Document:

REGISTRATION
      RIGHTS AGREEMENT

    

     

    REGISTRATION
      RIGHTS AGREEMENT, dated as of February 22, 2007, among National Holdings
      Corporation (the “Company”) and each of the purchasers named on the signature
      pages hereto (individually, a “Purchaser” and collectively, the
“Purchasers”).

     

    WHEREAS,
      in connection with that certain Securities Purchase Agreement dated February
      22,
      2007 between the Purchasers and the Company (the “Securities Purchase
      Agreement”), the Company has agreed, upon the terms and subject to the
      conditions of the Securities Purchase Agreement, to issue and sell to the
      Purchasers an aggregate of up to (a) $1,000,000 principal amount of 10%
      Promissory Notes (the "Notes") and (b) warrants (the “Warrants”) to purchase up
      to 250,000 shares of the Company’s common stock, $0.02 par value per share (the
“Common Stock”),
      at an
      initial exercise price of $1.40 per share; 

     

    WHEREAS,
      to induce the Purchasers to execute and deliver the Securities Purchase
      Agreement, the Company has agreed to provide certain registration rights with
      respect to the shares of Common Stock issuable upon exercise of the Warrants
      (the “Registrable Securities”) on the terms and conditions provided
      herein.

    

    NOW,
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, the parties hereto hereby agree as
      follows:

    

    1.     Piggyback
      Registration Statement.
      If,
      at
      any time, the Company proposes to file with the Securities
      and Exchange Commission (the “SEC”) any
      registration statement on Form S-3 or such other appropriate form in accordance
      with the Securities Act of 1933, as amended (the “Securities Act”) for purposes
      of a public offering of securities of the Company (including, but not limited
      to, registration statements relating to secondary offerings of securities of
      the
      Company, but excluding registration statements relating to employee benefit
      plans or with respect to corporate reorganizations or other transactions under
      Rule 145 of the Securities Act or initial public offerings) it will give written
      notice by facsimile or mail, at least five (5) days prior to the filing of
      each
      registration statement, to the Purchasers of its intention to do so. If the
      Purchaser notifies the Company within five (5) days after receipt of any such
      notice of its or their desire to include any such securities in such proposed
      registration statement, the Company shall afford the Purchasers the opportunity
      to have any Registrable Securities registered under such registration
      statement.

    

    2.     Demand
      Registration.

     

    2.1     Request
      for Registration Statement.
      At any
      time commencing after February 22, 2008, the holders of at least 50% of the
      Registrable Securities held by the Purchasers may make a written demand for
      registration under the 1933 Act of all or part of their Registrable Securities
      (a “Demand Registration”). Any demand for a Demand Registration shall specify
      the number of shares of Registrable Securities proposed to be sold. The Company
      will notify all holders of Registrable Securities of the demand, and each holder
      of Registrable Securities who wishes to include all or a portion of such
      holder’s Registrable Securities in the Demand Registration (each such holder
      including shares of Registrable Securities in such registration, a “Demanding
      Holder”) shall so notify the Company within fifteen (15) days after the receipt
      by the holder of the notice from the Company. Upon any such request, the
      Demanding Holders shall be entitled to have their Registrable Securities
      included in the Demand Registration. The Company shall not be obligated to
      affect more than one Demand Registration under this Section 2.1 in respect
      of
      Registrable Securities.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2.2     Filing
      Registration Statement.
      The
      Company shall, as expeditiously as possible and in any event on or before 90
      days following
      the Company’s receipt of a written notice with respect to a Demand
      Registration, prepare
      and file with the SEC a Registration Statement on any form for which the Company
      then qualifies and which form shall be available for the sale of all Registrable
      Securities to be registered thereunder. Such
      Registration Statement shall include the plan of distribution substantially
      in
      the form attached hereto as Exhibit
      A.
      Such
      Registration Statement also shall cover, to the extent allowable under the
      1933
      Act and the rules promulgated thereunder (including Rule 416), such
      indeterminate number of additional shares of Common Stock resulting from stock
      splits, stock dividends or similar transactions with respect to the Registrable
      Securities. The Company shall have the right to include in such Registration
      Statement shares of Common Stock remaining unsold by the persons who are set
      forth in the selling stockholders section of that certain definitive prospectus
      of the Company dated November 6, 2006, as supplemented, and certain additional
      shares of Common Stock as may be issued subsequent to such date or which persons
      may have the right to acquire pursuant to the exercise, conversion or exchange
      of securities of the Company. The Registration Statement (and each amendment
      or
      supplement thereto, and each request for acceleration of effectiveness thereof)
      shall be provided in accordance with Section 3.2 to the Purchasers and their
      counsel prior to its filing or other submission. 

     

    2.3     Effectiveness.

     

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

     

    3.     Obligations
      of the Company.
      In
      connection with the filing of any registration statement herein, the Company
      shall:

    

    3.1     Prepare
      and file with the SEC such amendments and supplements to such registration
      statement and the prospectus used in connection with such registration statement
      as may be necessary to comply with the provisions of the Securities Act with
      respect to the disposition of all securities covered by such registration
      statement.

    

    3.2     Furnish
      to the Purchasers such numbers of copies of a prospectus, including a
      preliminary prospectus, in conformity with the requirements of the Securities
      Act, and such other documents as they may reasonably request in order to
      facilitate the disposition of Registrable Securities owned by
      them.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    3.3     Use
      its
      commercially reasonable efforts to register and qualify the securities covered
      by such registration statement under such other securities or “blue sky” laws of
      such jurisdictions as shall be reasonably requested by the Purchasers;
provided,
      however,
      that
      the Company shall not be required in connection therewith or as a condition
      thereto to qualify to do business or to file a general consent to service of
      process in any such states or jurisdictions.

    

    3.4     Notify
      each Purchaser of Registrable Securities covered by such registration statement
      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 included 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 in the light of the circumstances then existing.

    

    3.5     Use
      its
      commercially reasonable efforts to cause all Registrable Securities covered
      by
      such registration statement to be listed on each securities exchange, if any,
      on
      which similar securities listed by the Company are then listed.

    

    4.     Obligations
      of the Purchasers.
      

    

    Each
      Purchaser of Registrable Securities shall furnish to the Company such
      information regarding such Purchaser, the number of Registrable Securities
      owned
      and proposed to be sold by it, the intended method of disposition of such
      securities and any other information as shall be required to effect the
      registration of such Purchaser’s Registrable Securities, and cooperate with the
      Company in preparing the registration statement and in complying with the
      requirements of the Securities Act.

     

    5.     Registration
      Expenses.
      

    

    The
      Company shall bear and pay all expenses incurred in connection with any
      registration, filing or qualification of Registrable Securities, including
      without limitation all registration, listing, filing and qualification fees,
      printers and accounting fees, but excluding (i) underwriting discounts and
      commissions relating to the Registrable Securities and (ii) legal fees and
      disbursements of any and all counsel retained by the Purchasers. 

    

    
      	 	
              6.

            	
              Suspension
                of Effectiveness.

            

    

    

    For
      not
      more than twenty (20) consecutive days or for a total of not more than sixty
      (60) days in any twelve (12) month period, the Company may delay the disclosure
      of material non-public information concerning the Company, by suspending the
      use
      of any Prospectus included in any registration contemplated by this Section
      containing such information, the disclosure of which at the time is not, in
      the
      good faith opinion of the Company, in the best interests of the Company (an
      “Allowed Delay”); provided, that the Company shall promptly (a) notify the
      Purchasers in writing of the existence of (but in no event, without the prior
      written consent of an Investor, shall the Company disclose to such Investor
      any
      of the facts or circumstances regarding) material non-public information giving
      rise to an Allowed Delay, (b) advise the Purchasers in writing to cease all
      sales under the Registration Statement until the end of the Allowed Delay and
      (c) use commercially reasonable efforts to terminate an Allowed Delay as
      promptly as practicable.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	 	
              7.

            	
              Indemnification.
                

            

    

    

    7.1     To
      the
      extent permitted by law, the Company will indemnify each Purchaser, its
      directors, officers, shareholders, employees, agents and affiliates, legal
      counsel for the Purchasers, and each person controlling such Purchaser within
      the meaning of the Securities Act, with respect to which registration,
      qualification or compliance of Registrable Securities has been effected pursuant
      to this Agreement, against any losses, claims, damages, liabilities or actions
      in respect thereof (collectively, “Damages”), arising out of or based on any
      untrue statement or alleged untrue statement of a material fact contained in
      a
      Registration Statement filed pursuant hereto, prospectus offering circular
      or
      other document, or any 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 Securities Exchange Act of 1934, as amended (the “Exchange
      Act”), or any state securities laws or any rule or regulation promulgated under
      such laws and relating to action or inaction required of the Company in
      connection with any such registration, qualification or compliance; and the
      Company will pay each such Purchaser any legal and other expenses reasonably
      incurred by them in connection with investigating or defending any such claim,
      loss, damage, liability or action; provided,
      however,
      that
      the indemnity contained in this Section 7.1 shall not apply to: (i) amounts
      paid
      in settlement of any such Damages if settlement is effected without the consent
      of the Company (which consent shall not unreasonably be withheld); (ii) any
      such
      Damages arising out of or a based upon any untrue statement or omission based
      upon information furnished to the Company by such Purchaser and stated to be
      for
      use in connection with the offering of securities of the Company; or (iii)
      any
      such Damages arising out of or based upon such Purchaser’s failure to deliver a
      copy of the registration statement or prospectus or any amendments or
      supplements thereto.

    

    7.2     To
      the
      extent permitted by law, each Purchaser will, if Registrable Securities held
      by
      such Purchaser are included in the securities as to which such registration,
      qualification or compliance is being effected pursuant to this Agreement,
      indemnify the Company, each of its directors, officers, shareholders, employees,
      agents and affiliates, each legal counsel and independent accountant of the
      Company, each person who controls the Company within the meaning of the
      Securities Act, and each other such Purchaser, each of its directors, officers,
      shareholders, employees, agents and affiliates, legal counsel, and each person
      controlling such other Purchaser within the meaning of the Securities Act,
      against all Damages arising out of or based upon arising any untrue statement
      or
      alleged untrue statement of a material fact contained in a registration
      statement filed pursuant hereto, prospectus offering circular or other document,
      or any 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 such Purchaser of the Securities Act,
      the
      Exchange Act, or any state securities laws or any rule or regulation promulgated
      under such laws and relating to action or inaction required of such Purchaser
      in
      connection with any such registration, qualification or compliance; and such
      Purchaser will pay the Company or such other Purchasers any legal and other
      expenses reasonably incurred by them in connection with investigating or
      defending any such claim, loss, damage, liability or action, in each case,
      to
      the extent, but only to the extent, that such untrue statement or alleged untrue
      statement or omission or alleged omission is made in such registration
      statement, prospectus, offering circular or other document in reliance on and
      in
      conformity with information furnished to the Company by such Purchaser and
      stated to be for use in connection with the offering of securities of the
      Company; provided,
      however,
      that
      the indemnity contained in this Section 7.2 shall not apply to amounts paid
      in
      settlement of any such Damages if settlement is effected without the consent
      of
      such Purchaser (which consent shall not unreasonably be
      withheld).

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    7.3     Promptly
      after receipt by an indemnified party under this Section 7 of notice of the
      commencement of any action (including any governmental action), such indemnified
      party will, if a claim in respect thereof is to be made against any indemnifying
      party under this Section 7, deliver to the indemnifying party a written notice
      of the commencement thereof and the indemnifying party shall have the right
      to
      participate in, and, to the extent the indemnifying party so chooses, jointly
      with any other indemnifying party similarly noticed, to assume the defense
      thereof with counsel mutually satisfactory to the parties; provided,
      however,
      that an
      indemnified party shall have the right to retain one separate counsel, with
      the
      reasonable fees and expenses to be paid by the indemnifying party, if
      representation of such indemnified party by the counsel retained by the
      indemnifying party would be inappropriate due to actual or potential differing
      interests between such indemnified party and any other party represented by
      such
      counsel in such proceeding. The failure to deliver written notice to the
      indemnifying party within a reasonable time of the commencement of any such
      action, if prejudicial to its ability to defend such action, shall relieve
      such
      indemnifying party of any liability to the indemnified party under this Section
      7, but the omission to so deliver written notice to the indemnifying party
      will
      not relieve it of any liability that it may have to any indemnified party
      otherwise than under this Section 7.

    

    7.4     If
      the
      indemnification provided for in this Section 7 is held by a court of competent
      jurisdiction to be unavailable to an indemnified party with respect to any
      loss,
      liability, claim, damage or expense referred to therein, then the indemnifying
      party, in lieu of indemnifying such indemnified party hereunder, shall
      contribute to the amount paid or payable by such indemnified party as a result
      of such Damages in such proportion as is appropriate to reflect the relative
      fault of the indemnifying party on the one hand and of the indemnified party
      on
      the other in connection with the statements or omissions that resulted in such
      Damages as well as any other relevant equitable considerations. The relative
      fault of the indemnifying party and of the indemnified party shall be determined
      by reference to, among other things, whether the untrue or alleged untrue
      statement of a material fact or the omission or alleged omission to state a
      material fact relates to information supplied by the indemnifying party or
      by
      the indemnified party and the parties’ relative intent, knowledge, access to
      information and opportunity to correct or prevent such statement or
      omission.

    

    7.5     The
      obligations of the Company and the Purchasers under this Section 7 shall survive
      the completion of any offering of Registrable Securities pursuant to a
      registration statement under this Agreement.  

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    8.     Notices.

    

    8.1     Any
      notice or communication required or permitted hereunder shall be given in
      writing and shall be made by hand delivery, by confirmed facsimile, by overnight
      courier or by registered or certified mail, addressed (i) if to a Purchaser,
      to
      such Purchaser’s address as set forth on Schedule A hereto, and (ii) if to the
      Company, to National Holdings Corporation, 120 Broadway, 27th
      Floor,
      New York, NY 10271, facsimile number (212) 417-8010, Attn: Mark Goldwasser,
      with
      a copy to Littman Krooks LLP, 655 Third Avenue, New York, NY 10017, facsimile
      number (212) 490-2990, Attn: Mitchell C. Littman, Esq. 

     

    8.2     All
      such
      notices and other communications shall be deemed to have been delivered and
      received (i) in the case of personal delivery or facsimile, on the date of
      such
      delivery, (ii) in the case of overnight courier, on the business day after
      the
      date when sent, and (iii) in the case of registered or certified mail, on the
      third business day following such mailing.

    

    9.     Miscellaneous.

    

       9.1     This
      Agreement shall be governed by, and construed in accordance with, the laws
      of
      the State of New York, without regard to the principles of the conflict of
      laws
      thereof. The parties hereby irrevocably and unconditionally consent to submit
      to
      the exclusive jurisdiction of the courts of the State of New York located in
      New
      York County and any Federal court located within New York County for any
      actions, suits or proceedings arising out of or relating to this Agreement.
      The
      parties hereby irrevocably and unconditionally waive any objection to the laying
      of venue of any action, suit or proceeding arising out of this Agreement in
      the
      courts of the State of New York located in New York County or the courts of
      the
      United States of America located in New York County, and hereby further
      irrevocably and unconditionally waive and agree not to plead or claim in any
      such court that any such action, suit of proceeding brought in any such court
      has been brought in an inconvenient forum.

    

    9.2     Any
      term
      of this Agreement may be amended and the observance of any term of this
      Agreement may be waived (either generally or in a particular instance and either
      retroactively or prospectively), only with the written consent of the Company
      and the Purchasers of a majority of the Registrable Securities then outstanding.
      Any amendment or waiver effected in accordance with this paragraph shall be
      binding upon each Purchaser of any Registrable Securities then outstanding,
      each
      future Purchaser of all such Registrable Securities, and the
      Company.

    

    9.3     Nothing
      in this Agreement, express or implied, is intended to confer upon any party
      other than the parties hereto any rights, remedies, obligations or liabilities
      under or by reason of this Agreement, excepts as expressly provided
      herein.

    

    9.4     If
      one or
      more provisions of this Agreement are held to be unenforceable under applicable
      law, such provision shall be excluded from this Agreement and the balance of
      the
      Agreement shall be interpreted as if such provision were so excluded and shall
      be enforceable in accordance with its terms.

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    9.5     The
      headings of the Sections of this Agreement are for convenience and shall not
      by
      themselves determine the interpretation of this Agreement.

    

    9.6     This
      Agreement constitutes the entire contract among the Company and the Purchasers
      relative to the subject matter hereof and supersedes in its entirety any and
      all
      prior agreements, understandings and discussions with respect thereto.

    

    9.7     This
      agreement may be executed in any number of counterparts (including, in the
      case
      of the purchasers, financing signature pages), each of which shall be deemed
      to
      be an original, and all of which shall constitute one and the same document.
      In
      the event that any signature (including a financing signature page) is
      delivered by facsimile transmission or by e-mail delivery of a “.pdf” format
      data file, such signature shall create a valid and binding obligation of the
      party executing (or on whose behalf such signature is executed) with the same
      force and effect as if such facsimile or “.pdf” signature page were an original
      thereof. 

     

    

    

    

    [BALANCE
      OF PAGE INTENTIONALLY LEFT BLANK]

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

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

     

    
      	 	 	 
	 	COMPANY:
	 	 
	 	NATIONAL HOLDINGS CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ MARK
              GOLDWASSER
	 	
              
Name:
              Mark Goldwasser
	 	Title:
              Chief Executive Officer 

      	 	       
              	 
	 	PURCHASERS:
	 	 
	 	/s/ CHRISTOPHER C. DEWEY 
              
Christopher
              C. Dewey

    

     

    
      	 	 	 
	 	ST.
              CLOUD CAPITAL
              PARTNERS, L.P. 
	 	 
	 	By: SCGP, LLC, its General
              Partner
	 
 	 
 	
 
	 	By:  	/s/ MARSHALL
              S. GELLER 
	 	
              
Name:
              Marshall S. Geller
	 	Its:    
              Senior Managing Member

    

     

    
      	 	 	 
	 	BEDFORD
              OAKS PARTNERS, L.P.
	 
