Document:

Unassociated Document

    HOLDBACK
      ESCROW AGREEMENT

     

    This
      Holdback Escrow Agreement, dated as of May 30, 2008 (this “Agreement”),
      is
entered
      into by and among Genesis
      Pharmaceuticals Enterprises, Inc., a Florida corporation
      (the
“Company”),
      the
      investors set forth on Exhibit
      A
      and
      signatory hereto (collectively, the “Investors”),
      and
      Loeb & Loeb LLP
      (the
“Escrow
      Agent”).
      The
      principal address of each of the parties hereto is set forth
      on
Exhibit
      A.
      

     

    WITNESSETH:
      

     

    WHEREAS,
      the Company proposes
      to make a private offering to the Investors
      (the
“Offering”)
      of the
      Company’s 6% Convertible Notes due May 30, 2011 (“Notes”)and warrants to
      purchase shares of the Company’s common stock, par value $0.001 per share
      (“Common Stock”) pursuant
      to that
      certain Securities Purchase Agreement, dated as of the date hereof, by and
      among
      the Company, the Investors and certain other parties signatory thereto
      (the
      “Securities
      Purchase Agreement”),
      in an
      aggregate amount of approximately Thirty Million dollars
      ($30,000,000)
      (capitalized terms used but not otherwise defined herein shall have the
      respective meanings given to such terms in the Securities Purchase
      Agreement);

     

    WHEREAS,
      pursuant to the Securities Purchase Agreement, the Company has agreed that
      an
      aggregate of $4,000,000 of the aggregate Investment Amounts paid by Investors
      to
      the escrow account established in accordance with the Closing Escrow Agreement
      (the “Escrowed
      Funds”),
      will
      be deposited at Closing with the Escrow Agent, to continue to be held in
escrow,
      administered and distributed as described in Section 4.12 of the Securities
      Purchase Agreement and in accordance with Section 3 of this
      Agreement;
      and

     

    WHEREAS,
      as a material inducement for the Investors to
      enter
      into the Securities Purchase Agreement and consummate the Closing, the Company
      and Escrow Agent have agreed to enter into this Agreement.

     

    NOW,
      THEREFORE, in consideration of the mutual promises herein contained and
      intending to be legally bound, the parties hereby agree as follows:

     

    1. Appointment
      of Escrow Agent.
      The
      Company hereby appoints Escrow Agent to act as escrow
      agent in accordance with the terms of this Agreement, and the Escrow
Agent
      hereby accepts such appointment.

     

    2.  Delivery
      of the Escrowed Funds.

     

    2.1 The
      Company hereby directs that the Escrowed
      Funds be delivered simultaneously with the Closing to the Escrow Agent’s account
      (the “Escrow
      Account”)
      as
      follows:

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	
              Bank
                Name:

            	
              CITI
                PRIVATE BANK

            
	
              Bank
                Address:

            	
              666
                Fifth Avenue, New York, NY 10103

            
	
              ABA
                Number:

            	
              021000089

            
	
              Beneficiary:

            	
              Genesis
                Pharmaceuticals Enterprises, Inc.

            
	
              Escrowed
                Funds:

            	
              $4,000,000.00

            

    

    

    3. Escrow
      Agent to Hold and Disburse Escrowed Funds.
      Promptly following the Closing, the Escrow Agent will provide written notice
      to
      the Company (for simultaneous distribution to the Investors) that the Escrow
      Agent has received the entire amount of Escrowed Funds in the Escrow Account.
      The Escrow Agent will hold and
      disburse the Escrowed Funds received by it pursuant to the terms of this
      Agreement, as follows: 

     

    3.1 Board
      Holdback Escrow.
      Pursuant to Section 4.12(a) of the Securities Purchase Agreement, the Company
      has undertaken that no later than 120 days following the Closing Date, the
      Board
      of Directors of the Company shall be comprised of a minimum of five members
      (at
      least two of whom shall be fluent English speakers who possess
      experience such that he or she can fulfill its fiduciary obligations and other
      responsibilities as a director of
      a
      United States publicly listed company incorporated in the United States), a
      majority of which shall be “independent directors” as such term is defined in
      NASDAQ Marketplace Rule 4200(a)(15) acceptable to Pope. Accordingly, $2,000,000
      (the
      “Board
      Holdback Escrow
      Amount”)
      of the
      Escrowed Funds is to be held in the Escrow Account subject to the satisfaction
      of the Company’s obligations under this Section 3.1 and Section 4.12(a) of the
      Securities Purchase Agreement. Upon the Company’s satisfaction of the aforesaid
      obligations in this Section 3.1 and Section 4.12(a) of the Securities Purchase
      Agreement, the Company and Investors that have invested at least a majority
      of
      the total Investment Amount under the Purchase Agreement (a “Majority
      in Interest of the Investors”)
      shall
      execute and deliver written instructions with reference to this Section 3.1
      to
      release the Board Holdback Escrow Amount to the Company (“Instructions
      to Release Board Holdback”).
      Within one (1) Business Day following its receipt of Instructions to Release
      Board Holdback (with wire instructions attached) jointly executed by the Company
      and a Majority in Interest of the Investors, the Escrow Agent shall distribute
      the Board Holdback Escrow Amount to the Company. In the event that the Escrow
      Agent does not receive Instructions to Release Board Holdback on or prior to
      the
      125th date after the Closing Date, then upon receipt of written instructions
      from a Majority in Interest of the Investors, the Escrow Agent shall release
      the
      Board Holdback Amount to the Investors, pro rata, based upon the Investment
      Amounts paid by the Investors pursuant to the Securities Purchase
      Agreement.

     

    3.2 CFO
      Holdback Escrow.
      Pursuant to Section 4.12(b) of the Securities Purchase Agreement, the Company
      has undertaken that no later than six (6) months following the Closing Date,
      the
      Company will hire a full-time chief financial officer who has experience as
      the
      chief financial officer of a United States public reporting company and who
      is
      (i) a certified public accountant, (ii) fluent in English, and (iii) an expert
      in (x) GAAP and (y) auditing procedures and compliance for United States public
      companies (such a chief financial officer being referred to as a “Qualified
      CFO”),
      which
      Qualified CFO shall be acceptable to Pope. Pope
      hereby agrees that the Company has complied with this covenant as of the Closing
      Date by virtue of its hiring of Elsa Sung as the Company’s Chief Financial
      Officer. Should the Qualified CFO be dismissed at any time while the Notes
      are
      outstanding, then the Company shall replace the Qualified CFO with a chief
      financial officer who fits the criteria set forth herein as soon as practicable.
      By
      9:00
      a.m. (New York time) on the second Trading Day following the hiring of such
      Qualified CFO, the Company will file a Current Report on Form 8-K disclosing
      the
      information required by Item 5.02 of Form 8-K. Accordingly, $2,000,000
(the
      “CFO
      Holdback Escrow
      Amount”)
      of the
      Escrowed Funds is to be held in the Escrow Account subject to the satisfaction
      of the Company’s obligations under this Section 3.2 and Section 4.12(b) of the
      Securities Purchase Agreement. Upon the Company’s satisfaction of the aforesaid
      obligations in this Section 3.2 and Section 4.12(b) of the Securities Purchase
      Agreement, the Company and a Majority in Interest of the Investors shall execute
      and deliver written instructions with reference to this Section 3.2 to release
      the CFO Holdback Escrow Amount to the Company (“Instructions
      to Release CFO Holdback”).
      Within one (1) Business Day following its receipt of Instructions to Release
      CFO
      Holdback (with wire instructions attached) jointly executed by the Company
      and a
      Majority in Interest of the Investors, the Escrow Agent shall distribute the
      CFO
      Holdback Escrow Amount to the Company. In the event that the Escrow Agent does
      not receive Instructions to Release CFO Holdback on or prior to six (6) months
      after the Closing Date, then upon receipt of written instructions from a
      Majority in Interest of the Investors, the Escrow Agent shall release the CFO
      Holdback Amount to the Investors, pro rata, based upon the Investment Amounts
      paid by the Investors pursuant to the Securities Purchase
      Agreement.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    4.
       Interpleader.
      Should
      any controversy arise among the parties hereto with respect
      to this Agreement or with respect to the right to receive the Escrowed Funds,
      the Escrow Agent shall have the right to consult counsel and/or to institute
      an
      appropriate interpleader
      action to determine the rights of the parties. The Escrow Agent is also
hereby
      authorized to institute an appropriate interpleader action upon receipt of
      a
      written letter of direction executed by the parties so directing the Escrow
      Agent. If the Escrow Agent
      is
      directed to institute an appropriate interpleader action, it shall institute
      such action
      not prior to thirty (30) days after receipt of such letter of direction and
      not
      later than
      sixty (60) days after such date. Any interpleader action instituted in
      accordance with this
      Section 4 shall be filed in any court of competent jurisdiction in New York,
      and
      the portion of the Escrowed Funds in dispute shall be deposited with the court
      and in such event the Escrow Agent shall be relieved of and discharged from
      any
      and all obligations and liabilities under and pursuant to this Agreement with
      respect to that portion of the Escrowed Funds.

