RE: RE: Convertible debentures worth throwing a bu "are the debentures in a position to protect their position by voting against any proposed restructuring that is unfair to them?"
I have to make this point again just so people can keep this in perspective. Under CCAA all debt is paid in full before equity (Preferred face and divy) is given one red cent...It is the law. So it really does not matter what debt is subordinate to other debt when you are viewing it from an equity holders perspective. Now how can some here feel the debenture holders (and maybe others) might take a haircut but there will still be something for the shareholders? If you are going to entertain the notion that creditors will not be made whole, then you are by default conceding that there will be no money for the equity holders. If this goes CCAA, some of you guys had better dream up a model that has everyone being paid in full if you want to keep the shareholder payday dream alive. Again, this is not my opinion....It is legal fact...And it supersedes even the most fanciful model dreamed up on this board.
On a side note. Why are some of you using post LOC drawdown equity to pay pre LOC liabilities? That new $239M drawdown is not free money. It too has to be paid by Feb. 2013 over and above all that was outlined in the Q4 report. I am sure it was an honest mistake. Add a little equity here and subract a little liability there, keep the revenues and margins frozen and then...POOF...there are no problem paying this debt... and the market actually is retarded.
But don't take my word for it.....What does WB think about what I said?
Beware of geeks bearing formulas.
Warren Buffett