Mini case financing east coast yachts s expansion plans with a bond issue

If the company benefits from the provision of the bond, then the coupon rate will be higher. It provides an asset which lowers default risk.

Mini case financing east coast yachts s expansion plans with a bond issue

She would also like you to list any advantages or disadvantages of each feature. The security of the bond, that is, whether or not the bond has collateral.

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The seniority of the bond. The presence of a sinking fund. A call provision with specified call dates and call prices. A deferred call accompanying the above call provision.

Mini case financing east coast yachts s expansion plans with a bond issue

A make-whole call provision. Also, discuss several possible positive covenants East Coast Yachts might consider. Also, discuss several possible negative covenants East Coast Yachts might consider.

A conversion feature note that East Coast Yachts is not a publicly traded company. A floating rate coupon.

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Dan is also considering whether to issue coupon bearing bonds or zero coupon bonds. The YTM on either bond issue will be 7. The coupon bond would have a 6. How many of the zeroes must it issue? In 20 years, what will be the principal repayment due if East Coast Yachts issues the coupon bonds?

What if it issues the zeroes?

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Suppose East Coast Yachts issues the coupon bonds with a make-whole call provision. The make-whole call rate is the Treasury rate plus. If East Coast calls the bonds in seven years when the Treasury rate is 4.

Mini case financing east coast yachts s expansion plans with a bond issue

What if it is 8. Are investors really made whole with a make-whole call provision? After considering all the relevant factors, would you recommend a zero coupon issue or a regular coupon issue?

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Would you recommend an ordinary call feature or a make-whole call feature? Browse hundreds of Finance tutors.Download-Theses Mercredi 10 juin Port Manteaux churns out silly new words when you feed it an idea or two. Enter a word (or two) above and you'll get back a bunch of portmanteaux created by jamming together words that are conceptually related to your inputs..

For example, enter "giraffe" and you'll get . View Mini Case - Chapter 8 from FINC at Rochester Institute of Technology. Chapter 8 Financing East Coast Yachts Expansion Plans with a Bond Issue Input area: Years to maturity Required80%(5).

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Many thanks to Hermes for the translation from r-bridal.com Contents CHAPTER I Introduction to Corporate Finance I. I What Is Corporate Finance? The Balance Sheet Model of the Firm The Financial Manager The Corporate Firm.

Corporate Finance: Chapter 5: Financing East Coast Yacht’s Expansion Plans with a Bond 1. If the company benefits from the provision of the bond.

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