all of the Registrable Securities covered thereby;


 


(c)                                  provide
copies to and permit counsel designated by the Investors to review each
Registration Statement and all amendments and supplements thereto no fewer than
two days prior to their filing with the SEC and not file any document to which
such counsel reasonably objects;


 


(d)                                 furnish
to the Investors and their legal counsel (i) promptly after the same is
prepared and publicly distributed, filed with the SEC, or received by the
Company (but not later than two Business Days after the filing date, receipt
date or sending date, as the case may be) one copy of any Registration
Statement and any amendment thereto, each preliminary prospectus and Prospectus
and each amendment or supplement thereto, and each letter written by or on
behalf of the Company to the SEC or the staff of the SEC, and each item of correspondence
from the SEC or the staff of the SEC, in each case relating to such
Registration Statement (other than any portion of any thereof which contains
information for which the Company has sought confidential treatment), and (ii) such
number of copies of a Prospectus, including a preliminary prospectus, and all
amendments and supplements thereto and such other documents as each Investor
may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such Investor that are covered by the related
Registration Statement;


 


(e)                                  (i) promptly
notify the Investors of the issuance of any stop order or other suspension of
the effectiveness of any Registration Statement and (ii) use best efforts
to (A) prevent the issuance of any stop order or other suspension of
effectiveness and, (B) if such order is issued, obtain the withdrawal of
any such order at the earliest possible moment;


 


(f)                                    use
best efforts to register or qualify or cooperate with the Investors and their
counsel in connection with the registration or qualification of such
Registrable Securities for offer and sale under the securities or blue sky laws
of such jurisdictions requested by the Investors and do any and all other
commercially reasonable acts or things necessary or advisable to enable the
distribution in such jurisdictions of the Registrable Securities covered by the
Registration Statement; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to (i) qualify
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(f), (ii) subject itself to general
taxation in any jurisdiction where it would not otherwise be so subject but for
this Section 3(f), or (iii) file a general consent to service of
process in any such jurisdiction;


 


(g)                                 use
best efforts to cause all Registrable Securities covered by a Registration
Statement to be listed on each securities exchange, interdealer quotation
system or other market on which similar securities issued by the Company are
then listed;


 


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(h)                                 immediately
notify the Investors, at any time prior to the end of the Effectiveness Period,
upon discovery that the Prospectus includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing, and promptly prepare, file with the SEC and furnish
to such holder a supplement to or an amendment of such Prospectus as may be
necessary so that such Prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing; and


 


(i)                                     otherwise
use best efforts during the Effectiveness Period to comply with all applicable rules and
regulations of the SEC under the 1933 Act and the 1934 Act with respect to the
Registration Statement, including, without limitation, Rule 172 under the
1933 Act, file any final Prospectus, including any supplement or amendment
thereof, with the SEC pursuant to Rule 424 under the 1933 Act, promptly
inform the Investors in writing if, at any time during the Effectiveness
Period, the Company does not satisfy the conditions specified in Rule 172
and, as a result thereof, the Investors are required to deliver a Prospectus in
connection with any disposition of Registrable Securities and take such other
actions as may be reasonably necessary to facilitate the registration of the
Registrable Securities hereunder; and make available to its security holders,
as soon as reasonably practicable, but not later than the Availability Date (as
defined below), an earnings statement covering a period of at least twelve (12)
months, beginning after the effective date of each Registration Statement,
which earnings statement shall satisfy the provisions of Section 11(a) of
the 1933 Act, including Rule 158 promulgated thereunder (for the purpose
of this subsection 3(i), “Availability Date”
means the 45th day following the end of the fourth fiscal quarter that includes
the effective date of such Registration Statement, except that, if such fourth
fiscal quarter is the last quarter of the Company’s fiscal year, “Availability Date” means the 90th day after the end of such
fourth fiscal quarter).


 


4.                                       Obligations
of the Investors.


 


(a)                                  Each
Investor shall furnish in writing 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 the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company may
reasonably request. At least five Business Days prior to the first anticipated
filing date of any Registration Statement, the Company shall notify each
Investor of the information the Company requires from such Investor if such
Investor elects to have any of the Registrable Securities included in the
Registration Statement. An Investor shall provide such information to the
Company at least two Business Days prior to the first anticipated filing date
of such Registration Statement if such Investor elects to have any of the
Registrable Securities included in the Registration Statement.


 


(b)                                 Each
Investor, by its 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 a Registration Statement hereunder, unless such
Investor has notified the Company in writing of its election to exclude all of
its Registrable Securities from such Registration Statement.


 


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(c)                                  Each
Investor agrees that, upon receipt of any notice from the Company of either (i) the
commencement of an Allowed Delay pursuant to Section 2(c)(ii) or (ii) the
happening of an event pursuant to Section 3(h) hereof, such Investor
will immediately discontinue disposition of Registrable Securities pursuant to
the Registration Statement covering such Registrable Securities, until the
Investor is advised by the Company that such dispositions may again be made.


