Document:

altair_8k-ex1001.htm

    
      

    

     

    Exhibit
      10.1

     

     

    
      
        	
                Certain
                  portions of this exhibit have been omitted pursuant to Rule 24b-2
                  and are
                  subject
                  to a confidential treatment request. Copies of this exhibit containing
                  the
                  omitted
                  information have been filed separately with the Securities and
                  Exchange
                  Commission.
                  The omitted portions of this document are marked with a
                  ***.

              

      

    

    

    

    THE
      SHARES OFFERED HEREUNDER HAVE NOT BE REGISTERED UNDER THE UNITED STATES
      SECURITIES ACT OF 1933, AS AMENDED (“THE SECURITIES ACT”) IN RELIANCE UPON
      REGULATION S PROMULGATED UNDER THE SECURITIES ACT.  TRANSFER OF THESE
      SHARES IN THE UNITED STATES OR TO U.S. PERSONS IS PROHIBITED, EXCEPT IN
      ACCORDANCE WITH THE PROVISIONS OF REGULATIONS S, PURSUANT TO REGISTRATION UNDER
      THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.
      HEDGING TRANSACTIONS IN THE COMMON STOCK OF THE COMPANY MAY NOT BE CONDUCTED
      UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

    

    PURCHASE
      AGREEMENT

    

    

    THIS
      PURCHASE AGREEMENT (“Agreement”)
      is made as of November 29, 2007 (the “Effective Date”) by and between Altair
      Nanotechnologies Inc., a Canadian corporation (the “Company”), and Al Yousuf,
      LLC, a United Arab Emirates limited liability company (the
“Investor”).

    

    Recitals

    

    A.           The
      Company and the Investor are executing and delivering this Agreement in reliance
      upon the exemption from securities registration afforded by the provisions
      of
      Regulation S (“Regulation S”), as promulgated by the U.S. Securities and
      Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended;
      and

    

    B.           The
      Investor wishes to purchase from the Company, and the Company wishes to sell
      and
      issue to the Investor, upon the terms and conditions stated in this Agreement,
      common shares of the Company (“Common Stock”); and

    

    C.           Contemporaneous
      with the sale of the Common Stock, the parties hereto will execute and deliver
      a
      Registration Rights Agreement, in the form attached hereto as Exhibit A (the
      “Registration Rights Agreement”), pursuant to which the Company will agree to
      provide certain registration rights under the Securities Act of 1933, as
      amended, and the rules and regulations promulgated thereunder, and applicable
      state securities laws.

    

    In
      consideration of the mutual promises
      made herein and for other good and valuable consideration, the receipt and
      sufficiency of which is hereby acknowledged, the parties hereto agree as
      follows:

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    1.           Definitions.  In
      addition to those terms defined above and elsewhere in this Agreement, for
      the
      purposes of this Agreement, the following terms shall have the meanings set
      forth below:

    

    “Affiliate”
means,
      with respect
      to any Person, any other Person which directly or indirectly through one or
      more
      intermediaries Controls, is Controlled by, or is under common Control with,
      such
      Person.

    

    “Business
      Day” means a day,
      other than a Friday, Saturday or Sunday, on which banks in New York City, New
      York and the United Arab Emirates are open for the general transaction of
      business.

    

    “Common
      Stock” has the meaning
      set forth in the Recitals.

    

    “Company’s
      Knowledge” (including
      any derivation thereof such as “known” or “knowing”) means the actual knowledge
      of the executive officers (as defined in Rule 405 under the 1933 Act) of the
      Company, after due inquiry, including, but not limited to, reviewing this
      Agreement.

    

    “Confidential
      Information” means
      trade secrets, confidential information and know-how (including but not limited
      to ideas, formulae, compositions, processes, procedures and techniques, research
      and development information, computer program code, performance specifications,
      support documentation, drawings, specifications, designs, business and marketing
      plans, and customer and supplier lists and related information).

    

    “Control”
(including
      the terms
“controlling”, “controlled by” or “under common control with”) means the
      possession, direct or indirect, of the power to direct or cause the direction
      of
      the management and policies of a Person, whether through the ownership of voting
      securities, by contract or otherwise.

    

    “Intellectual
      Property” means
      all of the following: (i) patents, patent applications, patent disclosures
      and
      inventions (whether or not patentable and whether or not reduced to practice);
      (ii) trademarks, service marks, trade dress, trade names, corporate names,
      logos, slogans and Internet domain names, together with all goodwill associated
      with each of the foregoing; (iii) copyrights and copyrightable works; (iv)
      registrations, applications and renewals for any of the foregoing; and (v)
      proprietary computer software (including but not limited to data, data bases
      and
      documentation).

    

    “Material
      Adverse Effect” means
      a material adverse effect on (i) the assets, liabilities, results of operations,
      condition (financial or otherwise), prospects or business of the Company and
      its
      Subsidiaries taken as a whole, or (ii) the ability of the Company to perform
      its
      obligations under the Transaction Documents.

    

    “Person”
means
      an individual,
      corporation, partnership, limited liability company, trust, business trust,
      association, joint stock company, joint venture, sole proprietorship,
      unincorporated organization, governmental authority or any other form of entity
      not specifically listed herein.

     

     

    
      
        
        

      

      
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    “Per
      Share Price” means $3.50
      per Share.

     

    “Predecessor”
      means, with respect to the Company, an entity substantially all of whose assets
      and business was acquired by the Company or one of its Subsidiaries, whether
      through merger, consolidation, asset purchase, stock purchase or
      otherwise.

    

    “Purchase
      Price” means the
      product of the number of Shares multiplied by the Per Share Price (which is
      $40,000,002).

    

    “Registration
      Statement” shall
      mean any registration statement of the Company filed under the 1933 Act that
      covers the resale of any of the Registrable Securities (as defined in the
      Registration Rights Agreement) pursuant to the provisions of the Registration
      Rights Agreement by and among the Company and the Investor as of the date
      hereof, amendments and supplements to such Registration Statement, including
      post-effective amendments, all exhibits and all material incorporated by
      reference in such Registration Statement.

    

    “SEC
      Filings” has the meaning
      set forth in Section 4.6.

    

    “Shares”
means
      11,428,572 shares
      of Common Stock.

    

    “Subsidiary”
means
      a Person of
      which the Company holds, directly or indirectly, more than 40% of the
      outstanding equity interests.

    

    “Transaction
      Documents” means
      this Agreement and the Registration Rights Agreement.

    

    “Transfer
      Agent” means Equity
      Transfer Services and Trust Company or the successor transfer agent of the
      Company.

    

    “1933
      Act” means the Securities
      Act of 1933, as amended, or any successor statute, and the rules and regulations
      promulgated thereunder.

    

    “1934
      Act” means the Securities
      Exchange Act of 1934, as amended, or any successor statute, and the rules and
      regulations promulgated thereunder.

    

    2.           Purchase
      and Sale of the Shares.  Subject to the terms and conditions of
      this Agreement, on the Closing Date, the Investor shall purchase, and the
      Company shall sell and issue to, the Shares in exchange for the Purchase
      Price.

    

    3.           Closings.

     

     

    
      
        
        

      

      
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    (a)           Two
      Closings. The closing of the purchase and sale of the Shares shall take
      place in two closings, each of which is referred to as a “Closing” and
      shall be deemed to have occurred at the time (the “Closing Date”) on
      which the Company receives truthful confirmation (including reference number)
      from the custodian of the London Account (as defined below) that the applicable
      portion of the Purchase Price has been transferred from the London Account
      (as
      defined below) to the Company Account. At each Closing, the Investor shall
      wire
      transfer the applicable portion of the Purchase Price to the London Account
      with
      irrevocable instructions to the custodian of such account that the applicable
      portion of the Purchase Price immediately be wire transferred to the Company
      Account (and that a reference number for such transfer immediately be provided
      to Edward Dickinson via email at edickinson@altairnano.com or by
      telephone at the U.S. number (775) 858-3750).

    

    The
      “London Account” is:

    

               ***

    

    The
      “Company Account” is:

    

    ***

    

    (b)           Initial
      Closing.  At the initial Closing (the “Initial Closing”),
      the Investor shall purchase from the Company, and the Company shall sell to
      the
      Investor, 2,857,142 of the Shares (the “Initial Shares”) in exchange for
      $9,999,997 of the Purchase Price (the “Initial Purchase
      Price”).  The Initial Closing shall occur (i.e. the Initial
      Purchase Price shall be received in the Account) no later than November 30,
      2007.  Within two (2) Business Days after the receipt by the Company
      of the Initial Purchase Price in the Company Account, the Company shall deliver
      to Akin Gump Strauss Hauer & Feld LLP, for the benefit of the Investor, at
      the following address, 2029 Century Park East, Suite 2400, Los Angeles, CA
      90067-3012, Attn: Julie M Kaufer, Telephone (310) 229-1000, a single certificate
      representing the Initial Shares registered in the name of the Investor and
      with
      such legends as are contemplated by this Agreement.

    

    (c)           Subsequent
      Closing.  At the subsequent Closing (the “Final Closing”),
      the Investor shall purchase from the Company, and the Company shall sell to
      the
      Investor, the remaining 8,571,430  of the Shares (the “Remaining
      Shares”) in exchange for the remaining $30,000,005 of the Purchase Price
      (the “Remaining Purchase Price”).  The Final Closing shall
      occur (i.e. the Remaining Price shall be received in the Account) no later
      than
      December 10, 2007. Within two (2) Business Days after the receipt by the Company
      of the Remaining Purchase Price, the Company shall deliver to JP Morgan
      Securities Inc., for the benefit of the Investor, at the address identified
      in
      Section 3(b) above, certificates representing the Remaining Shares registered
      in
      the name of the Investor and with such legends as are contemplated by this
      Agreement.  The certificates shall be issued in such denominations,
      adding up to the number of Remaining Shares, as reasonably requested by the
      Investor (and, absent specific instructions from the Investor, there shall
      be
      three certificates, with two issued in denominations representing approximately
      one-third of the total number of Shares and the third issued in a denomination
      representing the remainder after taking into account the Initial Shares, in
      each
      case with legends reflecting the different expiration periods of the lock up
      covenants described in Section 8).

     

     

    
      
        
        

      

      
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    4.           Representations
      and Warranties of the Company.  The Company hereby represents and
      warrants to the Investor that, subject to the exceptions fully, fairly and
      specifically disclosed in the disclosure letter (referencing the appropriate
      section and paragraph numbers) delivered by Company to the Investor dated as
      of
      the date hereof (the “Disclosure Letter”), which exceptions shall be
      deemed to be representations and warranties as if made hereunder, the following
      statements are true, accurate, complete and not misleading as of the Effective
      Date, except where another date is specified in the representation or warranty
      (for the avoidance of doubt, if any section in the Disclosure Letter discloses
      an item or information in such a way as to make its relevance to the disclosure
      required by another section of the Disclosure Letter readily apparent based
      on
      the substance of such disclosure, such matter shall be deemed to have been
      disclosed in such other section of the Disclosure Letter, notwithstanding the
      omission).   No other knowledge of the Investor relating to the
      Company will prevent or limit a claim made by the Investor for breach of any
      of
      the representations and warranties in this Section 4.  The Company may
      not put forward the Investor’s knowledge (actual, constructive or imputed) of
      any facts which might make any of the representations and warranties in this
      Section 4 untrue, inaccurate, incomplete or misleading as a defense to a claim
      for breach of any of the representations and warranties.

    

    4.
      1           Organization,
      Good Standing and Qualification.  Each of the Company and its
      Subsidiaries is a company duly organized, validly existing and in good standing
      under the laws of the jurisdiction of its organization and has all requisite
      company power and authority to carry on its business as now conducted and to
      own
      its properties.  Each of the Company and its Subsidiaries is duly
      qualified to do business as a foreign company and is in good standing in each
      jurisdiction in which the conduct of its business or its ownership or leasing
      of
      property makes such qualification or leasing necessary.

    

    4.
      2           Authorization.  The
      Company has full power and authority and has taken all requisite action on
      the
      part of the Company, its officers, directors and shareholders necessary for
      (i)
      the authorization, execution and delivery of the Transaction Documents, (ii)
      authorization of the performance of all obligations of the Company hereunder
      or
      thereunder, and (iii) the authorization, issuance (or reservation for issuance)
      and delivery of the Shares.  The Transaction Documents constitute the
      legal, valid and binding obligations of the Company, enforceable against the
      Company in accordance with their terms, subject to bankruptcy, insolvency,
      fraudulent transfer, reorganization, moratorium and similar laws of general
      applicability, relating to or affecting creditors’ rights
      generally.

    

    4.
      3           Capitalization.  Section
      4.3 of the Disclosure Letter sets forth as of November 26, 2007 (a) the
      authorized capital stock of the Company; (b) the number of shares of capital
      stock issued and outstanding; (c) the number of shares of capital stock issuable
      pursuant to the Company’s stock plans; and (d) the number of shares of capital
      stock issuable and reserved for issuance pursuant to securities (other than
      the
      Shares and options or other rights outstanding under the Company’s stock plans)
      exercisable for, or convertible into or exchangeable for any shares of capital
      stock of the Company.  The Company has not issued any shares of
      capital stock or any options, warrants or other rights exercisable for,
      convertible into or exchangeable for any shares of capital stock since the
      November 26, 2007. All of the issued and outstanding shares of the Company’s
      capital stock have been duly authorized and validly issued and are fully paid,
      nonassessable and free of pre-emptive rights and were issued in full compliance
      with applicable state and federal securities law and any rights of third
      parties.  No Person is entitled to pre-emptive or similar statutory or
      contractual rights with respect to any securities of the
      Company.  Except as described in the Company’s Quarterly Report on
      Form 10-Q for the period ended September 30, 2007 (the “Most Recent Form
      10-Q”) and in the Disclosure Letter, (w) there are no outstanding warrants,
      options, convertible securities or other rights, agreements or arrangements
      of
      any character under which the Company or any of its Subsidiaries is or may
      be
      obligated to issue any equity securities of any kind and except as contemplated
      by this Agreement, (x) neither the Company nor any of its Subsidiaries is
      currently in negotiations for the issuance of any equity securities of any
      kind,
      (y) there are no voting agreements, buy-sell agreements, option or right of
      first purchase agreements or other agreements of any kind among the Company
      and
      any of the security holders of the Company relating to the securities of the
      Company held by them, and (z) other than under the Registration Rights
      Agreement, no Person has the right to require the Company to register any
      securities of the Company under the 1933 Act, whether on a demand basis or
      in
      connection with the registration of securities of the Company for its own
      account or for the account of any other Person (except for such registration
      rights that have been satisfied or are being satisfied by means of a currently
      effective registration statement filed by the Company).

     

     

    
      
        
        

      

      
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    The
      issuance and sale of the Shares
      hereunder will not obligate the Company to issue shares of Common Stock or
      other
      securities to any other Person (other than the Investor) and will not result
      in
      the adjustment of the exercise, conversion, exchange or reset price of any
      outstanding security.

