Upon a Qualified Financing Sample Clauses
The 'Upon a Qualified Financing' clause defines what happens when a company completes a significant new round of investment that meets certain pre-set criteria. Typically, this clause outlines how existing convertible securities, such as convertible notes or SAFEs, will automatically convert into equity at the time of the qualified financing, often at a predetermined price or discount. Its core practical function is to ensure a smooth and predictable transition for early investors, providing clarity on how and when their investments will convert into company shares during a major fundraising event.
Upon a Qualified Financing. For the purposes of this Agreement, a “Qualified Financing” shall mean a financing completed after the date hereof involving the sale of equity securities of the Company (or equity securities and securities exchangeable for or convertible into equity securities) primarily for capital-raising purposes resulting in gross proceeds to the Company of at least $5,000,000, not including the outstanding principal amount of the Notes, or any other convertible notes of the Company, and, in each case, any accrued and unpaid interest thereon. Upon the closing of any such Qualified Financing, all principal and interest on each Note shall automatically convert into that number and type of securities issued in such Qualified Financing (the “Qualified Financing Securities”) determined by dividing (i) the outstanding principal amount of such Note plus all accrued and unpaid interest thereon by (ii) the lower of (x) the Discounted Qualified Financing Price (as defined below), and (y) the Capped Price (as defined below). Each Purchaser agrees that, in connection with the conversion of the Notes in connection with a Qualified Financing in accordance with this Section 3.4(a), such Purchaser will execute all necessary documents in connection with such Qualified Financing reasonably requested of the Purchasers, including executing a definitive purchase agreement, investor rights agreement and such other financing agreements as shall be agreed upon by the Company and the other investors participating in such Qualified Financing.
Upon a Qualified Financing. Upon the closing of a Qualified Financing (as defined in Section 3.6 below), the principal and all unpaid and accrued interest on each Note shall automatically convert into that number of shares of the equity securities issued in such Qualified Financing (the “Qualified Financing Securities”) equal to the quotient of (i) the outstanding principal amount of such Note and all unpaid and accrued interest divided by (ii) the Qualified Financing Price (as defined in Section 3.6 below). In the event such Qualified Financing is consummated more than sixty (60) calendar days from the Closing, the denominator specified in clause (ii) of the immediately preceding shall equal the Discounted Qualified Financing Price (as defined in Section 3.6 below). The Purchasers agree in connection with the conversion of the Notes in accordance with this Section 3.4(a) to execute all necessary documents in connection with such Qualified Financing reasonably requested of the Purchasers and executed by all other participants in such Qualified Financing (such documents, the “Financing Documents”), including executing a definitive securities purchase agreement and such other financing agreements as shall be agreed upon by the Company or its ultimate parent, as the case may be, and the other investors participating in such Qualified Financing.
Upon a Qualified Financing. If the Company sells its equity securities in a transaction after the date on which this Note is issued, for aggregate gross proceeds to the Company (excluding cancellation of indebtedness under this Note and any additional notes or existing convertible debt of the Company) of at least One Million Dollars ($1,000,000) (a “Qualified Financing” and the securities sold in such financing referred to as “Financing Securities”), then all outstanding indebtedness under this Note shall automatically be converted (regardless of whether the Note is surrendered to Company) into shares of the Financing Securities at a conversion price per share equal to the greater of Two Cents ($0.02) or Seventy Percent (70.0%) of the price per share paid for the Financing Securities in the Qualified Financing (“Financing Securities Price”). At the closing of the Qualified Financing, the Holder shall become a party to, and be entitled to the same rights under, all agreements to which all other investors in the Qualified Financing become a party, and shall receive the same benefits bestowed upon such other investors.
Upon a Qualified Financing. Upon the closing of a Qualified Financing (as defined in Section 3.6 below), the principal and all unpaid and accrued interest on each Note shall automatically convert into that number of shares of the equity securities issued in such Qualified Financing (the “Qualified Financing Securities”) equal to the quotient of (i) the outstanding principal amount of such Note and all unpaid and accrued interest divided by (ii) the Discounted Qualified Financing Price (as defined in Section 3.6 below). The Purchasers agree in connection with the conversion of the Notes in accordance with this Section 3.4(a) to execute all necessary documents in connection with such Qualified Financing reasonably requested of the Purchasers and executed by all other participants in such Qualified Financing (such documents, the “Financing Documents”), including executing a definitive securities purchase agreement and such other financing agreements as shall be agreed upon by the Company or its ultimate parent, as the case may be, and the other investors participating in such Qualified Financing.
Upon a Qualified Financing. Upon the closing of a Qualified Financing (as defined in Section 3.6 below), the principal and all unpaid and accrued interest on each Note shall automatically convert into that number of shares of the equity securities issued in such Qualified Financing (the “Qualified Financing Securities”) equal to the quotient of (i) the outstanding principal amount of such Note and all unpaid and accrued interest divided by (ii) the Discounted Qualified Financing Price (as defined in Section 3.6 below). The Purchasers agree in connection with the conversion of the Notes in accordance with this Section 3.4(a) to execute all necessary documents in connection with such Qualified Financing reasonably requested of the Purchasers and executed by all other participants in such Qualified Financing (such documents, the “Financing Documents”), including executing a definitive securities purchase agreement and such other financing agreements as shall be agreed upon by the Company or its ultimate parent, as the case may be, and the other investors participating in such Qualified Financing.