Jurisdiction and PIK notes: Difference between pages

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1. ''Law''.
PIK notes are debt instruments based on non-cash payment of interest coupons.


The legal authority of a court to try cases and rule on legal matters within a particular geographic area and/or over certain types of legal cases.
Interest is usually recognised by an increase in the amount of principal owed by the borrower.


Jurisdiction is very important for the practical enforceability of legal rights, for example contractual rights.


PIKs are generally either unsecured loans or deeply subordinated securities ranking just before equity in the capital structure.


This means that, in the event of a bankruptcy, PIKs are the last debts to be repaid, making them a high risk instrument for lenders and investors.


2.
In order to compensate lenders for the risk, PIKs have to offer significantly enhanced rates of return to investors.
 
Similar legitimate rights enjoyed by law enforcement agencies, for example the police of a particular state.
 
 
3.
 
The geographical or other area which is subject to a particular legal system or the authority of its law enforcement agencies, or more usually both. 
 
For example, a country.
 
 
4.
 
In relation to tax, a geographical or other area which is subject to a particular tax system or its tax authorities, or both. 
 
For example, a country or a state, or indeed any authority which has legitimate powers to levy tax.




== See also ==
== See also ==
* [[Capacity]]
* [[Coupon]]
* [[Court]]
* [[Equity]]
* [[Governing law]]
* [[Interest]]
* [[Regime]]
* [[Notes]]
* [[Repatriated]]
* [[Payment in kind]]
* [[Resident]]
* [[Principal]]
* [[State]]
* [[Secured debt]]
* [[State immunity]]
* [[Subordinated debt]]
 
* [[Unsecured debt]]
[[Category:Compliance_and_audit]]

Revision as of 16:27, 22 August 2017

PIK notes are debt instruments based on non-cash payment of interest coupons.

Interest is usually recognised by an increase in the amount of principal owed by the borrower.


PIKs are generally either unsecured loans or deeply subordinated securities ranking just before equity in the capital structure.

This means that, in the event of a bankruptcy, PIKs are the last debts to be repaid, making them a high risk instrument for lenders and investors.

In order to compensate lenders for the risk, PIKs have to offer significantly enhanced rates of return to investors.


See also