Patent ID: 7546260

Claim:
A computer-implemented method for supporting the issuance of convertible securities that are convertible into a quantity of an underlying security upon conversion by a holder of the convertible securities, the method comprising: calculating, by an electronic computer comprising a processor and a memory device, prior to issuance of the convertible securities, entries for a table data structure that establish an amount for a make-whole premium to be paid to the holders of the convertible securities in the event of a fundamental change involving the underlying security, wherein the make-whole premium is compensation that is payable to the holders of the convertible securities upon conversion of the convertible securities following occurrence of the fundamental change, wherein the make-whole premium is determinable from the table based on an effective date of the fundamental change and a consideration value involved in the fundamental change; wherein the fundamental change comprises one of (i) an acquisition, (ii) a merger, (iii) a takeover, (iv) an exchange offer, (v) a liquidation, (vi)a combination, (vii) a reclassification, (viii) a recapitalization, (ix) a consolidation, (x) a transaction in which a common stock of an issuer of the convertible security is exchanged for some consideration, (xi) a change of control occurring upon (a) a change in an ownership of the issuer's voting securities, (b) a change in a composition of the issuer's board of directors, or (c) an acquisition of more than a specified percentage of securities of the issuer, or (xii) sale or other disposition of all or substantially all of the issuer's and its subsidiaries'assets, properties, or businesses, wherein the calculating step further comprises computing the entries in the table based on a value of an option embedded in the convertible securities by: determining a series of theoretical convertible security prices using a convertible bond pricing model; subtracting from the theoretical convertible security prices the greater of (i) a principal amount of the convertible security and (ii) parity, wherein the calculating step further comprises receiving by the computer data inputs to the convertible bond pricing model comprising: a coupon rate of the convertible securities; a volatility assumption for the underlying security; and a conversion rate of the convertible securities.