Equity Based LoansShare-based loans
What is the difference in P2P credit allocation? So does this necessarily make credit-based crowdfunding financing a more secure one? Decisions have stringent verification processes with regard to borrower, and who is eligible for a credit and who is not. None of the lenders at Credit Works has ever dropped a cent, and that goes for many other UK P2Ps.
Significantly, equity-based crowdfunding is already subject to different taxation than P2P loans.
Tribunal orders the disposal of equity securities on the basis of the lender contract interpreted.
New York State Courts recently approved the claim of Bank of America, N.A. (Bank of America) and U.S. Bank National Association for a restraining order prohibiting the respondent PSW NYC LLC (PSW) from purchasing or reselling certain equity securities without first making payment to the claimants of the principal amount due to them under a prior debt facility in relation to the funding of the purchase of the residential projects known as Peter Cooper Village and Stuyvesant Town.
Bank of America, N.A., et al. v. PSW NYC LLC, No. 651293, 2010 WL 4243437 (N. Y. Co. Co. Co. ^Sept. 16, 2010), the Courts found that the interim lender agreement related to the loans was clear and that the plaintiff definition provided that the lender priorities should be fully repaid before the purchase or disposal of the securities.
Mr Tilman funded the deal with a senior facility of $3 billion and 11 junior loans of $1.4 billion. Senior loans were funded by Mr. Thomas through various affiliates (the "borrowers") who received the $3 billion loans from Wachovia Bank, N.A. (Wachovia) and Mortgage Lending, Inc. "with Wachovia, the Senior Lenders."
As part of this funding, borrowers provided six bonds totalling $3 billion (the "Bonds") retained in a trustee relationship in which the claimants were fiduciaries. Borrowers provided the senior lenders with collateral for the property. $1.4 billion of junior loans comprised 11 meszanine loans originated by junior lenders in return for pledged shares of the borrower's parents (the "junior borrowers") in the borrowers and their general partner each.
However, the prioritization of juvenile loans was sequent with juvenile 1 loans the oldest and juvenile 11 loans the youngest. Loans 1-3 for juniors each had an initial nominal value of USD 100 million. Junovia and Merrill were among others the initial lenders among juniors in 1-3 credits.
In accordance with special pledge and collateral agreements, each junior lender received a senior interest in the participation of its corresponding junior borrower in its corresponding affiliate borrower or junior borrower and its general partner at equity collateral. Wachovia and Merrill, in their capacity as senior and junior lenders, have concluded an intercreditor agreement in relation to these financing arrangements.
The debtors fell into arrears with the notes on 8 January 2010. The applicant Bank of America, through its special servicer CWCapital Asset Management LLC (CWCAM), sent the borrower a letter of formal indebtedness requiring the borrower to repay all principal overdue. CSWCAM also informed the junior lenders of the failure that the junior lenders were required to remedy under the Intercreditor Agreement.
No junior lender reportedly made use of these curative powers. As a result, CWCAM informed both the borrowers and the junior lenders that, as the failure had not been remedied, all unsettled debts under the bonds were expedited and immediately due. CWCAM lodged a petition on 16 February 2010 in the Southern District of New York on its behalf in the name of the Senior Lenders to seek enforcement of the property.
The Southern District of New York issued a $3,666,734,464 judgment on the foreclosure and disposal of the property on June 21, 2010, representing the amount due under the Notes and related senior debt documentation. Wells Fargo, the Wachovia replacement, informed Senior Lenders on 6 August 2010 that it had assigned its stake in Junior Loans 1-3 to PSW, a "qualified acquirer" under the Intercreditor Agreement.
Simultaneously, PSW has created a "Representation Certificate" which is linked to the Intercreditor Agreement regarding Junior Loans 1-3. PSW informed senior lenders on 7 August 2010 that it intends to divest the equity collateral in a UCC deal and issued a Notice of Publicized Sale-Of-Sale for Junior Loans 1-3 in the New York Times with a date of divestiture of 25 August 2010.
Responding to this, the senior lenders asked PSW to confirm that it would, in accordance with Section 6(d) of the Intercreditor Agreement, remedy the loss of the senior loan as a requirement for the purchase or assignment of the equity collateral. If a Qualifying Acquirer purchases the Equity Collateral secured to a Junior Lender under the Junior Loan Documents in accordance with the terms and performance of this Agreement (including, but not restricted to, Section 12 of this Agreement), such Qualifying Acquirer will purchase the same provided that (i) the Senior Loan and the Performance Indicators,
For the remainder of the Loan Period, the Senior Loan Documents and (ii) the Senior Junior Loans and the Senior Junior Loan Documents, each for the duration of the Loan Period not expedited exclusively by the Senior Lender's or the related Senior Junior Lender's purchase and remaining in full effect;
provided that (A) within ten (10) business days following the date of assignment, the Qualifying Transferee must confirm in written form (1) the Mortgagor and (2) the relevant Senior Junior Borrowers, all senior loan documents and related Senior Junior Loan Documents attached thereto, to the Mortgagor or to the relevant Senior Junior Borrower's, provided that the Mortgagor and the relevant Senior Junior Borrowers are bound by the relevant Senior Loan Documents and related Senior Junior Loan Documents, and provided that (A) the Qualifying Transferee must confirm in written form to the Mortgagor or to the relevant Senior Junior Borrower's all senior loan documents and related Senior Junior Loan Documents, as the case may be, all senior loan documents and related Senior Junior Loan Documents, as the case may be, shall be valid,
i) a statement of its interests under the Intermediary Loan Agreement; and ii) an injunctive covenant that prevents PSW from purchasing or disposing of the Collateral without first making the payment of the principal amount due to the Senior Loan claimants and initiating insolvency proceedings while the Senior Loan is principal receivable. Furthermore, the applicants applied for an interim order requiring the disposal of the equity securities and the start of insolvency proceedings on grounds of justification.
Notwithstanding, the Supreme Court agreed to the plaintiffs' request for injunctive relief prohibiting PSW from obtaining or disposing of the equity collateral without first paying all of the debt owed (in excess of $3,666,000,000,000) on the Senior Loan. However, the CFI has made the decision conditional upon the claimants issuing a CPLR 6312 loan in the amount of $4,500,000 (the uncontested amount at which PSW Junior Loans bought 1-3).