We are not against the C-Corp we are against they way it was handled. We waited all December to hear about our dividend. Then we got our Christmas present December 26th, the 8-K. Which basically gives away 38 percent of the company to the investors for nothing then. The actual merger of CCA and PZN was not too bad. It is the preferred stock and warrants to the investor group. IMHO, the cash infusion is not now needed. Especially since we pay no dividend. This company has low debt compared to equity, is very profitable, P/E ratio of 2, and earnings expections are rising. What is want is a C-Corp and a 10 percent dividend declaration and elimination of all debt (except to build a specific prison). This cash infusion is not needed according to the balance sheet.
With the stock so low now 4 3/8, the deal would actually not be to bad to new investors. The group must pay $6.50 per share. But for us old ones, we got our KY.
Yes, I'm lurking but still here, and still holding a position.
Re: C-corp, well I do know that whatever PZN is now, it's not a REIT, because it didn't qualify as one in 1999, regardless of management's "intention" to be one. What does that make it? I'd guess a C-corp. What else could it be at the moment?
Re: The Blackstone proposal, the whole notion of a strategic investor was made necessary by covenents on the loans, written by the banks, which insured that more funds flowed in before the special dividend was paid. Well now the 1999 special hasn't been paid, and can't be in the future. So the original purpose of an SI has gone out the window with REIT status and the special.
Now some have claimed that cash is so short that an infusion is absolutely necessary, but I don't see that Blackstone is the only group in the world with cash, and the options are myriad. Surely one with a fairer outcome for current shareholders can be constructed.
Voting on this deal is not about voting for C-corp status (or REIT status either, for that matter); it's not about voting for a cash infusion (as opposed to going it with cash on hand); it's not about saving PZN from bankruptcy.
What this deal is really about is smoothing the exit of some incompetent managers by feathering their beds and indemnifying them against the repercussions of the lousy decisions they've made in the past 24 months. And in return for doing so, Blackstone carves the heart out of PZN's profitability.
I'm inclined to vote no on the Blackstone proposal, and hope that some of the larger institutional holders will do the same, and moreover, package up some alternative financing that will put this moneymaking operation back onto the financial base where it can get on with making profits. Smaller common holders have to throw in with the larger ones and hope they will sponsor a proposal with much less larceny than the Blackstone proposal.
Bravo, your appraisal of the situation is succinct and right on target...distilled down to the essence.....and since lawuits have been filed against this larcenous group of turds the only thing remaining is a coalition of the aware common shareholders and a few instutions to get behind a third party who will pull this opposition together and kick ass. I still believe because of the overwhelming vig on this deal ,it will not go wanton for another suitor....who will perhaps be brought to the table by a large player stung by the deceit and arrogance of the Doc/Blackstone triad. DUMP THE DEAL and book a room for Doc at PZN.. (shame to give him such good accomodations)... I for one will send a can of Crisco to PZN to make Doc's stay as "smooth" as possible!