Document:

ex_10-7.htm

    
      

      

    

    Exhibit
      10.7

     

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    This
      Registration Rights Agreement is made and entered into as of October 31, 2007
      (as amended, modified or supplemented from time to time, this
“Agreement”) by and between General Environmental Management, Inc., a
      Nevada (the “Company”), and Valens Offshore SPV II, Corp. (the
“Investor”).

     

    This
      Agreement is made pursuant to the Securities Purchase Agreement dated as of
      the
      date hereof by and between the Company, the Investor, the other Purchasers
      and
      the LV Administrative Services Corp., as administrative and collateral agent
      for
      the Purchasers (as amended, restated modified and/or supplemented from time
      to
      time, the “Purchase Agreement”).

     

    The
      Company and the Investor hereby agree as follows:

     

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

     

    “Commission”
      means the Securities and Exchange Commission.

     

    “Common
      Stock” means shares of the Company’s common stock, par value $0.001 per
      share.

     

    “Company”
      has the meaning given to such term in the Preamble hereto.

     

    “Cut
      Back Registration” has the meaning set forth in Section 2(d).

     

    “Effectiveness
      Date” means, (i) with respect to the initial Registration Statement
      required to be filed in connection with the Notes and the Warrants issued on
      the
      date hereof, a date no later than one hundred eighty (180) days following the
      date hereof and (ii) with respect to each additional Registration Statement
      required to be filed hereunder (if any), including a Cut Back Registration,,
      a
      date no later than thirty (30) days following the applicable Filing
      Date.

     

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

     

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

     

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

     

    “Exchange
      Act” means the Securities Exchange Act of 1934, as amended, and any
      successor statute.

     

    “Filing
      Date” means, with respect to (1) the Registration Statement required to be
      filed in connection with the shares of Common Stock issuable to the Holder
      upon
      (x) conversion of the Notes issued as of the date hereof and (y) exercise of
      any
      Warrant issued as of the date hereof, the date which is sixty (60) days
      following the date hereof (subject to the provisions of Section 2(d) hereof),
      (2) the Registration Statement required to be filed in connection with the
      shares of Common Stock issuable to the Holder upon exercise of any Warrant
      issued after the date hereof, the date which is thirty (30) days after the
      issuance of such Warrant and (3) the Registration Statement required to be
      filed
      in connection with the shares of Common Stock issuable to the Holder as a result
      of adjustments to (x) the Fixed Conversion Price made pursuant to Section 3.6
      of
      the Notes, or (y) the Exercise Price made pursuant to Section 4 of the Warrant,
      or otherwise, thirty (30) days after the occurrence of such event or the date
      of
      the adjustment of the Fixed Conversion Price or Exercise Price, as
      applicable.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    “Holder”
      or “Holders” means the Investor or any of its affiliates or transferees
      to the extent any of them hold Registrable Securities, other than those
      purchasing Registrable Securities in a market transaction.

     

    “Indemnified
      Party” has the meaning set forth in Section 5(c).

     

    “Indemnifying
      Party” has the meaning set forth in Section 5(c).

     

    “Notes”
      has the meaning given to the term in the Purchase Agreement.

     

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

     

    “Prospectus”
      means the prospectus included in a Registration Statement (including, without
      limitation, a prospectus that includes any information previously omitted from
      a
      prospectus filed as part of an effective registration statement in reliance
      upon
      Rule 430A promulgated under the Securities Act), as amended or supplemented
      by
      any prospectus supplement, with respect to the terms of the offering of any
      portion of the Registrable Securities covered by such Registration Statement,
      and all other amendments and supplements to the Prospectus, including
      post-effective amendments, and all material incorporated by reference or deemed
      to be incorporated by reference in such Prospectus.

     

    “Purchase
      Agreement” has the meaning given to such term in the Preamble
      hereto.

     

    “Registrable
      Securities” means the shares of Common Stock issuable upon conversion of
      the Notes and exercise of the Warrants.

     

    “Registration
      Statement” means each registration statement required to be filed
      hereunder, including the Prospectus therein, amendments and supplements to
      such
      registration statement or Prospectus, including pre- and post-effective
      amendments, all exhibits thereto, and all material incorporated by reference
      or
      deemed to be incorporated by reference in such registration
      statement.

     

    “Rule
      144” means Rule 144 promulgated by the Commission pursuant to the
      Securities Act, as such Rule may be amended from time to time, or any similar
      rule or regulation hereafter adopted by the Commission having substantially
      the
      same effect as such Rule.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Rule
      415” means Rule 415 promulgated by the Commission pursuant to the
      Securities Act, as such Rule may be amended from time to time, or any similar
      rule or regulation hereafter adopted by the Commission having substantially
      the
      same effect as such Rule.

     

    “Securities
      Act” means the Securities Act of 1933, as amended, and any successor
      statute.

     

    “Trading
      Market” means any of the NASD Over The Counter Bulletin Board, NASDAQ
      Capital Market, the NASDAQ Global Market, the American Stock Exchange or the
      New
      York Stock Exchange.

     

    “Warrants”
      means the Common Stock purchase warrants issued in connection with the Purchase
      Agreement, whether on the date thereof or thereafter.

     

    2.            
      Registration.

     

    (a)  On
      or
      prior to each Filing Date, the Company shall prepare and file with the
      Commission a Registration Statement covering the Registrable Securities for
      a
      selling stockholder resale offering to be made on a continuous basis pursuant
      to
      Rule 415.  Each Registration Statement shall be on Form S-3 (except if
      the Company is not then eligible to register for resale the Registrable
      Securities on Form S-3, in which case such registration shall be on another
      appropriate form in accordance herewith).  The Company shall cause
      each Registration Statement to become effective and remain effective as provided
      herein.  The Company shall use its best efforts to cause each
      Registration Statement to be declared effective under the Securities Act as
      promptly as possible after the filing thereof, but in any event no later than
      the Effectiveness Date.  The Company shall use its best efforts to
      keep each Registration Statement continuously effective under the Securities
      Act
      until the date which is the earlier date of when (i) all Registrable Securities
      covered by such Registration Statement have been sold or (ii) all Registrable
      Securities covered by such Registration Statement may be sold immediately
      without registration under the Securities Act and without volume restrictions
      pursuant to Rule 144(k), as determined by the counsel to the Company pursuant
      to
      a written opinion letter to such effect, addressed and acceptable to the
      Company’s transfer agent and the affected Holders (each, an “Effectiveness
      Period”).

     

    (b)  If:
      (i)
      the Registration Statement is not filed on or prior to the Filing Date; (ii)
      the
      Registration Statement is not declared effective by the Commission by the
      Effectiveness Date; (iii) after the Registration Statement is filed with and
      declared effective by the Commission, the Registration Statement ceases to
      be
      effective (by suspension or otherwise) as to all Registrable Securities to
      which
      it is required to relate at any time prior to the expiration of the
      Effectiveness Period (without being succeeded immediately by an additional
      registration statement filed and declared effective) for a period of time which
      shall exceed 30 days in the aggregate per year or more than 20 consecutive
      calendar days (defined as a period of 365 days commencing on the date the
      Registration Statement is declared effective); or (iv) the Common Stock is
      not
      listed or quoted, or is suspended from trading on any Trading Market for a
      period of three (3) consecutive Trading Days (provided the Company shall not
      have been able to cure such trading suspension within 30 days of the notice
      thereof or list the Common Stock on another Trading Market); (any such failure
      or breach being referred to as an “Event,” and for purposes of clause (i) or
      (ii) the date on which such Event occurs, or for purposes of clause (iii) the
      date which such 30 day or 20 consecutive day period (as the case may be) is
      exceeded, or for purposes of clause (iv) the date on which such three (3)
      Trading Day period is exceeded, being referred to as “Event Date”), then
      until the applicable Event is cured, the Company shall pay to each Holder an
      amount in cash, as liquidated damages and not as a penalty, equal to 2.0% for
      each thirty (30) day period (prorated for partial periods) on a daily basis
      of
      the original principal amount of the Note.  While such Event
      continues, such liquidated damages shall be paid not less often than each thirty
      (30) days.  Any unpaid liquidated damages as of the date when an Event
      has been cured by the Company shall be paid within three (3) days following
      the
      date on which such Event has been cured by the Company.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (c)  Within
      three (3) business days of the Effectiveness Date, the Company shall cause
      its
      counsel to issue a blanket opinion in the form attached hereto as Exhibit A,
      to
      the transfer agent stating that the shares are subject to an effective
      registration statement and can be reissued free of restrictive legend upon
      notice of a sale by the Investor and confirmation by the Investor that it has
      complied with the prospectus delivery requirements, provided that the
      Company has not advised the transfer agent orally or in writing that the opinion
      has been withdrawn. Copies of the blanket opinion required by this Section
      2(c)
      shall be delivered to the Investor within the time frame set forth
      above.

     

    (d)  Notwithstanding
      the other provisions of this Agreement, 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, 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 (collectively,
      the “SEC Restrictions”). Any cut-back imposed pursuant to this Section 2(d)
      shall be allocated among the Investor and any other selling security holder
      holding shares that are not eligible to be made on a delayed or continuous
      basis
      under the provisions of Rule 415, on a pro-rata basis, unless the SEC
      Restrictions otherwise require.  The Company shall file a Registration
      Statement covering the Cut Back Shares (a "Cut Back Registration") within thirty
      (30) days after the date on which the SEC declares the initial Registration
      Statement effective, or April 30, 2008 which ever date is earlier, as the SEC
      may mandate (the "Cut Back Filing Date") and shall cause such Registration
      Statement to become effective by the applicable Effectiveness
      Date.  No damages shall accrue on or as to any Cut Back Shares unless
      and until the Company has failed to meet the Cut Back Filing Date or the
      applicable Effectiveness Date.

