THEORY - UPGRADING

Start the instance by issuing the following command:
SQL> STARTUP UPGRADE
Note:
The UPGRADE keyword enables you to open a database based on an earlier Oracle Database release. It also restricts logons to AS SYSDBAsessions, disables system triggers, and performs additional operations that prepare the environment for the upgrade.
You might be required to use the PFILE option to specify the location of your initialization parameter file.
Once the database is started in upgrade mode, only queries on fixed views execute without errors until after the catupgrd.sql script is run. Before running catupgrd.sql, queries on any other view or the use of PL/SQL returns an error.

What is the difference between startup Upgrade and Migrate ?

startup migrate:
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Used to upgrade a database till 9i.

Startup Upgrade
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From 10G  we are using startup upgrade to upgrade database.

What happens internally when you use startup upgrade/migrate?
It will adjust few database (init) parameters (irrespective of what you have defined) automatically to certain values in order to run upgrade scripts smoothely.
in other way..it will issue few alter statements to set certain parameters which are required to complete the upgrade scripts without any issues.

REFERENCE:

Oracle® Database Upgrade Guide 11g Release 2 (11.2)
http://docs.oracle.com/cd/E11882_01/server.112/e23633/upgrade.htm