conversion clause

conversion clause

(1) A clause in a mortgage loan that allows the borrower to convert from an adjustable-rate mortgage to a fixed-rate mortgage,or that allows the borrower to convert from interest-only construction financing to a lower interest rate and usually fully amortizing permanent financing. (2) A clause sometimes seen in leases and real estate sales contracts providing that any personal property left on the premises after lease expiration or after real estate closing may be discarded or retained, as the real estate owner desires, and will not constitute a conversion. (In other words,the owner has no responsibility to keep the property in a safe place and/or attempt to return it to the former occupant.)

References in periodicals archive ?
Where a debt is to be restructured by a bank, the aforesaid conversion clause will be incorporated before the restructuring agreement is entered into with the defaulting company.
There will be a mandatory conversion similar to CoCos, but also a voluntary conversion clause on the part of the holder," he said.
Also, Biotechna's management was successful in negotiating an automatic conversion clause for outstanding loans in the form of demand notes which will convert the debt to equity (common shares of the Corporation) upon receipt of funding essential for development of key elements of the Company's business plan from other third parties.
Shocked and depressed, he secluded himself in his apartment for several weeks, emerging to discover he had lost his opportunity to take advantage of the automatic conversion clause that would have changed his group health plan to an individual plan.
But even when you have a conversion clause, it is usually of little help.
The agreement provides for an equity involvement by RBCC with the option for RBCC to purchase a substantial percentage of the shares of the company by the exercise of the conversion clause in the agreement.
7 billion debt instrument from SAN with a mandatory conversion clause into BS's stock by October 2013 and the full transfer of all assets (US$1.
The Series D Preferred Stock has a mandatory conversion clause if the closing price of the Company's common stock averages $0.
The Series B Preferred Stock has a mandatory conversion clause if the closing price of the Company's common stock averages $1 or greater over a 10 day period.
The general meeting also decided to implement a conversion clause into the Articles of Association entailing that one B-share may be converted to one A-share during the period September 20 - December 10, 2004 by holders of a special conversion right.
During the meeting, a proposal for resolution to change the difference in voting rights between series A and series B shares is to be addressed, as will the implementation of a conversion clause by amending ss.
In order to implement the Global Stock Incentive Program in a cost efficient and flexible manner, the Board proposes the AGM 2001 to resolve on amendment of the Articles of Association to the effect that redeemable limited preference C-shares can be issued and that a conversion clause is incorporated in the Articles of Association to the effect that C-shares can be converted to B-shares.