     

    3.            
      Registration
      Procedures.  If and whenever the Company is required by the
      provisions hereof to effect the registration of any Registrable Securities
      under
      the Securities Act, the Company will, as expeditiously as possible:

     

    (a)  prepare
      and file with the Commission a Registration Statement with respect to such
      Registrable Securities, respond as promptly as possible to any comments received
      from the Commission, and use its best efforts to cause such Registration
      Statement to become and remain effective for the Effectiveness Period with
      respect thereto, and promptly provide to the Investor copies of all filings
      and
      Commission letters of comment relating thereto and before filing a Registration
      Statement or Prospectus or any amendments or supplements thereto, furnish to
      the
Investor copies of all such
      documents proposed to be filed, including documents incorporated by reference
      in
      the Prospectus and, if requested by the Investor, the exhibits incorporated
      by
      reference, and the Investor shall have the opportunity
      to object to
      any information pertaining to itself that is contained therein and the
      Company will make the corrections reasonably requested by the
Investor with respect to
      such information prior to filing any Registration Statement or amendment thereto
      or any Prospectus or any supplement thereto;

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (b)  prepare
      and file with the Commission such amendments and supplements to such
      Registration Statement and the Prospectus used in connection therewith as may
      be
      necessary to comply with the provisions of the Securities Act with respect
      to
      the disposition of all Registrable Securities covered by such Registration
      Statement and to keep such Registration Statement effective until the expiration
      of the Effectiveness Period applicable to such Registration
      Statement;

     

    (c)  furnish
      to the Investor such number of copies of the Registration Statement and the
      Prospectus included therein (including each preliminary Prospectus and any
      amendments and supplements to the Registration Statement and the Prospectus)
      and
      such other documents as the Investor reasonably may request to facilitate the
      public sale or disposition of the Registrable Securities covered by such
      Registration Statement;

     

    (d)  use
      its
      best efforts to register or qualify the Investor’s Registrable Securities
      covered by such Registration Statement under the securities or “blue sky” laws
      of such jurisdictions within the United States as the Investor may reasonably
      request and do any and all other acts and things which may be reasonably
      necessary or advisable to enable the Investor to consummate the disposition
      in
      such jurisdiction of the Registrable Securities, provided,
however, that the Company shall not for any such purpose be required
      to
      qualify generally to transact business as a foreign corporation in any
      jurisdiction where it is not so qualified or to consent to general service
      of
      process in any such jurisdiction;

     

    (e)  immediately
      notify the Investor at any time when a Prospectus relating thereto is required
      to be delivered under the Securities Act, of the happening of any event as
      a
      result of which the Prospectus contained in such Registration Statement, as
      then
      in effect, includes an untrue statement of a material fact or omits to state
      a
      material fact required to be stated therein or necessary to make the statements
      therein not misleading, and, at the request of the Investor, the Company shall
      prepare a supplement or amendment to such Prospectus so that, as thereafter
      delivered to the purchasers of Registrable Securities, such Prospectus shall
      not
      contain an untrue statement of a material fact or omit to state any material
      fact required to be stated therein or necessary to make the statement therein
      not misleading;

     

    (f)  make
      available for inspection by the Investor and any attorney, accountant or other
      agent retained by the Investor, all publicly available, non-confidential
      financial and other records, pertinent corporate documents and properties of
      the
      Company, and cause the Company’s officers, directors and employees to supply all
      publicly available, non-confidential information reasonably requested by the
      attorney, accountant or agent of the Investor;

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (g)  provide
      a
      transfer agent and registrar for all such Registrable Securities not later
      than
      the effective date of such Registration Statement;

     

    (h)  if
      requested, cause to be delivered, immediately prior to the effectiveness of
      the
      Registration Statement, letters from the Company’s independent certified public
      accountants addressed to the Investor (unless the Investor does not provide
      to
      such accountants the appropriate representation letter required by rules
      governing the accounting profession) stating that such accountants are
      independent public accountants within the meaning of the Securities Act and
      the
      applicable rules and regulations adopted by the Commission thereunder, and
      otherwise in customary form and covering such financial and accounting matters
      as are customarily covered by letters of the independent certified public
      accountants delivered in connection with primary or secondary underwritten
      public offerings, as the case may be;

     

    (i)  at
      all
      times after the Company has filed a Registration Statement with the Commission
      pursuant to the requirements of either the Securities Act or the Exchange Act,
      the Company shall file all reports required to be filed by it under the
      Securities Act and the Exchange Act and the rules and regulations adopted by
      the
      Commission thereunder, and take such further action as the Investor may
      reasonably request, all to the extent required to enable the Investor to be
      eligible to sell Registrable Securities pursuant to Rule 144 (or any similar
      rule then in effect); and

     

    (j)  notify
      the Holder if the Company receives a comment, verbal or written, from the SEC
      to
      the effect that the offering of some or all of the Registrable Securities cannot
      be made on a delayed or continuous basis under the provisions of Rule 415 and
      provide the Holder’s counsel an opportunity to comment upon the Company’s
      proposed response to such comment.

     

    4.            
      Registration
      Expenses.  All expenses relating to the Company’s compliance
      with Sections 2 and 3 hereof, including, without limitation, all registration,
      filing and listing application fees, costs of distributing any prospectuses
      and
      supplements thereto, printing expenses, fees and disbursements of counsel and
      independent public accountants for the Company, fees and expenses (including
      counsel fees) incurred in connection with complying with state securities or
      “blue sky” laws, fees of the NASD, transfer taxes, fees of transfer agents and
      registrars, fees of, and disbursements incurred by, one counsel for the Holders
      are called “Registration Expenses.” All selling commissions applicable to the
      sale of Registrable Securities, including any fees and disbursements of any
      special counsel to the Holders beyond those included in Registration Expenses,
      are called “Selling Expenses.”  The Company shall only be responsible
      for all Registration Expenses.  The obligation of the Company to bear
      the expenses described  above  shall apply irrespective of
      whether a registration, becomes effective, is withdrawn or suspended, is
      converted to another form of registration and irrespective of when any of the
      foregoing shall occur.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    5.            
      Indemnification.

     

    (a)  In
      the
      event of a registration of any Registrable Securities under the Securities
      Act
      pursuant to this Agreement, the Company will indemnify and hold harmless each
      Holder, and its officers, directors and each other person, if any, who controls
      such Holder within the meaning of the Securities Act, against any losses,
      claims, damages or liabilities, joint or several, to which such Holder, or
      such
      persons may become subject under the Securities Act or otherwise, insofar as
      such losses, claims, damages or liabilities (or actions in respect thereof)
      arise out of or are based upon any untrue statement or alleged untrue statement
      of any material fact contained in any Registration Statement under which such
      Registrable Securities were registered under the Securities Act pursuant to
      this
      Agreement, any preliminary Prospectus or final Prospectus contained therein,
      or
      any amendment or supplement thereof, or arise out of or are based upon the
      omission or alleged omission to state therein a material fact required to be
      stated therein or necessary to make the statements therein not misleading or
      any
      violation or alleged violation by the Company of the Securities Act, the
      Exchange Act or applicable “blue sky” laws, and will reimburse such Holder, and
      each such person for any legal or other expenses incurred by them in connection
      with investigating or defending any such loss, claim, damage, liability or
      action; 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 an untrue statement or alleged untrue
      statement or omission or alleged omission so made in conformity with information
      furnished by or on behalf of the Investor or any such person in writing
      specifically for use in any such document.

     

    (b)  In
      the
      event of a registration of the Registrable Securities under the Securities
      Act
      pursuant to this Agreement, the Investor will indemnify and hold harmless the
      Company, and its officers, directors and each other person, if any, who controls
      the Company within the meaning of the Securities Act, against all losses,
      claims, damages or liabilities, joint or several, to which the Company or such
      persons may become subject under the Securities Act or otherwise, insofar as
      such losses, claims, damages or liabilities (or actions in respect thereof)
      arise out of or are based upon any untrue statement or alleged untrue statement
      of any material fact which was furnished in writing by the Investor to the
      Company expressly for use in (and such information is contained in) the
      Registration Statement under which such Registrable Securities were registered
      under the Securities Act pursuant to this Agreement, any preliminary Prospectus
      or final Prospectus contained therein, or any amendment or supplement thereof,
      or arise out of or are based upon the omission or alleged omission to state
      therein a material fact required to be stated therein or necessary to make
      the
      statements therein not misleading, and will reimburse the Company and each
      such
      person for any reasonable legal or other expenses incurred by them in connection
      with investigating or defending any such loss, claim, damage, liability or
      action, provided, however, that the Investor will be liable in any
      such case if and only to the extent that any such loss, claim, damage or
      liability arises out of or is based upon an untrue statement or alleged untrue
      statement or omission or alleged omission so made in conformity with information
      furnished in writing to the Company by or on behalf of the Investor specifically
      for use in any such document.  Notwithstanding the provisions of this
      paragraph, the Investor shall not be required to indemnify any person or entity
      in excess of the amount of the aggregate net proceeds received by the Investor
      in respect of Registrable Securities in connection with any such registration
      under the Securities Act.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (c)  Promptly
      after receipt by a party entitled to claim indemnification hereunder (an
“Indemnified Party”) of notice of the commencement of any action, such
      Indemnified Party shall, if a claim for indemnification in respect thereof
      is to
      be made against a party hereto obligated to indemnify such Indemnified Party
      (an
“Indemnifying Party”), notify the Indemnifying Party in writing thereof,
      but the omission so to notify the Indemnifying Party shall not relieve it from
      any liability which it may have to such Indemnified Party other than under
      this
      Section 5(c) and shall only relieve it from any liability which it may have
      to
      such Indemnified Party under this Section 5(c) if and to the extent the
      Indemnifying Party is prejudiced by such omission. In case any such action
      shall
      be brought against any Indemnified Party and it shall notify the Indemnifying
      Party of the commencement thereof, the Indemnifying Party shall be entitled
      to
      participate in and, to the extent it shall wish, to assume and undertake the
      defense thereof with counsel satisfactory to such Indemnified Party, and, after
      notice from the Indemnifying Party to such Indemnified Party of its election
      so
      to assume and undertake the defense thereof, the Indemnifying Party shall not
      be
      liable to such Indemnified Party under this Section 5(c) for any legal expenses
      subsequently incurred by such Indemnified Party in connection with the defense
      thereof; if the Indemnified Party retains its own counsel, then the Indemnified
      Party shall pay all fees, costs and expenses of such counsel, provided,
however, that, if the defendants in any such action include both the
      Indemnified Party and the Indemnifying Party and the Indemnified Party shall
      have reasonably concluded that there may be reasonable defenses available to
      it
      which are different from or additional to those available to the Indemnifying
      Party or if the interests of the Indemnified Party reasonably may be deemed
      to
      conflict with the interests of the Indemnifying Party, the Indemnified Party
      shall have the right to select one separate counsel and to assume such legal
      defenses and otherwise to participate in the defense of such action, with the
      reasonable expenses and fees of such separate counsel and other expenses related
      to such participation to be reimbursed by the Indemnifying Party as
      incurred.

