University Of Pennsylvania Carey Law Faculty

In Murfin v Ford Campbell, an settlement had been entered into whereby firm shares were exchanged for mortgage notes, which could solely be redeemed if certain revenue thresholds had been achieved in the relevant accounting years. As the thresholds weren’t met, the loan notes were not redeemable, but at the date of the advisors’ breach of contract this could not be known, solely the mortgage notes’ face value could probably be recognized. The conclusion was that on this case valuation could not be done till after the profit efficiency grew to become recognized.

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