Document background
This document template is designed for use in New Zealand business transactions where companies seek to raise capital through debt that can later convert to equity. A Secured Convertible Promissory Note is particularly suitable for growth-stage companies requiring bridge financing or interim funding before a larger equity round. The document structures the investment as a secured loan with defined interest rates and repayment terms, while providing conversion rights that allow the debt to transform into equity under specified conditions. It includes comprehensive security provisions compliant with New Zealand's Personal Property Securities Act 1999, detailed conversion mechanics, and appropriate investor protections. This instrument is commonly used in situations where companies need immediate funding but want to defer equity valuation discussions, or where investors seek the security of debt with the upside potential of equity.
