Document:

ex4_19.htm

    
      

    

    
      

    

    Exhibit
      4.19

     

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT"), OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
      DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
      STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL
      TO
      THE HOLDER OF THE SECURITIES (UNLESS THE ISSUER IN ITS SOLE DISCRETION
      DETERMINES TO USE ITS OWN COUNSEL), WITH ANY SUCH COUNSEL TO THE HOLDER AND
      ANY
      SUCH OPINION OF SUCH COUNSEL TO BE REASONABLY ACCEPTABLE TO THE ISSUER, THAT
      REGISTRATION UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE
      STATE SECURITIES LAWS IS NOT REQUIRED.

    

    WARRANT
      TO PURCHASE

    

    SHARES
      OF
      COMMON STOCK

    

    OF

    

    CHEMBIO
      DIAGNOSTICS, INC.

    

    Expires
      May 4, 2009

    

    
      	
              No.:

            	
              Number
                of Shares:

            
	
              Original
                Date of Issuance:  May 5, 2004

            	
              Reissuance
                Date:  December 19,
                2007

            

    

    

    

    FOR
      VALUE
      RECEIVED, subject to the provisions hereinafter set forth, the undersigned,
      Chembio Diagnostics, Inc., a Nevada corporation (together with its successors
      and assigns, the "Issuer"), hereby certifies that ________ or its
      registered assigns is entitled to subscribe for and purchase, during the Term
      (as hereinafter defined), up to ________ (__________) shares (subject to
      adjustment as hereinafter provided) of the duly authorized, validly issued,
      fully paid and non-assessable Common Stock of the Issuer, at an exercise price
      per share equal to the Exercise Price then in effect, subject, however, to
      the
      provisions and upon the terms and conditions hereinafter set
      forth.  Capitalized terms used in this Warrant and not otherwise
      defined herein shall have the respective meanings specified in Section 6
      hereof.

    

    1.           Term.  The
      term of this Warrant shall commence on ______ and shall expire at 5:00 p.m.,
      eastern time, on May 4, 2009 (such period being the "Term").

    

    2.           Method
      of Exercise Payment; Issuance of New Warrant; Transfer and
      Exchange.

    

    (a)           Time
      of Exercise.  The purchase rights represented by this Warrant may
      be exercised in whole or in part anytime during the Term.

    

    (b)           Method
      of Exercise.  The Holder hereof may exercise this Warrant, in
      whole or in part, by the surrender of this Warrant (with the exercise form
      attached hereto duly executed) at the principal office of the Issuer, and by
      the
      payment to the Issuer of an amount of consideration therefor equal to the
      Exercise Price in effect on the date of such exercise multiplied by the number
      of shares of Warrant Stock with respect to which this Warrant is then being
      exercised, payable at
      such Holder's election (i) by certified or official bank check or by
      wire transfer to an account designated by the Issuer, or
      (ii) by "cashless exercise" in accordance with the provisions of section
      (2)(c).

     

    (c)           Cashless
      Exercise.  (i) At the option of the Holder, this Warrant may be
      exercised by means of a “cashless exercise” (a “Cashless Exercise”) in which the
      Holder shall be entitled to receive a certificate for the number
      of  shares of Warrant Stock equal to the quotient obtained by dividing
      [(A-B) (X)] by (A), where:

     

    (A)
      = the
      VWAP for the ten-Trading Day period that ends on the first Trading Day
      immediately preceding the date of such election;

     

    (B)
      = the
      Exercise Price of this Warrant in effect on the date of exercise, as adjusted;
      and

     

    (X)
      = the
      number of shares of Warrant Stock issuable upon exercise of this Warrant in
      accordance with the terms of this Warrant by means of a cash exercise rather
      than a cashless exercise.

     

    (ii)           Notwithstanding
      anything herein to the contrary, for any Notice of Exercise Form dated on the
      Plan Closing Date received from a Holder who exercises its warrants on cashless
      basis at $0.45 per share before 10:00p.m. ET on the Plan Closing Date, the
      value
      of (A) in the equation set forth in Section 2(c)(i) above shall be equal to
      the
      greater of $0.53 or the VWAP for the ten-Trading Day period that ends on the
      second Trading Day prior to the date of the Notice of Exercise
      Form.

