Document:

REGISTRATION RIGHTS AGREEMENT

 

Registration Rights
Agreement (the “Agreement”), dated as of July 25, 2012, by and between INNOLOG HOLDINGS CORPORATION, a corporation
organized under the laws of Nevada, USA (the “Company”), and Dutchess Opportunity Fund, II, LP, a Delaware Limited
Partnership (the “Investor”).

 

Whereas, in
connection with the Investment Agreement by and between the Company and the Investor of this date (the “Investment Agreement”),
the Company has agreed to issue and sell to the Investor up to XX,000,000 shares of the Company’s Common Stock, .001 par
value per share (the “Common Stock”), to be purchased pursuant to the terms and subject to the conditions set
forth in the Investment Agreement; and

 

Whereas, to
induce the Investor to execute and deliver the Investment Agreement, the Company has agreed to provide certain registration rights
under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively,
the “1933 Act”), and applicable state securities laws, with respect to the shares of Common Stock issuable pursuant
to the Investment Agreement.

 

Now therefore, in consideration
of the foregoing promises and the mutual covenants contained hereinafter and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Investor hereby agree as follows:

 

Section 1.        DEFINITIONS.

 

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

 

“Execution
Date” means the date of this Agreement set forth above.

 

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

 

“Principal
Market” shall mean Nasdaq Capital Market, the NYSE Amex, the New York Stock Exchange, the Nasdaq Global Market, the Nasdaq
Global Select Market, the OTC Bulletin Board or the OTC Markets, whichever is the principal market on which the Common Stock of
the Company is listed or quoted.

 

“Register,”
“Registered,” and “Registration” refer to the Registration effected by preparing and filing
one (1) or more Registration Statements in compliance with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any successor
rule providing for offering securities on a continuous basis (“Rule 415”), and the declaration or ordering of
effectiveness of such Registration Statement(s) by the United States Securities and Exchange Commission (the “SEC”).

 

“Registrable
Securities” means (i) the shares of Common Stock issued or issuable pursuant to the Investment Agreement, and (ii) any
shares of capital stock issued or issuable with respect to such shares of Common Stock, if any, as a result of any stock split,
stock dividend, recapitalization, exchange or similar event or otherwise, which have not been (x) included in the Registration
Statement that has been declared effective by the SEC, or (y) sold under circumstances meeting all of the applicable conditions
of Rule 144 (or any similar provision then in force) under the 1933 Act.

 

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“Registration
Statement” means the registration statement or statements of the Company filed under the 1933 Act covering the Registrable
Securities.

 

All capitalized terms
used in this Agreement and not otherwise defined herein shall have the same meaning ascribed to them as in the Investment Agreement.

 

Section 2.        REGISTRATION.

 

(a)     Subject
to Section 3(g), the Company shall, within twenty-one (21) days after the date of this Agreement, file with the SEC the
Registration Statement or Registration Statements (as is necessary) on Form S-1 (or, if such form is unavailable for such a registration,
on such other form as is available for such registration), covering the resale of all of the Registrable Securities, which Registration
Statement(s) shall state that, in accordance with Rule 416 promulgated under the 1933 Act, such Registration Statement also covers
such indeterminate number of additional shares of Common Stock as may become issuable upon stock splits, stock dividends or similar
transactions. The Company shall initially register for resale 5,000,000 shares of Common Stock, except to the extent that the
SEC requires the share amount to be reduced as a condition of effectiveness.

 

(b)     Intentionally
Omitted.

 

(c)     The
Company agrees not to include any other securities in the Registration Statement covering the Registrable Securities without the
Investor’s prior written consent which the Investor may withhold in its sole discretion. Furthermore, the Company agrees
that it will not file any other Registration Statement for other securities, until thirty calendar days after the Registration
Statement for the Registrable Securities is declared effective by the SEC.

 

Section 3.        RELATED
OBLIGATIONS. 

