buckeye_sb2-ex1011.htm


    Exhibit
      10.11

     

    
      


       

      INVESTOR
        REGISTRATION RIGHTS AGREEMENT

       

      THIS
        INVESTOR REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated
        as of June 29, 2007, by and among BUCKEYE VENTURES, INC., a
        Michigan corporation, with its principal office located at 4455 Lamont Street,
        Suite 3, San Diego, CA 92109 (the “Company”), and the undersigned
        investors (each, an “Investor” and collectively, the
“Investors”).

       

      WHEREAS:

       

      A.  In
        connection with the Securities Purchase Agreement by and among the parties
        hereto of even date herewith (the “Securities Purchase Agreement”), the
        Company has agreed, upon the terms and subject to the conditions of the
        Securities Purchase Agreement, to issue and sell to the Investors secured
        convertible debentures (the “Convertible Debentures”) which shall be
        convertible into that number of shares of the Company’s common stock, par value
        US$.001 per share (the “Common Stock”), pursuant to the terms of the
        Securities Purchase Agreement for an aggregate purchase price of up to Five
        Million U.S. Dollars ($5,000,000). Capitalized terms not defined herein shall
        have the meaning ascribed to them in the Securities Purchase
        Agreement.

       

      B.  To
        induce
        the Investors to execute and deliver the Securities Purchase Agreement, the
        Company has agreed to provide certain registration rights under the Securities
        Act of 1933, as amended, and the rules and regulations thereunder, or any
        similar successor statute (collectively, the “1933 Act”), and applicable
        state securities laws.

       

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

       

      1.            DEFINITIONS.

       

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

       

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

       

      (b)  “Register,”“registered,”
        and “registration” refer to a registration effected by preparing and
        filing one or more Registration Statements (as defined below) in compliance
        with
        the 1933 Act and pursuant to Rule 415 under the 1933 Act or any successor
        rule
        providing for offering securities on a continuous or delayed basis (“Rule
        415”), and the declaration or ordering of effectiveness of such Registration
        Statement(s) by the United States Securities and Exchange Commission (the
        “SEC”).

      


      
        
           

        

        
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      (c)  “Registrable
        Securities” means the shares of Common Stock issuable to Investors upon
        conversion of the Convertible Debentures pursuant to the Securities Purchase
        Agreement and the shares of Common Stock issuable to the Investors upon exercise
        of the Warrant issued pursuant to the Securities Purchase Agreement. As to
        any
        particular Registrable Securities, such securities will cease to be Registrable
        Securities when (a) they have been effectively registered under the 1933
        Act and
        disposed of in accordance with the Registration Statement covering them,
        (b)
        they are or may be freely traded without registration pursuant to Rule 144
        promulgated under the Securities Act, as such Rule may be amended from time
        to
        time, or (c) they have been otherwise lawfully and properly transferred and
        new
        certificates for them not bearing a restrictive legend have been issued by
        the
        Company and the Company shall not have “stop transfer” instructions against
        them.

       

      (d)  “Registration
        Statement” means a registration statement under the 1933 Act which covers
        the Registrable Securities.

       

      2.            REGISTRATION.

       

      (a)  Subject
        to the terms and conditions of this Agreement, the Company shall use its
        best
        efforts to prepare and file with the SEC, no later than forty-five (45) days
        from the First Closing Date (as such term is defined in the Securities Purchase
        Agreement, the “ScheduledFiling Deadline”), a Registration
        Statement on Form S-1 or SB-2 (or, if the Company is then eligible, on Form
        S-3)
        (the “Initial Registration Statement”) for the registration for the
        resale by all Investors who purchased Convertible Debentures pursuant to
        the
        Securities Purchase Agreement at least five (5) times the number of shares
        which
        are anticipated to be issued upon conversion of the Convertible Debentures
        issued pursuant to the Securities Purchase Agreement and the Investor’s Shares
        (subject to Rule 415 restrictions). Prior to the filing of the Registration
        Statement with the SEC, the Company shall furnish a copy of the Initial
        Registration Statement to the Investors and James G. Dodrill II, P.A. for
        their
        review and comment. The Investors and James G. Dodrill II, P.A. shall furnish
        comments on the Initial Registration Statement to the Company by the later
        of:
        (a) seventy-two (72) hours of the receipt thereof from the Company and (b)
        the
        close of the second business day following receipt thereof from the
        Company.

