COSTS AND
EXPENSES, INCLUDING ALL JUDGMENTS, AMOUNTS PAID IN SETTLEMENTS, COURT COSTS AND
REASONABLE ATTORNEYS' FEES AND COSTS OF INVESTIGATION (COLLECTIVELY, "LOSSES")
THAT ANY SUCH INVESTOR PARTY MAY SUFFER OR INCUR AS A RESULT OF OR RELATING TO
ANY MISREPRESENTATION, BREACH OR INACCURACY OF ANY REPRESENTATION, WARRANTY,
COVENANT OR AGREEMENT MADE BY THE COMPANY IN ANY TRANSACTION DOCUMENT.
IN
ADDITION TO THE INDEMNITY CONTAINED HEREIN, THE COMPANY WILL REIMBURSE EACH
INVESTOR PARTY FOR ITS REASONABLE LEGAL AND OTHER EXPENSES (INCLUDING THE COST
OF ANY INVESTIGATION, PREPARATION AND TRAVEL IN CONNECTION THEREWITH) INCURRED
IN CONNECTION THEREWITH, AS SUCH EXPENSES ARE INCURRED.
NOTWITHSTANDING THE
FOREGOING, THE COMPANY'S AGGREGATE OBLIGATIONS UNDER THIS SECTION 4.6 SHALL NOT
EXCEED THE SUM OF $5,500,000.
4.7
NON-PUBLIC INFORMATION.
THE COMPANY AGREES TO MAKE MANAGEMENT
AVAILABLE TO THE INVESTORS FOR PERIODIC UPDATES ON PROGRESS WITH RESPECT TO
MATERIAL TRANSACTIONS PROVIDED THE INVESTORS SHALL HAVE EXECUTED A WRITTEN
AGREEMENT REGARDING THE CONFIDENTIALITY AND USE OF SUCH INFORMATION, AND,
PROVIDED FURTHER, THAT THE INVESTORS MAY AT ANY TIME WAIVE THE RIGHT TO RECEIVE
SUCH PERIODIC UPDATES.
19
4.8
LISTING OF SECURITIES.
THE COMPANY AGREES, (I) IF THE COMPANY
APPLIES TO HAVE THE COMMON STOCK TRADED ON ANY OTHER TRADING MARKET, IT WILL
INCLUDE IN SUCH APPLICATION THE UNDERLYING SHARES AND WARRANT SHARES, AND WILL
TAKE SUCH OTHER ACTION AS IS NECESSARY TO CAUSE THE UNDERLYING SHARES AND
WARRANT SHARES TO BE LISTED ON SUCH OTHER TRADING MARKET AS PROMPTLY AS
POSSIBLE, AND (II) IT WILL TAKE ALL ACTION REASONABLY NECESSARY TO CONTINUE THE
LISTING AND TRADING OF ITS COMMON STOCK ON A TRADING MARKET AND WILL COMPLY IN
ALL MATERIAL RESPECTS WITH THE COMPANY'S REPORTING, FILING AND OTHER OBLIGATIONS
UNDER THE BYLAWS OR RULES OF THE TRADING MARKET.
4.9
USE OF PROCEEDS.
THE COMPANY WILL USE THE NET PROCEEDS FROM
THE SALE OF THE SECURITIES HEREUNDER FOR WORKING CAPITAL PURPOSES AND NOT TO
REDEEM ANY COMMON STOCK OR COMMON STOCK EQUIVALENTS.
4.10
BOARD OBSERVER RIGHTS.
IF A "DEEMED LIQUIDATION" AS DEFINED IN
THE ARTICLES OF AMENDMENT SHALL NOT HAVE OCCURRED BY THE FIRST ANNIVERSARY OF
THE CLOSING DATE, THE INVESTORS SHALL COLLECTIVELY BE ENTITLED TO DESIGNATE ONE
PERSON TO ATTEND ALL MEETINGS OF THE COMPANY'S BOARD OF DIRECTORS, THE AUDIT
COMMITTEE (EXCLUDING, HOWEVER, EXECUTIVE SESSIONS OF THE AUDIT COMMITTEE) OF THE
BOARD OF DIRECTORS AND ANY EXECUTIVE COMMITTEE OF THE BOARD OF DIRECTORS THAT
MAY HEREAFTER BE CREATED IN A NONVOTING OBSERVER CAPACITY AND, IN THIS RESPECT,
THE COMPANY SHALL GIVE SUCH DESIGNEE COPIES OF ALL NOTICES, MINUTES, CONSENTS,
AND OTHER MATERIALS THAT IT PROVIDES TO ITS DIRECTORS AT THE SAME TIME AND IN
THE SAME MANNER AS PROVIDED TO SUCH DIRECTORS; PROVIDED, HOWEVER, THAT SUCH
DESIGNEE SHALL ENTER INTO A WRITTEN CONFIDENTIALITY AGREEMENT AND AGREE TO HOLD
IN CONFIDENCE AND TRUST AND TO ACT IN A FIDUCIARY MANNER WITH RESPECT TO ALL
INFORMATION SO PROVIDED; AND PROVIDED FURTHER, THAT THE COMPANY RESERVES THE
RIGHT TO WITHHOLD ANY INFORMATION AND TO EXCLUDE SUCH DESIGNEE FROM ANY MEETING
OR PORTION