 

At such time as the
Company is obligated to prepare and file the Registration Statement with the SEC pursuant to Section 2(a), the Company
shall have the following obligations with respect to the Registration Statement:

 

(a)     The
Company shall use all commercially reasonable efforts to cause such Registration Statement relating to the Registrable Securities
to become effective within ninety (90) days after the date that the Registration Statement is filed and shall keep such Registration
Statement effective until the earlier to occur of the date on which (A) the Registrable Securities may be sold by the Investor
without registration by reason of Rule 144 under the 1933 Act or any successor or other rule of similar effect, (B) the Investor
shall have sold all the Registrable Securities; or (B) the Company has no right to sell any additional shares of Common Stock under
the Investment Agreement (the “Registration Period”). The Registration Statement (including any amendments or
supplements thereto and prospectuses contained therein) shall not contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading. The Company shall use all commercially reasonable efforts to respond to all SEC comments within
ten (10) business days from receipt of such comments by the Company. The Company shall use all commercially reasonable efforts
to cause the Registration Statement relating to the Registrable Securities to become effective no later than five (5) business
days after notice from the SEC that the Registration Statement may be declared effective. The Investor agrees to provide all information
which it is required by law to provide to the Company, including the intended method of disposition of the Registrable Securities,
and the Company’s obligations set forth above shall be conditioned on the receipt of such information.

 

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(b)     The
Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to the Registration
Statement and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule
424 promulgated under the 1933 Act, as may be necessary to keep such Registration Statement effective during the Registration Period,
and, during such period, comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities
of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed
of in accordance with the intended methods of disposition by the Investor thereof as set forth in such Registration Statement.
In the event the number of shares of Common Stock covered by the Registration Statement filed pursuant to this Agreement is at
any time insufficient to cover all of the Registrable Securities, the Company shall amend such Registration Statement, or file
a new Registration Statement (on the short form available therefor, if applicable), or both, so as to cover all of the Registrable
Securities, in each case, as soon as practicable, but in any event within fifty (50) calendar days after the necessity therefor
arises (based on the then Purchase Price of the Common Stock and other relevant factors on which the Company reasonably elects
to rely), assuming the Company has sufficient authorized shares at that time, and if it does not, within fifty (50) calendar days
after such shares are authorized. The Company shall use commercially reasonable efforts to cause such amendment and/or new Registration
Statement to become effective as soon as practicable following the filing thereof.

 

(c)     The
Company shall make available to the Investor whose Registrable Securities are included in any Registration Statement and its legal
counsel without charge (i) if requested by the Investor, promptly after the same is prepared and filed with the SEC at least one
(1) copy of such Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits, the prospectus included in such Registration Statement (including each preliminary
prospectus) and, with regards to such Registration Statement(s), any correspondence by or on behalf of the Company to the SEC or
the staff of the SEC and any correspondence from the SEC or the staff of the SEC to the Company or its representatives; and (ii)
upon the effectiveness of any Registration Statement, the Company shall make available copies of the prospectus, via EDGAR, included
in such Registration Statement and all amendments and supplements thereto.

 

(d)     The
Company shall use commercially reasonable efforts to (i) register and qualify the Registrable Securities covered by the Registration
Statement under such other securities or “blue sky” laws of such states in the United States as the Investor reasonably
requests; (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements
to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period;
(iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during
the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition
thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section
3(d), or (y) subject itself to general taxation in any such jurisdiction. The Company shall promptly notify the Investor who
holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration
or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction
in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such purpose.

 

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(e)     As
promptly as practicable after becoming aware of such event, the Company shall notify the Investor in writing of the happening of
any event as a result of which the prospectus included in the Registration Statement, as then in effect, includes an untrue statement
of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading (“Registration Default”) and use all
diligent efforts to promptly prepare a supplement or amendment to such Registration Statement and take any other necessary steps
to cure the Registration Default (which, if such Registration Statement is on Form S-3, may consist of a document to be filed by
the Company with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act (as defined below) and to be incorporated
by reference in the prospectus) to correct such untrue statement or omission, and make available copies of such supplement or amendment
to the Investor. The Company shall also promptly notify the Investor (i) when a prospectus or any prospectus supplement or post-effective
amendment has been filed, and when the Registration Statement or any post-effective amendment has become effective; (ii) of any
request by the SEC for amendments or supplements to the Registration Statement or related prospectus or related information, (iii)
of the Company’s reasonable determination that a post-effective amendment to the Registration Statement would be appropriate,
(iv) in the event the Registration Statement is no longer effective, or (v) if the Registration Statement is stale as a result
of the Company’s failure to timely file its financial statements or otherwise. If a Registration Default occurs during the
period commencing on the Put Notice Date and ending on the Closing Date, the Company acknowledges that its failure to cure such
a Registration Default within ten (10) business days will cause the Investor to suffer damages in an amount that will be difficult
to ascertain.

