How can JO win if the bond holders don't accept the shares?

 

If I was JO I'd say to the bondholders: "Here, you can take this old BigWheel as payment. It's worth 7 billion Mesa-dollars. Whether you take it or not, I'm calling us even."

That's how it works, right?

 

What is the meaning of the methane molecule avatar???

 

haha beats me... that's why I'm asking. Never seen anything like this before. 1100% new shares on a penny stock. Don't even know how the regulators are ok with this.

 

Why's that? Do you consider this good news?

 

Don't worry this might go strait to the bond holders however it's just one last push before they're delisted. Not good news for the company.

 

haha, no it doesn't have to do with flatulence, if that's what you're thinking.

To me it symbolizes our (humankind's) almost hopeless dependence on fossil fuels. I figured I'd just put up a methane molecule rather than one of the more complex hydrocarbon chains (which probably wouldn't fit, and nobody would recognize anyway).

And yes, I know methane can be derived from "renewable" sources. So maybe there's hope after all....

And now we return to our regularly scheduled Mesa bashing....

 

I'm not sure everyone fully understands...

IF the bondholders elect to exercise their repurchase rights, Mesa has the right to repay in stock. The amount of stock is calculated by using some 5 day average stock price. There is no choice for the bondholders as this was the terms of the early repurchase and since this move was approved by the shareholders, it is all kosher.

So, assuming all bondholders exercise their repuchase rights, at an average price of .28, it would take a little over 300 million shares to repay it.

 

For the bond holders to see that money they still have to dump those shares. One way or another they'll have to hit the street to be worth anything. Even if they are issued to the holders at an average of .28 they still will dilute the amount now available for trading meaning anyone holding onto their shares will see them drop since their market share is also diluted with it. If the stock was issued and the price didn't change accordingly it'd be no different than them printing their own money. One way or another, regardless of who gets the shares or how they get them, once those shares leave the companies hands the price/value of the ones currently out there will plummet.

Let me spell it out like this.

Bond Holders:"Hey guys we sure appreciate the money for the bonds that are coming due".

JO:"OH... yea... errr........... lets see I need to find a way to NOT pay you that money because... well... we don't have any. I know how about I avoid declaring BK right now by simply giving you a big bag of air and calling it stock repayment since it was agreed on in the past. That way my debts to you legally taken care of yet by the time you get to cash those shares out, if ever, they'll be worth nothing anyway! YAY I've avoided less people in line at the BK courts and can keep flying current contracts right now because if I had declared BK papa DAL would cut me off at the knees. Just a little more time to get golden parachute all lined up and papers burned so I don't go to prison!!" "Hey you there's porn on all the computers upstairs go start erasing everything!".

 

But there is no way it will retain $.28 cents. Like everyone said, that would be like printing your own money.