Keepwell agreement and Change of control


Keepwell agreement

Keepwell agreements is usually an agreement between the parent company and the subsidiary (which is the issuer), where the parent company agrees to keep the issuing subsidiary in good financial healthy, by maintaining certain financial ratios.

Change of control

A generic covenant stating that the bondholder has the right to “put” the bond back to the company if there is a “change of control” event. Investor should also find out the terms and conditions of the specific bond on what constitute a change in control.