Common use of Optional and Mandatory Conversion Clause in Contracts

Optional and Mandatory Conversion. The Payee may, at its option, upon written notice to the Maker given at any time and from time to time, convert all or any portion of the unpaid Principal balance of this Note, and/or any accrued Interest thereon, into shares of common stock of the Maker (“Common Stock”), at a price of Eighty ($.80) Cents per share of Common Stock (as same may be adjusted from time to time in accordance herewith, the “Conversion Price”). In addition, if (i) there is not then continuing any Default or Event of Default under and as defined in the Loan Agreement, (ii) the Common Stock is then traded or listed for trading on any national securities exchange or the NASDAQ National Market or NASDAQ Capital Market, (iii) there is then in effect a valid registration statement under the Securities Act of 1933, as amended, in respect of the Common Stock issued and issuable upon conversion of this Note and upon exercise of the Warrants issued pursuant to the Loan Agreement, such that all such shares of Common Stock will be freely tradable immediately upon issuance at such time, (iv) the Maker is current in all of its required filings with the Securities and Exchange Commission, (v) the reported Trading Price (as hereinafter defined) of the Common Stock for each of the twenty (20) consecutive trading days immediately prior thereto has been equal to or greater than 165% of the Conversion Price in effect on each such trading day, and (vi) the average daily trading volume of the Common Stock as reported by the principal exchange or trading medium on which the Common Stock is listed or quoted has been equal to or greater than 100,000 shares (such number to be subject to adjustment on a proportionate basis in the event of each and every stock split, stock dividend, combination of shares, recapitalization or other such event respecting the Common Stock which may occur subsequent to the date hereof) during the three (3) months immediately prior thereto, then the Maker may, upon five (5) business days’ prior written notice to the Payee, require the Payee to convert all or any portion of the Principal of this Note into shares of Common Stock at the Conversion Price then in effect; and in the event of any such conversion at the option of the Maker, the Maker shall give written notice thereof to the Payee certifying as to the satisfaction of the foregoing conditions (including a detailed schedule of Trading Prices and volumes for purposes of the foregoing clauses (v) and (vi)), and shall pay to the Payee, simultaneously with the delivery of stock certificates in accordance with Section 3(c), all unpaid accrued Interest on the Principal amount so converted. As used herein, the term “Trading Price” on any relevant date means the closing sale price (or, if no closing sale price is reported, the last reported sale price) of the Common Stock (regular way). The effective date of any conversion hereunder is herein referred to as the “Conversion Date.” To the extent that this Note is converted only in part, then such conversion shall be treated as a prepayment of the Principal amount converted in accordance with Section 2(d) above, provided that no prepayment premium shall be required in respect of any conversion.

