Document:

exhibit10-3.htm

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    SUBSCRIPTION
AGREEMENT

    

    

    TO:          PNG
Ventures, Inc.

    2038
Corte Del Nogal, Suite 110

    Carlsbad,
California  92011

    Attention:
Mark Baum, Esq.

    

    Ladies
and Gentlemen:

    

    The undersigned (the “Subscriber”)
hereby tenders Subscriber’s subscription to PNG Ventures, Inc., a Delaware
corporation (the “Company”), on the terms and conditions hereinafter set
forth:

    

    1.           DEFINITIONS

    

    1.1           “Effective
Date” shall mean June __, 2008.

    

    1.2           “Subscriber
Shares” are the number of shares of Common Stock to be issued to Subscriber
pursuant to this Subscription Agreement.

    

    1.3           “Exchange
Agreement” shall mean that certain Share Exchange Agreement among Earth
Biofuels, Earth LNG, Inc., New Earth LNG, Inc. and its subsidiaries and the
Company dated as of the Effective Date.

    

    1.4           “Credit
Agreement” shall mean that certain Amended and Restated Credit Agreement dated
as of the Effective Date between New Earth LNG, Subscriber and the other parties
listed therein, whereby New Earth LNG, as a subsidiary of the Company, will be
primary borrower.

    

    1.5           “Master
Rights Agreement” shall mean that certain Master Rights Agreement between the
Company and Subscriber regarding certain registration and other rights related
to the Subscriber Shares.

    

    1.6           “Earth
Biofuels” shall mean Earth Biofuels, Inc.

    

    1.7           “New
Earth LNG” shall mean New Earth LNG, Inc., a Delaware Corporation.

    

    1.8           “Common
Stock” shall mean the common stock of the Company, $.001 par value per
share.

    

    1.9           “Securities
Act” shall mean the Securities Act of 1933, as amended.

     

    1.10           “Subscription
Agreement” shall mean this Subscription Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    1.11           “Affiliate”
shall mean and any individual, corporation, partnership, association, or
business that directly or indirectly through intermediaries, controls, is
controlled by or is under common control with Subscriber.

    

    1.12           “Commission”
shall mean the Securities and Exchange Commission.

    

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

    

    
      	
              2.

            	
              SUBSCRIBER
      SHARES

            

    

    

    2.1           Subscription.  Subscriber
hereby irrevocably subscribes for 1,100,000 shares of Common Stock
(the “Subscriber Shares”), to be issued to Subscriber upon closing of the
transaction contemplated by the Exchange Agreement and as partial consideration
for the Credit Agreement and the proceeds thereunder.

    

    2.2           Closing.  The
issuance of the Subscriber Shares shall occur contemporaneously with the
execution and delivery of the Credit Agreement, the closing relating to the
Exchange Agreement and Master Rights Agreement at a closing (the “Closing”) to
be held at a time and place agreed upon by the parties.  At the
Closing, Subscriber and the Company shall each deliver an executed copy of this
Subscription Agreement and the Company will deliver to Subscriber a stock
certificate for the Subscriber Shares.

    

    2.3           Transfer.  Subscriber
acknowledges and agrees that Subscriber will not sell, transfer, or otherwise
dispose of the Subscriber Shares unless (i) to an Affiliate, subject to
compliance with federal and state securities laws, (ii) the Company agrees to
such transfer, subject to compliance with federal and state securities laws, or
(iii) the Common Stock is registered under the Securities Act as provided under
the Master Rights Agreement or otherwise, or unless such sale, transfer, or
other disposition would be in compliance with all applicable federal and state
laws and regulations and Subscriber provides the Company with a legal opinion
reasonably acceptable in form and substance stating that such sale, transfer or
other disposition may be made without registration under the Act or under any
applicable state laws and regulations.

    

    
      	
              3.

            	
              REPRESENTATIONS
      AND WARRANTIES OF COMPANY

            

    

    

    The Company represents and warrants to
Subscriber as follows:

    

    3.1           Organization.  The
Company is a corporation duly organized and validly existing under the laws of
the State of Nevada, with full corporate power and authority to conduct its
business as it is now being conducted, to own or use the properties and assets
that it purports to own or use.

    

    3.2           Capitalization.  The
authorized capital stock of the Company consists of Fifty Million (50,000,000)
shares of common stock, $.001 par value per share, of which _______ shares are
issued and outstanding, and 1,900,000 shares of Common Stock are issued
in

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    electronic
form to the Company’s transfer agent as escrow agent, for issuance upon
conversion of the Note (as defined in the Exchange Agreement), no shares are
held in the treasury of the Company.  The Subscriber Shares will
represent approximately 8.66% of the fully diluted shares of Common Stock
immediately following the Closing.  The Subscriber Shares have
been duly authorized for issuance and, when issued in accordance with the terms
of this Subscription Agreement, will be validly issued, fully paid and
nonassessable.  Subscriber will acquire good and valid title to the
Subscriber Shares, free of all claims, liens, options, preemptive rights,
charges, encumbrances, and restrictions of any kind whatsoever, except for
restriction on their transferability under the Securities Act.  All of
the issued and outstanding shares of capital stock of the Company are validly
issued, fully paid and nonassessable and are not subject to, nor were they
issued in violation of, any preemptive rights.  There are no
outstanding options, warrants or other rights, agreements or commitments of any
kind obligating the Company to issue any additional shares of its capital stock,
except as set forth in Section 3.3 of the Exchange Agreement.

    

    3.3           Articles
of Incorporation.  A true and complete copy of each of the
Company’s Articles of Incorporation and Bylaws, as in effect on the Effective
Date, have been provided to Subscriber.

    

    3.4           No
Conflict.  Neither the execution and delivery of this
Subscription Agreement, nor the Master Rights Agreement, nor the transactions
contemplated hereby and thereby, do or will (i) violate any provision of the
Articles of Incorporation or Bylaws of the Company, (ii) violate, contravene or
conflict in any material respect with any resolution adopted by the board of
directors or the shareholders of the Company, (iii) to the knowledge of the
Company, violate any law or order applicable to the Company or any of its
assets, properties or businesses, (iv) result in a breach of, constitute a
default (or an event which, with or without the giving of notice or lapse of
time or both, would become a default) under, require any consent under, or give
to others any right of termination, amendment, acceleration, suspension,
revocation or cancellation of, any material contract or agreement to which the
Company is a party or is bound, or (v) result in the creation of any lien or
encumbrance on any of the Subscriber Shares.

    

    3.5           Authority.  This
Subscription Agreement constitutes the legal, valid and binding obligation of
the Company, enforceable against the Company in accordance with its terms except
as enforceability may be limited by applicable laws relating to bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting creditors’ rights generally and except as such enforceability is
subject to general principles of equity.  The Company has the right,
power, authority and capacity to execute and deliver this Subscription Agreement
and perform its obligations hereunder.

