Document:

REGISTRATION
RIGHTS AGREEMENT

     

    This
Registration Rights Agreement (this "Agreement") is made and
entered into as of January __, 2011 by and among American Standard Energy Corp.,
a Delaware corporation (the "Company"), and the several
purchasers signatory hereto (each a "Purchaser" and collectively,
the "Purchasers").

     

    This
Agreement is made pursuant to the Securities Purchase Agreement, dated January
__, 2011 between the Company and each Purchaser (the "Purchase
Agreement").

     

    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 each of the Purchasers agree as
follows:

     

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

     

    "Advice" has the meaning set
forth in Section 6(d).

     

    "Agreement" has the meaning
set forth in the Preamble.

     

    "Company" has the meaning set
forth in the Preamble.

     

    "Effective Date" means the
date that the Registration Statement filed pursuant to Section 2(a) is first
declared effective by the Commission.

     

    "Effectiveness Deadline"
means, with respect to the Initial Registration Statement or the New
Registration Statement, the one-hundred twentieth (120th) calendar day following
the Closing Date (or, in the event the Commission reviews and has written
comments to the Initial Registration Statement or the New Registration
Statement, the one hundred fiftieth (150th) calendar day following the Closing
Date); provided, however, that if the Company
is notified by the Commission that the Initial Registration Statement or the New
Registration Statement will not be reviewed or is no longer subject to further
review and comments, the Effectiveness Deadline as to such Registration
Statement shall be the fifth (5th) Trading Day following the date on which the
Company is so notified if such date precedes the dates otherwise required above;
provided, further, that if the
Effectiveness Deadline falls on a Saturday, Sunday or other day that the
Commission is closed for business, the Effectiveness Deadline shall be extended
to the next Business Day on which the Commission is open for
business.

     

    "Effectiveness Period" has the
meaning set forth in Section 2(b).

     

    "Event" has the meaning set
forth in Section 2(c).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    "Event Date" has the meaning
set forth in Section 2(c).

     

    "Filing Deadline" means, with
respect to the Initial Registration Statement required to be filed pursuant to
Section 2(a), the thirtieth
(30th) calendar day following the Closing Date, provided, however, that if the Filing
Deadline falls on a Saturday, Sunday or other day that the Commission is closed
for business, the Filing Deadline shall be extended to the next business day on
which the Commission is open for business.

     

    "FINRA" has the meaning set
forth in Section 3(i).

     

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

     

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

     

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

     

    "Initial Registration
Statement" has the meaning set forth in Section 2(a).

     

    "Liquidated Damages" has the
meaning set forth in Section 2(c).

     

    "Losses" has the meaning set
forth in Section 5(a).

     

    "New Registration Statement"
has the meaning set forth in Section 2(a).

     

    "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.

     

    "Purchase Agreement" has the
meaning set forth in the Recitals.

     

    "Purchaser" or "Purchasers" has the meaning
set forth in the Preamble.

    
      
         

      

      
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    "Registrable Securities" means
all of (i) the Shares, (ii) the Warrant Shares and (iii) any
securities issued or issuable upon any stock split, dividend or other
distribution, recapitalization or similar event with respect to the foregoing,
provided, that the
Holder has completed and delivered to the Company a Selling Stockholder
Questionnaire and provided to the Company any
other information regarding the Holder and the distribution of the Registrable
Securities as the Company may, from time to time, reasonably require for
inclusion in a Registration Statement pursuant to applicable law; and provided, further, that with respect to
a particular Holder, such Holder's Shares and Warrant Shares shall cease to be
Registrable Securities upon the earliest to occur of the following: (A) a
sale pursuant to a Registration Statement or Rule 144 under the Securities
Act (in which case, only such security sold by the Holder shall cease to be a
Registrable Security); or (B) becoming eligible for resale by the Holder
under Rule 144 without the requirement for the Company to be in compliance
with the current public information required thereunder and without volume or
manner-of-sale restrictions, pursuant to a written opinion letter to such
effect, addressed, delivered and acceptable to the Transfer Agent.

     

    "Registration Statements"
means any one or more registration statements of the Company filed under the
Securities Act that covers the resale of any of the Registrable Securities
pursuant to the provisions of this Agreement (including without limitation the
Initial Registration Statement, the New Registration Statement and any Remainder
Registration Statements), amendments and supplements to such Registration
Statements, including post-effective amendments, all exhibits and all material
incorporated by reference or deemed to be incorporated by reference in such
Registration Statements.

     

    "Remainder Registration
Statement" has the meaning set forth in Section 2(a).

     

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

     

    "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
effect as such Rule.

     

    "SEC Guidance" means
(i) any publicly-available written or oral guidance, comments, requirements
or requests of the Commission staff and (ii) the Securities
Act.

     

    "Selling Stockholder
Questionnaire" means a questionnaire in the form attached as Annex B hereto,
or such other form of questionnaire as may reasonably be adopted by the Company
from time to time.

     

    “Series A Warrants” means the
Series A Warrants issued to the Purchasers pursuant to the Purchase
Agreement.

     

    “Series B Warrants” means the
Series B Warrants issued to the Purchasers pursuant to the Purchase
Agreement.

     

    “Series A Warrant Shares”
means the shares of Common Stock issuable to the Purchasers pursuant to
the exercise of the Series A Warrants.

    
      
         

      

      
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    “Series B Warrant Shares” means the shares of
Common Stock issuable to the Purchasers pursuant to the exercise of the Series B
Warrants.

     

    "Shares" means the shares of
Common Stock issued or issuable to the Purchasers pursuant to the Purchase
Agreement.

     

    "Warrants" means,
collectively, the Series A Warrants and the Series B Warrants issued pursuant to
the Purchase Agreement.

     

    "Warrant Shares" means,
collectively, the Series A Warrant Shares and the Series B Warrant Shares issued
or issuable upon exercise of the Warrants.

     

    2.           Registration.

     

    (a)           On
or prior to the Filing Deadline, the Company shall prepare and file with the
Commission a Registration Statement covering the resale of all of the
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 or, if Rule 415 is not available for offers and sales of
the Registrable Securities, by such other means of distribution of Registrable
Securities as the Holders may reasonably specify (the "Initial Registration
Statement").  The Initial Registration Statement shall be on
Form S-3 (except if the Company is then ineligible to register for resale
the Registrable Securities on Form S-3, in which case such registration
shall be on such other form available to register for resale the Registrable
Securities as a secondary offering) subject to the provisions of Section 2(e) and 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" section attached hereto as Annex A (which
may be modified to respond to comments, if any, provided by the Commission or
to reflect any non-material changes).  Notwithstanding the
registration obligations set forth in this Section 2, if the Commission
informs the Company that all of the Registrable Securities cannot, as a result
of the application of Rule 415, be registered for resale as a secondary
offering on a single registration statement, the Company agrees to promptly
(i) inform each of the holders thereof and use its commercially reasonable
efforts to file amendments to the Initial Registration Statement as required by
the Commission and/or (ii) withdraw the Initial Registration Statement and
file a new registration statement (a "New Registration Statement"),
in either case covering the maximum number of Registrable Securities permitted
to be registered by the Commission, on Form S-3 or such other form
available to register for resale the Registrable Securities as a secondary
offering. Notwithstanding any other provision of this Agreement and subject to
the payment of Liquidated Damages in Section 2(c), if applicable,
if the Commission or any SEC Guidance sets forth a limitation of the number of
Registrable Securities permitted to be registered on a particular Registration
Statement as a secondary offering, unless otherwise directed in writing by a
Holder as to its Registrable Securities, the number of Registrable Securities to
be registered on such Registration Statement will first be reduced by
Registrable Securities represented by holders of Warrant Shares (applied, in the
case that some Warrant Shares may be registered, to the Holders on a pro rata
basis based on the total number of unregistered Warrant Shares held by such
Holders) and second by Registrable Securities represented by Shares (applied, in
the case that some Shares may be registered, to the Holders on a pro rata basis
based on the total number of unregistered Shares held by such Holders, subject
to a determination by the Commission that certain Holders must be reduced first
based on the number of Shares held by such Holders).  If the Company
amends the Initial Registration Statement or files a New Registration Statement,
as the case may be, under clauses (i) or (ii) above, the Company will use its
commercially reasonable efforts to file with the Commission, as promptly as
allowed by the Commission or SEC Guidance provided to the Company, one
or more registration statements on Form S-3 or such other form available to
register for resale those Registrable Securities that were not registered for
resale on the Initial Registration Statement, as amended, or the New
Registration Statement (the "Remainder Registration
Statements").

    
      
         

      

      
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    (b)           The
Company shall use its commercially reasonable efforts to cause each Registration
Statement to be declared effective by the Commission as soon as practicable and,
with respect to the Initial Registration Statement or the New Registration
Statement, as applicable, no later than the Effectiveness Deadline (including
filing with the Commission a request for acceleration of effectiveness in
accordance with Rule 461 promulgated under the Securities Act), and shall
use its commercially reasonable efforts to keep each Registration Statement
continuously effective under the Securities Act until the earliest of
(i) such time as all of the Registrable Securities covered by such
Registration Statement have been sold by the Holders; (ii) the date that
all the Shares, the Warrant Shares and any securities issued or issuable upon
any stock split, dividend or other distribution, recapitalization or similar
event with respect to the foregoing cease to be Registrable Securities; and
(iii) the first anniversary of the Closing Date (provided, however, that such one-year
period will be extended for a period of time equal to the period any Purchaser
is required to suspend sales of such Registrable Securities pursuant to the
terms of this Agreement) (the "Effectiveness
Period").  The Company shall promptly notify the Holders via
facsimile or electronic mail of a ".pdf" format data file of the effectiveness
of a Registration Statement on the same Trading Day that the Company
telephonically confirms effectiveness with the Commission.  The
Company shall, by 9:30 A.M.  New York City time on the first Trading
Day after the Effective Date, file a final Prospectus with the Commission, as
required by Rule 424(b).  Failure to so notify the Holders on or
before the second Trading Day after such notification of effectiveness or
failure to file a final Prospectus as aforesaid shall be deemed an Event under
Section 2(c).

    
      
         

      

      
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    (c)           Subject
to the provisions of Sections 3(a), 3(h) and 3(i), if (i) the
Initial Registration Statement is not filed with the Commission on or prior to
the Filing Deadline, (ii) the Initial Registration Statement or the New
Registration Statement, as applicable, is not declared effective by the
Commission (or otherwise does not become effective) for any reason on or prior
to the Effectiveness Deadline or (iii) after its Effective Date,
(A) such Registration Statement ceases for any reason (including without
limitation by reason of a stop order, or the Company's failure to update the
Registration Statement), to remain continuously effective as to all Registrable
Securities included in such Registration Statement for more than twenty (20)
consecutive calendar days or more than an aggregate of thirty (30) calendar days
(which need not be consecutive calendar days) during any 12-month period, or
(B) the Holders are not permitted to utilize the Prospectus therein to
resell such Registrable Securities for any reason for more than an aggregate of
thirty (30) consecutive calendar days (or forty-five (45) consecutive calendar
days if the Company receives comments on its Annual Report on Form 10-K for
the year ended December 31, 2010) or sixty (60) calendar days (which need
not be consecutive days) during any twelve (12) month period,  (any
such failure or breach in clauses (i) through (iii) above being referred to
as an "Event," and, for
purposes of clauses (i) or (ii), the date on which such Event occurs, or for
purposes of clause (iii), the date on which such thirty (30), forty-five (45) or
sixty (60) calendar day period is exceeded, being referred to as an "Event Date"), then on each
monthly anniversary of each such Event Date (if the applicable Event shall not
have been cured by such date) until the earlier of (1) the applicable Event
is cured and (2) the Registrable Securities are eligible for resale
pursuant to Rule 144 without manner of sale or volume restrictions, the
Company shall pay to each Holder an amount in the Company’s common stock, as
liquidated damages and not as a penalty ("Liquidated Damages"), equal
to one percent (1.0%) of the aggregate purchase price paid by such Holder
pursuant to the Purchase Agreement for any unregistered Registrable Securities
then held by such Holder (which remedy shall be exclusive of any other remedies
available under this Agreement or under applicable law).  The parties
agree that (1)  notwithstanding anything to the contrary herein or in the
Purchase Agreement, no Liquidated Damages shall be payable with respect to any
period after the expiration of the Effectiveness Period (except in respect of an
Event described in Section 2(c)(iv) herein), (it
being understood that this sentence shall not relieve the Company of any
Liquidated Damages accruing prior to the Effectiveness Deadline) and (2) in no
event shall the Company be liable in any thirty (30) day period for Liquidated
Damages under this Agreement in excess of six percent (6.0%) of the aggregate
purchase price paid by the Holders pursuant to the Purchase Agreement, except in
the case of a payment made on an Event Date and the monthly anniversary of such
Event Date.  If the Company fails to pay any Liquidated Damages
pursuant to this Section 2(c) in full within
ten (10) Business Days after the date payable, the Company will pay simple
interest thereon at a rate of fifteen percent (15.0%) per year (or such lesser
maximum amount that is permitted to be paid by applicable law) to the Holder,
accruing daily from the date such Liquidated Damages are due until such amounts,
plus all such interest thereon, are paid in full.  The 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, except in the case of the
first Event Date.  The Company shall not be liable for Liquidated
Damages under this Agreement as to any Registrable Securities which are not
permitted by the Commission to be included in a Registration Statement due
solely to SEC Guidance from the time that it is determined that such Registrable
Securities are not permitted to be registered until such time as the provisions
of this Agreement as to the Remainder Registration Statements required to be
filed hereunder are triggered, in which case the provisions of this Section 2(c) shall once again
apply, if applicable.  In such case, the Liquidated Damages shall be
calculated to only apply to the percentage of Registrable Securities which are
permitted in accordance with SEC Guidance to be included in such Registration
Statement.  The Effectiveness Deadline for a Registration Statement
shall be extended without default or Liquidated Damages hereunder in the event
that the Company's failure to obtain the effectiveness of the Registration
Statement on a timely basis results from the failure of a Purchaser to timely
provide the Company with information requested by the Company and necessary to
complete the Registration Statement in accordance with the requirements of the
Securities Act (in which the Effectiveness Deadline would be extended with
respect to Registrable Securities held by such Purchaser).

