Common use of Subsequent Financing Clause in Contracts

Subsequent Financing. If, at any time prior to July 30, 2005, the Company shall issue any shares of Common Stock in a non-public capital raising transaction (a "Financing Transaction") at a price per share less than the Per Share Purchase Price, then each Purchaser shall be entitled to receive, in connection with the closing of the Financing Transaction, an additional number of shares of Common Stock (the "Adjustment Shares") determined by subtracting (i) the number of Shares received by such Purchaser pursuant to this Agreement at Closing, from (ii) the number of shares of Common Stock determined by dividing such Purchaser's aggregate Purchase Price paid at Closing by the per share purchase price in the Financing Transaction, rounded down to the nearest whole share; provided, however, that in no event shall an issuance be deemed to constitute a Financing Transaction if the primary purpose of such equity financing is not to raise equity capital; provided, further, that the issuance of any Adjustment Shares to any Purchaser in connection with the closing of a Financing Transaction shall be subject to the receipt of appropriate consents of and approvals by the Company's board of directors and shall be subject to the availability of an exemption from registration under the Securities Act. Notwithstanding anything in this Section 4.11 to the contrary, no Adjustment Shares shall be issuable, and no Purchaser shall be entitled to any Adjustment Shares, to the extent that as a result of said issuance in excess of 6,135,108 shares of Common Stock (19.99% of the Common Stock issued and outstanding on the date hereof, which number shall be subject to readjustment for any stock split, stock dividend or reclassification of the Common Stock) (the "20% Cap") would be issued pursuant to this Section 4.11. In such event, each Purchaser shall be entitled to receive the number of Additional Shares equal to such Purchaser's pro rata share of the 20% Cap (based upon its aggregate Purchase Price hereunder).

Subsequent Financing. IfFrom the date hereof until the date that is the later of (i) the closing of the transactions whereby Yotta Merger Sub, at Inc. will merge with and into the Company, with the Company as the surviving company (the “Merger”); and (ii) 12 month anniversary of the initial closing pursuant to the Section 2(a) of this Agreement, upon a Subsequent Financing, Investor shall have the right to participate in any time financing, up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing (the “Participation Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing. Following the Merger, the Participation Maximum shall be 50% of the Subsequent Financing. At least five (5) Trading Days prior to July 30, 2005the closing of the Subsequent Financing, the Company shall issue any shares deliver to Investor a written notice of Common Stock in its intention to effect a nonSubsequent Financing (“Pre-public capital raising transaction (a "Financing Transaction") at a price per share less than Notice”), which Pre-Notice shall ask such Investor if it wants to review the Per Share Purchase Price, then each Purchaser shall be entitled to receive, in connection with the closing of the Financing Transaction, an additional number of shares of Common Stock (the "Adjustment Shares") determined by subtracting (i) the number of Shares received by such Purchaser pursuant to this Agreement at Closing, from (ii) the number of shares of Common Stock determined by dividing such Purchaser's aggregate Purchase Price paid at Closing by the per share purchase price in the Financing Transaction, rounded down to the nearest whole share; provided, however, that in no event shall an issuance be deemed to constitute a Financing Transaction if the primary purpose details of such equity financing (such additional notice, a “Subsequent Financing Notice”). Upon the request of Investor, and only upon a request by Investor, for a Subsequent Financing Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice to Investor. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing, including the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing is not proposed to raise equity capital; provided, further, that the issuance of any Adjustment Shares to any Purchaser in connection with the closing of a Financing Transaction shall be subject to the receipt of appropriate consents of and approvals by the Company's board of directors effected and shall be subject to the availability of include a term sheet or similar document relating thereto as an exemption from registration under the Securities Act. Notwithstanding anything in this Section 4.11 to the contrary, no Adjustment Shares shall be issuable, and no Purchaser shall be entitled to any Adjustment Shares, to the extent that as a result of said issuance in excess of 6,135,108 shares of Common Stock (19.99% of the Common Stock issued and outstanding on the date hereof, which number shall be subject to readjustment for any stock split, stock dividend or reclassification of the Common Stock) (the "20% Cap") would be issued pursuant to this Section 4.11. In such event, each Purchaser shall be entitled to receive the number of Additional Shares equal to such Purchaser's pro rata share of the 20% Cap (based upon its aggregate Purchase Price hereunder)attachment.