 

(f)     The
Company shall use all commercially reasonable efforts to prevent the issuance of any stop order or other suspension of effectiveness
of the Registration Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction
and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment
and to notify the Investor holding Registrable Securities being sold of the issuance of such order and the resolution thereof or
its receipt of actual notice of the initiation or threat of any proceeding concerning the effectiveness of the Registration Statement.

 

(g)     The
Company shall permit the Investor and one (1) legal counsel, designated by the Investor, to review and comment upon the Registration
Statement and all amendments and supplements thereto at least one (1) calendar day prior to their filing with the SEC. However,
any postponement of a filing of a Registration Statement or any postponement of a request for acceleration or any postponement
of the effective date or effectiveness of a Registration Statement by written request of the Investor (collectively, the "Investor's
Delay") shall not act to trigger any penalty of any kind, or any cash amount due or any in-kind amount due the Investor
from the Company under any and all agreements of any nature or kind between the Company and the Investor. The event(s) of an Investor's
Delay shall act to suspend all obligations of any kind or nature of the Company under any and all agreements of any nature or kind
between the Company and the Investor.

 

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(h)     Intentionally
Omitted.

 

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

 

(j)      The
Company shall use all commercially reasonable efforts to maintain designation and quotation of all the Registrable Securities
covered by any Registration Statement on the Principal Market. The Company shall pay all fees and expenses in connection with
satisfying its obligation under this Section 3(j).

 

(k)     Intentionally
Omitted.

 

(l)      The
Company shall provide a transfer agent for all the Registrable Securities not later than the effective date of the first Registration
Statement filed pursuant hereto.

 

(m)    If
requested by the Investor, the Company shall (i) as soon as reasonably practical incorporate in a prospectus supplement or post-effective
amendment such information as the Investor reasonably determines should be included therein relating to the sale and distribution
of Registrable Securities, including, without limitation, information with respect to the offering of the Registrable Securities
to be sold in such offering; (ii) make all required filings of such prospectus supplement or post-effective amendment as soon as
reasonably possible after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment;
and (iii) supplement or make amendments to any Registration Statement if reasonably requested by the Investor.

 

(n)     The
Company shall use all commercially reasonable efforts to cause the Registrable Securities covered by the applicable Registration
Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to facilitate
the disposition of such Registrable Securities.

 

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

 

(p)     Within
one (1) business day after the Registration Statement which includes Registrable Securities is declared effective by the SEC, the
Company shall deliver to the transfer agent for such Registrable Securities, with copies to the Investor, a written notification
that such Registration Statement has been declared effective by the SEC.

 

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Section 4.        OBLIGATIONS
OF THE INVESTOR. 

 

(a)     At
least five (5) calendar days prior to the first anticipated filing date of the Registration Statement the Company shall notify
the Investor in writing of the information the Company requires from the Investor for the Registration Statement. It shall be a
condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to the
Registrable Securities and the Investor agrees to furnish to the Company that information regarding itself, the Registrable Securities
and the intended method of disposition of the Registrable Securities as shall reasonably be required to effect the registration
of the resale of such Registrable Securities and the Investor shall execute such documents in connection with such registration
as the Company may reasonably request. The Investor covenants and agrees that, in connection with any sale of Registrable Securities
by it pursuant to the Registration Statement, it shall comply with the “Plan of Distribution” section of the then current
prospectus relating to such Registration Statement.

 

(b)     The
Investor, by its acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of any Registration Statement hereunder.

 

(c)     The
Investor agrees that, upon receipt of written notice from the Company of the happening of any event of the kind described in Section
3(f) or the first sentence of Section 3(e), the Investor will immediately discontinue disposition of Registrable Securities
pursuant to any Registration Statement(s) covering the resale of such Registrable Securities until the Investor’s receipt
of the copies of the supplemented or amended prospectus contemplated by Section 3(f) or the first sentence of Section
3(e).

 

Section 5.     EXPENSES
OF REGISTRATION. 

 

All reasonable expenses,
other than underwriting discounts and commissions and other than as set forth in the Investment Agreement, incurred in connection
with registrations including comments, filings or qualifications pursuant to Section 2 and Section 3, including,
without limitation, all registration, listing and qualifications fees, printing and accounting fees, and fees and disbursements
of counsel for the Company shall be paid by the Company.

