Convertible Notes
Bridge your next equity round with a convertible note — SAFE agreements, Compulsorily Convertible Debentures (CCDs) and convertible instruments structured, documented and filed.
Structure your convertible note correctly
Tell us your bridge financing requirement. We draft the convertible instrument, negotiate terms and handle all filings.
Talk to a CS →A complete convertible note structuring package
Instrument Selection
Right instrument chosen — SAFE, convertible note or CCD — based on investor type and FEMA rules.
Term Negotiation
Valuation cap, discount rate, interest rate and conversion trigger terms negotiated and documented.
Agreement Drafting
Convertible note or SAFE agreement drafted and reviewed with investor's counsel.
CCD Structuring
Compulsorily Convertible Debentures structured for Indian investors — board resolution and allotment.
ROC Filing
Debenture allotment, Form PAS-3 and charge creation filed with ROC within prescribed timelines.
FEMA Compliance
FEMA-compliant convertible note structure for foreign investors — Form FC-GPR on conversion.
What to get right in a convertible note
Valuation Cap
Sets the maximum valuation at which the note converts — protects early investors from excessive dilution.
Discount Rate
Typically 15–25% — gives early investors a lower conversion price than equity round investors.
Conversion Trigger
Define clearly what triggers conversion — qualified equity round, maturity date or acquisition.
SAFE vs Note
SAFEs are simpler and have no interest or maturity date. Convertible notes accrue interest and have a repayment obligation if not converted.
CCD for Indian Investors
Foreign investment via convertible notes has FEMA restrictions — CCDs are the standard compliant instrument for Indian investors.
ROC Filing of CCDs
Issuance of CCDs requires board resolution, Form PAS-3 and charge registration — all within 30 days.
A convertible note without a valuation cap gives early investors no protection. Always set a cap — it defines the maximum price at which investors convert, protecting them if the company raises at a high valuation.
Common issues in convertible note structuring
Simple steps, no surprises
Instrument and terms decided
SAFE, convertible note or CCD chosen; valuation cap, discount and trigger defined.
Agreement drafted
Convertible instrument agreement drafted and reviewed by both parties.
Board resolution and allotment
Board resolution approving CCD issuance passed — allotment documented.
ROC and FEMA filings
Form PAS-3, charge registration and FC-GPR (on conversion) filed within timelines.
Other services you may need
Frequently asked questions
A convertible note is a short-term debt instrument that converts into equity at a future financing round. Startups use it to raise bridge capital before a priced equity round — avoiding the need to agree on a valuation immediately.
A SAFE (Simple Agreement for Future Equity) is a convertible instrument that converts into equity at a future round without accruing interest or having a maturity date. Originally from Y Combinator, SAFEs are simpler than convertible notes but have FEMA complications for foreign investors in India.
A Compulsorily Convertible Debenture (CCD) is a debt instrument that must convert into equity at a future date or event. CCDs are the FEMA-compliant convertible instrument for Indian investors and foreign investors under the automatic route.
A valuation cap is the maximum company valuation at which a convertible note will convert into equity. If the company raises a round above the cap, the investor converts at the cap price — giving early investors better terms than later investors.
Foreign investment via simple convertible notes has restrictions under FEMA. The standard compliant route for foreign convertible investment in India is through CCDs under the automatic route or FCCB route, with RBI pricing guidelines and Form FC-GPR on conversion.
Ready to structure your convertible note round?
We draft the instrument, negotiate terms and handle all ROC and FEMA filings — bridge capital done right.