ALERT: Super Smelly Debt Instrument Issued, page-3

I agree that it would be nice to have some more clarity on the criteria management will be using to issue these options to debt holders.

And I would somehow suspect these debt holders do have some additional clarity, otherwise 5% is probably not the market rate for unsecured debt issued to a company with no revenues, burning through cash.

Though if the disclosure is to be believed and the management ethical (bit of a question with Steve, maybe) then presumably they would only issue the options in March if they think they need the funding generated if/when exercised given other capital raises they may do in between.

Don't forget it was trading at 13.5 prior to the halt to raise $1.66M at closing price (not typical) would have meant an issuance of $1.66M/0.135 = 12.3M... so instead we, subject to some unknown conditions, will issue 16.65M shares at some point in the future and raise a net further $16.65M*2 - $1.66M = $1.67M doesn't seem like a terrible deal to me?

Also, can't complain about the market reaction... I don't think it would be up 40% without this debt issuance... but it's impossible to know. Remember, it costs money to drill... and we were running a pretty low.