    

    3.6           Litigation.  The
Company is not a party to any material pending litigation or, to its knowledge,
any governmental proceedings are threatened against the Company, other than as
relates to the Settlement Agreement (as defined in the Exchange Agreement), and
related Amended Court Order (as defined in the Exchange Agreement) already
provided to and reviewed by Subscriber.

    

    3.7           Periodic
Reports.  The
Company is current in the filing of all quarterly or annual

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    financial
or reports with the Commission, and has been a reporting company under the
Exchange Act.  All such reports and statements filed by the Company
with the Commission did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstance under which they were made,
not misleading.

    

    
      	
              4.

            	
              REPRESENTATIONS
      AND WARRANTIES OF SUBSCRIBER

            

    

    

    In order to induce the Company to
accept this Subscription Agreement, Subscriber hereby represents and warrants as
follows:

    

    4.1           Access to
Information.

    

    (a)           Documents and
Records.  Subscriber acknowledges that all requested documents,
records, and books pertaining to the Company have been made available for
inspection by Subscriber or its representatives including, without limitation,
the Settlement Agreement and related Amended Court Order, and the Exchange
Agreement.  Subscriber has had a reasonable opportunity to ask
questions of and receive answers from the officers of the Company concerning the
terms and conditions of the offering of the Subscriber Shares, and to obtain
additional information, to the extent possessed or obtainable without
unreasonable effort or expense by the officers of the Company.  All
such questions have been answered to the satisfaction of
Subscriber.

    

    (b)           Experience.  Subscriber
has such knowledge and experience in financial and business matters as to enable
Subscriber to (i) evaluate the merits and risks associated with the purchase of
the Subscriber Shares, and (ii) make an informed decision with respect
thereto.  Subscriber is financially capable of bearing the risk of
loss of any and all consideration paid for the Subscriber Shares, and
acknowledges that an investment in the Subscriber Shares involves a high degree
of risk, including a possible total loss of investment.  Subscriber is
acquiring the Subscriber Shares for its own account, not as a nominee or agent,
and not with a view to, or for sale in connection with, any distribution
thereof. Subscriber understands that the Subscriber Shares has not been
registered under the Securities Act, or any state securities laws, by reason of
specific exemptions from the registration provisions of the Securities Act and
such laws that may depend upon, among other things, the bona fide nature of
Subscribers’ investment intent as expressed herein.

    

    (c)           Accredited
Investor.  Subscriber is an “accredited investor” within the
meaning of Regulation D promulgated by the Commission under the Securities
Act.  Subscriber acknowledges that the Company will rely upon the
representations and warranties made by Subscriber in this Subscription Agreement
in order to establish an exemption from the registration requirements of the
Securities Act and applicable state securities laws and that Company shall place
the legend described in Section 4.2 (the “Legend”) on the certificate
representing the Subscriber Shares to reflect that the Subscriber Shares have
not been registered under the Securities Act and applicable state
laws.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (d)           Transfer.  Subject
to Section 2.3, Subscriber will not transfer any shares of Common Stock without
registration under the Securities Act and applicable state securities laws
unless the transfer is exempt from registration under the Securities Act and
such laws and is made in compliance with the Legend.

    

    (e)           Authorization.  All
action on the part of Subscriber necessary for the authorization, execution,
delivery and performance of all obligations of Subscriber under this
Subscription Agreement have been taken prior to Closing.  This
Subscription Agreement, when executed and delivered by such Subscriber, will
constitute the valid and binding obligation of such Subscriber, except as
enforceability may be limited in accordance with bankruptcy, insolvency or other
laws affecting the enforcement of creditors’ rights generally, and except that
the availability of the remedy of specific performance or other equitable relief
is subject to the discretion of the court before which any proceeding thereof
may be brought.

    

    4.2           Legend.  Subscriber
understands that there will be placed on the certificates for the Subscriber
Shares, when issued and delivered, the Legend, stating in substance as
follows:

    

    
      	
               
      

            	
              “THE
      SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
      SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL A
      REGISTRATION STATEMENT WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER
      SUCH ACT, OR THE ISSUER RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER
      REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER THAT AN EXEMPTION FROM
      THE REGISTRATION REQUIREMENTS OF SUCH ACT IS
  AVAILABLE.”

            

    

    

    
      	
              5.

            	
              GOVERNING
      LAW

            

    

    

    ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS SUBSCRIPTION AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE
OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW
PROVISION OR RULE (WHETHER OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION)
THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE
STATE OF DELAWARE.

    

    6.           ENTIRE AGREEMENT

    

    This Subscription Agreement, the Master
Rights Agreement and all other agreements contemplated by this Subscription
Agreement supersede all prior discussions and agreements between the parties
with respect to the subject matter hereof and thereof and contain the sole and
entire agreement between the parties hereto with respect to the subject matter
hereof and thereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.           NOTICES

    

    All
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Subscription Agreement shall be in writing and
shall be deemed to have been given when delivered personally, mailed by
certified or registered mail, return receipt requested and postage prepaid, or
sent via a nationally recognized overnight courier, or sent via facsimile to the
recipient accompanied by a certified or registered mailing.  Such
notices, demands and other communications shall be sent to the Company and
Subscriber at the addresses set forth below and to the other parties hereto at
such address or to the attention of such other person as is specified in the
Company's books and records:

     

    If to the
Company:

     

    PNG
Ventures, Inc.

    2038
Corte Del Nogal, Suite 110

    Carlsbad,
California  92011

    Attention:
Mark Baum, Esq.

    Tel.
(760) 804-8844 x205

    Facsimile:
(760) 804-8845

    

    with a
copy to:

    

    Hodgson
Russ, LLP

    1540
Broadway, 24th
Floor

    New York,
NY 10036

    Attention:
Ron Levy, Esq.

    Tel.
(212) 751-4300

    Fax.
(212) 751-0928

    Email:
rlevy@hodgsonruss.com

    

    

    If to
Subscriber:

    

    ______________________

    ______________________

    ______________________

    Attention
Tom Quimby

    Tel.
(___) __-___________

    Facsimile:
(___)___-_____

    Email:
tom@medleycapital.com

    

    

    King & Spalding, LLP

    1185 Avenue of the
Americas

    New York, NY 10036

    Attention: Gerald Woods,
Esq.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Tel. (212) 556-2232

    Facsimile: (212) 556-2222

    Email: GWoods@kslaw.com

    

    or such
other address or to the attention of such other Person as the recipient party
shall have specified by prior written notice to the sending party.