    
      
         

      

      
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    (d)           Each
Holder agrees to furnish to the Company a completed Selling Stockholder
Questionnaire not more than three (3) Trading Days following the date of this
Agreement.  At least five (5) Trading Days prior to the first
anticipated filing date of a Registration Statement for any registration under
this Agreement, the Company will notify each Holder of the information the
Company requires from that Holder other than the information contained in the
Selling Stockholder Questionnaire, if any, which shall be completed and
delivered to the Company promptly upon request and, in any event, within three
(3) Trading Days prior to the applicable anticipated filing
date.  Each Holder further agrees that it shall not be entitled to be
named as a selling securityholder in the Registration Statement or use the
Prospectus for offers and resales of Registrable Securities at any time, unless
such Holder has returned to the Company a completed and signed Selling
Stockholder Questionnaire and a response to any reasonable requests for further
information as described in the previous sentence.  If a Holder of
Registrable Securities returns a Selling Stockholder Questionnaire or a request
for further information, in either case, after its respective deadline, the
Company shall use its commercially reasonable efforts to take such actions as
are required to name such Holder as a selling security holder in the
Registration Statement or any pre-effective or post-effective amendment thereto
and to include (to the extent not theretofore included) in the Registration
Statement the Registrable Securities identified in such late Selling Stockholder
Questionnaire or request for further information, provided, however, that the Company
shall not be obligated to file more than one post-effective amendment or
supplement in any 60-day period following the date such Registration Statement
is declared effective for the purpose of naming Holders as selling
securityholders who are not named in such Registration Statement at the time of
effectiveness. Each Holder acknowledges and agrees that the information in the
Selling Stockholder Questionnaire or request for further information as
described in this Section 2(d) will be used by
the Company in the preparation of the Registration Statement and hereby consents
to the inclusion of such information in the Registration Statement.

     

    (e)           If
Form S-3 is not  available for the registration of the resale of
Registrable Securities hereunder, the Company shall (i) register the resale
of the Registrable Securities on another appropriate form and
(ii) undertake to register the Registrable Securities on Form S-3
promptly after such form is available, provided that the Company
shall maintain the effectiveness of the Registration Statement then in effect
until such time as a Registration Statement on Form S-3 covering the
Registrable Securities has been declared effective by the
Commission.  The Holders acknowledge that as of the Closing Date and
at the time of the Filing Deadline the Company will not be eligible to use a
Form S-3 to register the resale of the Registrable Securities.

     

    3.          Registration
Procedures

     

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

     

    (a)           Not
less than two (2) Trading Days prior to the filing of each Registration
Statement and not less than one (1) Trading Day prior to the filing of any
related Prospectus or any amendment or supplement thereto (except for Annual
Reports on Form 10-K (including portions of the Company's Proxy Statement
for its Annual Meetings of Stockholders to the extent specifically incorporated
by reference into such Annual Reports on Form 10-K), Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K and any similar or successor
reports or any prospectus supplement the substance of which is limited to any of
the foregoing filings), (i) furnish to the Holder copies of such
Registration Statement, Prospectus or amendment or supplement thereto, as
proposed to be filed, which documents will be subject to the review of such
Holder (it being acknowledged and agreed that if a Holder does not object to or
comment on the aforementioned documents within such two (2) Trading Day or one
(1) Trading Day period, as the case may be, then the Holder shall be deemed to
have consented to and approved the use of such documents) and (ii) use
commercially reasonable efforts to cause its officers and directors, counsel and
independent registered public accountants to respond to such inquiries as shall
be necessary, in the reasonable opinion of respective counsel to each Holder, to
conduct a reasonable investigation within the meaning of the Securities
Act.  The Company shall not file any Registration Statement or
amendment or supplement thereto in a form to which a Holder reasonably objects
in good faith, provided
that, the Company is notified of such objection in writing within the two (2)
Trading Day or one (1) Trading Day period described above, as applicable, and
for such period as the Company and such Holder are attempting in good faith to
resolve the objection of such Holder, any time period or deadline for purposes
of Section 2(c) shall be
extended for such period and no Liquidated Damages shall accrue or be payable
for such period.

    
      
         

      

      
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    (b)           (i) Prepare
and file with the Commission such amendments (including post effective
amendments) and supplements, to each Registration Statement and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement continuously effective as to the applicable Registrable Securities for
its Effectiveness Period; (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 practicable to any
comments received from the Commission with respect to each 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 such Registration Statement that pertains to the
Holders as "Selling Stockholders" but not any other comments or any comments
that would result in the disclosure to the Holders of material and non-public
information concerning the Company; and (iv) comply 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 (subject to the terms of this Agreement) in accordance with
the intended methods of disposition by the Holders thereof as set forth in such
Registration Statement as so amended or in such Prospectus as so supplemented;
provided, however, that each Purchaser
shall be responsible for the delivery of the Prospectus, if required, to the
Persons to whom such Purchaser sells any of the Shares or the Warrant Shares
(including in accordance with Rule 172 under the Securities Act), and each
Purchaser agrees to dispose of Registrable Securities in compliance with the
"Plan of Distribution" described in the Registration Statement and otherwise in
compliance with applicable federal and state securities laws. In the case of
amendments and supplements to a Registration Statement which are required to be
filed pursuant to this Agreement (including pursuant to this Section 3(b)) by reason of
the Company filing a report on Form 10-K, Form 10-Q or Form 8-K
or any analogous report under the Exchange Act, the Company shall have
incorporated such report by reference into such Registration Statement, if
applicable, or shall file such amendments or supplements with the Commission on
the same day on which the Exchange Act report which created the requirement for
the Company to amend or supplement such Registration Statement was
filed.

    
      
         

      

      
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    (c)           Notify
the Holders (which notice shall, pursuant to clauses (iii) 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 practicable (and, in
the case of (i)(A) below, not less than one (1) Trading Day prior to such
filing): (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 any Registration Statement (in which case the Company shall provide
to each of the Holders true and complete copies of all comments that pertain to
the Holders as a "Selling Stockholder" or to the "Plan of Distribution" and all
written responses thereto, but not any other comments or responses or
information that the Company believes would constitute material and non-public
information); and (C) with respect to each 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 that pertains to the Holders as "Selling Stockholders" or
the "Plan of Distribution"; (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 such Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires any revisions to such Registration Statement, Prospectus or other
documents so that, in the case of such Registration Statement or 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 the case of any Prospectus, form of prospectus
or supplement thereto, 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
believes may be 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, any and all
such information shall remain confidential to each Holder until such information
otherwise becomes public, unless disclosure by a Holder is required by law; and
provided, further, that notwithstanding
each Holder's agreement to keep such information confidential, each such Holder
makes no acknowledgement that any such information is material, non-public
information.

     

    (d)           Use
commercially reasonable efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order 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, as soon as practicable.

     

    (e)           If
requested by a Holder, furnish to such Holder, without charge, at least one
conformed copy of each Registration Statement and each amendment thereto 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; provided, that the Company
shall have no obligation to provide any document pursuant to this clause that is
available on the Commission's EDGAR system; provided further, that the Company
shall have no obligation to provide an unredacted form of any exhibit if the
Company has filed or the Commission has granted a confidential treatment request
with respect to such exhibit.

    
      
         

      

      
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    (f)           Prior
to any resale of Registrable Securities by a Holder, use its commercially
reasonable 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 by
the Holder 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.

     

    (g)           If
requested by a Holder, cooperate with such Holder to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to (i) the Holder upon effectiveness of a Registration
Statement covering the resales of the Shares or (ii) a transferee pursuant
to transfers made pursuant to the Registration Statement, which certificates
shall be free, to the extent permitted by the Purchase Agreement and the
Warrants and under law, 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 reasonably request.

     

    (h)           Following
the occurrence of any event contemplated by Section 3(c), as promptly as
reasonably practicable (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 the affected Registration Statements 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, no Registration Statement nor any 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 the case of
any Prospectus, form of prospectus or supplement thereto, in light of the
circumstances under which they were made), not misleading.  If the
Company notifies the Holders in accordance with clauses (iii) through (vi) of
Section 3(c) above 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 commercially reasonable 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 3(h) to suspend the
availability of a Registration statement and Prospectus, without the payment of
partial Liquidated Damages otherwise required pursuant to Section 2(c), for periods not
to exceed the time periods set forth in Section 2(c)(iii)(B).

    
      
         

      

      
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    (i)           The
Company may require each selling Holder to furnish to the Company a certified
statement as to (i) the number of shares of Common Stock beneficially owned
by such Holder and any Affiliate thereof, (ii) any Financial Industry
Regulatory Authority ("FINRA") affiliations,
(iii) any natural persons who have the power to vote or dispose of the
common stock and (iv) any other information as may be requested by the
Commission, FINRA or any state securities commission.  During any
periods that the Company is unable to meet its obligations hereunder with
respect to the registration of Registrable Securities because any Holder fails
to furnish such information within three (3) 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.

     

    (j)           Neither
the Company nor any subsidiary or affiliate thereof shall identify any Purchaser
as an underwriter in any public disclosure or filing with the Commission or any
Trading Market  and any Purchaser being deemed an underwriter by the
Commission shall not relieve the Company of any obligations it has under this
Agreement or any other Transaction Document; provided, however, that the
foregoing shall not prohibit the Company from including the disclosure found in
the "Plan of Distribution" section attached hereto in the Registration
Statement, provided, further, if any
Purchaser is required to be identified as an underwriter by the Commission or
the Trading Market, prior to the Company so naming such Purchaser, the Company
shall promptly notify such Purchaser and such Purchaser shall be entitled to
either (i) agree to be so named, or (ii) withdraw as a selling stockholder with
respect to the applicable Registration Statement.  If any such
Purchaser refuses to be so named as an underwriter or to withdraw from the
applicable Registration Statement, such Purchaser shall not be entitled to any
Liquidated Damages or to recover from the Company any other damages or losses
caused by such refusal.

     

    4.           Registration
Expenses.  All fees and expenses incident to the Company's
performance of or compliance with its obligations under this Agreement
(excluding any underwriting discounts and selling commissions and all legal fees
and expenses of legal counsel for any Holder) 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 any Trading Market on which the Common Stock is
then listed for trading and (B) with respect to compliance with applicable state
securities or Blue Sky laws (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 Holder), (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities), (iii) messenger, telephone and delivery expenses
incurred by the Company, (iv) fees and disbursements of counsel for the
Company, and (v) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement.  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 underwriting, broker or similar fees or
commissions of any Holder or any legal fees or other costs of the
Holders.

    
      
         

      

      
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    5.           Indemnification.

     

    (a)           Indemnification by the
Company.  The Company shall, notwithstanding any termination of
this Agreement, indemnify, defend and hold harmless each Holder, the officers,
directors, agents, partners, members, managers, stockholders, Affiliates and
employees 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, partners, members, managers,
stockholders, agents and employees of each such controlling Person, to the
fullest extent permitted by applicable law, from and against any and all losses,
claims, expenses, damages, liabilities and costs (including, without limitation,
reasonable costs of preparation and investigation and reasonable attorneys'
fees, all of which shall be payable quarterly in arrears as they are incurred)
(collectively, "Losses"), that arise out of
or are based upon (i) any untrue or alleged 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 out of or relating to any omission or alleged omission to
state 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 (ii) any violation or alleged violation by the Company
of the Securities Act, 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
(A) such untrue statements, alleged untrue statements, omissions or alleged
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 approved
in writing by such Holder expressly for use in the Registration Statement, such
Prospectus or such form of Prospectus or in any amendment or supplement thereto
(it being understood that each Holder has approved Annex A hereto
for this purpose) or (B) in the case of an occurrence of an event of the
type specified in Section 3(c)(iii)-(vi), related
to the use by a Holder of an outdated or defective Prospectus after the Company
has notified such Holder that the Prospectus is outdated or defective and prior
to the receipt by such Holder of the Advice contemplated and defined in Section 6(d) below, to the
extent that following the receipt of the Advice the misstatement or omission
giving rise to such Loss would have been corrected or (C) to the extent
that any such Losses arise out of the Purchaser's (or any other indemnified
Person's) failure to send or give a copy of the Prospectus or supplement (as
then amended or supplemented), if required, pursuant to Rule 172 under the
Securities Act (or any successor rule) to the Persons asserting an untrue
statement or alleged untrue statement or omission or alleged omission at or
prior to the written confirmation of the sale of Registrable Securities to such
Person if such statement or omission was corrected in such Prospectus or
supplement.  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.  Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of an Indemnified Party (as
defined in Section 5(c)) and shall
survive the transfer of the Registrable Securities by the
Holders.

    
      
         

      

      
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    (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 (all
of which shall be payable quarterly in arrears as they are incurred), as
incurred, arising out of or are based upon any untrue or alleged 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 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 any
form of prospectus or supplement thereto, in light of the circumstances under
which they were made) not misleading (A) to the extent that 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
(B) 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 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 (C) in the case of an occurrence of an
event of the type specified in Section 3(c)(iii)-(vi), to the
extent related to 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 6(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.

     

    (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 reasonable 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, unless such
failure materially prejudices 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 have been advised by counsel that, in the
reasonable judgment of such counsel, representation of both parties by the same
counsel would be inappropriate under the applicable rules of professional
responsibility (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 such counsel shall be at the expense of
the Indemnifying Party); provided, that the
Indemnifying Party shall not be liable for the fees and expenses of more than
one separate firm of attorneys at any time for all Indemnified
Parties.  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 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.

    
      
         

      

      
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    Subject
to the terms of this Agreement, all 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 5) shall be paid to
the Indemnified Party, quarterly in arrears as they are incurred; 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 such
Indemnified Party is finally judicially determined to not be entitled to
indemnification hereunder).

