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I really do not think this ends well for retail but this latest agreement is far and away better than what I expected. Maybe the plan is to dilute the remaining shares until little is left or maybe tenor is actually taking a higher road than what I would expect from a hedge fund. the bond guys keeping their mouth shut for 20% interest is a huge win for CRY although once again it may make no difference. Management bought some time and remained in CCCA, thats as good as this situation could get while the arb process continues.
I think you may be putting the cart before the horse. Im not sure the company needs to state its intentions to disolve now for commons to recover value. As a practical matter that would be part of exiting CCCA which appears to be on extended stay. We are still miles away from any finish line and facing another dilution as soon as jan 14 from what I can tell so it may be a mute point. As far as the commons having value now, my thinking is if they did not have value this global settlement would have spelled it out. We will see
Much better results than I expected. I figured shareholders keeping 25% was a best case scenario. If it drags past 2014 or they need more money then another round of dilution will be at hand.
I have no horse in this race, just watching from the stands. Rumor is a deal has been reached with note guys. Its funny how that was only managed after shares were delisted/revoked. And i believe you are are mistaken about tenor not needing old shareholders to retain some value to have a valid claim. 1% should be sufficient for that purpose.
I think it all plays out the same regardless if shares were revoked or not. Old shares may be wiped out but I believe old shareholders will get a token of the new company/shares. Between 1-5% of new structure will be given to old bag holders me thinks. I believe new shares will be issued that are non dilutable to tenor, bond folks and management. The rest will be dilutable and given to old bagholders. It keeps them in the game and shuts down any attempt by VZ to say the arb case is void because the debt holders or DIP lenders cannot bring a case against VZ, only the shareholders. Just a hunch as to why old shareholders may keep something.
Those bending of rules may be nothing compared to a scenario where we leave CCCA after a possible deal with bond folks imo. Tenor possibly holding some cash to allow for a quick exit and get wheels greased for new round of dilution with rule bending imo. Is it starting to get clearer why the delisting was necessary and wasnt a SEC mistake? I dunno. Its may be nice for someone when this plan comes together with the possible added bonus of the SEC and CCCA being a distant memory.
The judge giving the company enough rope theory is likely to me. I was impressed the judge put the smackdown on bond folks out the gate. It was a tremendous victory. The company said all the right things but didnt follow up with the correct actions to make anyone really believe they were trying to save money for the benefit of retail. Im am so happy I walked from this train wreck long ago. Smelled especially bad the day I read about the consulting fee. What on earth is worth 30k a month to consult or a guy making huge bucks to answer a phone when an answering machine referring to CCCA case site would do just fine. And you are correct, Tenor holds all the cards at the moment.
The end game will be tenor and noteholders taking remaining 90-95% of the company me thinks. Retail gets diluted to the max but not totally wiped out as they need them to pursue the arb case. The extra salt in the wound will be the MiP and how it manages to avoid being diluted. Yes i think those share are the only ones important to those in charge.
I do not expect the judge to do more than he already has to save the commons which has been alot given the fact the bondholders are still locked up as of now. The CCCA does give him a lot of flexibility in the way of steering the boat regardless of what business decisions the management decides. The big red flag was the consulting fee for doing the obvious at 30k a month and it passed review with no issues from the judge. He could have made it an issue along with filing the financials directly or indirectly. So for those retail still thinking he is looking after retail should view things as more he is doing what he thinks is the best way to unwind this company.
You are correct no big players will be leaving much on the bone for the common, it just doesnt work that way.
It really is over for shareholders unless the judge actually helps their cause a bit more. He could have stepped in and forced the company to actually file their financials on time in exchange for maybe suggesting they terminate the 30k a month fee for consulting whiich of course is the joke of the century. The suggestion that this is strategic and temporary to benefit retail is silly as you put it.
It appears that the retail shareholders will be forced to accept another huge dilution in exchange for more cash. I doubt tenor will be cutting any breaks except possibly making management's MIP undilutable. In the end i see a $200-$250 million dollar settlement. Everyone is happy but retail. Yes i may be wrong but even in victory retail is in a poor position unless things drastically change soon.
