High Frequency Traders In A Hurry To Get In And Out Of Knight Shares

The Knight Capital convertible preferred documentsare a mess. The basic structure is quite nice: Knight’s new investors are getting a preferred stock that, eliding the details below, pays a 2% dividend, converts into common at $1.50 a share, automatically converts once the common has traded above $3 for 60 days, and can be converted earlier at the holder’s option. Sensible enough: the holdersget a liquidation preference if the company goes belly-up in the next few weeks; otherwise they get common that they can get out of quickly via an already-filed registration statement.

About these ads
This entry was posted in Articles, Breaking News, Business, Events, Finance, Practitioners and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s