Indiana Code 27-13-12-5. Consideration of debts
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Sec. 5. (a) In determining net worth under this chapter, a debt may not be considered fully subordinated unless:
(2) any interest obligation relating to the repayment of the subordinated debt is subordinated under a clause that is in a form acceptable to the commissioner.
(1) the subordination clause is in a form acceptable to the commissioner; and
Terms Used In Indiana Code 27-13-12-5
- net worth: means the excess of total assets over total liabilities, excluding liabilities that have been subordinated in a manner acceptable to the commissioner. See Indiana Code 27-13-12-1
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
(b) The interest expense relating to the repayment of any fully subordinated debt is considered a covered expense.
(c) Any debt that:
(1) is incurred through a note that meets the requirements of this chapter; and
(2) is otherwise acceptable to the commissioner;
may not be considered liability and must be recorded as equity.
As added by P.L.26-1994, SEC.25.