 	 
 	 
 
	 	By:  	/s/ HARVEY
              EISEN
	 	
              
Name:
              Harvey Eisen
	 	Title:  
              Chairman and Managing Partner

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Schedule
      A

    

     

    
      	 	 	Number of 
	
              Purchaser
                Name

            	
              Purchaser
                Address

            	Registrable
              Securities 
	 	 	 
	
              Christopher
                C. Dewey

            	
              PO
                Box 23

              Oldwick,
                NJ 08858

            	
              125,000

            
	 	 	 
	
              St.
                Cloud Capital Partners, L.P.

            	
              10866
                Wilshire Blvd.

              Suite
                1450

              Los
                Angeles, CA 90024

            	
              62,500

            
	 	 	 
	
              Bedford
                Oaks Partners, L.P.

            	
              100
                South Bedford Road

              Mt.
                Kisco, NY 10549

            	
              62,500

            

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    Exhibit
      A

    

    Plan
      of Distribution

    

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

    

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

    

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

    

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

    

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

    

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

    

    -
      privately negotiated transactions;

    

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

    

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

    

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

    

    -
      a
      combination of any such methods of sale; and

    

    -
      any
      other method permitted pursuant to applicable law.

    

    The
      selling stockholders may, from time to time, pledge or grant a security interest
      in some or all of the shares of common stock owned by them and, if they default
      in the performance of their secured obligations, the pledgees or secured parties
      may offer and sell the shares of common stock, from time to time, under this
      prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or
      other applicable provision of the 1933 Act amending the list of selling
      stockholders to include the pledgee, transferee or other successors in interest
      as selling stockholders under this prospectus. The selling stockholders also
      may
      transfer the shares of common stock in other circumstances, in which case the
      transferees, pledgees or other successors in interest will be the selling
      beneficial owners for purposes of this prospectus.

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

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

    

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

    

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

    

    The
      selling stockholders and any underwriters, broker-dealers or agents that
      participate in the sale of the common stock or interests therein may be
      "underwriters" within the meaning of Section 2(11) of the 1933 Act. Any
      discounts, commissions, concessions or profit they earn on any resale of the
      shares may be underwriting discounts and commissions under the 1933 Act. Selling
      stockholders who are "underwriters" within the meaning of Section 2(11) of
      the
      1933 Act will be subject to the prospectus delivery requirements of the 1933
      Act.

    

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

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

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

    

    We
      have
      advised the selling stockholders that the anti-manipulation rules of Regulation
      M under the 1934 Act may apply to sales of shares in the market and to the
      activities of the selling stockholders and their affiliates. In addition, we
      will make copies of this prospectus (as it may be supplemented or amended from
      time to time) available to the selling stockholders for the purpose of
      satisfying the prospectus delivery requirements of the 1933 Act. The selling
      stockholders may indemnify any broker-dealer that participates in transactions
      involving the sale of the shares against certain liabilities, including
      liabilities arising under the 1933 Act.

    

    We
      have
      agreed to indemnify the selling stockholders against liabilities, including
      liabilities under the 1933 Act and state securities laws, relating to the
      registration of the shares offered by this prospectus.

    

    We
      have
      agreed with the selling stockholders to keep the registration statement of
      which
      this prospectus constitutes a part effective until the earlier of (1) such
      time
      as all of the shares covered by this prospectus have been disposed of pursuant
      to and in accordance with the registration statement or (2) the date on which
      the shares may be sold pursuant to Rule 144(k) of the 1933 Act.

     

    
      
        
        

      

      
        12[Execution
      Copy]

     

    
      

      

    

     

    SECURITIES
      PURCHASE AGREEMENT

     

    BY
      AND BETWEEN

     

    FUELCELL
      ENERGY, INC.

     

    AND

     

    POSCO
      POWER

     

    FEBRUARY
      7, 2007

     

    
      

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    TABLE
      OF CONTENTS

    

      
        	 	 	 	 	
                Page

              
	
                ARTICLE
                  1

              	 	
                PURCHASE
                  AND SALE OF SECURITIES

              	 	
                1

              
	
                1.1

              	
                 

              	
                Purchase
                  and Sale of Securities

              	 	
                1

              
	
                1.2

              	 	
                Payment

              	 	
                2

              
	
                1.3

              	 	
                Adjustment

              	 	
                2

              
	
                1.4

              	 	
                Closing
                  Date

              	 	
                2

              
	
                1.5

              	 	
                Additional
                  Purchaser Deliveries at the Closing

              	 	
                2

              
	
                1.6

              	 	
                Additional
                  Company Deliveries at the Closing

              	 	
                2

              
	
                ARTICLE
                  2

              	 	
                REPRESENTATIONS
                  AND WARRANTIES OF THE COMPANY

              	 	
                3

              
	
                2.1

              	 	
                Organization
                  and Qualification

              	 	
                3

              
	
                2.2

              	 	
                Authorization;
                  Enforcement

              	 	
                3

              
	
                2.3

              	 	
                Capitalization.

              	 	
                3

              
	
                2.4

              	 	
                Issuance
                  of Shares

              	 	
                4

              
	
                2.5

              	 	
                No
                  Conflicts; Government Consents and Permits

              	 	
                4

              
	
                2.6

              	 	
                SEC
                  Documents, Financial Statements

              	 	
                5

              
	
                2.7

              	 	
                Disclosure
                  Controls and Procedures

              	 	
                6

              
	
                2.8

              	 	
                Accounting
                  Controls

              	 	
                6

              
	
                2.9

              	 	
                Absence
                  of Litigation

              	 	
                6

              
	
                2.10

              	 	
                Intellectual
                  Property Rights

              	 	
                7

              
	
                2.11

              	 	
                No
                  Material Adverse Change

              	 	
                7

              
	
                2.12

              	 	
                Taxes

              	 	
                8

              
	
                2.13

              	 	
                Real
                  and Personal Property

              	 	
                8

              
	
                2.14

              	 	
                Material
                  Contracts

              	 	
                8

              
	
                2.15

              	 	
                Employee
                  Benefit Plans; Employee Matters

              	 	
                9

              
	
                2.16

              	 	
                Environmental
                  Laws

              	 	
                9

              
	
                2.17

              	 	
                Compliance
                  with Law

              	 	
                9

              
	
                2.18

              	 	
                Insurance

              	 	
                9

              
	
                2.19

              	 	
                Foreign
                  Corrupt Practices

              	 	
                10

              
	
                2.20

              	 	
                Related
                  Party Transactions

              	 	
                10

              
	
                2.21

              	 	
                No
                  Integration; General Solicitation

              	 	
                10

              
	
                2.22

              	 	
                No
                  Registration Rights

              	 	
                11

              
	
                2.23

              	 	
                NASDAQ

              	 	
                11

              
	
                2.24

              	 	
                Investment
                  Company

              	 	
                11

              
	
                2.25

              	 	
                Acknowledgment
                  Regarding Purchaser’s Purchase of Shares

              	 	
                11

              
	
                2.26

              	 	
                Accountants

              	 	
                11

              
	
                2.27

              	 	
                Takeover
                  Provision

              	 	
                12

              
	
                2.28

              	 	
                No
                  Manipulation of Stock

              	 	
                12

              
	
                2.29

              	 	
                Form
                  S-3 Eligibility

              	 	
                12

              
	
                2.30

              	 	
                Vote
                  Required

              	 	
                12

              
	
                2.31

              	 	
                Board
                  Approval

              	 	
                12

              
	
                2.32

              	 	
                Sarbanes-Oxley
                  Act

              	 	
                12

              
	
                2.33

              	 	
                Books
                  and Records

              	 	
                12

              
	
                2.34

              	 	
                Transfer
                  Taxes

              	 	
                12

              
	
                2.35

              	 	
                Fees

              	 	
                13

              

      

       

      
        
          
          

        

        
          -i-

          
            

          

        

        
          
          

        

      

       

      
        	
                ARTICLE
                  3

              	 	
                PURCHASER’S
                  REPRESENTATIONS AND WARRANTIES

              	 	
                13

              
	
                3.1

              	 	
                Investment
                  Purpose

              	 	
                13

              
	
                3.2

              	 	
                Purchaser
                  Status; Questionnaires

              	 	
                13

              
	
                3.3

              	 	
                Reliance
                  on Exemptions

              	 	
                13

              
	
                3.4

              	 	
                Information

              	 	
                13

              
	
                3.5

              	 	
                Acknowledgement
                  of Risk

              	 	
                14

              
	
                3.6

              	 	
                Governmental
                  Review

              	 	
                14

              
	
                3.7

              	 	
                Transfer
                  or Resale

              	 	
                14

              
	
                3.8

              	 	
                Legends

              	 	
                15

              
	
                3.9

              	 	
                Authorization;
                  Enforcement

              	 	
                16

              
	
                3.10

              	 	
                Residency

              	 	
                16

              
	
                3.11

              	 	
                No
                  Short Sales

              	 	
                16

              
	
                3.12

              	 	
                Brokers

              	 	
                16

              
	
                3.13

              	 	
                Additional
                  Representations by Non-US Person

              	 	
                16

              
	
                ARTICLE
                  4

              	 	
                COVENANTS

              	 	
                16

              
	
                4.1

              	 	
                Reporting
                  Status and Public Information

              	 	
                16

              
	
                4.2

              	 	
                Financial
                  Information

              	 	
                17

              
	
                4.3

              	 	
                Securities
                  Laws Disclosure; Publicity

              	 	
                17

              
	
                4.4

              	 	
                Covenants
                  Pending Closing

              	 	
                17

              
	
                4.5

              	 	
                Limits
                  on Additional Issuances

              	 	
                18

              
	
                4.6

              	 	
                Sales
                  by Purchaser

              	 	
                18

              
	
                4.7

              	 	
                Further
                  Assurances

              	 	
                18

              
	
                4.8

              	 	
                Consents
                  and Approvals

              	 	
                18

              
	
                4.9

              	 	
                No
                  Solicitation

              	 	
                18

              
	
                4.10

              	 	
                Form
                  D and Blue Sky

              	 	
                18

              
	
                4.11

              	 	
                Efforts
                  to Satisfy Conditions

              	 	
                18

              
	
                4.12

              	 	
                Use
                  of Proceeds

              	 	
                19

              
	
                4.13

              	 	
                Expenses

              	 	
                19

              
	
                ARTICLE
                  5

              	 	
                CONDITIONS
                  TO CLOSING

              	 	
                19

              
	
                5.1

              	 	
                Conditions
                  to Obligations of the Company

              	 	
                19

              
	
                5.2

              	 	
                Conditions
                  to Purchaser’s Obligations at the Closing

              	 	
                20

              
	
                ARTICLE
                  6

              	 	
                REGISTRATION
                  RIGHTS

              	 	
                22

              
	
                6.1

              	 	
                Mandatory
                  Registration

              	 	
                22

              
	
                6.2

              	 	
                Demand
                  Registrations

              	 	
                22

              
	
                6.3

              	 	
                Piggy-Back
                  Registrations

              	 	
                22

              
	
                6.4

              	 	
                Ineligibility
                  for Form S-3

              	 	
                23

              
	
                6.5

              	 	
                Failure
                  to File, Obtain and Maintain Effectiveness of Registration
                  Statement

              	 	
                23

              
	
                6.6

              	 	
                Related
                  Obligations

              	 	
                24

              
	
                6.7

              	 	
                Obligations
                  of the Holder

              	 	
                29

              
	
                6.8

              	 	
                Expenses
                  of Registration

              	 	
                30

              
	
                6.9

              	 	
                Indemnification

              	 	
                30

              
	
                6.10

              	 	
                Assignment
                  and Transfer

              	 	
                32

              
	
                6.11

              	 	
                Amendment
                  and Waiver of Registration Rights

              	 	
                32

              
	
                6.12

              	 	
                Lock-Up
                  Period

              	 	
                33

              

      

       

      
        
          
          

        

        
          -ii-

          
            

          

        

        
          
          

        

      

       

      
        	
                ARTICLE
                  7

              	 	
                MISCELLANEOUS

              	 	
                33

              
	
                7.1

              	 	
                Termination

              	 	
                33

              
	
                7.2

              	 	
                Effect
                  of Termination

              	 	
                33

              
	
                7.3

              	 	
                Governing
                  Law; Jurisdiction

              	 	
                34

              
	
                7.4

              	 	
                Counterparts;
                  Signatures by Facsimile

              	 	
                34

              
	
                7.5

              	 	
                Headings

              	 	
                34

              
	
                7.6

              	 	
                Severability

              	 	
                34

              
	
                7.7

              	 	
                Entire
                  Agreement; Amendments; Waiver

              	 	
                34

              
	
                7.8

              	 	
                Notices

              	 	
                34

              
	
                7.9

              	 	
                Successors
                  and Assigns

              	 	
                35

              
	
                7.10

              	 	
                Third
                  Party Beneficiaries

              	 	
                35

              
	
                7.11

              	 	
                No
                  Strict Construction

              	 	
                36

              
	
                7.12

              	 	
                Equitable
                  Relief

              	 	
                36

              
	
                7.13

              	 	
                Survival
                  of Representations and Warranties

              	 	
                36

              
	
                7.14

              	 	
                Limitation
                  on Enforcement of Remedies

              	 	
                36

              
	
                7.15

              	 	
                Aggregation
                  of Stock

              	 	
                36

              
	
                7.16

              	 	
                Reproduction
                  of Documents

              	 	
                36

              
	
                7.17

              	 	
                Lost,
                  etc. Certificates Evidencing Shares; Exchange

              	 	
                36

              
	
                7.18

              	 	
                Draftsmanship

              	 	
                37

              

      

       

      
        
          
          

        

        
          -iii-

          
            

          

        

        
          
          

        

      

    

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      SECURITIES PURCHASE AGREEMENT (this “Agreement”),
      dated
      and effective as of February 7, 2007, is made by and between FUELCELL ENERGY,
      INC., a Delaware corporation (the “Company”),
      and
      POSCO POWER, a Korean corporation, together with its permitted transferee (the
      “Purchaser”).
      Capitalized terms used herein and not otherwise defined have the meanings given
      to them in Exhibit
      A.

     

    RECITALS:

     

    A. The
      Company and the Purchaser are executing and delivering this Agreement in
      reliance upon the exemption from securities registration afforded by Section
      4(2) of the Securities Act and/or Regulation D under the Securities Act or
      Regulation S thereunder.

     

    B. The
      Purchaser desires to purchase and the Company desires to sell, subject to the
      terms and conditions stated in this Agreement, up to a maximum of $29,000,000
      of
      Common Stock.

     

    C. As
      set
      forth herein, the Company has agreed to provide certain registration rights
      with
      respect to the Shares under the Securities Act and the rules and regulations
      promulgated thereunder, and applicable state securities laws. 

     

    D. Simultaneously
      herewith, the parties have entered into the Alliance Agreement and the
      Technology Transfer Agreement.

     

    AGREEMENT

     

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

     

    ARTICLE
      1

     

    PURCHASE
      AND SALE OF SECURITIES

     

    1.1 Purchase
      and Sale of Securities.
      Subject
      to the terms and conditions set forth in this Agreement and to the conditions
      set forth herein, and in reliance upon the Company’s and the Purchaser’s
      representations set forth herein, at the Closing, the Company will issue and
      sell to the Purchaser, and the Purchaser will purchase from the Company the
      number of shares of Common Stock that would result in the Purchaser owning,
      after giving effect to such purchase, up to a maximum of $29,000,000 (each
      a
“Share”
and
      collectively, the “Shares”),
      free
      and clear of any Liens. At the Closing, the Purchaser shall pay the Company,
      as
      consideration for the Shares, cash in an amount equal to the product of (i)
      the
      number of Shares and (ii) the Per Share Purchase Price (the “Purchase
      Price”).
      The
“Per
      Share Purchase Price”
shall
      be equal to (i) if the Market Price is less than $8.33 per share of Common
      Stock, the product of the Market Price and 1.2, (ii) if the Market Price is
      between $8.33 per share of Common Stock and $10.00 per share of Common Stock,
      $10.00 and (iii) if the Market Price is above $10.00 per share of Common Stock,
      the Market Price. The “Market
      Price”
shall
      be equal to the average of the respective last sale prices per share of Common
      Stock on the Nasdaq Stock Market (“NASDAQ”)
      on the
      twenty (20) most recent trading days prior to the date hereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.2 Payment.
      At the
      Closing, the Purchaser shall pay the Purchase Price by wire transfer of
      immediately available funds, in US dollars, in accordance with wire instructions
      provided by the Company to the Purchaser at least three (3) Business Days prior
      to the Closing. The Company will instruct its transfer agent to deliver to
      the
      Purchaser at Closing a certificate evidencing the Shares registered in the
      name
      of the Purchaser, or in the name of a nominee designated by the Purchaser,
      against delivery of the Purchase Price on the Closing Date.

     

    1.3 Adjustment.
      The
      number of Shares to be purchased by the Purchaser at the Closing pursuant to
      Sections
      1.1
      and
1.2
      and the
      Purchase Price shall be proportionately adjusted for any subdivision or
      combination of Common Stock (by stock split, reverse stock split, dividend,
      reorganization, recapitalization or otherwise). 

     

    1.4 Closing
      Date.
      The
      closing of the transaction contemplated by this Agreement (the “Closing”)
      will
      take place on the date to be specified by the parties, which shall be a date
      following the day on which the last of the conditions set forth in Article
      5
      shall
      have been satisfied or waived (excluding conditions that, by their nature,
      cannot be satisfied until the Closing Date), unless this Agreement has been
      terminated pursuant to its terms or unless another time or date for the Closing
      is agreed to in writing by the Company and the Purchaser (the actual time and
      date of the Closing being referred to herein as the “Closing
      Date”);
      provided
      that the
      Closing Date shall be no earlier than the fifth Business Day after the date
      on
      which the “Effective Date” as defined in the Alliance Agreement shall have
      occurred. The Closing will be held at the offices of Sidley Austin LLP, 787
      Seventh Avenue, New York, New York or at such other time and place as shall
      be
      agreed upon by the Company and the Purchaser. At the Closing, the Company and
      the Purchaser shall make certain deliveries, as specified in Sections
      1.2,
      1.5
      and
1.6,
      and all
      such deliveries, regardless of chronological sequence, shall be deemed to occur
      contemporaneously and simultaneously on the occurrence of the last delivery
      and
      none of such deliveries shall be effective until the last of the same has
      occurred.

