Common use of Adjustment for Dilutive Events Clause in Contracts

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time or from time to time after the date hereof, sell any shares of Common Stock for a consideration per share less than the Exercise Price then in effect, or issue any shares of Common Stock as a stock dividend to the holders of Common Stock (any such sale or issuance being herein called a "Change of Shares"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to such Change of Shares, by (2) the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes of any adjustment to be made in accordance with this Section 11 the following provisions shall be applicable: (a) In case of the issuance or sale of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of consideration therefor other than cash deemed to have been received by the Company shall be the value of such consideration as determined in good faith by the Board of Directors of the Company on the basis of a record of values of similar property or services.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the original date hereofof issuance of this Warrant the Corporation issues or sells, sell or in accordance with Section 4.4 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDiluted Share Price"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "Dilutive Event"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock upon conversion of the Company Series A Preferred Shares issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.3(b) and in Section 4.4 below, the term "Common Stock" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Exercise Price of this Warrant held by a particular holder shall not be adjusted pursuant to this Article 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of this Warrant fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75% of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. A Warrant which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Warrant so loses its rights to such adjustment, all Warrants which have lost their right to such adjustment as of values such time shall be automatically classified into (and the outstanding Warrant representing such Warrant will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc., consecutively, beginning with A-1. The holders of similar property Warrants of each such sub-series shall promptly deliver such Warrants to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such Warrants are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such Warrants, all dividend payments or other distributions owing with respect to the Warrants represented by such Warrants.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time or from time to time after the date hereof, sell any shares of Common Stock for a consideration per share less than the Exercise Price then in effect, or issue any shares of Common Stock as a stock dividend to the holders of Common Stock (any such sale or issuance being herein called a "Change of Shares"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( (to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (iI) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to such Change of Shares, by (2) the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes of any adjustment to be made in accordance with this Section 11 5 the following provisions shall be applicable: 5.3.1. Shares of Common Stock issuable by way of dividend or other distribution on any stock of the Company shall be deemed to have been issued immediately after the opening of business on the day following the record date for the determination of stockholders entitled to receive such dividend or other distribution and shall be deemed to have been issued without consideration. 5.3.2. The reclassification of securities of the Company other than shares of Common Stock into securities including shares of Common Stock shall be deemed to involve the issuance of such shares of Common Stock for a consideration other than cash immediately prior to the close of business on the date fixed for the determination of security holders entitled to receive such shares, and the value of the consideration allocable to such shares of Common Stock shall be determined as provided in Section 5. 5.3.3. The number of shares of Common Stock at any one time outstanding shall be deemed to include the aggregate maximum number of shares issuable (asubject to readjustment upon the actual issuance thereof) upon the exercise of options, rights or warrants and upon the conversion or exchange of convertible or exchangeable securities. 5.3.4. Upon each adjustment of the Exercise Price pursuant to this Section 5, the number of shares of Common Stock receivable upon the exercise of each Warrant shall be the number derived by multiplying the number of shares of Common Stock receivable immediately prior to such adjustment by the Exercise Price in effect prior to such adjustment and dividing the product so obtained by the applicable adjusted Exercise Price. a. In case of any reclassification or change of outstanding shares of Common Stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of subdivision or combination), or in case of any consolidation or merger of the Company with or into another corporation (other than a merger with a subsidiary in which merger the Company is the continuing corporation and which does not result in any reclassification or change of the then outstanding shares of Common Stock or other capital stock issuable upon exercise of the Warrants other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of subdivision or combination) or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, then, as a condition of such reclassification, change, consolidation, merger, sale or conveyance, the Company, or such successor or purchasing corporation, as the case may be, shall make lawful and adequate provision whereby the Holder of each Warrant then outstanding shall have the right thereafter to receive on exercise of such Warrant the kind and amount of securities and property receivable upon such reclassification, change, consolidation, merger, sale or conveyance by a holder of the number of securities issuable upon exercise of such Warrant immediately prior to such reclassification, change, consolidation, merger, sale or conveyance and shall forthwith file at the corporate office of the stock transfer agent, if any, a statement signed by its Chief Executive Officer, President or a Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary evidencing such provision. b. After each adjustment of the Exercise Price pursuant to this Section 5, the Company will promptly prepare a certificate signed by the Chairman, Chief Executive Officer or President, and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary, of the Company setting forth: (I) the Exercise Price as so adjusted, (ii) the number of shares of Common Stock receivable upon exercise of each Warrant, after such adjustment, and (iii) a brief statement of the facts accounting for such adjustment. The Company will promptly cause a brief summary thereof to be sent by ordinary first class mail to each Holder at his last address as it shall appear on the registry books of the Company. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity thereof except as to the Holder to whom the Company failed to mail such notice, or except as to the Holder whose notice was defective. The affidavit of the Secretary or an Assistant Secretary of the Company that such notice has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. c. No adjustment of the Exercise Price shall be made as a result of or in connection with the issuance or sale of shares of Common Stock (pursuant to options, warrants, stock purchase agreements and convertible or of other exchangeable securities deemed hereunder outstanding or in effect on the date hereof or hereafter. In addition, Holders shall not be entitled to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received dividends paid by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold prior to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights any Warrant or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of consideration therefor other than cash deemed to have been received Warrants held by the Company shall be the value of such consideration as determined in good faith by the Board of Directors of the Company on the basis of a record of values of similar property or servicesthem.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the original date hereofof issuance of this Warrant the Corporation issues or sells, sell or in accordance with Section 3.4 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Price then (the "Diluted Share Price") in effect, or issue any shares of Common Stock as a stock dividend effect immediately prior to the holders time of Common Stock such issue or sale (any such sale or issuance being herein called a "Change of SharesDilutive Event"), then, and thereafter immediately before then forthwith upon the date occurrence of any such sale or the record date for each Change of Shares, Dilutive Event the Exercise Price for the Warrants (whether or not the same shall will be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) reduced so that the Exercise Price in effect immediately before such Change of Shares and (b) following the sum of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, (i) the total number issuance by the Corporation of up to 3,500,000 shares of Common Stock, or securities convertible into or options to acquire up to 3,500,000 shares of Common Stock, issued pursuant to the Company's 1994 Stock outstanding immediately prior to such Change of SharesIncentive Plan, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to such Change of Shares, by (2) the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes of any adjustment to be made in accordance with this Section 11 the following provisions shall be applicable: (a) In case upon conversion of the issuance or sale of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cashCorporation's Series A Preferred Shares, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount issuance of cash actually received by the Company for such securities, in any other case. (b) In case up to 5% of the issuance or sale (otherwise than as a dividend or other distribution on any stock Common Stock of the Company, and otherwise than on company upon the exercise of optionsoptions granted to Blue Rhino Corporation distributors, rights or warrants or (iv) the issuance of up to 5% of the Common Stock of the Company upon the conversion of options issued pursuant to stock option plans or exchange of convertible grants to officers or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of consideration therefor other than cash deemed to have been received by the Company shall be the value of such consideration as determined in good faith employees approved by the Board of Directors after an IPO, (v) the issuance of Common Stock upon exercise of existing Warrants to acquire up to 17,844,244 shares of Common Stock issued prior to the close hereof, or (vi) the issuance of $750,000 worth of Common Stock to Bison Propane Bottle Exchange, L.L.C. at a price per share equal to the purchase price for the Company's -6- Common Stock in an IPO or in a private placement of not less than $10,000,000 of the Company Company's Common Stock, shall not constitute a Dilutive Event. As used in this Section 3.3(b) and in Section 3.4 below, the term "Common Stock" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Exercise Price of this Warrant held by a particular holder shall not be adjusted pursuant to this Article III in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of this Warrant fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75% of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. A Warrant which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Warrant so loses its rights to such adjustment, all Warrants which have lost their right to such adjustment as of values such time shall be automatically classified into (and the outstanding Warrant representing such Warrant will automatically be deemed to represent). The holders of similar property Warrants of each such sub-series shall promptly deliver such Warrants to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such Warrants are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such Warrants, all dividend Payments or other distributions owing with respect to the Warrants represented by such Warrants.