TO FILE A REGISTRATION STATEMENT OR TO CAUSE A REGISTRATION STATEMENT TO BE
DECLARED EFFECTIVE WITHIN THE TIME PERIODS SET FORTH HEREIN) UNTIL THE
APPLICABLE DEFAULT IS CURED (EACH, A "PAYMENT DATE"), THE COMPANY SHALL PAY TO
EACH INVESTOR AS DAMAGES ADDITIONAL SHARES OF THE COMPANY'S COMMON STOCK EQUAL
TO 2.0% OF THE COMMON SHARES PURCHASED BY SUCH INVESTOR PURSUANT TO THE PURCHASE
AGREEMENT AND ALL SUCH SHARES SHALL BECOME REGISTRABLE SECURITIES; PROVIDED,
THAT THE TOTAL NUMBER OF SHARES OF THE COMPANY'S COMMON STOCK PAYABLE PURSUANT
TO THIS SECTION 2.2 TO ANY INVESTOR SHALL NOT EXCEED THE AGGREGATE NUMBER OF
COMMON SHARES PURCHASED PURSUANT TO THE PURCHASE AGREEMENT BY SUCH INVESTOR.
IN
ADDITION, SHOULD A REGISTRATION STATEMENT NOT BE FILED BY JUNE 30, 2006, THE
EXERCISE PRICE OF THE WARRANTS WILL BE REDUCED TO $0.01 PER SHARE.
2.3
PIGGYBACK REGISTRATIONS.
(A)
IF, AT ANY TIME PRIOR TO THE EXPIRATION OF THE REGISTRATION
PERIOD, THE REGISTRATION STATEMENT CONTEMPLATED IN SECTION 2.1 ABOVE IS NOT
DECLARED EFFECTIVE WITH RESPECT TO ALL OF THE REGISTRABLE SECURITIES AND THE
COMPANY DECIDES TO REGISTER ANY OF ITS SECURITIES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF OTHERS, THEN THE COMPANY WILL PROMPTLY GIVE THE INVESTORS WRITTEN
NOTICE THEREOF AND WILL USE ITS BEST EFFORTS TO INCLUDE IN SUCH REGISTRATION ALL
OR ANY PART OF THE REGISTRABLE SECURITIES REQUESTED BY SUCH INVESTORS TO BE
INCLUDED THEREIN (EXCLUDING ANY REGISTRABLE SECURITIES PREVIOUSLY INCLUDED IN A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE AND HAS NOT BEEN
WITHDRAWN).
THIS REQUIREMENT DOES NOT APPLY TO COMPANY REGISTRATIONS ON
FORM S-4 OR S-8 OR THEIR EQUIVALENTS RELATING TO EQUITY SECURITIES TO BE ISSUED
SOLELY IN CONNECTION WITH AN ACQUISITION OF ANY ENTITY OR BUSINESS OR EQUITY
SECURITIES ISSUABLE IN CONNECTION WITH STOCK OPTION OR OTHER EMPLOYEE BENEFIT
PLANS.
EACH INVESTOR MUST GIVE ITS REQUEST FOR REGISTRATION UNDER THIS
PARAGRAPH TO THE COMPANY IN WRITING WITHIN 15 DAYS AFTER RECEIPT FROM THE
COMPANY OF NOTICE OF SUCH PENDING REGISTRATION.
IF THE REGISTRATION FOR WHICH
THE COMPANY GIVES NOTICE IS A PUBLIC OFFERING INVOLVING AN UNDERWRITING, THE
COMPANY WILL SO ADVISE THE INVESTORS AS PART OF THE ABOVE-DESCRIBED WRITTEN
NOTICE.
IN THAT EVENT, IF THE MANAGING UNDERWRITER(S) OF THE PUBLIC OFFERING
IMPOSE A LIMITATION ON THE NUMBER OF SHARES OF COMMON STOCK THAT MAY BE INCLUDED
IN THE REGISTRATION STATEMENT BECAUSE, IN SUCH UNDERWRITER(S)' JUDGMENT, SUCH
LIMITATION WOULD BE NECESSARY TO EFFECT AN ORDERLY PUBLIC DISTRIBUTION, THEN THE
COMPANY WILL BE OBLIGATED TO INCLUDE ONLY SUCH LIMITED PORTION, IF ANY, OF THE
REGISTRABLE SECURITIES WITH RESPECT TO WHICH SUCH INVESTORS HAVE REQUESTED
INCLUSION HEREUNDER.
ANY EXCLUSION OF REGISTRABLE SECURITIES WILL BE MADE PRO
RATA AMONG ALL HOLDERS OF THE COMPANY'S SECURITIES SEEKING TO INCLUDE SHARES OF
COMMON STOCK IN PROPORTION TO THE NUMBER OF SHARES OF COMMON STOCK SOUGHT TO BE
INCLUDED BY THOSE HOLDERS.
HOWEVER, THE COMPANY WILL NOT EXCLUDE ANY
REGISTRABLE SECURITIES UNLESS THE COMPANY HAS FIRST EXCLUDED ALL OUTSTANDING
SECURITIES THE HOLDERS OF WHICH ARE NOT ENTITLED BY