Document:

Exhibit 10.4

 

REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”)
is dated as of June 16, 2008 between Answers Corporation, a Delaware
corporation (the “Company”), and Redpoint Omega, L.P. and Redpoint Omega
Associates, LLC (each a “Purchaser” and collectively, the “Purchasers”).

 

WHEREAS, subject to the terms and conditions
set forth in this Agreement and pursuant to the Securities Purchase Agreement,
dated as of the date hereof, among the Company and the Purchaser (the “Purchase
Agreement”), the Company has agreed to provide certain registration rights
under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the “Securities
Act”), and applicable state securities laws.

 

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchaser agree
as follows:

 

1.                                      Definitions

 

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

 

“Advice” shall have the meaning set forth in Section 8(d).

 

“Certificate of Designation” shall have the meaning set forth in
the Purchase Agreement.

 

“Commission” means the Securities and Exchange Commission.

 

“DGCL” means the General Corporation Law of the State of
Delaware.

 

“Effectiveness Date” means, with respect to the initial
Registration Statement required to be filed hereunder, the 150th
calendar day following the Closing Date (as defined in the Purchase Agreement)
and, with respect to any additional Registration Statements which may be
required pursuant to Section 2(b), the 150th  calendar day following the date on which the
Company first knows, or reasonably should have known, that such additional
Registration Statement is required hereunder; provided, however,
in the event the Company is notified by the Commission that any Registration
Statement(s) required hereunder will not be reviewed or is no longer
subject to further review and comments, the Effectiveness Date as to such
Registration Statement shall be the fifth Trading Day following the date on
which the Company is so notified if such date precedes the dates required
above.

 

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

 

“Event” shall have the meaning set forth in Section 2(c).

 

“Event Date” shall have the meaning set forth in Section 2(c).

 

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

 

 

“Filing Date” means, with respect to the initial Registration
Statement required hereunder, the 60th calendar day following the
date hereof, and, with respect to any additional Registration Statements which
may be required pursuant to Section 2(b), the 30th day
following the date on which the Company first knows, or reasonably should have
known that such additional Registration Statement is required hereunder.

 

“Holder” or “Holders” means the holder or holders, as the
case may be, from time to time of Registrable Securities.

 

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

 

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

 

“Legal Counsel” shall have the meaning set forth in Section 2(d).

 

“Losses” shall have the meaning set forth in Section 5(a).

 

“Plan of Distribution” shall have the meaning set forth in Section 2(a).

 

“Preferred Director” shall have the meaning set forth in the
Certificate of Designation.

 

“Preferred Board Observer” shall have the meaning set forth in
the Certificate of Designation.

 

“Preferred Stock” shall have the meaning set forth in the
Purchase Agreement.

 

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

 

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

 

“Registrable Securities” means (i) all of the shares of
Common Stock issuable upon conversion of the Preferred Stock, (ii) all
Warrant Shares, (iv) any additional shares issuable in connection with any
anti-dilution provisions in the Preferred Stock or the Warrants (in each case,
without giving effect to any limitations on conversion set forth in the
Preferred Stock or limitations on exercise set forth in the Warrant), (v) all
of the shares of Common Stock issuable upon conversion of the Series B
Preferred Stock and exercise of the Common Stock Purchase Warrants issued upon
exercise of the warrant issued to the Holder, (vi) any shares of Common
Stock issued in payment in kind of accrued dividends on the Series A
Preferred Stock or Series B Preferred Stock and (vii) any securities
issued or issuable upon any stock split, dividend or other 

 

 

distribution, 
recapitalization or similar event with respect to any of the foregoing
referenced in clauses (i) – (vi).

 

“Registration Statement” means the registration statements required
to be filed hereunder and any additional registration statements contemplated
by Section 3(c), including (in each case) the Prospectus, amendments and
supplements to such registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material incorporated
by reference or deemed to be incorporated by reference in such registration
statement.

 

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

 

“Rule 424” means Rule 424 promulgated by the
Commission pursuant to the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same purpose and effect as such Rule.

 

“Securities” shall have the meaning set forth in the Purchase
Agreement.

 

“Selling Shareholder Questionnaire” shall have the meaning set
forth in Section 3(a).

 

“Series B Preferred Stock” shall have the meaning set forth
in the Warrant Agreement.

 

“Series B Director” shall have the meaning set forth in Section 7(a)(i).

 

“Trading Day” shall have the meaning set forth in the Purchase
Agreement.

 

“Transaction Documents” shall have the meaning set forth in the
Purchase Agreement.

 

“Unit Warrant” shall have the meaning set forth in the Warrant
Agreement.

 

“Warrant Agreement” shall mean the Warrant Agreement, dated the
date hereof, between the Company and the Purchasers.

 

“Warrant Shares” shall have the meaning set forth in the
Purchase Agreement.

 

“Warrants” shall have the meaning set forth in the Purchase
Agreement.

 

2.                                      Registration
Statement

 

(a)                                  On
or prior to each Filing Date, the Company shall prepare and file with the
Commission a Registration Statement covering the resale of all Registrable
Securities on such Filing Date for an offering to be made on a continuous basis
pursuant to Rule 415.  The
Registration Statement shall be on Form S-3 (except if the Company is not
then eligible to register for resale the Registrable Securities on Form S-3,
in which case such registration shall be on another appropriate form in
accordance herewith) and shall contain (unless otherwise directed by the
Holders) substantially the “Plan of Distribution” attached hereto as Annex
A.  Subject to the terms of this
Agreement, the Company shall use its reasonable best commercial efforts to
cause a Registration 

 

 

Statement to be declared
effective under the Securities Act as promptly as possible after the filing
thereof, but in any event prior to the applicable Effectiveness Date, and shall
use its reasonable best commercial efforts to keep such Registration Statement
continuously effective under the Securities Act until the earlier of (i) beginning
1 year after the date hereof, all of the Registrable Securities covered by such
Registration Statement have been sold and (ii) 100% of the Registrable
Securities may be sold without volume restrictions pursuant to Rule 144(b)(1) as
determined by the counsel to the Company pursuant to a written opinion letter
to such effect, addressed and acceptable to the Company’s transfer agent and
the affected Holders (the “Effectiveness Period”).  The Company shall telephonically request
effectiveness of a Registration Statement as of 4:00 pm Eastern Time on a
Trading Day.   The Company shall
immediately notify the Holders of the effectiveness of a Registration Statement
on the same Trading Day that the Company telephonically confirms effectiveness
with the Commission, which shall be the date requested for effectiveness of a
Registration Statement.  The Company
shall, by 9:30 am Eastern Time on the Trading Day after the Effectiveness Date
(as defined in the Purchase Agreement), file a Form 424(b)(5) with
the Commission.  Failure to so notify the
Holder within 1 Trading Day of such notification shall be deemed an Event under
Section 2(b).

 

(b)                                 If
for any reason the Commission does not permit all of the Registrable Securities
to be included in the Registration Statement(s) filed pursuant to Section 2(a),
or for any other reason any outstanding Registrable Securities are not then
covered by an effective Registration Statement(s), then the Company shall
prepare and file by the Filing Date for such Registration Statement, an
additional Registration Statement covering the resale of all Registrable
Securities not already covered by an existing and effective Registration
Statement for an offering to be made on a continuous basis pursuant to Rule 415,
on Form S-3 (or on such other form appropriate for such purpose).  Each such Registration Statement shall
contain (except if otherwise required pursuant to written comments received
from the Commission upon a review of such Registration Statement) the Plan of
Distribution.  The Company shall cause
each such Registration Statement to be declared effective under the Securities
Act as soon as possible, but in any event, by its Effectiveness Date, and shall
use its reasonable best commercial efforts to keep such Registration Statement
continuously effective under the Securities Act during the entire Effectiveness
Period.

