Convertible Loan
/kənˈvɜːrtəbl loʊn/
Definitions
- (n.) A loan agreement that may convert into equity, typically shares, in the borrowing company under specified conditions.
The investor provided a convertible loan that could be exchanged for stock if the startup reached its funding goals.
Forms
- convertible loan
- convertible loans
Related terms
See also
Commentary
Convertible loans balance debt and equity features, requiring clear terms on conversion triggers, valuation, and investor rights to avoid disputes.
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