Convertible Promissory Note Financing: Part II – Common Terms

Convertible Promissory Note Financing: Part II – Common Terms by Shamim Mohandessi In our first installment, we reviewed some of the use cases for issuing convertible notes and the two common formats of convertible notes. In this second installment, we review the six central terms frequently negotiated in the issuance of convertible notes between issuers and holders. Generally, issuers negotiate: …

Convertible Promissory Note Financing: Part I – Introduction

Convertible Promissory Note Financing: Part I – Introduction by Shamim Mohandessi This series explores the convertible promissory note (referred to in this article series as a “convertible note”). A convertible note is an instrument frequently used by startup companies to: (1) finance early growth activities, before the formation of capital through the offering of priced equity, or (2) bridge financing, …