Quote:
Originally Posted by The Cobra
Borrowing is borrowing. If it doesn’t get paid back the assets will eventually get seized. Make no mistake the company is levered.
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That’s not what “leveraging assets” means at all. The discussion was “collateral”. Unsecured debt is debt with no collateral. It means the note holder is equal to the coffee supplier as far as repayment. Does CNRL have leveraged assets because has an account with Staples for paper and printer ink?
In fact, depending on the notes, those bond holders may rank below even normal creditors by virtue of equitable subordination or the provisions of the BIA and CCAA dealing with debt to shareholders.