Member Info for Hexam

“Banks do not mind if this goes bust.”

Now you’re just being silly. It may lower their tax bill but it’s still a loss and any company would still prefer higher profits and pay more tax than lower profits and pay less tax. Of course what they try to do is make as much profit whilst paying as little tax as possible - but that’s different.

Jeff, I don’t know what loans those companies have (I haven’t seen a list of lenders other than the top 30 unsecured creditors) - nor any shareholding they may have.

But the whole point of D4E for lenders is that they swap loans where they think they won’t get all their money back for a shareholding where their share of future profits is likely they think to be more.

Hopefully existing shareholders will be left with enough equity so that there is a decent increase from today’s sp - at least that’s what I’m banking on.

Wolf - the saddest thing about that post was that it got over 20 recommends from people who either believed the made up nonsense about you or that are equally confident that a company in Chapter 11 bankruptcy is such a surefire winner. Bizarre.

Jeff, I doubt if many of the lenders also hold shares - certainly not 200m as this would be disclosed.

Stnz - Agree, if you are looking at cash flow to keep the lights on but then you have to substitute any capex (paid for in cash not shares) for depreciation - and that appears to have been over $150m in the last quarter!

FP - I think from memory they were talking about $80-100m (?) but in terms of actual costs the accounts suggest (up to the end of June) around $85m - including the cost of the land but not of any rigs.

Depreciation is real money just spread over more years. The cost has got to be shown somewhere (machines don't come for free) and by spreading it over three or five years or whatever means the cost of machines better matches the income they generate so gives a fairer, and less volatile, view of profit or loss.

"So all current lenders (stakeholders)have shares."

Sorry Jeff - not the case - most have been strong stuff you were drinking :)

Lenders are stakeholders in the business but through loans they have made to the business not through shares they hold (though they may conceivably have these too).

Stakeholder is a general term for anybody that has an interest in the company and includes both shareholders like us and banks etc. who have leant them money. Also includes landlords etc.

"In a nutshell, CLSK are still profitable..."

I'm not too close to CLSK but they certainly aren't profitable at the moment - can't imagine any miner is.

In their last reported quarter they made a loss of $29m although it was only $16m from continued operations. On first glance though they do seem to be closer to breakeven than most as the loss was only around $6m if also excluding the losses from BTC both held and sold. So they are not far short of covering all overheads with their revenue (at least at the end of June).

On the contrary I think a D4E is in the 'best interests of lenders at present at present' as it represents their best chance of extracting as much value out of the business as possible for themselves and so recover as much of the money they are owed as possible.

Also, if I'm reading it correctly, Docket 221 suggests other lenders who are not already part of the DIP have been invited to join in?

"As a result of the Chapter 11 filing on September 7, 2022, a superpriority senior secured DIP term loan credit agreement in the amount of $1,935,000,000, dated as of September 9, 2022 (the “DIP Credit Agreement”), among Crown Finance US, Inc. as borrower, the several banks, other financial institutions and institutional investors from time to time party thereto and Barclays, as the Sole Bookrunner and Administrative Agent is being offered to all of the Lenders under the 2018 credit Agreement according to their pro rata share in outstanding Loans and Commitments (each as defined under the 2018 Credit Agreement).

Example: If I own $100 million of 2018 Loans, what am I entitled to?
- You will be entitled to elect to purchase $49,121,038.39 of the DIP Term Loan
- Your 2018 Loans / funded 2018 Loans ($3,939,248,972.18). The resulting percentage will be multiplied against the amount of the DIP Term Loan Commitment allocated to the participating Lenders under the 2018 Credit Agreement ($1,935,000,000 in aggregate for all Lenders)
- EUR to USD exchange rate of 0.9954x on the Euro Term Loan
- $100,000,000 / $3,939,248,972.18 = 2.539%; 2.539% x $1,935,000,000 = $49,121,038.39

Please indicate your interest in an allocation of the DIP Term Loan Commitment by making an election online via LendAmend or by checking off the appropriate boxes in the Election to Participate Annex...no later than 5:00 p.m. New York City time on September 15"

Pretty sure that saving is not per month. I think it is either $12m p.a. or $12m in total outstanding rent.

It's certainly an idea but may prove a bit of a stretch for existing holders who'd have to put in over 30x the value their current shareholding! Would have to rely more I think on new shareholders, particularly institutions, for take up?

A ramp of quite mind-boggling proportions - complete with obligatory capital letters.

That $785m liquidity is by CINE's own projections expected to be all used up.

I think there is a reasonable chance of upside from here but to unprecedented levels? Dreaming.

No problem Chae. CINE is a very intriguing but high-risk situation. It was when I bought in ages ago and even more so now under Chapter 11. Could still go either way but there is an awful lot of misinformation being spread on that board in both directions - either deliberately or through ignorance - by the moon and doom merchants. It's a bit like what the ARB board used to be like :)

From THG RNS:

"Dean is a chartered accountant with over 35 years of public company experience... He was previously Chief Financial Officer at Cineworld Group plc...He is currently the interim Chief Financial Officer of Dignity plc (having been an independent non-executive director upon appointment), a non-executive director of Griffin Mining Limited, and Senior Independent Director at both Cineworld Group plc and Volex PLC."

Why are you banging on about Chaebol and FP being day traders? They are not from what I can see but I'm sure they'll correct me if I'm wrong.

It’s just a CINE NED taking up an additional, similar role in another company.

NEDs often work with several companies at the same time.

Can’t see any particular good or bad news in this just amazed that some have misread it so completely.

Poor - Enjoy your evening!

...and I think you meant creditors

"I agree with a lot that you say, however my main contention with you is the valuation of the company and how the debtors will move forward with it."

But these are bits I agree completely with Wellington on - so genuinely puzzled if you agree with Wellington on these things but not with me.