STOCKHOLDER OR ANY
VIOLATIONS BY THE PURCHASER OF STATE OR FEDERAL SECURITIES LAWS OR ANY CONDUCT
BY SUCH PURCHASER WHICH CONSTITUTES FRAUD, GROSS NEGLIGENCE, WILLFUL MISCONDUCT
OR MALFEASANCE).
IF ANY ACTION SHALL BE BROUGHT AGAINST ANY PURCHASER PARTY IN
RESPECT OF WHICH INDEMNITY MAY BE SOUGHT PURSUANT TO THIS AGREEMENT, SUCH
PURCHASER PARTY SHALL PROMPTLY NOTIFY THE COMPANY IN WRITING, AND THE COMPANY
SHALL HAVE THE RIGHT TO ASSUME THE DEFENSE THEREOF WITH COUNSEL OF ITS OWN
CHOOSING.
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
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COMPANY AND THE POSITION OF SUCH PURCHASER PARTY.
THE COMPANY WILL NOT BE
LIABLE TO ANY PURCHASER PARTY UNDER THIS AGREEMENT (I) FOR ANY SETTLEMENT BY A
PURCHASER PARTY EFFECTED WITHOUT THE COMPANY'S PRIOR WRITTEN CONSENT, WHICH
SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED; OR (II) TO THE EXTENT, BUT ONLY
TO THE EXTENT THAT A LOSS, CLAIM, DAMAGE OR LIABILITY IS ATTRIBUTABLE TO ANY
PURCHASER PARTY'S BREACH OF ANY OF THE REPRESENTATIONS, WARRANTIES, COVENANTS OR
AGREEMENTS MADE BY THE PURCHASERS IN THIS AGREEMENT OR IN THE OTHER TRANSACTION
DOCUMENTS.
4.12
RESERVATION AND LISTING OF SECURITIES.
(A)
THE COMPANY SHALL MAINTAIN A RESERVE FROM
ITS DULY AUTHORIZED SHARES OF COMMON STOCK FOR ISSUANCE PURSUANT TO THE
TRANSACTION DOCUMENTS IN SUCH AMOUNT AS MAY BE REQUIRED TO FULFILL ITS
OBLIGATIONS IN FULL UNDER THE TRANSACTION DOCUMENTS.
(B)
IF, ON ANY DATE, THE NUMBER OF AUTHORIZED
BUT UNISSUED (AND OTHERWISE UNRESERVED) SHARES OF COMMON STOCK IS LESS THAN 130%
OF (I) THE ACTUAL MINIMUM ON SUCH DATE, MINUS (II) THE NUMBER OF SHARES OF
COMMON STOCK PREVIOUSLY ISSUED PURSUANT TO THE TRANSACTION DOCUMENTS, THEN THE
BOARD OF DIRECTORS OF THE COMPANY SHALL USE COMMERCIALLY REASONABLE EFFORTS TO
AMEND THE COMPANY'S CERTIFICATE OR ARTICLES OF INCORPORATION TO INCREASE THE
NUMBER OF AUTHORIZED BUT UNISSUED SHARES OF COMMON STOCK TO AT LEAST THE ACTUAL
MINIMUM AT SUCH TIME (MINUS THE NUMBER OF SHARES OF COMMON STOCK PREVIOUSLY
ISSUED PURSUANT TO THE TRANSACTION DOCUMENTS), AS SOON AS POSSIBLE AND IN ANY
EVENT NOT LATER THAN THE 75TH DAY AFTER SUCH DATE; PROVIDED THAT THE COMPANY
WILL NOT BE REQUIRED AT ANY TIME TO AUTHORIZE A NUMBER OF SHARES OF COMMON STOCK
GREATER THAN THE MAXIMUM REMAINING NUMBER OF SHARES OF COMMON STOCK THAT COULD
POSSIBLY BE ISSUED AFTER SUCH TIME PURSUANT TO THE TRANSACTION DOCUMENTS.
(C)
THE COMPANY SHALL, IF APPLICABLE: (I) IN
THE TIME AND MANNER REQUIRED BY THE TRADING MARKET, PREPARE