Contingent Shares


Contingent Shares
Shares of company stock that are issued only if certain conditions are met. Contingent shares are similar to stock options, warrants and other convertible instruments in that there is a level of uncertainty associated with their issue. For example, for contingent shares to be issued, the corporation must generate earnings that exceed a certain threshold. Contingent shares are also important for common stock holders since the contingent shares can dilute the ownership of existing shareholders.

In the TARP bailout, the U.S. Treasury was granted contingent shares in certain companies. These shares were meant to offset the risk of loss for taxpayers. Under the terms of the agreement, the contingent shares vest automatically if the U.S. Treasury loses money as a result of purchasing the troubled assets.


Investment dictionary. . 2012.

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  • Contingent Deferred Sales Charge (CDSC) — A fee (sales charge or load) that mutual fund investors pay when selling Class B fund shares within a specified number of years of the date on which they were originally purchased. Also known as a back end load or sales charge . For mutual funds… …   Investment dictionary

  • Contingent value rights — A Contingent Value Rights (CVR) is a type of option that can be issued by the buyer of a company to the sellers. It specifies an event, which, if triggered, lets the sellers acquire more shares in the target company. The New York Times claims[1]… …   Wikipedia

  • Contingent Value Rights - CVR — A type of right given to shareholders of an acquired company (or a company facing major restructuring) that ensures they receive additional benefit if a specified event occurs. A contingent value right is similar to an option because it often has …   Investment dictionary

  • Contingent Convertibles - CoCos — A security similar to a traditional convertible bond in that there is a strike price (the cost of the stock when the bond converts into stock). What differs is that there is another price, even higher than the strike price, which the company s… …   Investment dictionary

  • Common Stock Equivalent — Securities such as stock options, warrants, preferred bonds, two class common stock and contingent shares that can be converted into common stock. Sometimes preferred stock can also be converted to common stock. Also called common shares or… …   Investment dictionary

  • Convertible bond — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond …   Wikipedia

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  • Canada — /kan euh deuh/, n. a nation in N North America: a member of the Commonwealth of Nations. 29,123,194; 3,690,410 sq. mi. (9,558,160 sq. km). Cap.: Ottawa. * * * Canada Introduction Canada Background: A land of vast distances and rich natural… …   Universalium

  • Mutual fund — This article is about mutual funds in the United States. For other forms of mutual investment, see Collective investment scheme. A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors… …   Wikipedia

  • Russia — /rush euh/, n. 1. Also called Russian Empire. Russian, Rossiya. a former empire in E Europe and N and W Asia: overthrown by the Russian Revolution 1917. Cap.: St. Petersburg (1703 1917). 2. See Union of Soviet Socialist Republics. 3. See Russian… …   Universalium


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