A contract between the shareholders (including investors) and the company that sets out how the company is governed and how key decisions are made.
It typically covers investment terms, cap-table, voting rights, transfer restrictions, exits, and protections for minority shareholders.
ASA – Advanced Subscription Agreement
An agreement where an investor pays now for shares to be issued later by the company, once certain conditions are met (for example, a future funding round or a long-stop date).
Unlike a loan, it is not repayable with interest.
SAFE – Simple Agreement for Future Equity
A simplified investment contract under which an investor provides funding now in exchange for the right to receive shares in the future, usually at a discount or valuation cap.
A SAFE is not a loan and does not accrue interest.
CBA- Convertible Bond Agreement
A convertible bond agreement is a contract under which an investor buys a bond (debt) issued by a company, with the right (or obligation) to convert the bond into shares of the company under predefined terms.
Until conversion, the investor is a creditor, typically entitled to interest and repayment at maturity.
If conversion occurs, the debt is exchanged for shares, and the investor becomes a shareholder.