ISSUANCE OF CONVERSION SECURITIES Clause Samples

The 'Issuance of Conversion Securities' clause defines the process by which a company issues new securities to investors who exercise their right to convert existing instruments, such as convertible notes or preferred shares, into equity. This clause typically outlines the types of securities that may be issued upon conversion, the timing and procedures for issuance, and any conditions or limitations that apply. For example, it may specify that upon conversion, investors receive common shares at a predetermined conversion rate. The core function of this clause is to provide a clear and standardized mechanism for converting investment instruments into equity, thereby ensuring predictability and fairness for both the company and its investors.
ISSUANCE OF CONVERSION SECURITIES. Subject to Section 2, as soon as practicable after conversion of this Note, the Company at its expense will cause to be issued in the name of and delivered to Registered Holder, a stock certificate or stock certificates and/or additional instruments for the Conversion Securities to which Registered Holder shall be entitled upon such conversion (bearing such legends as may be required by applicable United States and state and federal securities laws in the reasonable opinion of legal counsel of the Company, by the Company’s Certificate of Incorporation or Bylaws, or by any agreement between the Company and Registered Holder). Such conversion shall be deemed to have been made on the date of the closing of the Qualified Financing and Registered Holder shall be treated for all purposes as the record holder of such Conversion Securities as of such date. No fractional shares will be issued upon conversion of this Note. If upon any conversion of this Note, a fraction of a share would otherwise result, then in lieu of such fractional share the Company will pay the cash value of that fractional share, calculated on the basis of the applicable Conversion Price.
View SourceView Similar (5)
ISSUANCE OF CONVERSION SECURITIES. The Corporation will as soon as practicable after such deposit of a certificate or certificates for Series B Preferred Stock to be converted, accompanied by the written notice above prescribed, issue and deliver at such offices of the Corporation or at such other office or agency to the Person for whose account such Series B Preferred Stock was so surrendered, or to his nominee(s) or, subject to compliance with applicable law, transferee(s), a certificate or certificates for the number of whole shares of Common Stock to which such holder shall be entitled. Subject to Section 9.2(d), such conversion shall be deemed to have been made as of the date of such surrender of the Series B Preferred Stock to be converted, and the Person or Persons entitled to receive the Common Stock issuable upon conversion of such Series B Preferred Stock shall be treated for all purposes as the record holder or holders of such Common Stock on such date. Simultaneously with the delivery of such certificate(s) for such Common Stock, the Corporation also shall duly deliver to such holder all cash, other securities and other property, if any, to which he is entitled by virtue of the conversion of such Series B Preferred Stock. If fewer than all of the Series B Shares evidenced by any stock certificate delivered to the Corporation in connection with a conversion are to be converted, the Corporation shall also deliver to such holder, at the time of delivery of the certificate(s) representing such Common Stock, a new stock certificate, dated as of the Closing Date, evidencing the number of Series B Shares remaining unconverted and otherwise identical to the stock certificate for Series B Shares so delivered by such holder.
View Source
ISSUANCE OF CONVERSION SECURITIES. Conversion Securities (and any other securities issuable upon conversion, exercise or exchange thereof), upon conversion of the Notes in accordance with the terms thereof (and any other securities issuable upon conversion, exercise or exchange thereof), and Warrant Securities (and any other securities issuable upon conversion, exercise or exchange thereof) upon exercise of the Warrants in accordance with the terms thereof, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances and will not be subject to preemptive rights, rights of first refusal or other similar rights of stockholders of the Company (other than any such rights which shall have been waived prior to the Closing).
View Source

Related to ISSUANCE OF CONVERSION SECURITIES

  • Issuance of Conversion Shares The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note in accordance with its terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof.

  • Issuance of Convertible Securities If the Company in any manner issues or sells any Convertible Securities, whether or not immediately convertible (other than where the same are issuable upon the exercise of Options) and the price per share for which Common Stock is issuable upon such conversion or exchange is less than the Market Price on the date of issuance, then the maximum total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities will, as of the date of the issuance of such Convertible Securities, be deemed to be outstanding and to have been issued and sold by the Company for such price per share. For the purposes of the preceding sentence, the "price per share for which Common Stock is issuable upon such conversion or exchange" is determined by dividing (i) the total amount, if any, received or receivable by the Company as consideration for the issuance or sale of all such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof at the time such Convertible Securities first become convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities. No further adjustment to the Exercise Price will be made upon the actual issuance of such Common Stock upon conversion or exchange of such Convertible Securities.

  • Reservation of Conversion Shares The Conversion Shares issuable upon conversion of the Shares shall have been duly authorized and reserved for issuance upon such conversion.

  • Delivery of Conversion Shares Upon Conversion Not later than five (5) Trading Days after each Conversion Date (the “Share Delivery Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) the Conversion Shares which, on or after the earlier of (i) the six month anniversary of the Original Issue Date or (ii) the Effective Date, shall be free of restrictive legends and trading restrictions (other than those which may then be required by the Purchase Agreement) representing the number of Conversion Shares acquired upon the conversion of this Debenture (including, if the Company has given continuous notice pursuant to Section 2(b) for payment of interest in Common Shares at least 20 Trading Days prior to the date on which the Notice of Conversion is delivered to the Company, Common Shares allocated pursuant to the conversion of accrued interest otherwise determined pursuant to Section 2(a) but assuming that the Interest Notice Period is the 20 Trading Days period immediately prior to the date on which the Notice of Conversion is delivered to the Company and excluding for such issuance the condition that the Company deliver Interest Conversion Shares as to such interest payment prior to the commencement of the Interest Notice Period) and (B) a bank check in the amount of accrued and unpaid interest (if the Company has elected or is required to pay accrued interest in cash). On or after the earlier of (i) the six-month anniversary of the Original Issue Date or (ii) the Effective Date, the Company shall deliver any Conversion Shares required to be delivered by the Company under this Section 4(c) electronically through the Depository Trust Company or another established clearing corporation performing similar functions.

  • Purchase of Convertible Debentures Subject to the satisfaction (or waiver) of the terms and conditions of this Agreement, each Buyer agrees, severally and not jointly, to purchase at each Closing and the Company agrees to sell and issue to each Buyer, severally and not jointly, at each Closing, Convertible Debentures in amounts corresponding with the Subscription Amount set forth opposite each Buyer’s name on Schedule I hereto.