     

    1.5 Additional
      Purchaser Deliveries at the Closing.
      At the
      Closing, the Purchaser shall deliver to the Company, subject to Section
      1.2:
      (i) the
      Alliance Agreement and the Technology Transfer Agreement duly executed by the
      Purchaser; and (ii) the certificates, agreements, instruments and other
      documents referred to in Section
      5.1.

     

    1.6 Additional
      Company Deliveries at the Closing.
      At the
      Closing, the Company shall deliver to the Purchaser, subject to Section
      1.2:
      (i) the
      Alliance Agreement and the Technology Transfer Agreement duly executed by the
      Company; and (ii) the certificates, opinions, agreements, instruments and other
      documents referred to in Section
      5.2.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      2

     

    REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY

     

    Except
      as
      specifically contemplated by this Agreement or as set forth in the Disclosure
      Schedules, which Disclosure Schedules shall be deemed a part hereof, the Company
      hereby represents and warrants as follows:

     

    2.1 Organization
      and Qualification.
      The
      Company is duly incorporated, validly existing and in good standing under the
      laws of the State of Delaware, with full corporate power and authority to
      conduct its business as currently conducted as disclosed in the SEC Documents.
      Each of the Company’s Subsidiaries is duly formed, validly existing and in good
      standing under the laws of the laws of its jurisdiction of organization, with
      full corporate power and authority to conduct its business as currently
      conducted. The Company owns all of the capital stock or membership interests
      of
      each Subsidiary free and clear of any and all Liens, and all of the outstanding
      shares of capital stock of each Subsidiary are validly issued and are fully
      paid, non-assessable and free of preemptive and similar rights. The Company
      and
      each of its Subsidiaries is duly qualified to do business and is in good
      standing in each jurisdiction in which the nature of the business conducted
      by
      it or property owned by it makes such qualification necessary, except where
      the
      failure to be so qualified or in good standing, as the case may be, would not
      be
      reasonably likely to have a Material Adverse Effect and, to the Company’s
      knowledge, no proceeding has been instituted in any such jurisdiction revoking,
      limiting or curtailing, or seeking to revoke, limit or curtail, such corporate
      power and authority or qualification. 

     

    2.2 Authorization;
      Enforcement.
      The
      Company has all requisite corporate power and corporate authority to enter
      into
      and to perform its obligations under this Agreement (and each of the other
      agreements entered into by the parties hereto in connection with the Offering,
      including the Alliance Agreement and the Technology Transfer Agreement)
      (collectively, the “Related
      Agreements”),
      to
      consummate the transactions contemplated hereby and thereby and to issue the
      Shares in accordance with the terms hereof and thereof. The execution, delivery
      and performance of this Agreement and the Related Agreements by the Company
      and
      the consummation by it of the transactions contemplated hereby and thereby
      in
      accordance with the respective terms hereof and thereof (including the issuance
      of the Shares) have been duly authorized by all necessary corporate proceedings
      on the part of the Company. This Agreement and the Related Agreements have
      been
      duly executed by the Company and, when delivered in accordance with the terms
      hereof and thereof, will constitute legal, valid and binding obligations of
      the
      Company enforceable against the Company in accordance with their respective
      terms, except as enforceability may be limited by applicable bankruptcy,
      insolvency, reorganization, or moratorium or similar laws affecting creditors’
and contracting parties’ rights generally and except as enforceability may be
      subject to general principles of equity and except as rights to indemnity and
      contribution may be limited by applicable laws or public policy underlying
      such
      laws.

     

    2.3 Capitalization. 

     

    (a) The
      authorized capital stock of the Company consists of 150,000,000 shares of its
      Common Stock and 250,000 shares of preferred stock, par value $0.01 per share
      (the “Preferred
      Stock”).
      As of
      the date hereof, the issued and outstanding shares of capital stock of the
      Company consisted of 53,250,484 shares of Common Stock and 64,120 shares of
      Preferred Stock. 

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (b) All
      the
      outstanding shares of capital stock of Common Stock have been duly and validly
      issued and are fully paid and non-assessable, and were issued in accordance
      with
      the registration or qualification requirements of the Securities Act and any
      relevant state securities laws or pursuant to valid exemptions therefrom.

     

    (c) On
      the
      Closing Date, except as disclosed in the SEC Documents or on Section
      2.3
      of the
      Disclosure Schedules, there will be no shares of Common Stock or any other
      equity security of the Company issuable upon conversion, exchange or exercise
      of
      any security of the Company or any of its Subsidiaries, nor will there be any
      rights, options, calls or warrants outstanding or other agreements to acquire
      shares of Common Stock or capital stock of any Subsidiary nor will the Company
      or any of its Subsidiaries be contractually obligated to purchase, redeem or
      otherwise acquire any of their respective outstanding shares. Except as
      disclosed in the SEC Documents, no stockholder of the Company is entitled to
      any
      preemptive or similar rights to subscribe for shares of capital stock of the
      Company and no stockholder of the Company has any rights, contractual or
      otherwise, to designate members of the Company’s Board of Directors (the
“Board”),
      other
      than in accordance with the DGCL. Except as disclosed in the SEC Documents,
      there are no stockholder, voting or other agreements relating to the rights
      and
      obligations of the Company’s stockholders.

     

    (d) The
      Company’s Certificate of Incorporation (the “Certificate
      of Incorporation”),
      as in
      effect on the date hereof, and the Company’s Bylaws (the “Bylaws”)
      as in
      effect on the date hereof, are each filed as exhibits to the SEC Documents.
      

     

    2.4 Issuance
      of Shares.
      The
      Shares are duly authorized and, upon issuance, sale and delivery as contemplated
      by this Agreement, the Shares will be validly issued, fully paid and
      non-assessable securities of the Company, free and clear of any and all Liens,
      other than restrictions on transfer imposed by federal or state securities
      laws.
      Assuming the accuracy of all representations and warranties of the Purchaser
      set
      out in Article
      3,
      the
      offer and issuance by the Company of the Shares is exempt from registration
      under the Securities Act and all applicable “blue sky” laws. 

     

    2.5 No
      Conflicts; Government Consents and Permits.

     

    (a) The
      execution, delivery and performance of this Agreement and the Related Agreements
      by the Company and the consummation by the Company of the transactions
      contemplated hereby and thereby (including the issuance of the Shares) will
      not
      (i) conflict with or result in a violation of any provision of its Certificate
      of Incorporation or Bylaws; (ii) except as described or referred to in
Section
      2.5(a)
      of the
      Disclosure Schedules, violate or conflict with, or result in a breach of any
      provision of, or constitute a default (or an event which with notice or lapse
      of
      time or both would become a default) under, or give to others any rights of
      notice, consent, termination, amendment, acceleration or cancellation of, any
      agreement, indenture, or instrument to which the Company or any of its
      Subsidiaries is a party, or (iii) subject to receipt of the Required Approvals,
      result in a violation of any law, rule, regulation, order, judgment or decree
      (including United States federal and state securities laws and regulations
      and
      regulations of any self-regulatory organizations to which the Company or its
      securities are subject) applicable to the Company or any of its Subsidiaries,
      except in the case of clauses (ii) and (iii) only, for such conflicts, breaches,
      defaults and violations as would not, individually or in the aggregate, be
      reasonably likely to have a Material Adverse Effect. Except as set forth in
      Section
      2.5(a)
      of the
      Company Disclosure Schedule, the execution, delivery and performance of this
      Agreement and the Related Agreements by the Company and the consummation by
      the
      Company of the transactions contemplated hereby and thereby (including the
      issuance of the Shares) will not be deemed a change of control under any
      agreement, instrument or indenture to which the Company or any of its
      Subsidiaries is a party. 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (b) The
      Company is not required to obtain any consent, authorization or order of, or
      make any filing or registration with, any court or governmental agency or any
      regulatory or self regulatory agency in order for it to execute, deliver or
      perform any of its obligations under this Agreement or any of the Related
      Documents in accordance with the terms hereof and thereof, or to issue and
      sell
      the Shares in accordance with the terms hereof and thereof, other than such
      as
      have been made or obtained, and except for (i) the registration of the Shares
      under the Securities Act pursuant to Section
      6
      hereof,
      (ii) any filings required to be made under U.S. federal or state or foreign
      securities laws, or (iii) any filings or notifications required by NASDAQ
      (collectively, the “Required
      Approvals”).
      

     

    (c) Each
      of
      the Company and its Subsidiaries have all franchises, permits, licenses, and
      any
      similar authority necessary for the conduct of its business as now being
      conducted by it as described in the SEC Documents, except for such franchise,
      permit, license or similar authority, the lack of which would not, individually
      or in the aggregate, be reasonably likely to have a Material Adverse Effect
      (“Material
      Permits”).
      Neither the Company nor any of its Subsidiaries has received any actual notice
      of any proceeding relating to revocation or modification of any Material Permit.
      

     

    2.6 SEC
      Documents, Financial Statements.
      The
      Company has filed all reports required to be filed by it under the Securities
      Act and the Exchange Act (all of the foregoing filed at least ten (10) days
      prior to the date hereof and all exhibits included therein and financial
      statements and schedules thereto and documents (other than exhibits)
      incorporated by reference therein, being hereinafter referred to as the
“SEC
      Documents”)
      on a
      timely basis or has received a valid extension of such time of filing and has
      filed any such SEC Document prior to the expiration of any such extension.
      The
      Company has delivered to the Purchaser or its respective representatives true,
      correct and complete copies of SEC Documents not available on the EDGAR system
      dated after January 1, 2007. As of their respective dates, the SEC Documents
      complied in all material respects with the requirements of the Exchange Act
      or
      the Securities Act, as the case may be, and the rules and regulations of the
      SEC
      promulgated thereunder applicable to the SEC Documents, and none of the SEC
      Documents, at the time they were filed with the SEC, contained any untrue
      statement of a material fact or omitted to state a material fact required to
      be
      stated therein or necessary in order to make the statements therein, in light
      of
      the circumstances under which they were made, not misleading. As of their
      respective dates, the Financial Statements and the related notes complied as
      to
      form in all material respects with applicable accounting requirements and the
      published rules and regulations of the SEC with respect thereto. The Financial
      Statements and the related notes have been prepared in accordance with
      accounting principles generally accepted in the United States, consistently
      applied, during the periods involved (except (i) as may be otherwise indicated
      in the Financial Statements or the notes thereto, or (ii) in the case of
      unaudited interim statements, to the extent they may not include footnotes,
      may
      be condensed or summary statements or may conform to the SEC’s rules and
      instructions for Reports on Form 10-Q) and fairly present in all material
      respects the consolidated financial position of the Company as of the dates
      thereof and the consolidated results of its operations and cash flows for the
      periods then ended (subject, in the case of unaudited statements, to normal
      year-end audit adjustments).

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    2.7 Disclosure
      Controls and Procedures.
      The
      Company has established and maintains disclosure controls and procedures (as
      defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) that are effective in
      all
      material respects to ensure that material information relating to the Company,
      including any consolidated Subsidiaries, is made known to its chief executive
      officer and chief financial officer by others within those entities. The
      Company’s certifying officers have evaluated the effectiveness of the Company’s
      controls and procedures as of the end of the period covered by the most recently
      filed quarterly or annual periodic report under the Exchange Act (such date,
      the
“Evaluation
      Date”).
      The
      Company presented in its most recently filed quarterly or annual periodic report
      under the Exchange Act the conclusions of the certifying officers about the
      effectiveness of the disclosure controls and procedures based on their
      evaluations as of the Evaluation Date. Since the Evaluation Date, there have
      been no significant changes in the Company’s internal controls (as such term is
      defined in Item 307(b) of Regulation S-K under the Exchange Act) or, to the
      Company’s knowledge, in other factors that could significantly affect the
      Company’s internal controls.

     

    2.8 Accounting
      Controls.
      The
      Company maintains a system of accounting controls sufficient to provide
      reasonable assurances that (i) transactions are executed in accordance with
      management’s general or specific authorization, (ii) transactions are recorded
      as necessary to permit preparation of financial statements in conformity with
      generally accepted accounting principles as applied in the United States and
      to
      maintain accountability for assets, (iii) access to assets is permitted only
      in
      accordance with management’s general or specific authorization, and (iv) the
      recorded accountability for assets is compared with existing assets at
      reasonable intervals and appropriate action is taken with respect to any
      differences.

     

    2.9 Absence
      of Litigation.
      Except
      as disclosed in the SEC Documents, there is no action, suit, proceeding or
      investigation before or by any court, public board, government agency,
      self-regulatory organization or body pending or, to the Company’s knowledge,
      threatened against the Company or any of its Subsidiaries that if determined
      adversely to the Company or any of its Subsidiaries would be reasonably likely
      to have a Material Adverse Effect. Neither the Company or any of its
      Subsidiaries, nor any director or officer thereof is, or within the last ten
      years has been, the subject of any action involving a claim of violation of
      or
      liability under federal or state securities laws or a claim of breach of
      fiduciary duty relating to the Company. There has not been, and to the knowledge
      of the Company, there is not pending or contemplated, any investigation by
      the
      SEC involving the Company or any of its Subsidiaries or any director or officer
      thereof. The Company has not received any stop order or other order suspending
      the effectiveness of any registration statement filed by the Company under
      the
      Exchange Act or the Securities Act and, to the Company’s knowledge, the SEC has
      not issued any such order.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    2.10 Intellectual
      Property Rights. 

     

    (a) The
      Company and its Subsidiaries own, or have sufficient rights to use and otherwise
      exercise and exploit and license, all patents, patent applications, trademarks,
      trademark applications, service marks, trade names, copyrights, licenses and
      other similar rights necessary or material for use in connection with (or
      otherwise used or anticipated to be used in) their respective businesses as
      currently being conducted as described in the SEC Documents, as previously
      conducted and as proposed to be conducted (collectively, the “Intellectual
      Property Rights”),
      except where the failure to own or license such Intellectual Property Rights
      would not, individually or in the aggregate, be reasonably likely to have a
      Material Adverse Effect. Except as set forth in the SEC Documents, neither
      the
      Company nor any Subsidiary has received any notice (including any offer of
      a
      license) that any past, current or proposed activity of (or any Intellectual
      Property Rights used, exploited or exercised by) the Company or any Subsidiary
      may violate or infringe upon the rights of any Person and neither has any reason
      to anticipate that any such notice may be forthcoming (or that there is or
      may
      be any basis therefor). Except as set forth in the SEC Documents, to the
      knowledge of the Company, all of the Intellectual Property Rights are
      enforceable and there is no existing or expected infringement (or challenge)
      by
      another Person of (or to) any of the Intellectual Property Rights. To the
      Company’s knowledge, no present or former employee, officer or director of the
      Company or any of its Subsidiaries, or agent or outside contractor of the
      Company or any of its Subsidiaries, holds any right, title or interest, directly
      or indirectly, in whole or in part, in or to any Intellectual Property Rights,
      except those formally assigned or transferred to the Company by such employees.
      The Company does not believe it is or will be necessary to utilize any
      inventions of any of its employees (or people it currently intends to hire)
      made
      prior to their employment by the Company, except those formally assigned or
      transferred to the Company by such employees.

     

    (b) To
      the
      Company’s knowledge: (i) no trade secret of the Company or any of its
      Subsidiaries has been used, disclosed or appropriated to the detriment of the
      Company or any of its Subsidiaries for the benefit of any Person other than
      the
      Company or its Subsidiaries; and (ii) no employee, independent contractor or
      agent of the Company or any of its Subsidiaries has misappropriated any trade
      secrets or other confidential information of any other Person in the course
      of
      the performance of his or her duties as an employee, independent contractor
      or
      agent of the Company or its Subsidiaries, except in the cases of clauses (i)
      and
      (ii) as would not, individually or in the aggregate, be reasonably likely to
      have a Material Adverse Effect.

     

    2.11 No
      Material Adverse Change.
      Since
      October 31, 2006, except as disclosed in the SEC Documents or has occurred
      in
      the ordinary course of business, there has been no (i) change, circumstance,
      development or event which, individually or in the aggregate, is reasonably
      likely to have a Material Adverse Effect, (ii) declaration, setting aside or
      payment of any dividend or other distribution with respect to the capital stock
      of the Company, (iii) issuance of capital stock (other than pursuant to (1)
      the
      exercise of options, warrants, or convertible securities outstanding at such
      date or (2) employee benefit plans) or options, warrants or rights to acquire
      capital stock (other than the rights granted (1) to the Purchaser hereunder
      or
      (2) pursuant to employee benefit plans), (iv) material loss, destruction or
      damage to any property of the Company or any of its Subsidiaries, whether or
      not
      insured, (v) acceleration of any indebtedness for borrowed money or the
      refunding of any such indebtedness, (vi) labor trouble involving the
      Company or any of its Subsidiaries or any material change in their personnel
      or
      the terms and conditions of employment, (vii) waiver of any valuable right
      in
      favor of the Company or any of its Subsidiaries, (viii) loan or extension of
      credit to any officer of the Company or any of its Subsidiaries or to any
      employee of the Company or any of its Subsidiaries in an amount in excess of
      $25,000 or (ix) acquisition or disposition of any material assets (or any
      contract or arrangement therefor), or any other material transaction by the
      Company or any of its Subsidiaries otherwise than for fair value in the ordinary
      course of business. The Company has not taken any steps to seek protection
      pursuant to any bankruptcy law nor does the Company have any knowledge or reason
      to believe that its creditors intend to initiate involuntary bankruptcy
      proceedings. 

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    2.12 Taxes.
      The
      Company and its Subsidiaries have filed (or have obtained an extension of time
      within which to file) all necessary federal, state and foreign income and
      franchise tax returns and has paid all taxes shown as due on such tax returns,
      except where the failure to so file or the failure to so pay would not,
      individually or in the aggregate, have a Material Adverse Effect. Each of the
      Company and its Subsidiaries has complied in all material respects with all
      applicable legal requirements relating to the payment and withholding of taxes
      and, within the time and in the manner prescribed by law, has withheld from
      wages, fees and other payments and paid over to the proper governmental or
      regulatory authorities all amounts required.

     

    2.13 Real
      and Personal Property.
      The
      Company and its Subsidiaries have good and marketable title to, or have valid
      rights to lease or otherwise use, all items of real and personal property that
      are material to the business of the Company and its Subsidiaries, free and
      clear
      of all liens, encumbrances, claims and defects and imperfections of title except
      those that (i) do not materially interfere with the use of such property by
      the
      Company and its Subsidiaries or (ii) would not, individually or in the
      aggregate, be reasonably likely to have a Material Adverse Effect.

