I havent been on this board for a while and I just caught up with this discussion and I think ALD gave a pretty clear indication of where this restructuring is going without giving the details.
On the conference call they said that the deal is agreed but not papered and they would announce when it is papered, which could take some time to get all the signatures of all the parties.
They also said it was going to be very expensive for ALD and that they would not be paying a common dividend for an "extended period of time".
Now putting one and one together, having followed ALD for some time, I conclude the following:
1. No BK. That doesnt make any sense to any party. By the way, restructuring is a generic term and doesnt equate to BK. It can be as simple as a change in covenants in exchange for a higher interest rate, which is where I think they are going.
2. Back in December they announced a restructuring agreement and then backed out in January. That agreement would have given the banks a security interest in the portfolio companies. If I were ALD I would try to avoid giving them that.
3. A higher interest rate on the loans would damage profitability and therefore they would not necessarily violate the BDC rules on dividend payout because there would be little or no taxable profit. I would not see a common dividend until 2011.
4. I believe, and I am not a lawyer either but I took a company through a chapter 11 a decade ago, that they can agree with the banks to modify their loan terms and not do anything to the public notes. They are curing an event of default with the private holders, and they are not IN an event of default with the public notes.
5. All of that works out fine for everyone except the common shareholders, who are in for a long slog.