     

    

    5.
      Exculpation
      and Indemnification of Escrow Agent

     

    5.1
       The
      Escrow Agent shall have no duties or responsibilities other
      than those expressly set forth herein. The Escrow Agent shall have no
duty
      to
      enforce any obligation of any person other than itself to make any payment
      or
      delivery, or to direct
      or
      cause any payment or delivery to be made, or to enforce any obligation of any
      person
      to
      perform any other act. The Escrow Agent shall be under no liability
      to the other parties hereto or anyone else, by reason of any failure, on the
      part of any
      other
      party hereto or any maker, guarantor, endorser or other signatory of a document
      or any
      other
      person, to perform such person’s obligations under any such document. Except for
      amendments to this Agreement
      referenced below, and except for written instructions given to the Escrow Agent
      by the Company and a Majority in Interest of the Investors relating to the
      Escrowed Funds, the Escrow Agent shall not be obligated to recognize any other
      agreement.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    5.2 The
      Escrow Agent shall not be liable to the Company or to
      anyone
      else for any action taken or omitted by it, or any action suffered by it to
      be
taken
      or
      omitted, in good faith and acting upon any order, notice, demand, certificate,
      opinion
      or advice of counsel (including counsel chosen by the Escrow Agent), statement,
      instrument,
      report, or other paper or document (not only as to its due execution and the
      validity
      and effectiveness of its provisions, but also as to the truth and acceptability
      of any
      information therein contained), which is believed by the Escrow Agent to
be
      genuine and to be signed or presented by the proper person or persons. The
      Escrow Agent
      shall not be bound by any of the terms thereof, unless evidenced by written
      notice delivered
      to the Escrow Agent signed by the proper party or parties and, if the duties
      or
rights
      of
      the Escrow Agent are affected, unless it shall give its prior written consent
      thereto.

     

    5.3
       The
      Escrow Agent shall not be responsible for the sufficiency
      or accuracy of the form, or of the execution, validity, value or genuineness
      of,
any
      document or property received, held or delivered to it hereunder, or of any
      signature or
      endorsement thereon, or for any lack of endorsement thereon, or for any
      description therein;
      nor shall the Escrow Agent or the Investors be responsible or liable to the
      Company or
      to
      anyone else in any respect on account of the identity, authority or rights,
      of
      the person
      executing or delivering or purporting to execute or deliver any document or
      property or this Agreement.
      The
      Escrow Agent shall have no responsibility with respect
      to the use or application of the Escrowed Funds pursuant to the provisions
      hereof.

     

    5.4
       The
      Escrow Agent shall have the right to assume, in the absence of written
notice
      to
      the contrary from the proper person or persons, that a fact or an event, by
      reason of
      which
      an action would or might be taken by the Escrow Agent, does not exist or has
      not
      occurred, without incurring liability to the Company or to anyone else for
      any
      action taken or omitted to be taken or omitted, in good faith and in the
      exercise of its own best judgment, in reliance upon such
      assumption.

    

    5.5 To
      the
      extent that the Escrow Agent becomes liable for the payment of taxes,
      including withholding taxes, in respect of income derived from the investment
      of
the
      Escrowed Funds, or any payment made hereunder, the Escrow Agent may pay such
      taxes;
      and the Escrow Agent may withhold from any payment to the Company of the
      Escrowed Funds such
      amount as the Escrow Agent estimates to be sufficient to provide for the payment
      of such
      taxes not yet paid, and may use the sum withheld for that purpose. The Escrow
      Agent
      shall be indemnified and held harmless by the Company against any liability
      for
      taxes and for any penalties
      in respect of taxes, on such investment income or payments in the manner
provided
      in Section 5.6.

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    5.6 The
      Escrow Agent will be indemnified and held harmless by the Company
      from and against all expenses, including all counsel fees and disbursements,
      or
loss
      suffered by the Escrow Agent in connection with any action, suit or proceedings
      involving
      any claim, or in connection with any claim or demand, which in any way,
directly
      or indirectly, arises out of or relates to this Agreement, the services of
      the
Escrow
      Agent hereunder, except for claims resulting from the gross negligence or
      willful malfeasance of the Escrow Agent or
      breach
      of this Agreement by the Escrow Agent, or the monies or other property
      held by it hereunder. Promptly after the receipt of the Escrow Agent of notice
      of any demand or claim or the commencement of any action, suit or proceeding,
      the Escrow Agent shall, if a claim in respect thereof is to be made against
      the
      Company,
      notify
      it thereof in writing, but the failure by the Escrow Agent to give such notice
      shall
      not
      relieve any such party from any liability which the Company may have to
the
      Escrow Agent hereunder.

     

    5.7 For
      purposes hereof, the term “expense or loss” shall include all amounts
paid
      or
      payable to satisfy any claim, demand or liability, or in settlement of any
      claim, demand, action, suit or proceeding settled with the express written
      consent of the Escrow Agent, and all costs and expenses, including, but not
      limited to, counsel fees and disbursements, paid or incurred in investigating
      or
      defending against any such claim, demand, action, suit or
      proceeding.

     

    6. Resignation
      of Escrow Agent.
      The
      Escrow Agent may resign at any time and be discharged from its duties
      as
      Escrow Agent hereunder by giving the Company and the Investors at least ten
      (10)
      Business Days written
      notice thereof (the “Notice
      Period”).
      As
      soon as practicable after its resignation, the
      Escrow Agent shall, if it receives notice from the Company within the Notice
      Period, turn
      over
      to a successor escrow agent appointed by the Company all Escrowed Funds
(less
      such amount as the Escrow Agent is entitled to retain pursuant to Section 8)
      upon presentation
      of the document appointing the new escrow agent and its acceptance thereof.
      If
      no new
      agent is so appointed within the Notice Period, the Escrow Agent shall return
      the
      Escrowed Funds to or as directed by the Investors who delivered the same,
      without interest or deduction with the understanding that such Escrowed Funds
      will continue to be subject to the provisions of this Agreement.

     

    7. Form
      of Payments by Escrow Agent.

     

    7.1 Any
      payments of the Escrowed Funds by the Escrow Agent pursuant to the
      terms
      of this Agreement
      shall be
      made by wire transfer unless directed to be made by check by the receiving
      party.

     

    7.2 All
      amounts referred to herein are expressed in United States Dollars (US$) and
      all
      payments by the Escrow Agent shall be made in such dollars.

     

    8. Compensation. Escrow
      Agent shall be entitled to the following compensation from
      the
      Company (it being understood that no Investor shall be responsible to pay the
      Escrow Agent any compensation or fees hereunder):

     

    8.1 Documentation
      Fee: The
      Company shall pay a documentation fee to the Escrow
      Agent of $2,000.

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    9. Notices. All
      notices, requests, demands, and other communications provided herein shall
      be in
      writing, shall be delivered by hand or by first-class mail, shall be
deemed
      given when received and shall be addressed to parties hereto at their respective
      addresses All notices, requests, demands and other communications required
      or
      permitted to be given hereunder shall be in writing and shall be deemed to
      have
      been duly given if sent by hand-delivery, by facsimile (followed by first-class
      mail), by nationally recognized overnight courier service or by prepaid
      registered or certified mail, return receipt requested, to the addresses set
      forth below.

     

    If
      to
      Investors:

    

    To
      the
      address set forth on the signature pages hereto. 

    

    With
      a copy to:

    

    Wells,
      Moore, Simmons & Hubbard PLLC

    4550
      Old
      Canton Road STE 200

    P.O.
      Box
      1970

    Jackson,
      MS 39215

    Attn:
      Calvin Wells, Esq

    Fax:
      (601) 355-5850 

    

    If
      to
      the Company:

    

    Genesis
      Pharmaceuticals Enterprises, Inc.

    Middle
      Section, Longmao Street, Area A, Laiyang Waixiangxing Industrial
      Park

    Laiyang
      City, Yantai, Shandong Province, People’s Republic of China 710075

    Attn.:
      President

    Facsimile:
      (954) 727-8448

     

    With
      a copy to:

     

    Loeb
      & Loeb, LLP

    345
      Park
      Avenue

    New
      York,
      New York 10154

    Attn.:
      Mitchell Nussbaum

    Facsimile:
      (212) 407-4097

    

    If
      to
      Escrow Agent:

    

    Loeb
      & Loeb, LLP

    345
      Park
      Avenue

    New
      York,
      New York 10154

    Attn.:
      Mitchell Nussbaum

    Facsimile:
      (212) 407-4097

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    10. Further
      Assurances. From
      time
      to time on and after the date hereof, the Company
      shall deliver or cause to be delivered to the Escrow Agent such further
documents
      and instruments and shall do and cause to be done such further acts as the
      Escrow Agent shall reasonably request (it being understood that the Escrow
      Agent
      shall have
      no
      obligation to make any such request) to carry out more effectively the
      provisions and
      purposes of this Agreement, to evidence compliance herewith or to assure
itself
      that it is protected in acting hereunder.

