Conversion parity is a concept in finance that refers to the equivalence between the value of a convertible security, such as a convertible bond, and the value of the common stock into which it can be converted.
The conversion ratio is a relationship that determines how many shares of common stock will be received in exchange for each convertible bond or preferred share when the conversion takes place.
A figure showing earnings per common share after assuming the exercise of all outstanding warrants and stock options, and the conversion of convertible bonds and preferred stock, all potentially dilutive securities.
A kicker is an added feature of a debt obligation, usually designed to enhance marketability by offering the prospect of equity participation. Common examples include convertible bonds, rights, and warrants. Kicker features may also be found in mortgage loans where ownership participation or a percentage of gross rental receipts is included. Kickers are also known as sweeteners.
Seed money is the initial capital used to start a business, often provided by venture capitalists, and can take multiple forms including subordinated loans, convertible bonds, or preferred stock.
A sweetener is a feature added to a securities offering to make it more attractive to purchasers, often enhancing its appeal and increasing the likelihood of the security being successfully issued.
