ACT, THE BREACH OF WHICH COULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT OR WOULD PROHIBIT OR OTHERWISE INTERFERE WITH THE
ABILITY OF THE COMPANY TO ENTER INTO AND PERFORM ANY OF ITS OBLIGATIONS UNDER
THIS AGREEMENT THE REGISTRATION RIGHTS AGREEMENT EXECUTED BY COMPANY IN FAVOR OF
LAURUS IN ANY MATERIAL RESPECT.
LAURUS OR ANY OF ITS AFFILIATES AND INVESTMENT PARTNERS HAS NOT, WILL NOT AND
WILL NOT CAUSE ANY PERSON OR ENTITY, DIRECTLY OR INDIRECTLY, TO ENGAGE IN "SHORT
SALES" OF THE COMPANY'S COMMON STOCK OR ANY OTHER HEDGING STRATEGIES AS LONG AS
THE MINIMUM BORROWING NOTE SHALL BE OUTSTANDING.
COVENANTS.
COMPANY COVENANTS AS FOLLOWS:
COMPANY WILL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF LAURUS, CHANGE (I) ITS
NAME AS IT APPEARS IN THE OFFICIAL FILINGS IN THE STATE OF ITS INCORPORATION OR
FORMATION, (II) THE TYPE OF LEGAL ENTITY IT IS, (III) ITS ORGANIZATION
IDENTIFICATION NUMBER, IF ANY, ISSUED BY ITS STATE OF INCORPORATION, (IV) ITS
STATE OF INCORPORATION OR (V) AMEND ITS CERTIFICATE OF INCORPORATION, BY-LAWS OR
OTHER ORGANIZATIONAL DOCUMENT.
THE OPERATION OF COMPANY'S BUSINESS IS AND WILL CONTINUE TO BE IN COMPLIANCE IN
ALL MATERIAL RESPECTS WITH ALL APPLICABLE FEDERAL, STATE AND LOCAL LAWS, RULES
AND ORDINANCES, INCLUDING TO ALL LAWS, RULES, REGULATIONS AND ORDERS RELATING TO
TAXES, PAYMENT AND WITHHOLDING OF PAYROLL TAXES, EMPLOYER AND EMPLOYEE
CONTRIBUTIONS AND SIMILAR ITEMS, SECURITIES, EMPLOYEE RETIREMENT AND WELFARE
BENEFITS, EMPLOYEE HEALTH SAFETY AND ENVIRONMENTAL MATTERS.
COMPANY WILL PAY OR DISCHARGE WHEN DUE ALL TAXES, ASSESSMENTS AND GOVERNMENTAL
CHARGES OR LEVIES IMPOSED UPON COMPANY OR ANY OF THE COLLATERAL UNLESS SUCH
AMOUNTS ARE BEING DILIGENTLY CONTESTED IN GOOD FAITH BY APPROPRIATE PROCEEDINGS
PROVIDED THAT (I) ADEQUATE RESERVES WITH RESPECT THERETO ARE MAINTAINED ON THE
BOOKS OF COMPANY IN CONFORMITY WITH GAAP AND (II) THE RELATED LIEN SHALL HAVE NO
EFFECT ON THE PRIORITY OF THE LIENS IN FAVOR OF LAURUS OR THE VALUE OF THE
ASSETS IN WHICH LAURUS HAS A LIEN.
COMPANY WILL PROMPTLY INFORM LAURUS IN WRITING OF: (I) THE COMMENCEMENT OF ALL
PROCEEDINGS AND INVESTIGATIONS BY OR BEFORE AND/OR THE RECEIPT OF ANY NOTICES
FROM, ANY GOVERNMENTAL OR NONGOVERNMENTAL BODY AND ALL ACTIONS AND PROCEEDINGS
IN ANY COURT OR BEFORE ANY ARBITRATOR AGAINST OR IN ANY WAY CONCERNING ANY EVENT
WHICH COULD REASONABLE BE EXPECTED TO HAVE SINGLY OR IN THE AGGREGATE, A
MATERIAL ADVERSE EFFECT; (II) ANY AMENDMENT OF COMPANY'S CERTIFICATE OF
INCORPORATION, BY-LAWS OR OTHER ORGANIZATIONAL DOCUMENT; (III) ANY CHANGE WHICH
HAS HAD OR COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; (IV)
ANY EVENT OF DEFAULT OR DEFAULT; (V) ANY DEFAULT OR ANY EVENT WHICH WITH THE
PASSAGE OF TIME OR GIVING OF NOTICE OR BOTH WOULD CONSTITUTE A DEFAULT UNDER ANY
AGREEMENT FOR THE PAYMENT OF MONEY TO WHICH COMPANY IS A PARTY OR BY WHICH
COMPANY OR ANY OF COMPANY'S PROPERTIES MAY BE BOUND THE BREACH OF WHICH WOULD
HAVE A MATERIAL ADVERSE EFFECT AND (VI) ANY CHANGE IN COMPANY'S NAME OR ANY
OTHER NAME USED IN