     

    (iii)           Notwithstanding
      anything herein to the contrary, for any Notice of Exercise Form dated between
      and inclusive of the Plan Closing Date and the Final Plan Date received from
      a
      Holder who exercises at least 10% of all of such Holder's warrants and options
      for cash before 10:00p.m. ET on the Plan Closing Date the value of (A) in the
      equation set forth in Section 2(c)(i) above shall be equal to the greater of
      $0.53 or the VWAP for the ten-Trading Day period that ends on the second Trading
      Day prior to the date of the Notice of Exercise Form. 

     

    (iv)           Notwithstanding
      anything herein to the contrary, a Holder who does not exercise (i) at least
      10%
      of all of such Holder's warrants and options issued by the Company for cash
      at
      an exercise price of $0.40 per share before 10:00p.m. ET on the Plan Closing
      Date, or (ii) its warrants on cashless basis at $0.45 per share by 10:00p.m.
      ET
      on the Plan Closing Date, shall not be permitted to exercise its Warrants on
      a
      cashless basis pursuant to Section 2(c)(i) above until April 1,
      2008.

     

    (d)           Issuance
      of Stock Certificates.  In the event of any exercise of the rights
      represented by this Warrant in accordance with and subject to the terms and
      conditions hereof, (i) certificates for the shares of Warrant Stock so purchased
      shall be dated the date of such exercise and delivered to the Holder hereof
      within a reasonable time, after such exercise, and (ii) unless this Warrant
      has
      expired, a new Warrant representing the number of shares of Warrant Stock,
      if
      any, with respect to which this Warrant shall not then have been exercised
      (less
      any amount thereof which shall have been canceled in payment or partial payment
      of the Exercise Price as hereinabove provided) shall also be issued to the
      Holder hereof at the Issuer's expense within such time.

    

    (e)           Transferability
      of Warrant.  Subject to Section 2(f), this Warrant may be
      transferred by a Holder without the consent of the Issuer.  If
      transferred pursuant to this paragraph and subject to the provisions of
      subsection (f) of this Section 2, this Warrant may be transferred on the books
      of the Issuer by the Holder hereof in person or by duly authorized attorney,
      upon surrender of this Warrant at the principal office of the Issuer, properly
      endorsed (by the Holder executing an assignment in the form attached hereto)
      and
      upon payment of any necessary transfer tax or other governmental charge imposed
      upon such transfer.  This Warrant is exchangeable at the principal
      office of the Issuer for Warrants for the purchase of the same aggregate number
      of shares of Warrant Stock, each new Warrant to represent the right to purchase
      such number of shares of Warrant Stock as the Holder hereof shall designate
      at
      the time of such exchange.  All Warrants issued on transfers or
      exchanges shall be dated the Original Issue Date and shall be identical with
      this Warrant except as to the number of shares of Warrant Stock issuable
      pursuant thereto.

    

    (f)           Compliance
      with Securities Laws.

    

    (i)
      The
      Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant
      or
      the shares of Warrant Stock to be issued upon exercise hereof are being acquired
      solely for the Holder's own account and not as a nominee for any other party,
      and for investment, and that the Holder will not offer, sell or otherwise
      dispose of this Warrant or any shares of Warrant Stock to be issued upon
      exercise hereof except pursuant to an effective registration statement, or
      an
      exemption from registration, under the Securities Act and any applicable state
      securities laws.

    

    (ii)
      The
      Holder of this Warrant by acceptance hereof, represents that it has not been
      organized, reorganized or recapitalized specifically for the purpose of
      investing in the Issuer;  has sufficient business and financial
      knowledge and experience so as to be capable of evaluating the merits and risks
      of its investment in the Issuer; has had an opportunity to discuss the Issuer’s
      business, management and financial affairs with the Issuer’s management, and had
      all questions answered to its satisfaction.

    

    (iii)           This
      Warrant and all certificates representing shares of Warrant Stock issued upon
      exercise hereof shall be stamped or imprinted with a legend in substantially
      the
      following form:

    

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT"), OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
      DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
      STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL
      TO
      THE HOLDER OF THE SECURITIES (UNLESS THE ISSUER IN ITS SOLE DISCRETION
      DETERMINES TO USE ITS OWN COUNSEL), WITH ANY SUCH COUNSEL TO THE HOLDER AND
      ANY
      SUCH OPINION OF SUCH COUNSEL TO BE REASONABLY ACCEPTABLE TO THE ISSUER, THAT
      REGISTRATION UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE
      STATE SECURITIES LAWS IS NOT REQUIRED.