     

    11. Miscellaneous.

     

    11.1 This
      Agreement shall be construed without regard to any presumption
      or other rule requiring construction against the party causing such instrument
      to be drafted. The terms “hereby,” “hereof,” “hereunder,” and any similar
terms,
      as
      used in this Agreement, refer to the Agreement in its entirety and
      not
      only to the particular portion of this Agreement
      where
      the term is used. The word “person” shall mean any natural person, partnership,
      corporation, government and any other form of business of legal entity. All
      words or terms used in this Agreement,
      regardless of the number or gender in which they were used, shall be deemed
      to
      include any other number and any other gender as the context may require. This
      Agreement
      shall
      not be admissible in evidence to construe the provisions of any prior
      agreement.

     

    11.2 This
      Agreement
      and the
      rights and obligations hereunder of the Company may be assigned by the Company
      only following the prior written consent
      of the Majority in Interest of the Investors.
      This
Agreement
      and the
      rights and obligations hereunder of the Escrow Agent may be assigned by the
      Escrow Agent only with the prior consent
      of the Company and the Majority in Interest of the Investors. An Investor may
      assign its rights under this Agreement without any consent from any other party.
      This
      Agreement
      may not
      be changed orally or modified, amended or supplemented without an express
      written agreement executed by the Escrow Agent, the Company and the Majority
      in Interest of the Investors.
      This
Agreement
      is
      binding upon and intended to be for the sole benefit of the parties hereto
      and
      their
      respective successors, heirs and permitted assigns, and none of the provisions
      of this
      Agreement are intended to be, nor shall they be construed to be, for the
benefit
      of any third person.

     

    11.3 This
      Agreement shall be governed by, and construed in accordance
      with, the internal laws of the State of New
      York.
      The
      representations and warranties contained in this Agreement
      shall
      survive the execution and delivery hereof
      and any investigations made by any party. Each
      party agrees that all legal proceedings concerning the interpretations,
      enforcement and defense of the transactions contemplated by this Agreement
      shall
      be commenced exclusively in the state and federal courts sitting in the City
      of
      New York, Borough of Manhattan (the “New
      York Courts”).
      Each
      party hereto hereby irrevocably submits to the exclusive jurisdiction of the
      New
      York Courts for the adjudication of any dispute hereunder or in connection
      herewith, and hereby irrevocably waives, and agrees not to assert in any such
      proceeding, any claim that it is not personally subject to the jurisdiction
      of
      any such New York Court, or that such proceeding has been commenced in an
      improper or inconvenient forum. Each party hereto hereby irrevocably waives
      personal service of process and consents to process being served in any such
      proceeding by mailing a copy thereof via registered or certified mail or
      overnight delivery (with evidence of delivery) to such party at the address
      in
      effect for notices to it under this Agreement and agrees that such service
      shall
      constitute good and sufficient service of process and notice thereof. Nothing
      contained herein shall be deemed to limit in any way any right to serve process
      in any manner permitted by law. 

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    11.4 This
      Agreement may be executed in a number
      of
      counterparts, by facsimile, each of which shall be deemed to be an original
      as
of
      those
      whose signature appears thereon, and all of which shall together constitute
      one
and
      the
      same instrument. This Agreement shall become binding when one or more of the
      counterparts hereof, individually or taken together, are signed by all the
      parties.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGES FOLLOW]

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have executed and delivered this Agreement on
      the
      day and year first above written.

    

    
      	
              Loeb
                & Loeb LLP, as ESCROW AGENT

            
	 	 
	
              By:

            	
              /s/
                Mitchell Nussbaum

            
	 	
              Name:
                Mitchell Nussbaum

            
	 	
              Title:
                Partner

            
	 	 
	
              GENESIS
                PHARMACEUTICALS ENTERPRISES, INC.

            
	 	 
	
              By:

            	
              /s/
                Cao Wubo

            
	 	
              Name:
                Cao Wubo

            
	 	
              Title:
                Chief Executive Officer

            
	 	 
	
              INVESTORS:

            
	 
	
              [NAME
                OF INVESTOR]

            
	 	 
	
              By:

            	
               

            
	 	
              Name:
                

            
	 	
              Title:

            
	 	 
	
              [NAME
                OF INVESTOR]

            
	 
	
              By:

            	
               

            
	 	
              Name:
                

            
	 	
              Title:

            
	 	 
	
              [NAME
                OF INVESTOR]

            
	 	 
	
              By:

            	
               

            
	 	
              Name:
                

            
	 	
              Title:

            

    

    
      
        
        

      

      
        9Unassociated Document

    REGISTRATION
      RIGHTS AGREEMENT

     

    This
      Registration Rights Agreement (this "Agreement")
      is made
      and entered into as of May 30, 2008, by and among Genesis
      Pharmaceuticals Enterprises, Inc. (f/k/a Genesis Technology Group, Inc.), a
      Florida corporation
      (the
"Company"),
      and
      the investors signatory hereto (each a "Investor"
      and
      collectively, the "Investors").

     

    This
      Agreement is made in connection with the Securities Purchase Agreement, dated
      as
      of the date hereof among the Company and the Investors (the "Purchase
      Agreement").
      

     

    The
      Company and the Investors hereby agree as follows: 

     

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

     

    “2008
      Delivery Date”
      means
      the date on which the (i) 2008 Make Good Shares are required to be delivered
      to
      the Investors pursuant to the Make Good Escrow Agreement and (ii) 2008
      Settlement Shares are required to be delivered to the Investors, if ever 2008
      Settlement Shares are due to be delivered pursuant to the Transaction
      Documents.

     

    “2009
      Delivery Date” means
      the
      date on which the (i) 2009 Make Good Shares are required to be delivered to
      the
      Investors pursuant to the Make Good Escrow Agreement and (ii) 2009 Settlement
      Shares are required to be delivered to the Investors, if ever 2009 Settlement
      Shares are due to be delivered pursuant to the Transaction
      Documents.

     

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

     

    "Commission
      Comments" means
      written comments pertaining
      solely to Rule 415 which
      are
      received by the Company from the Commission to a filed Registration Statement,
      a
      copy of which shall have been provided by the Company to the Holders, which
      either (i) requires the Company to limit the number of Registrable Securities
      which may be included therein to a number which is less than the number sought
      to be included thereon as filed with the Commission or (ii) requires the Company
      to either exclude Registrable Securities held by specified Holders or deem
      such
      Holders to be underwriters with respect to Registrable Securities they seek
      to
      include in such Registration Statement.

     

    “Conversion
      Shares”
      means
      the shares of Common Stock issuable upon conversion of the Notes.

     

    “Cut
      Back Shares”
has
      the
      meaning set forth in Section 2(b).

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    "Effective
      Date"
      means,
      as to a Registration Statement, the date on which such Registration Statement
      is
      first declared effective by the Commission.

     

    “Effectiveness
      Date”
      means
      (a) with respect to the initial Registration Statement required to be filed
      pursuant to Section 2(a), the earlier of: (i) the 180th
      day
      following the Closing Date and (ii) the fifth Trading Day following the date
      on
      which the Company is notified by the Commission that the initial Registration
      Statement will not be reviewed or is no longer subject to further review and
      comments; (b) with respect to any additional Registration Statements required
      to
      be filed pursuant to Section 2(a), the earlier of: (i) the 90th
      day
      following the applicable Filing Date for such additional Registration
      Statement(s) and (ii) the fifth Trading Day following the date on which the
      Company is notified by the Commission that the such additional Registration
      Statement(s) will not be reviewed or is no longer subject to further review;
      (c)
      with respect to any additional Registration Statements required to be filed
      solely due to SEC Restrictions, the earlier of: (i) the 90th
      day
      following the applicable Restriction Termination Date and (ii) the fifth Trading
      Day following the date on which the Company is notified by the Commission that
      such Registration Statement will not be reviewed or is no longer subject to
      further review and comments; (d) with respect to a Registration Statement
      required to be filed under Section 2(c), the earlier of: (i) the 60th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock; provided,
      that,
      if the Commission reviews and has written comments to such filed Registration
      Statement that would require the filing of a pre-effective amendment thereto
      with the Commission, then the Effectiveness Date under this clause (d)(i) shall
      be the 90th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock, and (ii) the fifth Trading Day following
      the date on which the Company is notified by the Commission that the
      Registration Statement will not be reviewed or is no longer subject to further
      review and comments; (e) with respect to a Registration Statement required
      to be
      filed under Section 2(d), the earlier of: (i) the 0th
      day
      following the 2008 Delivery Date; provided,
      that,
      if the Commission reviews and has written comments to such filed Registration
      Statement that would require the filing of a pre-effective amendment thereto
      with the Commission, then the Effectiveness Date under this clause (e)(i) shall
      be the 120th
      day
      following the 2008 Delivery Date, and (ii) the fifth Trading Day following
      the
      date on which the Company is notified by the Commission that the Registration
      Statement will not be reviewed or is no longer subject to further review and
      comments and (f) with respect to a Registration Statement required to be filed
      under Section 2(e), the earlier of: (i) the 90h
      day
      following the 2009 Delivery Date; provided,
      that,
      if the Commission reviews and has written comments to such filed Registration
      Statement that would require the filing of a pre-effective amendment thereto
      with the Commission, then the Effectiveness Date under this clause (f)(i) shall
      be the 120th
      day
      following the 2009 Delivery Date, and (ii) the fifth Trading Day following
      the
      date on which the Company is notified by the Commission that the Registration
      Statement will not be reviewed or is no longer subject to further review and
      comments. 

