NOTWITHSTANDING, NOTHING IN THIS AGREEMENT SHALL
PROHIBIT THE COMPANY FROM NEGOTIATING AND ENTERING INTO SEPARATE SETTLEMENTS
WITH ANY PURCHASER IN THE EVENT OF LITIGATION ARISING OUT OF THE TRANSACTIONS
25
CONTEMPLATED BY THE TRANSACTION DOCUMENTS WITHOUT TRIGGERING THE OBLIGATION TO
MAKE A SIMILAR PAYMENT TO ANY OTHER PURCHASER.
4.12
[INTENTIONALLY LEFT BLANK]
4.13
SUBSEQUENT EQUITY SALES.
(A)
FROM THE DATE HEREOF UNTIL 90 DAYS AFTER THE EFFECTIVE DATE,
NEITHER THE COMPANY NOR ANY SUBSIDIARY SHALL ISSUE SHARES OF COMMON STOCK OR
COMMON STOCK EQUIVALENTS; PROVIDED, HOWEVER, THE 90 DAY PERIOD SET FORTH IN THIS
SECTION 4.13 SHALL BE EXTENDED FOR THE NUMBER OF TRADING DAYS DURING SUCH PERIOD
IN WHICH (I) TRADING IN THE COMMON STOCK IS SUSPENDED BY ANY TRADING MARKET, OR
(II) FOLLOWING THE EFFECTIVE DATE, THE REGISTRATION STATEMENT IS NOT EFFECTIVE
OR THE PROSPECTUS INCLUDED IN THE REGISTRATION STATEMENT MAY NOT BE USED BY THE
PURCHASERS FOR THE RESALE OF THE SHARES AND WARRANT SHARES.
(B)
FROM THE DATE HEREOF UNTIL THE ONE YEAR ANNIVERSARY OF THE
EFFECTIVE DATE, THE COMPANY SHALL BE PROHIBITED FROM EFFECTING OR ENTERING INTO
AN AGREEMENT TO EFFECT ANY SUBSEQUENT FINANCING INVOLVING A VARIABLE RATE
TRANSACTION.
"VARIABLE RATE TRANSACTION" MEANS A TRANSACTION IN WHICH THE
COMPANY ISSUES OR SELLS (I) ANY DEBT OR EQUITY SECURITIES THAT ARE CONVERTIBLE
INTO, EXCHANGEABLE OR EXERCISABLE FOR, OR INCLUDE THE RIGHT TO RECEIVE
ADDITIONAL SHARES OF COMMON STOCK EITHER (A) AT A CONVERSION, EXERCISE OR
EXCHANGE RATE OR OTHER PRICE THAT IS BASED UPON AND/OR VARIES WITH THE TRADING
PRICES OF OR QUOTATIONS FOR THE SHARES OF COMMON STOCK AT ANY TIME AFTER THE
INITIAL ISSUANCE OF SUCH DEBT OR EQUITY SECURITIES, OR (B) WITH A CONVERSION,
EXERCISE OR EXCHANGE PRICE THAT IS SUBJECT TO BEING RESET AT SOME FUTURE DATE
AFTER THE INITIAL ISSUANCE OF SUCH DEBT OR EQUITY SECURITY OR UPON THE
OCCURRENCE OF SPECIFIED OR CONTINGENT EVENTS DIRECTLY OR INDIRECTLY RELATED TO
THE BUSINESS OF THE COMPANY OR THE MARKET FOR THE COMMON STOCK OR (II) ENTERS
INTO ANY AGREEMENT, INCLUDING, BUT NOT LIMITED TO, AN EQUITY LINE OF CREDIT,
WHEREBY THE COMPANY MAY SELL SECURITIES AT A FUTURE DETERMINED PRICE.
ANY
PURCHASER SHALL BE ENTITLED TO OBTAIN INJUNCTIVE RELIEF AGAINST THE COMPANY TO
PRECLUDE ANY SUCH ISSUANCE, WHICH REMEDY SHALL BE IN ADDITION TO ANY RIGHT TO
COLLECT DAMAGES.
(C)
NOTWITHSTANDING THE FOREGOING, THIS SECTION 4.13 SHALL NOT APPLY
IN RESPECT OF AN EXEMPT ISSUANCE, EXCEPT THAT NO VARIABLE RATE TRANSACTION SHALL
BE AN EXEMPT ISSUANCE.
4.14
SHORT SALES AND CONFIDENTIALITY AFTER THE DATE HEREOF. EACH
PURCHASER, SEVERALLY AND NOT JOINTLY WITH THE OTHER PURCHASERS, COVENANTS THAT
NEITHER IT NOR ANY AFFILIATE ACTING ON ITS BEHALF OR PURSUANT TO ANY
UNDERSTANDING WITH IT HAVE EXECUTED OR WILL EXECUTE ANY SHORT SALES DURING THE
PERIOD COMMENCING AT THE DISCUSSION TIME AND ENDING AT THE TIME THAT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT ARE FIRST PUBLICLY ANNOUNCED AS
DESCRIBED IN SECTION 4.4.
EACH PURCHASER, SEVERALLY AND NOT JOINTLY WITH THE
OTHER PURCHASERS, COVENANTS