 


5.                                       Indemnification.


 


(a)                                  Indemnification
by the Company. The Company will indemnify and hold harmless each Investor
and its officers, directors, members, employees and agents, successors and
assigns, and each other person, if any, who controls such Investor within the
meaning of the 1933 Act, against any losses, claims, damages, liabilities and
expense (including reasonable attorney fees) resulting from (i) any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Statement, any preliminary Prospectus or final Prospectus, or any
amendment or supplement thereof or (ii) any violation by the Company or
its agents of any rule or regulation promulgated under the 1933 Act
applicable to the Company or its agents and relating to action or inaction
required of the Company in connection with such registration; provided,
however, that the Company will not be liable in any such case if and to the
extent that any such loss, claim, damage or liability arises out of or is based
upon (1) an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by such
Investor or any such controlling person in writing specifically for use in such
Registration Statement or Prospectus,  (2) the
use by such Investor of an outdated or defective Prospectus after the Company
has notified such Investor in writing that the Prospectus is outdated or
defective, or (3) the failure of such Investor to deliver a Prospectus as
amended or supplemented prior to the confirmation of a sale.


 


(b)                                 Indemnification
by the Investors. Each Investor agrees, severally but not jointly, to
indemnify and hold harmless, to the fullest extent permitted by law, the
Company, its directors, officers, employees, stockholders and each person who
controls the Company (within the meaning of the 1933 Act) against any losses,
claims, damages, liabilities and expense (including reasonable attorney fees)
resulting from (i) any untrue statement of a material fact or any omission
of a material fact required to be stated in the Registration Statement or
Prospectus or preliminary Prospectus or amendment or supplement thereto or
necessary to make the statements therein not misleading, to the extent, but only
to the extent that such untrue statement or omission is contained in any
information furnished in writing by such Investor to the Company specifically
for inclusion in such Registration Statement or Prospectus or amendment or
supplement thereto, (ii) the use by such Investor of an outdated or
defective Prospectus after the Company has notified such Investor in writing
that the Prospectus is outdated or defective or (iii) the failure of such
Investor to deliver a Prospectus as amended or supplemented prior to the
confirmation of a sale.


 


(c)                                  Conduct
of Indemnification Proceedings. Any person entitled to indemnification
hereunder shall (i) give prompt notice to the indemnifying party of any
claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided


 


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that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person unless (a) the
indemnifying party has agreed to pay such fees or expenses, or (b) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such person or (c) in the
reasonable judgment of any such person, based upon written advice of its
counsel, a conflict of interest exists between such person and the indemnifying
party with respect to such claims (in which case, if the person notifies the
indemnifying party in writing that such person elects to employ separate
counsel at the expense of the indemnifying party, the indemnifying party shall
not have the right to assume the defense of such claim on behalf of such
person); and provided, further, that the failure of any indemnified party to
give notice as provided herein shall not relieve the indemnifying party of its
obligations hereunder, except to the extent that such failure to give notice
shall materially adversely affect the indemnifying party in the defense of any
such claim or litigation. It is understood that the indemnifying party shall
not, in connection with any proceeding in the same jurisdiction, be liable for
fees or expenses of more than one separate firm of attorneys at any time for
all such indemnified parties. No indemnifying party will, except with the
consent of the indemnified party, consent to entry of any judgment or enter
into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect of such claim or litigation.


 


(d)                                 Contribution.
If for any reason the indemnification provided for in the preceding paragraphs (a) and
(b) is unavailable to an indemnified party or insufficient to hold it
harmless, other than as expressly specified therein, then the indemnifying
party shall contribute to the amount paid or payable by the indemnified party
as a result of such loss, claim, damage or liability in such proportion as is
appropriate to reflect the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable considerations. No
person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of
the 1933 Act shall be entitled to contribution from any person not guilty of
such fraudulent misrepresentation. In no event shall the contribution
obligation of a holder of Registrable Securities be greater in amount than the
dollar amount of the proceeds (net of all expenses paid by such holder in
connection with any claim relating to this Section 6 and the amount of any
damages such holder has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission) received by it
upon the sale of the Registrable Securities giving rise to such contribution
obligation.


 


7.                                       Miscellaneous.


 


(a)                                  Amendments
and Waivers. This Agreement may be amended only by a writing signed by the
Company and the Required Investors. The Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Company shall have obtained the written consent to such amendment,
action or omission to act, of the Required Investors.


 


(b)                                 Notices.
All notices and other communications provided for or permitted hereunder shall
be made as set forth in Section 7(f) of the Settlement Agreement.


 


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(c)                                  Assignments
and Transfers by Investors. The provisions of this Agreement shall be
binding upon and inure to the benefit of the Investors and their respective
successors and assigns. An Investor may transfer or assign, in whole or from
time to time in part, to one or more persons its rights hereunder in connection
with the transfer of Registrable Securities by such Investor to such person,
provided that such Investor complies with all laws applicable thereto and
provides written notice of assignment to the Company promptly after such
assignment is effected.