     

    "Effectiveness
      Period"
      means,
      as to any Registration Statement required to be filed pursuant to this
      Agreement, the period commencing on the Effective Date of such Registration
      Statement and ending on the earliest to occur of (a) the second anniversary
      of
      such Effective Date, (b) such time as all of the Registrable Securities covered
      by such Registration Statement have been publicly sold by the Holders of the
      Registrable Securities included therein, or (c) such time as all of the
      Registrable Securities covered by such Registration Statement may be sold by
      the
      Holders without volume restrictions pursuant to Rule 144, in each case as
      determined by the counsel to the Company pursuant to a written opinion letter
      to
      such effect, addressed and acceptable to the Company's transfer agent and the
      affected Holders.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    "Exchange
      Act"
      means
      the Securities Exchange Act of 1934, as amended.

     

    "Filing
      Date"
      means
      (a) with respect to the initial Registration Statement required to be filed
      pursuant to Section 2(a), the 45th
      day
      following the Closing Date; (b) with respect to any additional Registration
      Statements required to be filed pursuant to Section 2(a), the 15th
      day
      following the Effective Date for the last Registration Statement filed pursuant
      to this Agreement under Section 2(a); (c) with respect to any additional
      Registration Statements required to be filed due to SEC Restrictions, the
      15th
      day
      following the applicable Restriction Termination Date; (d) with respect to
      a
      Registration Statement required to be filed under Section 2(c), the
      30th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock, (e) with respect to the Registration
      Statement required to be filed under Section 2(d), the 45th
      day
      following the 2008 Delivery Date (provided that if the Company is then eligible
      to utilize Form S-3 to register the resale of Common Stock, the Filing Date
      under this clause (e) shall be 30 days following the 2008 Delivery
      Date) and
      (f) with
      respect to the Registration Statement required to be filed under Section 2(f),
      the 45th
      day
      following the 2009 Delivery Date (provided that if the Company is then eligible
      to utilize Form S-3 to register the resale of Common Stock, the Filing Date
      under this clause (f) shall be 30 days following the 2009 Delivery Date).

     

    "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).

     

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

     

    “New
      York Courts”
      means
      the state and federal courts sitting in the City of New York, Borough of
      Manhattan.

     

    “Notes”
      has the
      meaning set forth in recital.

     

    "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.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    “Registrable
      Securities”
      means:
      (i) the Conversion Shares, (ii) the Warrant Shares, (iii) the 2008 Make Good
      Shares, as applicable, (iv) the 2009 Make Good Shares, as applicable (v) the
      Settlement Shares, as applicable, and (vi) any securities issued or issuable
      upon any stock split, dividend or other distribution, recapitalization or
      similar event, or any price adjustment as a result of such stock splits, reverse
      stock splits or similar events with respect to any of the securities referenced
      in (i), (ii), (iii), (iv) or (v) above.

     

    "Registration
      Statement"
      means
      the initial registration statement required to be filed in accordance with
      Section 2(a) and any additional registration statements required to be filed
      under this Agreement, including in each case the Prospectus, amendments and
      supplements to such registration statements or Prospectus, including pre- and
      post-effective amendments, all exhibits thereto, and all material incorporated
      by reference or deemed to be incorporated by reference therein.

     

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

     

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

     

    "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
      Restrictions”
has
      the
      meaning set forth in Section 2(b).

     

    "Securities
      Act"
      means
      the Securities Act of 1933, as amended.

     

    “Warrants”
      means
      the Class A Warrants issued to the Investors pursuant to the Purchase
      Agreement.

     

    “Warrant
      Shares”
means
      the shares of Common Stock issuable upon exercise of the Warrants.

     

    2. Registration.

     

    (a) On
      or
      prior to the applicable Filing Date, the Company shall prepare and file with
      the
      Commission a Registration Statement covering the resale of all Registrable
      Securities (other than in the case of the initial Registration Statement to
      be
      filed under this Section 2(a), the 2008 Make Good Shares, the 2009 Make Good
      Shares and any Settlement Shares) not already covered by an existing and
      effective Registration Statement for an offering to be made on a continuous
      basis pursuant to Rule 415. Each Registration Statement required to be filed
      under this Agreement shall be filed on Form S-1 (or on such other form
      appropriate for such purpose) and contain (except if otherwise required pursuant
      to written comments received from the Commission upon a review of such
      Registration Statement, other than as to the characterization of any Holder
      as
      an underwriter, which shall not occur without such Holder’s written consent) the
      "Plan of Distribution" attached hereto as Annex
      A.
      The
      Company shall cause each Registration Statement required to be filed under
      this
      Agreement to be declared effective under the Securities Act as
      soon as
      possible but, in any event, no later than its Effectiveness Date, and shall
      use
      its reasonable best efforts to keep each such Registration Statement
      continuously effective during its entire Effectiveness Period. By 5:00 p.m.
      (New
      York City time) on the Business Day immediately following the Effective Date
      of
      each Registration Statement, the Company shall file with the Commission in
      accordance with Rule 424 under the Securities Act the final prospectus to be
      used in connection with sales pursuant to such Registration Statement (whether
      or not such filing is technically required under such Rule). If for any reason
      other than due solely to SEC Restrictions, a Registration Statement is effective
      but not all outstanding Registrable Securities are registered for resale
      pursuant thereto, then the Company shall prepare and file by the applicable
      Filing Date an additional Registration Statement to register the resale of
      all
      such unregistered Registrable Securities for an offering to be made on a
      continuous basis pursuant to Rule 415. 

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (b) Notwithstanding
      anything to the contrary contained in this Section 2, if the Company receives
      Commission Comments, and following discussions with and responses to the
      Commission in which the Company uses its reasonable best efforts and time to
      cause as many Registrable Securities (other
      than the 2008
      Make
      Good Shares, 2009
      Make
      Good Shares and any Settlement Shares, unless the 2008
      Delivery
      Date or the 2009
      Delivery
      Date, as the case may be, shall have occurred) for
      as
      many Holders as possible to be included in the Registration Statement filed
      pursuant to Section 2(a) without characterizing any Holder as an underwriter
      (and in such regard uses its reasonable best efforts to cause the Commission
      to
      permit the affected Holders or their respective counsel to participate in
      Commission conversations on such issue together with Company U.S. Counsel,
      and
      timely conveys relevant information concerning such issue with the affected
      Holders or their respective counsel), the Company is unable to cause the
      inclusion of all Registrable Securities, then the Company may, following not
      less than three (3) Trading Days prior written notice to the Holders (i) remove
      from the Registration Statement such Registrable Securities (the “Cut
      Back Shares”)
      and/or
      (ii) agree to such restrictions and limitations on the registration and resale
      of the Registrable Securities, in each case as the Commission may require in
      order for the Commission to allow such Registration Statement to become
      effective; provided,
      that in
      no event may the Company name any Holder as an underwriter without such Holder’s
      prior written consent (collectively, the “SEC
      Restrictions”).
      Unless the SEC Restrictions otherwise require, any cut-back imposed pursuant
      to
      this Section 2(b) shall be allocated first (i) among any securities of the
      Company to be included in such Registration Statement pursuant to Section 6(b)
      and second (ii) among the Registrable Securities of the Holders on a pro
      rata basis. No liquidated damages under Section 2(f) shall accrue on or as
      to
      any Cut Back Shares, and the required Effectiveness Date for such Registration
      Statement will be tolled, until such time as the Company is able to effect
      the
      registration of the Cut Back Shares in accordance with any SEC Restrictions
      (such date, the “Restriction
      Termination Date”).
      From
      and after the Restriction Termination Date, all provisions of this Section
      2
      (including, without limitation, the liquidated damages provisions, subject
      to
      tolling as provided above) shall again be applicable to the Cut Back Shares
      (which, for avoidance of doubt, retain their character as “Registrable
      Securities”) so that the Company will be required to file with and cause to be
      declared effective by the Commission such additional Registration Statements
      in
      the time frames set forth herein as necessary to ultimately cause to be covered
      by effective Registration Statements all Registrable Securities (if such
      Registrable Securities cannot at such time be resold by the Holders thereof
      without volume limitations pursuant to Rule 144).

