Common use of Automatic Conversions Clause in Contracts

Automatic Conversions. This Note shall be automatically converted into that number of shares of Series A Preferred Stock equal to the quotient of (a) the aggregate principal amount of this Note then outstanding divided by (b) the Conversion Price, under the following conditions: i) Upon the consummation of the First Equity Financing; ii) Immediately prior to the closing of any merger, sale or other consolidation of the Company or of any sale of all or substantially all assets of the Company which occurs prior to the First Equity Financing (an “Acquisition Event”). Notwithstanding the above, and only in the event that a conversion resulting from such Acquisition Event would result in a security not traded on a national stock exchange (including NASDAQ and NASDAQ small cap), upon written notice to the Company not later than 5 days after the consummation of the Acquisition Event and notice of the Acquisition Event to the Holder of the Note, the Holder may elect to receive payment in cash of the entire outstanding principal of this Note.