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Redemption Premium

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Redemption Premium
Money over and above the face value of a callable bond that the issuer pays to bondholders if the bond is called. A callable bond is a bond that the issuer is permitted to redeem or repay before the maturity date, depriving the bondholder of future coupon payments. Usually the issuer does this if it can reissue the same amount of debt at a lower interest rate. The redemption premium exists to compensate bondholders for some of their lost interest payments. It is especially useful if they can only reinvest in securities with a lower return rate. The redemption premium is also called the call premium.

redemption premium


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5% senior subordinated notes due in 2005, pay the related redemption premium and repay a portion of its existing bank debt.
05 per diluted share) will be recognized related to the redemption premium and the write-off of unamortized debt issuance costs.
05 per diluted share) will be recognized related to the redemption premium and the write-off of unamortized debt issuance costs.
 
 
 
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