Comment by bluGill
3 months ago
If the llc declares bankruptcy does meta have to pay the bank for it - or can they buy the assets at fire sale prices?
3 months ago
If the llc declares bankruptcy does meta have to pay the bank for it - or can they buy the assets at fire sale prices?
I have skimmed through the article and if I get the details through all the humor, satire and sarcasm even remotely correct, the major assets are actually the duality of payment obligations and residual value guarantees, both from meta. One could include cost overrun protection at the construction time too.
The "fire sale prices" would be so delicious as to guarantee that the entity(-ies) involved stay solvent as long as meta stays solvent.
My personal experience with LLC loans and banks is that the bank is using the assets as collateral and me as a backstop.
I thought the whole point of LLC was to limit liability so you wouldn't be liable for debt beyond your paid up capital? Why would you ever sign a personal guarantee?
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"Me" in this case being a stand-in for the principal owner, which could be a corporation, individual, or group of individuals
Meta doesn't actually owe the bank anything in this setup. That would be Blackrock and the other private creditors.
Mechanistically, how would the LLC achieve bankruptcy?
Meta would have to not renew the lease and somehow nullify the residual value guarantee. This would leave the LLC with no revenue at all. If the RVG works there should be no chance of bankruptcy.
you just... file for bankruptcy like any other person or corporation?
Yeah but when you come to bankruptcy court with significantly more assets than debt, they aren't going to let you sell the business for pennies.
I'm asking how you would believe this vehicle would go broke, which is the usual reason to go to bankruptcy.
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