 

(c)                                  If:
(i) a Registration Statement is not filed on or prior to its Filing Date
(if the Company files a Registration Statement without affording the Holders
the opportunity to review and comment on the same as required by Section 3(a),
the Company shall not be deemed to have satisfied this clause (i)), or (ii) the
Company fails to file with the Commission a request for acceleration in
accordance with Rule 461 promulgated under the Securities Act, within five
Trading Days of the date that the Company is notified (orally or in writing,
whichever is earlier) by the Commission that a Registration Statement will not
be “reviewed,” or not subject to further review, or (iii) a Registration
Statement filed or required to be filed hereunder is not declared effective by
the Commission by its Effectiveness Date, (iv) after the Effectiveness
Date, a Registration Statement ceases to remain continuously effective as to
all Registrable Securities for which it is required to be effective due to the
good faith determination of 

 

 

the board of directors of the
Company that the existence of a pending corporate development with respect to
the Company that the Company reasonably believes is material makes it not in
the best interest of the Company to allow continued availability of a
Registration Statement or Prospectus, or the Holders are not permitted to utilize
the Prospectus therein to resell such Registrable Securities for 15 consecutive
calendar days but no more than an aggregate of 45 calendar days during any
12-month period (which need not be consecutive Trading Days), or (v) after
the Effectiveness Date, a Registration Statement ceases for any reason to
remain continuously effective as to all Registrable Securities for which it is
required to be effective, or the Holders are not permitted to utilize the
Prospectus therein to resell such Registrable Securities for 15 consecutive
calendar days but no more than an aggregate of 45 calendar days during any
12-month period (which need not be consecutive Trading Days) (any such failure
or breach being referred to as an “Event”, and for purposes of clause (i) the
date on which such Event occurs, or for purposes of clause (ii) the date
on which such five Trading Day period is exceeded, or for purposes of clause (iii) the
date on which such Event occurs, except that if the Commission will not permit
acceleration or requests withdrawal as a result of the issuance of the
Securities under the Purchase Agreement or the failure of any Holder to comply
with the Plan of Distribution, then such date shall be 30 calendar days after
the date such Event occurs, or for purposes of clause (iv) the date on
which such 15 or 45 calendar day period, as applicable, is exceeded, or for
purposes of clause (v) the date on which such 15 or 45 calendar day period
is exceeded being referred to as “Event Date”), then in addition to any
other rights the Holders may have hereunder or under applicable law, on each
monthly anniversary of each such Event Date (if the applicable Event shall not
have been cured by such date) until the applicable Event is cured, the Company
shall promptly pay to each Holder an amount in cash, as partial liquidated
damages and not as a penalty, equal to 1.0% of the aggregate Purchase Price
paid by such Holder pursuant to the Purchase Agreement or the Warrant
Agreement, as the case may be, for any Registrable Securities then held by such
Holder (up to a maximum of 8% of such aggregate purchase or exercise prices),
provided that partial liquidated damages shall not be paid with respect to
those Registrable Securities which cannot be registered under Rule 415
solely as a result of action by the Commission. 
The partial liquidated damages pursuant to the terms hereof shall apply
on a daily pro-rata basis for any portion of a month prior to the cure of an
Event.  Notwithstanding the foregoing,
nothing shall preclude any Holder from pursuing or obtaining any available
remedies at law, specific performance or other equitable refief with respect to
this Section 2(c) in accordance with applicable law.

 

(d)                                 Subject
to Section 4 below, the Holder shall have the right to select one legal
counsel to review and oversee any registration pursuant to this Section 2
and Section 8(e) (“Legal
Counsel”), which shall be Gunderson Dettmer Stough Villeneuve
Franklin & Hachigian, LLP or such other counsel as thereafter
designated by the Holder.  The Company
and Legal Counsel shall reasonably cooperate with each other in performing the
Company’s obligations under this Agreement.

 

3.                                      Registration
Procedures.

 

In connection with the Company’s registration obligations hereunder,
the Company shall:

 

 

(a)                                  Not
less than five Trading Days prior to the filing of each Registration Statement
or any related Prospectus or any amendment or supplement thereto (including any
document that would be incorporated or deemed to be incorporated therein by
reference), the Company shall, (i) furnish to each Holder and Legal
Counsel copies of all such documents proposed to be filed, which documents
(other than those incorporated)  will be
subject to the review of such Holders and Legal Counsel, and (ii) cause
its officers and directors, counsel and independent certified public
accountants to respond to such inquiries as shall be necessary, in the
reasonable opinion of Legal Counsel to conduct a reasonable investigation
within the meaning of the Securities Act. The Company shall not file a
Registration Statement or any such Prospectus or any amendments or supplements
thereto to which the Holders of a majority of the Registrable Securities shall
reasonably object in good faith, provided that, the Company is notified of such
objection in writing no later than 5 Trading Days after the Holders have been
so furnished copies of such documents. Each Holder agrees to furnish to the
Company a completed Questionnaire in the form attached to this Agreement as
Annex B (a “Selling Shareholder Questionnaire”) not less than two
Trading Days prior to the Filing Date or by the end of the fourth Trading Day
following the date on which such Holder receives draft materials in accordance
with this Section.

 

(b)                                 (i) Prepare
and file with the Commission such amendments, including post-effective
amendments, to a Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep a Registration Statement continuously
effective as to the applicable Registrable Securities for the Effectiveness
Period and prepare and file with the Commission such additional Registration
Statements in order to register for resale under the Securities Act all of the
Registrable Securities; (ii) cause the related Prospectus to be amended or
supplemented by any required Prospectus supplement (subject to the terms of
this Agreement), and as so supplemented or amended to be filed pursuant to Rule 424;
(iii) respond as promptly as reasonably possible,  to any comments received from the Commission
with respect to a Registration Statement or any amendment thereto and as
promptly as reasonably possible provide the Holders true and complete copies of
all correspondence from and to the Commission relating to a Registration
Statement; (iv) file the final prospectus pursuant to Rule 424 of the
Securities Act no later than 9:00 a.m. Eastern Time on the business day
following the date the Registration Statement is declared effective by the
Commission; and (v) comply in all material respects with the provisions of
the Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by a Registration Statement during the
Effectiveness Period in accordance (subject to the terms of this Agreement)
with the intended methods of disposition by the Holders thereof set forth in
such Registration Statement as so amended or in such Prospectus as so
supplemented.

 

(c)                                  Notify
the Holders of Registrable Securities  to
be sold (which notice shall, pursuant to clauses (ii) through (vi) hereof,
be accompanied by an instruction to suspend the use of the Prospectus until the
requisite changes have been made) as promptly as reasonably possible (and, in
the case of (i)(A) below, not less than five Trading Days prior to such
filing and in the case of clause (iii) below, on the same day of receipt
by the Company of such notice from the Commission or federal or state
governmental authority) and (if requested by any such Person) confirm such
notice in 

 

 

writing no later than one
Trading Day following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is proposed
to be filed, ; (B) when the Commission notifies the Company whether there
will be a “review” of such Registration Statement and whenever the Commission
comments in writing on such Registration Statement (the Company shall provide
true and complete copies thereof and all written responses thereto to each of
the Holders, except to the extent the Company requests that such responses be
exempt from requests under the Freedom of Information Act); and (C) with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective; (ii) of any request by the Commission or any
other Federal or state governmental authority for amendments or supplements to
a Registration Statement or Prospectus or for additional information; (iii) of
the issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of a Registration
Statement covering any or all of the Registrable Securities or the initiation
of any Proceedings for that purpose; (iv) of the receipt by the Company of
any notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in a Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to a
Registration Statement, Prospectus or other documents so that, in the case of a
Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading; and (vi) of
the occurrence or existence of any pending corporate development with respect
to the Company that the Company reasonably believes is material and that, in
the determination of the Company, makes it not in the best interest of the
Company to allow continued availability of a Registration Statement or
Prospectus; provided, that, all of such information shall remain
confidential to each Holder (other than disclosure to Holder’s employees,
agents, affiliates, accountants, attorneys and advisors) until such information
otherwise becomes public, unless disclosure by a Holder is required by law; provided,
further, notwithstanding each Holder’s agreement to keep such
information confidential that, the Holders make no acknowledgement that any
such information provided pursuant to this Section 3(c) is material,
non-public information.

