Exhibit 10.1

GP STRATEGIES CORPORATION

SECURITIES PURCHASE AGREEMENT

December 30, 2009

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SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGREEMENT (the “ Agreement ”), dated as of December 30, 2009, by and among GP Strategies Corporation, a Delaware corporation, with headquarters located at 6095 Marshalee Drive, Suite 300, Elkridge, MD 21075 (the “ Company ”), and Sagard Capital Partners, L.P., a Delaware limited partnership (the “ Investor ”).  Certain defined terms used herein are listed in Section 8(a) .

WHEREAS:

A.             Each of the Company and the Investor is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(2) of the Securities Act of 1933, as amended (the “ 1933 Act ”), and Rule 506 of Regulation D (“ Regulation D ”) as promulgated by the United States Securities and Exchange Commission (the “ SEC ”) under the 1933 Act.

B.             The Investor wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, 2,857,143 shares (the “ Purchased Shares ”) of the Company’s common stock, par value $0.01 per share (the “ Common Stock ”).

C.             Contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights Agreement, substantially in the form attached hereto as Exhibit A (the “ Registration Rights Agreement ”), pursuant to which the Company has agreed to provide certain registration rights with respect to the Registrable Securities (as defined in the Registration Rights Agreement), under the 1933 Act and the rules and regulations promulgated thereunder, and applicable state securities Laws.

NOW, THEREFORE, the Company and the Investor hereby agree as follows:

1.              PURCHASE AND SALE OF COMMON STOCK .

(a)            Common Stock .  Subject to the receipt (or waiver) of the deliverables set forth in Sections 5 and  6 below, the Company shall issue and sell to the Investor, and the Investor agrees to purchase from the Company on the Closing Date, the Purchased Shares.

(b)            Closing .  The closing (the “ Closing ”) of the purchase of the Purchased Shares by the Investor shall occur at the offices of Finn Dixon & Herling LLP, 177 Broad Street, Stamford, Connecticut 06901.  The date and time of the Closing (the “ Closing Date ”) shall be 10:00 a.m., New York City Time, on the first Business Day on which the conditions to the Closing set forth in Sections 5 and  6 below have been satisfied or waived (or such other date and time as is mutually agreed to by the Company and the Investor).

(c)            Purchase Price .  The aggregate purchase price for the Purchased Shares to be purchased by the Investor (the “ Purchase Price ”) shall be $20,000,001.00.  The Investor shall pay $7.00 for each share of Common Stock to be purchased by the Investor at the Closing.

(d)            Form of Payment .  On the Closing Date, (i) the Investor shall pay the Purchase Price to the Company for the Purchased Shares to be issued and sold to the Investor at the

Closing, by wire transfer of immediately available funds in accordance with the Company’s written wire instructions, minus amounts withheld pursuant to Section 4(f)(i)  and the Company shall deliver to the Investor the Purchased Shares, evidenced by one or more stock certificates, free and clear of all restrictive legends (except as expressly provided in Section 4(p)  hereof).

2.              INVESTOR’S REPRESENTATIONS AND WARRANTIES .

As of the date hereof, the Investor represents and warrants that:

(a)            Organization; Authority .  The Investor is a limited partnership duly organized, validly existing and in good standing under the Laws of the jurisdiction of its organization with the requisite limited partnership power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder and thereunder.

(b)            No Public Sale or Distribution .  The Investor is acquiring the Purchased Shares for its own account and not with a view towards, or for resale in connection with, the public sale or distribution thereof, except pursuant to sales registered or exempted under the 1933 Act; provided , however , that by making the representations herein, the Investor does not agree to hold any of the Purchased Shares for any minimum or other specific term and reserves the right to dispose of the Purchased Shares at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.  The Investor is acquiring the Purchased Shares hereunder in the ordinary course of its business.  The Investor does not presently have any agreement or understanding, directly or indirectly, with any Person to distribute any of the Purchased Shares in violation of the 1933 Act.

(c)            Accredited Investor Status .  The Investor is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D.

(d)            Reliance on Exemptions .  The Investor understands that the Purchased Shares are being offered and sold to it in reliance on specific exemptions from the registration requirements of United States federal and state securities Laws and that the Company is relying in part upon the truth and accuracy of, and the Investor’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Investor set forth herein in order to determine the availability of such exemptions and the eligibility of the Investor to acquire the Purchased Shares.

(e)            Information .  The Investor and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Purchased Shares which have been requested by the Investor.  The Investor and its advisors, if any, have been afforded the opportunity to ask questions of the Company.  Neither such inquiries nor any other due diligence investigations conducted by the Investor or its advisors or representatives, nor any other statement in this Section 2 , shall modify, amend or affect the Company’s representations and warranties contained herein or the Investor’s right to rely thereon.  The Investor understands that its investment in the Purchased Shares involve a high degree of risk.  The Investor has sought such accounting, legal and tax advice as it

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has considered necessary to make an informed investment decision with respect to its acquisition of the Purchased Shares.

(f)             No Governmental Review .  The Investor understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Purchased Shares or the fairness or suitability of the investment in the Purchased Shares nor have such authorities passed upon or endorsed the merits of the offering of the Purchased Shares.

(g)            Transfer or Resale .  The Investor understands that except as provided in the Registration Rights Agreement:

(i)             the Purchased Shares have not been and are not being registered under the 1933 Act or any state securities Laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) the Investor shall have delivered to the Company an opinion of counsel, in a generally acceptable form, to the effect that such Purchased Shares to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) the Investor provides the Company with reasonable assurance that such Purchased Shares can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under the 1933 Act, as amended, (or a successor rule thereto) (collectively, “ Rule 144 ”);

(ii)            any sale of the Purchased Shares made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and, further, if Rule 144 is not applicable, any resale of the Purchased Shares under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and

(iii)           neither the Company nor any other Person is under any obligation to register the Purchased Shares under the 1933 Act or any state securities Laws or to comply with the terms and conditions of any exemption thereunder.

The Purchased Shares may be pledged in connection with a bona fide margin account or other loan or financing arrangement secured by the Purchased Shares and such pledge of Purchased Shares shall not be deemed to be a transfer, sale or assignment of the Purchased Shares hereunder, and the Investor shall not be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other Transaction Document, including, without limitation, this Section 2(g) , in connection with such a pledge.

Investor has not, in anticipation of this Agreement and its acquisition of and investment in the Purchased Shares, and in any case during forty-five (45) days prior to the date hereof, effected any “short” sales with respect to the Common Stock or entered into any swap or any other agreement, transaction or series of transactions that hedges or transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether

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any such transaction, swap or series of transactions is to be settled by delivery of securities, in cash or otherwise.

(h)            Legends .  The Investor understands that, until such time as the resale of the Purchased Shares has been registered under the 1933 Act as contemplated by the Registration Rights Agreement, the stock certificate(s) representing the Purchased Shares, except as set forth in Section 4(p) , shall bear any legend as required by the “blue sky” Laws of any state and a restrictive legend in substantially the form set forth in Section 4(p)  (and a stop-transfer order may be placed against transfer of such stock certificates).

(i)             Validity; Enforcement .  This Agreement and the Registration Rights Agreement have been duly and validly authorized, executed and delivered on behalf of the Investor and shall constitute the legal, valid and binding obligations of the Investor enforceable against the Investor in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar Laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.

(j)             No Conflicts .  The execution, delivery and performance by the Investor of this Agreement and the Registration Rights Agreement and the consummation by the Investor of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents of the Investor or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Investor is a party, or (iii) result in a violation of any Law (including federal and state securities Laws) applicable to the Investor, except in the case of clauses (ii)  and (iii)  above, for such conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Investor to perform its obligations hereunder.

(k)            Residency .  The Investor’s principal office is located in the State of Connecticut.

3.              REPRESENTATIONS AND WARRANTIES OF THE COMPANY .

The Company represents and warrants to the Investor as of the date hereof that, except as otherwise disclosed or incorporated by reference in: (i) the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, or its other reports and forms filed with or furnished to the SEC under Sections 12, 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the “ 1934 Act ”), after December 31, 2008 and before the date of this Agreement (including any amendments or supplements thereto, but excluding risk factors and/or any other disclosures of risks included in any forward-looking statement disclaimers or other statements that are similarly nonspecific and are predictive and forward-looking in nature) (all such reports covered by this clause (i), collectively, the “ SEC Reports ”); or (ii) as set forth in the disclosure letter dated as of the date hereof provided to the Investor separately (the “ Disclosure Letter ”), specifically identifying the relevant subparagraph(s) hereof ( provided , that disclosure in any subparagraph of such disclosure letter shall apply to any section or subparagraph hereof to the

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extent it is reasonably apparent on its face that such disclosure is relevant to such section or subparagraph of this Agreement):

(a)            Organization and Qualification of the Company and its Significant Subsidiaries .  The Company and General Physics Corporation, a Delaware corporation, are entities duly organized and validly existing and in good standing under the Laws of the jurisdiction in which they are formed, and have the requisite power and authority to own their properties and to carry on their business as now being conducted.  General Physics (UK) Ltd, a United Kingdom limited company, is an entity duly organized and validly existing under the Laws of the jurisdiction in which it is formed, and has the requisite power and authority to own its properties and to carry on its business as now being conducted.  Each of the Company and its Significant Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not reasonably be expected to have a Material Adverse Effect.

(b)            Authorization; Enforcement; Validity .  The Company has the requisite power and authority to enter into and perform its obligations under this Agreement, the Registration Rights Agreement, the Confidentiality Agreement and each of the other agreements entered into by the Company in connection with the transactions contemplated by this Agreement (collectively, the “ Transaction Documents ”) and, in the case of the Company, to issue the Purchased Shares in accordance with the terms hereof and thereof.  The execution and delivery of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby, including, without limitation, the issuance of the Purchased Shares, have been duly authorized by the Company’s board of directors (the “ Board of Directors ”).  No further corporate consent, or authorization is required by the Company, the Board of Directors or the Company’s stockholders in connection with the execution and delivery of this Agreement and the other Transaction Documents to which it is a party and the performance of the Company’s obligations hereunder and thereunder.  This Agreement and the other Transaction Documents of even date herewith have been duly executed and delivered by the Company, and constitute the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar Laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.

(c)            Issuance of Purchased Shares; No Restrictions on Transfer .  The issuance of the Purchased Shares has been duly authorized by all necessary corporate action and, upon issuance in accordance with this Agreement, such Purchased Shares will be validly issued, fully paid and nonassessable, and free and clear of all liens and/or restrictions on transfer (other than restrictions on transfer provided for by applicable federal and state securities Laws) and will not be subject to preemptive rights of any other stockholder of the Company.  Subject to the representations and warranties of the Investor in this Agreement, the offer and issuance by the Company of the Purchased Shares are exempt from registration under the 1933 Act.

(d)            No Conflicts .  Except as set forth on Section 3(d)  of the Disclosure Letter, the execution, delivery and performance of the Transaction Documents by the Company and the

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consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Purchased Shares) will not (i) violate the Certificate of Incorporation or any certificate of incorporation, certificate of formation, or any certificate of designations or other constituent document of any of its Subsidiaries, or the Bylaws or any of its Subsidiaries’ bylaws, (ii) violate, conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, (iii) assuming the filing of a Form D and state securities Law filings, result in a violation of any Law (including federal and state securities Laws and the rules and regulations of the New York Stock Exchange or such other Eligible Market on which the Company may list the Common Stock from time to time (such Eligible Market, the “ Principal Market ”)) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected or (iv) result in or require the creation or imposition of any lien upon or with respect to any of the properties or assets of the Company or any of its Subsidiaries, except in the case of clauses (ii) , (iii)  and (iv) , as would not reasonably be expected to have a Material Adverse Effect.

(e)            Consents .  Other than the filing with the SEC of a Form D and one or more Registration Statements in accordance with the requirements of the Registration Rights Agreement and any other filings as may be required by any state securities agencies, except as set forth on Section 3(e)  of the Disclosure Letter, neither the Company nor any of its Subsidiaries is required to obtain any consent, authorization or order of, or make any filing or registration with, any court, governmental agency or any regulatory or self-regulatory agency (including the Principal Market) or any other Person in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction Documents, in each case in accordance with the terms hereof or thereof.  All consents, authorizations, orders, filings and registrations which the Company or any such Subsidiary is required to obtain pursuant to the preceding sentence will be obtained or effected on or prior to the Closing Date, and the Company and its Subsidiaries are unaware of any facts or circumstances which might prevent the Company from obtaining or effecting any of the registration, application or filings pursuant to the preceding sentence except as set forth on Section 3(c)  of the Disclosure Letter.  The Company is not in violation of the requirements of the Principal Market and has no Knowledge of any facts which would reasonably be expected to lead to delisting or suspension of the Common Stock in the foreseeable future.

(f)             No General Solicitation; Placement Agent’s Fees .  Neither the Company, nor any of its Subsidiaries or Affiliates, nor any Person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the offer or sale of the Purchased Shares.  The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, or brokers’ commissions (other than for Persons engaged by the Investor or any Person acting or claiming to act on behalf of the Investor) relating to or arising out of the transactions contemplated hereby.  Neither the Company nor any of its Subsidiaries has engaged any placement agent or other agent in connection with the sale of the Purchased Shares.

(g)            No Integrated Offering .  None of the Company, its Subsidiaries, any of their Affiliates, and any Person acting on their behalf has, directly or indirectly, made any offers or

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sales of any security or solicited any offers to buy any security, under circumstances that would require registration of any of the Purchased Shares under the 1933 Act or cause this offering of the Purchased Shares to be integrated with prior offerings by the Company for purposes of the 1933 Act or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of the Principal Market or any exchange or automated quotation system on which any of the securities of the Company are listed or designated.  None of the Company or its Subsidiaries or any Person acting on their behalf will take any action or steps referred to in the preceding sentence that would require registration of any of the Purchased Shares under the 1933 Act (except as contemplated by the Registration Rights Agreement) or cause the offering of the Purchased Shares to be integrated with other offerings.

(i)                                      Except as set forth on Section 3(h)  of the Disclosure Letter, the Company does not have in place a stockholder rights plan or similar arrangement relating to accumulations of beneficial ownership of Common Stock or a change in control of the Company.

(ii)                                   The Board of Directors has irrevocably waived, on behalf of the Company, any rights under Article Thirteenth with respect to (A) 18,700 shares of Common Stock presently held by the Investor, (B) the Purchased Shares, (C) any additional securities acquired pursuant to Section 4(l)  and (D) any other securities permitted to be acquired by the Investor under Section 4(o)(i)(A)  hereof.

(iii)                                The Company and its Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation or any certificates of designations or the laws of the jurisdiction of its formation or incorporation, or any other jurisdiction, which is or would reasonably be expected to become applicable to the Investor as a result of (i) the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the Purchased Shares and the Investor’s ownership of the Purchased Shares, (ii) the Investor’s purchase of securities pursuant to Section 4(l)  and (iii) any shares of Common Stock permitted to be acquired by the Investor under Section 4(o)(iv)  hereof.

(i)                                      SEC Documents; Financial Statements .

(i)                                      Except as set forth on Section 3(i)  of the Disclosure Letter, since December 31, 2006, the Company has timely filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements, notes and schedules thereto and documents incorporated by reference therein being hereinafter referred to as the “ SEC Documents ”).  The Company has delivered to the Investor or its representatives true, correct and complete copies of any such SEC Documents which are not available on the EDGAR system that have been requested by the Investor.  As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed

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with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.  There are no outstanding comments from the SEC with respect to any SEC Document.

(ii)            As of their respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto as in effect as of the time of filing.  Such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved (except (A) as may be otherwise indicated in such financial statements or the notes thereto, or (B) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations, changes in stockholders’ equity and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).

(j)             Accuracy of Information .  All factual information, taken as a whole, furnished by or on behalf of the Company and its Subsidiaries in writing to the Investor on or prior to the date of this Agreement, for purposes of this Agreement and all other such factual information, taken as a whole, furnished by the Company on behalf of itself and its Subsidiaries in writing to the Investor pursuant to the terms of this Agreement does 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 when considered with respect to the Company and/or its Subsidiaries, taken as a whole; provided , however , that with respect to any projected financial information or forward-looking statements, business assumptions, strategic plans or similar information, the Company represents only that such information was prepared in good faith based upon assumptions, and subject to such qualifications, believed to be reasonable at the time.  The Company understands and confirms that the Investor will rely on the representations and warranties contained in this Section 3 for purposes of purchasing the Purchased Shares pursuant to this Agreement.

(k)            Absence of Certain Changes .  Except as disclosed in Section 3(k)  of the Disclosure Letter, since December 31, 2008, no event or events have occurred that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

(i)             Without limiting the generality of the foregoing and except as set forth in Section 3(k)  of the Disclosure Letter, since December 31, 2008:

(A)           neither the Company nor any Subsidiary has issued any note, bond, or other debt security or created, incurred, assumed, or guaranteed any Indebtedness for borrowed money or capitalized lease obligation, individually or in the aggregate, in excess of $250,000;

(B)            neither the Company nor any Subsidiary has (x) acquired any other Person (or any significant business, portion or division thereof), whether by merger, consolidation or reorganization or by purchase of such Person’s assets or capital stock or

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otherwise and/or (y) terminated and/or made material modifications to any material provisions of any agreements evidencing or relating to the transactions described in the preceding clause (x) ;

(C)                                 neither the Company nor any Significant Subsidiary has made material changes in management personnel or entered into, or materially modified, any employment, severance or similar contract with any officer or management level employee;

(D)                                neither the Company nor any Significant Subsidiary has incurred any material penalty as a result of underperformance under, or alleged breach of, any contracts or agreements with any customer;

(E)                                  neither the Company nor any Subsidiary has accelerated, terminated, made material modifications to, or cancelled, any of the Material Contracts, nor has any counterparty to any such Material Contracts taken any of the foregoing actions in this clause (E)  with respect to any Material Contract;

(F)                                  neither the Company nor any Subsidiary has entered into, accelerated, terminated, made material modifications to, or cancelled, any contract or agreement, which involves more than $250,000, relating to or involving any earnout payment or the deferred purchase price of property or services other than accounts payable incurred and payable on terms customary in the business of the Company or its Subsidiaries;

(G)                                 neither the Company nor any Significant Subsidiary has committed to any of the matters described in clauses (C)  and/or (D)  above; and

(H)                                neither the Company nor any Subsidiary has committed to any of the matters described in clauses (A) , (B) , (E)  and/or (F)  above.

