Common use of Additional Equity Capital; Right of First Offer Clause in Contracts

Additional Equity Capital; Right of First Offer. The Company agrees that the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser (or its designated agent) offer or contract with any party to obtain additional equity financing (including any debt financing with an equity component) ("FUTURE OFFERINGS") in any form which provide for registration rights or public resale rights during the period beginning on the date hereof and ending 180 days after the date hereof (the "LOCK-UP PERIOD"). In addition, the Company will not, other than a Permitted Transaction, conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price of the Common Stock during a specified period (a "DISCOUNT OFFERING"), unless it shall have first delivered to the Purchaser at least five (5) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, an option during the five (5) business day period following delivery of such notice to purchase the securities being offered in the Discount Offering on the same terms as contemplated by such Discount Offering; PROVIDED, HOWEVER, such limitations shall not apply to the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(c) hereto. "PERMITTED TRANSACTION" shall mean the offer or sale or entering into an agreement to conduct a sale of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) to the trading price of the Common Stock (or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)

Additional Equity Capital; Right of First Offer. The Company agrees that the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser holders (or its their designated agent) holding two-thirds of the principal amount of Debentures then outstanding and the face amount of the Preferred Shares then outstanding at the time of determination, offer or contract (including by amendment or modification of any existing contract) with any party to obtain additional equity financing (including any debt financing with an equity component) ("FUTURE OFFERINGS") in any form which provide for registration rights or public resale rights during the period beginning on the date hereof and ending 180 days after the date hereof (the "LOCK-UP PERIOD"). In addition, the Company will not, other than a Permitted Transaction, without the prior written consent of holders (or their designated agent) holding two-thirds of the Debentures or Preferred Shares outstanding at the time of determination, conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price of the Common Stock during a specified period (a "DISCOUNT OFFERING"), unless it shall have first delivered to the Purchaser at least five (5) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, an option during the five (5) business day period following delivery of such notice to purchase the securities being offered in the Discount Offering on the same terms as contemplated by such Discount Offering; PROVIDED, HOWEVER, such limitations shall not apply to the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(c) hereto. "PERMITTED TRANSACTION" shall mean the offer or sale or entering into an agreement on or after 120 days after the date hereof to conduct a sale of Common Stock based on a sales price calculated as a discount of not more than twenty-five fifteen percent (2515%) to the trading price of the Common Stock (or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000).

Additional Equity Capital; Right of First Offer. The Company agrees that During the period ----------------------------------------------- beginning on the date hereof and ending 180 days following the Closing Date (the "Lock-Up Period"), the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser (or its designated agentso long as the Purchaser owns any Securities and, without duplication, holders(s) offer or of Warrants having a majority in-interest of the Warrant Shares, contract with any party to obtain additional financing in which any equity financing or equity-linked securities, having common stock registration rights and/or public resale rights effective within one (1) year after the Closing Date, are issued (including any debt financing with an equity component) (a "FUTURE OFFERINGSFuture Offering") in ). In addition, the Company will not conduct any form which provide for registration rights or public resale rights Future Offering during the period beginning on the date hereof and ending 180 days after following the date hereof (the "LOCK-UP PERIOD"). In addition, the Company will not, other than a Permitted Transaction, conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price expiration of the Common Stock during a specified period (a "DISCOUNT OFFERING")Lock-Up Period, unless it shall have first delivered to Purchaser so long as the Purchaser owns any Securities, at least five ten (510) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliatesthe Purchaser, an option during the five ten (510) business day period following delivery of such notice to purchase up to the Applicable Portion (as defined below) of the securities being offered in the Discount Future Offering on the same terms as contemplated by such Discount Future Offering; PROVIDED. During the Lock-up Period and during the 180 day period following the Mandatory Exercise Date, HOWEVERas such term is defined in the Series B Warrant, such limitations shall the Company will not apply issue any securities subject to the Registration Statement, except for the Securities, unless it shall have first delivered to the Purchaser, so long as the Purchaser owns any Securities, at least ten (10) business days prior to the proposed issuance of securities upon exercise such Securities, written notice describing the proposed transaction, including the terms and