Conversion Feature
Definitions
- (n.) A provision in a security or financial instrument that allows the holder to convert it into another form, typically shares of common stock, under specified conditions.
The bond included a conversion feature that enabled holders to exchange it for equity shares.
Forms
- conversion features
Related terms
Commentary
A conversion feature is often negotiated to provide flexibility and potential upside to investors, typically requiring clear terms on conversion ratio and timing.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.