Tendered for shares of common stock in the issuing firm

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Reference no: EM13880730

A convertible security may be tendered for shares of common stock in the issuing firm. In other words, the bonds or preferred stock may be converted to common stock.

Like warrants, convertibles can lead to diluted earnings, because new shares of common stock are issued. However, unlike warrants, convertibles:

1. Result in new capital for the firm

2. Do not result in new capital for the firm

Reference no: EM13880730

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