conditions thereof, and providing the Purchaser an option during the ten (10) business day period following the delivery of such notice to purchase any or conversion all of the Company's optionssecurities being offered on the same terms as contemplated by such offering. In addition, warrants the Company will not register for sale any of its equity securities in a secondary public offering (other than pursuant to registration rights arising under obligations existing on the Closing Date and disclosed on Schedule 3(d) hereto, except for those arising under the employment agreements referred to in the last sentence of Section 4(v) hereof; provided however that registrations pursuant to registration rights arising under either or other convertible securities outstanding as both of the date employment agreements referred to in the last sentence of Section 4(v) hereof will be permitted at any time after the termination of such agreements) at any time during the Lock-Up Period and set forth on Schedule 3(c) hereto. "PERMITTED TRANSACTION" shall mean during the offer or sale or entering into an agreement 180 day period following the Mandatory Exercise Date, as such term is defined in the Series B Warrant (the limitations referred to conduct a sale of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) to the trading price of the Common Stock (or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)in

Additional Equity Capital; Right of First Offer. The Company agrees that during the period beginning on the date hereof and ending ninety (90) days following the later of (i) the Closing Date and (ii) the date of the Additional Closing, if any (the "LOCK-UP PERIOD"), the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser Purchasers (or its their designated agentagents) offer holding at least two thirds (2/3rds) of the then outstanding Preferred Shares, issue or sell or contract with any party to obtain additional equity financing issue or sell any Below Market Security (including any debt financing with an equity componentas defined below) ("FUTURE OFFERINGS") in ). In addition, the Company will not conduct any form which provide for registration rights or public resale rights Future Offering during the period beginning on the date hereof and ending 180 days after following the date hereof later of (i) the "LOCK-UP PERIOD"). In additionClosing Date and (ii) the Additional Closing, the Company will not, other than a Permitted Transaction, conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price of the Common Stock during a specified period (a "DISCOUNT OFFERING")if any, unless it shall have first delivered to the each Purchaser at least five (5) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, an option during the five (5) business day period following delivery of such notice to purchase up to the securities Applicable Portion (as defined below) of the Below Market Securities being offered in the Discount Future Offering on the same terms as contemplated by such Discount Offering; PROVIDED, HOWEVER, such Future Offering (the limitations referred to in this and the immediately preceding sentence are collectively referred to as the "CAPITAL RAISING LIMITATIONS"). The Capital Raising Limitations shall not apply to the sale of Preferred Shares at the Additional Closing, if any, on the terms set forth herein or to any transaction involving issuances of securities in connection with a merger, consolidation, acquisition or sale of assets, or in connection with any strategic partnership or joint venture (the primary purpose of which is not to raise equity capital), or in connection with the disposition or acquisition of a business, product or license by the Company or exercise of options by employees, consultants or directors. The Capital Raising Limitations also shall not apply to (i) the issuance of securities pursuant to an underwritten public offering, (ii) the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(cor (iii) heretothe grant of additional options or warrants, or the issuance of additional securities, under any Company stock option or restricted stock plan for the benefit of the Company's employees, directors or consultants. The "PERMITTED TRANSACTIONAPPLICABLE PORTION" shall mean the offer product of (i) a fraction, the numerator of which is the number of Preferred Shares purchased by such Purchaser hereunder and the denominator of which is the total number of Preferred Shares purchased by all of the Purchasers hereunder (including Preferred Shares issued on the Closing Date and on the date of the Additional Closing, if any). "BELOW MARKET SECURITIES" shall mean any Common Stock or sale any security of the Company which is convertible into or entering into an agreement to conduct exercisable or exchangeable for Common Stock and which is sold at a sale "gross selling price per share" of Common Stock based on a sales which is less than the average of the Closing Bid Prices (as defined in the Certificate of Designations) for the five (5) trading days immediately preceding the date of issuance of such security, where the price calculated per share of Common Stock for any security convertible into or exchangeable or exercisable for Common Stock shall be determined by dividing (i) the total amount, if any, received or receivable by the Company as a discount consideration for issuance or sale of not more than twenty-five percent (25%) such security, plus the minimum aggregate amount of additional consideration, if any, payable to the trading price Company upon the exercise, conversion or exchange thereof by (ii) the maximum total number of the shares of Common Stock (issuable upon the exercise, conversion or without exchange of such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)security.