 

Section 6.        INDEMNIFICATION.

 

In the event any Registrable
Securities are included in the Registration Statement under this Agreement:

 

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(a)     To
the fullest extent permitted by law, the Company, under this Agreement, will, and hereby does, indemnify, hold harmless and defend
the Investor, the directors, officers, partners, employees, counsel, agents, representatives of, and each Person, if any, who
controls, the Investor within the meaning of the 1933 Act or the Securities Exchange Act of 1934, as amended (the “1934
Act”) (each, an “Indemnified Person”), against any losses, claims, damages, liabilities, judgments,
fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or several (collectively,
“Claims”), incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding,
investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified
Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced
or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material
fact in the Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification
of the offering under the securities or other “blue sky” laws of any jurisdiction in which the Investor has requested
in writing that the Company register or qualify the Shares (“Blue Sky Filing”), or the omission or alleged
omission to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances
under which the statements therein were made, not misleading, (ii) any untrue statement or alleged untrue statement of a material
fact contained in the final prospectus for the offer of the Registrable Securities (as amended or supplemented, if the Company
files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the circumstances under which the statements therein were made,
not misleading, or (iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any other law, including,
without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to the Registration Statement (the matters in the foregoing clauses (i) through (iii) being, collectively,
“Violations”). Subject to the restrictions set forth in Section 6(c) the Company shall reimburse each
Indemnified Person, promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim arising
out of or based upon a Violation which is due to the inclusion in the Registration Statement of the information furnished to the
Company by any Indemnified Person expressly for use in connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto; (ii) shall not be available to the extent such Claim is based on (A) a failure of the
Investor to deliver or to cause to be delivered the prospectus made available by the Company; (B) the Indemnified Person’s
use of an incorrect prospectus despite being promptly advised in advance by the Company in writing not to use such incorrect prospectus;
(C) the manner of sale of the Registrable Securities by the Investor or of the Investor’s failure to register as a dealer
under applicable securities laws; (D) any omission of the Investor to notify the Company of any material fact that should be stated
in the Registration Statement or prospectus relating to the Investor or the manner of sale; and (E) any amounts paid in settlement
of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably
withheld. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified
Person and shall survive the resale of the Registrable Securities by the Investor pursuant to the Registration Statement; and
(iii) shall not be available to the extent the Claim arises out of the gross negligence or willful misconduct of the Indemnified
Person.

 

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(b)     In
connection with any Registration Statement in which the Investor is participating, the Investor agrees to severally and jointly
indemnify, hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company,
each of its directors, officers, employees, counsel, agents and representatives and each Person, if any, who controls the Company
within the meaning of the 1933 Act or the 1934 Act (each, an “Indemnified Party”), against any Claim or Indemnified
Damages to which any of them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified
Damages arise out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation
is due to (i) the inclusion in the Registration Statement of the written information furnished to the Company by the Investor
expressly for use in connection with such Registration Statement; (ii) a failure of the Investor to deliver or to cause to be
delivered the prospectus made available by the Company or the Investor’s use of an incorrect prospectus despite being timely
advised by the Company in writing not to use such incorrect prospectus; (iii) the Investor’s failure to register as a dealer
under applicable securities laws; (iv) the Investor’s gross negligence or willful misconduct; or (v) any omission of the
Investor to notify the Company of any material fact that should be stated in the Registration Statement or prospectus relating
to the Investor or the manner of sale; and, subject to Section 6(c), the Investor will reimburse any legal or other expenses
reasonably incurred by them in connection with investigating or defending any such Claim; provided, however, that the indemnity
agreement contained in this Section 6(b) and the agreement with respect to contribution contained in Section 7 shall
not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Investor,
which consent shall not be unreasonably delayed, conditioned or withheld. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the resale of the Registrable
Securities by the Investor pursuant to the Registration Statement.

 

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

 

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

 

Section 7.        CONTRIBUTION.

 

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

 

Section 8.        REPORTS
UNDER THE 1934 ACT. 

