Thx. Love It! Especially this: “The cold hard reality is that from an economic position, the note-holders have just lost a tremendous amount of leverage and some of you CEO’s whose company stocks have been crippled by these transactions and those who have been tortured by message board posters would instinctively want to take revenge and put the screws to them. BUT WAIT! There is a solution that makes sense that is legal and puts both the issuer and the lender on better footing. The plan for a new class of convertible preferred equity designed solely to allow the convertible note holder to actually use the booked liability to really “invest”, short term, into the company. My group has been using this method of debt remediation rather successfully with no issues other than some lender pushback. Now with APLINE’s Friday the 13th massacre, I think that will change as well. The lender eventually gets what it wants out of the deal; the issuer gets the liabilities removed from its balance sheet allowing them to go out and raise more traditional capital; the pressure on the stock is alleviated, no more lawsuits, no more angst, its really a win-win for both sides. Less booked liabilities, more capital is available improving the company’s financial outlook, and in 6 or 12 months, the former lender, and now shareholder, can convert into common with no clearing issues.”
Any posts are just an opinion and should not be taken as investment advice. Always do your own DD
AI