       

      (b)  Effectiveness
        of the Initial Registration Statement. The Company shall use its best
        efforts to (i) to have the Initial Registration Statement declared effective
        by
        the SEC no later than one hundred five (105) days after the First Closing
        Date
        (the “Scheduled EffectiveDeadline”) and (ii) to insure that the
        Initial Registration Statement and any subsequent Registration Statement
        remains
        in effect until all of the Registrable Securities have been sold, or cease
        to be
        outstanding, or the date on which all Registrable Securities may be sold
        in any
        ninety (90) day period under Rule 144 as determined by counsel to the Company
        pursuant to a written opinion letter to such effect delivered to the Investors
        and based on such representations as may be reasonably requested, whichever
        is
        earlier (the “Registration Period”). It shall be an event of default
        hereunder if the Initial Registration Statement is not declared effective
        by the
        SEC by the Scheduled Effective Deadline unless the SEC does not declare the
        Initial Registration. Statement effective solely due to objections based
        upon
        either: (a) Rule 415 or (b) the Investor.

       

      
        
           

        

        
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      (c)  Failure
        to File or Obtain Effectiveness of the Registration Statement. In the event
        the Registration Statement is not filed by the Scheduled Filing Deadline
        or is
        not declared
        effective by the SEC on or before the Scheduled Effective Date (subject to
        the
        caveat in the final sentence of 2(b) above), or if after the Registration
        Statement has been declared effective by the SEC, sales cannot be made pursuant
        to the Registration Statement (whether because of a failure to keep the
        Registration Statement effective, failure by the Company to disclose such
        information as is necessary for sales to be made pursuant to the Registration
        Statement, failure to register sufficient shares of Common Stock or otherwise,
        then as partial relief for the damages to any holder of Registrable Securities
        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 at law or in equity), the Company will pay as liquidated damages
        (the “Liquidated Damages”) to the holder, at the holder’s option, either
        a cash amount or shares of the Company’s Common Stock within three (3) business
        days, after demand therefore, equal to two percent (2%) of the liquidated
        value
        of the Convertible Debentures then outstanding as Liquidated Damages for
        each
        thirty (30) day period (or any part thereof) after the Scheduled Filing Deadline
        or the Scheduled Effective Date as the case may be.

       

      (d)  Liquidated
        Damages. The Company and the Investor hereto acknowledge and agree that the
        sums payable under subsection 2(c) above shall constitute liquidated damages
        and
        not penalties and are in addition to all other rights of the Investor, including
        the right to call a default. The parties further acknowledge that (i) the
        amount
        of loss or damages likely to be incurred is incapable or is difficult to
        precisely estimate, (ii) the amounts specified in such subsection bear a
        reasonable relationship to, and are not plainly or grossly disproportionate
        to,
        the probable loss likely to be incurred in connection with any failure by
        the
        Company to obtain or maintain the effectiveness of a Registration Statement,
        (iii) one of the reasons for the Company and the Investor reaching an agreement
        as to such amounts was the uncertainty and cost of litigation regarding the
        question of actual damages, and (iv) the Company and the Investor are
        sophisticated business parties and have been represented by sophisticated
        and
        able legal counsel and negotiated this Agreement at arm’s length.

       

      (e)  Sufficient
        Number of Shares Registered. In the event the number of shares available
        under a Registration Statement filed pursuant to this Section 2 is insufficient
        to cover all of the Registrable Securities, the Company shall amend the
        Registration Statement, or file a new Registration Statement (on the short
        form
        available therefore, if applicable), or both, so as to cover all of such
        Registrable Securities as soon as practicable, but in any event not later
        than
        forty-five (45) days after the necessity therefore arises. The Company shall
        use
        it best efforts to cause such amendment and/or new Registration Statement
        to
        become effective as soon as practicable following the filing thereof. For
        purposes of the foregoing provision, the number of shares available under
        a
        Registration Statement shall be deemed "insufficient to cover all of the
        Registrable Securities" if at any time the number of Registrable Securities
        issuable on the delivery of a Conversion Notice (as defined in the Convertible
        Debentures) or an Exercise Notice (as defined in the Warrants) is greater
        than
        the number of shares available for resale under such Registration
        Statement.

       

      
        
           

        

        
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      3.            RELATED
        OBLIGATIONS.


       

      (a)  [Reserved]

       

      (b)  The
        Company shall use its best efforts to prepare and file with the SEC such
        amendments (including post-effective amendments) and supplements to the
        Registration Statement and the prospectus used in connection with such
        Registration Statement (which prospectus is to be filed pursuant to Rule
        424
        promulgated under the 1933 Act) as may be necessary to keep such Registration
        Statement effective at all times during the Registration Period, and, during
        such period, comply with the provisions of the 1933 Act with respect to the
        disposition of all Registrable Securities of the Company covered by such
        Registration Statement until such time as all of such Registrable Securities
        shall have been disposed of in accordance with the intended methods of
        disposition by the seller or sellers thereof as set forth in such Registration
        Statement or as otherwise provided in this Agreement. In the case of amendments
        and supplements to a Registration Statement which are required to be filed
        pursuant to this Agreement (including pursuant to this Section 3(b)) by reason
        of the Company’s filing a report on Form 10-KSB, Form 10-QSB or Form 8-K or any
        analogous report under the Securities Exchange Act of 1934, as amended (the
        “1934 Act”), the Company shall incorporate such report by reference into
        the Registration Statement, if applicable, or shall file such amendments
        or
        supplements with the SEC on the same day on which the 1934 Act report is
        filed
        which created the requirement for the Company to amend or supplement the
        Registration Statement.

