Convertible Note
A Convertible Note is a form of short-term debt that converts into equity, usually in conjunction with a future financing round. The investor lends money to a startup and instead of getting the money back with interest, the investor receives equity in the company. Each convertible note is usually an unsecured, short-term debt instrument that converts into equity — typically preferred shares — under specified conditions, such as a future funding round. The conversion to equity can be mandatory in some conditions or elective in others.
Also known as
Convertible Loan, Convertible Debt
Ancestry paths
- Document / Artifact Document Types Transactional Document Agreements Debt Agreement Loan
- Document / Artifact Document Types Transactional Document Agreements Bankruptcy Agreement Debt Agreement Loan
- Document / Artifact Document Types Bankruptcy and Restructuring Document Bankruptcy Agreement Debt Agreement Loan
- Document / Artifact Document Types Transactional Document Agreements Debt Agreement Loan Promissory Note
- +6 more paths
Generated from sali-legal/LMSS at 3f9ac0c9357b (2026-03-10). JSON