Covered Security. The Company shall provide prompt written notice to ▇▇▇▇▇▇▇▇ when each of the Registration Statements has been declared effective by the SEC. The Company will use its best efforts to: (i) keep each Registration Statement effective until the earlier of (A) the later of (1) the second anniversary of the issuance of the last Covered Security that may be issued and to which such Registration Statement relates, or (2) such time as all of the Covered Securities issued or issuable to ▇▇▇▇▇▇▇▇ and to which such Registration Statement relates can be sold by ▇▇▇▇▇▇▇▇ or any of its affiliates within a three-month period without compliance with the registration requirements of the Securities Act pursuant to Rule 144 or (B) the date all of the Covered Securities covered by such Registration Statement shall have been sold by ▇▇▇▇▇▇▇▇ and its affiliates (such later period, the "Registration Period"); (ii) prepare and file with the SEC such amendments and supplements to the Registration Statements and the prospectuses used in connection with the Registration Statements (as such prospectuses are so amended and supplemented from time to time, the "Prospectuses") as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all Covered Securities by ▇▇▇▇▇▇▇▇ or any of its affiliates; (iii) furnish such number of Prospectuses and other documents incident thereto, including any amendment of or supplement to the Prospectuses, as ▇▇▇▇▇▇▇▇ from time to time may reasonably request; (iv) cause all Covered Securities to be listed on each securities exchange and quoted on each quotation service on which similar securities issued by the Company are then listed or quoted; (v) provide a transfer agent and registrar for all Covered Securities and a CUSIP number for all Covered Securities; (vi) otherwise comply with all applicable rules and regulations of the SEC, the Nasdaq and any other exchange or quotation service on which the Covered Securities are obligated to be listed or quoted under this Agreement; and (vii) file the documents required of the Company and otherwise obtain and maintain requisite blue sky clearance in (x) New York and all other jurisdictions in which any of the Covered Securities were originally sold and (y) all other states specified in writing by ▇▇▇▇▇▇▇▇, provided, however, that, as to this clause (y), the Company shall not be required to qualify to do business or consent to service of process in any state in which it is not now so qualified or has not so consented. ▇▇▇▇▇▇▇▇ shall (i) provide such information as reasonably requested by the Company in connection with the preparation of the Registration Statements and (ii) have the right to approve the description of the selling stockholder, plan of distribution and all other references to ▇▇▇▇▇▇▇▇ and its affiliates contained in any Registration Statement and any Prospectus; provided, however, that, in the event of ▇▇▇▇▇▇▇▇'▇ failure to comply with its obligations set forth in clause (i) of this sentence, the Company's obligation to file a Registration Statement will be suspended until such time as ▇▇▇▇▇▇▇▇ complies therewith and, provided, further, that, with respect to clause (ii) of this sentence, ▇▇▇▇▇▇▇▇ shall approve or reject such descriptions or references within two (2) full Business Days after and excluding the date on which the Company provides the final forms of such descriptions and references, and, in the event that ▇▇▇▇▇▇▇▇ has not approved or rejected such descriptions within five (5) full Business Days after and excluding the date on which the Company provides the final forms of such descriptions and references, the Company's obligation to file a Registration Statement will be suspended until such time as ▇▇▇▇▇▇▇▇ complies therewith. The Company shall furnish to ▇▇▇▇▇▇▇▇ upon request a reasonable number of copies of a supplement to or an amendment of any Prospectus as may be necessary in order to facilitate the public sale or other disposition of all or any of the Covered Securities by ▇▇▇▇▇▇▇▇ or any of its affiliates pursuant to the Registration Statements. With a view to making available to ▇▇▇▇▇▇▇▇ and its affiliates the benefits of Rule 144 and Form S-3 under the Securities Act, the Company covenants and agrees to: (i) make and keep available adequate current public information (within the meaning of Rule 144(c)) concerning the Company during the Registration Period; and (ii) furnish to ▇▇▇▇▇▇▇▇ upon request, as long as ▇▇▇▇▇▇▇▇ owns any Covered Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the Securities Act and the Exchange Act and, (B) such other information as may be reasonably requested in order to avail ▇▇▇▇▇▇▇▇ and its affiliates of Rule 144 or Form S-3 with respect to such Covered Securities. Notwithstanding