The bond deal is about 100 times better than equity, imo. After thousands of posts decrying the overhang and dilution, I'd think the company floating a viable alternative, would be embraced wholeheartedly. It won't be easy. What would you want to fork over $15M to a company with no cash and cash flow negative?
But this kind of deal almost eliminates the overhang problem. First, there will be far fewer warrants than there would be shares issued, maybe 1/4. Secondly, they can be restricted and can be at above market prices. And if done after a FN listing or other catalysts, perhaps at a much higher price than current.
Net, net, the company might owe 10% +/- interest on 10% of its 2013 cap ex budget + eventually add 3M shares, maybe less. Equity with the same assumptions would add 12.5M shares, and sooner. But issuing equity in and of itself would be likely to mean getting a lower price. Getting a bond deal in and of itself would also likely improve share price and prospects.
So the ratio of new shares between the two alternatives is more likely 5-1 or 6-1.
Selling HU is off the table, I'm sure.