Converting notes into company shares is one of the most important transactions an investor can have in a company. That is why it’s important to have a good cap table platform to keep track of all the company’s convertible note conversions.

Here is the step-by-step guide on how to convert notes on the Eqvista app.

Step 1: Log into your Eqvista account and select your company profile. You will reach the company’s dashboard. From here, click on “Securities” from the left-hand side and click on “Convertible Instruments”. You will be redirected to the following page.

Convertible Instruments

From here, we will click on “Note 2”.

Step 2: You will then reach the page where you will be able to see the details of “Note 2”.

convert to stock

Click on the button stated “Actions” on the top right-hand side. From the mini drop-down menu, click on “convert to stock”.

Step 3: Once you do this, a pop-up window will appear as shown below.

fill in the details to convert the note into shares

You will need to fill in the details to convert the note into shares such as the new share name, the security class to convert to, and the conversion method. There are two kinds of conversion methods. One is based on the valuation and the other is based on the price per share.

In this case, we selected the option of price per share. With this, you will also have to add the price per share along with some notes, if needed. Once done, you can click on “Save”.

Step 4: When you do this, you will reach a page where you can see how the conversion is done. After reviewing the terms of the conversion, and if all the details are correct, click on “submit” to convert that note into company shares.

submit to convert that note

Note: You can see the number of shares the person will get after the conversion and the cost of the shares based on the convertible instrument plan as seen on the top of the page.

Step 5: Once done, you will reach the following page where you can see that the convertible note has been converted into shares, as below.

convertible note has been converted into shares

But this does not show how it affects the secondary transactions in the company. The next step will show this.

Step 6: To see how it affects the secondary transactions, click on “Cap table” on the left-side menu and “secondary transactions” from the drop-down menu that appears. You will be directed to the following page.

 secondary transactions

On this page, click on the tab that states “Note Conversions” as shown above. With this, you will see the conversion you just made and how it is shown in the secondary transactions.

And just like this, you can easily convert notes into shares. To know more about how to use the Eqvista application, check out our support articles here!

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