PIK toggle
USA
A feature whereby the borrower under a note can choose to make interest payments either in cash or by payment-in-kind (PIK) and can alternate back and forth between the two forms of interest payments within certain parameters. This feature allows the borrower to reduce cash interest payments for a period if necessary and is more risky for the lender. The documentation often provides that if the PIK feature is activated, the interest rate is increased by 25 to 75 basis points. The PIK toggle feature is not generally available after the credit crisis of July 2007.
See also
+ PIK toggle
United Kingdom
See toggle

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Look at other dictionaries:

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