(ii)                                   Neither the Company nor any of its Significant Subsidiaries has taken any steps to seek protection pursuant to any bankruptcy Law nor does the Company have any Knowledge or reason to believe that its creditors intend to initiate involuntary bankruptcy proceedings or any actual Knowledge of any fact which would reasonably lead a creditor to do so.  The Company and its Significant Subsidiaries, individually and on a consolidated basis, are not as of the date hereof, and after giving effect to the transactions contemplated hereby to occur at the Closing will not be, Insolvent (as defined below).

(l)                                      No Undisclosed Events, Liabilities, Developments or Circumstances .  Neither the Company nor any of the Company’s Subsidiaries has any liabilities or obligations of any nature (absolute, accrued, contingent or otherwise) which are not properly reflected or reserved against in the Company’s financial statements included in the SEC Documents to the extent required to be so reflected or reserved against in accordance with generally accepted accounting principles in the United States, except for (i) liabilities that have arisen in the ordinary course of business consistent with past practice and that have not had a Material Adverse Effect, and (ii) liabilities that have not had and would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

(m)                                Conduct of Business; Regulatory Permits .  Except as set forth on Section 3(m)  of the Disclosure Letter:

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(i)                                      Neither the Company nor any of its Significant Subsidiaries is in violation of any term of its Certificate of Incorporation, any certificate of designation, preferences or rights of any outstanding series of preferred stock of the Company or Bylaws or their organizational documents or certificate of incorporation or bylaws, respectively.  Since December 31, 2008, each of the Company and each Subsidiary has complied in all material respects with all applicable Laws, other than such noncompliance that would not reasonably be expected to, either individually or in the aggregate, result in a Material Adverse Effect.

(ii)                                   Without limiting the generality of the foregoing, the Company is not in violation of any of the rules, regulations or requirements of the Principal Market and has no Knowledge of any facts or circumstances that would reasonably lead to delisting or suspension of the Common Stock by the Principal Market in the foreseeable future.  Since January 1, 2006, (A) the Common Stock has been designated for quotation on the Principal Market, (B) trading in the Common Stock has not been suspended by the SEC or the Principal Market and (C) the Company has received no communication, written or oral, from the SEC or the Principal Market advising of or threatening the suspension or delisting of the Common Stock from the Principal Market.

(iii)                                (x) The Company and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate regulatory authorities necessary to conduct their respective businesses, and (y) neither the Company nor any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit, except in the case of (x) and (y) where such failure or receipt of notice of proceedings, as the case may be, would not reasonably be expected to, either individually or in the aggregate, result in a Material Adverse Effect.

(n)                                  Foreign Corrupt Practices and/or Other Payments .  Neither the Company nor, to the Knowledge of the Company, any of its Subsidiaries nor any director, officer, agent, employee or other Person acting on behalf of the Company or any of its Subsidiaries has, in the course of its actions for, or on behalf of, the Company or any of its Subsidiaries (i) made any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other anti-bribery or anti-corruption Laws applicable to the Company or any of its Subsidiaries; (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee; or (v) made any bribe, rebate, payoff, influence payment, kickback or other payment to, for the benefit of, or at the request of, any employee of any customer of the Company or any Subsidiary which might reasonably be expected to result in such customer modifying its purchases of services and/or products from the Company.

(o)                                  Sarbanes-Oxley Act .  The Company is in material compliance with (x) any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and (y) any and all applicable rules and regulations promulgated by the SEC thereunder that are effective as of the date hereof, in the case of (x) and (y), when taken as a whole.

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(p)                                  Transactions With Affiliates .  Except as set forth in the SEC Documents filed at least ten (10) days prior to the date hereof and other than the outstanding stock options and/or restricted stock disclosed on Section 3(p)  of the Disclosure Letter, none of the officers, directors or employees of the Company or any of its Significant Subsidiaries is presently a party to any transaction with the Company or any of its Significant Subsidiaries (other than for ordinary course services as employees, officers or directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from, any such officer, director or employee or, to the Knowledge of the Company or any of its Significant Subsidiaries, any corporation, partnership, trust or other entity in which any such officer, director, or employee has a substantial interest or is an officer, director, trustee or partner.

(q)                                  Equity Capitalization .  As of the date hereof, the authorized capital stock of the Company consists of (i) 35,000,000 shares of Common Stock, of which as of the date hereof, 15,723,767 are issued and outstanding and 1,250,682 shares are reserved for issuance pursuant to securities exercisable or exchangeable for, or convertible into, shares of Common Stock and (ii) 10,000,000 shares of preferred stock of which, as of the date hereof, none are issued and outstanding.  All of such outstanding shares have been, or upon issuance will be, validly issued and are fully paid and nonassessable.  Except as set forth on Section 3(q)  of the Disclosure Letter, (i) none of the Company’s capital stock is subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any capital stock of the Company or any of its Significant Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Significant Subsidiaries is or may become bound to issue additional capital stock of the Company or any of its Significant Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any capital stock of the Company or any of its Significant Subsidiaries; (iii) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities, whether presently outstanding or securities that may be issued subsequently, under the 1933 Act (except pursuant to the Registration Rights Agreement); (iv) there are no outstanding securities or instruments of the Company or any of its Significant Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Significant Subsidiaries is or may become bound to redeem a security of the Company or any of its Significant Subsidiaries; (v) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Purchased Shares; and (vi) the Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.  To the Company’s Knowledge, no stockholder of the Company has entered into any agreement with respect to the voting of equity securities of the Company.  The Company has furnished to the Investor true, correct and complete copies of the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof (the “ Certificate of Incorporation ”), and the Company’s Bylaws, as amended and as in effect on the date hereof (the “ Bylaws ”), and the terms of all securities convertible into, or exercisable or exchangeable for, shares of Common Stock and the material rights of the holders thereof in respect thereto.  Section 3(q)  of the Disclosure Letter sets forth

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the shares of Common Stock owned beneficially or of record and Common Stock Equivalents (as defined below) held by each director and executive officer.

(r)                                     Indebtedness and Other Contracts .  Except as set forth in Section 3(r)  of the Disclosure Letter: (i) neither the Company nor any of its Significant Subsidiaries has any outstanding Indebtedness (as defined below), (ii) neither the Company nor any of its Subsidiaries is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies) to such contract, agreement or instrument would reasonably be expected to result in a Material Adverse Effect, or (iii) neither the Company nor any of its Significant Subsidiaries is in material violation of any term of or in material default under any material contract, agreement or instrument relating to any Indebtedness.  The Company has provided the Investor with a true, correct and complete list of: (i) all presently existing contracts or agreements (or series of related contracts or agreements) to which the Company or its Subsidiaries are party or by which they are bound involving payments in excess of $250,000 in calendar year 2009 and (ii) all contracts or agreements with the top ten (10) customers of the Company and its Significant Subsidiaries (based on total purchases, in dollars) during the fiscal year ended December 31, 2008 and current year-to-date (collectively, the “ Material Contracts ,” and each a “ Material Contract ”).

(s)                                   Absence of Litigation .  Except as set forth in Section 3(s)  of the Disclosure Letter, there is no action, suit, proceeding, inquiry or investigation before or by the Principal Market, any court, public board, government agency, self-regulatory organization or body pending or, to the Knowledge of the Company, threatened against or affecting the Company or any of its Subsidiaries, or, to the Company’s Knowledge, any of the Company’s or its Subsidiaries’ officers or directors, that (i) is reasonably likely to have a Material Adverse Effect, (ii) purports to affect the legality, validity or enforceability of this Agreement or any other Transaction Document or the consummation of the transactions contemplated by this Agreement or by any of the other Transaction Documents or (iii) alleges criminal conduct.

(t)                                     Insurance .  The Company and each of its Significant Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its Significant Subsidiaries are engaged.  Except as set forth on Section 3(t)  of the Disclosure Letter, the Company does not engage in any self-insurance arrangements.  Neither the Company nor any such Significant Subsidiary has been refused any insurance coverage sought or applied for and neither the Company nor any such Significant Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to result in a Material Adverse Effect.  The Company has provided the Investor with a true, correct and complete list of all existing insurance policies, including their respective retention amounts and/or deductibles.

(u)                                  Employee Relations .

(i)                                      Except as set forth on Section 3(u)  of the Disclosure Letter, neither the Company nor any of its Subsidiaries is a party to any collective bargaining agreement or to the Knowledge of the Company, employs any member of a union.  To the Knowledge of the

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Company, no executive officer (as defined in Rule 501(f) of the 1933 Act) of the Company or any of its Significant Subsidiaries has notified the Company or any such Significant Subsidiary that such officer intends to leave the Company or any such Significant Subsidiary or otherwise terminate such officer’s employment with the Company or any such Significant Subsidiary.  To the Knowledge of the Company, no executive officer of the Company or any of its Significant Subsidiaries is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement, non-competition agreement, or any other contract or agreement or any restrictive covenant, and the continued employment of each such executive officer does not subject the Company or any of its Significant Subsidiaries to any liability with respect to any of the foregoing matters.

(ii)                                   The Company and its Subsidiaries have complied with all federal, state, local and foreign Laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions of employment and wages and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  All persons classified by the Company or its Subsidiaries as independent contractors, consultants or as self-employed do satisfy and have satisfied the requirements of any applicable Law to be so classified, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(v)                                  Company Benefit Plans .

(i)                                      Set forth on Section 3(v)  of the Disclosure Letter is a complete and correct list of (A) all Benefit Plans that are presently maintained or contributed to by the Company or any Subsidiary or with respect to which the Company or any Subsidiary has any material liability, (B) all “employee pension benefit plans” (as defined in ERISA §3(2)) that have been maintained or contributed to in the last six (6) years by the Company or any Subsidiary and (C) all plans presently maintained in a jurisdiction other than the U.S. which relate to pension or retirement benefits provided to employees that would be “employee pension benefit plans” (as defined in ERISA §3(2)) if such plans were subject to ERISA that have been maintained or contributed to in the last six (6) years by the Company or any Subsidiary, in each case (A) , (B)  or (C)  which provide benefits to any current or former director, officer, employee or service provider of the Company or any Subsidiary, or the dependents of any thereof (each plan in this clause (i) , a “ Plan ,” and collectively, the “ Plans ”).

(ii)                                   Neither the Company nor any ERISA Affiliate contributes to, has, or in the last six (6) years has had, any obligation to contribute to, or has any material liability under or with respect to any Employee Pension Benefit Plan that is a “defined benefit plan” (as defined in ERISA §3(35)).

(iii)                                Neither the Company nor any ERISA Affiliate contributes to, or has any obligation to contribute to, or has any material liability (including withdrawal liability as defined in ERISA §4201) under or with respect to any Multiemployer Plan.

(iv)                               Except as set forth on Section 3(v)  of the Disclosure Letter, (A) neither the execution and delivery of this Agreement, nor the consummation of the transactions

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contemplated hereby will (1) result in any payment (including severance, unemployment compensation, “excess parachute payment” (within the meaning of Section 280G of the Code), forgiveness of indebtedness or otherwise) becoming due to any current or former employee, officer or director of the Company or any of its Subsidiaries from the Company or any of its Subsidiaries under any Plan or otherwise, (2) increase any benefits otherwise payable under any Plan, (3) result in any acceleration of the time of payment or vesting of any such benefits, (4) require the funding or increase in the funding of any such benefits or (5) result in any limitation on the right of the Company or any of its Subsidiaries to amend, merge, terminate or receive a reversion of assets from any Plan or related trust and (B) neither the Company nor any of its Subsidiaries has taken, or permitted to be taken, any action that required, and no circumstances exist that will require the funding, or increase in the funding, of any benefits or resulted, or will result, in any limitation on the right of the Company or any of its Subsidiaries to amend, merge, terminate or receive a reversion of assets from any Plan or related trust.

(v)                                  No action, suit, proceeding, hearing or investigation with respect to any Plan or the administration or the investment of the assets thereof (other than routine claims for benefits) is pending or, to the best Knowledge of the Company, threatened; the Company has no Knowledge of any basis for any such action, suit, proceeding, hearing, or investigation.

Except for the representations and warranties of the Company expressly set forth in this Section 3(v) , the Company makes no other express or implied representation or warranty with respect to the Plans, or the matters covered by the representations and warranties contained in this Section 3(v) , and none of the other representations and warranties contained in this Agreement shall be deemed to be given in relation to the Plans.

(w)                                Title .  Except as set forth on Section 3(w)  of the Disclosure Letter, the Company and its Subsidiaries have good and marketable fee simple title to, or a valid leasehold interest in, all of the real property owned or leased by the Company, and good and marketable title to, or valid leasehold interests in, all of their personal property, except where the failure to hold such title or leasehold interests, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.  The Company and its Subsidiaries enjoy peaceful and undisturbed possession under all of their respective leases except where the failure to enjoy such peaceful and undisturbed possession, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

(x)                                    Intellectual Property Rights .  The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, original works of authorship, trade secrets and other intellectual property rights and all applications related thereto necessary to conduct their respective businesses as now conducted, except where the failure to so own or possess would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect (collectively, “ Intellectual Property Rights ”).  None of the patents, patent applications, trademark and service mark registrations and applications, or copyright registrations and applications owned by the Company and its Subsidiaries and included in the Intellectual Property Rights (collectively, the “ Registered Intellectual Property ”) has expired, terminated or been abandoned, or are expected to expire, terminate or be abandoned, within three years from the date of this Agreement, except where such expiration, termination or

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abandonment, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.  The Company does not have any Knowledge of any infringement by the Company or any of its Subsidiaries of Intellectual Property Rights of third parties that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  There is no claim, action or proceeding pending, or to the Knowledge of the Company, threatened, against the Company or any of its Subsidiaries challenging the validity, enforceability, ownership or use of any item of the Registered Intellectual Property that could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  The Company and its Significant Subsidiaries use commercially reasonable efforts to protect the secrecy, confidentiality and value of all of their Intellectual Property Rights.

(y)                                  Environmental Laws .  The Company and its Subsidiaries (i) have complied in all material respects with any and all applicable Environmental Laws (as hereinafter defined), (ii) have received all permits, licenses or other approvals currently required of them under applicable Environmental Laws to conduct their respective businesses and (iii) have complied in all material respects with all terms and conditions of any such permit, license or approval where, in each of the foregoing clauses (i) , (ii)  and (iii) , the failure to so comply or have received such permits, licenses or approvals would be reasonably expected to result in, individually or in the aggregate, a Material Adverse Effect.  The term “ Environmental Laws ” means all federal, state, local or foreign Laws relating to pollution or protection of human health or the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata), including, without limitation, Laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “ Hazardous Materials ”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials.  Except for the representations and warranties of the Company expressly set forth in this Section 3(y) , the Company makes no other express or implied representation or warranty with respect to matters covered by the representations and warranties contained in this Section 3(y) , and none of the other representations and warranties contained in this Agreement shall be deemed to be given in relation to the matters covered by the representations and warranties contained in this Section 3(y) .

(z)                                    Subsidiaries .  Section 3(z)  of the Disclosure Letter sets forth a complete and accurate list of all active direct and indirect Subsidiaries of the Company, showing, in each case, as of the date of this Agreement (as to each such Subsidiary) the jurisdiction of its formation, and, with respect to each non-wholly owned Subsidiary, the number of shares, membership interests or partnership interests (as applicable) of each class of its equity interests authorized, and the number outstanding, on the date of this Agreement and the percentage of each such class of its equity interests owned (directly or indirectly) by the Company, and the number of shares covered by all outstanding options, warrants, rights of conversion or purchase and similar rights as of the date of this Agreement.  All of the outstanding equity interests in each of the Subsidiaries of the Company have been validly issued, are fully paid and non-assessable and are owned by the Company or one or more of its subsidiaries, free and clear of all liens.  Except as set forth in Schedule 3(z) , the Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to limitations imposed by applicable Law) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the Company or such Subsidiary.  Except for the Significant Subsidiaries, the Company has no direct or indirect

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Subsidiaries which, individually or if considered in the aggregate as a single subsidiary, would satisfy the criteria for being a “significant subsidiary” as such term is defined in Rule 1-02(w) of Regulation S-X under the 1934 Act.

(aa)                             Tax Status .  Each of the Company and its Subsidiaries (i) has timely made or filed all foreign, federal and state income and all other material tax returns, reports and declarations required by any jurisdiction to which it is subject, and (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith or where the failure to file such returns, reports or declarations or pay such taxes, assessments or charges would not, individually or in the aggregate, have or be reasonably likely to have a Material Adverse Effect.  All such returns were complete and correct in all material respects, except for any deficiency that would not, individually or in the aggregate, have or be reasonably expected to have a Material Adverse Effect.  The Company has no Knowledge of a material tax deficiency which has been asserted or threatened in writing against the Company or any of its Subsidiaries which would, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect.  The Company has set aside on its books provision which is reasonably adequate (as determined with respect to the date with respect to which such provision was made) for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply through the date of such books, except for a deficiency that would not, individually or in the aggregate, have or be reasonably likely to have a Material Adverse Effect.  Except as set forth on Section 3(aa) of the Disclosure Letter, neither the Company nor any of its Subsidiaries is under audit by any taxing authority for which a material amount of taxes might be asserted.

(bb)                           Internal Accounting and Disclosure Controls .  The Company and its Subsidiaries, taken as a whole, 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 and liability accountability, (iii) access to assets or incurrence of liabilities is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for assets and liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action is taken with respect to any difference.  The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-14 under the 1934 Act) that are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC, including, without limitation, controls and procedures designed in to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is accumulated and communicated to the Company’s management, including its principal executive officer or officers and its principal financial officer or officers, as appropriate, to allow timely decisions regarding required disclosure.  Except as set forth in Section 3(bb) of the Disclosure Letter, during the twelve (12) months prior to the date hereof neither the Company nor any of its Subsidiaries have received any notice or correspondence from any accountant relating to any potential material weakness in any part of the system of internal accounting controls of the Company or any of its Subsidiaries.

