Common use of Right of First Option Clause in Contracts

Right of First Option. (a) (a) The Company hereby grants to each Holder the right of first option to purchase its pro rata share of New Securities (as defined in Section 4.1(c)) which the Company may, from time to time, propose to sell and issue after the date of this Agreement, subject to Sections 4.1(b)-(e). A Holder’s pro rata share, for purposes of this right of first option, is equal to the ratio of (a) the number of shares of Common Stock owned by such Holder immediately prior to the issuance of New Securities (assuming full conversion of the Shares and full conversion or exercise of all outstanding convertible securities, rights, options and warrants held by said Holder) to (b) the total number of shares of Common Stock outstanding immediately prior to the issuance of New Securities (assuming full conversion of the Shares and full conversion or exercise of all outstanding convertible securities, rights, options and warrants). Each Holder (including CL Alaska) shall have a right of over-allotment such that if any Holder fails to exercise its rights hereunder to purchase its pro rata share of New Securities, the other Holders may purchase the non-purchasing Holder’s portion on a pro rata basis.