Articles

Research on Intentional Default and Enforceability of Prepayment Premium

Author: LegalEase Solutions  Introduction A bond is issued in exchange for $1,000.  Issuer must pay the bondholder a certain percent each year until maturity, whereupon the bondholder gets the $1,000 back.  The issuer may pay back the bond early (before maturity), but because that would extinguish the bondholder’s steady stream of interest income, the parties … Continue reading “Research on Intentional Default and Enforceability of Prepayment Premium”

The Law of “Change in Control” Provisions in Bonds

Author: LegalEase Solutions Introduction The development of “change of control” provisions in bonds can be traced to the much publicized bondholder losses in the RJR Nabisco leveraged acquisition in 1988. [1] A “change of control” covenant states “that if a specified takeover-related event occurs, bondholders will either have the right to ‘put’ their bonds back to … Continue reading “The Law of “Change in Control” Provisions in Bonds”

Research on Law Relating to Interpretation of Bond Indentures I – New York

Author: LegalEase Solutions Introduction Our client, a New York Attorney, specializing in interpreting bond indentures for investors, would like to know how New York courts interpret specific restrictive clauses in bond indentures included to secure the interests of the bondholders.  Our client requires case law interpreting the clause: “The Company will not, and will not … Continue reading “Research on Law Relating to Interpretation of Bond Indentures I – New York”

Research on Law Relating to Interpretation of Bond Indentures II – New York

Author: LegalEase Solutions Introduction How courts would interpret law relating to bond indenture. The Indenture has a definition of Senior Debt, which explicitly excludes: “any accounts payable or other liability to trade creditors arising in the ordinary course of business.” Because of the lack of commas, there is an ambiguity as to what the phrase … Continue reading “Research on Law Relating to Interpretation of Bond Indentures II – New York”