A security (usu. a bond or preferred stock) that may be exchanged by the owner for another security, esp. common stock from the same company, and usu. at a fixed price on a specified date. — Also termed (specif.) convertible debt; convertible stock. [Cases: Securities Regulation 53.16(10).]
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The security into which a convertible security may be converted, usu. common stock.
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A debenture that is subordinate to another debt but can be converted into a different security.
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A security with features of both a debt instrument (such as a bond) and an equity interest (such as a share of stock). • An example of a hybrid security is a convertible bond, which can be exchanged for shares in the issuing corporation and is subject to stock-price fluctuations.
A security representing an ownership interest in a corporation, such as a share of stock, rather than a debt interest, such as a bond; any stock or similar security, or any security that is convertible into stock or similar security or carrying a warrant or right to subscribe to or purchase stock or a similar
A debenture that the holder may change or convert into some other security, such as stock. [Cases: Corporations 473. C.J.S. Corporations § 670.]
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The conversion of a convertible security, after a call for redemption, when the value of the security that it may be converted to is greater than the amount that will be received if the holder permits the security to be redeemed.