The Convertible Notes Clause Samples
The Convertible Notes clause defines the terms under which a company issues debt instruments that can later be converted into equity, typically during a future financing round. This clause outlines the conditions for conversion, such as the triggering events, conversion price, and any applicable discounts or valuation caps. By specifying these mechanisms, the clause provides a clear framework for how investors' loans may become shares, balancing the interests of both the company and the investors and facilitating smoother future fundraising.
The Convertible Notes. Each Convertible Note shall; (i) have a lien on all of the Company's assets, and will be pari passu with all other senior secured debt issued by the Company (provided that Mandaric has executed the Intercreditor Agreement, and amendments thereto), (ii) accrue (but not pay current) interest at the annual rate of four percent (4%), (iii) mature on October 1, 2010, and (iv) be convertible into common stock of the Company at an initial conversion price of $.005 per share.
The Convertible Notes. The Company has authorized the issuance of its Convertible Notes in the aggregate original principal amount of up to $1,500,000. The Convertible Notes shall be in the form set forth as EXHIBIT A attached hereto. The Convertible Notes shall (a) be payable on the Maturity Date (except as otherwise provided herein), (b) bear interest (based on a 360-day year of twelve 30-day months) on the unpaid principal amount thereof and any accrued and unpaid interest thereon until due at the rate of 8% per annum, payable at maturity or prior prepayment of the Convertible Notes in full and (c) be convertible into shares of Common Stock as provided in SECTION 3.1 below.
The Convertible Notes. The Borrower shall not: (i) suffer to exist any event, circumstance or condition in respect of third-party guaranties that would permit or allow any holder thereof to demand payment of any sum in excess of $1,000,000 or (ii) permit any such guaranties to be: (x) renewed or extended or (y) amended, modified, supplemented or waived in any manner that is adverse to any Agent or Lender.
The Convertible Notes. The mortgage and security interest granted to Investors pursuant to the Mortgage and Security Agreement shall be released at such time as the outstanding principal amount of the Debentures is less than $3 million.
The Convertible Notes. Indebtedness of any Person that becomes a Subsidiary after the Closing Date as a result of a Permitted Acquisition or otherwise assumed in connection with a Permitted Acquisition, provided that such Indebtedness (and any Guarantees thereof) exists at the time of such Permitted Acquisition, and is not created in contemplation of or in connection with such Permitted Acquisition and refinancings in respect thereof;
The Convertible Notes. Warrants Conversion Shares and Warrant Shares are collectively referred to herein as the “Securities.”
The Convertible Notes