Document:

EXHIBIT
10.2

    

    AMENDED AND RESTATED
FINANCIAL SERVICES AGREEMENT

     

    This
Restated Financial Services Agreement (this “Agreement”) is made as of
March 1, 2010 by and between Savoy Energy Corporation (the “Company”), Excelsus Capital
Partners, LLC (“Partners”) (each a “Party” and collectively
referred to hereafter as the “Parties”).

    

    WITNESSETH:

    

    WHEREAS,
the Company has previously entered into Financial Services Agreements with
Partners dated as of November 19, 2009 and January 20, 2010 (collectively, the
“Prior Agreements”) whereby Partners agreed to serve as the Company’s corporate
finance and strategic advisor on the terms and for the services specified in the
Prior Agreements;

     

    WHEREAS,
the Parties now recognize that the scope of services provided and to be provided
by Partners under the terms of the Prior Agreements is greater that the Parties
anticipated at the time the Company entered into the Prior Agreements and that
it is fair and appropriate for Partners to be paid compensation in addition to
the consideration which was stated in the Prior Agreements;

     

    WHEREAS,
the Parties intend by this Agreement to restate the terms of the Prior
Agreements and to proceed forward based upon the terms of this
Agreement.

     

    NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein
contained and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Parties, intending to be legally
bound, hereby agree in good faith as follows:

     

    1.              Definitions.  Unless
otherwise defined in this Agreement, terms appearing in initial capitalized form
shall have the meaning ascribed to such terms in this.

     

    2.              Services.  The
Services, which Partners shall provide under this Agreement, shall include the
following:

     

    (a)           Partners
will familiarize itself to the extent it deems appropriate with the business,
operations, financial condition and prospects of the Company;

     

    (b)           Partners
will work with the Company to develop and implement strategies with respect to
the restructuring of certain of its financial obligations;

     

    (c)           Partners
will work with the Company to develop a strategic plan to access additional
capital and finance in the most efficient manner possible;

     

    (d)           Partners
will identify potential investors which might have an interest in evaluating
participation in various contemplated financing transactions; and

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (e)           Partners
will assist the Company in preparing and analyzing a broad range of Strategic
Options.

     

    Partners
is not a licensed broker-dealer.  Under no circumstances will Partners
engage in any activities which would require licensure as a broker-dealer or
otherwise.

     

    3.            
Term and
Termination. The term of this engagement shall be for a period commencing
with the date of this Agreement and ending twelve (12) months from the date
hereof and may only be extended upon the mutual written agreement of the
Parties.

     

    4.             Consideration.  In
consideration for Partners providing the services set forth in Section 2 above,
the Company has previously issued 2,000,000 shares of the Common Stock to
Partners and coincident with the execution of this Agreement will issue another
2,000,000 shares of the Company’s Common Stock to Partners (the aggregate number
of shares issued to Partners in connection with this Financial Services
Agreement being 4,000,000 shares) (the “Partners’
Shares”).  The Partners’ Shares shall be deemed to be fully
earned upon receipt.

     

    Under no
circumstances shall the shares issued to Partners hereunder equal or exceed five
per cent (5%) to the total then issued and outstanding shares of Common Stock of
the Company.  For all purposes, the Partners’ Shares issued pursuant
to this Agreement shall be deemed to have an aggregate initial value of
$140,000.00.

     

    5.             Non-Exclusive
Relationship.  The services of Partners shall be rendered on a
non-exclusive basis.

     

    6.             Notices.  All
notices, requests, demands, claims, and other communications hereunder shall be
in writing.  Any notice, request, demand, claim or other communication
hereunder shall be deemed duly delivered four business days after it is sent by
registered or certified mail, return receipt requested, postage prepaid, or one
business day after it is sent for next business day delivery via a reputable
nationwide overnight courier service, in each case to the intended recipient as
set forth below:

     

    
      If to Partners:

       

      Excelsus
Capital Partners LLC

      53 W
Palisade Ave (PH-2)

      Englewood,
NJ 07631

       

      
        If to the Company:

         

        Savoy
Energy Corporation

        11200
Westheimer

        Suite
200

        Houston,
TX 77042

         

        
          
             

          

          
             

            
              

            

          

          
             

          

        

         

        
          Attn:  Arthur
Bertagnolli

           

          Copy to:

           

          Law
Offices of Robert Diener

          122 Ocean
Park Boulevard

          Suite
307

          Santa
Monica, California 90405

          Facsimile:
(310) 362-8887

          Attention:
Robert Diener

        

         

      

    

    Any Party
may give any notice, request, demand, claim or other communication hereunder
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail or electronic mail), but no such notice,
request, demand, claim or other communication shall be deemed to have been duly
given unless and until it actually is received by the party for whom it is
intended.  Any party may change the address to which notices,
requests, demands, claims, and other communications hereunder are to be
delivered by giving the other party notice in the manner herein set
forth.

     

    7.             Miscellaneous.

     

    (a)           Entire
Agreement.  This Agreement constitutes the entire agreement
among the Parties and supersedes any prior understandings, agreements or
representations by or among the Parties, written or oral, with respect to the
subject matter hereof.

     

    (b)           Succession and
Assignment.  This Agreement shall be binding upon and inure to
the benefit of the Parties named herein and their respective successors and
permitted assigns.  No Party may assign either this Agreement or any
of its rights, interests or obligations hereunder without the prior written
approval of the other party.

     

    (c)           Counterparts and Facsimile
Signature.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.  This Agreement
may be executed by facsimile signature.

     

    (d)           Headings.  The
section headings contained in this Agreement are inserted for convenience only
and shall not affect in any way the meaning or interpretation of this
Agreement.

