ISSUANCE BY THE
COMPANY OF RIGHTS, WARRANTS OR OPTIONS TO PURCHASE COMMON STOCK OR SECURITIES
CONVERTIBLE INTO COMMON STOCK SHALL BE DEEMED TO BE THE SALE OR ISSUANCE OF
SHARES OF COMMON STOCK (IN WHICH EVENT THE SUBSEQUENT EXERCISE THEREOF SHALL NOT
BE DEEMED TO BE A SEPARATE SALE OR ISSUANCE FOR PURPOSES OF THIS SECTION 3), AND
THE CONSIDERATION THEREFOR SHALL CONSIST OF THE CONSIDERATION RECEIVED BY THE
COMPANY UPON ISSUANCE OF SUCH RIGHTS,
5
WARRANTS, OPTIONS OR CONVERTIBLE SECURITIES PLUS ANY CONSIDERATION TO BE
RECEIVED UPON THE EXERCISE OR CONVERSION THEREOF.
(E)
WHEN ANY ADJUSTMENT IS REQUIRED TO BE MADE IN THE NUMBER OF SHARES
OR OTHER SECURITIES OR PROPERTY PURCHASABLE UPON EXERCISE OF THE WARRANT, THE
COMPANY WILL PROMPTLY DETERMINE THE NEW NUMBER OF SUCH SHARES OR OTHER
SECURITIES OR PROPERTY PURCHASABLE UPON EXERCISE OF THE WARRANT AND (I) PREPARE
AND RETAIN ON FILE A STATEMENT DESCRIBING IN REASONABLE DETAIL THE METHOD USED
IN ARRIVING AT THE NEW NUMBER OF SUCH SHARES OR OTHER SECURITIES OR PROPERTY
PURCHASABLE UPON EXERCISE OF THE WARRANT AND (II) CAUSE A COPY OF SUCH STATEMENT
TO BE MAILED TO THE WARRANTHOLDER WITHIN THIRTY (30) DAYS AFTER THE DATE OF THE
EVENT GIVING RISE TO THE ADJUSTMENT.
(F)
NO FRACTIONAL SHARES OF COMMON STOCK OR OTHER SECURITIES WILL BE
ISSUED IN CONNECTION WITH THE EXERCISE OF THE WARRANT, BUT THE COMPANY WILL PAY,
IN LIEU OF FRACTIONAL SHARES, A CASH PAYMENT THEREFOR ON THE BASIS OF THE MEAN
BETWEEN THE BID AND ASKED PRICES OF THE COMMON STOCK IN THE OVER THE COUNTER
MARKET OR THE CLOSING PRICE ON A NATIONAL SECURITIES EXCHANGE OR NASDAQ ON THE
DAY IMMEDIATELY PRIOR TO EXERCISE.
(G)
IF SECURITIES OF THE COMPANY OR SECURITIES OF ANY SUBSIDIARY OF
THE COMPANY ARE DISTRIBUTED PRO RATA TO HOLDERS OF COMMON STOCK (OTHER THAN
SHARES ISSUED PURSUANT TO THE RIGHTS OFFERING), SUCH NUMBER OF SUCH SECURITIES
WILL BE DISTRIBUTED TO THE WARRANTHOLDER OR HIS ASSIGNEE UPON EXERCISE OF THIS
WARRANT AS THE WARRANTHOLDER OR ASSIGNEE WOULD HAVE BEEN ENTITLED TO IF THE
PORTION OF THE WARRANT EVIDENCED BY THIS WARRANT CERTIFICATE HAD BEEN EXERCISED
PRIOR TO THE RECORD DATE FOR SUCH DISTRIBUTION.
THE PROVISIONS WITH RESPECT TO
ADJUSTMENT OF THE COMMON STOCK PROVIDED IN THIS SECTION 3 WILL ALSO APPLY TO THE
SECURITIES TO WHICH THE WARRANTHOLDER OR HIS ASSIGNEE IS ENTITLED UNDER THIS
SUBSECTION 3(G).
(H)
IN THE EVENT (I) THE COMPANY ESTABLISHES A RECORD DATE TO
DETERMINE THE HOLDERS OF ANY CLASS OF SECURITIES WHO ARE ENTITLED TO RECEIVE ANY
DIVIDEND OR OTHER DISTRIBUTION OR (II) THERE OCCURS ANY CHANGE IN THE COMMON
STOCK THROUGH MERGER, CONSOLIDATION, RECLASSIFICATION, REORGANIZATION, PARTIAL
OR COMPLETE LIQUIDATION, PURCHASE OF SUBSTANTIALLY ALL OF THE ASSETS OF THE
COMPANY OR OTHER CHANGE IN THE CAPITAL STRUCTURE OF THE COMPANY, THE COMPANY
SHALL GIVE TO THE HOLDER HEREOF A NOTICE SPECIFYING (A) THE DATE OF SUCH RECORD
DATE FOR THE PURPOSE OF SUCH DIVIDEND OR DISTRIBUTION AND A DESCRIPTION OF SUCH
DIVIDEND OR