Common Stock Issued Upon Conversion Clause Samples

The 'Common Stock Issued Upon Conversion' clause defines the process by which convertible securities, such as preferred stock or convertible notes, are exchanged for common stock in a company. This clause typically outlines the conversion ratio, timing, and any conditions or procedures that must be met for the conversion to occur. For example, it may specify that each preferred share converts into a set number of common shares upon a qualifying event, such as an IPO or acquisition. The core function of this clause is to provide clarity and predictability for both the company and investors regarding how and when convertible securities become common equity, thereby reducing disputes and ensuring fair treatment of all parties involved.
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Common Stock Issued Upon Conversion. (a) Prior to issuing of any shares of Common Stock under this Article XI, and from time to time thereafter as may be necessary, the Issuer will reserve, or cause the IPO Issuer to reserve, out of its authorized but unissued shares of Common Stock a number of shares of Common Stock sufficient to permit the conversion of all then-outstanding Notes and the issuance of any IPO Redemption Premium, as applicable. (b) Any shares of Common Stock delivered upon the conversion of the Notes will be newly issued shares or treasury shares, duly and validly issued, fully paid, nonassessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the holder or other Person to whom such shares of Common Stock will be delivered). In addition, the Issuer will endeavor to comply, or cause the IPO Issuer to comply, promptly with all federal and state securities laws regulating the offer and delivery of any shares of Common Stock issuable upon conversion of the Notes. (c) If any shares of the Common Stock issued upon conversion will, upon delivery as part of the conversion obligation, be “restricted securities” (within the meaning of Rule 144 or any successor provision in effect at such time), such shares of Common Stock (i) will be issued in book-entry form through the books and records of the Transfer Agent; and (ii) will bear any restrictive legends the Issuer and/or the IPO Issuer or the Transfer Agent deem necessary to comply with applicable law and/or any provision of any applicable IPO Lockup Agreement; provided, however, that subject to any IPO Lockup Agreement, the Issuer and/or IPO Issuer shall cooperate with the applicable holder to have such restrictive legends removed as soon as permitted under applicable law, including but not limited to providing the Transfer Agent with any requested opinions and/or letters of instruction. (d) Prior to or effective upon the consummation of an IPO, the applicable IPO Issuer will execute and deliver a supplemental indenture to the Trustee and the Issuer pursuant to which such IPO Issuer will agree to become party to this Indenture and to deliver the Common Stock issuable under this Article XI. (e) The Issuer estimates (in accordance with section 1.871-15(i)(2)(iii) of the Treasury regulations) that the amount of dividends that will be paid with respect to the Common Stock while the Notes remain outstanding will be zero.
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Common Stock Issued Upon Conversion. (a) The Company will reserve out of its authorized but unissued shares of Common Stock, and keep available to satisfy conversion of this Note, a number of shares of Common Stock sufficient to permit the conversion this Note, after giving effect to the largest number of Additional Shares that may from time to time be added to the Conversion Rate as provided in Section 8.07. (b) Any shares of Common Stock delivered upon the conversion of this Note will be newly issued shares or treasury shares, duly and validly issued, fully paid, nonassessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the Holder or other Person to whom such shares of Common Stock will be delivered). In addition, the Company will endeavor to comply promptly with all federal and state securities laws regulating the offer and delivery of any shares of Common Stock issuable upon conversion of this Note. The Company will also use its best efforts to cause any shares of Common Stock issuable upon conversion of this Note to be listed on whatever stock exchange(s) the Common Stock is listed on the date the Holder becomes a record holder of such Common Stock.
