What is Death Spiral Convertible?

Used by companies that are in such bad shape, that there is no other way to get financing. This instrument issimilar to a convertible bond, but convertible at a discount to the share price at issuance and for a fixed dollar amount rather than a specific number of shares. The further the stock falls, the more shares you get. Popular in the mid to late 1990s. Also known as toxic convertibles or floorless convertibles.