Any genius here capable of shaking up that market?
1,251 karma · joined July 17, 2008
Any genius here capable of shaking up that market?
Maybe your problem is actually a graph coloring problem...
Hope it's helpful.
So, what metrics should they be aiming for to prove viability?
To add blank lines in your text output here in HN, hit return twice (\n\n).
(I speak as a Sci Fi fan).
Taken from: http://www.theatlantic.com/doc/196011/omaha (another submission)
Yes, you'll have to get the corporation to cover the cost of the shares. However, convertibles will give you a tax break since they go onto balance sheets as a liability, and so they effectively give you a ~35% discount.
The flip-side is that recipients will have to pay taxes on the implicit coupon payments. You really need to talk to a corporate accountant to get more details, and whether this is even a legal option for you, but definitely look into it.
EDIT
I misread your question. The payment becomes the responsibility of the issuing corporation, not the individual receiving the stock. That is a more clear answer :)
Hybrid bonds typically are issued as loan capital, but the issuer retains the right to exchange or convert the bonds into convertible preference shares with similar conversion rights and income. The purpose is generally to ensure that the bonds (as loan capital) have the tax offset-ability (against taxable profits) of loan interest, and perhaps pay gross to qualifying investors. At the same time, the ability to change the bonds into cumulative or non-cumulative preference capital should mean that they pose less balance sheet risk. The issuer only achieves the best of both worlds if the hybrid bond is structured so that non-payment of interest does not constitute an event of default.
For the PS: There could be some financial engineering involved with creating convertible bonds and selling those at a discount to employees. Again, we run into liquidity issues.
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(That's the best I can do for the -decay- rate).