     

    (e)           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New Jersey without giving
effect to any choice or conflict of law provision or rule (whether of the State
of New Jersey or any other jurisdiction) that would cause the application of
laws of any jurisdictions other than those of the State of New
Jersey.  The Parties hereby consent to the exclusive jurisdiction of
the courts of the State of New Jersey and the United States District Court for
the District of New Jersey for all disputes arising under this
Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)           Amendments and
Waivers.  The Parties may mutually amend any provision of this
Agreement at any time during the term of this Agreement prior to the termination
of this Agreement.  No amendment of any provision of this Agreement
shall be valid unless the same shall be in writing and signed by the
Parties.  No waiver of any right or remedy hereunder shall be valid
unless the same shall be in writing and signed by the party giving such
waiver.  No waiver by any party with respect to any default,
misrepresentation or breach of warranty or covenant hereunder shall be deemed to
extend to any prior or subsequent default, misrepresentation or breach of
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence.

     

    (g)           Severability.  Any
term or provision of this Agreement that is invalid or unenforceable in any situation in any
jurisdiction shall not affect the validity or enforceability of the remaining
terms and provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other
jurisdiction.  If the final judgment of a court of competent
jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the Parties agree that the court making the determination of
invalidity or unenforceability shall have the power to limit the term or
provision, to delete specific words or phrases, or to replace any invalid or
unenforceable term or provision with a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the invalid or
unenforceable term or provision, and this Agreement shall be enforceable as so
modified.

     

    (h)           Construction.  The
language used in this Agreement shall be deemed to be the language chosen by the
Parties to express their mutual intent, and no rule of strict construction shall
be applied against any party.  Any reference to any federal, state,
local or foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires
otherwise.

     

    (i)           Remedies. Partners shall be
entitled to enforce its rights under this Agreement specifically to recover
damages by reason of any breach of any provision or term of this Agreement and
to exercise all other rights existing in its favor.  In the event of
any dispute under this Agreement, the prevailing party shall be entitled to
recover its costs incurred in connection with the resolution thereof, including
reasonable attorneys fees.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as an
instrument under seal as of the date first written above.

     

    
      
        
          
            	
                    Excelsus
      Capital Partners, LLC

                  	
                    Savoy
      Energy Corporation

                  
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                    By:_____________________

                  	
                    By:____________________________

                  
	
                    Name:

                  	
                    Name:
      Arthur Bertagnolli

                  
	
                    Title: Principal

                  	
                          
                      Title:
      PresidentUnassociated Document

    

    EXHIBIT 4.1

     

    COMMON
STOCK PURCHASE WARRANT

     

     __________

    
       

    

    
      	
              Warrant
      Shares:

            	
              _______

            	 
      	
              Initial
      Exercise Date: March ___, 2010

            

    

     

    
      THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies
that, for value received, _____________ (the “Holder”) is entitled,
upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after March __,
2010 (the “Initial Exercise
Date”) and on or prior to the close of business on the five
(5) year anniversary of the Initial Exercise Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Far East Energy
Corporation, a Nevada corporation (the “Company”), up to
______ shares (the “Warrant Shares”) of
Common Stock.  The purchase price of one share of Common Stock under
this Warrant shall be equal to the Exercise Price, as defined in Section
2(b).

       

    

    Section
1.            Definitions.  Capitalized
terms used and not otherwise defined herein shall have the meanings set forth in
that certain Securities Purchase Agreement (the “Purchase Agreement”),
dated March 8, 2010, among the Company and the purchasers signatory
thereto.

     

    Section
2.             Exercise.

     

    a)           Exercise of
Warrant.  Exercise of the purchase rights represented by this
Warrant may be made, in whole or in part, at any time or times on or after the
Initial Exercise Date and on or before the Termination Date by delivery to the
Warrant Agent (or at the office of its successor as Warrant Agent) of a duly
executed facsimile copy of the Notice of Exercise Form annexed hereto; and,
within three (3) Trading Days of the date said Notice of Exercise is delivered
to the Warrant Agent, the Warrant Agent shall have received payment of the
aggregate Exercise Price of the shares thereby purchased by wire transfer or
cashier’s check drawn on a United States bank or, if available, pursuant to the
cashless exercise procedure specified in Section 2(c)
below.  Notwithstanding anything herein to the contrary, the Holder
shall not be required to physically surrender this Warrant to the Warrant Agent
until the Holder has purchased all of the Warrant Shares available hereunder and
the Warrant has been exercised in full, in which case, the Holder shall
surrender this Warrant to the Warrant Agent for cancellation within three (3)
Trading Days of the date the final Notice of Exercise is delivered to the
Warrant Agent.  Partial exercises of this Warrant resulting in
purchases of a portion of the total number of Warrant Shares available hereunder
shall have the effect of lowering the outstanding number of Warrant Shares
purchasable hereunder in an amount equal to the applicable number of Warrant
Shares purchased.  The Holder and the Warrant Agent shall maintain
records showing the number of Warrant Shares purchased and the date of such
purchases.  The Warrant Agent shall deliver any objection to any
Notice of Exercise Form within 1 Business Day of receipt of such
notice.  The Holder
and any assignee, by acceptance of this Warrant, acknowledge and agree that, by
reason of the provisions of this paragraph, following the purchase of a portion
of the Warrant Shares hereunder, the number of Warrant Shares available for
purchase hereunder at any given time may be less than the amount stated on the
face hereof.

    
      
         

      

      
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    b)           Exercise
Price.  The exercise price per share of the Common Stock under
this Warrant shall be $0.80, subject to adjustment hereunder (the “Exercise
Price”).

