Q: Convertible Notes, Stock Shares, Cap Table?
I'm new in the company and this is my first job as an Executive Assistant, one of my task right now is our legal due diligence. Our lawyer stated that the convertible notes our founder provided is incorrect. I responded to her by asking help on how to rectify it because 1.) Our founder is unaware which one is incorrect 2.) Cap Table has the same info 3.) I don't have an idea on how it should be done. Yet her (lawyer) answer to my query is simply check the amount and it's date.
The problem here, I don't know how to check it.
A:
Convertible notes and stock shares are common financial instruments used by companies to raise funds and compensate employees. A cap table is a record of the company's ownership structure and can help track the allocation of shares and ownership stakes.
If your lawyer has indicated that the convertible notes provided by the founder are incorrect, it is important to address this issue promptly. One way to check the accuracy of the notes is to compare them to the terms of the original agreement or offering memorandum.
This may involve reviewing the original terms of the convertible notes, such as the interest rate, maturity date, and conversion ratio. You may also need to review any related documents, such as shareholder agreements or option grants, to ensure that they are consistent with the convertible notes.
If you are uncertain about how to conduct this review, it may be helpful to consult with a qualified attorney or financial professional who has experience with convertible notes and cap tables. They can provide guidance and support throughout the process and help ensure that the company's financial records are accurate and up-to-date.
Overall, it is important to take legal due diligence seriously and address any discrepancies or inaccuracies promptly. By maintaining accurate financial records and cap tables, the company can ensure that it is properly structured and positioned for success.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
