Core terms
Convertible
Debt or preferred securities that can convert into common stock under fixed or variable-price terms, sometimes with floors, resets, accrued interest, premiums, or default adjustments.
Calculation framework
Fixed conversion shares ≈ (principal + convertible interest and fees) ÷ conversion priceVariable conversion price may equal max(floor, reference price × (1 − discount)); model multiple price scenariosWhat traders should verify
Verify principal outstanding, OID, interest, maturity, floor and reset mechanics, conversion notices, blockers, exchange caps, collateral, defaults, and actual shares issued.
Do not conflate
Low-price scenarios can expand share counts sharply, but theoretical capacity is not proof that conversion occurred.