    

    Except
      as set forth in the Amended and
      Restated Shareholder Rights Plan dated October 15, 1999 between the Company
      and
      Equity Transfer Services, as rights agent, the Company does not have outstanding
      shareholder purchase rights or “poison pill” or any similar arrangement in
      effect giving any Person the right to purchase any equity interest in the
      Company upon the occurrence of certain events.

    

    4.4           Valid
      Issuance.  The Shares have been duly and validly authorized and,
      when issued and paid for pursuant to this Agreement, will be validly issued,
      fully paid and nonassessable, and shall be free and clear of all encumbrances
      and restrictions (other than those created by the Investor), except for
      restrictions on transfer set forth in the Transaction Documents or imposed
      by
      applicable securities laws.

    

    4.5           Consents.  The
      execution, delivery and performance by the Company of the Transaction Documents
      and the offer, issuance and sale of the Shares require no consent of, action
      by
      or in respect of, or filing with, any Person, governmental body, agency, or
      official having jurisdiction over the Company or any of its Affiliates that
      has
      not been obtained, including without limitation, the NASDAQ Capital Market
      (the
“NASDAQ Capital Market”) and the Company’s shareholders, other than (a)
      filings that have been made pursuant to applicable state securities laws and
      post-sale filings pursuant to applicable state and federal securities laws
      which
      the Company undertakes to file within the applicable time periods, (b) a
      Notification Form Listing Additional Shares to be filed with the NASDAQ Capital
      Market, which the Company undertakes to file promptly following the Effective
      Date, (c) a Current Report on Form 8-K describing the Transaction Documents
      and
      the transactions contemplated by the Transaction Documents, which the Company
      undertakes to file within four (4) Business Days after the Effective Date,
      and
      (d) filings required by the Registration Rights
      Agreement.   Subject to the accuracy of the representations and
      warranties of the Investor set forth in Section 5 hereof, the Company has taken
      all action necessary to exempt the issuance and sale of the Shares from the
      provisions of any shareholder rights plan or other “poison pill” arrangement,
      any anti-takeover, business combination or control share law or statute binding
      on the Company or to which the Company or any of its assets and properties
      may
      be subject and any provision of the Company’s Articles of Continuance or Bylaws
      that is or could reasonably be expected to become applicable to the Investor
      as
      a result of the transactions contemplated hereby, including without limitation,
      the issuance of the Shares and the ownership, disposition or voting of the
      Shares by the Investor or the exercise of any right granted to the Investor
      pursuant to this Agreement or the other Transaction Documents.

     

     

    
      
        
        

      

      
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    4.6           Delivery
      of SEC Filings; Business.

    

    (i)           The
      Company has made available to the Investor through the EDGAR system, true and
      complete copies of the Company’s most recent Annual Report on Form 10-K for the
      fiscal year ended December 31, 2006, and all other reports filed by the Company
      pursuant to the 1934 Act since December 31, 2006, and prior to the Effective
      Date (collectively, together with all Exhibits thereto and incorporated by
      reference therein, the “SEC Filings”).  The SEC Filings are the
      only filings required of the Company pursuant to the 1934 Act for such
      period.

    

    (ii)           The
      Company and its Subsidiaries are engaged in all material respects only in the
      business described in the SEC Filings, and to the extent required by rules
      governing the content of the SEC Filings, the SEC Filings contain a complete
      and
      accurate description in all material respects of the business of the Company
      and
      its Subsidiaries, taken as a whole.

    

    4.7           Use
      of Proceeds.  The net proceeds of the sale of the Shares hereunder
      shall be used by the Company for working capital, capital expenditures, and
      general corporate purposes, which may include acquisitions of complementary
      businesses, products or technologies.

    

    4.8           No
      Material Adverse Change.  Since September 30, 2007, except as
      identified and described in the SEC Filings and filings made by Affiliates
      of
      the Company on EDGAR pursuant to the 1934 Act, there has not been:

    

    (i)           any
      change in the consolidated assets, liabilities, financial condition or operating
      results of the Company from that reflected in the financial statements included
      in the Most Recent Form 10-Q, except for changes in the ordinary course of
      business which have not and could not reasonably be expected to have a Material
      Adverse Effect, individually or in the aggregate;

     

     

    
      
        
        

      

      
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    (ii)           any
      declaration or payment of any dividend, or any authorization or payment of
      any
      distribution, on any of the capital stock of the Company, or any redemption
      or
      repurchase of any securities of the Company;

    

    (iii)           any
      material damage, destruction or loss, whether or not covered by insurance to
      any
      assets or properties of the Company or its Subsidiaries;

    

    (iv)           any
      waiver, not in the ordinary course of business, by the Company or any Subsidiary
      of a material right or of a material debt owed to it;

    

    (v)           any
      satisfaction or discharge of any lien, claim or encumbrance or payment of any
      obligation by the Company or a Subsidiary, except in the ordinary course of
      business and which is not material to the assets, properties, financial
      condition, operating results prospects or business of the Company and its
      Subsidiaries taken as a whole (as such business is presently
      conducted);

    

    (vi)           any
      change or amendment to the Company’s Articles of Continuance or Bylaws, or
      material change to any material contract or arrangement by which the Company
      or
      any Subsidiary is bound or to which any of their respective assets or properties
      is subject;

    

    (vii)          any
      labor union organizing activities or material labor difficulties with respect
      to
      employees of the Company or any Subsidiary;

    

    (viii)         any
      material transaction entered into by the Company or a Subsidiary other than
      in
      the ordinary course of business;

    

    (ix)           the
      loss of the services of any key employee, or material change in the composition
      or duties of the senior management of the Company or any
      Subsidiary;

    

    (x)          
       any material changes in compensation arrangements with any key employee,
      senior management or directors;

    

    (xi)     
           the loss or threatened loss in writing of any
      customer which has had or could reasonably be expected to have a Material
      Adverse Effect;

    

    (xii)         any
      sale, assignment or exclusive license or transfer of the Company’s Intellectual
      Property;

    

    (xiii)       
      any material change in contingent obligations of the Company by way of guaranty,
      endorsement, indemnity, warranty or otherwise; or

     

     

    
      
        
        

      

      
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    (xiv)        to
      the Company’s Knowledge any events, occurrences, changes, effects or conditions
      of any character that, individually or in the aggregate, has had or could
      reasonably be expected to have a Material Adverse Effect.

    

    4.9           SEC
      Filings; S-3 Eligibility.

    

    (a)           At
      the time of filing thereof, the SEC Filings complied as to form in all material
      respects with the requirements of the 1934 Act and did not contain any untrue
      statement of a material fact or omit to state any material fact necessary in
      order to make the statements made therein, in the light of the circumstances
      under which they were made, not misleading.

    

    (b)           The
      Company is presently eligible to use Form S-3 to register the Registrable
      Securities (as such term is defined in the Registration Rights Agreement) for
      sale by the Investor as contemplated by the Registration Rights
      Agreement.

    

    (c)           The
      Company is in compliance in all material respects with all provisions of the
      Sarbanes-Oxley Act of 2002 that are applicable to it as of the Effective
      Date.

    

    4.10           No
      Conflict, Breach, Violation or Default.  The execution, delivery
      and performance of the Transaction Documents by the Company and the issuance
      and
      sale of the Shares will not conflict with or result in a breach or violation
      of
      any of the terms and provisions of, or constitute a default under (i) the
      Company’s Articles of Continuance or the Company’s Bylaws, both as in effect on
      the Effective Date (true and complete copies of which have been made available
      to the Investor through the EDGAR system), or (ii)(a) any statute, rule,
      regulation or order of any governmental agency or body or any court, domestic
      or
      foreign, having jurisdiction over the Company, any Subsidiary or any of their
      respective assets or properties, or (b) any agreement or instrument to which
      the
      Company or any Subsidiary is a party or by which the Company or a Subsidiary
      is
      bound or to which any of their respective assets or properties is
      subject.

    

    4.11           Tax
      Matters.  The Company and each Subsidiary has timely prepared and
      filed all tax returns, as amended, required to have been filed by the Company
      or
      such Subsidiary with all appropriate governmental agencies and timely paid
      all
      taxes shown thereon or otherwise owed by it.  All such tax returns are
      true, complete, and correct in all material respects.  The charges,
      accruals and reserves on the books of the Company in respect of taxes for all
      fiscal periods are adequate in all material respects, and there are no material
      unpaid assessments against the Company or any Subsidiary nor, to the Company’s
      Knowledge, any basis for the assessment of any additional taxes, penalties
      or
      interest for any fiscal period or audits by any federal, state or local taxing
      authority except for any assessment which is not material to the Company and
      its
      Subsidiaries, taken as a whole.  All taxes and other assessments and
      levies that the Company or any Subsidiary is required to withhold or to collect
      for payment have been duly withheld and collected and paid to the proper
      governmental entity or third party when due, except where such failure to
      withhold or collect would not have a Material Adverse Effect.  There
      are no tax liens or claims pending or, to the Company’s Knowledge, threatened
      against the Company or any Subsidiary or any of their respective assets or
      property.  There are no outstanding tax sharing agreements or other
      such arrangements between the Company and any Subsidiary or other corporation
      or
      entity. No audit in respect of any tax liability is
      pending with respect to any tax liability shown on a tax return filed by the
      Company or any Subsidiary.

     

     

    
 

    
      
        
        

      

      
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    4.12        
      Title to Properties.  Except as disclosed in the SEC Filings,
      the Company and each Subsidiary has good and marketable title to all real
      properties and all other properties and assets owned by it, in each case free
      from liens, encumbrances and defects that would materially affect the value
      thereof or materially interfere with the use made or currently planned to be
      made thereof by them; and except as disclosed in the SEC Filings, the Company
      and each Subsidiary holds any leased real or personal property under valid
      and
      enforceable leases with no exceptions that would materially interfere with
      the
      use made or currently planned to be made thereof by them.

    

    4.13        
      Inventory.  The Company’s stock is of satisfactory quality and
      saleable in the usual course of its business in accordance with its current
      price list.  The Company has not supplied, or agreed to supply,
      defective or unsafe products or products which fail to comply with their terms
      of sale.  No products in a state ready for supply by the Company are
      defective or unsafe or will fail to comply with terms of sale similar to terms
      of sale on which similar products have previously been sold by the
      Company.  The Company’s level of stock is reasonable having regard to
      current and anticipated demand.

     

    4.14        
      Compliance with Laws.  The Company is in compliance with all
      laws of any governmental body applicable to its business or operations, except
      where the failure to be in compliance would not have a Material Adverse
      Effect.  The Company has not received any written notice of or been
      charged with the violation of any laws, except where such violation would not
      have a Material Adverse Effect.

     

    4.15        
      Certificates, Authorities and Permits.  The Company and each
      Subsidiary possess adequate certificates, authorities or permits issued by
      appropriate governmental agencies or bodies necessary to conduct the business
      now operated by it, and neither the Company nor any Subsidiary has received
      any
      notice of proceedings relating to the revocation or modification of any such
      certificate, authority or permit that, if determined adversely to the Company
      or
      such Subsidiary, could reasonably be expected to have a Material Adverse Effect,
      individually or in the aggregate.  All such certificates, authorities
      and permits are validly held by the Company.  The Company has complied
      with all material terms and conditions thereof and the same will not be subject
      to suspension, modification, revocation or nonrenewal as a result of the
      execution and delivery of this Agreement or the consummation of the transaction
      contemplated hereby.

    

    4.16        
      Employees and Labor Disputes.  (a) No labor dispute with the
      employees of the Company or any Subsidiary exists or, to the Company’s
      Knowledge, is imminent, (b) to the Company’s  Knowledge, no union
      organizational campaign is in progress with respect to the employees of the
      Company, (c) the Company is not engaged in any unfair labor practice, (d) there
      is no unfair labor practice charge or complaint against the Company pending,
      or,
      to the Company’s Knowledge, threatened, (e) there are no pending, or, to the
      Company’s Knowledge, threatened, charges against the Company or any current or
      former employee of the Company, (f) the Company has not received written notice
      during the past two years of the intent of any governmental body responsible
      for
      the enforcement of labor or employment laws to conduct an investigation of
      the
      Company and, to the Company’s Knowledge, no such investigation is in progress
      and (g) the Company is in compliance in all material respects with all laws
      and
      orders relating to the employment of labor and classification of persons as
      employees, including all such laws and orders relating to wages, hours,
      discrimination, civil rights, safety and the collection and payment of
      withholding and similar taxes and the provision of employee benefits, except
      where any such noncompliance shall not have a Material Adverse
      Effect.

     

     

    
      
        
        

      

      
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    4.17           Benefit
      Plans.  The Company is in compliance with all of its obligations
      under any employee benefit plan within the meaning of Section 3(3) of the
      Employee Retirement Income Security Act of 1974, as amended (“ERISA”) under
      which any employee or former employee of the Company has any present of future
      right to benefits or under which the Company has or may have any present or
      future liability.  There is no multiemployer plan within the meaning
      of Section 3(37) of ERISA under which the Company has or may have any present
      or
      future liability.

    

    

    4.18           Intellectual
      Property.

    

    (a)           No
      Intellectual Property of the Company or its Subsidiaries which is necessary
      for
      the conduct of Company’s and each of its Subsidiaries’ respective businesses as
      currently conducted has been or is now involved in any cancellation or
      litigation, and, to the Company’s Knowledge, no such action is
      threatened.  No patent of the Company or its Subsidiaries is involved
      in any interference, reissue, reexamination or opposition
      proceeding.

    

    (b)           All
      of the licenses and sublicenses and consent, royalty or other agreements
      concerning Intellectual Property which are necessary for the conduct of the
      Company’s and each of its Subsidiaries’ respective businesses as currently
      conducted or currently planned to be conducted to which the Company or any
      Subsidiary is a party or by which any of their assets are bound (other than
      generally commercially available, non-custom, off-the-shelf software application
      programs) (collectively, “License Agreements”) are valid and binding obligations
      of the Company or its Subsidiaries that are parties thereto and, to the
      Company’s Knowledge, the other parties thereto, enforceable in accordance with
      their terms, except to the extent that enforcement thereof may be limited by
      bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
      other similar laws affecting the enforcement of creditors’ rights generally, and
      there exists no event or condition which constitutes a material violation or
      breach of or constitute (with or without due notice or lapse of time or both)
      a
      default by the Company or any of its Subsidiaries under any such License
      Agreement.

    

    (c)           The
      Company and its Subsidiaries own or have the valid right to use all of the
      Intellectual Property that is necessary for the conduct of the Company’s and
      each of its Subsidiaries’ respective businesses as currently conducted or
      currently proposed to be conducted and for the ownership, maintenance and
      operation of the Company’s and its Subsidiaries’ properties and assets, which
      ownership or right is, except as disclosed in the SEC Filings, free and clear
      of
      all liens, encumbrances, adverse claims or obligations to license (as licensor)
      all such owned Intellectual Property, other than licenses entered into in the
      ordinary course of the Company’s and its Subsidiaries’ businesses.