     

    2.14 Material
      Contracts.

     

    (a) Except
      for contracts filed as exhibits to the SEC Documents (“Material
      Contracts”)
      and
      except for this Agreement and the Related Agreements, the Company does not
      have
      any agreements, contracts and commitments that are material to the business,
      financial condition, assets, prospects or operations of the Company or any
      of
      its Subsidiaries that would be required to be filed under the Exchange
      Act.

     

    (b) The
      Company is not in material default under or in violation of, nor to the
      Company’s knowledge, is there any valid basis for any claim of default under or
      violation of, any Material Contract. 

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (c) All
      agreements, contracts and commitments required to be filed by the Company under
      the Exchange Act or the Securities Act have been filed in a timely manner with
      the SEC.

     

    2.15 Employee
      Benefit Plans; Employee Matters.
      The
      consummation of the transactions contemplated by this Agreement and the Related
      Agreements will not (i) entitle any current or former employee or other service
      provider of the Company or any of its Subsidiaries to severance benefits or
      any
      other payment, compensation or benefit (including forgiveness of indebtedness),
      except as expressly provided by this Agreement, or (ii) accelerate the time
      of
      payment or vesting, or increase the amount of compensation or benefit due any
      such employee or service provider, alone or in conjunction with any other
      possible event (including termination of employment). The Company and its
      Subsidiaries are in compliance in all material respects with all currently
      applicable laws and regulations respecting employment, discrimination in
      employment, terms and conditions of employment, wages, hours and occupational
      safety and health and employment practices, and is not engaged in any unfair
      labor practice. To the Company’s knowledge, no employees of the Company or its
      Subsidiaries are in material violation of any term of any material employment
      contract, patent disclosure agreement, noncompetition agreement, or any
      restrictive covenant to a former employer relating to the right of any such
      employee to be employed by the Company (or its Subsidiaries) because of the
      nature of the business conducted or presently proposed to be conducted by the
      Company or its Subsidiaries or to the use of trade secrets or proprietary
      information of others. No key employee of the Company or any of its Subsidiaries
      has given written notice to the Company or its Subsidiaries, and the Company
      is
      not otherwise aware, that any such key employee intends to terminate his or
      her
      employment with the Company or any of its Subsidiaries.

     

    2.16 Environmental
      Laws.
      The
      Company is not in violation of any applicable statute, law or regulation
      relating to the environment or occupational health and safety, violation of
      which would, individually or in the aggregate, be reasonably likely to have
      a
      Material Adverse Effect. None of the premises or any properties owned, occupied
      or leased by the Company or any of its Subsidiaries have been used by the
      Company or any of its Subsidiaries, or to the Company’s knowledge, by any other
      Person to manufacture, treat, store, or dispose of any substance that have
      been
      designated to be a “hazardous substance” under applicable environmental laws in
      violation of any applicable environmental laws, violation of which would,
      individually or in the aggregate, be reasonably likely to have a Material
      Adverse Effect. 

     

    2.17 Compliance
      with Law.
      Neither
      the Company nor any of its Subsidiaries is in violation of any laws, ordinances,
      governmental rules or regulations to which it is subject, including ,without
      limitation laws or regulations relating to the environment or to occupational
      health and safety, except for violations that would not, individually or in
      the
      aggregate, be reasonably likely to have a Material Adverse Effect, and no
      material expenditures are known to be or expected to be required in order to
      cause its current operations or properties to comply with any such law,
      ordinances, governmental rules or regulations.

     

    2.18 Insurance.
      The
      Company and its Subsidiaries are insured by insurers of recognized financial
      responsibility against such losses and risks and in such amounts as the Company
      believes are prudent and customary for a company (i) in the business and stage
      of development and locations in which the Company or any of its Subsidiaries
      are
      engaged and (ii) with the resources of the Company and its Subsidiaries. The
      Company has not received any written notice that the Company or its Subsidiaries
      will not be able to renew its existing insurance coverage as and when such
      coverage expires. All of such policies are in full force and effect and are
      valid and enforceable in accordance with their terms, and the Company has
      complied with all material terms and conditions of such policies, including
      premium payments. The Company believes it will be able to obtain similar
      coverage at reasonable cost from similar insurers as may be necessary to
      continue its business. 

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    2.19 Foreign
      Corrupt Practices.
      Neither
      the Company or any of its Subsidiaries, nor to the Company’s knowledge, any
      director, officer, agent, employee or other Person acting on behalf of the
      Company or any of its Subsidiaries has, in the course of its actions for, or
      on
      behalf of, the Company or any of its Subsidiaries (i) used any corporate funds
      for any unlawful contribution, gift, entertainment or other unlawful expenses
      relating to political activity; (ii) made any direct or indirect unlawful
      payment to any foreign or domestic government official or employee from
      corporate funds; (iii) violated or is in violation of in any material respect
      any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended;
      or
      (iv) made or received any unlawful bribe, rebate, payoff, influence payment,
      kickback or other unlawful payment to or from any foreign or domestic government
      official or employee.

     

    2.20 Related
      Party Transactions.
      Except
      with respect to the transactions that are contemplated hereby or in the Related
      Agreements to the extent an Affiliate of any director or officer of the Company
      purchases Shares in the Offering and except with respect to transactions
      involving amounts less than $60,000, all transactions, including, without
      limitation, any contract, agreement or other arrangement providing for the
      furnishing of services, providing for rental of real estate or personal property
      or otherwise involving payments or obligations, that have occurred between
      or
      among the Company, on the one hand, and any of its officers or directors, or
      any
      Affiliate or Affiliates of any such executive officer or director, on the other
      hand, prior to the date hereof have been disclosed in the SEC Documents in
      accordance with the requirements of Item 404 of Regulation S-K under the
      Securities Act. 

     

    2.21 No
      Integration; General Solicitation.
      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 to be integrated with any prior offering by the Company for
      purposes of the Securities Act or any applicable stockholder approval provisions
      including, without limitation, under the rules and regulations of any exchange
      or quotation system on which any of the securities of the Company are listed
      or
      designated. Neither the Company nor any of its Affiliates, nor any Person acting
      on its or their behalf, has offered or sold, or authorized the offer or sale
      of,
      any of the Shares by any form of general solicitation or general advertising
      within the meaning of Rule 502(c) under the Securities Act. The Company has
      not
      publicly distributed and will not publicly distribute prior to the Closing
      Date
      any offering material in connection with the Offering. The Company has offered
      the Shares for sale only to the Purchaser and certain other “accredited
      investors” within the meaning of Rule 501 under the Securities Act and Persons
      who are not “US persons” within the meaning of Rule 902(k) under the Securities
      Act. The Company shall not directly or indirectly take, and shall not permit
      any
      of its directors, or officers indirectly to take, any action (including any
      offering or sale to any Person of the Shares) that will make unavailable the
      exemption from registration under the Securities Act being relied upon by the
      Company for the offer and sale to the Purchaser of the Shares as contemplated
      by
      this Agreement and the Related Agreements.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    2.22 No
      Registration Rights.
      No
      Person has the right to (i) prohibit, delay or suspend the Company from filing
      the Registration Statement and fully performing its obligations with respect
      thereto as contemplated hereunder or (ii) except for obligations under warrant
      agreements disclosed in the SEC Documents, require the Company to register any
      securities for sale under the Securities Act by reason of the filing of the
      Registration Statement and no other registration rights exist with respect
      to
      the issuance or registration of securities by the Company under the Securities
      Act which have not been satisfied. The granting and performance of the
      registration rights under this Agreement will not violate or conflict with,
      or
      result in a breach of any provision of, or constitute a default under, any
      agreement, indenture, or instrument to which the Company or any of its
      Subsidiaries is a party.

     

    2.23 NASDAQ.
      The
      Common Stock is registered pursuant to Section 12(g) of the Exchange Act, and
      is
      listed on NASDAQ, and trading in the Common Stock has not been suspended and
      the
      Company has taken no action designed to, or that is likely to have the effect
      of, terminating the registration of the Common Stock under the Exchange Act
      or
      delisting the Common Stock from the NASDAQ. To the Company’s knowledge, the
      Company and the Common Stock meet the criteria for continued listing and trading
      on NASDAQ.

     

    2.24 Investment
      Company.
      The
      Company is not and, after giving effect to the offering and sale of the Shares,
      will not be an “investment company” as such term is defined in the Investment
      Company Act of 1940, as amended (the “Investment
      Company Act”).
      The
      Company shall conduct its business in a manner so that it will not become
      subject to the Investment Company Act. 

     

    2.25 Acknowledgment
      Regarding Purchaser’s Purchase of Shares.
      The
      Company acknowledges and agrees that the Purchaser is acting solely in the
      capacity of an arm’s length purchaser with respect to this Agreement and the
      Related Agreements and the transactions contemplated hereby and thereby. The
      Company further acknowledges that the Purchaser is not acting as a financial
      advisor or fiduciary of the Company (or in any similar capacity with respect
      to
      the Company) with respect to this Agreement and the Related Agreements and
      the
      transactions contemplated hereby and thereby and any advice given by the
      Purchaser or any of its respective representatives or agents to the Company
      in
      connection with this Agreement and the Related Agreements and the transactions
      contemplated hereby and thereby is merely incidental to the Purchaser’s purchase
      of the Shares. The Company further represents to the Purchaser that the
      Company’s decision to enter into this Agreement and the Related Agreements has
      been based on the independent evaluation of the transactions contemplated hereby
      and thereby by the Company and its representatives.

     

    2.26 Accountants.
      KPMG
      LLP, which the Company expects will express its opinion with respect to the
      audited financial statements and schedules to be included as a part of the
      Registration Statement prior to the filing of the Registration Statement, has
      advised the Company that it is, and to the best knowledge of the Company it
      is,
      an independent accountant as required by the Sarbanes-Oxley Act of 2002, the
      Securities Act and the Exchange Act and the rules and regulations promulgated
      thereunder.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    2.27 Takeover
      Provision.
      The
      Company and its Board have taken all necessary action in order to render
      inapplicable any corporate takeover provision under laws of the State of
      Delaware, including Section 203 of the DGCL, or any other state or federal
“fair
      price”, “moratorium”, “control share acquisition”, “business combination” or
      other similar anti-takeover statute or regulation, poison pill (including any
      distribution under a rights agreement) or other similar anti-takeover provision
      under the Certificate of Incorporation or the Bylaws (each, a “Takeover
      Provision”)
      which
      is, or could be, applicable to the transactions contemplated by this Agreement,
      including,
      without
      limitation,
      the
      Company’s issuance of the Shares and the Purchaser’s ownership, voting (to the
      extent applicable) or disposition of the Shares.

     

    2.28 No
      Manipulation of Stock.
      The
      Company has not taken, nor will it take, directly or indirectly, any action
      outside the ordinary course of business designed to or that might reasonably
      be
      expected to cause or result in unlawful manipulation of the price of the Common
      Stock to facilitate the sale or resale of the Shares.

     

    2.29 Form
      S-3 Eligibility.
      The
      Company is eligible to register the resale of its Common Stock by the Purchaser
      under Form S-3 promulgated under the Securities Act.

     

    2.30 Vote
      Required.
      No vote
      of the holders of any class or series of the Company’s capital stock, including
      the Common Stock, is necessary to approve the issuance of the Shares and any
      other transactions contemplated by this Agreement or the Related
      Agreements. 

     

    2.31 Board
      Approval.
      The
      Board, at a meeting duly called and held, has (a) determined that the Offering
      is fair to, advisable and in the best interests of the Company and the
      stockholders of the Company, and (b) approved the Offering and this Agreement
      and the Related Agreements. 

     

    2.32 Sarbanes-Oxley
      Act.
      The
      Company is in compliance with any and all applicable requirements of the
      Sarbanes-Oxley Act of 2002, and any and all applicable rules and regulations
      promulgated by the SEC thereunder, except where such noncompliance would not,
      individually or in the aggregate, be reasonably likely to have a Material
      Adverse Effect. 

     

    2.33 Books
      and Records.
      The
      books of account, minute books, stock record books and other records of the
      Company and its Subsidiaries are complete and correct in all material respects
      and have been maintained in accordance with sound business practices and the
      requirements of Section 13(b)(2) of the Exchange Act, including an adequate
      system of internal controls.

     

    2.34 Transfer
      Taxes.
      On the
      Closing Date, all stock transfer or other taxes (other than income taxes) which
      are required to be paid in connection with the sale and transfer of the Shares
      hereunder will be, or will have been, fully paid or provided for by the Company
      and the Company will have complied with all laws imposing such
      taxes.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    2.35 Fees.
      The
      Company has taken no action that would give rise to any claim by any Person
      for
      brokerage commissions, placement agent’s fees or similar payments relating to
      this Agreement or the transactions contemplated hereby.

     

    ARTICLE
      3

     

    PURCHASER’S
      REPRESENTATIONS AND WARRANTIES

     

    The
      Purchaser represents and warrants to the Company as follows: 

     

    3.1 Investment
      Purpose.
      The
      Purchaser is purchasing the Shares for its own account for investment and not
      with a present view toward the public sale or distribution thereof and has
      no
      intention of selling or distributing any of such Shares or any arrangement
      or
      understanding with any other Persons regarding the sale or distribution of
      such
      Shares except as contemplated by this Agreement or the Related Agreements and
      in
      compliance with the Securities Act. The Purchaser will not, directly or
      indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit
      any offers to buy, purchase or otherwise acquire or take a pledge of) any of
      the
      Shares except in accordance with the provisions of this Agreement or the Related
      Agreements and in compliance with applicable securities laws. In making the
      representation herein, however, the Purchaser does not agree to hold any of
      the
      Shares for any minimum or other specified term and reserves the right to dispose
      of the Shares at any time in compliance with the Securities Act. 

     

    3.2 Purchaser
      Status; Questionnaires.
      At the
      time Purchaser was offered the Shares, it was, and at the date hereof it is:
      (i)
      an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7)
      and (a)(8) under the Securities Act or (ii) a Person who is not a “US person”
(as defined in Rule 902(k) under the Securities Act (a “Non-US
      Person”).
      All
      information provided by the Purchaser to the Company in connection with the
      Purchaser’s purchase of the Shares, including, but not limited to, the
      information provided in the Pre-Closing Securities Ownership Questionnaire
      attached hereto as Exhibit
      B,
      was
      accurate and correct when provided or delivered and is accurate and correct
      as
      of the date hereof.

     

    3.3 Reliance
      on Exemptions.
      The
      Purchaser understands that the Shares are being offered and sold to it in
      reliance upon specific exemptions from or non-application of the registration
      requirements of United States federal and state securities laws and that the
      Company is relying upon the truth and accuracy of, and the Purchaser’s
      compliance with, the representations, warranties, agreements, acknowledgments
      and understandings of the Purchaser set forth herein in order to determine
      the
      availability of such exemptions and the eligibility of the Purchaser to acquire
      the Shares.

     

    3.4 Information.
      The
      Purchaser acknowledges that it has been afforded (i) the opportunity to ask
      such
      questions as it has deemed necessary of, and to receive answers from,
      representatives of the Company concerning the terms and conditions of the
      offering of the Shares and the merits and risks of investing in the Shares;
      (ii)
      access to information about the Company and its financial condition, results
      of
      operations, businesses, properties, management and prospects sufficient to
      enable it to evaluate its investment, including, without limitation, the
      Company’s SEC Documents, and the Purchaser has had the opportunity to review the
      SEC Documents; and (iii) the opportunity to obtain such additional information
      that the Company possesses or can acquire without unreasonable effort or expense
      that is necessary to make an informed investment decision with respect to the
      investment. Neither such inquiries nor any other due diligence investigation
      conducted by such Purchaser or any of its advisors or representatives shall
      modify, amend or affect such Purchaser’s right to rely on the Company’s and its
      Subsidiaries representations, warranties and covenants contained herein or
      in
      the Related Agreements.

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    3.5 Acknowledgement
      of Risk.

     

    (a) The
      Purchaser acknowledges and understands that its investment in the Shares
      involves a significant degree of risk, including, without limitation, (i) the
      Company has a history of operating losses and requires substantial funds in
      addition to the proceeds from the sale of the Shares; (ii) an investment in
      the
      Company is speculative, and only the Purchaser who can afford the loss of their
      entire investment should consider investing in the Company and the Shares;
      (iii)
      the Purchaser may not be able to liquidate its investment; (iv) transferability
      of the Shares is limited; (v) in the event of a disposition of the Shares,
      the
      Purchaser could sustain the loss of its entire investment; and (vi) the Company
      has not paid any dividends on its Common Stock since inception and does not
      anticipate the payment of dividends in the foreseeable future. Such risks are
      more fully set forth in the SEC Documents. 

     

    (b) The
      Purchaser is able to bear the economic risk of holding the Shares for an
      indefinite period, and has knowledge and experience in financial and business
      matters such that it is capable of evaluating the risks of the investment in
      the
      Shares. 

     

    (c) The
      Purchaser has, in connection with the Purchaser’s decision to purchase the
      Shares and with respect to all matters relating to this Agreement and the
      Related Agreements and the transactions contemplated hereby and thereby, relied
      solely upon the advice of such Purchaser’s own counsel and has not relied upon
      or consulted any counsel to the Company.

     

    (d) The
      Purchaser is not purchasing the Shares as a result of any form of general
      solicitation or general advertising within the meaning of Rule 502(c) under
      the
      Securities Act.

     

    3.6 Governmental
      Review.
      The
      Purchaser understands that no United States federal or state or foreign agency
      or any other government or governmental agency has passed upon or made any
      recommendation or endorsement of the Shares or an investment
      therein.

     

    3.7 Transfer
      or Resale.
      The
      Purchaser understands that: 

     

    (a) the
      Shares have not been and are not being registered under the Securities Act
      (other than as contemplated in Article
      6
      of this
      Agreement) or any applicable state securities laws and, consequently, the
      Purchaser may have to bear the risk of owning the Shares for an indefinite
      period of time because the Shares may not be transferred unless (i) the resale
      of the Shares is registered pursuant to an effective registration statement
      under the Securities Act or exempt from the registration requirements of the
      Securities Act under Rule 144 thereunder; or (ii) the Purchaser has delivered
      to
      the Company an opinion of counsel to the Purchaser (in form, substance and
      scope
      customary for opinions of counsel in comparable transactions) to the effect
      that
      the Shares to be sold or transferred may be sold or transferred pursuant to
      an
      exemption from such registration, provided that no opinion shall be required
      by
      the Company in the case of transfers under Rule 144; and 

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    (b) except
      as
      set forth in Article
      6
      of this
      Agreement, neither the Company nor any other Person is under any obligation
      to
      register the resale of any Shares under the Securities Act or any state or
      foreign securities laws or to comply with the terms and conditions of any
      exemption thereunder.