     

    (d)           Contribution.  If
a claim for indemnification under Section 5(a) or 5(b) is unavailable
to an Indemnified Party or insufficient to hold an Indemnified Party harmless
for any Losses, then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, 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 5 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), (A) no
Holder shall be required to contribute, in the aggregate, any amount in excess
of the amount by which the net proceeds actually received by such Holder from
the sale of the Registrable Securities subject to the Proceeding exceeds the
amount of any damages that such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission and (B) no contribution will be made under circumstances where the
maker of such contribution would not have been required to indemnify the
Indemnified Party under the fault standards set forth in this Section 5.  No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent
misrepresentation.

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

     

    The
indemnity and contribution agreements contained in this Section 5 are in addition to
any liability that the Indemnifying Parties may have to the Indemnified
Parties.

     

    6.           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
Registrations; Prohibition on Filing Other Registration
Statements.  Except and to the extent specified in the
Schedules to the Purchase Agreement, 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 a Registration Statement other than the Registrable
Securities and the Company shall not prior to the Effective Date enter into any
agreement providing any such right to any of its security
holders.  The Company shall not file with the Commission a
registration statement relating to an offering for its own account under the
Securities Act of any of its equity securities other than a registration
statement on Form S-8 or in connection with an acquisition, on Form S-4
until the earlier of (i) the date that is thirty (30) days after the
Initial Registration Statement or New Registration Statement, as the case may
be, is declared effective and (ii) the date that all Registrable Securities
are eligible for resale by non-affiliates without volume or manner of sale
restrictions under Rule 144 and without the requirement for the company to
be in compliance with the current public information requirements under
Rule 144. For the avoidance of doubt, the Company shall not be prohibited
from filing amendments to registration statements filed prior to the date of
this Agreement or a registration statement replacing a registration statement
filed prior to the date of this Agreement; provided that no such amendment or
replacement registration statement shall increase the number of securities
registered on a registration statement so previously 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 (unless an exemption
therefrom is available) in connection with sales of Registrable Securities
pursuant to the Registration Statement and shall sell the Registrable Securities
only in accordance with a method of distribution described in the Registration
Statement

    
      
         

      

      
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    (d)           Discontinued
Disposition.  By its acquisition of Registrable Securities,
each Holder agrees that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(c)(iii)-(vi), such
Holder will forthwith discontinue disposition of such Registrable Securities
under a Registration Statement until it is advised in writing (the "Advice") by the Company that
the use of the applicable Prospectus (as it may have been supplemented or
amended) may be resumed.  The Company will use its commercially
reasonable efforts to ensure that the use of the Prospectus may be resumed as
promptly as is 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) and Section 3(h).

     

    (e)           Amendments and
Waivers.  The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, or
waived unless the same shall be in writing and signed by the Company and Holders
holding no less than two-thirds of the Registrable Securities issued and
issuable pursuant to the Securities Purchase Agreement and the Transaction
Documents on the Closing Date, provided that any party may
give a waiver as to itself.  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.

     

    (f)           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.

     

    (g)           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.  Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.  The Company may not assign its
rights or obligations hereunder (except in connection with a Fundamental
Transaction (as defined by the Warrants), provided that the Company is
in compliance with the provisions governing Fundamental Transactions set forth
in the Warrants, without the prior written consent of all the Holders of the
then outstanding Registrable Securities.  Each Holder may assign its
respective rights hereunder in the manner and to the Persons as permitted under
the Purchase Agreement; provided in each case that
(i) the Holder agrees in writing with the transferee or assignee to assign
such rights and related obligations under this Agreement, and for the transferee
or assignee to assume such obligations, and a copy of such agreement is
furnished to the Company promptly, and in any event within three Business Days,
(ii) the Company is promptly, and in any event within three Business Days,
furnished with written notice of the name and address of such transferee or
assignee and the securities with respect to which such registration rights are
being transferred or assigned, (iii) at or before the time the
effectiveness of such transfer or assignment, the transferee or assignee agrees
in writing with the Company to be bound by all of the provisions contained
herein and (iv) the transferee or assignee is an "accredited investor," as
that term is defined in Rule 501 of Regulation D.

    
      
         

      

      
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    (h)           Execution and
Counterparts.  This Agreement may be executed in two or more
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 and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart.  If any signature is delivered by facsimile
transmission or by e-mail delivery of a ".pdf" format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile or ".pdf" signature were the original thereof.

     

    (i)           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.

     

    (j)           Cumulative
Remedies.  Except as provided herein, the remedies provided
herein are cumulative and not exclusive of any other remedies provided by
law.

     

    (k)           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 good faith
reasonable efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction.  It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

     

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

     

    (m)         Independent Nature of
Purchasers' Obligations and Rights.  The obligations of each
Purchaser under this Agreement are several and not joint with the obligations of
any other Purchaser hereunder, and no Purchaser shall be responsible in any way
for the performance of the obligations of any other Purchaser
hereunder.  The decision of each Purchaser to purchase the Securities
pursuant to the Purchase Agreement has been made independently of any other
Purchaser.  Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Purchaser pursuant
hereto or thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert with
respect to such obligations or the transactions contemplated by this
Agreement.  Each Purchaser acknowledges that no other Purchaser has
acted as agent for such Purchaser in connection with making its investment
hereunder and that no Purchaser will be acting as agent of such Purchaser in
connection with monitoring its investment in the Securities or enforcing its
rights under the Transaction Documents.  Each Purchaser 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 Purchaser to be joined as an additional party in any Proceeding for such
purpose.  The Company acknowledges that each of the Purchasers has
been provided with the same Registration Rights Agreement for the purpose of
closing a transaction with multiple Purchasers and not because it was required
or requested to do so by any Purchaser.

    
      
         

      

      
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    (n)           Termination.  This
Agreement shall be automatically terminated with respect to any Holder and shall
have no force or effect with respect to such Holder upon the termination of the
Purchase Agreement with respect to such Holder (other than such Holder's
obligations under Section 5).  Nothing
in this Section 6(n) shall be deemed
to release any party from any liability for any breach by such party of the
terms and provisions of this Agreement.

     

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

    

    
      
        	
                AMERICAN
      STANDARD ENERGY CORP.

              
	 
      
	
                By: 

              	
                   

              
	 
      	
                Name:
      Scott Feldhacker

              
	 
      	
                Title:
      Chief Executive Officer

              

      

    

     

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

    

    
      
        	
                NAME
      OF INVESTING ENTITY

              
	 
      
	
                   

              
	 
      	 
      
	
                AUTHORIZED
      SIGNATORY

              
	 
      	 
      
	
                By: 

              	
                   

              
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      
	
                ADDRESS
      FOR NOTICE

              
	 
      

      

    

    
      
        	
                c/o: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                Street: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                City/State/Zip: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                Attention: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                Tel: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                Fax: 

              	
                   

              
	 
      	 
      

      

    

    
      
        	
                Email: 

              	
                   

              

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    ANNEX A

     

    PLAN OF
DISTRIBUTION

     

    We are
registering the shares of common stock issued to the selling stockholders and
issuable upon exercise of the warrants issued to the selling stockholders to
permit the resale of these shares of common stock by the holders of the shares
of common stock and warrants from time to time after the date of this
prospectus.  We will not receive any of the proceeds from the sale by
the selling stockholders of the shares of common stock.  We will bear
all fees and expenses incident to our obligation to register the offer and sale
of the shares of common stock.

     

    The
selling stockholders may sell all or a portion of the shares of common stock
beneficially owned by them and offered hereby from time to time directly or
through one or more underwriters, broker-dealers or agents.  If the
shares of common stock are sold through underwriters or broker-dealers, the
selling stockholders will be responsible for underwriting discounts or
commissions or agent's commissions.  The shares of common stock may be
sold on any national securities exchange or quotation service on which the
securities may be listed or quoted at the time of sale, in the over-the-counter
market or in transactions otherwise than on these exchanges or systems or in the
over-the-counter market and in one or more transactions at fixed prices, at
prevailing market prices at the time of the sale, at varying prices determined
at the time of sale, or at negotiated prices.  These sales may be
effected in transactions, which may involve crosses or block
transactions.  The selling stockholders 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;

            

    

     

    
      	
               
      

            	
              ·

            	
              through
      the writing or settlement of options or other hedging transactions,
      whether such options are listed on an options exchange or
      otherwise;

            

    

     

    
      	
               
      

            	
              ·

            	
              a
      combination of any such methods of sale;
and

            

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              ·

            	
              any
      other method permitted pursuant to applicable
  law.

            

    

     

    The
selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act, as
permitted by that rule, or Section 4(1) under the Securities Act, if
available, rather than under this prospectus, provided that they meet the
criteria and conform to the requirements of those provisions.

     

    Broker
dealers engaged by the selling stockholders may arrange for other broker dealers
to participate in sales.  If the selling stockholders effect such
transactions by selling shares of common stock to or through underwriters,
broker-dealers or agents, such underwriters, broker-dealers or agents may
receive commissions in the form of discounts, concessions or commissions from
the selling stockholders or commissions from purchasers of the shares of common
stock for whom they may act as agent or to whom they may sell as
principal.  Such commissions will be in amounts to be negotiated, but,
except as set forth in a supplement to this prospectus, in the case of an agency
transaction will not be in excess of a customary brokerage commission in
compliance with FINRA Rule 2440; and in the case of a principal transaction
a markup or markdown in compliance with FINRA IM-2440.

     

    In
connection with sales of the shares of common stock or otherwise, 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 shares of
common stock in the course of hedging in positions they assume.  The
selling stockholders may also sell shares of common stock short and deliver
shares of common stock covered by this prospectus to close out short positions
and to return borrowed shares in connection with such short
sales.  The selling stockholders may also loan or pledge shares of
common stock to broker-dealers that in turn may sell such shares, to the extent
permitted by applicable law.  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 may, from time to time, pledge or grant a security interest
in some or all of the warrants or shares of common stock owned by them and, if
they default in the performance of their secured obligations, the pledgees or
secured parties may offer and sell the shares of common stock from time to time
pursuant to this prospectus or any amendment to this prospectus under
Rule 424(b)(3) or other applicable provision of the Securities Act,
amending, if necessary, the list of selling stockholders to include the pledgee,
transferee or other successors in interest as selling stockholders under this
prospectus.  The selling stockholders also may transfer and donate the
shares of common stock in other circumstances in which case the transferees,
donees, pledgees or other successors in interest will be the selling beneficial
owners for purposes of this prospectus.

     

    The
selling stockholders and any broker-dealer or agents participating in the
distribution of the shares of common stock may be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act in connection
with such sales and in which case may be subject to certain statutory
liabilities under the Exchange Act.

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

     

    The
selling stockholders will be subject to the applicable prospectus delivery
requirements of the Securities Act unless subject to an exemption therefrom,
including under Rule 172 thereunder.

     

    Each
selling stockholder has informed us that it is not a registered broker-dealer
and does not have any written or oral agreement or understanding, directly or
indirectly, with any person to distribute the common stock.  Upon our
being notified in writing by a selling stockholder that any material arrangement
has been entered into with a broker-dealer for the sale of common stock through
a block trade, special offering, exchange distribution or secondary distribution
or a purchase by a broker or dealer, a supplement to this prospectus will be
filed, if required, pursuant to Rule 424(b) under the Securities Act,
disclosing (i) the name of each such selling stockholder and of the
participating broker-dealer(s), (ii) the number of shares involved,
(iii) the price at which such the shares of common stock were sold,
(iv) the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable, (v) that such broker-dealer(s) did not
conduct any investigation to verify the information set out or incorporated by
reference in this prospectus, and (vi) other facts material to the
transaction.  In no event shall any broker-dealer receive fees,
commissions and markups, which, in the aggregate, would exceed
8.0%.

     

    Under the
securities laws of some states, the shares of common stock may be sold in such
states only through registered or licensed brokers or dealers.  In
addition, in some states the shares of common stock may not be sold unless such
shares have been registered or qualified for sale in such state or an exemption
from registration or qualification is available and is complied
with.

     

    There can
be no assurance that any selling stockholder will sell any or all of the shares
of common stock registered pursuant to the registration statement, of which this
prospectus forms a part.

     

    Each
selling stockholder and any other person participating in such distribution will
be subject to applicable provisions of the Exchange Act and the rules and
regulations thereunder, including, without limitation, to the extent applicable,
Regulation M of the Exchange Act, which may limit the timing of purchases and
sales of any of the shares of common stock by the selling stockholder and any
other participating person.  To the extent applicable, Regulation M
may also restrict the ability of any person engaged in the distribution of the
shares of common stock to engage in market-making activities with respect to the
shares of common stock.  All of the foregoing may affect the
marketability of the shares of common stock and the ability of any person or
entity to engage in market-making activities with respect to the shares of
common stock.

     

    We will
pay all expenses of the registration of the shares of common stock pursuant to
the registration rights agreement, including, without limitation, SEC filing
fees and expenses of compliance with state securities or "blue sky" laws; provided, however, that each
selling stockholder will pay all underwriting discounts and selling commissions,
if any and any related legal expenses incurred by it.  We will
indemnify the selling stockholders against certain liabilities, including some
liabilities under the Securities Act, in accordance with the registration rights
agreement, or the selling stockholders will be entitled to
contribution.  We may be indemnified by the selling stockholders
against civil liabilities, including liabilities under the Securities Act, that
may arise from any written information furnished to us by the selling
stockholders specifically for use in this prospectus, in accordance with the
related registration rights agreement, or we may be entitled to
contribution.

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    ANNEX B

     

    SELLING
STOCKHOLDER NOTICE AND QUESTIONNAIRE

     

    The
undersigned holder of shares of the common stock, par value $0.001 per share of
American Standard Energy Corp. (the "Company") issued pursuant to
a certain Securities Purchase Agreement by and among the Company and the
Purchasers named therein, dated as of Janaury __, 2011 (the "Agreement"), understands that
the Company intends to file with the Securities and Exchange Commission a
registration statement on Form S-1 (the "Resale Registration
Statement") for the registration and the 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 Agreement and the
terms of the Registration Rights Agreement by and among the Company and the
Purchasers named therein, dated as of January __, 2011 (the “Registration Rights
Agreement”). All capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in either the Agreement or Registration
Rights Agreement.