     

     

    
      
        
        

      

      
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    (d)           To
      the Company’s Knowledge, the conduct of the Company’s and its Subsidiaries’
businesses as currently conducted does not infringe or otherwise impair or
      conflict with (collectively, “Infringe”) any Intellectual Property rights of any
      third party or any confidentiality obligation owed to a third party, and, to
      the
      Company’s Knowledge, the Intellectual Property and Confidential Information of
      the Company and its Subsidiaries which are necessary for the conduct of
      Company’s and each of its Subsidiaries’ respective businesses as currently
      conducted are not being Infringed in any material respect by any third
      party.  There is no litigation or order pending or outstanding against
      the Company or, to the Company’s Knowledge, threatened or imminent against the
      Company, that seeks to limit or challenge or that concerns the ownership, use,
      validity or enforceability of any Intellectual Property of the Company and
      its
      Subsidiaries and the Company’s and its Subsidiaries’ use of any Intellectual
      Property owned by a third party, and, to the Company’s Knowledge, there is no
      valid basis for the same.

    

    (e)           The
      consummation of the transactions contemplated hereby and by the other
      Transaction Documents will not result in the alteration, loss, impairment of
      or
      restriction on the Company’s or any of its Subsidiaries’ ownership or right to
      use any of the Intellectual Property or Confidential Information which is
      necessary for the conduct of the Company’s and each of its Subsidiaries’
respective businesses as currently conducted or as currently proposed to be
      conducted.

    

    (f)           All
      software owned by the Company or any of its Subsidiaries, and, to the Company’s
      Knowledge, all software licensed from third parties by the Company or any of
      its
      Subsidiaries that is material to the conduct of the Company’s and its
      Subsidiaries’ business as currently conducted (i) is free from any material
      defect, bug, virus, or programming, design or documentation error; (ii) operates
      and runs in a reasonable and efficient business manner; and (iii) conforms
      in
      all material respects to the specifications and purposes thereof.

    

    (g)           The
      Company and its Subsidiaries have taken reasonable steps to protect the
      Company’s and its Subsidiaries’ rights in their Intellectual Property and
      Confidential Information.  Each employee, consultant and contractor
      who has had access to Confidential Information, the continued confidentiality
      of
      which is necessary for the conduct of the Company’s and each of its
      Subsidiaries’ respective businesses as currently conducted has executed an
      agreement to maintain the confidentiality of such Confidential Information
      or is
      subject to a fiduciary duty requiring that such confidentiality be
      maintained.  Except under confidentiality obligations, to the
      Company’s knowledge, there has been no material disclosure by the Company of any
      of the Company’s or its Subsidiaries’ Confidential Information to any third
      party.  The Company and its Subsidiaries have secured from all parties
      (including employees thereof) who have created any portion of, or who would
      otherwise have any ownership rights in or to, the Company’s and its
      Subsidiaries’ Intellectual Property valid and enforceable written assignments of
      any such work, invention, improvement or other rights to the Company and each
      Subsidiary.

     

     

    
      
        
        

      

      
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    4.19           Environmental
      Matters.  Neither the Company nor any Subsidiary is in violation
      of any statute, rule, regulation, decision or order of any governmental agency
      or body or any court, domestic or foreign, relating to the use, disposal or
      release of hazardous or toxic substances or relating to the protection or
      restoration of the environment or human exposure to hazardous or toxic
      substances (collectively, “Environmental Laws”), owns or, to the Company’s
      knowledge, operates any real property contaminated with any substance that
      is
      subject to any Environmental Laws, is liable for any off-site disposal or
      contamination pursuant to any Environmental Laws, and is subject to any claim
      relating to any Environmental Laws, which violation, contamination, liability
      or
      claim has had or could reasonably be expected to have a Material Adverse Effect,
      individually or in the aggregate; and there is no pending or, to the Company’s
      Knowledge, threatened investigation that could reasonably be expected to lead
      to
      such a claim.  None of the following exists at any property or
      facility owned or operated (whether by fee interest, leasehold interest, or
      otherwise) by the Company: (a) under or above-ground storage tanks, (b) asbestos
      containing material in any form or condition, (c) materials or equipment
      containing polychlorinated biphenyls, or (d) landfills, surface impoundments,
      or
      disposal areas.  Neither the Company nor any of its Predecessors or
      Affiliates has treated, recycled, stored, disposed of, arranged for or permitted
      the disposal of, transported, handled, or released any substance, including
      any
      Hazardous Materials, or owned or operated any property or facility (and no
      such
      property or facility is contaminated by any such substance) in a manner that
      has
      given or would give rise to any claim for damages, including any damages for
      response costs, corrective action costs, personal injury, property damage or
      natural resources damages, pursuant to any Environmental Laws.  For
      this section “Hazardous Materials” means any substance, pollutant, contaminant,
      material, or waste, or combination thereof, whether solid, liquid, or gaseous
      in
      nature, subject to regulation, investigation, control, or remediation under
      any
      Environmental Laws.  Neither the Company nor any of its Predecessors
      or Affiliates has, either expressly or by operation of law, assumed or
      undertaken any liability, including any obligation for corrective or remedial
      action, of any other person relating to Environmental Laws.  No facts,
      events or conditions relating to the past or present facilities, properties
      or
      operations of the Company, nor any of its Predecessors or Affiliates, will
      prevent, hinder, or limit continued compliance with any applicable Environmental
      Laws or give rise to any damages or any other liabilities under any
      Environmental Laws.

    

    4.20           Litigation.  There
      are no pending actions, suits or proceedings against or affecting the Company,
      its Subsidiaries or any of its or their properties that could, if decided
      adversely to the Company, reasonably be expected to have a Material Adverse
      Effect, and to the Company’s Knowledge, no such actions, suits or proceedings
      are threatened or contemplated.  There are not pending governmental or
      other investigations or enquiries or proceedings concerning the Company, its
      Subsidiaries or any of their properties that could, if decided adversely to
      the
      Company, reasonably be expected to have a Material Adverse Effect, and to the
      Company’s Knowledge, no such investigations, enquiries or proceedings are
      threatened or contemplated.

    

    4.21           Financial
      Statements.  The financial statements included in each SEC Filing
      comply with the rules and regulations of the SEC with respect thereto (including
      accounting requirements) as in effect at the time of filing of such reports
      and
      present fairly, in all material respects, the consolidated financial position
      of
      the Company as of the dates shown and its consolidated results of operations
      and
      cash flows for the periods shown.  Such financial statements have been
      prepared in conformity with United States generally accepted accounting
      principles applied on a consistent basis during the periods involved (“GAAP”)
      (except as may be disclosed therein or in the notes thereto, and, in the case
      of
      quarterly financial statements, as permitted by Form 10-Q under the 1934
      Act).  Except as set forth in the financial statements of the Company
      included in the SEC Filings filed prior to the Effective Date, neither the
      Company nor any of its Subsidiaries has incurred any liabilities, contingent
      or
      otherwise, except those incurred in the ordinary course of business, consistent
      (as to amount and nature) with past practices since the date of such financial
      statements, none of which, individually or in the aggregate, have had or could
      reasonably be expected to have a Material Adverse Effect.  The Company
      recognizes revenue consistent with GAAP.

     

     

    
      
        
        

      

      
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    4.22           Undisclosed
      Liabilities.  The Company has no liability that would be required
      by GAAP to be set forth on a balance sheet other than (a) liabilities reflected
      in the SEC Filings, (b) accounts payable and accrued expenses accruing after
      September 30, 2007 in the ordinary course of business or in accordance with
      this
      Agreement, or (c) liabilities otherwise reflected herein or in the Disclosure
      Letter.

    

    4.23           Insurance
      Coverage.  The Company and each Subsidiary maintains in full force
      and effect insurance coverage for the business being conducted and properties
      owned or leased by the Company and each Subsidiary that the Company believes
      is
      adequate against all liabilities, claims and risks against which would be
      prudent, given the totality of the circumstances, for the Company to insure.
      The
      premiums for the insurance policies have been fully paid.  The
      insurance afforded under such policies is comparable in type of coverage to
      that
      maintained by persons engaged in the manufacturing processes similar to that
      engaged in by the Company and in amounts comparable to manufacturing entities
      of
      similar size engaged in similar processes. Such policies are in full force
      and
      effect and will remain so through the Final Closing.  None of such
      insurance policies are subject to retroactive premium adjustment in
      respect of prior periods.

    

    4.24           Product
      Warranty. The reserves set forth in the financial
      statements of the Company are sufficient to cover any liability associated
      with
      the failure of any product manufactured, sold, leased, or delivered by the
      Company to be in conformity with all applicable laws, contracts, and all express
      and implied warranties.  No product designed, manufactured, sold,
      leased, or delivered by the Company is subject to any guaranty, warranty, or
      other indemnity or similar liability beyond the guaranties, warranties and
      indemnities set forth in governing agreements.

    

    4.25           Product
      Liability.  The Company does not have any liability (and, to the
      Knowledge of the Company, there is no basis for any present or future action
      against the Company giving rise to any liability) arising out of any injury
      to
      individuals or property as a result of the ownership, possession, or use of
      any
      product designed, manufactured, sold, leased, or delivered by the
      Company.

    

    4.26           Listing.  The
      Company’s Common Stock is quoted on the NASDAQ Capital Market.  The
      Company has not received any oral or written notice that its Common Stock will
      be delisted from the NASDAQ Capital Market nor that its Common Stock does not
      meet all requirements for the continuation of such quotation and the Company
      satisfies the requirements for the continued listing of its Common Stock on
      the
      NASDAQ Capital Market.

     

     

    
      
        
        

      

      
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    4.27           Brokers
      and Finders.  No Person will have, as a result of actions or
      omissions of the Company in connection with the transactions contemplated by
      the
      Transaction Documents, any valid right, interest or claim against or upon the
      Company, any Subsidiary or an Investor for any commission, fee or other
      compensation pursuant to any agreement, arrangement or understanding entered
      into by or on behalf of the Company, other than as described in Section 4.21
      of
      the Disclosure Letter.

    

    4.28           No
      Directed Selling Efforts or General Solicitation.  In connection
      with the offer or sale of any of the Shares Neither the Company nor any Person
      acting on its behalf has conducted (a) any general solicitation or general
      advertising (as those terms are used in Regulation D promulgated by the SEC
      (“Regulation D”)), or (b) any direct selling efforts (as that term is used in
      Regulation S).

    

    4.29           Private
      Placement.  Subject to the accuracy of the representations and
      warranties of the Investor in Section 5, the offer and sale of the Shares to
      the
      Investor as contemplated hereby is exempt from the registration requirements
      of
      the 1933 Act is being made pursuant to the exemption afforded by Regulation
      S.  The Company agrees not to register any transfer of the Shares not
      made in accordance with the provisions of Regulation S.

    

    4.30           Questionable
      Payments.  Neither the Company nor any
      of its Subsidiaries nor, to the Company’s Knowledge, any of their respective
      current or former shareholders, directors, officers, employees, agents or other
      Persons acting on behalf of the Company or any Subsidiary, has on behalf of
      the
      Company or any Subsidiary or in connection with their respective
      businesses:  (a) used any corporate funds for unlawful contributions,
      gifts, entertainment or other unlawful expenses relating to political activity;
      (b) made any direct or indirect unlawful payments to any governmental officials
      or employees from corporate funds; (c) established or maintained any unlawful
      or
      unrecorded fund of corporate monies or other assets; (d) made any false or
      fictitious entries on the books and records of the Company or any Subsidiary;
      or
      (e) made any unlawful bribe, rebate, payoff, influence payment, kickback or
      other unlawful payment of any nature.

    

    4.31           Transactions
      with Affiliates.  Except as disclosed in the SEC Filings or
      filings made by Affiliates of the Company on EDGAR pursuant to the 1934 Act,
      none of the officers or directors of the Company and, to the Company’s
      Knowledge, none of the employees of the Company is presently a party to any
      transaction with the Company or any Subsidiary (other than as holders of capital
      stock, stock options, warrants and/or other rights convertible into or
      exercisable for capital stock, and for services as employees, officers and
      directors), that is required by governing rules to be disclosed in any SEC
      Filings or filing by an Affiliate of the Company.

    

     

    
      
        
        

      

      
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      4.32           Internal
        Controls.  The Company and the Subsidiaries maintain a system of
        internal accounting controls sufficient to provide reasonable assurance that
        (i)
        transactions are executed in accordance with management’s general or specific
        authorizations, (ii) transactions are recorded as necessary to permit
        preparation of financial statements in conformity with generally accepted
        accounting principles and to maintain asset accountability, (iii) access
        to
        assets is permitted only in accordance with management’s general or specific
        authorization, and (iv) the recorded accountability for assets is compared
        with
        the existing assets at reasonable intervals and appropriate action is taken
        with
        respect to any differences.  The Company has established disclosure
        controls and procedures (as defined in 1934 Act Rules 13a-14 and 15d-14)
        for the
        Company and designed such disclosure controls and procedures to ensure that
        material information relating to the Company, including the Subsidiaries,
        is
        made known to the certifying officers by others within those entities,
        particularly during the period in which the Company’s most recently filed period
        report under the 1934 Act, as the case may be, is being prepared.  The
        Company’s certifying officers have evaluated the effectiveness of the Company’s
        controls and procedures as of a date within 90 days prior to the filing date
        of
        the most recently filed periodic report under the 1934 Act (such date, the
        “Evaluation Date”).  The Company presented in its most recently filed
        periodic report under the 1934 Act the conclusions of the certifying officers
        about the effectiveness of the disclosure controls and procedures based on
        their
        evaluations as of the Evaluation Date.  Since the Evaluation Date,
        there have been no significant changes in the Company’s internal controls (as
        such term is defined in Item 307(b) of Regulation S-K) or, to the Company’s
        Knowledge, in other factors that could significantly affect the Company’s
        internal controls.  The Company maintains and will continue to
        maintain a standard system of accounting established and administered in
        accordance with GAAP and the applicable requirements of the 1934
        Act.

    

     

    4.33           No
      Manipulation of Stock.  Neither the Company, nor any of its
      directors, officers or Controlling Persons (other than Persons that become
      Controlling Persons as a result of the transactions contemplated by this
      Agreement), has taken or will, in violation of applicable law, take, any action
      designed to or that might reasonably be expected to cause or result in, or
      which
      has constituted, stabilization or manipulation of the price of the Common Stock
      to facilitate the sale or resale of the Shares.

    

    4.34           Company
      Not an “Investment Company”.  The Company has been advised of the
      rules and requirements under the Investment Company Act of 1940, as amended
      (the
“Investment Company Act”).  The Company is not, and immediately after
      receipt of payment for the Shares will not be, an “investment company” or
      (except to the extent one of the Investor is an “investment company”) an entity
“controlled” by an “investment company” within the meaning of the Investment
      Company Act and (except to the extent one of the Investor is an “investment
      company”) shall conduct its business in a manner so that it will not become
      subject to the Investment Company Act.

    

    4.35           Contracts.  The
      contracts described in the SEC Filings that are currently material to the
      Company are in full force and effect on the Effective Date, and, except as
      described in the SEC Filings, neither the Company nor, to the Company’s
      Knowledge, any other party to such contracts is in breach of or default under
      any of such contracts which would have a Material Adverse Effect.

