Common use of Class B Preferred Stock Clause in Contracts

Class B Preferred Stock. Upon the occurrence of an Event of Default and the subsequent payment of the Mandatory Default Amount, each share of Class B Preferred Stock shall immediately be cancelled and be of no further force or effect. In addition, in the event that such Event of Default shall occur prior to the date that shall be two (2) years from the Closing Date and results in the foreclosure of the Intellectual Property (as such term is defined in the Security Agreement), then (i) if any portion of the shares of Class B Preferred Stock shall have been converted into Conversion Shares, then such Conversion Shares shall immediately be cancelled and be of no further force or effect, or (ii) if any Conversion Shares shall have been sold, then the Majority Shareholder shall within two (2) days return to the Corporation all proceeds derived from such sale.