    

    7.           WAIVER

    

    Waiver by either party of any term or
provision of this Subscription Agreement shall be in writing and shall not
constitute a continuing waiver thereof nor of any further or additional rights
such party may hold under this Subscription Agreement.

    

    
      	
              8.

            	
              SEVERABILITY

            

    

    

    If any provision of this Subscription
Agreement shall be held to be invalid, illegal or unenforceable, the validity,
legality or enforceability of the remaining provisions shall not in any way be
affected or impaired.

    

    
      	
              9.

            	
              CUMULATIVE
      RIGHTS

            

    

    

    Unless expressly stated to the contrary
elsewhere in this Subscription Agreement, all rights, powers and privileges
conferred hereunder upon the parties hereto shall be cumulative and not
restrictive of those given by law.

    

    
      	
              10.

            	
              HEADINGS

            

    

    

    The descriptive headings of this
Subscription Agreement are inserted for convenience only and do not constitute a
part of this Subscription Agreement.

    

    11.           COUNTERPARTS

    

    This Subscription Agreement may be
executed simultaneously in two or more counterparts, any one of which need not
contain the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same agreement.  Facsimile or
scanned and emailed counterparts signatures to this Subscription Agreement shall
be acceptable and binding.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the undersigned has
executed this Subscription Agreement as of the Effective Date.

    

    

    Subscriber:

    

    FOURTH
THIRD LLC

    

    

    By: /s/ Seth R. Taube                                                                                       

    

    Name:   Seth R. Taube                                                        

    

    Title:     Authorized
Signatory                                                                           

    

    

    

    ACCEPTED
AND AGREED TO:

    

    Company:

    

    PNG
VENTURES, INC.

    

    

    By: /s/ Kevin Markey                                                                                             

    

    Name:   Kevin Markey                                                                    

    

    Title:   
Chief Executive
Officerexhibit10-4.htm

    

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      MASTER RIGHTS
AGREEMENT

       

      THIS MASTER RIGHTS AGREEMENT
(this “Agreement”) is made
and entered into as of the 26th day of
June, 2008 (“Effective
Date”) by and among PNG Ventures, Inc., a Nevada corporation (the “Company”), and Fourth
Third LLC, a Delaware limited liability company (“Fourth
Third”).

       

      WHEREAS, the Company is
acquiring from Earth LNG, Inc. (“Seller”) all of the
issued and outstanding membership interests of New Earth LNG, LLC (“Earth LNG”) pursuant
to that certain Share Exchange Agreement dated as of even date herewith (the
“Exchange
Agreement”);

       

      WHEREAS, as a condition to the
closing under the Exchange Agreement, Earth LNG has entered into that certain
Amended and Restated Credit Agreement dated as of even date herewith (the “Credit Agreement”)
with Fourth Third, whereby Earth LNG will receive an aggregate of $34,000,000
(the “Loan
Proceeds”);

       

      WHEREAS, as partial
consideration for the Credit Agreement and the Loan Proceeds, the Company has
issued 1,100,000 shares of Common Stock (the “Shares”) to Fourth
Third;

       

      WHEREAS, the parties have
agreed herewith that, if the Company offers or issues Common Stock for less than
$10.00 per Share or the Common Stock otherwise trades below such price at
certain times as agreed to herein, Fourth Third and the Company desire that the
Company issue to Fourth Third certain  Additional Shares (as
hereinafter defined); and

       

      WHEREAS, in connection with
the closing under the Credit Agreement, Fourth Third and the Company desire to
enter into this Agreement to address the registration rights with respect to the
Shares and the Additional Shares and the issuance to Fourth Third of Additional
Shares as provided herein.

       

      AGREEMENT

       

      NOW THEREFORE, in
consideration of the following mutual covenants and agreements, and subject to
the terms and conditions set forth herein, the parties hereto agree as
follows:

       

      

       

      1.           Definitions.  As
used herein, the following terms shall have the following meanings.

       

      “Additional Shares”
means shares of Common Stock issued to Fourth Third as provided in Section 10
hereof

       

      "Affiliate" means,
with respect to any Person, any other Person controlling, controlled by, or
under common control with such Person.  For purposes of this
Agreement, the term "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with" as used with respect to any
Person) means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person whether
through ownership of voting securities, by contract or otherwise.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Assumed Value” means
$10.00 per Share (as adjusted for stock splits, stock combinations or
consolidations, stock dividends, mergers or similar transactions).

       

      "Common Stock" means,
collectively, (i) the Company's Common Stock, $0.001 par value per share
and (ii) any other class of common stock of the Company, and (iii) any
capital stock of the Company issued or issuable with respect to the securities
referred to in clauses (i) or (ii) above whether by way of a stock dividend or
stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization.

       

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

       

      "Free Writing
Prospectus" means a free-writing prospectus, as defined in Rule 405 of
the Securities Act.

       

      “Holder” shall mean
Fourth Third and its Affiliates or their Permitted Transferees, subject to the
terms of this Agreement

       

      "Permitted Transferee"
means (i) any other Holder; (ii) any Affiliate of any Holder;
(iii) any one or more members of a class consisting of the spouse, children
and grandchildren of a Holder, or a trust for the benefit of any one or more
members of such class; or (iv) any shareholder or partner of any
non-natural Holder upon a pro
rata distribution by such a non-natural Holder to its partners,
shareholders, interest holders or otherwise upon the dissolution or liquidation
of the non-natural Holder.

       

      "Person" means an
individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization or other entity, or a governmental entity (or any department,
agency or political subdivision thereof).

       

      “PIPE Securities” or
“PIPE Offering”
means shares of Common Stock issued to investors in a private placement
financing transaction with net proceeds to the Company of at least $7,500,000,
of which $5,000,000 is applied to reduce the indebtedness under the Credit
Agreement, and which include registration rights with respect
thereto.

       

      “Price Determination
Date” means the date that is the earliest to occur of (i) the closing of
a PIPE Offering, (ii) the date that the indebtedness under the Credit Agreement
is reduced to $30,000,000 or below, and (iii) December [20], 2008, (iv) the date that
a Registration Statement with respect to the Shares is declared
effective.