       

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

       

      (d)  The
        Company shall use its best efforts to (i) register and qualify the Registrable
        Securities covered by a Registration Statement under such other securities
        or
“blue sky” laws of such jurisdictions in the United States as any Investor
        reasonably requests, (ii) prepare and file in those jurisdictions, such
        amendments (including post-effective amendments) and supplements to such
        registrations and qualifications as may be necessary to maintain the
        effectiveness thereof during the Registration Period, (iii) take such other
        actions as may be necessary to maintain such registrations and qualifications
        in
        effect at all times during the Registration Period, and (iv) take all other
        actions reasonably necessary or advisable to qualify the Registrable Securities
        for sale in such jurisdictions; provided, however, that the Company shall
        not be
        required in connection therewith or as a condition thereto to (w) make any
        change to its certificate of incorporation or by-laws, (x) qualify to do
        business in any jurisdiction where it would not otherwise be required to
        qualify
        but for this Section 3(d), (y) subject itself to general taxation in any
        such
        jurisdiction, or (z) file a general consent to service of process in any
        such
        jurisdiction. The Company shall promptly notify each 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 threat of any proceeding for such
        purpose.

       

      
        
           

        

        
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      (e)  As
        promptly as practicable after becoming aware of such event or development,
        taking into account the Company’s good faith assessment of any adverse
        consequences to the Company and its stockholders of the premature disclosure
        of
        such event, the Company shall notify each Investor in writing of the happening
        of any event as a result of which the prospectus included in a Registration
        Statement, as then in effect, includes an untrue statement of a material
        fact or
        omission to state a material fact required to be stated therein or necessary
        to
        make the statements therein, in light of the circumstances under which they
        were
        made, not misleading (provided that in no event shall such notice contain
        any
        material, nonpublic information), and promptly prepare a supplement or amendment
        to such Registration Statement to correct such untrue statement or omission,
        and
        deliver ten (10) copies of such supplement or amendment to each Investor.
        The
        Company shall also promptly notify each Investor in writing (i)
        when
        a
        prospectus or any prospectus supplement or post-effective amendment has been
        filed, and when a Registration Statement or any post-effective amendment
        has
        become effective (notification of such effectiveness shall be delivered to
        each
        Investor by facsimile on the same day of such effectiveness), (ii) of any
        request by the SEC for amendments or supplements to a Registration Statement
        or
        related prospectus or related information, and (iii) of the Company’s reasonable
        determination that a post-effective amendment to a Registration Statement
        would
        be appropriate.

       

      (f)  The
        Company shall use its best efforts to prevent the issuance of any stop order
        or
        other suspension of effectiveness of a Registration Statement, or the suspension
        of the qualification of any of the Registrable Securities for sale in any
        jurisdiction within the United States of America and, if such an order or
        suspension is issued, to obtain the withdrawal of such order or suspension
        at
        the earliest possible moment and to notify each Investor who holds Registrable
        Securities being sold of the issuance of such order and the resolution thereof
        or its receipt of actual notice of the initiation or threat of any proceeding
        for such purpose.

       

      (g)  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, (iii) the release
        of
        such information is ordered pursuant to a subpoena or other final,
        non-appealable order from a court or governmental body of competent
        jurisdiction, or (iv) such information has been made generally available
        to the
        public other than by disclosure in violation of this Agreement or any other
        agreement. The Company agrees that it shall, upon learning that disclosure
        of
        such information concerning an Investor is sought in or by a court or
        governmental body of competent jurisdiction or through other means, give
        prompt
        written notice to such Investor and allow such Investor, at the Investor’s
        expense, to undertake appropriate action to prevent disclosure of, or to
        obtain
        a protective order for, such information.

       

      (h)  The
        Company shall use its best efforts either to cause all the Registrable
        Securities covered by a Registration Statement (i) to be listed on each
        securities exchange on which securities of the same class or series issued
        by
        the Company are then listed, if any, if the listing of such Registrable
        Securities is then permitted under the rules of such exchange or

      


      
        
           

        

        
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      (ii)
        the
        inclusion for quotation on the National Association of Securities Dealers,
        Inc.
        OTC Bulletin Board for such Registrable Securities. The Company shall pay
        all
        fees and expenses in connection with satisfying its obligation under this
        Section 3(h).