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the original date hereofof issuance of the Series A Preferred the Corporation issues or sells, sell or in accordance with Section 4.3 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDiluted Share Price"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "Dilutive Event"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock pursuant to the Warrants issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.2(b) and in Section 4.3 below, the term "Common Stock" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Conversion Price of Series A Preferred held by a particular holder shall not be adjusted pursuant to this Section 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of Series A Preferred fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the Company securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75% of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. Series A Preferred which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Series A Preferred so loses its rights to such adjustment, all shares of values Series A Preferred which have lost their right to such adjustment as of similar property such time shall be automatically classified into (and the outstanding certificates representing such Series A Preferred will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc., consecutively, beginning with A-1. The holders of shares of each such sub- series shall promptly deliver the certificate(s) representing such stock to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such certificates are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such certificates, all dividend payments or other distributions owing with respect to the shares represented by such certificates.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the ------------------------------ original date hereofof issuance of this Warrant the Corporation issues or sells, sell or in accordance with Section 4.4 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDILUTED SHARE PRICE"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "DILUTIVE EVENT"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock upon conversion of the Company Series A Preferred Shares issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.3(b) and in Section 4.4 below, the term "COMMON STOCK" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Exercise Price of this Warrant held by a particular holder shall not be adjusted pursuant to this Article 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of this Warrant fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75 % of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. A Warrant which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Warrant so loses its rights to such adjustment, all Warrants which have lost their right to such adjustment as of values such time shall be automatically classified into (and the outstanding Warrant representing such Warrant will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc. , consecutively, beginning with A-1. The holders of similar property Warrants of each such sub-series shall promptly deliver such Warrants to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such Warrants are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such Warrants, all dividend payments or other distributions owing with respect to the Warrants represented by such Warrants.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the ------------------------------ original date hereofof issuance of this Warrant the Corporation issues or sells, sell or in accordance with Section 4.4 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDILUTED SHARE PRICE"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "DILUTIVE EVENT"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock upon conversion of the Company Series A Preferred Shares issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.3(b) and in Section 4.4 below, the term "COMMON STOCK" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Exercise Price of this Warrant held by a particular holder shall not be adjusted pursuant to this Article 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of this Warrant fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75 % of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. A Warrant which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Warrant so loses its rights to such adjustment, all Warrants which have lost their right to such adjustment as of values such time shall be automatically classified into (and the outstanding Warrant representing such Warrant will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc. , consecutively, beginning with X- 0. The holders of similar property Warrants of each such sub-series shall promptly deliver such Warrants to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such Warrants are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such Warrants, all dividend payments or other distributions owing with respect to the Warrants represented by such Warrants.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the original date hereofof issuance of this Warrant the Corporation issues or sells, sell or in accordance with Section 4.4 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDiluted Share Price"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "Dilutive Event"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 2,000,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock upon conversion of the Company Series A Preferred Shares issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.3(b) and in Section 4.4 below, the term "Common Stock" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Exercise Price of this Warrant held by a particular holder shall not be adjusted pursuant to this Article 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of this Warrant fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75 % of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. A Warrant which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Warrant so loses its rights to such adjustment, all Warrants which have lost their right to such adjustment as of values such time shall be automatically classified into (and the outstanding Warrant representing such Warrant will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc., consecutively, beginning with A-1. The holders of similar property Warrants of each such sub-series shall promptly deliver such Warrants to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such Warrants are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such Warrants, all dividend payments or other distributions owing with respect to the Warrants represented by such Warrants.