Below is the article related to the funding and construction of the SD Padres' ballpark in downtown San Diego. The article below relates to the Padres' decision to incur substantial payoff (make-whole) penalties to refinance the remaining principal due on its original construction bonds.(Note: The City has also refinanced its bonds related to the ballpark.)

In 3-5 brief paragraphs, discuss:

• How the bonds were originally priced and the Padres' portion of the original construction costs
• Were the bonds issued at a premium or discount and how can you tell?
• Why did the Padres' decide to incur the substantial penalties to rid themselves of the bonds?
• In general, what calculations were done to support the decision?
• What is a make-whole penalty and why would bonds have this provision

Article: click on this link: (Look at Padres' books shows debt reduction has team in position to spend - The San Diego Union-Tribune (sandiegouniontribune.com)

Subject: Financial Reporting & Accounting