Arcan Resources Ltd ARNBF

teevee, debenture redemption

[jd43xl]

You left out a very important paragraph, which says that ARN cannot redeem the debs early unless the share price is above the conversion price;
"The Debentures shall not be redeemed by the Corporation prior to February 28, 2014. On and after February 28, 2014 and prior to February 28, 2016, the Debentures may be redeemed by the Corporation, in whole or in part from time to time, on not more than 60 days and not less than 40 days prior notice at a redemption price equal to their principal amount plus accrued and unpaid interest, if any, up to but excluding the date set for redemption, provided that the Current Market Price on the date on which notice of redemption is provided is at least 125% of the Conversion Price"

[teevee]

jd, I am not here to argue. I stand by my reading of the prospectus so I guess we will have to differ on our reading and understanding. Good luck to you.

[jd43xl]

But why did you leave out the most important paragraph in the prospectus? That is no different than lying.

[teevee]

 You apparently dont get it that the paragraph you quote doesn't govern the paragraph I posted. The company may pay with stock, and do so at 95% of market price. Needless to say, if the deal is voted down,  the company doesn't have the ability to redeem with cash now, nor will it have the ability to redeem with cash at expiry, so paying with stock is the only alternative before

[jd43xl]

teevee, why do you continue to post lies. You have it backwards. The paragraph I quoted from the prospectus has to be satisfied first. Who exactly are you working for?

[teevee]

jd, Given how close the market for debs is to offer, I can only conclude you are shorting the debentures, intending to cover if the deal is voted down. 

[jd43xl]

Yup, when confronted with facts, lying scumbags always resort to some sort of accusation. But no, I am not shorting anything. As for you, how about acknowledging that you were wrong, and I was right about what the debenture prospectus says? That would be a good start toward repairing your reputation.

[seriousinvest]

TV I find your interpretation to be nothing short of bizarre.  That provision is a very standard one that is contained in every convertible debenture I have ever read (the percentages and dates of course vary).  While I was not involved in the Arcan Debentures, I have been professional involved in the issuance of many other convertible securities and I can assure that your reading is

[teevee]

The facts remain that if this deal is voted down, the debentures will go back to 50 cents on the dollar,  ARN will continue to deteriorate, and when the debentures come due, debenture holders will be faced with the prospect of being paid with shares instead of cash. I can only imagine what the liquidity and price for those shares would be, but I do know that debentures holders  wouldn

[rad10]

guys - there are other options at maturity.  With a 2/3 majority vote the debenture terms can be amended. Typically an increase in the interest rate, a consent fee, and / or a reduction in the conversion price are offered in exchange for lengthening the term of the loan. Bondholders will often accept a combination of the above - because the alternative is worthless diluted penny stock

[teevee]

I believe the reason why the debentures traded at 50-60 cents on the dollar before the offer on the table, is because the market believes that is all they are worth after satisfying the secured lenders/banks. If so, there is nothing to renegotiate as the offer on the table for the debentures a significant premium to market. I agree the unsecured debentures rank ahead of shareholders, however, in

[jd43xl]

Well, I believe you are talking out of your butt. The Aspenleaf offer proves that the market is wrong. They are offering enough to pay off the secured lenders and the debenture holders at face value. The bottom line remains that the debenture holders are being asked to give money to the common shareholders, who rank at the very bottom of the pecking order. It is simply unacceptable.

[teevee]

Not so. Aspensleaf is simply paying a premium to market to the debenture holders and throwing a bone to shareholders. What ever you think or believe and insist is fair or what ever, if voted down, your debentures are likely to return to 50-60 cents on the dollar, may end up being worth less if ARN continues to deteriorate, either resulting in the banks reducing or calling the line of credit, or