STOCK UPON THE TRANSMISSION OF A
CONVERSION NOTICE.
IN THE EVENT OF A PARTIAL CONVERSION OF THIS DEBENTURE
PURSUANT HERETO, THE PRINCIPAL AMOUNT CONVERTED SHALL BE DEDUCTED FROM THE
INSTALLMENT AMOUNTS RELATING TO THE INSTALLMENT DATES AS SET FORTH IN THE
CONVERSION NOTICE.
(II)
COMPANY'S FAILURE TO TIMELY CONVERT.
IF WITHIN THREE (3) TRADING
DAYS AFTER THE COMPANY'S RECEIPT OF THE FACSIMILE COPY OF A CONVERSION NOTICE
THE COMPANY SHALL FAIL TO ISSUE AND DELIVER A CERTIFICATE TO THE HOLDER OR
CREDIT THE HOLDER'S BALANCE ACCOUNT WITH DTC FOR THE NUMBER OF SHARES OF COMMON
STOCK TO WHICH THE HOLDER IS ENTITLED UPON SUCH HOLDER'S CONVERSION OF ANY
CONVERSION AMOUNT (A "CONVERSION FAILURE"), AND IF ON OR AFTER SUCH TRADING DAY
THE HOLDER PURCHASES (IN AN OPEN MARKET TRANSACTION OR OTHERWISE) COMMON STOCK
TO DELIVER IN SATISFACTION OF A SALE BY THE HOLDER OF COMMON STOCK ISSUABLE UPON
SUCH CONVERSION THAT THE HOLDER ANTICIPATED RECEIVING FROM THE COMPANY (A
"BUY-IN"), THEN THE COMPANY SHALL, WITHIN THREE (3) BUSINESS DAYS AFTER THE
HOLDER'S REQUEST AND IN THE HOLDER'S DISCRETION, EITHER (I) PAY CASH TO THE
HOLDER IN AN AMOUNT EQUAL TO THE HOLDER'S TOTAL PURCHASE PRICE (INCLUDING
BROKERAGE COMMISSIONS AND OTHER OUT OF POCKET EXPENSES, IF ANY) FOR THE SHARES
OF COMMON STOCK SO PURCHASED (THE "BUY-IN PRICE"), AT WHICH POINT THE COMPANY'S
OBLIGATION TO DELIVER SUCH CERTIFICATE (AND TO ISSUE SUCH COMMON STOCK) SHALL
TERMINATE, OR (II) PROMPTLY HONOR ITS OBLIGATION TO DELIVER TO THE HOLDER A
CERTIFICATE OR CERTIFICATES REPRESENTING SUCH COMMON STOCK AND PAY CASH TO THE
HOLDER IN AN AMOUNT EQUAL TO THE EXCESS (IF ANY) OF THE BUY-IN PRICE OVER THE
PRODUCT OF (A) SUCH NUMBER OF SHARES OF COMMON STOCK, TIMES (B) THE CLOSING BID
PRICE ON THE CONVERSION DATE.
(III)
BOOK-ENTRY.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH
HEREIN, UPON CONVERSION OF ANY PORTION OF THIS DEBENTURE IN ACCORDANCE WITH THE
TERMS HEREOF, THE HOLDER SHALL NOT BE REQUIRED TO PHYSICALLY SURRENDER THIS
DEBENTURE TO THE COMPANY UNLESS (A) THE FULL CONVERSION AMOUNT REPRESENTED BY
THIS DEBENTURE IS BEING CONVERTED OR (B) THE HOLDER HAS PROVIDED THE
COMPANY WITH PRIOR WRITTEN NOTICE (WHICH NOTICE MAY BE INCLUDED IN A CONVERSION
NOTICE) REQUESTING REISSUANCE OF THIS DEBENTURE UPON PHYSICAL SURRENDER OF THIS
DEBENTURE.
THE HOLDER AND THE COMPANY SHALL MAINTAIN RECORDS SHOWING THE
PRINCIPAL AND INTEREST CONVERTED AND THE DATES OF SUCH CONVERSIONS OR SHALL USE
SUCH OTHER METHOD, REASONABLY SATISFACTORY TO THE HOLDER AND THE COMPANY, SO AS
NOT TO REQUIRE PHYSICAL SURRENDER OF THIS DEBENTURE UPON CONVERSION.
(C)
LIMITATIONS ON CONVERSIONS.
(I)
BENEFICIAL OWNERSHIP.
THE COMPANY SHALL NOT EFFECT ANY
CONVERSIONS OF THIS DEBENTURE AND THE HOLDER SHALL NOT HAVE THE RIGHT TO CONVERT
ANY PORTION OF THIS DEBENTURE OR RECEIVE SHARES OF COMMON STOCK AS PAYMENT OF
INTEREST HEREUNDER TO THE EXTENT THAT AFTER GIVING EFFECT TO SUCH CONVERSION OR
RECEIPT OF SUCH INTEREST PAYMENT, THE HOLDER, TOGETHER WITH ANY AFFILIATE
THEREOF, WOULD BENEFICIALLY OWN (AS DETERMINED IN ACCORDANCE WITH SECTION