I'm not following your logic here? The option for an explorer is...

I'm not following your logic here? The option for an explorer is to go and do a placement at some sort of discount with the broker taking the using heavy leakage on the way through before they dump the stock. The deeply discounted rights issue model has been deployed into other companies usually with good success. Why? Because the shareholder has the opportunity to refresh his/her/they/its (sigh) position at a discounted price. In this case, if you are a shareholder you can buy 1,000,000 shares for $2k. If you are exposed at a much higher price and like the potential, pay the money and refresh your price down. The notion of a rights issue is to also hold the line to the greatest extent on the amount of shareholders "on issue" in the face of more shares being issued. ie, there is a far greater modicum of loyalty to be found through a rights issue than there is through a placement. Lets say a placement may have been completed at .004 along with attendant commissions, performance shares blah blah blah...to my way of thinking the "dump" would have occurred immediately and been far deeper in its negative price effect. Apart from that, I guess the two questions you could ponder are: 1) what alternative to this do you suggest?; 2) where are the guarantees in mineral exploration?
DYOR.
Cheers