Academic Research on Anti-Dilution Protection

• Equityissues and offeringdilution, Asquith, P., & Mullins Jr, D. W. (1986). Journal of financial economics,15(1-2), 61-89. This study looks at how equity offerings can affect stock prices. Regression models are used to examine price changes after announcements of equity offerings. The authors results show that investors generally take a negative view of equity offerings, and this is reflected in the share price.
• Brandequity dilution: retailer display and context brand effects, Buchanan, L., Simmons, C. J., & Bickart, B. A. (1999). Journal of Marketing Research, 345-355. This research shows that a retailers decisions when creating displays can have an enormous effect on the perception of a brand. This effect is strong enough that it can even undo all the efforts of a manufacturers marketing plan. Different display approaches for a varied selection of products are discussed.
• The effect of convertible bondequityvalues ondilutionand leverage, King, R. D. (1984). Accounting Review, 419-431. A contingent claims valuation model is used by the authors to find the value of debt and equity in a selection of convertible bonds. By using these figures while measuring leverage and dilution, the author finds how these values affect earnings per share.
• Dividends,dilution, and taxes: A signalling equilibrium, John, K., & Williams, J. (1985). the Journal of Finance,40(4), 1053-1070. This paper demonstrates the inter-related nature of dividend disbursement, dividend taxes, and share price.
• Managing brandequity., Farquhar, P. H. (1989). Marketing research,1(3). Brand equity is a relatively new and powerful asset, and this paper allows the author to define this valuable element. The author focuses on how to build strong brands, how to maintain that brand over time, and how to leverage brand equity to protect and grow a business.
• Understanding brandequityfor successful brand extension, Pitta, D. A., & Prevel Katsanis, L. (1995). Journal of consumer marketing,12(4), 51-64. Brand extension is a method that can allow a company to leverage their brand equity to grow their business. This paper examines the dynamic markets of the 1990s to show how the frequent practice of brand extension was used. The authors point out the strengths and weaknesses of this practice. Analysis of the brand extension is offered and recommendations on best practices are made.
• Branddilutioneffect of extension failurea Taiwan study, Cheng-Hsui Chen, A., & Chen, S. K. (2000).Journal of product & brand management,9(4), 243-254. This research uses data gathered from Taiwanese college students to show a failed attempt at brand extension can have negative effects on the original brand. Four different hypotheses are offered, and they find that an unsuccessful brand extension dilutes the original brand in a variety of ways.
• Why do managers avoid EPSdilution? Evidence from debtequitychoice, Huang, R., Marquardt, C. A., & Zhang, B. (2014). Review of Accounting Studies,19(2), 877-912. This research offers a variety of scenarios in which managers may choose to not dilute their companys earnings per share (EPS). The role that EPS plays in compensation is examined. Differences in corporate culture, attitudes toward debt, and overall speed at adapting to changing leverage ratios are also cited as factors that affect the decision-making process regarding EPS dilution.
• Equity dilution: an alternative perspective on mortgage default, LaCourLittle, M. (2004). Real Estate Economics,32(3), 359-384. This research attempts to find the real levels of leverage that are experienced by households experiencing mortgage default. This paper uses an independent estimate of junior liens combined with loan performance data to find the role that these junior liens play when increasing the risk of default.
• Warrant pricingIsdilutiona delusion?, Sidenius, J. (1996).Financial Analysts Journal,52(5), 77-80. This research examines the real effects that warrant pricing has on the total equity value of a firm. Pricing models are used to establish pricing in those approaches with and without the use of warrants.
• Earnings growth: The two percentdilution, Bernstein, W. J., & Arnott, R. D. (2003). Financial Analysts Journal,59(5), 47-55 This paper uses two different methodologies to illustrate a pair of flawed concepts that played a key role in the bull market of the 1990s. The authors suggest that misconceptions about earnings growth in relation to GDP and the role of stock buybacks in earnings growth contributed to rapid rates of growth around the world.
