Common use of Qualifying IPO Clause in Contracts

Qualifying IPO. (i) If a Qualifying IPO occurs prior to the Maturity Date, then effective as of the closing date of such Qualifying IPO, the Series 2 Note Obligation Amount shall automatically convert in full into a number of Conversion Shares equal to: (x) the outstanding Series 2 Note Obligations Amount on such closing date, divided by (y) a price per share (the “IPO Conversion Price”) equal to (A) 90% of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or before September 30, 2022; (B) 85% of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or after October 1, 2022 but on or before December 31, 2022; or (C) 80% of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or after January 1, 2023. If, in the case of a Qualifying IPO described in clause (b) of the definition thereof, such gross price per share is not readily identifiable, then such gross price per share shall be deemed to equal the average of the last reported per share sale price of the successor entity’s common stock on the public securities market on which it is primarily traded for the twenty (20) consecutive trading days immediately prior to the closing date of such Qualifying IPO; provided, however, that if no sales of such common stock occurred on any such trading day, the mean between the closing “bid” and “asked” per share prices for such common stock on such trading day shall be used in lieu of the last reported per share sale price for such trading day. (ii) No later than five (5) business days following the closing date of a Qualifying IPO, the Company shall provide the Holder with written notice of the conversion of the Series 2 Note Obligation Amount into Conversion Shares in accordance with Section 3.1(a)(i), specifying the Series 2 Note Obligation Amount so converted, the IPO Conversion Price, the number of Conversion Shares into which such Series 2 Note Obligation Amount has been converted and the effective date of such conversion, and requesting the Holder to surrender this Series 2 Note to the Company in the manner and at the place designated in such notice. The Holder agrees to deliver the original of this Series 2 Note to the Company for cancellation not later than ten (10) days after its receipt of such notice; provided, however, that from and after the closing date of such Qualifying IPO, the Series 2 Note Obligation Amount shall be deemed to have been fully converted into Conversion Shares and this Series 2 Note shall be deemed to have been paid in full, whether or not it is delivered for cancellation as set forth in this sentence. From and after the closing date of such Qualifying IPO, the Holder shall be treated for all purposes as the record holder of the Conversion Shares into which the Series 2 Note Obligation Amount has been converted in accordance with this Section 3.1(a). The Holder shall be entered into the register of holders of Common Stock effective as of the closing date of the Qualifying IPO and the Company shall promptly provide (or cause to be provided) to the Holder evidence of same. (iii) Notwithstanding anything in this Series 2 Note to the contrary, if there shall occur a Qualifying IPO described in clause (b) of the definition thereof in which the Common Stock is converted into or exchanged for securities, cash or other property then, upon conversion of the Series 2 Note Obligation Amount pursuant to Section 3.1(a)(i), the Holder shall be entitled to receive (in lieu of the Conversion Shares) the kind and amount of securities, cash or other property which the holder would have been entitled to receive if (a) such Series 2 Note Obligation Amount (or portion thereof) had been converted into the number of Conversion Shares that the Holder would otherwise have been entitled to receive pursuant to Section 3.1(a)(i) and (b) immediately after giving effect to such conversion, the number of Conversion Shares determined pursuant to clause (a) above had been sold, exchanged or otherwise disposed of by such Holder in accordance with the terms of such Qualifying IPO (such securities, cash and other property, the “Alternative Conversion Consideration”). In the event any such event occurs, the Company shall make such equitable adjustments in the application of the provisions of this Section 3.1(a) as it determines are appropriate with respect to the rights and interests thereafter of the Holder, to the end that the provisions set forth in this Section 3.1(a) shall thereafter be applicable, as nearly as reasonably may be, in relation to the Alternative Conversion Consideration deliverable upon conversion of the Series 2 Note Obligation Amount.

Qualifying IPO. (i) If a Qualifying IPO occurs prior to the Maturity Date, then effective as of the closing date of such Qualifying IPO, the Series 2 Note Obligation Amount shall automatically convert in full into a number of Conversion Shares equal to: (x) the outstanding Series 2 Note Obligations Amount on such closing date, divided by (y) a price per share (the “IPO Conversion Price”) equal to the lesser of (A) 90% (or, if the closing date of such Qualifying IPO occurs after February 28, 2022, 80%) of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or before September 30, 2022; and (B) 85% of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or after October 1, 2022 but on or before December 31, 2022; or (C) 80% of the gross price per share at which Common Stock is sold in the Qualifying IPO, if the Qualifying IPO occurs on or after January 1, 2023Valuation Cap Amount. If, in the case of a Qualifying IPO described in clause (b) of the definition thereof, such gross price per share is not readily identifiable, then such gross price per share shall be deemed to equal the average of the last reported per share sale price of the successor entity’s common stock on the public securities market on which it is primarily traded for the twenty (20) consecutive trading days immediately prior to the closing date of such Qualifying IPO; provided, however, that if no sales of such common stock occurred on any such trading day, the mean between the closing “bid” and “asked” per share prices for such common stock on such trading day shall be used in lieu of the last reported per share sale price for such trading day. (ii) No later than five (5) business days following the closing date of a Qualifying IPO, the Company shall provide the Holder with written notice of the conversion of the Series 2 Note Obligation Amount into Conversion Shares in accordance with Section 3.1(a)(i), specifying the Series 2 Note Obligation Amount so converted, the IPO Conversion Price, the number of Conversion Shares into which such Series 2 Note Obligation Amount has been converted and the effective date of such conversion, and requesting the Holder to surrender this Series 2 Note to the Company in the manner and at the place designated in such notice. The Holder agrees to deliver the original of this Series 2 Note to the Company for cancellation not later than ten (10) days after its receipt of such notice; provided, however, that from and after the closing date of such Qualifying IPO, the Series 2 Note Obligation Amount shall be deemed to have been fully converted into Conversion Shares and this Series 2 Note shall be deemed to have been paid in full, whether or not it is delivered for cancellation as set forth in this sentence. From and after the closing date of such Qualifying IPO, the Holder shall be treated for all purposes as the record holder of the Conversion Shares into which the Series 2 Note Obligation Amount has been converted in accordance with this Section 3.1(a). The Holder shall be entered into the register of holders of Common Stock effective as of the closing date of the Qualifying IPO and the Company shall promptly provide (or cause to be provided) to the Holder evidence of same. (iii) Notwithstanding anything in this Series 2 Note to the contrary, if there shall occur a Qualifying IPO described in clause (b) of the definition thereof in which the Common Stock is converted into or exchanged for securities, cash or other property then, upon conversion of the Series 2 Note Obligation Amount pursuant to Section 3.1(a)(i), the Holder shall be entitled to receive (in lieu of the Conversion Shares) the kind and amount of securities, cash or other property which the holder would have been entitled to receive if (a) such Series 2 Note Obligation Amount (or portion thereof) had been converted into the number of Conversion Shares that the Holder would otherwise have been entitled to receive pursuant to Section 3.1(a)(i) and (b) immediately after giving effect to such conversion, the number of Conversion Shares determined pursuant to clause (a) above had been sold, exchanged or otherwise disposed of by such Holder in accordance with the terms of such Qualifying IPO (such securities, cash and other property, the “Alternative Conversion Consideration”). In the event any such event occurs, the Company shall make such equitable adjustments in the application of the provisions of this Section 3.1(a) as it determines are appropriate with respect to the rights and interests thereafter of the Holder, to the end that the provisions set forth in this Section 3.1(a) shall thereafter be applicable, as nearly as reasonably may be, in relation to the Alternative Conversion Consideration deliverable upon conversion of the Series 2 Note Obligation Amount.