 

With a view to making
available to the Investor the benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the
SEC that may at any time permit the Investor to sell securities of the Company to the public without registration (“Rule
144”), provided that the Investor holds any Registrable Securities which are eligible for resale under Rule 144 and such
information is necessary in order for the Investor to sell such Securities pursuant to Rule 144, the Company agrees to:

 

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

 

(b)     file
with the SEC in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so
long as the Company remains subject to such requirements (it being understood that nothing herein shall limit the Company’s
obligations under Section 5(c) of the Investment Agreement) and the filing of such reports and other documents is required for
the applicable provisions of Rule 144; and

 

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

 

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Section 9.        NO
ASSIGNMENT OF REGISTRATION RIGHTS. 

 

This Agreement and
the rights, agreements or obligations hereunder may not be assigned, by operation of law, merger or otherwise, and without the
prior written consent of the other party hereto, and any purported assignment by a party without prior written consent of the other
party will be null and void and not binding on such other party. Subject to the preceding sentence, all of the terms, agreements,
covenants, representations, warranties and conditions of this Agreement are binding upon, and inure to the benefit of and are enforceable
by, the parties and their respective successors and assigns.

 

Section 10.      AMENDMENT
OF REGISTRATION RIGHTS. 

 

The provisions of this
Agreement may be amended only with the written consent of the Company and the Investor.

 

Section 11.     MISCELLANEOUS.

 

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

 

If to the Company:

 

INNOLOG HOLDINGS CORPORATION

4000 Legato Road, Suite
830

Fairfax, Virginia 22033

Telephone: (703) 766-1412

 

With a copy to:

Richardson & Patel
LLP

750 Third Avenue, 9th
Floor

New York, NY 10017

 

Telephone: (212) 869-7000

 

If to the Investor:

Dutchess Opportunity
Fund, II, LP

50 Commonwealth Ave,
Suite 2

Boston, MA 02116

Telephone: (617) 301-4700

 

Each party shall provide
five (5) business days prior notice to the other party of any change in address, phone number, facsimile number ore-mail address.

 

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

 

    	INHC.REGISTRATION.RIGHTS.JUNE.2012	10	 

    	 

    

 

(c)     This
Agreement and the Investment Agreement constitute the entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to
herein and therein.

 

(d)     This
Agreement and the Investment Agreement supersede all prior agreements and understandings among the parties hereto with respect
to the subject matter hereof and thereof.

 

(e)     The
headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. Whenever
required by the context of this Agreement, the singular shall include the plural and masculine shall include the feminine. This
Agreement shall not be construed as if it had been prepared by one of the parties, but rather as if all the parties had prepared
the same.

 

(f)     This
Agreement may be executed in two or more identical counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by
facsimile transmission or by e-mail delivery of a PDF format of a copy of this Agreement bearing the signature of the party so
delivering this Agreement.

 

(g)     Each
party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

(h)     In
case any provision of this Agreement is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid
or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent
possible, and the validity and enforceability of the remaining provisions of this Agreement will not in any way be affected or
impaired thereby.

 

Section 12.     DISPUTES
SUBJECT TO ARBITRATION GOVERNED BY DELAWARE LAW. 

 

All disputes arising
under this agreement shall be governed by and interpreted in accordance with the laws of the State of New York, without regard
to principles of conflict of laws. The parties to this agreement will submit all disputes arising under this agreement to arbitration
in Boston, Massachusetts before a single arbitrator of the American Arbitration Association (“AAA”). The arbitrator
shall be selected by application of the rules of the AAA, or by mutual agreement of the parties, except that such arbitrator shall
be an attorney admitted to practice law in the Commonwealth of Massachusetts. No party to this agreement will challenge the jurisdiction
or venue provisions as provided in this section. Nothing contained herein shall prevent the party from obtaining an injunction.

 

*.*.*

 

    	INHC.REGISTRATION.RIGHTS.JUNE.2012	11	 

    	 

    

 

SIGNATURE PAGE OF REGISTRATION RIGHTS AGREEMENT

 

Your signature on this
Signature Page evidences your agreement to be bound by the terms and conditions of the Investment Agreement and the Registration
Rights Agreement as of the date first written above.

 

The undersigned signatory
hereby certifies that he has read and understands the Registration Rights Agreement, and the representations made by the undersigned
in this Registration Rights Agreement are true and accurate, and agrees to be bound by its terms.

