Starting up a network can often take hundreds of millions, it is true. So $35 million in debt capital is not a problem in itself. The problem is that it resulted in only $20 million in assets (and that's their book value; their liquidation value is likely even less, only around $5 million) and a badly damaged company. It was poorly spent. To shareholders, that $35 million is a millstone and is why we've been diluted so significantly. That's why Olsen lied about it, implying it was only around $7 million.
That wasted capital is a sunk cost; we shareholders bore its cost and our upside is now severely limited by it unfortunately.
I really hope that the debt had been converted into all those new shares. That would be the one saving grace here.
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