A couple thoughts as it were to share with folks. First off thank you again to the big contributors on the board. ResidualRevenue, QTrader, S2Focus, and others have been a real help to us with PACER links, keeping a closer eye on the PWC page, and most importantly (to me) almost always providing links to back up claims with facts.
There were a lot of encouraging things in the court document yesterday that I wanted to highlight for those that maybe haven't had time to read it all.
First off, Comerica's first claim was for $14mm and it was reduced to $10mm after a $4mm parment by Mitsui & Co. Ok....so now Mitsui is really throwing their hat in the game on taking a special interest in BIOA's success. Everybody's been focused on the Oracle buyout....but Mitsui is really putting their money where their mouth is.
Secondly, Comerica was the only one grumbling about the petition for the $10mm DIP financing....even though the Ontario Government (owed $15mm), BDCC (owed $10mm) didn't. Comerica was more/less trying to aggressively protect their own interest yes, with a total lack for the others...but you have one of the largest banks in Canada, as well as the provincial government on the side of BIOA. This bodes well for our Chapter 15 proceedings.
The monitor testimony and cash flow analysis that was taken into account is showing that they believe the DIP financing gets them closer to an estimated marker value of $74mm compared to the $39mm that they would estimate should they be liquidated. The final tranche of the DIP is also dependent on a binding LOI (intent, not interest) by an interested buyer or investor OTHER than a liquidator or an auctioneer. That'll be the huge key to look for in July. If the final tranche is approved, we have a buyout.
The last part of this I want to bring up of course is the commons. At this point yes I believe it's still up in the air, and we won't know for sure what's "on lock" until the terms of the SISP and the binding LOI are. HOWEVER, this does not mean "all is lost" and "all is worthless." IMO Chapter 15s are more known for their maximization of value from all investors, so we have a better fighting chance, and there may be other avenues that are taken depending again on the terms in the LOI. Everyone has been using GM as a case study, so I too will use that. When GM filed in '09, their ticker changed to GMGMQ. In their case, the commons of GMGMQ were cancelled, however, unsecured creditors and shareholders were issued shares in Motors Liquidation Company, which was the shell financing vehicle for settling the rest of the bankruptcy, after the sales of all their intellectual property, assets, etc. Motors Liquidation STILL ran exponentially before settling down and becoming completely worthless, even though it was just a shell trust.
BIOAQ isn't fully insolvent, it isn't in half the trouble GM was in, we have a favorable court with government interest, and IMO from what it looks like just popped out behind the curtain with Comerica, they were likely the reason that BIOA filed their initial Chapter 11 anyways....to protect the assets of the company momentarily while they were finally turning enough $$$ to pay the bills while Comerica was the proverbial wolf growling at the door. Now we've learned that Mitsui has stepped in and paid some of BIOA's debt, and other high level secured creditors were "ok" with being pushed farther down the list should the higher level DIP financing be awarded. This speaks some pretty big volumes to me on where they think the future of BIOA is going. All in all, we good here.
