EFFECTED BY PREPARING AND FILING ONE OR MORE REGISTRATION STATEMENTS IN
COMPLIANCE WITH THE SECURITIES ACT AND PURSUANT TO RULE 415 AND THE DECLARATION
OR ORDERING OF EFFECTIVENESS OF SUCH REGISTRATION STATEMENT(S) BY THE SEC (AS
DEFINED BELOW).
(H) "REGISTRABLE SECURITIES" MEANS (I) THE COMMON SHARES, (II) THE CONVERSION
SHARES ISSUED OR ISSUABLE UPON CONVERSION OF THE CONVERTIBLE NOTES, (III) THE
WARRANT SHARES ISSUED OR ISSUABLE UPON EXERCISE OF THE WARRANTS AND (IV) ANY
SHARE CAPITAL OF THE COMPANY ISSUED OR ISSUABLE WITH RESPECT TO THE COMMON
SHARES, CONVERSION SHARES OR THE WARRANT SHARES AS A RESULT OF ANY STOCK SPLIT,
STOCK DIVIDEND, RECAPITALIZATION, EXCHANGE OR SIMILAR EVENT OR OTHERWISE,
WITHOUT REGARD TO ANY LIMITATIONS ON CONVERSIONS OF THE CONVERTIBLE NOTES OR
EXERCISES OF THE WARRANTS; PROVIDED THAT, SUCH SHARES WILL NOT BE DEEMED TO BE
"REGISTRABLE SECURITIES" IF SUCH SHARES ARE SOLD OR SELLABLE UNDER RULE 144
WITHOUT RESTRICTION OF THE VOLUME LIMITATIONS OF RULE 144(E).
(I) "REGISTRATION STATEMENT" MEANS A REGISTRATION STATEMENT OR REGISTRATION
STATEMENTS OF THE COMPANY FILED UNDER THE SECURITIES ACT COVERING THE
REGISTRABLE SECURITIES.
(J) "REQUIRED HOLDERS" MEANS THE HOLDERS OF AT LEAST A MAJORITY OF THE
OUTSTANDING REGISTRABLE SECURITIES.
(K) "RULE 415" MEANS RULE 415 UNDER THE SECURITIES ACT OR ANY SUCCESSOR RULE
PROVIDING FOR OFFERING SECURITIES ON A CONTINUOUS OR DELAYED BASIS.
(L) "SEC" MEANS THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION.
2. REGISTRATION.
(A) MANDATORY REGISTRATION.
THE COMPANY SHALL PREPARE AND, AS SOON AS
REASONABLY PRACTICABLE, FILE WITH THE SEC THE REGISTRATION STATEMENT ON FORM S-3
COVERING THE RESALE OF ALL OF THE REGISTRABLE SECURITIES.
IN THE EVENT THAT
FORM S-3 IS UNAVAILABLE FOR SUCH A REGISTRATION, THE COMPANY SHALL USE SUCH
OTHER FORM AS IS AVAILABLE FOR SUCH A REGISTRATION ON ANOTHER APPROPRIATE FORM
REASONABLY ACCEPTABLE TO THE REQUIRED HOLDERS, SUBJECT TO THE PROVISIONS OF
SECTION 2(D).
THE REGISTRATION STATEMENT SHALL CONTAIN (EXCEPT IF OTHERWISE
DIRECTED BY THE REQUIRED HOLDERS) "SELLING SHAREHOLDERS" AND "PLAN OF
DISTRIBUTION" SECTIONS TO BE MUTUALLY AGREED UPON BY THE COMPANY AND THE
REQUIRED HOLDERS.
THE COMPANY SHALL USE REASONABLE COMMERCIAL EFFORTS TO HAVE
THE REGISTRATION STATEMENT DECLARED EFFECTIVE BY THE SEC AS SOON AS PRACTICABLE,
BUT IN NO EVENT LATER THAN THE EFFECTIVENESS DEADLINE.
2
(B) LEGAL COUNSEL.
SUBJECT TO SECTION 5 HEREOF, THE REQUIRED HOLDERS SHALL HAVE
THE RIGHT TO SELECT ONE LEGAL COUNSEL TO REVIEW AND OVERSEE ANY REGISTRATION
PURSUANT TO THIS SECTION 2 ("LEGAL COUNSEL"), WHICH SHALL BE THELEN REID BROWN
RAYSMAN & STEINER LLP OR SUCH OTHER COUNSEL AS THEREAFTER DESIGNATED BY THE
REQUIRED HOLDERS.
THE COMPANY AND LEGAL COUNSEL SHALL REASONABLY COOPERATE WITH
EACH OTHER IN PERFORMING THE COMPANY'S OBLIGATIONS UNDER THIS AGREEMENT.
(C) INELIGIBILITY FOR FORM S-3.
IN THE EVENT THAT FORM S-3 IS NOT AVAILABLE FOR
THE REGISTRATION OF THE RESALE OF REGISTRABLE SECURITIES HEREUNDER, THE COMPANY
SHALL (I) REGISTER THE RESALE OF THE REGISTRABLE SECURITIES ON ANOTHER
APPROPRIATE FORM REASONABLY ACCEPTABLE TO THE REQUIRED HOLDERS AND (II)
UNDERTAKE TO REGISTER THE REGISTRABLE SECURITIES ON FORM S-3 AS