     

    c)           Cashless
Exercise.  If at the time of exercise hereof there is no
effective registration statement registering, or the prospectus contained
therein is not available for the issuance of the Warrant Shares to the Holder
and all of the Warrant Shares are not then registered for resale by Holder into
the market at market prices from time to time on an effective registration
statement for use on a continuous basis (or the prospectus contained therein is
not available for use), then this Warrant may also be exercised, in whole or in
part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive a certificate for the number of Warrant Shares equal to
the quotient obtained by dividing [(A-B) (X)] by (A), where:

     

    
      	
               
      

            	
              (A)

            	
              =

            	
              the
      VWAP on the Trading Day immediately preceding the date on which Holder
      elects to exercise this Warrant by means of a “cashless exercise,” as set
      forth in the applicable Notice of
Exercise;

            

    

    

    
      	
               
      

            	
              (B)

            	
              =

            	
              the
      Exercise Price of this Warrant, as adjusted hereunder;
  and

            

    

    

    
      	
               
      

            	
              (X)

            	
              =

            	
              the
      number of Warrant Shares that would be issuable upon exercise of this
      Warrant in accordance with the terms of this Warrant if such exercise were
      by means of a cash exercise rather than a cashless exercise, or, if only a
      portion of this Warrant is being exercised, the portion of the Warrant
      being exercised (at the date of such
  calculation).

            

    

    

    “VWAP” means, for any
date, the price determined by the first of the following clauses that applies:
(a) if the Common Stock is then listed or quoted on a Trading Market, the daily
volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed
or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time), (b)  if the OTC
Bulletin Board is not a Trading Market, the volume weighted average price of the
Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
Board, (c) if the Common Stock is not then listed or quoted for trading on the
OTC Bulletin Board and if prices for the Common Stock are then reported in the
“Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or
agency succeeding to its functions of reporting prices), the most recent bid
price per share of the Common Stock so reported, or (d) in all other cases,
the fair market value of a share of Common Stock as determined by an independent
appraiser selected in good faith by the Company and reasonably acceptable to
Holders of a majority in interest of the Warrants then outstanding, the fees and
expenses of which shall be paid by the Company.

    
      
         

      

      
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    d)           Mechanics of
Exercise.

     

    i.      Delivery of Certificates
Upon Exercise.  Certificates for shares purchased hereunder
shall be transmitted by the Transfer Agent to the Holder by crediting the
account of the Holder’s prime broker with the Depository Trust Company through
its Deposit Withdrawal Agent Commission (“DWAC”) system if the
Company is then a participant in such system and either (A) there is an
effective Registration Statement permitting the issuance of the Warrant Shares
to or resale of the Warrant Shares by Holder or (B) this Warrant is being
exercised via cashless exercise, and otherwise by physical delivery to the
address specified by the Holder in the Notice of Exercise by the date that is
three (3) Trading Days after the latest of (A) the delivery to the Warrant Agent
of the Notice of Exercise Form, (B) surrender of this Warrant (if required) and
(C) payment of the aggregate Exercise Price as set forth above (including by
cashless exercise, if permitted) (such date, the “Warrant Share Delivery
Date”).  This Warrant shall be deemed to have been exercised on
the first date on which all of the foregoing have been delivered to the Warrant
Agent.  The Warrant Shares shall be deemed to have been issued, and
Holder or any other person so designated to be named therein shall be deemed to
have become a holder of record of such shares for all purposes, as of the date
the Warrant has been exercised, with payment to the Warrant Agent of the
Exercise Price (or by cashless exercise, if permitted) and all taxes required to
be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior to the
issuance of such shares, having been paid. If the Company fails for any reason
to deliver to the Holder certificates evidencing the Warrant Shares subject to a
Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to
the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000
of Warrant Shares subject to such exercise (based on the VWAP of the Common
Stock on the date of the applicable Notice of Exercise), $10 per Trading Day
(increasing to $20 per Trading Day on the fifth Trading Day after such
liquidated damages begin to accrue) for each Trading Day after such Warrant
Share Delivery Date until such certificates are delivered or Holder rescinds
such exercise.

     

    ii.     Delivery of New Warrants
Upon Exercise.  If this Warrant shall have been exercised in
part, the Warrant Agent shall, at the request of a Holder and upon surrender of
this Warrant certificate, at the time of delivery of the certificate or
certificates representing Warrant Shares, deliver to Holder a new Warrant
evidencing the rights of Holder to purchase the unpurchased Warrant Shares
called for by this Warrant, which new Warrant shall in all other respects be
identical with this Warrant.

    
      
         

      

      
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    iii.           Rescission
Rights.  If the Company fails to cause the Transfer Agent to
transmit to the Holder a certificate or the certificates representing the
Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date,
then the Holder will have the right to rescind such exercise.

     

    iv.           Compensation for Buy-In on
Failure to Timely Deliver Certificates Upon Exercise.  In
addition to any other rights available to the Holder, if the Company fails to
cause the Transfer Agent to transmit to the Holder a certificate or the
certificates representing the Warrant Shares pursuant to an exercise on or
before the Warrant Share Delivery Date, and if after such date the Holder is
required by its broker to purchase (in an open market transaction or otherwise)
or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to
deliver in satisfaction of a sale by the Holder of the Warrant Shares which the
Holder anticipated receiving upon such exercise (a “Buy-In”), then the
Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the
Holder’s total purchase price (including brokerage commissions, if any) for the
shares of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (1) the number of Warrant Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue times (2) the
price at which the sell order giving rise to such purchase obligation was
executed, and (B) at the option of the Holder, either reinstate the portion of
the Warrant and equivalent number of Warrant Shares for which such exercise was
not honored (in which case such exercise shall be deemed rescinded) or deliver
to the Holder the number of shares of Common Stock that would have been issued
had the Company timely complied with its exercise and delivery obligations
hereunder.  For example, if the Holder purchases Common Stock having a
total purchase price of $11,000 to cover a Buy-In with respect to an attempted
exercise of shares of Common Stock with an aggregate sale price giving rise to
such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The
Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the Company,
evidence of the amount of such loss.  Nothing herein shall limit a
Holder’s right to pursue any other remedies available to it hereunder, at law or
in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Company’s failure to timely deliver
certificates representing shares of Common Stock upon exercise of the Warrant as
required pursuant to the terms hereof.

