Common use of Favored Nations Clause in Contracts

Favored Nations. During the period where any monies are owed to the Lender pursuant to the Note, if the Company engages in any e financing transactions with a third party investor, the Company will provide the Buyer with written notice (the “MFN Notice”) thereof promptly but in no event less than five (5) days prior to closing any financing transactions. Included with the MFN Notice shall be a copy of all documentation relating to such financing transaction and shall include, upon written request of the Buyer, any additional information related to such subsequent investment as may be reasonably requested by the Buyer. In the event the Buyer determines that the terms of the subsequent investment are preferable to the terms of the securities of the Company issued to the Buyer pursuant to the terms of this Agreement, the Buyer will notify the Company in writing. Promptly after receipt of such written notice from the Buyer, the Company agrees to amend and restate the Securities (which may include the conversion terms of the Note), to be identical to the instruments evidencing the subsequent investment. Notwithstanding the 14 foregoing, this Section 5(e) shall not apply in respect of (i) an Exempt Issuance, or (ii) an underwritten public offering of Common Stock. “Exempt Issuance” means the issuance of: (a) shares of Common Stock or options to employees, officers, consultants, advisors or directors of the Company pursuant to any stock or option plan duly adopted for such purpose by a majority of the members of the Board of Directors or a majority of the members of a committee of directors established for such purpose, and (b) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that any such issuance shall only be to a Person which is, itself or through its subsidiaries, an operating company in a business synergistic with the business of the Company and in which the Company receives benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.

Favored Nations. During the period where any monies (or Conversion Shares) are owed to the Lender Buyer pursuant to the Note, if the Company engages in any e future financing transactions with a third party investor, the Company will provide the Buyer with written notice (the “MFN Notice”) thereof promptly but in no event less than five (5) days prior to closing any financing transactions. Included with the MFN Notice shall be a copy of all documentation relating to such financing transaction and shall include, upon written request of the Buyer, any additional information related to such subsequent investment as may be reasonably requested by the Buyer. In the event the Buyer determines that the terms of the subsequent investment are preferable to the terms of the securities of the Company issued to the Buyer pursuant to the terms of this Agreement, the Buyer will notify the Company in writing. Promptly after receipt of such written notice from the Buyer, the Company agrees to amend and restate the Securities (which may include the conversion terms of the Note), to be identical to the instruments evidencing the subsequent investment. Notwithstanding the 14 foregoing, this Section 5(e) shall not apply in respect of (i) an Exempt Issuance, or (ii) an underwritten public offering of Common Stock. “Exempt Issuance” means the issuance of: (a) shares of Common Stock or options to employees, officers, consultants, advisors or directors of the Company pursuant to any stock or option plan duly adopted for such purpose by a majority of the members of the Board of Directors or a majority of the members of a committee of directors established for such purpose, and (b) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that any such issuance shall only be to a Person which is, itself or through its subsidiaries, an operating company in a business synergistic with the business of the Company and in which the Company receives benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.