     

    3.8 Legends.

     

    (a) The
      Purchaser understands the certificates representing the Shares will bear a
      restrictive legend in substantially the following form (and a stop-transfer
      order may be placed against transfer of the certificates for such
      securities):

     

    “THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE
      SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
      OF
      THE UNITED STATES IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR REGULATION S
      THEREUNDER, AND ACCORDINGLY, MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
      HYPOTHECATED, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO AN EFFECTIVE
      REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OR PURSUANT
      TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
      REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
      APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL
      TO
      THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
      ACCEPTABLE TO THE COMPANY.”

     

    (b) The
      Purchaser may request that the Company remove, and the Company agrees to
      authorize the removal of any legend from the Shares (i) following any sale
      of
      the Shares pursuant to an effective Registration Statement, or (ii) if such
      Shares are eligible for sale under Rule 144(k) or under any no-action letter
      issued by the SEC. Following the time a legend is no longer required for any
      Shares hereunder, the Company will, no later than five (5) Business Days
      following the delivery by the Purchaser to the Company or the Company’s transfer
      agent of a legended certificate representing such Shares, accompanied by such
      additional information as the Company or the Company’s transfer agent may
      reasonably request, deliver or cause to be delivered to the Purchaser a
      certificate representing such Shares that is free from all restrictive and
      other
      legends. 

     

    (c) Notwithstanding
      anything herein to the contrary, the Company acknowledges and agrees that the
      Company will not require an opinion of counsel in connection with the transfer
      by the Purchaser of any Shares to an Affiliate of the Purchaser.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    3.9 Authorization;
      Enforcement.
      The
      Purchaser is duly organized, validly existing and in good standing under the
      laws of its jurisdiction of formation and has the requisite power and authority
      to enter into this Agreement and the Related Agreements and to consummate the
      transactions contemplated hereby and thereby. The Purchaser has taken all
      necessary action to authorize the execution, delivery and performance of this
      Agreement and the Related Agreements. Upon the execution and delivery of this
      Agreement and the Related Agreements, this Agreement and the Related Agreements
      shall constitute a valid and binding obligation of the Purchaser enforceable
      in
      accordance with its terms, except as enforceability may be limited by applicable
      bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
      creditors’ and contracting parties’ rights generally and except as
      enforceability may be subject to general principles of equity and except as
      rights to indemnity and contribution may be limited by applicable securities
      laws or public policy underlying such laws.

     

    3.10 Residency.
      The
      Purchaser is a resident of the Republic of Korea. 

     

    3.11 No
      Short Sales.
      Between
      the time the Purchaser learned about the Offering and the public announcement
      of
      the Offering, the Purchaser has not engaged in any short sales or similar
      transactions with respect to the Common Stock, nor has the Purchaser, directly
      or indirectly, caused any Person to engage in any short sales or similar
      transactions with respect to the Common Stock.

     

    3.12 Brokers.
      The
      Purchaser has not engaged any brokers, finders or agents and has not incurred,
      and will not incur, directly or indirectly, any liability for brokerage for
      finder’s fees or agent’s commissions or any similar charges in connection with
      this Agreement and the Related Agreements. 

     

    3.13 Additional
      Representations by Non-US Person.
      The
      Purchaser who is a Non-US Person further represents and warrants to the Company
      with respect to itself and its purchase hereunder that: (i) the Purchaser’s
      principal address is outside of the United States; (ii) the Purchaser was
      located outside the United States at the time any offer to buy the Shares was
      made to it and at the time the buy order was originated by the Purchaser; (iii)
      the Purchaser is not an “affiliate” (as defined in Rule 144) of the Company or
      acting on behalf of an affiliate of the Company; and (iv) the Purchaser is
      an
“accredited investor” as defined in Rule 501(a) of Regulation D under the
      Securities Act. The Purchaser who is a Non-US Person hereby expressly agrees
      not
      to engage in hedging transactions with regard to the Shares unless in compliance
      with the Securities Act and the terms of this Agreement.

     

    ARTICLE
      4

     

    COVENANTS

     

    4.1 Reporting
      Status and Public Information.
      The
      Common Stock is registered under Section 12 of the Exchange Act. During the
      Registration Period, the Company agrees to use commercially reasonable efforts
      to (a) timely file all documents with the SEC, (b) make and keep public
      information available, as those terms are understood and defined in Rule 144
      under the Securities Act, at all times, (c) file with the SEC in a timely manner
      all reports and other documents required of the Company under the Exchange
      Act
      and (d) so long as a Holder owns any Registrable Securities, furnish to such
      Holder, upon any reasonable request, a written statement by the Company as
      to
      its compliance with Rule 144 under the Securities Act, and of the Exchange
      Act,
      a copy of the most recent annual or quarterly report of the Company, and such
      other reports and documents of the Company as such Holder may reasonably request
      in availing itself of any rule or regulation of the SEC allowing a Holder to
      sell any such securities without registration. During the Registration Period,
      the Company will not terminate its status as an issuer required to file reports
      under the Exchange Act even if the Exchange Act or the rules and regulations
      thereunder would permit such termination.

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    4.2 Financial
      Information.
      The
      financial statements of the Company to be included in any documents filed with
      the SEC will be prepared in accordance with accounting principles generally
      accepted in the United States, consistently applied (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, may be condensed or summary statements or may conform to the SEC’s
      rules and instructions for Reports on Form 10-Q), and will fairly present in
      all
      material respects the consolidated financial position of the Company and
      consolidated results of its operations and cash flows as of, and for the periods
      covered by, such financial statements (subject, in the case of unaudited
      statements, to normal year-end audit adjustments).

     

    4.3 Securities
      Laws Disclosure; Publicity. 

     

    (a) Except
      as
      may be required by law or the rules of the SEC or NASDAQ, neither the Company
      nor any Subsidiary shall use the name of, or make reference to, the Purchaser
      or
      any of its Affiliates in any press release or in any public manner (including
      any reports or filings made by the Company under the Exchange Act) without
      the
      Purchaser’s prior written consent, which consent shall not be unreasonably
      withheld or delayed. Any press release of the Company shall be approved by
      the
      Purchaser, which approval will not be unreasonably withheld or
      delayed.

     

    (b) Within
      four (4) Business Days after the Closing Date, the Company shall file a Current
      Report on Form 8-K with the SEC describing the terms of the transactions
      contemplated by this Agreement and the Related Agreements and including as
      an
      exhibit to such Current Report on Form 8-K this Agreement, in the form required
      by the Exchange Act. 

     

    4.4 Covenants
      Pending Closing.
      Prior
      to the Closing, the Company shall maintain its existence and conduct and cause
      its Subsidiaries to conduct their respective businesses in usual, regular and
      ordinary course in substantially the same manner as heretofore conducted, and
      shall not, and shall not permit its Subsidiaries to, without the prior written
      consent of the Purchaser, such consent not to be unreasonably withheld, delayed
      or conditioned, take any action which would result in any of the representations
      or warranties contained in this Agreement not being true or correct at and
      as of
      the time immediately after such action, or in any of the covenants contained
      in
      this Agreement becoming incapable of performance. The Company will promptly
      advise the Purchaser of any action or event of which it becomes aware which
      has
      the effect of making materially incorrect any of such representations or
      warranties or which has the effect of rendering any of such covenants incapable
      of performance.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    4.5 Limits
      on Additional Issuances.
      Neither
      the Company, any of its Subsidiaries nor any of their respective Affiliates
      will
      sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
      of any “security” (as defined in the Securities Act) that could be integrated
      with the sale of the Securities in a manner that could require the registration
      of the Securities under the Securities Act.

     

    4.6 Sales
      by Purchaser.
      The
      Purchaser agrees that it will comply with the prospectus delivery requirements
      of the Securities Act as applicable to it in connection with the sales of
      Registrable Securities pursuant to the Registration Statement or otherwise
      comply with the requirements for an exemption from registration under the
      Securities Act and the rules and regulations promulgated thereunder. The
      Purchaser will not make any sale, transfer, pledge or other disposition of
      the
      Shares in violation of U.S. federal or state or foreign securities laws or
      the
      terms of this Agreement. 

     

    4.7 Further
      Assurances.
      Each of
      the parties shall execute such documents and other papers and take such further
      actions as may be reasonably required or desirable to carry out the provisions
      hereof and the transactions contemplated hereby. Each such party shall use
      its
      reasonable efforts to fulfill or obtain the fulfillment of the conditions to
      the
      Closing as promptly as practicable.

     

    4.8 Consents
      and Approvals.
      From
      and after the date hereof, the Company shall use its reasonable best efforts
      to
      obtain as promptly as practicable any consent or approval of any Person,
      including any regulatory authority, required in connection with the transactions
      contemplated hereby.

     

    4.9 No
      Solicitation.
      The
      Company will not, and will not permit any of its Subsidiaries or any of their
      respective Affiliates to, engage in any form of general solicitation or general
      advertising (as those terms are used in Regulation D under the Securities Act)
      in connection with the offering of the Shares or in any manner involving a
      public offering within the meaning of Section 4(2) of the Securities
      Act.

     

    4.10 Form
      D
      and Blue Sky.
      The
      Company agrees to timely file a Form D with the SEC with respect to the Shares
      to the extent required under Regulation D of the Securities Act and to provide,
      upon request, a copy thereof to the Purchaser. The Company shall, on or before
      the Closing Date, take such action as the Company shall reasonably determine
      is
      necessary in order to obtain an exemption for, or to qualify the Shares for,
      sale to the Purchaser at the Closing pursuant to this Agreement under applicable
      securities and “blue sky” laws of the states of the United States (or to obtain
      an exemption from such qualification), and shall provide evidence of any such
      action so taken to the Purchaser on or prior to the Closing Date. The Company
      shall make all timely filings and reports relating to the offer and sale of
      the
      Shares required under applicable securities and “blue sky” laws of the states of
      the United States following the Closing Date. The Company shall pay all fees
      and
      expenses in connection with satisfying its obligations under this Section
      4.10.

     

    4.11 Efforts
      to Satisfy Conditions.
      Each
      party shall use its commercially reasonable efforts to satisfy each of the
      conditions to be satisfied by it as provided in Article
      5
      of this
      Agreement.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    4.12 Use
      of
      Proceeds.
      The
      proceeds received by the Company from the issuance and sale of the Shares shall
      be used by the Company for working capital and other general corporate
      purposes.

     

    4.13 Expenses.
      The
      Company and the Purchaser is liable for, and will pay, its own expenses incurred
      in connection with the negotiation, preparation, execution and delivery of
      this
      Agreement, including, without limitation, attorneys’ and consultants’ fees and
      expenses.

     

    ARTICLE
      5

     

    CONDITIONS
      TO CLOSING

     

    5.1 Conditions
      to Obligations of the Company.
      The
      obligation of the Company to issue and deliver the Shares on the Closing Date
      shall be subject to the performance by the Purchaser of its agreements
      theretofore to be performed hereunder and to the satisfaction (or waiver),
      prior
      thereto or concurrently therewith, of the following further
      conditions:

     

    (a) Receipt
      of Purchase Price.
      The
      Company shall have received payment of the Purchase Price for the Shares being
      purchased hereunder. The Purchase Price shall be paid in immediately available
      funds, in US dollars.

     

    (b) Representations
      and Warranties.
      The
      representations and warranties of the Purchaser contained in Article
      3
      shall be
      true in all material respects on and as of the Closing Date (except for such
      representations and warranties that are qualified as to materiality, which
      shall
      be true in all respects) as though such representations and warranties were
      made
      at and as of such date.

     

    (c) Compliance
      with Agreement.
      The
      Purchaser shall have performed and complied in all material respects with all
      agreements, covenants and conditions contained in this Agreement which are
      required to be performed or complied with by them prior to or on the Closing
      Date.

     

    (d) Absence
      of Litigation.
      No
      proceeding challenging this Agreement or the Related Agreements or the
      transactions contemplated hereby or thereby, or seeking to prohibit, alter,
      prevent or materially delay the Closing, shall have been instituted or be
      pending before any court, arbitrator, governmental body, agency or
      official.

     

    (e) No
      Governmental Prohibition or Third Party Approval.
      The
      sale of the Shares by the Company shall not be prohibited by any law or
      governmental order or regulation and any government regulatory or third party
      consents or approvals, if any, necessary for the sale of the Shares shall have
      been received.

     

    (f) Purchaser
      Certificate.
      The
      Company shall have received a certificate from the Purchaser, dated the Closing
      Date, signed by a duly authorized representative of the Purchaser, certifying
      that the conditions specified in Sections
      5.1(b)
      and
5.1(c)
      hereof
      have been fulfilled.

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    (g) Pre-Closing
      Securities Ownership Questionnaire.
      The
      Purchaser shall have delivered to the Company a properly completed and executed
      Pre-Closing Securities Ownership Questionnaire, substantially in the form
      attached hereto as Exhibit
      B.

     

    (h) Alliance
      Agreement.
      The
“Effective Date” as defined in the Alliance Agreement shall have
      occurred.

     

    (i) Closing
      Deliverables.
      The
      Company shall have received all documents and other items required to be
      delivered by the Purchaser to the Company pursuant to Section
      1.5
      and as
      are reasonably required to be delivered by the Purchaser to effectuate the
      transactions contemplated by this Agreement and the Related
      Agreements.

     

    5.2 Conditions
      to Purchaser’s Obligations at the Closing.
      The
      obligation of the Purchaser to purchase and pay for the Shares on the Closing
      Date shall be subject to the performance by the Company of its agreements
      theretofore to be performed hereunder and to the satisfaction (or waiver),
      prior
      thereto or concurrently therewith, of the following further
      conditions:

     

    (a) Representations
      and Warranties.
      The
      representations and warranties of the Company contained in this Agreement shall
      be true on and as of the Closing Date in all material respects (except for
      such
      representations and warranties that are qualified as to materiality, which
      shall
      be true in all respects) as though such representations and warranties were
      made
      at and as of such date.

     

    (b) Compliance
      with Agreement.
      The
      Company shall have performed and complied in all material respects with all
      agreements, covenants and conditions contained in this Agreement which are
      required to be performed or complied with by the Company prior to or on the
      Closing Date.

     

    (c) Compliance
      with Laws.
      The
      purchase of the Shares by the Purchaser hereunder shall be legally permitted
      by
      all laws and regulations to which the Purchaser or the Company is subject
      (including all applicable federal, state and foreign securities
      laws).

     

    (d) Legal
      Opinion.
      The
      Purchaser shall have received an opinion, dated the Closing Date from the
      Company’s counsel, Robinson and Cole LLP, substantially in the form of
Exhibit
      C
      attached
      hereto.. 

     

    (e) No
      Material Adverse Effect.
      There
      shall have been no developments in the business of the Company or its
      Subsidiaries which would be reasonably likely to have a Material Adverse
      Effect.

     

    (f) Absence
      of Litigation.
      No
      proceeding challenging this Agreement or the Related Agreements or the
      transactions contemplated hereby or thereby, or seeking to prohibit, alter,
      prevent or materially delay the Closing, shall have been instituted or be
      pending before any court, arbitrator, governmental body, agency or
      official.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    (g) No
      Governmental Prohibition or Third Party Consents.
      The
      sale of the Shares by the Company shall not be prohibited by any law or
      governmental order or regulation and any governmental, regulatory or third
      party
      consents or approvals, if any, necessary for the sale of the Shares shall have
      been received. 

     

    (h) NASDAQ
      Trading.
      Trading
      in the Common Stock shall not have been suspended by the SEC or NASDAQ, and
      trading in securities generally as reported by NASDAQ shall not have been
      suspended or limited, and the Common Stock shall not have been delisted on
      NASDAQ.

     

    (i) Officer’s
      Certificate.
      The
      Purchaser shall have received a certificate, dated the Closing Date, signed
      by a
      duly authorized executive officer of the Company, certifying that the conditions
      specified in the foregoing Sections
      5.2(a),
      5.2(b),
      5.2(e),
      5.2(f),
      5.2(g)
      and
5.2(i)
      hereof
      have been fulfilled.

     

    (j) Secretary’s
      Certificate.
      The
      Purchaser shall have received a certificate, dated the Closing Date, of the
      Secretary of the Company attaching: (i) a true and complete copy of the
      Certificate of Incorporation, in effect as of such date; (ii) a true and
      complete copy of the Bylaws, in effect as of such date; (iii) a certificate,
      dated within thirty (30) days prior to the Closing Date, from the Secretary
      of
      State of the State of Delaware as to the good standing of the Company; (iv)
      certificates of good standing, dated within thirty (30) days prior the Closing
      Date, from the appropriate officials of the jurisdictions in each state in
      which
      the Company is qualified to do business as a foreign corporation; and (iv)
      resolutions of the Board authorizing the execution and delivery of this
      Agreement, the transactions contemplated hereby, the approvals contemplated
      by
Sections
      2.30
      and
2.31
      herein
      and the issuance of the Shares.

     

    (k) Approval
      of Proceedings.
      All
      proceedings to be taken in connection with the transactions contemplated by
      this
      Agreement, and all documents incident thereto, shall be satisfactory in form
      and
      substance to the Purchaser and its counsel. The Purchaser shall have received
      copies of all documents or other evidence which they and their counsel may
      reasonably request in connection with such transactions and of all records
      of
      corporate proceedings in connection therewith in form and substance reasonably
      satisfactory to the Purchaser and their counsel.

     

    (l) Closing
      Deliverables.
      The
      Purchaser shall have received all documents and other items required to be
      delivered by the Company to the Purchaser pursuant to Section
      1.6
      and as
      are reasonably required to be delivered by the Company to effectuate the
      transactions contemplated by this Agreement and the Related
      Agreements.

     

    (m) Alliance
      Agreement.
      The
“Effective Date” as defined in the Alliance Agreement shall have
      occurred.