    

    3.           Loss,
      Theft, Destruction of Warrants.  Upon receipt of evidence
      satisfactory to the Issuer of the ownership of and the loss, theft, destruction
      or mutilation of any Warrant and, in the case of any such loss, theft or
      destruction, upon receipt of indemnity or security satisfactory to the Issuer
      or, in the case of any such mutilation, upon surrender and cancellation of
      such
      Warrant, the Issuer will make and deliver, in lieu of such lost, stolen,
      destroyed or mutilated Warrant, a new Warrant of like tenor and representing
      the
      right to purchase the same number of shares of Common Stock.

    

    4.           Adjustment
      of Exercise Price.  The price at which such shares may be
      purchased upon exercise of this Warrant shall be subject to adjustment from
      time
      to time as set forth in this Section 4.

    

    (a)           Subdivisions
      and Combinations.  If at any time the Issuer shall:

    

                          (i)           subdivide
      its outstanding shares of Common Stock into a larger number of shares of Common
      Stock, or

    

                          (ii)           combine
      its outstanding shares of Common Stock into a smaller number of shares of Common
      Stock,

    

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      immediately after the occurrence of any such event shall be adjusted to equal
      the number of shares of Common Stock which a record holder of the same number
      of
      shares of Common Stock for which this Warrant is exercisable immediately prior
      to the occurrence of such event would own or be entitled to receive after the
      happening of such event, and (2) the Exercise Price then in effect shall be
      adjusted to equal (A) the Exercise Price then in effect multiplied by the number
      of shares of Common Stock for which this Warrant is exercisable immediately
      prior to the adjustment divided by (B) the number of shares of Common Stock
      for
      which this Warrant is exercisable immediately after such
      adjustment.

    

    (b)  Form
      of Warrant after
      Adjustments.  The form of this Warrant need not be changed because
      of any adjustments in the Exercise Price or the number and kind of Securities
      purchasable upon the exercise of this Warrant.

    

    (c)   Notwithstanding
      any other provision set forth in this Section 4, no adjustment to the Exercise
      Price shall be required because of any issuance or sale of Additional Shares
      of
      Common Stock or Common Stock Equivalents in connection with the
      Plan.

    

    5.    Fractional
      Share.  No fractional shares of Warrant Stock will be issued in
      connection with any exercise of this Warrant.  As to the remaining
      fraction of a share, if any, which Holder would otherwise be entitled to
      purchase at the time, if any, that all whole shares of Warrant Stock available
      hereunder have been purchased purchase to the exercise of this Warrant, the
      Issuer shall pay a cash adjustment in respect of such final fraction in an
      amount equal to such fraction multiplied by the Exercise Price.  The
      Issuer shall pay this cash adjustment for fractional shares one time
      only.

    

    6.  Definitions.  For
      the purposes of this Warrant, the following terms have the following
      meanings:

    

    "Board"
      shall mean the Board of Directors of the Issuer.

    

    "Common
      Stock" means the Common Stock, par value $.01 per share, of the Issuer and
      any other Capital Stock into which such stock may hereafter be
      changed.

    

    “Final
      Plan Date” shall mean the date that is six months and twelve days after the
      Plan Closing Date.

     

    "Holders"
      mean the Persons who shall from time to time own any Warrant.  The
      term "Holder" means one of the Holders.

    

    "Issuer"
      means Chembio Diagnostics, Inc., a Nevada corporation, and its
      successors.

    

    "Original
      Issue Date" means «Year_Issued».

    

    "OTC
      Bulletin Board" means the
      over-the-counter electronic bulletin board.

    

    "Person"
      means an individual,
      corporation, limited liability company, partnership, joint stock company, trust,
      unincorporated organization, joint venture, Governmental Authority or other
      entity of whatever nature.

    

    “Plan”
      shall mean any action the Company takes, with any required approval of the
      holders thereof, on or before the Final Plan Date as contemplated by the Plan
      Summary and accompanying materials provided to holders on December 4, 2007, in
      connection with the reduction or other modification of terms of the Company’s
      then-outstanding preferred stock, warrants and options, including, but not
      limited to, actions the Company takes to (i) facilitate the conversion of the
      Series A, B and C Convertible Preferred Stock; (ii) reduce the exercise price
      of
      any of the Company’s outstanding warrants or options; (iii) offer the holders of
      the Company’s warrants and options the opportunity to exercise such warrants and
      options on a cash and/or cashless basis; and (iv) make other amendments to
      the
      documents governing these securities to effect these modifications, and to
      facilitate the conversion and exercise of these securities.