anything else in this Section 4, if, at any time during which a Prospectus is required to be delivered in connection with the sale of any Covered Security, the Company determines in good faith and upon advice of counsel that a development has occurred or a condition exists as a result of which the Registration Statements or the Prospectuses contain a material misstatement or omission, the Company will promptly notify ▇▇▇▇▇▇▇▇ thereof by telephone and in writing. Upon receipt of such notification, ▇▇▇▇▇▇▇▇ and its affiliates will immediately suspend all offers and sales of any Covered Security pursuant to the Registration Statements, and, if so directed by the Company, ▇▇▇▇▇▇▇▇ will deliver to the Company, at the Company's expense, all copies of the Prospectuses printed in bulk in connection with a pending underwritten offering, in its possession, if any, relating to the Covered Securities. In such event, the Company will amend or supplement the Registration Statements and the Prospectuses or make such filings or public disclosures as promptly as practicable and will use its best efforts to take such other steps as may be required to permit sales of the Covered Securities thereunder by ▇▇▇▇▇▇▇▇ and its affiliates in accordance with applicable federal and state securities laws. The Company will promptly notify ▇▇▇▇▇▇▇▇ after it has determined in good faith that such sales have become permissible in such manner and will promptly deliver copies of the Registration Statements and the Prospectuses (as so amended or supplemented, if applicable) to ▇▇▇▇▇▇▇▇ in accordance with paragraphs (f) and (g) of this Section 4. Notwithstanding anything else in this Agreement, but subject to the last sentence of this Section 4(j), if a material transaction in which the Company is engaged or proposes to engage would require an immediate amendment to the Registration Statements, a supplement to the Prospectuses or a filing under the Exchange Act or other public disclosure of material information and the disclosure of such transaction would be premature or injurious to the consummation of the transaction (each, a "Blackout Event"), the Company may give notice (a "Blackout Notice") to ▇▇▇▇▇▇▇▇ by telephone and in writing to suspend sales of Covered Securities. ▇▇▇▇▇▇▇▇ agrees that, after the receipt of a Blackout Notice, it will not effect any sales of Covered Securities pursuant to the Registration Statements until the Company notifies ▇▇▇▇▇▇▇▇ that such sales are permissible and, if so directed by the Company, ▇▇▇▇▇▇▇▇ will deliver to the Company all copies of the Prospectus prepared in bulk in connection with an underwritten offering in its possession, if any, relating to the Covered Securities. At the end of any Blackout Event, the Company will (i) amend or supplement the Registration Statements and the Prospectuses or make such filings or public disclosures as promptly as practicable, (ii) use its best efforts to take such other steps as may be required to permit sales of the Covered Securities thereunder by ▇▇▇▇▇▇▇▇ and its affiliates in accordance with applicable federal and state securities laws, (iii) promptly notify ▇▇▇▇▇▇▇▇ after it has determined in good faith that such sales are permissible and (iv) promptly deliver copies of the Registration Statements and the Prospectuses (as so amended or supplemented, if applicable) to ▇▇▇▇▇▇▇▇ in accordance with paragraphs (f) and (g) of this Section 4. Notwithstanding the foregoing, (x) under no circumstances shall the Company be entitled to exercise its right under this Section 4(j) to suspend sales of any Covered Securities pursuant to the Registration Statements if (A) it has exercised its right to suspend sales under this Section 4(j) on more than one (1) other occasion in the preceding twelve (12)-month period, (B) it has exercised its right to suspend sales under this Section 4(j) on one (1) occasion, and has suspended sales pursuant to Section 4(i) for an aggregate of thirty (30) days or more, in the preceding twelve (12)-month period, or (C) it has suspended sales pursuant to Section 4(i) for an aggregate of sixty (60) days or more in the preceding twelve (12)-month period, (y) any suspension under this Section 4(j) shall not exceed thirty (30) days and (z) no suspension under this Section 4(j) may commence less than thirty (30) days after the end of the preceding suspension under Section 4(i) or this Section 4(j). Promptly after the commencement of any suspension of sales of the Covered Security pursuant to this Section 4 (each period during which such sales are suspended being referred to herein as a "Blackout Period"), ▇▇▇▇▇▇▇▇ will notify the Company of any contract to sell, assign, deliver or otherwise transfer any Covered Security that requires