Cardinal Redemption of Convertible DebtJust trying to understand this transaction. If you assume that 100% (to keep the analysis simple) of Convertible Debt is converted to shares at a $1.25 I see this transaction as a positive from the cash point of view. They will net out $28.2M of cash that can be used to reduce the LOC and / or fund more drilling given the increase in oil price ? Also, they will save interest expense of $2.3M. The offset will be share dilution of 19.9%. Am I missing something ? Thanks........
| Current Convertible Debt | 28,207,000 | 8.0% | 2,256,560 | | | | | |
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| Redemption of Convertible Debt (100%) | (28,207,000) | 8.0% | (2,256,560) | - Assuming 100% conversion will save interest expense | |
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| Convert to Shares | 22,565,600 | 28,207,000 | $1.25 | | | | | | |
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| Current Shares | 113,495,658 | | | | | | | | |
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| Revised # of Shares | 136,061,258 | | | | | | | | |
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| Share Dilution | 19.9% | | | | | | | | |