     

    In order
to sell or otherwise dispose of any Registrable Securities pursuant to the
Resale Registration Statement, a holder of Registrable Securities generally will
be required to be named as a selling stockholder in the related prospectus or a
supplement thereto (as so supplemented, the "Prospectus"), deliver the
Prospectus to purchasers of Registrable Securities, if required (including
pursuant to Rule 172 under the Securities Act) and be bound by the
provisions of the Agreement (including certain indemnification provisions, as
described below).  Holders must complete and deliver
this Notice and Questionnaire in order to be named as selling stockholders in
the Prospectus.  Holders of Registrable Securities who do not
complete, execute and return this Notice and Questionnaire within three (3)
Trading Days following the date of the Agreement (1) will not be named as
selling stockholders in the Resale Registration Statement or the Prospectus and
(2) may not use the Prospectus for resales of Registrable
Securities.

     

    Certain
legal consequences arise from being named as a selling stockholder in the Resale
Registration Statement and the Prospectus.  Holders 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 stockholder in the
Resale Registration Statement and the Prospectus.

     

    NOTICE

     

    The
undersigned holder (the "Selling Stockholder") of
Registrable Securities hereby gives notice to the Company of its intention to
sell or otherwise dispose of Registrable Securities owned by it and listed below
in Item 3, unless otherwise specified in Item 3, pursuant to the Resale
Registration Statement.  The undersigned, by signing and returning
this Notice and Questionnaire, understands and agrees that it will be bound by
the terms and conditions of this Notice and Questionnaire, the Agreement and the
Registration Rights Agreement.

     

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

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    QUESTIONNAIRE

     

    
      	
              1.

            	
              Name.

            

    

     

    
      	
               
      

            	
              (a)

            	
              Full
      Legal Name of Selling Stockholder:

            

    

     

    
      
        

      

    

     

    
      	
               
      

            	
              (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
      Stockholder:

            

    

    

    
      
        
          	
                     

                
	
                     

                
	
                     

                

        

      

    

    
      
        
          	
                  Telephone: 

                	
                     

                

        

      

    

    
      
        
          	
                  Fax: 

                	
                     

                

        

      

    

    
      
        
          	
                  Contact
      Person: 

                	
                     

                

        

      

    

    
      
        
          	
                  E-mail
      address of Contact Person: 

                	
                     

                

        

      

    

     

    
      	
              3.

            	
              Beneficial Ownership of
      Registrable Securities Issuable Pursuant to the Purchase
      Agreement:

            

    

     

    
      	
               
      

            	
              (a)

            	
              Type
      and Number of Registrable Securities beneficially owned and issued
      pursuant to the Agreement:

            

    

     

    
      

      

      

    

     

    
      	
               
      

            	
              (b)

            	
              Number
      of shares of Common Stock to be registered pursuant to this Notice for
      resale:

            

    

     

    
      

      

      

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      	
              4.

            	
              Broker-Dealer
      Status:

            

    

     

    
      	
               
      

            	
              (a)

            	
              Are
      you a broker-dealer registered pursuant to Section 15 of the Exchange
      Act?

            

    

     

    
      	
               
      

            	
              Yes   ̈

            	
              No   ̈

            

    

     

    
      	
               
      

            	
              (b)

            	
              If
      "yes" to Item 4(a), did you receive your Registrable Securities as
      compensation for investment banking services to the
    Company?

            

    

     

    
      	
               
      

            	
              Yes   ̈

            	
              No   ̈

            

    

     

    
      	
              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 registered pursuant to Section 15 of
      the Exchange Act?

            

    

     

    
      	
               
      

            	
              Yes   ̈

            	
              No   ̈

            

    

     

    Note:    If yes,
provide a narrative explanation below:

     

    
      

      

    

     

    
      	
               
      

            	
              (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   ̈

            	
              No   ̈

            

    

     

    
      	  	
              Note:

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

            

    

     

    
      	
               
      

            	
              For
      the purposes of this Item 4, an "affiliate" of a registered broker-dealer
      shall include any company that directly, or indirectly through one or more
      intermediaries, controls, or is controlled by, or is under common control
      with such broker-dealer, and does not include any individuals employed by
      such broker-dealer or its
affiliates.

            

    

     

    
      	
              5.

            	
              Nature of Your Beneficial
      Ownership:

            

    

     

    
      	
               
      

            	
              (a)

            	
              If
      the name of the beneficial owner of the Registrable Securities set forth
      in your response to Item 1(a) above is that of a limited partnership,
      state the names of the general partners of such limited
      partnership:

            

    

     

    
      

      

      

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              (b)

            	
              With
      respect to each general partner listed in Item 5(a) above who is not a
      natural person, and is not publicly held, name each stockholder (or
      managing member, if applicable) of such general partner. If any of these
      named stockholders are not natural persons or publicly held entities,
      please provide the same information. This process should be repeated until
      you reach natural persons or a publicly held
  entity.

            

    

     

    
      

      

      

    

     

    
      	
               
      

            	
              (c)

            	
              If
      you are not publicly held, name the entity that exercises voting and
      dispositive power over the Registrable Securities set forth in Item 3
      above (the "Controlling Entity"). If the Controlling Entity is not a
      natural person or a publicly held entity, please name the entity that
      controls such Controlling Entity and provide the same information for the
      entity controlling the Controlling Entity. This process should be repeated
      until you reach natural persons or a publicly held
  entity.

            

    

     

    
      	
               
      

            	
              (i)

            	
              Full
      legal name of Controlling Entity(ies) or natural person(s) who have sole
      or shared voting or dispositive power over the Registrable
      Securities:

            

    

     

    
      

    

     

    
      	
               
      

            	
              (a)

            	
              Business
      address (including street address) (or residence if no business address),
      telephone number and facsimile number of such
  person(s):

            

    

    

    
      
        
          
            
              
                	
                        Address:

                      	
                           

                      
	 
      	
                           

                      
	 
      	
                           

                      
	 
      	
                           

                      
	
                        Telephone: 

                      	
                           

                      
	
                        Fax:

                      	
                           

                      

              

            

          

        

      

    

     

    
      	
               
      

            	
              (b)

            	
              Name(s)
      of stockholders:

            

    

     

    
      

      

    

     

    
      	
               
      

            	
              (ii)

            	
              Full
      legal name of Controlling
Entity(ies):

            

    

     

    
      
        	  	
                (a)

              	
                Business
      address (including street address) (or residence if no business address),
      telephone number and facsimile number of such
  person(s):

              

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    Address:

                  	
                       

                  
	 
      	
                       

                  
	 
      	
                       

                  
	 
      	
                       

                  
	
                    Telephone: 

                  	
                       

                  
	
                    Fax:

                  	
                       

                  

          

        

      

    

     

    
      	
               
      

            	
              (b) 
      Name(s) of shareholders:

            

    

     

    
      

      

    

     

    
      	
              6.

            	
              Beneficial Ownership of Other
      Securities of the Company Owned by the Selling
      Stockholder.

            

    

     

    Except as set forth below in this
Item 6, 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.

     

    Type and
amount of other securities beneficially owned:

     

    
      

      

    

     

    
      	
              7.

            	
              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:

     

    
      

      
  

    
      	
              8.

            	
              Plan of
      Distribution:

            

    

     

    The undersigned has reviewed the
form of Plan of Distribution attached as Annex A to the Registration Rights
Agreement, and hereby confirms that, except as set forth below, the information
contained therein regarding the undersigned and its plan of distribution is
correct and complete.

     

    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 and prior to the effective date of any
applicable Resale Registration Statement.  All notices hereunder and
pursuant to the Agreement shall be made in writing, by hand delivery, confirmed
or facsimile transmission, first-class mail or air courier guaranteeing
overnight delivery at the address set forth below.  In the absence of
any such notification, the Company shall be entitled to continue to rely on the
accuracy of the information in this Notice and Questionnaire.

     

    By
signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items (1) through (8) above and the inclusion
of such information in the Resale Registration Statement and the
Prospectus.  The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or amendment of
any such Registration Statement and the Prospectus.

     

    Once this
Notice and Questionnaire is executed by the undersigned and received by the
Company, the terms of this Notice and Questionnaire, and the representations and
warranties contained herein, shall be binding on, shall inure to the benefit of
and shall be enforceable by the respective successors, heirs, personal
representatives, and assigns of the Company and the undersigned with respect to
the Registrable Securities beneficially owned by the undersigned and listed in
Item 3 above.

     

    I confirm
that, to the best of my knowledge and belief, the foregoing statements
(including without limitation the answers to this Questionnaire) are
correct.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    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:

    

    Ted
Warner

    Northland
Capital Markets

    45 South
7th Street

    Suite
2000

    Minneapolis,
MN 55402

    Tel:
612-851-4906

    Fax:
612-308-8293

    Email:
twarner@northlandcapitalmarkets.comExhibit
4.12

     

    
      
        

      
 

    Company

    
      

      and

      

      Computershare
Trust Company, N.A.,

      

      Warrant
Agent

       

      
        
          

        

    

    Series A
Warrant Agreement

    

    Dated as
of _________, 2011

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE OF
CONTENTS

     

    
      
        
          	 
      	 
      	
                  Page

                
	 
      	 
      	 
      
	
                  Section
      1.

                	
                  Certain
      Definitions

                	
                  1

                
	 
      	 
      	 
      
	
                  Section
      2.

                	
                  Appointment
      of Warrant Agent

                	
                  2

                
	 
      	 
      	 
      
	
                  Section
      3.

                	
                  Form
      of Warrant Certificates

                	
                  2

                
	 
      	 
      	 
      
	
                  Section
      4.

                	
                  Countersignature
      and Registration

                	
                  2

                
	 
      	 
      	 
      
	
                  Section
      5.

                	
                  Transfer,
      Split Up, Combination and Exchange of Warrant Certificates; Mutilated,
      Destroyed, Lost or Stolen Warrant Certificates

                	
                  3

                
	 
      	 
      	 
      
	
                  Section
      6.

                	
                  Exercise
      of Warrants; Exercise Price; Expiration Date

                	
                  4

                
	 
      	 
      	 
      
	
                  Section
      7.

                	
                  Cancellation
      and Destruction of Warrant Certificates

                	
                  7

                
	 
      	 
      	 
      
	
                  Section
      8.

                	
                  Certain
      Representations; Reservation and Availability of Shares of Common Stock or
      Cash

                	
                  7

                
	 
      	 
      	 
      
	
                  Section
      9.

                	
                  Common
      Stock Record Date

                	
                  9

                
	 
      	 
      	 
      
	
                  Section
      10.

                	
                  Adjustment
      of Exercise Price, Number of Shares of Common Stock or Number of the
      Company Warrants

                	
                  9

                
	 
      	 
      	 
      
	
                  Section
      11.

                	
                  Certification
      of Adjusted Exercise Price or Number of Shares of Common
    Stock

                	
                  13

                
	 
      	 
      	 
      
	
                  Section
      12.

                	
                  Reclassification,
      Consolidation, Purchase, Combination, Sale or Conveyance

                	
                  13

                
	 
      	 
      	 
      
	
                  Section
      13.

                	
                  Fractional
      Shares of Common Stock.

                	
                  14

                
	 
      	 
      	 
      
	
                  Section
      14.

                	
                  Agreement
      of Warrant Certificate Holders

                	
                  14

                
	 
      	 
      	 
      
	
                  Section
      15.

                	
                  Warrant
      Certificate Holder Not Deemed a Shareholder

                	
                  15

                
	 
      	 
      	 
      
	
                  Section
      16.

                	
                  Concerning
      the Warrant Agent.

                	
                  15

                
	 
      	 
      	 
      
	
                  Section
      17.

                	
                  Purchase
      or Consolidation or Change of Name of Warrant Agent

                	
                  16

                
	 
      	 
      	 
      
	
                  Section
      18.

                	
                  Duties
      of Warrant Agent

                	
                  17

                
	 
      	 
      	 
      
	
                  Section
      19.

                	
                  Change
      of Warrant Agent

                	
                  19

                

        

      

    

    
      
         

      

      
        i

        
          

        

      

      
         

      

    

    
 

    
      
        
          	 
      	 
      	
                  Page

                
	 
      	 
      	 
      
	
                  Section
      20.

                	
                  Issuance
      of New Warrant Certificates

                	
                  19

                
	 
      	 
      	 
      
	
                  Section
      21.

                	
                  Covenants.

                	
                  19

                
	 
      	 
      	 
      
	
                  Section
      22.

                	
                  Notices

                	
                  20

                
	 
      	 
      	 
      
	
                  Section
      23.

                	
                  Supplements
      and Amendments

                	
                  20

                
	 
      	 
      	 
      
	
                  Section
      24.

                	
                  Successors

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      25.

                	
                  Benefits
      of this Agreement

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      26.

                	
                  Governing
      Law

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      27.

                	
                  Counterparts

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      28.

                	
                  Captions

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      29.

                	
                  Information

                	
                  21

                
	 
      	 
      	 
      
	
                  Section
      30.

                	
                  Force
      Majeure

                	
                  21

                

        

      

    

    
      
         

      

      
        ii

        
          

        

      

      
         

      

    

     

    SERIES A WARRANT
AGREEMENT

     

    This
SERIES A WARRANT AGREEMENT (this “Agreement”), dated as of ___________, 2011, is
entered into among Repros Therapeutics Inc., a Delaware corporation (the
“Company”), Computershare, Inc., a Delaware corporation and its fully owned
subsidiary Computershare Trust Company, N.A., a national banking association
(collectively, the “Warrant Agent” or individually “Computershare” and the
“Trust Company,” respectively).

