Close
To finalize an SPV, meaning the organizer uses the funds received from investors to purchase an asset. Upon completing the purchase, the SPV executes a
SPV Dictionary
This Special Purpose Vehicle (SPV) Dictionary serves as a comprehensive resource for understanding the terminology associated with these financial instruments. SPVs, by their nature, can involve a complex interplay of legal, accounting, banking, tax, compliance, and administrative considerations. This dictionary aims to provide clear and concise definitions for the key terms encountered in the context of SPVs.
Close Date
The date on which a closing event occurs, triggered by the earliest of the following, as defined by the Federal Securities and Exchange Commission: (1)
Closing (Multiple)
The process of new investors and/or additional capital investing in the same portfolio company or asset through the same legal entity during the same round
Conversion Price
The price at which a convertible note or SAFE converts into equity. It is typically the lower of either (1) the price paid per share
Convertible Note (Convertible Promissory Note, Convertible Debt, Convertible Loan)
A short-term debt instrument that converts into equity at a later date, typically used by early-stage companies to raise capital without immediately issuing ownership equity.
Counsel (Lawyer, Legal Counsel, Advocate, Attorney)
A professional who practices law, applying legal knowledge, procedures, and experience to address specific legal issues or advance the interests of clients. A lawyer is
CPA (Certified Public Accountant)
A designation granted by the American Institute of Certified Public Accountants (AICPA) to individuals who pass the CPA exam and meet the required work experience.
Crowdfunding
A method of raising capital by soliciting small contributions from a large number of individuals to invest in a portfolio company. Special Purpose Vehicles (SPVs)