Southern Pacific Resource Corp STPJF

ROH or STP Shares The Better Deal?

[scissors14]

Trying to decipher this deal:

Southern Pacific will acquire all the issued Rochester shares through the issuance of 21,000,000 Southern

Pacific shares. As of May 28, 2008, there were 50,575,645 Rochester shares issued and

34,629,187 Rochester shares issuable upon the exercise of Rochester convertible securities.

So multiply 21M STP shares times their market price and divide by 85M?  Might even be more ROH shares to take into account because...

Each outstanding Rochester warrant and option will be exercisable into Southern Pacific shares

upon the same terms and conditions as the original convertible security after taking into

consideration the Exchange Ratio. The letter of intent provides for an adjustment if Rochester

does not meet certain working capital covenants on the closing date.

If the above is right then ROH shares should be worth at best 22 cents?

Please correct me if my logic is flawed.