       

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

       

      (j)  The
        Company shall use its best efforts to cause the Registrable Securities covered
        by the applicable Registration Statement to be registered with or approved
        by
        such other governmental agencies or authorities as may be necessary to
        consummate the disposition of such Registrable Securities.

       

      (k)  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 the provisions
        of
        Rule 158 under the 1933 Act) covering a twelve (12) month period beginning
        not
        later than the first day of the Company’s fiscal quarter next following the
        effective date of the Registration Statement.

       

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

       

      (m)  Within
        two (2) business days after a Registration Statement which covers Registrable
        Securities is declared effective by the SEC, the Company shall deliver 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.

       

      (n)  The
        Company shall take all other reasonable actions necessary to expedite and
        facilitate the lawful disposition by the Investors of Registrable Securities
        pursuant to a Registration Statement. Upon written request, the Company shall
        make available for inspection by (i) any Investor and (ii) one (1) firm of
        accountants or other agents retained by the Investors (collectively, the
        “Inspectors”) all pertinent financial and other records, and pertinent
        corporate documents and properties of the Company (collectively, the
“Records”), as shall be reasonably deemed necessary by each Inspector,
        and cause the Company’s officers, directors and employees to supply all
        information which any Inspector may reasonably request in writing; provided,
        however, that each Inspector shall agree, and each Investor hereby agrees,
        to
        hold in strict confidence and shall not make any disclosure (except to an
        Investor) or use any Record or other information which the Company determines
        in
        good faith to be confidential, and of which determination the Inspectors
        are so
        notified, unless (a) the disclosure of such Records is necessary to avoid
        or
        correct a misstatement or omission in any Registration Statement or is otherwise
        required under the 1933 Act, (b) the release of such Records is ordered pursuant
        to a final, non-appealable subpoena or order from a court or government body
        of
        competent jurisdiction, or (c) the information in such Records has been made
        generally available to the

      


      
        
           

        

        
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      public
        other than by disclosure in violation of this or any other agreement of which
        the Inspector and the Investor has knowledge. Each Investor agrees that it
        shall, upon learning that disclosure of such Records is sought in or by a
        court
        or governmental body of competent jurisdiction or through other means, give
        prompt notice to the Company and allow the Company, at its expense, to undertake
        appropriate action to prevent disclosure of, or to obtain a protective order
        for, the Records deemed confidential.

       

      4.  OBLIGATIONS
        OF THE INVESTORS.

       

      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(f) or the first
        sentence of Section 3(e), 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(e) or receipt
        of
        notice that no supplement or amendment is required. Notwithstanding anything
        to
        the contrary, the Company shall cause its transfer agent to deliver unlegended
        certificates for shares of Common Stock to a transferee of an Investor in
        accordance with the terms of the Securities Purchase Agreement in connection
        with any sale of Registrable Securities with respect to which an Investor
        has
        entered into a contract for sale prior to the Investor’s receipt of a notice
        from the Company of the happening of any event of the kind described in Section
        3(f) or the first sentence of Section 3(e) and for which the Investor has
        not
        yet settled.

       

      5.  EXPENSES
        OF REGISTRATION.

       

      All
        expenses incurred in connection with registrations, filings or qualifications
        pursuant to Sections 2 and 3, including, without limitation, all registration,
        listing and qualifications fees, printers, legal and accounting fees shall
        be
        paid by the Company. In no event shall the Company be responsible for any
        broker
        or similar commissions or, except to the extent provided for in the Transaction
        Documents, any legal fees or other costs of the Investors.

       

      6.  INDEMNIFICATION.

       

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

       

      (a)
        To
        the fullest extent permitted by law, the Company will, and hereby does,
        indemnify, hold harmless and defend each Investor, the directors, officers,
        partners, employees, agents, representatives of, and each Person, if any,
        who
        controls any Investor within the meaning of the 1933 Act or the 1934 Act
        (each,
        an “Indemnified Person”), against any losses, claims, damages,
        liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’
fees, amounts paid in settlement or expenses, joint or several (collectively,
        “Claims”) incurred in investigating, preparing or defending any action,
        claim, suit, inquiry, proceeding, investigation or appeal taken from the
        foregoing by or before any court or governmental, administrative or other
        regulatory agency, body or the SEC, whether pending or threatened, whether
        or
        not an indemnified party is or may be a party thereto (“Indemnified
        Damages”), to which any of them may become subject insofar as such Claims
        (or actions or proceedings, whether commenced or

      


      
        
           

        

