convertible security

American Heritage® Dictionary of the English Language, Fourth Edition

1. n. A security that, at the holder's option, may be exchanged for another asset, typically a fixed number of shares of common stock.

Wiktionary

1. n. finance A security that can be converted into another security.

WordNet 3.0

1. n. a corporate security (usually bonds or preferred stock) that can be exchanged for another form of security (usually common stock)