Sorry, maybe i should change my profile to detail what i do now. Did i mention i work in venture capital? sorry, my mistake.
With regards to my being 'naive' i think you need to take a deep breath and read the post again. It illisutrates the different points of view on this issue.
By placing second mortgages on properties, you are really just reiterating what i mentioned in my post:
''Its called lock in money - if me as a bank knows that the company failing is really going to hurt you financially as an individual, i am more inclined to think you will work your nuts off to make it suceed, and consequently i am far more inclined to come to an arrangement to back your buyout.''
Emerald is a fairly unique situation, with an odd aircraft fleet, large company engineering setup and mindset with small aircraft numbers, very well trained staff who have lost an AoC over training issues, and an odd management oversight system.
Also, debt and /or equity are not semantics - thats a very silly comment. Equity costs nothing to service, and does not affect cash flow. Debt requires servicing, and therefore draws money out of the company.