Document background
The Convertible Note Contract is commonly used in German startup financing as a bridge funding instrument, typically deployed between equity funding rounds or when a company needs quick access to capital without immediate equity dilution. This document type is particularly relevant for German companies structured as GmbH or AG entities seeking flexible financing options. The agreement must comply with German corporate and securities laws, including specific requirements under the BGB, AktG, and GmbHG. It includes detailed provisions for the note's principal amount, interest calculations, maturity terms, and conversion mechanisms, while ensuring alignment with German regulatory requirements for both debt instruments and potential future share issuance. The document structure accommodates German notarization requirements where applicable and includes necessary corporate approval procedures.
