Ann: Market Update, page-106

No wonder people hate convertable notes, they are confusing as all F..!

What does this pearler mean, taken from the agreement..

Mandatory prepayment

If the Company raises funds via issuing debt or equity or other
means, the Investor may require repayment of:
• in respect of a debt raise, up to the net amount raised by
the Company; or
• otherwise, up to US$1,250,000.

What the? Does that mean that if the Company raises funds during the convertable note period, they have to give it all to those chumps?

Is this what stymied the placement?

Somebody with some nouse here, please explain..