     

    “Plan
      Closing Date” shall be December 19, 2007.

     

    "Securities"
      means any debt or equity securities of the Issuer, whether now or hereafter
      authorized, any instrument convertible into or exchangeable for Securities
      or a
      Security, and any option, warrant or other right to purchase or acquire any
      Security.  "Security" means one of the Securities.

    

    "Securities
      Act" means the Securities Act of 1933, as amended, or any similar federal
      statute then in effect.

    

    "Term"
      has the meaning specified in Section 1 hereof.

    

    "Trading
      Day" means (a) a day on which the Common Stock is traded on the OTC Bulletin
      Board, or (b) if the Common Stock is not traded on the OTC Bulletin Board,
      a day
      on which the Common Stock is quoted in the over-the-counter market as reported
      by the National Quotation Bureau Incorporated (or any similar organization
      or
      agency succeeding its functions of reporting prices); provided,
however, that in the event that the Common Stock is not listed or
      quoted
      as set forth in (a) or (b) hereof, then Trading Day shall mean any day except
      Saturday, Sunday and any day which shall be a legal holiday or a day on which
      banking institutions in the State of New York are authorized or required by
      law
      or other government action to close.

    

    "Warrants"
      means this Warrants, and any other warrants of like tenor issued in substitution
      or exchange for any thereof pursuant to the provisions hereof.

    

    "Exercise
      Price"
shall
      be
      as follows, except as may be adjusted from time to time as shall result from
      the
      adjustments specified in this Warrant:

     

    (i)           For
      the period 4:01p.m. eastern time (“ET”) through 9:59p.m. ET on the Plan
      Closing Date, $0.40 per share for all or any portion of this Warrant exercised
      for cash;

     

    (ii)           For
      the period 4:01p.m. ET through 9:59p.m. ET on the Plan Closing Date, $0.45
      per
      share for all or any portion of this Warrant exercised through a Cashless
      Exercise;

     

    (iii)           For
      the period beginning 10:00p.m. ET on the Plan Closing Date through 9:59p.m.
      ET
      on the Final Plan Date, $0.45 for all or any part of this Warrant exercised
      by a
      Holder who exercised at least 10% of all of such Holder’s warrants and options
      for cash at the Plan Closing Date;

     

    (iv)           For
      the period beginning 10:00p.m. ET on the Plan Closing Date, $___ per share
      for
      any Holder that did not exercise at least 10% of all of such Holder’s warrants
      and options for cash at an exercise price of $0.40 per share at the Plan Closing
      Date; and

     

    (v)           For
      the period beginning 10:00p.m. ET on the Final Plan Date, $___ per share for
      all
      or any portion of this Warrant that has not been exercised on or before 9:59p.m.
      ET on the Final Plan Date.

     

    "Warrant
      Stock" means Common Stock issuable upon exercise of any Warrant or Warrants
      or otherwise issuable pursuant to any Warrant or Warrants.

    

    7.           Amendment
      and Waiver.  Any term, covenant, agreement or condition in this
      Warrant may be amended, or compliance therewith may be waived (either generally
      or in a particular instance and either retroactively or prospectively), by
      a
      written instrument or written instruments executed by the Issuer and the
      majority of the Holders.

    

    8.           Governing
      Law.  THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN
      ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
      PRINCIPLES OF CONFLICTS OF LAW.

    

    9.           Notices.  Any
      and all notices or other communications or deliveries required or permitted
      to
      be provided hereunder shall be in writing and shall be deemed given and
      effective on the earlier of (i) the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile telephone number
      specified for notice prior to 5:00 p.m., eastern time, on a Trading Day, (ii)
      the Trading Day after the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile telephone number specified for
      notice later than 5:00 p.m., eastern time, on any date and earlier than 11:59
      p.m., eastern time, on such date, or (iii) actual receipt by the party to whom
      such notice is required to be given.  The addresses for such
      communications shall be with respect to the Holder of this Warrant or of Warrant
      Stock issued pursuant hereto, addressed to such Holder at its last known address
      or facsimile number appearing on the books of the Issuer maintained for such
      purposes, or with respect to the Issuer, addressed to:

    

    Chembio
      Diagnostics, Inc.

