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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: Jeffry K. Smith who wrote (11895)	4/24/2000 10:00:00 AM
From: Jon Koplik	Read Replies (1) \| Respond to of 29986

If a company is late on even a single coupon payment on one or more of its bond issues outstanding, it is in default, and can be pushed into bankruptcy by the bondholders. (Nowadays, people usually try to work out a deal, at least for a while). GSTRF would not attempt to delay any payments (interest or principal) unless it had no way at all to come up with the money. (A reminder -- GSTRF management has recently stated that if the company had ZERO revenues for the next year, it can still service all of its debt obligations). If a company defaults on its debt, a messy (and time consuming) (and bankruptcy law firm enriching) bankruptcy proceeding will take place, culminating in a reorganization of the company's debt and equity structure, with the previous bondholders (usually) becoming stockholders. Jon.