     

     

    
      
        
        

      

      
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    4.36           Insolvency.  No
      order has been made or petition presented or resolution passed for the winding
      up of the Company or for the appointment of a provisional liquidator to the
      Company or for an administration order in respect of the Company.  No
      receiver and manager has been appointed by any person of the whole or any part
      of the business or assets of the Company.

    

    4.37           Disclosures.  Neither
      the Company nor any Person acting on its behalf has provided the Investor or
      its
      agents or counsel with any information that constitutes or might constitute
      material, non-public information, unless the Investor requested any such
      information and executed and delivered to the Company a confidentiality and
      non-disclosure agreement in respect of such information prior to its disclosure
      to the Investor.  The written materials delivered to the Investor in
      connection with the transactions contemplated by the Transaction Documents
      and
      the Transaction Documents themselves (including the exhibits and schedules
      thereto and the Disclosure Letter) do not contain any untrue statement of a
      material fact or omit to state a material fact necessary in order to make the
      statements contained therein, in light of the circumstances under which they
      were made, not misleading.  The information set out in this Agreement
      and the Disclosure Letter (including any annexures to the Disclosure Letter)
      is
      true, accurate, complete and not misleading.  The Company has provided
      all information requested by the Investor and not omitted to disclose any
      information which would be material to a purchase of shares in a transaction
      of
      the nature contemplated hereby.  For purposes of the preceding
      sentence, the Company shall be deemed to have disclosed to the Investor all
      information contained in the SEC Filings; provided, however, no information
      contained in the SEC Filings shall constitute an exception in respect of any
      representation or warranty set out in Section 4.1 through 4.36 inclusive unless,
      and only to the extent, expressly referenced or incorporated by reference in
      such representation or warranty.

    

    5.           Representations
      and Warranties of the Investor.  The Investor hereby represents
      and warrants to the Company that:

    

    5.1           Organization
      and Existence.  The Investor is a validly existing limited
      liability company and has all requisite limited liability company power and
      authority to invest in the Shares pursuant to this Agreement.

    

    5.
      2           Authorization.  The
      execution, delivery and performance by the Investor of the Transaction Documents
      have been duly authorized and will each constitute the valid and legally binding
      obligation of the Investor, enforceable against the Investor in accordance
      with
      their respective terms, subject to bankruptcy, insolvency, fraudulent transfer,
      reorganization, moratorium and similar laws of general applicability, relating
      to or affecting creditors’ rights generally.

    

    5.
      3           Purchase
      Entirely for Own Account.  The Shares to be received by the
      Investor hereunder will be acquired for the Investor’s own account, not as
      nominee or agent, and not with a view to the resale or distribution of any
      part
      thereof in violation of the 1933 Act, and the Investor has no present intention
      of selling, granting any participation in, or otherwise distributing the same
      in
      violation of the 1933 Act.  Except as disclosed in writing on the
      signature page of the Investor to this Agreement, the Investor is not a
      registered broker dealer or an entity engaged in the business of being a broker
      dealer.

    
 

    
      
        
        

      

      
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    5.
      4           Investment
      Experience.  The Investor acknowledges that it can bear the
      economic risk and complete loss of its investment in the Shares and has such
      knowledge and experience in financial or business matters that it is capable
      of
      evaluating the merits and risks of the investment contemplated
      hereby.

    

    5.
      5           Disclosure
      of Information.  The Investor has had an opportunity to receive
      all additional information related to the Company requested by it and to ask
      questions of and receive answers from the Company regarding the Company, its
      business and the terms and conditions of the offering of the
      Shares.  The Investor acknowledges receipt of copies of the SEC
      Filings.  Neither such inquiries nor any other due diligence
      investigation conducted by the Investor shall modify, amend or affect the
      Investor’s right to rely on the Company’s representations and warranties
      contained in this Agreement.

    

    5.
      6           Restricted
      Securities/ Hedging Restrictions.  In addition to complying with
      all other restrictions set forth herein, the Investor agrees to resell the
      Shares only (and acknowledges and agrees that the Company shall be required
      to
      refuse to register any resale or other transfer of the Shares not made) in
      accordance with the provisions of Regulation S, pursuant to registration under
      the 1933 Act or pursuant to an available exemption from such
      registration.  The Investor acknowledges that, among other
      restrictions, Regulation S prohibits the transfer of the Shares to, or for
      the
      account or benefit of, any U.S. person or within the United
      States.  The Investor will not engage in any hedging transactions
      involving the Shares except in compliance with Regulation S.

    

    5.7           Legends.  It
      is understood that, except as provided below, certificates evidencing the Shares
      may bear the following or any similar legend:

    

    (a)           THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD, TRANSFERRED,
      ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE
      WITH REGULATION S PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION
      UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
      REGISTRATION.  ANY SUCH DISPOSITION MADE WITHOUT REGISTRATION UNDER
      THE SECURITIES ACT SHALL NOT BE MADE UNLESS THE COMPANY HAS RECEIVED AN OPINION
      OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY AND ITS COUNSEL,
      THAT
      SUCH REGISTRATION IS NOT REQUIRED.  HEDGING TRANSACTIONS INVOLVING THE
      SECURITIES REPRESENTED HEREBY SHALL NOT BE CONDUCTED UNLESS IN ACCORDANCE WITH
      REGULATION S UNDER THE SECURITIES ACT.

    

    (b)           If
      required by the laws and regulations of Canada, any state or any province in
      connection with the issuance or sale of the Shares, the legend required by
      such
      law or regulation.

     

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    
 

    Upon
      the earlier of (i) registration
      for resale pursuant to the Registration Rights Agreement and receipt by the
      Company of the Investor’s written confirmation that such Shares have been
      disposed in compliance with the prospectus delivery requirements of the 1933
      Act
      or (ii) Rule 144(k) or successor provision becoming available, the Company
      shall, upon an Investor’s written request, promptly cause certificates
      evidencing the Shares to be replaced with certificates which do not bear such
      restrictive legends.

    

    5.8           Non
      US Person.  The Investor is not a "U.S. Person" (as defined in
      Regulation S) and is not acquiring the Shares for the account or benefit of
      any
      U.S. Person.  Without limiting the generality of the foregoing, the
      Investor is not acquiring the Shares for the account or benefit of any of the
      following:  (i) a natural person resident in the United States, (ii) a
      partnership or corporation organized or incorporated under the laws of the
      United States or formed by a U.S. Person principally for the purpose of
      investing in securities not registered under the 1933 Act, (iii) an estate
      of
      which any executor or administrator is a U.S. Person, (iv) a trust of which
      any
      trustee is a U.S. Person, (v) an agency or branch of a foreign entity located
      in
      the United States, (vi) a non-discretionary account or similar account held
      by a
      dealer or other fiduciary for the benefit or account of a U.S. Person, or (vii)
      a non-discretionary account or similar account held by a dealer or other
      fiduciary organized, incorporated, or resident in the United
      States.  The Investor is domiciled in the United Arab Emirates and has
      no present intention of becoming a resident of any other country.  The
      Investor was not solicited to purchase the Shares while present in the United
      States.  The Investor was outside the United States at the time of
      executing this Agreement and delivering it to the Company.

    

    5.9           No
      General Solicitation.  The Investor did not learn of the
      investment in the Shares as a result of any advertisement, article, notice
      or
      other communication regarding the Shares published in any newspaper, magazine
      or
      similar media or broadcast over television or radio or presented at any
      seminar.

    

    5.10           Brokers
      and Finders.  No Person will have, as a result of the transactions
      contemplated by the Transaction Documents, any valid right, interest or claim
      against or upon the Company, any Subsidiary or an Investor for any commission,
      fee or other compensation pursuant to any agreement, arrangement or
      understanding entered into by or on behalf of the Investor.

    

    5.11           Prohibited
      Transactions.  During the last thirty (30) days prior to the
      Effective Date, the Investor has not, directly or indirectly, nor has the
      Investor made any recommendation or suggestion regarding trading in the Common
      Stock to or known of any Person who has, effected or agreed to effect any short
      sale, whether or not against the box, established any “put equivalent position”
(as defined in Rule 16a-1(h) under the 1934 Act) with respect to the Common
      Stock, granted any other right (including, without limitation, any put or call
      option) with respect to the Common Stock or with respect to any security that
      includes, relates to or derives any significant part of its value from the
      Common Stock or otherwise sought to hedge its position in the Shares (each,
      a
“Prohibited Transaction”).

     

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    
 

    5.12           Compliance
      with Domestic Law.  The offer, sale and purchase of the Shares
      pursuant to this Agreement does not and will not violate any laws of the
      Investor’s jurisdiction of domicile and incorporation, including without
      limitation, any securities laws or  foreign exchange or foreign
      investment laws, and no governmental or other third party consents need to
      be
      obtained under the laws of Investor’s jurisdiction in connection with this
      Agreement and the closing of the transactions contemplated
      hereunder.

    

    6.  Conditions
      to
      Closing.

    

    6.1           Conditions
      to the Investor’s Obligations.  The obligation of the Investor to
      purchase the Shares at each Closing is subject to the fulfillment, on or prior
      to the respective Closing Date, of the following conditions, any of which may
      be
      waived by the Investor:

    

    (a)           The
      representations and warranties made by the Company in Section 4 hereof shall
      be
      true and correct on the Effective Date and on the respective Closing Date,
      except to the extent any such representation or warranty expressly speaks as
      of
      a different date, in which case such representation or warranty shall be true
      and correct as of such different date.  The Company shall have
      performed in all material respects all obligations and conditions herein
      required to be performed or observed by it on or prior to the respective Closing
      Date.

    

    (b)           Since
      the date of this Agreement, there shall not have occurred any events,
      occurrences, changes, effects or conditions of any character which, individually
      or in the aggregate, have had or could reasonably be expected to have, in the
      Investor’s opinion (acting reasonably), a Material Adverse Effect on the
      Company.

    

    (c)           The
      Company shall have obtained in a timely fashion any and all consents, permits,
      approvals, and waivers necessary or appropriate for consummation of the purchase
      and sale of the Shares and the consummation of the other transactions
      contemplated by the Transaction Documents, all of which shall be in full force
      and effect (except for filings referenced as post-closing filings and described
      in Section 4.5).

    

    (d)           The
      Company shall have executed and delivered the Registration Rights
      Agreement.

    

    (e)           No
      judgment, writ, order, injunction, award or decree of or by any court, or judge,
      justice or magistrate, including any bankruptcy court or judge, or any order
      of
      or by any governmental authority, shall have been issued, and no action or
      proceeding shall have been instituted by any governmental authority, enjoining
      or preventing the consummation of the transactions contemplated hereby or in
      the
      other Transaction Documents.

    

    (f)           The
      Company shall have delivered at the Initial Closing to the Investor a copy
      of a
      Certificate, executed on behalf of the Company by its Chief Executive Officer
      or
      its Chief Financial Officer, dated as of the Initial Closing Date, certifying
      to
      the fulfillment of the conditions specified in subsections (a), (b), (c) and
      (e)
      of this Section 6.1.

     

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    
 

    (g)           The
      Company shall have delivered to the Investor at the Initial Closing a copy
      of a
      Certificate, executed on behalf of the Company by its Secretary, dated as of
      the
      Initial Closing Date, certifying the resolutions adopted by the Board of
      Directors of the Company approving the transactions contemplated by this
      Agreement and the other Transaction Documents and the issuance of the Shares,
      certifying the current versions of the Articles of Continuance and Bylaws of
      the
      Company and certifying as to the signatures and authority of persons signing
      the
      Transaction Documents and related documents on behalf of the
      Company.

    

    (h)           The
      Investor shall have received opinion letters from Canadian and U.S. legal
      counsel for the Company, dated as of the Initial Closing Date, in form and
      substance reasonably acceptable to the Investor to and collectively contains
      affirmative opinions in substantially  the effect  set forth
      in Exhibit B.

    

    (i)           No
      stop order or suspension of trading shall have been imposed by the SEC or any
      other governmental regulatory body or the NASDAQ Capital Market with respect
      to
      public trading in the Common Stock.

    

    6.2           Conditions
      to Obligations of the Company.  The Company’s obligation to sell
      and issue the Shares at each Closing to the Investor is subject to the
      fulfillment to the satisfaction of the Company on or prior to the respective
      Closing Date of the following conditions with respect to the Investor, any
      of
      which may be waived by the Company:

    

    (a)           The
      representations and warranties made by the Investor in Section 5 hereof shall
      be
      true and correct in all respects when made and shall be true and correct in
      all
      respects on the respective Closing Date with the same force and effect as if
      they had been made on and as of said date.  The Investor shall have
      performed in all material respects all obligations and conditions herein
      required to be performed or observed by it on or prior to the respective Closing
      Date.

    

    (b)           The
      Investor shall have executed and delivered the Registration Rights
      Agreement.

    

    (c)           The
      Investor shall have delivered the portion of the Purchase Price to the Company
      due on the respective Closing Date.

    

    (d)           No
      judgment, writ, order, injunction, award or decree of or by any court, or judge,
      justice or magistrate, including any bankruptcy court or judge, or any order
      of
      or by any governmental authority, shall have been issued, and no action or
      proceeding shall have been instituted by any governmental authority, enjoining
      or preventing the consummation of the transactions contemplated hereby or in
      the
      other Transaction Documents.

    

    6.3           Termination
      of Obligations to Effect Closing; Effects.

    

    (a)           The
      obligations of the Company, on the one hand, and the Investor, on the other
      hand, to effect the Closing shall terminate as follows:

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    
 

    (i)           Upon
      the mutual written consent of the Company and the Investor;

    

    (ii)           By
      the Company if (A) any of the conditions set forth in Section 6.2 shall have
      become incapable of fulfillment, and shall not have been waived by the Company,
      or (B) the Company has satisfied all conditions set forth in Section 6.1 with
      respect to the respective Closing and the Closing has not occurred prior to
      5:00
      P.M. New York time on the deadline set forth in Section 3 with respect for
      the
      respective Closing Date.

    

    By
      the
      Investor if (A) any of the conditions set forth in Section 6.1 shall have become
      incapable of fulfillment, and shall not have been waived by the Investor, or
      (B)
      the Investor has satisfied all conditions set forth in Section 6.2 with respect
      to the respective Closing and the Closing has not occurred prior to 5:00 P.M.
      New York time on the deadline set forth in Section 3 with respect for the
      respective Closing Date.

    

    (iii)           By
      the Investor if the Company is in breach of any of the representations and
      warranties set forth in Section 4.

    

    provided,
      however, that, except in the case of clauses (ii), (iii) or (iv) above, the
      party seeking to terminate its obligation to effect the Closing shall not then
      be in breach of any of its representations, warranties, covenants or agreements
      contained in this Agreement or the other Transaction Documents if such breach
      has resulted in the circumstances giving rise to such party’s seeking to
      terminate its obligation to effect the Closing.

    

    (b)           If
      the Investor terminates this Agreement pursuant to clause (iii) or (iv)
      above, the Company shall reimburse the Investor for all attorneys fees relating
      to the negotiation, preparation, execution or termination of the Transaction
      Documents.