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(cc)                             Off Balance Sheet Arrangements .  There is no material transaction, arrangement, or other relationship between the Company and an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act filings and is not so disclosed.

(dd)                           Investment Company Status .  The Company is not, and upon consummation of the sale of the Purchased Shares will not be, an “investment company,” a company controlled by an “investment company” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment company” as such terms are defined in the Investment Company Act of 1940, as amended.

(ee)                             Manipulation of Price .  The Company has not, and to its Knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Purchased Shares, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of the Purchased Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company.

(ff)                                 Shell Company Status .  The Company is not, and during the last three (3) years has not been, an issuer of the type described in paragraph (i) of Rule 144 under the 1933 Act.

Except for the representations and warranties expressly set forth in this Agreement, Investor acknowledges that none of the Company or any of its respective Subsidiaries and Affiliates or any other Person makes any representation or warranty, express or implied, at law or in equity, with respect to the Company or any of its respective Subsidiaries or Affiliates, the Common Stock or any of the assets or liabilities of the Company and its respective Subsidiaries and Affiliates, or with respect to any other information provided to Investor, whether on behalf of the Company or such other Persons, including as to the probable success or profitability of the Company after the Closing.  Neither the Company nor any other Person will have or be subject to any Liability or indemnification obligation to Investor or any other Person resulting from the distribution to Investor, or Investor’s use of, any such information, including any information, document or material made available to Investor in certain “data rooms,” management presentations or in any other form in expectation or contemplation of the transactions contemplated by this Agreement.

4.                                        COVENANTS .

(a)                                   Form D and Blue Sky .  The Company agrees to file a Form D with respect to the Purchased Shares as required under Regulation D and to provide a copy thereof to the Investor promptly after such filing.  The Company shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for or to qualify the Purchased Shares for sale to the Investor at the Closing pursuant to this Agreement under applicable securities or “Blue Sky” Laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken to the Investor on or prior to the Closing Date.  The Company shall make all filings and reports relating to the offer and sale of the Purchased Shares required under applicable securities or “Blue Sky” Laws of the states of the United States following the Closing Date.

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(b)                                  Reporting Status .  Until the date on which the Investor shall have sold all the Purchased Shares (the “ Reporting Period ”), the Company shall timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit such termination.  The Company shall take all actions necessary to maintain its eligibility to register the Purchased Shares for resale by the Investor on Form S-3.

(c)                                   Use of Proceeds .  The Company will use the proceeds from the sale of the Purchased Shares for general corporate purposes; provided , however , that such proceeds shall not be used to pay dividends or other distributions (as opposed to share repurchase programs which, for the avoidance of doubt, shall be permitted).

(d)                                  Financial Information; Access .

(i)                                      The Company agrees to send the following to the Investor during the Reporting Period (A) unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Reports and Quarterly Reports on Form 10-K, 10-KSB, 10-Q or 10-QSB, any interim reports or any consolidated balance sheets, income statements, stockholders’ equity statements and/or cash flow statements for any period other than annual, any Current Reports on Form 8-K and any registration statements (other than on Form S-8) or amendments filed pursuant to the 1933 Act and (B) copies of any notices and other information made available or given to the stockholders of the Company generally, contemporaneously with the making available or giving thereof to the stockholders.  As used herein “ Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by Law to remain closed.

(ii)                                   During the Reporting Period, the Company shall permit any authorized representatives designated by the Investor reasonable access during normal business hours and upon reasonable notice to visit and inspect any of the properties of the Company or any of its Subsidiaries, including their respective books of account, and to discuss their respective affairs, finances and accounts with their respective officers, all at such times as the Investor may reasonably request; provided , however , that the Company shall not be obligated pursuant to this paragraph to provide access to any information that it reasonably and in good faith, after receiving the advice of Company counsel, determines that such exclusion is necessary (A) in order to preserve the Company’s attorney-client privilege, (B) to prevent the disclosure of third party confidential information where the Company is under a contractual duty to preserve the confidentiality of such information in connection with any transaction or arrangement between the Company and such third party, (C) because there exists, or is reasonably expected to exist, a direct or potential conflict of interest between the Investor and the Company with respect to a transaction or arrangement, (D) to prevent the disclosure of a Company trade secret or confidential information (unless covered by an enforceable confidentiality agreement, in form acceptable to the Company) or (E) any information that is classified by the United States government or otherwise subject to restrictions pursuant to duly authorized resolutions of the Board of Directors or the board of directors of any Subsidiary as a result of such information

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being deemed classified by the Board of Directors or the board of directors of any Subsidiary, in each case acting in good faith.

(e)                                   Listing .  The Company shall promptly secure the listing of all of the Registrable Securities (as defined in the Registration Rights Agreement) upon the Principal Market and shall maintain such listing of all Registrable Securities from time to time issuable under the terms of the Transaction Documents.  Neither the Company nor any of its Subsidiaries shall take any action which would be reasonably expected to result in the delisting or suspension of the Common Stock on the Principal Market.  The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 4(e) .

(f)                                     Fees .

(i)                                      Upon the Closing of the transactions contemplated by this Agreement, the Company shall promptly assume and pay, or reimburse the Investor and its designee(s) for, all documented reasonable out-of-pocket fees and expenses incurred by or on behalf of the Investor in connection with the transactions contemplated by this Agreement (including all legal, investment banking, accounting, due diligence, and other fees and expenses), up to a maximum aggregate amount of $125,000.

(ii)                                   From and after the Closing, the Company shall be responsible for the payment of any fees incurred by or on behalf of the Investor and its designees in connection with any waivers, amendments or modifications to the Transaction Documents.

(iii)                                If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.

(iv)                               The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, or broker’s commissions (other than for Persons engaged by the Investor or any Person acting or claiming to act on behalf of the Investor) relating to or arising out of the transactions contemplated hereby.  The Company shall pay, and hold the Investor harmless against, any liability, loss or expense (including, without limitation, reasonable attorneys’ fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment.

(g)                                  Pledge of Purchased Shares .  The Company acknowledges and agrees that the Purchased Shares may be pledged by an Investor (as defined in the Registration Rights Agreement) in connection with a bona fide margin agreement or other loan or financing arrangement that is secured by the Purchased Shares.  The pledge of Purchased Shares shall not be deemed to be a transfer, sale or assignment of the Purchased Shares hereunder, and no Investor effecting a pledge of Purchased Shares shall be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other Transaction Document.  The Company hereby agrees to execute and deliver such

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documentation as a pledgee of the Purchased Shares may reasonably request in connection with a pledge of the Purchased Shares to such pledgee by an Investor.

(h)                                  Integration .  The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the 1933 Act) that would be integrated with the offer or sale of the Purchased Shares for purposes of the rules and regulations of any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: NYSE Amex, The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market or the New York Stock Exchange, such that it would require stockholder approval before the closing of such other transaction, unless stockholder approval is obtained before the closing of such subsequent transaction.

(i)                                      Disclosure of Transactions and Other Material Information .  On or before 8:30 a.m., New York City time, on the third (3 rd ) Business Day following the date of this Agreement, the Company shall issue a press release and file a current report on Form 8-K describing the terms of the transactions contemplated by the Transaction Documents in the form required by the 1934 Act and attaching the material Transaction Documents (including, without limitation, this Agreement, and the form of the Registration Rights Agreement) as exhibits to such filing (including all attachments, the “ 8-K Filing ”).  Subject to the foregoing, none of the Company, its Subsidiaries or the Investor shall issue any press releases or any other public statements with respect to the transactions contemplated hereby; provided , however , that (i) the Company shall be entitled, without the prior approval of the Investor, to make any press release or other public disclosure with respect to such transactions in substantial conformity with the 8-K Filing and contemporaneously therewith (provided that the Company shall consult with the Investor in connection with any such press release or other public disclosure prior to its release) and (ii) either party may make such disclosure as is required by applicable Law.

(j)                                      Additional Registration Statements .  Until the Effective Date (as defined in the Registration Rights Agreement), the Company shall not file a registration statement under the 1933 Act relating to securities held by any selling security holder other than the Investor.

(k)                                   Actions Regarding Anti-Takeover and Other Protections; Rights Amendment .  The Company and the Board of Directors shall take all necessary action, if any, in order to render inapplicable Article Thirteenth and any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or other agreements or the laws of its state of incorporation (including, without limitation, Section 203 of the Delaware General Corporation Law) that is or could become applicable to the Investor as a result of, or with respect to, (A) the 18,700 shares of Common Stock presently held by the Investor, (B) the Purchased Shares, (C) any additional securities acquired pursuant to Section 4(l)  and (D) any other securities permitted to be acquired by the Investor under Section 4(o)(iv)  hereof.

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(l)             Preemptive Rights - Additional Issuances of Purchased Shares .

(i)             The Company and the Investor hereby agree that the Investor shall be entitled to two independent preemptive rights under this Section 4(l) :

(1)            During the Regular Preemptive Period, the Investor shall have the right (the “ Regular Preemptive Right ”) to purchase its Pro Rata Percentage of Offered Securities in accordance with the terms and conditions of this Section 4(l) .

(2)            During the Special Preemptive Period, the Investor shall have the right (the “ Special Preemptive Right ”) to purchase Offered Securities in one or more Subsequent Placements in accordance with the terms and conditions of this Section 4(l) , independent of, and without any limitation due to, the Investor’s then-applicable Pro Rata Percentage; provided that the maximum aggregate purchase price payable for all Offered Securities purchased by the Investor upon all exercises of its Special Preemptive Right shall not exceed $5,000,000.  If the Investor desires to purchase Offered Securities upon exercise of its Special Preemptive Right, the Investor may purchase as much as 100% of the Offered Securities proposed to be issued in the applicable Subsequent Placement, subject to the foregoing $5,000,000 aggregate purchase price cap.  Offered Securities purchased upon exercise of the Regular Preemptive Right shall not be counted towards the $5,000,000 aggregate cap.

(ii)            For purposes of this Section 4(l) , the following definitions shall apply.

(1)            “ Common Stock Equivalents ” means, collectively, Options and Convertible Securities.

(2)            “ Convertible Securities ” means any stock or securities (other than Options) convertible into or exercisable or exchangeable for shares of Common Stock.

(3)            “ Options ” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.

(4)            “ Pro Rata Percentage ” means a ratio equal to (i) the sum of the number of shares of the Company’s Common Stock held by the Investor immediately prior to the issuance of the Offered Securities, calculated on a Fully-Diluted Basis, divided by (ii) the total number of shares of the Company’s Common Stock then outstanding, calculated on a Fully-Diluted Basis.  If, in connection with a Subsequent Placement, the Investor will purchase Offered Securities pursuant to its Special Preemptive Right, and if the Investor also desires to exercise its Regular Preemptive Right in such Subsequent Placement, then the Offered Securities to be purchased upon exercise of the Special Preemptive Right shall be taken into account for purposes of calculating the numerator in clause (i)  above and the denominator in clause (ii)  above when calculating the number of Offered Securities purchasable upon exercise of the Regular Preemptive Right in connection with such Subsequent Placement.

(5)            “ Regular Preemptive Period ” means the period beginning on the Closing Date and ending on a Regular Termination Event.

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(6)                                   “ Regular Termination Event ” means the earlier to occur of (i) such time as the Investor and/or its Affiliates no longer beneficially own, in the aggregate, at least fifty percent (50%) of the Purchased Shares (i.e., 1,428,571 shares of Common Stock) (adjusted to take into account any stock splits, reverse stock splits, stock dividends, recapitalizations, conversions and the like) and (ii) such time as the Investor and/or its Affiliates no longer beneficially own, in the aggregate, securities representing beneficial ownership of at least eight percent (8%) of the shares of Common Stock, calculated on a Fully-Diluted Basis (but excluding from the denominator, solely for purposes of this clause (ii) , any securities issued after the date hereof and on or prior to the date of calculation as consideration in any acquisition by the Company or any of its Subsidiaries of another business entity (or a division or material portion of the assets thereof), whether by merger, acquisition of equity, stock or assets, consolidation, reorganization or otherwise).

(7)                                   “ Special Preemptive Period ” means the period beginning on the Closing Date and ending on a Special Termination Event.

(8)                                   “ Special Termination Event ” means the earliest to occur of (i) such time as the Investor has purchased Offered Securities upon exercise(s) of its Special Preemptive Right with an aggregate purchase price of $5,000,000; (ii) the second anniversary of the date hereof; and (iii) such time as the Investor and/or its Affiliates no longer beneficially own, in the aggregate, at least seventy-five percent (75%) of the Purchased Shares (i.e., 2,142,857 shares of Common Stock) (adjusted to take into account any stock splits, reverse stock splits, stock dividends, recapitalizations, conversions and the like).

(9)                                   “ Subsequent Placement ” means any action to offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of the equity or equity equivalent securities of the Company or its Subsidiaries, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for shares of Common Stock or Common Stock Equivalents.

(iii)                                So long as either the Regular Preemptive Period and/or the Special Preemptive Period is in effect, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4(l)  in order to enable the Investor to exercise the Regular Preemptive Right and/or Special Preemptive Right, as applicable.

(1)                                   Prior to making any Subsequent Placement, the Company shall deliver to the Investor a written notice (the “ Offer Notice ”) of any proposed or intended issuance or sale or exchange (the “ Offer ”) of the securities being offered (the “ Offered Securities ”) in such Subsequent Placement, which Offer Notice shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or

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with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with the Investor the number of Offered Securities which it is entitled to purchase under this Section 4(l) .

(2)                                   To accept an Offer, in whole or in part, the Investor must deliver a written notice to the Company prior to the end of the tenth (10 th ) Business Day after the Investor’s receipt of the Offer Notice (the “ Offer Period ”), setting forth the portion of such Offered Securities that the Investor elects to purchase (the “ Notice of Acceptance ”).  Such notice shall constitute a non-binding indication of interest of the Investor to purchase the amount of Offered Securities so specified (or, in the case of the exercise of the Regular Preemptive Right, a proportionately lesser amount if the amount of Offered Securities to be offered in such Offer is subsequently reduced) at the price (or range of prices) and other terms set forth in the Company’s notice.  The failure to respond in such ten (10) Business Day period shall constitute a waiver of preemptive rights in respect of such offering.  Any notice provided by the Company pursuant to this Section 4(l) , and any information provided to the Investor otherwise in connection with such Offer, shall be subject to the terms of the Confidentiality Agreement applicable to “Evaluation Material” thereunder until the ninetieth (90 th ) day following the consummation of any such Offer, regardless of any termination thereof.  Notwithstanding the foregoing, if the Company desires to modify or amend the terms and conditions of the Offer prior to the expiration of the Offer Period, the Company shall deliver to the Investor a new Offer Notice and the Offer Period shall expire on the fifth (5 th ) Business Day after the Investor’s receipt of such new Offer Notice.

(3)                                   The Company shall have forty-five (45) days from the expiration of the Offer Period above to offer, issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Investor (the “ Refused Securities ”) pursuant to a definitive agreement(s) (the “ Subsequent Placement Agreement ”), but only upon terms and conditions that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer Notice.

(4)                                   If the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4(l)(iii)(3)  above), then the Investor may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Investor elected to purchase pursuant to Section 4(l)(iii)(2)  above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to the Investor pursuant to Section 4(l)(iii)(3)  above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities.  If the Investor so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Investor in accordance with Section 4(l)(iii)(1)  above.

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(5)                                   Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Investor shall acquire from the Company, and the Company shall issue to the Investor, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4(l)(iii)(4)  above if the Investor has so elected, upon the terms and conditions specified in the Offer.  The purchase by the Investor of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Investor of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Investor and its counsel.

(6)                                   Any Offered Securities not acquired by the Investor or other persons in accordance with Section 4(l)(iii)(3)  above may not be issued, sold or exchanged until they are again offered to the Investor under the procedures specified in this Agreement.

(7)                                   The Company and the Investor agree that if the Investor elects to participate in the Offer, (x) neither the Subsequent Placement Agreement with respect to such Offer nor any other transaction documents related thereto (collectively, the “ Subsequent Placement Documents ”) shall include any term or provisions whereby the Investor shall be required to agree to any restrictions in trading as to any securities of the Company owned by the Investor prior to such Subsequent Placement, and (y) the Investor shall be entitled to registration rights in such Subsequent Placement Documents which are at least as favorable to the Investor as the registration rights contained in the Registration Rights Agreement.

(8)                                   Notwithstanding the foregoing, the rights of the Investor contained in this Section 4(l)  shall not apply to the issuance of:  (A) Purchased Shares issued pursuant to this Agreement; (B) securities issued to employees, consultants, officers and directors of the Company, pursuant to equity compensation plans approved by the Board of Directors or grants of options outside of such plans approved by the Board of Directors; (C) securities issued or issuable pursuant to any rights or agreements, including, without limitation, convertible securities, options and warrants, provided that either (x) the Company shall have complied with the purchase right established by this Section with respect to the initial sale or grant by the Company of such rights or agreements, or (y) such rights or agreements existed on the date hereof and are disclosed in this Agreement or the schedules hereto (it being understood that any modification or amendment to any such pre-existing right or agreement subsequent to the date of this Agreement with the effect of increasing the percentage of the Company’s fully-diluted securities underlying such rights agreement shall not be included in this clause (C)(y) ); (D) securities issued in connection with any stock split, stock dividend, subdivision, combination, reclassification, exchange, recapitalization or similar transactions by the Company; (E) any securities issued after the date hereof as consideration in any acquisition by the Company or any of its Subsidiaries of another business entity (or a division or a material portion of the assets thereof), whether by merger, acquisition of equity, stock or assets, consolidation, reorganization or otherwise; (F) securities issued in connection with sponsored research, collaboration, technology license, development, original equipment manufacturer, marketing, joint venture investment or other similar

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agreements, strategic alliances or strategic transactions approved by the Board of Directors; (G) capital stock issued in satisfaction of indebtedness or other liability or in exchange for indebtedness; and/or (H) any right, option, or warrant to acquire any security convertible into the securities excluded from the restrictions contained in this Section 4(l)  pursuant to clauses (A) through (G)  above.