     

    (d)  In
      order
      to provide for just and equitable contribution in the event of joint liability
      under the Securities Act in any case in which either (i) the Investor, or any
      officer, director or controlling person of the Investor, makes a claim for
      indemnification pursuant to this Section 5 but it is judicially determined
      (by
      the entry of a final judgment or decree by a court of competent jurisdiction
      and
      the expiration of time to appeal or the denial of the last right of appeal)
      that
      such indemnification may not be enforced in such case notwithstanding the fact
      that this Section 5 provides for indemnification in such case, or (ii)
      contribution under the Securities Act may be required on the part of the
      Investor or such officer, director or controlling person of the Investor in
      circumstances for which indemnification is provided under this Section 5; then,
      and in each such case, the Company and the Investor will contribute to the
      aggregate losses, claims, damages or liabilities to which they may be subject
      (after contribution from others) in such proportion so that the Investor is
      responsible only for the portion represented by the percentage that the public
      offering price of its securities offered by the Registration Statement bears
      to
      the public offering price of all securities offered by such Registration
      Statement, provided, however, that, in any such case, (A) the
      Investor will not be required to contribute any amount in excess of the public
      offering price of all such securities offered by it pursuant to such
      Registration Statement; and (B) no person or entity guilty of fraudulent
      misrepresentation (within the meaning of Section 10(f) of the Act) will be
      entitled to contribution from any person or entity who was not guilty of such
      fraudulent misrepresentation.

     

    (e)  The
      indemnification provided for under this Agreement shall remain in full force
      and
      effect regardless of any investigation made by or on behalf of the indemnified
      party or any officer, director or controlling Person of such indemnified party
      and shall survive the transfer of securities.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    6.            
      Representations
      and Warranties.

     

    (a)  The
      Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
      Act and, except with respect to certain matters which the Company has disclosed
      to the Investor on Schedule 4.21 to the Purchase Agreement, the Company
      has timely filed all proxy statements, reports, schedules, forms, statements
      and
      other documents required to be filed by it under the Exchange
      Act.  The Company has filed (i) its Annual Report on Form 10-KSB for
      its fiscal year ended December 31, 2006 and (ii) its Quarterly Report on Form
      10-QSB for the fiscal quarters ended March 31, 2007 and June 30, 2007
      (collectively, the “SEC Reports”).  Each SEC Report was, at the time
      of its filing, in substantial compliance with the requirements of its respective
      form and none of the SEC Reports, nor the financial statements (and the notes
      thereto) included in the SEC Reports, as of their respective filing dates,
      contained any untrue statement of a material fact or omitted 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.  The financial statements of the Company included in the
      SEC Reports comply as to form in all material respects with applicable
      accounting requirements and the published rules and regulations of the
      Commission or other applicable rules and regulations with respect
      thereto.  Such financial statements have been prepared in accordance
      with generally accepted accounting principles (“GAAP”) applied on a
      consistent basis during the periods involved (except (i) as may be otherwise
      indicated in such financial statements or the notes thereto or (ii) in the
      case
      of unaudited interim statements, to the extent they may not include footnotes
      or
      may be condensed) and fairly present in all material respects the financial
      condition, the results of operations and the cash flows of the Company and
      its
      subsidiaries, on a consolidated basis, as of, and for, the periods presented
      in
      each such SEC Report.

     

    (b)  The
      Common Stock is listed or quoted, as applicable, for trading on the NASDAQ
      Over
      The Counter Bulletin Board and satisfies all requirements for the continuation
      of such listing or quotation, as applicable, and the Company shall do all things
      necessary for the continuation of such listing or quotation, as
      applicable.  The Company has not received any notice that its Common
      Stock will be delisted from or no longer be quoted on, as applicable, the NASDAQ
      Over The Counter Bulletin Board (except for prior notices which have been fully
      remedied) or that the Common Stock does not meet all requirements for the
      continuation of such listing or quotation, as applicable.

     

    (c)  Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf, has directly or indirectly made any offers or sales of any security
      or
      solicited any offers to buy any security under circumstances that would cause
      the offering of the Securities pursuant to the Purchase Agreement to be
      integrated with prior offerings by the Company for purposes of the Securities
      Act which would prevent the Company from selling the Common Stock pursuant
      to
      Rule 506 under the Securities Act, or any applicable exchange-related
      stockholder approval provisions, nor will the Company or any of its affiliates
      or subsidiaries take any action or steps that would cause the offering of the
      Securities to be integrated with other offerings (other than such concurrent
      offering to the Investor).

     

    (d)  The
      Warrants and the shares of Common Stock that the Investor may acquire pursuant
      to the Warrants are all restricted securities under the Securities Act as of
      the
      date of this Agreement.  The Company will not issue any stop transfer
      order or other order impeding the sale and delivery of any of the Registrable
      Securities at such time as such Registrable Securities are registered for public
      sale or an exemption from registration is available, except as required by
      federal or state securities laws.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (e)  The
      Company understands the nature of the Registrable Securities issuable upon
      the
      conversion of each Note and exercise of each Warrant and recognizes that the
      issuance of such Registrable Securities may have a potential dilutive
      effect.  The Company specifically acknowledges that its obligation to
      issue the Registrable Securities is binding upon the Company and enforceable
      regardless of the dilution such issuance may have on the ownership interests
      of
      other shareholders of the Company.

     

    (f)  Except
      for agreements made in the ordinary course of business, there is no agreement
      that has not been filed with the Commission as an exhibit to a registration
      statement or to a form required to be filed by the Company under the Exchange
      Act, the breach of which could reasonably be expected to have a material and
      adverse effect on the Company and its subsidiaries, or would prohibit or
      otherwise interfere with the ability of the Company to enter into and perform
      any of its obligations under this Agreement in any material
      respect.

     

    (g)  The
      Company will at all times have authorized and reserved a sufficient number
      of
      shares of Common Stock for the full conversion of the Notes and exercise of
      the
      Warrants.

     

    (h)  The
      Company shall provide written notice to each Holder of (i) the occurrence of
      each Discontinuation Event (as defined below) and (ii) the declaration of
      effectiveness by the Commission of each Registration Statement required to
      be
      filed hereunder, in each case within one (1) business day of the date of each
      such occurrence and/or declaration.

     

    7.            
      Miscellaneous.

     

    (a)  Remedies.  In
      the event of a breach by the Company or by a Holder, of any of their respective
      obligations under this Agreement, each Holder or the Company, as the case may
      be, in addition to being entitled to exercise all rights granted by law and
      under this Agreement, including recovery of damages, will be entitled to
      specific performance of its rights under this Agreement.

     

    (b)  No
      Piggyback on Registrations.  Except as and to the extent set
      forth on Schedule 7(b) hereto, neither the Company nor any of its security
      holders (other than the Holders in such capacity pursuant hereto) may include
      securities of the Company in any Registration Statement other than the
      Registrable Securities, and the Company shall not after the date hereof enter
      into any agreement providing any such right for inclusion of shares in the
      Registration Statement to any of its security holders.  Except as and
      to the extent specified in Schedule 7(b) hereto, the Company has not
      previously entered into any agreement granting any registration rights with
      respect to any of its securities to any person or entity that have not been
      fully satisfied.

     

    (c)  Compliance.  Each
      Holder covenants and agrees that it will comply with the prospectus delivery
      requirements of the Securities Act as applicable to it in connection with sales
      of Registrable Securities pursuant to any Registration Statement.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (d)  Discontinued
      Disposition.  Each Holder agrees by its acquisition of such
      Registrable Securities that, upon receipt of a notice from the Company of the
      occurrence of a Discontinuation Event (as defined below), such Holder will
      forthwith discontinue disposition of such Registrable Securities under the
      applicable Registration Statement until such Holder’s receipt of the copies of
      the supplemented Prospectus and/or amended Registration Statement or until
      it is
      advised in writing (the “Advice”) by the Company that the use of the
      applicable Prospectus may be resumed, and, in either case, has received copies
      of any additional or supplemental filings that are incorporated or deemed to
      be
      incorporated by reference in such Prospectus or Registration
      Statement.  The Company may provide appropriate stop orders to enforce
      the provisions of this paragraph.  For purposes of this Agreement, a
“Discontinuation Event” shall mean (i) when the Commission notifies the Company
      whether there will be a “review” of such Registration Statement and whenever the
      Commission comments in writing on such Registration Statement (the Company
      shall
      provide true and complete copies thereof and all written responses thereto
      to
      each of the Holders); (ii) any request by the Commission or any other Federal
      or
      state governmental authority for amendments or supplements to such Registration
      Statement or Prospectus or for additional information; (iii) the issuance by
      the
      Commission of any stop order suspending the effectiveness of such Registration
      Statement covering any or all of the Registrable Securities or the initiation
      of
      any Proceedings for that purpose; (iv) the receipt by the Company of any
      notification with respect to the suspension of the qualification or exemption
      from qualification of any of the Registrable Securities for sale in any
      jurisdiction, or the initiation or threatening of any Proceeding for such
      purpose; and/or (v) the occurrence of any event or passage of time that makes
      the financial statements included in such Registration Statement ineligible
      for
      inclusion therein or any statement made in such Registration Statement or
      Prospectus or any document incorporated or deemed to be incorporated therein
      by
      reference untrue in any material respect or that requires any revisions to
      such
      Registration Statement, Prospectus or other documents so that, in the case
      of
      such Registration Statement or Prospectus, as the case may be, it will not
      contain any untrue statement of a material fact or omit to state any material
      fact required to be stated therein or necessary to make the statements therein,
      in light of the circumstances under which they were made, not
      misleading.

