CRAM-UP
Situation in which junior classes of creditors impose a cram-down on senior classes of creditors in the event of bankruptcy or reorganization. A firm facing bankruptcy cannot force creditors to take compromises to their claims beyond the courtroom, but the creditors may agree to the terms. If there are sufficient number of junior class creditors that agree on the set terms by the firm seeking refinancing, they can force holdouts that are bounded to the agreement. Senior classes of creditors will be forced to accept the terms even though it is not better than the initial deal.
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Asset Substitution Problem
A problem which arises when a company trades its low-risk assets for high-risk investments. This substitution moves the value from the bondholders ...
Lawful Money
Any currency, in coin or paper form, that is issued by the United States Treasury, not the Federal Reserve System. It also includes gold and silver ...
Red Clause Letter Of Credit
It refers to a specific type of letter of credit where a buyer extends an unsecured loan to a seller. This permits documentary credit beneficiaries ...
Trust Certificate
Bond or debt investment backed by other assets and serve like a collateral. Normally in a public company, the assets may be seized or sold for the ...
Cowboy Marketing
Slang term for a situation in which a firm is unaware a marketer sends massive spam emails to everyone promote the stock, instead of producing legi ...
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Ethical Investing: Knowing Human Rights and Workers` Rights
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