Originally Posted by
Boomer
I'm no accountant, so let me see if I got this straight...
You're saying Mesa can create 900 million shares of stock out of thin air, it will not go down in value because Mesa says so, and then they are allowed to use it as money to pay off debt?
If it was that easy, why would any company in the history of Earth ever need to file bankruptcy?
While he's at it, why doesn't JO just issue 57 billion shares of Mesa stock and use it to buy Delta?
First, MESA's shareholders said MESA can create 900M shares, that's what the vote was about.
Where did I or anyone say it wouldn't go down? What are you reading? Short end of it, NO, you didn't get this straight. THE VALUE OF THE STOCK WILL BE DETERMINED BY A 5 DAY AVERAGE. Read the filing for yourself. It could go up, down or remain the same.
Here you go:
Originally Posted by "SEC filing, page 10
The “market price” of Common Stock means the average of the closing sale price of the Company’s Common Stock for the five trading day period ending on the third business day (if the third business day prior to January 31, 2009 and February 10, 2009, respectively, is a trading day or, if not, then on the last trading day) prior to January 31, 2009 with respect to the 2023 Notes, or February 10, 2009 with respect to the 2024 Notes, appropriately adjusted to take into account the occurrence, during the five trading day period, of certain events (i.e. stock splits, rights issuances and other distributions).
That's it in plain english. Page 10.
edit: MESA has been authorized (by the shareholders) to issue up to 900M shares. They don't have to issue all 900M. Depending on the stock price it can vary from between 350M up to 900M. The table on page 10 (SEC filing) shows a stock price down to $.10/share. If it were to go to $.05/share MESA would be unable to pay the debt. However, there are still other things JOe can do, like a reverse stock split e.g. ExpressJet. XJT did a 10:1 split. For every 10 stocks you held you now get one. That took the price from $.19/share to $1.90/share. But for now JOe has bought himself some time.
OO.