     

    (e)  Piggy-Back
      Registrations.  If at any time during the applicable
      Effectiveness Period there is not an effective Registration Statement covering
      all of the Registrable Securities required to be covered during such
      Effectiveness Period and the Company shall determine to prepare and file with
      the Commission a registration statement relating to an offering for its own
      account or the account of others under the Securities Act of any of its equity
      securities, other than on Form S-4 or Form S-8 (each as promulgated under
      the Securities Act) or their then equivalents relating to equity securities
      to
      be issued solely in connection with any acquisition of any entity or business
      or
      equity securities issuable in connection with stock option or other employee
      benefit plans, then the Company shall promptly send to each Holder written
      notice of such determination and, if within fifteen (15) days after receipt
      of
      such notice, any such Holder shall so request in writing, the Company shall
      include in such registration statement all or any part of such Registrable
      Securities such Holder requests to be registered, to the extent the Company
      may
      do so without violating registration rights of others which exist as of the
      date
      of this Agreement, subject to customary underwriter cutbacks applicable to
      all
      holders of registration rights and subject to obtaining any required consent
      of
      any selling stockholder(s) to such inclusion under such registration
      statement.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

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

     

    (g)  Notices.  Any
      notice or request hereunder may be given to the Company or the Investor at
      the
      respective addresses set forth below or as may hereafter be specified in a
      notice designated as a change of address under this Section 7(g).  Any
      notice or request hereunder shall be given by registered or certified mail,
      return receipt requested, hand delivery, overnight mail, Federal Express or
      other national overnight next day carrier (collectively, “Courier”) or
      telecopy (confirmed by mail).  Notices and requests shall be, in the
      case of those by hand delivery, deemed to have been given when delivered to
      any
      party to whom it is addressed, in the case of those by mail or overnight mail,
      deemed to have been given three (3) business days after the date when deposited
      in the mail or with the overnight mail carrier, in the case of a Courier, the
      next business day following timely delivery of the package with the Courier,
      and, in the case of a telecopy, when confirmed.  The address for such
      notices and communications shall be as follows:

     

    
      	
               

            	
              If
                to the Company:

            	
              General
                Environmental Management, Inc.

            

    

    
      	
               

            	
              3191
                Temple Avenue, Suite 250

            

    

    
      	
               

            	
              Pomona,
                CA 91768

            

    

    
      	
               

            	
              Attention:  Chief
                Financial Officer

            

    

    
      	
               

            	
              Facsimile
                No.:  909-444-9900

            

    

     

    
      	
               

            	
              with
                a copy to:

            	
              de
                Castro, P.C.

            

    

    
      	
               

            	
              309
                Laurel Street

            

    

    
      	
               

            	
              San
                Diego, CA 92101

            

    

    
      	
               

            	
              Attention:  Stanley
                Moskowitz

            

    

    
      	
               

            	
              Facsimile
                No.:  619-702-9401

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
               

            	
              If
                to Investor:

            	
              To
                the address set forth under Investor’s name on the signature page
                hereto

            

    

     

    
      	
               

            	
              
                If
                  to any other Person who is

                then
                  the registered Holder:

              

            	
              To
                the address of such Holder as it appears in the stock transfer books
                of
                the Company

            

    

     

    or
      such
      other address as may be designated in writing hereafter in accordance with
      this
      Section 7(g) by such Person.

     

    (h)  Successors
      and Assigns.  This Agreement shall inure to the benefit of
      and be binding upon the successors and permitted assigns of each of the parties
      and shall inure to the benefit of each Holder.  The Company may not
      assign its rights or obligations hereunder without the prior written consent
      of
      each Holder.  Each Holder may assign their respective rights hereunder
      in the manner and to the persons and entities as permitted under the Purchase
      Agreement.

     

    (i)  Execution
      and Counterparts.  This Agreement may be executed in any
      number of counterparts, each of which when so executed shall be deemed to be
      an
      original and, all of which taken together shall constitute one and the same
      agreement.  In the event that any signature is delivered by facsimile
      or electronic transmission, such signature shall create a valid binding
      obligation of the party executing (or on whose behalf such signature is
      executed) the same with the same force and effect as if such facsimile or
      electronic signature were the original thereof.

     

    (j)  Governing
      Law, Jurisdiction and Waiver of Jury Trial.  THIS AGREEMENT
      SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS
      OF
      THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE,
      WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.  The Company hereby
      consents and agrees that the state or federal courts located in the County
      of
      New York, State of New York shall have exclusion jurisdiction to hear and
      determine any Proceeding between the Company, on the one hand, and the Investor,
      on the other hand, pertaining to this Agreement or to any matter arising out
      of
      or related to this Agreement; provided, that the Investor and the Company
      acknowledge that any appeals from those courts may have to be heard by a court
      located outside of the County of New York, State of New York, and
furtherprovided, that nothing in this Agreement shall be deemed or
      operate to preclude the Investor from bringing a Proceeding in any other
      jurisdiction to collect the obligations, to realize on the Collateral or any
      other security for the obligations, or to enforce a judgment or other court
      order in favor of the Investor.  The Company expressly submits and
      consents in advance to such jurisdiction in any Proceeding commenced in any
      such
      court, and the Company hereby waives any objection which it may have based
      upon
      lack of personal jurisdiction, improper venue or forum non
      conveniens.  The Company hereby waives personal service of the
      summons, complaint and other process issued in any such Proceeding and agrees
      that service of such summons, complaint and other process may be made by
      registered or certified mail addressed to the Company at the address set forth
      in Section 7(g) and that service so made shall be deemed completed upon the
      earlier of the Company’s actual receipt thereof or three (3) days after deposit
      in the U.S. mails, proper postage prepaid.  The parties hereto desire
      that their disputes be resolved by a judge applying such applicable
      laws.  Therefore, to achieve the best combination of the benefits of
      the judicial system and of arbitration, the parties hereto waive all rights
      to
      trial by jury in any Proceeding brought to resolve any dispute, whether arising
      in contract, tort, or otherwise between the Investor and/or the Company arising
      out of, connected with, related or incidental to the relationship established
      between then in connection with this Agreement.  If either party
      hereto shall commence a Proceeding to enforce any provisions of this Agreement,
      the Purchase Agreement or any Related Agreement, then the prevailing party
      in
      such Proceeding shall be reimbursed by the other party for its reasonable
      attorneys’ fees and other costs and expenses incurred with the investigation,
      preparation and prosecution of such Proceeding.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

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

     

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

     

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

     

     

    [Balance
      of page intentionally left blank; signature page follows]

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

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

     

    
      
        	 	 	
                GENERAL
                  ENVIRONMENTAL MANAGEMENT, INC., 

                a
                  Nevada
                  corporation

              	 
	 	 	 	 	 
	
                 

              	 	
                By: 
                  

              	
                 

              	 
	
                 

              	 	 	
                Name:

              	 
	
                 

              	 	 	
                Title:

              	 

      

       

      
        	 	 	
                VALENS
                  OFFSHORE SPV II, CORP.

              	 
	 	 	 	 	 
	 	 	
                By: 
                  

              	
                VALENS
                  CAPITAL MANAGEMENT, LLC, 

                its
                  investment manager

              	 
	 	 	 	 	 
	
                 

              	 	
                By: 

              	
                 

              	 
	
                 

              	 	 	
                Name:
                  

              	 
	
                 

              	 	 	
                Title:
                  Authorized Signatory

              	 

      

       

      
        	 	 	Address
                for Notices:	 
	 	 	 	 
	
                 

              	 	335
                Madison Avenue, 10th
                Floor
                
                  New
                    York, NY  10017

                  Attention:  Portfolio
                    Services

                  Facsimile
                    No.:  212-541-4434

                

              	 
	 	 	 	 
	 	 	with
                copy to:	 
	 	 	 	 
	 	 	
                Valens
                  Capital Management, LLC

                335
                  Madison Avenue, 10th Floor

                New
                  York, NY  10017

                Attention:  Portfolio
                  Services

                Facsimile
                  No.:  212-541-4434

              	 

      

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

     

    ____________,
      200___

     

    [Continental
      Stock Transfer

    &
      Trust Company

    Two
      Broadway

    New
      York,
      New York  10004

    Attn:  William
      Seegraber]

     

    
      	
               

            	
              Re:

            	
              General
                Environmental Management, Inc. Registration Statement on Form
                SB-2

            

    

     

    Ladies
      and Gentlemen:

     

    As
      counsel to General Environmental Management, Inc., a Nevada corporation (the
      “Company”), we have been requested to render our opinion to you in
      connection with the resale by the individuals or entitles listed on Schedule
      A attached hereto (the “Selling Stockholders”), of an aggregate of
      __________ shares (the “Shares”) of the Company’s Common
      Stock.

     

    A
      Registration Statement on Form SB-2 under the Securities Act of 1933, as amended
      (the “Act”), with respect to the resale of the Shares was declared
      effective by the Securities and Exchange Commission on
      [date].  Enclosed is the Prospectus dated [date].  We
      understand that the Shares are to be offered and sold in the manner described
      in
      the Prospectus.

     

    Based
      upon the foregoing, upon request by the Selling Stockholders at any time while
      the registration statement remains effective, it is our opinion that the Shares
      have been registered for resale under the Act and new certificates evidencing
      the Shares upon their transfer or re-registration by the Selling Stockholders
      may be issued without restrictive legend.  We will advise you if the
      registration statement is not available or effective at any point in the
      future.

     

    
      
        	 	 	 	
                Very
                  truly yours,

              	 
	 	 	 	 	 
	 	 	 	
                [Company
                  counsel]

              	 

      

       

    

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      Schedule
        A to Exhibit A

       

      
        	
                Selling
                  Stockholder

              	
                R/N/O

              	
                Shares

                Being
                  Offered

              
	 	 	 
	 	 	 
	 	 	 
	 	 	 

      

       

       

       

       

       

       

       

       

       

       

      
 

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

    

     

    SCHEDULE
      7(b)ex_10-8.htm

    
      

      

    

    Exhibit
      10.8

     

     

    REGISTRATION
      RIGHTS AGREEMENT

    
       

       This
        Registration Rights Agreement is made and entered into as of October 31,
        2007
        (as amended, modified or supplemented from time to time, this
“Agreement”) by and between General Environmental Management, Inc., a
        Nevada (the “Company”), and Valens U.S. SPV I, LLC (the
“Investor”).