Yeah no surprise. The only thing going on is the orderly transfer of wealth From shareholders to Tenor, bonds and management. I will be amazed if the shareholders keep more than 10-15 percent of company after tenor gets done with the next loan terms. I will not be surprised if management shares become undilutable as well. It will be ugly. As ownership transfers away from shareholders the amount required to settle will be reduced. $250-300 million will clean this mess up nicely for everyone but real shareholders.
A couple of things. Although the cases are similar, GRZ had a concession vs a contract for CRY. one could argue the merits of each, my view is GRZ is on much stronger ground but I believe both cases are winners. Worst case GRZ loses and many will view it as game over for CRY. Another bad out come is GRZ only recovers what they have spent on mine. That would be ok for GRZ shareholders but would leave CRY in a poor position as recovering $500 million in monies spent will not go far.
I think GRZ management thinks their case is so strong they will not settle unless the offer is very good and yes I think they are still talking to VZ about terms. I think VZ is talking to CRY as well.
a good GRZ win or settlement will boost CRY sp. A caprilles win is a longshot but sp would double. And maybe Maduro who does not have the charm of hugo will have to actually let CiTIC pay off both GRZ and CRY to get mines going.
Considering GRZ really didnt move much on the death its hard to see any lasting upside on the news. Now if bond guys came to a good deal for shareholders then that would be a reason to buy in my view. A settlement and soon is really the only way out of this mess for retail. If this plays out to an actual arb decision retail will be diluted to death imo. Management will hand them an empty victory bag.
Shocked face again that Hugo is dead. The only ones who didnt see this coming are the VZ people it seems. 75% believed he was cured of cancer, i guess they are now correct in a way.
Where does that leave CRY now that capriles gets another title match? My guess is another loss for capriles. The welfare wagon is a huge draw in VZ politics and hugo spent billions getting reelected. Free washing machines and free homes that never get built, the catch being you have to sign your name to a list. On election day the names on that list get driven to the election booth and watched. Democracy at its best.
Regardless, imo every day without hugo is a better day for everyone. Im not sure where the SP goes but there may be another bump up with hopes of change. I have no horse in the race anymore but imo the main threat to recovery remains with management, tenor and bond folks as CRY should win the arb case hands down.
Shocked face here. Im sure the company accidently forgot to deal with financials because they were busy trying to get Canadian shares trading again. I really feel bad for folks that keep wanting to believe. The only thing you can probably count on now is how much more Of any possible award is divided among key players. My guess is this new status will keep the details of the MIP buried. My guess continues to be more pie given to tenor, bondies and management,. Just my opiinion of course.
New filing from gw . Says they own 29 million shares again. We will see how long it lasts. Last year same thing happened and then gw all of sudden didnt own shares in later filings.
December 31, 2012
NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Greywolf Capital Partners II LP
(Date of Event which Requires Filing of this Statement)
** The reporting persons making this filing hold an aggregate of 29,705,005 Shares, which is 8.1% of the class of securities. The reporting person on this cover page, however, is a beneficial owner only of the securities reported by it on this cover page. [See Preliminary Note]
It is my understanding that cry pinky status is done on tuesday. To trade again on greys they would need to find a new broker/brokers for the wild wild west of trading. Am I missing something?
Jc not making the campers happy on acor forum. The no beers guy must be king bee in charge of feeding a false sense of security. nah no conspiracy. Cant knock managment for giving away whatever it takes to keep the lights and paychecks on. End of day tenor, bond folks and management MIP will all be protected from dilution. everyone else not so much.
Yes everyone thinks the judge is on retail side but he has a job to do and that is to get these cases settled and gone. This judge has been more than fair with management and yet management can not get out of its own way. Retail suffers as a result. Sad how a case is a huge winner for everyone but
Retail.
*So, appears management intentions are to stay alive through the arbitration by virtue of giving away arbitration proceeds. * YEP
The beauty is its all a win win for tenor and bond folks. At the end of the day whatever piece of pie given to them stays undiluted it appears. My guess is at some point the managment stake will gain that special undiluted status when the details are worked out. So actually CRY stays alive by issuing millions and possibly billions of new shares even if its at 5 cents a share or less and only retail gets diluted . Enough for bills and paychecks For staff and hope of a payday for new fish. Can you imagine this mess dragging out to 2016 or longer and what that would do to any share structure. Ugly.
