Common use of Mandatory Conversion Clause in Contracts

Mandatory Conversion. In the event of a Series A-1 Mandatory Conversion, the share(s) of Series A-1 Preferred Stock subject to such Series A-1 Mandatory Conversion shall be automatically converted into fully paid and non-assessable share(s) of Series A Common Stock at the then effective Series A-1 Conversion Rate without any further action by the Corporation or holders of Series A-1 Preferred Stock and whether or not the certificate(s) representing such share(s) of Series A-1 Preferred Stock are surrendered to the Corporation; and the Corporation shall not be obligated to issue certificate(s) evidencing the share(s) of Series A Common Stock issuable upon such Series A-1 Mandatory Conversion unless the certificate(s) evidencing such share(s) of Series A-1 Preferred Stock are delivered to the Corporation, or the holder thereof notifies the Corporation that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificate(s). In case cash, securities or property other than Series A Common Stock shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 Preferred Stock may be converted into Series A Common Stock at the initial conversion rate of nine (9) fully paid and non-assessable share of Series A Common Stock for each share of Series A-1 Preferred Stock so converted (this conversion rate as from time to time adjusted cumulatively pursuant to the provisions of this Section is hereinafter referred to as the “Series A-1 Conversion Rate”).

Mandatory Conversion. In the event of a Series A-1 C-1 Mandatory Conversion, the share(s) of Series A-1 C-1 Preferred Stock subject to such Series A-1 C-1 Mandatory Conversion shall be automatically converted into fully paid and non-assessable share(s) of Series A C Common Stock at the then effective Series A-1 C-1 Conversion Rate without any further action by the Corporation or holders of Series A-1 C-1 Preferred Stock and whether or not the certificate(s) representing such share(s) of Series A-1 C-1 Preferred Stock are surrendered to the Corporation; and the Corporation shall not be obligated to issue certificate(s) evidencing the share(s) of Series A C Common Stock issuable upon such Series A-1 C-1 Mandatory Conversion unless the certificate(s) evidencing such share(s) of Series A-1 C-1 Preferred Stock are delivered to the Corporation, or the holder thereof notifies the Corporation that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificate(s). In case cash, securities or property other than Series A C Common Stock shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A C Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 C-1 Preferred Stock may be converted into Series A C Common Stock at the initial conversion rate of nine (9) [ ]4 fully paid and non-assessable share shares of Series A C Common Stock for each share of Series A-1 C-1 Preferred Stock so converted (this conversion rate as from time to time adjusted cumulatively pursuant to the provisions of this Section is hereinafter referred to as the “Series A-1 C-1 Conversion Rate”).

Mandatory Conversion. Upon the occurrence of a Fundamental Transaction (as defined below), the Borrower shall have the right, at its option, at any time and from time to time, so long as any amount remains payable under this Note, to convert all of the outstanding principal amount and accrued interest hereunder (the “Outstanding Amount”) into shares of Common Stock at a conversion price per share equal to the weighted average trading price of the Common Stock during the ten (10) trading days immediately preceding the date of such Fundamental Transaction (the “Conversion Price”). In the event that such Fundamental Transaction is a merger or consolidation of a Series A-1 Mandatory Conversionthe Borrower with or into another corporation or entity, the share(s) Purchaser shall be entitled to receive upon conversion of Series A-1 Preferred the Outstanding Amount, the number of shares of stock or other securities of the Borrower, or of the successor corporation resulting from such merger or consolidation, which a holder of the number of shares of Common Stock subject into which this Note was convertible immediately prior to such Series A-1 Mandatory Conversion transaction would have been entitled to receive as a result of such merger or consolidation. In any such case, appropriate adjustment shall be automatically converted into fully paid and non-assessable share(s) made in the application of Series A Common Stock at the then effective Series A-1 Conversion Rate without any further action by the Corporation or holders of Series A-1 Preferred Stock and whether or not the certificate(s) representing such share(s) of Series A-1 Preferred Stock are surrendered to the Corporation; and the Corporation shall not be obligated to issue certificate(s) evidencing the share(s) of Series A Common Stock issuable upon such Series A-1 Mandatory Conversion unless the certificate(s) evidencing such share(s) of Series A-1 Preferred Stock are delivered to the Corporation, or the holder thereof notifies the Corporation that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificate(s). In case cash, securities or property other than Series A Common Stock shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 Preferred Stock may be converted into Series A Common Stock at the initial conversion rate of nine (9) fully paid and non-assessable share of Series A Common Stock for each share of Series A-1 Preferred Stock so converted (this conversion rate as from time to time adjusted cumulatively pursuant to the provisions of this Section 6 with respect to the rights of the Purchaser after such merger or consolidation to the end that the provisions of this Section 6 (including adjustment of the number of shares of Common Stock issuable upon conversion of this Note) shall be applicable after that event and be as nearly equivalent to the provisions hereof as may be practicable. “Fundamental Transaction” means (i) a merger or consolidation of the Borrower with or into another corporation or entity, (ii) a sale of all or substantially all of the Borrower’s properties and assets to any other person, or (iii) the sale, transfer or assignment of not less than fifty percent (50%) of the Borrower’s then issued and outstanding shares of Common Stock by the beneficial owners thereof to a person or persons that are not Affiliates (as defined below) of such beneficial owners. “Affiliate” means, when used with respect to a specified person, another person that either directly or indirectly, through one or more intermediaries, controls, is hereinafter referred to as the “Series A-1 Conversion Rate”)controlled by, or is under common control with, such specified person.

