Document background
The Simple Convertible Loan Agreement serves as a critical financing tool in the Austrian business landscape, particularly for startups and growing companies seeking flexible funding options. This document type bridges the gap between traditional debt and equity financing by allowing companies to receive immediate funding while deferring complex valuation discussions to a future date. Under Austrian law, the agreement must comply with specific regulatory requirements, including those set forth in the Austrian Civil Code (ABGB), Commercial Code (UGB), and relevant corporate laws. The Simple Convertible Loan Agreement typically includes provisions for interest rates, conversion triggers (such as qualified financing rounds or exits), conversion price calculations, and investor rights. It's particularly useful for bridge financing, pre-Series A rounds, or when companies need quick access to capital without immediately determining a company valuation.
