DEFENSE THEREOF WITH COUNSEL OF ITS OWN
CHOOSING REASONABLY ACCEPTABLE TO THE PURCHASER PARTY.
ANY PURCHASER PARTY
SHALL HAVE THE RIGHT TO EMPLOY SEPARATE COUNSEL IN ANY SUCH ACTION AND
PARTICIPATE IN THE DEFENSE THEREOF, BUT THE FEES AND EXPENSES OF SUCH COUNSEL
SHALL BE AT THE EXPENSE OF SUCH PURCHASER PARTY EXCEPT TO THE EXTENT THAT
(I) THE EMPLOYMENT THEREOF HAS BEEN SPECIFICALLY AUTHORIZED BY THE COMPANY IN
WRITING, (II) THE COMPANY HAS FAILED AFTER A REASONABLE PERIOD OF TIME TO ASSUME
SUCH DEFENSE AND TO EMPLOY COUNSEL OR (III) IN SUCH ACTION THERE IS, IN THE
REASONABLE OPINION OF SUCH SEPARATE COUNSEL, A MATERIAL CONFLICT ON ANY MATERIAL
ISSUE BETWEEN THE POSITION OF THE COMPANY AND THE POSITION OF SUCH PURCHASER
PARTY, IN WHICH CASE THE COMPANY SHALL BE RESPONSIBLE FOR THE REASONABLE FEES
AND EXPENSES OF NO MORE THAN ONE SUCH SEPARATE COUNSEL FOR ALL PURCHASER
PARTIES.
THE COMPANY WILL NOT BE LIABLE TO ANY PURCHASER PARTY UNDER THIS
AGREEMENT (Y) FOR ANY SETTLEMENT BY A PURCHASER PARTY EFFECTED WITHOUT THE
COMPANY'S PRIOR WRITTEN CONSENT, WHICH SHALL NOT BE UNREASONABLY WITHHELD OR
DELAYED; OR (Z) TO THE EXTENT, BUT ONLY TO THE EXTENT THAT A LOSS, CLAIM, DAMAGE
OR LIABILITY IS ATTRIBUTABLE TO ANY PURCHASER'S BREACH OF ANY OF THE
REPRESENTATIONS, WARRANTIES, COVENANTS OR AGREEMENTS MADE BY SUCH PURCHASER IN
THIS AGREEMENT OR IN THE OTHER TRANSACTION DOCUMENTS.
18
6.11.
FORM D; BLUE SKY FILINGS.
THE COMPANY AGREES TO TIMELY FILE A
FORM D WITH RESPECT TO THE SHARES AS REQUIRED UNDER REGULATION D AND TO PROVIDE
A COPY THEREOF, PROMPTLY UPON REQUEST OF ANY PURCHASER.
THE COMPANY SHALL TAKE
SUCH ACTION AS THE COMPANY SHALL REASONABLY DETERMINE IS NECESSARY IN ORDER TO
OBTAIN AN EXEMPTION FOR, OR TO QUALIFY THE SHARES FOR, SALE TO THE PURCHASERS AT
THE CLOSING UNDER APPLICABLE SECURITIES OR "BLUE SKY" LAWS OF THE STATES OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND SHALL PROVIDE EVIDENCE
OF SUCH ACTIONS PROMPTLY UPON REQUEST OF ANY PURCHASER.
6.12.
SALE RESTRICTION.
EACH PURCHASER AGREES NOT TO DIRECTLY OR
INDIRECTLY OFFER, SELL, ASSIGN, TRANSFER, PLEDGE, CONTRACT TO SELL, OR OTHERWISE
DISPOSE OF ANY SHARES BEGINNING ON THE DATE THAT THE SHARES ARE ISSUED IN
ACCORDANCE WITH SECTION 1.2 HEREOF AND ENDING EIGHTEEN (18) MONTHS THEREAFTER.
6.13.
EXPENSES OF PURCHASERS.
AS A CONDITION TO THE CLOSING, THE COMPANY
AGREES TO REIMBURSE THE PURCHASERS FOR THE PAYMENT OF ALL OUT-OF-POCKET FEES AND
EXPENSES INCURRED BY THE PURCHASERS IN CONNECTION WITH THE PREPARATION AND
NEGOTIATION OF THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS AND THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY (THE "EXPENSES") IN AN
AMOUNT NOT TO EXCEED $75,000.
THE EXPENSES MAY INCLUDE THE REASONABLE LEGAL
FEES AND EXPENSES OF ONE LAW FIRM AS COUNSEL TO THE PURCHASERS.
6.14.
BOARD OF DIRECTORS.
THE COMPANY SHALL TAKE ALL ACTIONS REASONABLY
NECESSARY TO EFFECTUATE THE RIGHT OF THE HOLDERS OF SERIES A PREFERRED STOCK TO
DESIGNATE ONE (1) MEMBER OF THE BOARD, IN ACCORDANCE WITH THE PROVISIONS OF