Thursday, September 08, 2016 11:32:15 AM
MSJ is a decent attempt - I don't think they prevail but I don't think that's the goal either ... moreso muck up the water, give the Court reason to cast doubt. Frankly I suspect it was drafted with a slight smirk given they did countless notes identical to the one at issue, could have avoided the situation if they were able to pay/remained current, and the scenario set forth as their rationale for the argument didn't happen. It comes down to the interpretation of what constitutes 'interest'.
HJOE seeks to highlight the hypothetical - what if everything had gone according to plan as detailed in the note - well KBM could have, thanks to a 45% discounted rate, converted all of the debt into stock, had HJOE honored their right to do so, and then potentially turned it around and sold for $78,182 - or ~$35k more than the note itself. There assertion is that those proceeds would have subjected the borrower to [or equated to] an 81% interest rate.
The note is clear - 8% interest rate, 22% default interest rate, below the 25% usurious threshold. I think counsel for Plaintiff hit the nail on the head...
HJOE seeks to highlight the hypothetical - what if everything had gone according to plan as detailed in the note - well KBM could have, thanks to a 45% discounted rate, converted all of the debt into stock, had HJOE honored their right to do so, and then potentially turned it around and sold for $78,182 - or ~$35k more than the note itself. There assertion is that those proceeds would have subjected the borrower to [or equated to] an 81% interest rate.
The note is clear - 8% interest rate, 22% default interest rate, below the 25% usurious threshold. I think counsel for Plaintiff hit the nail on the head...
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