Hi Jared-
Regardless of the means of delivery(stock, cash, etc.) or timing (before or after wamu acquistion), each LTW should have a value = Adjusted Litigation Recovery/Outstanding warrants. The merger exchange ratio shouldnt come into the calculation at all. After all, this security is traded separately from DIMEQ and its value doesnt have anything to do with what DIMEQ shareholders received during the merger.
I think the lawyer that rewrote the amended agreement didnt understand that that since LTWs dont have a strike price there isnt any reason to adjust for the merger ratio.
I spent a considerable amount of time on the NAMCO valuation and strongly believe the 63 million award has no merit. However, the court used an approximation for retained earnings for the period between '95 - '97 since the actual numbers werent available. That is except for anyone who bothered to query edgar filings and get the figure which is available thru June '97. If we take the real numbers and then approximate the last three months (7/97-10/07) based on an interpolation over the previous two years it appears they are owed no more that $14,000,000.
1)Start with Purchase Price of NAMCO
$351,000,000
2)Subtract Retained Earnings June 30, 1997
-$144,064,000 (Filings NAMCO 10Q)
3)Subtract Interpolated Additional Earnings
-$7,025,833 Interpolated incremental qtrly retained earnings b/w 1st qtr '96 to 2nd qtr '97
New Mitigation Cost $199,910,167
Previous $185,900,000
Addditional Award $14,010,167
