extraordinary redemption

Extraordinary Redemption

A situation in which a bond issuer redeems a bond before its maturity because the revenue source paying the coupons disappears. For example, suppose a callable bond is issued to build a factory, and the revenue from the factory pays the interest on the bond. If the factory burns down, the company may redeem the bond at par so it no longer has to make interest payments. While the above example is catastrophic, most extraordinary redemptions occur for more mundane reasons; for instance, a mortgage-backed security may be extraordinarily redeemed if too many mortgages are refinanced. An extraordinary redemption is also called a special call.

extraordinary redemption

References in periodicals archive ?
Through our weekly surveillance of all rated money market funds, Standard & Poor's has not detected any extraordinary redemption activity taking place at the funds.
Bondholders bear the most risk from the gas supplier as the structure calls for an extraordinary redemption of bonds under most scenarios of nonperformance by any entity participating in the structure.
Bondholders bear the most risk from the gas supplier as the structure calls for an extraordinary redemption of bonds, under most scenarios of non-performance by any entity participating in the structure.
15, 2003 are subject to extraordinary redemption from 'available amounts' of excess city funds.
Aron (backed by the GSG guaranty) is obligated to make required payments to CPEP, which will be sufficient to cover debt-service payments and ultimately the payment of the extraordinary redemption along with funds in the reserve accounts.
The bonds will be subject to extraordinary redemption at par in the event of project destruction or condemnation if restoration cannot be completed or if the project cannot operate for six months.
The system is required to apply excess connection fees not needed for payment of debt service or replenishment of the debt service reserve for extraordinary redemption of parity bonds.
The bonds are subject to optional, mandatory and extraordinary redemption, as well as optional and mandatory tender for purchase.
The trust indenture between Wells Fargo Bank and PACE that outlines certain commitments to bondholders, including extraordinary redemption of the bonds in the event of an early termination of the gas purchase agreement for any reason and the payment of swap netting payments prior to debt service.
The trust indenture between The Bank of New York Trust Company and Main Street that outlines certain commitments to bondholders, including extraordinary redemption of the bonds in the event of an early termination of the gas purchase agreement for any reason and the payment of swap netting payments prior to debt service.
The bonds will be subject to extraordinary redemption at par in the event of project destruction or condemnation, if restoration cannot be completed or the project cannot operate for six months.
Bank National Association (Trustee) and SCPPA that outlines certain commitments to bondholders, including extraordinary redemption of the bonds in the event of any early termination of the prepaid natural gas sales agreements, for any reason, and the establishment of a debt service reserve fund that is sufficient to protect bondholders from a project participant default;

Full browser ?