(9)                                   The Company and the Board of Directors shall take all necessary action, if any, in order to render inapplicable Article Thirteenth and any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or other agreements or the laws of its state of incorporation (including, without limitation, Section 203 of the Delaware General Corporation Law) that is or could become applicable to the Investor as a result of the Investor exercising its rights under this Section 4(l) .

(10)                             Any failure to exercise either the Regular Preemptive Right and/or Special Preemptive Right in any one instance shall not limit or affect the Investor’s right to exercise either or both of such rights in any other instance, subject to the terms of this Section 4(l) .

(m)                                Board Matters .

(i)                                      (A)                               The Company will promptly cause one person to be nominated by the Investor to be elected or appointed to the Board of Directors (the “ Board Representative ”), effective as of the Closing.  The election or appointment of the Board Representatives will be subject to satisfaction of the “independent director” requirements as such term is defined in the rules and regulations promulgated by the Principal Market, as well as all legal and governance requirements regarding service as a director of the Company.  At or prior to Closing, the Company shall take all corporate and other action necessary to cause the Board Representative to be elected or appointed to the Board of Directors effective as of Closing for an initial term ending at the next annual meeting of the shareholders of the Company.  From and after the expiration of such initial term until the termination of the Designated Period, the Company shall reduce the size of the Board of Directors to seven (7) and shall not increase the size of the Board of Directors to more than seven (7) directors, without the prior written consent of the Investor.  As of the Closing, the Investor has designated Daniel Friedberg as the Board Representative, and the Company acknowledges that, based upon information regarding Mr. Friedberg provided to the Company by the Investor as of the date of this Agreement, Mr. Friedberg meets all the legal and governance requirements regarding service as a director of the Company, as well as the “independent director” requirements as such term is defined in the rules and regulations promulgated by the Principal Market, as of such date.

(B)                                 Any individual other than Daniel Friedberg who is subsequently designated by the Investor as Board Representative pursuant to this Section 4(m)  must be reasonably acceptable to the Company and shall be required to be “independent” as such term is defined in the rules and regulations promulgated by the Principal Market.  If the Board Representative is not “independent”, the Board Representative shall not be entitled to serve on the Board of Directors and shall immediately resign from the Board of Directors.

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(C)                                 For so long as the Investor has the right to designate the Board Representative pursuant to this Section 4(m) , if any person (excluding any resident or other local director required to be appointed to the board of directors of any Subsidiary pursuant to applicable Law) not employed by the Company and/or its Subsidiaries is or becomes a member of the board of directors of any of the Company’s Subsidiaries (whether a current Subsidiary or hereafter acquired), the Board Representative shall also have the right to become a member of any such Subsidiary’s board of directors and the Company, and each such Subsidiary, shall cause the Board Representative to be elected as a director of each such Subsidiary, but in no event shall the size of any Subsidiary’s board of directors exceed seven (7).

(ii)                                   The Investor shall continue to have the right to designate or nominate (as applicable) a Board Representative during the Designated Period.  Following the termination of the Designated Period, the Company shall have no obligation to cause any nominees presented to the shareholders of the Company for election of the Board of Directors to include any nominee of the Investor.

(iii)                                During the Designated Period, and subject at all times to the last sentence of Section 4(m)(i)(A) , the Company shall take such action as is required under applicable Law, the rules and regulations in effect at such time of the Principal Market or such other market on which the Common Stock is then listed or quoted, the Company’s certificate of incorporation and its bylaws to include on the Board of Directors or in the slate of nominees recommended by the Board of Directors, such person nominated by the Investor pursuant to Section 4(m)(i) and/or (ii) .  The Company shall use its commercially reasonable efforts to have the Board Representative elected as a director of the Company and the Company shall solicit proxies for such person to the same extent as it does for any of its other nominees to the Board of Directors.  During the Designated Period, and subject at all times to the last sentence of Section 4(m)(i)(A) , if a vacancy is created at any time by the death, disability, retirement, resignation or removal of the Board Representative, the Investor may designate or nominate, as applicable, another individual to be elected to fill the vacancy created thereby, and the Company hereby agrees to take, at any time and from time to time, all actions necessary to accomplish the same.

(iv)                               All obligations of the Company pursuant to this Section 4(m)  shall terminate, and, upon request by the Board of Directors, the Investor shall cause the Board Representative to resign promptly from the Board of Directors, in each case upon the termination of the Designated Period.  Any vacancy created by such resignation may be filled by the Board of Directors or the shareholders of the Company in accordance with the Company’s articles of incorporation, the bylaws and applicable Law.  The Company may implement this provision by requiring the execution and delivery of a resignation letter by the Board Representative subject to termination of designation or nomination rights.

(v)                                  The Board Representative shall be entitled to serve on each committee of the Board of Directors (except as prohibited by applicable Law or any rule or regulation promulgated by the Principal Market).  In the event the Board Representative is not a member of a committee of the Board of Directors, the Board Representative shall have the right to attend and observe (but not vote at) each meeting of such committee and to receive from the Company copies of all notices, information and other material provided to members of such committee

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(except as prohibited by applicable Law and the rules and regulations promulgated by the Principal Market).

(vi)           The Board Representative shall be entitled to the same compensation, if any, the same indemnification and the same director and officer insurance in connection with his or her role as a director as the other members of the Board of Directors, and the Board Representative shall be entitled to reimbursement for documented, reasonable out-of-pocket expenses incurred in attending meetings of the Board of Directors or any committees thereof, to the same extent as the other members of the Board of Directors.  The Company agrees that such indemnification arrangements will be the primary source of indemnification and advancement of expenses in connection with the matters covered thereby and payment thereon will be made before, offset and reduce any other insurance, indemnity or expense advancement to which the Board Representative may be entitled or which is actually paid in connection with such matters, including as an employee of the Investor or any of its Affiliates.  The covenants in this Section 4(m)(vi) shall survive the Designated Period and any termination of obligations under Section 8(j) .

(vii)          The Company shall notify the Board Representative of all regular and special meetings of the Board of Directors and shall notify the Board Representative of all regular and special meetings of any committee of the Board of Directors of which the Board Representative is a member.  The Company shall provide the Board Representative with copies of all notices, minutes, consents and other materials provided to all other members of the Board of Directors concurrently with the provision of such materials to the other members of the Board of Directors.  The Board Representative and the Observer will be permitted to share information received from the Company with officers, directors, members, employees and representatives of the Investor and its Affiliates (which, for the avoidance of doubt, shall exclude Investor’s portfolio companies) and the Investor and such Affiliates may use such information for internal purposes; provided , that the Investor maintains reasonable procedures designed to prevent such information from being used in connection with the purchase or sale of securities of the Company in violation of applicable securities Laws and that such information is not used to compete with the Company; provided , further , that the Board Representative, the Observer, the Investor, its Affiliates and each of their respective officers, directors, members, employees and representatives shall keep all such information confidential and not disclose any such information in any manner whatsoever except as permitted under the Confidentiality Agreement.

(n)            Observer Rights .  In addition to the rights of the Investor under Section 4(m) , during the Designated Period, the Investor may designate one additional Person to attend meetings of the Board of Directors, the board of directors of any Subsidiary and each committee of any of the foregoing as an observer (“ Observer ”).  Following the termination of the Designated Period, the Company shall have no obligation to permit any Person designated by the Investor to attend meetings of the Board of Directors, the board of directors of any Subsidiary and any committee of any of the foregoing or otherwise receive any information under this Section 4(n) .  The Observer shall be entitled to receive notice of and have the right to attend any and all meetings of the Board of Directors, the board of directors of any Subsidiary and each committee of any of the foregoing in an observer capacity; provided , however , that the Observer shall not have the right to attend any meeting of (x) the board of directors of any Subsidiary or (y) any committee of the Board of Directors or the board of directors of any Subsidiary, in either

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case (x) and/or (y), at which the Board Representative is present.  The Company shall provide the Observer with copies of all notices, minutes, consents and other material in connection therewith at the same time as such materials are distributed to members of the Board of Directors, the board of directors of any Subsidiary and each committee of any of the foregoing; provided , that (i) the Investor shall cause the Observer to agree to, and shall be responsible for the Observer’s failure to, hold in confidence and trust and to act in a fiduciary manner with respect to all information provided to such Observer pursuant hereto and (ii) the Company, the Board of Directors, the board of directors of any Subsidiary and each committee of any of the foregoing shall have the right to withhold any information and to exclude the Observer from any meeting or portion thereof (A) if doing so is, in the opinion of counsel to the Company, advisable or necessary to protect the attorney-client privilege between the Company and counsel or (B) if the Board of Directors, the board of directors of any Subsidiary or any committee of any of the foregoing determines in good faith, after consultation with counsel, that fiduciary requirements under applicable Law would make attendance by such Observer not advisable.  The Company may require the Board Observer to enter into a confidentiality agreement, in a form reasonably satisfactory to the Company and the Investor, as may be reasonably necessary to preserve the confidentiality of any information provided to the Board Observer in connection with the observation rights granted hereunder.  The Observer shall have no right to vote on any matters presented to the Board of Directors, the board of directors of any Subsidiary or any committee of any of the foregoing.  All obligations of the Company pursuant to this Section 4(n) shall terminate upon the Investor ceasing to have the right to designate an Observer pursuant to this Section 4(n) .  The Observer shall be entitled to reimbursement for documented, reasonable out-of-pocket expenses incurred in attending meetings of the Board of Directors, the board of directors of any Subsidiary and each committee of any of the foregoing, to the same extent as members of such boards or committees consistent with the Company’s past reimbursement practice for board or committee members.

(o)            Standstill .  The Investor hereby agrees that during the Designated Period, unless specifically invited in writing by the Company, neither the Investor nor any entity or person which is controlled (as defined in Rule 12b-2 under the 1934 Act) directly or indirectly by the Investor (but specifically excluding, for the avoidance of doubt, any of the Investor’s portfolio companies in which the Investor holds less than 25% of the outstanding voting securities and where the Investor does not have representatives constituting a majority of the board of directors thereof) (each, a “ Investor Controlled Entity ”), will in any manner, directly or indirectly (including by directing or causing any other Person that is not the Investor or a Investor Controlled Entity):

(i)             effect or seek, offer or propose (whether publicly or otherwise) to effect, or announce any intention to effect or cause or participate in or in any way assist, facilitate or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in, (A) any acquisition of any assets, indebtedness or businesses of the Company or any of its Subsidiaries or any affiliates controlled by the Company (“ Company Controlled Affiliates ”), (B) any tender or exchange offer, merger or other business combination involving the Company, any of the Subsidiaries or Company Controlled Affiliates or assets of the Company or the Subsidiaries or Company Controlled Affiliates constituting a significant portion of the consolidated assets of the Company and its Subsidiaries, (C) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the

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Company or any of its Subsidiaries or Company Controlled Affiliates, or (D) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the SEC) or consents to vote any voting securities of the Company or any of its Company Controlled Affiliates;

(ii)            form, join or in any way participate in a “group” (as defined under the 1934 Act) with third parties with respect to any of the matters described in this Section 4(o) or otherwise act in concert with third parties in respect of any of the matters described in this Section 4(o) ;

(iii)           seek the removal of any directors from the Board of Directors or a change in the size or composition of the Board of Directors (it being understood that the foregoing shall not prohibit the Investor or any subsequent holder of Purchased Shares from voting any securities of the Company in any manner not otherwise prohibited by this Section 4(o) );

(iv)           effect or seek, offer or propose (whether publicly or otherwise) to effect, or announce any intention to effect or cause or participate in or in any way assist, facilitate or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in, any acquisition of any securities (or beneficial ownership thereof) or rights or options to acquire any securities (or beneficial ownership thereof) of the Company or any of its Subsidiaries or Company Controlled Affiliates if, after giving effect to any such acquisition, the Investor and/or any Investor Controlled Entity, either individually or in the aggregate, would beneficially own more than (A) until the second anniversary of the date hereof, nineteen and nine-tenths percent (19.9%) of the Common Stock (calculated on a Fully-Diluted Basis, but excluding from any such calculation any securities issued to the Investor as a result of its exercise of its Special Preemptive Rights, under Section 4(l) ), or (B) after such second anniversary, twenty-three percent (23.0%) of the Common Stock (calculated on a Fully-Diluted Basis);

(v)            take any action which would or would reasonably be expected to force the Company to make a public announcement regarding any of the types of matters set forth in clauses (i) and/or (iv) above; or

(vi)           enter into any discussions or arrangements with any third party with respect to any of the foregoing; provided , however , that the foregoing shall not restrict the ability of the Board Representative from exercising his fiduciary duties.

Notwithstanding the foregoing, if (x) the Board of Directors decides, in its sole discretion, to engage in a process that solicits third parties to determine their interest in a potential transaction (a “ Sale Process ”) that is intended to, or would reasonably be expected to, give rise to a Triggering Event, the Company shall invite the Investor to participate in such Sale Process on the terms and conditions generally made available to the other participants in such Sale Process or (y) a Triggering Event shall occur without the Company conducting such a Sale Process (either within a reasonable time period before or at any time after such Triggering Event), nothing in this Section 4(o) shall prohibit the Investor from submitting a proposal to the Board of Directors which competes with the Triggering Event (provided that nothing in this clause (y) shall entitle the Investor to any preferential treatment, compared to other parties).  Nothing contained in this Section 4(o) shall require the Board of Directors to engage in a Sale

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Process either before or after a Triggering Event.  At the discretion of the Board of Directors, for the avoidance of doubt, for so long as (and only for so long as) the Investor is participating in such a process or is submitting a competing proposal, the Board of Directors may require that the Board Representative resign and/or that the Observer rights in Section 4(n) be suspended (provided that, thereafter, (1) the Investor’s right to nominate a Board Observer under Section 4(m) shall be reinstated and the Company shall reappoint a Board Observer to the Board of Directors as soon as reasonably possible and (2) the Observer rights in Section 4(n) shall be reinstated).  For purposes of this Agreement, (i) a “ Triggering Event ” shall mean (A) the recommendation by the Board of Directors that stockholders tender their shares of Common Stock into a tender offer conducted by any party other than the Company or one of its Subsidiaries, which, if consummated, would result in a Change of Control, (B) the public disclosure that securities representing 33-1/3% or more of the voting power of the Company’s voting equity securities have been acquired, with the approval of the Board of Directors, by any Person (including any group of Persons acting in concert) other than the Investor and its Affiliates or (C) the Company publicly announces that it has entered into a definitive agreement providing for a merger, consolidation, share exchange, business combination, recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction, in each case involving a Change of Control or any purchase of substantially all of the assets or business of the Company and its Subsidiaries, taken as a whole, in each case conducted by any Person (including any group of Persons acting in concert) other than the Investor and its Affiliates, and (ii) “ Change of Control ” means the consummation of any transaction or series of related transactions, the result of which is that the stockholders of the Company as a group immediately prior thereto will have beneficial ownership of less than 50.1% of the equity securities of the surviving entity in such transaction immediately thereafter.

Furthermore, notwithstanding the foregoing, the provisions of this Section 4(o) shall terminate in the event of (x) the filing by the Company of a voluntary petition in bankruptcy; (y) the entry of an order of relief in any bankruptcy or insolvency proceeding in respect of the Company or the entry of an order that the Company is a bankrupt or insolvent; or (z) any involuntary proceeding seeking liquidation, reorganization or other relief against the Company under any bankruptcy, insolvency or other similar law now or hereafter in effect that has not been dismissed sixty (60) days after the commencement thereof.

The Investor also agrees during such period not to request that the Company amend or waive any provision of this Section 4(o) (including this sentence).

(p)            Legends .  The Investor agrees that the Company shall affix the following legend to the certificate(s) delivered to the Investor at Closing:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM,

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THAT REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of the Purchased Shares upon which it is stamped, unless otherwise required by state securities Laws, if (i) such Purchased Shares are registered for resale under the 1933 Act, (ii) in connection with a sale, assignment or other transfer, such holder provides the Company with an opinion of counsel, in a generally acceptable form, to the effect that such sale, assignment or transfer of the Purchased Shares may be made without registration under the applicable requirements of the 1933 Act, or (iii) such holder provides the Company with reasonable assurance that the Purchased Shares can be sold, assigned or transferred pursuant to Rule 144(b)(1)(i).

(q)            Transfer Taxes .  Any stock transfer, stamp, registration or other similar taxes or fees payable as a direct result of the sale and transfer of the Purchased Shares to the Investor hereunder shall be paid by the Company.  The party required by applicable Law to file tax returns required in connection with such taxes and fees shall file such tax returns.  Each party hereto shall use its commercially reasonable efforts to minimize such taxes and fees and to cooperate in the preparation, execution and filing of all tax returns and other documents required in connection with such taxes and fees.

(r)             Form W-9 .  At the Closing, the Investor shall deliver to the Company two duly completed and executed copies of Internal Revenue Service Form W-9.

(s)            No Short Sales, Etc. in Violation of the 1933 Act .  Except in compliance with the 1933 Act and any applicable interpretations of the SEC promulgated thereunder (including Interpretation A.65 of the SEC’s July 1997 Manual of Publicly Available Interpretations) the Investor will not effect any “short” sales with respect to the Purchased Shares or enter into any swap or any other agreement, transaction or series of transactions that hedges or transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Purchased Shares, whether any such transaction, swap or series of transactions is to be settled by delivery of securities, in cash or otherwise.

5.              INVESTOR CLOSING DELIVERABLES .

The obligation of the Company hereunder to issue and sell the Purchased Shares to the Investor at the Closing is subject to the receipt at or before, or accuracy at, the Closing, as the case may be, of each of the following; provided , that these deliverables are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing the Investor with prior written notice thereof:

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(i)             The Investor shall have delivered to the Company duly executed versions of each of the Transaction Documents to which it is a party.

(ii)            The Investor shall have delivered to the Company the Purchase Price for the Purchased Shares by wire transfer of immediately available funds pursuant to the wire instructions provided by the Company.

(iii)           The representations and warranties of the Investor shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as of the Closing Date (except for representations and warranties that speak as of a specific date, which shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as of such specified date).  The Company shall have received a certificate, executed by the Chief Executive Officer of the Investor, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Investor in the form attached hereto as Exhibit B .