delivery of such Covered Security no later than three (3) Business Days after execution (each a "Sales Contract") that ▇▇▇▇▇▇▇▇ or any of its affiliates has entered into prior to the commencement of such Blackout Period and that would require delivery of such Covered Securities during such Blackout Period, which notice will contain the aggregate sale price and quantity of Covered Securities pursuant to such Sales Contract. Within two (2) Business Days of receipt of such notice, the Company will notify ▇▇▇▇▇▇▇▇ of its election either to (i) terminate the Blackout Period and, as promptly as practicable, amend or supplement the Registration Statements or the Prospectuses in order to correct the material misstatement or omission and deliver to ▇▇▇▇▇▇▇▇ copies of such amended or supplemented Registration Statement and Prospectus in accordance with paragraphs (f) and (g) of this Section 4, or (ii) continue the Blackout Period in accordance with this paragraph. If the Company elects to continue the Blackout Period (or the Company elects to terminate the Blackout Period, but the Blackout Period is not terminated before the latest date that ▇▇▇▇▇▇▇▇ may consummate the transaction contemplated by the Sales Contract), and if ▇▇▇▇▇▇▇▇ or any of its affiliates are therefore unable to consummate the sale of Covered Securities pursuant to the Sales Contract (such unsold Covered Securities being the "Unsold Securities"), the Company will promptly indemnify each ▇▇▇▇▇▇▇▇ Indemnified Party (as such term is defined in Section 17(a) below) against any Proceeding (as such term is defined in Section 17(a) below) that each ▇▇▇▇▇▇▇▇ Indemnified Party may incur arising out of or in connection with ▇▇▇▇▇▇▇▇'▇ breach or alleged breach of any such Sales Contract, and the Company shall reimburse each ▇▇▇▇▇▇▇▇ Indemnified Party for any reasonable costs or expenses (including reasonable legal fees) incurred by such party in investigating or defending any such Proceeding. The purpose of the indemnities set forth in this Section 4(k) shall be to make the ▇▇▇▇▇▇▇▇ Indemnified Parties whole for all losses, costs and expenses related to such Blackout Period, and the calculation of any indemnification payment under this Section 4(k) shall take into account all relevant factors, including (i) any cash payment made to any Person to terminate or modify such Sales Contract, (ii) the cost of covering by purchasing or borrowing Common Stock or other securities to deliver pursuant to such Sales Contract, (iii) the expected net benefit to ▇▇▇▇▇▇▇▇ of delivering the Unsold Securities pursuant to the Sales Contract and (iv) ▇▇▇▇▇▇▇▇'▇ mitigation of losses resulting from sales of the Unsold Securities after the Blackout Period; provided, however, that nothing in this Section 4(k)(iv) shall require ▇▇▇▇▇▇▇▇ to take any actions that would have or could reasonably be expected to have an adverse economic effect on ▇▇▇▇▇▇▇▇ or its affiliates. Upon receipt of ▇▇▇▇▇▇▇▇'▇ notice of existing Sales Contracts required by this Section 4(k), the Company and ▇▇▇▇▇▇▇▇ shall discuss in good faith any steps that could reasonably be taken to mitigate any losses relating to any Unsold Securities. In the event of a Blackout Period, ▇▇▇▇▇▇▇▇ shall take reasonable actions to mitigate losses relating to Unsold Securities and resulting from the Blackout Period; provided, however, that ▇▇▇▇▇▇▇▇ shall not be required to take any actions that would have or could reasonably be expected to have an adverse economic effect (after taking into account any specifically-stated, written commitment by the Company to provide indemnification under this Section 4(k) with respect to such action) on ▇▇▇▇▇▇▇▇ or its affiliates. The amounts owed to ▇▇▇▇▇▇▇▇ by the Company hereunder shall be reduced by losses resulting from ▇▇▇▇▇▇▇▇'▇ failure to comply with its obligation set forth in the preceding sentence. If the Company elects to terminate the Blackout Period, ▇▇▇▇▇▇▇▇ shall use reasonable efforts to extend the consummation date of such Sales Contract until after such Blackout Period ends; provided, however, that ▇▇▇▇▇▇▇▇ shall not be required to take any action with respect to such Sales Contract that would have an adverse economic effect on ▇▇▇▇▇▇▇▇. If (i) the Registration Requirement is not satisfied at any time, (ii) the Company suspends sales under Section 4(j) on more than one (1) other occasion in the preceding twelve (12)-month period, (iii) the Company suspends sales under Section 4(j) on one (1) occasion, and has suspended sales pursuant to Section 4(i) for an aggregate of thirty (30) days or more, in the preceding twelve (12)-month period, (iv) the Company suspends sales pursuant to Section 4(i) for an aggregate of sixty (60) days or more in the preceding twelve (12)-month period, or (v) any suspension under Section 4(j) shall exceed thirty (30) days or shall occur within thirty (30) days of any suspension under Section 4(i) or Section 4(j) (each of (ii), (iii), (iv) and (v), a "Blackout Violation"), then for each month or portion thereof in which the Registration Requirement is not satisfied or a Blackout Violation occurs or continues, the Agreement Date Price shall be reduced by $0.3524 and the Amendment Date Price shall be reduced by $0.3170, including through the issuance of additional shares of Common Stock as if such adjusted Agreement Date Price or Amendment Date Price, as the case may be, had been in effect as of the date hereof and as of each of the dates on which an Additional Investment Notice was delivered to the Company, as applicable; provided, however, that no reduction of the Agreement Date Price or Amendment Date Price (and issuance of additional shares of Common Stock) shall be made (1) with respect to any Common Shares that (x) are not owned by ▇▇▇▇▇▇▇▇ or its affiliates on the date of the event giving rise to such reduction or (y) may be sold pursuant to an effective Registration Statement and are not affected by the Company's failure to satisfy the Registration Requirement, or (2) with respect to Common Shares issuable upon exercise of the MTI Investment Rights, after the date of an SEC Rejection and before the exercise of such MTI Investment Rights. For purposes of this Agreement, "SEC Rejection" shall mean the SEC's (or its Staff's) delivery of a comment or instruction (either orally or in writing) to the Company or its counsel stating that the SEC will not permit the Company to register the resale of Common Shares issuable upon exercise of the MTI Additional Investment Rights (as defined in the Certificate) or otherwise issuable hereunder or under the Certificate until such shares have been issued, but, if applicable, does not object to the registration of the
Appears in 1 contract
Covered Security. The Company shall provide prompt written notice to ▇▇▇▇▇▇▇▇ when each of the Registration Statements has been declared effective by the SEC. The Company will use its best efforts to: (i) keep each Registration Statement effective until the earlier of (A) the later of (1) the second anniversary of the issuance of the last Covered Security that may be issued and to which such Registration Statement relates, or (2) such time as all of the Covered Securities issued or issuable to ▇▇▇▇▇▇▇▇ and to which such Registration Statement relates can be sold by ▇▇▇▇▇▇▇▇ or any of its affiliates within a three-month period without compliance with the registration requirements of the Securities Act pursuant to Rule 144 or (B) the date all of the Covered Securities covered by such Registration Statement shall have been sold by ▇▇▇▇▇▇▇▇ and its affiliates (such later period, the "Registration Period"); (ii) prepare and file with the SEC such amendments and supplements to the Registration Statements and the prospectuses used in connection with the Registration Statements (as such prospectuses are so amended and supplemented from time to time, the "Prospectuses") as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all Covered Securities by ▇▇▇▇▇▇▇▇ or any of its affiliates; (iii) furnish such number of Prospectuses and other documents incident thereto, including any amendment of or supplement to the Prospectuses, as ▇▇▇▇▇▇▇▇ from time to time may reasonably request; (iv) cause all Covered Securities to be listed on each securities exchange and quoted on each quotation service on which similar securities issued by the Company are then listed or quoted; (v) provide a transfer agent and registrar for all Covered Securities and a CUSIP number for all Covered Securities; (vi) otherwise comply with all applicable rules and regulations of the SEC, the Nasdaq and any other exchange or quotation service on which the Covered Securities are obligated to be listed or quoted under this Agreement; and (vii) file the documents required of the Company and otherwise obtain and maintain requisite blue sky clearance in (x) New York and all other jurisdictions in which any of the Covered Securities were originally sold and (y) all other states specified in writing by ▇▇▇▇▇▇▇▇, provided, however, that, as to this clause (y), the Company shall not be required to qualify to do business or consent to service of process in any state in which it is not now so qualified or has not so consented. ▇▇▇▇▇▇▇▇ shall (i) provide such information as reasonably requested by the Company in connection with the preparation of the Registration Statements and (ii) have the right to approve the description of the selling stockholder, plan of distribution and all other references to ▇▇▇▇▇▇▇▇ and its affiliates contained in any Registration Statement and any Prospectus; provided, however, that, in the event of ▇▇▇▇▇▇▇▇'▇ failure to comply with its obligations set forth in clause (i) of this sentence, the Company's obligation to file a Registration Statement will be suspended until such time as ▇▇▇▇▇▇▇▇ complies therewith and, provided, further, that, with respect to clause (ii) of this sentence, ▇▇▇▇▇▇▇▇ shall approve or reject such descriptions or references within two (2) full Business Days after and excluding the date on which the Company provides the final forms of such descriptions and references, and, in the event that ▇▇▇▇▇▇▇▇ has not approved or rejected such descriptions within five (5) full Business Days after and excluding the date on which the Company provides the final forms of such descriptions and references, the Company's obligation to file a Registration Statement will be suspended until such time as ▇▇▇▇▇▇▇▇ complies therewith. The Company shall furnish to ▇▇▇▇▇▇▇▇ upon request a reasonable number of copies of a supplement to or an amendment of any Prospectus as may be necessary in order to facilitate the public sale or other disposition of all or any of the Covered Securities by ▇▇▇▇▇▇▇▇ or any of its affiliates pursuant to the Registration Statements. With a view to making available to ▇▇▇▇▇▇▇▇ and its affiliates the benefits of Rule 144 and Form S-3 under the Securities Act, the Company covenants and agrees to: (i) make and keep available adequate current public information (within the meaning of Rule 144(c)) concerning the Company during the Registration Period; and (ii) furnish to ▇▇▇▇▇▇▇▇ upon request, as long as ▇▇▇▇▇▇▇▇ owns any Covered Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the Securities Act and the Exchange Act and, (B) such other information as may be reasonably requested in order to avail ▇▇▇▇▇▇▇▇ and its affiliates of Rule 144 or Form S-3 with respect to such Covered Securities. Notwithstanding anything else in this Section 4, if, at any time during which a Prospectus is required to be delivered in connection with the sale of any Covered Security, the Company determines in good faith and upon advice of counsel that a development has occurred or a condition exists as a result of which the Registration Statements or the Prospectuses contain a material misstatement or omission, the Company will promptly notify ▇▇▇▇▇▇▇▇ thereof by telephone and in writing. Upon receipt of such notification, ▇▇▇▇▇▇▇▇ and its affiliates will immediately suspend all offers and sales of any Covered Security pursuant to the Registration Statements, and, if so directed by the Company, ▇▇▇▇▇▇▇▇ will deliver to the Company, at the Company's expense, all copies of the Prospectuses printed in bulk in connection with a pending underwritten offering, in its possession, if any, relating to the Covered Securities. In such event, the Company will amend or supplement the Registration Statements and the Prospectuses or make such filings or public disclosures as promptly as practicable and will use its best efforts to take such other steps as may be required to permit sales of the Covered Securities thereunder by ▇▇▇▇▇▇▇▇ and its affiliates in accordance with applicable federal and state securities laws. The Company will promptly notify ▇▇▇▇▇▇▇▇ after it has determined in good faith that such sales have become permissible in such manner and will promptly deliver copies of the Registration Statements and the Prospectuses (as so amended or supplemented, if applicable) to ▇▇▇▇▇▇▇▇ in accordance with paragraphs (f) and (g) of this Section 4. Notwithstanding anything else in this Agreement, but subject to the last sentence of this Section 4(j), if a material transaction in which the Company is engaged or proposes to engage would require an immediate amendment to the Registration Statements, a supplement to the Prospectuses or a filing under the Exchange Act or other public disclosure of material information and the disclosure of such transaction would be premature or injurious to the consummation of the transaction (each, a "Blackout Event"), the Company may give notice (a "Blackout Notice") to ▇▇▇▇▇▇▇▇ by telephone and in writing to suspend sales of Covered Securities. ▇▇▇▇▇▇▇▇ agrees that, after the receipt of a Blackout Notice, it will not effect any sales of Covered Securities pursuant to the Registration Statements until the Company notifies ▇▇▇▇▇▇▇▇ that such sales are permissible and, if so directed by the Company, ▇▇▇▇▇▇▇▇ will deliver to the Company all copies of the Prospectus prepared in bulk in connection with an underwritten offering in its possession, if any, relating to the Covered Securities. At the end of any Blackout Event, the Company will (i) amend or