DukeCrow

Not the best result coming out of the status conference. Judge didn't rule out the debtors sale of the company, Said specifically that debtors get a lot of leeway, and it is okay to sell the company before confirmation of a plan. No combination of all plans into a single one. Next hearing is August 30 to rule on the sale and the 2 competing plans.

Fellow sinking 'shareholder' here. I would note that the US Agency NOAA is likely the biggest issue here now. I believed that in the worst case they can sell the French part (which should on its own fetch a nice value because of the hot auction market). The NOAA apparently believes that the whole set should be kept as one and would contest the sale (as per both plans of unsecured and insiders). This certainly complicates things and the troubles with the auction become more understandable. I am not sure about the strength of NOAA's point of view, but if litigation was to really ensue, the buyer would have to be comfortable with it. We will see if a more rigorous bidding starts (and if the initial bids were just low-balling it), but I am not too sure about it. I see no appeal in taking the artifacts and setting up an exhibition out of them (apart from doing 'public good' which is why the unsecured are probably favourites here). The cash flow is unlikely to be attractive to command a high price (certainly nowhere near $200 million+). I thought that this would be offset by the French part which would put a sort of downside risk protection. Now that this is not the case, I believe zero should be regard as a clear possibility. My main learning point from PRXIQ is likely the following; When scrutinizing a legal play, map out all possible players and understand their incentive. I missed NOAA and did not pay too much attention to it because of the French rulings. Great points. The NOAA could tie things up in litigation, but I fail to see how they really have a LEGAL standing to their claims. The Federal court in VA has already stated that they don't have jurisdiction over the French artifacts. And there have been one off sales of Titanic artifacts here and there by individuals that no one tried to block. Also, Congress never passed any laws that would bind bankruptcy (or any) courts to enforce UNESCO. I guess potential buyers could be scared into staying away from bidding if they lived in Europe/UK, though. Biggest issues for me are whether the bankruptcy judge takes the NOAA's and NMM's objections (and UNESCO) into account in deciding what reorg plan to approve. He doesn't have to put those thoughts on the record. He could just state that he believes the Debtors or Unsecured Creditors Plans remove lengthy potential legal challenges and pay creditors the most quickly, while the Equity Committee's plan adds uncertainty which could damage recovery for creditors. In addition, the Federal VA court could frown upon the French artifacts sale and subsequently decide to strip the company of the American artifacts (which they have a right to do in bankruptcy) -- so shareholders would only recover as much as the auction of the French artifacts would allow. On the other hand, the bankruptcy judge approved the pending lawsuit the Equity Committee brought against PRXI insiders and has approved additional subpoenas surrounding the communication between NMM, Ad Hoc Equity Committee, the Debtors, etc. It's obvious to me that there is some collusion and insider dealing with the debtors plan (mostly between the Ad Hoc Equity Committee and the creditors that put forth the bid). As bskptkl previously wrote, the Ad Hoc Equity Committee was just looking for a way to get the artifacts in a lowball bid. They should have been competing with the stalking horse bid not establishing it, but they were smart enough to go in together so they weren't bidding against each other and driving up the price. No way they're all in it to keep the company going. If they buy the artifacts, they'll just turn around and do exactly what the Equity Committee is doing but only to their benefit instead of to the benefit of ALL shareholders. So they'll fiercely argue against the feasibility of the Equity Committee plan, but then just turn around and do it. I have no doubt about that. Really wish James Cameron and Robert Ballard would just swoop in and throw a $100M bid on the table and end this mess, lol. There were multiple articles a year or two ago about them doing it. I'm guessing they're standing behind the NMM bid ready to provide financing, but the NMM wants to keep the cost as low as possible (naturally). If the Ad Hoc Equity Committee group and the NMM had to bid head-to-head against each other, I wonder who would blink first. Pretty sure it'd be the Ad Hoc group, but I wonder what their limit is (probably a discount to what they think the NMM max bid is...but how much of a discount)? Sorry for the long post. Just thinking out loud.

