Section 7-2D-9 - Special rules for options, warrants and certain convertible investmentsA. In the case of stock that is acquired by the taxpayer through the exercise of a nontransferable option or warrant issued in exchange for the performance of services for the corporation issuing it, through the conversion of convertible debt or in exchange for securities of the corporation in a transaction described in Section 368 of the Internal Revenue Code: (1) the stock shall be treated as acquired by the taxpayer at original issue; and(2) the stock shall be treated as having been held during the period that the option, warrant or debt was held or that the security was outstanding.B. For purposes of Subsection A of Section 7-2D-5 NMSA 1978 and notwithstanding Subsection B of that section, in the case of a debt instrument converted to stock or stock issued in exchange for securities in a transaction described in Section 368 of the Internal Revenue Code, such stock shall be treated as issued for an amount equal to the sum of: (1) the principal amount of the debt or security at the time of the conversion or exchange; and(2) accrued but unpaid interest on that loan or security.Laws 1993, ch. 313, § 9; 1995, ch. 89, § 9.