       

       This
        Agreement is made pursuant to the Securities Purchase Agreement dated as
        of the
        date hereof by and between the Company, the Investor, the other Purchasers
        and
        the LV Administrative Services Corp., as administrative and collateral agent
        for
        the Purchasers (as amended, restated modified and/or supplemented from time
        to
        time, the “Purchase Agreement”).

       

       The
        Company and the Investor hereby agree as follows:

       

      1.            
        Definitions.  Capitalized terms used and not
        otherwise defined herein that are defined in the Purchase Agreement shall
        have
        the meanings given such terms in the Purchase Agreement.  As used in
        this Agreement, the following terms shall have the following
        meanings:

       

      “Commission”
        means the Securities and Exchange Commission.

       

      “Common
        Stock” means shares of the Company’s common stock, par value $0.001 per
        share.

       

      “Company”
        has the meaning given to such term in the Preamble hereto.

       

      “Cut
        Back Registration” has the meaning set forth in Section 2(d).

       

      “Effectiveness
        Date” means, (i) with respect to the initial Registration Statement
        required to be filed in connection with the Notes and the Warrants issued
        on the
        date hereof, a date no later than one hundred eighty (180) days following
        the
        date hereof and (ii) with respect to each additional Registration Statement
        required to be filed hereunder (if any), including a Cut Back Registration,,
        a
        date no later than thirty (30) days following the applicable Filing
        Date.

       

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

       

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

       

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

       

      “Exchange
        Act” means the Securities Exchange Act of 1934, as amended, and any
        successor statute.

       

      “Filing
        Date” means, with respect to (1) the Registration Statement required to be
        filed in connection with the shares of Common Stock issuable to the Holder
        upon
        (x) conversion of the Notes issued as of the date hereof and (y) exercise
        of any
        Warrant issued as of the date hereof, the date which is sixty (60) days
        following the date hereof (subject to the provisions of Section 2(d) hereof),
        (2) the Registration Statement required to be filed in connection with the
        shares of Common Stock issuable to the Holder upon exercise of any Warrant
        issued after the date hereof, the date which is thirty (30) days after the
        issuance of such Warrant and (3) the Registration Statement required to be
        filed
        in connection with the shares of Common Stock issuable to the Holder as a
        result
        of adjustments to (x) the Fixed Conversion Price made pursuant to Section
        3.6 of
        the Notes, or (y) the Exercise Price made pursuant to Section 4 of the Warrant,
        or otherwise, thirty (30) days after the occurrence of such event or the
        date of
        the adjustment of the Fixed Conversion Price or Exercise Price, as
        applicable.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      “Holder”
        or “Holders” means the Investor or any of its affiliates or transferees
        to the extent any of them hold Registrable Securities, other than those
        purchasing Registrable Securities in a market transaction.

       

      “Indemnified
        Party” has the meaning set forth in Section 5(c).

       

      “Indemnifying
        Party” has the meaning set forth in Section 5(c).

       

      “Notes”
        has the meaning given to the term in the Purchase Agreement.

       

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

       

      “Prospectus”
        means the prospectus included in a Registration Statement (including, without
        limitation, a prospectus that includes any information previously omitted
        from a
        prospectus filed as part of an effective registration statement in reliance
        upon
        Rule 430A promulgated under the Securities Act), as amended or supplemented
        by
        any prospectus supplement, with respect to the terms of the offering of any
        portion of the Registrable Securities covered by such Registration Statement,
        and all other amendments and supplements to the Prospectus, including
        post-effective amendments, and all material incorporated by reference or
        deemed
        to be incorporated by reference in such Prospectus.

       

      “Purchase
        Agreement” has the meaning given to such term in the Preamble
        hereto.

       

      “Registrable
        Securities” means the shares of Common Stock issuable upon conversion of
        the Notes and exercise of the Warrants.

       

      “Registration
        Statement” means each registration statement required to be filed
        hereunder, including the Prospectus therein, amendments and supplements to
        such
        registration statement or Prospectus, including pre- and post-effective
        amendments, all exhibits thereto, and all material incorporated by reference
        or
        deemed to be incorporated by reference in such registration
        statement.

       

      “Rule
        144” means Rule 144 promulgated by the Commission pursuant to the
        Securities Act, as such Rule may be amended from time to time, or any similar
        rule or regulation hereafter adopted by the Commission having substantially
        the
        same effect as such Rule.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      “Rule
        415” means Rule 415 promulgated by the Commission pursuant to the
        Securities Act, as such Rule may be amended from time to time, or any similar
        rule or regulation hereafter adopted by the Commission having substantially
        the
        same effect as such Rule.

       

      “Securities
        Act” means the Securities Act of 1933, as amended, and any successor
        statute.

       

      “Trading
        Market” means any of the NASD Over The Counter Bulletin Board, NASDAQ
        Capital Market, the NASDAQ Global Market, the American Stock Exchange or
        the New
        York Stock Exchange.

       

      “Warrants”
        means the Common Stock purchase warrants issued in connection with the Purchase
        Agreement, whether on the date thereof or thereafter.

       

      2.            
        Registration.

       

      (a)           On
        or prior to each Filing Date, the Company shall prepare and file with the
        Commission a Registration Statement covering the Registrable Securities for
        a
        selling stockholder resale offering to be made on a continuous basis pursuant
        to
        Rule 415.  Each Registration Statement shall be on Form S-3 (except if
        the Company is not then eligible to register for resale the Registrable
        Securities on Form S-3, in which case such registration shall be on another
        appropriate form in accordance herewith).  The Company shall cause
        each Registration Statement to become effective and remain effective as provided
        herein.  The Company shall use its best efforts to cause each
        Registration Statement to be declared effective under the Securities Act
        as
        promptly as possible after the filing thereof, but in any event no later
        than
        the Effectiveness Date.  The Company shall use its best efforts to
        keep each Registration Statement continuously effective under the Securities
        Act
        until the date which is the earlier date of when (i) all Registrable Securities
        covered by such Registration Statement have been sold or (ii) all Registrable
        Securities covered by such Registration Statement may be sold immediately
        without registration under the Securities Act and without volume restrictions
        pursuant to Rule 144(k), as determined by the counsel to the Company pursuant
        to
        a written opinion letter to such effect, addressed and acceptable to the
        Company’s transfer agent and the affected Holders (each, an “Effectiveness
        Period”).

       

      (b)           If:
        (i) the Registration Statement is not filed on or prior to the Filing Date;
        (ii)
        the Registration Statement is not declared effective by the Commission by
        the
        Effectiveness Date; (iii) after the Registration Statement is filed with
        and
        declared effective by the Commission, the Registration Statement ceases to
        be
        effective (by suspension or otherwise) as to all Registrable Securities to
        which
        it is required to relate at any time prior to the expiration of the
        Effectiveness Period (without being succeeded immediately by an additional
        registration statement filed and declared effective) for a period of time
        which
        shall exceed 30 days in the aggregate per year or more than 20 consecutive
        calendar days (defined as a period of 365 days commencing on the date the
        Registration Statement is declared effective); or (iv) the Common Stock is
        not
        listed or quoted, or is suspended from trading on any Trading Market for
        a
        period of three (3) consecutive Trading Days (provided the Company shall
        not
        have been able to cure such trading suspension within 30 days of the notice
        thereof or list the Common Stock on another Trading Market); (any such failure
        or breach being referred to as an “Event,” and for purposes of clause (i) or
        (ii) the date on which such Event occurs, or for purposes of clause (iii)
        the
        date which such 30 day or 20 consecutive day period (as the case may be)
        is
        exceeded, or for purposes of clause (iv) the date on which such three (3)
        Trading Day period is exceeded, being referred to as “Event Date”), then
        until the applicable Event is cured, the Company shall pay to each Holder
        an
        amount in cash, as liquidated damages and not as a penalty, equal to 2.0%
        for
        each thirty (30) day period (prorated for partial periods) on a daily basis
        of
        the original principal amount of the Note.  While such Event
        continues, such liquidated damages shall be paid not less often than each
        thirty
        (30) days.  Any unpaid liquidated damages as of the date when an Event
        has been cured by the Company shall be paid within three (3) days following
        the
        date on which such Event has been cured by the Company.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (c)           Within
        three (3) business days of the Effectiveness Date, the Company shall cause
        its
        counsel to issue a blanket opinion in the form attached hereto as Exhibit
        A, to
        the transfer agent stating that the shares are subject to an effective
        registration statement and can be reissued free of restrictive legend upon
        notice of a sale by the Investor and confirmation by the Investor that it
        has
        complied with the prospectus delivery requirements, provided that the
        Company has not advised the transfer agent orally or in writing that the
        opinion
        has been withdrawn. Copies of the blanket opinion required by this Section
        2(c)
        shall be delivered to the Investor within the time frame set forth
        above.

       

      (d)           Notwithstanding
        the other provisions of this Agreement, 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, 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 (collectively,
        the “SEC Restrictions”). Any cut-back imposed pursuant to this Section 2(d)
        shall be allocated among the Investor and any other selling security holder
        holding shares that are not eligible to be made on a delayed or continuous
        basis
        under the provisions of Rule 415, on a pro-rata basis, unless the SEC
        Restrictions otherwise require.  The Company shall file a Registration
        Statement covering the Cut Back Shares (a "Cut Back Registration") within
        thirty
        (30) days after the date on which the SEC declares the initial Registration
        Statement effective, or April 30, 2008 which ever date is earlier, as the
        SEC
        may mandate (the "Cut Back Filing Date") and shall cause such Registration
        Statement to become effective by the applicable Effectiveness
        Date.  No damages shall accrue on or as to any Cut Back Shares unless
        and until the Company has failed to meet the Cut Back Filing Date or the
        applicable Effectiveness Date.

