The Convertible Loan Agreement under Danish law serves as a critical financing instrument for companies seeking growth capital while maintaining flexibility in their capital structure. This document is typically used when a company needs immediate funding but either cannot or prefers not to determine a fixed valuation immediately. The agreement details the loan terms, interest rates, and conversion mechanisms, all structured within the framework of Danish law, particularly the Danish Companies Act (Selskabsloven). It is commonly employed in startup and scale-up situations, bridge financing scenarios, or as part of larger funding rounds. The document includes essential provisions for conversion triggers, price adjustments, and investor protections, while ensuring compliance with Danish corporate and securities regulations. The Convertible Loan Agreement is particularly valuable when companies want to defer equity dilution while providing investors with the security of debt and the upside potential of equity.

1. Parties: Identification of the Lender(s) and the Borrower (Company), including registration numbers and addresses

2. Background: Context of the convertible loan, including purpose of the financing and basic transaction structure

3. Definitions: Definitions of key terms used throughout the agreement, including financial terms, conversion-related definitions, and technical terms

4. Loan Amount and Drawdown: Specification of the principal amount, drawdown conditions and mechanics

5. Interest: Interest rate, calculation method, payment dates, and default interest provisions

6. Repayment: Terms for repayment of the loan, including maturity date and early repayment provisions

7. Conversion Rights: Details of conversion mechanics, including conversion price, timing, and process

8. Conversion Price Adjustments: Anti-dilution provisions and other adjustments to the conversion price

9. Company Warranties: Standard warranties regarding company status, capacity, and authority

10. Information Rights: Lender's rights to receive financial and other information from the Company

11. Events of Default: List of events triggering default and consequences thereof

12. Assignment and Transfer: Provisions regarding transferability of the loan and conversion rights

13. Notices: Communication requirements and contact details

14. Governing Law and Jurisdiction: Specification of Danish law as governing law and jurisdiction for disputes

15. Miscellaneous: Standard boilerplate provisions including severability, entire agreement, and amendments