(iv)           The Investor shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the purchase of the Purchased Shares.

(v)            The Investor shall have delivered to the Company an indemnification agreement in the form of Exhibit C , duly executed by the Board Representative, which indemnification agreement shall become effective upon the Board Representative becoming a member of the Board of Directors.

(vi)           The Investor shall have delivered to the Company such other documents relating to the transactions contemplated by this Agreement as the Company or its counsel may reasonably request.

6.              COMPANY CLOSING DELIVERABLES .

The obligation of the Investor hereunder to purchase the Purchased Shares at the Closing is subject to the receipt at or before, or accuracy at, the Closing, as the case may be, of each of the following; provided that these deliverables are for the Investor’s sole benefit and may be waived by the Investor at any time in its sole discretion by providing the Company with prior written notice thereof:

(i)             The Company shall have delivered to the Investor (A) duly executed versions of each of the Transaction Documents to which it is a party and (B) the Purchased Shares being purchased by the Investor at the Closing pursuant to this Agreement.

(ii)            The Investor shall have received the opinion of (i) Latham & Watkins LLP, the Company’s outside counsel, and (ii) the Company’s general counsel, each dated as of the Closing Date, in a form reasonably acceptable to the Investor and its counsel.

(iii)           The Purchased Shares shall have been approved for listing on the Principal Market.

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(iv)           The Company shall have delivered to the Investor a certificate evidencing the formation and good standing of the Company and each of its Significant Subsidiaries in each such entity’s jurisdiction of formation issued by the Secretary of State (or equivalent) of such jurisdiction of formation as of a date within ten (10) days of the Closing Date.

(v)            The Company shall have delivered to the Investor a certificate evidencing the Company’s qualification as a foreign corporation and good standing issued by the Secretary of State (or comparable office) of each jurisdiction in which the Company conducts business and is required to so qualify, as of a date within ten (10)  days of the Closing Date.

(vi)           The Company shall have delivered to the Investor a certified copy of the Certificate of Incorporation as certified by the Secretary of State of the State of Delaware within ten (10) days of the Closing Date.

(vii)          The Company shall have delivered to the Investor a certificate, executed by the Secretary of the Company and dated as of the Closing Date, as to (A) the resolutions consistent with Section 3(b) as adopted by the Board of Directors, in a form reasonably acceptable to the Investor, (B) the Certificate of Incorporation and (C) the Bylaws, each as in effect at the Closing, in the form attached hereto as Exhibit D .

(viii)         The representations and warranties of the Company shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as of the Closing Date (except for representations and warranties that speak as of a specific date, which shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct in all respects) as of such specified date).  The Investor shall have received a certificate, executed by the Chief Executive Officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Investor in the form attached hereto as Exhibit E .

(ix)            The Company shall have delivered to the Investor a letter from the Company’s transfer agent certifying the number of shares of Common Stock outstanding as of a date within five (5) days of the Closing Date.

(x)             The Common Stock (A) shall be designated for quotation or listed on the Principal Market and (B) shall not have been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the Principal Market have been threatened, as of the Closing Date, either (x) in writing by the SEC or the Principal Market or (y) by falling below the minimum listing maintenance requirements of the Principal Market.

(xi)            The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the Purchased Shares.

(xii)           The Board of Directors shall have taken all actions necessary and appropriate to cause the Board Representative to be appointed to the Board of Directors and to

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each committee of the Board of Directors, and the Board Representative shall have been so elected and appointed concurrently with the Closing.

(xiii)          The Company shall have delivered an indemnification agreement in the form of Exhibit C , duly executed by the Company, which indemnification agreement shall become effective upon the Board Representative becoming a member of the Board of Directors.

(xiv)         The Company shall have delivered to the Investor such other documents relating to the transactions contemplated by this Agreement as the Investor or its counsel may reasonably request.

7.              TERMINATION .

(a)            Termination .  This Agreement may be terminated prior to the Closing by mutual written agreement of the Company and the Investor.

(b)            Effects of Termination .  In the event of any termination of this Agreement as provided in Section 7(a) , this Agreement (other than this Section 7(b) and Section 8 , which shall remain in full force and effect) shall forthwith become wholly void and of no further force and effect; provided , that nothing herein shall relieve any party from liability for intentional breach of this Agreement or fraud.

8.              MISCELLANEOUS .

(a)            Definitions .

“ 8-K Filing ” has the meaning set forth in Section 4(i) .

“ 1933 Act ” has the meaning set forth in the preamble.

“ 1934 Act ” has the meaning set forth in Section 3 .

“ Affiliate ” means any Person controlling, controlled by or under common control with any other Person.  For purposes of this definition, “control” (including “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of securities, partnership or other ownership interests, by contract or otherwise.

“ Agreement ” has the meaning set forth in the preamble.

“ Article Thirteenth ” means Article Thirteenth of the Certificate of Incorporation.

“ Benefit Plan ” means any employee welfare benefit plan within the meaning of Section 3(1) of ERISA, any employee pension benefit plan within the meaning of Section 3(2) of ERISA and any bonus, incentive, deferred compensation, vacation, stock purchase, stock option, severance, employment, change of control, consulting or fringe benefit plan, program, agreement or policy.

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“ Board of Directors ” has the meaning set forth in Section 3(b) .

“ Board Representative ” has the meaning set forth in Section 4(m)(i)(A) .

“ Business Day ” has the meaning set forth in Section 4(d)(i) .

“ Bylaws ” has the meaning set forth in Section 3(p) .

“ Certificate of Incorporation ” has the meaning set forth in Section 3(p) .

“ Change of Control ” has the meaning set forth in Section 4(o ).

“ Closing ” has the meaning set forth in Section 1(b) .

“ Closing Date ” has the meaning set forth in Section 1(b) .

“ Code ” means the Internal Revenue Code of 1986, as amended.

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

“ Common Stock Equivalents ” has the meaning set forth in Section 4(l) .

“ Company ” has the meaning set forth in the preamble.

“ Company Controlled Affiliates ” has the meaning set forth in Section 4(o)(i) .

“ Confidentiality Agreement ” shall mean that certain Confidentiality Agreement by and among the Investor and its management company, Sagard Capital Partners Management Corporation, and the Company, dated as of October 6, 2009.

“ Contingent Obligation ” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto.

“ Convertible Securities ” has the meaning set forth in Section 4(l) .

“ Designated Period ” means the period from and after the Closing Date until the first Business Day on which the Investor (and/or its Affiliates) cease(s) to beneficially own, in the aggregate, at least 900,000 shares of Common Stock (adjusted to take into account any stock splits, reverse stock splits, stock dividends, recapitalizations, conversions and the like).

“ Disclosure Letter ” has the meaning set forth in Section 3 .

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“ Eligible Market ” means the NYSE Amex, The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).

“ Employee Pension Benefit Plan ” has the meaning set forth in ERISA §3(2).

“ Environmental Laws ” has the meaning set forth in Section 3(x) .

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ ERISA Affiliate ” means each entity that is treated as a single employer with the Company for purposes of Code §414.

“ Fully-Diluted Basis ” means, in the case of any calculation of the number of shares of Common Stock deemed outstanding, that effect is first given to (i) all shares of Common Stock outstanding at the time of determination, (ii) all shares of Common Stock issuable upon the exercise of any in-the-money or at-the-money option, warrant or other right outstanding at the time of determination and (iii) all shares of Common Stock issuable upon the exercise of any in-the-money or at-the-money conversion or exchange right contained in any security outstanding at the time of determination that is convertible into or exchangeable for shares of Common Stock.

“ Governmental Entity ” means any federal, state, local or foreign, court, governmental, legislative, judicial, administrative or regulatory authority, agency, commission, body or other governmental entity or self regulatory organization or stock exchange.

“ Hazardous Materials ” has the meaning set forth in Section 3(x) .

“ Indebtedness ” of any Person means, without duplication (i) all indebtedness (including principal, interest, fees and charges) for borrowed money, (ii) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (including, without limitation, “capital leases” in accordance with generally accepted accounting principles) (other than trade payables entered into in the ordinary course of business), (iii) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property), (vi) all monetary obligations under any leasing or similar arrangement which, in connection with generally accepted accounting principles, consistently applied for the periods covered thereby, is classified as a capital lease, (vii) all indebtedness referred to in clauses (i) through (vi) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not

36

assumed or become liable for the payment of such indebtedness, and (viii) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (i) through (vii) above.

“ Insolvent ” means, with respect to any Person (i) the present fair saleable value of such Person’s assets is less than the amount required to pay such Person’s total Indebtedness, (ii) such Person is unable to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured, (iii) such Person intends to incur or believes that it will incur debts that would be beyond its ability to pay as such debts mature or (iv) such Person has unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted.

“ Intellectual Property Rights ” has the meaning set forth in Section 3(w) .

“ Investor ” has the meaning set forth in the preamble.

“ Investor Controlled Entity ” has the meaning set forth in Section 4(o) .

“ Knowledge of the Company ” or phrases of similar effect, means the knowledge, after reasonable investigation, of the individuals listed on Schedule 8(a) attached hereto.

“ Law ” means any statute, ordinance, license, rule, regulation, policy or guideline, order, demand, writ, injunction, decree or judgment of any Governmental Entity, including, without limitation, any of the foregoing which relate to government contracts, national security, and protection of classified information.

“ Material Adverse Effect ” means any material adverse effect on the business, properties, assets, operations, results of operations or condition (financial or otherwise) of the Company and/or its Subsidiaries, taken as a whole, or on the transactions contemplated hereby or by the other Transaction Documents or by the other agreements and instruments to be entered into in connection herewith or therewith, or on the authority or ability of the Company to perform its obligations under the Transaction Documents (as defined below), but shall not include facts, circumstances, events or changes: (i) generally affecting any of the industries in which the Company and its Subsidiaries operate; (ii) any conditions in or changes affecting the United States general economy or the general economy in any geographic area in which the Company or its Subsidiaries operate or developments in the financial and securities markets in the United States or elsewhere in the world; (iii) political conditions, including acts of war (whether or not declared), armed hostilities and terrorism, or developments or changes therein; (iv) any conditions resulting from natural disasters; (iv) resulting from changes in applicable legal requirements or Generally Accepted Accounting Principles or accounting standards; (vi) resulting from changes in the market price or the trading volume in the Common Stock in and of itself (it being understood that the underlying circumstances, event or reasons giving rise to any such changes (to the extent provided for in this definition) can be taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur); or (vii) resulting from a failure to meet securities analysts’ published revenue or earnings predictions for the Company in and of itself (it being understood that the underlying circumstances, event or reasons giving rise to any such failure (to the extent provided for in this

37

definition) can be taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur); provided , however , that the facts, circumstances, events or changes set forth in clauses (i) , (ii) , (iii) and (v) above may be taken into account in determining whether there is or has been a Material Adverse Effect if and only to the extent such act, development, occurrence, circumstance, event or change has a disproportionate impact on the Company and/or its Subsidiaries, relative to the other participants in the industries in which the Company and/or its Subsidiaries operate.

“ Material Contract ” and “ Material Contracts ” have the respective meanings set forth in Section 3(q) .

“ Multiemployer Plan ” has the meaning set forth in ERISA §3(37).

“ Notice of Acceptance ” has the meaning set forth in Section 4(l) .

“ Observer ” has the meaning set forth in Section 4(n) .

“ Offer ” has the meaning set forth in Section 4(l) .

“ Offer Notice ” has the meaning set forth in Section 4(l) .

“ Offer Period ” has the meaning set forth in Section 4(l) .

“ Offered Securities ” has the meaning set forth in Section 4(l) .

“ Options ” has the meaning set forth in Section 4(l) .

“ Person ” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof.

“ Plan ” and “ Plans ” has the meaning set forth in Section 3(v) .

“ Principal Market ” has the meaning set forth in Section 3(d) .

“ Pro Rata Percentage ” has the meaning set forth in Section 4(l) .

“ Purchase Price ” has the meaning set forth in Section 1(c) .

“ Purchased Shares ” has the meaning set forth in the preamble.

“ Refused Securities ” has the meaning set forth in Section 4(l) .

“ Registration Rights Agreement ” has the meaning set forth in the preamble.

“ Regular Preemptive Period ” has the meaning set forth in Section 4(l) .

“ Regular Preemptive Right ” has the meaning set forth in Section 4(l) .

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“ Regular Termination Event ” has the meaning set forth in Section 4(l) .

“ Regulation D ” has the meaning set forth in the preamble.

“ Reporting Period ” has the meaning set forth in Section 4(b) .

“ Rule 144 ” has the meaning set forth in Section 2(g)(i) .

“ SEC ” has the meaning set forth in the preamble.

“ SEC Documents ” has the meaning set forth in Section 3(i)(i) .

“ SEC Reports ” has the meaning set forth in Section 3 .

“ Significant Subsidiaries ” means General Physics Corporation, a Delaware corporation, and General Physics (UK) Ltd, a United Kingdom limited company.

“ Special Preemptive Period ” has the meaning set forth in Section 4(l) .

“ Special Preemptive Right ” has the meaning set forth in Section 4(l) .

“ Special Termination Event ” has the meaning set forth in Section 4(l) .

“ Subsequent Placement ” has the meaning set forth in Section 4(l) .

“ Subsequent Placement Agreement ” has the meaning set forth in Section 4(l) .

“ Subsidiaries ” means any joint venture or any entity in which the Company, directly or indirectly, owns capital stock or holds an equity or similar interest.

“ Transaction Documents ” has the meaning set forth in Section 3(b) .

“ Volume-Weighted Average Price ” means the per share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page “GPX <equity> VWAP <go>” (or its equivalent successor if such page is not available) in respect of the period from scheduled open of trading until the scheduled close of trading of the primary trading session on the Business Day immediately prior to the Closing Date (or if such volume-weighted average price is unavailable, the market value of one share of the Common Stock on the Business Day immediately prior to Closing Date determined, using a volume-weighted average method, by a nationally recognized independent investment banking firm retained for this purpose by the Company). The Volume-Weighted Average Price will be determined without regard to after hours trading or any other trading outside of the regular trading session trading hours.

(b)            Governing Law; Jurisdiction; Jury Trial .  All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal Laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the Laws of any jurisdictions other than the State of New York.  Each

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party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by Law.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

(c)            Counterparts .  This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided , that a facsimile or electronic ( i.e. , “PDF”) signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original.

(d)            Headings .  The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.

(e)            Severability .  If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.

(f)             Entire Agreement; Amendments .  This Agreement and the other Transaction Documents supersede all other prior oral or written agreements between the Investor, the Company, their Affiliates and Persons acting on their behalf with respect to the matters discussed herein, and this Agreement, the other Transaction Documents and the instruments referenced herein and therein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Investor makes any representation, warranty, covenant or undertaking with respect to such matters.  No provision of this Agreement may be amended other than by an instrument in writing signed by the Company and Sagard Capital Partners, L.P. (or any single assignee thereof).  No provision hereof may be waived other than by an instrument in writing signed by the party against whom enforcement is sought.

(g)            Notices .  Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered:  (i) upon receipt, when delivered personally; (ii) upon receipt, when sent

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by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) Business Day after deposit with an overnight courier service, in each case properly addressed to the party to receive the same.  The addresses and facsimile numbers for such communications shall be:

If to the Company:

with a copy (for informational purposes only) to:

with a copy (for informational purposes only) to:

or to such other address and/or facsimile number and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party pursuant to this Section.  Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by an overnight courier service shall be rebuttable

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evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with clause (i) , (ii) or (iii) above, respectively.

(h)            Successors and Assigns .  This Agreement shall be binding upon and inure to the benefit of the parties and their respective permitted successors and assigns.  Neither party shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other party, including by way of merger, consolidation or otherwise.  Notwithstanding the foregoing, the Investor may assign some or all of its rights hereunder to any of its Affiliates in connection with transfer (including by merger, consolidation or otherwise) of any of the Purchased Shares to such Affiliate without the consent of the Company, in which event such Affiliate-assignee shall be deemed to be the Investor hereunder with respect to such assigned rights; provided, that the Investor shall nonetheless remain responsible for all of its obligations hereunder.

(i)             No Third Party Beneficiaries .  This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

(j)             Survival .  The representations and warranties in this agreement shall expire at the Closing and have no further force or effect; provided , that (i) the representations and warranties in Sections 3(a) through 3(g) shall survive until the first anniversary of the Closing and (ii) the representations and warranties in Section 3(h) shall survive without limitation.  The Investor may not first bring a claim in respect of a representation or warranty after such representation and warranty has expired or ceased to survive.  All statements of the parties hereto as to factual matters contained any certificate or exhibit delivered by or on behalf of such party pursuant to this Agreement shall be deemed to be representations and warranties of such party hereunder as of the date of such certificate or exhibit.  The agreements and covenants set forth in Sections 4 and 8 shall survive the Closing and the delivery and exercise of Purchased Shares, as applicable, in accordance with their terms.  At such time that the Investor (or the Investor’s Affiliates) no longer beneficially owns any of the Purchased Shares, any remaining surviving provisions of this Agreement shall terminate, other than Sections 4(f) , 4(m)(vi) and this Section 8 .  Nothing contained in this Section 8(j) shall be deemed to limit any rights of the Investor under applicable federal and state securities laws.

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

(l)             No Strict Construction .  The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.

(m)           Remedies .  The Investor shall have all rights and remedies set forth in the Transaction Documents and all rights and remedies which it has been granted at any time under any other agreement or contract and all of the rights which such holders have under any Law. 

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The Investor shall be entitled to enforce such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights granted by Law.  Furthermore, the Company recognizes that in the event that it fails to perform, observe, or discharge any or all of its obligations under the Transaction Documents, any remedy at Law may prove to be inadequate relief to the Investor.  The Company therefore agrees that the Investor shall be entitled to seek temporary and permanent injunctive relief in any such case without the necessity of proving actual damages and without posting a bond or other security.  Notwithstanding anything to the contrary contained herein, the Investor shall not be entitled to consequential, indirect or incidental damages hereunder.  However, the foregoing shall not in any way limit the Investor from being reimbursed for its costs, fees or expenses, including, without limitation, reasonable attorneys’ fees and disbursements in connection with any of its rights and remedies hereunder.