        
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      threatened,
        in respect thereof) arise out of or are based upon: (i) any untrue statement
        or
        alleged untrue statement of a material fact in a Registration Statement or
        any
        post-effective amendment thereto or in any filing made in connection with
        the
        qualification of the offering under the securities or other “blue sky” laws of
        any jurisdiction in which Registrable Securities are offered (“Blue Sky
        Filing”), or the omission or alleged omission to state a material fact
        required to be stated therein or necessary to make the statements therein
        not
        misleading; (ii) any untrue statement or alleged untrue statement of a material
        fact contained in any final prospectus (as amended or supplemented, if the
        Company files any amendment thereof or supplement thereto with the SEC) or
        the
        omission or alleged omission to state therein any material fact necessary
        to
        make the statements made therein, in light of the circumstances under which
        the
        statements therein were made, not misleading; or (iii) any violation or alleged
        violation by the Company of the 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”). The Company
        shall reimburse the Investors and each such controlling person promptly as
        such
        expenses are incurred and are due and payable, for any legal fees or
        disbursements or other reasonable expenses incurred by them in connection
        with
        investigating or defending any such Claim. Notwithstanding anything to the
        contrary contained herein, the indemnification agreement contained in this
        Section 6(a): (w) shall not apply to a Claim by an Indemnified Person arising
        out of or based upon a Violation which occurs in reliance upon and in conformity
        with information furnished in writing to the Company by such Indemnified
        Person
        expressly for use in connection with the preparation of the Registration
        Statement, the prospectus or form of prospectus, or in any amendment or
        supplement thereto, or any such amendment thereof or supplement thereto;
        (x)
        shall not be available to the extent such Claim is based on a failure of
        the
        Investor to timely deliver or to cause to be delivered the prospectus made
        available by the Company, if such prospectus was timely made available by
        the
        Company pursuant to Section 3(c); (y) shall not be available to the extent
        the
        claim arises from or is based upon the willful misfeasance of the Indemnified
        Person; and (z) shall not apply to amounts paid in settlement of any Claim
        if
        such settlement is effected without the prior written consent of the Company,
        which consent shall not be unreasonably withheld. Such indemnity shall remain
        in
        full force and effect regardless of any investigation made by or on behalf
        of
        the Indemnified Person.

       

      (b)
        In
        connection with a Registration Statement, each 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, employees, representatives, or agents 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 is
        based
        upon any Violation, in each case to the extent, and only to the extent, that
        such Violation occurs in reliance upon and in conformity with written
        information furnished to the Company by such Investor expressly for use in
        connection with such Registration Statement, the prospectus or form of
        prospectus, or in any amendment or supplement thereto; and, subject to Section
        6(d), such Investor will reimburse any legal or other expenses reasonably
        incurred by them in connection with investigating or defending any such Claim;
        provided, however, that the indemnity agreement contained in this Section
        6(b)
        and the agreement with respect to

      


      
        
           

        

        
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      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; provided, further,
        however, that the Investor shall be liable under this Section 6(b) for only
        that
        amount of a Claim or Indemnified Damages as does not exceed the net proceeds
        to
        such Investor as a result of the sale of Registrable Securities pursuant
        to such
        Registration Statement. Such indemnity shall remain in full force and effect
        regardless of any investigation made by or on behalf of such Indemnified
        Party.
        Notwithstanding anything to the contrary contained herein, the indemnification
        agreement contained in this Section 6(b) with respect to any prospectus shall
        not inure to the benefit of any Indemnified Party if the untrue statement
        or
        omission of material fact contained in the prospectus was corrected and such
        new
        prospectus was delivered to each Investor prior to such Investor’s use of the
        prospectus to which the Claim relates.

       