    

    (c)           Nothing
      in this Section 6.3 shall be deemed to release any party from any liability
      for
      any breach by such party of the terms and provisions of this Agreement or the
      other Transaction Documents or to impair the right of any party to compel
      specific performance by any other party of its obligations under this Agreement
      or the other Transaction Documents.

    

    7.           Covenants
      and Agreements of the Company.

    

    7.1           No
      Conflicting Agreements.  The Company will not take any action,
      enter into any agreement or make any commitment that would conflict or interfere
      in any material respect with the Company’s obligations to the Investor under the
      Transaction Documents, including without limitation, any action or steps that
      would cause the offer and/or sale of the Shares to be integrated with other
      offerings.  The Company will not conduct any offering other than the
      transactions contemplated hereby that will be integrated with the offer or
      issuance of the Shares.

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

     

    

    7.2           Compliance
      with Laws.  The Company will comply in all material respects with
      all applicable laws, rules, regulations, orders and decrees of all governmental
      authorities.

    

    7.3           Listing
      of Underlying Shares and Related Matters.  Promptly following the
      Closing, the Company shall take all necessary action to cause the Shares to
      be
      listed on each national securities exchange, or quotation system, if any, upon
      which shares of Common Stock are then listed (subject to official notice of
      issuance) and shall maintain such listing so long as any shares of Common Stock
      are listed on such exchange or quotation system. The Company will maintain
      the
      listing of its Common Stock on the NASDAQ Capital Market or, in its discretion,
      the American Stock Exchange, NASDAQ Global Market or New York Stock Exchange
      (any such exchange on which the Common Stock is listed, the “Principal
      Market”) and will comply in all respects with the Company’s reporting,
      filing and other obligations under the bylaws or rules of the Principal Market,
      provided that the foregoing shall not prohibit the Company from delisting if
      at
      any time as a result of a change of control or otherwise the Company is no
      longer required to register its Common Stock under Section 12 of the 1934 Act.
      The Company will provide within two (2) Business Days to the Investor copies
      of
      all notices it receives notifying the Company of the threatened and actual
      delisting of the Common Stock from the Principal Market.

    

    7.4           Market
      Regulations.  The Company shall notify the SEC, the Principal
      Market and applicable state authorities, in accordance with their requirements,
      of the transactions contemplated by this Agreement, and shall take all other
      necessary action and proceedings as may be required and permitted by applicable
      law, rule and regulation, for the legal and valid issuance of the Shares to
      the
      Investor.

    

    7.5           Termination
      of Covenants.  The provisions of Sections 7.1 through 7.4 shall
      terminate and be of no further force and effect upon the earlier of (i) the
      mutual consent of the Company and the Investor or (ii) the date on which the
      Company’s obligations under the Registration Rights Agreement to register or
      maintain the effectiveness of any registration covering the Registrable
      Securities (as such term is defined in the Registration Rights Agreement) shall
      terminate.

    

    7.6           Prohibited
      Transactions.  Prior to the earliest of (i) the termination
      of this Agreement, (ii) the date on which the Registration Statement has
      been declared effective, and (iii) the Effectiveness Deadline, the Investor
      shall not engage, directly or indirectly, nor shall any Person acting on behalf
      of or pursuant to any understanding with the Investor engage, in a Prohibited
      Transaction.  The Investor acknowledges and agrees that in order to
      enforce the foregoing covenant, the Company may impose stop-transfer
      instructions with respect to any of the Common Stock of the Investor or its
      transferee until such time as the Registration Statement has been declared
      effective.

    

    8.           Lock-up;
      Leak-out.

    

    8.1           Lock-Up.  In
      addition to any restrictions and limitations required by applicable securities
      laws, rule and regulations, Investor shall not at any time offer, sale, pledge,
      conveyance, transfer or make commitment to do any of the foregoing (each a
      “Transfer”) any of the Shares that are of Lock-Up Shares (as defined
      below).

     

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

    
 

    8.2           Leak-Out.

    

    (a)           Prior
      to and including the second anniversary of the Closing, all of the Shares shall
      be Lock-Up Shares and shall be subject to the restriction on Transfer set forth
      in Section 8.1.

    

    (b)           Following
      the second anniversary of the Closing, two-thirds (round up to the nearest
      Share) of the Shares shall be Lock-Up Shares and shall be subject to the
      restriction on Transfer set forth in Section 8.1.

    

    (c)           Following
      the third anniversary of the Closing, one-third (round up to the nearest Share)
      of the Shares shall be Lock-Up Shares and shall be subject to the restriction
      on
      Transfer set forth in Section 8.1

    

    (d)           Following
      the fourth anniversary of the Closing, none of the Shares of the Shares shall
      be
      Lock-Up Shares.

    

    8.3           Legends.  In
      addition to any other legend placed on the Shares pursuant to this Agreement,
      the following legend shall be imprinted on each stock certificate representing
      a
      Lock-Up Share (with the “Applicable Date” to be the date on which the Shares
      represented by the particular certificate cease to be Lock-Up
      Shares):

    

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CONTRACTUAL
      PROHIBITIONS ON TRANSFER CONTAINED IN A PURCHASE AGREEMENT BETWEEN THE ISSUER
      AND THE ORIGINAL PURCHASER OF SUCH SECURITIES.  SUCH CONTRACTUAL
      PROHIBITIONS EXPIRE ON [APPLICABLE DATE], AT WHICH TIME THIS LEGEND MAY BE
      REMOVED. A COPY OF SUCH AGREEMENT IS AVAILABLE FROM THE ISSUER UPON
      REQUEST.

    

    Upon
      any
      Share’s ceasing the be a Lock-Up Share, the Company shall, upon an Investor’s
      written request, promptly cause certificates evidencing the Shares to be
      replaced with certificates which do not bear such restrictive
      legend.

    

    8.4           Stop
      Transfer Instructions. The Company may place stop transfer instructions on
      the Shares so as to restrict the Transfer of the Shares except in accordance
      with the terms of this Agreement.

    

    8.5           Permitted
      Transfers during Lock-Up/Leak-Out Period.  Notwithstanding
      anything contained in this Section 8, the Investor may transfer Lock-Up Shares
      to its Affiliates or subsidiaries provided that the transferee executes an
      agreement to be bound by all the terms and conditions of this Agreement in
      connection with the Shares acquired.

     

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

    
 

    8.6           Beneficial
      Rights; Additional Resale Restrictions. Except as otherwise provided in this
      Agreement or any other agreements between the parties hereto, the Investor
      shall
      be entitled to its beneficial rights of ownership of the Shares, including
      the
      right to vote the Shares for any and all purposes.  The resale
      restrictions on the Shares set forth in this Agreement shall be in addition
      to
      all other restrictions on transfer imposed by applicable United States and
      state
      securities laws, rules and regulations.

    

    9.           Survival
      and Indemnification.

    

    9.1         
      Survival.  The representations and warranties contained in this
      Agreement shall survive the Closing of the transactions contemplated by this
      Agreement, to the extent the Closing occurs, for a period of one year from
      the
      Closing Date.  Unless terminated as provided in the following
      sentence, the covenants and other provisions of this Agreement shall survive
      during the terms set forth with respect thereto in this Agreement, and if no
      such term is set forth herein, for one year from the date of
      Closing.  With respect to all parties, if the Closing does not occur,
      no representations, warranties, covenants or agreements shall survive
      termination under Section 6.3.

    

    9.2          
      Indemnification.

    

    (a)           The
      Company agrees to indemnify and hold harmless the Investor and its Affiliates
      and their respective manager, members, employees and agents from and against
      any
      and all losses, claims, damages, liabilities and expenses (including without
      limitation reasonable attorneys’ fees and disbursements and other expenses
      incurred in connection with investigating, preparing or defending any action,
      claim or proceeding, pending or threatened and the costs of enforcement thereof)
      (collectively, “Losses”) to which such Person may become subject as a
      result of any breach of representation, warranty, covenant or agreement made
      by
      or to be performed on the part of the Company under this Agreement, and will
      reimburse any such Person for all such amounts as they are incurred by such
      Person.

    

    (b)           The
      Investor agrees to indemnify and hold harmless the Company and its Affiliates
      and its directors, officers, employees and agents from and against any and
      all
      Losses to which such Person may become subject as a result of any breach of
      representation, warranty, covenant or agreement made by or to be performed
      on
      the part of the Investor under this Agreement, and will reimburse any such
      Person for all such amounts as they are incurred by such Person.

    

    9.3         
      Conduct of Indemnification Proceedings.  Promptly after receipt
      by any Person (the “Indemnified Person”) of notice of
      any demand, claim or circumstances which would or might give rise to a claim
      or
      the commencement of any action, proceeding or investigation in respect of which
      indemnity may be sought pursuant to Section 9.2, such Indemnified Person shall
      promptly notify the person from which indemnification is sought (the
“Indemnifying Person”) in writing and the Indemnifying Person shall
      assume the defense thereof, including the employment of counsel reasonably
      satisfactory to such Indemnified Person, and shall assume the payment of all
      fees and expenses; provided, however, that the
      failure of any Indemnified Person to so notify promptly the Indemnifying Person
      shall not relieve the Indemnifying Person of its obligations hereunder except
      to
      the extent, and only to the extent, that the Indemnifying Person is materially
      prejudiced by such failure to notify promptly.  In any such
      proceeding, any Indemnified Person shall have the right to retain its own
      counsel, but the fees and expenses of such counsel shall be at the expense
      of
      such Indemnified Person unless: (i) the Indemnifying Person and the Indemnified
      Person shall have mutually agreed to the retention of such counsel; or (ii)
      in
      the reasonable judgment of counsel to such Indemnified Person representation
      of
      both parties by the same counsel would be inappropriate due to actual or
      potential conflicts of interest between them.  The Indemnifying Person
      shall not be liable for any settlement of any proceeding effected without its
      written consent, which consent shall not be unreasonably withheld, but if
      settled with such consent, or if there be a final judgment for the plaintiff,
      the Indemnifying Person shall indemnify and hold harmless such Indemnified
      Person from and against any loss or liability (to the extent stated above)
      by
      reason of such settlement or judgment.  Without the prior written
      consent of the Indemnified Person, which consent shall not be unreasonably
      withheld, the Indemnifying Person shall not effect any settlement of any pending
      or threatened proceeding in respect of which any Indemnified Person is or could
      have been a party and indemnity could have been sought hereunder by such
      Indemnified Party, unless such settlement includes an unconditional release
      of
      such Indemnified Person from all liability arising out of such
      proceeding.

     

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

     

    

    10.           Miscellaneous.

    

    10.1                      Successors
      and Assigns.  This Agreement may not be assigned by a party hereto
      without the prior written consent of the Company or the Investor, as
      applicable.  The provisions of this Agreement shall inure to the
      benefit of and be binding upon the respective permitted successors and assigns
      of the parties.  Nothing in this Agreement, express or implied, is
      intended to confer upon any party other than the parties hereto or their
      respective successors and assigns any rights, remedies, obligations, or
      liabilities under or by reason of this Agreement, except as expressly provided
      in this Agreement.

    

    10.2                      Counterparts;
      Faxes.  This Agreement may be executed in two or more
      counterparts, each of which shall be deemed an original, but all of which
      together shall constitute one and the same instrument.  This Agreement
      may also be executed via facsimile, which shall be deemed an
      original.

    

    10.3                      Titles
      and Subtitles.  The titles and subtitles used in this Agreement
      are used for convenience only and are not to be considered in construing or
      interpreting this Agreement.

    

    10.4                      Notices.  Unless
      otherwise provided, any notice required or permitted under this Agreement shall
      be given in writing and shall be deemed effectively given as hereinafter
      described (i) if given by personal delivery, then such notice shall be deemed
      given upon such delivery, (ii) if given by telex or telecopier, then such notice
      shall be deemed given upon receipt of confirmation of complete transmittal,
      (iii) if given by mail, then such notice shall be deemed given upon the earlier
      of (A) receipt of such notice by the recipient or (B) ten (10)  days
      after such notice is deposited in first class mail, postage prepaid, and (iv)
      if
      given by an internationally recognized overnight air courier, then such notice
      shall be deemed given two Business Days after delivery to such
      carrier.  All notices shall be addressed to the party to be notified
      at the address as follows, or at such other address as such party may designate
      by ten days’ advance written notice to the other party:

     

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

    
 

    If
      to the Company:

    

    Altair
      Nanotechnologies, Inc.

    204
      Edison Way

    Reno,
      Nevada 89502

    Attention:
      Alan Gotcher

    Fax:  (775)
      856-1619

    email:
      agotcher@altairnano.com

    

    With
      a copy to:

    

    Parr
      Waddoups Brown Gee & Loveless

    185
      South
      State Street, Suite 1300

    Salt
      Lake
      City, UT  84111

    Attn:  Bryan
      T. Allen

    Fax:
      (801) 532-7750

    Email:
      bta@pwlaw.com

    

    If
      to the Investor:

    

    Al
      Yousuf, LLC

    By
      courier:

    Mezzanine
      Floor, Yamaha Showroom

    Sheikh
      Zayed Road

    Dubai,
      United Arab Emirates

    

    By
      mail:

    P.O.
      Box
      25

    Dubai,
      United Arab Emirates

    Attn:
      Iqbal Al Yousuf

    Fax:
      +971.4.339.5544

    Email:
      eyousuf@alyousuf.com

    

    With
      a copy to:

    

    Akin
      Gump
      Strauss Hauer & Feld LLP

    P.O.
      Box
      120939

    Dubai,
      United Arab Emirates

    Attn:
      John Podgore

    Fax:
      +971.4.332.5024

    Email:
      jpodgore@akingump.com

    

     

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

    
 

    10.5     Expenses.  The
      parties hereto shall pay their own costs and expenses in connection
      herewith.  In the event that legal proceedings are commenced by any
      party to this Agreement against another party to this Agreement in connection
      with this Agreement or the other Transaction Documents, the party that does
      not
      prevail in such proceedings shall pay the reasonable attorneys’ fees and other
      reasonable out-of-pocket costs and expenses incurred by the prevailing party
      in
      such proceedings.

    

    10.6           Amendments
      and Waivers.  Any term of this Agreement may be amended and the
      observance of any term of this Agreement may be waived (either generally or
      in a
      particular instance and either retroactively or prospectively), only with the
      written consent of the Company and the Investor.  Any amendment or
      waiver effected in accordance with this paragraph shall be binding upon each
      holder of any Shares purchased under this Agreement at the time outstanding,
      each future holder of all such Shares, and the Company.

    

    10.7           Publicity.  No
      public release or announcement concerning the transactions contemplated hereby
      shall be issued (i) by the Investor without the prior consent of the Company
      (which consent shall not be unreasonably conditioned or withheld), or (ii)
      by
      the Company with the prior consent of the Investor identified therein (which
      consent shall not be unreasonably conditioned or withheld).  The
      foregoing shall not prohibit any party hereto from issuing any release or filing
      any report that is required by law or the applicable rules or regulations of
      any
      securities exchange or securities market.  The Investor understands
      that the Company is required to file a Current Report on Form 8-K describing
      the
      terms of the Transaction Documents and to include the Transaction Documents
      as
      Exhibits and hereby consents to such filing.