 

	 	DUTCHESS OPPORTUNITY FUND, II, LP,	 
	 	 	 
	 	By:	 	 
	 	 	Douglas H. Leighton	 
	 	 	Managing Member of:	 
	 	 	Dutchess Capital Management, II, LLC	 
	 	 	General Partner to:	 
	 	 	Dutchess Opportunity Fund, II, LP	 
	 	 	 
	 	INNOLOG HOLDINGS CORPORATION	 
	 	 	 
	 	By:	 	 
	 	William P. Danielczyk	 
	 	Executive Chairman of the Board	 
	 	Principal Executive Officer	 
	 	 	 
	 	By:	 	 
	 	Eric Wagner	 
	 	Chief Financial Officer	 

 

Signature Page to Registration Rights
AgreementAMENDMENT NUMBER TWO TO

EMPLOYMENT AGREEMENT

 

This AMENDMENT NUMBER TWO TO THE EMPLOYMENT
AGREEMENT (“Amendment”) is made and entered into this 26th day of July, 2012 by and among
SOUTHERN COMMUNITY FINANCIAL CORPORATION (the “Company”), SOUTHERN COMMUNITY BANK AND TRUST
(the “Bank”) and James Hastings (the “Executive”). The effectiveness
of this Amendment is subject to the consummation (the “Closing”) of the transactions contemplated by
the Agreement and Plan of Merger by and among the Company, Capital Bank Financial Corp. (the “Purchaser”)
and Winston 23 Corporation (“Merger Sub”), dated March 26, 2012 (the “Merger Agreement”),
and if the Closing does not occur because the Merger Agreement is terminated, this Amendment shall not become effective and will
be of no force or effect.

 

WHEREAS, the Executive is currently
employed with the Bank under an Employment Agreement dated June 4, 2008, as amended (the “Employment Agreement”),
pursuant to which he currently serves as Executive Vice President, Chief Financial Officer of the Company;

 

WHEREAS, the amendment of the Employment
Agreement is required in order to comply with Section 7.2(g) of the Merger Agreement;

 

WHEREAS, Section 8.8 of the Employment
Agreement provides that the Employment Agreement may be modified by the mutual written consent of the Company, the Bank and the
Executive;

 

WHEREAS, as a predicate to the entering
into of the Merger Agreement by Purchaser and Merger Sub and a condition to the Closing, in order to preserve the value and goodwill
of the Company and the Bank, the Merger Agreement contemplates, among other things, that the Executive shall enter into this Amendment,
which shall become effective upon the Closing;

 

WHEREAS, within fifteen days of executing
this Amendment, the Bank shall pay the Executive one hundred dollars ($100), less applicable withholdings, in connection with his
execution of this Amendment (the “Amendment Bonus”); and

 

WHEREAS, the parties to the Employment
Agreement desire to amend the Employment Agreement as provided in this Amendment.

 

NOW, THEREFORE, in consideration
of the Amendment Bonus, mutual covenants and agreements set forth below and other good and valuable consideration, including the
payment of the Merger Consideration (as defined in the Merger Agreement) in connection with the Closing with respect to shares
of Company common stock, stock options and restricted stock held by the Executive, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Employment Agreement shall be amended as follows:

 

		1.	A new Section 1.4 of the Employment Agreement is hereby
added and reads as follows:

 

“1.4 Post-Closing
Duties and Responsibilities. Notwithstanding anything in this Employment
Agreement to the contrary, following the consummation of the transactions contemplated by the Agreement and Plan of Merger by and
among Southern Community Financial Corporation, Capital Bank Financial Corp. (the “Purchaser”) and
Winston 23 Corporation (“Merger Sub”), dated March 26, 2012 (the “Merger Agreement”),
the Executive shall no longer serve as Executive Vice President, Chief Financial Officer of Southern Community Financial Corporation
and shall no longer have the duties and responsibilities associated with such position and shall instead have the position, titles,
duties and responsibilities as assigned from time to time by the Chief Executive Officer of the Purchaser or his designee following
the Closing Date (as defined in the Merger Agreement).”

 

    	 

    	 

    
 

 

2.            Section
3.2 of the Employment Agreement is hereby amended to read as follows and all references to “Good Reason” (and the
concepts and rights associated therewith) in the Employment Agreement are hereby removed from the Employment Agreement and are
no longer applicable:

 

“The Executive may terminate his employment
with written notice to the Employer 60 days in advance of the date of termination of employment.”

