Section 1202 of the Code Sample Clauses

Section 1202 of the Code. The capital stock issuable hereunder, to the Company’s knowledge, will constitute “qualified small business stock” within the meaning of Section 1202 of the Code as of the date of issuance and the Company hereby represents and warrants that it shall continue to do the following: (a) use its reasonable efforts to comply with the reporting and record keeping requirements of Section 1202 of the Code and any regulations promulgated thereunder; and (b) use its best efforts to provide the Investors with notice at least ten (10) business days prior to taking any of the following actions: (i) Within the two-year period ending one year from the date hereof, purchase an amount of its own stock (within the meaning of Section 1202(c)(3) of the Code) having an aggregate value at the time(s) of purchase exceeding five percent of the aggregate value of all of its outstanding stock determined as of the start of such period; (ii) Conduct any of the following businesses (as defined for purposes of Section 1202(e)(3) of the Code): A. any business involving the performance of services in the fields of law, accounting, actuarial science, performing arts, athletics, or brokerage services; B. any banking or insurance business; C. any farming business (including the business of raising or harvesting trees); D. any business involving the production or extraction of natural resources with respect to which a deduction is allowable under Section 613 or 613A of the Code; or E. any business of operating a hotel, motel, restaurant or similar establishment; (c) not permit more than 10 percent of the value of its assets to consist of stock issued by other companies (other than stock of companies that qualify as subsidiaries of the Company within the meaning of Section 1202(e)(5) of the Code or stock that is held as working capital or reasonably expected to be sold within two years to finance research and experimentation within the meaning of Section 1202(e)(6) of the Code); (d) not permit more than 10 percent of the value of its assets to consist of real property which is not used in the active conduct of a qualified trade or business within the meaning of Section 1202(e)(7) of the Code; (e) not make an election under Section 936 of the Code (relating to the Puerto Rico and possessions tax credit) or permit a subsidiary to make such an election; or (f) in a single transaction or series of related transactions, not raise capital of more than $1 million through the issuance of securities or...