 

If the Company notifies the Holders in
accordance with clauses (ii) through (vi) of this Section 3(c) to
suspend the use of any Prospectus until the requisite changes to such
Prospectus have been made, then the Holders shall suspend use of such
Prospectus.  The Company will use its reasonable
best commercial efforts to ensure that the use of the Prospectus may be resumed
as promptly as is practicable.  The
Company shall be entitled to exercise its right under this Section 2(c) to
suspend the availability of a Registration Statement and Prospectus, subject to
the payment of partial liquidated damages pursuant to Section 2(c), for a
period not to exceed an aggregate 45 days in any 12 month period; provided,
however, that no such postponement or suspension shall be permitted for more
than a consecutive twenty (20) days.

 

 

(d)                                 Use
its reasonable best commercial efforts to avoid the issuance of, or, if issued,
obtain the withdrawal of (i) any order stopping or suspending the
effectiveness of a Registration Statement, or (ii) any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable moment.

 

(e)                                  Furnish
to each Holder upon request and without charge, at least one conformed copy of
each such Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

 

(f)                                    Promptly
deliver to each Holder, without charge, as many copies of the Prospectus or
Prospectuses (including each form of prospectus) and each amendment or
supplement thereto as such Persons may reasonably request in connection with
resales by the Holder of Registrable Securities.  Subject to the terms of this Agreement, the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders in connection with the
offering and sale of the Registrable Securities covered by such Prospectus and
any amendment or supplement thereto, except after the giving on any notice
pursuant to Section 3(d).

 

(g)                                 If
FINRA Rule 2710 requires any broker-dealer to make a filing prior to
executing a sale by a Holder, the Company shall (i) make an Issuer Filing
with the FINRA Corporate Financing Department pursuant to proposed FINRA Rule 2710(b)(10)(A)(i),
(ii) respond within five Trading Days to any comments received from FINRA
in connection therewith and (iii) and pay the filing fee required in
connection therewith.

 

(h)                                 Prior
to any resale of Registrable Securities by a Holder or any public offering of
Registrable Securities hereunder, use its reasonable best commercial efforts to
register or qualify or cooperate with the selling Holders in connection with
the registration or qualification (or exemption from the Registration or
qualification) of such Registrable Securities for the resale or sale by the
Holder, as applicable, under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder reasonably requests in
writing, to keep each registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement; provided,
that the Company shall not be required to qualify generally to do business in
any jurisdiction where it is not then so qualified, subject the Company to any
material tax in any such jurisdiction where it is not then so subject or file a
general consent to service of process in any such jurisdiction where it is not
then subject.

 

 

(i)                                     Cooperate
with the Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be delivered to a
transferee pursuant to a Registration Statement, which certificates shall be
free, to the extent permitted by the Purchase Agreement, of all restrictive
legends, and to enable such Registrable Securities to be in such denominations
and registered in such names as any such Holders may request.

 

(j)                                     Upon
the occurrence of any event contemplated by this Section 3, as promptly as
reasonably possible under the circumstances taking into account the Company’s
good faith assessment of any adverse consequences to the Company and its
stockholders of the premature disclosure of such event, prepare a supplement or
amendment, including a post-effective amendment, to a Registration Statement or
a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document
so that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

 

(k)                                  Comply
with all applicable rules and regulations of the Commission.

 

(l)                                     Cause
all Registrable Securities relating to the Registration Statement to be listed
on the Nasdaq Global Market, or other Trading Market on which similar
securities issued by the Company are then listed.

 

(m)                               In
connection with the filing of a Registration Statement, the Company may require
each selling Holder to furnish to the Company a certified statement as to the
number of shares of Common Stock beneficially owned by such Holder and, if
required by the Commission, the person thereof that has voting and dispositive
control over the Shares. During any periods that the Company is unable to meet
its obligations hereunder with respect to the registration of the Registrable
Securities solely because any Holder fails to furnish such information within
three Trading Days of the Company’s request, any liquidated damages that are
accruing at such time as to such Holder only shall be tolled and any Event that
may otherwise occur solely because of such delay shall be suspended as to such
Holder only, until such information is delivered to the Company.

 

4.                                      Registration
Expenses.

 

All fees and expenses incident to the performance of or compliance with
this Agreement by the Company shall be borne by the Company whether or not any
Registrable Securities are sold pursuant to a Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without
limitation, fees and expenses (A) with respect to filings required to be
made with the Commission and with the Trading Market on which the Common Stock
is then listed for trading, (B) in compliance with applicable state
securities or Blue Sky laws reasonably agreed to by the Company in writing
(including, without limitation, fees and disbursements of counsel for the 

 

 

Company in connection with Blue Sky qualifications or
exemptions of the Registrable Securities and determination of the eligibility
of the Registrable Securities for investment under the laws of such
jurisdictions as requested by the Holders) and (C) if not previously paid
by the Company in connection with an Issuer Filing, with respect to any filing
that may be required to be made by any broker through which a Holder intends to
make sales of Registrable Securities with FINRA pursuant to FINRA Rule 2710,
so long as the broker is receiving no more than a customary brokerage
commission in connection with such sale, (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the Registrable
Securities included in a Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel
and auditors for the Company, (v) reasonable fees and expenses of  Legal Counsel in an amount not to exceed (a) $20,000
with respect to all Registration Statements filed pursuant to Section 2
and (b) an additional $20,000 with respect to all Registration Statements
filed pursuant to Section 7(e), (vi) Securities Act liability
insurance, if the Company so desires such insurance, and (vii) fees and
expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement.  Invoices with respect to fees and expenses of
Legal Counsel shall be delivered to the Company itemized and in reasonable
detail.  In addition, the Company shall
be responsible for all of its internal expenses incurred in connection with the
consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit and the
fees and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange as required hereunder.  In no event shall the Company be responsible
for any broker or similar commissions or, except to the extent provided for in
the Transaction Documents, any legal fees or other costs of the Holders.

 

5.                                      Indemnification

 

(a)                                  Indemnification by the Company.
The Company shall, notwithstanding any termination of this Agreement, indemnify
and hold harmless each Holder, the officers, directors, members, general and
limited partners, managers, agents, brokers (including brokers who offer and sell
Registrable Securities as principal as a result of a pledge or any failure to
perform under a margin call of Common Stock), investment advisors and employees
(and any other Persons with a functionally equivalent role of a Person holding
such titles, notwithstanding a lack of such title or any other title) of each
of them, each Person who controls any such Holder (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, members, general and limited partners, managers, agents and
employees (and any other Persons with a functionally equivalent role of a
Person holding such titles, notwithstanding a lack of such title or any other
title) of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable attorneys’ fees)
and expenses (collectively, “Losses”), as incurred, arising out of or
relating to (1) any untrue or alleged untrue statement of a material fact
contained in a Registration Statement, any Prospectus or any form of prospectus
or in any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or relating to any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
(in the case of any Prospectus or form of prospectus or supplement thereto, in
light of the circumstances under which 

 

 

they were
made) not misleading or (2) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act or any state securities law, or
any rule or regulation thereunder, in connection with the performance of
its obligations under this Agreement, except to the extent, but only to the
extent, that (i) such untrue statements or omissions are based solely upon
information regarding such Holder furnished in writing to the Company by such
Holder expressly for use therein, or to the extent that such information relates
to such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing in accordance
with Section 3(c) by such Holder expressly for use in a Registration
Statement, such Prospectus or such form of Prospectus or in any amendment or
supplement thereto (it being understood that the Holder has approved Annex A
hereto for this purpose) or (ii) in the case of an occurrence of an event
of the type specified in Section 3(c)(ii)-(vi), the use by such Holder of
an outdated or defective Prospectus after the Company has notified such Holder
in writing that the Prospectus is outdated or defective and prior to the
receipt by such Holder of the Advice contemplated in Section 8(d).  The Company shall notify the Holders promptly
of the institution, threat or assertion of any Proceeding arising from or in
connection with the transactions contemplated by this Agreement of which the
Company is aware.