     

    v.      No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  As to any
fraction of a share which the Holder would otherwise be entitled to purchase
upon such exercise, the Company shall, at its election, either pay a cash
adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole
share.

     

    
      
         

      

      
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    vi.           Charges, Taxes and
Expenses.  Issuance of certificates for Warrant Shares shall be
made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such certificate, all of which
taxes and expenses shall be paid by the Company, and such certificates shall be
issued in the name of the Holder or in such name or names as may be directed by
the Holder; provided, however, that, in the
event certificates for Warrant Shares are to be issued in a name other than the
name of the Holder, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the Holder
and the Company may require, as a condition thereto, the payment of a sum
sufficient to reimburse it for any transfer tax incidental thereto.

     

    vii.          Closing of
Books.  The Company will not close its stockholder books or
records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.

    
      
         

      

      
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    e)           Holder’s Exercise
Limitations.  The Warrant Agent shall not effect any exercise
of this Warrant, and a Holder shall not have the right to exercise any portion
of this Warrant, pursuant to Section 2 or otherwise, to the extent that after
giving effect to such issuance after exercise as set forth on the applicable
Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any
other Persons acting as a group together with the Holder or any of the Holder’s
Affiliates), would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below).  For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned by the Holder
and its Affiliates shall include the number of shares of Common Stock issuable
upon exercise of this Warrant with respect to which such determination is being
made, but shall exclude the number of shares of Common Stock which would be
issuable upon (i) exercise of the remaining, nonexercised portion of this
Warrant beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other
securities of the Company (including, without limitation, any
other  Common Stock Equivalents) subject to a limitation on conversion
or exercise analogous to the limitation contained herein beneficially owned by
the Holder or any of its Affiliates.  Except as set forth in the
preceding sentence, for purposes of this Section 2(e), beneficial ownership
shall be calculated in accordance with Section 13(d) of the Exchange Act and the
rules and regulations promulgated thereunder, it being acknowledged by the
Holder that the Company is not representing to the Holder that such calculation
is in compliance with Section 13(d) of the Exchange Act and the Holder is solely
responsible for any schedules required to be filed in accordance
therewith.   To the extent that the limitation contained in this
Section 2(e) applies, the determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any
Affiliates) and of which portion of this Warrant is exercisable shall be in the
sole discretion of the Holder, and the submission of a Notice of Exercise shall
be deemed to be the Holder’s determination of whether this Warrant is
exercisable (in relation to other securities owned by the Holder together with
any Affiliates) and of which portion of this Warrant is exercisable, in each
case subject to the Beneficial Ownership Limitation, and neither the Warrant
Agent nor the Company shall have any obligation to verify or confirm the
accuracy of such determination.   In addition, a determination as
to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder.  For purposes of this Section 2(e), in determining the
number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the Company’s most recent
periodic or annual report filed with the Commission, as the case may be, (B) a
more recent public announcement by the Company or (C) a more recent written
notice by the Company or the Transfer Agent setting forth the number of shares
of Common Stock outstanding.  Upon the written or oral request of a
Holder, the Company shall within two Trading Days confirm orally and in writing
to the Holder the number of shares of Common Stock then
outstanding.  In any case, the number of outstanding shares of Common
Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder or its
Affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.  The “Beneficial Ownership
Limitation” shall be 4.99%
of the number of shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon exercise of this
Warrant.  The Holder may increase or decrease the Beneficial Ownership
Limitation provisions of this Section 2(e), provided that the Beneficial
Ownership Limitation in no event exceeds 9.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of
shares of Common Stock upon exercise of this Warrant held by the Holder and the
provisions of this Section 2(e) shall continue to apply.  Any such
increase will not be effective until the 61st day
after such notice is delivered to the Company.  The provisions of this
paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 2(e) to correct this paragraph
(or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a successor holder of
this Warrant.

     

    Section
3.             Certain
Adjustments.

     

    a)           Stock Dividends and
Splits. If the Company, at any time while this Warrant is outstanding:
(i) pays a stock dividend or otherwise makes a distribution or distributions on
shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not
include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger
number of shares, (iii) combines (including by way of reverse stock split)
outstanding shares of Common Stock into a smaller number of shares, or (iv)
issues by reclassification of shares of the Common Stock any shares of capital
stock of the Company, then in each case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common
Stock (excluding treasury shares, if any) outstanding immediately before such
event and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event, and the number of shares issuable upon
exercise of this Warrant shall be proportionately adjusted such that the
aggregate Exercise Price of this Warrant shall remain unchanged.  Any
adjustment made pursuant to this Section 3(a) shall become effective immediately
after the record date for the determination of stockholders entitled to receive
such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or
re-classification.

    
      
         

      

      
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    b)           [RESERVED]

     

    c)           Subsequent Rights
Offerings.  If the Company, at any time while the Warrant is
outstanding, shall issue rights, options or warrants to all holders of Common
Stock (and not to the Holders) entitling them to subscribe for or purchase
shares of Common Stock at a price per share less than the VWAP on the record
date mentioned below, then the Exercise Price shall be multiplied by a fraction,
of which the denominator shall be the number of shares of the Common Stock
outstanding on the date of issuance of such rights, options or warrants plus the
number of additional shares of Common Stock offered for subscription or
purchase, and of which the numerator shall be the number of shares of the Common
Stock outstanding on the date of issuance of such rights, options or warrants
plus the number of shares which the aggregate offering price of the total number
of shares so offered (assuming receipt by the Company in full of all
consideration payable upon exercise of such rights, options or warrants) would
purchase at such VWAP.  Such adjustment shall be made whenever such
rights, options or warrants are issued, and shall become effective immediately
after the record date for the determination of stockholders entitled to receive
such rights, options or warrants.

     

    d)           Pro Rata
Distributions.  If the Company, at any time while this Warrant
is outstanding, shall distribute to all holders of Common Stock (and not to the
Holders) evidences of its indebtedness or assets (including cash and cash
dividends) or rights or warrants to subscribe for or purchase any security, then
in each such case the Exercise Price shall be adjusted by multiplying the
Exercise Price in effect immediately prior to the record date fixed for
determination of stockholders entitled to receive such distribution by a
fraction of which the denominator shall be the VWAP determined as of the record
date mentioned above, and of which the numerator shall be such VWAP on such
record date less the then per share fair market value at such record date of the
portion of such assets or evidence of indebtedness so distributed applicable to
one outstanding share of the Common Stock as determined by the Board of
Directors in good faith.  In either case the adjustments shall be
described in a statement provided to the Holder of the portion of assets or
evidences of indebtedness so distributed or such subscription rights applicable
to one share of Common Stock.  Such adjustment shall be made whenever
any such distribution is made and shall become effective immediately after the
record date mentioned above.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    e)           Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the
Company, directly or indirectly, in one or more related transactions effects any
merger or consolidation of the Company with or into another Person, (ii) the
Company, directly or indirectly, effects any sale, lease, license, assignment,
transfer, conveyance or other disposition of all or substantially all of its
assets in one or a series of related transactions, (iii) any, direct or
indirect, purchase offer, tender offer or exchange offer (whether by the Company
or another Person) is completed pursuant to which holders of Common Stock are
permitted to sell, tender or exchange their shares for other securities, cash or
property and has been accepted by the holders of 50% or more of the outstanding
Common Stock, (iv) the Company, directly or indirectly, in one or more related
transactions effects any reclassification, reorganization or recapitalization of
the Common Stock or any compulsory share exchange pursuant to which the Common
Stock is effectively converted into or exchanged for other securities, cash or
property, (v) the Company, directly or indirectly, in one or more related
transactions consummates a stock or share purchase agreement or other business
combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with another Person whereby such other Person
acquires more than 50% of the outstanding shares of Common Stock (not including
any shares of Common Stock held by the other Person or other Persons making or
party to, or associated or affiliated with the other Persons making or party to,
such stock or share purchase agreement or other business combination) (each a
“Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the
Holder shall have the right to receive, for each Warrant Share that would have
been issuable upon such exercise immediately prior to the occurrence of such
Fundamental Transaction, at the option of the Holder (without regard to any
limitation in Section 2(e) on the exercise of this Warrant), the number of
shares of Common Stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and any additional consideration
(the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by
a holder of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such Fundamental Transaction (without regard to
any limitation in Section 2(e) on the exercise of this Warrant).  For
purposes of any such exercise, the determination of the Exercise Price shall be
appropriately adjusted to apply to such Alternate Consideration based on the
amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the
Exercise Price among the Alternate Consideration in a reasonable manner
reflecting the relative value of any different components of the Alternate
Consideration.  If holders of Common Stock are given any choice as to
the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration
it receives upon any exercise of this Warrant following such Fundamental
Transaction.  Notwithstanding anything to the contrary, in the event
of a Fundamental Transaction other
than one in which a Successor Entity (as defined below) that is a publicly
traded corporation whose stock is quoted or listed for trading on a Trading
Market assumes this Warrant such that the Warrant shall be exercisable for the
publicly traded Common Stock of such Successor Entity, the Company or any
Successor Entity shall, at the Holder’s option, exercisable at any time
concurrently with, or within 30 days after, the consummation of the Fundamental
Transaction, purchase this Warrant
from the Holder by paying to the Holder an amount of cash equal to the
Black Scholes Value of the remaining unexercised portion of this Warrant on the
date of the consummation of such Fundamental Transaction.  “Black Scholes Value”
means the value of this Warrant based on the Black and Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”)
determined as of the day of consummation of the applicable Fundamental
Transaction for pricing purposes and reflecting (A) a risk-free interest rate
corresponding to the U.S. Treasury rate for a period equal to the time between
the date of the public announcement of the applicable Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the greater of
100% and the 100 day volatility obtained from the HVT function on Bloomberg as
of the Trading Day immediately following the public announcement of the
applicable Fundamental Transaction, (C) the underlying price per share used in
such calculation shall be the sum of the price per share being offered in cash,
if any, plus the value of any non-cash consideration, if any, being offered in
such Fundamental Transaction and (D) a remaining option time equal to the time
between the date of the public announcement of the applicable Fundamental
Transaction and the Termination Date.  The Company shall cause any
successor entity in a Fundamental Transaction in which the Company is not the
survivor (the “Successor Entity”) to
assume in writing all of the obligations of the Company under this Warrant and
the other Transaction Documents in accordance with the provisions of this
Section 3(e) pursuant to written agreements in form and substance reasonably
satisfactory to the Holder and approved by the Holder (without unreasonable
delay) prior to such Fundamental Transaction and shall, at the option of the
holder of this Warrant, deliver to the Holder in exchange for this Warrant a
security of the Successor Entity evidenced by a written instrument substantially
similar in form and substance to this Warrant which is exercisable for a
corresponding number of shares of capital stock of such Successor Entity (or its
parent entity) equivalent to the shares of Common Stock acquirable and
receivable upon exercise of this Warrant (without regard to any limitations on
the exercise of this Warrant) prior to such Fundamental Transaction, and with an
exercise price which applies the exercise price hereunder to such shares of
capital stock (but taking into account the relative value of the shares of
Common Stock pursuant to such Fundamental Transaction and the value of such
shares of capital stock, such number of shares of capital stock and such
exercise price being for the purpose of protecting the economic value of this
Warrant immediately prior to the consummation of such Fundamental Transaction),
and which is reasonably satisfactory in form and substance to the Holder. Upon
the occurrence of any such Fundamental Transaction, the Successor Entity shall
succeed to, and be substituted for (so that from and after the date of such
Fundamental Transaction, the provisions of this Warrant and the other
Transaction Documents referring to the “Company” shall refer instead to the
Successor Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Warrant and the
other Transaction Documents with the same effect as if such Successor Entity had
been named as the Company herein.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    f)           Calculations. All
calculations under this Section 3 shall be made to the nearest cent or the
nearest 1/100th of a share, as the case may be. For purposes of this Section 3,
the number of shares of Common Stock deemed to be issued and outstanding as of a
given date shall be the sum of the number of shares of Common Stock (excluding
treasury shares, if any) issued and outstanding.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    g)           Notice to
Holder.

