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Public Finance Matters Updates on recent public finance and municipal bond developments

Tag Archives: acceleration

Federal Appellate Court Rules That Post-Acceleration Payment in Bankruptcy Constitutes Optional Redemption

Posted in Bankruptcy

By LEN WEISER-VARON The linked Mintz Levin client advisory discusses a recent Third Circuit Court of Appeals ruling that held a “make-whole” optional redemption premium to be due upon a refinancing of corporate debt following its automatic acceleration upon bankruptcy. As noted in the linked advisory, the Second Circuit Court of Appeals also is considering this issue;… Continue Reading

Court Rules on Applicability of Make-Whole Premiums Upon Debt Acceleration

Posted in Bankruptcy, Financing Structures

BY LEN WEISER-VARON The linked Mintz Levin client advisory, which discusses a recent bankruptcy court ruling regarding the applicability of a make-whole premium upon a refinancing of corporate debt following such debt’s automatic acceleration upon bankruptcy under the terms of the governing documents, may also be of interest to holders of municipal bonds with call… Continue Reading

Legal Highlights in Puerto Rico’s “Draft POS” for Upcoming General Obligation Bond Issue

Posted in State Law

By LEN WEISER-VARON and BILL KANNEL Although Puerto Rico’s much-discussed sub-investment grade general obligation bond issue is not yet being marketed via an official preliminary official statement, it appears that a draft POS has been making the rounds.  The draft POS, dated February 28, 2014, has been posted on at least one website and has… Continue Reading

Second Circuit Rules Against Make-Whole Premium for Refinancing of Accelerated Debt

Posted in Bankruptcy

By LEN WEISER-VARON The U.S. Court of Appeals for the Second Circuit has upheld a bankruptcy court’s decision enforcing indenture language providing for the automatic acceleration, without make-whole premium, of secured American Airline, Inc. notes upon American Airline Inc.’s bankruptcy filing.  The Second Circuit’s September 12 opinion generally follows that of the lower court, discussed in… Continue Reading

AMR Decision Highlights Bankruptcy Court Split on Enforceability of Ipso Facto Clauses

Posted in Bankruptcy

By LEN WEISER-VARON  A recent ruling in the American Airlines bankruptcy case enforcing an automatic acceleration upon bankruptcy provision serves as a reminder that the enforceability of so-called ipso facto provisions in debt instruments remains an unsettled, forum-dependent question.       In the American Airlines case, the question of the enforceability of an automatic acceleration upon… Continue Reading