    

    WITNESSETH

     

    WHEREAS,
the Company, at or about the time that it is entering into this Agreement,
proposes to issue and sell to public investors Series A Warrants (the
“Warrants”) entitling the holder or holders thereof to purchase an aggregate of
2,070,000 shares of common stock, par value $.001 per share, of the Company (the
“Common Stock”) upon the terms and subject to the conditions hereinafter set
forth;

     

    WHEREAS,
the Company has filed with the Securities and Exchange Commission (the “SEC”) a
Registration Statement on Form S-1, No. 333-171196 (“Registration Statement”),
for the registration, under the Securities Act of 1933, as amended, of, among
other securities, the Warrants and the shares of Common Stock issuable upon
exercise of the Warrants (the “Warrant Shares”); and

    

    WHEREAS,
the Company wishes the Warrant Agent to act on behalf of the Company, and the
Warrant Agent is willing so to act, in connection with the issuance, transfer,
exchange and exercise of the Warrants;

     

    NOW,
THEREFORE, in consideration of the premises and the mutual agreements herein set
forth, the parties hereby agree as follows:

     

    Section
1.             Certain
Definitions.     For
purposes of this Agreement, the following terms have the meanings
indicated:

     

    (a)          “Affiliate”
has the meaning ascribed to it in Rule 12b-2 under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”).

     

    (b)          “Business
Day” means any day other than a Saturday, Sunday or a day on which the New York
Stock Exchange  is authorized or obligated by law or executive order
to close.

     

    (c)          “Close
of Business” on any given date means 5:00 p.m., New York City time, on such
date; provided,
however, that
if such date is not a Business Day it means 5:00 p.m., New York City time, on
the next succeeding Business Day.

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    (d)          “Current
Market Price”, as of any date, with respect to a share of Common Stock, shall be
deemed to be the average closing price for the ten consecutive trading days
immediately preceding such date on the principal national securities exchange or
Nasdaq system on which the shares of Common Stock are listed or admitted to
trading or, if not listed or admitted to trading on any national securities
exchange or Nasdaq system, the average of the reported bid and asked prices
during such 10 trading day period in the over-the-counter market as furnished by
the Pink Sheets LLC, or, if such firm is not then engaged in the business of
reporting such prices, as furnished by any similar firm then engaged in such
business selected by the Company, or, if there is no such firm, as furnished by
any member of the Financial Industry Regulatory Authority selected by the
Company or, if the shares of Common Stock are not publicly traded, the Current
Market Price shall be determined in good faith by the Board of Directors of the
Company.

     

    (e)          “Effective
Date” means ________, 2011.

     

    (f)          
“Exercise Price” means the Initial Exercise Price as adjusted from time to time
pursuant to Section 10 hereof.

     

    (g)          “Initial
Exercise Price” means $___ per share of Common Stock.

     

    (h)          “Person”
means an individual, corporation, association, partnership, limited liability
company, joint venture, trust, unincorporated organization, government or
political subdivision thereof or governmental agency or other
entity.

     

    (i)          
“Warrant Certificate” means a certificate in substantially the form attached as
Exhibit 1 hereto representing such number of Warrants as is indicated on the
face thereof.

     

    Section
2.             Appointment of Warrant
Agent.  The
Company hereby appoints the Warrant Agent to act as agent for the Company in
accordance with the terms and conditions hereof, and the Warrant Agent hereby
accepts such appointment.  The Company may from time to time appoint
such Co-Warrant Agents as it may, in its sole discretion, deem necessary or
desirable. In no event will the Warrant Agent be liable for the acts or
omissions of any such Co-Warrant Agent.

     

    Section
3.             Form of Warrant
Certificates.  The
Warrant Certificates (together with the form of election to purchase Common
Stock (the “Exercise Notice”) and the form of assignment to be printed on the
reverse thereof) shall be substantially in the form of Exhibit 1 hereto and
may have such marks of identification or designation and such legends, summaries
or endorsements printed thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement or as may be required to
comply with any law or with any rule or regulation made pursuant thereto, or to
conform to usage.

     

    Section
4.             Countersignature and
Registration.  The
Warrant Certificates shall be executed on behalf of the Company by its Chairman,
its President or a Vice President, either manually or by facsimile signature,
and have affixed thereto the Company’s seal or a facsimile thereof which shall
be attested by the Secretary or an Assistant Secretary of the Company, either
manually or by facsimile signature.  The Warrant Certificates shall be
countersigned by the Warrant Agent either manually or by facsimile signature and
shall not be valid for any purpose unless so countersigned.  In case
any officer of the Company who shall have signed any of the Warrant Certificates
shall cease to be such officer of the Company before countersignature by the
Warrant Agent and issuance and delivery by the Company, such Warrant
Certificates, nevertheless, may be countersigned by the Warrant Agent, issued
and delivered with the same force and effect as though the person who signed
such Warrant Certificate had not ceased to be such officer of the Company; and
any Warrant Certificate may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Warrant Certificate, shall be a
proper officer of the Company to sign such Warrant Certificate, although at the
date of the execution of this Warrant Agreement any such person was not such an
officer.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    The
Warrant Agent will keep or cause to be kept, at one of its offices in Canton,
Massachusetts, or at the office of one of its agents, books for registration and
transfer of the Warrant Certificates issued hereunder.  Such books
shall show the names and addresses of the respective holders of the Warrant
Certificates, the number of warrants evidenced on the face of each of such
Warrant Certificate and the date of each of such Warrant
Certificate.

     

    The
Warrant Agent will create a special account for the issuance of Warrants and the
Warrant Shares.  The Company shall provide an opinion of counsel dated
as of the Effective Date to set up reserve of Warrants and reserve of shares of
Common Stock for issuance upon exercise of the Warrants, upon which opinion the
recipients of the Warrants and Warrant Shares shall be entitled to
rely.  The opinion shall state that:

     

    (1)           The
Warrants and Warrant Shares are registered under the Securities Act of 1933, as
amended;

     

    (2)           The
Warrants, when issued in accordance with the terms of the Warrant
Agreement, will be valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms and are free and clear of all
liens and encumbrances; and

     

     (3)           Upon
the valid exercise in accordance with the terms of the Warrants and payment of
the consideration required in connection therewith, the Warrant Shares will be
validly issued, fully paid and non-assessable, free and clear of all liens and
encumbrances.

     

    Section
5.             Transfer, Split Up,
Combination and Exchange of Warrant Certificates; Mutilated, Destroyed, Lost or
Stolen Warrant Certificates.  Subject
to the provisions of Section 13 hereof and the last sentence of this first
paragraph of Section 5 and subject to applicable law, rules or regulations,
restrictions on transferability that may appear on Warrant Certificates in
accordance with the terms hereof or any “stop transfer” instructions the Company
may give to the Warrant Agent, at any time after the Close of Business on the
date hereof, at or prior to the Close of Business on the Expiration Date (as
such term is hereinafter defined), any Warrant Certificate or Warrant
Certificates may be transferred, split up, combined or exchanged for another
Warrant Certificate or Warrant Certificates, entitling the registered holder to
purchase a like number of shares of Common Stock as the Warrant Certificate or
Warrant Certificates surrendered then entitled such holder to
purchase.  Any registered holder desiring to transfer, split up,
combine or exchange any Warrant Certificate shall make such request in writing
delivered to the Warrant Agent, and shall surrender the Warrant Certificate or
Warrant Certificates to be transferred, split up, combined or exchanged at the
principal office of the Warrant Agent.  Thereupon the Warrant Agent
shall, subject to the last sentence of this first paragraph of Section 5,
countersign and deliver to the person entitled thereto a Warrant Certificate or
Warrant Certificates, as the case may be, as so requested.  The
Company may require payment of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any transfer, split up,
combination or exchange of Warrant Certificates, together with reimbursement to
the Company and the Warrant Agent of all reasonable expenses incidental
thereto.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    Upon
receipt by the Company and the Warrant Agent of evidence reasonably satisfactory
to them of the loss, theft, destruction or mutilation of a Warrant Certificate,
and, in case of loss, theft or destruction, of indemnity or security in
customary form and amount which shall include a corporate bond of indemnity
satisfactory to the Warrant Agent, and reimbursement to the Company and the
Warrant Agent of all reasonable expenses incidental thereto, and upon surrender
to the Warrant Agent and cancellation of the Warrant Certificate if mutilated,
the Company will make and deliver a new Warrant Certificate of like tenor to the
Warrant Agent for delivery to the registered holder in lieu of the Warrant
Certificate so lost, stolen, destroyed or mutilated.

     

    Section
6.             Exercise of Warrants;
Exercise Price; Expiration Date

     

    (a)          The
Warrants shall be exercisable in whole or in part immediately upon and after
issuance.  The Warrants shall cease to be exercisable and shall
terminate and become void, and all rights thereunder and under this Agreement
shall cease, at the Close of Business on the date which is the five year
anniversary of the Effective Date (the “Expiration Date”).  Subject to
the foregoing and to Section 6(b) below, the registered holder of any
Warrant Certificate may exercise the Warrants evidenced thereby in whole or in
part upon surrender of the Warrant Certificate, with the Exercise Notice duly
executed, to the Warrant Agent, or Computershare, as applicable,  at
the principal office of the Warrant Agent in Canton, Massachusetts or to the
office of one of its agents as may be designated by the Warrant Agent from time
to time, together with payment of the Exercise Price, which may be made, at the
option of the holder, (i) in cash in United States dollars or by certified or
official bank check, (ii) in the event that the Current Market Price exceeds the
Exercise Price, by a Cashless Exercise (as defined below) or (iii) by any
combination of (i) and (ii), to the principal office of the Warrant Agent where
the Warrant Certificate is being surrendered.  A "Cashless Exercise"
shall mean an exercise of a Warrant in accordance with the immediately following
two sentences.  To effect a Cashless Exercise, the holder may exercise
a Warrant or Warrants without payment of the Exercise Price in cash by
surrendering such Warrant or Warrants (represented by one or more Warrant
Certificates) and, in exchange therefor, receiving such number of shares of
Common Stock equal to the product of (1) that number of shares of Common Stock
for which such Warrants are exercisable and which would be issuable in the event
of an exercise with payment in cash of the Exercise Price and (2) the Cashless
Exercise Ratio (as defined below).  The "Cashless Exercise Ratio"
shall equal a fraction, the numerator of which is the excess of the Current
Market Price (calculated as set forth in this agreement) per share of Common
Stock on the date of exercise over the Exercise Price per share of Common Stock
as of the date of exercise and the denominator of which is the Current Market
Price per share of Common Stock on the date of exercise.  Upon
surrender of a Warrant Certificate representing more than one Warrant in
connection with a holder's option to elect a Cashless Exercise, such holder must
specify the number of Warrants for which such Warrant Certificate is to be
exercised (without giving effect to such Cashless Exercise).  All
provisions of this Agreement shall be applicable with respect to a Cashless
Exercise of a Warrant Certificate of less than the full number of Warrants
represented thereby.  No payment or adjustment shall be made on
account of any distributions or dividends on the Common Stock issued upon
exercise of a Warrant.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    The
Company shall calculate and transmit to the Warrant Agent, and the Warrant Agent
shall have no obligation under this section to calculate, the Cashless Exercise
Ratio (and the basis for such calculation (which the Warrant Agent shall have no
obligation under this section to recalculate)).

     

    (b)     
     Upon receipt of a Warrant Certificate at or prior
to the Close of Business on the Expiration Date, with the form of election to
purchase duly executed, accompanied by payment of the Exercise Price for the
shares to be purchased (or election of the Cashless Exercise option) and an
amount equal to any applicable tax or governmental charge referred to in
Section 5 in cash, or by certified check or bank draft payable to the order
of the Company, the Warrant Agent shall thereupon promptly (i) requisition
from any transfer agent of the Common Stock certificates for the number of whole
shares of Common Stock to be purchased, and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests and (ii) 
after receipt of such certificates, use its best efforts to cause the same to be
delivered to or upon the order of the registered holder of such Warrant
Certificate, registered in such name or names as may be designated by such
holder, within three (3) trading days following exercise of such Warrants (the
“Delivery Date”).  Upon receipt by the Company of a Warrant
Certificate at the principal office of the Warrant Agent, with the form of
election to purchase duly executed, and payment of the applicable Exercise Price
as required hereby, the holder of such Warrant Certificate shall be deemed to be
the holder of record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
closed or that certificates representing such shares of Common Stock shall not
then be actually delivered to the holder of such Warrant
Certificate.

     

    (c)     
     In case the registered holder of any Warrant
Certificate shall exercise fewer than all Warrants evidenced thereby, a new
Warrant Certificate evidencing the number of Warrants equivalent to the number
of Warrants remaining unexercised shall be issued by the Warrant Agent to the
registered holder of such Warrant Certificate or to his duly authorized assigns,
subject to the provisions of Sections 5, 6(b) and 13 hereof.

