Ann: Binding Commitments for $2million Capital Raise, page-7

"Price action + volume intent since the start of April could suggest some were in the know of this pending dilution on the cards" – The only two realistic possibilities were insolvency or capital raising on ruinous terms. That made selling the only sensible action because the only two realistic outcomes were avoiding insolvency or being able to buy back at a considerably lower price.

The only thing that surprises me is that they didn't consolidate as well as raise capital. Perhaps there was no prospect of getting better terms on the raise after consolidating.