The CD holders and MM's will do what they want with this until the debentures are completely out of the companies accounts, which won't be until the end of the year.
Very nice post mikey, good summary. Another thing that people need to realize is that while it's true that the CD's won't be completely gone until close to the end of the year, this does not mean that the stock's pps will stay beaten down until then.
I'm reading some posts that are incorrectly throwing this stock on to the pile of many before it that got in to lousy financing deals that actually hurt more than they helped. For both the shareholder and the company.
This isn't your run of the mill "Cornell type" financing deal. If the time is taken to read the last 10Q thoroughly they can find that out. It's actually not that bad of a financing arrangement. There are provisions in place to prevent pervasive dilution, and the CD's can't be all just dumped at once.
Not being able to be dumped all at once is what will give this stock trading habits that will be up and down. Today was the first real clear indicator of CD's being converted. In day's prior to today this stock has been totally manhandled by the MM's to take it down in price and allow them to load their greedy shopping carts.
Contrary to what some think this financing deal actually gets in the way of the stock being run down to nothing because if it gets any lower than the levels we saw today the financiers LOSE money and these guys are definitely not in the business of losing money.
When they have converted what's allowed according to the terms of the deal the share price can then begin to trend back up. When they are converting obviously, the stock will trend down. This is a pattern that will repeat itself until the CD's are gone.
For those looking to get in, or for those that want to add to existing positions, just watch it trade and buy the dips. They will be there. And until the CD's are completely gone there will be a lot of opportunity for people to flip in and out of the stock in my opinion.
Bottom line is thing's are still okay at the company. They are still producing oil and gas, and they are turning the corner towards profitability. The biggest mistake someone can make with this one is to just improperly group this with all the other pennies and pinkies before it that have entered in to bad financing deals. That's an uneducated decision for sure.
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