("INITIATING INVESTORS") INTEND TO DISTRIBUTE THE REGISTRABLE
SECURITIES COVERED BY THEIR REQUEST BY MEANS OF AN UNDERWRITING, THEY SHALL SO
ADVISE THE COMPANY AS A PART OF THEIR REQUEST MADE PURSUANT TO THIS
SECTION 2(B) AND THE COMPANY SHALL INCLUDE SUCH INFORMATION IN THE WRITTEN
NOTICE REFERRED TO IN SECTION 2(A).
THE UNDERWRITER WILL BE SELECTED BY THE
COMPANY AND SHALL BE ACCEPTABLE TO A MAJORITY IN INTEREST OF THE INITIATING
INVESTORS.
IN SUCH EVENT, THE RIGHT OF ANY INVESTOR TO INCLUDE ITS REGISTRABLE
SECURITIES IN SUCH REGISTRATION SHALL BE CONDITIONED UPON SUCH INVESTOR'S
PARTICIPATION IN SUCH UNDERWRITING AND THE INCLUSION OF SUCH INVESTOR'S
REGISTRABLE SECURITIES IN THE UNDERWRITING (UNLESS OTHERWISE MUTUALLY AGREED BY
A MAJORITY IN INTEREST OF THE INITIATING INVESTORS AND SUCH INVESTOR) TO THE
EXTENT PROVIDED HEREIN.
ALL INVESTORS PROPOSING TO DISTRIBUTE THEIR SECURITIES
THROUGH SUCH UNDERWRITING SHALL, TOGETHER WITH THE COMPANY, ENTER INTO AN
UNDERWRITING AGREEMENT IN CUSTOMARY FORM WITH THE UNDERWRITER OR UNDERWRITERS
SELECTED FOR SUCH UNDERWRITING.
NOTWITHSTANDING ANY OTHER PROVISION OF THIS
SECTION 2(B), IF THE UNDERWRITER ADVISES THE INITIATING INVESTORS IN WRITING
THAT MARKETING FACTORS REQUIRE A LIMITATION OF THE NUMBER OF SHARES TO BE
UNDERWRITTEN, THEN THE INITIATING INVESTORS SHALL SO ADVISE ALL INVESTORS
HOLDING REGISTRABLE SECURITIES WHICH WOULD OTHERWISE BE UNDERWRITTEN PURSUANT
HERETO, AND THE NUMBER OF SHARES OF REGISTRABLE SECURITIES THAT MAY BE INCLUDED
IN THE UNDERWRITING SHALL BE ALLOCATED AMONG ALL HOLDERS THEREOF, INCLUDING THE
INITIATING INVESTORS, IN PROPORTION (AS NEARLY AS PRACTICABLE) TO THE AMOUNT OF
REGISTRABLE SECURITIES OF THE COMPANY OWNED BY EACH HOLDER; PROVIDED, HOWEVER,
THAT THE NUMBER OF SHARES OF REGISTRABLE SECURITIES TO BE INCLUDED IN SUCH
UNDERWRITING SHALL NOT BE REDUCED UNLESS ALL OTHER SECURITIES ARE FIRST ENTIRELY
EXCLUDED FROM THE UNDERWRITING.
IF ANY INVESTOR WOULD THUS BE ENTITLED TO
INCLUDE MORE SECURITIES THAN SUCH INVESTOR REQUESTED TO BE REGISTERED, THE
EXCESS SHALL BE ALLOCATED AMONG THE OTHER REMAINING REQUESTING INVESTORS IN THE
MANNER DESCRIBED IN THE IMMEDIATELY PRECEDING SENTENCE.
(C)
NOTWITHSTANDING THE FOREGOING, IF THE
COMPANY SHALL FURNISH TO INVESTORS REQUESTING A REGISTRATION STATEMENT PURSUANT
TO THIS SECTION 2, A CERTIFICATE SIGNED BY THE CHIEF EXECUTIVE OFFICER OF THE
COMPANY STATING THAT IN THE GOOD FAITH JUDGMENT OF THE BOARD OF DIRECTORS OF THE
COMPANY, IT WOULD BE SERIOUSLY DETRIMENTAL TO THE COMPANY AND ITS STOCKHOLDERS
FOR SUCH REGISTRATION STATEMENT TO BE FILED OWING TO A MATERIAL PENDING
TRANSACTION OR
3
DEVELOPMENT AND IT IS THEREFORE ESSENTIAL TO DEFER THE FILING OF SUCH
REGISTRATION STATEMENT, THE COMPANY SHALL HAVE THE RIGHT TO DEFER TAKING ACTION
WITH RESPECT TO SUCH FILING FOR A PERIOD OF NOT MORE THAN NINETY (90) DAYS AFTER
RECEIPT OF THE REQUEST OF THE INITIATING INVESTORS; PROVIDED, HOWEVER, THAT THE
COMPANY MAY NOT UTILIZE THIS RIGHT MORE THAN ONCE IN ANY TWELVE (12)- MONTH
PERIOD.
(D)
IN ADDITION, THE COMPANY SHALL NOT BE
OBLIGATED TO EFFECT, OR TO TAKE ANY ACTION TO EFFECT, ANY REGISTRATION PURSUANT
TO THIS SECTION 2:
(I)
IN ANY PARTICULAR JURISDICTION IN WHICH
THE COMPANY