Common use of Special Mandatory Conversion Clause in Contracts

Special Mandatory Conversion. (i) If a holder of Series A Preferred fails to purchase all or a portion of its Pro Rata Amount (as defined below) of the shares of Common Stock required to be purchased by such holder at the Common Equity Closing pursuant to the Purchase Agreement (the “Common Equity Closing”), then the Applicable Portion (as defined below) of the shares of Series A Preferred Stock held by such holder shall be automatically, without any further action on the part of the Company or such holder, converted into shares of Common Stock at an adjusted Series A Preferred Conversion Rate equal to one (1), subject to any adjustments that may have been made under Sections 4(e) through 4(i) hereof between the issuance of the Series A Preferred and the Common Equity Closing. Such conversion is referred to as a “Special Mandatory Conversion.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A Preferred converted pursuant to Section 4(m)(i) shall be sent written notice of such Special Mandatory Conversion. Such shares of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series A Preferred. Thereupon, there shall be issued and delivered to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series A Preferred surrendered were convertible pursuant to Section 4(m)(i) above.

Special Mandatory Conversion. Each Purchaser acknowledges and agrees that if a Purchaser holds, at the time of delivery of the Issuance Notice (as defined in the Restated Certificate), an aggregate of at least 60,000 shares of the Company’s Series C-1 Preferred Stock (the “Series C-1 Preferred”) or Series C-2 Preferred Stock (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like) and fails to purchase (a) in the Initial Closing or the Subsequent Closing, and (b) the Second Closing, if any, a Note in the principal amount set forth on Exhibit A under “Initial Closing Note Amount” or “Subsequent Closing Note Amount” and “Second Closing Note Amount,” as applicable, then (i) If a holder of Series A Preferred fails to purchase all or a portion of its Pro Rata Amount (as defined below) one-half of the shares of Common Stock required to be purchased by such holder at the Common Equity Closing pursuant to the Purchase Agreement (the “Common Equity Closing”), then the Applicable Portion (as defined below) of the total shares of Series A C-1 Preferred Stock and Series C-2 Preferred then-held by such holder Purchaser shall automatically be automatically, without any further action on the part of the Company or such holder, converted into shares of the Company’s Common Stock at an adjusted in accordance with Article IV.G.5(p) of the Restated Certificate and (ii) to the extent that the Series A C-1 Preferred Conversion Rate equal Price (as defined in the Restated Certificate) or Series C-2 Conversion Price (as defined in the Restated Certificate) has been adjusted pursuant to one a previously Qualifying Dilutive Issuance (1), subject to any adjustments that may have been made under Sections 4(eas defined in the Restated Certificate) through 4(i) hereof between the issuance conversion of the Series A C-1 Preferred and/or Series C-2 Preferred, as applicable, shall apply as if no such previous adjustment(s) had been applied to the Series C-1 Conversion Price or Series C-2 Conversion Price, and (iii) all rights with respect to the Common Equity Closing. Such conversion is referred to as a “Special Mandatory Conversion.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A C-1 Preferred and/or Series C-2 Preferred converted pursuant to Section 4(m)(iArticle IV.G.5(p) shall be sent written notice of the Restated Certificate will terminate at the time of such Special Mandatory Conversion. Such shares conversion (notwithstanding the failure of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory holders thereof to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing for such shares at on or prior to such time), except only the office rights of the Company or any transfer agent for holders thereof, upon surrender of the Series A Preferred. Thereupon, there shall be issued and delivered to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificatescertificates therefor, to receive a certificate or certificates for the number of full shares of Common Stock into which the issuable on such conversion. Any person or entity to whom shares of Series A C-1 Preferred surrendered were convertible pursuant and/or Series C-2 Preferred are transferred by a Purchaser, whether voluntarily or by operation of law, shall be bound by this Section 5.10, and such shares shall remain subject to Section 4(m)(i) abovethe conversion provisions hereunder and under the Restated Certificate, as may be amended from time to time, until such time as all Notes that the transferring Purchaser was required to purchase at the Closings are purchased. In addition, in the event that a Purchaser fails to purchase Notes in the principal amount allocated to it in the Initial Closing or Second Closing such Notes shall be made available for the Purchasers who participate in such Closing to purchase on a pro rata basis (based on the principal amount of the Notes such participating Investors have purchased in the Initial Closing or Second Closing, as applicable).

