Convertible Equity, A Better Alternative To Convertible Debt?
techcrunch.com
SEPTEMBER 2, 2012
If the startup can’t repay the loan, it will be in default under the note; in which case, the noteholders may force the company into bankruptcy (if the startup can’t renegotiate with investors to extend the loan). Basically, Convertible Equity removes the repayment at maturity and interest provisions of Convertible Debt.
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