Phoenix Associates Land Syndicate (fka PBLSQ)

[anchorcheck]

Momentum, great post.

I can answer one Q for you. Preferred shares are NOT considered debt on the balance sheet. Preferred shares are EQUITY in the company. This, to me is the interesting part of how they structured the balance sheet. I had been assuming that they had been issuing preferred shares as part of the purchase price of the companies they have bought. They did, but, appaerntly not the series three.

Still, to the extent they issued preferred shares instead of debt, their balance sheet actually looks stronger, because preferred shares are equity, thus they give heft to the equity side of the balance sheet, while avoiding issuing debt. In all, this makes the balance sheet look very nice due to the reletive lack of debt. And to those that hold the preferred, it is similar to debt in that it carries a dividend, much like an interest payment, and you are ahead of the common stock holders.

Regards,

Anchor