    3661
      Horseblock Road

    Medford,
      NY  11763

    Attention:
      Lawrence A. Siebert,
      President

    Tel.
      No.:  (631)
      924-1135

    Fax
      No.:  (631) 924-6033

    

    Copies
      of
      notices to the Issuer shall be sent to Patton Boggs LLP, 1801 California Street,
      Suite 4900, Denver, CO  80202, Attention: Alan Talesnick, Tel. No.:
      (303) 830-1776, Fax No.: (303) 894-9239.  Copies of notices to the
      Holder shall be sent to _______________, Facsimile No.: .  Any party
      hereto may from time to time change its address for notices by giving at least
      ten (10) days written notice of such changed address to the other party
      hereto.

    

    10.           Successors
      and Assigns.  This Warrant and the rights evidenced hereby shall
      inure to the benefit of and be binding upon the successors and assigns of the
      Issuer, the Holder hereof and (if applicable) the Holders of Warrant
      Stock.

    

    11.           Modification
      and Severability.  If, in any action before any court or agency
      legally empowered to enforce any provision contained herein, any provision
      hereof is found to be unenforceable, then such provision shall be deemed
      modified to the extent necessary to make it enforceable by such court or
      agency.  If any such provision is not enforceable as set forth in the
      preceding sentence, the unenforceability of such provision shall not affect
      the
      other provisions of this Warrant, but this Warrant shall be construed as if
      such
      unenforceable provision had never been contained herein.

    

    12.           Headings.  The
      headings of the Sections of this Warrant are for convenience of reference only
      and shall not, for any purpose, be deemed a part of this Warrant.

    

    IN
      WITNESS WHEREOF, the Issuer has caused this Warrant to be executed by its
      officer thereunto duly authorized.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    Original
      Issue
      Date:                                           May
      5, 2004

    Revised
      Issue
      Date:                                           December
      19, 2007

    

    

    CHEMBIO
      DIAGNOSTICS,
      INC.

    

    

    

    

    Lawrence
      A. Siebert,
      President

    

    

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    
      	
              No.:  ________

            	
              Number
                of Shares: ____________

            
	
              Original
                Date of Issuance:  May 5, 2004

            	
              Reissuance
                Date:  December 19,
                2007

            

    

     

    EXERCISE
      FORM

    

    CHEMBIO
      DIAGNOSTICS, INC.

    

    

    The
      undersigned ______________________________________, pursuant to the provisions
      of the within Warrant, hereby elects to purchase _____________ shares of Common
      Stock of Chembio Diagnostics, Inc. covered by the within Warrant.

    

    

    Date:
      _________________                                                                           Signature                      ___________________________________

    

    Address                      ___________________________________

    

    ___________________________________

    

    Number
      of
      shares of Common Stock beneficially owned or deemed beneficially owned by the
      Holder on the date of Exercise: _________________________

    

    ASSIGNMENT

    
 

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the within Warrant and all rights evidenced thereby and
      does
      irrevocably constitute and appoint _____________, attorney, to transfer the
      said
      Warrant on the books of the within named corporation.

    

    

    Date:
      _________________                                                                           Signature                      ___________________________________

    

    Address                      ___________________________________

    

    ___________________________________

    
 

    PARTIAL
      ASSIGNMENT

    
 

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the right to purchase _________ shares of Warrant Stock
      evidenced by the within Warrant together with all rights therein, and does
      irrevocably constitute and appoint ___________________, attorney, to transfer
      that part of the said Warrant on the books of the within named
      corporation.

    

    Date:
      _________________                                                                           Signature                      ___________________________________

    

    Address                      ___________________________________

    

    ___________________________________

    

    FOR
      USE BY THE ISSUER ONLY:

    

    

    This
      Warrant No. W-_________ canceled (or transferred or exchanged) this _____ day
      of
      _________________, _________, shares of Common Stock issued therefor in the
      name
      of ________________________________________________________________, Warrant
      No.
      W-___________ issued for ____________ shares of Common Stock in the name of
      _____________________________________________________________________________.Exhibit 10.1

 

MOTHERS WORK, INC.

CONFIDENTIALITY
AGREEMENT

 

March 10, 2008

 

Crescendo Partners II, L.P., Series K

Crescendo Investments II, LLC

Crescendo Partners III, L.P.