       

      "Registrable
Securities" means (i) any shares of Common Stock acquired by, issued or
issuable to, or otherwise owned by the Holder, including without limitation, the
Shares and the Additional Shares; and (ii) any shares of capital stock of
the Company issued or issuable with respect to the securities referred to in
clause (i) by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization.  For purposes of this Agreement, a Person will be
deemed to be a holder of Registrable Securities whenever such Person has the
right to acquire directly or indirectly such Registrable Securities (upon
conversion or exercise in connection with a transfer of securities or otherwise,
but disregarding any restrictions or limitations upon the exercise of such
right), whether or not such acquisition has actually been
effected.  Such securities will cease to be Registrable Securities
when and to the extent eligible to be sold pursuant to Rule 144 without
restriction.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      "Registration
Expenses" means all expenses incident to the Company's performance of or
compliance with this Agreement, including without limitation all registration,
qualification and filing fees, fees and expenses of compliance with securities
or blue sky laws, printing expenses, messenger and delivery expenses, fees and
expenses of custodians, and fees and disbursements of counsel for the Company
and all independent certified public accountants, underwriters (excluding
discounts and commissions) and other Persons retained by the
Company.

       

      “Repurchase Amount”
shall be as defined in Section 9.

       

      "Rule 144" means
Rule 144 under the Securities Act (or any similar rule then in
force).

       

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

       

      2.           Short-Form
Registrations.

       

      (a)           Requests for
Registration.  Subject to this Section 2, the
holders of a majority of the Registrable Securities may, at any time or from
time to time after six months following the Effective Date or, if earlier, upon
the grant of similar rights pursuant to the PIPE Offering, request registration,
whether underwritten or otherwise, under the Securities Act of all or part of
their Registrable Securities on Form S-3 or any similar short-form
registration ("Short-Form
Registrations"), if available.  Each request for a Short-Form
Registration shall specify the approximate number of Registrable Securities
requested to be registered and the anticipated per share price range for such
offering.  Within twenty (20) days after receipt of any such request
for a Short-Form Registration, the Company shall give written notice of such
requested registration to all other holders of Registrable Securities and shall
include (subject to the provisions of this Agreement including clause (d) below)
in such registration (and in all related registrations or qualifications under
blue sky laws or in compliance with other registration requirements and in any
related underwriting) all Registrable Securities with respect to which the
Company has received written requests for inclusion therein within twenty (20)
days after the receipt of the Company's notice.

       

      (b)           Short-Form
Registrations.  The holders of a majority of the Registrable
Securities will be entitled to request an unlimited number of Short-Form
Registrations in which the Company shall pay all Registration
Expenses.

       

      (c)           Priority on Short-Form
Registrations.  The Company shall not include in any Short-Form
Registration any securities which are not Registrable Securities (other than
securities owned by the Company which the Company proposes to register or PIPE
Securities) without the prior written consent of the holders of at least a
majority of the Registrable Securities included in such
registration.  If a Short-Form Registration is an underwritten
offering and the managing underwriters advise the Company in writing that in
their opinion the number of Registrable Securities and, if permitted hereunder,
other securities requested to be included in such offering exceeds the number of
Registrable Securities and other securities, if any, which can be sold therein
without adversely affecting the marketability of the offering, the Company shall
include in such registration, (i) first, the number of Registrable
Securities and PIPE Securities requested to be included in such registration
pro rata, if necessary,
among the holders of Registrable Securities and PIPE Securities based on the
number of shares of Registrable Securities or PIPE Securities owned by each such
holder at such time, and (ii) second, any other securities of the Company
requested to be

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      included
in such registration pro
rata, if necessary, on the basis of the number of shares of such other
securities owned by each such holder at such time.

       

      (d)           Restrictions on Short-Form
Registrations.  The Company shall not be obligated to effect
any Short-Form Registration (i) within six (6) months after the effective
date of a previous Short-Form Registration or (ii) if the Company shall
furnish to the holders requesting such Short-Form Registration a certificate
signed by the Company's Chief Executive Officer stating that in the good faith
judgment of the Board of Directors of the Company, it would be materially
harmful to the economic prospects of the Company for such Short-Form
Registration to be effected at such time, in which event the Company shall have
the right to defer such filing for a period of not more than 120 days after
receipt of the initial request for the Short-Form Registration; provided, that such right to
delay a request shall be exercised by the Company not more than once in any
twelve-month period.

       

      (e)           Selection of
Underwriters.  In the case of a Short-Form Registration, the
Company will have the right to select the investment banker(s) and manager(s) to
administer the offering, which investment banker(s) and manager(s) will be
nationally recognized and reasonably acceptable to the holders of a majority of
the Registrable Securities included in such Short-Form
Registration.

       

      3.           Piggyback
Registrations.

       

      (a)           Right to
Piggyback.  Whenever the Company proposes to register any of
its Common Stock under the Securities Act other than pursuant to a Short Form
Registration or a  registration statement on Form S-8 or S-4 or any
similar or successor form and the registration form to be used may be used for
the registration of Registrable Securities (a "Piggyback
Registration"),  the Company shall give prompt written notice
to all holders of Registrable Securities of its intention to effect such a
registration and shall, subject to the provisions of this Agreement including
clauses (c) and (d) below, include in such registration (and in all related
registrations or qualifications under blue sky laws or in compliance with other
registration requirements and in any related underwriting) all Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within twenty (20) days after the receipt of the Company's
notice.

       

      (b)           Priority on Primary
Registrations.  If a Piggyback Registration is an underwritten
primary registration on behalf of the Company, the Company shall include in such
registration all securities requested to be included in such registration; provided, that if the
managing underwriters advise the Company in writing that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without adversely affecting the
marketability of the offering, the Company shall include in such registration
(i) first, the securities the Company proposes to sell, (ii) second,
the number of Registrable Securities and PIPE Securities requested to be
included in such registration by the holders of Registrable Securities and PIPE
Securities, if necessary, pro
rata among the holders of such Registrable Securities and PIPE Securities
on the basis of the number of shares of such Registrable Securities or PIPE
Securities owned by such holder at such time, and (iii) third, any other
securities of the Company requested to be included in such registration pro rata, if necessary, on
the basis of the number of shares of such other securities owned by each such
holder at such time.

       

      (c)           Priority on Secondary
Registrations.  If a Piggyback Registration is an underwritten
secondary registration on behalf of holders of the Company's securities
(which

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      registration
was granted in accordance with Section 2(g) above),
the Company shall include in such registration all securities requested to be
included in such registration; provided, that if the
managing underwriters advise the Company in writing that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without adversely affecting the
marketability of the offering, the Company shall include in such registration
the securities and Registrable Securities and PIPE Securities requested to be
included therein pro
rata, if necessary, among the holders of such securities and Registrable
Securities and PIPE Securities on the basis of the number of securities and
Registrable Securities or PIPE Securities owned by each such holder at such
time.

       

      (d)           Selection of
Underwriters.  In case of a Piggyback Registration that is an
underwritten offering, the Company will have the right to select the investment
banker(s) and manager(s) to administer the offering, which investment banker(s)
and manager(s) will be nationally recognized and reasonably acceptable to the
holders of a majority of the Registrable Securities included in such Piggyback
Registration.  The Company will not be required to include any
Registrable Securities in such underwritten offering unless the holders of a
majority of the Registrable Securities comply with Section 8
hereof.