     

    i.      Adjustment to Exercise
Price. Whenever the Exercise Price is adjusted pursuant to any provision
of this Section 3, the Company shall promptly mail to the Holder a notice
setting forth the Exercise Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment.

     

    ii.     Notice to Allow Exercise by
Holder. If (A) the Company shall declare a dividend (or any other
distribution in whatever form) on the Common Stock, (B) the Company shall
declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common
Stock rights or warrants to subscribe for or purchase any shares of capital
stock of any class or of any rights, (D) the approval of any stockholders of the
Company shall be required in connection with any reclassification of the Common
Stock, any consolidation or merger to which the Company is a party, any sale or
transfer of all or substantially all of the assets of the Company, or any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or property, or (E) the Company shall authorize the voluntary
or involuntary dissolution, liquidation or winding up of the affairs of the
Company, then, in each case, the Company shall cause to be mailed to the Holder
at its last address as it shall appear upon the Warrant Register of the Company,
at least 20 calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be
taken for the purpose of such dividend, distribution, redemption, rights or
warrants, or if a record is not to be taken, the date as of which the holders of
the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer or share exchange
is expected to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be entitled to
exchange their shares of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer or
share exchange; provided that the failure to mail such notice or any defect
therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice.  To the extent that
any notice provided hereunder constitutes, or contains, material, non-public
information regarding the Company or any of the Subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K.  The Holder shall remain entitled to exercise this
Warrant during the period commencing on the date of such notice to the effective
date of the event triggering such notice except as may otherwise be expressly
set forth herein.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    Section
4.             Transfer of
Warrant.

     

    a)           Transferability.  This
Warrant and all rights hereunder (including, without limitation, any
registration rights) are transferable, in whole or in part, upon surrender of
this Warrant at the principal office of the Transfer Agent, together with a
written assignment of this Warrant substantially in the form attached hereto
duly executed by the Holder or its agent or attorney and funds sufficient to pay
any transfer taxes payable upon the making of such transfer.  Upon
such surrender and, if required, such payment, the Warrant Agent shall execute
and deliver a new Warrant or Warrants in the name of the assignee or assignees,
as applicable, and in the denomination or denominations specified in such
instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall
promptly be cancelled.  The Warrant, if properly assigned in
accordance herewith, may be exercised by a new holder for the purchase of
Warrant Shares without having a new Warrant issued.

     

    b)           New Warrants. This
Warrant may be divided or combined with other Warrants upon presentation hereof
at the aforesaid office of the Warrant Agent, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney.  Subject to compliance
with Section 4(a), as to any transfer which may be involved in such division or
combination, the Warrant Agent shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice. All Warrants issued on transfers or exchanges shall
be dated the initial issuance date set forth on the first page of this Warrant
and shall be identical with this Warrant except as to the number of Warrant
Shares issuable pursuant thereto.

     

    c)           Warrant Register. The
Warrant Agent shall register this Warrant, upon records to be maintained by the
Warrant Agent for that purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time.  The
Company and Warrant Agent may deem and treat the registered Holder of this
Warrant as the absolute owner hereof for the purpose of any exercise hereof or
any distribution to the Holder, and for all other purposes, absent actual notice
to the contrary.

     

    d)           Warrant Execution and
Countersignature.  The Warrant Agent is hereby authorized to
countersign and to deliver, in accordance with the terms of this Warrant, the
Warrants required to be issued pursuant to this Warrant, and the Company,
whenever required by the Warrant Agent, shall supply the Warrant Agent with
Warrants duly executed on behalf of the Company for such purpose.

     

    e)           Understandings or
Arrangements.    Such Holder is acquiring this
Warrant as principal for its own account and has no direct or indirect
arrangement or understandings with any other persons to distribute or regarding
the distribution of such Warrant (this representation and warranty not limiting
such Holder’s right to sell the Warrant pursuant to the Registration Statement
or otherwise in compliance with applicable federal and state securities laws.)
Such Holder is acquiring this Warrant hereunder in the ordinary course of its
business.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

     

    Section
5.               Warrant
Agent.

     

    a)           Appointment of Warrant
Agent.  The Company hereby appoints Continental Stock Transfer
& Trust Company, a New York corporation (the “Warrant Agent”), to
act as agent for the Company for this Warrant, and the Warrant Agent hereby
accepts such appointment and agrees to perform the same in accordance with the
terms and conditions set forth in this Warrant.