(n)            Acknowledgment Regarding Investor’s Purchased Shares .  The Company acknowledges and agrees that the Investor is acting solely in the capacity of arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby.  The Company further acknowledges that the Investor is not acting as a financial advisor or fiduciary of the Company or any of its Subsidiaries (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and any advice given by the Investor or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to the Investor’s purchase of the Purchased Shares.  The Company further represents to the Investor that the Company’s decision to enter into the Transaction Documents has been based solely on the independent evaluation by the Company and its representatives.

[Signature Page Follows]

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IN WITNESS WHEREOF, the Investor and the Company have caused their respective signature page to this Securities Purchase Agreement to be duly executed as of the date first written above.

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

by and among

GP STRATEGIES CORPORATION

and

SAGARD CAPITAL PARTNERS, L.P.

Dated as of December 30, 2009

TABLE OF CONTENTS

i

ii

REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT (this “ Agreement ”), dated as of December 30, 2009, is by and among GP Strategies Corporation, a Delaware corporation (the “ Company ”), and the undersigned Purchaser (the “ Purchaser ”).

RECITALS

In connection with, and pursuant to, that certain Securities Purchase Agreement by and among the parties hereto of even date herewith (the “ Securities Purchase Agreement ”), the Company has agreed, upon the terms and subject to the conditions of the Securities Purchase Agreement, to issue and sell to the Purchaser at the Closing 2,857,143 shares (the “ Purchased Shares ”) of Common Stock, par value $0.01 per share (the “ Common Stock ”), of the Company.  Capitalized terms used and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement.

To induce the Purchaser to execute, deliver and perform the Securities Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “ Securities Act ”), and applicable state securities laws.

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Investors (as defined below) hereby agree as follows:

1.                                        DEFINITIONS .  In addition to the capitalized terms elsewhere defined herein, the following terms, when used herein, shall have the following meanings, unless the context otherwise requires:

“ Agreement ” has the meaning set forth in the preface above.

“ Assignment Period ” has the meaning set forth in Section 5(c) .

“ Black Out Period ” has the meaning set forth in Section 5(a)(i)(B) .

“ Business Day ” means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in New York, New York generally are authorized or required by law or other governmental actions to close.

“ Claims ” has the meaning set forth in Section 7(a) .

“ Common Stock ” has the meaning set forth in the recitals above.

“ Company ” has the meaning set forth in the preface above.

“ Effective Date ” means the date a Registration Statement is declared or becomes effective under the Securities Act.

“ Effectiveness Deadline ” has the meaning set forth in Section 2(a) .

“ Exchange Act ” has the meaning set forth in Section 3(b) .

“ Filing Deadline ” has the meaning set forth in Section 2(a) .

“ Holdback Period ” has the meaning set forth in Section 5(b) .

“ Investor Representative ” means Sagard Capital Partners, L.P.

“ Investors ” means (i) the Purchaser, (ii) any transferee or assignee thereof to whom the Purchaser or an Investor assigns its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance with Section 9(c) , and (iii) any transferee or assignee thereof to whom a transferee or assignee assigns its rights under this Agreement and who agrees to become bound by the provisions of this Agreement in accordance with Section 9(c) .

“ Legal Counsel ” has the meaning set forth in Section 2(f) .

“ Liquidated Damages ” has the meaning set forth in Section 5(c) .

“ Notice and Questionnaire ” means the selling securityholder questionnaire attached to the Notice of Registration and Selling Securityholder Questionnaire attached as Exhibit B hereto.

“ Person ” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, other entity, an unincorporated organization and a governmental or any department or agency thereof.

“ Purchased Shares ” has the meaning set forth in the recitals above.

“ Purchaser ” has the meaning set forth in the preface above.

“ Records ” has the meaning set forth in Section 3(q)(ii) .

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

“ Registrable Securities ” means (i) all Purchased Shares, (ii) all shares of Common Stock issued pursuant to Section 4(l) of the Securities Purchase Agreement (including shares of Common Stock issuable upon exercise, conversion or exchange of securities issued pursuant to such Section 4(l)) and (iii) any shares of capital stock issued or issuable with respect to the Purchased Shares or any of the shares described in clause (ii), in either case as a result of any stock split, stock dividend, recapitalization, exchange or similar event or otherwise; provided , however , that Registrable Securities shall not include any such shares (A) which have been disposed of pursuant to an effective registration statement under the Securities Act, (B) which

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have been sold or otherwise transferred in a transaction in which the rights under the provisions of this Agreement have not been assigned, (C) which have been sold under Rule 144 or (D) which are owned by an Investor with respect to which this Agreement has terminated pursuant to Section 9(p)  hereof.

“ Registrable Securities Purchase Price ” means, with respect to any Registrable Security, the purchase price actually paid by Sagard Capital Partners, L.P. for such Registrable Security (or, if such Registrable Security was acquired upon exercise or conversion of other equity securities, the exercise price or conversion price thereof), in all cases subject to adjustment for any stock split, dividend, spin-off or combination, or any reclassification, recapitalization, merger, consolidation, exchange or other similar reorganization or business combination.

“ Registration Default ” has the meaning set forth in Section 5(c) .

“ Registration Period ” has the meaning set forth in Section 3(a) .

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

“ Rule 144 ” means Rule 144 promulgated by the SEC under the Securities Act.

“ Scheduled Earnings Blackouts ” has the meaning set forth in Section 5(a)(i)(B) .

“ SEC ” means the United States Securities and Exchange Commission.

“ Securities Act ” has the meaning set forth in the recitals above.

“ Securities Purchase Agreement ” has the meaning set forth in the recitals above.

“ Subsequent Registration Rights ” has the meaning set forth in Section 9(a)(ii) .

“ Suspension Notice ” has the meaning set forth in Section 5(a)(i) .

“ Underwritten Offering ” means an offering registered under the Securities Act in which securities of the Company are sold to an underwriter or underwriters for reoffering to the public.

2.                                        REGISTRATION .

(a)                                   Mandatory Registration .  The Company shall prepare and file with the SEC a Registration Statement on Form S-3 covering the resale of all of the Registrable Securities. The Company shall file the Registration Statement no later than ninety (90) days prior to the first anniversary of the Closing.  Such deadline is referred to herein as the “ Filing Deadline .”  If Form S-3 is unavailable for such a registration, the Company shall use such other form as is available for such a registration, subject to the provisions of Section 2(b) .  The Registration Statement prepared pursuant hereto shall register for resale at least that number of shares of Common Stock equal to the aggregate number of Registrable Securities issued and outstanding as of the trading day immediately preceding the date the Registration Statement is initially filed with the SEC, subject to adjustment as provided in Section 2(d) .  The Company shall use its reasonable best

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efforts to have the Registration Statement declared effective by the SEC no later than the first anniversary of the Closing (the “ Effectiveness Deadline ”).

(b)                                  Ineligibility for Form S-3 .  If Form S-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable Securities on another appropriate form reasonably acceptable to the Investor Representative and (ii) undertake to register the Registrable Securities on Form S-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Registration Statement then in effect until such time as a Registration Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC.

(c)                                   Sufficient Number of Shares Registered .  If the number of shares available under the Registration Statement filed pursuant to Section 2(a)  is, or becomes, insufficient to cover all of the Registrable Securities required to be covered by the Registration Statement, the Company shall amend the Registration Statement, or file a new Registration Statement (on the short form available therefor, if applicable), or both, so as to cover at least 100% of the aggregate number of the Registrable Securities required to be registered hereunder as of the trading day immediately preceding the date of the filing of such amendment or new Registration Statement, in each case, as soon as practicable, but in any event not later than fifteen (15) days after the necessity therefor arises.  The Company shall use its reasonable best efforts to cause such amendment and/or new Registration Statement to become effective as soon as practicable following the filing thereof.  For all purposes of this Agreement, such additional Registration Statement shall be deemed to be the Registration Statement required to be filed by the Company pursuant to Section 2(a)  of this Agreement, and the Company and the Investors shall have the same rights and obligations with respect to such additional Registration Statement as they shall have with respect to the initial Registration Statement required to be filed by the Company pursuant to Section 2(a) .

(d)                                  Underwritten Offering .  If, at any time and from time to time, the Investor Representative wishes to effect an Underwritten Offering of any Registrable Securities:

(i)                                      the Investor Representative shall have the right to select the managing/book-running underwriter(s), if any, for the Registrable Securities to be registered pursuant to Section 2(a) , subject to the Company’s written approval of such managing/book-running underwriter(s), such written approval not to be unreasonably withheld, conditioned or delayed;

(ii)                                   if a representative of the managing/book-running underwriter(s) advises the Investors and the Company in writing that marketing factors require a limitation of the number of securities to be underwritten (including Registrable Securities) because the number of securities to be underwritten is likely to have an adverse effect on the price, timing or the distribution of securities to be offered, then the number of securities that may be included in the underwriting shall be allocated, first , to the Investors, allocated among the Investors on a pro rata basis based on the total number of Registrable Securities held by the Investors and second , only if the Investors are able to have all of the Registrable Securities included that they seek to have included, to the Company and other holders of registration rights to the extent they are participating in such offering.  For the avoidance of doubt, any Registrable Securities or other

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securities excluded or withdrawn from such underwriting shall continue to be covered by the shelf Registration Statement;

(iii)           if there is, at such time, an effective shelf Registration Statement in respect of the Registrable Securities, the Company shall promptly amend or supplement the shelf Registration Statement if and as may be necessary in order to enable such Registrable Securities to be distributed pursuant to an Underwritten Offering, but in any event no later than thirty (30) days after the request from the Investor Representative, and shall use its reasonable best efforts to cause such amendment to become effective as soon as practicable after such filing, but in any event no later than ninety (90) days after the request from the Investor Representative;

(iv)                               if there is, at such time, no effective shelf Registration Statement in effect in respect of the Registrable Securities, the Company shall:

(A)                               cause to be prepared and to file a Registration Statement as promptly as reasonably practicable after the request from the Investor Representative, but in any event no later than thirty (30) days thereafter;

(B)                                 use reasonable best efforts to cause such Registration Statement to become effective as soon as practicable after filing, but in any event no later than ninety (90) days after the request from the Investor Representative;

(C)                                 use reasonable best efforts to maintain in effect, supplement and amend, if necessary, the Registration Statement, as required by the instructions applicable to such registration form or by the Securities Act for the period required to consummate the Underwritten Offering;

(D)                                furnish, upon request, to the holders of the Registrable Securities to which the Registration Statement relates copies of any supplement or amendment to such Registration Statement prior to such supplement or amendment being used and/or filed with the SEC; and

(E)                                  pay all Registration Expenses in connection with the Registration Statement, whether or not it becomes effective, and whether all, some or none of the Registrable Securities to which it relates are sold pursuant to it.

The Investor Representative shall not be entitled to require more than one (1) Underwritten Offering in any 12-month period (counting only those Underwritten Offerings which have been consummated ( i.e. , the registration statement for the underwriting has been declared effective and the securities registered thereunder have actually been sold) in any such 12-month period).  Furthermore, notwithstanding the foregoing, nothing in this Section 2(d)  shall obligate the Company to file a Registration Statement prior to the Filing Deadline or to cause a Registration Statement for an Underwritten Offering to become effective prior to the Effective Date.

Notwithstanding anything contained herein to the contrary, no Investor may participate in any Underwritten Offering pursuant to a registration hereunder unless that Investor (i) agrees to sell its Registrable Securities on the basis provided in any underwriting arrangements approved

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by the Investor Representative and (ii) completes and executes all questionnaires (including customary signed questionnaires for due diligence purposes in connection with any filing with the Financial Industry Regulatory Authority, Inc.), powers of attorney, indemnities (but only in the same manner and to the same extent as set forth in Section 7(b) ), underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements.

(e)                                   Plan of Distribution .  The intended method or methods of disposition and/or sale (Plan of Distribution) of the Registrable Securities contained in the Registration Statement to be filed hereunder shall be in the form attached hereto as Exhibit A , with only such modifications and changes as expressly agreed by the Company and the Investor Representative.

(f)                                     Legal Counsel .  Subject to Section 6 hereof, the Investor Representative shall have the right to select one legal counsel in connection with any offering pursuant to this Section 2 (“ Legal Counsel ”), which shall be Finn Dixon & Herling LLP or such other counsel as hereafter designated by the Investor Representative.  The Company shall reasonably cooperate with Legal Counsel in performing the Company’s obligations under this Agreement.

3.                                        RELATED OBLIGATIONS .  At such time as the Company is obligated to file a Registration Statement with the SEC pursuant to Section 2 or Section 3(p) , the Company will use its reasonable best efforts to effect the registration of the Registrable Securities covered by such Registration Statement in accordance with the intended method of disposition thereof and the Company shall have the following additional obligations:

(a)                                   The Company shall use its reasonable best efforts to keep the Registration Statement effective pursuant to Rule 415 at all times from the Effective Date until the date on which the Investors shall have sold all the Registrable Securities covered by such Registration Statement (the “ Registration Period ”), which Registration Statement (including any amendments or supplements thereto and prospectuses contained therein), at the time it is first filed with the SEC, at the time it is ordered effective by the SEC and at all times during which it is required to be effective hereunder (and each such amendment and supplement at the time it is filed with the SEC and at all times during which it is available for use in connection with the offer and sale of the Registrable Securities) shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.  If the Registration Statement is no longer effective during the Registration Period, the Company shall use its reasonable best efforts to cause a new Registration Statement to become effective pursuant to Section 2 or Section 3(p)  as promptly as practicable.

(b)                                  The Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective at all times during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement.  In the case

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of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 3(b) ) by reason of the Company filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous report under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), the Company shall have incorporated such report by reference into the Registration Statement, if applicable, or shall file such amendments or supplements with the SEC on the same day on which the Exchange Act report is filed which created the requirement for the Company to amend or supplement the Registration Statement.

(c)                                   The Company shall permit Legal Counsel to review and comment upon (i) any Registration Statement prior to its filing with the SEC and (ii) all other Registration Statements and all amendments and supplements to all Registration Statements (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and any similar or successor reports) prior to their filing with the SEC.  The Company shall not submit a request for acceleration of the effectiveness of a Registration Statement or any amendment or supplement thereto without the prior approval of Legal Counsel, which consent shall not be withheld unless Legal Counsel has reasonable objections to disclosures in the Registration Statement relating to the Investors.  The Company shall furnish to Legal Counsel, without charge, (i) any correspondence from the SEC or the staff of the SEC to the Company or its representatives relating to any Registration Statement, (ii) promptly after the same is prepared and filed with the SEC, one copy of any Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits and (iii) upon the effectiveness of any Registration Statement, one copy of the prospectus included in such Registration Statement and all amendments and supplements thereto.

(d)                                  The Company shall furnish, without charge, to each Investor selling Registrable Securities and each underwriter, if any, such number of copies of such Registration Statement, each amendment and supplement thereto (in each case including all exhibits), the prospectus included in such Registration Statement (including each preliminary prospectus and any summary prospectus) and any other prospectus filed under Rule 424 under the Securities Act, and each free writing prospectus utilized in connection therewith, in each case, in conformity with the requirements of the Securities Act, and other documents, as such Investor or underwriter may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities owned by such Investor.

(e)                                   The Company shall use its reasonable best efforts to cause such Registrable Securities to be registered with or approved by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities pursuant to a 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(e) , (ii) subject itself to general taxation in any such jurisdiction, or (iii) file a general consent to service of process in any such jurisdiction.

(f)                                     The Company shall notify Legal Counsel and each Investor in writing of the happening of any event, as promptly as practicable after becoming aware of such event, as a result of which the prospectus included in a Registration Statement, as then in effect, includes an

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untrue statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (provided that in no event shall such notice contain any material, nonpublic information), and promptly prepare a supplement or amendment to such Registration Statement to correct such untrue statement or omission, and deliver such number of copies of such supplement or amendment to Legal Counsel and each Investor as Legal Counsel or such Investor may reasonably request.  The Company shall also promptly notify Legal Counsel and each Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to Legal Counsel and each Investor by email on the same day of such effectiveness and by overnight delivery), (ii) of any request by the SEC for amendments or supplements to a Registration Statement or related prospectus or related information, and (iii) of the Company’s reasonable determination that a post-effective amendment to a Registration Statement would be appropriate.

(g)            The Company shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension promptly and to notify Legal Counsel and each Investor who holds Registrable Securities being sold of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

(h)            The Company shall cooperate with the Investors who hold Registrable Securities being offered and facilitate the timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to a Registration Statement and enable such certificates to be in such denominations or amounts, as the case may be, as the Investors may reasonably request and registered in such names as the Investors may request.

(i)             The Company shall appoint (if one has not already been appointed) and maintain a transfer agent and registrar for its Common Stock not later than the Effective Date.  The Company shall use reasonable best efforts to procure the cooperation of the Company’s transfer agent in settling any offering or sale of Registrable Securities, including with respect to the transfer of physical stock certificates into book-entry form in accordance with any procedures reasonably requested by any Investor.

(j)             The Company shall otherwise use its reasonable best efforts to comply (and continue to comply) with all applicable rules and regulations of the SEC (including, without limitation, maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) in accordance with the Exchange Act);

(k)            Within one (1) Business Day after a Registration Statement which covers Registrable Securities is ordered effective by the SEC, the Company shall deliver or shall cause legal counsel for the Company to deliver to the Company’s transfer agent confirmation that such Registration Statement has been declared effective by the SEC.

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(l)             The Company shall use commercially reasonable efforts to take all other actions reasonably necessary to expedite and facilitate disposition by Investors of Registrable Securities pursuant to a Registration Statement.