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    (c) Promptly
      following any date on which the Company becomes eligible to use a registration
      statement on Form S-3 to register Registrable Securities for resale, the Company
      shall file a Registration Statement on Form S-3 covering all such Registrable
      Securities (or a post-effective amendment on Form S-3 to the then effective
      Registration Statement) and shall cause such Registration Statement to be filed
      by the Filing Date for such Registration Statement and declared effective under
      the Securities Act as soon as possible thereafter, but in any event prior to
      the
      Effectiveness Date therefor. Such
      Registration Statement shall contain (except if otherwise required pursuant
      to
      written comments received from the Commission upon a review of such Registration
      Statement, other than as to the characterization of any Holder as an
      underwriter, which shall not occur without such Holder’s consent) the “Plan of
      Distribution” attached hereto as Annex
      A.
      The
      Company shall use its reasonable best efforts to keep such Registration
      Statement continuously effective under the Securities Act during the entire
      Effectiveness Period. By 5:00 p.m. (New York City time) on the Business Day
      immediately following the Effective Date of such Registration Statement, the
      Company shall file with the Commission in accordance with Rule 424 under the
      Securities Act the final prospectus to be used in connection with sales pursuant
      to such Registration Statement (whether or not such filing is technically
      required under such Rule).

     

    (d) On
      or
      prior to the applicable Filing Date, the Company shall prepare and file with
      the
      Commission a Registration Statement covering the resale of the 2008 Make Good
      Shares and the 2008 Settlement Shares, as applicable, on Form S-3 if the Company
      is then eligible to utilize such Form (or on such other form appropriate for
      such purpose) and shall cause such Registration Statement to be filed by the
      Filing Date for such Registration Statement and declared effective under the
      Securities Act as soon as possible thereafter, but in any event prior to the
      Effectiveness Date therefor. Such Registration Statement shall contain (except
      if otherwise required pursuant to written comments received from the Commission
      upon a review of such Registration Statement, other than as to the
      characterization of any Holder as an underwriter, which shall not occur without
      such Holder’s consent) the “Plan of Distribution” attached hereto as
Annex
      A.
      The
      Company shall use its reasonable best efforts to keep such Registration
      Statement continuously effective under the Securities Act during the entire
      Effectiveness Period which is applicable to it. By 5:00 p.m. (New York City
      time) on the Business Day immediately following the Effective Date of such
      Registration Statement, the Company shall file with the Commission in accordance
      with Rule 424 under the Securities Act the final prospectus to be used in
      connection with sales pursuant to such Registration Statement (whether or not
      such filing is technically required under such Rule).

     

    (e) On
      or
      prior to the applicable Filing Date, the Company shall prepare and file with
      the
      Commission a Registration Statement covering the resale of the 2009 Make Good
      Shares and the 2009 Settlement Shares, as applicable, on Form S-3 if the Company
      is then eligible to utilize such Form (or on such other form appropriate for
      such purpose) and shall cause such Registration Statement to be filed by the
      Filing Date for such Registration Statement and declared effective under the
      Securities Act as soon as possible thereafter, but in any event prior to the
      Effectiveness Date therefor. Such Registration Statement shall contain (except
      if otherwise required pursuant to written comments received from the Commission
      upon a review of such Registration Statement, other than as to the
      characterization of any Holder as an underwriter, which shall not occur without
      such Holder’s consent) the “Plan of Distribution” attached hereto as
Annex
      A.
      The
      Company shall use its reasonable best efforts to keep such Registration
      Statement continuously effective under the Securities Act during the entire
      Effectiveness Period which is applicable to it. By 5:00 p.m. (New York City
      time) on the Business Day immediately following the Effective Date of such
      Registration Statement, the Company shall file with the Commission in accordance
      with Rule 424 under the Securities Act the final prospectus to be used in
      connection with sales pursuant to such Registration Statement (whether or not
      such filing is technically required under such Rule).

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    (f) If:
      (i) a
      Registration Statement is not filed on or prior to its Filing Date covering
      the
      Registrable Securities required under this Agreement to
      be
      included therein (if the Company files a Registration Statement without
      affording the Holders the opportunity to review and comment on the same as
      required by Section 3(a) hereof, the Company shall not be deemed to have
      satisfied this clause (i)), or (ii) a Registration Statement is not declared
      effective by the Commission on or prior to its required Effectiveness Date
      or if
      by the Business Day immediately following the Effective Date, the Company shall
      not have filed a “final” prospectus for the Registration Statement with the
      Commission under Rule 424(b) in accordance with the terms hereof (whether or
      not
      such a prospectus is technically required by such Rule), or (iii) after its
      Effective Date, without regard for the reason thereunder or efforts therefor,
      such Registration Statement ceases for any reason to be effective and available
      to the Holders as to all Registrable Securities to which it is required to
      cover
      at any time prior to the expiration of its Effectiveness Period for more than
      an
      aggregate of 30 Trading Days (which need not be consecutive) (any such failure
      or breach 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 which such 30 Trading Day-period is exceeded,
      being referred to as "Event
      Date"),
      then
      in addition to any other rights the Holders may have hereunder or under
      applicable law, on each such Event Date and on each monthly anniversary of
      each
      such Event Date (if the applicable Event shall not have been cured by such
      date)
      until the applicable Event is cured, the Company shall pay to each Holder an
      amount in cash, as partial liquidated damages and not as a penalty, equal to
      1.0% of the aggregate Investment Amount paid by such Holder pursuant to the
      Purchase Agreement. The parties agree that in no event will the Company be
      liable for liquidated damages under this Agreement in excess of 1.0% of the
      aggregate Investment Amount of the Holders in any 30-day period and the maximum
      aggregate liquidated damages payable to a Holder under this Agreement shall
      be
      ten percent (10%) of the aggregate Investment Amount paid by such Holder
      pursuant to the Purchase Agreement. The partial liquidated damages pursuant
      to
      the terms hereof shall apply on a daily pro-rata basis for any portion of a
      month prior to the cure of an Event (except in the case of the first Event
      Date), and shall cease to accrue (unless earlier cured) upon the expiration
      of
      the Effectiveness Period. 

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    (g) Each
      Holder agrees to furnish to the Company a completed Questionnaire in the form
      attached to this Agreement as Annex
      B
      (a
“Selling
      Holder Questionnaire”).
      The
      Company shall not be required to include the Registrable Securities of a Holder
      in a Registration Statement and shall not be required to pay any liquidated
      or
      other damages under Section 2(f) to any Holder who fails to furnish to the
      Company a fully completed Selling Holder Questionnaire at least five Trading
      Days prior to the Filing Date (subject to the requirements set forth in Section
      3(a)).

     

    3. Registration
      Procedures.

     

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

     

    (a) Not
      less
      than three Trading Days prior to the filing of a Registration Statement or
      any
      related Prospectus or any amendment or supplement thereto, the Company shall
      furnish to each Holder copies of the “Selling Stockholders” section of such
      document, the “Plan of Distribution” and any risk factor contained in such
      document that addresses specifically this transaction or the Selling
      Stockholders, as proposed to be filed, which documents will be subject to the
      review of such Holder. The Company shall not file a Registration Statement,
      any
      Prospectus or any amendments or supplements thereto in which the “Selling
      Stockholder” section thereof differs from the disclosure received from a Holder
      in its Selling Holder Questionnaire (as amended or supplemented). The Company
      shall not file a Registration Statement, any Prospectus or any amendments or
      supplements thereto in which it (i) characterizes any Holder as an
      underwriter or (ii) reduces the number of Registrable Securities being
      registered on behalf of a Holder except pursuant to, in the case of subsection
      (ii), the Commission Comments, without, in each case, such Holder’s express
      written authorization.

     

    (b) (i)
      Prepare and file with the Commission such amendments, including post-effective
      amendments, 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 and prepare and file with the Commission such additional Registration
      Statements in order to register for resale under the Securities Act all of
      the
      Registrable Securities; (ii) cause the related Prospectus to be amended or
      supplemented by any required Prospectus supplement, and as so supplemented
      or
      amended to be filed pursuant to Rule 424; (iii) respond as promptly as
      reasonably possible to any comments received from the Commission with respect
      to
      each Registration Statement or any amendment thereto and (iv) comply in all
      material respects with the provisions of the Securities Act and the Exchange
      Act
      with respect to the Registration Statement(s) and the disposition of all
      Registrable Securities covered by each Registration Statement.

     

    (c) Notify
      the Holders as promptly as reasonably possible (and, in the case of (i)(A)
      below, not less than three Trading Days 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 such Registration Statement
      (the
      Company shall provide true and complete copies thereof and all written responses
      thereto to each of the Holders that pertain to the Holders as a Selling
      Stockholder or to the Plan of Distribution, but not information which 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; (iii) of
      the
      issuance by the Commission 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; and (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 light of the circumstances under which they were made, not
      misleading.

