Upon a liquidation event, the Investor gets its liquidation preference and then shares in the liquidation proceeds on an as-converted basis until a certain multiple of the original purchase price is reached. Once the return is greater than the cap, the participation stops.
Term Sheet Language: After the payment of the Liquidation Preference to the holders of Series [_] Preferred, the remaining assets shall be distributed ratably to the holders of the Common Stock and the Series [_] Preferred on a common equivalent basis, provided that holders of Series [_] Preferred will stop participating once they have received a total liquidation amount per share equal to [X] times the Original Purchase Price, plus any declared but unpaid dividends. Thereafter, the remaining assets shall be distributed ratably to the holders of the Common Stock.