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time or from time to time after the date hereof, sell any shares of Common Stock for or a consideration per share less than the lesser of (A) the Market Price (as defined in Section 6.3.6) or (B) the Exercise Price then in effect, or issue any shares of Common Stock as a stock dividend to the holders of Common Stock Stock, (any such sale or issuance being herein called a "Change change of Shares"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( in effect any applicable fraction of a cent to the nearest cent), with such adjusted Exercise Price ) determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the greater of (x) the Market Price and (y) the Exercise Price in effect immediately prior to such Change of Shares, by (2) the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes of any adjustment to be made in accordance with this Section 11 6 the following provisions shall be applicable: (a) 6.3.1 In case of the issuance or sale of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor thereof or deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) 6.3.2 In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of consideration therefor thereof or other than cash deemed to have been received by the Company shall be the value of such consideration as determined in good faith by the Board of Directors of the Company on the basis of a record of values of similar property or services.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time or from time to time after the date hereof, sell any shares of Common Stock for a consideration per share less than the Exercise Price then in effect, or issue any shares of Common Stock as a stock dividend to the holders of Common Stock (any such sale or issuance being herein called a "Change of Shares"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( (to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to such Change of Shares, by (2) the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes of any adjustment to be made in accordance with this Section 11 5 the following provisions shall be applicable: 5.3.1. Shares of Common Stock issuable by way of dividend or other distribution on any stock of the Company shall be deemed to have been issued immediately after the opening of business on the day following the record date for the determination of stockholders entitled to receive such dividend or other distribution and shall be deemed to have been issued without consideration. 5.3.2. The reclassification of securities of the Company other than shares of Common Stock into securities including shares of Common Stock shall be deemed to involve the issuance of such shares of Common Stock for a consideration other than cash immediately prior to the close of business on the date fixed for the determination of security holders entitled to receive such shares, and the value of the consideration allocable to such shares of Common Stock shall be determined as provided in Section 5. 5.3.3. The number of shares of Common Stock at any one time outstanding shall be deemed to include the aggregate maximum number of shares issuable (asubject to readjustment upon the actual issuance thereof) upon the exercise of options, rights or warrants and upon the conversion or exchange of convertible or exchangeable securities. 5.3.4. Upon each adjustment of the Exercise Price pursuant to this Section 5, the number of shares of Common Stock receivable upon the exercise of each Warrant shall be the number derived by multiplying the number of shares of Common Stock receivable immediately prior to such adjustment by the Exercise Price in effect prior to such adjustment and dividing the product so obtained by the applicable adjusted Exercise Price. a. In case of any reclassification or change of outstanding shares of Common Stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of subdivision or combination), or in case of any 6 consolidation or merger of the Company with or into another corporation (other than a merger with a subsidiary in which merger the Company is the continuing corporation and which does not result in any reclassification or change of the then outstanding shares of Common Stock or other capital stock issuable upon exercise of the Warrants other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of subdivision or combination) or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, then, as a condition of such reclassification, change, consolidation, merger, sale or conveyance, the Company, or such successor or purchasing corporation, as the case may be, shall make lawful and adequate provision whereby the Holder of each Warrant then outstanding shall have the right thereafter to receive on exercise of such Warrant the kind and amount of securities and property receivable upon such reclassification, change, consolidation, merger, sale or conveyance by a holder of the number of securities issuable upon exercise of such Warrant immediately prior to such reclassification, change, consolidation, merger, sale or conveyance and shall forthwith file at the corporate office of the stock transfer agent, if any, a statement signed by its Chief Executive Officer, President or a Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary evidencing such provision. b. After each adjustment of the Exercise Price pursuant to this Section 5, the Company will promptly prepare a certificate signed by the Chairman, Chief Executive Officer or President, and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary, of the Company setting forth: (i) the Exercise Price as so adjusted, (ii) the number of shares of Common Stock receivable upon exercise of each Warrant, after such adjustment, and (iii) a brief statement of the facts accounting for such adjustment. The Company will promptly cause a brief summary thereof to be sent by ordinary first class mail to each Holder at his last address as it shall appear on the registry books of the Company. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity thereof except as to the Holder to whom the Company failed to mail such notice, or except as to the Holder whose notice was defective. The affidavit of the Secretary or an Assistant Secretary of the Company that such notice has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. c. No adjustment of the Exercise Price shall be made as a result of or in connection with the issuance or sale of shares of Common Stock (pursuant to options, warrants, stock purchase agreements and convertible or of other exchangeable securities deemed hereunder outstanding or in effect on the date hereof or hereafter. In addition, Holders shall not be entitled to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received dividends paid by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold prior to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights any Warrant or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of consideration therefor other than cash deemed to have been received Warrants held by the Company shall be the value of such consideration as determined in good faith by the Board of Directors of the Company on the basis of a record of values of similar property or servicesthem.

