Common use of Conversion upon Qualified Financing Clause in Contracts

Conversion upon Qualified Financing. Effective upon a Qualified Financing, all of the outstanding principal and accrued interest under this Note (the “Outstanding Amount”) will, either automatically in the case of a Qualified Financing that is not a Qualified Private Financing, or upon the written election of the Holder provided to the Maker no later than five business days following delivery of the Financing Notice (the “Conversion Election”) in the case of a Qualified Private Financing, be converted into shares of the same class and series of capital stock of the Maker issued to other investors on the same basis as the investment by such investors in the Qualified Financing, including all contractual rights, if any, provided to all other investors in the Qualified Financing (the “Qualified Financing Securities”) and at a conversion price equal to the lowest price per share of Qualified Financing Securities paid by any other investor in the Qualified Financing (the “Qualified Financing Price”), with any resulting fraction of a share rounded down to the nearest whole share. Notwithstanding the foregoing, if the conversion of this Note pursuant to this Section 2 would otherwise result in the Holder, together with its affiliates, owning more than 5% of the outstanding capital stock of the Maker, calculated on an as-converted fully-diluted basis (but not including as outstanding shares of capital stock issuable upon exercise or conversion of all outstanding stock options, warrants or other convertible securities of the Maker), immediately following the conversion of the Note (the “5% Threshold”), the Outstanding Amount shall be converted either pursuant to the first sentence of this Section 2 or, at the Holder’s option, into (i) that number of shares of Qualified Financing Securities that would result in the Maker reaching, but not exceeding, the 5% Threshold (the “5% Shares”), and (ii) an amount in cash equal to the difference between (A) the product of (1) the number of 5% Shares issued upon conversion, multiplied by (2) the Qualified Financing Price and (B) the Outstanding Amount. The Maker shall notify the Holder in writing of the anticipated occurrence of a Qualified Financing at least 10 days prior to the closing date of the Qualified Financing.

Conversion upon Qualified Financing. Effective upon If prior to the occurrence of a Payoff Event, an IPO, a Change in Control or a Reverse Merger Transaction, the Company completes a Qualified Financing, all of the outstanding principal and accrued interest under then this Note (the “Outstanding Amount”) will, either shall automatically in the case convert into that number of a Qualified Financing that is not a Qualified Private Financing, or upon the written election of the Holder provided to the Maker no later than five business days following delivery of the Financing Notice (the “Conversion Election”) in the case of a Qualified Private Financing, be converted into fully paid and non-assessable shares of the same class Company that is equal to One Hundred and series of capital stock Seventy-Five Percent (175%) times the Note Value divided by the per share price at which such shares of the Maker Company are issued to other investors on purchasers of the same basis as the investment by such investors Company’s equity securities in the Qualified Financing, including all contractual rights, if any, provided to all other investors in the Qualified Financing (the “Qualified Financing Securities”) and at a conversion price equal to the lowest price per share of Qualified Financing Securities paid by any other investor in the Qualified Financing (the “Qualified Financing Price”), with any resulting fraction of a share rounded down to the nearest whole share. The Holder shall be entitled to the same contractual rights and be bound by the same restrictions and obligations as the other purchasers of shares in the Qualified Financing. By acceptance of this Note, the Holder agrees to execute and deliver all documents and agreements necessary to evidence the grant of such rights to the Holder, and the imposition of such restrictions and obligations upon the Holder, as are executed by the purchasers of the shares in the Qualified Financing on or before the initial issuance thereof. “Qualified Financing” means, following the closing by the Company (or its successor) of the sale and issuance of Prior Notes and the Notes, the subsequent closing by the Company (or its successor) of the sale and issuance of capital stock of the Company (or its successor) in a single transaction or series of related transactions resulting in gross proceeds to the Company of not less than $5,000,000 (including new equity investment of at least $1,000,000 plus the sum of the outstanding principal amount of the Notes be so converted pursuant to this Section 2(c)). Notwithstanding the foregoing, if the conversion of this Note pursuant to this Section 2 would otherwise result in the Holder, together with its affiliates, owning more than 5% of event the outstanding capital stock of the Maker, calculated on an as-converted fully-diluted basis (but not including as outstanding shares of capital stock issuable