About the Course:
Convertible notes are a double-edged sword. On the one hand, they can be a source of quick and relatively uncomplicated funding for an emerging company. On the other hand, convertible notes can deter investment from venture capitalists. Also, the issue of price caps can be particularly contentious. The following are among the issues discussed during this session:
- How do convertible notes compare with Series A rounds in terms of time, expense and required documentation?
- Why is it helpful to avoid the issue of valuation during initial funding negotiations?
- How significant are the stipulated interest payments on convertible notes?
- Are personal guarantees required on convertible notes?
- How does the conversion mechanism work?
- Do convertible note holders typically receive control provisions such as Board seats?
- Are convertible notes typically converted into common or preferred stock?
- How do price caps work? What is the significance of price caps?
- In general, what is the venture capitalists' perception of the existence of convertible notes?
- Must holders of convertible notes be accredited investors?
- How are the maturities on convertible notes set?
- What happens if there is no triggering event associated with the convertible notes?
- What are the consequences of the receiving company being insolvent from a balance sheet perspective?
- What kind of prioritization does a note holder have if the company goes in to bankruptcy?
Course Leader: David Gitlin, Shareholder, Greenberg Traurig, LLP
David Gitlin focuses his practice on corporate and securities, with an emphasis on mergers and acquisitions, venture capital, technology development and corporate finance. For more than 30 years, David has counseled foreign clients doing business in the United States and U.S. clients doing business abroad. He has structured more than 100 venture deals, 80 exits, and 200 M&A deals, over half of which have been cross-border transactions involving leading businesses in Finland, India, Israel and Sweden, among others. His representation of U.S. clients has included the purchase or sale of businesses in more than 15 countries.
David represents both U.S. and foreign venture capital funds, and has handled numerous technology development transactions, particularly in the life sciences area. These include drug development, licensing and joint venture agreements involving biotech and pharmaceutical companies, as well as collaborations between industry and academia.
David is recognized by Chambers USA as a leading M&A attorney and is nationally ranked as a leading Venture Capital attorney. In 2005, he was recognized by the mayors of Philadelphia and Tel Aviv for exceptional accomplishments in developing business opportunities for Israeli companies in the United States.
Course Length: Approx. 1.0 hours
$175 PER USER
Optional: A quiz is offered for an additional $39. This quiz is delivered in true/false, multiple choice and very short answer format. Certificates of Achievement in Negotiating Convertible Note Raises will be furnished to those that score 70% and above.
Need help purchasing this course? Please contact Neomi Barazani at 609-919-1895 ext. 100 or at email@example.com.