Subsequent Financing. If, at any time prior During the period commencing on the Closing Date and expiring on the first to July 30, 2005, the Company shall issue any shares occur of Common Stock in a non-public capital raising transaction (a "Financing Transaction") at a price per share less than the Per Share Purchase Price, then each Purchaser shall be entitled to receive, in connection with the closing of the Financing Transaction, an additional number of shares of Common Stock (the "Adjustment Shares") determined by subtracting (i) the number twelve (12) month anniversary of Shares received by such Purchaser pursuant to this Agreement at Closing, from the Effective Date of the Registration Statement or (ii) the number twenty-four (24) month anniversary of shares the Closing Date, the Company will not, directly or indirectly, effect a subsequent financing (a “Subsequent Financing”) of Common Stock determined by dividing its securities (whether structured as debt or equity), unless in each such Purchaser's aggregate Purchase Price paid at Closing by case the per share purchase price Company shall have first offered to sell to the Subscribers in this Offering, in the aggregate, an amount of the securities offered in such Subsequent Financing Transaction, rounded down equal to the nearest whole share; provided, however, that in no event shall an issuance be deemed to constitute a Financing Transaction if the primary purpose of such equity financing is not to raise equity capital; provided, further, that the issuance of any Adjustment Shares to any Purchaser in connection with the closing of a Financing Transaction shall be subject to the receipt of appropriate consents of and approvals by the Company's board of directors and shall be subject to the availability of an exemption from registration under the Securities Act. Notwithstanding anything in this Section 4.11 to the contrary, no Adjustment Shares shall be issuable, and no Purchaser shall be entitled to any Adjustment Shares, to the extent that as a result of said issuance in excess of 6,135,108 shares of Common Stock (19.9950% of the Common Stock issued and outstanding on the date hereof, which number shall be subject to readjustment for any stock split, stock dividend or reclassification of the Common Stock) securities offered in such Subsequent Financing (the "20% Cap") would securities to be issued offered to Subscribers pursuant to this Section 4.11being referred to herein in the “Offered Securities”). In The Company shall offer to sell to each Subscriber (A) such event, each Purchaser shall be entitled to receive the number of Additional Shares equal to such Purchaser's Subscriber’s pro rata share of the 20% Cap Offered Securities (based upon its aggregate Purchase Price hereunderthe “Basic Amount”), and (B) such additional portion of the Offered Securities as such Subscriber shall indicate it will purchase should the other Subscribers subscribe for less than their Basic Amounts (the “Undersubscription Amount”), at a price and on such other terms as shall have been specified by the Company in writing delivered to such Subscriber (the “Participation Notice”). The Company shall deliver the Participation Notice to the Subscribers at least 5 business days prior to the closing of the Subsequent Financing. Any Subscriber desiring to participate in such Subsequent Financing must provide written notice to the Company by not later than 5:30 p.m. (New York City time) on the 3rd business day following the date that the Company delivered such Participation Notice (the “Notice Period”) (calculated in accordance with the notice provisions set forth below in Section 7.7).