       

      3.            
        Registration Procedures.  If and whenever the
        Company is required by the provisions hereof to effect the registration of
        any
        Registrable Securities under the Securities Act, the Company will, as
        expeditiously as possible:

       

      (a)           prepare
        and file with the Commission a Registration Statement with respect to such
        Registrable Securities, respond as promptly as possible to any comments received
        from the Commission, and use its best efforts to cause such Registration
        Statement to become and remain effective for the Effectiveness Period with
        respect thereto, and promptly provide to the Investor copies of all filings
        and
        Commission letters of comment relating thereto and before filing a Registration
        Statement or Prospectus or any amendments or supplements thereto, furnish
        to the
Investor copies of all such
        documents proposed to be filed, including documents incorporated by reference
        in
        the Prospectus and, if requested by the Investor, the exhibits incorporated
        by
        reference, and the Investor shall have the opportunity
        to object to
        any information pertaining to itself that is contained therein and the
        Company will make the corrections reasonably requested by the
Investor with respect to
        such information prior to filing any Registration Statement or amendment
        thereto
        or any Prospectus or any supplement thereto;

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      (b)           prepare
        and file with the Commission such amendments and supplements to such
        Registration Statement and the Prospectus used in connection therewith as
        may be
        necessary to comply with the provisions of the Securities Act with respect
        to
        the disposition of all Registrable Securities covered by such Registration
        Statement and to keep such Registration Statement effective until the expiration
        of the Effectiveness Period applicable to such Registration
        Statement;

       

      (c)           furnish
        to the Investor such number of copies of the Registration Statement and the
        Prospectus included therein (including each preliminary Prospectus and any
        amendments and supplements to the Registration Statement and the Prospectus)
        and
        such other documents as the Investor reasonably may request to facilitate
        the
        public sale or disposition of the Registrable Securities covered by such
        Registration Statement;

       

      (d)           use
        its best efforts to register or qualify the Investor’s Registrable Securities
        covered by such Registration Statement under the securities or “blue sky” laws
        of such jurisdictions within the United States as the Investor may reasonably
        request and do any and all other acts and things which may be reasonably
        necessary or advisable to enable the Investor to consummate the disposition
        in
        such jurisdiction of the Registrable Securities, provided,
however, that the Company shall not for any such purpose be required
        to
        qualify generally to transact business as a foreign corporation in any
        jurisdiction where it is not so qualified or to consent to general service
        of
        process in any such jurisdiction;

       

      (e)           immediately
        notify the Investor at any time when a Prospectus relating thereto is required
        to be delivered under the Securities Act, of the happening of any event as
        a
        result of which the Prospectus contained in such Registration Statement,
        as then
        in effect, includes an untrue statement of a material fact or omits to state
        a
        material fact required to be stated therein or necessary to make the statements
        therein not misleading, and, at the request of the Investor, the Company
        shall
        prepare a supplement or amendment to such Prospectus so that, as thereafter
        delivered to the purchasers of Registrable Securities, such Prospectus shall
        not
        contain an untrue statement of a material fact or omit to state any material
        fact required to be stated therein or necessary to make the statement therein
        not misleading;

       

      (f)           make
        available for inspection by the Investor and any attorney, accountant or
        other
        agent retained by the Investor, all publicly available, non-confidential
        financial and other records, pertinent corporate documents and properties
        of the
        Company, and cause the Company’s officers, directors and employees to supply all
        publicly available, non-confidential information reasonably requested by
        the
        attorney, accountant or agent of the Investor;

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      (g)           provide
        a transfer agent and registrar for all such Registrable Securities not later
        than the effective date of such Registration Statement;

       

      (h)           if
        requested, cause to be delivered, immediately prior to the effectiveness
        of the
        Registration Statement, letters from the Company’s independent certified public
        accountants addressed to the Investor (unless the Investor does not provide
        to
        such accountants the appropriate representation letter required by rules
        governing the accounting profession) stating that such accountants are
        independent public accountants within the meaning of the Securities Act and
        the
        applicable rules and regulations adopted by the Commission thereunder, and
        otherwise in customary form and covering such financial and accounting matters
        as are customarily covered by letters of the independent certified public
        accountants delivered in connection with primary or secondary underwritten
        public offerings, as the case may be;

       

      (i)           at
        all times after the Company has filed a Registration Statement with the
        Commission pursuant to the requirements of either the Securities Act or the
        Exchange Act, the Company shall file all reports required to be filed by
        it
        under the Securities Act and the Exchange Act and the rules and regulations
        adopted by the Commission thereunder, and take such further action as the
        Investor may reasonably request, all to the extent required to enable the
        Investor to be eligible to sell Registrable Securities pursuant to Rule 144
        (or
        any similar rule then in effect); and

       

      (j)           notify
        the Holder if the Company receives a comment, verbal or written, from the
        SEC to
        the effect that the offering of some or all of the Registrable Securities
        cannot
        be made on a delayed or continuous basis under the provisions of Rule 415
        and
        provide the Holder’s counsel an opportunity to comment upon the Company’s
        proposed response to such comment.

       

      4.            
        Registration Expenses.  All expenses relating
        to the Company’s compliance with Sections 2 and 3 hereof, including, without
        limitation, all registration, filing and listing application fees, costs
        of
        distributing any prospectuses and supplements thereto, printing expenses,
        fees
        and disbursements of counsel and independent public accountants for the Company,
        fees and expenses (including counsel fees) incurred in connection with complying
        with state securities or “blue sky” laws, fees of the NASD, transfer taxes, fees
        of transfer agents and registrars, fees of, and disbursements incurred by,
        one
        counsel for the Holders are called “Registration Expenses.” All selling
        commissions applicable to the sale of Registrable Securities, including any
        fees
        and disbursements of any special counsel to the Holders beyond those included
        in
        Registration Expenses, are called “Selling Expenses.”  The Company
        shall only be responsible for all Registration Expenses.  The
        obligation of the Company to bear the expenses
        described  above  shall apply irrespective of whether a
        registration, becomes effective, is withdrawn or suspended, is converted
        to
        another form of registration and irrespective of when any of the foregoing
        shall
        occur.

       

      5.            
        Indemnification.

       

      (a)           In
        the event of a registration of any Registrable Securities under the Securities
        Act pursuant to this Agreement, the Company will indemnify and hold harmless
        each Holder, and its officers, directors and each other person, if any, who
        controls such Holder within the meaning of the Securities Act, against any
        losses, claims, damages or liabilities, joint or several, to which such Holder,
        or such persons may become subject under the Securities Act or otherwise,
        insofar as such losses, claims, damages or liabilities (or actions in respect
        thereof) arise out of or are based upon any untrue statement or alleged untrue
        statement of any material fact contained in any Registration Statement under
        which such Registrable Securities were registered under the Securities Act
        pursuant to this Agreement, any preliminary Prospectus or final Prospectus
        contained therein, or any amendment or supplement thereof, or arise out of
        or
        are based upon the omission or alleged omission to state therein a material
        fact
        required to be stated therein or necessary to make the statements therein
        not
        misleading or any violation or alleged violation by the Company of the
        Securities Act, the Exchange Act or applicable “blue sky” laws, and will
        reimburse such Holder, and each such person for any legal or other expenses
        incurred by them in connection with investigating or defending any such loss,
        claim, damage, liability or action; 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 an untrue
        statement or alleged untrue statement or omission or alleged omission so
        made in
        conformity with information furnished by or on behalf of the Investor or
        any
        such person in writing specifically for use in any such document.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      (b)           In
        the event of a registration of the Registrable Securities under the Securities
        Act pursuant to this Agreement, the Investor will indemnify and hold harmless
        the Company, and its officers, directors and each other person, if any, who
        controls the Company within the meaning of the Securities Act, against all
        losses, claims, damages or liabilities, joint or several, to which the Company
        or such persons may become subject under the Securities Act or otherwise,
        insofar as such losses, claims, damages or liabilities (or actions in respect
        thereof) arise out of or are based upon any untrue statement or alleged untrue
        statement of any material fact which was furnished in writing by the Investor
        to
        the Company expressly for use in (and such information is contained in) the
        Registration Statement under which such Registrable Securities were registered
        under the Securities Act pursuant to this Agreement, any preliminary Prospectus
        or final Prospectus contained therein, or any amendment or supplement thereof,
        or arise out of or are based upon the omission or alleged omission to state
        therein a material fact required to be stated therein or necessary to make
        the
        statements therein not misleading, and will reimburse the Company and each
        such
        person for any reasonable legal or other expenses incurred by them in connection
        with investigating or defending any such loss, claim, damage, liability or
        action, provided, however, that the Investor will be liable in any
        such case if and only to the extent that any such loss, claim, damage or
        liability arises out of or is based upon an untrue statement or alleged untrue
        statement or omission or alleged omission so made in conformity with information
        furnished in writing to the Company by or on behalf of the Investor specifically
        for use in any such document.  Notwithstanding the provisions of this
        paragraph, the Investor shall not be required to indemnify any person or
        entity
        in excess of the amount of the aggregate net proceeds received by the Investor
        in respect of Registrable Securities in connection with any such registration
        under the Securities Act.

