FTI Consulting Tax Life Sciences Insight Series – Tax Implications of Convertible Loan Notes
Quicker and simpler to execute than equity rounds and more flexible, Convertible Loan Notes (“CLNs”) help life science companies bridge funding gaps without giving up equity immediately or committing to rigid terms. However, the dual characteristics of debt and equity, that is a feature of a convertible loan, can lead to complex accounting and unforeseen tax consequences that are important to understand.
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