 

(b)                                 Indemnification by Holders. Each
Holder shall, severally and not jointly, indemnify and hold harmless the
Company, its directors, officers, agents and employees, each Person who
controls the Company (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act), and the directors, officers,
agents or employees of such controlling Persons, to the fullest extent
permitted by applicable law, from and against all Losses, as incurred, to the
extent arising solely out of or based solely upon: (x) such Holder’s
failure to comply with the prospectus delivery requirements of the Securities
Act or (y) any untrue statement of a material fact contained in any
Registration Statement, any Prospectus, or any form of prospectus, or in any
amendment or supplement thereto or in any preliminary prospectus, or arising
solely out of or based solely on to any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading (in the case of any Prospectus or form of prospectus or
supplement thereto, in the light of the circumstances under which they were
made)  (i) to the extent, but only
to the extent, that such untrue statement or omission is contained in any
information so furnished in writing by such Holder to the Company specifically
for inclusion in such Registration Statement or such Prospectus or (ii) to
the extent that (1) such untrue statements or omissions are based solely
upon information regarding such Holder furnished in writing to the Company by
such Holder expressly for use therein, or to the extent that such information
relates to such Holder or such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing by
such Holder expressly for use in a Registration Statement (it being understood
that the Holder has approved Annex A hereto for this purpose), such Prospectus
or such form of Prospectus or in any amendment or supplement thereto or (2) in
the case of an occurrence of an event of the type specified in Section 3(c)(ii)-(vi),
the use by such Holder of an outdated or defective Prospectus after the Company
has notified such Holder in writing in accordance with Section 3(c) that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated in Section 8(d). In no event shall the
liability of any selling Holder hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.

 

 

(c)                                  Conduct of Indemnification Proceedings.
If any Proceeding shall be brought or asserted against any Person entitled to
indemnity hereunder (an “Indemnified Party”), such Indemnified Party
shall promptly notify the Person from whom indemnity is sought (the “Indemnifying
Party”) in writing, and the Indemnifying Party shall have the right to
assume the defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all fees and expenses
incurred in connection with defense thereof; provided, that the failure of any
Indemnified Party to give such notice shall not relieve the Indemnifying Party
of its obligations or liabilities pursuant to this Agreement, except (and only)
to the extent that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further review)
that such failure shall have materially prejudiced the Indemnifying Party.

 

An Indemnified Party shall have
the right to employ separate counsel in any such Proceeding and to participate
in the defense thereof, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party or Parties unless:  (1) the Indemnifying Party has agreed in
writing to pay such fees and expenses; (2) the Indemnifying Party shall
have failed promptly to assume the defense of such Proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such
Proceeding; or (3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall reasonably believe that a material
conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Party and the Indemnifying Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and
the reasonable fees and expenses of one separate counsel shall be at the
expense of the Indemnifying Party).  The
Indemnifying Party shall not be liable for any settlement of any such
Proceeding effected without its written consent, which
consent shall not be unreasonably withheld or delayed.  No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
pending or threatened Proceeding in respect of which any Indemnified Party is a
party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter of
such Proceeding.

 

Subject to the terms of this
Agreement, all reasonable fees and expenses of the Indemnified Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party, as
incurred, within ten Trading Days of written notice thereof to the Indemnifying
Party; provided, that the Indemnified Party shall promptly reimburse the
Indemnifying Party for that portion of such fees and expenses applicable to
such actions for which it is finally judicially determined (not subject to
appeal) such Indemnified Party is not entitled to indemnification hereunder,
determined based upon the relative faults of the parties.

 

(d)                                 Contribution. If the
indemnification under Section 5(a) or 5(b) is unavailable to an
Indemnified Party for any reason or insufficient to hold an Indemnified Party
harmless for any Losses, then each Indemnifying Party shall contribute to the
amount paid or payable by such Indemnified Party, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.

 

 

The relative
fault of such Indemnifying Party and Indemnified Party shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission.  The amount paid or payable by a party as a
result of any Losses shall be deemed to include, subject to the limitations set
forth in this Agreement, any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with any Proceeding to the extent
such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such party
in accordance with its terms.

 

The parties hereto agree that
it would not be just and equitable if contribution pursuant to this Section 5(d) were
determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to in the
immediately preceding paragraph.  Notwithstanding
the provisions of this Section 5(d), In no event shall any selling Holder
be required to contribute an amount under this Section 5(d) in excess
of the net proceeds received by such Holder upon sale of such Holder’s
Registrable Securities pursuant to the Registration Statement giving rise to
such contribution obligation., except in the case of fraud by such Holder.

 

The indemnity and contribution
agreements contained in this Section are in addition to any liability that
the Indemnifying Parties may have to the Indemnified Parties.

 

6.                                      Reports
Under Exchange Act

 

With a view to making available to the Holder the benefits of Rule 144
promulgated under the Securities Act and any other rule or regulation of
the Commission that may at any time permit a Holder to sell Registrable Shares
of the Company to the public without registration, the Company agrees to:

 

(a)                                  Make
and keep public information available, as those terms are used in Rule 144,
at all times;

 

(b)                                 File
with the Commission in a timely manner all reports and other documents required
of the Company under the Securities Act, the Exchange Act and the rules and
regulations of the Trading Market;

 

(c)                                  Furnish
to any Holder, so long as the Holder owns any Registrable Shares, forthwith on
request, (i) a written statement by the Company that it has complied with
the reporting requirements of Rule 144, the Securities Act and the
Exchange Act, (ii) a copy of the most recent annual or quarterly report of
the Company and such other reports and documents so filed by the Company, and (iii) such
other information as may be reasonably requested in availing any Holder of any rule or
regulation of the Commission that permits the selling of any such securities
without registration; and

 

(d)                                 Undertake
any additional actions reasonably necessary to maintain the availability of the
use of Rule 144, the Company’s eligibility to file and maintain 

 

 

continuously
effective Form S-3 registration statements and any future rules adopted
by the Commission permitting the resale of the Registrable Securities.

 

7.                                      Other
Rights and Covenants

 

(a)                                  Board
of Directors.

 

(i)                                     In
the event the Purchasers exercise the Unit Warrant pursuant to the Warrant
Agreement and for so long as the Purchasers’ beneficial ownership percentage interest
in the Company is at least 19%, the Purchasers shall have the right to appoint
an individual to serve as a voting member of the Company’s Board of Directors
(the “Series B Director”), the sole right to remove any such
individual appointed and to fill any vacancies of a Series B
Director.  This right shall be in
addition to any right the Purchasers may have to appoint a Preferred Director
and/or Preferred Board Observer pursuant to Section 3(b) of the
Certificate of Designation or pursuant to Section 7(a)(ii);
provided, however, the appointment of the Series B Director shall be in
lieu of a Preferred Board Observer.  For
purposes of this Section 7(a)(i), beneficial ownership shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder.  At
any time, upon the written request of the Purchasers whose beneficial ownership
percentage interest is at least 19%, addressed to the secretary of the Company,
the Company will call a special meeting of the Board of Directors or cause the
execution of a written consent of the Board of Directors, pursuant to Section 141(f) of
the DGCL, to appoint, remove or fill any opening for a Series B Director.