       

      (c)           Promptly
        after receipt by a party entitled to claim indemnification hereunder (an
        “Indemnified Party”) of notice of the commencement of any action, such
        Indemnified Party shall, if a claim for indemnification in respect thereof
        is to
        be made against a party hereto obligated to indemnify such Indemnified Party
        (an
“Indemnifying Party”), notify the Indemnifying Party in writing thereof,
        but the omission so to notify the Indemnifying Party shall not relieve it
        from
        any liability which it may have to such Indemnified Party other than under
        this
        Section 5(c) and shall only relieve it from any liability which it may have
        to
        such Indemnified Party under this Section 5(c) if and to the extent the
        Indemnifying Party is prejudiced by such omission. In case any such action
        shall
        be brought against any Indemnified Party and it shall notify the Indemnifying
        Party of the commencement thereof, the Indemnifying Party shall be entitled
        to
        participate in and, to the extent it shall wish, to assume and undertake
        the
        defense thereof with counsel satisfactory to such Indemnified Party, and,
        after
        notice from the Indemnifying Party to such Indemnified Party of its election
        so
        to assume and undertake the defense thereof, the Indemnifying Party shall
        not be
        liable to such Indemnified Party under this Section 5(c) for any legal expenses
        subsequently incurred by such Indemnified Party in connection with the defense
        thereof; if the Indemnified Party retains its own counsel, then the Indemnified
        Party shall pay all fees, costs and expenses of such counsel, provided,
however, that, if the defendants in any such action include both
        the
        Indemnified Party and the Indemnifying Party and the Indemnified Party shall
        have reasonably concluded that there may be reasonable defenses available
        to it
        which are different from or additional to those available to the Indemnifying
        Party or if the interests of the Indemnified Party reasonably may be deemed
        to
        conflict with the interests of the Indemnifying Party, the Indemnified Party
        shall have the right to select one separate counsel and to assume such legal
        defenses and otherwise to participate in the defense of such action, with
        the
        reasonable expenses and fees of such separate counsel and other expenses
        related
        to such participation to be reimbursed by the Indemnifying Party as
        incurred.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      (d)           In
        order to provide for just and equitable contribution in the event of joint
        liability under the Securities Act in any case in which either (i) the Investor,
        or any officer, director or controlling person of the Investor, makes a claim
        for indemnification pursuant to this Section 5 but it is judicially determined
        (by the entry of a final judgment or decree by a court of competent jurisdiction
        and the expiration of time to appeal or the denial of the last right of appeal)
        that such indemnification may not be enforced in such case notwithstanding
        the
        fact that this Section 5 provides for indemnification in such case, or (ii)
        contribution under the Securities Act may be required on the part of the
        Investor or such officer, director or controlling person of the Investor
        in
        circumstances for which indemnification is provided under this Section 5;
        then,
        and in each such case, the Company and the Investor will contribute to the
        aggregate losses, claims, damages or liabilities to which they may be subject
        (after contribution from others) in such proportion so that the Investor
        is
        responsible only for the portion represented by the percentage that the public
        offering price of its securities offered by the Registration Statement bears
        to
        the public offering price of all securities offered by such Registration
        Statement, provided, however, that, in any such case, (A) the
        Investor will not be required to contribute any amount in excess of the public
        offering price of all such securities offered by it pursuant to such
        Registration Statement; and (B) no person or entity guilty of fraudulent
        misrepresentation (within the meaning of Section 10(f) of the Act) will be
        entitled to contribution from any person or entity who was not guilty of
        such
        fraudulent misrepresentation.

       

      (e)           The
        indemnification provided for under this Agreement shall remain in full force
        and
        effect regardless of any investigation made by or on behalf of the indemnified
        party or any officer, director or controlling Person of such indemnified
        party
        and shall survive the transfer of securities.

       

      6.            
        Representations and Warranties.

       

      (a)           The
        Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
        Act and, except with respect to certain matters which the Company has disclosed
        to the Investor on Schedule 4.21 to the Purchase Agreement, the Company
        has timely filed all proxy statements, reports, schedules, forms, statements
        and
        other documents required to be filed by it under the Exchange
        Act.  The Company has filed (i) its Annual Report on Form 10-KSB for
        its fiscal year ended December 31, 2006 and (ii) its Quarterly Report on
        Form
        10-QSB for the fiscal quarters ended March 31, 2007 and June 30, 2007
        (collectively, the “SEC Reports”).  Each SEC Report was, at the time
        of its filing, in substantial compliance with the requirements of its respective
        form and none of the SEC Reports, nor the financial statements (and the notes
        thereto) included in the SEC Reports, as of their respective filing dates,
        contained any untrue statement of a material fact or omitted 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.  The financial statements of the Company included in the
        SEC Reports comply as to form in all material respects with applicable
        accounting requirements and the published rules and regulations of the
        Commission or other applicable rules and regulations with respect
        thereto.  Such financial statements have been prepared in accordance
        with generally accepted accounting principles (“GAAP”) applied on a
        consistent basis during the periods involved (except (i) as may be otherwise
        indicated in such financial statements or the notes thereto or (ii) in the
        case
        of unaudited interim statements, to the extent they may not include footnotes
        or
        may be condensed) and fairly present in all material respects the financial
        condition, the results of operations and the cash flows of the Company and
        its
        subsidiaries, on a consolidated basis, as of, and for, the periods presented
        in
        each such SEC Report.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      (b)           The
        Common Stock is listed or quoted, as applicable, for trading on the NASDAQ
        Over
        The Counter Bulletin Board and satisfies all requirements for the continuation
        of such listing or quotation, as applicable, and the Company shall do all
        things
        necessary for the continuation of such listing or quotation, as
        applicable.  The Company has not received any notice that its Common
        Stock will be delisted from or no longer be quoted on, as applicable, the
        NASDAQ
        Over The Counter Bulletin Board (except for prior notices which have been
        fully
        remedied) or that the Common Stock does not meet all requirements for the
        continuation of such listing or quotation, as applicable.

       

      (c)           Neither
        the Company, nor any of its affiliates, nor any person acting on its or their
        behalf, has directly or indirectly made any offers or sales of any security
        or
        solicited any offers to buy any security under circumstances that would cause
        the offering of the Securities pursuant to the Purchase Agreement to be
        integrated with prior offerings by the Company for purposes of the Securities
        Act which would prevent the Company from selling the Common Stock pursuant
        to
        Rule 506 under the Securities Act, or any applicable exchange-related
        stockholder approval provisions, nor will the Company or any of its affiliates
        or subsidiaries take any action or steps that would cause the offering of
        the
        Securities to be integrated with other offerings (other than such concurrent
        offering to the Investor).

       

      (d)           The
        Warrants and the shares of Common Stock that the Investor may acquire pursuant
        to the Warrants are all restricted securities under the Securities Act as
        of the
        date of this Agreement.  The Company will not issue any stop transfer
        order or other order impeding the sale and delivery of any of the Registrable
        Securities at such time as such Registrable Securities are registered for
        public
        sale or an exemption from registration is available, except as required by
        federal or state securities laws.

       

      (e)           The
        Company understands the nature of the Registrable Securities issuable upon
        the
        conversion of each Note and exercise of each Warrant and recognizes that
        the
        issuance of such Registrable Securities may have a potential dilutive
        effect.  The Company specifically acknowledges that its obligation to
        issue the Registrable Securities is binding upon the Company and enforceable
        regardless of the dilution such issuance may have on the ownership interests
        of
        other shareholders of the Company.

       

      (f)           Except
        for agreements made in the ordinary course of business, there is no agreement
        that has not been filed with the Commission as an exhibit to a registration
        statement or to a form required to be filed by the Company under the Exchange
        Act, the breach of which could reasonably be expected to have a material
        and
        adverse effect on the Company and its subsidiaries, or would prohibit or
        otherwise interfere with the ability of the Company to enter into and perform
        any of its obligations under this Agreement in any material
        respect.

       

      (g)           The
        Company will at all times have authorized and reserved a sufficient number
        of
        shares of Common Stock for the full conversion of the Notes and exercise
        of the
        Warrants.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      (h)           The
        Company shall provide written notice to each Holder of (i) the occurrence
        of
        each Discontinuation Event (as defined below) and (ii) the declaration of
        effectiveness by the Commission of each Registration Statement required to
        be
        filed hereunder, in each case within one (1) business day of the date of
        each
        such occurrence and/or declaration.

       

      7.            
        Miscellaneous.

       

      (a)           Remedies.  In
        the event of a breach by the Company or by a Holder, of any of their respective
        obligations under this Agreement, each Holder or the Company, as the case
        may
        be, in addition to being entitled to exercise all rights granted by law and
        under this Agreement, including recovery of damages, will be entitled to
        specific performance of its rights under this Agreement.

       

      (b)           No
        Piggyback on Registrations.  Except as and to the extent set
        forth on Schedule 7(b) hereto, neither the Company nor any of its security
        holders (other than the Holders in such capacity pursuant hereto) may include
        securities of the Company in any Registration Statement other than the
        Registrable Securities, and the Company shall not after the date hereof enter
        into any agreement providing any such right for inclusion of shares in the
        Registration Statement to any of its security holders.  Except as and
        to the extent specified in Schedule 7(b) hereto, the Company has not
        previously entered into any agreement granting any registration rights with
        respect to any of its securities to any person or entity that have not been
        fully satisfied.

       

      (c)           Compliance.  Each
        Holder covenants and agrees that it will comply with the prospectus delivery
        requirements of the Securities Act as applicable to it in connection with
        sales
        of Registrable Securities pursuant to any Registration Statement.

       

      (d)           Discontinued
        Disposition.  Each Holder agrees by its acquisition of such
        Registrable Securities that, upon receipt of a notice from the Company of
        the
        occurrence of a Discontinuation Event (as defined below), such Holder will
        forthwith discontinue disposition of such Registrable Securities under the
        applicable Registration Statement until such Holder’s receipt of the copies of
        the supplemented Prospectus and/or amended Registration Statement or until
        it is
        advised in writing (the “Advice”) by the Company that the use of the
        applicable Prospectus may be resumed, and, in either case, has received copies
        of any additional or supplemental filings that are incorporated or deemed
        to be
        incorporated by reference in such Prospectus or Registration
        Statement.  The Company may provide appropriate stop orders to enforce
        the provisions of this paragraph.  For purposes of this Agreement, a
“Discontinuation Event” shall mean (i) when the Commission notifies the Company
        whether there will be a “review” of such Registration Statement and whenever the
        Commission comments in writing on such Registration Statement (the Company
        shall
        provide true and complete copies thereof and all written responses thereto
        to
        each of the Holders); (ii) any request by the Commission or any other Federal
        or
        state governmental authority for amendments or supplements to such Registration
        Statement or Prospectus or for additional information; (iii) the issuance
        by the
        Commission of any stop order suspending the effectiveness of such Registration
        Statement covering any or all of the Registrable Securities or the initiation
        of
        any Proceedings for that purpose; (iv) the receipt by the Company of any
        notification with respect to the suspension of the qualification or exemption
        from qualification of any of the Registrable Securities for sale in any
        jurisdiction, or the initiation or threatening of any Proceeding for such
        purpose; and/or (v) the occurrence of any event or passage of time that makes
        the financial statements included in such Registration Statement ineligible
        for
        inclusion therein or any statement made in such Registration Statement or
        Prospectus or any document incorporated or deemed to be incorporated therein
        by
        reference untrue in any material respect or that requires any revisions to
        such
        Registration Statement, Prospectus or other documents so that, in the case
        of
        such Registration Statement or Prospectus, as the case may be, it will not
        contain any untrue statement of a material fact or omit to state any material
        fact required to be stated therein or necessary to make the statements therein,
        in light of the circumstances under which they were made, not
        misleading.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      (e)           Piggy-Back
        Registrations.  If at any time during the applicable
        Effectiveness Period there is not an effective Registration Statement covering
        all of the Registrable Securities required to be covered during such
        Effectiveness Period and the Company shall determine to prepare and file
        with
        the Commission a registration statement relating to an offering for its own
        account or the account of others under the Securities Act of any of its equity
        securities, other than on Form S-4 or Form S-8 (each as promulgated under
        the Securities Act) or their then equivalents relating to equity securities
        to
        be issued solely in connection with any acquisition of any entity or business
        or
        equity securities issuable in connection with stock option or other employee
        benefit plans, then the Company shall promptly send to each Holder written
        notice of such determination and, if within fifteen (15) days after receipt
        of
        such notice, any such Holder shall so request in writing, the Company shall
        include in such registration statement all or any part of such Registrable
        Securities such Holder requests to be registered, to the extent the Company
        may
        do so without violating registration rights of others which exist as of the
        date
        of this Agreement, subject to customary underwriter cutbacks applicable to
        all
        holders of registration rights and subject to obtaining any required consent
        of
        any selling stockholder(s) to such inclusion under such registration
        statement.