I must say I am so glad I checked out of this train wreck awhile ago. Todays suspension is not good in any way shape or form. My guess is the filings are not accurate in SEC eyes. That can mean many things but it appears 5 cents is near if and when it trades again in the wild wild west sheets. Hoping For shareholders its an honest mistake and all is good in a day or so.
This has become a war of attrition. Note guys are like the honey badger and just dont care. Managment likes their salaries and everything else including saving cash for a rainy day is a non event. Hugo is sick and now everyone knows why the elections were moved up. Maduro will be the next president and nothing will change as the machine will throw enough money and welfare to get him elected as well. In the end i still see a crrstallex victory and shareholders that fell on the dilution sword to pay for it.
No surprise. Note guys seem to be on ice and would rather bleed the coffers dry than make a deal now. The strategy may be to gain 90% of the remaining shares in exchange for salary money when the well is dry. Managment will help their cause by continuing to spend 1.3 million a month at a minimum. I see victory for tenor, management , note guys and Crystallex corp. I see more pain for current shareholders. Managment must be hoping for a huge GRZ win and rise in SP so the next dilution will not be a death blow. You can do the math and at some point when management needs another 15 million the cost will be about 200 million shares at 8 cents. Ugly.
Market should be nervous. As time drags out dilution is the death star for this company even if managment can hold off the note guys. Its why cash burn is so important and its not a pretty picture. There is a slim possibility of a settlement soon but more likely a small pump and dump when chavez dies. End game is managment and CRY wins, shareholders not so much if dilution is used to keep the lights on for next 3 years.
New order seems to keep judge on side of crystallex for now anyway. I expect more of the same as the cash bleed continues. Im not sure how this helps note guys unless they expect managment to give up lots of shares for a small loan. Hugo health appears on the ropes again. This is key if a Citic Deal is really the solution . Until then his mafia will continue to work the pit because the split is currently better than a citic deal.
It will really only work out if management stops milking this cow for pay and benefits. Long term 12-36 months dilution will destroy and hope of a reasonable return for shareholders with current trends in play. My advice is bail on any decent rise in SP. A decent rise depends on your cost basis I suppose. I still do not expect much from mediation although note guys could have really made the situation work for them in more ways than one by rolling the debt for another 3-5 years.
Hard to say. Mms do what they want. I suspect if there is a material leak the volume will really spike. Bs stocks like this are the first ones people sell when margin calls and tax loss selling happens. It may be a simple washout for the next run to .14.
I think they wrote the value down on the remaining equipment to 1.6 million so they should at least hit that mark. Buying 70 million worth of equipment and paying 10% interest on it for 5 years gets expensive and turned into a 115 million net loss so far.
Regardless its good news and may give them a few more months of life.
Common ending up with a 30% stake would not surprise me. What would surprise me is if management rolls before a grz verdict. I do believe their strategy is to stall the stay until At least the hearing and I give them a 50% chance at success. I dont think tenor cares about the burn rate because they have dilution protection. Their 35% never gets cooked even if 2 billion more shares are issued.
Management will have no problem diluting until 2016 if their salaries are on the line. That would be a great plan for them imo. Bondies may get some preferred shares at some point as well that are dilution proof. Unless there is settlement soon shareholders will get cold left overs. Left in he hands of a salary loving management for too long is a one way ticket to a victory with no pay out.
I do think the issue is more about getting a piece of award than control of repayment for note guys. Priority of payments will go to debt holders first unless they exchange some debt for stock. i see them getting a stake but not in exchange for debt. They may get one seat on the board since they missed the DIP boat and had no intention of loaning 36 million on top of a bad bet.
I dont see any deals being made soon but who really knows. I do see this as a prime zone for a pump and main reason I am going to stick around more than a minute on this play. Rumors of a generous bond guy deal or VZ talks could be close.