Additional Equity Capital; Right of First Offer. The ----------------------------------------------- Company agrees and SJP agree that during the period beginning on the date hereof and ending on the date which is 180 days following the Closing Date (the "LOCK-UP PERIOD"), the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser (or its designated agent) offer or contract with any party to not obtain additional financing in which any equity financing or equity-linked securities are issued (including any debt financing with an equity component) ("FUTURE OFFERINGS") in any form which provide for registration rights or public resale rights without first obtaining the written consent of the Purchaser. In addition, during the period beginning on the date hereof and ending 180 days after following the date hereof (expiration of the "LOCKLock-UP PERIOD"). In additionUp Period, the Company will not, other than a Permitted Transaction, conduct any offering or sale or enter into any agreement to not conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price of the Common Stock during a specified period (a "DISCOUNT OFFERING"), future offering unless it shall have first delivered to the Purchaser Purchaser, at least five ten (510) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, affiliates an option during the five ten (510) business day period following delivery of such notice to purchase all of the securities being offered in the Discount Future Offering on the same terms as contemplated by such Discount Offering; PROVIDED, HOWEVER, such limitations Future Offering (the limitation referred to in this Section 5(n) is referred to as the "CAPITAL RAISING LIMITATION"). The Capital Raising Limitation shall not apply to any transaction involving issuances of securities as consideration in a merger, consolidation or acquisition of assets, or in connection with any strategic partnership or joint venture (the primary purpose of which is not to raise equity capital), or as consideration for the acquisition of a business, product or license by the Company. The Capital Raising Limitation also shall not apply to (i) the issuance of securities pursuant to an underwritten public offering, (ii) the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(cor (iii) hereto. "PERMITTED TRANSACTION" shall mean the offer grant of additional options or sale warrants, or entering into an agreement to conduct a sale the issuance of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) to additional securities, under any duly authorized Company stock option or restricted stock plan for the trading price benefit of the Common Stock (Company's employees or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)directors.

Additional Equity Capital; Right of First Offer. The Company agrees that the Company will notthat, other than a Permitted Transaction (so long as defined below)any Debentures or Warrants are outstanding, without the prior written consent of the Purchaser (or its designated agent) offer or contract with Purchasers, it will not consummate any party to obtain additional equity financing (including any debt financing with an equity component) ("FUTURE OFFERINGS") in any form which provide for having Class A Common Stock registration rights or and/or public resale rights, which rights are effective within 270 days after the Closing Date. Notwithstanding anything to the contrary in the immediately preceding sentence, the limitations contained therein shall not restrict the Company's ability to satisfy any contractual obligations existing as of the date hereof as such are disclosed on Schedule 3(c) hereto. In addition, during the 360 day period beginning on the date hereof and ending 180 days after the date hereof (the "LOCK-UP PERIOD"). In additionClosing Date, the Company will not, other than a Permitted Transaction, not conduct any offering or sale or enter into any an agreement to conduct a sale (a "Floating Discount Offering") of any of its Class A Common Stock or securities which are convertible into or exchangeable or exercisable for Class A Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price of the Class A Common Stock during a specified period (a "DISCOUNT OFFERING"), unless it shall have first delivered to the Purchaser each Purchaser, at least five (5) business days prior to the closing of such Future Floating Discount Offering, written notice describing the proposed Future Floating Discount Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, an option during the five (5) business day period following delivery receipt of such notice by the Purchasers to purchase all or any portion of such Purchaser's Applicable Percentage (as defined below) of the securities being offered in the Floating Discount Offering on the same terms as contemplated by such Floating Discount Offering; PROVIDED, HOWEVER, such Offering (the limitations referred to in this sentence are collectively referred to as the "Floating Discount Limitations"). The Floating Discount Limitations shall not apply to (i) the issuance of securities upon in connection with a strategic merger, consolidation, acquisition or sale of assets, or in connection with any strategic partnership or joint venture, or in connection with the disposition or acquisition of a business, product or license by the Company or exercise of options by employees, consultants or conversion directors, (ii) the issuance of securities pursuant to an underwritten public offering with the Company's options, warrants financial institution or other convertible securities outstanding its affiliates as has been disclosed to the