Subsequent Financing. IfFor a period of three (3) years following the Closing Date so long as the Preferred Shares remain outstanding, the Company covenants and agrees to promptly notify (in no event later than three (3) business days after making or receiving an applicable offer) each Purchaser in writing (a “Rights Notice”) of the terms and conditions of any proposed offer or sale to, or exchange with (or other type of distribution to) any person (the “New Purchaser”), of Common Stock or any debt or equity securities convertible, exercisable or exchangeable into Common Stock (a “Subsequent Financing”). The Rights Notice shall describe, in reasonable detail, the proposed Subsequent Financing, the names and investment amounts of all investors participating in the Subsequent Financing (if known), the proposed closing date of the Subsequent Financing, which shall be within ten (10) calendar days from the date of the Rights Notice, and all of the terms and conditions thereof and proposed definitive documentation to be entered into in connection therewith. The Rights Notice shall provide each Purchaser an option (the “Rights Option”) during the five (5) Trading Days following delivery of the Rights Notice (the “Option Period”) to elect to purchase securities in the form of the securities being offered in such Subsequent Financing up to an additional amount of such securities that will permit such Purchaser to maintain its proportionate ownership interest in the Company. Proportionate ownership shall be determined on a fully diluted basis, without giving effect to any limitations on exercise set forth in the Preferred Shares, the Warrants or any other securities of the Company (including the securities to be issued in the Subsequent Financing). Such acquisition to be on the same, absolute terms and conditions as contemplated by such Subsequent Financing. Delivery of any Rights Notice constitutes a representation and warranty by the Company that there are no other material terms and conditions, arrangements, agreements or otherwise except for those disclosed in the Rights Notice, to provide additional compensation to any party participating in any proposed Subsequent Financing, including, but not limited to, additional compensation based on changes in the Purchase Price or any type of reset or adjustment of a purchase or conversion price or to issue additional securities at any time prior after the closing date of a Subsequent Financing. If the Company receives notice of exercise of the Rights Option from the Purchaser within the Option Period, it shall make provision in such Subsequent Financing for the issuance to July 30the Purchaser of the securities required hereunder (it being understood that such securities hall be in addition to the securities to be issued to the New Purchaser, 2005not in lieu of such securities). If the Company does not receive notice of exercise of the Rights Option from the Purchaser within the Option Period, the Company shall issue any shares have the right to close the Subsequent Financing on the scheduled closing date with the New Purchaser; provided that all of Common Stock the material terms and conditions of the closing are the same as those provided to the Purchaser in a non-public capital raising transaction (a "Financing Transaction") at a price per share less than the Per Share Purchase Price, then each Purchaser shall be entitled to receive, in connection with Rights Notice. If the closing of the proposed Subsequent Financing Transactiondoes not occur on that date, an additional number of shares of Common Stock (the "Adjustment Shares") determined by subtracting (i) the number of Shares received by such Purchaser pursuant to this Agreement at Closing, from (ii) the number of shares of Common Stock determined by dividing such Purchaser's aggregate Purchase Price paid at Closing by the per share purchase price in the Financing Transaction, rounded down to the nearest whole share; provided, however, that in no event shall an issuance be deemed to constitute a Financing Transaction if the primary purpose of such equity financing is not to raise equity capital; provided, further, that the issuance of any Adjustment Shares to any Purchaser in connection with the closing of a the contemplated Subsequent Financing Transaction or any other Subsequent Financing shall be subject to all of the receipt provisions of appropriate consents of and approvals by the Company's board of directors and shall be subject to the availability of an exemption from registration under the Securities Act. Notwithstanding anything in this Section 4.11 to 3.17, including, without limitation, the contrary, no Adjustment Shares shall be issuable, and no Purchaser shall be entitled to any Adjustment Shares, to the extent that as delivery of a result new Rights Notice. The provisions of said issuance in excess of 6,135,108 shares of Common Stock (19.99% of the Common Stock issued and outstanding on the date hereof, which number shall be subject to readjustment for any stock split, stock dividend or reclassification of the Common Stock) (the "20% Cap") would be issued pursuant to this Section 4.11. In such event, each Purchaser 3.17 shall be entitled not apply to receive Permitted Issuances (as defined in the number of Additional Shares equal to such Purchaser's pro rata share of the 20% Cap (based upon its aggregate Purchase Price hereunderWarrants).

Subsequent Financing. IfFrom the date hereof until the date that is the later of (i) the closing of the transactions whereby Yotta Merger Sub, at Inc. will merge with and into the Company, with the Company as the surviving company (the “Merger”); and (ii) 12 month anniversary of the First Settlement Date, upon a Subsequent Financing, Investor shall have the right to participate in any time financing, up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing (the “Participation Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing. Following the Merger, the Participation Maximum shall be 50% of the Subsequent Financing. At least five (5) Trading Days prior to July 30, 2005the closing of the Subsequent Financing, the Company shall issue any shares deliver to Investor a written notice of Common Stock in its intention to effect a nonSubsequent Financing (“Pre-public capital raising transaction (a "Financing Transaction") at a price per share less than Notice”), which Pre-Notice shall ask such Investor if it wants to review the Per Share Purchase Price, then each Purchaser shall be entitled to receive, in connection with the closing of the Financing Transaction, an additional number of shares of Common Stock (the "Adjustment Shares") determined by subtracting (i) the number of Shares received by such Purchaser pursuant to this Agreement at Closing, from (ii) the number of shares of Common Stock determined by dividing such Purchaser's aggregate Purchase Price paid at Closing by the per share purchase price in the Financing Transaction, rounded down to the nearest whole share; provided, however, that in no event shall an issuance be deemed to constitute a Financing Transaction if the primary purpose details of such equity financing (such additional notice, a “Subsequent Financing Notice”). Upon the request of Investor, and only upon a request by Investor, for a Subsequent Financing Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice to Investor. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing, including the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing is not proposed to raise equity capital; provided, further, that the issuance of any Adjustment Shares to any Purchaser in connection with the closing of a Financing Transaction shall be subject to the receipt of appropriate consents of and approvals by the Company's board of directors effected and shall be subject to the availability of include a term sheet or similar document relating thereto as an exemption from registration under the Securities Act. Notwithstanding anything in this Section 4.11 to the contrary, no Adjustment Shares shall be issuable, and no Purchaser shall be entitled to any Adjustment Shares, to the extent that as a result of said issuance in excess of 6,135,108 shares of Common Stock (19.99% of the Common Stock issued and outstanding on the date hereof, which number shall be subject to readjustment for any stock split, stock dividend or reclassification of the Common Stock) (the "20% Cap") would be issued pursuant to this Section 4.11. In such event, each Purchaser shall be entitled to receive the number of Additional Shares equal to such Purchaser's pro rata share of the 20% Cap (based upon its aggregate Purchase Price hereunder)attachment.