Definitions

1. "{Conversion_Shares}" shall mean:
   1. with respect to a conversion pursuant to {Conversion.Equity.Xref}, shares of {Preferred_Stock} issued in the {Next_Equity_Financing}; provided, however, that, at {the_Company}'s election, "{Conversion_Shares}" with respect to a conversion pursuant to {Conversion.Equity.Xref} shall mean shares of a {Shadow_Series};
   2. with respect to a conversion pursuant to {Conversion.Corporate.Xref}, shares of {Common_Stock}; and
   3. with respect to a conversion pursuant to {Conversion.Maturity.Xref}, shares of a newly created series of {the_Company}'s {Series_Seed_Preferred_Stock}, upon the terms and provisions set forth in the most recent version of the Series Seed documents posted at www.seriesseed.com (or if not so posted, as reasonably agreed by {the_Company} and a {Majority_in_Interest}); provided that, for the avoidance of doubt, the {Conversion_Price} shall be determined pursuant to {Def.Xref}.2.3).
2. "{Conversion_Price}" shall equal:
   1. with respect to a conversion pursuant to {Conversion.Equity.Xref}, the lower of (A) the product of (1) one (1) minus the {Discount} and (2) the price paid per share for {Preferred_Stock} by the investors in the {Next_Equity_Financing} or (B) the quotient resulting from dividing (1) the Valuation Cap by (2) the {Fully-Diluted_Capitalization} immediately prior to the closing of the {Next_Equity_Financing};
   2. with respect to a conversion pursuant to {Conversion.Corporate.Xref}, the quotient resulting from dividing (A) the Valuation Cap by (B) the {Fully-Diluted_Capitalization} immediately prior to the closing of the {Corporate_Transaction}; and
   3. with respect to a conversion pursuant to {Conversion.Maturity.Xref}, the quotient resulting from dividing (A) the Valuation Cap by (B) the {Fully-Diluted_Capitalization} immediately prior to the conversion.
3. "{Corporate_Transaction}" shall mean:
   1. the closing of the sale, transfer or other disposition of all or substantially all of {the_Company}'s assets,
   2. the consummation of the merger or consolidation of {the_Company} with or into another entity (except a merger or consolidation in which the holders of capital stock of {the_Company} immediately prior to such merger or consolidation continue to hold at least 50% of the voting power of the capital stock of {the_Company} or the surviving or acquiring entity),
   3. the closing of the transfer (whether by merger, consolidation or otherwise), in one transaction or a series of related transactions, to a person or group of affiliated persons (other than an underwriter of {the_Company}'s securities), of {the_Company}'s securities if, after such closing, such person or group of affiliated persons would hold 50% or more of the outstanding voting stock of {the_Company} (or the surviving or acquiring entity), or
   4. the liquidation, dissolution or winding up of {the_Company};
   provided, however, that a transaction shall not constitute a {Corporate_Transaction} if its sole purpose is to change the state of {the_Company}'s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held {the_Company}'s securities immediately prior to such transaction. Notwithstanding the prior sentence, the sale of shares of {Preferred_Stock} in a bona fide financing transaction shall not be deemed a "{Corporate_Transaction}."
4. "{Corporate_Transaction_Payment}" shall mean an amount equal to all accrued and unpaid interest due on this {KISS} plus two times (2X) the {Purchase_Price}.
5. "{Discount}" shall mean {Discount.%}.
6. "{Equity_Securities}" shall mean {the_Company}'s Common Stock ("{Common_Stock}") or {the_Company}'s Preferred Stock ("{Preferred_Stock}") or any securities conferring the right to purchase {the_Common_Stock_or_Preferred_Stock} or securities convertible into, or exchangeable for (with or without additional consideration), {the_Common_Stock_or_Preferred_Stock}, except any security granted, issued and/or sold by {the_Company} to any director, officer, employee or consultant of {the_Company} in such capacity for the primary purpose of soliciting or retaining their services.
7. "{Financial_Statements}" shall mean an income statement, balance sheet, statement of stockholder's equity, and/or a statement of cash flows, in each case as of the end of (i) each of the first three (3) fiscal quarters and (ii) each fiscal year of {the_Company}.
8. "{Fully-Diluted_Capitalization}" shall mean the number of shares of outstanding {Common_Stock} on a fully-diluted basis, including (i) conversion or exercise of all securities convertible into or exercisable for {Common_Stock}, (ii) exercise of all outstanding options and warrants to purchase {Common_Stock} and, in the case of {Def.Xref}.2.1 and {Def.Xref}.2.3 only, (iii) the shares reserved or authorized for issuance under {the_Company}'s existing stock option plan or any stock option plan created or increased in connection with such transaction; but excluding, for this purpose, the conversion contemplated by the applicable provision of {Conversion.Xref}.
9. "{Holder}" shall mean a member of the {KISS_Group} that holds a {KISS} (including, without limitation, {the_Investor}, for so long as {the_Investor} holds this {KISS}).
10. "{Interest_Rate}" shall mean a rate of four percent (4%) per annum, compounded annually.
11. "{KISS}" or "{KISSes}" shall mean the {KISS} instruments issued by {the_Company} to {Holders} in the form hereof.
12. "{KISS_Group}" shall mean the holders of all {KISSes} in the {Series}, collectively.
13. "{Majority_in_Interest}" shall mean members of the {KISS_Group} holding a majority in interest of the aggregate {Purchase_Prices} of all {KISSes} in the {Series}.
14. "{Maturity_Date}" shall mean the date that is eighteen (18) months following the {Date_of_Issuance}.
15. "{Next_Equity_Financing}" shall mean the next sale (or series of related sales) by {the_Company} of its {Preferred_Stock} following the {Date_of_Issuance} from which {the_Company} receives gross proceeds of not less than $1,000,000 (excluding the aggregate amount of securities converted into {Preferred_Stock} in connection with such sale (or series of related sales)).
16. "{Participation_Amount}" shall mean an amount in US dollars equal to one times (1X) the {Purchase_Price}.
17. "{Shadow_Series}" shall mean shares of a series of {Preferred_Stock} that is identical in all respects to the shares of {Preferred_Stock} issued in the {Next_Equity_Financing} (e.g., if {the_Company} sells {Series_A_Preferred_Stock} in the {Next_Equity_Financing}, the {Shadow_Series} would be Series A-1 Preferred Stock), except that the liquidation preference per share of the {Shadow_Series} shall equal the {Conversion_Price} (as determined pursuant to {Def.Xref}.2.1), with corresponding adjustments to any price-based antidilution and dividend rights provisions.
18. "{Valuation_Cap}" shall mean {ValuationCap.$}