 

3.            Section
4.2 of the Employment Agreement is hereby amended to read as follows:

 

			“4.2 TERMINATION BY THE EXECUTIVE FOR ANY REASON. If the Executive terminates employment for any reason, the Executive
shall receive the salary to which he is entitled through the date on which his termination becomes effective and any other benefits
to which he may be entitled under the Employer’s benefit plans and policies.”

 

4.            Section
4.5 of the Employment Agreement is hereby amended to add the following sentence at the end of the section:

 

“Notwithstanding
anything set forth above, as of the Closing Date, this Section 4.5 shall only be applicable to a termination of the Executive’s
employment due to disability.”

 

5.            Section
4.6 of the Employment Agreement and all references thereto contained in the Employment Agreement are hereby deleted in their entirety.

 

6.           Section
5.1 of the Employment Agreement is hereby amended to read as follows:

 

“5.1 Change
in Control Benefits. If the Closing Date occurs during the term of this Employment Agreement, the Executive shall be
eligible to receive $249,900.00 (plus any interest that accrues at a rate equal to the annual mid-term applicable federal rate
provided for in Section 7872(f)(2)(A) of the Code for the month during which the Closing Date occurs, with such interest to accrue
from the date that is six months following the Closing Date through the date that a payment is made to the Executive) (the “Change
in Control Payment”), which, subject to the Executive’s execution and non-revocation of a waiver and release
in a form acceptable to the Employer within 30 days of the date of the Executive’s termination of employment, shall be payable
to the Executive (i) if the Executive’s employment terminates on or prior to the second anniversary of the Closing Date,
on the 60th day following the date of termination or (ii) if the Executive’s employment terminates following the
second anniversary of the Closing Date, in installments equal to the Base Salary payments paid to the Executive immediately prior
to the termination of the Executive’s employment, on each regular payroll date following the date of the Executive’s
termination of employment until the Change in Control Payment has been paid to the Executive in full; provided, however,
that in the event that the Executive resigns for any reason (other than for the reasons described in the last sentence of this
Section 5.1) during the period beginning on the Closing Date and ending on the earlier of (i) the 60th day following
the data conversion date (as determined by the Purchaser) and (ii) the date that is six months following the Closing Date (the
“Conversion Period”), the Executive shall only receive 50% of the Change in Control Payment; provided, further,
however, that in the event that the Executive’s employment is terminated by the Company for Cause at any time following a
Change in Control, the Executive shall not receive any portion of the Change in Control Payment. Notwithstanding anything to the
contrary set forth in this Section 5.1, if, during the Conversion Period, the Executive resigns his employment due to his being
transferred to a work location which is more than 30 miles from his current work location (other than any ordinary business related
travel) or if his duties and responsibilities are significantly and materially adversely changed and are no longer reasonably related
to his work experience with the Company prior to the Closing Date, such a resignation shall be deemed to be a termination of the
Executive’s employment without Cause for the purposes of this Section 5.”

 

 

    	 

    	 

    

 

		7.	Section 5.3 of the Employment Agreement is hereby amended
to read as follows:

 

“If the Executive
receives all or a portion of the payments under Section 5.1, he shall not be entitled to any benefits under Article 4 of this Employment
Agreement, other than salary earned through the date on which the Executive’s employment terminates.  With
the exception of: (i) amounts payable pursuant to the Amended Salary Continuation Agreement to which the Executive and the Bank
are party; and (ii) vested amounts credited to the Executive’s account(s) under the Bank’s 401(k) Plan, the Executive
shall not be eligible to receive any severance, retention or change in control payments or benefits, whether under this Employment
Agreement or pursuant to any other agreement, plan, policy or arrangement maintained by Southern Community Financial Corporation,
the Bank or any of their affiliates, and the Executive hereby agrees that he has no entitlement to any additional amounts under
any such agreement, plan, policy or arrangement other than his rights under the Salary Continuation Agreement between the Executive
and the Bank, as amended as provided under the Merger Agreement.”

 

		8.	Section 7.4 of the Employment Agreement is hereby amended
to read as follows:

 

“7.4 Article
7 Survives Termination. The rights and obligations set forth in this Article
7 shall survive termination of this Employment Agreement and of the Executive’s employment for any reason. However, the portions
of Section 7.2 of this Employment Agreement relating to competition (and not to non-solicitation of customers, which shall survive)
shall become null and void upon any termination of the Executive’s employment following a Change in Control.”

