Funding Agreement
Outsource your Funding Agreements to HJA
There are various stages involved in raising and closing the investment round, some of which may take an extended period depending on several variables. We support our clients throughout the fundraising process, from creating and reviewing the termsheet to executing the final contracts and transaction close. From the time the term sheet is drafted to due diligence, negotiating definitive agreements, fulfilling preconditions, and finally closing the transaction, we offer ongoing support and help.
Term Sheet
A term sheet is a legal agreement that sets out the basic terms and conditions of a proposed investment transaction. Not legally binding, a term sheet provides the founders and investors of a company an equal chance of presenting their views regarding a future investment to be made.
Shareholder Agreement
The relationship between shareholders and the company is outlined in a shareholder agreement. The agreement protects majority and minority shareholders' rights and obligations, which guarantees that all shareholders must be treated fairly.
Share Subscription Agreement
A share subscription agreement outlines the conditions under which a shareholder consents to purchase shares from a private corporation. A terms sheet is frequently used to formalise unwritten agreements between the parties.
Compulsory Convertible Debentures (CCD)
As the name implies, CCDs are debentures that must be compulsorily converted into equity after a specific period. In other words, CCDs are hybrid instruments because they initially function as debt with the possibility of becoming equity.
Optionally Convertible Debentures (OCD)
Debt securities termed as optionally convertible debentures allow an issuer to raise money and in exchange, pays the investor interest up until maturity.
Non-Convertible Debentures (NCD)
Non-convertible debentures (NCDs) are debentures that cannot be converted into shares or equity. Companies utilise NCD as a vehicle to raise long-term capital through a public Issue.
Convertible Note
A convertible note is short-term debt that converts into equity.In the context of a seed financing, the debt typically automatically converts into shares of preferred stock upon the closing of a Series A round of financing. In other words, investors loan money to a startup as its first round of funding; and then rather than get their money back with interest, the investors receive shares of preferred stock as part of the startup's initial preferred stock financing, based on the terms of the note.
Safe Notes
Startups frequently employ SAFE (or simple agreement for future equity) notes to obtain seed funding. In essence, a SAFE note serves as a legally-binding commitment to permit an investor to buy a certain number of shares at a predetermined price.
How can we help?
We at HJA believe in adding value to each of our services. Clients who approach us expect us to assist and provide them with transactional services, but our value system lies beyond our clients' expectations. At HJA, we believe in a well-rounded approach. We thrive daily to add value to our partners' and clients' growth and take pride in delivering beyond their expectations.
We take care of all the intricacies involved in functioning Startups, Funds, and Enterprises and guide them on the best route forward. As a team of professionals, our foremost duty is to guide and advise the client holistically and cater to their needs from a 360-degree angle.
