Common use of Conversion or Redemption Clause in Contracts

Conversion or Redemption. (a) The conversion price for this Note shall equal USD $1.20 (the “Conversion Price”). (b) On or after April 1, 2027, the Holder shall have the right to accelerate and redeem, in one or more instances, an aggregate amount of up to $6,900,000 of the Principal Amount (each occurrence, a “Redemption”, and each amount redeemed, the “Redeemed Amount”), by properly delivering a notice of Redemption to the Company in accordance with Section 14. Upon the Company’s receipt of each such notice, the Company shall make payment to Holder of the Redemption Amount within thirty (30) days. Effective upon payment of each Redemption, the Principal Balance of this Note shall be reduced by the Redeemed Amount automatically without any further action by the parties. (c) Subject to the Conversion and Exercise Share Cap (as such term is defined in the Purchase Agreement), (i) the then-outstanding Principal Amount of this Note shall be convertible into shares of Common Stock, in the sole discretion of the Holder prior to or on the Maturity Date, and shall convert into that number of shares of Common Stock as shall equal the Principal Amount of the Note being converted divided by the Conversion Price; and (ii) the outstanding Convertible Interest shall be convertible into shares of Common Stock in accordance with Section 3. Any partial conversion of this Note shall cause the Principal Amount of this Note to be reduced by the amount of principal converted by the Holder. If the number of shares of Common Stock deliverable upon conversion of the Principal Amount and/or the Convertible Interest would result in the issuance of shares of Common Stock in excess of the Conversion and Exercise Share Cap, the Company will not have any further obligation to deliver any shares of Common Stock or pay any cash in excess of the Conversion and Exercise Share Cap for such conversion. The Holder shall effect conversions of the Principal Amount by delivering to the Company the form of Notice of Conversion attached hereto. The Holder shall be presumed to elect to receive the Convertible Interest in shares of Common Stock. The Holder may deliver notice to elect to receive the Convertible Interest in cash or shares of Common Stock at any time, with such notice becoming effective for the quarter it is delivered to and acknowledged by the Company (or such later period if set forth in the notice), such election continuing until the Holder delivers a notice to change its election. (d) Upon conversion of the Note, the outstanding principal and Convertible Interest, if any, shall be converted without any further action by the Holder and whether or not the Note is surrendered to the Company or its transfer agent. The Company shall not be obligated to issue certificates evidencing the shares of the securities issuable upon such conversion unless such Note is either delivered to the Company or its transfer agent, or the Holder notifies the Company or its transfer agent that such Note has been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such Note. The Company shall, as soon as practicable, but in any event within ten (10) days after such delivery, or such agreement and indemnification, issue and deliver at such office to such Holder of such Note, a certificate or certificates (or electronic book-entry statements) for the securities to which the Holder shall be entitled. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of closing of the transaction causing conversion. The person or persons entitled to receive securities issuable upon such conversion shall be treated for all purposes as the record Holder or Holders of such securities on such date. (e) If at any time the number of shares of equity securities issuable upon conversion of this Note shall not be sufficient to effect the conversion of this Note, the Company will use all commercially reasonable efforts to effect such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of equity securities issuable upon conversion of this Note as shall be sufficient for such purpose.