     

    b)           Appointment of Successor
Warrant Agent.  The Warrant Agent, or any successor to it
hereafter appointed, may resign its duties and be discharged from all further
duties and liabilities hereunder after giving sixty (60) days’ notice in writing
to the Company.  If the office of the Warrant Agent becomes vacant by
resignation or incapacity to act or otherwise, the Company shall appoint in
writing a successor Warrant Agent in place of the Warrant
Agent.  During any period in which the office of the Warrant Agent is
vacant until a successor Warrant Agent shall have been appointed and notice
thereof given to the Warrant holder, the Company shall be the Warrant Agent and
shall fulfill all of the obligations of the Warrant Agent set forth
herein.  If the Company shall fail to make such appointment within a
period of thirty (30) days after it has been notified in writing of such
resignation or incapacity by the Warrant Agent or by the Holder (who or which
shall, with such notice, submit this Warrant for inspection by the Company),
then the Holder may apply to the Supreme Court of the State of New York for the
County of New York for the appointment of a successor Warrant Agent at the
Company’s cost.  Any successor Warrant Agent, whether appointed by the
Company or by such court, shall be a corporation authorized to exercise banking
or corporate trust powers and shall be subject to supervision or examination by
federal or state authority.  After appointment, any successor Warrant
Agent shall be vested with all the authority, powers, rights, immunities,
duties, and obligations of its predecessor Warrant Agent with like effect as if
originally named as Warrant Agent hereunder, without any further act or deed;
provided that, if for any reason it becomes necessary or appropriate, the
predecessor Warrant Agent shall execute and deliver, at the expense of the
Company, an instrument transferring to such successor Warrant Agent all the
authority, powers and rights of such predecessor Warrant Agent hereunder; and
upon request of any successor Warrant Agent the Company shall make, execute,
acknowledge and deliver any and all instruments in writing for more fully and
effectually vesting in and confirming to such successor Warrant Agent all such
authority, powers, rights, immunities, duties and obligations.

     

    c)           Notice of Successor Warrant
Agent.  In the event a successor Warrant Agent shall be
appointed, the Company shall give notice thereof to the predecessor Warrant
Agent and the transfer agent for the Common Stock and the Holder not later than
the effective date of any such appointment.

     

    d)           Merger or Consolidation of
Warrant Agent.  Any corporation into which the Warrant Agent
may be merged or with which it may be consolidated or any corporation resulting
from any merger or consolidation to which the Warrant Agent shall be a party
shall be the successor Warrant Agent under this Warrant without any further
act.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    e)           Remuneration.  The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder and will reimburse the Warrant Agent upon demand
for all expenditures that the Warrant Agent may reasonably incur in the
execution of its duties hereunder.

     

    f)           Further
Assurances.  The Company agrees to perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may be
required by the Warrant Agent for the carrying out or performing of the
provisions of this Warrant.

     

    g)           Reliance on Company
Statement.  Whenever in the performance of its duties under
this Warrant, the Warrant Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a statement signed by the Chairman of the
Board, the Chief Executive Officer or the Chief Financial Officer of the Company
and delivered to the Warrant Agent.  The Warrant Agent may rely upon
such statement for any action taken or suffered in good faith by it pursuant to
the provisions of this Warrant.

     

    h)           Indemnity.  The
Warrant Agent shall be liable hereunder only for its own gross negligence,
willful misconduct or bad faith.  The Company shall indemnify the
Warrant Agent and save it harmless against any and all liabilities, including
judgments, costs and reasonable counsel fees, for anything done or omitted by
the Warrant Agent in the execution of this Warrant except as a result of the
Warrant Agent’s, the Warrant Agent’s representative’s, employees’ or agent’s
gross negligence, willful misconduct or bad faith.

     

    i)           Exclusions.  The
Warrant Agent shall have no responsibility with respect to the validity of this
Warrant (except its countersignature hereof); nor shall it be responsible for
any breach by the Company of any covenant or condition contained in this
Warrant; nor shall it be responsible to make any adjustments required under the
provisions of this Warrant or responsible for the manner, method or amount of
any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any
shares of Common Stock to be issued pursuant to this Warrant or as to whether
any shares of Common Stock will when issued be valid and fully paid and
nonassessable.

     

    j)           Acceptance of
Agency.  The Warrant Agent hereby accepts the agency
established by this Warrant and agrees to perform the same upon the terms and
conditions herein set forth and among other things, shall account promptly to
the Company with respect to any exercise of this Warrant and concurrently
account for, and pay to the Company, all moneys received by the Warrant Agent
for the purchase of shares of Common Stock through the exercise of this
Warrant.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

     

    Section
6.             Miscellaneous.

     

    a)           No Rights as Stockholder
Until Exercise.  This Warrant does not entitle the Holder to
any voting rights, dividends or other rights as a stockholder of the Company
prior to the exercise hereof as set forth in Section 2(d)(i).

     

    b)           Loss, Theft, Destruction or
Mutilation of Warrant. The Company covenants that upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant or any stock certificate relating to
the Warrant Shares, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it (which, in the case of the Warrant, shall
not include the posting of any bond), and upon surrender and cancellation of
such Warrant or stock certificate, if mutilated, the Company will make and
deliver a new Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.

     

    c)           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not
be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.

     

    d)          Authorized
Shares.

     

    The
Company covenants that, during the period the Warrant is outstanding, it will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of the Warrant Shares upon the exercise of
any purchase rights under this Warrant.  The Company further covenants
that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for the Warrant Shares upon the
exercise of the purchase rights under this Warrant.  The Company will
take all such reasonable action as may be necessary to assure that such Warrant
Shares may be issued as provided herein without violation of any applicable law
or regulation, or of any requirements of the Trading Market upon which the
Common Stock may be listed or quoted.  The Company covenants that all
Warrant Shares which may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon exercise of the purchase rights
represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and nonassessable and
free from all taxes, liens and charges created by the Company in respect of the
issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    Except
and to the extent as waived or consented to by the Holder, the Company shall not
by any action, including, without limitation, amending its articles of
incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this Warrant against
impairment.  Without limiting the generality of the foregoing, the
Company will (i) not increase the par value of any Warrant Shares above the
amount payable therefor upon such exercise immediately prior to such increase in
par value, (ii) take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable
Warrant Shares upon the exercise of this Warrant and (iii) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof, as may be necessary
to enable the Company to perform its obligations under this
Warrant.

