When Rotech announced BK, it was the company that stated the shareholders would receive 10 cents per common share. Millions and millions of shares subsequently traded after this statement was made, based on this share value. The company now claims that the Equity Committe's costs consumed that amount. But it was The Court that determined an equity committee should be appointed and the court approved their actions. It would be my opinion that the court will not allow Rotech to disavow the 10 cents since equity committees are a frequent event in BK's that involve debt for equity swaps that leave common shareholders with little or nothing. As such, the equity committee and its costs would be considered a necessary and normal cost that could and should have been expected to be borne by the filer.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.