Mandatory Conversion and Conversion Price Sample Clauses
The "Mandatory Conversion and Conversion Price" clause defines the circumstances under which certain securities, such as convertible notes or preferred shares, are automatically converted into common stock and specifies the price at which this conversion occurs. Typically, this clause outlines triggering events—such as a qualified financing round or an IPO—that require conversion, and it details the formula or method used to determine the number of shares received upon conversion. Its core practical function is to ensure a clear and predictable process for converting securities, thereby protecting both investors and the company from disputes over conversion terms and valuation.
Mandatory Conversion and Conversion Price. (a) Subject to the terms and provisions of this Article XI, if, within 30 days following the occurrence and continuance of a Conversion Event, the Company receives a notice (the "Conversion Notice") from the Representative of the Senior Credit Facilities that the requisite composite of lenders party to Senior Credit Facilities have agreed in accordance with the terms thereof to exercise the Conversion Option, then the Holders shall be required to tender their Notes for conversion into Common Stock on the date (the "Conversion Date") set forth in such notice, which Conversion Date shall be a Business Day and shall be at least 15 days and no later than 45 days after the Company's receipt of such Conversion Notice. Upon such Conversion Date, the Notes shall be reduced pro rata in a manner so as to cause the remaining aggregate outstanding principal amount of the Notes, together with all accrued but unpaid interest thereon, to equal $7,500,000 immediately following such Conversion Date. The number of shares of Common Stock issuable upon conversion of a Note is determined by dividing the principal amount of the Note, plus any accrued but unpaid interest thereon, being so converted by the Conversion Price in effect as of the Conversion Date. The initial "Conversion Price" is stated in paragraph 11 of the Notes and is subject to adjustment as provided in this Article XI (the "Conversion Price"). The Notes may be converted into Common Stock in accordance with this Article XI only once and the amount to be so converted shall equal the sum of the then aggregate outstanding principal amount of the Notes, plus any accrued but unpaid interest thereon, LESS $7,500,000, with the remaining balance of the Notes being then due and payable on August 29, 2009.
Mandatory Conversion and Conversion Price. 44 Section 13.2 Effect of Consolidation, Merger or Conveyance on Conversion .................... 46
Mandatory Conversion and Conversion Price. (a) Subject to the other provisions of this Article 13, on the Conversion Date, so long as no Default or Event of Default shall then exist, each then Outstanding Security shall be automatically converted into that number of fully paid and non-assessable shares of Common Stock equal to the sum of (i) the then outstanding principal amount of such Security, plus (ii) accrued and unpaid interest and Special Interest, if any, on such Security to the Conversion Date, divided by the product of (A) 1.00 multiplied by (B) the Closing Price per share of Common Stock on the Trading Day immediately preceding the Conversion Date (such product being hereinafter referred to as the "Conversion Price"); provided, however, that the aggregate number of shares of Common Stock issuable upon any such conversion shall not exceed the Maximum Share Amount. If, on the Conversion Date, the Company has taken all action required to authorize the issuance of the Common Stock in conversion of the Securities and no Default or Event of Default shall then exist, then, notwithstanding that such Securities have not been Tendered, from and after the Conversion Date, all of the Securities shall no longer be deemed Outstanding and all rights relating to such Securities shall terminate, except only the right to receive, upon Tender of the Securities therefore, the Common Stock and cash (if any) pursuant to the provisions hereof, and the Person or Persons entitled to receive the Common Stock issuable upon the conversion shall be treated for all purposes as the record holder or holders of such Common Stock. If all the foregoing conditions have been satisfied, interest and Special Interest, if any, will cease to accrue on the Securities on the Conversion Date. Except as expressly provided herein, no other payment or adjustment will be made for dividends or distributions on shares of Common Stock issued upon conversion which were declared for payment to holders of Common Stock of record as of a date prior to the Conversion Date.
(b) As promptly as practicable on the Shelf Effective Date, the Company shall send (or cause to be sent) a notice to each Holder and the Trustee (which notice shall be sent to such Holder and the Trustee by telex or telecopier if (with respect to such Holder) such Holder has, at least five Business Days prior thereto, provided such telex or telecopier information to the Company or the Trustee), stating the Shelf Effective Date and, to the extent then known, the following: (i...
Mandatory Conversion and Conversion Price. (a) Subject to the terms and provisions of this Article XI, if, within 30 days following the occurrence and continuance of a Conversion Event, the Company
Mandatory Conversion and Conversion Price. Upon maturity, the principal amount of the Note will automatically convert into Common Stock and the Company will have the right to pay the accrued interest on the Note through the issuance of Common Stock or in cash. The number of shares of Common Stock which shall be issued upon conversion of a Note shall be determined by dividing the outstanding principal amount of, and accrued interest on (if applicable), such Note by the Conversion Price (as defined herein) in effect at the time of conversion. The "Conversion Price" per share at which shares of Common Stock shall initially be $3.00; provided however, that the Conversion Price shall be subject to adjustment pursuant to Section 14.4. Conversion. Conversion shall be deemed to have been effected on the maturity date, and such date is referred to herein as the "Conversion Date." As promptly as practicable on or after the Conversion Date, the Company shall issue and shall deliver at such office or agency a certificate or certificates for the number of full shares of Common Stock issuable upon conversion, together with payment in lieu of any fraction of a share, as provided in Section 14.3. No payment or adjustment shall be made upon any conversion on account of any interest accrued on the Notes surrendered for conversion after such surrender or on account of any dividends on the Common Stock issued upon conversion. Notes shall be deemed to have been converted immediately prior to the close of business on the day of surrender of such Notes for conversion in accordance with the foregoing provisions, and at such time the rights of the holders of such Notes as holders shall cease, and the Person or Persons entitled to receive the shares of Common Stock issuable upon conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock at such time.