This article explores the legal nature of the Convertible Loan Agreement (CLA)—an innovative financing tool for startups—and the issues surrounding its implementation into the legislation of Uzbekistan. The primary objective of the study is to elucidate the theoretical and practical aspects of this "hybrid" institute, which emerges at the intersection of the law of obligations and corporate law. The article provides a detailed analysis of three fundamental elements that distinguish a CLA from a traditional loan: the conversion trigger, the valuation cap (deferred valuation mechanism), and the investor’s special non-proprietary powers. Interpreting the CLA based on the German legal concept of Gestaltungsrecht (transformative right), the author argues that it should be viewed not as a simple debt, but as an agreement for deferred corporate participation. The study compares the experiences of the United States, the United Kingdom, Germany, and Russia, while also examining critical norms for the startup ecosystem within EU Regulation 2017/1129 and Directive 2017/1132. As a scientific novelty, the article advocates for the introduction of the "Specific Performance" institute to guarantee the execution of CLAs in Uzbekistan’s legal system, emphasizes the importance of the "Most Favored Nation" (MFN) clause, and analyzes corporate restrictions in the assignment of rights process. In conclusion, the author provides specific proposals for improving the Civil Code and corporate legislation of the Republic of Uzbekistan, particularly by recognizing the CLA as a "mixed contract" and reducing bureaucratic barriers in the conversion process.

hybrid capital, convertible loan, legal regulation, entrepreneurship, investor, corporate law, Civil Code.

J. F.Coyle & J. M. Green, The SAFE Agreement in Startup Finance. Washington University Law Review. 2014.

L.Gullifer & J. Payne, Corporate Finance Law: Principles and Policy. Bloomsbury Publishing. 2020.

D.Mayers, Why firms issue convertible bonds: The matching of financial and real investment options. Journal of Financial Economics, 1998. 47(1), 83-102.

P.Jalan & G.Barone-Adesi, Equity issues and changes in expectations: An analytical approach. Journal of Banking & Finance, 1995. 19(3-4), 507–522.

J. R. Graham & C. R. Harvey, The theory and practice of corporate finance: evidence from the field. Journal of Financial Economics Volume 60, Issues 2–3, May 2001, pp. 187-243.

J. M. Fried & M. Ganor, Agency costs of venture capital control. New York University Law Review, 2006.

Directive (EU) 2017/1132 of the European Parliament and of the Council of 14 June 2017 relating to certain aspects of company law (codification). Available at: https://eur-lex.europa.eu/eli/dir/2017/1132/oj/eng

2021-yilda qabul qilingan “European Startup Nations Standard of Excellence” (EU SNS) deklaratsiyasi. https://startupnationsstandard.eu/

Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European crowdfunding service providers for business, and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937. Available at: https://eur-lex.europa.eu/eli/reg/2020/1503/oj/eng

Germaniya Fuqarolik kodeksi. https://www.gesetze-im-internet.de/englisch_bgb/englisch_bgb.pdf

Germaniyaning Aksiyadorlik jamiyatlari to‘g‘risidagi qonuni. https://www.gesetze-im-internet.de/aktg/

Buyuk Britaniyaning “To‘lovga qobiliyatsizlik to‘g‘risida”gi qonuni. https://www.legislation.gov.uk/ukpga/1986/45/contents

2006-yildagi Kompaniyalar to‘g‘risidagi qonun. https://www.legislation.gov.uk/ukpga/2006/46/contents

Buyuk Britaniyaning “Moliyaviy xizmatlar va bozorlar to‘g‘risida”gi qonuni. https://www.legislation.gov.uk/ukpga/2000/8/contents

AQSHning Yagona tijorat kodeksi. https://www.law.cornell.edu/ucc

Delaware general corporation law. https://delcode.delaware.gov/title8/c001/index.html