Conversion of Securities Clause Samples
The Conversion of Securities clause defines the terms and conditions under which one type of security, such as preferred shares or convertible notes, can be exchanged for another, typically common shares. This clause outlines the conversion ratio, timing, and any triggers or events—such as a financing round or company sale—that allow or require conversion. Its core practical function is to provide a clear mechanism for investors or holders to convert their securities, ensuring predictability and fairness in how ownership interests may change over time.
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Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of BCAC, Merger Sub, the Company or the holders of any of the following securities:
(a) each share of Company Capital Stock issued and outstanding immediately prior to the Effective Time (including shares of Company Capital Stock that are issued and outstanding immediately prior to the Effective Time resulting from the conversion or exercise of Company Preferred Stock, Company Warrants and Company Options prior to the Effective Time, but excluding any Dissenting Shares) shall be canceled and converted into the right to receive a number of shares of BCAC Common Stock equal to the Exchange Ratio (the “Per Share Merger Consideration”);
(b) each share of Company Capital Stock held in the treasury of the Company shall be canceled without any conversion thereof and no payment or distribution shall be made with respect thereto;
(c) each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and nonassessable share of common stock, par value $0.0001 per share, of the Surviving Corporation; and
(d) each Company Option that is outstanding immediately prior to the Effective Time, whether vested or unvested, shall be assumed by BCAC and converted into an option to purchase a number of shares of BCAC Common Stock (such option, an “Exchanged Option”) equal to the product (rounded down to the nearest whole number) of (x) the number of shares of Company Common Stock subject to such Company Option immediately prior to the Effective Time and (y) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to the quotient of (A) the exercise price per share of such Company Option immediately prior to the Effective Time divided by (B) the Exchange Ratio; provided, however, that the exercise price and the number of shares of BCAC Common Stock purchasable pursuant to the Exchanged Options shall be determined in a manner consistent with the requirements of Section 409A of the Code and Treasury Regulation Section 1.409A-1(b)(5)(v)(D); provided, further, that in the case of any Exchanged Option to which Section 422 of the Code applies, the exercise price and the number of shares of the Surviving Corporation stock purchasable pursuant to such option shall be determined in accordance with the foregoing, subject to such adjustments as are necessary in order...
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Purchaser, the Company or the holders of any of the following securities:
(a) Subject to Section 2.14, if Purchaser shall have purchased, pursuant to the Offer, the Maximum Offer Number of shares of Company Common Stock, each share of Company Common Stock (each, a "Share" and collectively, the "Shares") issued and outstanding immediately prior to the Effective Time (other than any Shares to be cancelled pursuant to Section 2.6(c)) shall be cancelled, extinguished and converted into the right to receive a number (rounded to the nearest one-millionth of a share) of fully paid and nonassessable shares of common stock, par value $2.50 per share ("Parent Common Stock"), of Parent equal to the Exchange Ratio (as defined below).
(b) Subject to Section 2.14, if the Offer is terminated pursuant to Section 1.1(b) or if Purchaser shall have purchased, pursuant to the Offer, less than the Maximum Offer Number of shares of Company Common Stock (the number of Shares so paid for and purchased in the Offer being referred to herein as the "Purchased Share Number"), each Share issued and outstanding immediately prior to the Effective Time (other than any Shares to be cancelled pursuant to Section 2.6(c)) shall be cancelled, extinguished and converted into the right to receive, (i) cash, in an amount equal to the product of Cash Proration Factor One (as defined below) multiplied by $37.125 and (ii) a number (rounded to the nearest one-millionth of a share) of fully paid and non-assessable shares of Parent Common Stock equal to the product of (x) 1 minus Cash Proration Factor One multiplied by (y) the Exchange Ratio.
(c) Each Share held in the treasury of the Company and each Share owned by Parent or Purchaser, in each case immediately prior to the Effective Time, shall be cancelled and retired without any conversion thereof and no payment or distribution shall be made with respect thereto.
(d) issued, fully paid and nonassessable share of identical common stock of the Surviving Corporation.
(e) If prior to the Effective Time, Parent or the Company, as the case may be, should (in the case of the Company, after obtaining the consent required by Section 5.1 hereof) split, combine or otherwise reclassify the Parent Common Stock or the Company Common Stock, or pay (or set a record date that is prior to the Effective Time with respect to) a stock dividend or other stock distribution in Parent Comm...
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company or the holders of any of the following securities:
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any further action on the part of Purchaser, the Company or the holders of any of the following securities (the aggregate of (a), (d) and (e), is the “Merger Consideration”):
(a) Each Share (other than any Shares to be canceled pursuant to Section 2.6(b) and any Dissenting Shares) shall be canceled and shall be converted automatically into the right to receive 2.341 shares (“Exchange Ratio”) of common stock, par value $.001 per share, of Parent (“Parent Stock”) and cash in lieu of fractional shares as set forth in Section 2.10, payable, without interest, to the holder of such Share, upon surrender, in the manner provided in Section 2.9, of the certificate that formerly evidenced such Share. Parent shall have the right to increase the Exchange Ratio as provided in Section 8.1(i). If, prior to the Effective Time, Parent should split or combine the shares of Parent Stock, or pay a stock dividend or other stock distribution in, or in exchange for, shares of Parent Stock, or engage in any similar transaction, the Exchange Ratio will be appropriately adjusted to reflect such split, combination, dividend, exchange or other distribution or similar transaction. Each Dissenting Share shall not be converted into the right to receive any shares of Parent Stock and shall only have the rights described in Section 2.8.
