Contingent conversion trigger

Contingent conversion trigger

Used in the context of convertible instruments. The price of the stock must exceed the trigger price before the bond holder can convert to common stock at a pre-established conversion price. The trigger price exceeds the conversion price. In addition, after a certain number of years, the convertible instrument usually specifies that both the conversion price and the contingent conversion trigger will increase every year by, for example, a rate equal to LIBOR.

Contingent Conversion Trigger

In contingent convertible bonds, the price that the underlying stock must reach before conversion is allowed. All convertible bonds have a conversion price, which is the price one pays in order to exchange the bonds for stocks. Contingent convertible bonds, however, have a second, higher price that the underlying stock must meet before a bondholder is allowed to convert. This is called the contingent conversion trigger. For example, the conversion price for a contingent convertible bond may be $10 per share, but if the stock price is above $20 per share, the investor may not convert the bond. In this case, the contingent conversion trigger is $20. See also: Provisional Call Trigger Price, Trigger Price.
References in periodicals archive ?
the world's leading distributor of communication products, electrical and electronic wire & cable and a leading distributor of fasteners and other small parts ("C" Class inventory components) to Original Equipment Manufacturers, today announced that when it reports third quarter results on October 26, 2004 that earnings per share will be negatively affected due to the contingent conversion trigger on its 3.
As discussed in recent SEC filings, these shares represent the maximum number of common shares into which the Notes can be converted due to the contingent conversion trigger being met.
The contingent conversion trigger price for the quarter ending October 1, 2004 is $35.
If the price per share of American Express common stock exceeds a contingent conversion trigger price of $86.
As previously announced by IVAX, these notes are now convertible at the option of the holders, as IVAX has waived the contingent conversion triggers.
5% Convertible Senior Notes due 2025 will, effective as of December 1, 2005, become convertible at the option of the holders, as the contingent conversion triggers for the respective notes have been waived by IVAX as of such date.
In connection with the release of the contingent conversion triggers and the offer to purchase the Company's 4.