SinoHub, Inc.(fka SIHI)

[solarity]

From 8K filed 9/28/09.

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=6815224-7317-56689&type=sect&dcn=0001214659-09-002304

As of August 31, 2009, we had issued and outstanding approximately (i) 25,056,671 shares of common stock, warrants for 2,467,596 shares of common stock and options exercisable for 1,198,309 shares of common stock These securities will be eligible for public sale only if registered under the Securities Act or if the stockholder qualifies for an exemption from registration under Rule 144 or Rule 701 under the Securities Act, or other applicable exemption. We believe that our stockholders will not be entitled to sell our shares pursuant to Rule 144 until March 30, 2010. In addition to the restrictions on resale imposed by the securities laws, a number of our outstanding shares are subject to contractual restrictions on resale. The holders of an aggregate of 7,352,750 shares of SinoHub common stock issued in respect of SinoHub International’s Series A, B and C Convertible Preferred Stock in connection with the reverse merger were entitled to piggy back and demand registration rights with respect to the shares of SinoHub International common stock into which such preferred stock was convertible pursuant to the terms of certain Stock Purchase Agreements entered into among SinoHub International and such holders. We have entered into an agreement with such holders to provide them with demand and piggyback registration rights with respect to the 7,352,750 shares of SinoHub common stock that such holders received in the Merger on the condition that such rights will not be exercisable until November 9, 2009. The holders of the 342,862 shares of the Company’s common stock issued in August 2009 are also parties to this agreement. Notwithstanding the provision that such rights are not exercisable until November 9, 2009, the Company has offered the parties to the agreement, along with the holders of warrants exercisable for an aggregate of 308,457 shares of the Company’s common stock the opportunity to register such shares for resale. An aggregate of 5,246,744 shares of outstanding common stock and 2,159,539 shares of common stock issuable upon exercise of outstanding warrants have been registered for resale under a currently effective registration statement. The market price of our capital stock could drop significantly if the holders of the shares being registered hereunder sell them or are perceived by the market as intending to sell them. Moreover, to the extent that additional shares of our outstanding stock are registered, or otherwise become eligible for resale, and are sold, or the holders of such shares are perceived as intended to sell them, this could further depress the market price of our common stock. These factors could also make it more difficult for us to raise capital or make acquisitions through the issuance of additional shares of our common stock or other equity securities.