 

(ii)                                  In the event the
Purchasers no longer have the right pursuant to Section 3(b) of the
Certificate of Designation to appoint a Preferred Director and a Preferred
Board Observer, so long as the Purchasers hold a majority of the shares of
Common Stock issued or issuable upon conversion of the outstanding Series A
Preferred Stock and Series B Preferred Stock purchased by the Purchasers
pursuant to the Purchase Agreement or the Warrant Agreement, the Purchasers
shall have the special right, to the exclusion of all other classes or series
of the Company’s capital stock, to appoint an individual to serve as a voting
member of the Company’s Board of Directors, which member shall be a designee of
the Purchasers (the “Preferred Conversion Director”), and to appoint an
individual to serve as a non voting observer of the Company’s Board of
Directors, which individual shall be a designee of the Purchasers (the “Preferred
Conversion Board Observer”), the sole right to remove any such individual
appointed and to fill any vacancies of a Preferred Conversion Director or
Preferred Conversion Board Observer.  At
any time, upon the 

 

 

written request of the Purchasers addressed
to the secretary of the Company, the Company will call a special meeting of the
Board of Directors or cause the execution of a written consent of the Board of
Directors, pursuant to Section 141(f) of the DGCL, to appoint, remove
or fill any opening for a Preferred Conversion Director and/or Preferred
Conversion Board Observer.  The Preferred
Conversion Board Observer shall have the right to attend all meetings of the
Board of Directors (and committees thereof) in a non voting capacity and the
Company shall give the Preferred Conversion Board Observer copies of all
notices, minutes, consents and other materials that it provides to its
directors (when such materials are provided to the Board of Directors);
provided, however, that such representative shall agree to hold in confidence
and trust and to act in a fiduciary manner with respect to all information so
provided.

 

(iii)                               The Company shall take
all actions within its control to provide the Purchasers with the
representation on the Board of Directors contemplated by this Section 7,
including without limitation, (i) causing each designee or appointee of
the Purchasers to be included in the slate of nominees recommended by the Board
of Directors to the Company’s stockholders for election as a director, as
applicable, and (ii) causing the election of each such designee or
appointee, including using its reasonable best efforts to cause officers of the
Company who hold proxies (unless otherwise directed by the stockholder
submitting such proxy) to vote such proxies in favor of the election of each
such designee or appointee. For so long as the Purchasers are entitled to elect
director(s) pursuant to this Section 7 or the Certificate of
Designation or the Series B Certificate of Designation, as applicable,
upon the written request of the Purchasers, the Company shall use its
reasonable best efforts to cause the Board of Directors to remove the
applicable designee or appointee of the Purchasers that the Purchasers request
for removal from the Board of Directors (with or without cause), and (ii) in
the event that a designee or appointee of the Purchasers shall cease to serve
as a director for any reason, the Company shall use its reasonable best efforts
to cause any vacancy resulting thereby to be filled by another designee or
appointee designated by the Purchasers, as the case may be.

 

(iv)                              For so long as the
Purchasers are represented on the Board of Directors, the Purchasers shall be
entitled to appoint a member of the Compensation Committee of the Board of
Directors.

 

(v)                                 The Company shall
promptly reimburse in full each Preferred Director, Preferred Board Observer, Series B
Director, Preferred Conversion Director and Preferred Conversion Board 

 

 

Observer, as the case may be, of the Company
who is not an employee of the Company for all such director’s or non-voting
observer’s reasonable out-of-pocket expenses incurred in attending each meeting
of the Board of Directors of the Company or any committee thereof or in
connection with the performance of his or her services as a director.

 

(b)                                 Transferees
and Assignees.  If any of the
Registrable Securities are transferred or assigned by a Holder in accordance
with the terms of the Transaction Documents and the Warrant Agreement, then,
upon request by the transferring Holder, the Company shall use its reasonable
best efforts (to the greatest extent and at the earliest opportunity
practicable and in any event not later than 20 days after the earliest
practicable date permitted under applicable guidance of the Commission and the
Trading Market upon which the Registrable Securities are listed and traded) to
enable such transferee or assignee to resale such transferred or assigned
Registrable Securities using the Registration Statement filed and made
effective pursuant to this Agreement and the related Prospectus by filing a
post-effective amendment or prospectus supplement, naming such transferee or
assignee as a selling under such Registration Statement and Prospectus.

 

8.                                      Miscellaneous

 

(a)                                  Remedies.  In the event of a breach by the Company or by
a Holder, of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this
Agreement.  The Company and each Holder
agree that monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

 

(b)                                 No Piggyback on Holder Registrations.  No Person has any right to cause the Company
to effect a registration under the Securities Act of any securities of the
Company or to include securities of the Company in the initial Registration
Statement pursuant to Section 2(a) other than the Registrable
Securities.  Neither the Company  nor any of
its security holders (other than the Holders in such capacity pursuant hereto)
may include securities of the Company in the initial Registration.  The Company shall not file any other
registration statements until the initial Registration Statement required
hereunder is declared effective by the Commission; provided that this Section 8(b) shall
not prohibit the Company from filing amendments to registration statements
already filed.

 

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

 

 

(d)                                 Discontinued Disposition. Each
Holder agrees by its acquisition of such Registrable Securities that, upon
receipt of a notice from the Company of the occurrence of any event of the kind
described in Section 3(c), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until
such Holder’s receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement, or until it is advised in writing (the “Advice”)
by the Company that the use of the applicable Prospectus may be resumed, and,
in either case, has received copies of any additional or supplemental filings
that are incorporated or deemed to be incorporated by reference in such Prospectus
or Registration Statement.  The Company
will use its best efforts to ensure that the use of the Prospectus may be
resumed as promptly as it practicable. 
The Company agrees and acknowledges that any periods during which the
Holder is required to discontinue the disposition of the Registrable Securities
hereunder shall be subject to the provisions of Section 2(c).

 

(e)                                  Piggy-Back Registrations. If at
any time during the Effectiveness Period there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall
determine to prepare and file with the Commission a registration statement
relating to an offering for its own account or the account of others under the
Securities Act of any of its equity securities, other than on Form S-4 or Form S-8
(each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in connection
with stock option or other employee benefit plans, then the Company shall send
to the Holder written notice of such determination and, if within twenty 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 such
Registrable Securities such Holder requests to be registered, subject to
customary underwriter cutbacks applicable to all holders of registration
rights, if any, due to a reasonable objection from the underwriters that the
inclusion of such Registrable Securities would materially adversely affect the
contemplated offering; provided, however, that, Registrable
Securities of such Holder and securities of other holders of registration
rights shall constitute a minimum of 30% of the securities to be registered on
such registration statement; provided, further, that no other
stockholder’s securities are included in such offering in which a Holder’s
Registrable Securities are cutback and provided, further, that
the Company shall not be required to register any Registrable Securities
pursuant to this Section 8(e) that are eligible for resale pursuant
to Rule 144(b)(1) promulgated under the Securities Act or that are
the subject of a then effective Registration Statement.

 

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

 

 

the
provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding sentence.

 

(g)                                 Notices. Any and all notices or
other communications or deliveries required or permitted to be provided hereunder
shall be delivered as set forth in the Purchase Agreement.

 

(h)                                 Successors and Assigns. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of each of the parties and shall inure to the benefit of each
Holder. The Company may not assign its rights or obligations hereunder without
the prior written consent of all of the Holders of the then-outstanding
Registrable Securities. Each Holder may assign their respective rights
hereunder in the manner and to the Persons as permitted under the Purchase
Agreement, including, without limitation, to affiliates of any Holder or any
general partner, limited partners or members of a Holder or of such Holder’s
affiliates.