 


(d)                                 Assignments
and Transfers by the Company. This Agreement may not be assigned by the
Company (whether by operation of law or otherwise) without the prior written
consent of the Required Investors, provided, however, that the Company may
assign its rights and delegate its duties hereunder to any surviving or
successor corporation in connection with a merger or consolidation of the
Company with another corporation, or a sale, transfer or other disposition of
all or substantially all of the Company’s assets to another corporation,
without the prior written consent of the Required Investors, after notice duly
given by the Company to each Investor.


 


(e)                                  Benefits
of the Agreement. The terms and conditions of this Agreement shall inure to
the benefit of and be binding upon the respective permitted successors and
assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.


 


(f)                                    Counterparts.
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; provided that a facsimile signature and a signature delivered
electronically (including by delivery via electronic mail of a signature page in
“pdf” format) shall be considered due execution and shall be binding upon the
signatory thereto with the same force and effect as if the signature were an
original, not a facsimile or electronic signature.


 


(g)                                 Titles
and Subtitles. The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting
this Agreement.


 


(h)                                 Severability.
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof but shall be interpreted as if it were written so as to be
enforceable to the maximum extent permitted by applicable law, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law
which renders any provisions hereof prohibited or unenforceable in any respect.


 


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(i)                                     Further
Assurances. The parties shall execute and deliver all such further
instruments and documents and take all such other actions as may reasonably be
required to carry out the transactions contemplated hereby and to evidence the
fulfillment of the agreements herein contained.


 


(j)                                     Entire
Agreement. This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.


 


(k)                                  Governing
Law; Consent to Jurisdiction; Waiver of Jury Trial. All questions
concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by the internal laws of the State of Delaware,
without giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Delaware or any other jurisdictions) that would cause the
application of the laws of any jurisdictions other than the State of
Delaware.  Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of Wilmington, Delaware, 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.  Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE,
AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY
TRANSACTION CONTEMPLATED HEREBY.


 


[Signature
Pages Follow]


 


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IN WITNESS WHEREOF,
each Investor 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:

  
	
   

  	
   

  
	
   

  	
  AMERICAN DEFENSE SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Sidorsky

  
	
   

  	
   

  	
  Name:  Gary Sidorsky

  
	
   

  	
   

  	
  Title:   Chief Financial
  Officer

  



 

















 


IN WITNESS WHEREOF,
each Investor 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.


 


 


	
   

  	
  INVESTORS:

  
	
   

  	
   

  
	
   

  	
  WEST COAST OPPORTUNITY FUND, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Atticus Lowe

  
	
   

  	
   

  	
  Name:  Atticus Lowe

  
	
   

  	
   

  	
  Title:  CIO of Managing Member 

  



 

















 


IN WITNESS WHEREOF,
each Investor 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.


 


 


	
   

  	
  INVESTORS:

  
	
   

  	
   

  
	
   

  	
  CENTAUR VALUE FUND, LP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Zeke Ashton

  
	
   

  	
   

  	
  Name:  Zeke Ashton

  
	
   

  	
   

  	
  Title:   Managing Partner

  



 

















 


IN WITNESS WHEREOF,
each Investor 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.


 


 


	
   

  	
  INVESTORS:

  
	
   

  	
   

  
	
   

  	
  UNITED
  CENTAUR MASTER FUND

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Zeke Ashton

  
	
   

  	
   

  	
  Name:  Zeke Ashton

  
	
   

  	
   

  	
  Title:   Managing Partner

  



 

















 


Exhibit A


 


Plan of Distribution


 


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


 


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


 


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


 


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


 


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


 


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


 


·              privately negotiated transactions;


 


·              short sales effected after the
date the registration statement of which this Prospectus is a part is declared
effective by the SEC;


 


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


 


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


 


·              a combination of any such methods
of sale.


 


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


 

















 


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


 


In connection
with the sale of our common stock or interests therein, the selling
stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the common
stock in the course of hedging the positions they assume. The selling stockholders
may also sell shares of our common stock short and deliver these securities to
close out their short positions, or loan or pledge the common stock to
broker-dealers that in turn may sell these securities. The selling stockholders
may also enter into option or other transactions with broker-dealers or other
financial institutions or the creation of one or more derivative securities
which require the delivery to such broker-dealer or other financial institution
of shares offered by this prospectus, which shares such broker-dealer or other
financial institution may resell pursuant to this prospectus (as supplemented
or amended to reflect such transaction).


 


The aggregate
proceeds to the selling stockholders from the sale of the common stock offered
by them will be the purchase price of the common stock less discounts or
commissions, if any. Each of the selling stockholders reserves the right to
accept and, together with their agents from time to time, to reject, in whole
or in part, any proposed purchase of common stock to be made directly or
through agents. We will not receive any of the proceeds from this offering.


 


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


 


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


 


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


 


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


 

















 


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


 


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


 


We have agreed
with the selling stockholders to keep the registration statement of which this
prospectus constitutes a part effective until the earlier of (1) such time
as all of the shares covered by this prospectus have been disposed of pursuant
to and in accordance with the registration statement or (2) the date on
which the shares may be sold pursuant to Rule 144 of the Securities Act.