The Stifel "research" derided here as made without any evident basis has been updated, according to an email I got from someone watching a Java-based feed to which I can't post a link. Stifel apparently claims ACAS is likely to cave into bondholder demand for a bigger payoff in the exchange, reducing bankruptcy risk.
As envisioned, ACAS' exchange offer would pay down 39% of the company's outstanding unsecured debt, exchange remaining unsecured debt with newly-issued secured debt (at no change in principal value in the unpaid debt; this isn't forgiveness, it's a new debt agreement without the old net asset requirements, but providing secured lender status), and give the creditors a 2% "thank you for your cooperation" bonus on the exchanged principal value in immediate cash.
It sounds like some of the unsecured creditors want more than 2%, or they want 2% of more than just the debt that's exchanged, or something; but they want a bigger cash payoff.
Frankly, ACAS would do better in court. Creditors before a bankruptcy court are only entitled to what they contracted to be paid and not extra bonus payments. Conversion to secured status is surely consideration enough for the removed net asset covenant. If ACAS can reduce interest payments to non-default rates and continue as debtor-in-possession indefinitely, ACAS could outwait the bondholders until their debentures mature and not pay them a wooden nickel more than they bargained for prior to the 2008 liquidity panic drove the air from ACAS' NAV.
Why is it good news that management might cave into extortion like this? Extortion like this is why the United States has bankruptcy courts in the first place. This is exactly why ACAS should file. The 2% should be a reward for playing nice, not an invitation to commit a mugging. Call the law on the bastards!
I'm not sure who's more irrational, the public whom Stifel (correctly) thinks will panic on the news of a Chapter 11 filing, or Stifel for thinking that caving to extortion is good business (better than standing on principle to enforce one's rights in court, which though ugly can be effective). Shareholders want profit, not placation of stranger bondholders. Why should Stifel think placation is better business now than in 1939, or more likely to prevent further unreasonable demands?
When the irrationality-based post-filing panic hits, I'll be waiting at the bottom with my wallet and my margin account.
(If I were certain of the filing, I'd liquidate and wait to re-buy on collapse; however, I'm no short-term prophet and I don't want to miss the upside, so I'll sit through the punches that come while this plays out.)