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    (d) Use
      its
      reasonable best 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, at the earliest practicable moment.

     

    (e) Furnish
      to each 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) promptly after the filing
      of
      such documents with the Commission.

     

    (f) Promptly
      deliver to each Holder, without charge, as many copies of each Prospectus or
      Prospectuses (including each form of prospectus) and each amendment or
      supplement thereto as such Persons may reasonably request. The Company hereby
      consents to the use of such Prospectus and each amendment or supplement thereto
      by each of the selling Holders in connection with the offering and sale of
      the
      Registrable Securities covered by such Prospectus and any amendment or
      supplement thereto.

     

    (g) Prior
      to
      any public offering of Registrable Securities, register or qualify such
      Registrable Securities for offer and sale under the securities or Blue Sky
      laws
      of all jurisdictions within the United States as any Holder may request, to
      keep
      each such registration or qualification (or exemption therefrom) effective
      during the Effectiveness Period and to do any and all other acts or things
      necessary or advisable to enable the disposition in such jurisdictions of the
      Registrable Securities covered by the Registration Statement(s).

     

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

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    (i) Upon
      the
      occurrence of any event contemplated by Section 3(c)(v), as promptly as
      reasonably possible, 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
      light of the circumstances under which they were made, not
      misleading.

    

    4. Registration
      Expenses.
      All
      fees and expenses incident to the performance of or compliance with this
      Agreement by the Company shall be borne by the Company whether or not any
      Registrable Securities are sold pursuant to a Registration Statement. The fees
      and expenses referred to in the foregoing sentence shall include, without
      limitation, (i) all registration and filing fees (including, without limitation,
      fees and expenses (A) with respect to filings required to be made with any
      Trading Market on which the Common Stock is then listed for trading, and (B)
      in
      compliance with applicable state securities or Blue Sky laws), (ii) printing
      expenses (including, without limitation, expenses of printing certificates
      for
      Registrable Securities and of printing prospectuses if the printing of
      prospectuses is reasonably requested by the holders of a majority of the
      Registrable Securities included in the Registration Statement), (iii) messenger,
      telephone and delivery expenses, (iv) fees and disbursements of counsel for
      the
      Company, (v) Securities Act liability insurance, if the Company so desires
      such
      insurance, and (vi) 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.

     

    5. Indemnification.

     

    (a) Indemnification
      by the Company.
      The
      Company shall, notwithstanding any termination of this Agreement, indemnify
      and
      hold harmless each Holder, the officers, directors, agents, investment advisors,
      partners, members 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, agents and employees of
      each such controlling Person, to the fullest extent permitted by applicable
      law,
      from and against any and all losses, claims, damages, liabilities, costs
      (including, without limitation, reasonable costs of preparation and reasonable
      attorneys' fees) and expenses (collectively, "Losses"),
      as
      incurred, arising out of or relating to 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 form of prospectus
      or
      supplement thereto, in light of the circumstances under which they were made)
      not misleading, except to the extent, but only to the extent, that (1) such
      untrue statements or omissions are based solely upon information regarding
      such
      Holder furnished in writing to the Company by such Holder expressly for use
      therein, or to the extent that such information relates to such Holder or such
      Holder's proposed method of distribution of Registrable Securities and was
      reviewed and expressly approved in writing by such Holder expressly for use
      in
      the Registration Statement, such Prospectus or such form of Prospectus or in
      any
      amendment or supplement thereto (it being understood that the Holder has
      approved Annex A hereto for this purpose) or (2) in the case of an occurrence
      of
      an event of the type specified in Section 3(c)(ii)-(v), 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 an Advice or an amended or supplemented Prospectus,
      but only if and to the extent that following the receipt of the Advice or the
      amended or supplemented Prospectus the misstatement or omission giving rise
      to
      such Loss would have been corrected. The Company shall notify the Holders
      promptly of the institution, threat or assertion of any Proceeding of which
      the
      Company is aware in connection with the transactions contemplated by this
      Agreement.

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    (b) Indemnification
      by Holders.
      Each
      Holder shall, severally and not jointly, indemnify and hold harmless the
      Company, its directors, officers, agents and employees, each Person who controls
      the Company (within the meaning of Section 15 of the Securities Act and Section
      20 of the Exchange Act), and the directors, officers, agents or employees of
      such controlling Persons, to the fullest extent permitted by applicable law,
      from and against all Losses, as incurred, arising solely out of or based solely
      upon: (x) such Holder's failure to comply with the prospectus delivery
      requirements of the Securities Act or (y) any untrue statement of a material
      fact contained in any Registration Statement, any Prospectus, or any form of
      prospectus, or in any amendment or supplement thereto, or arising solely out
      of
      or based solely upon any omission of a material fact required to be stated
      therein or necessary to make the statements therein not misleading to the
      extent, but only to the extent that, (1) such untrue statements or omissions
      are
      based solely upon information regarding such Holder furnished in writing to
      the
      Company by such Holder expressly for use therein, or to the extent that such
      information relates to such Holder or such Holder's proposed method of
      distribution of Registrable Securities and was reviewed by such Holder expressly
      for use in the Registration Statement (it being understood that the Holder
      has
      approved Annex A hereto for this purpose), such Prospectus or such form of
      Prospectus or in any amendment or supplement thereto or (2) in the case of
      an
      occurrence of an event of the type specified in Section 3(c)(ii)-(v), 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 an Advice or an amended or supplemented
      Prospectus, but only if and to the extent that following the receipt of the
      Advice or the amended or supplemented Prospectus the misstatement or omission
      giving rise to such Loss would have been corrected.

     

    (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 assume the defense thereof, including
      the employment of counsel reasonably satisfactory to the Indemnified Party
      and
      the payment of all fees and expenses incurred in connection with defense
      thereof; provided, that the failure of any Indemnified Party to give such notice
      shall not relieve the Indemnifying Party of its obligations or liabilities
      pursuant to this Agreement, except (and only) to the extent that it shall be
      finally determined by a court of competent jurisdiction (which determination
      is
      not subject to appeal or further review) that such failure shall have
      proximately and materially adversely prejudiced the Indemnifying
      Party.

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    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 a conflict of interest is likely to exist if the same counsel
      were to represent such Indemnified Party and the Indemnifying Party (in which
      case, if such Indemnified Party notifies the Indemnifying Party in writing
      that
      it elects to employ separate counsel at the expense of the Indemnifying Party,
      the Indemnifying Party shall not have the right to assume the defense thereof
      and such counsel shall be at the expense of the Indemnifying Party). The
      Indemnifying Party shall not be liable for any settlement of any such Proceeding
      effected without its written consent, which consent shall not be unreasonably
      withheld. 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.

     

    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) shall be paid to
      the
      Indemnified Party, as incurred, within ten Trading Days of written notice
      thereof to the Indemnifying Party (regardless of whether it is ultimately
      determined that an Indemnified Party is not entitled to indemnification
      hereunder; provided, that the Indemnifying Party may require such Indemnified
      Party to undertake to reimburse all such fees and expenses to the extent it
      is
      finally judicially determined that such Indemnified Party is not entitled to
      indemnification hereunder).

     

    (d) Contribution.
      If a
      claim for indemnification under Section 5(a) or 5(b) is unavailable to an
      Indemnified Party (by reason of public policy or otherwise), 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 Section 5(c), any reasonable attorneys' or other reasonable fees or expenses
      incurred by such party in connection with any Proceeding to the extent such
      party would have been indemnified for such fees or expenses if the
      indemnification provided for in this Section was available to such party in
      accordance with its terms.

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    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), no Holder shall be required
      to contribute, in the aggregate, any amount in excess of the amount by which
      the
      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.

     

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

     

    6. 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.
      [Except
      as otherwise provided in the November 2007 Transaction Documents], 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
      during the Effectiveness Period enter into any agreement providing any such
      right to any of its security holders.

     

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

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    (d) Discontinued
      Disposition.
      Each
      Holder agrees by its acquisition of such Registrable Securities that, upon
      receipt of a notice from the Company of the occurrence of any event of the
      kind
      described in Section 3(c), such Holder will forthwith discontinue disposition
      of
      such Registrable Securities under the Registration Statement until such Holder's
      receipt of the copies of the supplemented Prospectus and/or amended Registration
      Statement or until it is advised in writing (the "Advice")
      by the
      Company that the use of the applicable Prospectus may be resumed, and, in either
      case, has received copies of any additional or supplemental filings that are
      incorporated or deemed to be incorporated by reference in such Prospectus or
      Registration Statement. The Company may provide appropriate stop orders to
      enforce the provisions of this paragraph.