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

    
       

      ARTICLE
        6

       

      REGISTRATION
        RIGHTS

       

      6.1 Mandatory
        Registration.
        As soon
        as reasonably practicable after six (6) months after the Closing, the Company
        shall prepare, and, as soon as practicable, but in no event later than thirty
        (30) days after such date (the “Filing
        Deadline”),
        file
        with the SEC a Registration Statement or Registration Statements (as necessary)
        on Form S-3. In the event that Form S-3 is unavailable for such a registration,
        the Company shall use such other form as is available for such a registration,
        subject to the provisions of Section
        6.4.
        The
        Company shall use its best efforts to cause such Registration Statement to
        be
        declared effective by the SEC as soon as possible, but in no event later
        than
        the fifth Business Day after the SEC advises the Company that either (A)
        it will
        not review such Registration Statement or (B) it has no further comments
        with
        respect to such Registration Statement (the “Effectiveness
        Deadline”).

       

      6.2 Demand
        Registrations.
        If for
        any reason prior to the expiration of the Registration Period, a Registration
        Statement required to be filed pursuant to Section
        6.1
        ceases
        to be effective or fails to cover all of the Registrable Securities required
        to
        be covered by such Registration Statement, a Holder may demand registration
        pursuant to the terms of and within the time frames set forth in Section
        6.1
        by
        providing written demand registration notice to the Company (a “Demand
        Registration”).
        The
        Company shall amend the applicable Registration Statement, or file a new
        Registration Statement (on the short form available therefore, if applicable),
        or both, so as to cover all of the Registrable Securities required to be
        covered
        by a Registration Statement hereunder, as soon as practicable, but in any
        event
        not later than ten (10) Business Days after the date that the Demand
        Registration notice is delivered to the Company. The Company shall use its
        best
        efforts to cause such amendment and/or new Registration Statement to become
        effective as soon as practicable following the filing thereof. The compliance
        by
        the Company with the provisions of this Section
        6.2
        shall
        not relieve the Company of any liability for a breach of this Agreement,
        including, without limitation, any breach by the Company of Section
        6.1
        hereof,
        and the Holder shall retain any remedies available at law or in equity with
        respect thereto. 

       

      6.3 Piggy-Back
        Registrations.
        If at
        any time prior to the expiration of the Registration Period, the number of
        shares of Common Stock available for sale under a Registration Statement
        is
        insufficient to cover all of the Registrable Securities and the Company proposes
        to file with the SEC a Registration Statement relating to an offering for
        its
        own account or the account of others under the Securities Act of any of its
        securities (other than on Form S-4 or Form S-8 (or their equivalents at such
        time) relating to securities to be issued solely in connection with any
        acquisition of any entity or business or to equity securities issuable in
        connection with stock option or other employee benefit plans approved by
        the
        Board), the Company shall promptly send to the Holder written notice of the
        Company’s intention to file a Registration Statement and of the Holder’s rights
        under this Section
        6.3
        and, if
        within twenty (20) days after receipt of such notice, the Holder shall so
        request in writing, the Company shall include in such Registration Statement
        all
        or any part of the Registrable Securities the Holder requests to be registered,
        subject to the priorities set forth in this Section
        6.3
        below.
        No right to registration of Registrable Securities under this Section
        6.3
        shall be
        construed to limit any registration required under Section
        6.1
        or
6.2.
        The
        obligations of the Company under this Section
        6.3
        may be
        waived by the Holder, provided such Holder is not named as a selling
        securityholder in any Registration Statement. If an offering in connection
        with
        which a Holder is entitled to registration under this Section
        6.3
        is an
        underwritten offering, then such Holder whose Registrable Securities are
        included in such Registration Statement shall, unless otherwise agreed by
        the
        Company, offer and sell such Registrable Securities in an underwritten offering
        using the same underwriter or underwriters and, subject to the provisions
        of
        this Article
        6,
        on the
        same terms and conditions as other shares of Common Stock included in such
        underwritten offering. If a registration pursuant to this Section
        6.3
        is to be
        an underwritten public offering and the managing underwriter(s) advise the
        Company in writing that, in their reasonable good faith opinion, marketing
        or
        other factors dictate that a limitation on the number of shares of Common
        Stock
        which may be included in the Registration Statement is necessary to facilitate
        and not adversely affect the proposed offering, then the Company shall include
        in such registration: (1) first, all securities the Company proposes to sell
        for
        its own account and (2) second, up to the full number of securities proposed
        to
        be registered for the account of the Holder entitled to registration under
        this
Section
        6.3,
        pro
        rata to such Holder on the basis of the number of Registrable Securities
        that it
        requested to be included in such registration.

       

      
        
          
          

        

        
          -22-

          
            

          

        

        
          
          

        

      

       

      6.4 Ineligibility
        for Form S-3.
        Subject
        to Section
        6.1
        as it
        relates to the use of Form S-1, in the event that Form S-3 is not available
        for
        any registration of Registrable Securities hereunder, the Company shall (i)
        register the sale of the Registrable Securities on another appropriate form
        reasonably acceptable to the Holder and (ii) undertake to register the
        Registrable Securities on Form S-3 as soon as such form is available, provided
        that the Company shall maintain the effectiveness of the Registration Statement
        then in effect until such time as a Registration Statement on Form S-3 covering
        the Registrable Securities has been declared effective by the SEC.

       

      6.5 Failure
        to File, Obtain and Maintain Effectiveness of Registration
        Statement.
        If a
        Registration Delay occurs the Company shall pay to a Holder of Registrable
        Securities (the “Registration
        Delay Payments”),
        as
        partial relief for the damages to such Holder by reason of any such Registration
        Delay, and calculated for each share of Common Stock for which a Registration
        Statement is required to be filed pursuant to the terms of Section
        6.1
        then
        outstanding that is a Registrable Security and not covered for resale at
        such
        time pursuant to the terms of a Registration Statement, an accruing amount
        per
        each such share equal to the Delay Payment Rate for each week (or portion
        thereof) during the Damages Accrual Period. The Registration Delay Payments
        shall accrue from the first day of the applicable Registration Delay through
        the
        date it is cured (the “Damages
        Accrual Period”),
        and
        shall be payable in cash to the record holder of the Registrable Securities
        entitled thereto on the earlier of the (i) last Business Day of each calendar
        month during which such Registration Delay Payments are incurred and (ii)
        the
        third Business Day after the event of failure giving rise to the Registration
        Delay Payments is cured. Nothing shall preclude a Holder from pursuing or
        obtaining any available remedies at law, specific performance or other equitable
        relief with respect to this Article
        6
        in
        accordance with applicable law. 

       

      
        
          
          

        

        
          -23-

          
            

          

        

        
          
          

        

         

      

      6.6 Related
        Obligations.
        At such
        time as the Company is obligated to file a Registration Statement with the
        SEC
        pursuant to Section
        6.1,
        the
        Company will use its best efforts to effect the registration of the Registrable
        Securities in accordance with the intended method of distribution thereof
        and,
        pursuant thereto, the Company shall have the following obligations during
        the
        Registration Period (as hereinafter defined): 

       

      (a) The
        Company shall promptly prepare and file with the SEC a Registration Statement
        with respect to the Registrable Securities (but in no event later than the
        Filing Deadline) and use its best efforts to cause such Registration Statement
        relating to the Registrable Securities to become effective as soon as
        practicable after such filing (but in no event later than the applicable
        Effectiveness Deadline). The Company shall keep each Registration Statement
        effective pursuant to Rule 415 at all times until the earliest of (i) the
        three-year anniversary of the Closing Date; (ii) the date as of which the
        Holder
        may sell all of the Registrable Securities covered by such Registration
        Statement without restriction pursuant to Rule 144(k) promulgated under the
        Securities Act (or successor thereto) or (iii) the date on which the Holder
        shall have sold all the Registrable Securities covered by such Registration
        Statement either pursuant to the Registration Statement or in one or more
        transactions in which the Holder obtained unlegended certificates representing
        the Registrable Securities so purchased in accordance with applicable securities
        laws (the “Registration
        Period”),
        which
        Registration Statement (including any amendments or supplements thereto and
        prospectuses contained therein) shall not contain any untrue statement of
        a
        material fact or omit to state a material fact required to be stated therein,
        or
        necessary to make the statements therein (in the case of any prospectus only,
        in
        light of the circumstances under which they were made) not
        misleading.

       

      (b) The
        Company shall prepare and file with the SEC such amendments (including
        post-effective amendments) and supplements to a Registration Statement and
        the
        prospectus used in connection with such Registration Statement, which prospectus
        is to be filed pursuant to Rule 424 promulgated under the Securities Act,
        as may
        be necessary to keep such Registration Statement effective at all times during
        the Registration Period, and, during such period, comply with the provisions
        of
        the Securities Act with respect to the disposition of all Registrable Securities
        of the Company covered by such Registration Statement until such time as
        all of
        such Registrable Securities shall have been disposed of in accordance with
        the
        intended methods of distribution by the seller or sellers thereof as set
        forth
        in such Registration Statement. In the case of amendments and supplements
        to a
        Registration Statement which are required to be filed pursuant to this
Article
        6
        (including pursuant to this Section
        6.6(b))
        by
        reason of the Company filing a report on Form 10-K, Form 10-Q or Form 8-K
        or any
        analogous report under the Exchange Act), the Company shall have incorporated
        such report by reference into the Registration Statement, if applicable,
        or
        shall file such amendments or supplements with the SEC on the same day on
        which
        the Exchange Act report is filed which created the requirement for the Company
        to amend or supplement the Registration Statement.

       

      (c) The
        Company shall (i) permit a legal counsel for the Holder to review and comment
        upon those sections of (a) the Registration Statement which are applicable
        to
        the Holder at least five (5) Business Days prior to its filing with the SEC
        and
        (b) all other Registration Statements and all amendments and supplements
        to all
        Registration Statements which are applicable to the Holder (except for Annual
        Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports
        on Form
        8-K and any similar or successor reports) within a reasonable number of days
        prior to their filing with the SEC and (b) not file any Registration Statement
        (including any amendment or supplement thereto) or document in a form to
        which
        such legal counsel reasonably objects. The Company shall furnish to such
        legal
        counsel, without charge, (i) any correspondence from the SEC or the staff
        of the
        SEC to the Company or its representatives relating to any Registration
        Statement, provided the legal counsel shall keep such correspondence
        confidential and shall not provide copies thereof to the Holder without the
        Company’s prior consent, (ii) promptly after the same is prepared and filed with
        the SEC, one copy of any Registration Statement and any amendment(s) thereto,
        including financial statements and schedules, all documents incorporated
        therein
        by reference, if requested by a Holder, and all exhibits and (iii) upon the
        effectiveness of any Registration Statement, one copy of the prospectus included
        in such Registration Statement and all amendments and supplements thereto.
        The
        Company shall reasonably cooperate with a Holder’s legal counsel in performing
        the Company’s obligations pursuant to Section
        6.6.
        

       

      
        
          
          

        

        
          -24-

          
            

          

        

        
          
          

        

      

       

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

       

      (e) If
        required under applicable law, the Company shall use its best efforts to
        (i)
        register and qualify the Registrable Securities covered by a Registration
        Statement under all other securities or “blue sky” laws of such jurisdictions in
        the United States, (ii) prepare and file in those jurisdictions, such amendments
        (including post-effective amendments) and supplements to such registrations
        and
        qualifications as may be necessary to maintain the effectiveness thereof
        during
        the Registration Period, (iii) take such other actions as may be necessary
        to
        maintain such registrations and qualifications in effect at all times during
        the
        Registration Period, and (iv) take all other actions reasonably necessary
        or
        advisable to qualify the Registrable Securities for sale in such jurisdictions;
        provided, however, that the Company shall not be required in connection
        therewith or as a condition thereto to (w) make any change in the Company’s
        Certificate of Incorporation or Bylaws that the Board determines in good
        faith
        to be contrary to the best interests of the Company and its stockholders,
        (x)
        qualify to do business in any jurisdiction where it would not otherwise be
        required to qualify but for this Section
        6.6(e),
        (y)
        subject itself to general taxation in any such jurisdiction, or (z) file
        a
        general consent to service of process in any such jurisdiction. The Company
        shall promptly notify a Holder who holds Registrable Securities of the receipt
        by the Company of any notification with respect to the suspension of the
        registration or qualification of any of the Registrable Securities for sale
        under the securities or “blue sky” laws of any jurisdiction in the United States
        or its receipt of actual notice of the initiation or threat of any proceeding
        for such purpose.

       

      
        
          
          

        

        
          -25-

          
            

          

        

        
          
          

        

      

       

      (f) As
        promptly as practicable after becoming aware of such event or development,
        the
        Company shall notify a Holder in writing of the happening of any event as
        a
        result of which the prospectus included in a Registration Statement, as then
        in
        effect, includes an untrue statement of a material fact or omission to state
        a
        material fact required to be stated therein or necessary to make the statements
        therein, in light of the circumstances under which they were made, not
        misleading, and promptly prepare a supplement or amendment to such Registration
        Statement to correct such untrue statement or omission, and deliver ten (10)
        copies of such supplement or amendment to the Holder (or such other number
        of
        copies as such Holder may reasonably request). The Company shall also promptly
        notify a Holder in writing (i) when a prospectus or any prospectus supplement
        or
        post-effective amendment has been filed, and when a Registration Statement
        or
        any post-effective amendment has become effective (notification of such
        effectiveness shall be delivered to a Holder by facsimile on the same day
        of
        such effectiveness and by overnight mail), (ii) of any request by the SEC
        for
        amendments or supplements to a Registration Statement or related prospectus
        or
        related information, and (iii) of the Company’s reasonable determination that a
        post-effective amendment to a Registration Statement would be
        appropriate.

       

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

       

      (h) At
        the
        reasonable request of a Holder and at such Holder’s expense, the Company shall
        use its best efforts to furnish to such Holder, on the date of the effectiveness
        of the Registration Statement and thereafter from time to time on such dates
        as
        a Holder may reasonably request (i) a letter, dated such date, from the
        Company’s independent certified public accountants in form and substance as is
        customarily given by independent certified public accountants to underwriters
        in
        an underwritten public offering, and (ii) an opinion, dated as of such date,
        of
        counsel representing the Company for purposes of such Registration Statement,
        in
        form, scope and substance as is customarily given in an underwritten public
        offering, addressed to the Holder. 

       

      (i) The
        Company shall, upon reasonable notice and during normal business hours, make
        available for inspection by (i) the Holder, (ii) any legal counsel representing
        an Holder and (iii) one firm of accountants or other agents retained by such
        Holder (collectively, the “Inspectors”)
        all
        pertinent financial and other records, and pertinent corporate documents
        and
        properties of the Company (collectively, the “Records”),
        which
        are requested for any purpose reasonably related to a Holder’s rights and/or the
        Company’s obligations under this Article
        6,
        and
        cause the Company’s officers, directors and employees to supply all information
        which any Inspector may reasonably request; provided,
        however,
        that
        each Inspector which is not a party hereto shall agree in writing prior to
        obtaining access to any Records, and a Holder hereby agrees, to hold in strict
        confidence and shall not make any disclosure (except to a Holder similarly
        bound
        by the terms hereof) or use of any Record or other information which the
        Company
        determines in good faith to be confidential, and of which determination the
        Inspectors are so notified, unless (a) the disclosure of such Records is
        necessary to avoid or correct a misstatement or omission in any Registration
        Statement or is otherwise required under the Securities Act, (b) the release
        of
        such Records is ordered pursuant to a final, non-appealable subpoena or order
        from a court or government body of competent jurisdiction, or (c) the
        information in such Records has been made generally available to the public
        other than by disclosure in violation of this or any other agreement of which
        the Inspector has knowledge. The Holder receiving the Records agrees that
        it
        shall, if permitted by applicable law, upon learning that disclosure of such
        Records is sought in or by a court or governmental body of competent
        jurisdiction or through other means, give prompt notice to the Company prior
        to
        making any such disclosure and allow the Company, at its expense, to undertake
        appropriate action to prevent disclosure of, or to obtain a protective order
        for, the Records deemed confidential. The Holder undertaking an inspection
        pursuant to this Section
        6.6(i)
        shall,
        and shall instruct its other Inspectors to, use commercially reasonable efforts
        to perform any such inspection in a manner designed to not materially disrupt
        the business activities of the Company. Nothing herein (or in any other
        confidentiality agreement between the Company and a Holder) shall be deemed
        to
        limit the Holder’s ability to sell Registrable Securities in a manner which is
        otherwise consistent with applicable laws and regulations.

       

      
        
          
          

        

        
          -26-

          
            

          

        

        
          
          

        

      

       

      (j) The
        Company shall hold in confidence and not make any disclosure of information
        concerning a Holder provided to the Company unless (i) disclosure of such
        information is necessary to comply with federal or state securities laws
        or the
        rules of NASDAQ, (ii) the disclosure of such information is necessary to
        avoid
        or correct a misstatement or omission in any Registration Statement, (iii)
        the
        release of such information is ordered pursuant to a subpoena or other final,
        non-appealable order from a court or governmental body of competent
        jurisdiction, (iv) such information has been made generally available to
        the
        public other than by disclosure in violation of this Article
        6
        or any
        other agreement, or (v) such Holder expressly consents in writing to the
        form
        and content of any such disclosure. The Company agrees that it shall, if
        permitted by applicable law, upon learning that disclosure of such information
        concerning a Holder is sought in or by a court or governmental body of competent
        jurisdiction or through other means, give prompt written notice to such Holder
        prior to making any such disclosure and allow such Holder, at the Holder’s
        expense, to undertake appropriate action to prevent disclosure of, or to
        obtain
        a protective order for, such information.

       

      (k) The
        Company shall use its best efforts either to (i) cause all the Registrable
        Securities covered by a Registration Statement to be listed on each securities
        exchange on which securities of the same class or series issued by the Company
        are then listed, if any, if the listing of such Registrable Securities is
        then
        permitted under the rules of such exchange, or (ii) secure designation and
        quotation of the Shares on NASDAQ. The Company shall pay all fees and expenses
        in connection with satisfying its obligation under this Section
        6.6(k).