supplement the Registration Statements and the Prospectuses or make such filings or public disclosures as promptly as practicable, (ii) use its best efforts to take such other steps as may be required to permit sales of the Covered Securities thereunder by ▇▇▇▇▇▇▇▇ and its affiliates in accordance with applicable federal and state securities laws, (iii) promptly notify ▇▇▇▇▇▇▇▇ after it has determined in good faith that such sales are permissible and (iv) promptly deliver copies of the Registration Statements and the Prospectuses (as so amended or supplemented, if applicable) to ▇▇▇▇▇▇▇▇ in accordance with paragraphs (f) and (g) of this Section 4. Notwithstanding the foregoing, (x) under no circumstances shall the Company be entitled to exercise its right under this Section 4(j) to suspend sales of any Covered Securities pursuant to the Registration Statements if (A) it has exercised its right to suspend sales under this Section 4(j) on more than one (1) other occasion in the preceding twelve (12)-month period, (B) it has exercised its right to suspend sales under this Section 4(j) on one (1) occasion, and has suspended sales pursuant to Section 4(i) for an aggregate of thirty (30) days or more, in the preceding twelve (12)-month period, or (C) it has suspended sales pursuant to Section 4(i) for an aggregate of sixty (60) days or more in the preceding twelve (12)-month period, (y) any suspension under this Section 4(j) shall not exceed thirty (30) days and (z) no suspension under this Section 4(j) may commence less than thirty (30) days after the end of the preceding suspension under Section 4(i) or this Section 4(j). Promptly after the commencement of any suspension of sales of the Covered Security pursuant to this Section 4 (each period during which such sales are suspended being referred to herein as a "Blackout Period"), ▇▇▇▇▇▇▇▇ will notify the Company of any contract to sell, assign, deliver or otherwise transfer any Covered Security that requires delivery of such Covered Security no later than three (3) Business Days after execution (each a "Sales Contract") that ▇▇▇▇▇▇▇▇ or any of its affiliates has entered into prior to the commencement of such Blackout Period and that would require delivery of such Covered Securities during such Blackout Period, which notice will contain the aggregate sale price and quantity of Covered Securities pursuant to such Sales Contract. Within two (2) Business Days of receipt of such notice, the Company will notify ▇▇▇▇▇▇▇▇ of its election either to (i) terminate the Blackout Period and, as promptly as practicable, amend or supplement the Registration Statements or the Prospectuses in order to correct the material misstatement or omission and deliver to ▇▇▇▇▇▇▇▇ copies of such amended or supplemented Registration Statement and Prospectus in accordance with paragraphs (f) and (g) of this Section 4, or (ii) continue the Blackout Period in accordance with this paragraph. If the Company elects to continue the Blackout Period (or the Company elects to terminate the Blackout Period, but the Blackout Period is not terminated before the latest date that ▇▇▇▇▇▇▇▇ may consummate the transaction contemplated by the Sales Contract), and if ▇▇▇▇▇▇▇▇ or any of its affiliates are therefore unable to consummate the sale of Covered Securities pursuant to the Sales Contract (such unsold Covered Securities being the "Unsold Securities"), the Company will promptly indemnify each ▇▇▇▇▇▇▇▇ Indemnified Party (as such term is defined in Section 17(a) below) against any Proceeding (as such term is defined in Section 17(a) below) that each ▇▇▇▇▇▇▇▇ Indemnified Party may incur arising out of or in connection with ▇▇▇▇▇▇▇▇'▇ breach or alleged breach of any such Sales Contract, and the Company shall reimburse each ▇▇▇▇▇▇▇▇ Indemnified Party for any reasonable costs or expenses (including reasonable legal fees) incurred by such party in investigating or defending any such Proceeding. The purpose of the indemnities set forth in this Section 4(k) shall be to make the ▇▇▇▇▇▇▇▇ Indemnified Parties whole for all losses, costs and expenses related to such Blackout Period, and the calculation of any indemnification payment under this Section 4(k) shall take into account all relevant factors, including (i) any cash payment made to any Person to terminate or modify such Sales Contract, (ii) the cost of covering by purchasing or borrowing Common Stock or other securities to deliver pursuant to such Sales Contract, (iii) the expected net benefit to ▇▇▇▇▇▇▇▇ of delivering the Unsold Securities pursuant to the Sales Contract and (iv) ▇▇▇▇▇▇▇▇'▇ mitigation of losses resulting from sales of the Unsold Securities after the Blackout Period; provided, however, that nothing in this Section 4(k)(iv) shall