2.4 Repayment from Proceeds. While any portion of this Note is outstanding, if the Borrower receives cash proceeds from any source or series of related or unrelated sources, including but not limited to, from payments from customers, the issuance of equity or debt, the conversion of outstanding warrants of the Borrower, the issuance of securities pursuant to an equity line of credit of the Borrower or the sale of assets, the Borrower shall, within one (1) business day of Borrower’s receipt of such proceeds, inform the Holder of such receipt, following which the Holder shall have the right in its sole discretion to require the Borrower to immediately apply up to 50% of such proceeds to repay all or any portion of the outstanding amounts owed under this Note. Failure of the Borrower to comply with this provision shall constitute an Event of Default. The foregoing repayment requirement in this Section shall not be applicable to (a) sales of products by Borrower or (b) securities offering transactions after the Execution Date yielding in the aggregate less than $2,000,000 gross proceeds to the Borrower; provided, that for an offering transaction that causes such cumulative gross proceeds to exceed $2,000,000, the partial repayment obligation in this Section shall apply only to the excess amount of proceeds. In the event that such excess proceeds are received by the Holder prior to the Maturity Date, the required prepayment shall be subject to the terms of Section 4.14 herein.