Document background
The Convertible Note Subscription Agreement is commonly used by startups and growth companies in Singapore seeking to raise capital without immediately diluting equity. It provides a bridge between debt and equity financing, offering investors the security of debt with the upside potential of equity. This document is particularly relevant in early-stage funding rounds where company valuation might be challenging to determine. Under Singapore law, the agreement must carefully balance regulatory compliance with commercial flexibility, particularly regarding securities laws and corporate requirements. It typically includes detailed provisions on conversion mechanisms, valuation caps, discount rates, and investor protections.