    

    10.9           Severability.  Any
      provision of this Agreement that is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions hereof but shall be interpreted as if it were written so as to be
      enforceable to the maximum extent permitted by applicable law, and any such
      prohibition or unenforceability in any jurisdiction shall not invalidate or
      render unenforceable such provision in any other jurisdiction.  To the
      extent permitted by applicable law, the parties hereby waive any provision
      of
      law which renders any provision hereof prohibited or unenforceable in any
      respect.

    

    10.10        
      Entire Agreement.  This Agreement, including the Exhibits and
      the Disclosure Letters, and the other Transaction Documents constitute the
      entire agreement among the parties hereof with respect to the subject matter
      hereof and thereof and supersede all prior agreements and understandings, both
      oral and written, between the parties with respect to the subject matter hereof
      and thereof.

    

    10.11        Further
      Assurances.  The parties shall execute and deliver all such
      further instruments and documents and take all such other actions as may
      reasonably be required to carry out the transactions contemplated hereby and
      to
      evidence the fulfillment of the agreements herein contained.

     

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

    
 

    10.12        
      Governing Law; Consent to Jurisdiction; Waiver of Jury
      Trial.  This Agreement shall be governed by, and construed in
      accordance with, the internal laws of the State of New York without regard
      to
      the choice of law principles thereof.  Each of the parties hereto
      irrevocably submits to the exclusive jurisdiction of the courts of the State
      of
      New York and United States District Court located in the New York City, New
      York
      for the purpose of any suit, action, proceeding or judgment relating to or
      arising out of this Agreement and the transactions contemplated
      hereby.  Service of process in connection with any such suit, action
      or proceeding may be served on each party hereto anywhere in the world by the
      same methods as are specified for the giving of notices under this
      Agreement.  Each of the parties hereto irrevocably consents to the
      jurisdiction of any such court in any such suit, action or proceeding and to
      the
      laying of venue in such court.  Each party hereto irrevocably waives
      any objection to the laying of venue of any such suit, action or proceeding
      brought in such courts and irrevocably waives any claim that any such suit,
      action or proceeding brought in any such court has been brought in an
      inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO
      REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND
      REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS
      WAIVER.

    

    10.13        
      Currency. All reference to dollars ($) or currency in this Agreement are
      to United States Dollars.

    

    [signature
      page follows]

     

     

     

     

    

    
      
        
          
          

        

        
          -29-

          
            

          

        

        
          
          

        

      

    

    

    

    IN
      WITNESS WHEREOF, the parties have
      executed this Purchase Agreement or caused their duly authorized officers to
      execute this Agreement as of the date first above written.

    

    
      	
              The
                Company:

            	
              ALTAIR
                NANOTECHNOLOGIES INC.

            
	 	 
	 	 
	 	 
	 	
              By:
                /s/ Alan
                Gotcher                                                      
                

            
	 	
              Name:
                Alan Gotcher

            
	 	
              Title:
                President and CEO

            
	 	 
	 	 
	 	 
	 	 
	
              Investor:

            	
              AL
                YOUSUF, LLC

            
	 	 
	 	 
	 	 
	 	
              By:
                /s/ Ipbal Al
                Yousuf                                          
                

            
	 	
              Name:
                Iqbal Al Yousuf

            
	 	
              Title:
                President

            

    

     

     

     

     

    

    

    

    

    
      
        
          
            Signature
              Page to Purchase Agreement

            Altair
              Nanotechnologies Inc. and Al Yousuf, LLC

          

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    Exhibit
      A

    to

    Purchase
      Agreement

    

    

    Registration
      Rights Agreement

    

    

    [see
      attached]

     

     

    
 

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    Exhibit
      B

    to

    Purchase
      Agreement

    

    

    Form
      of Company Legal Opinion

    

    Canadian
      Opinions

    

    
      	
              1.

            	
              The
                Corporation is a corporation existing under the laws of
                Canada.

            

    

     

    
      	
              2.

            	
              The
                Corporation has the corporate power and authority to enter into the
                Agreements, and to consummate the transactions contemplated thereby,
                including the issuance and delivery of the Shares to the
                Investor.

            

    

     

    
      	
              3.

            	
              The
                Corporation has taken all necessary corporate action to authorize
                the
                execution and delivery by it of the Agreements and the performance
                by the
                Corporation of its obligations under the Agreements, including the
                issuance and delivery of the Shares to the
                Investor.

            

    

     

    
      	
              4.

            	
              To
                the extent that such matters are governed by the laws of the Province
                of
                Ontario and the laws of Canada applicable therein, the Agreements
                has been
                duly executed and delivered by the
                Corporation.

            

    

     

    
      	
              5.

            	
              The
                Shares have been validly created and allotted and, when issued to
                the
                Investor in accordance with the terms of the Agreements, will be
                validly
                issued and outstanding as fully paid and non-assessable common shares
                of
                the Corporation.

            

    

     

    
      	
              6.

            	
              No
                consent, approval, order or authorization of, or registration,
                qualification, designation, declaration or filing with, any governmental
                authority is required in connection with the execution and delivery
                by the
                Corporation of the Agreements or the performance by the Corporation
                of its
                obligations under the Agreements on the
                Closing.

            

    

     

    

    U.S.
      Opinions

    

    1.           No
      consent, approval, order or authorization of, or registration, qualification,
      designation, declaration or filing with, any federal, state or local
      governmental authority on the part of the Corporation is required in connection
      with the consummation of the purchase and sale of the Shares under the Purchase
      Agreement, other than as set forth in Section 4.5of the Purchase
      Agreement.

    

    2.           The
      Agreements constitutes the valid and binding agreement of the Corporation,
      enforceable against the Corporation in accordance with its
      terms.   [Relies on Canadian foundational opinions; Nevada and
      U.S. law]altair_8k-ex1002.htm

    
      

    

     

     

    Exhibit
      10.2

    
 

    REGISTRATION
      RIGHTS AGREEMENT

    

    This
      Registration Rights Agreement (the “Agreement”) is made and entered into
      as of this 29th
      day of November, 2007 by and between Altair Nanotechnologies, Inc., a Canadian
      corporation (the “Company”), and Al Yousuf, LLC, a United Arab Emirates
      limited liability company (the “Investor”).

     

    The
      parties hereby agree as follows:

     

    1.           Certain
      Definitions.

     

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

     

    “Additional
      Selling Shareholders” means Persons offering securities under a Registration
      other than the Investor or the Company.”

     

    “Affiliate”
      means, with respect to any Person, any other Person which directly or indirectly
      Controls, is Controlled by, or is under common Control with, such
      Person.

     

    “Business
      Day” means a day, other than a Friday, Saturday or Sunday, on which banks in
      New York and the United Arab Emirates are open for the general transaction
      of
      business.

     

    “Change
      of Control” means (a) a consolidation of the Company with, or merger of the
      Company into, another Person, (b) a sale or conveyance of all or substantially
      all of the assets of the Company to another Person, or (c) a sale or conveyance
      in a single transaction, or related transactions, of securities representing
      a
      majority of the votes in the election of directors of the Company; provided,
      however, with respect to each of (a), (b) and (c), the acquiring Person is
      not
      controlled by the Company or a Person in which, prior to or as a result of
      the
      transaction, the shareholders of the Company hold a majority of the votes in
      the
      election of directors.

     

    “Closing”
      means the Initial Closing under the Purchase Agreement.

     

    “Common
      Stock” means the Company’s common shares, without par value, and any
      securities into which such shares may hereinafter be reclassified.

     

    “Control”
      (including the terms “controlling”, “controlled by” or “under common control
      with”) means the possession, direct or indirect, of the power to direct or cause
      the direction of the management and policies of a Person, whether through the
      ownership of voting securities, by contract or otherwise.

     

    “Investor”
      means the Investor and any Affiliate or permitted transferee of the Investor
      who
      becomes a party to this Agreement and subsequently holds any Registrable
      Securities or  Restricted Securities.

     

    “Person”
      means an individual, corporation, partnership, limited liability company, trust,
      business trust, association, joint stock company, joint venture, sole
      proprietorship, unincorporated organization, governmental authority or any
      other
      form of entity not specifically listed herein.

     

    “Prospectus”
      means the prospectus included in any Registration Statement, as amended or
      supplemented by any prospectus supplement, with respect to the terms of the
      offering of any portion of the Registrable Securities or Restricted Securities
      covered by such Registration Statement and by all other amendments and
      supplements to the prospectus, including post-effective amendments and all
      material incorporated by reference in such prospectus.

     

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    “Purchase
      Agreement” means that certain Purchase Agreement by and between the Company
      and Investor dated the date hereof.

     

    “Register,”
      “registered,” “registration,” and “Registration” refer to a
      registration made by preparing and filing a Registration Statement or similar
      document in compliance with the 1933 Act, and the declaration or ordering of
      effectiveness of such Registration Statement or document.  Unless
      otherwise specified or evident from the context, the term “Registration” refers
      to a Demand Registration or a Mandatory Registration.

     

    “Registrable
      Securities” means (a) the Shares or other securities issued or issuable to
      Investor or its transferee or designee (i) upon any distribution with respect
      to, any exchange for or any replacement of such Shares or (ii) upon any
      conversion, exercise or exchange of any securities issued in connection with
      any
      such distribution, exchange or replacement; (b) securities issued or issuable
      upon any stock split, stock dividend, recapitalization or similar event with
      respect to the foregoing; and (c) any other security issued as a dividend or
      other distribution with respect to, in exchange for, in replacement or
      redemption of, any of the securities referred to in the preceding clauses;
      provided, that, a security shall cease to be a Registrable Security (A) upon
      sale by the Investor to any Person other than a Person who is a permitted
      assignee under Section 7(c) and assumes the right and obligations of Investor
      under this Agreement with respect to such transferred securities, or (B) the
      expiration of the Effectiveness Period (as defined in Section 3(a)) with respect
      to a Registration Statement in a Demand Registration that is declared
      effective.

     

    “Restricted
      Securities” means (a) the Shares or other securities issued or issuable to
      Investor or its transferee or designee (i) upon any distribution with respect
      to, any exchange for or any replacement of such Shares or (ii) upon any
      conversion, exercise or exchange of any securities issued in connection with
      any
      such distribution, exchange or replacement; (b) securities issued or issuable
      upon any stock split, stock dividend, recapitalization or similar event with
      respect to the foregoing; and (c) any other security issued as a dividend or
      other distribution with respect to, in exchange for, in replacement or
      redemption of, any of the securities referred to in the preceding clauses;
      provided, that, a security shall cease to be a Restricted Security (A) upon
      sale
      by the Investor to any Person other than a Person who is a permitted assignee
      under Section 7(c) and assumes the right and obligations of Investor under
      this
      Agreement with respect to such transferred securities, or (B) upon eligibility
      for resale pursuant to Rule 144(k) (or any successor provision) or otherwise
      under Rule 144 without either volume restrictions or manner of sale
      restrictions.

     

     “Registration
      Statement” means any registration statement of the Company filed under the
      1933 Act that covers the resale of any of the Registrable Securities or
      Restricted Securities pursuant to the provisions of this Agreement, amendments
      and supplements to such Registration Statement, including post-effective
      amendments, and all exhibits and all material incorporated by reference in
      such
      Registration Statement.

     

    “SEC”
      means the U.S. Securities and Exchange Commission.

     

    “Shares”
      means the shares of Common Stock issued to Investor pursuant to the Purchase
      Agreement.

     

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    “1933
      Act” means the Securities Act of 1933, as amended, and the rules and
      regulations promulgated thereunder.

    

    “1934
      Act” means the Securities Exchange Act of 1934, as amended, and the rules
      and regulations promulgated thereunder.

    

    2.           Demand
      Registration.

    

    (a)           Demand
      Registration. Subjection to Section 2(h) below, at any time after the second
      anniversary of the Closing and until the eighth anniversary of the Closing,
      the
      Investor may request a single registration under the 1933 Act of the resale
      of
      all or any portion of its Registrable Securities (such registration, the
“Demand Registration”).  The Demand Registration shall be on
      the registration form selected by the Company among the forms appropriate for
      the proposed plan of distribution for which the Company is
      eligible.  The request for Demand Registration shall specify the
      number of Registrable Securities requested to be registered and the intended
      method of distribution, including an election as to (i) whether the Investor
      intends to offer and sell the Registrable Securities on a continuous basis
      pursuant to Rule 415 under the Securities Act, or (ii) whether the Investor
      intends to request engagement of an underwriter with respect to the Demand
      Registration and the identity of any underwriters the Investor is recommending
      (with it being understood that (i) and (ii) are mutually exclusive
      alternatives).   

    

    (b)           Mandatory
      Registration.

     

    (i)           The
      Company shall prepare and file with the SEC, and have declared effective on
      or
      before the two-year anniversary of the Closing, a single Registration Statement
      on Form S-3 (or, if Form S-3 is not then available to the Company, on such
      form
      of registration statement as is then available to effect a registration for
      resale of the Restricted Securities) for a secondary or resale offering on
      a
      continuous basis pursuant to Rule 415 under the 1933 Act of the Restricted
      Securities (such registration, the “Mandatory Registration”). Such
      Registration Statement also shall cover, to the extent allowable under the
      1933
      Act and the rules promulgated thereunder (including Rule 416), such
      indeterminate number of additional shares of Common Stock resulting from stock
      splits, stock dividends or similar transactions with respect to the Restricted
      Securities.

     

    (ii)           For
      not more than twenty (20) consecutive days or for a total of not more than
      forty-five (45) days in any twelve (12) month period, the Company may delay
      the
      disclosure of material non-public information concerning the Company, by
      suspending the use of any Prospectus included in any Mandatory Registration
      containing such information, the disclosure of which at the time is not, in
      the
      good faith opinion of the Chief Executive Officer and Chief Financial Officer
      of
      the Company, upon advice of counsel, in the best interests of the Company (an
      “Allowed Delay”); provided, that the Company shall promptly (a) notify
      Investor in writing of the existence of (but in no event, without the prior
      written consent of Investor, shall the Company disclose to Investor any of
      the
      facts or circumstances regarding) material non-public information giving rise
      to
      an Allowed Delay, (b) advise Investor in writing to cease all sales under the
      Registration Statement until the end of the Allowed Delay and (c) use its best
      efforts to terminate an Allowed Delay as promptly as practicable.

     

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    (c)           Underwriting.
      If a request for Demand Registration indicates the Investor’s intent to engage
      an underwriter with respect to the Demand Registration, the Investor shall
      promptly engage a managing underwriter to administer the offering of any
      Registrable Securities registered in the Demand Registration, which managing
      underwriter shall be an internationally or United States nationally recognized
      investment bank approved by the Company in writing, such approval not to be
      unreasonably withheld.

     

    (d)           Inclusion
      of Additional Securities.  Subject to Section 2(e), the Company
      may include in any Demand Registration or Mandatory Registration common shares
      to be offered and sold by the Company or Additional Selling Shareholders.

