CONVERTIBLE SENIOR DEBENTURE AGREEMENT

This Convertible Senior Debenture Agreement (hereinafter referred to as the “Agreement”) is made on [INSERT DATE ON WHICH THE AGREEMENT COMES INTO FORCE] (hereinafter referred to as the “Effective Date”) between:

[INSERT NAME OF THE COMPANY], having registered office at [INSERT ADDRESS OF THE COMPANY] (hereinafter referred to as the “Company” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns); and 

[INSERT NAME OF THE COMPANY], having registered office at [INSERT ADDRESS OF THE COMPANY] (hereinafter referred to as the “Investor” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns).

The “Company” and the “Client” together shall be referred to as “Parties” and individually as a “Party”.

WHEREAS

1. The Company is engaged in the business of [INSERT BRIEF DESCRIPTION OF BUSINESS] and desires to raise capital for its business operations and development.
2. The Investor is willing to invest [INSERT AMOUNT TO BE INVESTED] in form of debentures which can be converted into shares or funds at a later stage.
3. Parties seek to establish a business relationship with the investor providing the capital to the Company for expansion and related operations in consideration of monetary and other rewards.
4. The parties are duly authorized and have the capacity to enter into this agreement.
5. Both the parties affirm to understand the provisions contained herein and in case either party requires clarification as to one or more provisions, either party has had the right to seek clarifications or sought legal guidance.

NOW, THEREFORE, in consideration of the mutual promises contained herein and intending to be legally bound, the Parties have agreed as follows:

