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This excerpt taken from the WBMD 8-K filed Nov 21, 2006. Automatic
Conversion
Each share of Class A and B preferred is automatically
converted into shares of common stock at the Class A or
Class B conversion price at the time in effect for such
shares immediately upon the earlier of the closing of
(i) the Company’s sale of its common stock in an
underwritten public offering yielding net proceeds in excess of
$25,000,000 at a price per share of at least $10.50 (as adjusted
for any stock splits, stock dividends, combinations,
recapitalizations or the like) (a “Qualified
Offering”) and (ii) the date specified upon the
election to convert all Class A and B preferred into common
stock by holders of at least a majority of the outstanding
shares of Class A or B preferred, voting on an as-converted
basis.
Immediately upon the closing of the Company’s Qualified
Offering, if the holders of the Company’s Class C
preferred have not previously redeemed their shares, each share
of Class C preferred shall automatically be converted into
(i) shares of common stock at the Conversion Price at the
time in effect for such shares of Class C preferred, and
(ii) the Class C Preferential Amount which amount
shall be payable in cash, or upon the consummation of the
Company’s initial public offering, the Company may, in its
sole discretion, choose to pay the Class C Preferential
Amount in an additional number of shares of common stock with an
aggregate value equal to the Class C Preferential Amount.
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