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Particularly, convertible equity, also referred to as convertible security, is debt that doesn't require repayment when it is matured. This type of debt is a cheap and quick method for newly established companies to raise capital from investors and venture capitalists.
A senior convertible note is a debt security that contains an option in which the note will be converted into a predefined amount of the issuer's shares. A senior convertible note has priority over all other debt securities issued by the same organization.
A convertible debenture is a hybrid financial instrument that has both fixed income and equity characteristics. In its simplest terms, it is a bond that gives the holder the option to convert into an underlying equity instrument at a predetermined price.
A convertible promissory note is a debt instrument that converts into equity of the issuing company upon certain events. Typically, a note would convert into equity in a subsequent equity financing round and perhaps upon the note's maturity or a sale of the company.
A convertible note is a short-term debt agreement that converts into equity at a future date. Usually, this happens when one of these events takes place: The company raises enough capital to reach a pre-determined benchmark. The term of the loan expires.