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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsTrump Organization Charges Magnify Risks of Debt Refinancing
TFG has a ton of debt that needs to be refinance and this indictment will make the refinancing of that debt more difficult https://www.bloomberg.com/news/articles/2021-07-01/trump-organization-charges-magnify-risks-of-debt-refinancing
Now, in the latest twist, the business and its longtime Chief Financial Officer Allen Weisselberg, 73, are facing charges relating to tax crimes. The exact charges Weisselberg is facing will be unsealed on Thursday, but are expected to involve unpaid taxes on benefits extended to him. The move by Manhattan District Attorney Cyrus Vance could have long-term repercussions on Trumps ability to keep the business afloat and refinance debt.....
Commercial loan covenants dont typically mention criminal charges in part because theyre such a rarity for businesses, but also because charges are just that -- charges, not convictions, according to professor Adam Levitin at Georgetown University, who specializes in bankruptcy and commercial law.
A spokesman for Deutsche Bank AG, a favored lender for the Trump Organization, declined to comment on how the charges may impact the loans they have coming due.
Even if the loan documents dont speak directly to criminal charges, sophisticated lenders -- and their lawyers -- can find a way to push the issue. Federal courts are no stranger to lengthy, expensive fights over what gives rise to defaults under commercial lending agreements.
Regardless of the specific provisions in loan documents, when a lender wants to cut ties with a corporation thats in trouble -- particularly in trouble with the law -- the lender will often find a way to call a default and get out of dodge, said David Prager, a restructuring and financial adviser at Kroll, who wasnt speaking about the Trump situation specifically.
It may also be harder to find banks willing to refinance the debt down the road -- most banks would balk at extending a loan to a company subject to a criminal indictment.
Commercial loan covenants dont typically mention criminal charges in part because theyre such a rarity for businesses, but also because charges are just that -- charges, not convictions, according to professor Adam Levitin at Georgetown University, who specializes in bankruptcy and commercial law.
A spokesman for Deutsche Bank AG, a favored lender for the Trump Organization, declined to comment on how the charges may impact the loans they have coming due.
Even if the loan documents dont speak directly to criminal charges, sophisticated lenders -- and their lawyers -- can find a way to push the issue. Federal courts are no stranger to lengthy, expensive fights over what gives rise to defaults under commercial lending agreements.
Regardless of the specific provisions in loan documents, when a lender wants to cut ties with a corporation thats in trouble -- particularly in trouble with the law -- the lender will often find a way to call a default and get out of dodge, said David Prager, a restructuring and financial adviser at Kroll, who wasnt speaking about the Trump situation specifically.
It may also be harder to find banks willing to refinance the debt down the road -- most banks would balk at extending a loan to a company subject to a criminal indictment.
This will be fun to watch
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Trump Organization Charges Magnify Risks of Debt Refinancing (Original Post)
LetMyPeopleVote
Jul 2021
OP
Kurt Eichenwald has some good observations about the effect of this indictment on the trump org
LetMyPeopleVote
Jul 2021
#3
ProudMNDemocrat
(16,783 posts)1. Those $400 million Orange Anus has coming due...
Must be adding to his diaper load. Borrowing from Petet. Paul, and Mary to pay Thomas, Matthew, and Frank has to be exhausting.
But none the less fun.
Orrex
(63,199 posts)2. Maybe he'll suffer a massive stroke due to stress
Maybe itll leave him fully aware but immobile for the rest of his already far-too-long life.
LetMyPeopleVote
(145,086 posts)3. Kurt Eichenwald has some good observations about the effect of this indictment on the trump org
Kurt does not see how the Trump Org survives this without some sort of corrupt deal overseas. I tend to agree
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