Crescendo Investments
III, LLC

825 Third Avenue, 40th
Floor

New York, NY 10022

 

Dear Sir or Madam:

 

You may have access to certain information concerning the business,
financial condition, operations, assets and liabilities of Mothers Work, Inc.
(the “Company”) which is confidential non-public information (“Company
Information”).  You and your directors,
partners, officers, employees, agents, affiliates and advisors (including,
without limitation, attorneys, accountants, consultants, bankers and financial
advisors) (collectively “Representatives”) agree to treat any Company
Information which has been or is furnished or otherwise disclosed to you by the
Company or its Representatives in accordance with the provisions of this letter
agreement, and to take or abstain from taking certain other actions hereinafter
set forth.

 

The term “Company Information” also shall be deemed to include all
notes, analyses, compilations, studies, interpretations or other documents
prepared by you or your Representatives which contain, reflect, or are based
upon, in whole or in part, the information furnished or otherwise disclosed to
you or your Representatives by the Company or its Representatives.  The term “Company Information” does not
include information which: (i) is or becomes generally available to the
public other than as a result of a disclosure by you or your Representatives; (ii) was
within your possession prior to its being furnished to you by or on behalf of
the Company, provided that the source of such information was not known by you
to be bound by a confidentiality agreement with, or other contractual, legal or
fiduciary obligation of confidentiality to, the Company or any other party with
respect to such information; (iii) becomes available to you on a
non-confidential basis from a source other than the Company or any of its
Representatives, provided that such source is not known by you to be bound by a
confidentiality agreement with, or other contractual, legal or fiduciary
obligation of confidentiality to, the Company or any other party with respect
to such information; or (iv) was independently developed by you or any of
your Representatives without reference to or use of the Company Information.

 

 

You hereby agree that you and your Representatives will keep
confidential all Company Information and that you and your Representatives will
not disclose any of the Company Information in any manner whatsoever unless the
Company gives its prior consent to disclosure of such information; provided, however,
Mr. Ajdler, so long as he is a member of the Company’s Board of Directors,
will be subject to the same requirements regarding confidentiality of Company
Information as applicable to all other members of the Board of Directors. 
In any event, you shall be responsible for any breach of this letter
agreement by any of your Representatives.

 

In the event that you or any of your Representatives are requested or
required (by oral questions, interrogatories, requests for information or
documents in legal proceedings, subpoena, civil investigative demand or other
similar process) to disclose any of the Company Information, you shall provide
the Company with prompt written notice of any such request or requirement so
that the Company may, if available, seek a protective order or other appropriate remedy
and/or waive compliance with the provisions of this letter agreement.  If, in the absence of a protective order or
other remedy or the receipt of a waiver by the Company, you or any of your
Representatives are nonetheless, based upon the advice of your outside counsel,
legally compelled to disclose Company Information to any tribunal or else stand
liable for contempt or suffer other censure of penalty, you or your
Representatives may, without liability hereunder, disclose to such tribunal
only that portion of the Company Information, including, without limitation, by
cooperating with the Company to obtain an appropriate protective order or other
reliable assurance that confidential treatment will be accorded the Company
Information by such tribunal.

 

At any time upon the request of the Company for any reason, and upon
termination of our relationship, you will promptly deliver to the Company all
Company Information (and all copies thereof) furnished to you or any of your
Representatives by or on behalf of the Company pursuant hereto.  In the event of such a decision or request,
all other Company Information prepared by you or any of your Representatives
shall be destroyed and no copy thereof shall be retained.  Notwithstanding the return or destruction of
the Company Information, you and your Representatives will continue to be bound
by your obligations of confidentiality and other obligations hereunder.

 

You hereby agree that if and only as long as Arnaud Ajdler or any of
your other Representatives is a member of the Company’s Board of Directors,
neither you nor any of your affiliates (as defined in rule 12b-2 under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will (and
you and they will not assist or encourage others to), directly or indirectly,
unless specifically requested in writing to do so in advance or consented prior
thereto in writing by the Company: (a) take any action that would result
in a Triggering Event, as defined in the Amended and Restated Rights Agreement,
dated as of October 9, 2005, between the Company and StockTrans, Inc.,
as the same may be amended or replaced from time to time; (b) seek to
inspect, by demand, legal proceeding, or otherwise, for any purpose, the
Company’s books and records or otherwise seek to exercise any rights under Section 220
of the Delaware General Corporation Law; (c) propose that any action be
taken by the stockholders of the Company, whether at a meeting of stockholders,
by written consent, or otherwise; (d) make, or in

