OF
WARRANT SHARES BEING ACQUIRED UPON AN EXERCISE, THEN THE COMPANY SHALL AS SOON
AS PRACTICABLE AND IN NO EVENT LATER THAN THREE BUSINESS DAYS AFTER ANY EXERCISE
AND AT ITS OWN EXPENSE, ISSUE SUBJECT TO SUCH PRIOR EXERCISE A NEW WARRANT (IN
ACCORDANCE WITH SECTION 7(D)) REPRESENTING THE RIGHT TO PURCHASE THE NUMBER OF
WARRANT SHARES PURCHASABLE IMMEDIATELY PRIOR TO SUCH EXERCISE UNDER THIS
WARRANT, LESS THE NUMBER OF WARRANT SHARES WITH RESPECT TO WHICH THIS WARRANT IS
EXERCISED. NO FRACTIONAL SHARES
2
OF COMMON STOCK ARE TO BE ISSUED UPON THE EXERCISE OF THIS WARRANT, BUT RATHER
THE NUMBER OF SHARES OF COMMON STOCK TO BE ISSUED SHALL BE ROUNDED UP TO THE
NEAREST WHOLE NUMBER.
THE COMPANY SHALL PAY ANY AND ALL TAXES WHICH MAY BE
PAYABLE WITH RESPECT TO THE ISSUANCE AND DELIVERY OF WARRANT SHARES UPON
EXERCISE OF THIS WARRANT
(B)
EXERCISE PRICE.
FOR PURPOSES OF THIS WARRANT, "EXERCISE PRICE" MEANS
$0.38, SUBJECT TO ADJUSTMENT AS PROVIDED HEREIN.
(C)
COMPANY'S FAILURE TO TIMELY DELIVER SECURITIES.
IF WITHIN THREE (3)
TRADING DAYS AFTER THE COMPANY'S RECEIPT OF THE FACSIMILE COPY OF A EXERCISE
NOTICE THE COMPANY SHALL FAIL TO ISSUE AND DELIVER A CERTIFICATE TO THE HOLDER
AND REGISTER SUCH SHARES OF COMMON STOCK ON THE COMPANY'S SHARE REGISTER OR
CREDIT THE HOLDER'S BALANCE ACCOUNT WITH DTC FOR THE NUMBER OF SHARES OF COMMON
STOCK TO WHICH THE HOLDER IS ENTITLED UPON THE HOLDER'S EXERCISE HEREUNDER, AND
IF ON OR AFTER SUCH TRADING DAY THE HOLDER PURCHASES (IN AN OPEN MARKET
TRANSACTION OR OTHERWISE) SHARES OF COMMON STOCK TO DELIVER IN SATISFACTION OF A
SALE BY THE HOLDER OF SHARES OF COMMON STOCK ISSUABLE UPON SUCH EXERCISE THAT
THE HOLDER ANTICIPATED RECEIVING FROM THE COMPANY (A "BUY-IN"), THEN THE COMPANY
SHALL, WITHIN THREE (3) TRADING DAYS AFTER THE HOLDER'S REQUEST AND IN THE
HOLDER'S DISCRETION, EITHER (I) PAY CASH TO THE HOLDER IN AN AMOUNT EQUAL TO THE
HOLDER'S TOTAL PURCHASE PRICE (INCLUDING BROKERAGE COMMISSIONS, IF ANY) FOR THE
SHARES OF COMMON STOCK SO PURCHASED (THE "BUY-IN PRICE"), AT WHICH POINT THE
COMPANY'S OBLIGATION TO DELIVER SUCH CERTIFICATE (AND TO ISSUE SUCH WARRANT
SHARES) SHALL TERMINATE, OR (II) PROMPTLY HONOR ITS OBLIGATION TO DELIVER TO THE
HOLDER A CERTIFICATE OR CERTIFICATES OR IF LEGENDS ARE NOT REQUIRED TO BE PLACED
ON CERTIFICATES OF COMMON STOCK PURSUANT TO THE SECURITIES PURCHASE AGREEMENT,
PROVIDED THAT THE TRANSFER AGENT IS PARTICIPATING IN DTC FAST AUTOMATED
SECURITIES TRANSFER PROGRAM, UPON THE REQUEST OF THE HOLDER, CREDIT SUCH
AGGREGATE NUMBER OF WARRANT SHARES TO WHICH THE HOLDER IS ENTITLED PURSUANT TO
SUCH EXERCISE TO THE HOLDER'S OR ITS DESIGNEE'S BALANCE ACCOUNT WITH DTC THROUGH
ITS DEPOSIT WITHDRAWAL AGENT COMMISSION SYSTEM AND PAY CASH TO THE HOLDER IN AN
AMOUNT EQUAL TO THE EXCESS (IF ANY) OF THE BUY-IN PRICE OVER THE PRODUCT OF (A)
SUCH NUMBER OF SHARES OF COMMON STOCK, TIMES (B) THE CLOSING BID PRICE ON THE
DATE OF EXERCISE.
(D)
CASHLESS EXERCISE.
NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO