Common use of Contingent Purchase Right Clause in Contracts

Contingent Purchase Right. Subject to the qualifications and limitations set forth in this Section 3.1, if, during the period from the Closing Date until the Termination Date (as defined in Section 3.1(c)) (such period, the “Contingent Right Term”), the Company grants, issues or sells any shares of Common Stock, or any securities convertible into, or exercisable or exchangeable for, shares of Common Stock, or any rights to purchase Common Stock or any other securities (collectively, the “Derivative Securities”) in any transaction or series of related transactions, then the Investor shall have the right (but not the obligation) to purchase additional shares of Common Stock (the “Contingent Purchase Right”) in an amount equal to the product of (x) the Yield Percentage and (y) the aggregate amount of (i) shares of Common Stock and (ii) shares of Common Stock into which such Derivative Securities are convertible, exercisable or exchangeable, that were granted, issued or sold, at a price per share equal to the then par value per share of the Common Stock. In addition, “Derivative Securities” shall include, and the “Contingent Purchase Right” shall apply to, any securities convertible into, or exercisable or exchangeable for, shares of Common Stock, or any rights to purchase Common Stock or any other securities, that were issued prior to the Closing Date (i) if and to the extent such Derivative Securities are converted, exercised or exchanged during the Contingent Right Term, and (ii) so long as such Derivative Securities were issued for the primary purpose of raising capital (any such Derivative Securities, the “Previously Issued Derivative Securities”). Notwithstanding the foregoing, in the event the Company issues Derivative Securities (or issued Previously Issued Derivative Securities) that do not (did not) initially convey voting power (as determined by reference to the NASDAQ Stock Market Rules) to the holder, the Contingent Purchase Right shall only apply if and when such Derivative Securities (or Previously Issued Derivative Securities) are actually converted, exercised or exchanged for Common Stock, or voting power is otherwise ascribed to such Derivative Securities (or Previously Issued Derivative Securities), and, in any such event, the Contingent Purchase Right shall only apply with respect to the net number of shares of Common Stock actually issued, or the net number of Derivative Securities to which voting power has actually been ascribed, as applicable. For purposes of the remainder of this Section 3.1, references to Derivative Securities shall be deemed to include Previously Issued Derivative Securities, as applicable.