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configurations ("RWCs") and for the purchase by CV from
Sun of RWCs. In recognition of their mutual
expectation of a continuing business relationship of
value to both parties, CV has indicated its willingness
to make certain loans to Sun and Sun has indicated its
willingness to grant to CV an equity participation in
Sun.
* * * * * * *
3. The Warrants. As additional incentive for an
ongoing business relationship, Sun is issuing to CV (a)
a warrant to purchase 10,000 shares of Sun’s Series F
Preferred Stock at a price of $120.00 per share, such
warrant to become exercisable on the day after the
Cumulative Sun Business with CV (referred to below)
exceeds $20 million if such figure is reached within 36
months of the date of the first shipment by CV of a
First Generation RWC (as defined in the Joint
Development Agreement) for revenue and (b) a warrant to
purchase 10,000 shares of Sun’s Series G Preferred
Stock at a price of $150.00 per share, such warrant to
become exercisable on the day after the Cumulative Sun
Business with CV exceeds $30 million if such figure is
reached within the 36 month period mentioned in (a)
above. * * * Definitions of "Cumulative Sun Business
with CV" and of the first shipment by CV of a unit for
revenue appear below.
4. Cumulative Sun Business with CV. The Cumulative
Sun Business with CV, which determines the
exercisability of the Warrants as provided above, shall
be the aggregate cumulative sum of (i) the amount of
Sun’s invoices (net of freight, insurance, duty, taxes
and returned products) to CV for Sun products purchased
by CV under the Purchase Agreement (as defined below),
and (ii) royalties payable by CV to Sun pursuant to
Section 5 of the Joint Development Agreement.
* * * * * * *
(b) The shipment by CV of a First Generation RWC for
revenue refers to the first bona fide regular way
placement of such a unit by CV with an independent
customer, whether such unit be placed on sale or lease
terms. The use by CV of units internally, including
units used by its subsidiaries, shall not be regarded
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