Automatic Conversion upon IPO Sample Clauses
The "Automatic Conversion upon IPO" clause stipulates that certain securities, such as preferred shares, will automatically convert into common shares if the company completes an initial public offering (IPO). Typically, this conversion occurs at a predetermined ratio and is triggered by the company’s shares being listed on a public stock exchange. This mechanism ensures that all investors hold the same class of shares post-IPO, simplifying the company’s capital structure and making it more attractive and straightforward for public market investors.
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Automatic Conversion upon IPO. Automatically and without any action by the Holder, upon the occurrence of the IPO (such date, the “Conversion Date”), the entire then outstanding portion of the Original Principal Amount, and all then outstanding accrued and/or capitalized PIK Interest shall be converted into the Company’s Common Stock (the “Conversion”). Upon the Conversion, the Holder shall surrender this Note to the Company. The Conversion shall have the effect of cancelling all indebtedness evidenced by this Note. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of any transfer agent of the Company and the Depository Trust Company, that may be payable with respect to the issuance and delivery of Common Stock upon the Conversion); provided, that the Company shall not be required to pay any taxes that may be imposed with respect to any applicable withholding or the issuance or delivery of the Common Stock upon the Conversion to Holder and no such issuance or delivery shall be made unless and until Holder has paid to the Company the amount of any such tax, or has established to the satisfaction of the Company that such tax has been paid.
Automatic Conversion upon IPO. In the event the IPO (defined below) is consummated prior to the maturity date set forth in Section 2, the outstanding principal amount of the Notes and all accrued interest thereon, calculated through the IPO closing date, shall be converted into common stock of Registrant (defined below) at a conversion price equal to the price per share to the public in the IPO (the "IPO Price"). In connection with such conversion, no fractional shares of common stock shall be issued; instead, the number of shares of common stock otherwise issuable will be rounded up to the next whole share."