Common use of Corporate Transaction or IPO Clause in Contracts

Corporate Transaction or IPO. In the event of a Corporate Transaction or Initial Public Offering (each, a “Strategic Event”) prior to full payment of a Note or prior to the time when a Note may be converted (as provided herein), all outstanding principal and unpaid accrued interest due on such Note shall be converted into Conversion Shares immediately prior to such Strategic Event; provided, in the case of an Initial Public Offering, such conversion shall be deemed to take place prior to the Mandatory Conversion Time (as defined in the Company’s Certificate of Incorporation). The number of Conversion Shares to be issued upon conversion shall be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on a Note to be converted on the date of conversion by the Conversion Price. At least ten (10) business days prior to the closing of a Strategic Event, the Company shall notify the holder of each Note in writing of the occurrence of the Strategic Event (the “Strategic Event Notice”). Within five (5) business days after the Strategic Event Notice is effectively given by the Company, a holder shall inform the Company of its election to convert the Note into either (x) Series B-3 Preferred Stock or (y) any more recent series of the Company’s Equity Securities. In the event that a holder fails to inform the Company of its election within such five (5) business day period, such holder’s Note shall convert into Series B-3 Preferred Stock.