Term Conversion
Content
Definition
Term Conversion involves changing the terms of a financial instrument, such as converting a convertible note into equity shares during a startup`s equity financing round, according to predefined conditions.
Usage and Context
Term conversion changes a financial instrument’s terms, like turning notes into equity.
Frequently asked questions
- What is the conversion method of convertible notes? Convertible notes turn debt into shares during a funding round.
- What is a convertible conversion? A convertible conversion is the process of turning convertible debt or notes into equity shares, typically during a financing round.
- What are the terms of a convertible note? The terms of a convertible note usually include the amount borrowed, interest rate, due date, discount for conversion, and valuation cap.
Benefits
Term conversion offers flexibility to adjust financial instruments to meet changing needs.
Conclusion
Term conversion offers flexibility to adjust financial instruments as needed.