Optional and Mandatory Conversion. The Payee may, at its option, upon written notice to the Maker given at any time and from time to time, convert all or any portion of the unpaid Principal balance of this Note, and/or any accrued Interest thereon, into shares of common stock of the Maker (“Common Stock”), at a price of Eighty ($.80) Cents 1.50 per share of Common Stock (as same may be adjusted from time to time in accordance herewith, the “Conversion Price”). In addition, if (i) there is not then continuing any Default or Event of Default under and as defined in the Loan Agreement, (ii) the Common Stock is then traded or listed for trading on any national securities exchange exchange, the NASDAQ Global Market, the NASDAQ Select Market or any other NASDAQ market, or the NASDAQ National Market or NASDAQ Capital MarketOTC Bulletin Board, (iii) there is then in effect a valid registration statement under the Securities Act of 1933, as amended, in respect of the Common Stock issued and issuable upon conversion of this Note and upon exercise of the Warrants issued pursuant to the Loan Agreement, such that all such shares of Common Stock will be freely tradable immediately upon issuance at such time, (iv) the Maker is current in all of its required filings with the Securities and Exchange CommissionCommission and all other regulatory filings, (v) the reported Trading Price (as hereinafter defined) of the Common Stock for each of the twenty (20) consecutive trading days immediately prior thereto has been equal to or greater than 165150% of the Conversion Price in effect on each such trading day, and (vi) the average daily trading volume of the Common Stock as reported by the principal exchange or trading medium on which the Common Stock is listed or quoted has been equal to or greater than 100,000 50,000 shares (such number to be subject to adjustment on a proportionate basis in the event of each and every stock split, stock dividend, combination of shares, recapitalization or other such event respecting the Common Stock which may occur subsequent to the date hereof) during the three (3) months immediately prior thereto, then the Maker may, upon five (5) business days’ prior written notice to the Payee, require the Payee to convert all or any portion of the Principal of this Note into shares of Common Stock at the Conversion Price then in effect; and in the event of any such conversion at the option of the Maker, the Maker shall give written notice thereof to the Payee certifying as to the satisfaction of the foregoing conditions (including a detailed schedule of Trading Prices and volumes for purposes of the foregoing clauses (v) and (vi)), and shall pay to the Payee, simultaneously with the delivery of stock certificates in accordance with Section 3(c), all unpaid accrued Interest on the Principal amount so converted. As used herein, the term “Trading Price” on any relevant date means the closing sale price (or, if no closing sale price is reported, the last reported sale price) of the Common Stock (regular way). The effective date of any conversion hereunder is herein referred to as the “Conversion Date.” To the extent that this Note is converted only in part, then such conversion shall be treated as a prepayment of the Principal amount converted in accordance with Section 2(d) above, provided that no prepayment premium shall be required in respect of any conversion.

Optional and Mandatory Conversion. The Payee may, at its option, upon written notice to the Maker given at any time and from time to time, convert all or any portion of the unpaid Principal balance of this Note, and/or any accrued Interest thereon, into shares of common stock of the Maker (“Common Stock”), at a price of Eighty ($.80) .77 Cents per share of Common Stock (as same may be adjusted from time to time in accordance herewith, the “Conversion Price”). In addition, if (i) there is not then continuing any Default or Event of Default under and as defined in the Loan Agreement, (ii) the Common Stock is then traded or listed for trading on any national securities exchange or the NASDAQ National Nasdaq Global Market or NASDAQ Capital the Nasdaq Global Select Market, (iii) there is then in effect a valid registration statement under the Securities Act of 1933, as amended, in respect of the Common Stock issued and issuable upon conversion of this Note and upon exercise of the Warrants issued pursuant to the Loan Agreement, such that all such shares of Common Stock will be freely tradable immediately upon issuance at such time, (iv) the Maker is current in all of its required filings with the Securities and Exchange Commission, (v) the reported Trading Price (as hereinafter defined) of the Common Stock for each of the twenty (20) consecutive trading days immediately prior thereto has been equal to or greater than 165150% of the Conversion Price in effect on each such trading day, and (vi) the average daily trading volume of the Common Stock as reported by the principal exchange or trading medium on which the Common Stock is listed or quoted has been equal to or greater than 100,000 shares (such number to be subject to adjustment on a proportionate basis in the event of each and every stock split, stock dividend, combination of shares, recapitalization or other such event respecting the Common Stock which may occur subsequent to the date hereof) during the three (3) months immediately prior thereto, then the Maker may, upon five (5) business days’ prior written notice to the Payee, require the Payee to convert all or any portion of the Principal of this Note into shares of Common Stock at the Conversion Price then in effect; and in the event of any such conversion at the option of the Maker, the Maker shall give written notice thereof to the Payee certifying as to the satisfaction of the foregoing conditions (including a detailed schedule of Trading Prices and volumes for purposes of the foregoing clauses (v) and (vi)), and shall pay to the Payee, simultaneously with the delivery of stock certificates in accordance with Section 3(c), all unpaid accrued Interest on the Principal amount so converted. As used herein, the term “Trading Price” on any relevant date means the closing sale price (or, if no closing sale price is reported, the last reported sale price) of the Common Stock (regular way). The effective date of any conversion hereunder is herein referred to as the “Conversion Date.” To the extent that this Note is converted only in part, then such conversion shall be treated as a prepayment of the Principal amount converted in accordance with Section 2(d) above, provided that no prepayment premium shall be required in respect of any conversion.