      (c)
        Promptly after receipt by an Indemnified Person or Indemnified Party under
        this
        Section 6 of notice of the commencement of any action or proceeding (including
        any governmental action or proceeding) involving a Claim, such Indemnified
        Person or Indemnified Party shall, if a Claim in respect thereof is to be
        made
        against any indemnifying party under this Section 6, deliver to the indemnifying
        party a writt en notice of the commencement thereof, and the indemnifying
        party
        shall have the right to participate in, and, to the extent the indemnifying
        party so desires, jointly with any other indemnifying party similarly noticed,
        to assume control of the defense thereof with counsel mutually satisfactory
        to
        the indemnifying party and the Indemnified Person or the Indemnified Party,
        as
        the case may be; provided, however, that an Indemnified Person or Indemnified
        Party shall have the right to retain its own counsel with the fees and expenses
        of not more than one (1) counsel for such Indemnified Person or Indemnified
        Party to be paid by the indemnifying party, if, in the reasonable opinion
        of
        counsel retained by the indemnifying party, the representation by such counsel
        of the Indemnified Person or Indemnified Party and the indemnifying party
        would
        be inappropriate due to actual or potential differing interests between such
        Indemnified Person or Indemnified Party and any other party represented by
        such
        counsel in such proceeding. The Indemnified Party or Indemnified Person shall
        cooperate fully with the indemnifying party in connection with any negotiation
        or defense of any such action or claim by the indemnifying party and shall
        furnish to the indemnifying party all information reasonably available to
        the
        Indemnified Party or Indemnified Person which relates to such action or claim.
        The indemnifying party shall keep the Indemnified Party or Indemnified Person
        fully apprised at all times as to the status of the defense or any settlement
        negotiations with respect thereto. No indemnifying party shall be liable
        for any
        settlement of any action, claim or proceeding effected without its prior
        written
        consent; provided, however, that the indemnifying party shall not unreasonably
        withhold, delay or condition its consent. No indemnifying party shall, without
        the prior writt en consent of the Indemnified Party or Indemnified Person,
        consent to entry of any judgment or enter into any settlement or other
        compromise which does not include as an unconditional term thereof the giving
        by
        the claimant or plaintiff to such Indemnified Party or Indemnified Person
        of a
        release from all liability in respect to such claim or litigation. Following
        indemnification as provided for hereunder, the indemnifying party shall be
        subrogated to all rights of the Indemnified Party or Indemnified Person with
        respect to all third parties, firms or corporations relating to the matter
        for
        which indemnification has been made. The failure to deliver written notice
        to
        the indemnifying party within a reasonable time of the commencement of any
        such
        action shall not relieve such indemnifying party of any liability to the
        Indemnified Person or Indemnified Party under this Section
        6, except to the extent that the indemnifying party is prejudiced in its
        ability
        to defend such action.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      (d)  The
        indemnification required by this Section 6 shall be made by periodic payments
        of
        the amount thereof during the course of the investigation or defense, as
        and
        when bills are received or Indemnified Damages are incurred.

       

      (e)  The
        indemnity agreements contained herein shall be in addition to (i) any cause
        of
        action or similar right of the Indemnified Party or Indemnified Person against
        the indemnifying party or others, and (ii) any liabilities the indemnifying
        party may be subject to pursuant to the law.

       

      7.  CONTRIBUTION.

       

      To
        the
        extent any indemnification by an indemnifying party is prohibited or limited
        by
        law, the indemnifying party agrees to make the maximum contribution with
        respect
        to any amounts for which it would otherwise be liable under Section 6 to
        the
        fullest extent permitted by law; provided, however, that: (i) no seller of
        Registrable Securities guilty of fraudulent misrepresentation (within the
        meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
        from
        any seller of Registrable Securities who was not guilty of fraudulent
        misrepresentation; and (ii) contribution by any seller of Registrable Securities
        shall be limited in amount to the net amount of proceeds received by such
        seller
        from the sale of such Registrable Securities.

       

      8.  REPORTS
        UNDER THE 1934 ACT.

       

      With
        a
        view to making available to the Investors the benefits of Rule 144 promulgated
        under the 1933 Act or any similar rule or regulation of the SEC that may
        at any
        time permit the Investors to sell securities of the Company to the public
        without registration (“Rule 144”) the Company agrees to:

       

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

       

      (b)  file
        with
        the SEC in a timely manner all reports and other documents required of the
        Company under the 1933 Act and the 1934 Act so long as the Company remains
        subject to such requirements (it being understood that nothing herein shall
        limit the Company’s obligations under Section 4(c) of the Securities Purchase
        Agreement) and the filing of such reports and other documents as are required
        by
        the applicable provisions of Rule 144; and

       

      (c)  furnish
        to each Investor so long as such Investor owns Registrable Securities, promptly
        upon written reasonable request, (i) a written statement by the Company that
        it
        has complied with the reporting requirements of Rule 144, the 1933 Act and
        the
        1934 Act, (ii) a copy of the most recent annual or quarterly report of the
        Company and such other reports and documents so filed by the Company, and
        (iii)
        such other information as may be reasonably requested to permit the Investors
        to
        sell such securities pursuant to Rule 144 without registration.

      


      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      9.  AMENDMENT
        OF REGISTRATION RIGHTS.

       

      Provisions
        of this Agreement may be amended and the observance thereof may be waived
        (either generally or in a particular instance and either retroactively or
        prospectively), only with the written consent of the Company and Investors
        who
        then hold at least two-thirds (2/3) of the Registrable Securities. Any amendment
        or waiver effected in accordance with this Section 9 shall be binding upon
        each
        Investor and the Company. No such amendment shall be effective to the extent
        that it applies to fewer than all of the holders of the Registrable Securities.
        No consideration shall be offered or paid to any Person to amend or consent
        to a
        waiver or modification of any provision of this Agreement unless the same
        consideration also is offered to all of the parties to this
        Agreement.

