AS
CASH COLLATERAL FOR THE OBLIGATIONS.
NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS SECTION 13(L), LAURUS' APPROVAL SHALL NOT BE REQUIRED WITH
RESPECT TO ANY TRANSFER BY ANY COMPANY OF CASH TO ANY FOREIGN SUBSIDIARY OF NOT
MORE THAN $50,000 IN THE AGGREGATE PER BUSINESS DAY, PROVIDED THAT (X) SUCH
TRANSFERS ARE MADE IN THE ORDINARY COURSE OF BUSINESS CONSISTENT WITH ITS
BUSINESS PRACTICES AND (Y) SUCH TRANSFERS ARE MADE BY A COMPANY TO A FOREIGN
SUBSIDIARY FOR THE DIRECT PURPOSE OF REIMBURSING AND/OR PAYING SUCH FOREIGN
SUBSIDIARY FOR (I) THE COST OF SHIPPING EXPENSES AND (II) AIRLINE CARRIER
EXPENSES, IN EACH CASE, INCURRED BY SUCH FOREIGN SUBSIDIARY FOR THE BENEFIT OF
SUCH COMPANY.
COMPANY AGENT SHALL PROVIDE LAURUS A REPORT NOT LATER THAN THE
FIFTH BUSINESS DAY OF EACH MONTH DETAILING ALL SUCH CASH TRANSFERS MADE BY THE
COMPANIES FOR THE IMMEDIATELY PRECEDING MONTH.
(M)
REISSUANCE OF SECURITIES.
THE PARENT SHALL
REISSUE CERTIFICATES REPRESENTING THE SECURITIES WITHOUT THE LEGENDS SET FORTH
IN SECTION 39 BELOW AT SUCH TIME AS:
(I)
THE HOLDER THEREOF IS PERMITTED TO
DISPOSE OF SUCH SECURITIES PURSUANT TO RULE 144(K) UNDER THE SECURITIES ACT; OR
(II)
UPON RESALE SUBJECT TO AN EFFECTIVE
REGISTRATION STATEMENT AFTER SUCH SECURITIES ARE REGISTERED UNDER THE SECURITIES
ACT.
The Parent agrees to cooperate with Laurus in connection with all resales
pursuant to Rule 144(d) and Rule 144(k) and provide legal opinions necessary to
allow such resales provided the Parent and its counsel receive reasonably
requested representations from Laurus and broker, if any.
(N)
OPINION.
ON THE CLOSING DATE, IT SHALL
DELIVER TO LAURUS AN OPINION REASONABLY ACCEPTABLE TO LAURUS FROM EACH COMPANY'S
LEGAL COUNSEL.
EACH COMPANY WILL PROVIDE, AT THE COMPANIES' JOINT AND SEVERAL
EXPENSE, SUCH OTHER LEGAL OPINIONS IN THE FUTURE AS ARE REASONABLY NECESSARY FOR
THE CONVERSION OF THE NOTES AND THE EXERCISE OF THE WARRANTS.
(O)
LEGAL NAME, ETC.
IT SHALL NOT, WITHOUT
PROVIDING LAURUS WITH 30 DAYS PRIOR WRITTEN NOTICE, CHANGE (I) ITS NAME AS IT
APPEARS IN THE OFFICIAL FILINGS IN THE STATE OF ITS ORGANIZATION, (II) THE TYPE
OF LEGAL ENTITY IT IS, (III) ITS ORGANIZATION IDENTIFICATION NUMBER, IF ANY,
ISSUED BY ITS STATE OF ORGANIZATION, (IV) ITS STATE OF ORGANIZATION OR (V) AMEND
ITS CERTIFICATE OF INCORPORATION, BY-LAWS OR OTHER ORGANIZATIONAL DOCUMENT.
(P)
COMPLIANCE WITH LAWS.
THE OPERATION OF EACH
OF ITS AND EACH OF ITS SUBSIDIARIES' BUSINESS IS AND SHALL CONTINUE TO BE IN
COMPLIANCE IN ALL MATERIAL RESPECTS WITH ALL APPLICABLE FEDERAL, STATE AND LOCAL
LAWS, RULES AND ORDINANCES, INCLUDING TO ALL LAWS, RULES, REGULATIONS AND ORDERS
RELATING TO TAXES, PAYMENT AND WITHHOLDING OF PAYROLL TAXES, EMPLOYER AND
28
EMPLOYEE CONTRIBUTIONS AND SIMILAR ITEMS, SECURITIES, EMPLOYEE RETIREMENT AND
WELFARE BENEFITS, EMPLOYEE HEALTH AND SAFETY AND ENVIRONMENTAL MATTERS.
(Q)
NOTICES.
IT AND EACH OF ITS SUBSIDIARIES
SHALL PROMPTLY INFORM LAURUS IN WRITING OF:
(I) THE COMMENCEMENT OF ALL
PROCEEDINGS AND INVESTIGATIONS BY OR BEFORE AND/OR THE RECEIPT OF ANY NOTICES
FROM, ANY GOVERNMENTAL OR NONGOVERNMENTAL BODY AND ALL ACTIONS AND