     

    (d)       
   In addition to a holder’s other available remedies, the
Company shall pay to such a holder, in cash, as liquidated damages and not as a
penalty, for non-delivery by the Delivery Date, an amount equal to the
difference between the closing price of the Common Stock on the Delivery Date
and the closing price of the Common Stock on the date the Common Stock is
actually delivered multiplied by the number of Warrant Shares so
exercised.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (e)          The registered holder shall not have the right to
exercise any portion of such holder’s Warrants,
pursuant to Section 6 or otherwise, to the extent that after giving effect to
such issuance after exercise as set forth
on the applicable Exercise Notice duly executed, such holder (together with such
holder’s Affiliates, and any other person or entity acting as a
group together with such holder or any of such holder’s Affiliates),
would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below).  For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned by such holder
and its Affiliates shall include the number of shares of Common Stock
issuable upon exercise of such holder’s Warrants with
respect to which such determination is being made, but shall exclude the number
of shares of Common Stock which would be issuable upon (A) exercise of the
remaining, nonexercised portion of such holder’s Warrants
beneficially owned by such holder or any of its Affiliates and (B) exercise or
conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any other Common Stock
equivalents) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by such holder
or any of its Affiliates.  Except as set forth in the preceding
sentence, for purposes of this Section 6(e), beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and the rules
and regulations promulgated thereunder, it being acknowledged by such holder
that the Company is not representing to such holder that such calculation is in
compliance with Section 13(d) of the Exchange Act and such
holder is solely responsible for any schedules required to be filed in
accordance therewith.   To the extent that the limitation
contained in this Section 6(e) applies, the determination of whether such
holder’s Warrants are exercisable (in relation to other
securities owned by such holder together with any Affiliates) and of which
portion of such holder’s Warrants are exercisable shall be in the sole
discretion of such holder, and the submission of an Exercise Notice shall
be deemed to be such holder’s determination of whether its Warrants are exercisable
(in relation to other securities owned by such holder together with any
Affiliates) and of which portion of such holder’s Warrants are
exercisable, in each case subject to the Beneficial Ownership Limitation,
and the Company shall have no obligation to verify or confirm the accuracy of
such determination or any liability under this Section 6(e).  In
addition, a determination as to any group status as contemplated above shall
be determined in the sole discretion of such holder in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder,
and the acquisition by any or all holders of the Common Stock and the
Warrants and the execution of this Agreement shall not, by
itself, cause any such holders to be considered a group for purposes of the
Exchange Act.  For purposes of determining the Beneficial Ownership
Limitation, in determining the number of outstanding shares of Common Stock, a
holder may rely on the number of outstanding shares of Common Stock as reflected
in (x) the Company’s most recent Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, or such similar form, as the case may be, or (y) any other
written notice by the Company or the Company’s transfer agent
setting forth the number of shares of Common Stock outstanding.  In
any case, the number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of
the Company, including such holder’s Warrants, by
such holder or its Affiliates since the date as of which such number of
outstanding shares of Common Stock was reported.  The “Beneficial Ownership Limitation” shall be 9.999% of the number of shares of
the Common Stock outstanding immediately after giving effect to the issuance of
shares of Common Stock (net of the effects of any Cashless Exercise) issuable
upon exercise of such holder’s Warrants.  Subject to the 20% Limitation (as
defined below), the Beneficial Ownership Limitation provisions of
this Section 6(e) may be waived by such holder, at the election of such holder,
upon not less than sixty-one (61) days’ prior notice to
the Company to waive the Beneficial Ownership Limitation.  So
long
as the Beneficial Ownership Limitation has not been waived by such holder, the
shares of Common Stock underlying such holder’s Warrants in
excess of the Beneficial Ownership Limitation shall not be deemed to be
beneficially owned by such holder for purposes of Section
16 of the Exchange Act.  Notwithstanding anything contained herein to
the contrary, in no event may a holder have the right to exercise such
holder’s Warrants (or otherwise have the right to acquire
capital stock of the Company as a result of holding
Warrants or Warrant Shares) to the extent (and only to the extent) that, following
such exercise or acquisition, such holder would own or beneficially own 20% or
more of the outstanding shares of Common Stock or would otherwise cause such
holder to be an “Acquiring Person”
(as defined under that certain Rights Agreement dated September 1, 1999, as
amended through the date hereof (the “Rights Agreement”),
by and between the Company and Computershare Trust Company, N.A.) after giving effect to such exercise or acquisition (the “20% Limitation”),
and any such exercise or acquisition in excess of the 20% Limitation or attempt
to so exercise or acquire shall be void ab initio.  Each holder of Warrants covenants that such
holder will not exercise such holder’s Warrant in violation of the 20% Limitation and, in the
event any holder violates such covenant by so exercising or attempting to so
exercise its Warrants, such holder shall indemnify and hold the Company harmless
from and against any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liability arising out of such
violation of such covenant.  The limitations contained in this
paragraph shall apply to a successor holder of Warrant
Certificates.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    Section
7.             Cancellation and Destruction
of Warrant Certificates.  All
Warrant Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its agents, be delivered to the Warrant Agent for cancellation or in canceled
form, or, if surrendered to the Warrant Agent, shall be canceled by it, and no
Warrant Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Warrant Agreement.  The
Company shall deliver to the Warrant Agent for cancellation and retirement, and
the Warrant Agent shall so cancel and retire, any other Warrant Certificate
purchased or acquired by the Company otherwise than upon the exercise
thereof.  The Warrant Agent shall deliver all canceled Warrant
Certificates to the Company, or shall, at the written request of the Company,
destroy such canceled Warrant Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company, subject to any applicable
law, rule or regulation requiring the Warrant Agent to retain such canceled
certificates.

     

    Section
8.             Certain Representations;
Reservation and Availability of Shares of Common Stock or
Cash.

     

    (a)          The
Company represents and warrants that this Agreement has been duly authorized,
executed and delivered by the Company and, assuming due authorization, execution
and delivery hereof by the Warrant Agent, constitutes a valid and legally
binding obligation of the Company enforceable against the Company in accordance
with its terms, and the Warrants and, when issued, the Warrant Shares, in each
case, are free and clear of all liens and encumbrances, are fully paid and
non-assessable and have been duly authorized, executed and issued by the Company
and, assuming due authentication of the Warrants by the Warrant Agent pursuant
hereto, constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their terms and entitled to
the benefits hereof; in each case except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors’ rights generally or by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    (b)          The
Company represents and warrants that, immediately prior to the consummation of
the offering described in the Registration Statement, the authorized capital
stock of the Company consists of (i) 75,000,000 shares of Common Stock, of which
9,216,209 shares of Common Stock are issued and outstanding, 2,070,000 shares of
Common Stock are reserved for issuance upon exercise of the Series A Warrants,
1,690,500 shares of Common Stock upon exercise of Series B Warrants and not more
than 827,004 shares of Common Stock are reserved for issuance upon exercise of
employee or other stock options and (ii) 5,000,000 shares of preferred stock,
$.001 par value per share, of which no shares are
outstanding.   The Company represents and warrants that the
shares of Common Stock issued to the holder under the Registration Statement,
when issued, were free and clear of all liens and encumbrances, fully paid and
non-assessable and were duly authorized by the Company.

     

    (c)          The
Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued shares of Common Stock or its
authorized and issued shares of Common Stock held in its treasury, free from
preemptive rights, the number of shares of Common Stock that will be sufficient
to permit the exercise in full of all outstanding Warrants and all other
convertible securities, options and other instruments of the
Company.

    

    (d)          The
Company further covenants and agrees that it will pay when due and payable any
and all federal and state transfer taxes and charges which may be payable in
respect of the original issuance or delivery of the Warrant Certificates or
certificates evidencing Common Stock upon exercise of the
Warrants.  The Company shall not, however, be required to pay any tax
or governmental charge which may be payable in respect of any transfer involved
in the transfer or delivery of Warrant Certificates or the issuance or delivery
of certificates for Common Stock in a name other than that of the registered
holder of the Warrant Certificate evidencing Warrants surrendered for exercise
or to issue or deliver any such certificate for such shares of Common Stock to
such other person upon the exercise of any Warrants until any such tax or
governmental charge shall have been paid (any such tax or governmental charge
being payable by the holder of such Warrant Certificate at the time of
surrender) or until it has been established to the Company’s reasonable
satisfaction that no such tax or governmental charge is due.

     

    (e)          The
Company acknowledges that the bank accounts maintained by Computershare in
connection with the services provided under this Agreement will be in its name
and that Computershare may receive investment earnings in connection with the
investment at Computershare risk and for its benefit of the funds held in those
accounts from time to time.  Neither the Company nor the Holders will
receive interest on any deposits or Exercise Price payments.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    (f)           For
purposes of determining whether a holder is an “Acquiring Person” under the
Rights Agreement, the Company acknowledges, and the Company represents and
warrants that it has taken all necessary action, if any, to ensure, that, as a
result of the provisions of Section 6(e), holders shall not be deemed the
“Beneficial Owner” (as defined in the Rights Agreement) of such holder’s
Warrants (and shares of Common Stock issuable upon exercise thereof) to the
extent that such Warrants (and shares of Common Stock issuable upon exercise
thereof) would exceed the 20% Limitation.  The Company represents and
warrants that the Board of Directors of the Company has taken all necessary
action in order to ensure that, notwithstanding any holder becoming an
“interested person” under Delaware General Corporation Law Section 203 or other
similar anti-takeover provision under the Company’s certificate of incorporation
(or similar charter documents) or the laws of its state of incorporation that is
or could become applicable to the holders as a result of the execution and
delivery of this Agreement, such holder shall not be prohibited from exercising such holder’s Warrants (or
otherwise having the right to acquire capital stock of the Company as a result
of holding Warrants or Warrant
Shares), except to the extent that
exercising such Warrants or otherwise acquiring capital stock of the Company as
a result of holding Warrants or Warrant Shares would cause such holder to exceed
the 20% Limitation.

     

    Section
9.             Common Stock Record
Date.  Each
person in whose name any certificate for shares of Common Stock is issued upon
the exercise of Warrants shall for all purposes be deemed to have become the
holder of record for the Common Stock represented thereby on, and such
certificate shall be dated, the date upon which the Warrant Certificate
evidencing such Warrants was duly surrendered and payment of the Exercise Price
(and any applicable transfer taxes) was made; provided, however, that,
subject to Section 6(b) of this Agreement, if the date of such surrender and
payment is a date upon which the Common Stock transfer books of the Company are
closed, such person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next succeeding day on which
the Common Stock transfer books of the Company are open.

     

    Section
10.           Adjustment of Exercise
Price, Number of Shares of Common Stock or Number of the Company
Warrants.  The
Exercise Price, the number of shares covered by each Warrant and the number of
Warrants outstanding are subject to adjustment from time to time as provided in
this Section 10.

     

    (a)          In
the event the Company shall at any time after the date of this Agreement
(i) declare a dividend on shares of Common Stock payable in shares of any
class of capital stock of the Company, (ii) subdivide the outstanding
shares of Common Stock into a greater number of shares of Common Stock,
(iii) combine the outstanding shares of Common Stock into a smaller number
of shares, or (iv) issue any shares of capital stock in a reclassification
of shares of the Common Stock (including any such reclassification in connection
with a consolidation or merger in which the Company is the continuing
corporation), the Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such subdivision,
combination or reclassification, and the number and kind of shares of capital
stock issuable on such date, shall be proportionately adjusted so that the
holder of any Warrant exercised after such time shall be entitled to receive the
aggregate number and kind of shares of capital stock which, if such Warrant had
been exercised immediately prior to such date and at a time when the Common
Stock transfer books of the Company were open, such holder would have owned upon
such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (b)          In
the event the Company shall fix a record date for the issuance of rights,
options or warrants to all holders of Common Stock (such rights, options or
warrants not being available to holders of Warrants) entitling them (for a
period expiring within 45 calendar days after such date of issue) to subscribe
for or purchase Common Stock (or securities convertible into or exercisable or
exchangeable for Common Stock), at a price per share of Common Stock (or having
a conversion, exercise or exchange price per share of Common Stock, in the case
of a security convertible into or exercisable or exchangeable for Common Stock)
less than the Current Market Price per share of Common Stock on such record date
(or, if there has been no such determination, then the Company must promptly
cause such determination to be made as contemplated by the definition of
“Current Market Price” set forth herein, and any proposed record date must be
postponed until after such determination has been made), the Exercise Price to
be in effect after such record date shall be determined by multiplying the
Exercise Price in effect immediately prior to such record date by a fraction of
which the numerator shall be the number of shares of Common Stock outstanding on
such record date plus the number of shares of Common Stock which the aggregate
offering price of the total number of shares of Common Stock so to be offered
(or the aggregate initial conversion, exercise or exchange price of the
convertible, exercisable or exchangeable securities so to be offered) would
purchase at such Current Market Price and of which the denominator shall be the
number of shares of Common Stock outstanding on such record date plus the number
of additional shares of Common Stock to be offered for subscription or purchase
(or into which the convertible, exercisable or exchangeable securities so to be
offered are initially convertible, exercisable or exchangeable).  In
case such subscription price may be paid in a consideration part or all of which
shall be in a form other than cash, the value of such consideration shall be as
determined in good faith by the Board of Directors of the
Company.  Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights or warrants are not so
issued the Exercise Price shall be adjusted to be the Exercise Price which would
then be in effect if such record date had not been fixed.

     

    (c)          In
the event the Company shall fix a record date for the making of a dividend or
distribution to all holders of Common Stock of any evidences of indebtedness or
assets or subscription rights or warrants (excluding those referred to in
Section 10(a) or (b) or other dividends paid out of retained earnings), the
Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction of which the numerator shall be the Current Market Price per share
of Common Stock on such record date, less the fair market value (as determined
in good faith by the Board of Directors of the Company) of such distribution
applicable to one share of Common Stock, and of which the denominator shall be
such Current Market Price per share of Common Stock.  Such adjustment
shall be made successively whenever such a record date is fixed, and in the
event that such distribution is not so made, the Exercise Price shall again be
adjusted to be the Exercise Price which would then be in effect if such record
date had not been fixed.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    (d)          In
the event the Company shall consummate a tender offer for or otherwise
repurchase or redeem Common Stock, to the extent that the cash and value of any
other consideration included in such payment per share of Common Stock exceeds
the Current Market Price per share of Common Stock on the trading day next
succeeding the Expiration Time (as defined below), unless the Company tenders
for the Warrants on terms which give effect to such excess consideration, the
Exercise Price shall be reduced so that the same shall equal the price
determined by multiplying the Exercise Price in effect immediately prior to the
last time tenders or repurchases or redemptions may be made pursuant to such
tender or repurchase or redemption (the “Expiration Time”) by a fraction of
which the numerator shall be the number of shares of Common Stock outstanding
(including any tendered, repurchased or redeemed shares) at the Expiration Time
multiplied by the Current Market Price per share of the Common Stock on the
trading day next succeeding the Expiration Time, and the denominator shall be
the sum of (A) the fair market value of the aggregate consideration payable
to shareholders based on the acceptance of all shares validly tendered,
repurchased or redeemed and not withdrawn as of the Expiration Time (the shares
deemed so accepted being referred to as the “Purchased Shares”) and (B) the
product of the number of shares of Common Stock outstanding (less any Purchased
Shares) at the Expiration Time and the Current Market Price per share of the
Common Stock on the trading day next succeeding the Expiration Time, such
reduction to become effective immediately prior to the opening of business on
the day following the Expiration Time.  For purposes of this
paragraph (d), the value of non cash-consideration shall be as determined
in good faith by the Board of Directors of the Company.

     

    (e)          Notwithstanding
the foregoing paragraphs (a), (b), (c) and (d), no adjustment in the
Exercise Price pursuant to such paragraphs shall be required unless such
adjustment would require an increase or decrease of at least 1% in such price;
provided, however, that any
adjustments which by reason of this Section 10(e) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment.  All calculations under this Section 10 shall be made
to the nearest cent or the nearest hundredth of a share, as the case may
be.

