Payment Upon Conversion Clause Samples
The Payment Upon Conversion clause defines how and when payments are to be made if a convertible instrument, such as a convertible note or SAFE, is converted into equity. Typically, this clause specifies whether any accrued interest or other amounts owed under the original instrument must be paid out in cash or are instead converted into shares alongside the principal. For example, if a noteholder converts their debt into stock during a financing round, the clause will clarify if they receive cash for interest accrued or if that interest is also converted into equity. This clause ensures clarity for both parties regarding financial obligations at the point of conversion, preventing disputes and aligning expectations during the transition from debt to equity.
Payment Upon Conversion. Upon any conversion of any Security, the Company will deliver to Holders in respect of each $1,000 principal amount of Securities being converted a “Settlement Amount” equal to the sum of the Daily Settlement Amounts for each of the 25 Trading Days during the Observation Period.
Payment Upon Conversion. (a) In the event that the Company receives a Holder's Conversion Notice on or prior to the day that is 20 days prior to Final Maturity Date or, with respect to Securities being redeemed pursuant to Section 3.01, the applicable Redemption Date (the "FINAL NOTICE DATE"), the following procedures shall apply:
(i) Subject to the Company's right to elect to have such Securities offered to the Exchange Institution for exchange in lieu of the Company converting the Securities as set forth in Section 5.13, the Company shall be required to pay to such Holder in Cash the lesser of (A) the Conversion Obligation and (B) the principal amount of Securities being converted. With respect to the remaining portion, if any, of the Conversion Obligation in excess of the principal amount of the Securities being converted, the Company may elect to satisfy such obligation in Cash, shares of Common Stock or a combination thereof. The Company shall notify such Holder through the Trustee of the amount (the "CASH AMOUNT") of the Conversion Obligation that it shall satisfy in Cash (which must be expressed either as 100% of the Conversion Obligation or as a fixed dollar amount of not less than $1,000 per $1,000 principal amount of Securities being converted) at any time on or before the date that is two Business Days following receipt of such Holder's Conversion Notice (the "CASH SETTLEMENT NOTICE PERIOD"). If, at the end of the Cash Settlement Averaging Period, the Conversion Obligation is less than the Cash Amount, the Company shall deliver Cash only to the extent of the Conversion Obligation. If the Company timely elects to satisfy 100% of the Conversion Obligation in Cash or to pay a Cash Amount in excess of $1,000 per principal amount of Securities to be converted, such Holder may retract its Conversion Notice at any time during the two Business Day period immediately following the Cash Settlement Notice Period (the "CONVERSION RETRACTION PERIOD"). If no such election is made, no such retraction can be made (and such Conversion Notice shall be irrevocable).
(ii) The amount to be paid to a converting Holder shall be computed as follows:
(A) If the Company elects to satisfy the entire obligation with respect to the Securities being converted in Cash, the Company shall pay to such Holder, for each $1,000 principal amount of Securities being converted, Cash in an amount equal to the Conversion Obligation, and
(B) if the Company elects to satisfy a fixed portion (other than 100%) of t...
Payment Upon Conversion. (a) In the event that the Company receives a Holder’s conversion notice, for each $1,000 aggregate principal amount of Securities surrendered for conversion, the Company shall be required to pay to such Holder the aggregate of the Daily Settlement Amounts for each of the 20 consecutive Trading Days during the Cash Settlement Averaging Period (the “Settlement Amount”).
Payment Upon Conversion. Upon any conversion of Securities, the Company will deliver to converting Holders in respect of each $1,000 principal amount of Securities being converted a “Settlement Amount” equal to the sum of the Daily Settlement Amount for each of the 20 Trading Days during the Cash Settlement Averaging Period.
Payment Upon Conversion. (a) Upon conversion of a Holder's Security, the Company shall deliver, through the Conversion Agent, the following to such Holder for each $1,000 principal amount of Securities being converted, subject to the Company's right to elect to pay the Net Share Amount in cash: (1) cash equal to the sum of the Daily Cash Amounts, and (2) shares ("NET SHARES") of Common Stock, if any, with a value equal to the sum of the Daily Share Amounts (the "NET SHARE AMOUNT"), in each case for each of the 15 Trading Days during the related Observation Period. The Company shall deliver the foregoing on the third Trading Day immediately following the last day of the related Observation Period.
Payment Upon Conversion. If at least one of the conditions to conversion pursuant to Section 10.1(b) is satisfied, Holders may convert their Securities and shall be entitled to receive an amount of cash and shares of Common Stock, if any, as follows:
Payment Upon Conversion. (a) Upon any Optional Conversion or Mandatory Conversion in accordance with this Article 13:
(i) The Company shall deliver, to each converting Holder, as soon as practicable after the Conversion Date of such conversion, a number of Common Shares equal to (1) (A) the aggregate principal amount of Debentures to be converted, divided by
Payment Upon Conversion. (a) In the event that the Company receives notice of conversion on or prior to the day that is twenty (20) days prior to the Maturity of the Notes (the “Final Notice Date”), the following procedures will apply: If the Company chooses to satisfy all or any portion of the Company’s obligation (the “Conversion Obligation”) in cash, the Company will notify the holder through the Trustee of the dollar amount to be satisfied in cash (which must be expressed either as 100% of the Conversion Obligation or as a fixed dollar amount) at any time on or before the date that is two Business Days following the conversion date (the “Cash Settlement Notice Period”). If the Company timely elects to pay cash for any portion of the shares otherwise issuable to such holder, the conversion notice may be retracted by the holder at any time during the two Business Day period beginning on the day after the final day of the Cash Settlement Notice Period (the “Conversion Retraction Period”); no such retraction can be made (and a conversion notice shall be irrevocable) if the Company does not elect to deliver cash in lieu of shares (other than cash in lieu of fractional shares). If the conversion notice has not been retracted, then settlement (in cash and/or shares) will occur on the Business Day following the final day of the twenty (20) Trading Day period beginning on the day after the final day of the Conversion Retraction Period
Payment Upon Conversion. Subject to certain exceptions set forth in Section 5.03, the Company shall deliver to Holders in respect of each $1,000 principal amount of Securities surrendered for conversion a “Settlement Amount” equal to the sum of the Daily Settlement Amounts for each of the 20 consecutive Trading Days during the applicable Cash Settlement Averaging Period.
Payment Upon Conversion. Upon any conversion of any Security, the Company will deliver to Holders in respect of each $1,000 principal amount of Securities being converted a “Settlement Amount” equal to the sum of the Daily Settlement Amounts for each of the 40 Conversion Payment Trading Days during the Observation Period. The amount of cash payable will be equal to the lesser of the principal amount of the Security being converted and the conversion value of such Security. The Settlement Amount in respect of any Security converted will be delivered to converting Holders on the third Business Day immediately following the last day of the Observation Period for such Security.