       

      (e)           Other
Registrations.  If the Company has previously filed a
registration statement with respect to Registrable Securities pursuant to Section 2 or this
Section 3,
and if such previous registration has not been withdrawn or abandoned, the
Company will not file or cause to be effected any other registration of any of
its equity securities or securities convertible or exchangeable into or
exercisable for its equity securities under the Securities Act (except on
Forms S-4 or S-8 or any similar or successor forms), whether on its own
behalf or at the request of any holder or holders of such securities, until a
period of at least six (6) months has elapsed from the effective date of such
previous registration.

       

      (f)           Obligations of
Seller. During such time as any holder of Registrable Securities may be
engaged in a distribution of securities pursuant to an underwritten Piggyback
Registration, such holder shall distribute any Registrable Securities held by
such holder only under the registration statement and solely in the manner
described in the registration statement.

       

      4.           Holdback
Agreements.

       

      (a)           No
holder of Registrable Securities shall sell, transfer, make any short sale of,
grant any option for the purchase of, or enter into any hedging or similar
transaction with the same economic effect as a sale (including sales pursuant to
Rule 144) (a "Sale
Transaction") of any equity securities of the Company, or any securities
convertible into or exchangeable or exercisable for any such equity securities,
during the seven (7) days prior to and the 90-day period beginning on the
effective date of such underwritten registration (each a "Holdback Period"),
except as part of such underwritten registration, unless the underwriters
managing such public offering otherwise agree in writing or unless the holders
of PIPE Securities are subject to substantially similar
restrictions.  If (i) the Company issues an earnings release or
other material news or a material event relating to the Company and its
Subsidiaries occurs, in either case during the last 17 days of the Holdback
Period or (ii) prior to the expiration of the Holdback Period, the Company
announces that it will release earnings results during the 16-day period
beginning upon the expiration of such period, then to the extent necessary for a
managing or co-managing underwriter of a registered offering required hereunder
to comply with NASD Rule 2711(f)(4), the Holdback Period will be extended until
18 days after the earnings release or the occurrence of the material news or
event, as the case may be

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (such
period referred to herein as the "Holdback
Extension").  The Company may impose stop-transfer instructions
with respect to the shares of Common Stock (or other securities) subject to the
foregoing restriction until the end of such period, including any period of any
Holdback Extension.

       

      (b)           The
Company (i) shall not effect any public sale or distribution of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, during the seven (7) days prior to and during such period
of time as may be determined by the underwriters managing such underwritten
registration following the effective date of any underwritten Short Form
Registration or Piggyback Registration (not to exceed 90 days (except as
extended during the period of any Holdback Extension)) (except as part of such
underwritten registration or pursuant to registrations on Form S-8 or any
successor form), unless the underwriters managing the registered public offering
otherwise agree in writing, and (ii) shall cause each holder of at least 5% (on
a fully-diluted basis) of its Common Stock, PIPE Securities, or any securities
convertible into or exchangeable or exercisable for Common Stock, purchased from
the Company at any time after the date of this Agreement (other than in a
registered public offering) to agree not to effect any public sale or
distribution (including sales pursuant to Rule 144) of any such securities
during such period (as extended by any Holdback Extension), except as part of
such underwritten registration, if otherwise permitted, unless the underwriters
managing the registered public offering otherwise agree in writing.

       

      5.           Registration
Procedures.  Whenever the holders of Registrable Securities
have requested that any Registrable Securities be registered as permitted by
this Agreement, the Company shall use its best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Company shall
as expeditiously as possible:

       

      (a)           in
accordance with the Securities Act and all applicable rules and regulations
promulgated thereunder, prepare and file with the Securities and Exchange
Commission a registration statement, and all amendments and supplements thereto
and related prospectuses, with respect to such Registrable Securities and use
its best efforts to cause such registration statement to become effective (provided, that before filing
a registration statement or prospectus or any amendments or supplements thereto,
the Company shall furnish to one counsel selected by the holders of a majority
of the Registrable Securities covered by such registration statement copies of
all such documents proposed to be filed, which documents shall be subject to the
review and comment of such counsel), and include in any such registration such
additional information reasonably requested by a majority of the Registrable
Securities registered under the applicable registration statement, or the
underwriters, if any, for marketing purposes, whether or not required by
applicable securities laws;

       

      (b)           notify
each holder of Registrable Securities of the effectiveness of each registration
statement filed hereunder and prepare and file with the Securities and Exchange
Commission such amendments and supplements to such registration statement and
the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for the lesser of (x) 180 days and
(y) such shorter period which will terminate when all Registrable
Securities covered by the registration statement have been sold and comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (c)           furnish
to each seller of Registrable Securities thereunder such number of copies of
such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus), each Free Writing Prospectus and such other documents as such
seller may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such seller;

       

      (d)           use
its best efforts to register or qualify such Registrable Securities under such
other securities or blue sky laws of such jurisdictions as any seller reasonably
requests and do any and all other acts and things which may be reasonably
necessary or advisable to enable such seller to consummate the disposition in
such jurisdictions of the Registrable Securities owned by such seller (provided, that the Company
shall not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subsection, (ii) subject itself to taxation in any such jurisdiction or
(iii) consent to general service of process (i.e., service of process
which is not limited solely to securities law violations) in any such
jurisdiction);

       

      (e)           notify
each seller of such Registrable Securities, (i) promptly after it receives
notice thereof, of the date and time when such registration statement and each
post-effective amendment thereto has become effective or a prospectus or
supplement to any prospectus relating to a registration statement has been filed
and when any registration or qualification has become effective under a state
securities or blue sky law or any exemption thereunder has been obtained,
(ii) promptly after receipt thereof, of any request by the Securities and
Exchange Commission for the amendment or supplementing of such registration
statement or prospectus or for additional information, and (iii) at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement contains an untrue statement
of a material fact or omits any fact necessary to make the statements therein
not misleading, and, at the request of any such seller, the Company shall
promptly prepare a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus will not contain an untrue statement of a material fact or omit to
state any fact necessary to make the statements therein not
misleading;

       

      (f)           prepare
and file promptly with the Securities and Exchange Commission, and notify such
holders of Registrable Securities prior to the filing of, such amendments or
supplements to such registration statement or prospectus as may be necessary to
correct any statements or omissions if, at the time when a prospectus relating
to such securities is required to be delivered under the Securities Act, when
any event has occurred as the result of which any such prospectus or any other
prospectus as then in effect would include an 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 not misleading, and, in case any such
holders of Registrable Securities or any underwriter for any such holders is
required to deliver a prospectus at a time when the prospectus then in
circulation is not in compliance with the Securities Act or the rules and
regulations promulgated thereunder, the Company shall use its best efforts to
prepare promptly upon request of any such holders or underwriters such
amendments or supplements to such registration statement and prospectus as may
be necessary in order for such prospectus to comply with the requirements of the
Securities Act and such rules and regulations;

