Maximum Conversion Shares. The definition of "Maximum Conversion Shares" set forth in the Loan Agreement is hereby deleted and replaced with the following definition which shall be applicable to both the Loan Agreement and this Amendment. "Maximum Conversion Shares" means, after an Acceleration Event in which the Lender shall accelerate payment of the aggregate Outstanding Principal Amount of the Notes following the occurrence of any Event of Default (as defined in the Notes) which shall not be timely cured by the Loan
... Parties (a) the Outstanding Principal Amount of the Initial Note shall automatically increase by 110% (a maximum of $7,287,500), shall accrue interest on such Outstanding Principal Amount at the rate of 19% per annum, and (b) the Outstanding Principal Amount of the Additional Note shall automatically increase by 110% (a maximum of $3,267,000), shall accrue interest on such Outstanding Principal Amount at the rate of 19% per annum (collectively the "Default Amount"), and upon the request of the Lender, all or any portion of such Default Amount may be converted by the Lender into that number of shares of Company Common Stock as shall be determined by (a) dividing 200% of the then increased Outstanding Principal Amount of the Notes by (b) the Event of Default Conversion Price then in effect; provided that, (i) notwithstanding the election of the Lender to convert all or any part of the then Outstanding Principal Amount of the Note, the Company shall have the right to pay in cash the entire then Outstanding Principal Amount of all Note being converted following Lender's notice of its election to convert the Note and prior to any such conversion, and (ii) unless Stockholder Approval has been obtained, the maximum number of shares of Common Stock of the Company that may be issued pursuant to any such permitted conversion of the Note (calculated on a fully-diluted basis) shall not be greater than 19.9% of the number of shares of Common Stock of the Company then issued and outstanding (calculated on a non-diluted basis).
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