The Convertible Notes Agreement serves as a crucial financing instrument in the Danish business landscape, particularly for startups and growth companies seeking flexible funding options. This document type bridges the gap between debt and equity financing, allowing companies to defer equity valuation while securing immediate funding. The agreement must comply with Danish corporate law requirements, particularly the Companies Act (Selskabsloven) and financial regulations. It typically includes detailed terms about the investment amount, interest rates, maturity dates, conversion triggers, and price calculations for equity conversion. The document is especially valuable during bridge financing rounds or when companies and investors prefer to postpone establishing a firm equity valuation. The Convertible Notes Agreement also includes provisions for investor protection, information rights, and conversion mechanics, all structured within the framework of Danish law.

1. Parties: Identification of the issuing company and the note holder(s)

2. Background: Context of the convertible note issuance and purpose of the financing

3. Definitions: Key terms used throughout the agreement

4. Subscription and Issuance: Terms of the note subscription, including amount, closing conditions, and issuance details

5. Interest: Interest rate, calculation method, and payment terms

6. Maturity and Repayment: Maturity date and repayment terms if not converted

7. Conversion Rights: Conditions and mechanics for converting the notes into equity

8. Conversion Price: Methodology for determining the price at which notes convert to equity, including any discounts

9. Automatic Conversion Events: Circumstances triggering mandatory conversion, typically including qualified financing rounds

10. Representations and Warranties: Standard declarations by both the company and the note holder

11. Information Rights: Company's obligations to provide financial and other information to note holders

12. Events of Default: Circumstances constituting default and consequences thereof

13. Transferability: Restrictions and conditions for transferring the notes

14. Amendments and Waivers: Process for modifying the agreement or waiving rights

15. Notices: Requirements for formal communications between parties

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