Document background
The Convertible Notes Agreement serves as a crucial financing instrument in the Nigerian business landscape, particularly for companies seeking flexible funding options without immediate equity dilution. This document is typically used when a company needs to raise capital but either cannot or prefers not to establish a firm valuation immediately. The agreement comprehensively addresses the rights and obligations of both the issuing company and investors under Nigerian law, including specific provisions required by the Companies and Allied Matters Act (CAMA) 2020 and the Investment and Securities Act 2007. It details the conversion mechanisms, which allow the debt to convert to equity upon specified triggers such as qualified financing rounds, maturity, or other predetermined events. The document includes essential protections for both parties, interest calculations, and compliance requirements specific to the Nigerian regulatory environment.
