in Section 1(b) below).
SECTION 1.
(A)
SECURITIES PURCHASE AGREEMENT.
THIS
WARRANT WAS ISSUED PURSUANT TO THAT CERTAIN SECURITIES PURCHASE AGREEMENT, DATED
AS OF EVEN DATE HEREWITH, BETWEEN THE COMPANY AND STERLING SC INVESTOR, LLC (AS
SUCH AGREEMENT MAY BE AMENDED, RESTATED, MODIFIED OR SUPPLEMENTED AND IN EFFECT
FROM TIME TO TIME, THE "PURCHASE AGREEMENT") OR ISSUED IN EXCHANGE OR
SUBSTITUTION THEREFOR OR REPLACEMENT THEREOF.
EACH CAPITALIZED TERM USED, AND
NOT OTHERWISE DEFINED HEREIN, SHALL HAVE THE MEANING ASCRIBED THERETO IN THE
PURCHASE AGREEMENT.
(B)
DEFINITIONS.
THE FOLLOWING WORDS AND
TERMS AS USED IN THIS WARRANT SHALL HAVE THE FOLLOWING MEANINGS:
(I)
"COMMON STOCK" MEANS (I) THE COMPANY'S
COMMON STOCK, PAR VALUE $0.01 PER SHARE, AND (II) ANY CAPITAL STOCK INTO WHICH
SUCH COMMON STOCK SHALL HAVE BEEN CHANGED OR ANY CAPITAL STOCK RESULTING FROM A
RECLASSIFICATION OF SUCH COMMON STOCK.
(II)
"CONVERTIBLE SECURITIES" MEANS ANY STOCK
OR SECURITIES (OTHER THAN OPTIONS) DIRECTLY OR INDIRECTLY CONVERTIBLE INTO OR
EXCHANGEABLE OR EXERCISABLE FOR COMMON STOCK.
(III)
"EXPIRATION DATE" MEANS THE DATE THAT IS
FIVE (5) YEARS AFTER THE WARRANT DATE (AS DEFINED IN SECTION 12) OR, IF SUCH
DATE DOES NOT FALL ON A BUSINESS DAY, THEN THE NEXT BUSINESS DAY.
(IV)
"OPTIONS" MEANS ANY RIGHTS, WARRANTS OR
OPTIONS TO SUBSCRIBE FOR OR PURCHASE ANY COMMON STOCK OR CONVERTIBLE SECURITIES.
(V)
"ORGANIC CHANGE" MEANS ANY RECAPITALIZATION,
REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER, SALE OF ALL OR
SUBSTANTIALLY ALL OF THE COMPANY'S ASSETS TO ANOTHER PERSON OR OTHER TRANSACTION
THAT IS EFFECTED IN SUCH A WAY THAT HOLDERS OF COMMON STOCK ARE ENTITLED TO
RECEIVE (EITHER DIRECTLY OR UPON SUBSEQUENT LIQUIDATION) STOCK, SECURITIES, CASH
OR ASSETS WITH RESPECT TO OR IN EXCHANGE FOR COMMON STOCK OTHER THAN PAYMENT OF
CASH DIVIDENDS.
(VI)
"PERSON" MEANS AN INDIVIDUAL, A LIMITED
LIABILITY COMPANY, A PARTNERSHIP, A JOINT VENTURE, A CORPORATION, A TRUST, AN
UNINCORPORATED ORGANIZATION OR A GOVERNMENT OR ANY DEPARTMENT OR AGENCY THEREOF
OR ANY OTHER LEGAL ENTITY.
(VII)
"REGISTRATION RIGHTS AGREEMENT" MEANS THAT
CERTAIN REGISTRATION RIGHTS AGREEMENT, DATED AS OF EVEN DATE HEREWITH, BETWEEN
THE COMPANY AND STERLING SC INVESTOR, LLC, AS SUCH AGREEMENT MAY BE AMENDED,
RESTATED OR MODIFIED AND IN EFFECT FROM TIME TO TIME.
(VIII)
"SECURITIES ACT" MEANS THE SECURITIES ACT OF 1933,
AS AMENDED, OR ANY SUCCESSOR THERETO.
(IX)
"TRADING DAY" MEANS ANY DAY ON WHICH THE
COMMON STOCK IS TRADED ON THE PRINCIPAL MARKET; PROVIDED THAT "TRADING DAY"
SHALL NOT INCLUDE ANY DAY ON WHICH THE COMMON STOCK IS SCHEDULED TO TRADE, OR
ACTUALLY TRADES, ON SUCH EXCHANGE OR MARKET FOR LESS THAN 4.5 HOURS.
(X)
"WARRANT" MEANS THIS WARRANT AND ALL
WARRANTS ISSUED IN EXCHANGE, TRANSFER OR REPLACEMENT THEREOF PURSUANT TO THE
TERMS OF THIS WARRANT.
(XI)
"WARRANT EXERCISE PRICE" SHALL BE EQUAL TO,
WITH RESPECT TO ANY WARRANT SHARE, $0.01, SUBJECT TO ADJUSTMENT AS PROVIDED IN
SECTION 8 OF THIS WARRANT.
(XII)
"WEIGHTED AVERAGE PRICE" MEANS, FOR ANY
SECURITY AS OF ANY DATE, THE DOLLAR VOLUME-WEIGHTED AVERAGE PRICE FOR SUCH
SECURITY ON ITS PRINCIPAL MARKET DURING THE