Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Vernon Plack - BB&T Capital Markets.
Vernon Plack - BB&T Capital Markets
Thanks very much. Malon, I’m trying to get an idea if you could perhaps quantify the fact that you’re going to have higher interest cost going forward. I think we all know that. I’m just trying to get a sense for, is your effective cost of debt at least what we know right now, is that going to go up couple of hundred basis points, 400 basis points? I was looking for some color there. Please.
John Erickson
Yes. Hey Vernon, it’s John. I think you could assume probably 200 basis points as a reasonable guess on that.
Vernon Plack - BB&T Capital Markets
Okay. Next question relates to the dividend. I know you have the payout of the $300 million, and I know there’s a limit on 90%, and also to limit that, I know you will authorize up to roughly 42 million shares in terms of being issued. Is that related or could you in theory issue 90% of that $300 million at theoretically any price if you had to do so?
John Erickson
It is not related to the selling shares below book. So, we could in theory issue 90% of our shares at whatever the current price was to meet the dividend requirement.
Malon Wilkus
Vernon also I would mention that we will be looking very hard at the question of whether it’s 90-10 or 80-20 or 70-30 in terms of stock versus cash in that dividend. We know it’s a very serious issue, our Board is taking it very seriously.
Operator
Your next question comes from the line of Sanjay Sakhrani - KBW.
Sanjay Sakhrani - KBW
I was wondering if we could dig a little bit deeper into the ACAS and the defaults there. What exactly caused that default kind of how many parties are involved and what’s that total amount outstanding over there that’s under default?
John Erickson
I think you can imagine. This is some of same things we’ve experienced in the U.S., both increasing credit issues and declining intangible net worth. So, if you look at what’s going with the BDC’s in the U.S and the type of pressures, it’s very similar to what we’re seeing in Europe. So, the asset values have depreciated there and defaults have gone up and so that has triggered defaults within their facilities.
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