[From Groklaw:]
Debt in Disguise
,----[ Quote ]
| The purpose of securitization is to make the credit rating of the company
| practically irrelevant in a financing, so that even in a bankruptcy the
| receivables cash flow will be protected....
|
| The rating agencies also rely greatly on legal constructs that say the
| payment stream to investors will not be hindered. For instance, the transfer
| of receivables to the SPE must be a "true sale." That is, the seller must not
| retain too much of the reward or the risk coming from the asset, says Robert
| Hahn, a partner with Hunton & Williams LLP. In addition, the SPE has to
| be "nonrecourse" — in other words, the company's creditors must not have
| claim to the assets of the SPE if the originating company goes bankrupt.
|
| "Securitization divorces the creditworthiness of the [company] from the
| credit of the pool," says Mark Spradling, a partner with Vinson & Elkings
| LLP. "True sale and nonconsolidation are part of that separation."
|
| But the opinion that legal control of receivables has passed to a third party
| has not been litigated in the bankruptcy courts....
|
| Tapping the capital markets without a lending bank in between means that even
| non-investment-grade companies can finance at near what triple-A companies
| pay.
`----
http://www.cfo.com/article.cfm/10013957/c_10203909?f=home_todayinfinance&x=1
Microsoft's 10-Q on the impact of litigation
,----[ Quote ]
| Antitrust, unfair competition, and overcharge class actions. A large number
| of antitrust and unfair competition class action lawsuits have been filed
| against us in various state, federal, and Canadian courts on behalf of
| various classes of direct and indirect purchasers of our PC operating system
| and certain other software products. We obtained dismissals of damages claims
| of indirect purchasers under federal law and in 15 states. Courts refused to
| certify classes in two additional states. We have reached agreements to
| settle all claims that have been made to date in 19 states....
|
| Other antitrust litigation and claims. In November 2004, Novell, Inc. filed a
| complaint in U.S. District Court in Utah, now consolidated with other cases
| in Maryland, asserting antitrust and unfair competition claims against us
| related to Novell’s ownership of WordPerfect and other productivity
| applications during the period between June 1994 and March 1996. ...
|
| Patent and intellectual property claims. We are vigorously defending more
| than 45 patent infringement cases. ...
|
| Adverse outcomes in some or all of the matters described in this section may
| result in significant monetary damages or injunctive relief against us that
| would adversely affect distribution of our operating system or application
| products. We may enter into material settlements because of these risks. ...
|
| As of December 31, 2007, we had accrued aggregate liabilities of
| approximately $840 million in other current liabilities and approximately
| $660 million in other long-term liabilities for all of the contingent matters
| described in this note. While we intend to vigorously defend these matters,
| there exists the possibility of adverse outcomes that we estimate could be up
| to $4.1 billion in aggregate beyond recorded amounts. Were unfavorable final
| outcomes to occur, there exists the possibility of a material adverse impact
| on our financial position and on the results of operations for the period in
| which the effects become reasonably estimable.
`----
http://www.sec.gov/Archives/edgar/data/789019/000119312508011476/d10q.htm
By the way, the trolls may be attacking so vehemently because people are
getting closer to finding out the truth. Microsoft, with or without debt, is
clearly in trouble. The same goes for some other companies, but Microsoft is
no exception.
Yesterday:
EU May Fine Microsoft Over Antitrust Case, People Say
,----[ Quote ]
| The fine may be announced as soon as Feb. 27, said the people, who declined
| to be identified because the decision isn't public. Microsoft said in a Jan.
| 24 U.S. regulatory filing that the penalty may be as much as 1.5 billion
| euros ($2.2 billion).
`----
http://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=MSFT:US&sid=aG8SwG8llTmM
Related:
Microsoft's Last Big Beat: Internet Domination or Death
,----[ Quote ]
| What can $44.6B USD mean? Well, for Microsoft (MSFT) it may mean the cost of
| survival.
`----
http://seekingalpha.com/article/63876-microsoft-s-last-big-beat-internet-domination-or-death?source=yahoo
Microsoft says to borrow money for Yahoo deal
,----[ Quote ]
| Microsoft Corp said on Monday it may borrow money for the first time in its
| history to fund a portion of its $44.6 billion unsolicited offer for Yahoo
| Inc.
`----
http://www.reuters.com/article/companyNews/idUSN0455692920080205
Will Microsoft Survive the Next 10 Years?
,----[ Quote ]
| I am not really an expert in this but when I read all the negative
| headlines and articles I ask myself if Microsoft really will survive
| the next 10 years.
|
| [...]
|
| I am pretty sure that the Open Source Community, the new Ubuntu,
| Google and of course Apple are those companies that are ready for
| our century and they will get more and more people that know what
| they really want.
`----
http://websquirrel.blogspot.com/2007/03/will-microsoft-survive-next-10-years.html
P. Graham: Microsoft is Dead
,----[ Quote ]
| A few days ago I suddenly realized Microsoft was dead. I was talking
| to a young startup founder about how Google was different from Yahoo.
| I said that Yahoo had been warped from the start by their fear of
| Microsoft. That was why they'd positioned themselves as a "media
| company" instead of a technology company. Then I looked at his face
| and realized he didn't understand. It was as if I'd told him how much
| girls liked Barry Manilow in the mid 80s. Barry who?
|
| Microsoft? He didn't say anything, but I could tell he didn't quite
| believe anyone would be frightened of them.
`----
http://www.paulgraham.com/microsoft.html
Microsoft's DreamSpark – What a Giveaway
,----[ Quote ]
| The rest of the $44.6bn (£22.3bn) deal would be financed with an undisclosed
| amount of credit.
|
| What that means is that it must squeeze as much money as it can from its
| operations to fund that debt and still pay dividends to shareholders, who
| will be looking for some payback from the Yahoo takeover. Giving away
| software is the last thing it would want to do in these circumstances, and
| the DreamSpark announcement shows just how worried it is about the future.
`----
http://www.linuxjournal.com/content/microsofts-dreamspark-%E2%80%93-what-giveaway
|
|
