Mr. Bouchard, thank you for the question.
In the case of Tembec, when we went through our plan of arrangement, basically we had the shareholders and bondholders vote on how to divide up the ownership of the company. The existing shareholders got a very low percentage of the shares, about 5%, and the bondholders, who are debtors and who had the security of our fixed assets, got 95%. That dealt with the large debt load that the company could not sustain, but we had no cash and we had no credit. As you know, a company needs cash and credit to survive.
When we went to potential lenders, the first thing they'd ask was, “What sort of security are you going to give me?” It's no different from going to somebody for a $300,000 mortgage for your house. They're not going to give you the mortgage without getting the security on the house, and the security that a company such as ours has is our fixed assets.
If there was $200 million in front of them, which was just about the total pension deficit of the company, they would never have agreed to loan us $300 million, because then they'd have to be convinced that there was $500 million worth of assets in the company that they could sell at any point in time, and that is a very difficult deal.
Unfortunately, when loan agreements are written or bonds are issued in the public credit markets, lawyers are hired on both sides, and the majority of the discussion is about what happens if the worst case happens. Even though nobody believes that the worst case is going to happen--because if they did, they wouldn't give you the money--it's always about what will occur if the worst case happens, and how they can secure themselves. That's where the fixed assets come into play.
That was our real-life example. We could have never gotten it done if I'd had to say that there was a couple of hundred million dollars parked in front of you for security.