     

    Before
taking any action which would result in an adjustment in the number of Warrant
Shares for which this Warrant is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.

     

    e)           Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation
of this Warrant shall be determined in accordance with the provisions of the
Purchase Agreement.

     

    f)           Restrictions.  The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this
Warrant, if not registered, and the Holder does not utilize cashless exercise,
will have restrictions upon resale imposed by state and federal securities
laws.

     

    g)           Nonwaiver and
Expenses.  No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice Holder’s rights, powers or
remedies.  Without limiting any other provision of this Warrant or the
Purchase Agreement, if the Company willfully and knowingly fails to comply with
any provision of this Warrant, which results in any material damages to the
Holder, the Company shall pay to Holder such amounts as shall be sufficient to
cover any costs and expenses including, but not limited to, reasonable
attorneys’ fees, including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing any of its
rights, powers or remedies hereunder.

     

    h)           Notices.  Any
notice, request or other document required or permitted to be given or delivered
to the Holder by the Company shall be delivered in accordance with the notice
provisions of the Purchase Agreement.

     

    Any notice, statement or
demand authorized by this Warrant to be given or made by the Holder or by the
Company to or on the Warrant Agent shall be sufficiently given when so delivered
if by hand or overnight delivery or if sent by certified mail or private courier
service within five days after deposit of such notice, postage prepaid,
addressed (until another address is filed in writing by the Warrant Agent with
the Company), as follows:

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

     

    Continental Stock Transfer
& Trust Company

    17 Battery
Place

    New York, NY
10004

    Facsimile: (212)
616-7616

    Attn: Michael
Mullings

     

    i)           Limitation of
Liability.  No provision hereof, in the absence of any
affirmative action by Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of Holder, shall
give rise to any liability of Holder for the purchase price of any Common Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.

     

    j)           Remedies.  The
Holder, in addition to being entitled to exercise all rights granted by law,
including recovery of damages, will be entitled to specific performance of its
rights under this Warrant.  The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law
would be adequate.

     

    k)           Successors and
Assigns.  Subject to applicable securities laws, this Warrant
and the rights and obligations evidenced hereby shall inure to the benefit of
and be binding upon the successors and permitted assigns of the parties
hereto.  The provisions of this Warrant are intended to be for the
benefit of any Holder from time to time of this Warrant and shall be enforceable
by the Holder or holder of Warrant Shares.

     

    l)           Amendment.  This
Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.

     

    m)           Severability.  Wherever
possible, each provision of this Warrant shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Warrant shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Warrant.

     

    n)           Headings.  The
headings used in this Warrant are for the convenience of reference only and
shall not, for any purpose, be deemed a part of this Warrant.

    

    ********************

    

    (Signature
Pages Follow)

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized as of the date first above
indicated.

    

    
      	 
      	 
      	
              FAR
      EAST ENERGY CORPORATION

            
	 
      	 
      	 
      
	 
      	 
      	
              By:

            	
              __________________________________________

            
	 
      	 
      	 
      	
              Name:

            	
              Andrew
      Lai

            
	 
      	 
      	 
      	
              Title:

            	
              Chief
      Financial Officer

            
	 
      	 
      	 
      
	 
      	 
      	
              CONTINENTAL
      STOCK TRANSFER & TRUST

            
	 
      	 
      	
              COMPANY,
      as Warrant Agent

            
	 
      	 
      	 
      
	 
      	 
      	
              By:

            	
              __________________________________________

            
	 
      	 
      	 
      	
              Name:

            	
              Michael
      G. Mullings

            
	 
      	 
      	 
      	
              Title:

            	
              Vice
      President, Compliance

            

    

     

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    

    NOTICE
OF EXERCISE

    

    TO:           _______________________

    

    (1)  The
undersigned hereby elects to purchase ________ Warrant Shares of the Company
pursuant to the terms of the attached Warrant (only if exercised in full), and
tenders herewith payment of the exercise price in full, together with all
applicable transfer taxes, if any.

     

    (2)  Payment
shall take the form of (check applicable box):

     

    [  ]
in lawful money of the United States; or

     

    [ ] [if
permitted] the cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in subsection 2(c), to exercise this
Warrant with respect to the maximum number of Warrant Shares purchasable
pursuant to the cashless exercise procedure set forth in subsection
2(c).

     

    (3)  Please
issue a certificate or certificates representing said Warrant Shares in the name
of the undersigned or in such other name as is specified below:

     

    _______________________________

    

    

    The
Warrant Shares shall be delivered to the following DWAC Account Number or by
physical delivery of a certificate to:

    

    _______________________________

    

    _______________________________

    

    _______________________________

    

    

    [SIGNATURE
OF HOLDER]

    

    Name of
Investing Entity:
______________________________________________________________________________

    Signature of Authorized Signatory of
Investing Entity:
________________________________________________________

    Name of
Authorized Signatory:
__________________________________________________________________________

    Title of
Authorized Signatory:
___________________________________________________________________________

    Date:
______________________________________________________________________________________________

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    ASSIGNMENT
FORM

    

    (To
assign the foregoing warrant, execute

    this form
and supply required information.

    Do not
use this form to exercise the warrant.)

    

    FOR VALUE
RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all
rights evidenced thereby are hereby assigned to

     

    _______________________________________________
whose address is

    

    _______________________________________________________________.

     

    _______________________________________________________________

    

    Dated:  ______________,
_______

    

    Holder’s
Signature:              _____________________________

    

    Holder’s
Address:                _____________________________

    

     _____________________________

    

    Signature
Guaranteed:  ___________________________________________

    

    NOTE:  The
signature to this Assignment Form must correspond with the name as it appears on
the face of the Warrant, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust
company.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.

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