Redemptions amount

For settlement amounts, real accrued interest is calculated as for ordinary OATs. Clean price and accrued are each multiplied by the Index Ratio to arrive at a cash settlement amount. For actual coupons paid, the (real) annual coupon rate is multiplied by the Index Ratio for the payment date, and likewise for the par redemption amount (with the cash value subject to a par floor). 

Real interest is accrued on a European 30/360 basis. To calculate settlement amounts, real accrued interest and clean price are multiplied by the indexation ratio for the settlement date, as for France s issues. Also, as in France, coupon and redemption amounts are calculated by multiplying the real value of the payment by the indexation ratio for the payment date. All five coupon-paying bonds pay on 1 December each year. 

Terms and Conditions of the bonds (the Ts Cs ) which are the most negotiated terms are usually those dealing with the negative pledge, which is a commitment by the issuer not to create a security interest senior to the bond over any collateral or not to issue debt senior to the bond, in the case of unsecured bonds description of the interest payable and redemption amount early redemptions (e.g., for tax reasons, puts and calls) withholding taxes and events of default. If the bond is part of a repackaging or a structured bond, the Ts Cs will also include a summary of the terms under which the security created for the benefit of the noteholders will be realised. 

IDNs have a number of variations. Some pay a variable coupon and a fixed redemption amount others pay a fixed coupon and a redemption amount that is determined by the level or performance of a reference index. Still other IDNs have payoff profiles linked to the difference between interest rates in two specified currencies or between rates for two different maturities in one currency. 

A bond is simply a long-term promissory note. It is a contract established between borrower and lender in a document called an indenture. A bond indenture includes a detailed description of assets that are pledged, together with any protective clauses and provisions for redemption. A trustee is appointed to look after the interest of the bondholders. The trustee is normally a commercial bank. Bonds may be issued with a call provision that enables a company to redeem its bonds at any date earlier than scheduled. Obviously, this would be an advantage to a company in times of falling interest rates. However, a company has to pay more than the par value of the bond for this privilege. The additional amount is called the bond premium. 

Nevertheless, we re seeing more state-level legislation pushing extended manufacturers responsibility. These proposals would require manufacturers to fund and operate redemption centers for a wide variety of packaging. Proponents of these bills argue that they will increase the amount of material recovered for recycling, but as the Eu-... 

To reach this minimum amount as soon as possible as well as to reduce the level of their liabilities, smoothen their debt s redemption profile or improve the liquidity of selected issues, many European Debt Agencies carry out bond exchange auctions and/or buybacks. These operations... 

A variety of credit-linked structures may be created to suit the various risk/reward profiles of investors. For example, some CLNs may protect the principal amount and credit events may only affect the interest cash flow from the CLN whereas others may link the redemption of principal to the performance of reference credit instruments. 

Free cash flow shows the residual payment flows available for debt redemptions. In the business year of 2000, this figure amounted to 2,384 million for Swissair. The book value of total debt is taken from the balance sheet and amounts to 18,863 million. FCF/TD is computed by dividing FCF by TD ... 

The Senior Notes shall be redeemed (in whole but not in part) by the Issuer at the direction of the holders of more than 50% of the aggregate principal amount outstanding as at the Final Closing Date of the Junior Notes. Any such redemption is subject to the following conditions (a) no such redemption may occur on any date other than an Interest Payment Date (b) other than as a result of the occurrence of certain tax events, no such redemption may occur prior to the end of the Reinvestment Period and (c) no optional redemption of the Senior Notes may occur unless there are sufficient proceeds to repay all the Senior Notes and any accrued and unpaid fees and expenses. 

A bond s term to maturity is crucial because it indicates the period during which the bondholder can expect to receive coupon payments and the number of years before the principal is paid back. The principal of a bond—also referred to as its redemption value, maturity value, par value, or face value—is the amount that the issuer threes to repay the bondholder on the maturity, or redemption, date, when the debt ceases to exist and the issuer redeems the bond. The coupon rate, or nominal rate, is the interest rate that the issuer agrees to pay during the bond s term. The annual interest payment made to bondholders is the bond s coupon. The cash amount of the coupon is the coupon rate multiplied by the principal of the bond. For example, a bond with a coupon rate of 8 percent and a principal of 1,000 will pay an annual cash amount of 80. 

Credit-linked notes are hybrid securities, generally issued by an investment-grade entity, that combine a credit derivative with a vanilla bond. Like a vanilla bond, a standard CLN has a fixed maturity structure and pays regular coupons. Unlike bonds, all CLNs, standard or not, link then-returns to an underlying asset s credit-related performance, as well as to the performance of the issuing entity. The issuer, for instance, is usually permitted to decrease the principal amount if a credit event occurs. Say a credit card issuer wants to fond its credit card loan portfolio by issuing debt. To reduce its credit risk, it floats a 2-year credit-linked note. The note has a face value of 100 and pays a coupon of 7.50 percent, which is 200 basis points above the 2-year benchmark. If more than 10 percent of its cardholders are delinquent in making payments, however, the note s redemption payment will be reduced to 85 for every 100 of face value. The credit card issuer has in effect purchased a credit option that lowers its liability should it suffer a specified credit event—in this case, an above-expected incidence of bad debts. 

Current pt. Current-pay bonds have been issued in Turkey. They are similar to interest-indexed bonds in that their redemption payments at maturity are not adjusted for inflation. They differ, however, in their term cash flows. Current-pay bonds pay an inflation-adjusted coupon plus an indexed amount that is related to the principal. In effect, they are inflation-indexed floating-rate notes. 

FIGURE 13.6 shows the terms of a hypothetical sterling synthetic convertible note linked to the FTSE 100 equity index. This note will pay par on maturity unless the FTSE 100 has risen by more than 10 percent from its level on the issue date. In that case, the redemption value will be par plus the amount of the index rise. The note also pays a coupon of 0.5... 

Investors rarely convert voluntarily. They may during an event such as a call or a tender offer, or if the share price has risen by a considerable amount. The main reason why early redemption is not generally in the investors interest is because it will erode the time value of the option element, as well as remove the yield advantage of holding the convertible. It also removes the downside protection afforded by the bond. That is... 

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