REPRESENTING BENEFICIAL OWNERSHIP OF AT LEAST EIGHT PERCENT (8%) OF THE SHARES
OF COMMON STOCK, CALCULATED ON A FULLY-DILUTED BASIS (BUT EXCLUDING FROM THE
DENOMINATOR, SOLELY FOR PURPOSES OF THIS CLAUSE (II), ANY SECURITIES ISSUED
AFTER THE DATE HEREOF AND ON OR PRIOR TO THE DATE OF CALCULATION AS
CONSIDERATION IN ANY ACQUISITION BY THE COMPANY OR ANY OF ITS SUBSIDIARIES OF
ANOTHER BUSINESS ENTITY (OR A DIVISION OR MATERIAL PORTION OF THE ASSETS
THEREOF), WHETHER BY MERGER, ACQUISITION OF EQUITY, STOCK OR ASSETS,
CONSOLIDATION, REORGANIZATION OR OTHERWISE).
(7)
"SPECIAL PREEMPTIVE PERIOD" MEANS THE
PERIOD BEGINNING ON THE CLOSING DATE AND ENDING ON A SPECIAL TERMINATION EVENT.
(8)
"SPECIAL TERMINATION EVENT" MEANS THE
EARLIEST TO OCCUR OF (I) SUCH TIME AS THE INVESTOR HAS PURCHASED OFFERED
SECURITIES UPON EXERCISE(S) OF ITS SPECIAL PREEMPTIVE RIGHT WITH AN AGGREGATE
PURCHASE PRICE OF $5,000,000; (II) THE SECOND ANNIVERSARY OF THE DATE HEREOF;
AND (III) SUCH TIME AS THE INVESTOR AND/OR ITS AFFILIATES NO LONGER BENEFICIALLY
OWN, IN THE AGGREGATE, AT LEAST SEVENTY-FIVE PERCENT (75%) OF THE PURCHASED
SHARES (I.E., 2,142,857 SHARES OF COMMON STOCK) (ADJUSTED TO TAKE INTO ACCOUNT
ANY STOCK SPLITS, REVERSE STOCK SPLITS, STOCK DIVIDENDS, RECAPITALIZATIONS,
CONVERSIONS AND THE LIKE).
(9)
"SUBSEQUENT PLACEMENT" MEANS ANY ACTION TO
OFFER, SELL, GRANT ANY OPTION TO PURCHASE, OR OTHERWISE DISPOSE OF (OR ANNOUNCE
ANY OFFER, SALE, GRANT OR ANY OPTION TO PURCHASE OR OTHER DISPOSITION OF) ANY OF
THE EQUITY OR EQUITY EQUIVALENT SECURITIES OF THE COMPANY OR ITS SUBSIDIARIES,
INCLUDING WITHOUT LIMITATION ANY DEBT, PREFERRED STOCK OR OTHER INSTRUMENT OR
SECURITY THAT IS, AT ANY TIME DURING ITS LIFE AND UNDER ANY CIRCUMSTANCES,
CONVERTIBLE INTO OR EXCHANGEABLE OR EXERCISABLE FOR SHARES OF COMMON STOCK OR
COMMON STOCK EQUIVALENTS.
(III)
SO LONG AS EITHER THE REGULAR PREEMPTIVE
PERIOD AND/OR THE SPECIAL PREEMPTIVE PERIOD IS IN EFFECT, THE COMPANY WILL NOT,
DIRECTLY OR INDIRECTLY, EFFECT ANY SUBSEQUENT PLACEMENT UNLESS THE COMPANY SHALL
HAVE FIRST COMPLIED WITH THIS SECTION 4(L) IN ORDER TO ENABLE THE INVESTOR TO
EXERCISE THE REGULAR PREEMPTIVE RIGHT AND/OR SPECIAL PREEMPTIVE RIGHT, AS
APPLICABLE.
(1)
PRIOR TO MAKING ANY SUBSEQUENT PLACEMENT,
THE COMPANY SHALL DELIVER TO THE INVESTOR A WRITTEN NOTICE (THE "OFFER NOTICE")
OF ANY PROPOSED OR INTENDED ISSUANCE OR SALE OR EXCHANGE (THE "OFFER") OF THE
SECURITIES BEING OFFERED (THE "OFFERED SECURITIES") IN SUCH SUBSEQUENT
PLACEMENT, WHICH OFFER NOTICE SHALL (W) IDENTIFY AND DESCRIBE THE OFFERED
SECURITIES, (X) DESCRIBE THE PRICE AND OTHER TERMS UPON WHICH THEY ARE TO BE
ISSUED, SOLD OR EXCHANGED, AND THE NUMBER OR AMOUNT OF THE OFFERED SECURITIES TO
BE ISSUED, SOLD OR EXCHANGED, (Y) IDENTIFY THE PERSONS OR ENTITIES (IF KNOWN) TO
WHICH OR
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WITH WHICH THE OFFERED SECURITIES ARE TO BE OFFERED, ISSUED, SOLD OR EXCHANGED
AND (Z) OFFER TO ISSUE AND SELL TO OR EXCHANGE WITH THE INVESTOR THE NUMBER OF
OFFERED SECURITIES WHICH IT IS ENTITLED TO PURCHASE UNDER THIS SECTION 4(L).
(2)
TO ACCEPT AN OFFER, IN WHOLE OR IN PART,
THE INVESTOR MUST DELIVER A WRITTEN NOTICE