In reading through the FAQ again very literally, it's clear that the Company owns 3% of the Equity in the 106 hotels and 100% of the Equity in 20 hotels. There are three critical points here that will determine implied pref value:
1) In order for WNT to receive any common equity distributions (it owns 97% of senior mezz llc), the prefs have to be brought current. Which set of sources do those economics come from - proceeds on the 106 hotels or proceeds on the 20 hotels?
2) What is the collateral package for the $50 million Junior Subordinated Debt (which is a Trust Preferred security)?
3) Overarching all of this, how does Goldman allocate value to each individual hotel?
In any event, my rough math suggests that there is absolutely value beyond the liquidation preference ($25/share),and with a literal read of the charter, I still believe the prefs will be brought current with the pro rata portion of equity from the 106 hotels and 20 hotels, which would leave enough proceeds to redeem the prefs at $25/share. So I think fair value is par plus accrued.