(m)           In the event of any underwritten public offering (at the election of the Investors, as described in Section 2 ), the Company shall:

(i)             enter into such customary agreements, including a customary underwriting agreement, in each case in form and substance reasonably satisfactory to the Company, which may include indemnification provisions in favor of underwriters and other Persons in addition to, or in substitution for the provisions hereof, and shall use reasonable best efforts to take such other actions as the Investors or the underwriters may reasonably request in order to expedite or facilitate the disposition of such Registrable Securities;

(ii)            obtain one or more comfort letters, dated such date or dates as are customary for the Company in the context of an Underwritten Offering by the Company, addressed to any underwriters of the Underwritten Offering, signed by the Company’s independent public accountants, in form and covering such matters of the type customarily covered by comfort letters delivered by the Company in connection with underwritten company offerings as the lead underwriters may reasonably request;

(iii)           make available for inspection by the Investors, by any underwriter participating in any disposition to be effected pursuant to an Underwritten Offering and by any attorney, accountant or other agent retained by the Investors or any such underwriter, all pertinent financial and other records, pertinent corporate documents and properties of the Company, and cause all of the Company’s officers, directors and employees to supply all information reasonably requested by the Investors or any such underwriter, attorney, accountant or agent in connection with such Underwritten Offering;

(iv)           if reasonably requested by the managing underwriter or agent or the Investors, promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriter or agent or the Investors reasonably request to be included therein, including, with respect to the number of Registrable Securities being sold by the Investors to such underwriter or agent, the purchase price being paid therefor by such underwriter or agent and with respect to any other terms of the Underwritten Offering and make all required filings of such prospectus supplement or post-effective amendment as soon as reasonably practicable after being notified of the matters incorporated in such prospectus supplement or post-effective amendment;

(v)            obtain for delivery to the underwriter or agent an opinion or opinions from counsel for the Company in customary form, substance and scope reasonably satisfactory to such underwriters or agents and their counsel; and

(vi)           use its commercially reasonable efforts to make available the executive officers of the Company to participate with the Investors and/or any underwriters in any customary “road shows” or other selling efforts that may be reasonably requested by the Investors, on the one hand, or managing underwriters, on the other hand, in connection with an

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Underwritten Offering; provided , that, after the Company has consummated two (2) Underwritten Offerings requested by the Investor pursuant to this Agreement, this clause (vi)  shall only apply to those Underwritten Offerings that, based on the good faith determination of the Investors in consultation with the managing underwriter, are expected to result in gross proceeds of at least $10.0 million.

(n)            The Company shall use its reasonable best efforts to secure the listing of all of the Registrable Securities covered by such Registration Statement upon each national securities exchange and automated quotation system, if any, upon which shares of Common Stock shall be so listed and shall maintain, so long as any other shares of Common Stock shall be so listed, such listing of such Registrable Securities.

(o)            During the period that the Company is required to maintain effectiveness of the Registration Statement pursuant to Section 3(a) , the Company shall not bid for or purchase any Common Stock or any right to purchase Common Stock or attempt to induce any person to purchase any such security or right if such bid, purchase or attempt would in any way limit the right of the Investors to sell Registrable Securities by reason of the limitations set forth in Regulation M under the Exchange Act.

(p)            If a Registration Statement covering the Registrable Securities will terminate by its terms, the Company shall, as far in advance as is practicable, refile (or file and have declared effective) a new Registration Statement and use its reasonable best efforts to minimize and gap between the two Registration Statements.

(q)            To the extent that any of the Investors is deemed to be an underwriter of Registrable Securities pursuant to any SEC comments or policies, the Company agrees that:

(i)             The indemnification and contribution provisions contained in Section 7 shall be applicable to the benefit of the Investors in their role as deemed underwriter in addition to their capacity as holders of Registrable Securities;

(ii)            The Investors shall be entitled to conduct the due diligence which they would normally conduct in connection with an offering of securities registered under the Securities Act, including without limitation receipt of customary opinions and comfort letters; provided , however , that each Investor shall agree to hold in strict confidence and shall not make any disclosure or use of any record or other information (“ Records ”) which the Company determines in good faith to be confidential, and of which determination the Investors are so notified, unless (A) the disclosure of such Records is required by law or (B) the information in such Records has been made generally available to the public other than by disclosure in violation of this Agreement;

(iii)           The Company shall obtain opinions of counsel to the Company (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory to the Investor Representative) in customary form addressed to the Investors, covering such matters as are customarily covered in opinions requested in underwritten offerings and dated as of the date such opinion is customarily dated;

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(iv)           The Company shall obtain “comfort letters” and updates thereof from the independent public accountants of the Company (and, if necessary, any other independent public accountants of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Registration Statement), addressed to the Investors, in customary form and covering matters of the type customarily covered in comfort letters in connection with primary underwritten offerings and dated as of the date such comfort letter is customarily dated; and

(v)            The Company shall deliver such other customary documents and certificates as may be reasonably requested by the Investors to evidence compliance with any customary conditions contained in underwriting agreements, if any.

4.              OBLIGATIONS OF THE INVESTORS .

(a)            At least ten (10) Business Days prior to the first anticipated filing date of a Registration Statement, the Company shall, by delivering a Notice and Questionnaire, notify each Investor in writing of the information the Company reasonably requires from each such Investor if such Investor elects to have any of such Investor’s Registrable Securities included in such Registration Statement.  It shall be a condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that such Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request, including, without limitation, a properly completed Notice and Questionnaire.

(b)            Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any Registration Statement hereunder, unless such Investor no longer holds any Registrable Securities or has notified the Company in writing of such Investor’s election to exclude all of such Investor’s Registrable Securities from such Registration Statement.

(c)            Each Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in the first sentence of Section 3(f)  or in Section 3(g)  or, such Investor will immediately discontinue disposition of Registrable Securities pursuant to any Registration Statement(s) covering such Registrable Securities until such Investor’s receipt of the copies of the supplemented or amended prospectus contemplated by the first sentence of Section 3(f)  or by Section 3(g)  or receipt of notice that no supplement or amendment is required and, if so directed by the Company, such Investor shall deliver to the Company, or destroy all copies in such Investor’s possession, any prospectus covering such Registrable Securities current at the time of receipt of such notice.  Notwithstanding anything to the contrary contained herein, if the Investor has sold any Registrable Securities prior to the Investor’s receipt of a notice from the Company of the happening of any event of the kind described in the first sentence of Section 3(f)  or in Section 3(g)  but has not yet settled such sale prior to the receipt of any such notice, the Company shall cause its transfer agent to deliver an

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unlegended certificate(s) representing the shares of Common Stock to be transferred to the applicable transferee(s) in accordance with the terms of the Securities Purchase Agreement.

5.              SUSPENSION OF REGISTRATION RIGHTS .

(a)            Suspension Notices .

(i)             Notwithstanding anything to the contrary herein, during any earnings blackout period in effect pursuant to a policy established by the Company’s Board of Directors or a designated committee thereof (including, without limitation, the Company’s current earnings blackout policy) (a “ Scheduled Earnings Blackout ”), unless the Company provides the Investors notice that a Black Out Period (as defined below) with respect to a Scheduled Earnings Blackout will not be in effect, or if the Company shall at any time furnish to the Investors a certificate signed by any of its authorized officers (a “ Suspension Notice ”) stating that:

(A)           the Company has pending or in process a material transaction, the disclosure of which would, in the good faith judgment of the Company’s Board of Directors, after consultation with its outside counsel, materially and adversely affect the Company or the prospects for consummation of such material transaction; or

(B)            the Company’s Board of Directors has made the good faith determination after consultation with counsel that (x) use or continued use of any proposed or effective Registration Statement for purposes of effecting offers or sales of Registrable Securities pursuant thereto would require, under the Securities Act, premature disclosure in such Registration Statement (or the prospectus relating thereto) of material, non-public information, (y) such premature disclosure would not be in the best interest of the Company and (z) it is therefore necessary to defer the filing or to suspend the use of such Registration Statement (and the prospectus relating thereto) for purposes of effecting offers or sales of Registrable Securities pursuant thereto,

the right of the Investors to require the Company to file any Registration Statement or, after the filing thereof, use any Registration Statement (and the prospectus relating thereto) for purposes of effecting offers or sales of Registrable Securities pursuant thereto shall be suspended for a period (a “ Black Out Period ”) of not more than 200 days in the aggregate in any 360 consecutive-day period; provided , however , that, during the period beginning on the earlier to occur of (i) the first anniversary of the date hereof, and (ii) the Effective Date of the initial Registration Statement required to be filed by the Company pursuant to Section 2(a)  (the earlier of the two dates referred to in clauses (i) and (ii), the “ Reference Date ”), and ending on the second anniversary of the Reference Date, such 200 day aggregate limit may be increased for up to two additional periods in any 12-month period, not to exceed 60 days in the aggregate in any 12 consecutive-month period, but only in the case of a Suspension Notice(s) approved by all of the members of the executive committee of the Board of Directors (other than any representative of the Investor to the extent a member thereof) delivered in respect of a material transaction described in Section 5(a)(i)(A) ; and provided , further , however , that following the second anniversary of the Reference Date, such 200 day aggregate limit may be increased (such increase in the 200 day aggregate limit pursuant to the immediately preceding proviso or this proviso, the “ Limit Increase ”) for up to two additional periods in any 12-month period, not to exceed 30 days

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in the aggregate in any 12 consecutive-month period, but only in the case of a Suspension Notice(s) approved by all of the members of the executive committee of the Board of Directors (other than any representative of the Investor to the extent a member thereof) delivered in respect of a material transaction described in Section 5(a)(i)(A) .  If the Company modifies its earnings blackout policy, or its implementation thereof, to reduce the number of days comprising Scheduled Earnings Blackouts, the 200 day aggregate limit in the preceding sentence (as may be increased pursuant to the first proviso or the second proviso in the preceding sentence) shall be reduced by a like number of days.  Furthermore, in addition to the 200 day (or such greater or lesser period, as applicable, pursuant to the Limit Increase and any decrease pursuant to the previous sentence, respectively) aggregate limit on Blackout Periods per each 360 day period, no Black Out Period shall last for more than 45 consecutive days in any 360 consecutive day period except (i) in the case of a Suspension Notice delivered, or a Scheduled Earnings Blackout designated, in respect of the Company’s year-end earnings reports, no more than 65 consecutive days after delivery of such Suspension Notice or start of such Scheduled Earnings Black Out and (ii) in the case of a Suspension Notice delivered in respect of a material transaction described in Section 5(a)(i)(A) , no more than 100 consecutive days after delivery of such Suspension Notice.  For the avoidance of doubt, with respect to any Registrable Security, no Registration Default shall be applicable to such Registrable Security during any Black Out Period permitted to be imposed on the holder of such Registrable Security pursuant to this Section 5 .

A Suspension Notice shall not disclose the specific material, non-public information with respect to any Black Out Period, unless the Investor specifically requests in writing to receive such material, non-public information and agrees in writing to keep such material, non-public information confidential.

(ii)            Notwithstanding anything to the contrary in this Section 5(a) , the Company shall not impose any Black Out Period, including any Scheduled Earnings Black Out, in a manner that is more restrictive (including, without limitation, as to duration) than the comparable restrictions that the Company may impose on transfers of the Company’s equity securities by its directors and senior executive officers.

(iii)           During any Black Out Period, no Investor shall offer or sell any Registrable Securities pursuant to or in reliance upon any Registration Statement (or the prospectus relating thereto) filed by the Company. Notwithstanding the foregoing, if the public announcement of such material, nonpublic information is made during a Black Out Period, then the Black Out Period shall terminate without any further action of the parties and the Company shall immediately notify the Investors of such termination.

(b)            Holdback Periods .  If any sale of securities in connection with a registration hereunder shall be in connection with an underwritten public offering, each of the Company and each Investor which is actually selling shares in such underwritten public offering agree and, if so requested by any underwriter in connection with such offering or sale, each director or executive officer of the Company, shall enter into a customary agreement with such underwriter agreeing not to effect any sale or distribution (subject to customary carveouts or such other exceptions as the managing underwriter may agree to), including, in the case of such selling Investors, any sale pursuant to Rule 144 under the Securities Act, of any such securities of the Company, or options or other rights convertible into, or exchangeable or exercisable for, such

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securities (other than as part of such underwritten public offering), within seven (7) days before, or ninety (90) days (or such lesser period as the managing underwriters may permit) after, the effective date of any such registration or the closing of any sale of securities in connection with a registration (except as part of any such registration or sale) (such period, a “ Holdback Period ”); provided , that, notwithstanding the foregoing, with respect to any offering by the Company as to which the Investors exercise rights under Sections 9(a)  or 9(b) , the selling Investors shall have no obligation under this Section 5(b) , and shall not be required to enter into any agreement with an underwriter pursuant to this Section 5(b) , in each case that is more restrictive than the obligations imposed on and agreements required to be entered into by the directors and senior executive officers of the Company in connection with such offering.

(c)            Delay Payments .  The Company and each Investor each agree that any such Investor will suffer damages, and it would not be feasible to ascertain the extent of such damages with precision, if the Company fails to fulfill its obligations hereunder.  Subject in all cases to Section 5 (including any applicable Blackout Period or Holdback Period imposed in accordance therewith, whether such period is pursuant to the agreement set forth in Section 5 or a separate agreement with the underwriters of any company offering or Underwritten Offering), if (i) a Registration Statement is not filed on or prior to any required date hereunder, (ii) a Registration Statement is not declared effective by the SEC or any order of a governmental authority preventing or suspending the use of any prospectus is not lifted prior to any Effective Date or Effectiveness Date applicable thereto, (iii) the Company fails to file with the SEC a request for acceleration of effectiveness in accordance with Rule 461 promulgated under the Securities Act, within five (5) Business Days after the date that (A) the Company is notified in writing by the SEC that a Registration Statement will not be “reviewed,” or is not subject to further review and (B) Legal Counsel has given its prior approval to request acceleration of effectiveness pursuant to Section 3(c) , or (iv) after the Effective Date, a Registration Statement required to be effective hereunder ceases for any reason to remain effective (without being succeeded immediately by a replacement Registration Statement filed and declared effective) or usable (excluding as a result of a post-effective amendment thereto that is required by applicable law in order to cause a permitted assignee hereunder to be named as a selling securityholder therein, provided that such post-effective amendment is filed by the Company within ten (10) Business Days after the Company receiving notice from any Investor that such post-effective amendment is required (any such ten (10) Business Day period, an “ Assignment Period ”) for the resale of Registrable Securities, or the Investors are otherwise unable to effect the resale of any Registrable Securities hereunder as a result of a breach by the Company of its obligations hereunder, in each case for such period of time (excluding the duration of any Black Out Period applicable to such Registrable Securities, any Holdback Period, or any Assignment Period) as to any Registrable Securities for which any Registration Statement is then required to be effective hereunder (each of the events referred to in clauses (i)  through (iv) , a “ Registration Default ”) the Company shall pay to any Investor holding any Registrable Securities not eligible for resale as a result of such Registration Default, for the duration of such Registration Default as it applies to such Registrable Securities held by such Investor an amount equal to one percent (1%) of the Registrable Securities Purchase Price of such Registrable Securities per thirty (30) days (or portion thereof), payable in cash on the second business day of each calendar month in respect of payments accruing through the last day of the preceding calendar month, with late payments accruing interest at a rate of eighteen percent (18%) per annum (or such lesser maximum amount that is permitted to be paid by applicable law), compounding on each payment date (the

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payments described in this Section 5(c) , the “ Liquidated Damages ”); provided , however, that the aggregate amount of Liquidated Damages payable by the Company to the Investors, for all Registration Defaults, shall not exceed $2,400,000.  Each of the Company and each Investor agree that the Liquidated Damages provided for in this Section 5 constitute a reasonable estimate of the monetary damages that may be incurred by the Investor by reason of a Registration Default and that such Liquidated Damages are the only monetary damages available to the Investors in the event of a Registration Default.  Notwithstanding anything to the contrary set forth in this Section 5 , no event shall be considered a Registration Default hereunder if such event or the primary cause thereof (i) was consented to in writing by the Investor Representative or (ii) results (and shall not be considered a Registration Default for as long as it continues to result) solely from (A) any breach or delay in performance by any Investor of any of its obligations set forth in this Agreement or (B) any delay solely caused or requested by any underwriter or underwriters in connection with an Underwritten Offering.

6.              EXPENSES OF REGISTRATION .  The Company shall bear all expenses, other than underwriting discounts and commissions, incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3 , including, without limitation, all registration, listing and qualification fees, printers and accounting fees, fees and disbursements of counsel for the Company in connection with registration, filing or qualification pursuant to Sections 2 and 3 of this Agreement, fees and disbursements of Legal Counsel (up to an aggregate of $25,000 for Legal Counsel) and reasonable fees and disbursements of underwriters and their counsel customarily paid by the issuers or sellers of securities (such as fees and expenses related to dealings with and filings with the Financial Industry Regulatory Authority, Inc. and any “blue-sky” related filings).  In addition, the Company shall be responsible for all of its internal expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses incurred in connection with the listing of the Registrable Securities on any securities exchange as required hereunder.

For the avoidance of doubt, each Investor shall pay all underwriting and placement discounts and commissions, agency and placement fees, brokers’ commissions and transfer taxes, if any, relating to the sale or disposition of such Investor’s Registrable Securities.

7.              INDEMNIFICATION .  If any Registrable Securities are included in a Registration Statement under this Agreement:

(a)            Obligations of the Company to Indemnify .  In the event of any registration of any Registrable Securities pursuant to this Agreement, the Company shall indemnify and hold harmless each Investor and its directors, officers, partners, agents, stockholders, managers, members, employees, each underwriter, if any, in the offering or sale of such securities, and each other Person, if any, who controls such Investor or any such underwriter within the meaning of the Securities Act, and the directors, officers, partners, agents, stockholders, managers, members and employees of each such controlling Person, from and against any and all losses, claims, damages or liabilities, joint or several, actions or proceedings (whether commenced or threatened) and expenses (including reasonable fees of counsel) to which each such indemnified party may become subject under the Securities Act, the Exchange Act or otherwise (collectively,

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“ Claims ”), insofar as such Claims arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement under which such securities were registered under the Securities Act or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or summary prospectus or any amendment or supplement thereto, together with the documents incorporated by reference therein, or any free writing prospectus utilized in connection therewith, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and the Company will reimburse any such indemnified party for any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim as such expenses are incurred; provided , however , that the Company shall not be liable to any such indemnified party in any such case to the extent such Claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact made in such registration statement or amendment thereof or supplement thereto or in any such prospectus or any preliminary, final or summary prospectus or free writing prospectus in reliance upon and in conformity with written information furnished to the Company by or on behalf of such indemnified party specifically for use therein; provided , further , however , that the Company shall not be liable to any such indemnified party with respect to any amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld).  Such indemnity and reimbursement of expenses shall remain in full force and effect regardless of any investigation made by or on behalf of such indemnified party and shall survive the transfer of Registrable Securities by an Investor.  Notwithstanding any of the foregoing to the contrary, the foregoing indemnity agreement shall not inure to the benefit of any Investor or underwriter, or any person controlling or claiming through such Investor or underwriter, from whom the person asserting any such Claim purchased shares in the offering (i) with respect to any preliminary prospectus, if a copy of the prospectus (as then amended or supplemented and previously provided by the Company to the Investor or underwriter, as applicable, in accordance with Section 3(d) ) was not sent or given by or on behalf of such Investor or underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the shares to such Person, and if the prospectus (as so amended or supplemented) would have cured the defect giving rise to such Claim and (ii) with respect to any Registration Statement, preliminary, final or summary prospectus or any amendment or supplement thereto, or any free writing prospectus utilized in connection therewith, if any such document was used during a Black Out Period.