upon exercise or conversion of all outstanding stock options, warrants or other convertible securities of the Maker), immediately following the conversion of the Note (the “5% Threshold”), the Outstanding Amount shall be converted either pursuant to the first sentence of this Section 2 or, at the Holder’s option, into (i) that number of shares of Qualified Financing Securities that would result in the Maker reaching, but not exceeding, the 5% Threshold (the “5% Shares”), and (ii) an amount in cash equal to the difference between (A) the product of (1) the number of 5% Shares issued upon conversion, multiplied by (2) the Qualified Financing Price and (B) the Outstanding Amount. The Maker shall notify the Holder in writing of the anticipated occurrence of Company closes a Qualified Financing at least 10 days immediately prior to a Reverse Merger Transaction, this Note shall not convert upon the closing date of such Qualified Financing and shall in lieu of conversion under this Section 2(c) convert upon the Qualified Financingclosing by the Company of such Reverse Merger Transaction in accordance with the applicable terms and conditions of Section 2(d) below.

Conversion upon Qualified Financing. Effective upon If prior to the occurrence of a Payoff Event, an IPO, a Change in Control or a Reverse Merger Transaction, the Company completes a Qualified Financing, all of the outstanding principal and accrued interest under then this Note (the “Outstanding Amount”) will, either shall automatically in the case convert into that number of a Qualified Financing that is not a Qualified Private Financing, or upon the written election of the Holder provided to the Maker no later than five business days following delivery of the Financing Notice (the “Conversion Election”) in the case of a Qualified Private Financing, be converted into fully paid and non-assessable shares of the same class Company that is equal to One Hundred and series of capital stock Seventy-Five Percent (175%) times the Note Value divided by the per share price at which such shares of the Maker Company are issued to other investors on purchasers of the same basis as the investment by such investors Company's equity securities in the Qualified Financing, including all contractual rights, if any, provided to all other investors in the Qualified Financing (the “Qualified Financing Securities”) and at a conversion price equal to the lowest price per share of Qualified Financing Securities paid by any other investor in the Qualified Financing (the “Qualified Financing Price”), with any resulting fraction of a share rounded down to the nearest whole share. The Holder shall be entitled to the same contractual rights and be bound by the same restrictions and obligations as the other purchasers of shares in the Qualified Financing. By acceptance of this Note, the Holder agrees to execute and deliver all documents and agreements necessary to evidence the grant of such rights to the Holder, and the imposition of such restrictions and obligations upon the Holder, as are executed by the purchasers of the shares in the Qualified Financing on or before the initial issuance thereof. "Qualified Financing" means, following the closing by the Company (or its successor) of the sale and issuance of Prior Notes and the Notes, the subsequent closing by the Company (or its successor) of the sale and issuance of capital stock of the Company (or its successor) in a single transaction or series of related transactions resulting in gross proceeds to the Company of not less than $5,000,000 (including new equity investment of at least $1,000,000 plus the sum of the outstanding principal amount of the Notes to be so converted pursuant to this Section 2(c)). Notwithstanding the foregoing, if the conversion of this Note pursuant to this Section 2 would otherwise result in the Holder, together with its affiliates, owning more than 5% of event the outstanding capital stock of the Maker, calculated on an as-converted fully-diluted basis (but not including as outstanding shares of capital stock issuable upon exercise or conversion of all outstanding stock options, warrants or other convertible securities of the Maker), immediately following the conversion of the Note (the “5% Threshold”), the Outstanding Amount shall be converted either pursuant to the first sentence of this Section 2 or, at the Holder’s option, into (i) that number of shares of Qualified Financing Securities that would result in the Maker reaching, but not exceeding, the 5% Threshold (the “5% Shares”), and (ii) an amount in cash equal to the difference between (A) the product of (1) the number of 5% Shares issued upon conversion, multiplied by (2) the Qualified Financing Price and (B) the Outstanding Amount. The Maker shall notify the Holder in writing of the anticipated occurrence of Company closes a Qualified Financing at least 10 days immediately prior to a Reverse Merger Transaction, this Note shall not convert upon the closing date of such Qualified Financing and shall in lieu of conversion under this Section 2(c) convert upon the Qualified Financingclosing by the Company of such Reverse Merger Transaction in accordance with the applicable terms and conditions of Section 2(d) below.