Unsecured Creditor Committee also submitted a plan to sell to NMM for $19M. The court will hear motions for all the differing plans on July 25. Not sure what kind of a ruling will be made then or if a ruling will be pushed to get the parties to mediate further. This whole situation is ugly. Wish I never got involved. But since I am, does anyone have a read into what could/might happen? To throw another wrench into the situation, if the federal judge doesn't like what the plan is for the American artifacts, they can strip them from the company, since they are in bankruptcy. Only thing that is a positive is that the bankruptcy judge seems to be siding with the Equity Committee on most of its motions. Really hope that trend continues.

I'm not so sure the AdHoc group isn't trying to surpress an auction in order to win a low ball bid. They ain't the little guy in this drama. I think the formal EC is more in favor of an auction at Christie's or Sotheby's for example. You were 100% right on this. I should have listened to you.

I think they're just making the point that the op biz is currently running cash flow positive so there should be no rush in liquidating assets. The sale should be done in an orderly process without a rush to sell for the sake of ending Ch. 11 as quickly as possible. The company is blocking them from doing proper due diligence. They're just putting out hypotheticals to prove a point, IMO. The company had been profitable for quite a while until prior management made ill advised moves that put the financial health of the company at risk. The exhibition business had a positive NPV and appears to have one yet again. So the company is worth more as a going concern simply because the OP biz when run competently has a positive value. They can still monetize the Titanic assets without closing down the op biz. Personally, I don't care what happens to the op biz bc it's a small portion of the overall value of the company's assets. But I won't refuse any extra value that can be squeezed from the company. Don't trust management. There is so much self-dealing with current management. Their incentives aren't aligned with shareholders at all. They are basically trying to steal the assets from shareholders any way possible (look at the terms of the "Success Payments" in the "merger" with DinoKing). I think they are trying to make the point to the court that the Debtors only disclosed the unappraised value of the assets in their original Ch 11 filing and didn't disclose to the court the actual appraised value until later during the French Artifacts Sale Motion. Regardless, I certainly think that the Adhoc group and the Equity Committee are working in our best interests, while management almost certainly isn't. I'm very glad the Adhoc group came along to put some pressure on management to call off the rushed auction process while the Equity Committee's hands were tied (which was at least partially their own fault). I look forward to your ideas and opinions on this. Hopefully, we can all have a great final outcome :)

No offense, but if you trust management over the Adhoc Equity Group you are wildly misinformed as to the history of the company and insider motives. I'll try to comment on all your points later, but I'll quickly just say that the 2012 "auction process" was severely mishandled and poorly run. All it should be used as an example of is management incompetence.

I'm not so sure the AdHoc group isn't trying to surpress an auction in order to win a low ball bid. They ain't the little guy in this drama. I think the formal EC is more in favor of an auction at Christie's or Sotheby's for example. Curious why you say that. Everything I've read points to them wanting to have a properly marketed auction process taking place over 9+ months, while the Equity Committee committed themselves to the mercy of the Debtors rushed auction process with no ability to solicit alternative bids or plans. Don't get me wrong, I do trust the Equity Committee, but I'm also glad the Adhoc group is there as another group to challenge the Debtors. I don't trust the Dinoking insiders one bit. If anything, I would guess they would be the ones trying to win the Titanic assets in a low-ball bid. I'm very glad they have other groups keeping them in check.

Looks like mediation is still ongoing to resolve a few issues. The good thing is that the AdHoc Equity Group took part in the mediation, as well.