require ▇▇▇▇▇▇▇▇ to take any actions that would have or could reasonably be expected to have an adverse economic effect on ▇▇▇▇▇▇▇▇ or its affiliates. Upon receipt of ▇▇▇▇▇▇▇▇'▇ notice of existing Sales Contracts required by this Section 4(k), the Company and ▇▇▇▇▇▇▇▇ shall discuss in good faith any steps that could reasonably be taken to mitigate any losses relating to any Unsold Securities. In the event of a Blackout Period, ▇▇▇▇▇▇▇▇ shall take reasonable actions to mitigate losses relating to Unsold Securities and resulting from the Blackout Period; provided, however, that ▇▇▇▇▇▇▇▇ shall not be required to take any actions that would have or could reasonably be expected to have an adverse economic effect (after taking into account any specifically-stated, written commitment by the Company to provide indemnification under this Section 4(k) with respect to such action) on ▇▇▇▇▇▇▇▇ or its affiliates. The amounts owed to ▇▇▇▇▇▇▇▇ by the Company hereunder shall be reduced by losses resulting from ▇▇▇▇▇▇▇▇'▇ failure to comply with its obligation set forth in the preceding sentence. If the Company elects to terminate the Blackout Period, ▇▇▇▇▇▇▇▇ shall use reasonable efforts to extend the consummation date of such Sales Contract until after such Blackout Period ends; provided, however, that ▇▇▇▇▇▇▇▇ shall not be required to take any action with respect to such Sales Contract that would have an adverse economic effect on ▇▇▇▇▇▇▇▇. If (i) the Registration Requirement or Amendment Requirement is not satisfied at any time, (ii) the Company suspends sales under Section 4(j) on more than one (1) other occasion in the preceding twelve (12)-month period, (iii) the Company suspends sales under Section 4(j) on one (1) occasion, and has suspended sales pursuant to Section 4(i) for an aggregate of thirty (30) days or more, in the preceding twelve (12)-month period, (iv) the Company suspends sales pursuant to Section 4(i) for an aggregate of sixty (60) days or more in the preceding twelve (12)-month period, or (v) any suspension under Section 4(j) shall exceed thirty (30) days or shall occur within thirty (30) days of any suspension under Section 4(i) or Section 4(j) (each of (ii), (iii), (iv) and (v), a "Blackout Violation"), then for each month or portion thereof in which the Registration Requirement or Amendment Requirement is not satisfied or a Blackout Violation occurs or continues, the Agreement Date Price shall be reduced by $0.3524 0.3524, and for each month or portion thereof in which the Registration Requirement or Amendment Date Requirement is not satisfied or a Blackout Violation occurs or continues on and after January 1, 2006, the Prevailing Price (as defined in the Certificate) of Common Stock as of any determination date shall also be reduced by $0.3170an amount equal to five percent (5%) multiplied by the Prevailing Price that otherwise would be in effect on such date, including through the issuance of additional shares of Common Stock as if such adjusted Agreement Date Price or Amendment Date Prevailing Price, as the case may be, had been in effect as of the date hereof and as of each of the dates on which an Additional Investment Notice was delivered to the Company, as applicable; , provided, however, that no reduction of the Agreement Date Price or Amendment Date Prevailing Price (and issuance of additional shares of Common Stock) shall be made (1) with respect to any Common Shares that (x) are not owned by ▇▇▇▇▇▇▇▇ or its affiliates on the date of the event giving rise to such reduction or (y) may be sold pursuant to an effective Registration Statement and are not affected by the Company's failure to satisfy the Registration Requirement or the Amendment Requirement, as the case may be. If the Registration Requirement is not satisfied at any point in time during the Registration Period, if the Amendment Requirement is not satisfied, or (2) with respect to Common Shares issuable upon exercise if a Blackout Violation occurs, then the end of the MTI Investment Rights, after the date of an SEC Rejection and before the exercise of such MTI Investment Rights. For purposes of this Agreement, "SEC Rejection" shall mean the SEC's (or its Staff's) delivery of a comment or instruction (either orally or in writing) to the Company or its counsel stating that the SEC will not permit the Company to register the resale of Common Shares issuable upon exercise of the MTI Additional Investment Rights Term (as defined in the Certificate) or otherwise issuable hereunder or under the Certificate until such shares have been issued, but, if applicable, does not object to the registration of thede
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Sources: Purchase and Sale Agreement (Mechanical Technology Inc)