RE: globalspeculation.com You have done some real work here Mr Bradford. Your article gets all thumbs up from me for the effort.
I will work through the cash flows tonight, although intuition already tells me there is a workout possible here. But the one part of your article I want you to elaborate is your assertion about conversion of the debentures to common shares.
As I read the debenture prospectus, the debenture is convertible *AT OPTION OF THE HOLDER* at a price of $8/share. Well, clearly, no one is going to exchange for $8, so that isn't going to happen. After 10/1/2013, Yellow can redeem the debentures, but only if the trading price of the common equity is 125% of the exchange price. Well, hello, that isn't going to happen right? After 2015 they can be redeemed in full, but who cares about 2015?
So do you see some conversion language for debentures that I don't see?
By the way, I do note someone at Scotia was buying a boatload of debentures. It's hard for me to justify that on fundamentals alone, even with the guaranteed interest payments, because debentures get 1% or 2% recovery in a CCAA.