 

2

 

any way participate in, any “solicitation” of “proxies”
(as such terms are defined under Regulation 14A of the Exchange Act) to vote or
seek to advise or influence in any manner whatsoever any person or entity with
respect to the voting of any securities of the Company; or (e) enter into
any discussions, negotiations, arrangements or understandings with or advise,
assist or encourage any third party with respect to any of the actions
discussed in the foregoing clauses (a) through (d);  provided, however,
that nothing herein will limit the ability of Mr. Ajdler to (i) review
the Company’s books
and records in his capacity as a member of the Company’s Board of Directors, (ii) propose
to other members of the Board of Directors that certain actions be taken by the
stockholders confidentially and in his capacity as a member of the Board of
Directors or (iii) exercise his 
rights as a member of the Board of Directors while serving as a member
of the Board of Directors.

 

It is understood and agreed that no failure or delay by the Company in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
future exercise thereof or the exercise of any other right, power or privilege
hereunder.

 

It is further understood and agreed that money damages would not be a
sufficient remedy for any breach of this letter agreement by you or any of your
Representatives and that the Company shall be entitled to equitable relief,
including injunction and specific performance, as a remedy for any such
breach.  Such remedies shall not be
deemed to be the exclusive remedies for a breach by you of this letter
agreement but shall be in addition to all other remedies available at law or
equity to the Company.  In the event of
litigation relating to this letter agreement, if a court of competent
jurisdiction determines that you or any of your Representatives have breached
this letter agreement, then you shall be liable and pay to the Company the
reasonable legal fees incurred by the Company in connection with such
litigation, including any appeal therefrom.

 

The Company has agreed to reimburse you for your
reasonable out-of-pocket fees and expenses incurred on or before the date
hereof in connection with your Schedule 13D, and the negotiation and execution
of this Agreement and all related activities and matters, provided that such
reimbursement will not exceed $15,000 in the aggregate.

 

This letter agreement is for the benefit of the Company, and its
directors, officers, stockholders, owners, affiliates, and agents, and shall be
governed by and construed in accordance with the laws of the State of Delaware,
without giving effect to its principles or rules regarding conflicts of
laws.

 

You hereby acknowledge that you are aware, and that you will advise
your Representatives, that the United States securities laws prohibit any
person who has received material, non-public information which is the subject
of this letter agreement from purchasing or selling securities of the Company or
from communicating such information to any other person under circumstances in
which it is reasonably foreseeable that such person is likely to purchase or
sell such securities.

 

3

 

Please confirm your agreement with the foregoing by signing and
returning one copy of this letter to the undersigned, whereupon this letter
agreement shall become a binding agreement among you and the Company.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  MOTHERS WORK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dan W. Matthias

  
	
   

  	
   

  	
  Name: Dan W. Matthias

  
	
   

  	
   

  	
  Title: Chief Executive
  Officer

  

 

4

 

	
  Accepted and agreed as
  of the date first written above:

  	
   

  
	
   

  	
   

  	
   

  
	
  CRESCENDO PARTNERS II,
  L.P., SERIES K

  	
   

  
	
  By:

  	
  Crescendo Investments
  II, LLC

  	
   

  
	
   

  	
  General Partner

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eric Rosenfeld

  	
   

  
	
   

  	
  Name: Eric Rosenfeld

  	
   

  
	
   

  	
  Title: Managing Member

  	
   

  
	
   

  	
   

  	
   

  
	
  CRESCENDO INVESTMENTS
  II, LLC

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eric Rosenfeld

  	
   

  
	
   

  	
  Name: Eric Rosenfeld

  	
   

  
	
   

  	
  Title: Managing Member

  	
   

  
	
   

  	
   

  	
   

  
	
  CRESCENDO PARTNERS III, L.P.

  	
   

  
	
  By:

  	
  Crescendo Investments
  III, LLC

  	
   

  
	
   

  	
  General Partner

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eric Rosenfeld

  	
   

  
	
   

  	
  Name: Eric Rosenfeld

  	
   

  
	
   

  	
  Title: Managing Member

  	
   

  
	
   

  	
   

  	
   

  
	
  CRESCENDO INVESTMENTS
  III, LLC

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eric Rosenfeld

  	
   

  
	
   

  	
  Name: Eric Rosenfeld

  	
   

  
	
   

  	
  Title: Managing Member

  	
   

  

 

5

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