    

    (e)           Priority
      on Underwritten Demand Registrations. .In connection with any Demand
      Registration involving an underwriting, if the total number of securities,
      including Registrable Securities, requested by the Investor, the Company and
      Additional Selling Shareholders to be included in such offering exceeds the
      amount of securities that the underwriters determine in their reasonable
      discretion is compatible with the success of the offering, then the Company
      shall be required to include in the offering only that number of such
      securities, including Registrable Securities, which the underwriters determine
      in their reasonable discretion will not jeopardize the success of the
      offering.  In the event that the underwriters determine that less than
      all of the securities requested to be registered can be included in such
      offering, then (i) no securities other than Registrable Securities shall be
      included in the Demand Registration unless all Registration Securities
      designated by the Investor for inclusion in the Demand Registration are
      included, and (ii) if all Registrable Securities designated by the Investor
      for
      inclusion are included and the underwriters determine that the inclusion of
      additional securities would not jeopardize the success of the offering, the
      Company may allocate in its discretion the additional securities to be included
      in the Demand Registration among itself and any Additional Selling
      Shareholders.

    

    (f)           Delay
      of Demand Registration. The Company may postpone for up to 120 days the
      filing or the effectiveness of a Registration Statement for a Demand
      Registration if the Company’s board of directors determines in its reasonable
      good faith judgment that such Demand Registration would reasonably be expected
      to have a material adverse effect on any proposal or plan by the Company or
      any
      of its subsidiaries to engage in any acquisition of assets (other than in the
      Ordinary Course of Business), financing, joint venture, merger, consolidation,
      tender offer, reorganization or other material strategic transaction; provided
      that in such event, the Investor shall be entitled to withdraw such request
      and,
      if such request is withdrawn, such Demand Registration shall not count as the
      single permitted Demand Registration hereunder and the Company shall pay all
      expenses in connection with such registration.  The Company may delay
      a Demand Registration hereunder only once in any twelve-month
      period.

    

    (g)           Registration
      Expenses. The Company will pay the following expenses associated with the
      Demand Registration of Registrable Securities and a Mandatory Registration
      of
      Restricted Securities: filing, registration and printing fees, fees and expenses
      of the Company’s counsel and auditors, fees and expenses associated with
      clearing the Registrable Securities for sale under applicable state securities
      or “blue sky” laws, listing fees, transfer taxes, fees of transfer agents and
      registrars and other direct expenses of the Company.  The Investor and
      each Additional Selling Shareholders shall pay fees and expenses of any legal
      counsel, auditor or other advisor engaged by such Person.  Subject to
      the Company’s obligation to pay all expenses in connection with a registration
      delayed pursuant to Section 2(f), all other fees and expenses associated with
      any Demand Registration or Mandatory Registration, including, without
      limitation, discounts, commissions and fees of underwriters, expenses and fees
      of underwriters and their counsel, and fees and expenses of selling brokers,
      dealer managers or similar securities industry professionals, shall be paid
      by
      the Investor and other participants in the Registration (including the Company
      if it participates), with such expenses being allocated pro rata among the
      participants based upon the number of securities registered for sale in the
      Registration.

     

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    (h)           Change
      of Control. The rights of the Investor under this Section 2, and the
      obligations of the Company under Section 2 and Section 3, shall immediately
      and
      automatically terminate upon the closing of Change of Control in which the
      shares of Common Stock of the Company are exchanged for the right to receive
      (i)
      cash and/or (ii) securities that are registered on a United States national
      stock exchange, issued by a Person with a market capitalization in excess of
      $1
      Billion and not subject to restrictions on trading (other than under Rule 145
      under the Securities Act).

     

    3.           Company
      Obligations.  The Company will use its commercially best efforts
      to effect the registration of the Registrable Securities in a Registration
      in
      accordance with the terms hereof, and pursuant thereto the Company will, as
      expeditiously as possible:

     

    (a)           prepare
      and file with the SEC such amendments and post-effective amendments to the
      Registration Statement and the Prospectus as may be necessary to keep the
      Registration Statement effective for the period specified in Section 3 and to comply with the provisions
      of the
      1933 Act and the 1934 Act with respect to the distribution of all of the
      Registrable Securities or Restricted Securities covered thereby;

     

    (b)           use
      its commercially best efforts to cause such Registration Statement to become
      effective and to remain continuously effective for a period (the
“Effectiveness Period”) that will terminate upon the earliest of
      :

     

    (i)
      for a Demand Registration, (A) the
      date on which all Registrable Securities covered by such Registration Statement,
      as amended from time to time, have been sold or cease to be Registrable
      Securities, (B) if the Investor requests engagement of, and the Company engages,
      an underwriter, the earlier of the date that is 90 days after the effectiveness
      of the Registration Statement and the date the managing underwriter terminates
      or closes the offering, and (C) the eighth anniversary of the Closing;
      and.

     

    (ii)
      for a Mandatory Registration, the
      date on which all Restricted Securities covered by such Registration Statement,
      as amended from time to time, have been sold or cease to be Restricted
      Securities.

     

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    (c)           provide
      copies to and permit a single counsel designated by Investor to review the
      Registration Statement and all amendments and supplements thereto no fewer
      than
      four (4) Business Days prior to their filing with the SEC and not file any
      document to which any such counsel reasonably objects; provided, however, in
      the
      event that the Company receives a notice that the Registration Statement or
      amendment to the Registration Statement will not be reviewed by the SEC or
      that
      the SEC will accept a request for effectiveness of the Registration Statement,
      the Company may make immaterial updates to the prior version of the Registration
      Statement or amendment and file such updated Registration Statement or amendment
      without providing such counsel an opportunity to review the Registration
      Statement or amendment.

     

    (d)           furnish
      to Investor and its legal counsel (which may be by email or portable document
      format (pdf) file) (i) promptly after the same is prepared and publicly
      distributed, filed with the SEC, or received by the Company (but not later
      than
      two (2) Business Days after the filing date, receipt date or sending date,
      as
      the case may be) one (1) copy of the Registration Statement and any amendment
      thereto, each preliminary prospectus and Prospectus and each amendment or
      supplement thereto, and (ii) such number of copies of a Prospectus, including
      a
      preliminary prospectus, and all amendments and supplements thereto and such
      other documents as Investor may reasonably request in order to facilitate the
      disposition of the Registrable Securities or Restricted Securities owned by
      Investor that are covered by the Registration Statement;

     

    (e)           if
      an underwriter is engaged for the offering, the Company shall enter into and
      perform its reasonable obligations under an underwriting agreement, in usual
      and
      customary form, including, without limitation, customary indemnification and
      contribution obligations, with the underwriter of such offering;

     

    (f)           if
      required by any underwriter engaged for the offering, the Company shall furnish,
      on the effective date of the Registration Statement (except with respect to
      clause (i) below) and on the date that Registrable Securities or Restricted
      Securities are delivered to an underwriter, if any, for sale in connection
      with
      the Registration Statement, (i)(A) in the case of an underwritten offering,
      an
      opinion, dated as of the closing date of the sale of Registrable Securities
      or
      Restricted Securities to the underwriters, from independent legal counsel
      representing the Company for purposes of such Registration Statement, in form,
      scope and substance as is customarily given in an underwritten public offering,
      addressed to the underwriters participating in such underwritten offering and
      Investor or (B) in the case of an “at the market” offering, an opinion, dated as
      of or promptly after the effective date of the Registration Statement to
      Investor, from independent legal counsel representing the Company for purposes
      of such Registration Statement, in form, scope and substance as is customarily
      given in a public offering, addressed to Investor, and (ii) a letter, dated
      as
      of the effective date of such Registration Statement and confirmed as of the
      applicable dates described above, from the Company’s independent certified
      public accountants in form and substance as is customarily given by independent
      certified public accountants to underwriters in an underwritten public offering,
      addressed to the underwriters (including any Investor deemed to be an
      underwriter);

     

    (g)           use
      its best efforts to (i) prevent the issuance of any stop order or other
      suspension of effectiveness and, (ii) if such order is issued, obtain the
      withdrawal of any such order at the earliest possible moment;

     

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

    (h)           use
      its best efforts to register or qualify or cooperate with Investor and its
      counsel in connection with the registration or qualification of such Registrable
      Securities or Restricted Securities for offer and sale under the securities
      or
      blue sky laws of such jurisdictions reasonably requested by Investor and do
      any
      and all other acts or things necessary or advisable to enable the distribution
      in such jurisdictions of the Registrable Securities or Restricted Securities
      covered by the Registration Statement; provided, however, that the Company
      shall
      not be required in connection therewith or as a condition thereto to (i) qualify
      to do business in any jurisdiction where it would not otherwise be required
      to
      qualify but for this Section 3(h), (ii) subject itself to general taxation
      in
      any jurisdiction where it would not otherwise be so subject but for this Section
      3(h), or (iii) file a general consent to service of process in any jurisdiction
      where it would not otherwise be required to qualify but for this Section
      3(h);

     

    (i)           if
      applicable, list all Registrable Securities or Restricted Securities covered
      by
      a Registration Statement to be listed on each securities exchange, interdealer
      quotation system or other market on which similar securities issued by the
      Company are then listed;

     

    (j)           immediately
      notify Investor, at any time when a Prospectus relating to Registrable
      Securities or Restricted Securities is required to be delivered under the 1933
      Act, upon discovery that, or upon the happening of any event as a result of
      which, the Prospectus included in a Registration Statement, as then in effect,
      includes an untrue statement of a material fact or omits to state any material
      fact required to be stated therein or necessary to make the statements therein
      not misleading in light of the circumstances then existing, and at the request
      of any such holder, promptly prepare and furnish to such holder a reasonable
      number of copies of a supplement to or an amendment of such Prospectus as may
      be
      necessary so that, as thereafter delivered to the purchasers of such Registrable
      Securities or Restricted Securities, such Prospectus shall not include 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 not misleading in
      light of the circumstances then existing;

     

    (k)           otherwise
      use its best efforts to comply with all applicable rules and regulations of
      the
      SEC under the 1933 Act and the 1934 Act, and take such other actions as may
      be
      reasonably necessary to facilitate the registration of the Registrable
      Securities or Restricted Securities hereunder; and

     

    (l)           with
      a view to making available to Investor the benefits of Rule 144 (or its
      successor rule) and any other rule or regulation of the SEC that may at any
      time
      permit Investor to sell Registrable Securities or Restricted Securities to
      the
      public without registration, the Company covenants and agrees to, during the
      Effectiveness Period:  (i) make and keep public information available,
      as those terms are understood and defined in Rule 144; (ii) file with the SEC
      in
      a timely manner all reports and other documents required of the Company under
      the 1934 Act; and (iii) furnish to Investor upon request, as long as Investor
      owns any Registrable Securities or Restricted Securities, (A) a written
      statement by the Company that it has complied with the reporting requirements
      of
      the 1934 Act, (B) a copy of the Company’s most recent Annual Report on Form 10-K
      or Quarterly Report on Form 10-Q, and (C) such other information as may be
      reasonably requested in order to avail Investor of any rule or regulation of
      the
      SEC that permits the selling of any such Registrable Securities or Restricted
      Securities without registration.

     

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    4.           Due
      Diligence Review; Information.  During a period beginning thirty
      days prior to the filing of the Registration Statement and continuing until
      the
      effectiveness of such Registration Statement, the Company shall make available,
      during normal business hours, for inspection and review by Investor, advisors
      to
      and representatives of Investor (who may or may not be affiliated with Investor,
      and who are reasonably acceptable to the Company), and any underwriter
      participating in any disposition of shares of Common Stock on behalf of Investor
      pursuant to a Registration Statement or amendments or supplements thereto or
      any
      blue sky, FINRA or other filing, all financial and other records, all SEC
      Filings (as defined in the Purchase Agreement) and other filings with the SEC,
      and all other corporate documents and properties of the Company as may be
      reasonably necessary for the purpose of such review, and cause the Company’s
      officers, directors and employees, within a reasonable time period, to supply
      all such information reasonably requested by Investor or any such
      representative, advisor or underwriter in connection with such Registration
      Statement (including, without limitation, in response to all questions and
      other
      inquiries reasonably made or submitted by any of them), for the sole purpose
      of
      enabling Investor and such representatives, advisors and underwriters and their
      respective accountants and attorneys to conduct initial and ongoing due
      diligence with respect to the Company and the accuracy of such Registration
      Statement.  The Company shall not disclose material nonpublic
      information to Investor, or to advisors to or representatives of Investor,
      unless prior to disclosure of such information the Company identifies such
      information as being material nonpublic information and provides Investor,
      such
      advisors and representatives with the opportunity to accept or refuse to accept
      such material nonpublic information for review and any Investor wishing to
      obtain such information enters into an appropriate confidentiality agreement
      with the Company with respect thereto.  Notwithstanding the breadth of
      the foregoing, the Company shall be permitted to limit or deny any Investor,
      and
      that Investor’s representatives, advisors and underwriters and their respective
      accountants and attorneys, copies of or access to any document or information
      if
      the Company determines that, because of such Investor’s affiliation with a
      competitor, customer, supplier or for any other reason, disclosure of such
      information to any such person may harm the ability of the Company to keep
      confidential information from its customers, competitors and supplier or would
      otherwise harm the competitive position of the Company.

     

    5.           Obligations
      of Investor.

     

    (a)           Investor
      shall furnish in writing to the Company such information regarding itself,
      the
      Registrable Securities or Restricted Securities held by it and the intended
      method of disposition of the Registrable Securities or Restricted Securities
      held by it, as shall be reasonably required to effect the registration of such
      Registrable Securities or Restricted Securities (or to complete any amendment
      to
      any Registration Statement) and shall execute such documents in connection
      with
      such registration as the Company may reasonably request.  At least
      fifteen (15) Business Days prior to the first anticipated filing date of any
      Registration Statement, the Company shall notify Investor of the information
      the
      Company requires from Investor if Investor elects to have any of the Registrable
      Securities or Restricted Securities included in the Registration
      Statement.  Investor shall provide such information to the Company at
      least four (4) Business Days prior to the first anticipated filing date of
      such
      Registration Statement if Investor elects to have any of the Registrable
      Securities or Restricted Securities included in the Registration
      Statement.  At least ten (10) Business Days prior to the anticipated
      filing date of any pre-effective or post-effective amendment to any Registration
      Statement (provided that, if any amendment is filed in response to comment
      receive by the SEC, notice within two (2) Business Days the Company’s receipt of
      the SEC comment shall be sufficient), the Company shall notify Investor of
      the
      information the Company reasonably requires from Investor if Investor elects
      to
      have any of the Registrable Securities or Restricted Securities included in
      the
      Registration Statement.  Investor shall provide such information to
      the Company prior to the later of (i) at least four (4) Business Days prior
      to
      the first anticipated filing date of such Registration Statement, or (ii) two
      (2) Business Days after a timely request therefor from the Company, in each
      case
      if Investor elects to have any of the Registrable Securities or Restricted
      Securities included in the Registration Statement.  If Investor fails
      to provide information to the Company as required by this subsection, at all
      or
      on a timely basis, and the Company reasonably expects the Registration Statement
      or amendment in question to be an effective version of the Registration
      Statement, the Company may exclude Investor’s Registrable Securities or
      Restricted Securities from the Registration Statement or amendment in question
      without penalty

     

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    (b)                      Investor,
      by its acceptance of the Shares agrees to cooperate with the Company as
      reasonably requested by the Company in connection with the preparation and
      filing of a Registration Statement hereunder, unless Investor has notified
      the
      Company in writing of its election to exclude all of its Registrable Securities
      or Restricted Securities from the Registration Statement.

