2. Limitations on Transfer. Until immediately prior to the consummation of a Qualifying IPO, the Investor shall not directly or indirectly sell, convey, dispose of or transfer, without the Companys prior written consent (such consent not to be unreasonably withheld with respect to any proposed sale, conveyance, disposition or transfer to a transferee who is neither a competitor of the Company nor an individual or institutional investor that is or holds itself out as an activist investor), either in a single transaction or in a series of transactions, any Shares or any right or interest therein then owned by the Investor except (1) to a Permitted Transferee (a Permitted Transfer), (2) pursuant to and in accordance with the terms of a Deemed Liquidation Event, (3) pursuant to a Mandatory Redemption, or (4) pursuant to an Optional Redemption. The term Permitted Transferee means (i) any person or entity set forth on Schedule I, any family members of a natural person set forth on Schedule I, or any affiliate of the foregoing, (ii) any person or entity that is managed by a person or entity referred to in clause (i), or (iii) any person or entity that is a not-for-profit entity established by a natural person set forth on Schedule I or any family member of a natural person set forth on Schedule I. Prior to each such Permitted Transfer, (x) the Investor shall provide at least five (5) business days advance notice to the Company, (y) such Permitted Transferee shall agree in writing to be bound by the obligations imposed upon the Investor under this letter agreement, as if such Permitted Transferee were originally a signatory to this letter agreement in the capacity of the Investor and (z) such Permitted Transferee shall duly execute a lock-up agreement in the form of Exhibit A in favor of the managing underwriters in a Qualifying IPO. In the event that prior to a Qualifying IPO, the Investor proposes to directly or indirectly sell, convey, dispose of or transfer any portion of its Shares or any right or interest therein, whether voluntarily or involuntarily, other than pursuant to a Permitted Transfer, then, prior to any proposed sale, conveyance, disposition, or transfer, the Investor shall submit a written request to the Company (the Transfer Request) of its desire to effect such transaction. The Transfer Request shall include (a) the Investors bona fide intention to offer such Shares or any right or interest therein, (b) the number of Shares or any right or interest therein proposed to be sold by the Investor, (c) the principal terms of such proposed sale, conveyance, disposition, or transfer, including the cash or other property or consideration to be received upon such proposed transaction for each Share or any right or interest therein, (d) a joinder to this letter agreement, in a form reasonably satisfactory to the Company, executed by the proposed transferee, wherein such proposed transferee agrees to be bound to the same extent as the Investor under this Section 2 and Section 4 hereof and (e) a lock-up agreement in the form of Exhibit A in favor of the managing underwriters in a Qualifying IPO duly executed by such proposed transferee; provided that any such transaction effectuated without the Companys prior written consent in accordance with this Section 2 shall be null and void ab initio, and of no force or effect.
3. Preemptive Rights. Subject to the terms and conditions specified in this Section 3 and applicable securities laws, the Company hereby grants to the Investor a preemptive right with respect to future sales by the Company of any shares of its capital stock, or other securities, that are convertible into or exercisable for any capital stock of the Company (collectively, Company Securities). The Investor shall have the right to assign the preemptive rights hereby granted to it, in whole or in part, to any of its affiliates that has agreed in writing to be bound by the obligations imposed upon the Investor in this letter agreement, as if such affiliate were originally a signatory to this letter agreement in the capacity of the Investor. Each time the Company proposes to issue or sell any Company Securities (a Company Offering), the Company shall permit the Investor to exercise its preemptive rights in accordance with the following provisions:
(a) The Company shall deliver written notice (the Sale Notice) to the Investor stating (i) the class, series and number of Company Securities proposed to be sold by the Company, (ii) the proposed price and terms upon which it is selling such Company Securities and (iii) the Companys determination of the number of shares of Company Securities which may be purchased by the Investor if it chooses to exercise its rights under this Section 3.