system
A chat on subreddit /r/wallstreetbets
human
I'm so glad that someone is actually putting critical thought into my post. To cite the referenced SEC document, the LTV Ratio is defined as "Net Obligations divided by the Aggregate Collateral Share Value," where "Net Obligations" are in turn defined as "Loan Amount plus accrued and unpaid interest minus the amount of Cash Collateral minus the cash value of any Shares sold pursuant to a Permitted Sale Transaction that remain in the Collateral Account pending settlement." So the LTV Ratio is, effectively, the initial value of the loan ($12.5B) plus accrued and unpaid interest (which we will assume is $0) minus the amount of "Cash Collateral" (Mr. Musk could have/would have, hopefully, put up some amount in this honor) minus the "cash value of any Shares sold pursuant to a Permitted Sale Transaction that remain in the Collateral Account pending settlement," that is, minus any shares he has (since) sold to offset this amount, all divided by by the "Aggregate Collateral Share Value," which is the sum total of the shares (i.e., stocks) put up as collateral for this loan. As is stated on the line "Maximum Initial LTV Level," equal to 20%, the minimum share value that Mr. Musk could have put up as collateral should be equal to no more than 20% of the net obligation. So if the net obligation is $12.5B (assuming Mr. Musk put up no cash as initial collateral), the minimum share value he would have been able to put up as collateral would be a value such that 20% of those shares equal $12.5B, or $62.5B worth of shares. Assuming that he put up $2.5B in cash and wanted an initial LTV ratio of 12%, this would yield a share value of $66.7B in collateral (such that 12% of $66.7B equals the $10B of net obligation).
gpt
Didn’t read any of this shit, but how do you know this? You a bean counter?