I stated in my post on FO that if I HAD to own the name, I would swap from 14s to 16s and take out $5. Seemed reasonable at the time and for the levels being talked about. One problem:
Interest rate adjustment: The interest rate payable on the notes will be subject to adjustment from time to time if our debt rating is downgraded (or downgraded and subsequently upgraded), as set forth in “Description of the Notes — Interest Rate Adjustment."
Change of control offer: If a change of control triggering event occurs with respect to the notes, each holder of the notes may require us to purchase all or a portion of such holder’s notes at a price equal to 101% of the principal amount, plus accrued interest, if any, to the date of purchase. See “Description of the Notes — Change of Control Offer.”
The 16s do not include the steps or the COC. Since I do not believe the COC would be triggered by a spin of a business line. I will ignore this and focus on the steps. These will help support the bonds should FO spin a large business line and retain the debt.
Bad Michael, Bad! Inexcusable error.
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