• Privateequityin the developing world: The determinants of transaction structures, Lerner, J., & Schoar, A. (2003). Unpublished working paper, MIT. This paper examines the challenges faced by private equity funds when trying to allocate capital in the developing nations around the world. The authors focus on the type of transaction structures used by private equity funds. By using data from 167 different transactions, they analyze the many deal structures to see how they change in response to the nature of the various countries involved.
• Anti-DilutionProvisions in Convertible Securities, Kahan, M. (1995). Stan. JL Bus. & Fin.,2, 147. This paper analyzes 49 convertible bonds issued in 1993 to demonstrate the different types of anti-dilution provisions put in place to protect security holders against this practice. The rationale and effectiveness of these various policies and practices are examined.
• Understanding anti-dilutionprovisions in convertible securities, Woronoff, M. A., & Rosen, J. A. (2005).Fordham L. Rev.,74, 129. This paper helps to provide a basic framework that introduces readers to anti-dilution provisions. The authors define the provisions, and demonstrate a number of different methods that these provisions are employed. Apparent inconsistencies in the policies are also explained.
• Trademarkdilutionand the practice of marketing, Peterson, R. A., Smith, K. H., & Zerrillo, P. C. (1999). Journal of the Academy of Marketing Science,27(2), 255-268. This article takes a look at the future of marketing and the resulting influence of the Federal Trademark Dilution Act (FTDA) of 1995. This piece of legislation was an amendment to the Lanham Act, and it was designed to protect trademarks from having their distinctiveness diminished or their positive associations tarnished by similar trademarks.
• Quantifying brand image: Empirical evidence of trademarkdilution, Magid, J. M., Cox, A. D., & Cox, D. S. (2006). American business law journal,43(1), 1-42. This article examines a number of legal precedents related to trademark dilution. The authors refer to more than 50 years of U.S. court cases to provide context for the history and interpretation of the practice of trademark dilution.
• Investorprotectionand the mode of acquisition: Implications for ownershipdilutionand formation of pyramids, Kim, W. (2012Financial Management,41(1), 55-93. This paper examines how the method mergers and acquisitions can be affected by the level of investor protection in a firm. The author suggests that stock-based mergers are more likely when the investors have greater protection, and that cash-based transactions are more common when the investors experience weaker protection.
• Management andProtectionof BrandEquityin Product Configurations, Davis Jr, T. H. (1998).U. Ill. L. Rev., 59. The author examines brand equity with a focus on the relatively new subject of trade dress. He takes a look at current civil cases to see how the idea of trade dress, or the exterior configuration of a products appearance or packaging, as they are addressed by the Lanham Act, local courts, and even the Supreme Court.
• Protectionin the United States for Famous Marks: The Federal TrademarkDilutionAct Revisited, Vassallo, E. E., & Dickey, M. (1998). Fordham Intell. Prop. Media & Ent. LJ,9, 503. The author takes a broad, historical approach to looking at how trademarks have been treated in the US patent and legal system. This article provides both basic and in-depth information to familiarize the reader with the concept and protections of trademark dilution.
• Defining and quantifyingdilutionunder the Federal TrademarkDilutionAct of 1995: Using survey evidence to show actualdilution, Bible, P. M. (1999).U. Colo. L. Rev.,70, 295. This work begins with a historical discussion of how trademarks were recognized and protected under law before the institution of the Trademark Dilution Act of 1995. An examination of that act follows. A survey is used to provide concrete evidence of how trademark dilution happens and how it affects the affected producers and the marketplace as a whole.
• Executive Compensation and Corporate Governance in Financial Firms: The Case for ConvertibleEquity-Based Pay, Gordon, J. N. (2010). This paper proposes a new system of executive compensation that takes into account the different forces at work in financial firms that play a more significant role in the financial system. The author argues that a compensation that steers executives away from excessive risk-taking may be wisest plan for long-term stability and shareholder security.