CONVERTIBLE LOAN AGREEMENT
_____________________________________________________________________________________
THIS CONVERTIBLE LOAN AGREEMENT ("Agreement") is made and entered into this 1st of January, 2050, by and between [LENDER NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] ("Lender"), and [BORROWER NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] ("Borrower").
_____________________________________________________________________________________
1. LOAN TERMS
The Lender agrees to loan the sum of $100,000 (the “Principal Amount”) to the Borrower under the terms and conditions herein contained. The Principal Amount shall accrue interest at a rate of 5% per annum. The Principal Amount and any accrued interest shall be due and payable in full by the Borrower to the Lender on or before December 31, 2050.
_____________________________________________________________________________________
2. CONVERSION TERMS
Subject to the terms and conditions of this Agreement, the Lender has the right to convert the Principal Amount, along with any unpaid interest, into fully paid and non-assessable shares of Borrower's common stock at a conversion ratio of 1:20. The number of shares issuable upon conversion of the loan shall be subject to adjustment upon any subsequent financing rounds.
_____________________________________________________________________________________
3. RIGHTS AND OBLIGATIONS
3.1. Duties of Lender: Lender agrees to provide the loan amount specified herein to Borrower by the terms of this Agreement. Lender shall have no obligation to provide additional funds to Borrower beyond the Principal Amount.
3.2. Duties of Borrower: Borrower agrees to use the loan proceeds for the purposes specified in this Agreement and to repay the Principal Amount and any accrued interest by the terms set forth herein. Borrower represents and warrants to Lender that it is in compliance with all laws applicable to its operations and possesses all permits necessary for business operation.
_____________________________________________________________________________________
4. EVENTS OF DEFAULT
An event of default ("Event of Default") shall mean any of the following:
(i) Borrower fails to pay any amount when due under this Agreement;
(ii) Borrower breaches any other term or condition of this Agreement.
Upon occurrence of an Event of Default, Lender may, at its discretion, declare all amounts owing under the Agreement to be immediately due and payable.
_____________________________________________________________________________________
5. GOVERNING LAW AND JURISDICTION
This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the laws of the state of [GOVERNING STATE] without regard to its laws governing conflicts of law. The parties hereto agree that any disputes arising from this Agreement will be resolved in the state or federal courts located within the state of [GOVERNING STATE].
IN WITNESS WHEREOF, the Parties have executed this Convertible Loan Agreement as of the date first written above.
[Your Name]
[Your Company Address]
[Date Signed]
[Borrower's Name]
[Date Signed]
_____________________________________________________________________________________
Agreement Templates @ Template.net