Mandatory Conversion. In Provided that (a) there is an effective Registration Statement on Form SB-2 or S-3 (the event “Registration Statement”) on file with the Securities and Exchange Commission (the “SEC”) registering the maximum number of a shares of Common Stock to be issued upon conversion of the Series A-1 Mandatory Conversion, the share(s) of Series A-1 A Preferred Stock subject and (b) the closing price of the Common Stock for the twenty (20) preceding trading days is equal to such Series A-1 Mandatory or greater than two times the Conversion shall be automatically converted into fully paid and non-assessable share(s) Price, then the Corporation, at its option, may require any holder of Series A Preferred Stock to convert all, or a portion, of the then outstanding Series A Preferred Stock by delivery of written notice. The conversion shall be made within five (5) trading days after receipt of the notice. Notwithstanding the foregoing, any conversion by a holder of Series A Preferred Stock into Common Stock at the then effective Series A-1 Conversion Rate without shall be limited, for each and any further action by the Corporation or holders of Series A-1 Preferred Stock and whether or not the certificate(s) representing such share(s) of Series A-1 Preferred Stock are surrendered holder who so elects in writing to the Corporation; , such that the beneficial ownership of such holder and its affiliates of Common Stock acquired from the Corporation shall not be obligated to issue certificate(s) evidencing the share(s) (excluding shares of Series A Common Stock issuable upon such the conversion of the Series A-1 Mandatory Conversion unless the certificate(s) evidencing such share(s) of Series A-1 A Preferred Stock are delivered to and the Corporation, exercise of warrants which have not yet been converted or exercised) shall in the holder thereof notifies aggregate not exceed 9.99% of the total Common Stock then outstanding. In the event that the Corporation that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to provides notice of the Corporation to indemnify mandatory conversion of the Corporation from any loss incurred by it in connection with such certificate(s). In case cash, securities or property other than then outstanding Series A Common Stock shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 Preferred Stock may be converted into Series A Common Stock at which is limited by the initial conversion rate of nine (9) fully paid and non-assessable share of Series A Common Stock for each share of Series A-1 Preferred Stock so converted (this conversion rate as from time to time adjusted cumulatively pursuant to immediately preceding sentence, the provisions of this Section is hereinafter referred (c) hereof with respect to dividends, Section (d) hereof with respect to liquidation preference of the Series A Preferred Stock, Section (e)(ii) hereof with respect to voting rights, Sections (f)(ix) and (f)(x) hereof with respect to adjustments to the Conversion Price and Section (h) hereof with respect to Events of Default, shall each expire as of the “Series A-1 Conversion Rate”)effectiveness of such mandatory conversion.