Conversion upon Qualified Financing. Effective upon a Qualified FinancingIn the event the Company consummates, all prior to the Loan Maturity Date, an equity financing, in one or more closings, pursuant to which it sells shares of its Capital Stock (the outstanding “Financing Equity Securities”) for an aggregate consideration of at least $10,000,000 (excluding the aggregate principal and accrued interest under due on this Convertible Note and all other convertible notes and simple agreements for future equity, if any, outstanding and issued by the Company as of the Closing Date) and with the principal purpose of raising capital at a pre-money equity valuation of $70,000,000 or greater (a “Qualified Financing”), then, at the “Outstanding Amount”) willoption of the Holder, either automatically in the case Holder may, during the 30-day period following its receipt of a the Qualified Financing that is not a Qualified Private FinancingNotice referenced below in this Section 5(a), or upon the elect by written election of the Holder provided notice to the Maker no later than five business days following delivery Company specifying the applicable Conversion Amount (which for purposes of the Financing Notice (the “Conversion Election”this Section 5(a) in the case of a Qualified Private Financing, shall be converted into shares of the same class and series of capital stock of the Maker issued to other investors less any interest on the same basis as principal being converted that accrues after the investment by such investors in date of notice from the Company concerning the Qualified Financing, including all contractual rightsthrough the date of the Holder’s election to convert, if anynot to exceed thirty (30) days) to have this Convertible Note converted upon the closing (or first in a series of closings) of such Qualified Financing. In the event the Holder elects to have this Convertible Note so converted, provided to all other investors in the Qualified Financing Conversion Amount shall convert into such number of shares of Common Stock obtained by dividing (i) the “Qualified Financing Securities”Conversion Amount, by (ii) and at a conversion price equal to the lowest price per share of Qualified Financing Securities paid by any other investor in the Qualified Financing (the “Qualified Financing Conversion Price”), with any resulting fraction of a share rounded down to the nearest whole share. Notwithstanding the foregoing, if the conversion of this Note pursuant to this Section 2 would otherwise result in the Holder, together with its affiliates, owning more Not less than 5% of the outstanding capital stock of the Maker, calculated on an as-converted fully-diluted basis thirty (but not including as outstanding shares of capital stock issuable upon exercise or conversion of all outstanding stock options, warrants or other convertible securities of the Maker), immediately following the conversion of the Note (the “5% Threshold”), the Outstanding Amount shall be converted either pursuant to the first sentence of this Section 2 or, at the Holder’s option, into (i30) that number of shares of Qualified Financing Securities that would result in the Maker reaching, but not exceeding, the 5% Threshold (the “5% Shares”), and (ii) an amount in cash equal to the difference between (A) the product of (1) the number of 5% Shares issued upon conversion, multiplied by (2) the Qualified Financing Price and (B) the Outstanding Amount. The Maker shall notify the Holder in writing of the anticipated occurrence of a Qualified Financing at least 10 days prior to the closing date of any Qualified Financing, Company will notify Holder (the “Qualified Financing Notice”) of the approximate Price Per Share at which Financing Equity Securities are being sold in such Qualified Financing, the approximate aggregate consideration (excluding the aggregate principal and accrued interest due on this Convertible Note and all other convertible notes and simple agreements for future equity, if any, outstanding and issued by the Company as of the Closing Date) being paid for such Financing Equity Securities and such other information as may reasonably be required to permit Holder to evaluate the desirability of electing to convert this Convertible Note.