Purchasers in writing as of the date hereof and set forth on Schedule 3(cor (iii) heretoany public offering to effect a Prepayment at Borrower's Election (as defined in the Debenture). For purposes of this Section 4(e), "PERMITTED TRANSACTIONApplicable Percentage" at any time with respect to any Purchaser shall mean the offer percentage obtained by dividing (x) the aggregate number of Conversion Shares then owned by, or sale issuable upon conversion of Debentures to, such Purchaser by (y) the aggregate number of Conversion Shares then outstanding or entering issuable to all Purchasers (determined as set forth in clause (x) of this sentence). Notwithstanding any Purchaser's exercise or failure to exercise all or a portion of their rights granted pursuant to this Section 4(e), if the Company, at any time during the 360 day period beginning on the Closing Date, consummates or enters into an agreement to conduct a sale consummate any additional equity financing (including debt financing with an equity component) with any third party on terms which vary from the terms of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) the transactions contemplated hereby or which grants rights to the trading price purchasers therein which vary from the rights granted to the Purchasers in connection with the transactions contemplated hereby (collectively, the "Subsequent Benefits"), each Purchaser shall have the right, exercisable in its sole discretion, by providing the Company with written notice not later than forty five (45) days of the Common Stock receipt by such Purchaser of all applicable documentation governing such equity financing (or without "Applicable Documentation"), to amend the Securities, this Agreement and/or any other agreements entered into in connection herewith in such a discount) during a specified period for a purchase price manner so as to afford such Purchaser with any or all such Subsequent Benefits. The Company shall send to each Purchaser who, at the time of not more than Two Million Dollars ($2,000,000)consummation of such equity financing owns any Debentures or Warrants, copies of such Applicable Documentation as soon as practicable following consummation of such equity financing. The Company agrees that it shall execute and deliver any and all documents, take all actions and do, or cause to be done, all other things necessary to afford the Purchasers with the Subsequent Benefits.

Additional Equity Capital; Right of First Offer. The Company agrees that ----------------------------------------------- during the period beginning on the date hereof and ending on the date which is 240 days following the First Closing Date (the "Lock-Up Period"), the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser (or its designated agent) offer or each Purchaser, contract with any party to obtain additional financing in which any equity financing or equity-linked securities are issued (including any debt financing with an equity component) ("FUTURE OFFERINGSFuture Offerings") in ). In addition, the Company will not conduct any form which provide for registration rights or public resale rights Future Offering during the period beginning on the date hereof and ending 180 120 days after following the date hereof (the "LOCK-UP PERIOD"). In addition, the Company will not, other than a Permitted Transaction, conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to the trading price expiration of the Common Stock during a specified period (a "DISCOUNT OFFERING")Lock-Up Period, unless it shall have first delivered to the Purchaser each Purchaser, at least five ten (510) business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, affiliates an option during the five ten (510) business day period following delivery of such notice to purchase all of the securities being offered in the Discount Future Offering on the same terms as contemplated by such Discount OfferingFuture Offering (the limitations referred to in this and the immediately preceding sentence are collectively referred to as the "Capital Raising Limitations"); PROVIDEDprovided, HOWEVERhowever, that in the event more than one Purchaser desires to purchase such securities, (a) the interested Purchasers may allocate such Future Offering among themselves by agreement among such Purchasers or, in the event such Purchasers cannot reach an agreement in such period, such limitations Future Offering shall be allocated among them on a pro rata basis equal to the percentage each such Purchaser's Purchase Price bears to the sum of the Purchase Prices of such interested Purchasers. The Capital Raising Limitations shall not apply to any transaction involving issuances of securities as consideration in a merger, consolidation or acquisition of assets, or in connection with any strategic partnership or joint venture (the primary purpose of which is not to raise equity capital), or as consideration for the acquisition of a business, product or license by the Company. The Capital Raising Limitations also shall not apply to (i) the issuance of securities pursuant to an underwritten public offering, (ii) the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(cor (iii) hereto. "PERMITTED TRANSACTION" shall mean the offer grant of additional options or sale warrants, or entering into an agreement to conduct a sale the issuance of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) to additional securities, under any duly authorized Company stock option or restricted stock plan for the trading price benefit of the Common Stock (Company's employees or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)directors.