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Common Stock Issued Upon Conversion. (a) The Issuer shall at all times reserve out of its authorized but unissued shares of Common Stock a number of shares of Common Stock sufficient to permit the conversion, in accordance herewith, of all of the then-outstanding Notes. (b) Any shares of Common Stock delivered upon the conversion of the Notes will be newly issued shares or treasury shares, duly and validly issued, fully paid, nonassessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the Holder or other Person to whom such shares of Common Stock will be delivered). In addition, the Issuer will comply with all federal and state securities laws regulating the offer and delivery of any shares of Common Stock issuable upon conversion of the Notes. The Issuer will also cause any shares of Common Stock issuable upon conversion of a Note to be listed on whatever stock exchange(s) the Common Stock is listed on the date the converting Holder becomes a record holder of such Common Stock. (c) If any shares of the Common Stock issued upon conversion will, upon delivery, be “restricted securities” (within the meaning of Rule 144 or any successor provision in effect at such time), except as the Issuer may otherwise determine in compliance with applicable law, such shares of Common Stock (i) will be issued in physical, certificated form; (ii) will not be held in book-entry form through the facilities of the Depository; and (iii) will bear any restrictive legends the Issuer or the Transfer Agent deems necessary to comply with applicable law.
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Common Stock Issued Upon Conversion. (a) Prior to issuing of any shares of Common Stock under this Article 9, and from time to time thereafter as may be necessary, the Company will reserve out of its authorized but unissued shares of Common Stock a number of shares of Common Stock sufficient to permit the conversion of the Notes. (b) Any shares of Common Stock delivered upon the conversion of the Notes will be newly issued shares or treasury shares, duly and validly issued, fully paid, nonassessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the Holder or other person to whom such shares of Common Stock will be delivered). In addition, the Company will endeavor to comply promptly with all federal and state securities laws regulating the offer and delivery of any shares of Common Stock issuable upon conversion of the Notes. The Company will also use commercially reasonable efforts to cause any shares of Common Stock issuable upon conversion of a Note to be listed on whatever stock exchange(s) the Common Stock is listed on the date the converting Holder becomes a record holder of such Common Stock.
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Common Stock Issued Upon Conversion. (a) The Issuer shall at all times reserve out of its authorized but unissued shares of Common Stock a number of shares of Common Stock sufficient to permit the conversion, in accordance herewith, of all of the then-outstanding Notes. (b) Any shares of Common Stock delivered upon the conversion of the Notes will be newly issued shares or treasury shares, duly and validly issued, fully paid, nonassessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the holder or other Person to whom such shares of Common Stock will be delivered). In addition, the Issuer will comply with all federal and state securities laws regulating the offer and delivery of any shares of Common Stock issuable upon conversion of the Notes. The Issuer will also cause any shares of Common Stock issuable upon conversion of a Note to be listed on whatever stock exchange(s) the Common Stock is listed on the date the converting Holder becomes a record holder of such Common Stock.
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Common Stock Issued Upon Conversion 
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Related to Common Stock Issued Upon Conversion