Special Mandatory Conversion. 56 (i) If a holder At any time following the Purchase Date, if (a) the holders of shares of Series A Preferred fails Stock, Series B Preferred Stock or Series C Preferred Stock are entitled to purchase all exercise the right of first refusal (the "Right of First Refusal") set forth in Section 2.3 of the Investors' Rights Agreement dated on or about August 17, 1995, by and between this corporation and certain investors, as amended from time to time (the "Rights Agreement"), with respect to an equity financing of the corporation in an aggregate amount of at least $500,000 (the "Equity Financing"), (b) this corporation has complied with its notice obligations, or such obligations have been waived, under the Right of First Refusal with respect to such Equity Financing and this corporation thereafter proceeds to consummate the Equity Financing and (c) such holder, including such holder's affiliates (collectively, a portion "Non-Participating Holder") does not by exercise of such holder's Right of First Refusal acquire his, her or its Pro Rata Amount Share (as defined below) in Section 2.3 of the Rights Agreement) offered in such Equity Financing (a "Mandatory Offering"), then all of such Non-Participating Holder's shares of Common Series A Preferred Stock, Series B Preferred Stock required to be purchased by and/or Series C Preferred Stock shall automatically and without further action on the part of such holder at be converted effective upon, subject to, and immediately prior to, the Common consummation of the Mandatory Offering (the "Mandatory Offering Date") into an equivalent number of shares of Series A-1 Preferred Stock, Series B-1 Preferred Stock and Series C-1 Preferred Stock, respectively ("Special Mandatory Conversion"); provided, however, that no such conversion shall occur in connection with a particular Equity Closing Financing if, pursuant to the Purchase Agreement (written request of the “Common Board of Directors and subject to the approval of the holders of a majority of the outstanding Preferred Stock, such holder agrees in writing to waive his, her or its Right of First Refusal with respect to such Equity Closing”Financing. Upon conversion pursuant to this subsection 4(m)(i), then the Applicable Portion (as defined below) of the shares of Series A Preferred Stock, Series B Preferred Stock held by such holder and/or Series C Preferred Stock so converted shall be automatically, without any further action on the part of the Company or such holder, converted into shares of Common Stock at an adjusted Series A Preferred Conversion Rate equal to one (1), cancelled and not subject to any adjustments that may have been made under Sections 4(e) through 4(i) hereof between the issuance of the Series A Preferred and the Common Equity Closing. Such conversion is referred to as a “Special Mandatory Conversionreissuance.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A Preferred converted pursuant to Section 4(m)(i) shall be sent written notice of such Special Mandatory Conversion. Such shares of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series A Preferred. Thereupon, there shall be issued and delivered to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series A Preferred surrendered were convertible pursuant to Section 4(m)(i) above.

Special Mandatory Conversion. (i) If a holder of Series A Preferred fails to purchase all or a portion of its Pro Rata Amount (as defined below) of the shares of Common Stock required to be purchased by such holder at the Common Equity Closing pursuant to the Purchase Agreement (the “Common Equity Closing”), then the Applicable Portion (as defined below) of the shares of Series A Preferred Stock held by such holder shall be automatically, without any further action on the part of the Company or such holder, converted into shares of Common Stock at an adjusted Series A Preferred Conversion Rate equal to one (1), subject to any adjustments that may have been made under Sections 4(e) through 4(i) hereof between the issuance of the Series A Preferred and the Common Equity Closing. Such conversion is referred to as a “Special Mandatory Conversion.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.” (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A Preferred converted pursuant to Section 4(m)(i) shall be sent written notice of such Special Mandatory Conversion. Such shares of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series A Preferred. Thereupon, there shall be issued and delivered to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series A Preferred surrendered were convertible pursuant to Section 4(m)(i) above.

Special Mandatory Conversion. (i) If a At any time following the Original Issue Date, in the event that any holder of Series A C Preferred fails to Units does not purchase all or a portion at the Second Tranche Closing, at least that number of its Pro Rata Amount (as defined below) of the shares of Common Stock required Series C Preferred Units designated to be purchased by such holder at the Common Equity Closing (a “Non-Participating Purchaser”) pursuant to Section 2.4 of Purchase Agreement, to the extent required by such terms of the Purchase Agreement and by the date that is fifteen (15) days following delivery of of the “Common Equity Closing”Second Tranche Closing Notice (as defined in the Purchase Agreement), then the Applicable Portion (as defined below) of the shares of each Series A C Preferred Stock Unit held by such holder Non-Participating Purchaser shall be automatically, and without any further action on the part of such holder or the Company or such holderCompany, be converted into shares one-tenth (1/10th) of Common Stock at an adjusted Series A Preferred Conversion Rate equal to one (1) Common Unit (the “Special Mandatory Conversion Rate”), effective upon, subject to any adjustments that may have been made under Sections 4(e) through 4(i) hereof between to, and concurrently with, the issuance date of the Second Tranche Closing (or the date that the Second Tranche Closing was set forth to be in the Second Tranche Closing Notice, if it is not actually consummated). For purposes of determining the number of Series A C Preferred Units owned by a holder, and for determining the Common Equity number of Series C Preferred Units a holder of Series C Preferred Units has purchased in the Second Tranche Closing, all Series C Preferred Units held by Affiliates of such holder shall be aggregated with such holder’s Series C Preferred Units and all Series C Preferred Units purchased by Affiliates of such holder shall be aggregated with the Series C Preferred Units purchased by such holder (provided that no securities shall be attributed to more than one entity or person within any such group of Affiliated entities or persons). Such conversion is referred to as a “Special Mandatory Conversion.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENTNotwithstanding anything to the contrary herein or in the Purchase Agreement, MARKED BY BRACKETSthe Series C Preferred Majority may elect, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A Preferred converted pursuant to Section 4(m)(i) shall be sent by written notice of such Special Mandatory Conversion. Such shares of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered sent to the Company or its transfer agent; provided, howeverat least five (5) business days prior to the consummation of the Second Tranche Closing (as defined in the Purchase Agreement), that the Company this Section B12 shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series A Preferred. Thereupon, there shall be issued and delivered apply to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series A Preferred surrendered were convertible pursuant to Section 4(m)(i) aboveclosing.

