ACT IN A MANNER THAT WILL NOT VIOLATE THE POSITIONS OF THE COMMISSION AS SET
FORTH IN ITEM 65, SECTION A, OF THE MANUAL OF PUBLICLY AVAILABLE TELEPHONE
INTERPRETATIONS, DATED JULY 1997, COMPILED BY THE OFFICE OF CHIEF COUNSEL,
DIVISION OF CORPORATION FINANCE. NOTWITHSTANDING THE FOREGOING, NO PURCHASER
MAKES ANY REPRESENTATION, WARRANTY OR COVENANT HEREBY THAT IT WILL NOT ENGAGE IN
SHORT SALES IN THE SECURITIES OF THE COMPANY AFTER THE TIME THAT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT ARE FIRST PUBLICLY ANNOUNCED AS
DESCRIBED IN SECTION 4.6.
NOTWITHSTANDING THE FOREGOING, IN THE CASE OF A
PURCHASER THAT IS A MULTI-MANAGED INVESTMENT VEHICLE WHEREBY SEPARATE PORTFOLIO
MANAGERS MANAGE SEPARATE PORTIONS OF SUCH PURCHASER'S ASSETS AND THE PORTFOLIO
MANAGERS HAVE NO DIRECT KNOWLEDGE OF THE INVESTMENT DECISIONS MADE BY THE
PORTFOLIO MANAGERS MANAGING OTHER PORTIONS OF SUCH PURCHASER'S ASSETS, THE
COVENANT SET FORTH ABOVE SHALL ONLY APPLY WITH RESPECT TO THE PORTION OF ASSETS
MANAGED BY THE PORTFOLIO MANAGER THAT MADE THE INVESTMENT DECISION TO PURCHASE
THE SECURITIES COVERED BY THIS AGREEMENT.
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4.16 FORM D; BLUE SKY FILINGS.
THE COMPANY AGREES TO TIMELY FILE A FORM D WITH
RESPECT TO THE SECURITIES 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 SECURITIES FOR, SALE TO THE PURCHASERS AT
THE CLOSING UNDER APPLICABLE SECURITIES OR "BLUE SKY" LAWS OF THE STATES OF THE
UNITED STATES, AND SHALL PROVIDE EVIDENCE OF SUCH ACTIONS PROMPTLY UPON REQUEST
OF ANY PURCHASER.
4.17 CAPITAL CHANGES.
UNTIL SUCH TIME THAT THE DEBENTURES ARE NO LONGER
OUTSTANDING,
THE COMPANY SHALL NOT UNDERTAKE A REVERSE OR FORWARD STOCK SPLIT
OR RECLASSIFICATION OF THE COMMON STOCK WITHOUT THE PRIOR WRITTEN CONSENT OF THE
PURCHASERS HOLDING 75% OF THE PRINCIPAL AMOUNT OUTSTANDING OF THE DEBENTURES.
4.18 SHAREHOLDER APPROVAL.
THE COMPANY SHALL USE ITS BEST EFFORTS TO EFFECT THE
SHAREHOLDER APPROVAL AS SOON AS PRACTICABLE FOLLOWING THE CLOSING DATE.
IT
SHALL BE AN
"EVENT OF DEFAULT" (AS DEFINED IN THE DEBENTURES) IN THE EVENT THAT
ANY OF THE FOLLOWING ITEMS DO NOT OCCUR ON OR BEFORE THE 60TH CALENDAR DAY
FOLLOWING THE DATE HEREOF:
(I) THE SHAREHOLDER APPROVAL DOES NOT OCCUR FOR ANY
REASON; (II) THE COMPANY HAS NOT DELIVERED EACH PURCHASER EVIDENCE OF THE FILING
OF THE AMENDMENT WITH THE SECRETARY OF STATE OF THE STATE OF NEVADA AND THE
ACCEPTANCE OF THE AMENDMENT BY THE SECRETARY OF STATE OF THE STATE OF NEVADA; OR
(III) THE COMPANY FAILS TO CAUSE ITS COUNSEL TO ISSUE EACH PURCHASER A LEGAL
OPINION REGARDING THE CAPITALIZATION OF THE COMPANY, INCLUDING THE DUE
RESERVATION OF ALL SHARES OF COMMON STOCK ISSUED AND ISSUABLE UNDER THE
TRANSACTION DOCUMENTS, WHICH OPINION SHALL BE IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY THE PURCHASERS.
ARTICLE V.
MISCELLANEOUS
5.1 TERMINATION.
THIS AGREEMENT MAY BE TERMINATED BY ANY PURCHASER, AS TO SUCH
PURCHASER'S OBLIGATIONS HEREUNDER ONLY AND