Temporary Convertible Notes Clause Samples

The Temporary Convertible Notes clause establishes the terms under which a company issues short-term debt instruments that can be converted into equity at a later date. Typically, these notes are used to raise funds quickly, with the understanding that the debt will convert into shares during a future financing round or upon reaching a specific milestone. This clause provides a flexible financing mechanism for startups, allowing them to secure investment before a formal valuation is set, and helps align the interests of investors and the company by facilitating future equity participation.
Temporary Convertible Notes. (a) Until definitive Convertible Notes are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Convertible Notes. Temporary Convertible Notes shall be substantially in the form of definitive Convertible Notes but may have variations that the Company considers appropriate for temporary Convertible Notes and shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Convertible Notes in exchange for temporary Convertible Notes. (b) A Global Security deposited with the Depositary or with the Trustee as custodian for the Depositary pursuant to Section 2.01 shall be transferred to the beneficial owners thereof in the form of certificated Convertible Notes in definitive form only if such transfer complies with Section 2.06 and (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for such Global Security or if at any time such Depositary ceases to be a “clearing agency” registered under the Exchange Act and in either case a successor Depositary is not appointed by the Company within 90 days of such notice, or (ii) an Event of Default has occurred and is continuing. (c) Any Global Security or interest thereon that is transferable to the beneficial owners thereof in the form of certificated Convertible Notes in definitive form shall, if held by the Depositary, be surrendered by the Depositary to the Trustee, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Security, an equal aggregate principal amount of Convertible Notes of authorized denominations in the form of certificated Convertible Notes in definitive form. Any portion of a Global Security transferred pursuant to this Section shall be executed, authenticated and delivered only in denominations of $100 and any integral multiple thereof and registered in such names as the Depositary shall direct. (d) Prior to any transfer pursuant to Section 2.10(b), the registered holder of a Global Security may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a holder is entitled to take under this Indenture or the Convertible Notes.
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Temporary Convertible Notes. Pending the preparation of definitive Convertible Notes, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Convertible Notes which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Convertible Notes in lieu of which they are issued and with such appropriate insertion, omissions, substitutions and other variations as the officers executing such Convertible Notes may determine, as evidenced by their execution of such Convertible Notes. If temporary Convertible Notes are issued, the Company will cause definitive Convertible Notes to be prepared without unreasonable delay. After the preparation of definitive Convertible Notes, the temporary Convertible Notes shall be exchangeable for definitive Convertible Notes upon surrender of the temporary Convertible Notes at any office or agency of the Company designated pursuant to Section 1002, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Convertible Notes the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of definitive Convertible Notes of authorized denominations. Until so exchanged the temporary Convertible Notes shall in all respects be entitled to the same benefits under this Indenture as definitive Convertible Notes.
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Temporary Convertible Notes. Pending the preparation of --------------------------- definitive Convertible Notes, the Company may execute, and the Trustee shall authenticate, temporary notes ("Temporary Convertible Notes") which are printed, lithographed, or otherwise produced, substantially of the tenor of the definitive Convertible Notes in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations. If Temporary Convertible Notes are issued, the Company shall cause definitive Convertible Notes to be prepared without unreasonable delay. After the preparation of definitive Convertible Notes, the Temporary Convertible Notes shall be exchangeable for definitive Convertible Notes upon surrender of the Temporary Convertible Notes to the Trustee, without charge to the Holder. Until so exchanged, Temporary Convertible Notes will evidence the same debt and will be entitled to the same benefits under this Indenture as the definitive Convertible Notes in lieu of which they have been issued.
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Temporary Convertible Notes. 19 Section 2.11 Cancellation.....................................................................20
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Temporary Convertible Notes. Until definitive Convertible Notes are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Convertible Notes. Temporary Convertible Notes shall be substantially in the form of definitive Convertible Notes but may have variations that the Company considers appropriate for temporary Convertible Notes and shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Convertible Notes in exchange for temporary Convertible Notes.
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Related to Temporary Convertible Notes

  • Convertible Notes The Convertible Notes are subject to different conversion calculations depending on the event triggering conversion as described in the Notes (e.g., an IPO or other liquidity event). For illustration purposes, assuming the optional conversion right is exercised today, based on the current capitalization and the $50,000,000 assumed valuation specified for an optional conversion in the Notes, there would be 4,705,224 additional shares issued; provided however, that each holder of Notes is subject to a maximum 9.99% ownership of the shares of capital stock of the Company at any one time. This illustration calculation does not account for the 6% interest component.