Special Mandatory Conversion. Each Purchaser acknowledges and agrees that if a Purchaser holds, at the time of delivery of the Issuance Notice (as defined in the Restated Certificate), an aggregate of at least 60,000 shares of the Company’s Series C-1 Preferred Stock (the “Series C-1 Preferred”) or the Company’s Series C-2 Preferred Stock (the “Series C-2 Preferred”) (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like) and fails to purchase (a) in the Initial Closing and (b) the Second Closing, if any, a Note in the principal amount set forth on Exhibit A under “Initial Closing Note Amount” and “Second Closing Note Amount,” as applicable, then (i) If a holder of Series A Preferred fails to purchase all or a portion of its Pro Rata Amount (as defined below) of the shares of Common Stock required to be purchased by such holder at the Common Equity Closing pursuant to the Purchase Agreement (the “Common Equity Closing”), then the Applicable Portion (as defined below) of the total shares of Series A C-1 Preferred Stock and Series C-2 Preferred then-held by such holder Purchaser shall automatically be automatically, without any further action on the part of the Company or such holder, converted into shares of the Company’s Common Stock at an adjusted on a 10-for-1 basis in accordance with Article IV.D.5(p) of the Restated Certificate and (ii) to the extent that the Series A C-1 Preferred Conversion Rate equal Price (as defined in the Restated Certificate) or Series C-2 Conversion Price (as defined in the Restated Certificate) has been adjusted pursuant to one a previously Qualifying Dilutive Issuance (1), subject to any adjustments that may have been made under Sections 4(eas defined in the Restated Certificate) through 4(i) hereof between the issuance conversion of the Series A C-1 Preferred and/or Series C-2 Preferred, as applicable, shall apply as if no such previous adjustment(s) had been applied to the Series C-1 Conversion Price or Series C-2 Conversion Price, and (iii) all rights with respect to the Common Equity Closing. Such conversion is referred to as a “Special Mandatory Conversion.” [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (ii) Upon a Special Mandatory Conversion, each holder of shares of Series A C-1 Preferred and/or Series C-2 Preferred converted pursuant to Section 4(m)(iArticle IV.D.5(p) shall be sent written notice of the Restated Certificate will terminate at the time of such Special Mandatory Conversion. Such shares conversion (notwithstanding the failure of Series A Preferred shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series A Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement reasonably satisfactory holders thereof to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Upon the occurrence of such automatic conversion of the Series A Preferred, the holders of Series A Preferred shall surrender the certificates representing for such shares at on or prior to such time), except only the office rights of the Company or any transfer agent for holders thereof, upon surrender of the Series A Preferred. Thereupon, there shall be issued and delivered to such holder promptly (which shall be no later than three (3) business days) at such office and in its name as shown on such surrendered certificate or certificatescertificates therefor, to receive a certificate or certificates for the number of full shares of Common Stock into which the issuable on such conversion. Any person or entity to whom shares of Series A C-1 Preferred surrendered were convertible pursuant and/or Series C-2 Preferred are transferred by a Purchaser, whether voluntarily or by operation of law, shall be bound by this Section 5.10, and such shares shall remain subject to Section 4(m)(i) abovethe conversion provisions hereunder and under the Restated Certificate, as may be amended from time to time, until such time as all Notes that the transferring Purchaser was required to purchase at the Closings are purchased. In addition, in the event that a Purchaser fails to purchase Notes in the principal amount allocated to it in the Initial Closing or Second Closing such Notes shall be made available for the Purchasers who participate in such Closing to purchase on a pro rata basis (based on the principal amount of the Notes such participating Investors have purchased in the Initial Closing or Second Closing, as applicable).