Additional Equity Capital; Right of First Offer. The Company agrees that during the period beginning on the date hereof and ending on the date which is 180 days following the Closing Date (the "Lock-Up Period"), the Company will not, other than a Permitted Transaction (as defined below), without the prior written consent of the Purchaser (or its designated agent) offer or each Purchaser, contract with any party to obtain additional financing in which any equity financing or equity-linked securities are issued (including any debt financing with an equity component) ("FUTURE OFFERINGS") in any form which provide for registration rights or public resale rights during the period beginning on the date hereof and ending 180 days after the date hereof (the "LOCK-UP PERIODFuture Offerings"). In addition, the Company will not, other than a Permitted Transaction, not conduct any offering or sale or enter into any agreement to conduct a sale of any of its Common Stock or securities which are convertible into or exchangeable or exercisable for Common Stock based on a sales, conversion, exchange or exercise price calculated as a discount of greater than fifteen percent (15%) to Future Offering during the trading price 180 days following the expiration of the Common Stock during a specified period (a "DISCOUNT OFFERING")Lock-Up Period, unless it shall have first delivered to the Purchaser each Purchaser, at least five (5) ten business days prior to the closing of such Future Offering, written notice describing the proposed Future Offering, including the terms and conditions thereof, and providing each Purchaser and its affiliates, affiliates an option during the five (5) ten business day period following delivery of such notice to purchase all of the securities being offered in the Discount Future Offering on the same terms as contemplated by such Discount OfferingFuture Offering (the limitations referred to in this and the immediately preceding sentence are collectively referred to as the "Capital Raising Limitations"); PROVIDEDprovided, HOWEVERhowever, that in the event more than one Purchaser desires to purchase such securities, the interested Purchasers may allocate such Future Offering among themselves by agreement among such Purchasers or, in the event such Purchasers cannot reach an agreement in such period, such limitations Future Offering shall be allocated among them on a pro rata basis equal to the percentage each such Purchaser's Purchase Price bears to the sum of the Purchase Prices of such interested Purchasers. The Capital Raising Limitations shall not apply to any transaction involving issuances of securities as consideration in a merger, consolidation or acquisition of assets, or in connection with any strategic partnership or joint venture (the primary purpose of which is not to raise equity capital), or as consideration for the acquisition of a business, product or license by the Company. The Capital Raising Limitations also shall not apply to (i) the issuance of securities pursuant to a firm commitment public offering, (ii) the issuance of securities upon exercise or conversion of the Company's options, warrants or other convertible securities outstanding as of the date hereof and set forth on Schedule 3(cor (iii) hereto. "PERMITTED TRANSACTION" shall mean the offer grant of additional options or sale warrants, or entering into an agreement to conduct a sale the issuance of Common Stock based on a sales price calculated as a discount of not more than twenty-five percent (25%) to additional securities, under any duly authorized Company stock option or restricted stock plan for the trading price benefit of the Common Stock (Company's employees or without such a discount) during a specified period for a purchase price of not more than Two Million Dollars ($2,000,000)directors.