hard · Private Equity
An investor lends $500k via a convertible note with 6% annual interest, 20% discount, and a $5M valuation cap. After 12 months, a Series A occurs at an $8M pre-money valuation with 4M shares outstanding ($2.00/share).
At what price does the note convert?
- $1.60
- $2.00
- $1.25
- $1.50
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