Common use of Series B Preferred Clause in Contracts

Series B Preferred. Effective upon the closing of the Company's Series B Preferred Stock Financing (the "Series B Financing"), the Company shall issue to Connetics shares of Series B Preferred Stock (the "Series B Preferred") in an amount equal to the quotient of five hundred thousand dollars ($500,000) divided by the price per share of Series B Preferred paid by the purchasers of the Series B Preferred. The Company shall use its best efforts to assure that the terms, conditions, rights, preferences and privileges of the Series B Preferred issued to Connetics by the Company in the Series B Financing shall be the same as those of the Series B Preferred issued to the other purchasers, provided however, that such efforts shall not require the Company to accept a lower price per share or make other material concessions to the other purchasers of the Series B Preferred. Notwithstanding the foregoing, in the event of either a Company Sale (as defined below) or a firm underwritten public offering of the Company's Common Stock either of which occurs prior to a Series B Financing, the Company shall, in its sole discretion, either (i) deliver to Connetics five hundred thousand dollars ($500,000) by check or wire transfer or (ii) issue to Connetics four hundred thousand (400,000) shares of Series A-2 Preferred Stock concurrently with the closing of such Company Sale or public offering.