Document background
The Convertible Note Purchase Agreement is a crucial financing instrument commonly used in Hong Kong's startup and growth-stage company ecosystem. It serves as a bridge between debt and equity financing, allowing companies to raise capital without immediately determining a firm valuation. This document is typically used when a company needs interim financing before a larger equity round, or when parties prefer to defer valuation discussions. The agreement, governed by Hong Kong law, must comply with local securities regulations and corporate law requirements. It includes essential terms such as conversion price, interest rate, maturity date, and investor rights, while also addressing Hong Kong-specific regulatory considerations. The document is particularly valuable for startups and growth companies in Hong Kong's dynamic business environment, offering flexibility in fundraising while providing investors with potential equity upside.