  • Temporary Debentures Pending the preparation of definitive Debentures, the Company may execute, and the Trustee shall authenticate and deliver, temporary Debentures (printed, lithographed, or typewritten). Such temporary Debentures shall be substantially in the form of the definitive Debentures in lieu of which they are issued, but with such omissions, insertions and variations as may be appropriate for temporary Debentures, all as may be determined by the Company. Every temporary Debenture shall be executed by the Company and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Debentures. Without unnecessary delay the Company shall execute and shall furnish definitive Debentures and thereupon any or all temporary Debentures may be surrendered in exchange therefor (without charge to the holders), at the office or agency of the Company designated for the purpose in the Borough of Manhattan, The City of New York, and the Trustee shall authenticate and such office or agency shall deliver in exchange for such temporary Debentures an equal aggregate principal amount of definitive Debentures, unless the Company advises the Trustee to the effect that definitive Debentures need not be executed and furnished until further notice from the Company. Until so exchanged, the temporary Debentures shall be entitled to the same benefits under this Indenture as definitive Debentures authenticated and delivered hereunder.

  • Convertible Note From and after the Effective Time, the Company's $8,000,000 10% convertible subordinated promissory note, dated November 20, 1998, payable to Wind Point Partners III, L.P. (the "Convertible Note") shall, in accordance with the terms of the Convertible Note, represent the right, upon conversion thereof in accordance with its terms, to receive in cash, without interest, a single lump sum cash payment equal to the product of (i) the number of shares of Company Common Stock issuable upon the conversion of such Convertible Note in accordance with its terms immediately prior to the Effective Time and (ii) the Common Stock Merger Consideration, such cash payment to be reduced by any required withholding of Taxes.

  • Temporary Certificates (a) Pending the preparation of definitive Certificates, upon the order of the Depositor, the Trustee shall execute and shall authenticate and deliver temporary Certificates that are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Certificates in lieu of which they are issued and with such variations as the authorized officers executing such Certificates may determine, as evidenced by their execution of such Certificates. (b) If temporary Certificates are issued, the Depositor will cause definitive Certificates to be prepared without unreasonable delay. After the preparation of definitive Certificates, the temporary Certificates shall be exchangeable for definitive Certificates upon surrender of the temporary Certificates at the office or agency of the Trustee without charge to the Holder. Upon surrender for cancellation of any one or more temporary Certificates, the Trustee shall execute and authenticate and deliver in exchange therefor a like aggregate Certificate Principal Amount of definitive Certificates of the same Class in the authorized denominations. Until so exchanged, the temporary Certificates shall in all respects be entitled to the same benefits under this Agreement as definitive Certificates of the same Class.

  • Temporary Debt Securities Pending the preparation of definitive Debt Securities of any series, the Issuers may execute and the Trustee shall authenticate and deliver temporary Debt Securities (printed, lithographed, photocopied, typewritten or otherwise produced) of any authorized denomination, and substantially in the form of the definitive Debt Securities in lieu of which they are issued, in registered form with such omissions, insertions and variations as may be appropriate for temporary Debt Securities, all as may be determined by the Issuers with the concurrence of the Trustee. Temporary Debt Securities may contain such reference to any provisions of this Indenture as may be appropriate. Every temporary Debt Security shall be executed by the Issuers and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Debt Securities. If temporary Debt Securities of any series are issued, the Issuers will cause definitive Debt Securities of such series to be prepared without unreasonable delay. After the preparation of definitive Debt Securities of such series, the temporary Debt Securities of such series shall be exchangeable for definitive Debt Securities of such series upon surrender of the temporary Debt Securities of such series at the office or agency of the Issuers at a Place of Payment for such series, without charge to the Holder thereof, except as provided in Section 2.07 in connection with a transfer. Upon surrender for cancellation of any one or more temporary Debt Securities of any series, the Issuers shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of definitive Debt Securities of the same series of authorized denominations and of like tenor. Until so exchanged, temporary Debt Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Debt Securities of such series. Upon any exchange of a portion of a temporary Global Security for a definitive Global Security or for the individual Debt Securities represented thereby pursuant to Section 2.07 or this Section 2.08, the temporary Global Security shall be endorsed by the Trustee to reflect the reduction of the principal amount evidenced thereby, whereupon the principal amount of such temporary Global Security shall be reduced for all purposes by the amount to be exchanged and endorsed.