       

      (g)           cause
all such Registrable Securities to be listed on each securities exchange on
which similar securities issued by the Company are then listed;

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (h)           provide
a transfer agent and registrar for all such Registrable Securities not later
than the effective date of such registration statement;

       

      (i)           enter
into and perform such customary agreements (including underwriting agreements in
customary form) and take all such other actions as the holders of a majority of
the Registrable Securities being sold or the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities (including, without limitation, participation in "road shows,"
investor presentations and marketing events and effecting a stock split or a
combination of shares);

       

      (j)           make
available at reasonable times for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other agent retained by
any such seller or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors, employees and independent accountants to supply all
information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement subject to
the applicable person(s) executing a nondisclosure agreement in reasonable form
and substance if reasonably required by the Company;

       

      (k)           otherwise
use its reasonable best efforts to comply with all applicable rules and
regulations of the Securities and Exchange Commission;

       

      (l)           permit
any holder of Registrable Securities, which holder, in the Company’s judgment,
is or might be deemed to be an underwriter or a controlling person of the
Company, to participate in the preparation of such registration or comparable
statement and to require the insertion therein of material, furnished to the
Company in writing, which in the reasonable judgment of such holder and its
counsel should be included;

       

      (m)           use
its best efforts to prevent the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any common stock included in such registration statement for sale in any
jurisdiction, and in the event of the issuance of any such stop order or other
such order the Company shall advise such holders of Registrable Securities of
such stop order or other such order promptly after it shall receive notice or
obtain knowledge thereof and shall use its best efforts promptly to obtain the
withdrawal of such order;

       

      (n)           use
its best efforts to cause such Registrable Securities covered by such
registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate  the disposition of such Registrable
Securities;

       

      (o)           provide
a legal opinion of the Company's outside counsel, dated the effective date of
such registration statement (and, if such registration includes an underwritten
public offering, dated the date of the closing under the underwriting
agreement), with respect to the registration statement, each amendment and
supplement thereto, the prospectus included therein (including the preliminary
prospectus) in customary form and covering such matters of the type customarily
covered by legal opinions of such nature.

       

      If any
such registration or comparable statement refers to any holder by name or
otherwise as the holder of any securities of the Company and if, in the
Company’s judgment, such holder is or might

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      be deemed
to be a controlling person of the Company, such holder will have the right to
require (i) the insertion therein of language, in form and substance
reasonably satisfactory to such holder and presented to the Company in writing,
to the effect that the holding or sale by such holder of such securities is not
to be construed as a recommendation by such holder of the investment quality of
the Company's securities covered thereby and that such holding or sale does not
imply that such holder shall assist in meeting any future financial requirements
of the Company, or (ii) in the event that such reference to such holder by
name or otherwise is not required by the Securities Act or any similar Federal
statute then in force, the deletion of the reference to such holder; provided, that with respect
to this clause (ii) such holder shall furnish to the Company an opinion of
counsel to such effect, which opinion and counsel shall be reasonably
satisfactory to the Company.

       

      6.           Registration
Expenses.  All Registration
Expenses, shall be borne as provided in this Agreement, except that the Company
shall, in any event, pay its internal expenses (including, without limitation,
all salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit or quarterly review, the
expense of any liability insurance and the expenses and fees for listing the
securities to be registered on each securities exchange on which similar
securities issued by the Company are then listed.  Each Person that
sells securities pursuant to a Short Form Registration or Piggyback Registration
hereunder shall bear and pay all underwriting discounts and commissions
applicable to the securities sold for such Person's account.

       

      7.           Indemnification.

       

      (a)           The
Company agrees to indemnify, to the extent permitted by law, each holder of
Registrable Securities, its partners, members, officers and directors and each
Person who controls such holder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities and expenses arising out of or
based upon any untrue or alleged untrue statement of material fact contained in
any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and shall reimburse such holder, partners, members,
director, officer or controlling person for any legal or other expenses
reasonably incurred by such holder, partner, member, officer, director or
controlling person in connection with the investigation or defense of such loss,
claim, damage, liability or expense, except insofar as the same are caused by or
contained in any information furnished in writing to the Company by such holder
expressly for use therein or by such holder's failure to deliver a copy of the
registration statement or prospectus or any amendments or supplements thereto
after the Company has furnished such holder with a sufficient number of copies
of the same.  In connection with an underwritten offering, the Company
shall indemnify such underwriters, their officers and directors and each Person
who controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the holders
of Registrable Securities.

       

      (b)           In
connection with any registration statement in which a holder of Registrable
Securities is participating, each such holder shall furnish to the Company in
writing such information and affidavits as the Company reasonably requests for
use in connection with any such registration statement or prospectus and, to the
extent permitted by law, shall (i) indemnify the Company, its directors and
officers and each Person who controls the Company (within the meaning of the
Securities Act) against any losses, claims, damages, liabilities and expenses
resulting from any untrue or alleged untrue statement of material fact relating
to such holder and provided by such

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      holder to
the Company or the Company's agent contained in the registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only to the extent that such untrue statement or omission is contained in, or
based upon, any information or affidavit so furnished in writing by such holder;
provided, that the
obligation to indemnify will be individual, not joint and several, to each
holder and will be limited to the net amount of proceeds received by such holder
from the sale of Registrable Securities pursuant to such registration statement,
and (ii) reimburse the Company, its directors and officers and each Person who
controls the Company (within the meaning of the Securities Act) for any legal or
other expenses reasonably incurred by such Persons in connection with the
investigation or defense of such loss, claim, damage, liability or expense,
except insofar as the same are caused by or contained in any information
furnished to such holder of Registrable Securities by such Persons expressly for
use therein.  In connection with an underwritten offering in which a
holder of Registrable Securities is participating, each such holder shall
indemnify such underwriters, their officers and directors and each Person who
controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the
Company, its directors and officers and each Person who controls the Company
(within the meaning of the Securities Act).

       

      (c)           Any
Person entitled to indemnification hereunder shall (i) give prompt written
notice to the indemnifying party of any claim with respect to which it seeks
indemnification (provided, that failure to
give such notice shall not affect the right of such Person to indemnification
hereunder unless such failure is prejudicial to the indemnifying party's ability
to defend such claim) and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party.  If such defense is assumed,
the indemnifying party will not be subject to any liability for any settlement
made by the indemnified party without its prior written consent (but such
consent shall not be unreasonably withheld).  An indemnifying party
who is not entitled to, or elects not to, assume the defense of a claim shall
not be obligated to pay the fees and expenses of more than one counsel for all
parties indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim.

