After the Mandatory Conversion Date Clause Samples
The "After the Mandatory Conversion Date" clause defines the rights and obligations of the parties once a specified conversion event has occurred, typically involving the automatic conversion of convertible securities into equity. In practice, this clause outlines what happens to any remaining convertible notes or similar instruments after the mandatory conversion date, such as the extinguishment of debt or the issuance of shares to noteholders. Its core function is to ensure clarity and finality regarding the status of outstanding instruments, preventing disputes or confusion about the parties' rights after the conversion event.
After the Mandatory Conversion Date. In the event of a Liquidation, after the Mandatory Conversion Date, for so long as any shares of Series 1 Preferred Stock shall be outstanding, the holders of shares of Series 1 Preferred Stock then outstanding shall be entitled to participate with the holders of shares of Liquidation Junior Stock then outstanding, pro rata as a single class based on the number of outstanding shares of Liquidation Junior Stock on an as-converted into Common Stock basis held by each holder as of immediately prior to the Liquidation, in the distribution of all the remaining Liquidation Proceeds available for distribution to its stockholders.
After the Mandatory Conversion Date. After the Mandatory Conversion Date and for so long as any shares of Series 1 Preferred Stock shall be outstanding, subject to applicable law and the rights of the holders of any outstanding shares of Dividend Senior Stock, the holders of outstanding shares of Series 1 Preferred Stock shall be entitled to receive dividends, when, as and if declared by the Board of Directors on the then outstanding shares of Dividend Parity Stock, on a pari passu basis with the holders of the then outstanding shares of Dividend Parity Stock and in preference and prior to the holders of any then outstanding shares of Dividend Junior Stock, in an amount per then outstanding share of Series 1 Preferred Stock determined by multiplying (i) the dividend amount per then outstanding share of Common Stock being declared by (ii) the Conversion Rate, with each share of Series 1 Preferred Stock receiving such dividend on an as converted to Common Stock basis (without regard to any limitation or restriction on such conversion); provided, that no dividend shall be declared and paid or set apart for payment on the then outstanding shares of Common Stock unless a dividend shall also be declared and paid or set apart for payment on the then outstanding shares of Series 1 Preferred Stock. Notwithstanding the foregoing, to the extent that the right of a holder of Series 1 Preferred Stock to receive a dividend consisting of shares of Common Stock or Common Stock Equivalents would result in such holder and such holder’s Attribution Parties exceeding such holder’s Beneficial Ownership Limitation, then such holder shall, to the fullest extent permitted by applicable law, not be entitled to receive such dividend to the extent of such Beneficial Ownership Limitation (and shall not be entitled to Beneficially Own such shares of Common Stock or Common Stock Equivalents as a result of such dividend to the extent of any such excess) and such dividend to such extent shall be held in abeyance for the benefit of such holder until such time or times, if ever, as such holder’s right thereto would not result in such holder and such holder’s Attribution Parties exceeding such holder’s Beneficial Ownership Limitation, at which time or times such dividend (and any dividend consisting of Common Stock or Common Stock Equivalents declared on such initial dividend or on any subsequent dividend held similarly in abeyance to the same extent as if there had been no such limitation) shall be paid to such holder.