(3) FIFTY PERCENT (50%)
IF SUCH BLACKOUT NOTICE IS DELIVERED ON OR AFTER THE TENTH (10TH) TRADING DAY
FOLLOWING SUCH SETTLEMENT DATE, BUT PRIOR TO THE FIFTEENTH (15TH) TRADING DAY
FOLLOWING SUCH SETTLEMENT DATE; AND (4) ZERO PERCENT (0%) THEREAFTER OF: THE
PRODUCT OF (I) THE NUMBER OF REGISTRABLE SECURITIES PURCHASED BY THE INVESTOR
PURSUANT TO THE MOST RECENT DRAW DOWN AND ACTUALLY HELD BY THE INVESTOR
IMMEDIATELY PRIOR TO THE BLACKOUT PERIOD AND (II) THE RESULT, IF GREATER THAN
ZERO, OBTAINED BY SUBTRACTING THE NEW VWAP FROM THE OLD VWAP; PROVIDED, HOWEVER,
THAT NO BLACKOUT AMOUNT SHALL BE PAYABLE IN RESPECT OF REGISTRABLE SECURITIES
(X) THAT ARE OTHERWISE FREELY TRADABLE BY THE INVESTOR, INCLUDING UNDER
RULE 144, DURING THE BLACKOUT PERIOD OR (Y) IF THE COMPANY OFFERS TO REPURCHASE
FROM THE INVESTOR SUCH REGISTRABLE SECURITIES FOR A PER SHARE PURCHASE PRICE
EQUAL TO THE VWAP ON THE TRADING DAY IMMEDIATELY PRECEDING THE DAY ON WHICH ANY
SUCH BLACKOUT PERIOD BEGAN.
FOR ANY BLACKOUT PERIOD IN RESPECT OF WHICH A
BLACKOUT AMOUNT BECOMES DUE AND PAYABLE, RATHER THAN PAYING THE BLACKOUT AMOUNT,
THE COMPANY MAY AT IS SOLE DISCRETION, ISSUE TO THE INVESTOR SHARES OF COMMON
STOCK WITH AN AGGREGATE MARKET VALUE DETERMINED AS OF THE FIRST TRADING DAY
FOLLOWING SUCH BLACKOUT PERIOD EQUAL TO THE BLACKOUT AMOUNT ("BLACKOUT SHARES");
PROVIDED THAT THE INVESTOR MAY SELL SUCH BLACKOUT SHARES PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT.
(F)
LIQUIDATED DAMAGES.
THE COMPANY AND THE INVESTOR HERETO ACKNOWLEDGE
AND AGREE THAT THE AMOUNTS PAYABLE UNDER SECTIONS 1.1(D) AND 1.1(E) AND THE
BLACKOUT SHARES DELIVERABLE UNDER SECTION 1.1(E) ABOVE SHALL CONSTITUTE
LIQUIDATED DAMAGES AND NOT PENALTIES.
THE PARTIES FURTHER ACKNOWLEDGE THAT
(I) THE AMOUNT OF LOSS OR DAMAGES LIKELY TO BE INCURRED BY
3
THE INVESTOR IS INCAPABLE OR IS DIFFICULT TO PRECISELY ESTIMATE, (II) THE
AMOUNTS SPECIFIED IN SUCH SUBSECTIONS BEAR A REASONABLE PROPORTION AND ARE NOT
PLAINLY OR GROSSLY DISPROPORTIONATE TO THE PROBABLE LOSS LIKELY TO BE INCURRED
IN CONNECTION WITH ANY FAILURE BY THE COMPANY TO OBTAIN OR MAINTAIN THE
EFFECTIVENESS OF THE REGISTRATION STATEMENT, (III) ONE OF THE REASONS FOR THE
COMPANY AND THE INVESTOR REACHING AN AGREEMENT AS TO SUCH AMOUNTS WAS THE
UNCERTAINTY AND COST OF LITIGATION REGARDING THE QUESTION OF ACTUAL DAMAGES, AND
(IV) THE COMPANY AND THE INVESTOR ARE SOPHISTICATED BUSINESS PARTIES AND HAVE
BEEN REPRESENTED BY SOPHISTICATED AND ABLE LEGAL AND FINANCIAL COUNSEL AND
NEGOTIATED THIS AGREEMENT AT ARM'S LENGTH.
THE INVESTOR AGREES THAT, SO LONG AS
THE COMPANY MAKES THE PAYMENTS OR DELIVERIES PROVIDED FOR IN SECTIONS 1.1(D) OR
1.1(E), AS APPLICABLE, THE COMPANY'S FAILURE TO MAINTAIN THE EFFECTIVENESS,
DEFERRAL OR SUSPENSION OF THE REGISTRATION STATEMENT THAT TRIGGERED SUCH
PAYMENTS OR DELIVERIES SHALL NOT CONSTITUTE A MATERIAL BREACH OR DEFAULT OF ANY
OBLIGATION OF THE COMPANY TO THE INVESTOR AND SUCH PAYMENTS OR DELIVERIES SHALL
CONSTITUTE THE INVESTOR'S SOLE REMEDIES WITH RESPECT THERETO.
(G)
ADDITIONAL REGISTRATION STATEMENTS.
IN THE EVENT AND TO THE EXTENT
THAT THE REGISTRATION STATEMENT FAILS TO REGISTER A SUFFICIENT