1. DEFINITIONS
   1. “Company” shall mean a corporation existing under the laws of [INSERT COUNTRY OF APPLICABLE LAWS].
   2.  "Investor" shall mean the party providing capital to the Company in the form of debentures.
   3. “Debenture” shall mean the convertible debenture issued by the Company to the Investor.
   4. Confidential Information" means any non-public information, data, documentation, trade secrets, know-how, or any other information disclosed by one party to the other party in connection with this agreement, whether in written, oral, electronic, or any other form, and identified as confidential or which the Parties should reasonably understand to be confidential.
2. TERM
   1. The present agreement shall be valid for a period of ­­­[INSERT TERM OF THE AGREEMENT] years. The agreement shall be renewed or superseded by another agreement before the completion of the term. If the agreement is not expressly terminated or superseded, it shall continue to remain in force.
3. CONSIDERATION
   1. The investor agrees to invest [INSERT AMOUNT TO BE INVESTED] in the Company business in the form of debentures with fixed quarterly income and an additional annual interest at the rate of [INSERT PERCENTAGE OF ADDITIONAL ANNUAL INTEREST].
   2. The Company agrees to give an offer to the investor to convert these debentures into shares/bonds at a later stage with discount as decided by the Company. The investor is also free to approach the Company for the conversion of these debentures into shares/bonds after a period of [INSERT PERIOD OF CONVERSION OF DEBENTURES INTO BONDS] years or at the end of the investment period.
4. DUTIES AND RIGHTS OF THE INVESTOR
   1. The Investor shall provide the Company with [INSERT AMOUNT/ NUMBER OF DEBENTURES] in reward of considerations for an investment period of [INSERT NUMBER OF YEARS] years.
   2. The Investor shall not interfere in the decision-making process, regular activities and operations of the Company, shall not vote or veto in any meeting unless any of these powers have been conferred upon the investor by the Company in express and written manner.
   3. The Investor shall not disclose the financial details, present contract terms, employee database, business plans and ideas of the Company to any other person who is not associated with the current deal.
   4. The Investor shall provide the Company with his preferred mode of payment 15 days in advance before any scheduled quarterly payment. Failing to do so may delay the process of payment and the Company shall not be held liable or responsible for the delay in payment.
   5. The investor shall not represent the Company, sue or get sued on behalf of the company and use the Company’s goodwill for any matter without express written consent of the company.
5. DUTIES AND RIGHTS OF THE COMPANY
   1. The Company shall provide the investor with an opportunity to convert the debentures of value [INSERT AMOUNT] into shares or bonds any time before or at the end of the present agreement.
   2. The Company shall provide the conversion option to the investor at a discount, which shall be decided by the parties as and when required during the course of business.
   3. The Company reserves the right to reject any request of conversion of debentures into shares/bonds from the investor before the end of the investment period.
   4. The Company reserves the right to use the investment money at its own discretion for the expansion and operations of the company without any external influence from the Investor.
6. EVENTS OF DEFAULT
   1. Both parties shall oblige the terms of the present contract in good faith and with full sincerity. In case a default or material breach is committed by any party such as default of payment on scheduled time, undue representation by the investor in the company’s affair, the aggrieved party shall send a breach notice to the defaulting party.
   2. The defaulting party is bound to reply within 7 days and if the reply is not in accordance with terms of this contract, the aggrieved party can approach an arbitrator defined under this agreement.
7. FORCE MAJEURE
   1. Neither party shall be held liable for any failure or delay in performing its obligations under this Agreement if such failure or delay is caused by events beyond the reasonable control of the affected party, including but not limited to acts of God, natural disasters (e.g., floods, earthquakes, hurricanes), war, terrorism, riots, labour strikes, governmental actions, epidemics or pandemics, power outages, or other similar events ("Force Majeure Events").The affected party shall promptly notify the other party in writing of the occurrence of a Force Majeure Event, providing reasonable details of the event, its expected duration, and the steps being taken to mitigate its impact. Failure to provide timely notice may result in the affected party forfeiting its rights under this clause. If a Force Majeure Event continues for a period exceeding [INSERT THE NUMBER OF DAYS CONSTITUTING PERIOD EXCEEDING WHICH, IF THE FORCE MAJEURE CONTINUES, EITHER PARTY MAY TERMINATE THE AGREEMENT] days, either party may terminate this Agreement upon written notice to the other party without further liability, except for obligations accrued prior to the Force Majeure Event.
8. APPLICABLE LAW
   1. This Agreement shall be governed by and constructed in accordance with the Laws, rules, orders and regulations of [INSERT THE COUNTRY OF APPLICABLE LAWS].
   2. The Parties shall resolve all disputes in connection with the validity or interpretation of this Agreement, unless otherwise expressly stated in the Agreement, in the following manner: 
   3. By direct negotiations between the Company and Investor. 
   4. If negotiations between the parties are unsuccessful, the matter shall be referred to the competent court sitting at [INSERT THE COURT WHICH SHALL HAVE EXCLUSIVE JURISDICTION IN CASE OF DISPUTE BETWEEN THE PARTIES] which shall have exclusive jurisdiction in all matters arising there from unless otherwise agreed between the Parties in writing.
9. NOTICES
   1. Any notice, request, demand, consent or other communication required or permitted under this Agreement shall be in writing and sent either via email on the email address as provided by the parties and shall be considered sent when the email is sent to the correct email address of the party or shall be given by personal delivery (including courier) by certified mail (confirmed by mail) addressed to the party for which it is intended at the address below and shall be deemed to be given on the day of delivery or transmission if within during normal business hours, or, if after business hours, on the next following Business Day, or if mailed by registered or certified mail, on the day which is seven (7) Business Days after such notice is mailed during normal postal conditions.  In the event of a postal disruption, any notice mailed will be deemed received on the seventh (7th) Business Day following resumption of regular postal service:
      1. If to the Company: [INSERT EMAIL ID OR/AND ADDRESS OF THE COMPANY]
      2. If to the Investor: [INSERT EMAIL ID OR/AND ADDRESS OF INVESTOR]
   2. Either party may change its address/email address for notices and other communications upon notice to the other party in the manner aforesaid.
10. DISPUTE RESOLUTION
    1. The Parties shall endeavor to resolve any differences of opinion which may arise between them with respect to the provisions of this Agreement by negotiation between themselves personally or with the assistance of their attorneys and unless in the opinion of any party, acting reasonably, the matter in dispute is of such significant nature to warrant it being addressed otherwise, no party shall commence any public proceedings until the negotiations have failed to produce a resolution. In furtherance of the provisions of this paragraph, all Parties hereby agree to make themselves available on short notice and to negotiate promptly and in good faith, any matter any party may wish to negotiate.
    2. All disputes arising under this agreement shall be governed by and interpreted in accordance with the Arbitration laws of [INSERT COUNTRY/STATE OF ARBITRATION] , without regard to principles of conflict of laws. The parties to this agreement will submit all disputes arising under this Agreement to Arbitration in [INSERT COUNTRY/STATE OF ARBITRATION] before a single arbitrator .The arbitrator shall be selected by mutual agreement of the parties. The venue of Arbitration proceedings shall be [INSERT NAME OF COUNTRY AND CITY WHERE ARBITRATION SHALL BE CONDUCTED] No party to this agreement will challenge the jurisdiction or venue provisions as provided in this section. The decision of the Arbitrator shall be final and binding upon the parties.
11. MISCELLANOUS
    1. Modifications: Except as otherwise provided herein this Agreement shall not be amended or otherwise modified unless the modification or amendment is done in writing, signed and has been mutually agreed by both the parties.
    2. Language: The language of all communications between the parties pursuant to this Agreement, including notices and reports, will be the [INSERT LANGUAGE OF ALL COMMUNICATION].
    3. Severability: If any provision of this Agreement shall, to any extent, be held to be invalid or unenforceable, it shall be deemed to be separate and severable from the remaining provisions of this Agreement, which shall remain in full force and effect and be binding as though the invalid or unenforceable provision had not been included.
    4. Entire agreement: This agreement along with all the Exhibits constitutes the entire understanding and agreement of the parties with respect to its subject matter and supersedes all prior and contemporaneous agreements or understandings, inducements or conditions, express or implied, written or oral, between the parties. This Agreement may be executed in identical duplicate counterparts, each of which shall be deemed an original, and both of which together shall constitute one and the same instrument. 
    5. No Waiver: Any failure or delay of any Party hereto in exercising any right or privilege with respect to this Agreement shall not be construed to be a waiver or to affect the validity of any part of the Agreement and shall not retrain any of the Parties to enforce any of the provisions of the Agreement.
    6. Amendments and Assignments:  Any amendments to this Agreement shall be made, only if, both Parties agree upon such amendment in writing. This Agreement shall not be assigned by either party without the express, written consent of the other party.
    7. Headings: The headings upon the various sections are solely for convenience and reference only and shall not affect the scope, meaning, intent or interpretation of the provisions of this Agreement, nor shall such headings otherwise be given any legal effect.
12. DECLARATION
    1. Each of the parties hereto covenant and agree to execute and deliver such further and other agreements, assurances, undertakings or documents, cause such meetings to be held, resolutions passed, and by-laws enacted, exercise their votes and influence and do and perform and cause to be done and performed any further and other acts and things as may be necessary or desirable in order to give full effect to this Agreement.

IN WITNESS WHEREOF, the parties, intending to be legally bound, have each executed this agreement as of the effective date.

Signed, sealed and delivered on behalf of Company

Name: [INSERT NAME OF THE COMPANY/SIGNING AUHTORITY AND DESIGNATION]

Signature:

Date: [INSERT SIGNING DATE OF THE COMPANY]

Signed, sealed and delivered on behalf of Investor

Name: [INSERT NAME OF THE INVESTOR]

Signature: 

Date: [INSERT SIGNING DATE OF THE INVESTOR]