Convertible Debenture

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					                                     [NAME OF CORPORATION]

        ___% CONVERTIBLE DEBENTURE DUE ____________ [DATE]
AMOUNT:         $_______________

FOR VALUE RECEIVED CORPORATION (hereinafter called the “Corporation”) acknowledges itself
indebted to and hereby promises to pay to the registered holder hereof on ____________, on presentation
and surrender of this Debenture at the registered office of the Corporation, the sum of $_______________,
and to pay interest thereon at the rate of ___% per annum, calculated yearly, in like money on the ____
day of __________ of each year during the term, as well after as before maturity or default, and payable
within ninety (90) days thereafter at such address as may be specified by the holder.

This Debenture shall be subject to the following conditions:

1.      Redemption

1.1     The Corporation may redeem this Debenture without penalty by paying the principal amount
outstanding on this Debenture (the “Principal”) together with all interest accrued but unpaid thereon as
at the effective date of redemption on or before _______________ and shall redeem this Debenture on

1.2    In order to effect a redemption of this Debenture, the Corporation shall deliver notice to the
holder of its intention to redeem the Debenture not less than 60 days prior to the effective date of

1.3     If the Corporation gives the notice referred to in paragraph 1.2, at any time during such notice
period the holder may elect to convert any amount outstanding on this Debenture into _______________
Shares of the Corporation (the “Shares”) provided that the holder follows the procedure referred to in
Section 2.

1.4      If the holder does not elect to convert this Debenture into Shares, the Corporation may deposit in
a special account in any chartered bank or any trust company in ___________ named in the Corporation’s
redemption notice, sufficient funds to fully redeem the Debenture, and thereafter the Debenture shall be
deemed to be redeemed as of the effective date of the redemption and the rights of the holder after such
redemption date shall be limited to receiving his or her Principal outstanding under the Debenture
together with any accrued but unpaid interest payable thereon at redemption, upon presentation of the
original Debenture for redemption. Following such deposit, no further interest will be payable upon the
redemption moneys after the effective date of redemption. Any interest which may accrue on any such
account shall belong to the Corporation.

1.5     Upon the issue of the Shares and the payment of any requisite moneys pursuant to the
conversion privilege referred to in section 2, this Debenture shall be deemed to be redeemed by the

2.      Conversion

2.1     The holder of the Debenture shall have the right at any time prior to the repayment of the
Principal to convert all or portion of the principal (but not including any accrued but unpaid interest
thereon) into fully paid and non assessable Shares at a price of $_____ per share.

2.2      In order to exercise the conversion privilege described above, the holder shall deliver to the
registered office of the Corporation (or to such other place as the Corporation may direct) written notice
(the “Notice”) which shall be irrevocable, signed by the holder, stating that the holder has not assigned
any of his or her right, title and interest in or under the Debenture and that the holder elects to convert
the Debenture or a portion thereof as of the date given in the Notice. The Notice shall be delivered to the
Corporation at least ____ days prior to the date it is to be effective and shall also state the name or names
(with addresses) in which the certificate for Shares which shall be issuable on such conversion, shall be

2.3     If the Principal to be converted does not divide equally by the Conversion Price, no fraction of a
Share shall be issued and the Corporation shall deliver the difference to the holder.

2.4      As promptly as practicable after the effective date of th
Description: Issue debentures as security for funding with this downloadable Convertible Debenture template. - The Debenture is issued by a corporation to a lender as security for a commercial loan. - The Debenture is convertible into shares in the capital of the corporation at any time prior to the repayment of the principal amount of the loan (but not including any accrued but unpaid interest). - This is a generic legal form which is not specific to any country, state or province. The Convertible Debenture template is fully editable and can be easily customized to meet your needs.
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