The first secured high-yield bond to be sold under the new
German Bond Act has some innovative features, including the
first trustee-like service. But it still had to be structured
around gaps in the legislation.
Continentals 750 million senior secured notes
were the first to be sold since changes to German bond
legislation meant that it became possible to amend bond terms
Traditionally its been almost impossible to
issue high-yield under German law because the old law did not
provide sufficient flexibility for amending the covenants
post-closing with majority bondholder consent., said Marc
Plepelits, a partner at Shearman & Sterling who advised the
initial purchasers on the transaction. They were always
done under New York or UK law so the...