Common use of Special Restrictions Clause in Contracts

Special Restrictions. (a) Except as otherwise provided in Section 7.2(b), this Section 8.3 and Article 9, (i) from the Closing Date until six (6) months after the Merger Termination Date (such period being referred to as the “Primary Lock-up Period”), Purchaser shall not, (A) sell, offer to sell, solicit offers to buy, dispose of, loan, pledge or grant any right with respect to (collectively, a “Disposition”) the Common Shares; or (B) engage in any hedging, Short Sale or other transaction which is designed or could reasonably be expected to lead to or result in a Disposition of any of the Common Shares by Purchaser (“Short Sales”), which shall include, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act and all types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps and similar arrangements (including on a total return basis), and sales and other transactions through non-U.S. broker-dealers or foreign regulated brokers and (ii) from the expiration of the Primary Lock-up Period until fifteen (15) months after the Merger Termination Date (the “Secondary Lock-up Period”), Purchaser shall not effect Dispositions or Short Sales of the Common Shares in excess of one third of the aggregate number of Common Shares purchased by Purchaser hereunder in each of the three (3)-month periods in the Secondary Lock-up Period. Notwithstanding any of the foregoing to the contrary, Purchaser may effect one block sale of all or a portion of the Common Shares in a single trade at anytime during the period beginning from the Registration Effective Date and ending on the later of (x) three (3) months after the Merger Termination Date, (y) ten (10) days after the Registration Effective Date and (z) seven (7) months after the Closing Date (such period being referred to as the “Block Trade Window Period”); provided that, in the case where clause (z) is applicable for determining the Block Trade Window Period, the Primary Lock-up Period shall expire seven (7) months after the Merger Termination Date and the Secondary Lock-up Period shall expire sixteen (16) months after the Merger Termination Date. The restrictions set forth in this Section 8.3 shall terminate, if not earlier terminated in accordance with its terms, on the first date on which the Common Shares then held by Purchaser constitute less than 2.5% of the outstanding Common Stock of the Company. (b) Each certificate representing Common Shares shall bear the following legend until Purchaser’s obligation under this Section 8.3 has expired: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RESTRAINT ON ALIENATION PROHIBITING THE SALE OR OTHER TRANSFER OF THE SHARES REPRESENTED HEREBY FOR A SPECIFIED PERIOD OF TIME UNDER THE TERMS AND CONDITIONS OF AN AGREEMENT BETWEEN THE HOLDER HEREOF AND SOLEXA, INC. A COPY OF SUCH AGREEMENT WILL BE FURNISHED WITHOUT CHARGE UPON WRITTEN REQUEST TO SOLEXA, INC. AT ITS PRINCIPAL PLACE OF BUSINESS.”

Special Restrictions. It is hereby acknowledged and agreed by CSSE that under the terms of the JV Operating Agreement, the Crackle JV Interest may be exchanged, at certain prescribed times, into shares of the Preferred Stock. CSSE agrees that so long as Crackle owns the full amount of the Crackle JV Interest or 25% or more of the shares of Preferred Stock issued upon exchange of the Crackle JV Interest under the terms of the JV Operating Agreement, CSSE shall (a) Except as otherwise provided in Section 7.2(b), this Section 8.3 and Article 9, maintain a ratio (on a twelve-month rolling basis) of (i) from the Closing Date until six (6) months after the Merger Termination Date (such period being referred to as the “Primary Lock-up Period”), Purchaser shall not, sum of (A) sellall interest expense, offer to sell, solicit offers to buy, dispose of, loan, pledge or grant any right with respect to (collectively, a “Disposition”) the Common Shares; or and (B) engage in any hedging, Short Sale all regularly scheduled payments or other transaction which is designed prepayments of principal of indebtedness paid (or could reasonably that were required to be expected to lead to or result in a Disposition of any of paid during the Common Shares by Purchaser (“Short Sales”applicable period), which shall includeof CSSE and its consolidated subsidiaries, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act and all types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps and similar arrangements (including on a total return basis), and sales and other transactions through non-U.S. broker-dealers or foreign regulated brokers and to (ii) from Adjusted EBITDA, as such term is defined in CSSE’s SEC filings or, a comparable financial metric reasonably acceptable to Crackle in the expiration event CSSE has not published Adjusted EBITDA in its SEC filings for the applicable period, for such period, of no greater than 4.00 to 1.00 (such debt leverage calculation to exclude working capital lines and similar debt leverage), (b) not create any preferred stock that is senior to the Preferred Stock in terms of rights, preferences or privileges, including without limitation payments, distributions, or rights on liquidation, and (c) not issue any additional shares of Preferred Stock at a per-share price below $25.00. In the event Crackle has converted its Crackle JV Interest into Preferred Stock, Crackle shall have the right to purchase additional shares of Preferred Stock in any offering of the Primary Lock-up Period until Preferred Stock made by CSSE for cash (but not in connection with the issuance of Preferred Stock by CSSE in connection with acquisitions or the engagement of strategic relationships). In connection with any such proposed offering of the Preferred Stock by CSSE for cash, it shall provide Crackle with written notice of same at least fifteen (15) months after Business Days (or, if such offering is pursuant to an effective shelf Registration Statement, at least two (2) Business Days) prior to the Merger Termination Date (closing of same and Crackle shall have the “Secondary Lock-up Period”), Purchaser shall not effect Dispositions or Short Sales right to purchase that number of shares of Preferred Stock required to maintain its then relative percentage ownership of the Common Shares in excess of one third outstanding Preferred Stock, after giving effect of the aggregate number of Common Shares purchased by Purchaser hereunder in each closing of the three (3)-month periods proposed offering. Any such purchase by Crackle shall be on the same terms as offered to the investors in the Secondary Lock-up Periodproposed offering. Notwithstanding any Crackle shall provide written notice of the foregoing its election to the contrary, Purchaser may effect one block sale of all or a portion of the Common Shares in a single trade at anytime during the period beginning from the Registration Effective Date and ending on the later of (x) three (3) months after the Merger Termination Date, (y) exercise its rights hereunder within ten (10) days after Business Days of its receipt of the Registration Effective Date aforementioned noticed from CSSE. Notwithstanding the foregoing, CSSE shall not be bound by the foregoing restrictions and (z) seven (7) months after shall not be obligated to afford Crackle the Closing Date (such period being referred to as the “Block Trade Window Period”); provided that, in the case where clause (z) is applicable for determining the Block Trade Window Period, the Primary Lock-up Period shall expire seven (7) months after the Merger Termination Date and the Secondary Lock-up Period shall expire sixteen (16) months after the Merger Termination Date. The restrictions set forth in this Section 8.3 shall terminateforegoing rights, if not earlier terminated CSSE makes a bona fide offer in accordance with its terms, on writing to Crackle to purchase all of the first date on Preferred Stock into which the Common Shares then held by Purchaser constitute less than 2.5% of the outstanding Common Stock of the CompanyCrackle JV Interest is converted at par value ($25 per share) plus all accrued but unpaid dividends thereon. (b) Each certificate representing Common Shares shall bear the following legend until Purchaser’s obligation under this Section 8.3 has expired: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RESTRAINT ON ALIENATION PROHIBITING THE SALE OR OTHER TRANSFER OF THE SHARES REPRESENTED HEREBY FOR A SPECIFIED PERIOD OF TIME UNDER THE TERMS AND CONDITIONS OF AN AGREEMENT BETWEEN THE HOLDER HEREOF AND SOLEXA, INC. A COPY OF SUCH AGREEMENT WILL BE FURNISHED WITHOUT CHARGE UPON WRITTEN REQUEST TO SOLEXA, INC. AT ITS PRINCIPAL PLACE OF BUSINESS.”