       

      (d)           The
indemnification provided for under this Agreement will remain in full force and
effect regardless of any investigation made by or on behalf of the indemnified
party or any officer, director or controlling Person of such indemnified party
and will survive the transfer of securities.  The Company and each
holder also agree to make such provisions, as are reasonably requested by any
indemnified party, for contribution to such party in the event the
indemnification provided for herein is unavailable for any reason.

       

      (e)           If
the indemnification provided for in this Section 7 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party or is otherwise unenforceable with respect to any loss, claim, damage,
liability or action referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amounts
paid or payable by such indemnified party as a result of such loss, claim,
damage, liability or action in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other hand in connection with the statements or omissions which
resulted in such loss, claim, damage, liability or action as well as any other
relevant equitable

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      considerations;
provided, that the
maximum amount of liability in respect of such contribution shall be limited, in
the case of each seller of Registrable Securities, to an amount equal to the net
proceeds actually received by such seller from the sale of Registrable
Securities effected pursuant to such registration.  The relative fault
of the indemnifying party and of the indemnified party will be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.  The parties hereto
agree that it would not be just or equitable if the contribution pursuant to
this Section
7(f) were to be determined by pro rata allocation or by any
other method of allocation that does not take into account such equitable
considerations.  The amount paid or payable by an indemnified party as
a result of the losses, claims, damages, liabilities or expenses referred to
herein will be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending against
any action or claim which is the subject hereof.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any Person who is not
guilty of such fraudulent misrepresentation.

       

      (f)           No
indemnifying party shall, except with the consent of the indemnified party,
consent to the entry of any judgment or enter into any settlement that does not
include as an unconditional term thereof given by the claimant or plaintiff to
such indemnified party of a release from all liability in respect to such claim
or litigation.

       

      (g)           Notwithstanding
the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection
with an underwritten public offering conflict with the foregoing provisions, the
provisions in the underwriting agreement will control.

       

      8.           Participation
in Underwritten Registrations.  No Person may participate in
any registration hereunder which is underwritten unless such Person
(a) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements (including pursuant to any over-allotment or "green
shoe" option requested by the underwriters, provided, that no holder of
Registrable Securities or PIPE Securities shall be required to sell more than
the number of Registrable Securities or PIPE Securities such holder has
requested to include) and (b) completes and executes all customary
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements; provided,
that no holder of Registrable Securities included in any underwritten
registration shall be required to make any representations or warranties to the
Company or the underwriters other than representations and warranties regarding
such holder and such holder's intended method of distribution.  Each
holder of Registrable Securities agrees to execute and deliver such other
agreements as may be reasonably requested by the Company and the lead managing
underwriter(s) that are consistent with such holder's obligations under Section 4 or that are
necessary to give further effect thereto.

       

      9.           Rule 144
Reporting.  With a view to making available to the holders of
Registrable Securities the benefits of certain rules and regulations of the
Securities and Exchange Commission which may permit the sale of the Registrable
Securities to the public without registration, the Company agrees to use its
best efforts to:

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (a)           make
and keep current public information available, within the meaning of Rule 144 or
any similar or analogous rule promulgated under the Securities Act, at all times
after it has become subject to the reporting requirements of the Exchange
Act;

       

      (b)           file
with the Securities and Exchange Commission, in a timely manner, all reports and
other documents required of the Company under the Securities Act and Exchange
Act (after it has become subject to such reporting requirements);
and

       

      (c)           so
long as any party hereto owns any Registrable Securities, furnish to such Person
forthwith upon request, a written statement by the Company as to its compliance
with the reporting requirements of said Rule 144 (at any time commencing
ninety (90) days after the effective date of the first registration filed by the
Company for an offering of its securities to the general public), the Securities
Act and the Exchange Act (at any time after it has become subject to such
reporting requirements); a copy of the most recent annual or quarterly report of
the Company; and such other reports and documents as such Person may reasonably
request in availing itself of any rule or regulation of the Securities and
Exchange Commission allowing it to sell any such securities without
registration.

       

      10.           Additional
Shares.

       

      (a)           On
the Price Determination Date, the Company shall make a determination of the
actual trading value of the shares of Common Stock of the Company by averaging
any consecutive or non consecutive five (5) day, daily weighted average trading
price during the 40 trading days immediately prior to the Price Determination
Date as reported on Bloomberg news service, or, if the securities are trading on
an exchange or quoted on any Nasdaq market, based on the official transaction
pricing reporting of such exchange or Nasdaq market (the “Assumed Value”);
provided, that if the
Price Determination Date occurs due to the closing of a PIPE Offering, the
Assumed Value shall be the price of the PIPE
Securities,  and,  as soon thereafter as possible issue to
Fourth Third such number of additional shares of Common Stock (the “Additional Shares” )
as equals “Y” where “Y” equals the sum of (A) $11,000,000 divided by (B) the
Assumed Value, less the number of Shares issued hereby as adjusted for stock
splits, combinations or similar transactions, up to a maximum of 1,100,000
Additional Shares.  By way of examples only, (i) if the Assumed Value
as determined at a Price Determination Date is determined to be $8.00, then, in
addition to the 1,100,000 Shares previously issued, 275,000 Additional Shares
shall be issued, and (ii) if the Assumed Value is determined to be $5.00, then,
in addition to the 1,100,000 Shares previously issued, 1,100,000 Additional
Shares shall be issued.

       

      (b)           At
any time that there is indebtedness outstanding under the Credit Agreement, the
Company may, at its sole and absolute discretion, repurchase, for consideration
(the “Repurchase
Amount”) of (i) $5,000,000, a portion of the Shares and Additional Shares
held by all holders, equal to all such Shares and Additional Shares in excess of
635,231 shares of Common Stock, as adjusted for stock splits, recombination or
similar transactions, or (ii) $10,000,000, all Shares and Additional Shares held
by all holders.

       

      (c)           Notwithstanding
the foregoing, the Assumed Value shall not be increased and no Shares or
Additional Shares issued to the Holder shall be cancelled.  The
Adjustment is in addition to the other rights of the Holder described in this
Agreement. The certificate(s) representing all Shares and Additional Shares (if
any) issued to Fourth Third and its assigns shall be appropriately legended
reflecting the foregoing.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (d)           Upon
the occurrence of each Adjustment, the Company, at its expense, shall promptly
compute such Adjustment or readjustment and prepare and furnish to the Holder a
certificate setting forth such Adjustment and showing in detail the facts upon
which such Adjustment is based.  Upon the occurrence of each
Adjustment, the Company shall issue and deliver to the Holder, a stock
certificate or certificates representing the Additional Shares or immediately
pay the Repurchase Amount.