(b) Each Share held in the treasury of the Company and each Share owned by Purchaser, Parent or any direct or indirect wholly owned subsidiary of Parent or of the Company immediately prior to the Effective Time shall be canceled and retired without any conversion thereof and shall cease to exist, and no payment or distribution shall be made with respect thereto.
(c) Each share of common stock, no par value, of Purchaser issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one (1) duly authorized, validly issued, fully paid and nonassessable share of common stock, no par value, of the Surviving Corporation.
(d) Each holder of a Company Stock Option shall be given the election (i) to receive the cash payment described in Section 2.7(a), or (ii) to have such Company Stock Option cancelled and converted into the Parent options described in Section 2.7(a).
(e) Each right to acquire a share of Company Common Stock upon conversion of those certain 8.5% Convertible Subordinated Promissory Notes (the “Notes”), due July 1, 2009, in aggregate principal amoun...
Conversion of Securities. EXCHANGE OF CERTIFICATES
Conversion of Securities. Section 2.1 Conversion of Capital Stock................................................... 8 Section 2.2 Exchange of Certificates...................................................... 9 Section 2.3
Conversion of Securities. SECTION 2.01
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Purchaser, the Company, the Surviving Corporation or the holder of any of the following securities:
(i) each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than shares of Company Common Stock to be cancelled pursuant to Section 3.1(a)(ii) below and any Dissenting Shares) shall be automatically cancelled and extinguished and be converted into and become the right to receive from the Surviving Corporation $7.00 in cash per share without any interest thereon (the “Merger Consideration”), and all other rights of the holder thereof with respect thereto shall cease to exist;
(ii) each share of Company Common Stock issued and outstanding immediately prior to the Effective Time that is owned by Parent, Purchaser or the Company or any direct or indirect Subsidiary of Parent or the Company shall automatically be cancelled, and no payment shall be made with respect thereto; and
(iii) each share of Purchaser’s capital stock issued and outstanding immediately prior to the Effective Time shall be converted into and become one validly issued, fully paid and nonassessable share of the same class of capital stock of the Surviving Corporation.
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Acquiring Corp, Acquired Corp or the holders of any of the following securities:
(a) Each issued and outstanding share of common stock of Acquiring Corp shall be converted into one validly issued, fully paid and nonassessable share of common stock, par value $.001 per share, of the Surviving Corporation, an exchange of one (1) for one (1), as of February 15, 2003;
(b) Each share of capital stock of Acquired Corp ("Acquired Corp Capital Stock") of any class or series owned or held in treasury by Acquired Corp and all shares of Acquired Corp beneficially owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ shall be cancelled and retired without any conversion thereof and no payment or distribution shall be made with respect thereto;
(c) Subject to the provisions of Sections 1.6, each share of Acquired Corp Common Stock, par value $.001 per share ("Acquired Corp Common Stock") issued and outstanding immediately prior to the Effective Time (other than (i) shares cancelled in accordance with Section 1.5(b) and (ii) Dissenting Shares (as defined in Section 1.7 below)) shall be converted into one (1) (such number to be adjusted in accordance with Section 1.6 (as so adjusted, the "Acquired Corp Common Stock Exchange Ratio")) validly issued, fully paid and nonassessable share of common stock, par value $.001 per share, of Parent (the "Parent Common Stock"). Throughout this Agreement, "Parent Common Stock" shall refer to stock issued by Parent whether such stock is issued to Acquired Corp Stockholders or otherwise. As of the Effective Time, each share of Acquired Corp Common Stock shall no longer be outstanding and shall automatically be cancelled and retired, and each holder of record of a certificate representing any shares of Acquired Corp Common Stock shall cease to have any rights with respect thereto, other than the right to receive shares of the Parent Common Stock to be issued in consideration therefore upon the surrender of such certificate, if and to the extent requested by such holder.
Conversion of Securities. At the Effective Time, by virtue of the Merger and without any action on the part of Purchaser, the Company or the holders of any of the Shares:
(a) Each Share issued and outstanding immediately prior to the Effective Time (other than any Shares to be cancelled pursuant to Section 2.06(b)) shall be cancelled and shall be converted automatically into the right to receive an amount equal to the Per Share Amount in cash (the "Merger Consideration"), payable, without interest, to the holder of such Share, upon surrender, in the manner provided in Section 2.08, of the certificate that formerly evidenced such Share;
(b) Each Share owned by Purchaser, Parent or any direct or indirect wholly owned subsidiary of Parent or of the Company immediately prior to the Effective Time shall be cancelled and retired without any conversion thereof and no payment or distribution shall be made with respect thereto; and
(c) Each share of common stock, without par value, of Purchaser issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and nonassessable share of Common Stock, $.0025 par value per share, of the Surviving Corporation.