Kicillof Pays To 92% Of Bondholders, Griesa's Move Now?

[French jurist]

Please explain the meaning of pari passu in the below Argentine documents, if you think it differs from judge Griesa's interpretation.
- - -
1. Original prospectus for Argentina’s 2005 debt exchange.

p.27.

"Further Issues ...........
Argentina may, from time to time without the consent of holders of the New Securities governed by New York law or English law, create and issue additional debt securities ranking pari passu with the New Securities and having the same terms and conditions as any series of the New Securities, or the same terms and conditions except for the amount of the first payment of interest on such additional debt securities.

Seniority ...........
New Securities governed by New York law or English law will be direct, unconditional, unsecured and unsubordinated obligations of Argentina, and will rank pari passu and without preference among themselves and at least equally with all of Argentina's other present and future unsecured and unsubordinated External Indebtedness"
- - -
2. Original prospectus for Argentina’s 2010 debt exchange.

p.54.

"Further Issues.................................
Argentina may, from time to time without the consent of holders of the New Securities governed by New York law or English law, create and issue additional securities ranking pari passu with the New Securities and having the same terms and conditions as any series of the New Securities, or the same terms and conditions except for the amount of the first payment of interest or other amounts on such additional securities, or, if applicable, the initial interest or other payment date or interest accrual date.

Seniority...........................................
New Securities governed by New York law or English law will be direct, unconditional, unsecured and unsubordinated obligations of Argentina, and will rank pari passu and without preference among themselves by reason of priority of date of issue or currency of payment or otherwise, and at least equally with all of Argentina’s other present and future unsecured and unsubordinated External Indebtedness"

Sorry for posting a link, but the author describes -obviously- better the issue than I would (and he has more diplomas than I do too).
http://opiniojuris.org/2014/05/08/pari-passu-clauses-alternative-interpretation/

Mainly a question of wording: "rank"/"ranking"

 

[Matiasba]

Absolutely! No newly elected government should be hampered by any convention, agreement, obligation, debt, etc. left over from an earlier government.

As for corruption, it's easy to see that Argentina isn't really corrupt.
Look! it's rank is 106 on the corruption index (the US has miserable rank of 19, near the bottom, while countries like Denmark and New Zealand must be extremely corrupt as they score only one lousy rank point.

/irony

http://www.transpare...cpi2013/results

And in what proves does this index base its positions? cause if we re gonna talk of perceptions, I dont think its the best way to measure corruption...

 

[dennisr]

Don Alberto:
And the search for WMDs in Iraq at a cost of ~10k lives.....

Give me a break on pointing the finger about who has the moral high ground: Argentina vs USA. Our record is really nothing to brag about of late. Shameful for me personally.

 

[TWB103]

The Indec inflation rate is probably based on what the government thinks it should be if it werent for 'greedy big business' trying their luck by always pushing up prices on a public which almost genetically accepts very high inflation rates. Of course the big business is backed by anti government media saying that prices had to rise because of governments mismanagement of the economy.) Inflation is caused by a complex mix of contributing factors not just a dodgy government.

 

[TWB103]

@Don Alberto

 

[Don Alberto]

Sorry for posting a link, but the author describes -obviously- better the issue than I would (and he has more diplomas than I do too).
http://opiniojuris.o...interpretation/

Mainly a question of wording: "rank"/"ranking"

I did not ask for a general interpretation (I have read several) but for a specific explanation of the use of 'pari passu' in the two prospects.

 

[thorsten]

The dodgy factor comes into play, however, if a government ignores one of the most pressing issues for years, publishes obviously false figures and replaces people in the relevant positions who do not agree to lie about the real inflation...

 

[Don Alberto]

Don Alberto:
And the search for WMDs in Iraq at a cost of ~10k lives.....

Give me a break on pointing the finger about who has the moral high ground: Argentina vs USA. Our record is really nothing to brag about of late. Shameful for me personally.

Completely out of synch with what I wrote.

 

[French jurist]

Anyway, how will this end up?

The Vultures know Argentina won't pay or will pay little.

Argentina knows its position is strong: on one hand, Argentina won't pay because it can't pay. If payments to creditors of the restructured debt are seized, then Argentina has no other choice than defaulting partially (plus: the CDS might not even activate = Vultures would lose on both fronts since they bought CDS for hedging). On a diplomatic level, that would also be a victory for Argentina (both domestic/international). Argentina won a battle today (wasn't Griesa saying something like Argentina mocked court decisions more than once, etc.) since Griesa indeed became more flexible (he can go on vacations again in Montana, cool! Three times they were ruined because of Argentina). etc.


Within a month:
- Argentina makes offers the Vultures can't accept (like 2005/2010 = many bonds for a low value)
- Vultures makes offers Argentina can't accept (like a lot of cash + bonds for a big value)
- Griesa has to stop his vacations for a 4th time (no wonder he looks so tired)
- Then a few days remain before the default, Argentina has always paid the coupons for the renegotiated debt + declares a last time it still wants to honor its debt towards the creditors who negotiated.
- Griesa is trapped: something that was really too big for him from the start (because the worldwide refinancing of countries + millions of lives are at stake) becomes simply too much.

Heads I win, tail you lose.

Anyway, Uncle Vlad' is coming next month, and he has many proposals.

 

[French jurist]

I did not ask for a general interpretation (I have read several) but for a specific explanation of the use of 'pari passu' in the two prospects.

That's precisely why I wrote "rank"/"ranking" (ranking = payment?)