If you look at the acquisition by DinoKing (where Sellers literally gave half the company away for no reason), they included a contingent payout if the operating company hit certain targets (expansion into Macau, renewal of Cedar Fair contract, etc). The problem was that the company had no cash to make the payments, so DinoKing could force their hand to make the (fixed) payments in stock. So it was like a death spiral. The lower the stock went the more stock that would be issued to make those payments. It was an egregious term agreed to by Sellers (who should be sued for his negligence). With the stock below 20 cents, the dilution would have been so massive that shareholders would have been diluted into non-existence. I'm guessing the terms aren't valid in bankruptcy, but I'm not sure. Hopefully, if they are still valid, they're just another creditor that has to line up and can accept payment after the reorg plan is executed -- and they can't just dilute the hell out of current shareholders. Look at docket #8 filed 6/14/16 for a breakdown of equity outstanding. I believe the "exchangeco" shares are based on the contingent payout and there may be some grounds to claw them back. I know the equity committee has explored the issue. 37. As of June 9, 2016, the there were 65,000,000 shares of Company common stock, $.0001 par value authorized, of which 7,938,396 shares were issued and of which 7,938,195 are outstanding. In addition, the shareholders of 1032403 B.C. Ltd. (“Exchangeco”) have the right to exchange all of the 1,434,723 outstanding shares of Exchangeco for 1,434,723 shares of Premier common stock at any time and without payment of any further consideration. In addition, the holders of the Exchangeco shares own one share of Class 1 Special Voting Stock and one share of Class 2 Special Voting Stock which have no rights to dividends or payments upon liquidation but entitle the holder of the Class 1 or Class 2 Special Voting Stock to vote at any shareholder meeting, together with the holders of Company common stock, a number of votes equal to the number of Exchangeco shares held by such holder of Class 1 or Class 2 Special Voting Stock. B. Thanks for pointing me to that docket. That's interesting that the Equity Committee has explored a clawback of those shares. I'm sure that was brought up in the mediation. That's not, however, the contingent payouts (or "Success Payments" as they called it in the merger agreement) I was speaking of. Here's a link from the merger agreement spelling out the "Success Payments." A total of $8.6 million that can be paid out in cash or shares -- not at the discretion of the company but at the discretion of the DinoKing shareholders. Good thing is that it looks like Cedar Fair is moving on from their Dinosaur exhibits and that is half the value of the contingent payouts. https://www.sec.gov/Archives/edgar/data/796764/000117184315005188/gffdef14a_082815.htm#a_038 My understanding is that these payouts don't get extinguished in bankruptcy. They either survive or get renegotiated or exchanged. But achieving the targets seems to be getting less and less likely (the deadline for opening a Macau exhibit is June 30, 2018).

Great news for the contingent payouts, lol!

If you look at the acquisition by DinoKing (where Sellers literally gave half the company away for no reason), they included a contingent payout if the operating company hit certain targets (expansion into Macau, renewal of Cedar Fair contract, etc). The problem was that the company had no cash to make the payments, so DinoKing could force their hand to make the (fixed) payments in stock. So it was like a death spiral. The lower the stock went the more stock that would be issued to make those payments. It was an egregious term agreed to by Sellers (who should be sued for his negligence). With the stock below 20 cents, the dilution would have been so massive that shareholders would have been diluted into non-existence. I'm guessing the terms aren't valid in bankruptcy, but I'm not sure. Hopefully, if they are still valid, they're just another creditor that has to line up and can accept payment after the reorg plan is executed -- and they can't just dilute the hell out of current shareholders.

Mediation occurred earlier this week. The mediator's report should be out sometime next week. Hopefully, it provides good details on what took place. Debtors exclusivity has expired, so I'm looking forward to what comes out of the mediation and/or what plans are put forth by Alta/Apollo/etc.

As Picasso mentioned, Apple has been using Tomtom. But it's no secret that they also have vans driving around collecting data. They freely post the schedule for their mapping vehicles. http://maps.apple.com/vehicles/

Kevin Byun, Denali Investors

Is no one worried that even though these strategies may not violate the letter of the law they definitely violate the spirit (saving for college), which could raise problems with the IRS? http://www.lorman.com/newsletters/article.php?article_id=1073&newsletter_id=232&category_id=6 If the IRS thinks the plans are set up for the express purpose of avoiding estate or transfer taxes, they can invalidate your use of them, and then you've lost a lot of time and opportunity to setup your estate in a potentially more efficient way.