Common use of Pre-Money Valuation Clause in Contracts

Pre-Money Valuation. In the event and to the extent that, upon the occurrence of a Liquidity Event, the Pre-Money Valuation of the applicable Issuer shall be less than $225,000,000, then and in such event the applicable number of Conversion Shares issuable upon any one or more Conversions of the Obligations shall be increased to that number of shares of Common Stock determined by (i) dividing (a) the amount of the outstanding Principal Amount of the Obligations that Holder elects to convert into Common Stock, by (b) the Per Share Price (the “Base Conversion Shares”), and multiplying the result of such calculation by a percentage (expressed as a decimal) determined by dividing (i) $225,000,000 by (ii) the lower Pre-Money Valuation at the time of the Liquidity Event. Accordingly for the avoidance of doubt if the Pre-Money Valuation in connection with a Liquidity Event was $200,000,000, the Base Conversion Shares would be adjusted and increased by 1.125 times (or the result of dividing $225,000,000 by $200,000,000).