Unsecured notes issued by companies where the holder receives periodic coupon payments and an option to change the note into ordinary shares at a ratio which is pre-specified and remains constant over the life of the note are known as:

A) Warrants
B) third-party warrants
C) convertible notes
D) equity-linked deposits

Question

Unsecured notes issued by companies where the holder receives periodic coupon payments and an option to change the note into ordinary shares at a ratio which is pre-specified and remains constant over the life of the note are known as:

A) Warrants
B) third-party warrants
C) convertible notes
D) equity-linked deposits

Quizplus · Accepted Answer

Convertible notes are unsecured notes issued by companies where the holder receives periodic coupon payments at a pre-specified coupon rate,and an option to convert the note into ordinary shares at a conversion ratio that is pre-specified and remains constant over the life of the note.If the option is not taken up,the note continues to behave like any other fixed interest debt instrument.

Unsecured Notes Issued by Companies Where the Holder Receives Periodic