 

(i)                                     No Inconsistent Agreements.
Neither the Company nor any of its subsidiaries has entered, as of the date
hereof, nor shall the Company or any of its subsidiaries, on or after the date
of this Agreement, enter into any agreement with respect to its securities,
that would have the effect of impairing the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof.  Neither the Company nor any of its
subsidiaries has previously entered into any agreement granting any registration
rights with respect to any of its securities to any Person that have not been
satisfied in full.

 

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

 

(k)                                  Governing Law.  All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined in accordance with the provisions of the
Purchase Agreement.

 

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

 

(m)                               Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions set forth herein shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated, and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction.
It is hereby stipulated and declared to be the intention of the parties that
they would have executed the remaining 

 

 

terms,
provisions, covenants and restrictions without including any of such that may
be hereafter declared invalid, illegal, void or unenforceable.

 

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

 

(o)                                 Independent Nature of Holders’ Obligations
and Rights. The obligations of each Holder hereunder are several and
not joint with the obligations of any other Holder hereunder, and no Holder
shall be responsible in any way for the performance of the obligations of any
other Holder hereunder. Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Holder pursuant
hereto or thereto, shall be deemed to constitute the Holders as a partnership,
an association, a joint venture or any other kind of entity, or create a presumption
that the Holders are in any way acting in concert with respect to such
obligations or the transactions contemplated by this Agreement. Each Holder
shall be entitled to protect and enforce its rights, including without
limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Holder to be joined as an additional party in any
proceeding for such purpose.

 

(p)                                 Aggregation
of Stock.  All shares of Registrable
Securities held or acquired by affiliated entities (including affiliated
venture capital funds) or persons shall be aggregated together for the purpose
of determining the availability of any rights under this Agreement.

 

 

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

 

 

	
   

  	
  ANSWERS CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert S. Rosenschein

  
	
   

  	
   

  	
      Name:  Robert S. Rosenschein

  
	
   

  	
   

  	
      Title:    Chief Executive
  Officer

  

 

 

[SIGNATURE PAGE OF HOLDERS TO REGISTRATION
RIGHTS AGREEMENT]

 

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

 

Redpoint Omega, L.P., by its General Partner
Redpoint Omega, LLC

 

Redpoint Omega Associates LLC, as nominee

 

 

	
  By:

  	
  /s/ W. Allen Beasley

  	
   

  
	
      Name:

  	
  W. Allen Beasley

  
	
      Title:

  	
  Managing Director

  
				

 

 

 

Annex A

 

Plan of Distribution

 

Each Selling Stockholder (the “Selling Stockholders”) of the
common stock (“Common Stock”) of Answers Corporation, a Delaware
corporation (the “Company”) and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on the Trading Market or any other stock exchange, market or
trading facility on which the shares are traded or in private
transactions.  These sales may be at
fixed or negotiated prices.  A Selling
Stockholder may use any one or more of the following methods when selling
shares:

 

·      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;

 

·      settlement of short sales entered into after the effective
date of the registration statement of which this prospectus is a part;

 

·      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;

 

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

 

·      any other method permitted pursuant to applicable law.

 

The Selling Stockholders may also sell shares under Rule 144 under
the Securities Act of 1933, as amended (the “Securities Act”), if available,
rather than under this prospectus.  The
Selling Stockholders have the sole and absolute discretion not to accept any
purchase offer or make any sale of shares if they deem the purchase price to be
unsatisfactory at any particular time.

 

 

Broker-dealers engaged by the Selling Stockholders may arrange for
other brokers-dealers to participate in sales. 
Broker-dealers may receive commissions or discounts from the Selling
Stockholders (or, if any broker-dealer acts as agent for the purchaser of
shares, from the purchaser) in amounts to be negotiated, but, except as set
forth in a supplement to this Prospectus, in the case of an agency transaction
not in excess of a customary brokerage commission in compliance with NASDR Rule 2440;
and in the case of a principal transaction a markup or markdown in compliance
with NASDR IM-2440.

 

In connection with the sale of the 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 the 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 Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be “underwriters” within the
meaning of the Securities Act in connection with such sales.  In such event, any commissions received by
such broker-dealers or agents and any profit on the resale of the shares
purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act.  Each Selling
Stockholder has informed the Company that it does not have any written or oral
agreement or understanding, directly or indirectly, with any person to
distribute the Common Stock.

 

The Company is required to pay certain fees and expenses incurred by
the Company incident to the registration of the shares.  The Company has agreed to indemnify the
Selling Stockholders against certain losses, claims, damages and liabilities,
including liabilities under the Securities Act.

 

Because Selling Stockholders may be deemed to be “underwriters” within
the meaning of the Securities Act, they will be subject to the prospectus
delivery requirements of the Securities Act. 
In addition, any securities covered by this prospectus which qualify for
sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144
rather than under this prospectus.  Each Selling
Stockholder has advised us that they have not entered into any written or oral
agreements, understandings or arrangements with any underwriter or
broker-dealer regarding the sale of the resale shares.  There is no underwriter or coordinating
broker acting in connection with the proposed sale of the resale shares by the
Selling Stockholders.

 

We agreed to keep this prospectus effective Act until the earlier of (i) beginning
1 year after the date hereof, all of the Registrable Securities covered by such
Registration Statement have been sold and (ii) 100% of the Registrable
Securities may be sold without volume restrictions pursuant to Rule 144(b)(1) as determined by the counsel to the Company
pursuant to a written opinion letter to such effect, addressed and acceptable
to the Company’s transfer agent and the affected Holders.  The resale shares will be sold only through
registered or licensed 

 

 

brokers
or dealers if required under applicable state securities laws. In addition, in
certain states, the resale shares may not be sold unless they have been
registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied
with.

 

Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the resale shares may not simultaneously
engage in market making activities with respect to the Common Stock for the
applicable restricted period, as defined in Regulation M, prior to the commencement
of the distribution.  In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M,
which may limit the timing of purchases and sales of shares of the Common Stock
by the Selling Stockholders or any other person.  We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to the time of
the sale.

 

 

Annex B

 

ANSWERS CORPORATION

 

Selling Securityholder Notice and Questionnaire

 

The undersigned beneficial
owner of common stock, no par value per share (the “Common Stock”), of
Answers Corporation, a Delaware corporation (the “Company”), (the “Registrable
Securities”) understands that the Company has filed or intends to file with
the Securities and Exchange Commission (the “Commission”) a registration
statement on Form S-3  (the “Registration
Statement”) for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the “Securities Act”), of the
Registrable Securities, in accordance with the terms of the Registration Rights
Agreement, dated as of June 16, 2008 (the “Registration Rights
Agreement”), among the Company and the Purchasers named therein.  A copy of the Registration Rights Agreement
is available from the Company upon request at the address set forth below.  All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.

 

Certain legal consequences
arise from being named as a selling securityholder in the Registration
Statement and the related prospectus. 
Accordingly, holders and beneficial owners of Registrable Securities are
advised to consult their own securities law counsel regarding the consequences
of being named or not being named as a selling securityholder in the
Registration Statement and the related prospectus.

 

NOTICE

 

The undersigned beneficial
owner (the “Selling Securityholder”) of Registrable Securities hereby
elects to include the Registrable Securities owned by it and listed below in
Item 3 (unless otherwise specified under such Item 3) in the Registration
Statement.

 

 

The undersigned hereby provides the following
information to the Company and represents and warrants that such information is
accurate:

 

QUESTIONNAIRE

 

	
  1.

  	
  Name.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Full Legal Name of Selling
  Securityholder

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Full Legal Name of
  Registered Holder (if not the same as (a) above) through which
  Registrable Securities Listed in Item 3 below are held:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Full Legal Name of Natural
  Control Person (which means a natural person who directly or indirectly alone
  or with others has power to vote or dispose of the securities covered by the
  questionnaire):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  2.  Address for Notices to Selling
  Securityholder:

  
	
   

  
	
   

  
	
   Telephone:

  
	
   Fax:

  
	
   Contact
  Person:

  
	
   

  
	
  3.  Beneficial Ownership of Registrable
  Securities:

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Type and Principal Amount
  of Registrable Securities beneficially owned (not including the Registrable
  Securities that are issuable pursuant to the Purchase Agreement):

  
	
   

  	
   

  	
   

  

 

 

	
  4. 
  Broker-Dealer Status:

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Are you a broker-dealer?

