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Special maturity ASR recalculated timing

  • US 7,827,096 B1
  • Filed: 11/05/2007
  • Issued: 11/02/2010
  • Est. Priority Date: 11/03/2006
  • Status: Active Grant
First Claim
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1. A method of providing a company with a large quantity of stock shares issued by the company by borrowing the large quantity of shares from a lender and gradually repurchasing small quantities of the shares from the market in order to settle with the lender, the method comprising:

  • receiving, from the company, a request for a first quantity of shares issued by the company;

    communicating, to the company, at least one dividend limit associated with the shares;

    communicating, to the company, a maturity window consisting of a start maturity date and an end maturity date, the maturity window being subject to change upon the at least one dividend limit associated with the shares being exceeded;

    receiving, from the company, compensation associated with a second quantity of shares issued by the company;

    borrowing, from at least one lender, the second quantity of shares issued by the company;

    conveying the second quantity of shares to the company;

    purchasing a plurality of quantities of the shares at market value;

    detecting that one or more ordinary dividends associated with the shares and declared by the company exceeds the at least one dividend limit;

    computing, using a computer, a value of an outstanding transaction with the company, the outstanding transaction comprising a potential revised maturity date;

    setting, as a consequence of said detecting and based on the computing, a revised maturity date outside of the maturity window;

    calculating a settlement number of shares as a difference between (1) a number of shares corresponding to the compensation and an average share value and (2) the second quantity of shares, wherein the average share value is determined over a time period associated with the revised maturity date;

    compensating the company if the settlement number of shares is negative;

    receiving compensation from the company if the settlement number is positive; and

    settling with the at least one lender.

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