     

    (c)                      If
      an underwriter is engaged at the request of Investor with respect to a
      Registration, Investor agrees to enter into and perform its obligations under
      an
      underwriting agreement, in usual and customary form, including, without
      limitation, customary indemnification and contribution obligations, with the
      managing underwriter of such offering and take such other actions as are
      reasonably required in order to expedite or facilitate the dispositions of
      the
      Registrable Securities or Restricted Securities.

     

    (d)           Investor
      agrees that, upon receipt of any notice from the Company of the happening of
      an
      event pursuant to Section 3(j) hereof, Investor will immediately discontinue
      disposition of Registrable Securities or Restricted Securities pursuant to
      the
      Registration Statement covering such Registrable Securities or Restricted
      Securities, until Investor’s receipt of the copies of the supplemented or
      amended prospectus filed with the SEC and until any related post-effective
      amendment is declared effective and, if so directed by the Company, Investor
      shall deliver to the Company (at the expense of the Company) or destroy (and
      deliver to the Company a certificate of destruction) all copies in Investor’s
      possession of the Prospectus covering the Registrable Securities or Restricted
      Securities current at the time of receipt of such notice.

     

    (e)           If
      an underwriter is engaged at the request of Investor with respect to a
      Registration , Investor agrees to (i) sell the Registrable Securities or
      Restricted Securities on the basis provided in any underwriting arrangements
      in
      usual and customary form requested by the managing underwriter, (ii) complete
      and execute all questionnaires, powers of attorney, indemnities, underwriting
      agreements and other documents reasonably required under the terms of such
      underwriting arrangements, and (iii) pay its pro rata share of all underwriting
      discounts and commissions, in addition to other expenses allocated to the
      Investor (and other selling shareholders, if any) under Section
      2(g).  Notwithstanding the foregoing, Investor shall not be required
      to make any representations to such underwriter, other than those with respect
      to itself and the Registrable Securities or Restricted Securities owned by
      it,
      including its right to sell the Registrable Securities or Restricted Securities,
      and any indemnification in favor of the underwriter by Investor shall be several
      and not joint and limited in the case of Investor, to the net proceeds received
      by Investor from the sale of its Registrable Securities or Restricted
      Securities.  The scope of any such indemnification in favor of an
      underwriter shall be limited to the same extent as the indemnity provided in
      Section 6(b) hereof.

     

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    6.           Indemnification.

     

    (a)           Indemnification
      by the Company.  The Company will indemnify and hold harmless
      Investor and its officers, directors, members, employees and agents, successors
      and assigns, and each other person, if any, who controls Investor within the
      meaning of the 1933 Act, against any losses, claims, damages or liabilities,
      joint or several, to which they may become subject under the 1933 Act or
      otherwise, insofar as such losses, claims, damages or liabilities (or actions
      in
      respect thereof) arise out of or are based upon:  (i) any untrue
      statement or alleged untrue statement of any material fact contained in any
      Registration Statement, any preliminary prospectus or final prospectus contained
      therein, or any amendment or supplement thereof; (ii) any blue sky application
      or other document executed by the Company specifically for that purpose or
      based
      upon written information furnished by the Company filed in any state or other
      jurisdiction in order to qualify any or all of the Registrable Securities or
      Restricted Securities under the securities laws thereof (any such application,
      document or information herein called a “Blue Sky
      Application”); (iii) the omission or alleged omission to
      state therein a material fact required to be stated therein or necessary to
      make
      the statements therein, in light of the circumstances under which they are
      made,
      not misleading; or (iv) any violation by the Company or its agents of any rule
      or regulation promulgated under the 1933 Act applicable to the Company or its
      agents and relating to action or inaction required of the Company in connection
      with such registration, and will reimburse Investor, and each such officer,
      director, member, employee or agent and each such controlling person for any
      legal or other expenses reasonably incurred by them in connection with
      investigating or defending any such loss, claim, damage, liability or action;
      provided, however, that the Company will not be liable in any such
      case if and to the extent that any such loss, claim, damage or liability arises
      out of or is based upon an untrue statement or alleged untrue statement or
      omission or alleged omission so made in conformity with information reasonably
      relied on by the Company and furnished by Investor or any such controlling
      person in writing specifically for use in such Registration Statement or
      Prospectus.  The Company shall notify Investor promptly of the
      institution of any proceeding of which the Company is aware in connection with
      the transactions contemplated by this Agreement.  Such indemnity shall
      survive the transfer of the Registrable Securities or Restricted Securities
      by
      Investor, but the right to receive indemnification under this Agreement shall
      not be transferable without the express written consent of the
      Company.

     

    (b)           Indemnification
      by Investor.  In connection with any registration pursuant to the
      terms of this Agreement, Investor will furnish to the Company in writing such
      information as the Company reasonably requests concerning the holders of
      Registrable Securities or Restricted Securities or the proposed manner of
      distribution for use in connection with any Registration Statement or Prospectus
      and agrees to indemnify and hold harmless, to the fullest extent permitted
      by
      law, the Company, its directors, officers, employees, stockholders and each
      person who controls the Company (within the meaning of the 1933 Act) against
      any
      losses, claims, damages, liabilities and expense (including reasonable attorney
      fees) resulting from any untrue statement of a material fact or any omission
      of
      a material fact required to be stated in the Registration Statement or
      Prospectus or preliminary prospectus or amendment or supplement thereto or
      necessary to make the statements therein not misleading, to the extent, but
      only
      to the extent that such untrue statement or omission is contained in any
      information reasonably relied on by the Company and furnished in writing by
      Investor to the Company specifically for inclusion in such Registration
      Statement or Prospectus or amendment or supplement thereto.  In no
      event shall the liability of Investor be greater in amount than the dollar
      amount of the proceeds (net of all expense paid by Investor in connection with
      any claim relating to this Section 6 and the amount of any damages Investor
      has
      otherwise been required to pay by reason of such untrue statement or omission)
      received by Investor upon the sale of the Registrable Securities or Restricted
      Securities included in the Registration Statement giving rise to such
      indemnification obligation.

     

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    (c)           Conduct
      of Indemnification Proceedings.  Any person entitled to
      indemnification hereunder shall (i) give prompt notice to the indemnifying
      party
      of any claim with respect to which it seeks indemnification and (ii) permit
      such
      indemnifying party to assume the defense of such claim with counsel reasonably
      satisfactory to the indemnified party; provided that any person entitled
      to indemnification hereunder shall have the right to employ separate counsel
      and
      to participate in the defense of such claim, but the fees and expenses of such
      counsel shall be at the expense of such person unless (a) the indemnifying
      party
      has agreed to pay such fees or expenses, or (b) the indemnifying party shall
      have failed to assume the defense of such claim and employ counsel reasonably
      satisfactory to such person or (c) in the reasonable judgment of any such
      person, based upon written advice of its counsel, a conflict of interest exists
      between such person and the indemnifying party with respect to such claims
      (in
      which case, if the person notifies the indemnifying party in writing that such
      person elects to employ separate counsel at the expense of the indemnifying
      party, the indemnifying party shall not have the right to assume the defense
      of
      such claim on behalf of such person); and provided, further, that
      the failure of any indemnified party to give notice promptly as provided herein
      shall not relieve the indemnifying party of its obligations hereunder, except
      to
      the extent that such failure to give notice promptly shall materially adversely
      affect the indemnifying party in the defense of any such claim or
      litigation.  It is understood that the indemnifying party shall not,
      in connection with any proceeding in the same jurisdiction, be liable for fees
      or expenses of more than one separate firm of attorneys at any time for all
      such
      indemnified parties.  No indemnifying party will, except with the
      consent of the indemnified party, not to be unreasonably withheld, consent
      to
      entry of any judgment or enter into any settlement that (y) does not include
      as
      an unconditional term thereof the giving by the claimant or plaintiff to such
      indemnified party of a release from all liability in respect of such claim
      or
      litigation, or (z) imposes any monetary or other obligation or restriction
      on
      the indemnified party.

     

    (d)           Contribution.  If
      for any reason the indemnification provided for in the preceding paragraphs
      (a)
      and (b) is unavailable to an indemnified party or insufficient to hold it
      harmless, other than as expressly specified therein, then the indemnifying
      party
      shall contribute to the amount paid or payable by the indemnified party as
      a
      result of such loss, claim, damage or liability in such proportion as is
      appropriate to reflect the relative fault of the indemnified party and the
      indemnifying party, as well as any other relevant equitable
      considerations.  No person guilty of fraudulent misrepresentation
      within the meaning of Section 11(f) of the 1933 Act shall be entitled to
      contribution from any person not guilty of such fraudulent
      misrepresentation.  In no event shall the contribution obligation of a
      holder of Registrable Securities or Restricted Securities be greater in amount
      than the dollar amount of the proceeds (net of all expenses paid by such holder
      in connection with any claim relating to this Section 6 and the amount of any
      damages such holder has otherwise been required to pay by reason of such untrue
      or alleged untrue statement or omission or alleged omission) received by it
      upon
      the sale of the Registrable Securities or Restricted Securities giving rise
      to
      such contribution obligation.  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.

     

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    7.           Miscellaneous.

     

    (a)           Amendments
      and Waivers.  This Agreement may be amended only by a writing
      signed by the Company and Investor.  The Company may take any action
      herein prohibited, or omit to perform any act herein required to be performed
      by
      it, only if the Company shall have obtained the written consent to such
      amendment, action or omission to act, of Investor.

     

    (b)           Notices.  All
      notices and other communications provided for or permitted hereunder shall
      be
      made as set forth in Section 10.4 of the Purchase Agreement.

     

    (c)           Assignments
      and Transfers by Investor.  The provisions of this Agreement shall
      be binding upon and inure to the benefit of Investor and its respective
      successors and assigns.  Investor may transfer or assign, in whole or
      from time to time in part, to one or more persons its rights hereunder in
      connection with the transfer of a minimum of 1,000,000  Registrable
      Securities by Investor to such person, provided that Investor complies with
      all
      laws applicable thereto, provides written notice of assignment to the Company
      promptly after such assignment is effected and the assignee executes a
      counterpart to this Agreement assuming all rights and obligations of Investor
      hereunder and pays all costs and expenses associated with any such
      transfer.

     

    (d)           Assignments
      and Transfers by the Company.  This Agreement may not be assigned
      by the Company without the prior written consent of Investor, provided, however,
      that the Company may assign its rights and delegate its duties hereunder to
      any
      surviving or successor corporation in connection with a merger or consolidation
      of the Company with another corporation, or a sale, transfer or other
      disposition of all or substantially all of the Company’s assets to another
      corporation, without the prior written consent of Investor.

     

    (e)           Benefits
      of the Agreement.  The terms and conditions of this Agreement
      shall inure to the benefit of and be binding upon the respective permitted
      successors and assigns of the parties.  Nothing in this Agreement,
      express or implied, is intended to confer upon any party other than the parties
      hereto or their respective successors and assigns any rights, remedies,
      obligations, or liabilities under or by reason of this Agreement, except as
      expressly provided in this Agreement.

     

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    (f)           Counterparts;
      Faxes.  This Agreement may be executed in two or more
      counterparts, each of which shall be deemed an original, but all of which
      together shall constitute one and the same instrument.  This Agreement
      may also be executed via facsimile, which shall be deemed an
      original.

     

    (g)           Titles
      and Subtitles.  The titles and subtitles used in this Agreement
      are used for convenience only and are not to be considered in construing or
      interpreting this Agreement.

     

    (h)           Severability.  Any
      provision of this Agreement that is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions hereof but shall be interpreted as if it were written so as to be
      enforceable to the maximum extent permitted by applicable law, and any such
      prohibition or unenforceability in any jurisdiction shall not invalidate or
      render unenforceable such provision in any other jurisdiction.  To the
      extent permitted by applicable law, the parties hereby waive any provision
      of
      law which renders any provisions hereof prohibited or unenforceable in any
      respect.

     

    (i)           Further
      Assurances.  The parties shall execute and deliver all such
      further instruments and documents and take all such other actions as may
      reasonably be required to carry out the transactions contemplated hereby and
      to
      evidence the fulfillment of the agreements herein contained.

     

    (j)           Entire
      Agreement.  This Agreement is intended by the parties as a final
      expression of their agreement and intended to be a complete and exclusive
      statement of the agreement and understanding of the parties hereto in respect
      of
      the subject matter contained herein.  This Agreement supersedes all
      prior agreements and understandings between the parties with respect to such
      subject matter.

     

    (k)           Governing
      Law; Consent to Jurisdiction; Waiver of Jury Trial.  This
      Agreement shall be governed by, and construed in accordance with, the internal
      laws of the State of New York without regard to the choice of law principles
      thereof.  Each of the parties hereto irrevocably submits to the
      exclusive jurisdiction of the courts of the State of New York and United States
      District Courts located in New York City, New York for the purpose of any suit,
      action, proceeding or judgment relating to or arising out of this Agreement
      and
      the transactions contemplated hereby.  Service of process in
      connection with any such suit, action or proceeding may be served on each party
      hereto anywhere in the world by the same methods as are specified for the giving
      of notices under this Agreement.  Each of the parties hereto
      irrevocably consents to the jurisdiction of any such court in any such suit,
      action or proceeding and to the laying of venue in such court.  Each
      party hereto irrevocably waives any objection to the laying of venue of any
      such
      suit, action or proceeding brought in such courts and irrevocably waives any
      claim that any such suit, action or proceeding brought in any such court has
      been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES
      ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS
      AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO
      THIS
      WAIVER.

     

     

     

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

     

     

     

    (l)           Currency.
      All reference to dollars ($) or currency in this Agreement are to United States
      Dollars.

     

    

     [signature
      page follows]

     

     

     

     

     

     

     

    

    
      
        
           

        

        
          14

          
            

          

        

        
           

        

      

    

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement or caused their duly
      authorized officers to execute this Agreement as of the date first above
      written.

    

      
        	
                The
                  Company:

              	
                ALTAIR
                  NANOTECHNOLOGIES, INC.

              
	 	 
	 	 
	 	 
	 	
                By:
                  /s/ Alan
                  Gotcher                                   
                  

              
	 	
                Name:
                  Alan Gotcher

              
	 	
                Title:
                  President and CEO

              
	 	 
	 	 
	 	 
	
                Investor:

              	
                AL
                  YOUSUF LLC

              
	 	 
	 	
                By:
                  /s/ Iqbal Al
                  Yousuf                                                  
                  

              
	 	
                Name:
                  Iqbal Al Yousuf

              
	 	
                Title:
                  President

              
	 	 

      

    

    

     

     

     

     

    Signature
      Page to Registration Rights Agreement
       Altair
        Nanotechnologies Inc. and Al Yousuf, LLC

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