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ModusLink Global Solutions, Inc. Message Board

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  • belco_mc belco_mc Aug 21, 2012 7:21 PM Flag

    What does the MLNK SEC filing means?

    I didn't see that the filing specified where the violation occurred- only that there was a covenant violation.

    I'm sure a delayed 10Q filing would be a covenant violation so that's a good guess. I would also guess there is broad language covering the integrity and reliability of financial statements- which we now know doesn't exist due to the restatement. I would think a lender could accelerate a loan based upon that as well.

    I haven't checked in a while, but I don't think MLNK is carrying any debt- either long term or bank debt. If that's correct, all this does is increase their cost for their bank line of credit and reduces their limit. It isn't material since I doubt they planned on using it anyway.

    the lender is just protecting itself until the accounting problems are cleared up.

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