     

    (f)          In
the event that at any time, as a result of an adjustment made pursuant to
Section 10(a), the holder of any Warrant thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other than shares
of Common Stock, thereafter the number of such other shares so receivable upon
exercise of any Warrant shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the shares contained in Section 10(a), (b), (c) and (d), and the
provisions of Sections 6, 8, 9 and 12 with respect to the shares of Common
Stock shall apply on like terms to any such other shares.

     

    (g)          All
Warrants originally issued by the Company subsequent to any adjustment made to
the Exercise Price hereunder shall evidence the right to purchase, at the
adjusted Exercise Price, the number of shares of Common Stock purchasable from
time to time hereunder upon exercise of the Warrants, all subject to further
adjustment as provided herein.

     

    (h)          Unless
the Company shall have exercised its election as provided in Section 10(i),
upon each adjustment of the Exercise Price as a result of the calculations made
in Section 10(b), (c) and (d), each Warrant outstanding immediately prior
to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Exercise Price, that number of shares (calculated to
the nearest hundredth) obtained by (i) multiplying (x) the number of
shares covered by a Warrant immediately prior to such adjustment by (y) the
Exercise Price in effect immediately prior to such adjustment of the Exercise
Price and (ii) dividing the product so obtained by the Exercise Price in
effect immediately after such adjustment of the Exercise Price.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    (i)          The
Company may elect on or after the date of any adjustment of the Exercise Price
to adjust the number of Warrants, in substitution for any adjustment in the
number of shares of Common Stock purchasable upon the exercise of a
Warrant.  Each of the Warrants outstanding after such adjustment of
the number of Warrants shall be exercisable for one share of Common
Stock.  Each Warrant held of record prior to such adjustment of the
number of Warrants shall become that number of Warrants (calculated to the
nearest hundredth) obtained by dividing the Exercise Price in effect prior to
adjustment of the Exercise Price by the Exercise Price in effect after
adjustment of the Exercise Price.  The Company shall instruct the
Warrant Agent to notify each of the record holders of Warrants of its election
to adjust the number of Warrants, indicating the record date for the adjustment,
and, if known at the time, the amount of adjustment to be made.  Such
record date may be the date on which the Exercise Price is adjusted or any day
thereafter, but shall be at least 10 days later than the date of the public
announcement.  Upon each adjustment of the number of Warrants pursuant
to this Section 10(i), the Company shall instruct the Warrant Agent to
distribute, as promptly as practicable, to holders of record of Warrant
Certificates on such record date Warrant Certificates evidencing, subject to
Section 13, the additional Warrants to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, instruct the
Warrant Agent to distribute to such holders of record in substitution and
replacement for the Warrant Certificates held by such holders prior to the date
of adjustment, and upon surrender thereof, if required by the Company, new
Warrant Certificates evidencing all the Warrants to which such holders shall be
entitled after such adjustment.  Warrant Certificates so to be
distributed shall be issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the adjusted Exercise
Price) and shall be registered in the names of the holders of record of Warrant
Certificates on the record date specified in the public
announcement.

     

    (j)          Irrespective
of any adjustment or change in the Exercise Price or the number of shares of
Common Stock issuable upon the exercise of the Warrants, the Warrant
Certificates theretofore and thereafter issued may continue to express the
Exercise Price per share and the number of shares which were expressed upon the
initial Warrant Certificates issued hereunder.

     

    (k)          The
Company agrees that it will not, by amendment of its Certificate of
Incorporation or through reorganization, consolidation, merger, dissolution or
sale of assets, or by any other voluntary act, avoid or seek to avoid the
observance or performance of any of the covenants, stipulations or conditions to
be observed or performed hereunder by the Company.

     

    (l)          In
any case in which this Section 10 shall require that an adjustment in the
Exercise Price be made effective as of a record date for a specified event, if
any holder of a Warrant exercises such Warrant after such record date, the
Company may elect to defer, until the occurrence of such event, the issuance of
the shares of Common Stock and other capital stock of the Company in excess of
the shares of Common Stock and other capital stock of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price in effect prior
to such adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder’s right to receive such additional shares and/or other
capital securities upon the occurrence of the event requiring such
adjustment.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    Section
11.           Certification of Adjusted
Exercise Price or Number of Shares of Common Stock.  Whenever
the Exercise Price or the number of shares of Common Stock issuable upon the
exercise of each Warrant is adjusted as provided in Section 10 or 12, the
Company shall (a) promptly prepare a certificate setting forth the Exercise
Price and number of shares of Common Stock issuable upon exercise of each
Warrant as so adjusted, and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Warrant Agent and with each transfer
agent for the Common Stock a copy of such certificate and (c) instruct the
Warrant Agent to mail a brief summary thereof to each holder of a Warrant
Certificate.

     

    Section
12.           Reclassification,
Consolidation, Purchase, Combination, Sale or Conveyance.  In
case any of the following shall occur while any Warrants are outstanding:
(i)  any reclassification of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively converted into or
exchanged for other securities, cash or property, or (ii) any
consolidation, merger or combination of the Company with or into another
corporation as a result of which holders of Common Stock shall be entitled to
receive stock, securities or other property or assets (including cash) with
respect to or in exchange for such Common Stock, or (iii) any sale or
conveyance of the property or assets of the Company as, or substantially as, an
entirety to any other entity as a result of which holders of Common Stock shall
be entitled to receive stock, securities or other property or assets (including
cash) with respect to or in exchange for such Common Stock, then the Company, or
such successor corporation or transferee, as the case may be, shall make
appropriate provision by amendment of this Agreement or by the successor
corporation or transferee executing with the Warrant Agent an agreement so that
the holders of the Warrants then outstanding shall have the right at any time
thereafter, upon exercise of such Warrants (in lieu of the number of shares of
Common Stock theretofore deliverable) to receive the kind and amount of
securities, cash and other property receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance as would be
received by a holder of the number of shares of Common Stock issuable upon
exercise of such Warrant immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance.

     

    If the
holders of the Common Stock may elect from choices the kind or amount of
securities or cash receivable upon such reclassification, change, consolidation,
merger, combination, sale or conveyance, then for the purpose of this
Section 12 the kind and amount of securities or cash receivable upon such
reclassification, change, consolidation, merger, combination, sale or conveyance
shall be deemed to be the choice specified by the holder of the Warrant, which
specification shall be made by the holder of the Warrant by the later of
(A) 20 calendar days after the holder of the Warrant is provided with a
final version of all information required by law or regulation to be furnished
to holders of Common Stock concerning such choice, or if no
such  information is required, 20 days after the Company notified the
holder of the Warrant of all material facts concerning such specification and
(B) the last time at which holders of Common Stock are permitted to make
their specification known to the Company.  If the holder of the
Warrant fails to make any specification, the holder’s choice shall be deemed to
be whatever choice is made by a plurality of holders of Common Stock not
affiliated with the Company or any other party to the reclassification, change,
consolidation, merger, combination, sale or conveyance.  Such adjusted
Warrants shall provide for adjustments which, for events subsequent to the
effective date of such new Warrants, shall be as nearly equivalent as may be
practicable to the adjustments provided for in Section 10 and this
Section 12.  The above provisions of this Section 12 shall
similarly apply to successive reclassifications, changes, consolidations,
mergers, combinations, sales and conveyances of the kind described
above.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    The
Company shall instruct the Warrant Agent to mail by first class mail, postage
prepaid, to each registered holder of a Warrant, written notice of the execution
of any such amendment, supplement or agreement.  Any supplemented or
amended agreement entered into by the successor corporation or transferee shall
provide for adjustments, which shall be as nearly equivalent as may be
practicable to the adjustments provided for in Section 10 and this Section
12.  The Warrant Agent shall be under no responsibility to determine
the correctness of any provisions contained in such agreement relating either to
the kind or amount of securities or other property receivable upon exercise of
warrants or with respect to the method employed and provided therein for any
adjustments and shall be entitled to rely upon the provisions contained in any
such agreement.  The provisions of this Section 12 shall
similarly apply to successive reclassifications, changes, consolidations,
mergers, sales and conveyances of the kind described above.

     

    Section
13.           Fractional Shares of Common
Stock.

     

    (a)          The
Company shall not issue fractions of Warrants or distribute Warrant Certificates
which evidence fractional Warrants.  Whenever any fractional Warrant
would otherwise be required to be issued or distributed, the actual issuance or
distribution shall reflect a rounding of such fraction down to the nearest whole
Warrant.

     

    (b)          The
Company shall not issue fractions of shares of Common Stock upon exercise of
Warrants or distribute stock certificates which evidence fractional shares of
Common Stock.  Whenever any fraction of a share of Common Stock would
otherwise be required to be issued or distributed, the actual issuance or
distribution made shall reflect a rounding of such fraction down to the nearest
whole share.

     

    (c)          The
holder of a Warrant by the acceptance of the Warrant expressly waives his right
to receive any fractional Warrant or any fractional share of Common Stock upon
exercise of a Warrant.

     

    Section
14.           Agreement of Warrant
Certificate Holders.  Every
holder of a Warrant Certificate by accepting the same consents and agrees with
the Company and the Warrant Agent and with every other holder of a Warrant
Certificate that:

     

    (a)          the
Warrant Certificates are transferable only on the registry books of the Warrant
Agent if surrendered at the principal office of the Warrant Agent, duly endorsed
or accompanied by a proper instrument of transfer and any reasonable evidence of
authority that may be required by the Warrant Agent. Such evidence shall include
a signature guarantee from an eligible guarantor institution participating in a
signature guarantee program approved by the Securities Transfer Association;
and

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    (b)          the
Company and the Warrant Agent may deem and treat the person in whose name the
Warrant Certificate is registered as the absolute owner thereof and of the
Warrants evidenced thereby (notwithstanding any notations of ownership or
writing on the Warrant Certificates made by anyone other than the Company or the
Warrant Agent) for all purposes whatsoever, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.

     

    Section
15.           Warrant Certificate Holder
Not Deemed a Shareholder.  No
holder, as such, of any Warrant Certificate shall be entitled to vote, receive
dividends or distributions on, or be deemed for any purpose the holder of Common
Stock or any other securities of the Company which may at any time be issuable
on the exercise of the Warrants represented thereby, nor shall anything
contained herein or in any Warrant Certificate be construed to confer upon the
holder of any Warrant Certificate, as such, any of the rights of a shareholder
of the Company or any right to vote for the election of directors or upon any
matter submitted to shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting shareholders, or to receive dividends or distributions or
subscription rights, or otherwise, until the Warrant or Warrants evidenced by
such Warrant Certificate shall have been exercised in accordance with the
provisions hereof

     

    Section
16.           Concerning the Warrant
Agent.

     

    (a)          The
Company agrees to pay to the Warrant Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the
Warrant Agent, its reasonable expenses and counsel fees and other disbursements
incurred in the administration and execution of this Agreement and the exercise
and performance of its duties hereunder.

     

    (b)          The
Company covenants and agrees to indemnify and to hold the Warrant Agent harmless
against any costs, expenses (including reasonable fees of its legal counsel),
losses or damages, which may be paid, incurred or suffered by or to which it may
become subject, arising from or out of, directly or indirectly, any claims or
liability resulting from its actions as Warrant Agent pursuant hereto; provided,
that such covenant and agreement does not extend to, and the Warrant Agent shall
not be indemnified with respect to, such costs, expenses, losses and damages
incurred or suffered by the Warrant Agent as a result of, or arising out of, its
gross negligence, bad faith, or willful misconduct.

     

    (c)          Promptly
after the receipt by the Warrant Agent of notice of any demand or claim or the
commencement of any action, suit, proceeding or investigation, the Warrant Agent
shall, if a claim in respect thereof is to be made against the Company, notify
the Company thereof in writing.   The Company shall be entitled
to participate at its own expense in the defense of any such claim or
proceeding, and, if it so elects at any time after receipt of such notice, it
may assume the defense of any suit brought to enforce any such claim or of any
other legal action or proceeding. For the purposes of this Section 16, the term
“expense or loss” means any amount paid or payable to satisfy any claim, demand,
action, suit or proceeding settled with the express written consent of the
Warrant Agent, and all reasonable costs and expenses, including, but not limited
to, reasonable counsel fees and disbursements, paid or incurred in investigating
or defending against any such claim, demand, action, suit, proceeding or
investigation.

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    (d)          The
Warrant Agent shall be responsible for and shall indemnify and hold the Company
harmless from and against any and all losses, damages, costs, charges, counsel
fees, payments, expenses and liability arising out of or attributable to the
Warrant Agent’s refusal or failure to comply with the terms of this Agreement,
or which arise out of Warrant Agent’s negligence or willful misconduct or which
arise out of the breach of any representation or warranty of the Warrant Agent
hereunder, for which the Warrant Agent is not entitled to indemnification under
this Agreement; provided, however, that Warrant Agent’s aggregate liability
during any term of this Agreement with respect to, arising from, or arising in
connection  with  this  Agreement, or from all
services provided or omitted to be provided under this Agreement, whether in
contract, or in tort, or otherwise, is limited to, and shall not exceed, the
amounts paid under this Agreement by the Company to Warrant Agent as fees and
charges, but not including reimbursable expenses.

     

    (e)          Promptly
after the receipt by the Company of notice of any demand or claim or the
commencement of any action, suit, proceeding or investigation, the Company
shall, if a claim in respect thereof is to be made against the Warrant Agent,
notify the Warrant Agent thereof in writing.  The Warrant Agent shall
be entitled to participate at its own expense in the defense of any such claim
or proceeding, and, if it so elects at any time after receipt of such notice, it
may assume the defense of any suit brought to enforce any such claim or of any
other legal action or proceeding.  For the purposes of this Section
16, the term “expense or loss” means any amount paid or payable to satisfy any
claim, demand, action, suit or proceeding settled with the express written
consent of the Company, and all reasonable costs and expenses, including, but
not limited to, reasonable counsel fees and disbursements, paid or incurred in
investigating or defending against any such claim, demand, action, suit,
proceeding or investigation.