       

      10.  MISCELLANEOUS.

       

      (a)  A
        Person
        is deemed to be a holder of Registrable Securities whenever such Person owns
        or
        is deemed to own of record such Registrable Securities. If the Company receives
        conflicting instructions, notices or elections from two (2) or more Persons
        with
        respect to the same Registrable Securities, the Company shall act upon the
        basis
        of instructions, notice or election received from the registered owner of
        such
        Registrable Securities.

       

      (b)  Any
        notices, consents, waivers or other communications required or permitted
        to be
        given under the terms of this Agreement must be in writing and will be deemed
        to
        have been delivered: (i) upon receipt, when delivered personally; (ii) upon
        receipt, when sent by facsimile (provided confirmation of transmission is
        mechanically or electronically generated and kept on file by the sending
        party);
        or (iii) one (1) business day after deposit with a nationally recognized
        overnight delivery service, in each case properly addressed to the party
        to
        receive the same. The addresses and facsimile numbers for such communications
        shall be:

       

      
        
          	
                  If
                    to the Company, to:

                	
                  Buckeye
                    Ventures, Inc.

                
	 	
                  4455
                    Lamont Street, Suite 3

                
	 	
                  San
                    Diego, CA 92109

                
	 	
                  Attention:
                    Larry Weinstein

                
	 	
                  Telephone:
                    (858) 272-6600

                
	 	
                  Facsimile:
                    (858) 272-9714

                
	 	 
	
                  With
                    a copy to:

                	
                  Neil
                    W. Gurney, Esq.

                
	 	
                  Ulmer
                    & Berne LLP

                
	 	
                  1660
                    West Second St., Ste. 1100

                
	 	
                  Cleveland,
                    Ohio 44113-1448

                
	 	
                  Telephone:
                    (216) 583-7028

                
	 	
                  Facsimile:
                    (216) 583-7029

                


        

      

       

      If
        to an
        Investor, to its address and facsimile number on the Schedule of Investors
        attached hereto, with copies to such Investor’s representatives as set forth on
        the Schedule of Investors 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

      


      
        
           

        

        
          11

          
            

          

        

        
           

        

      

       

      notice,
        consent, waiver or other communication, (B) mechanically or electronically
        generated by the sender’s facsimile machine containing the time, date, recipient
        facsimile number and an image of the first page of such transmission or (C)
        provided by a courier or overnight courier service shall be rebuttable evidence
        of personal service, receipt by facsimile or receipt from a nationally
        recognized overnight delivery service in accordance with clause (i), (ii)
        or
        (iii) above, respectively.

       

      (c)  Failure
        of any party to exercise any right or remedy under this Agreement or otherwise,
        or delay by a party in exercising such right or remedy, shall not operate
        as a
        waiver thereof.

       

      (d)  The
        laws
        of the State of Michigan shall govern all issues concerning the relative
        rights
        of the Company and the Investors as its stockholders. All other questions
        concerning the construction, validity, enforcement and interpretation of
        this
        Agreement shall be governed by the internal laws of the State of Florida
        without
        giving effect to any choice of law or conflict of law provision or rule (whether
        of the State of Florida or any other jurisdiction) that would cause the
        application of the laws of any jurisdiction other than the State of Florida
        Each
        party hereby irrevocably submits to the non-exclusive jurisdiction of the
        State
        Courts of the State of Florida sitting in Broward County, Florida and federal
        courts for the Southern District of Florida for the adjudication of any dispute
        hereunder or in connection herewith or with any transaction contemplated
        hereby
        or discussed herein, and hereby irrevocably waives, and agrees not to assert
        in
        any suit, action or proceeding, any claim that it is not personally subject
        to
        the jurisdiction of any such court, that such suit, action or proceeding
        is
        brought in an inconvenient forum or that the venue of such suit, action or
        proceeding is improper. Each party hereby irrevocably waives personal service
        of
        process and consents to process being served in any such suit, action or
        proceeding by mailing a copy thereof to such party at the address for such
        notices to it under this Agreement and agrees that such service shall constitute
        good and sufficient service of process and notice thereof. Nothing contained
        herein shall be deemed to limit in any way any right to serve process in
        any
        manner permitted by law. If any provision of this Agreement shall be invalid
        or
        unenforceable in any jurisdiction, such invalidity or unenforceability shall
        not
        affect the validity or enforceability of the remainder of this Agreement
        in that
        jurisdiction or the validity or enforceability of any provision of this
        Agreement in any other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES
        ANY
        RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
        OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS
        AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

       

      (e)  This
        Agreement, the Irrevocable Transfer Agent Instructions, the Securities Purchase
        Agreement and related documents including the Convertible Debenture and the
        Escrow Agreement dated the date hereof by and among the Company, the Investors
        set forth on the Schedule of Investors attached hereto, and James G. Dodrill
        II,
        P.A. (the “EscrowAgreement”) and the Security Agreement dated the
        date hereof (the “Security Agreement”) constitute the entire agreement
        among the parties hereto with respect to the subject matter hereof and thereof.
        There are no restrictions, promises, warranties or undertakings, other than
        those set forth or referred to herein and therein. This Agreement, the
        Irrevocable Transfer Agent Instructions, the Securities Purchase Agreement
        and
        related documents including the Convertible Debenture,
        the Escrow Agreement and the Security Agreement supersede all prior agreements
        and understandings among the parties hereto with respect to the subject matter
        hereof and thereof.

