Extract to table

Under ASU 2020-06, OWS is required to use the if-converted method for diluted earnings per share ("EPS") calculations for the Notes

The purpose of the Capped Call Transactions is to offset the potential dilution to the Common Stock upon conversion of the Notes or to offset any cash payments OWS is required to make in excess of the principal amount of converted Notes, in each case, up to a specified cap price

The sole remaining basis for bifurcating a convertible debt instrument is if the instrument contains an embedded feature that meets the definition of a derivative under ASC 815-10 and is required to be bifurcated under ASC 815-15

Under ASC 815-15-25-1, an embedded feature that, if freestanding, would meet the definition of a derivative must be bifurcated from the host contract unless an exception applies

This determination is fact-specific and must be made each reporting period

This is a counterintuitive result that is frequently a source of confusion for investors and must be prominently disclosed in the Offering Memorandum, the Company's periodic filings, and investor communications