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Windstream Holdings, Inc. Message Board

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  • astral_tsar astral_tsar Mar 1, 2005 10:11 AM Flag

    win shares are dead its over

    Starting to think you're right. No bounce, just a slow downward slide.

    I'll hang onto my shares, but for sentimental reasons only.

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    • Deviations from the absolute priority rule may also be considered a nuisance payoff. The
      expense of litigating the value of the company was cited by many interviewees as a reason for allowing
      equity to share in the distribution."49 Creditors may allow equity to share in a slice of the estate pie by
      accepting the plan of reorganization offered to them, but if they reject the plan, the company continues
      operations in reorganization, most claims do not accrue interest interim, and a new modified plan may later
      emerge. For steadfast holdouts, a confirmation requirement is that they receive what they would under a
      hypothetical liquidation. Value is undefined in the Code. Since there is no true market sale, such is
      discovered by testimony. This may involve lengthy hearings. Parties may employ investment bankers and
      appraisers, etc., to strategically "value" the firm. Old equity may still be successful in participating in the
      distribution of new property rights over firm assets despite contesting creditors and court hearings. Even if
      the exclusivity period ends allowing creditors to propose competing plans of reorganization, 'cramdown'
      proceedings to freeze out old equity from the distribution, generally meaning enforcement of the absolute
      priority rule adherent to the `fair and equitable' doctrine whereas junior claimants receive nothing if any
      senior claim not accepting the plan is impaired, may also take time while lower tier claimants contest such.
      Boake Sells (1991), the CEO of Revco during bankruptcy proceedings remarked, "Shareholders and
      noteholders, some of whom would be entitled to little or nothing under strict or absolute priority, endeavor
      to improve their position by legal maneuvers that can, and do, delay cases for years." Besides delay, since
      the legal fees of litigation and court battles are paid from the estate as equity struggles to retain some of it,
      this also retracts from potential creditor recovery. These costs are avoided if equity is allowed to share and
      creditors voluntarily accept less than what they are legally entitled to according to their original debt
      contracts.


      KaptKos

 
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