Mezzanine capital can be issued in a similar way to equity capital (what is termed ‘equity mezzanine’) in the form of special dividend rights, special dividend right shares certified with securities or dormant equity interests. Other possibilities are afforded in the form of convertible loan stock and option loans. On the other hand, mezzanine capital that is issued in the form of loans that are lower in rank or at par, or from shareholders’ loans, is classified as ‘outside capital’, and must be recorded as a liability on the balance sheet (what is termed ‘debt mezzanine’).

The forms in which mezzanine capital can be constituted are not regulated by law, or only minimally regulated, and so flexible and optimal financing solutions are possible, for example, as far as currency periods, cancellation options, profit and interest conditions and repayment methods are concerned. Mezzanine capital can also be deployed in the context of staff profit-sharing schemes.