     

    (f)          Neither
party to this Agreement shall be liable to the other party for any
consequential, indirect, special or incidental damages under any provision of
this Agreement or for any consequential, indirect, penal, special or incidental
damages arising out of any act or failure to act hereunder even if that party
has been advised of or has foreseen the possibility of such
damages.

    

    Section
17.           Purchase or Consolidation or
Change of Name of Warrant Agent.  Any
corporation into which the Warrant Agent or any successor Warrant Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Warrant Agent or any successor Warrant
Agent shall be party, or any corporation succeeding to the corporate trust
business of the Warrant Agent or any successor Warrant Agent, shall be the
successor to the Warrant Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment as a successor
Warrant Agent under the provisions of Section 19.  In case at the
time such successor Warrant Agent shall succeed to the agency created by this
Agreement any of the Warrant Certificates shall have been countersigned but not
delivered, any such successor Warrant Agent may adopt the countersignature of
the predecessor Warrant Agent and deliver such Warrant Certificates so
countersigned; and in case at that time any of the Warrant Certificates shall
not have been countersigned, any successor Warrant Agent may countersign such
Warrant Certificates either in the name of the predecessor Warrant Agent or in
the name of the successor Warrant Agent; and in all such cases such Warrant
Certificates shall have the full force provided in the Warrant Certificates and
in this Agreement.

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    In case
at any time the name of the Warrant Agent shall be changed and at such time any
of the Warrant Certificates shall have been countersigned but not delivered, the
Warrant Agent may adopt the countersignature under its prior name and deliver
Warrant Certificates so countersigned; and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name; and in all such cases such Warrant Certificates shall have the full force
provided in the Warrant Certificates and in this Agreement.

     

    Section
18.           Duties of Warrant
Agent.  The
Warrant Agent undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the Company and the
holders of Warrant Certificate, by their acceptance thereof, shall be
bound:

     

    (a)          The
Warrant Agent may consult with legal counsel (who may be legal counsel for the
Company), and the opinion of such counsel shall be full and complete
authorization and protection to the Warrant Agent as to any action taken or
omitted by it in good faith and in accordance with such opinion.

     

    (b)          Whenever
in the performance of its duties under this Agreement the Warrant Agent shall
deem it necessary or desirable that any fact or matter be proved or established
by the Company prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by the Chairman, President or any Vice President of the
Company and by the Treasurer or any Assistant Treasurer or the Secretary of the
Company and delivered to the Warrant Agent; and such certificate shall be full
authentication to the Warrant Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance upon such
certificate.

     

    (c)          The
Warrant Agent shall be liable hereunder only for its own gross negligence, bad
faith or willful misconduct, pursuant to Section 16, above.

     

    (d)          The
Warrant Agent shall not be liable for or by reason of any of the statements of
fact or recitals contained in this Agreement or in the Warrant Certificates
(except its countersignature thereof) or be required to verify the same, but all
such statements and recitals are and shall be deemed to have been made by the
Company only.

     

    (e)          The
Warrant Agent shall not be under any responsibility in respect of the validity
of this Agreement or the execution and delivery hereof (except the due execution
hereof by the Warrant Agent) or in respect of the validity or execution of any
Warrant Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or condition contained
in this Agreement or in any Warrant Certificate; nor shall it be responsible for
the adjustment of the Exercise Price or the making of any change in the number
of shares of Common Stock required under the provisions of Sections 10 or
12 or responsible for the manner, method or amount of any such change or the
ascertaining of the existence of facts that would require any such adjustment or
change (except with respect to the exercise of Warrants evidenced by Warrant
Certificates after actual notice of any adjustment of the Exercise Price); nor
shall it by any act hereunder be deemed to make any representation or warranty
as to the authorization or reservation of any shares of Common Stock to be
issued pursuant to this Agreement or any Warrant Certificate or as to whether
any shares of Common Stock will, when issued, be duly authorized, validly
issued, fully paid and nonassessable.

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    (f)          The
Company agrees that it will perform, execute, acknowledge and deliver or cause
to be performed, executed, acknowledged and delivered all such further and other
acts, instruments and assurances as may reasonably be required by the Warrant
Agent for the carrying out or performing by the Warrant Agent of the provisions
of this Agreement.

     

    (g)          The
Warrant Agent is hereby authorized to accept instructions with respect to the
performance of its duties hereunder from the Chairman or the President or any
Vice President or the Secretary of the Company, and to apply to such officers
for advice or instructions in connection with its duties, and it shall not be
liable and shall be indemnified and held harmless for any action taken or
suffered to be taken by it in good faith in accordance with instructions of any
such officer, provided Warrant Agent carries out such instructions without gross
negligence, bad faith or willful misconduct.

     

    (h)          The
Warrant Agent and any shareholder, director, officer or employee of the Warrant
Agent may buy, sell or deal in any of the Warrants or other securities of the
Company or become pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company or otherwise
act as fully and freely as though it were not Warrant Agent under this
Agreement.  Nothing herein shall preclude the Warrant Agent from
acting in any other capacity for the Company or for any other legal
entity.

     

    (i)          The
Warrant Agent may execute and exercise any of the rights or powers hereby vested
in it or perform any duty hereunder either itself or by or through its attorney
or agents, and the Warrant Agent shall not be answerable or accountable for any
act, default, neglect or misconduct of any such attorney or agents or for any
loss to the Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued employment
thereof.

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    Section
19.           Change of Warrant
Agent.  The
Warrant Agent may resign and be discharged from its duties under this Agreement
upon 30 days’ notice in writing mailed to the Company and to each transfer agent
of the Common Stock by registered or certified mail, and to the holders of the
Warrant Certificates by first-class mail.  The Company may remove the
Warrant Agent or any successor Warrant Agent upon 30 days’ notice in writing,
mailed to the Warrant Agent or successor Warrant Agent, as the case may be, and
to each transfer agent of the Common Stock by registered or certified mail, and
to the holders of the Warrant Certificates by first-class mail.  If
the Warrant Agent shall resign or be removed or shall otherwise become incapable
of acting, the Company shall appoint a successor to the Warrant
Agent.  If the Company shall fail to make such appointment within a
period of 30 days after such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Warrant Agent
or by the holder of a Warrant Certificate (who shall, with such notice, submit
his Warrant Certificate for inspection by the Company), then the registered
holder of any Warrant Certificate may apply to any court of competent
jurisdiction for the appointment of a new Warrant Agent.  Any
successor Warrant Agent, whether appointed by the Company or by such a court,
shall be a corporation organized and doing business under the laws of the United
States or of a state thereof, in good standing, which is authorized under such
laws to exercise corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time of its
appointment as Warrant Agent a combined capital and surplus of at least
$50,000,000.  After appointment, the successor Warrant Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Warrant Agent without further act or deed; but the
predecessor Warrant Agent shall deliver and transfer to the successor Warrant
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the
purpose.  Not later than the effective date of any such appointment,
the Company shall file notice thereof in writing with the predecessor Warrant
Agent and each transfer agent of the Common Stock, and mail a notice thereof in
writing to the registered holders of the Warrant
Certificates.  However, failure to give any notice provided for in
this Section 19, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Warrant Agent or the appointment
of the successor Warrant Agent, as the case may be.

     

    Section
20.           Issuance of New Warrant
Certificates.  Notwithstanding
any of the provisions of this Agreement or of the Warrants to the contrary, the
Company may, at its option, issue new Warrant Certificates evidencing Warrants
in such form as may be approved by its Board of Directors to reflect any
adjustment or change in the Exercise Price per share and the number or kind or
class of shares of stock or other securities or property purchasable under the
several Warrant Certificates made in accordance with the provisions of this
Agreement.

     

    Section
21.           Covenants.

     

    (a)          For
so long as any of the Warrants remain outstanding, the Company shall use its
best efforts to maintain the effectiveness of the Registration Statement for the
issuance thereunder of the Warrant Shares.  If at any time following
the date hereof the Registration Statement is not effective or is not otherwise
available for the issuance of the Warrant Shares, the Company shall immediately
notify the holders of the Warrants in writing that the Registration Statement is
not then effective and thereafter shall promptly notify such holders when the
Registration Statement is effective again and available for the issuance of the
Warrant Shares.

     

    (b)          During
the period from the Effective Date until the date on which no Warrants are
outstanding, the Company shall timely file all reports required to be filed with
the SEC pursuant to the Exchange Act, and the Company shall not terminate its
status as an issuer required to file reports under the Exchange Act even if the
Exchange Act or the rules and regulations thereunder would no longer require or
otherwise permit such termination.

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    (c)          So
long as any Warrants remain outstanding, the Company shall use its reasonable
best efforts to at all times have authorized, and reserved for the purpose of
issuance, no less than 100% of the maximum number of shares of Common Stock
issuable upon exercise of all the Warrants (without regard to any limitations on
the exercise of the Warrants set forth therein), less the number of Warrant
Shares represented by any such Warrants that have been exercised, and all other
convertible securities, options and other instruments of the
Company.

     

    Section
22.           Notices.  Notices
or demands authorized by this Agreement to be given or made (i) by the
Warrant Agent or by the holder of any Warrant Certificate to or on the Company,
(ii) subject to the provisions of Section 19, by the Company or by the
holder of any Warrant Certificate to or on the Warrant Agent or (iii) by
the Company or the Warrant Agent to the holder of any Warrant Certificate, shall
be deemed given (x) on the date delivered, if delivered personally,
(y) on the first Business Day following the deposit thereof with Federal
Express or another recognized overnight courier, if sent by Federal Express or
another recognized overnight courier, and (z) on the fourth Business Day
following the mailing thereof with postage prepaid, if mailed by registered or
certified mail (return receipt requested), in each case to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):

     

    (a)          If
to the Company, to:

     

    Repros
Therapeutics, Inc.

    2408
Timberloch Place. B-7

    The
Woodlands, Texas 77380

    Attention:
Joseph S. Podolski

    Telecopy:
(281) 719-3446

    

    (b)          If
to the Warrant Agent, to:

         

    Computershare
Trust Company, N.A.

    250
Royall Street

    Canton,
Massachusetts 02021

    Attention:
Client Administration

    Telecopy:  (781)
575-2549

    

    (c)          If
to the holder of any Warrant Certificate, to the address of such holder as shown
on the registry books of the Company.  Any notice required to be
delivered by the Company to the registered holder of any Warrant may be given by
the Warrant Agent on behalf of the Company.

     

    Section
23.           Supplements and
Amendments.

     

    (a)         
The Company and the Warrant Agent may from time to time supplement or amend this
Agreement without the approval of any holders of Warrant Certificates in order
to cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions herein, or to
make any other provisions with regard to matters or questions arising hereunder
which the Company and the Warrant Agent may deem necessary or desirable and
which shall not adversely affect the interests of the holders of Warrant
Certificates.

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    (b)          In
addition to the foregoing, with the consent of holders of Warrants entitled,
upon exercise thereof, to receive not less than 66 2/3% of the shares of Common
Stock issuable thereunder, the Company and the Warrant Agent may modify this
Agreement for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Warrant Agreement or modifying in
any manner the rights of the holders of the Warrant Certificates; provided, however, that no
modification of the terms (including but not limited to the adjustments
described in Section 10) upon which the Warrants are exercisable or
reducing the percentage required for consent to modification of this Agreement
may be made without the consent of the holder of each outstanding Warrant
Certificate affected thereby.

     

    Section
24.           Successors.  All
covenants and provisions of this Agreement by or for the benefit of the Company
or the Warrant Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.

     

    Section
25.           Benefits of this
Agreement .  Nothing
in this Agreement shall be construed to give any Person, other than the Company,
the Warrant Agent and the registered holders of the Warrant Certificates, any
legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company, the
Warrant Agent and the registered holders of the Warrant
Certificates.

     

    Section
26.           Governing
Law.  This
Agreement and each Warrant Certificate issued hereunder shall be governed by,
and construed in accordance with, the laws of New York without giving effect to
the conflicts of law principles thereof.

     

    Section
27.           Counterparts.  This
Agreement may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.

     

    Section
28.           Captions.  The
captions of the sections of this Agreement have been inserted for convenience
only and shall not control or affect the meaning or construction of any of the
provisions hereof.

     

    Section
29.           Information.  The
Company agrees to promptly provide the registered holders of the Warrants the
information it is required to provide to the holders of the Common
Stock.

     

    Section
30.           Force
Majeure.  Notwithstanding
anything to the contrary contained herein, Warrant Agent shall not be liable for
any delays or failures in performance resulting from acts beyond its reasonable
control including, without limitation, acts of God, terrorist acts, shortage of
supply, breakdowns or malfunctions, interruptions or malfunction of computer
facilities, or loss of data due to power failures or mechanical difficulties
with information storage or retrieval systems, labor difficulties, war, or civil
unrest.

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    Section
31.           Confidentiality.   

        

    The
Warrant Agent (or Co-Warrant Agent, if any) and the Company agree that all
books, records, information and data pertaining to the business of the other
party, including inter alia, personal, non-public  warrant holder
information, which are exchanged or received pursuant to the negotiation or the
carrying out of this Agreement including the fees for services set forth in the
attached schedule shall remain confidential, and shall not be voluntarily
disclosed to any other person, except as may be required by
law.
   

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    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	
                                                REPROS
      THERAPEUTICS INC.

                                              
	 
      	 
      	 
      
	
                                                By:

                                              	 
      
	 
      	
                                                Name:

                                              	 
      
	 
      	
                                                Title:

                                              	 
      
	 
      
	
                                                COMPUTERSHARE
      TRUST COMPANY, N.A.

                                              
	 
      	 
      	 
      
	
                                                By:

                                              	 
      
	 
      	
                                                Name:

                                              	 
      
	 
      	
                                                Title:

                                              	 
      
	 
      
	
                                                COMPUTERSHARE
      INC.

                                              
	 
	
                                                By:

                                              	 
      
	 
      	
                                                Name:

                                              	 
      
	 
      	
                                                Title:

                                              	 
      

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        23

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