Cashless Exercise During Period of Default Clause Samples

Cashless Exercise During Period of Default. Notwithstanding any other provision contained herein to the contrary, from and after the first anniversary of the Closing Date and so long as the Company is required under the Registration Rights Agreement to have effected the registration of the Warrant Shares for resale to the public pursuant to a Registration Statement (as such term is defined in the Registration Rights Agreement), if the Warrant Shares may not be freely sold to the public due to the failure of the Company to have effected the registration of the Warrant Shares or to have a current prospectus available for delivery or otherwise, in each case as required by the Securities Purchase Agreement, the Holder may elect to receive, without the payment by the Holder of the aggregate Warrant Price in respect of the shares of Common Stock to be acquired, shares of Common Stock of equal value to the value of this Warrant, or any specified portion hereof, by the surrender of this Warrant (or such portion of this Warrant being so exercised) together with a Net Issue Election Notice, in the form annexed hereto as Appendix A with appropriate modification to reflect such Net Issue Election, duly executed, to the Company. Thereupon, the Company shall issue to the Holder such number of fully paid, validly issued and nonassessable shares of Common Stock as is computed using the following formula: X = Y (A - B) where X = the number of shares of Common Stock to which the Holder is entitled upon such cashless exercise; Y = the total number of shares of Common Stock covered by this Warrant for which the Holder has surrendered purchase rights at such time for cashless exercise (including both shares to be issued to the Holder and shares as to which the purchase rights are to be canceled as payment therefor); A = the Market Price of one share of Common Stock as at the date the net issue election is made; and B = the Warrant Price in effect under this Warrant at the time the net issue election is made.