Exchangeable equity-linked security
US7921058B1 · kind B1 · utility
Assignee
Inventors
Key dates
| Filing date | May 17, 2006 |
| Grant date | Apr 5, 2011 |
| Priority date | — |
| Expiry date | Jun 25, 2028 |
Classification
- Technology area (CPC G)Physics
- CPC primaryG06Q40/06
- WIPO fieldIT methods for management
- WIPO sectorElectrical engineering
Abstract
A method of creating, selling, converting, and redeeming exchangeable instruments that may result in favorable tax and/or accounting treatment for a company that is a parent to an issuing subsidiary. The parent company transfers a conversion option to a wholly owned subsidiary. The subsidiary attaches the parent's conversion option to its own nonconvertible debt instrument, creating an exchangeable instrument to be issued to investors. Payment for the exchangeable instrument is remitted to the parent for the value of the conversion option and to the subsidiary with respect to the nonconvertible debt instrument. The split obligations of parent and subsidiary may result in a relatively high tax interest expense and relatively low accounting interest expense. Use of a net share settlement feature may result in reduced dilution of the parent's equity.
Source: USPTO / EPO open patent data. Objective bibliographic and citation counts.