The judge wants a deal. I agree. The unknown is the timeframe. I believe there will be another mediation after the grz decision if this one fails. Personally i am more concerned about the burn rate as any give away to note guys could have been offset to a point if a tight budget was followed. As it stands now i see another 15% stake gone just for some cash to last into 2014. Unfortunately i also think its wishful thinking the note guys wont pull at least a small stake of any award. Maybe they can cough up the next secondary 15 million money for that stake because its coming from someone if things continue.
Sounds like a great excuse. If the volume stays this strong since the appeal loss i will go on a limb here and predict a pump is on deck at a minimum followed by ? and you then can have this board again by yourself. No idea if it will be based on real news or nonsense like todays mm action. Ok see ya monday.
Thats my guess , folks getting in before disclosure. Retail has been beaten to a pulp and bid ask is so tight I doubt retail has 100k to throw at this today to scoop up a planned dump. But we will eventually see the big news disclosure. Have a good weekend.
Retail buying? Nope bid and ask too tight for that game. MM games as usual. Maybe note guys decided to cherry pick here while the monitor sits on plan for the next monh. I have no idea . Maybe MM just churning the shares for some business.
Why does it seem suspicious? You have one monitor handling many cases and CCCA rules seem meant to be broken anyway. We get more disclosure now I bet than CRystallex ever had in its passed. I have not even looked but this seems like a friday news after close type company. The volume is interesting this week as usual. All seems MM driven since the and is so tight.
Ok, the creditors may be decided by some unusual scenario but the lead class will be the unsecured class imo. The judge will not be forming a class representing 5% or less of non secured debt that will have any say imo and is as likely as him deciding a shareholder committee is a good idea. Now if someone had a lien on the actual asset then it would be a whole new ball game with a whole new class of debt but thats not the case from what I can tell. If so then adequate protection payments would have been required or the asset would have been taken long ago or most of the stock anyway.
I think GRZ had a concession or certain property rights that allowed the holder of the concession certain mineral rights. I dont think they actually owned the property. Both grz and cry want cost and lost profits and interest so to me the outcome of the GRZ case is huge.
I agree its not for the faint of heart. Imo the management team is the weak link and cant even be trusted to stop bleeding cash. My immediate worry is them selling another chunk of the pie so they can live another 8 months after they piss away the last 15 mil. Im not sure if noteholders crossed a line to such a point they have lost all their leverage. Part of this required mediation will be some tough love on both parties I suspect. It really is up to the judge regardless of the noise. I dont see the stay in immediate jeopardy but that makes the market I suppose.
I hear ya but the group you refer to is the unsecured creditors group. That is a class and as far as I can tell there is no other class that will matter. 95 % are the bond holders and the rest dont really matter. No one has super primed the estate except the DIP lender so the 2/3 vote that matters is already wrapped up by note holders unless they fell apart or are about to.
Im not sure how the Claims process is wrapping things up. Management says Some note holders screwed the pooch and they want it sorted out. I have no idea if management has a legitimate claim. But if they do the dynamic of negotiations may radically shift.
If I was the judge I would push for a settlement especially if he has leverage over both parties. His leverage over Management is stopping the stays and his leverage over note guys is continuing it and possibly more harsh sanctions. Really could go either way but my gut says stays continue at least until GRZ decision is read. Its the best barometer for this case.
There are better spec plays no doubt but i will roll the dice a bit longer.
<<Being so close, with all creditors except bondies agreeing, and a result of scuttling the company will say the system does not work. Not a good thing for the CCAA system. >>
Not sure what you meant by this statement since the note guys are 95% of unsecured debt.
Really it could break either way. In many ways the fact that there is only one real creditor that matters makes a debt roll much easier. They offered shareholders 14% at one time, maybe the fair thing to do is offer them 14% interest as a start. I do suspect if there was a big give away planned on the first management plan, that we may finally see next report, the stock would have really tanked. Thats not to say it wont eventually go that way but the holding pattern seems intact.
We will just have to see where the judge draws the line and the judge has been key. It may be 3 months or 3 years or somewhere in the middle. I do believe its a political issue and I believe he has no love for New York style tactics in his court. I do believe the judge is more inclined to let things ride for awhile and possibly put pressure on note holders at least until a GRZ decision is read. That in my view will be key as to the extent of further stays. Lets face it, if GRZ wins big it will be hard not to let Crystallex finish the game. My belief is management has alao pinned futher fundings based on a big GRZ win.
