From: ehbarak Sent: Thursday, August 11, 2016 2:47 PM To: Jeffrey E. Subject: Re: I'll call in an hour. Best EB =ent from my iPhone On 11 Aug 2016, at 17:08, jeffrey E. «= href="[email protected]">[email protected]> wrote:=br> 505-938-2929 On Thursday= August 11, 2016 > wrote: The automatic conversion of the preferred share that was initially stated in the term sheet to occur upon a qualified IPO of no less than $50 MM in gross proceeds that nets $10MM of proceeds, now will not occur unless there is a qualified IPO of $80MM gross proceeds that nets $20MM of proceeds. 3.=The 6% liquidation preference per share that was initially stated in the term sheet to terminate once the preferred holders received distributions of 2 times the purchase price for their shares, no will not terminate until the preferred holders receive 3.5 times the purchase price for their shares. 4. The bring along rights that in the term sheet were initially effective only upon 60% shareholder approval of a transaction with a pre-money valuation of not less than $50MM, now may be imposed even if the pre- money valuation is less than $50MM as long as there is 75% shareholder approval. That is to say, bring along rights are imposed i= if there is 60% shareholder approval of a transaction with a pre-money valuation of not less then $50MM or if there is 75% shareholder approval of a transaction with a pre-money valuation of less than $50MM. <=r> Because there is missing information, I cannot give you a full=summary of the deal as currently drafted. For example: =div>l understand from the email we previously received that transmitted the signed term sheet to us that there were certain changes to be made to the warrants. Specifically, the 25% increase in the exercise price of =the warrants was not to take effect unless either the first warrant for $1,500,000 was exercised by us or there was a subsequent round of equity financing of at least $1MM where the pu