What is that? In-substance defeasance not extinguishment???

  • This topic has 0 replies, 1 voice, and was last updated 14 years ago by Anonymous.
  • Creator
    Topic
  • January 24, 2012 at 8:19 pm #165524
    Anonymous
    Inactive

    Can someone explain this to me in plain English?…Is it me (English as my second language) or it’s written by aliens?

    In-substance defeasance not extinguishment – (chapter 5 FAR-Becker)

    An in-substance defeasance is an arrangement where a company places purchased securities into an irrevocable trust and pledges them for the future principal and interest payments on it’s long-term debt. Because the company remains the primary obligor while there is outstanding debt, the liability is not considered extinguished by an in-substance defeasance.

  • The topic ‘What is that? In-substance defeasance not extinguishment???’ is closed to new replies.