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The Convertible Bond Agreement is a sophisticated financing instrument used when companies seek to raise capital while offering investors the potential upside of equity participation. This document is particularly relevant for growth-stage companies or those requiring significant capital investment who want to defer equity dilution while providing investors with security of debt and potential equity returns. Governed by Hong Kong law, it must comply with the Securities and Futures Ordinance and Companies Ordinance requirements. The agreement typically includes detailed provisions on conversion mechanics, anti-dilution protections, financial covenants, and events of default. It's commonly used in Hong Kong's dynamic financial market, especially by companies listed or planning to list on the Hong Kong Stock Exchange, or by private companies planning significant corporate events such as IPOs or M&A transactions.

1. Parties: Identification of the issuer, bondholders (or trustee if applicable), and any guarantors

2. Background: Context of the bond issuance, corporate approvals obtained, and purpose of the financing

3. Definitions: Detailed definitions of technical terms, financial metrics, and key concepts used throughout the agreement

4. Bond Issuance and Status: Terms of issuance, denomination, status and ranking of the bonds

5. Subscription and Settlement: Process for subscribing to the bonds, payment terms, and closing mechanics

6. Interest: Interest rate, calculation methods, payment dates, and default interest provisions

7. Conversion Rights: Terms and conditions for converting bonds into shares, including conversion price, period, and adjustment mechanisms

8. Redemption and Purchase: Provisions for early redemption, maturity redemption, and issuer's right to purchase bonds

9. Covenants: Issuer's obligations regarding financial matters, corporate actions, and information provision

10. Events of Default: Circumstances constituting default and consequences thereof

11. Meetings of Bondholders: Procedures for bondholder meetings and collective decision-making

12. Transfers and Registration: Rules for transferring bonds and maintaining the register of bondholders

13. Notices: Methods and requirements for giving notices under the agreement

14. Governing Law and Jurisdiction: Specification of Hong Kong law as governing law and jurisdiction provisions