Document background
The Equity Loan Agreement under Belgian law serves as a crucial financing instrument for companies seeking flexible funding solutions. It is particularly relevant for scale-ups and established companies looking to secure growth capital while maintaining cash flow flexibility. The document combines traditional loan provisions with sophisticated equity conversion mechanics, carefully structured to comply with Belgian Companies and Associations Code requirements. This type of agreement is typically used when investors want the security of debt with potential equity upside, or when companies prefer to defer equity dilution. The agreement must address specific Belgian legal requirements regarding corporate finance, security interests, and shareholder rights, while also considering tax implications for both parties. Importantly, an Equity Loan Agreement must be carefully structured to ensure enforceability under Belgian law and to maintain clarity regarding the conversion mechanisms and resulting shareholder rights.
