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In this video, Scott from Cruise Consulting discusses a sample convertible note agreement. He emphasizes the importance of using a law firm’s template for legal documentation. Key components of the agreement include the loan amount, repayment term, and valuation cap, which he notes has been covered in prior videos. He also highlights the necessity to specify whether the note converts into common or preferred stock; typically, institutional VCs prefer the latter. Scott recommends reviewing the convertible note template for better understanding, as it is concise yet informative.