I will look around for some other examples at some point, but yes nortel and one of the airlines had a long haul in CCCA.
On most cases its a liquidity crises that brings about a CCCA and usually assets dont cover debt. Game over. The longer cases generally involve labor issues and smaller pieces of assets to be sold. Crystallex is much simpler case for the most part . Only one significant creditor and they have no way to be paid until a settlement is paid. They could of course allow Crystallex to emerge and allow liquidity back in their discounted bonds and still profit but thats another story. Another issue the judge may ponder is the political aspect of this case. Management is to blame for much but VZ should not get the pleasure of destroying companies for their benefit. It sends a bigger message if CRY can emerge intact and continue the fight.
CCCA in some ways is the perfect forum for a case like Crystallex. The prize is at the end of the rainbow with the goal of everyone getting a piece. The CCCA goal is a plan but as we know stays can last years and there are no rules as long as the judge likes the process. Before I see any end of Crystallex's stay i believe at a minimum the judge would actually hire consultants to value the claim as it stands and also estimate the likelihood of recovery. So far no attempt has even been made along that route and that would burn another year imo. Time is actually a friend if management can manage to not spend all the DIP money before Nov 13.
Can management show some control on spending? Well they will have burned through 21 million of the 36 million plus equipment money in 12 months. They continue to be the biggest threat to SP imo and dilution is 12 months away unless they get the burn rate in the 600k per month range. Maybe their plan is a big pop in sp to ease the pain of another 25 million share dilution. I just dont know but when I talked to HR all I got is there is plenty of money to last. Ya sure.
Disregard info about stelco. It was in CCCA for well over two years but shares were worthless at exit. This is a much different case in the asset is potentially worth billions and the process getting their is all the same. In the meantime MMs take us where they want.
I think the court is aware of their duties to facilitate a plan of compromise. I believe these 30-45 day extensions are prudent as it makes the parties talk. Does it mean the judge is getting tired of management? In my view no. Does it mean he is tired of Bond guys? Again in my view no. I think it means he wants them to negotiate in good faith per CCCA rules. I believe Stelco played this game over two years and shareholders remained whole.
When the judge says or implies the best solution is proceeding to arbitration then he may actually mean it. When judges says the note guys strategy failed, they probaly mean it. In my view his view is they should wait without being rewarded more than what is owed. He is well aware most of these guys are in at 40 cents on the dollar as it is so them waiting for a doulble plus interest is not unreasonable. Technically it should not matter what they paid for the notes but I believe it is a factor.
It really is a strange CCCA. One for the books really. The SC said dont waste our time with it so once again I assume the judge has complete control to extend stays at his discretion. He may feel now is the time to strike a deal since appeals are done so stays are short. Does that mean management will roll? They seem to be about the cash and the paychecks so I really dont know. But I dont see why they would have to roll at this point since their original argument was our position is to wait until arb decision. They since had to modify that stance since it spits in the eye of CCCA rules.
Dilution with our shares is a issue with me. I dont see tenor in any trouble as dilution would come out of management and shareholder stakes. So once again does management want to share? I doubt it as any dilution would be from a 65% remaining stake.
If cahoots was the plan Management should have rolled over long ago as they fulfilled their fiduciary responsibility to shareholders. At this point it becomes much harder for management to give away the goodies since they have the court firmly in their corner. The judge is no friend of bondies and they have solidified their position on ice. On top of that if they were all in on a share giveaway scheme management bringing up this latest charge seems over the top. Once again why bother.
Im thinking this may be a perjury or being less than honest situation note guys are now facing and not the workings of friendly or planned situations. The lead attorney hitting the highway is always a bad sign. That seldom happens as the cost is huge to get another lead up to speed. It could mean serious doo hitting the fan in bond land. Now we have court ordered mediations before the judge rules on the claim that the monitor appears to back.
As far as the financials I think mamagement stated their goal was by end of year. As far as a reorg plan, kicking the can down the road is well within he scope of CCCA as long as an effort is made that satifies the judge.