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Yes o  No o

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  If “yes” to
  Section 4(a), did you receive your Registrable Securities as
  compensation for investment banking services to the Company.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Yes o  No o

  
	
   

  	
   

  	
   

  
	
   

  	
  Note:

  	
  If no, the Commission’s
  staff has indicated that you should be identified as an underwriter in the
  Registration Statement.

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Are you an affiliate of a
  broker-dealer?

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Yes o  No o

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  If you are an affiliate of
  a broker-dealer, do you certify that you bought the Registrable Securities in
  the ordinary course of business, and at the time of the purchase of the
  Registrable Securities to be resold, you had no agreements or understandings,
  directly or indirectly, with any person to distribute the Registrable
  Securities?

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Yes o  No o

  
	
   

  	
   

  	
   

  
	
   

  	
  Note:

  	
  If no, the Commission’s
  staff has indicated that you should be identified as an underwriter in the
  Registration Statement.

  
	
   

  	
   

  	
   

  
	
  5.  Beneficial Ownership of Other Securities of
  the Company Owned by the Selling Securityholder.

  
	
   

  	
   

  	
   

  
	
   

  	
  Except
  as set forth below in this Item 5, the undersigned is not the beneficial or
  registered owner of any securities of the Company other than the Registrable
  Securities listed above in Item 3.

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Type and Amount of Other
  Securities beneficially owned by the Selling Securityholder:

  
	
   

  	
   

  	
   

  

 

 

6. 
Relationships with the Company:

 

Except as set forth below, neither the undersigned nor any
of its affiliates, officers, directors or principal equity holders (owners of
5% of more of the equity securities of the undersigned) has held any position
or office or has had any other material relationship with the Company (or its
predecessors or affiliates) during the past three years.

 

State any exceptions here:

 

 

 

The undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information
provided herein that may occur subsequent to the date hereof at any time while
the Registration Statement remains effective.

 

By signing below, the undersigned
consents to the disclosure of the information contained herein in its answers
to Items 1 through 6 and the inclusion of such information in the Registration
Statement and the related prospectus and any amendments or supplements thereto.  The undersigned understands that such
information will be relied upon by the Company in connection with the
preparation or amendment of the Registration Statement and the related
prospectus.

 

IN WITNESS WHEREOF the
undersigned, by authority duly given, has caused this Notice and Questionnaire
to be executed and delivered either in person or by its duly authorized agent.

 

	
  Dated:

  	
   

  	
   

  	
  Beneficial
  Owner: 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  
						

 

PLEASE FAX A COPY OF THE COMPLETED AND
EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN THE ORIGINAL BY OVERNIGHT MAIL,
TO:ex101.htm

    EXHIBIT
10.1

    STOCK PURCHASE
AGREEMENT

    

    

    THIS STOCK PURCHASE AGREEMENT
(the "Agreement") is entered into on the 17th day of June, 2008, by and among
Narayan Capital Funding Corp., Inc., a Florida corporation (“Buyer”),
Willowhuasca Wellness, Inc. (“Seller”), and Narayan Capital Corp., a Florida
corporation (the “Company”).

    

    EXPLANATORY STATEMENT

    

    WHEREAS, Seller desires to
sell, and Buyer desires to acquire, all of the outstanding common stock of the
Company (the "Common Stock"), on the terms described below; and

    

    WHEREAS, the Company and Buyer
desire that Law Offices of Michael H. Hoffman, P.A. continue to serve as legal
counsel to the Company and provide on-going legal services, including advice on
corporate and securities law matters.

    

    NOW, THEREFORE, in
consideration of the premises and the mutual covenants, conditions and promises
hereinafter set forth, the parties hereto agree as follows:

    

    1. PURCHASE AND
SALE.

    

    1.1 Shares.  On
the terms and subject to the conditions herein provided, Seller agrees to sell,
transfer and assign to Buyer, and Buyer agrees to purchase and acquire from
Seller, on the Closing Date (as defined in Section 1.4 below), Two Million Seven
Hundred Thousand (2,700,000) shares (the “Shares”) of Common
Stock.  The Company has issued and outstanding an aggregate of Three
Million (3,000,000) shares of common stock.

    

    1.2 Excluded
Liabilities.  Buyer will not acquire, and Seller shall pay or
cause the Company to pay, all of the Company’s liabilities as of the Closing
Date.

    

    1.3 Purchase
Price.

    

    (1) Purchase
Price.  The aggregate purchase price for the Shares to be sold
by Seller and to be purchased by Buyer is Ten Thousand Dollars ($10,000), which
is payable upon the closing of this Agreement.

    

    (2) Manner of
Payment.  Buyer shall pay the Purchase Price by check or wire
transfer of immediately available funds to an account designated by
Seller.

    

    1.4 Closing; Effective
Date.  Subject to the satisfaction of the conditions stated in
Section 6, the closing of the transactions contemplated by this Agreement (the
“Closing”) shall take place at the Seller's office at 12:00 p.m. P.S.T. on the
date first above written (the “Closing Date”).

    

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    1.5 Transactions and Documents
at Closing.

    

    (1) Deliveries by Seller and the
Company.  At the Closing, Seller and the Company shall deliver
to Buyer:

    

    
      	
              (1)  

            	
              the
      certificate representing the Shares in proper form for transfer to
      Buyer;

            

    

    

    
      	
              (2)  

            	
              the
      resignation of the Company’s sole officer and
  director;

            

    

    

    
      	
              (3)  

            	
              the
      stock ledger, minute book, corporate seal and books and records of the
      Company; and

            

    

    

    
      	
              (4)  

            	
              a
      certified copy of all necessary corporate action approving the Company’s
      execution, delivery and performance of this
  Agreement.

            

    

    

    (2) Deliveries by
Buyer.  At the Closing, Buyer shall deliver to
Seller:

    

    
      	
              (1)  

            	
              payment
      of the Purchase Price; and

            

    

    

    
      	
              (2)  

            	
              a
      certified copy of all necessary corporate action approving Buyer’s
      execution, delivery and performance of this
  Agreement.

            

    

    

    2. ADDITIONAL
AGREEMENTS.

    

    2.1 Legal
Services.  The Company shall continue to engage the Law Offices
of Michael H. Hoffman, P.A. to serve as legal counsel to the Company and provide
on-going legal services, including advice on corporate and securities law
matters.  The term of such engagement shall be for a period of one
year, commencing on the Closing Date, and ending on the first anniversary of the
Closing Date (the “Term”).  If such engagement is not terminated by
the Company prior to ninety (90) days before the expiration of the Term (or any
extension thereof), the Term shall automatically be extended for an additional
one year period.  This automatic extension shall apply to each
subsequent one year period that the Term is extended.

    

    2.2 Cooperation; Further
Assurances.  Each of the parties hereto will cooperate with the
other and execute and deliver to the other parties hereto such other instruments
and documents, provide such other notices or communications and take such other
actions as may be reasonably requested from time to time by any other party
hereto as necessary to carry out the intended purposes of this
Agreement.

    

    3. REPRESENTATIONS, COVENANTS
AND WARRANTIES OF SELLER AND THE COMPANY.

    

    To induce
Buyer to enter into this Agreement and to consummate the transactions
contemplated hereby, Seller and the Company represent and warrant to and
covenant with Buyer as follows:

    

    3.1 Organization.  Each
of the Company and the Seller is a corporation duly organized, validly existing
and in good standing under the laws of the State of Florida.

    

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    3.2 Execution; No Inconsistent
Agreements.