Mandatory Conversion. In the event (i) If any Series A Holder voluntarily or involuntarily transfers, sells, assigns, devises, distributes or bequeaths any of a such Series A-1 Mandatory ConversionA Holder’s interest in any shares of Series A Preferred (including, without limitation, the share(s) power to vote or provide a consent with respect to any shares of Series A-1 A Preferred Stock by proxy or otherwise) (a “Transfer”) to any Person (the “Transferee”) other than a Permitted Transferee, then each share of Series A Preferred subject to such Transfer automatically, without any action on the part of the Company or such Series A-1 Mandatory Conversion shall A Holder, will be automatically deemed to be converted into one share of fully paid and non-assessable share(s) Series B Preferred immediately before such transfer is completed. In the event of such a transfer, the Company and the transfer agent for the Series A Preferred, if any (the “Transfer Agent”), shall not register the transfer of such shares of Series A Common Stock at Preferred except to the then effective Company or a Permitted Transferee of such Series A-1 Conversion Rate without any further action by A Holder; provided, however, that such restrictions on transfer shall not apply to a Business Combination of the Corporation Company with or holders of Series A-1 Preferred Stock and whether into another corporation or entity, if the Company is not the certificate(sSurviving Person. (ii) representing such share(s) of Series A-1 Preferred Stock are surrendered Notwithstanding anything to the Corporation; and the Corporation shall not be obligated to issue certificate(s) evidencing the share(s) of contrary set forth herein, any Series A Common Stock issuable upon Holder may pledge such Series A-1 Mandatory Conversion unless the certificate(s) evidencing A Holder’s shares to a financial institution pursuant to a bona fide pledge of such share(s) shares as collateral security of Series A-1 Preferred Stock are delivered indebtedness due to the Corporationpledgee; provided, or the holder thereof notifies the Corporation however, that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificate(s). In case cash, securities or property other than Series A Common Stock shares shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 Preferred Stock may be converted into Series A Common Stock at the initial conversion rate of nine (9) fully paid and non-assessable share of Series A Common Stock for each share of Series A-1 Preferred Stock so converted (this conversion rate as from time to time adjusted cumulatively pursuant remain subject to the provisions of this Section is hereinafter referred 8(b) and may not be voted by the pledgee and, upon any transfer of such shares to the pledgee, such shares shall convert into Series B shares in accordance with paragraph (i) above. (iii) Each certificate representing shares of Series A Preferred shall be endorsed with a legend that states that immediately prior to any Transfer of such shares of Series A Preferred such shares automatically will be converted into shares of Series B Preferred in accordance with the Restated Articles, and no such transfer will be valid unless such transfer has been recorded in stock transfer records kept by the Company or the Transfer Agent. (iv) To effect any Transfer of Series A Preferred (which shall be converted into shares of Series B Preferred immediately prior to such Transfer as set forth in this Section 8(b)), the “Series A-1 Conversion Rate”)A Holder proposing to transfer such converted shares of Series A Preferred must surrender the certificate(s) representing such shares at the office of the Company or the Transfer Agent for the Series A Preferred with instructions identifying the Transferee proposed to receive converted shares of Series B Preferred. Thereupon, there shall be issued and delivered to such Transferee at such office in the name of the Transferee a certificate or certificates for the number of shares of Series B Preferred into which the Series A Preferred were converted.

Mandatory Conversion. In (A) Upon request by the event Corporation delivered no earlier than five (5) Business Days prior to a determination date with respect to the Corporation’s status as a “well-known seasoned issuer” (as defined in Rule 405 under the Securities Act), if the Corporation has made a bona fide determination that the conversion of all or a Series A-1 Mandatory Conversion, portion of the share(s) of Series A-1 Preferred Stock subject to such Series A-1 Mandatory Conversion shall be automatically converted into fully paid and non-assessable share(s) outstanding shares of Series A Common Preferred Stock at the then effective Series A-1 Conversion Rate without any further action by would, if converted, cause the Corporation or holders of Series A-1 Preferred Stock and whether or not the certificate(s) representing such share(s) of Series A-1 Preferred Stock are surrendered to the Corporation; qualify as a “well-known seasoned issuer” (and the Corporation shall would otherwise not be obligated to issue certificate(s) evidencing qualify as a “well-known seasoned issuer” absent the share(s) conversion of such shares of Series A Common Stock issuable upon such Series A-1 Mandatory Conversion unless the certificate(s) evidencing such share(s) of Series A-1 Preferred Stock are delivered to the Corporation, or the holder thereof notifies the Corporation that such certificate(s) have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificate(sStock). In case cash, securities or property other than Series A Common Stock shall be payable, deliverable or issuable upon conversion as provided herein, then all references to Series A Common Stock in this Section 5 shall be deemed to apply, so far as appropriate and as nearly as may be, to such cash, property or other securities. Subject to the provisions for adjustment hereinafter set forth in this Section 5, the Series A-1 Preferred Stock may be converted into Series A Common Stock at the initial conversion rate number of nine (9) fully paid and non-assessable share shares of Series A Preferred Stock that would be required, if converted, to qualify the Corporation as a “well-known seasoned issuer” shall be converted, ratably, into a number of shares of Common Stock for each share of Series A-1 Preferred Stock so converted (this conversion rate equal to the Conversion Ratio, as adjusted from time to time adjusted cumulatively pursuant to Section 7, or (B) upon request by the provisions Corporation delivered no earlier than five (5) Business Days prior to a record date for a shareholder meeting of the Corporation, but subject to the prior written consent of each Holder, not to be unreasonably withheld, a reasonably requested number of Series A Preferred Stock shall be converted, ratably, into the number of shares of Common Stock equal to the Conversion Ratio, as adjusted from time to time pursuant to Section 7 ((A) and (B) together, the “Mandatory Conversion Request”), provided that in no event shall shares of Series A Preferred Stock be converted pursuant to this Section 6(a)(i) if the conversion of such shares of Series A Preferred Stock would cause a Holder to exceed the Beneficial Ownership Limitation (as defined below). The date of conversion of outstanding shares of Series A Preferred Stock pursuant to this Section 6(a)(i) is hereinafter referred to herein as the “Series A-1 Mandatory Conversion RateDate.”).