       

      (e)           Unless
permitted by the applicable rules and regulations of the principal securities
market on which the Common Stock is then listed or traded, in no event shall the
Company issue pursuant to this Agreement, more than the maximum number of shares
of Common Stock that the Borrower can issue pursuant to any rule of the
principal United States securities market on which the Common Stock is then
traded, subject to equitable adjustment from time to time for stock splits,
reverse stock splits, stock dividends, combinations, capital reorganizations and
similar events relating to the Common Stock occurring after the date
hereof.  If such rules or regulations would prohibit an issuance of
Additional Shares pursuant to the Adjustment, the Company shall pay the Holder
the Repurchase Amount, or, at the Holder’s option, issue the Holder non-voting
Common Stock or issue the Holder a promissory amount reflecting the dollar value
of the Adjustment and the material terms of the indebtedness under the Credit
Agreement.

       

      (f)           Until
the Price Determination Date, Holder may not, on its own or through entities
under its control, sell, short sell, agree to sell or sell or write calls
options or warrants, hypothecate, loan, or enter into or maintain any short
equivalent position, arbitrage arrangement or hedging transaction resulting in a
short equivalent position, with respect to any of the Shares on any market,
quotation service or exchange where the Common Stock is trading or authorized
for quotations.

       

      11.           Notices.  All
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Agreement shall be in writing and shall be
deemed to have been given when delivered personally, mailed by certified or
registered mail, return receipt requested and postage prepaid, or sent via a
nationally recognized overnight courier, or sent via facsimile to the recipient
accompanied by a certified or registered mailing.  Such notices,
demands and other communications shall be sent to the Company and the Holder at
the addresses set forth below and to the other parties hereto at such address or
to the attention of such other person as is specified in the Company's books and
records:

       

      If to the
Company:

       

      PNG
Ventures, Inc.

      2038
Corte Del Nogal, Suite 110

      Carlsbad,
California  92011

      Attention:
Mark Baum, Esq.

      Tel.
(760) 804-8844 x205

      Facsimile:
(760) 804-8845

      

      with a
copy to:

      

      Hodgson
Russ, LLP

      1540
Broadway, 24th
Floor

      New York,
NY 10036

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Attention:
Ron Levy, Esq.

      Tel.
(212) 751-4300

      Fax.
(212) 751-0928

      Email:
rlevy@hodgsonruss.com

      

      

      If to
Fourth Third:

      

      Fourth
Third LLC

      375 Park
Avenue

      Suite 3304

      New York,
NY 10152

      Attention:
Brian J. Cavanagh, CFO

      Tel (212)
759-7577

      Facsimile:
(212) 759-0091

      Email:
brian@medleycapital.com

      

      

      King & Spalding, LLP

      1185 Avenue of the
Americas

      New York, NY 10036

      Attention: Gerald Woods,
Esq.

      Tel. (212) 556-2232

      Facsimile: (212) 556-2222

      Email: GWoods@KSLAW.com

      

      or such
other address or to the attention of such other Person as the recipient party
shall have specified by prior written notice to the sending party.

       

      12.           Miscellaneous.

       

      (a)           No Inconsistent
Agreements.  The Company shall not enter into any agreement
which is inconsistent with or violates the rights granted to the holders of
Registrable Securities in this Agreement.

       

      (b)           Remedies.  Any
Person having rights under any provision of this Agreement will be entitled to
enforce such rights specifically to recover damages caused by reason of any
breach of any provision of this Agreement and to exercise all other rights
granted by law.  The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or other
security) for specific performance and for other injunctive relief in order to
enforce or prevent violation of the provisions of this Agreement.

       

      (c)           Amendments and
Waivers.  Except as otherwise provided herein, the provisions
of this Agreement may be amended or waived only upon the prior written consent
of the Company and the holders of at least a majority of the Registrable
Securities.  Notwithstanding anything to the contrary, no
modification, amendment or waiver of any provision that materially and adversely
affects the rights or obligations hereunder of any particular holder of
Registrable

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Securities
or group of holders of Registrable Securities while not similarly affecting the
rights or obligations hereunder of all holders of Registrable Securities shall
be effective against such holder or group of holders unless approved in writing
by such holder or the holders of a majority of the Registrable Securities held
by such group of holders, as the case may be.  The failure of any
party to enforce any of the provisions of this Agreement shall in no way be
construed as a waiver of such provisions and shall not affect the right of such
party thereafter to enforce each and every provision of this Agreement in
accordance with its terms.

       

      (d)           Successors and
Assigns.  All covenants and agreements in this Agreement by or
on behalf of any of the parties hereto shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto whether so expressed
or not.  In addition, whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of purchasers
or holders of Registrable Securities are also for the benefit of, and
enforceable by, any subsequent holder of Registrable Securities.

       

      (e)           Severability.  Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement.

       

      (f)           Counterparts.  This
Agreement may be executed simultaneously in two or more counterparts, any one of
which need not contain the signatures of more than one party, but all such
counterparts taken together shall constitute one and the same
Agreement.  Facsimile or scanned and emailed counterparts signatures
to this Agreement shall be acceptable and binding.

       

      (g)           GOVERNING
LAW.  ALL
QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR
CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF DELAWARE OR ANY OTHER
JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF DELAWARE.

       

      (h)           Time is of the Essence;
Computation of Time.  Time is of the essence for each and every
provision of this Agreement.  Whenever the last day for the exercise
of any privilege or the discharge of any duty hereunder shall fall upon a
Saturday, Sunday, or any date on which banks in New York, New York are
authorized to be closed, the party having such privilege or duty may exercise
such privilege or discharge such duty on the next succeeding day which is a
regular business day.

       

      (i)           Entire
Agreement.  This Agreement and all other agreements
contemplated by this Agreement supersede all prior discussions and agreements
between the parties with respect to the subject matter hereof and thereof and
contain the sole and entire agreement between the parties hereto with respect to
the subject matter hereof and thereof.

       

      (j)           Descriptive
Headings.  The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this
Agreement.

       
            *   *   *   *   *   *

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      IN WITNESS WHEREOF, the
parties hereto have executed this Master Rights Agreement as of the Effective
Date.

       

      

       

      PNG
VENTURES, INC.

       

      

       

      By:           /s/ Kevin Markey                                                   

      Name:
Kevin Markey

      Title:
Chief Executive Officer

       

      

       

      FOURTH
THIRD LLC

       

      

       

      By:           /s/ Seth R. Taube                                                   

      Name:
Seth R. Taube

      Title:
Authorized Signatory

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