Adjustment for Dilutive Events. Except as hereinafter provided, in the event the Company shall, at any time If and whenever on or from time to time after the ------------------------------ original date hereofof issuance of the Series A Preferred the Corporation issues or sells, sell or in accordance with Section 4.3 below is deemed to have issued or sold, any shares of Common Stock for a consideration per share less than the Exercise Conversion Price then in effect, or issue any shares of Common Stock as a stock dividend to (the holders of Common Stock (any such sale or issuance being herein called a "Change of SharesDiluted Share Price"), then, and thereafter immediately before the date of such sale or the record date for each Change of Shares, the Exercise Price for the Warrants (whether or not the same shall be issued and outstanding) shall be adjusted ( to the nearest cent), with such adjusted Exercise Price determined by dividing (1) the product of (a) the Exercise Price in effect immediately before such Change of Shares and (b) the sum of (i) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, and (ii) the number of shares determined by dividing (A) the aggregate consideration, if any, received by the Company upon such sale or issuance by (B) the Exercise Price in effect immediately prior to the time of such Change of Sharesissue or sale (a "Dilutive Event"), by (2) then forthwith upon the total number of shares of Common Stock outstanding immediately after such Change of Shares. For the purposes occurrence of any adjustment to such Dilutive Event the Conversion Price will be made reduced so that the Conversion Price in accordance with this Section 11 effect immediately following the following provisions shall be applicable: (a) In case of Dilutive Event will equal the Diluted Share Price. Notwithstanding the foregoing, the issuance or sale by the Corporation of shares of Common Stock (or of other securities deemed hereunder up to involve the issuance or sale of 3,500,000 shares of Common Stock) for a consideration part or all of which shall be cash, the amount of cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price (before deducting any commissions or any expenses incurred in connection therewith), if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid securities convertible into or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold options to underwriters or dealers for public offering without a subscription offering, or (iii) the gross 13 14 amount of cash actually received by the Company for such securities, in any other case. (b) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder acquire up to involve the issuance or sale of 3,500,000 shares of Common Stock) for a consideration part , issued pursuant to stock option plans or all of which shall be other than cash, the amount of consideration therefor other than cash deemed grants to have been received by the Company shall be the value of such consideration as determined in good faith officers or employees approved by the Board or the issuance of Directors Common Stock pursuant to the Warrants issued pursuant to the Securities Purchase Agreement shall not constitute a Dilutive Event. As used in this Section 4.2(b) and in Section 4.3 below, the term "Common Stock" shall include Common Stock Equivalents. Notwithstanding anything contained herein to the contrary, the Conversion Price of Series A Preferred held by a particular holder shall not be adjusted pursuant to this Section 4 in connection with a particular Dilutive Event, or any subsequent Dilutive Event, if such holder of Series A Preferred fails to purchase, after being offered by the Corporation the opportunity to purchase, a percentage of the Company securities, rights or options, or any combination thereof, the sale of which constitute the Dilutive Event, which is equal to or greater than 75 % of the percentage ownership of the Corporation's Common Stock on a fully diluted basis held by such holder immediately prior to such Dilutive Event. Series A Preferred which is no longer subject to adjustment as a result of the basis preceding sentence shall remain subject to such limitation regardless of a record any subsequent transfers, and at each time that any Series A Preferred so loses its rights to such adjustment, all shares of values Series A Preferred which have lost their right to such adjustment as of similar property such time shall be automatically classified into (and the outstanding certificates representing such Series A Preferred will automatically be deemed to represent) new sub-series X-0, X-0, X-0, etc., consecutively, beginning with A-1. The holders of shares of each such sub-series shall promptly deliver the certificate(s) representing such stock to the Corporation upon the Corporation's request, for exchange or servicesnotation to reflect such sub-series. If any such certificates are not delivered to the Corporation, the Corporation shall make appropriate notations on its stock records, which may include stop transfer instructions, and may place in escrow, pending receipt of such certificates, all dividend payments or other distributions owing with respect to the shares represented by such certificates.