 

		9.	Section 8.1(a) of the Employment Agreement is hereby amended to read as follows:

 

“This Employment Agreement is Binding on the
Employer’s Successors. This Employment Agreement shall be binding upon the Employer and any successor to the Employer,
including any persons acquiring directly or indirectly all or substantially all of the business or assets of the Employer by purchase,
merger, consolidation, reorganization, or otherwise. But this Employment Agreement and the Employer’s obligations under this
Employment Agreement are not otherwise assignable, transferable, or delegable by the Employer. By agreement in form and substance
satisfactory to the Executive, the Employer shall require any successor to all or substantially all of the business or assets of
the Employer to expressly assume and agree to perform this Employment Agreement, as amended, in the same manner and to the same
extent the Employer would be required to perform if no such succession had occurred, taking into account and giving effect to any
amendments relating to such succession.”

 

		10.	Section 8.9 of the Employment Agreement is hereby amended
to read as follows:

 

    	 

    	 

    
 

 

“8.9 Payment
of Legal Fees. The Employer agrees to pay, to the full extent permitted by law, all legal fees and expenses which the
Executive may reasonably incur as a result of any contest by the Executive to enforce any payment provision under this Employment
Agreement, if the Executive prevails in all material respects up to a maximum aggregate amount of $200,000. Notwithstanding anything
in this Section 8.9 to the contrary, the Employer shall not be required to pay or reimburse the Executive’s legal expenses
if doing so would violate Section 18(k) of the Federal Deposit Insurance Act [12 U.S.C. 1828(k)] and Rule 359.3 of the Federal
Deposit Insurance Corporation [12 CFR 359.3].”

 

		11.	A new Section 8.12 is hereby added and reads as follows:

 

“8.12 Prohibition
on Payment. The Executive and the Employer agree that none of the Employers nor their affiliates shall make any payments
or provide any benefits otherwise due under this Employment Agreement if such payments or benefits are prohibited by applicable
legal and/or regulatory requirements or guidance or any changes in applicable law, rules or regulations or in the formal and conclusive
interpretation thereof by any regulator or agency of competent jurisdiction, including, but not limited to, with respect to the
“golden parachute rules” pursuant to Part 359 of the Regulations of the Federal Deposit Insurance Corporation [12 CFR
359].”

 

12.          This
Amendment may be executed in counterparts, each of which shall be an original, with the same effect as if the signatures affixed
thereto were upon the same instrument.

 

13.          None of the Purchaser, the Company,
the Bank nor any of their respective affiliates shall be required to incur any additional compensation expense in connection with
this Amendment due to the application of Section 409A of the Internal Revenue Code of 1986, as amended.

 

14.          The parties to this Amendment have
read this Amendment, understand it and voluntarily accept its terms and the parties agree that there shall not be strict interpretation
against either party in connection with any review of this Amendment in which interpretation thereof is an issue. The Executive
further acknowledges that: (i) this Amendment is executed voluntarily and without any duress or undue influence on the part or
behalf of the Company, the Bank or any of their respective affiliates; (ii) this entire Amendment is written in a manner calculated
to be understood by him; (iii) he has been advised by the Bank to seek the advice of legal counsel before entering into this Amendment;
(iv) the Executive has been provided with a reasonable period of time to consider the terms and conditions of this Amendment; (v)
the Executive is fully aware of the legal and binding effect of this Amendment; and (vi) to the extent he executes this Amendment
he does so knowingly and voluntarily and only after consulting his attorney or affirmatively waiving his right to consult with
his attorney. In addition, the Executive acknowledges and agrees that he has had the assistance of counsel of his choosing in the
negotiation of this Amendment, including with respect to tax matters, or he has chosen not to have the assistance of counsel.

 

15.          This Amendment shall be governed
by and construed in accordance with the laws of the State of North Carolina.

 

16.          Except as amended hereby, the Employment
Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects by the parties to the Employment
Agreement.

 

IN WITNESS WHEREOF, this Amendment
has been duly executed as of the day and year first set forth above.

 

 

    	 

    	 

    

 

 

	 	 	 	 
	Executive	 	Southern Community Financial Corporation
	 	 	 	 
	 	 	 	 
	 	 	 	 
	/s/ James Hastings	 	By:	/s/ William G. Ward, MD
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	Southern Community Bank and Trust
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	By:	/s/ William G. Ward, MD

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