       

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

       

      (f)  This
        Agreement shall inure to the benefit of and be binding upon the permitted
        successors and assigns of each of the parties hereto.

       

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

       

      (h)  This
        Agreement may be executed in identical counterparts, each of which shall
        be
        deemed an original but all of which shall constitute one and the same agreement.
        This Agreement, once executed by a party, may be delivered to the other party
        hereto by facsimile transmission of a copy of this Agreement bearing the
        signature of the party so delivering this Agreement.

       

      (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 the other party may reasonably
        request in order to carry out the intent and accomplish the purposes of this
        Agreement and the consummation of the transactions contemplated
        hereby.

       

      (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.

       

      (k)  This
        Agreement is intended for the benefit of the parties hereto and their respective
        permitted successors and assigns, and is not for the benefit of, nor may
        any
        provision hereof be enforced by, any other Person.

       

      IN
        WITNESS WHEREOF, the parties have caused this Investor Registration
        Rights Agreement to be duly executed as of day and year first above
        written.

       

      
        	 	
                COMPANY:

                BUCKEYE VENTURES, INC.

              	 
	 	 	 	 
	
                 

              	
                By:
                  

              	 	 
	 	Name:	 	 
	 	Title: 	 	 
	 	 	 	 
	 	 	 	 
	 	BUYER:	 	 
	 	TRAFALGAR
                CAPITAL SPECIALIZED INVESTMENT FUND, LUXEMBOURG	 
	 	By:
                Trafalgar Capital Sarl	 
	 	Its: General
                Partner	 
	 	 	 
	 	By:	 
	 	Name:
                Andrew Garai	 
	 	Title:
                Chairman of the Board	 


      

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

       

      SCHEDULE
        I

       

      SCHEDULE
        OF INVESTORS

       

      
        	
                Name

              	 	
                Signature

              	
                Address/Facsimile

                Number
                  of Buyer

              
	
                Trafalgar
                  Capital Specialized

              	
                By:

              	
                Trafalgar
                  Capital Sarl

              	
                8-10
                  Rue Mathias Hardt

                BP
                  3023

              
	
                Investment
                  Fund,

              	
                Its:

              	
                General
                  Partner

              	
                L-1030
                  Luxembourg

              
	
                Luxembourg

              	 	 	
                Facsimile:

              
	 	 	 	
                011-44-207-405-0161

              
	 	
                By:

              	 	
                and

              
	 	
                Name:

              	
                Andrew
                  Garai

              	
                001-786-323-1651

              
	 	
                Its:

              	
                Chairman
                  of the Board

              	 


      

      


      
        
           

        

        
          14

          
            

          

        

        
           

        

      

       

      EXHIBIT
        A

       

      FORM
        OF NOTICE OF EFFECTIVENESS

      OF
        REGISTRATION STATEMENT

       

      Attention:

       

      Re:
        BUCKEYE VENTURES, INC. (the
“Company”) 

       

      Ladies
        and Gentlemen:

       

      Pursuant
        to certain Securities Purchase Agreement (the
“Securities Purchase Agreement”)
        entered into by and among the Company and the investors named therein
        (collectively, the “Investors”), the Company also has entered into a
        Registration Rights Agreement with the Investors (the “Investor Registration
        Rights Agreement”) pursuant to which the Company agreed, among other things,
        to register the Registrable Securities (as defined in the Registration Rights
        Agreement) under the Securities Act of 1933, as amended (the “1933 Act”).
        In connection with the Company’s obligations under the Registration Rights
        Agreement, on _____________,
        the
        Company filed a Registration Statement on Form ____ (File No.
        333-_______) (the “Registration Statement”) with the Securities and
        Exchange SEC
        (the
“SEC”) relating to the Registrable Securities which names each of the
        Investors as a selling stockholder there under.

       

      In
        connection with the foregoing, we advise you that a member of the SEC’s staff
        has advised our legal counsel 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 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.

       

      Very
        truly yours,

       

      By:           
        

       

      cc:
        [LIST NAMES OF INVESTORS]

       

       

       

       

       

      15