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On November 17, 2016, the Third Circuit Court of Appeals (the “Court”) held that a refinancing during the pendency of the issuer’s bankruptcy proceeding of notes issued prior to the bankruptcy filing constituted an optional redemption that triggered an obligation to pay make-whole premiums under the relevant indentures. This holding reversed the decision of the District Court for the District of Delaware (the “District Court”), which had affirmed the decision of the Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Bankruptcy Court had held that (i) the issuer was not required to pay the make-whole premiums because the notes had been automatically accelerated upon the issuer’s bankruptcy filing (and hence, there was no optional redemption or prepayment) and (ii) the noteholders were prevented from rescinding such automatic acceleration due to the automatic stay. The Court’s decision not only overturned the decisions of the District Court and the Bankruptcy Court, but it also criticized the decision and reasoning of the Bankruptcy Court in the Southern District of New York in the Momentive case which is now pending appeal in the Second Circuit Court of Appeals.