     

    (e) Piggy-Back
      Registrations.
      [Except
      as otherwise provided in the November 2007 Transaction Documents], if at any
      time during the Effectiveness Period there is not an effective Registration
      Statement covering all of the Registrable Securities and the Company shall
      determine to prepare and file with the Commission a registration statement
      relating to an offering for its own account or the account of others under
      the
      Securities Act of any of its equity securities, other than on Form S-4 or Form
      S-8 (each as promulgated under the Securities Act) or their then equivalents
      relating to equity securities to be issued solely in connection with any
      acquisition of any entity or business or equity securities issuable in
      connection with stock option or other employee benefit plans, then the Company
      shall send to each Holder written notice of such determination and, if within
      fifteen calendar days after receipt of such notice, any such Holder shall so
      request in writing, the Company shall include in such registration statement
      all
      or any part of such Registrable Securities such holder requests to be
      registered, subject to customary underwriter cutbacks applicable to all holders
      of registration rights.

     

    (f) Amendments
      and Waivers.
      The
      provisions of this Agreement, including the provisions of this Section 6(f),
      may
      not be amended, modified or supplemented, and waivers or consents to departures
      from the provisions hereof may not be given, unless the same shall be in writing
      and signed by the Company and the Holders of no less than a majority in interest
      of the then outstanding Registrable Securities. Notwithstanding the foregoing,
      a
      waiver or consent to depart from the provisions hereof with respect to a matter
      that relates exclusively to the rights of certain Holders and that does not
      directly or indirectly affect the rights of other Holders may be given by
      Holders of at least a majority of the Registrable Securities to which such
      waiver or consent relates; provided,
      further
      that no amendment or waiver to any provision of this Agreement relating to
      naming any Holder or requiring the naming of any Holder as an underwriter may
      be
      effected in any manner without such Holder’s prior written consent. Section 2(a)
      may not be amended or waived except by written consent of each Holder affected
      by such amendment or waiver. 

     

    (g) Notices.
      Any and
      all notices or other communications or deliveries required or permitted to
      be
      provided hereunder shall be in writing and shall be deemed given and effective
      on the earliest of (a) the date of transmission, if such notice or communication
      is delivered via facsimile (provided the sender receives a machine-generated
      confirmation of successful transmission) at the facsimile number specified
      in
      this Section prior to 6:30 p.m. (New York City time) on a Trading Day, (b)
      the
      next Trading Day after the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile number specified in this Section
      on
      a day that is not a Trading Day or later than 6:30 p.m. (New York City time)
      on
      any Trading Day, (c) the Trading Day following the date of mailing, if sent
      by
      U.S. nationally recognized overnight courier service, or (d) upon actual receipt
      by the party to whom such notice is required to be given. The address for such
      notices and communications shall be as follows:

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

    
      	
              If
                to the Company:

            	
              Genesis
                Pharmaceuticals Enterprises, Inc.

            
	 	
              Middle
                Section, Longmao Street, Area A, Laiyang 
Waixiangxing Industrial
                Park

            
	 	
              Laiyang
                City, Yantai, Shandong Province, People’s 
Republic of China
                710075

            
	 	
              Facsimile:
                (954) 727-8448

            
	 	
              Attn.:
                President

            
	 	 
	
              With
                a copy to:

            	
              Loeb
                & Loeb LLP

            
	 	
              345
                Park Avenue

            
	 	
              New
                York, New York, 10154

            
	 	
              Facsimile:
                (212) 407-4990

            
	 	
              Attn.:
                Mitchell Nussbaum

            
	 	 
	
              If
                to an Investor:

               

            	
              To
                the address set forth under such Investor’s name on the 
signature
                pages hereof;

               

            
	
              With
                a copy to

            	 
	
              Lead
                Investor Counsel:

            	
              Wells,
                Moore Simmons & Hubbard PLLC

            
	 	
              4450
                Old Canton Road STE 200

            
	 	
              P.O.
                Box 1970

            
	 	
              Jackson,
                MS 39215

            
	 	
              Facsimile:
                (601) 355-5850 

            
	 	
              Attn.:
                Calvin Wells, Esq .

               

            
	
              If
                to any other Person who is then the registered Holder: 

               

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

            

    

     

    or
      such
      other address as may be designated in writing hereafter, in the same manner,
      by
      such Person.

     

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

     

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

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    (j) Governing
      Law.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Agreement shall be governed by and construed and enforced in accordance
      with the internal laws of the State of New York, without regard to the
      principles of conflicts of law thereof. Each party agrees that all Proceedings
      concerning the interpretations, enforcement and defense of the transactions
      contemplated by this Agreement (whether brought against a party hereto or its
      respective Affiliates, employees or agents) will be commenced in the New York
      Courts. Each party hereto hereby irrevocably submits to the exclusive
      jurisdiction of the New York Courts for the adjudication of any dispute
      hereunder or in connection herewith or with any transaction contemplated hereby
      or discussed herein, and hereby irrevocably waives, and agrees not to assert
      in
      any Proceeding, any claim that it is not personally subject to the jurisdiction
      of any New York Court, or that such Proceeding has been commenced in an improper
      or inconvenient forum. Each party hereto hereby irrevocably waives personal
      service of process and consents to process being served in any such Proceeding
      by mailing a copy thereof via registered or certified mail or overnight delivery
      (with evidence of delivery) to such party at the address in effect for notices
      to it under this Agreement and agrees that such service shall constitute good
      and sufficient service of process and notice thereof. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law. Each party hereto hereby irrevocably waives, to the fullest
      extent permitted by applicable law, any and all right to trial by jury in any
      Proceeding arising out of or relating to this Agreement or the transactions
      contemplated hereby. If either party shall commence a Proceeding to enforce
      any
      provisions of this Agreement, then the prevailing party in such Proceeding
      shall
      be reimbursed by the other party for its attorney’s fees and other costs and
      expenses incurred with the investigation, preparation and prosecution of such
      Proceeding.

     

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

     

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

     

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

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    (n) Independent
      Nature of Investors' Obligations and Rights.
      The
      obligations of each Investor under this Agreement are several and not joint
      with
      the obligations of each other Investor, and no Investor shall be responsible
      in
      any way for the performance of the obligations of any other Investor under
      this
      Agreement. Nothing contained herein or in any Transaction Document, and no
      action taken by any Investor pursuant thereto, shall be deemed to constitute
      the
      Investors as a partnership, an association, a joint venture or any other kind
      of
      entity, or create a presumption that the Investors are in any way acting in
      concert or as a group with respect to such obligations or the transactions
      contemplated by this Agreement or any other Transaction Document. Each Investor
      acknowledges that no other Investor will be acting as agent of such Investor
      in
      enforcing its rights under this Agreement. Each Investor shall be entitled
      to
      independently protect and enforce its rights, including without limitation
      the
      rights arising out of this Agreement, and it shall not be necessary for any
      other Investor to be joined as an additional party in any Proceeding for such
      purpose. The Company acknowledges that each of the Investors has been provided
      with the same Registration Rights Agreement for the purpose of closing a
      transaction with multiple Investors and not because it was required or requested
      to do so by any Investor.

     

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      PAGES FOLLOW]

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

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

     

    
      	
              GENESIS
                PHARMACEUTICALS ENTERPRISES, 
INC.

            
	 	 
	
              By:

            	
              /s/
                Cao Wubo

            
	 	
              Name:
                Cao Wubo

            
	 	
              Title:
                Chief Executive Officer

            

    

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGES OF INVESTORS FOLLOW]

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

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

     

    
      
        	
                
                  NAME
                    OF INVESTING ENTITY

                

              
	
                 

              
	
                 

              
	 
	
                By:

              	 

	 	
                Name:

              
	 	
                Title:

              

      

       

      
        	
                ADDRESS FOR NOTICE

              	 

      

      

      
        	
                c/o:

              	
                 

              

      

      
        	
                Street:

              	
                 

              

      

      
        	
                City/State/Zip:

              	
                 

              

      

      
        	
                Attention:

              	
                 

              

      

      
        	
                Tel:

              	
                 

              

      

      
        	
                Fax:

              	
                 

              
	
                Email: 

              	      

	 	 

      

    

    
      
        	
                
                  NAME
                    OF INVESTING ENTITY

                

              
	
                 

              
	
                 

              
	 
	
                By:

              	 

	 	
                Name:

              
	 	
                Title:

              

      

       

      
        	
                ADDRESS FOR NOTICE

              	 

      

      

      
        	
                c/o:

              	
                 

              

      

      
        	
                Street:

              	
                 

              

      

      
        	
                City/State/Zip:

              	
                 

              

      

      
        	
                Attention:

              	
                 

              

      

      
        	
                Tel:

              	
                 

              

      

      
        	
                Fax:

              	
                 

              
	
                Email: 

              	     
                

      

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    
      
        
          	
                  
                    NAME
                      OF INVESTING ENTITY

                  

                
	
                   

                
	
                   

                
	 
	
                  By:

                	 

	 	
                  Name:

                
	 	
                  Title:

                

        

         

