Major Transaction Conversion Sample Clauses
The Major Transaction Conversion clause defines the process by which certain securities, such as convertible notes or preferred shares, are automatically converted into common stock upon the occurrence of a significant corporate event, like a merger, acquisition, or sale of substantially all assets. Typically, this clause outlines the specific triggers that constitute a 'major transaction' and details the conversion ratio or terms that will apply. Its core practical function is to ensure that investors are treated equitably and can participate in the upside or liquidity event, preventing them from being left out or disadvantaged during major changes in company ownership or structure.
POPULAR SAMPLE Copied 1 times
Major Transaction Conversion. In the event that a Major Transaction occurs, then (1) in the case of a transaction covered by the provisions of clause (A) of the definition of “Major Transaction”, in which the Common Shares of the Company are converted into the right to receive cash, securities of another entity and/or other assets (a “Successor Major Transaction”), the Holder, at its option, may convert, in whole or in part, the outstanding principal amount under this Note into the right to receive upon consummation of the Major Transaction, the amount of cash and other assets and the number of securities or other property of the Successor Entity or other entity that the Holder would have received had such Holder converted the Major Transaction Conversion Amount (as defined below) into Base Conversion Shares and Additional Conversion Shares (as defined below and without regard to the 9.985% Cap) immediately prior to the consummation of such Major Transaction (the “Successor Consideration”) and (2) in the case of any other Major Transactions not covered under clause (1) above (a “Company Share Major Transaction”), the Holder shall have the right to convert, in whole or in part, and from time to time, the outstanding principal amount under this Note into Base Conversion Shares and Additional Conversion Shares (“Major Transaction Company Shares”).
Major Transaction Conversion. Each Holder may elect a Major Transaction Conversion as follows: (1) in the case of a Successor Major Transaction, each Holder, at its option, may elect to convert, in whole or in part, by written notice to the Company, effective immediately prior to, and conditional upon, the consummation of a Takeout Major Transaction or, in the case of an Asset Sale, the Company’s distribution of assets to its stockholders, as applicable (a “Successor Major Transaction Conversion”), the outstanding principal amount of its Notes into the amount of cash and other assets and the number of securities or other property of the Successor Entity or other entity that such Holder would have received had such Holder converted the Major Transaction Conversion Amount (as defined below) into the number of shares of Common Stock equal to the Base Conversion Shares plus the Additional Conversion Shares (each as defined below) (without regard to the Beneficial Ownership Cap, the NYSE Share Cap, the Remaining NYSE Share Cap Amount or any other restriction or limitation on conversion) immediately prior to such Takeout Major Transaction or distribution of assets (as applicable) (the “Successor Major Transaction Consideration”), and (2) in the case of any one or more Major Transactions other than (x) a Successor Major Transaction (a “Company Share Major Transaction”) or (y) a Major Transaction described in clause (g) of the definition thereof, each Holder shall have the right to convert, in whole or in part, following the occurrence of any such Major Transaction and from time to time thereafter, the outstanding principal amount of its Notes into a number of shares of Common Stock equal to the Base Conversion Shares, plus the Additional Conversion Shares determined with respect to any such Major Transaction and any such Major Transaction Conversion Amount (“Major Transaction Company Shares”). For the avoidance of doubt, the Company’s delivery of a Mandatory Major Transaction Repurchase Notice shall in no way affect any Holders’ right to elect a Successor Major Transaction Conversion in respect to any or all of the principal amount of such Holder’s Notes.