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A PIK Loan is a type of loan which typically does not provide for any cash flows from borrower to lender between the drawdown date and the maturity or refinancing date, not even interest or parts thereof (see mezzanine loan), thus making it an expensive, high-risk financing instrument. PIK (payment in kind) is to be interpreted as interest accruing until maturity or refinancing. PIK loans are typically unsecured (ie. not backed by a pledging of assets) or with a deeply subordinated security structure (e.g., third lien). Maturities usually exceed five years and in a standard offer, the loan carries a detachable warrant (the right to purchase a certain number of shares of stock or bonds at a given price for a certain period of time) or a similar mechanism to allow the lender to share in the future success of the business, making it a hybrid security. From Wikipedia under the
GNU Free Documentation License From Yahoo Image Search: "PIK loan"  news.google.com Wall Street Journal ... loan and a 48 million senior revolver, and wipes out the previous second-lien tranche. A 300 million payment in kind, or PIK , completes the financing. ... PAI Loses Invest As Lenders Take Control Of Monier Wall Street Journal all 10 news articles » news.google.com Business Wire (press release) Accrued PIK interest will be added to the principal balance of the term loan on a monthly basis and paid at maturity. The company estimates that as a result ... and more » news.google.com Irish Times ... who provided the broadcaster's failed parent company Setanta Sport Holdings with 225 million in payment-in-kind ( PIK ) loan notes. ... and more » From Google News Search: "PIK loan"  wpmiblog.com Jim Sun, 03 May 2009 04:08:45 GM If you are applying for a . loan. , credit card or mortgage, it is normal for the agency to check your credit worthiness. This is essentially based on the assessment of your credit history, thus helping them determine the possible risks of ...  fairpointverizon.blogspot.com Concerned consumer Sun, 11 Feb 2007 14:21:00 GM The unsecured . loan. , which matures in 2012, gives EB Sports the option of paying interest either in cash or in-kind, by adding the interest to principal. With the . PIK. structure and new debt being issued at the holding company level, ...  quickcashloansinuk.blogspot.com John Smith hu, 16 Apr 2009 04:42:00 GM Broadcasters may turn to what Begley called distressed debt exchanges to stay within the leverage ratios of their . loan. agreements. One debt exchange is known as . PIK. , or payment-in-kind, which provides investors with bonds or preferred ... From Google Blog Search: "PIK loan" |