        
          	
                  ADDRESS FOR NOTICE

                	 

        

        

        
          	
                  c/o:

                	
                   

                

        

        
          	
                  Street:

                	
                   

                

        

        
          	
                  City/State/Zip:

                	
                   

                

        

        
          	
                  Attention:

                	
                   

                

        

        
          	
                  Tel:

                	
                   

                

        

        
          	
                  Fax:

                	
                   

                
	
                  Email: 

                	 
	 	 

        

      

      
        
          	
                  
                    NAME
                      OF INVESTING ENTITY

                  

                
	
                   

                
	
                   

                
	 
	
                  By:

                	 

	 	
                  Name:

                
	 	
                  Title:

                

        

         

        
          	
                  ADDRESS FOR NOTICE

                	 

        

        

        
          	
                  c/o:

                	
                   

                

        

        
          	
                  Street:

                	
                   

                

        

        
          	
                  City/State/Zip:

                	
                   

                

        

        
          	
                  Attention:

                	
                   

                

        

        
          	
                  Tel:

                	
                   

                

        

        
          	
                  Fax:

                	
                   

                
	
                  Email: 

                	 

        

      

    

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    Annex
      A

     

    Plan
      of
      Distribution

     

    The
      Selling Stockholders and any of their pledgees, donees, transferees, assignees
      and successors-in-interest may, from time to time, sell any or all of their
      shares of Common Stock on any stock exchange, market or trading facility on
      which the shares are traded or quoted or in private transactions. These sales
      may be at fixed or negotiated prices. 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 Investors;

            

    

     

    
      	
              ·

            	
              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;

            

    

     

    
      	
              ·

            	
              to
                cover short sales made after the date that this Registration Statement
                is
                declared effective by the Commission;

            

    

     

    
      	
              ·

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

            

    

     

    
      	
              ·

            	
              a
                combination of any such methods of sale;
                and

            

    

     

    
      	
              ·

            	
              any
                other method permitted pursuant to applicable
                law.

            

    

     

    The
      Selling Stockholders may also sell shares under Rule 144 under the Securities
      Act, if available, rather than under this prospectus.

     

    Broker-dealers
      engaged by the Selling Stockholders may arrange for other brokers-dealers to
      participate in sales. Broker-dealers may receive commissions or discounts from
      the Selling Stockholders (or, if any broker-dealer acts as agent for the
      purchaser of shares, from the purchaser) in amounts to be negotiated. The
      Selling Stockholders do not expect these commissions and discounts to exceed
      what is customary in the types of transactions involved.

     

    The
      Selling Stockholders may from time to time pledge or grant a security interest
      in some or all of the Notes owned by them and, if they default in the
      performance of their secured obligations, the pledgees or secured parties may
      offer and sell shares of Common Stock from time to time under this prospectus,
      or under an amendment to this prospectus under Rule 424(b)(3) or other
      applicable provision of the Securities Act of 1933 amending the list of selling
      stockholders to include the pledgee, transferee or other successors in interest
      as selling stockholders under this prospectus.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    Upon
      the
      Company 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 addition,
      upon the Company being notified in writing by a Selling Stockholder that a
      donee
      or pledgee intends to sell more than 500 shares of Common Stock, a supplement
      to
      this prospectus will be filed if then required in accordance with applicable
      securities law.

     

    The
      Selling Stockholders also may transfer the shares of Common Stock in other
      circumstances, in which case the transferees, pledgees or other successors
      in
      interest will be the selling beneficial owners for purposes of this
      prospectus.

     

    The
      Selling Stockholders and any broker-dealers or agents that are involved in
      selling the shares may be deemed to be "underwriters" within the meaning of
      the
      Securities Act in connection with such sales. In such event, any commissions
      received by such broker-dealers or agents and any profit on the resale of the
      shares purchased by them may be deemed to be underwriting commissions or
      discounts under the Securities Act. Discounts, concessions, commissions and
      similar selling expenses, if any, that can be attributed to the sale of
      Securities will be paid by the Selling Stockholder and/or the purchasers. Each
      Selling Stockholder has represented and warranted to the Company that it
      acquired the securities subject to this Registration Statement in the ordinary
      course of such Selling Stockholder’s business and, at the time of its purchase
      of such securities such Selling Stockholder had no agreements or understandings,
      directly or indirectly, with any person to distribute any such securities.
      

     

    The
      Company has advised each Selling Stockholder that it may not use shares
      registered on this Registration Statement to cover short sales of Common Stock
      made prior to the date on which this Registration Statement shall have been
      declared effective by the Commission. If a Selling Stockholder uses this
      prospectus for any sale of the Common Stock, it will be subject to the
      prospectus delivery requirements of the Securities Act. The Selling Stockholders
      will be responsible to comply with the applicable provisions of the Securities
      Act and Exchange Act, and the rules and regulations thereunder promulgated,
      including, without limitation, Regulation M, as applicable to such Selling
      Stockholders in connection with resales of their respective shares under this
      Registration Statement.

     

    The
      Company is required to pay all fees and expenses incident to the registration
      of
      the shares, but the Company will not receive any proceeds from the sale of
      the
      Common Stock. The Company has agreed to indemnify the Selling Stockholders
      against certain losses, claims, damages and liabilities, including liabilities
      under the Securities Act. 

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    Annex
      B

     

    GENESIS
      PHARMACEUTICALS ENTERPRISES, INC.

     

    Selling
      Securityholder Notice and Questionnaire

     

    The
      undersigned beneficial owner of common stock (the “Common
      Stock”),
      of
      Genesis Pharmaceuticals Enterprises, Inc., a Florida corporation (the
“Company”),
      understands that the Company has filed or intends to file with the Securities
      and Exchange Commission (the “Commission”)
      a
      Registration Statement for the registration and resale of the Registrable
      Securities, in accordance with the terms of the Registration Rights Agreement,
      dated as of January __, 2008 (the “Registration
      Rights Agreement”),
      among
      the Company and the Investors named therein. A copy of the Registration Rights
      Agreement is available from the Company upon request at the address set forth
      below. All capitalized terms used and not otherwise defined herein shall have
      the meanings ascribed thereto in the Registration Rights Agreement.

     

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

     

    QUESTIONNAIRE

     

    1. Name.

     

    
      	 	
              (a)

            	
              Full
                Legal Name of Selling
                Securityholder

            

    

     

    
      	 
	 

    

    

    
      	 	
              (b)

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

            

    

     

    
      	 
	 

    

    

    
      	 	
              (c)

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

            

    

     

    
      	 
	 

    

     

    2.
      Address for Notices to Selling Securityholder:

     

    
      	 
	 
	 

    

    
      	
              Telephone: 

            	 

    

    
      	
              Fax: 

            	 

    

    
      	
              Contact Person: 

            	 

    

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    3.
      Beneficial Ownership of Registrable Securities:

     

    
      	 	 	
              Type
                and Principal Amount of Registrable Securities beneficially
                owned:

            

    

     

    
      	 
	 
	 
	 

    

     

    4.
      Broker-Dealer Status:

     

    
      	 	
              (a)

            	
              Are
                you a broker-dealer?

            

    

     

    Yes   o     No 
      o

     

    
      	 	
              Note:

            	
              If
                yes, the Commission’s staff has indicated that you should be identified as
                an underwriter in the Registration
                Statement.

            

    

     

    
      	 	
              (b)

            	
              Are
                you an affiliate of a
                broker-dealer?

            

    

     

    Yes   o     No 
      o

     

    
      	 	
              (c)

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

            

    

     

    Yes   o     No 
      o

     

    
      	 	
              Note:

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

            

    

     

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

     

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

     

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

            

    

     

    
      	 
	 
	 

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    6.
      Relationships with the Company:

     

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

     

    State
      any
      exceptions here:

     

    
      	 
	 
	 

    

     

    7.
      The
      Company has advised each Selling Stockholder that it may not use shares
      registered on the Registration Statement to cover short sales of Common Stock
      made prior to the date on which the Registration Statement is declared effective
      by the Commission, in accordance with 1997 Securities and Exchange Commission
      Manual of Publicly Available Telephone Interpretations Section A.65. If a
      Selling Stockholder uses the prospectus for any sale of the Common Stock, it
      will be subject to the prospectus delivery requirements of the Securities Act.
      The Selling Stockholders will be responsible to comply with the applicable
      provisions of the Securities Act and Exchange Act, and the rules and regulations
      thereunder promulgated, including, without limitation, Regulation M, as
      applicable to such Selling Stockholders in connection with resales of their
      respective shares under the Registration Statement.

     

    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 for the Registration Statement.

     

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

     

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

     

    
      	
              Dated:
                

            	
               

            	 	
              Beneficial Owner: 

            	
               

            

    

    

    
      	
              By:

            	
               

            
	 	
              Name:

            
	 	
              Title:

            

    

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

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

    

    [                  ]

    
      
        
        

      

      
        26

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