Conversion or Redemption. (a) The conversion price for this Note Following the initial filing by the Company of a registration statement in connection with the IPO and at least 30 days prior to the anticipated effective date of such registration statement, the Company shall equal USD $1.20 provide written notice (the “Conversion PriceCompany Notice”) to Holder of the filing of such registration statement. Holder shall elect, by delivery of a written notice, substantially in the form attached as Annex 1 (the “Exercise Notice”). (b, to Company within 15 days of Holder’s receipt of the Company Notice, to convert this Note upon the IPO, in whole or in part, pursuant to Section 3(a)(i) On above, if the IPO takes place on or after April 120 December 2006, 2027but prior to the Maturity Date, or to have this Note then redeemed, in whole or in part, pursuant to Section 3(a)(ii) above, if the IPO takes place at any time prior to the Maturity Date. If the Holder elects to convert this Note in part into Common Stock pursuant to Section 3(a)(i) above and to have this Note in part redeemed pursuant to Section 3(a)(ii) above, the Holder shall have specify the portion of Principal that shall be converted into Common Stock and the portion of Principal that shall be redeemed in the Exercise Notice. The Holder’s right to accelerate and redeem, elect partial conversion or redemption of this Note may be exercised in one or more instances, an aggregate amount increments of up U.S.$100,000. In the event Holder fails to $6,900,000 of the Principal Amount (each occurrence, a “Redemption”, and each amount redeemed, the “Redeemed Amount”), by properly delivering a notice of Redemption respond to the Company Notice in a timely manner, the Company shall understand such failure to mean that Holder has elected to redeem this Note in accordance with Section 143(a)(ii) above. Upon Notwithstanding the Company’s receipt of each such noticeforegoing, the Company shall make payment to Holder of the Redemption Amount within thirty (30) days. Effective upon payment of each Redemption, the Principal Balance of this Note shall be reduced by the Redeemed Amount automatically without any further action by the parties. (c) Subject to the Conversion and Exercise Share Cap (as such term is defined in the Purchase Agreement), (i) the then-outstanding Principal Amount of this Note shall be convertible into shares of Common Stock, in the sole discretion of the Holder prior to or on the Maturity Date, and shall convert into that number of shares of Common Stock as shall equal the Principal Amount of the Note being converted divided by the Conversion Price; and (ii) the outstanding Convertible Interest shall be convertible into shares of Common Stock in accordance with Section 3. Any partial conversion of this Note shall cause the Principal Amount of this Note to be reduced by the amount of principal converted by the Holder. If the number of shares of Common Stock deliverable upon conversion of the Principal Amount and/or the Convertible Interest would result in the issuance of shares of Common Stock in excess of the Conversion and Exercise Share Cap, the Company will not have any further obligation to deliver any shares of Common Stock or pay any cash in excess of the Conversion and Exercise Share Cap for such conversion. The Holder shall effect conversions of the Principal Amount by delivering to the Company the form of Notice of Conversion attached hereto. The Holder shall be presumed to elect to receive the Convertible Interest in shares of Common Stock. The Holder may deliver notice to elect to receive the Convertible Interest in cash or shares of Common Stock at any time, with such notice becoming effective for the quarter it is delivered to and acknowledged by the Company (or such later period if set forth in the notice), such election continuing until the Holder delivers a notice to change its election. (d) Upon conversion of the Note, the outstanding principal and Convertible Interest, if any, shall be converted without any further action by the Holder and whether or not the Note is surrendered to the Company or its transfer agent. The Company shall not be obligated to issue certificates evidencing deliver the shares IPO Conversion Shares issued upon conversion of this Note by the securities issuable upon such conversion Holder or pay the IPO Redemption Price unless such the original of this Note is either delivered to the Company or its transfer agent, or the Holder notifies the Company or its transfer agent in writing that such original of this Note has been lost, stolen or destroyed destroyed, and Holder executes an agreement reasonably satisfactory to the Company to to, among other things, indemnify the Company from any loss incurred by it the Company in connection with such original of this Note. The Upon surrender by Holder to the Company shallof the original of this Note at the office of the Holder to an authorized representative of the Company, as soon as practicable, but in any event within ten (10) days after such delivery, or such agreement and indemnification, representative shall issue and deliver to Holder promptly at such office to such Holder of such Note, a certificate or certificates (or electronic book-entry statements) for the securities to which the Holder shall be entitled. Such conversion shall be deemed to have been made immediately prior to the close of business and in Holder’s name as shown on the date of closing of the transaction causing conversion. The person or persons entitled to receive securities issuable upon such conversion shall be treated for all purposes as the record Holder or Holders of such securities on such date. (e) If at any time the number of shares of equity securities issuable upon conversion of this Note shall not be sufficient to effect the conversion original of this Note, the Company will use all commercially reasonable efforts IPO Conversion Shares or the IPO Redemption Price pursuant to effect such corporate action as may, the information provided in the opinion of its counsel, be necessary to increase its authorized but unissued shares of equity securities issuable upon conversion of this Note as shall be sufficient for such purposeExercise Notice under “4. Settlement”.