BioAmber Inc fka BIOAQ

[Koan]

HYPOTHETICAL VS REALITY

An initial statement was made that the equity in Bioamber Inc. is impaired, (post# 81948), then again restated in post #'s (81967) and (81970), along with doubling down and stating the equity is "legally impaired", whatever that means, post# (81975), and then tripling down in post# (81988) with the additional statement BioAmber is "intrinsically worthless". Sounds like a lot of doom and gloom.

So, the question was simply asked, "By how much is the equity in BioAmber Inc. impaired?" post# (81969).

Take note that no dollar amounts or legal definitions or laws have been cited, no supporting documents or links provided, and in their place comes the following answer, in hypothetical form:

For example, say there is exactly $100 million in unsecured claims. Under the bankruptcy, there is $30 million to pay the unsecured claims. That would mean unsecured creditors are 70% impaired (or, they will receive 30% of their claim, or 30 cents on the dollar) as each claim receives a pro rata amount of the pool.

The same is true of the common shares.

And in the case of BioAmber, common shareholders are 100% impaired.

Several things to immediately notice:

1. The answer is hypothetical.
2. The answer switches "equity" with "unsecured creditors"
3. There are dollar amounts in the example!

Percentages are a result of and factor of dollar amounts. Percentages do not exist in a vaccuum.

Given that, the question can be asked a different way:

Even if there is such a thing in this case as BioAmber equity being impaired (more on that in a second), let us assume a situation where the equity in BioAmber Inc. is only 99% impaired. How much equity would be remaining in the 1%? This should be expressed in dollars, just as in the above hypothetical example.

Now, there are several reasons why this cannot (and no doubt will not), be answered, but chief of them all and fundamental reason is that the initial statement that BioAmber Inc. equity is impaired is a completely fabricated concept that currently exists nowhere in reality. So...

BACK TO REALITY

In May of 2018 BioAmber Inc. filed Chapter 11 court documents in tandem with its two Canadian subsidiaries, BioAmber Sarnia Inc. and BioAmber Canada Inc., who each filed under BIA in Canada. These filings were all independent and non-consolidated in their respective countries.

BioAmber Inc.'s filings (BioAmber Inc. is the US parent company where shareholder's shares are) checked the box that there will be funds available for distribution to unsecured creditors. See below:





Within weeks the Chapter 11 was discharged upon recognition of Chapter 15, when all three non-consolidated filings (Chapter 11 and two BIA filings) were combined under the CCAA for administrative efficiency. The following court document for BioAmber Inc. cites one of the reasons:





In October the Visolis Transaction closed (the asset transaction) for a total upfront purchase consideration of 4.3 million. The 4.3 million was ordered via Canadian Superior court to be distributed to the three separate companies as follows:

BioAmber Sarnia Inc. - $4,112,700
BioAmber Inc. - $222,300
BioAmber Canada Inc. - $5,000

Additionally, as per BioAmber Sarnia Inc.'s NOI Notice To Creditors filing, BioAmber Sarnia Inc. owes BioAmber Inc. USD $1,104,962.42, leaving a balance owed of USD $882,662.42.

This makes BioAmber Inc. both a creditor and shareholder of BioAmber Sarnia Inc.

Now, under CCAA Classes Of Creditors, related creditors, and in regards to any Plan Of Arrangement for the wholly owned foreign subsidiary BioAmber Sarnia Inc., note well the following:





Moreover, apart from the general distribution protocol from the asset transaction and check written to BioAmber Inc. for USD $222,300 (side note: checks are written in dollar amounts), this still does not factor the accounts receivable and remaining sale of inventory, both of which were not part of the asset transaction. There are estimates of AR pre-filing in the range of 14 million. This also does not factor in any HST refunds as noted in the most recent Canadian judgement.

So, given that BioAmber Inc. had funds available for unsecured creditors (as per the legal documents) before both collection of AR and distribution of proceeds from the asset transaction, the US courts have no debt of BioAmber Inc. to discharge and therefore equity interest must necessarily remain intact and bear whatever intrinsic or extrinsic value it holds.

MORE NOTEWORTHY ITEMS THAT EXIST IN REALITY:

1. PwC as court appointed Monitor has released thirteen monitor's reports and three additional supplementary reports. Nowhere in any of these documents contain the phrase or statement, "BioAmber Inc. equity is impaired".

2. There has been over 30 published court motions, orders, and judgements. Nowhere in any of these documents contain the phrase or statement, "BioAmber Inc. equity is impaired"

3. There has been countless email correspondence between lawyers from shareholders, PwC, and others. Nowhere has any lawyer made the statement, "BioAmber Inc. equity is impaired".

4. A statement was made in person, in court, that this is a "complex restructuring".

5. Marc Duchesne, the lawyer for the monitor, cites his role in this restructuring on his own Chambers resume:





6. Richard Eno and outgoing CEO currently has written on his own resume, "ultimate sale of the company" and, as noted in the most recent judgement, the entire BioAmber Board Of Directors fully knew about and agreed to the Visolis/LCY Chemical Corp joint venture and investment in BioAmber Inc. and Visolis Transaction:





THE VINMAR CONTRACT

Vinmar International Ltd. has agreed to postpone to December 31, 2019 any right it may have to terminate the offtake agreement for 1,4 BDO with BioAmber Inc.

This is a 15 year offtake agreement in which Vinmar would take an equity stake in a second plant and an obligation to purchase 100% BDO and THF produced there for 15 years. It is this agreement that upon execution has a value in the billions. To this end, BioAmber Inc. had already completed two of four phases and has been selected for a third phase with the US Department Of Energy to secure a 360 million loan guarantee under the Title XVII Innovative Clean Energy Project in order to build this second plant in the US. Simply completing the first two phases costs a company hundreds of thousands of dollars.

Notwithstanding Crane LLP's efforts under the CCAA in the Canadian courts to execute on the Vinmar contract, this agreement remains an extremely valuable prospect that is at once favorable as written and, if it is allowed to lapse or to be renegotiated by any acquiring company it is not at all clear Vinmar would negotiate the same or similar terms.

So, it behooves almost everyone involved, i.e. Visolis, LCY Chemical Corp., LCY Biosciences, BioAmber Inc., Vinmar International LTD, creditors, and lawyers both Canadian and US to facilitate any restructuring, plan, or arrangement of BioAmber Sarnia Inc. in as expedited a fashion as possible and forthwith complete the CCAA proceedings and move to execute on next steps which must occur outside of both the monitor's purview and the CCAA.

As per the most recent Canadian judgement, the CCAA will be terminated upon receipt of any HST refunds (line item [118]) and subsequent Discharge Certificate (line item [120]), which is what BioAmber Inc., shareholders at large, and the US Counsel are waiting on. See below:







GOVERN YOURSELVES ACCORDINGLY