       

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

       

      (g)          Notices.  Any
        notice or request hereunder may be given to the Company or the Investor at
        the
        respective addresses set forth below or as may hereafter be specified in
        a
        notice designated as a change of address under this Section 7(g).  Any
        notice or request hereunder shall be given by registered or certified mail,
        return receipt requested, hand delivery, overnight mail, Federal Express
        or
        other national overnight next day carrier (collectively, “Courier”) or
        telecopy (confirmed by mail).  Notices and requests shall be, in the
        case of those by hand delivery, deemed to have been given when delivered
        to any
        party to whom it is addressed, in the case of those by mail or overnight
        mail,
        deemed to have been given three (3) business days after the date when deposited
        in the mail or with the overnight mail carrier, in the case of a Courier,
        the
        next business day following timely delivery of the package with the Courier,
        and, in the case of a telecopy, when confirmed.  The address for such
        notices and communications shall be as follows:

       

      
        	
                 

              	
                If
                  to the Company:

              	
                General
                  Environmental Management, Inc.

              

      

      
        	
                 

              	
                3191
                  Temple Avenue, Suite 250

              

      

      
        	
                 

              	
                Pomona,
                  CA 91768

              

      

      
        	
                 

              	
                Attention:  Chief
                  Financial Officer

              

      

      
        	
                 

              	
                Facsimile
                  No.:  909-444-9900

              

      

       

      
        	
                 

              	
                with
                  a copy to:

              	
                de
                  Castro, P.C.

              

      

      
        	
                 

              	
                309
                  Laurel Street

              

      

      
        	
                 

              	
                San
                  Diego, CA 92101

              

      

      
        	
                 

              	
                Attention:  Stanley
                  Moskowitz

              

      

      
        	
                 

              	
                Facsimile
                  No.:  619-702-9401

              

      

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                If
                  to Investor:

              	
                To
                  the address set forth under Investor’s name on the signature page
                  hereto

              

      

       

      
        	
                 

              	
                
                  
                    If
                      to any other Person who is

                    then
                      the registered Holder:

                  

                

              	
                 

                To
                  the address of such Holder as it appears in the stock transfer
                  books of
                  the Company

              

      

       

      or
        such
        other address as may be designated in writing hereafter in accordance with
        this
        Section 7(g) by such Person.

       

      (h)          Successors
        and Assigns.  This Agreement shall inure to the benefit of
        and be binding upon the successors and permitted assigns of each of the parties
        and shall inure to the benefit of each Holder.  The Company may not
        assign its rights or obligations hereunder without the prior written consent
        of
        each Holder.  Each Holder may assign their respective rights hereunder
        in the manner and to the persons and entities as permitted under the Purchase
        Agreement.

       

      (i)           Execution
        and Counterparts.  This Agreement may be executed in any
        number of counterparts, each of which when so executed shall be deemed to
        be an
        original and, all of which taken together shall constitute one and the same
        agreement.  In the event that any signature is delivered by facsimile
        or electronic transmission, such signature shall create a valid binding
        obligation of the party executing (or on whose behalf such signature is
        executed) the same with the same force and effect as if such facsimile or
        electronic signature were the original thereof.

       

      (j)           Governing
        Law, Jurisdiction and Waiver of Jury Trial.  THIS AGREEMENT
        SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS
        OF
        THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH
        STATE,
        WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.  The Company hereby
        consents and agrees that the state or federal courts located in the County
        of
        New York, State of New York shall have exclusion jurisdiction to hear and
        determine any Proceeding between the Company, on the one hand, and the Investor,
        on the other hand, pertaining to this Agreement or to any matter arising
        out of
        or related to this Agreement; provided, that the Investor and the Company
        acknowledge that any appeals from those courts may have to be heard by a
        court
        located outside of the County of New York, State of New York, and
furtherprovided, that nothing in this Agreement shall be deemed or
        operate to preclude the Investor from bringing a Proceeding in any other
        jurisdiction to collect the obligations, to realize on the Collateral or
        any
        other security for the obligations, or to enforce a judgment or other court
        order in favor of the Investor.  The Company expressly submits and
        consents in advance to such jurisdiction in any Proceeding commenced in any
        such
        court, and the Company hereby waives any objection which it may have based
        upon
        lack of personal jurisdiction, improper venue or forum non
        conveniens.  The Company hereby waives personal service of the
        summons, complaint and other process issued in any such Proceeding and agrees
        that service of such summons, complaint and other process may be made by
        registered or certified mail addressed to the Company at the address set
        forth
        in Section 7(g) and that service so made shall be deemed completed upon the
        earlier of the Company’s actual receipt thereof or three (3) days after deposit
        in the U.S. mails, proper postage prepaid.  The parties hereto desire
        that their disputes be resolved by a judge applying such applicable
        laws.  Therefore, to achieve the best combination of the benefits of
        the judicial system and of arbitration, the parties hereto waive all rights
        to
        trial by jury in any Proceeding brought to resolve any dispute, whether arising
        in contract, tort, or otherwise between the Investor and/or the Company arising
        out of, connected with, related or incidental to the relationship established
        between then in connection with this Agreement.  If either party
        hereto shall commence a Proceeding to enforce any provisions of this Agreement,
        the Purchase Agreement or any Related Agreement, then the prevailing party
        in
        such Proceeding shall be reimbursed by the other party for its reasonable
        attorneys’ fees and other costs and expenses incurred with the investigation,
        preparation and prosecution of such Proceeding.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

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

       

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

       

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

       

       

      [Balance
        of page intentionally left blank; signature page follows]

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

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

       

      
        	 	 	
                GENERAL
                  ENVIRONMENTAL MANAGEMENT, INC., 

                a
                  Nevada
                  corporation

              	 
	 	 	 	 	 
	
                 

              	 	
                By: 
                  

              	
                 

              	 
	
                 

              	 	 	
                Name:

              	 
	
                 

              	 	 	
                Title:

              	 

      

       

      
        	 	 	VALENS
                U.S. SPV I,
                LLC	 
	 	 	 	 	 
	 	 	
                By: 
                  

              	
                VALENS
                  CAPITAL MANAGEMENT, LLC, 

                its
                  investment manager

              	 
	 	 	 	 	 
	
                 

              	 	
                By: 

              	
                 

              	 
	
                 

              	 	 	
                Name:
                  

              	 
	
                 

              	 	 	
                Title:
                  Authorized Signatory

              	 

      

       

      
        	 	 	 Address
                for
                Notices:	 
	 	 	 	 
	
                 

              	 	335
                Madison Avenue, 10th
                Floor
                
                  New
                    York, NY  10017

                  Attention:  Portfolio
                    Services

                  Facsimile
                    No.:  212-541-4434

                

              	 
	 	 	 	 
	 	 	with
                copy to:	 
	 	 	 	 
	 	 	Valens
                Capital Management, LLC
                335
                  Madison Avenue, 10th Floor

                New
                  York, NY  10017

                Attention:  Portfolio
                  Services

                Facsimile
                  No.:  212-541-4434

              	 

      

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A

       

      ____________,
        200___

       

      [Continental
        Stock Transfer

      &
        Trust Company

      Two
        Broadway

      New
        York,
        New York  10004

      Attn:  William
        Seegraber]

       

      
        	
                 

              	
                Re:

              	
                General
                  Environmental Management, Inc. Registration Statement on Form
                  SB-2

              

      

       

      Ladies
        and Gentlemen:

       

      As
        counsel to General Environmental Management, Inc., a Nevada corporation (the
        “Company”), we have been requested to render our opinion to you in
        connection with the resale by the individuals or entitles listed on Schedule
        A attached hereto (the “Selling Stockholders”), of an aggregate of
        __________ shares (the “Shares”) of the Company’s Common
        Stock.

       

      A
        Registration Statement on Form SB-2 under the Securities Act of 1933, as
        amended
        (the “Act”), with respect to the resale of the Shares was declared
        effective by the Securities and Exchange Commission on
        [date].  Enclosed is the Prospectus dated [date].  We
        understand that the Shares are to be offered and sold in the manner described
        in
        the Prospectus.

       

      Based
        upon the foregoing, upon request by the Selling Stockholders at any time
        while
        the registration statement remains effective, it is our opinion that the
        Shares
        have been registered for resale under the Act and new certificates evidencing
        the Shares upon their transfer or re-registration by the Selling Stockholders
        may be issued without restrictive legend.  We will advise you if the
        registration statement is not available or effective at any point in the
        future.

       

       

      
        	 	 	 	
                Very
                  truly yours,

              	 
	 	 	 	 	 
	 	 	 	
                [Company
                  counsel]

              	 

      

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      Schedule
        A to Exhibit A

       

      
        	
                Selling
                  Stockholder

              	
                R/N/O

              	
                Shares

                Being
                  Offered

              
	 	 	 
	 	 	 
	 	 	 
	 	 	 

      

      

       

       

       

       

       

       

       

       

       

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
        7(b)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00131-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00131-of-00352.parquet"}]]