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

To: Art Bechhoefer who wrote (20654)	12/29/2000 12:23:24 PM
From: pcstel	Read Replies (1) \| Respond to of 29987

Art: <"The Bondholders know there will be little cash left on March 31, 2000." How do you (or they) know that? G* has advised shareholders and the public that it will have enough cash on hand through June 15. Where do you get the March 31 figure (and I assume you meant 2001)?> Yes, I meant 2001.. Thanks for the correction.. The March 31, 2000 is the covenant date that Loral holds on the 500 million credit facility.. That is the first date that someone could force G* into Bankruptcy.. Unless G* fails to pay Loral the 13(approx.) million due on January 15, 2001.. The last figures that I have seen stated that G* would have around 150 million at the end of CY2000.. Figuring a 100 million a quarter cash burn rate, a 13 million dollar payment to Loral.. That would leave maybe 30 million in the bank at the end of March 31, 2001.. That's 40 days operational cash(with bond payments).. Which jives with all the statements from G* management that the current cash would run out in May. And that cash would probably be earmarked by the Bankruptcy judge to keep G* operating during the BK process.. So there would be no cash for the Bondholders!! No value in the space segment! No perceived value anywhere.. (But of course we know better).. So my point is that as the Bondholder would look at it.. Globalstar LP has ZERO VALUE in BK.. Their bonds would be worthless.. So maybe the bondholders would be interested in keeping the company going by exchanging bond cash interest payments for equity in the company..?? And then Loral would be willing not to call the credit facility on March 31, 2000.. So G* avoids BK. Operates 2 years or so without cash bond payments, The common becomes diluted, (but, no where near as much as a direct Debt for Equity Swap.. As GSTRF common rises passed 4 1/2.. Then the rest of the 60 million in tranches can be sold.. Which would give a cash bond payment free G* about 9 - 11 months of operational cash.. If in two years Globalstar can not generate enough revenue to continue the cash bond payments etc.. Then it will never be able to do so!! IMO <You also keep reminding us that the satellites are no good without the gateways. Isn't it also true that the gateways are no good without the satellites? I continue to believe the satellites have value, no matter who owns them.> I am talking about the perceived Value of the Space Segment in Bankruptcy.. We all understand that the Space Segment is worth a lot.. But, Globalstar is like a puzzle.. It has great value with all the interconnecting pieces combined.. But, when you break apart the pieces i.e. Space Segment, Gateways, etc.. The individual pieces have almost no value.. IMO.. It was designed to be that way.. As a poison pill, or a case such as this! IMO If you are a GSTRF Common.. Then you better pray that this is the outcome.. Because it is the Least Dilutive path in my opinion. JMHO PCSTEL