Common use of Automatic Exchange Clause in Contracts

Automatic Exchange. Each of the FX Shares then outstanding will be automatically exchanged, without election or further action by the Company or the holders of the FX Shares, for the number of fully paid and non-assessable shares of Company Common Stock determined in accordance with the provisions of Section 4 of this Agreement, upon the effective date of a Registration Statement filed by the Company with the Commission in connection with a Qualified Public Offering. The Company shall give notice of the Exchange under this Section 2(c) to the Member Representative in accordance with Section 3 below. The closing of the Exchange will take place at the time and place and in the manner set forth in Section 5 below. Notwithstanding the later closing of the Exchange, the effective date of the Exchange will be the date the Registration Statement for the Qualified Public Offering is declared effective by the Commission, and the Holders entitled to receive the Exchange Shares issuable upon the Exchange will be treated for all purposes as the record holders of the Exchange Shares on that date.