       

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

       

      
        
          
          

        

        
          -27-

          
            

          

        

        
          
          

        

      

       

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

       

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

       

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

       

      (p) Notwithstanding
        anything to the contrary in this Section
        6.6,
        at any
        time after the applicable Registration Statement has been declared effective
        by
        the SEC, the Company may delay the disclosure of material non-public information
        concerning the Company the disclosure of which at the time is not, in the
        good
        faith opinion of the Board and its counsel, in the best interest of the Company
        and, in the opinion of counsel to the Company, otherwise required (a
“Grace
        Period”);
        provided,
        that
        the Company shall promptly (i) notify the Holder in writing of the existence
        of
        material non-public information giving rise to a Grace Period (provided that
        in
        each notice the Company will not disclose the content of such material
        non-public information to the Holder) and the date on which the Grace Period
        will begin, and (ii) notify the Holder in writing of the date on which the
        Grace
        Period ends; and, provided further, that no Grace Periods shall exceed sixty
        (60)] consecutive days and during any consecutive three hundred sixty (360)
        day
        period, such Grace Periods shall not exceed an aggregate of one hundred twenty
        (120) days and the first day of any Grace Period must be at least five (5)
        trading days after the last day of any prior Grace Period (an “Allowable
        Grace Period”).
        For
        purposes of determining the length of a Grace Period above, the Grace Period
        shall begin on and include the date the Holder receives the notice referred
        to
        in clause (i) and shall end on and include the later of the date the Holders
        receive the notice referred to in clause (ii) and the date referred to in
        such
        notice. The provisions of Section
        6.6(g)
        hereof
        shall not be applicable during the period of any Allowable Grace Period.
        Upon
        expiration of the Grace Period, the Company shall again be bound by the first
        sentence of Section
        6.6(f)
        with
        respect to the information giving rise thereto unless such material non-public
        information is no longer applicable. In the event that the Company shall
        exercise its right to effect a Grace Period hereunder, the Registration Period
        during which the Registration Statement is to remain effective shall be extended
        by a period of time equal to the duration of any Grace Periods.

       

      
        
          
          

        

        
          -28-

          
            

          

        

        
          
          

        

      

       

      (q) At
        the
        end of the Registration Period the Holder shall discontinue sales of shares
        pursuant to the Registration Statement upon receipt of notice from the Company
        of its intention to remove from registration the shares covered by such
        Registration Statement which remain unsold, and such Holder shall notify
        the
        Company of the number of shares registered which remain unsold immediately
        upon
        receipt of such notice by the Company. 

       

      6.7 Obligations
        of the Holder.

       

      (a) At
        least
        seven (7) days prior to the first anticipated filing date of a Registration
        Statement, the Company shall notify a Holder in writing of the information
        the
        Company requires from such Holder if such Holder elects to have any of its
        Registrable Securities included in such Registration Statement. It shall
        be a
        condition precedent to the obligations of the Company to complete the
        registration pursuant to this Article
        6
        with
        respect to such Registrable Securities that such Holder shall furnish to
        the
        Company information regarding itself, the Registrable Securities held by
        it and
        the intended method of disposition of the Registrable Securities held by
        it as
        shall be reasonably required to effect the registration of such Registrable
        Securities and shall execute such documents in connection with such registration
        as the Company may reasonably request, in each case within seven (7) Business
        Days of being notified by the Company of its necessity.

       

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

       

      (c) A
        Holder
        agrees that, upon receipt of any notice from the Company of the happening
        of any
        event of the kind described in Section
        6.6(g)
        or the
        first sentence of Section
        6.6(f),
        such
        Holder will immediately discontinue disposition of Registrable Securities
        pursuant to any Registration Statement(s) covering such Registrable Securities
        until such Holder’s receipt of the copies of the supplemented or amended
        prospectus contemplated by Section
        6.6(g)
        or the
        first sentence of Section
        6.6(f)
        or
        receipt of notice that no supplement or amendment is required. Notwithstanding
        anything to the contrary, the Company shall cause its transfer agent to deliver
        unlegended shares of Common Stock to a transferee of a Holder in accordance
        with
        the terms of this Agreement in connection with any sale of Registrable
        Securities with respect to which a Holder has entered into a contract for
        sale
        prior to such Holder’s receipt of a notice from the Company of the happening of
        any event of the kind described in Section
        6.6(g)
        or the
        first sentence of Section
        6.6(f)
        and for
        which such Holder has not yet settled.

       

      (d) As
        promptly as practicable after becoming aware of such event, a Holder shall
        notify the Company in writing of the happening of any event as a result of
        which
        the information provided in writing by such Holder to the Company expressly
        for
        use in the prospectus included in a Registration Statement, as then in effect,
        includes an untrue statement of a material fact or omission to state a material
        fact required to be stated therein or necessary to make the statements therein,
        in light of the circumstances under which they were made, not misleading;
        provided,
        however,
        that no
        separate written notification shall be required for any event disclosed by
        such
        Holder in a timely filing with the SEC relating to the Company’s
        securities.

       

      
        
          
          

        

        
          -29-

          
            

          

        

        
          
          

        

      

       

      6.8 Expenses
        of Registration.
        All
        expenses incurred in connection with registrations, filings or qualifications
        pursuant to Sections
        6.1
        through
6.8
        of this
Article
        6,
        including, without limitation, all registration, listing and qualifications
        fees, printers and accounting fees, transfer agent fees and fees and
        disbursements of counsel for the Company, but excluding underwriting discounts
        and commissions, shall be paid by the Company. The Company shall also reimburse
        any Holder for the reasonable and documented fees and disbursements of its
        attorneys in connection with registration, filing or qualification pursuant
        to
Sections
        6.1
        through
6.6
        of this
Article
        6.
        The
        Company shall pay all of such Holder’s reasonable costs (including fees and
        disbursements of its attorneys) incurred in connection with the successful
        enforcement of the Holder’s rights under this Article
        6.

       

      6.9 Indemnification.
        In the
        event any Registrable Securities are included in a Registration Statement
        under
        this Article
        6:

       

      (a) To
        the
        extent permitted by law, the Company shall indemnify any Holder, the directors,
        officers, members, partners, employees, agents or other representatives of
        and
        each Person controlling such Holder within the meaning of Section 15 of the
        Securities Act, with respect to which any registration that has been effected
        pursuant to this Agreement, against all claims, losses, damages, liabilities,
        fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid in
        settlement or expenses, joint or several, (collectively, “Claims”)
        (or
        action in respect thereof), including any Claims incurred in settlement of
        any
        litigation, commenced or threatened (subject to Section
        6.9(c)
        below),
        arising out of or based on (i) any untrue statement (or alleged untrue
        statement) of a material fact contained in the Registration Statement,
        prospectus (final or preliminary), any amendment or supplement thereof, issuer
        free-writing prospectus, circular, or other document incident to any such
        registration, qualification or compliance or based on any omission (or alleged
        omission) to state therein a material fact required to be stated therein
        or
        necessary to make the statements therein not misleading, in light of the
        circumstances in which they were made, (ii) any violation by the Company
        of any
        rule or regulation promulgated by the Securities Act, the Exchange Act, or
        any
        other law, including, without limitation, any state securities law, or any
        rule
        or regulation thereunder relating to the offer or sale of the Registrable
        Securities pursuant to a Registration Statement applicable to the Company
        and
        relating to any action or inaction required of the Company in connection
        with
        any such registration, qualification or compliance, or (iii) any violation
        by
        the Company of the terms of this Article
        6,
        and
        will reimburse any Holder, the directors, officers, members, partners,
        employees, agents or other representatives of and each Person controlling
        such
        Holder, for reasonable legal and other out-of-pocket expenses reasonably
        incurred in connection with investigating or defending any such Claim as
        incurred; provided
        that the
        Company will not be liable in any such case to the extent that any untrue
        statement or omission or allegation thereof is made in reliance upon and
        in
        conformity with written information furnished to the Company by or on behalf
        of
        such Holder for use in preparation of such Registration Statement, prospectus,
        amendment or supplement; provided further
        that the
        Company will not be liable in any such case where the Claim results from
        the
        material failure of such Holder to comply with the covenants and agreements
        contained in this Article
        6
        respecting sales of Registrable Securities.

       

      
        
          
          

        

        
          -30-

          
            

          

        

        
          
          

        

      

       

      (b) The
        Purchaser will indemnify the Company, the directors, officers, employees,
        agents, legal counsel and other representatives and each Person who controls
        the
        Company within the meaning of Section 15 of the Securities Act, against all
        Claims (or actions in respect thereof), including any Claims incurred in
        settlement of any litigation, commenced or threatened (subject to Section
        6.9(c)
        below),
        arising out of or based on any untrue statement (or alleged untrue statement)
        of
        a material fact contained in the Registration Statement, prospectus (final
        or
        preliminary), any amendment or supplement thereof, issuer free-writing
        prospectus, circular or other documents, incident to any such registration,
        qualification or compliance, or based on any omission (or alleged omission)
        to
        state therein a material fact required to be stated therein or necessary
        to make
        the statements therein not misleading, in light of the circumstances in which
        they were made, and will reimburse the Company, the directors, officers,
        employees, agents, legal counsel and other representatives and each Person
        controlling the Company for reasonable legal and any other expenses reasonably
        incurred in connection with investigating or defending any such Claim as
        incurred, in each case to the extent, that such untrue statement or omission
        or
        allegation thereof is made in reliance upon and in conformity with written
        information furnished to the Company by or on behalf of a Holder for use
        in
        preparation of the Registration Statement, prospectus, amendment or supplement.
        Notwithstanding the foregoing, a Holder’s aggregate liability pursuant to
subsection
        (b)
        and
(d)
        of this
Section
        6.9
        shall
        not exceed the net proceeds received by such Holder from the sale of the
        Registrable Securities pursuant to the Registration Statement giving rise
        to
        such liability.

       

      (c) Each
        party entitled to indemnification under this Section
        6.9
        (the
“Indemnified
        Party”)
        shall
        give notice to the party required to provide indemnification (the “Indemnifying
        Party”)
        promptly after such Indemnified Party has actual knowledge of any claim as
        to
        which indemnity may be sought, and shall permit the Indemnifying Party (at
        its
        expense) to assume the defense of any such claim or any litigation resulting
        therefrom, provided that counsel for the Indemnifying Party, who shall conduct
        the defense of such claim or litigation, shall be approved by the Indemnified
        Party (whose approval shall not unreasonably be withheld), and the Indemnified
        Party may participate in such defense at such Indemnified Party’s expense, and
        provided further that the failure of any Indemnified Party to give notice
        as
        provided herein shall not relieve the Indemnifying Party of its obligations
        under this Agreement, unless such failure is materially prejudicial to the
        Indemnifying Party in defending such claim or litigation. Notwithstanding
        the
        foregoing, an Indemnified Party shall have the right to retain its own counsel,
        with the fees and expenses to be paid by the Indemnifying Party, if
        representation of such Indemnified Party by the counsel retained by the
        Indemnifying Party would be inappropriate due to actual or potential differing
        interests between such Indemnified Party and any other party represented
        by such
        counsel in such proceeding. An Indemnifying Party shall not be liable for
        any
        settlement of an action or claim effected without its written consent (which
        consent will not be unreasonably withheld). No Indemnifying Party, in its
        defense of any such claim or litigation, shall, except with the consent of
        each
        Indemnified Party, consent to entry of any judgment or enter into any settlement
        which does not include as an unconditional term thereof the giving by the
        claimant or plaintiff to such Indemnified Party of a release from all liability
        in respect to such claim or litigation. 

       

      (d) If
        the
        indemnification provided for in this Section
        6.9
        is held
        by a court of competent jurisdiction to be unavailable to an Indemnified
        Party
        with respect to any Claim referred to therein, then the Indemnifying Party,
        in
        lieu of indemnifying such Indemnified Party thereunder, shall contribute
        to the
        amount paid or payable by such Indemnified Party as a result of such Claim
        in
        such proportion as is appropriate to reflect the relative fault of the
        Indemnifying Party on the one hand and of the Indemnified Party on the other
        in
        connection with the statements or omissions which resulted in such Claim
        as well
        as any other relevant equitable considerations. The relative fault of the
        Indemnifying Party and of the Indemnified Party shall be determined by reference
        to, among other things, whether the untrue or alleged untrue statement of
        a
        material fact or the omission to state a material fact relates to information
        supplied by the Indemnifying Party or by the Indemnified Party and the parties’
relative intent, knowledge, access to information and opportunity to correct
        or
        prevent such statement or omission provided, that in no event shall any
        contribution by a Holder hereunder when combined with amounts paid pursuant
        to
subsection
        (b)
        of this
Section
        6.9
        exceed
        the net proceeds received by such Holder upon the sale of the Registrable
        Securities giving rise to such contribution obligation. 

       

      
        
          
          

        

        
          -31-

          
            

          

        

        
          
          

        

      

       

      6.10 Assignment
        and Transfer.
        The
        rights to cause the Company to register Registrable Securities granted to
        the
        Purchaser by the Company in this Article
        6
        may be
        assigned to a Holder, provided that such Holder is an Affiliate of the
        Purchaser, in connection with a transfer by such Holder of all or a portion
        of
        its Registrable Securities; provided,
        however,
        that
        such transfer must be made at least five (5) days prior to the Filing Deadline
        and that (a) such transfer may otherwise be effected in accordance with
        applicable securities laws, including establishing the transferee’s
        qualification as an “accredited investor” within the meaning of the Securities
        Act; (b) such Holder gives prior written notice to the Company at least five
        (5)
        days prior to the Filing Deadline; and (c) such transferee agrees in writing
        with the Company to comply with and be bound by all of the provisions of
        this
        Agreement; and (d) such transfer is otherwise in accordance with the applicable
        requirements of this Agreement. Except
        as
        specifically permitted by this Section
        6.10,
        the
        rights of a Holder with respect to Registrable Securities as set out herein
        shall not be transferable to any other Person, and any attempted transfer
        shall
        cause all rights of such Holder therein to be forfeited. Notwithstanding
        the
        foregoing provisions of this Section
        6.10,
        no such
        restriction shall apply to a transfer by a Holder that is: (i) a partnership
        transferring to its partners or former partners in accordance with partnership
        interests; (ii) a corporation transferring to a wholly-owned subsidiary or
        a
        parent corporation that owns all of the capital stock of the Holder; (iii)
        a
        limited liability company transferring to its members or former members in
        accordance with their interest in the limited liability company; (iv) an
        affiliated investment fund transferring to another affiliated investment
        fund;
        or (v) an individual transferring to the Holder’s family member or trust for the
        benefit of an individual Holder; provided
        that in
        each case the transfer is effected in accordance with applicable securities
        laws, including establishing the transferee’s qualification as an “accredited
        investor” within the meaning of the Securities Act, and the transferee agrees in
        writing to be subject to the terms of this Agreement to the same extent as
        if
        the transferee were an original Holder hereunder.

       

      6.11 Amendment
        and Waiver of Registration Rights.
        The
        rights of any Holder under the provisions of this Article
        6
        may be
        waived (either generally or in a particular instance, either retroactively
        or
        prospectively and either for a specified period of time or indefinitely)
        or
        amended by an instrument in writing signed by such Holder. Any amendment
        or
        waiver effected in accordance with this Section
        6.11
        shall be
        binding upon any Holder and the Company. By acceptance of the benefits under
        this Article
        6,
        any
        Holder of the Registrable Securities hereby agree to be bound by the provisions
        hereof.

       

      
        
          
          

        

        
          -32-

          
            

          

        

        
          
          

        

      

       

      6.12 Lock-Up
        Period.
        For a
        period of six (6) months from the Closing Date, the Purchaser agrees not
        to
        offer, sell, contract to sell, pledge, grant any option to purchase, make
        any
        short sale or otherwise dispose of any Shares, or any securities convertible
        into, exchangeable for or that represent the right to receive the Shares,
        whether now owned or hereinafter acquired, owned directly by the Purchaser
        or
        with respect to which the Purchaser has beneficial ownership within the rules
        and regulations of the SEC.

       

      ARTICLE
        7

       

      MISCELLANEOUS

       

      7.1 Termination.
        This
        Agreement may be terminated at any time with respect to the applicable parties
        prior to the Closing:

       

      (a) By
        mutual
        written agreement of the Company and the Purchaser;

       

      (b) By
        either
        the Company or the Purchaser if the Alliance Agreement has been
        terminated;

       

      (c) By
        either
        the Company or the Purchaser, by written notice to the other parties (provided
        the terminating party is not then in material breach of any representation,
        warranty, covenant or other agreement contained in this Agreement or the
        Related
        Agreements) if the Closing shall not have been consummated on or before April
        7,
        2007;

       

      (d) By
        either
        the Company or the Purchaser by giving written notice to the other party
        or
        parties if any governmental entity shall have issued an injunction or other
        ruling prohibiting the consummation of any of the transactions contemplated
        by
        this Agreement and the Related Agreements and such injunction or other ruling
        shall not be subject to appeal or shall have become final and
        unappealable;

       

      (e) By
        the
        Purchaser, if there shall have occurred an event or events constituting a
        Material Adverse Effect; 

       

      (f) By
        the
        Purchaser, if the Company shall have materially breached the terms of this
        Agreement and such breach is not cured within five (5) Business Days after
        receiving notice thereof; or

       

      (g) By
        the
        Company if the Purchaser shall have materially breached the terms of this
        Agreement and such breach is not cured within five (5) Business Days after
        receiving notice thereof.

       

      7.2 Effect
        of Termination.
        In the
        event of any termination of this Agreement pursuant to Section
        7.1,
        all
        rights and obligations of the parties hereunder shall terminate without any
        liability on the part of any party or its Affiliates in respect thereof;
        provided,
        however,
        that
        such termination shall not relieve the Company or the Purchaser of any liability
        for any willful breach of this Agreement.

       

      
        
          
          

        

        
          -33-

          
            

          

        

        
          
          

        

      

       

      7.3 Governing
        Law; Jurisdiction.
        This
        Agreement will be governed by and interpreted in accordance with the laws
        of the
        State of New York. 

       

      7.4 Counterparts;
        Signatures by Facsimile.
        This
        Agreement may be executed in two or more counterparts, all of which are
        considered one and the same agreement and will become effective when
        counterparts have been signed by each party and delivered to the other parties.
        This Agreement, once executed by a party, may be delivered to the other parties
        hereto by facsimile transmission of a copy of this Agreement bearing the
        signature of the party so delivering this Agreement.