    

    (1) The
execution and delivery of this Agreement and the performance of the transactions
contemplated hereby have been duly and validly authorized and approved by Seller
and the Company, and this Agreement is a valid and binding agreement of Seller
and the Company, enforceable against Seller and the Company in accordance with
its terms.

    

    (2) The
execution and performance of this Agreement by Seller does not constitute a
breach or violation of the organizational or governing documents of Seller or
the Company, or a material default under any of the terms, conditions or
provisions of (or an act or omission that would give rise to any right of
termination, cancellation or acceleration under) any agreement or obligation to
which Seller or the Company is a party.

    

    3.3 Title to
Shares.  Seller shall transfer to Buyer good and valid title to
the Shares, free and clear of all liens and encumbrances.

    

    4. REPRESENTATIONS, COVENANTS
AND WARRANTIES OF BUYER.

    

    To induce
Seller and the Company to enter into this Agreement and to consummate the
transactions contemplated hereby, Buyer represents and warrants to and covenants
with Seller and the Company as follows:

    

    4.1 Organization;
Compliance.   Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Florida.

    

    4.2  Execution; No Inconsistent
Agreements; Etc.

    

    (1) The
execution and delivery of this Agreement and the performance of the transactions
contemplated hereby have been duly and validly authorized and approved by Buyer
and this Agreement is a valid and binding agreement of Buyer, enforceable
against Buyer in accordance with its terms.

    

    (2) The
execution and delivery of this Agreement by Buyer does not, and the consummation
of the transactions contemplated hereby will not, constitute a breach or
violation under any of the terms, conditions or provisions of (or an act or
omission that would give rise to any right of termination, cancellation or
acceleration under) any agreement or obligation to which Buyer is a
party.

    

    4.3 Investment
Representation.  Buyer understands and acknowledges that (a)
the Shares have not been registered under the Securities Act of 1933, as amended
(the “Securities Act”), or under any state securities laws in reliance upon
exemptions provided thereunder and that the Shares may not be transferred or
sold except pursuant to the registration provisions of the Securities Act or
pursuant to an applicable exemption therefrom and pursuant to state securities
laws and regulations, as applicable, and (b) the representations and warranties
contained herein are being relied upon by the Company and Seller as a basis for
the exemption for the transfer of the Shares pursuant to this Agreement under
the registration requirements of the Securities Act and any applicable state
securities laws.  Buyer is acquiring the Shares for Buyer's own
account for the purpose of investment and not with a view to, or for sale in
connection with, any distribution thereof in violation of the Securities
Act.  Buyer has had the opportunity to review the books and records of
the Company and has been furnished or provided access to such relevant
information that Buyer has requested.  Buyer is knowledgeable,
sophisticated and experienced in business and financial matters of the type
contemplated by this Agreement and is able to bear the risks associated with an
investment in the Company.  Buyer has considered the investment in the
Shares and has had an opportunity to ask questions of and receive answers from
the sole officer and director of the Company about the Shares and the business
and financial condition of the Company sufficient to enable it to evaluate the
risks and merits of its investment in the Company.

    

    4.4 Status of
Buyer.  Buyer is an “accredited investor" within the meaning of
Rule 501 promulgated under the Securities Act.

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    

    5. BUYER'S ACCESS TO
INFORMATION AND ASSETS.  Buyer and its authorized
representatives, at Buyer’s own expense, shall have access to the books,
records, employees, counsel, accountants, and other representatives of the
Company at all times reasonably requested by Buyer for the purpose of conducting
an investigation of the Company's financial condition, corporate status,
operations, business, assets and properties.

    

    

    6. CLOSING
CONDITIONS.

    

    6.1 Conditions to Obligations of
Seller.  The obligations of Seller to carry out the
transactions contemplated by this Agreement are subject, at the option of
Seller, to the following conditions:

    

    (1) Buyer
shall have furnished Seller with a certified copy of all necessary corporate
action on its behalf approving its execution, delivery and performance of this
Agreement.

    

    (2) All
representations and warranties of Buyer contained in this Agreement shall be
true and correct in all material respects at and as of the Closing, as if such
representations and warranties were made at and as of the Closing, and Buyer
shall have performed and satisfied in all material respects all covenants and
agreements required by this Agreement to be performed and satisfied by Buyer at
or prior to the Closing; provided, however, that Seller shall not be entitled to
refuse to consummate the transactions contemplated by this Agreement in reliance
upon its own breach or failure to perform.

    

    (3) Buyer
shall have executed and delivered to Seller the documents referred to in Section
1.5.2.2.

    

    6.2 Conditions to Obligations of
Buyer.  The obligations of Buyer to carry out the transactions
contemplated by this Agreement are subject, at the option of Buyer, to the
satisfaction of the following conditions:

    

    (1) The
Company shall have furnished Buyer with a certified copy of all necessary
corporate action on its behalf approving its execution, delivery and performance
of this Agreement.

    

    (2) All
representations and warranties of Seller and the Company contained in this
Agreement shall be true and correct in all material respects at and as of the
Closing, as if such representations and warranties were made at and as of the
Closing, and Seller and the Company shall have performed and satisfied in all
material respects all agreements and covenants required by this Agreement to be
performed and satisfied by Seller and the Company at or prior to the Closing;
provided, however, that Buyer shall not be entitled to refuse to consummate the
transactions contemplated by this Agreement in reliance upon its own breach or
failure to perform.

    

    (3) Seller
and the Company shall have executed and delivered to Buyer the documents
referred to in Section 1.5.1.

    

    7. MISCELLANEOUS.

    

    7.1 Notices.

    

    (1) All
notices, requests, demands, or other communications required or permitted
hereunder shall be in writing and shall be deemed to have been duly given upon
receipt if delivered in person, one (1) business day after the date of mailing
by Federal Express or other reputable overnight courier service or upon the
expiration of three (3) days after the date of posting, if mailed by certified
mail return receipt requested, postage prepaid, to the parties at the following
addresses:

    

    (i)  If
to Seller or
Company:                Willowhuasca
Wellness, Inc.

    9116
Byron Avenue

    Surfside,
Florida 33154

    

    
         
(ii)  If
to
Buyer:                                    
Narayan
Capital Funding Corp.

    

    9116
Byron Avenue

    Surfside,
Florida 33154

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    

    (2) Any party
may change the address to which notices, requests, demands or other
communications to such party shall be delivered or mailed by giving notice
thereof to the other parties hereto in the manner provided herein.

    

    7.2 Counterparts; Entire
Agreement.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same agreement.  This Agreement supersedes all
prior discussions and agreements between the parties with respect to the subject
matter hereof, and this Agreement contains the sole and entire agreement among
the parties with respect to the matters covered hereby.  This
Agreement shall not be altered or amended except by an instrument in writing
signed by or on behalf of all of the parties hereto.

    

    7.3 Governing
Law.  The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of Florida.

    

    7.4 Successors and Assigns;
Assignment.  This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, and successors; provided, however, that no
party hereto may assign this Agreement or any of its rights hereunder, in whole
or in part, except upon the prior written consent of the other parties
hereto.

    

    

    

    

    

    

    

    

    

    [SIGNATURES
CONTINUED ON THE FOLLOWING PAGE]

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    

    

    

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

    

    

    SELLER:

    

    WILLOWHUASCA
WELLNESS, INC.

    

    

    By:  /s/ Colleen
Foyo                                                                           

         Colleen
Foyo, President

    

    COMPANY:

    

    NARAYAN
CAPITAL CORP.

    

    

    By:  /s/ Colleen
Foyo                                                                           

         Colleen
Foyo, President

    

    BUYER:

    

    NARAYAN
CAPITAL FUNDING CORP

    

    

    By:   /s/ Robert
Papiri                                                                           

         Robert
Papiri, President

    
      
        
        

      

      
        -6-

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