financing
When I read the financing news, I wondered why the Note's maturity date wasnt disclosed in the press release. Whenever a Zero Coupon Bond is issued like this, the DISCOUNT from PAR is amortized over the term of the Bond. Without knowing the TERM, you don't know the implied annual interest rate.
It turns out the Note matures in December of 2008. The implied interest rate is 6.5% per annum (plus whatever cost you attribute to the options issued)
From a straight financing perspective, and given the situation, this is a fairly respectable cost of funds. I would have preferred to see the share conversion price set in excess of the market price, but I guess they just didnt have any leverage.... or perhaps they just didnt get good advice.
Either way, they needed the money. If they pull off the deals they have been trumpeting, then this financing just wont matter.