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CDC LOSES BOND SUIT

 

CDC Software logoCDC Software has lost a court action in which bondholders claimed about $68 million in damages. Evolution, the bondholder, was granted a motion for summary judgment in the motion against the software company. Meanwhile, CDC is seeking injunctive relief and monetary damages of $295 million and punitive damages of more than $500 million it claimed CDC gave confidential information about CDC’s plans for an IPO to third parties, including hedge funds that trade CDC stock

. CDC also alleges Evolution sought to interfere with the offering to tortuously interfere with operations and control of CDC Software. Once the judge enters the final order in favor of Evolution, CDC said it may appeal the ruling. The Evolution victory surrounded 3.75 percent senior convertible notes that the company held and which CDC said were invalid. This stems from last fall’s notice that bondholdershad elected to redeem $42.225 million in notes. However, on November 11, CDC informed the holders that they couldn’t perform the transaction because the company had adopted amendments in November that meant that the redemption provision was no longer in force. I always thought that the company’s action looked a little last-minute in regards to being forced to ante up and winning a motion for summary judgment suggests that was the case. In a summary judgment, the facts aren’t in dispute and the judge rules on the applicable law.

 

 

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