FormerXBC Inc XEBEQ

72. in Second Report to the Court submitted by Deloitte

[LyChauncey]

Not sure the motivation behind of the claim "all shareholders equity is gone". 

72. As described in this Second Report, the Cash Flow Statement indicates that the Petitioners should have sufficient liquidity to continue to meet its obligations in the ordinary course of business with access to its current liquidities and existing working capital.

Note in Appendix B the Net cash should be after deduction of current 25 million due. Liquidity is very tight in the near-term indeed. Q3 result may as well fix the covenant ratio. If creditors are happy and not-greedy af type (EDC, NBC and FSTQ are supposed not to be vulture funds), some 10~30 millions 2 years short term bridge financing seems more than enough for Xebec to execute its 3 year plan.

[AlwaysLong683]

If this was the case: 1) Why didn't XBC use the liquidity they apparently had to honour the terms of their debt obligations? When push comes to shove, honouring debt agreeements trump any other uses of your cash, for if you default on a payment, a secured creditor can seek to initate receivership to recover the amount owed to them. 2) Why did one or more creditors decide not to relax or

[LyChauncey]

1) As you can see in the Appendix B, liquidity will become very tight within a month if they decided to pay down the 25 millions. They choose to make sure contracts execution by paying suppliers and wages by delaying debt payment through CCAA.  2) Secured bank loans has coverage maintenance test. The companies' lastest earning reports are so bad which messed up with the coverage 

[Gann999]

Excellent analysis, well done.

[AlwaysLong683]

Ly, interesting points. So I assume you suspect existing XBC common shares will not be delisted and worthless if XBC avoids receivership / bankruptcy proceedings and comes out of CCAA a restructured going concern...?