PAYMENTS IN A TIMELY
MANNER, SUCH EVENT PAYMENTS SHALL BEAR INTEREST AT THE RATE OF 1% PER MONTH
(PRORATED FOR PARTIAL MONTHS) UNTIL PAID IN FULL.
FOR SUCH PURPOSES, EACH OF THE FOLLOWING SHALL CONSTITUTE AN "EVENT":
(I)
THE REGISTRATION STATEMENT IS NOT FILED ON OR PRIOR TO THE FILING
DATE OR IS NOT DECLARED EFFECTIVE ON OR PRIOR TO THE REQUIRED EFFECTIVENESS
DATE;
(II)
AFTER THE EFFECTIVE DATE, A PURCHASER IS NOT PERMITTED TO SELL
REGISTRABLE SECURITIES UNDER THE REGISTRATION STATEMENT (OR A SUBSEQUENT
REGISTRATION STATEMENT FILED IN REPLACEMENT THEREOF) FOR ANY REASON FOR FIVE (5)
OR MORE TRADING DAYS (WHETHER OR NOT CONSECUTIVE);
20
(III)
AFTER THE EFFECTIVE DATE, ANY REGISTRABLE
SECURITIES COVERED BY SUCH REGISTRATION STATEMENT ARE NOT LISTED ON AN ELIGIBLE
MARKET;
(IV)
THE COMMON STOCK IS NOT LISTED OR QUOTED, OR
IS SUSPENDED FROM TRADING, ON AN ELIGIBLE MARKET FOR A PERIOD OF THREE (3)
TRADING DAYS (WHICH NEED NOT BE CONSECUTIVE TRADING DAYS);
(V)
THE COMPANY FAILS FOR ANY REASON TO DELIVER
A CERTIFICATE EVIDENCING ANY SECURITIES TO A PURCHASER WITHIN THREE (3) TRADING
DAYS AFTER DELIVERY OF SUCH CERTIFICATE IS REQUIRED PURSUANT TO ANY TRANSACTION
DOCUMENT OR THE EXERCISE RIGHTS OF THE PURCHASERS PURSUANT TO THE TRANSACTION
DOCUMENTS ARE OTHERWISE SUSPENDED FOR ANY REASON; OR
(VI)
THE COMPANY FAILS TO HAVE AVAILABLE A
SUFFICIENT NUMBER OF AUTHORIZED BUT UNISSUED AND OTHERWISE UNRESERVED SHARES OF
COMMON STOCK AVAILABLE TO ISSUE UNDERLYING SHARES UPON ANY EXERCISE OF THE
WARRANTS OR, AT ANY TIME FOLLOWING THE EFFECTIVE DATE, ANY SHARES OR UNDERLYING
SHARES ARE NOT LISTED ON AN ELIGIBLE MARKET.
(E)
THE COMPANY SHALL NOT, PRIOR TO THE
EFFECTIVE DATE OF THE REGISTRATION STATEMENT, PREPARE AND FILE WITH THE
COMMISSION 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.
6.2
REGISTRATION PROCEDURES.
IN CONNECTION WITH
THE COMPANY'S REGISTRATION OBLIGATIONS HEREUNDER, THE COMPANY SHALL:
(A)
NOT LESS THAN THREE (3) TRADING DAYS PRIOR
TO THE FILING OF A REGISTRATION STATEMENT OR ANY RELATED PROSPECTUS OR ANY
AMENDMENT OR SUPPLEMENT THERETO (INCLUDING ANY DOCUMENT THAT WOULD BE
INCORPORATED OR DEEMED TO BE INCORPORATED THEREIN BY REFERENCE), THE COMPANY
SHALL (I) FURNISH TO THE COUNSEL DESIGNATED BY ANY PURCHASER (EACH, A "PURCHASER
COUNSEL", AND VERTICAL VENTURES, L.L.C. HAS INITIALLY DESIGNATED PROSKAUER ROSE
LLP "LP COUNSEL") COPIES OF ALL SUCH DOCUMENTS PROPOSED TO BE FILED, WHICH
DOCUMENTS (OTHER THAN THOSE INCORPORATED OR DEEMED TO BE INCORPORATED BY
REFERENCE) WILL BE SUBJECT TO THE REVIEW OF SUCH PURCHASER COUNSEL, AND (II)
CAUSE ITS OFFICERS AND DIRECTORS, COUNSEL AND INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS TO RESPOND TO SUCH INQUIRIES AS SHALL BE NECESSARY, IN THE
REASONABLE OPINION OF RESPECTIVE COUNSEL, TO CONDUCT A REASONABLE INVESTIGATION
WITHIN THE MEANING OF THE SECURITIES ACT.
THE COMPANY SHALL NOT FILE A
REGISTRATION STATEMENT OR ANY SUCH PROSPECTUS OR ANY AMENDMENTS OR SUPPLEMENTS
THERETO TO WHICH PURCHASERS HOLDING A MAJORITY OF THE REGISTRABLE SECURITIES
SHALL REASONABLY OBJECT.
(B)
(I)