       

      7.5 Headings.
        The
        headings of this Agreement are for convenience of reference only, are not
        part
        of this Agreement and do not affect its interpretation.

       

      7.6 Severability.
        If any
        provision of this Agreement is invalid or unenforceable under any applicable
        statute or rule of law, then such provision will be deemed modified in order
        to
        conform with such statute or rule of law. Any provision hereof that may prove
        invalid or unenforceable under any law will not affect the validity or
        enforceability of any other provision hereof. 

       

      7.7 Entire
        Agreement; Amendments; Waiver.
        This
        Agreement and the Related Agreements (including all schedules and exhibits
        hereto and thereto) constitute the entire agreement among the parties hereto
        with respect to the subject matter hereof and thereof. There are no
        restrictions, promises, warranties or undertakings, other than those set
        forth
        or referred to herein or therein. This Agreement and the Related Agreements
        supersede all prior agreements and understandings among the parties hereto
        with
        respect to the subject matter hereof and thereof. Except as otherwise provided
        herein, no provision of this Agreement may be amended or waived other than
        by an
        instrument in writing signed by the Company and the Purchaser, or in the
        case of
        a waiver, by the party against whom enforcement of such waiver is sought.
        Any
        amendment effected in accordance with this Section
        7.7
        shall be
        binding upon the holder of any Shares purchased under this Agreement at the
        time
        outstanding, each future holder of all such securities and the
        Company.

       

      7.8 Notices.
        All
        notices required or permitted hereunder shall be in writing and shall be
        deemed
        effectively given: (a) upon personal delivery to the party to be notified,
        (b)
        when sent by confirmed email, telex or facsimile if sent during normal business
        hours of the recipient, if not, then on the next business day, (c) five days
        after having been sent by registered or certified mail, return receipt
        requested, postage prepaid, or (d) one business day after deposit with a
        nationally recognized overnight courier, specifying next day delivery, with
        written verification of receipt. The addresses for such communications
        are:

       

      
        
          
          

        

        
          -34-

          
            

          

        

        
          
          

        

      

       

      
        	 	
                If
                  to the Company:

              	
                FuelCell
                  Energy, Inc.

              

      

      3
        Great
        Pasture Road

      Danbury,
        CT 06813

      Facsimile:
        (203) 825-6069

      Attention:
        Ross Levine

       

      with
        a
        copy to:

       

      Robinson
        and Cole LLP

      Financial
        Center

      P.O.
        Box
        10305

      Stamford,
        CT 06904-2305

      Facsimile:
        (203) 462-7599

      Attention:
        Richard Krantz

       

      
        	 	
                If
                  the Purchaser: 

              	
                POSCO
                  Power

              

      

      Dacom
        Building, 10th
        Floor

      706-1
        Yeoksam-dong, Kangnam-gu

      Seoul
        135-987, Korea

      Facsimile:
        011-82-2-3457-1960

      Attention:
        Taehyoung (TH) Kim

       

      with
        a
        copy to:

       

      
        	 	 	
                POSCO

              

      

      POSCO
        Center

      892
        Daechi 4-Dong, Kangnam-gu

      Seoul
        135-777, Korea

      Facsimile:
        011-82-2-3457-1972

      Attention:
        Bong-han “Stephen” Kim, Esq.

       

      Each
        party will provide ten (10) days’ advance written notice to the other parties of
        any change in its address. 

       

      7.9 Successors
        and Assigns.
        This
        Agreement is binding upon and inures to the benefit of the parties and their
        successors and permitted assigns. The Company will not assign this Agreement
        or
        any rights or obligations hereunder without the prior written consent of
        the
        Purchaser, and the Purchaser may assign this Agreement or any rights or
        obligations hereunder without the prior written consent of the Company, except
        as permitted in accordance with Section
        6.10
        hereof.

       

      7.10 Third
        Party Beneficiaries.
        This
        Agreement is intended for the benefit of the parties hereto, their respective
        permitted successors and assigns, and is not for the benefit of, nor may
        any
        provision hereof be enforced by, any other person.

       

      
        
          
          

        

        
          -35-

          
            

          

        

        
          
          

        

      

       

      7.11 No
        Strict Construction.
        The
        language used in this Agreement is deemed to be the language chosen by the
        parties to express their mutual intent, and no rules of strict construction
        will
        be applied against any party. 

       

      7.12 Equitable
        Relief.
        The
        Company recognizes that, if it fails to perform or discharge any of its
        obligations under this Agreement, any remedy at law may prove to be inadequate
        relief to the Purchaser. The Company therefore agrees that the Purchaser
        is
        entitled to seek temporary and permanent injunctive relief in any such case.
        The
        Purchaser also recognizes that, if it fails to perform or discharge any of
        its
        obligations under this Agreement, any remedy at law may prove to be inadequate
        relief to the Company. The Purchaser therefore agrees that the Company is
        entitled to seek temporary and permanent injunctive relief in any such
        case

       

      7.13 Survival
        of Representations and Warranties.
        Notwithstanding any investigation made by any party to this Agreement, all
        representations and warranties made by the Company and the Purchaser herein
        shall survive for a period of one (1) year from the Closing Date. All covenants
        contained herein shall survive the execution of this Agreement and the Closing
        of the transactions contemplated hereby (except to the extent expressly provided
        in this Agreement).

       

      7.14 Limitation
        on Enforcement of Remedies.
        The
        Company hereby agrees that it will not assert against the shareholders, limited
        partners or any members of the Purchaser any claim it may have under this
        Agreement by reason of any failure or alleged failure by such Purchaser to
        meet
        its obligations hereunder.

       

      7.15 Aggregation
        of Stock.
        All
        shares of Registrable Securities held or acquired by affiliated Person or
        Persons under common management or control shall be aggregated together for
        the
        purpose of determining the availability of any rights under this
        Agreement.

       

      7.16 Reproduction
        of Documents.
        This
        Agreement and all documents relating thereto, including, without limitation,
        (i)
        consents, waivers and modifications which may hereafter be executed, (ii)
        documents received by the Purchaser on the Closing Date (except for certificates
        evidencing the Shares themselves), and (iii) financial statements, certificates
        and other information previously or hereafter furnished to the Purchaser,
        may be
        reproduced by the Purchaser by any photographic, photostatic, microfilm,
        micro-card, miniature photographic or other similar process and the Purchaser
        may destroy any original document so reproduced. All parties hereto agree
        and
        stipulate that any such reproduction shall be admissible in evidence as the
        original itself in any judicial or administrative proceeding (whether or
        not the
        original is in existence and whether or not such reproduction was made by
        the
        Purchaser in the regular course of business) and that any enlargement, facsimile
        or further reproduction of such reproduction shall likewise be admissible
        in
        evidence.

       

      7.17 Lost,
        etc. Certificates Evidencing Shares; Exchange.
        Upon
        receipt by the Company of evidence reasonably satisfactory to it of the loss,
        theft, destruction or mutilation of any certificate evidencing any Shares
        owned
        by the Purchaser and (in the case of loss, theft or destruction) of an unsecured
        indemnity satisfactory to it, and upon reimbursement to the Company of all
        reasonable expenses incidental thereto, and upon surrender and cancellation
        of
        such certificate, if mutilated, the Company will make and deliver in lieu
        of
        such certificate a new certificate of like tenor and for the number of
        securities evidenced by such certificate which remain outstanding. The
        Purchaser’s agreement of indemnity shall constitute indemnity satisfactory to
        the Company for purposes of this Section
        7.17.
        Upon
        surrender of any certificate representing any Shares, for exchange at the
        office
        of the Company, the Company at its expense will cause to be issued in exchange
        therefor new certificates in such denomination or denominations as may be
        requested for the same aggregate number of Shares represented by the
        certificate so surrendered and registered as such holder may request. The
        Company will also pay the cost of all deliveries of certificates for such
        Shares
        to the office of the Purchaser (including the cost of insurance against loss
        or
        theft in an amount satisfactory to the holders) upon any exchange provided
        for
        in this Section
        7.18.

       

      
        
          
          

        

        
          -36-

          
            

          

        

        
          
          

        

      

       

      7.18 Draftsmanship.
        Each of
        the parties hereto has been represented by its own counsel and acknowledges
        that
        it has participated in the drafting of this Agreement,
        and any
        applicable rule of construction to the effect that ambiguities are to be
        resolved against the drafting party shall not be applied in connection with
        the
        construction or interpretation of this Agreement. Whenever required by the
        context hereof, the singular number shall include the plural, and vice versa;
        the masculine gender shall include the feminine and neuter genders; and the
        neuter gender shall include the masculine and feminine genders.

       

      [Signature
        Page Follows]

      
        
          
          

        

        
          -37-

          
            

          

        

         

      

      IN
        WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed
        as of the date first above written. 

       

      
        	 	 	 
	 	FUELCELL
                ENERGY, INC.
	 
 	 
 	 
 
	 	By:  	/s/ R.
                Daniel
                Brdar 
	 	
                

                Name:
                  R. Daniel Brdar

                Title:
                  President, CEO and Chairman

              

      

       

      
        	 	 	 
	 	POSCO
                POWER
	 
 	 
 	 
 
	 	By:  	/s/ Seung-Woo
                Lee
	 	
                

                
                  Name:
                    Seung-Woo Lee

                  Title:
                    President and CEO

                

              

      

       

      SIGNATURE
        PAGE TO SECURITIES PURCHASE AGREEMENT

       

      
        
          
          

        

        
          
          

          
            

          

        

         

      

      EXHIBIT
        A

       

      DEFINITIONS

       

      Capitalized
        terms used in this Agreement and not otherwise defined in this Agreement
        shall
        have the following meanings:

       

      “Affiliate”
means,
        with respect to any Person, any other Person controlling, controlled by or
        under
        direct or indirect common control with such Person (for the purposes of this
        definition “control,” when used with respect to any specified Person, shall mean
        the power to direct the management and policies of such person, directly
        or
        indirectly, whether through ownership of voting securities, by contract or
        otherwise; and the terms “controlling” and “controlled” shall have meanings
        correlative to the foregoing).

       

      “Alliance
        Agreement”
means
        that certain Alliance Agreement dated as of the date hereof between the Company
        and the Purchaser.

       

      “Allowable
        Grace Period”
has
        the
        meaning set out in Section
        6.6(p).
        

       

      “Board”
has
        the
        meaning set forth in Section
        2.3(c).

       

      “Business
        Day”
means
        a
        day Monday through Friday on which banks are generally open for business
        in New
        York City.

       

      “Bylaws”
has
        the
        meaning set forth in Section
        2.3(d).
        

       

      “Certificate
        of Incorporation”
has
        the
        meaning set forth in Section
        2.3(d).

       

      “Claims”
has
        the
        meaning set forth in Section
        6.9(a).
        

       

      “Closing”
has
        the
        meaning set forth in Section
        1.4.
        

       

      “Closing
        Date”
has
        the
        meaning set forth in Section
        1.4.
        

       

      “Common
        Stock”
means
        the common stock, par value $0.0001 per share, of the Company.

       

      “Company”
has
        the
        meaning set forth in the introductory paragraph.

       

      “Damages
        Accrual Period”
has
        the
        meaning set forth in Section
        6.5.
        

       

      “Delay
        Payment Rate”
means
        during the Damages Accrual Period, an amount per week (or portion thereof)
        per
        share of Common Stock equal to 1% of the per share Purchase Price of such
        Share.

       

      “Demand
        Registration”
has
        the
        meaning set forth in Section
        6.2.
        

       

      “DGCL”
means
        the Delaware General Corporation Law.

       

      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

        

      

       

      “Disclosure
        Schedule”
means
        the Disclosure Schedules of the Company delivered concurrently herewith and
        incorporated herein by reference. 

       

      “Effectiveness
        Deadline”
has
        the
        meaning set forth in Section
        6.1.
        

       

      “Evaluation
        Date”
has
        the
        meaning set forth in Section
        2.7.

       

      “Exchange
        Act”
means
        the Securities Exchange Act of 1934, as amended.

       

      “Filing
        Deadline”
has
        the
        meaning set forth in Section
        6.1.
        

       

      “Financial
        Statements”
means
        the financial statements of the Company included in the SEC
        Documents.

       

      “Grace
        Period”
has
        the
        meaning set forth in Section
        6.6(p).
        

       

      “Holder”
means
        the Purchaser and any Person to whom the Purchaser, in accordance with
Section
        6.10
        hereof,
        transfers its rights under Article
        6
        of this
        Agreement.

       

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

       

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

       

      “Inspectors”
has
        the
        meaning set forth in Section
        6.6(i).
        

       

      “Intellectual
        Property Rights”
has
        the
        meaning set forth in Section
        2.10(a).

       

      “Investment
        Company Act”
has
        the
        meaning set forth in Section
        2.24.
        

       

      “Liens”
means
        security interests, pledges, liens, charges, claims, options, restrictions
        on
        transfer, mortgages, rights of first refusal, preemptive or similar rights,
        proxies and voting or other agreements, or other encumbrances of any nature
        whatsoever.

       

      “Market
        Price”
has
        the
        meaning set forth in Section
        1.1.

       

      “Material
        Adverse Effect”
means
        an event, change or occurrence that individually, or together with any other
        event, change or occurrence, has had or reasonably could be expected to have
        a
        material adverse effect on (a) the business, operations, assets, prospects
        or
        financial condition of the Company and its Subsidiaries, taken together as
        a
        whole, or (b) the ability of the Company to perform its obligations pursuant
        to
        the transactions contemplated by this Agreement and the Related
        Agreements.

       

      “Material
        Contracts”
has
        the
        meaning set forth in Section
        2.14(a).
        

       

      “Material
        Permits”
has
        the
        meaning set forth in Section
        2.5(c).
        

       

      “NASDAQ”
has
        the
        meaning set forth in Section
        1.1.

       

      
        
          
          

        

        
          A-2

          
            

          

        

        
          
          

        

      

       

      “Offering”
means
        the offer, sale, issuance and purchase of the Shares contemplated by this
        Agreement. 

       

      “Non-US
        Person”
has
        the
        meaning set forth in Section
        3.2.

       

      “Per
        Share Purchase Price”
has
        the
        meaning set forth in Section
        1.1.
        

       

      “Person”
means
        any person, individual, corporation, limited liability company, partnership,
        trust or other nongovernmental entity or any governmental agency, court,
        authority or other body (whether foreign, federal, state, local or
        otherwise).

       

      “Preferred
        Stock”
has
        the
        meaning set forth in Section
        2.3(a).

       

      “Purchaser”
has
        the
        meaning set forth in the introductory paragraph. 

       

      “Purchase
        Price”
has
        the
        meaning set forth in Section
        1.1.
        

       

      “Records”
has
        the
        meaning set forth in Section
        6.6(i).
        

       

      The
        terms
“register,”
        “registered”
and
        “registration”
refer
        to the registration effected by preparing and filing a registration statement
        in
        compliance with the Securities Act, and the declaration or ordering of the
        effectiveness of such registration statement.

       

      “Registrable
        Securities”
means
        the Shares; provided,
        however,
        that
        securities shall only be treated as Registrable Securities if and only for
        so
        long as they (A) have not been disposed of pursuant to a Registration Statement
        declared effective by the SEC, (B) have not been sold in a transaction exempt
        from the registration and prospectus delivery requirements of the Securities
        Act
        so that all transfer restrictions and restrictive legends with respect thereto
        are removed upon the consummation of such sale or (C) are held by a Holder
        or a
        permitted transferee pursuant to Section
        6.10.

       

      “Registration
        Delay”
means
        the occurrence of any of (i) a Registration Statement covering all of the
        Registrable Securities is not filed with the SEC on or before the Filing
        Deadline or is not declared effective on or before the Effectiveness Deadline,
        (ii) a Registration Statement in connection with a Demand Registration covering
        all of the Registrable Securities required to be covered thereby is not filed
        with the SEC on or before the deadline described in the last sentence of
        Section
        6.2,
        (iii)
        on any day during the Registration Period (other than during an Allowable
        Grace
        Period), all of the Registrable Securities required to be included in such
        Registration Statement cannot be sold pursuant to such Registration Statement
        as
        a matter of law or because the Company has failed to perform the applicable
        time
        period required for such performance (including, without limitation, because
        of
        a failure to keep such Registration Statement effective, to disclose such
        information as is necessary for sales to be made pursuant to such Registration
        Statement, or to register a sufficient number of Shares, or (iv) a Grace
        Period
        exceeds the length of an Allowable Grace Period. 

       

      “Registration
        Delay Payments”
has
        the
        meaning set forth in Section
        6.5.

       

      
        
          
          

        

        
          A-3

          
            

          

        

        
          
          

        

      

       

      “Registration
        Period”
has
        the
        meaning set forth in Section
        6.6(a).
        

       

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

       

      “Related
        Agreements”
has
        the
        meaning set forth in Section
        2.2.
        

       

      “Required
        Approvals”
has
        the
        meaning set forth in Section
        2.5(b).
        

       

      “Rule
        144”
means
        Rule 144 promulgated under the Securities Act, or any successor
        rule.

       

      “Sarbanes-Oxley
        Act of 2002”
means
        the Sarbanes-Oxley Act of 2002, as amended, and the related rules and
        regulations promulgated under such act or the Exchange Act.

       

      “SEC”
means
        the United States Securities and Exchange Commission. 

       

      “SEC
        Documents”
has
        the
        meaning set forth in Section
        2.6.
        

       

      “Securities
        Act”
means
        the Securities Act of 1933, as amended, and the rules and regulations
        thereunder, or any similar successor statute. 

       

      “Share”
and
        “Shares”
has
        the
        meaning set forth in Section
        1.1.

       

      “Subsidiary”
and
        “Subsidiaries”
of
        any
        person shall mean any corporation, partnership, limited liability company,
        joint
        venture or other legal entity of which such Person (either above or through
        or
        together with any other subsidiary) owns, directly or indirectly, more than
        50%
        of the stock or other equity interests the holders of which are generally
        entitled to vote for the election of the board of directors or other governing
        body of such corporation or other legal entity.

       

      “Takeover
        Provision”
has
        the
        meaning set forth in Section
        2.27.

       

      “Technology
        Transfer Agreement”
means
        the Technology Transfer, License and Distribution Agreement dated as of the
        date
        hereof between the Company and the Purchaser.

      
        
          
          

        

        
          A-4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}]]