  • Reservation of Stock Issuable Upon Conversion The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series Preferred, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of the Series Preferred. If at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series Preferred, the Corporation will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose.

  • Delivery of Common Stock Upon Conversion Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations hereunder, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion.

  • Reservation of Shares Issuable Upon Conversion The Company covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of this Debenture and payment of interest on this Debenture, each as herein provided, free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of the Debentures), not less than such aggregate number of shares of the Common Stock as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable (taking into account the adjustments and restrictions of Section 5) upon the conversion of the outstanding principal amount of this Debenture and payment of interest hereunder. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable and, if the Registration Statement is then effective under the Securities Act, shall be registered for public sale in accordance with such Registration Statement.

  • Conversion of Shares (a) At the Effective Time, by virtue of the Merger and without any further action on the part of Parent, Merger Sub, the Company or any stockholder of the Company: (i) any shares of Company Common Stock held by the Company, any wholly-owned Subsidiary of the Company (or held in the Company’s treasury), Parent, Merger Sub, and any other wholly-owned Subsidiary of Parent, immediately prior to the Effective Time shall be cancelled without any conversion thereof and no payment or distribution shall be made with respect thereto; (ii) subject to Sections 2.6(b), 2.8 and 2.9, each share of Company Common Stock outstanding immediately prior to the Effective Time and not described in Section 2.6(a)(i) shall automatically be converted into the right to receive the Common Stock Per Share Amount, without interest; (iii) each share of the common stock, $0.01 par value per share, of Merger Sub outstanding immediately prior to the Effective Time shall be converted into one share of common stock of the Surviving Corporation; (iv) subject to Section 2.6(b), each Vested Company Option outstanding and unexercised for which an Option Consent is obtained immediately prior to the Effective Time shall automatically be deemed exercised and the deemed shares of Company Common Stock associated with such exercise shall automatically be cancelled and, in consideration for such deemed exercise and automatic cancellation, the holder of such Vested Company Option shall be entitled to receive, with respect to each share of Company Common Stock issuable upon the exercise of such Vested Company Option and in full satisfaction of the rights of the holder with respect thereto, an amount in cash equal to the positive result, if any, of the Merger Option Consideration less any required withholding of Taxes; for avoidance of doubt, as a result of the foregoing, each Vested Company Option, and any deemed issuance of Company Common Stock associated with the deemed exercise, which shall not be issued, shall both be cancelled at the Effective Time; (v) each Vested Company Option outstanding and unexercised for which an Option Consent is not obtained immediately prior to the Effective Time shall automatically be terminated; and (vi) each outstanding Company Option that is not a Vested Company Option shall be automatically cancelled, without any exercise thereof and no payment or distribution shall be made with respect thereto. (b) Notwithstanding anything to the contrary including the definitions of Common Stock Per Share Amount and Merger Option Consideration, the maximum aggregate consideration to be paid pursuant to this Section 2.6 is $29,302,000. If (i) the number, type and rights of the shares of capital stock of the Company are not as set forth in Section 3.6, and/or (ii) the rights (whether options, warrants or any other rights) to acquire capital stock of the Company are not as set forth in Section 3.6, the consideration to be delivered in respect of a share of Company Common Stock and a Vested Company Option for which an Option Consent has been obtained (and accordingly, pursuant to Section 2.6) shall be adjusted downward as appropriate.

  • Settlement Upon Conversion The type and amount of consideration (the “Conversion Consideration”) due in respect of each $1,000 principal amount of a Note (including, for the avoidance of doubt, any PIK Interest paid with respect thereto) to be converted will be a number of shares of Common Stock equal to the Conversion Rate in effect on the Conversion Date for such conversion. (i) If the number of shares of Common Stock deliverable pursuant to Section 2.8(c) upon conversion of any Note is not a whole number, then such number will be rounded to the nearest whole number. (ii) If a Purchaser converts more than one Note on a single Conversion Date, then the Conversion Consideration due in respect of such conversion will be computed based on the total principal amount of Notes converted on such Conversion Date by or with respect to such Purchaser. (iii) The Issuer will pay or deliver, as applicable, the Conversion Consideration due upon the conversion of any Note to the Purchaser on or before the second Business Day immediately after the Conversion Date for such conversion. (iv) At all times when any Notes are outstanding, the Issuer will reserve, out of its authorized but unissued and unreserved shares of Common Stock, a number of shares of Common Stock sufficient to permit the conversion of all then-outstanding Notes, assuming the Conversion Rate is increased by the maximum amount pursuant to which the Conversion Rate may be increased pursuant to Section 2.9. (v) Each Conversion Share delivered upon conversion of any Note will be duly and validly issued, fully paid, non-assessable, free from preemptive rights and free of any lien or adverse claim (except to the extent of any lien or adverse claim created by the action or inaction of the Purchaser holding such Note or the Person to whom such Conversion Share will be delivered). If the Common Stock is then listed on any securities exchange, or quoted on any inter-dealer quotation system, then the Issuer will cause each Conversion Share, when delivered upon conversion of any Note, to be admitted for listing on such exchange or quotation on such system. (vi) Upon conversion, a Purchaser shall not receive any separate cash payment for accrued and unpaid interest, if any. The Issuer’s delivery of the Conversion Consideration shall be deemed to satisfy in full its obligation to pay the principal amount of the Note and accrued and unpaid interest, if any, to, but not including, the relevant Conversion Date. As a result, accrued and unpaid interest, if any (other than for the avoidance of doubt, PIK Interest), to, and including, the relevant Conversion Date shall be deemed to be paid in full rather than cancelled, extinguished or forfeited.