(b)            Obligations of the Investors to Indemnify .  Each Investor selling Registrable Securities shall, severally and not jointly, indemnify and hold harmless (in the same manner and to the same extent as set forth in Section 7(a) ) the Company, its officers, directors, employees, legal counsel and accountants, each Person controlling the Company within the meaning of the Securities Act and each of the other Investors and their respective directors, officers, stockholders, fiduciaries, managing directors, agents, affiliates, consultants, representatives, successors, assigns or general and limited partners and respective controlling Persons for Claims insofar as such Claims arise out of are based upon any untrue statement or alleged untrue statement of any material fact in, or omission or alleged omission of any material fact from, such

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registration statement, any preliminary, final or summary prospectus contained therein, or any amendment or supplement thereto, or any free writing prospectus utilized in connection therewith, if such statement or alleged statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company or its representatives by or on behalf of such Investor specifically for use therein, and each such Investor shall reimburse such indemnified party for any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim as such expenses are incurred; provided , however , that the aggregate amount which any such Investor shall be required to pay pursuant to this Section 7(b)  and/or any other provisions of this Section 7 shall in no case be greater than the amount of the net proceeds received by such Investor upon the sale of the Registrable Securities pursuant to the registration statement giving rise to such Claim.

(c)            Procedure .  Any Person entitled to indemnification under this Agreement shall notify promptly the indemnifying party in writing of the commencement of any action or proceeding with respect to which a claim for indemnification may be made pursuant to this Section 7 , but the failure of any indemnified party to provide such notice shall not relieve the indemnifying party of its obligations under the preceding paragraphs of this Section 7 , except to the extent the indemnifying party is materially and actually prejudiced thereby, and shall not relieve the indemnifying party from any liability which it may have to any indemnified party otherwise than under this Agreement.  In case any action or proceeding is brought against an indemnified party and it shall notify the indemnifying party of the commencement thereof (as required above), the indemnifying party shall be entitled to participate therein and to assume the defense thereof jointly with any other indemnifying party similarly notified, to the extent that it chooses, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party, the indemnifying party shall not be liable to such indemnified party for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided , however , that (i) if the indemnifying party fails to take reasonable steps necessary to defend diligently the action or proceeding within twenty (20) days after receiving notice from such indemnified party that the indemnified party believes it has failed to do so; or (ii) if such indemnified party who is a defendant in any action or proceeding which is also brought against the indemnifying party reasonably shall have concluded that there may be one or more legal or equitable defenses available to such indemnified party which are not available to the indemnifying party or which may conflict with those available to another indemnified party with respect to such Claim; or (iii) if representation of both parties by the same counsel is otherwise, in the reasonable opinion of outside counsel to the indemnified party, a conflict of interest between such indemnified and indemnifying party may exist in respect of such claim, then, in any such case, the indemnified party shall have the right to assume or continue its own defense as set forth above (but with no more than one firm of counsel for all indemnified parties in each jurisdiction) and the indemnifying party shall be liable for any reasonable expenses therefor.  No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (A) includes an unconditional release of the indemnified party from all liability arising out of such action or

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claim and (B) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.

(d)            Contribution .  If for any reason the foregoing indemnity is unavailable, unenforceable or is insufficient to hold harmless an indemnified party under Sections 7(a)  or (b) , then each applicable indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of any Claim in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and the indemnified party, on the other hand, with respect to such Claim, as well as other relevant equitable considerations.  The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission.  If, however, the allocation provided in the second preceding sentence is not permitted by applicable law, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative faults but also the relative benefits of the indemnifying party and the indemnified party as well as any other relevant equitable considerations.  The parties hereto agree that it would not be just and equitable if any contribution pursuant to this Section 7(d)  were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentences of this Section 7(d) .  The amount paid or payable in respect of any Claim shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim.  No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.  Notwithstanding anything in this Section 7(d)  to the contrary, no indemnifying party (other than the Company) shall be required pursuant to this Section 7(d)  to contribute any amount in excess of the net proceeds received by such indemnifying party from the sale of Registrable Securities in the offering to which the losses, claims, damages or liabilities of the indemnified parties relate, less the amount of any indemnification payment made by such indemnifying party pursuant to Section 7(b) .

(e)            Other Agreements .  Notwithstanding this Section 7 , to the extent that the provisions on indemnification and contribution contained in the underwriting agreement, if any, entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

(f)             Payments .  The indemnification and contribution required by this Section 7 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or expense, loss, damage or liability is incurred.

(g)            Survival .  The indemnification and contribution provided for under this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of such indemnified party and will survive the transfer of any Registrable Securities.

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8.              REPORTS UNDER THE EXCHANGE ACT .  With a view to making available to the Investors all of the benefits of Rule 144 (or any similar successor rule), the Company agrees to: (i) make and keep public information available, as those terms are understood and defined in Rule 144 (or any similar successor rule), (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act and (iii) furnish to each Investor so long as such Investor owns Registrable Securities, promptly upon request, (A) a written statement by the Company that it has complied with the reporting requirements of Rule 144 (or any similar successor rule) and the Exchange Act, (B) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company and (C) such other information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 (or any similar successor rule) without registration.

9.              MISCELLANEOUS .

(a)            Other Registration Rights .

(i)             The Company has not previously entered into any agreement granting any registration rights with respect to any of its securities to any Person which have not been fully satisfied.

(ii)            The Company may hereafter grant to any Person or Persons the right to request the Company to register any equity securities of the Company (the “ Subsequent Registration Rights ”), or any securities convertible or exchangeable into or exercisable for such securities, without the prior written consent of the holders of the Registrable Securities; provided , however , that, except for any equity securities issued to the Investors in the future, the Subsequent Registration Rights may not have priority over, or parity with, the registration rights of the Registrable Securities hereunder in any respect and such Subsequent Registration Rights shall have no piggyback rights on any registration and sale of Registrable Securities hereunder.

(b)            General Piggyback Rights of the Investors .  If at any time during the Registration Period, there is not an effective Registration Statement covering all of the Registrable Securities for any reason whatsoever and the Company has filed, or is preparing to file, with the SEC a registration statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other employee benefit plans, then the Company shall send to each Investor written notice of such determination and (i) the Company shall not effect such filing without reasonable prior written notice to the Investor Representative and (ii) if, within ten (10) days after receipt of such notice, any such Investor shall so request in writing, the Company shall include in such registration statement all or any part of such Registrable Securities such Investor requests to be registered, subject to customary underwriter cutbacks applicable to all holders of registration rights, which customary underwriter cutbacks shall be applied such that shares of Common Stock are included in such registration as follows:  first , all shares of Common Stock to be offered by the Company and all Registrable Securities to be offered by Investors, pro rata among the Company and such participating Investors, and second ,

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shares of Common Stock to be offered by any other holders of registration rights.  For the avoidance of doubt, all of the covenants and obligations of the Company hereunder shall apply to such piggy back registration, to the extent consistent with this Section 9(b) .

(c)            Assignment of Registration Rights .  The registration rights of any Investor under this Agreement with respect to any Registrable Securities may be assigned to:

(i)             any Person who acquires at least 714,285 of such Registrable Securities (as adjusted for stock splits, reverse stock splits, stock dividends and the like); and/or

(ii)            any of the following Persons, if they acquire Registrable Securities: (A) any Affiliate of the Investor, (B) if the Investor is a partnership, its partners or former partners in accordance with partnership interests or the estate of any such partner or former partner or a liquidating trust for the benefit of its partners, (C) if the Investor is a limited liability company, its members or former members in accordance with their interest in the limited liability company, (D) if the Investor is a corporation, its majority owned subsidiaries or Affiliates thereof or (E) if the Investor is an individual, the Investor’s family members or trust for the benefit of such Investor or his or her family members or an entity whose equity owners consist solely of the Investor and his or her family members.

Upon any such permitted assignment, (i) the Investor shall give the Company written notice at or prior to the time of such assignment stating the name and address of the assignee and identifying the shares with respect to which the rights under this Agreement are being assigned; (ii) such assignee shall agree in writing, in form and substance reasonably satisfactory to the Company, to be bound to the same extent and in the same capacity as the Investor by the provisions of this Agreement; and (iii) such assignee shall acknowledge, immediately following such assignment, that the further disposition of such securities by such assignee may be restricted under the Securities Act. In connection with any such transfer the Company shall, at its sole cost and expense, promptly after such assignment take such reasonable actions as shall be reasonably acceptable to the Investors and such permitted transferee to assure that the Registration Statement and related prospectus are available for use by such permitted transferee for sales of the Registrable Securities in respect of which the rights to registration have been so assigned.  Notwithstanding any other provision of this Agreement, no Person who acquires securities transferred in violation of this Agreement, or who acquires securities that are not, or upon acquisition cease to be, Registrable Securities, shall have any rights under this Agreement with respect to such securities, and such securities shall not have the benefits afforded hereunder to Registrable Securities.

(d)            Successors and Assigns; Third Party Beneficiaries .  Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto will bind and inure to the benefit of the respective permitted successors and assigns of the parties hereto, whether so expressed or not.

(e)            Severability .  Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will

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be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.

(f)             Descriptive Headings .  The descriptive headings of this Agreement are inserted for convenience of reference only and do not constitute a part of, and shall not be utilized in interpreting, this Agreement.

(g)            Notices .  Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered:  (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) one (1) Business Day after deposit with a nationally recognized overnight delivery service or (iv) five (5) days after deposit in the U.S. mail, return receipt requested, in each case properly addressed to the party to receive the same.  The addresses and facsimile numbers for such communications shall be:

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If to an Investor, to its address and facsimile number set forth on the Schedule of Investors attached hereto, with copies to such Investor’s representatives as set forth on the Schedule of Investors, or to such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change.  Written confirmation of receipt or deposit in the U.S. mail, as the case may be, (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, recipient facsimile number and an image of the first page of such transmission, (C) provided by a courier or overnight courier service shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service or (D) by a signed return receipt in accordance with clause (i) , (ii) , (iii) , or (iv)  above, respectively.

(h)            Governing Law .  All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.  Each party hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.  If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

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(i)             Amendments and Waivers .  The provisions of this Agreement may be amended, waived or otherwise modified upon the written agreement of the Company and the Investor Representative.  Any waiver, permit, consent or approval of any kind or character on the part of any holders of any provision or condition of this Agreement must be made in writing and shall be effective only to the extent specifically set forth in writing.

(j)             Specific Performance .  The Company and the Investor acknowledge and agree that irreparable damage to the other party would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that each party shall be entitled to an injunction, injunctions or other equitable relief, without the necessity of posting a bond, to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof, this being in addition to any other remedy to which the parties may be entitled by law or equity.

(k)            Delays or Omissions .  It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring.  All remedies, either under this Agreement, by law, or otherwise afforded to any party, shall be cumulative and not alternative.

(l)             Final Agreement .  This Agreement constitutes the complete and final agreement of the parties concerning the matters referred to herein and supersedes all prior agreements and understandings.

(m)           Execution .  This Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement.  This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

(n)            Consents .  All consents and other determinations to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified in this Agreement, by the Investor Representative.

(o)            Construction .  The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied against any party.

(p)            Termination of Agreement .  This Agreement and all registration rights granted to an Investor shall terminate and be of no further force or effect with respect to that Investor if both of the following conditions are satisfied: (i) all Registrable Securities then held by and issuable to such Investor (and its affiliates, partners and former partners, members and former members) may be sold under Rule 144 during any ninety (90) day period and the certificates evidencing such Registrable Securities bear no legends restricting the transfer thereof (and, to the extent such securities are issued in global form, bear an unrestricted CUSIP number) and (ii) the

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Company’s Common Stock is traded on a national securities exchange or quoted on an automated inter-dealer quotation system; provided that Section 7 , Section 9 and any accrued but unpaid obligation of the Company in respect of Liquidated Damages shall survive any termination under this Section 9(p) .

* * * * * *

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[Signature Page to GP Strategies Corporation

Registration Rights Agreement]

IN WITNESS WHEREOF, the Purchaser and the Company have caused this Registration Rights Agreement to be duly executed as of the date first written above.

[Signature Page to GP Strategies Corporation

Registration Rights Agreement]

IN WITNESS WHEREOF, the Purchaser and the Company have caused this Registration Rights Agreement to be duly executed as of the date first written above.

EXHIBIT A

Plan of Distribution

Each Selling Stockholder (the “ Selling Stockholders ”) of the common stock and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common stock covered hereby on any stock exchange, market or trading facility on which the shares are traded or in private transactions.  These sales may be at fixed or negotiated prices.  A Selling Stockholder may use any one or more of the following methods when selling shares:

·                   ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

·                   block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

·                   purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

·                   an exchange distribution in accordance with the rules of the applicable exchange;

·                   privately negotiated transactions;

·                   settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part;

·                   in transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share;

·                   through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;

·                   a combination of any such methods of sale; or

·                   any other method permitted pursuant to applicable law.

The Selling Stockholders may also sell shares under Rule 144 under the Securities Act of 1933, as amended (the “ Securities Act ”), if available, rather than under this prospectus.

Broker-dealers engaged by the Selling Stockholders may arrange for other brokers-dealers to participate in sales.  Broker-dealers may receive commissions or discounts from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with FINRA IM-2440.

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In connection with the sale of the common stock or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume.  The Selling Stockholders may also sell shares of the common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities.  The Selling Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

The Selling Stockholders and any broker-dealers or agents that are involved in selling the shares may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales.  In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.  Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the Common Stock.

The Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the shares.  The Company has agreed to indemnify the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.

Because Selling Stockholders may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder.  The Selling Stockholders have advised us that there is no underwriter or coordinating broker acting in connection with the proposed sale of the resale shares by the Selling Stockholders.

We agreed to keep this prospectus effective until all of the shares continuing to have registration rights have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect.  The resale shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale shares of Common Stock covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution.  In addition, the Selling Stockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock by the Selling Stockholders or any other person.  We will make copies of this prospectus available to the Selling Stockholders and have informed them of the need to deliver a

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copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

A-3

EXHIBIT B

GP Strategies Corporation

Notice of Registration Statement
and
Selling Securityholder Questionnaire

[Date]

Reference is hereby made to the Registration Rights Agreement (the “Registration Rights Agreement” ) between GP Strategies Corporation (the “Company” ) and the Investors named therein.  Pursuant to the Registration Rights Agreement, the Company has filed or will file with the United States Securities and Exchange Commission (the “Commission” ) a registration statement on Form S-3 (the “Shelf Registration Statement” ) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act” ), of the Company’s common stock issued in connection with the Company’s recently completed private exchange offers (the “Securities” ).  A copy of the Registration Rights Agreement has been filed with the Commission on Form 8-K and can be obtained from the Commission’s website at www.sec.gov.  All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement.

Each holder of Registrable Securities (as defined in the Registration Rights Agreement) is entitled to have the Registrable Securities held by it included in the Shelf Registration Statement (or a supplement or amendment thereto).  In order to have Registrable Securities included in the Shelf Registration Statement, this Notice of Registration Statement and Selling Securityholder Questionnaire ( “Notice and Questionnaire” ) must be completed, executed and delivered to the Company’s counsel at the address set forth herein for receipt ON OR BEFORE [                  ] .  Holders of Registrable Securities who do not properly complete, execute and return this Notice and Questionnaire by such date (i) will not be named as selling securityholders in the Shelf Registration Statement and (ii) may not use the Prospectus forming a part thereof for resales of Registrable Securities.

Certain legal consequences arise from being named as a selling securityholder in the Shelf Registration Statement and related Prospectus.  Accordingly, holders and beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or not being named as a selling securityholder in the Shelf Registration Statement and related Prospectus.

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ELECTION

The undersigned holder (the “Selling Securityholder” ) of Registrable Securities hereby elects to include in the Shelf Registration Statement the Registrable Securities beneficially owned by it and listed below in Item (3).  The undersigned, by signing and returning this Notice and Questionnaire, agrees to be bound with respect to such Registrable Securities by the terms and conditions of this Notice and Questionnaire and the Registration Rights Agreement, including, without limitation, Section 5 of the Registration Rights Agreement, as if the undersigned Selling Securityholder were an original party thereto.

Pursuant to the Registration Rights Agreement, the undersigned has agreed to indemnify and hold harmless the Company, its officers who sign any Shelf Registration Statement, and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act of 1934, as amended (the “Exchange Act” ), against certain losses arising out of an untrue statement, or the alleged untrue statement, of a material fact in the Shelf Registration Statement or the related prospectus or the omission, or alleged omission, to state a material fact required to be stated in such Shelf Registration Statement or the related prospectus, but only to the extent such untrue statement or omission, or alleged untrue statement or omission, was made in reliance on and in conformity with the information provided in this Notice and Questionnaire.

Upon any sale of Registrable Securities pursuant to the Shelf Registration Statement, the Selling Securityholder will be required to deliver to the Company and Transfer Agent the Notice of Transfer set forth in Exhibit C to the Registration Rights Agreement.

The Selling Securityholder hereby provides the following information to the Company and represents and warrants that such information is true, accurate and complete:

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QUESTIONNAIRE