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Gold/Mining/Energy : Harken Energy Corporation (HEC) -- Ignore unavailable to you. Want to Upgrade?

To: Razorbak who wrote (3414)	8/16/1998 11:13:00 AM
From: SDR-SI	Read Replies (2) \| Respond to of 5504

I think I understand most of your post, but I get lost at the end and at the apparent conclusion of impending disaster that you have drawn. Please let me know where I have gone wrong. The announced increase in NAV from your referenced 1997 post to date (24MM boe on 122MM shares) would apparently make NAV somewhere between $3 and $4. This is the level at which we are, as you have indicated. There are two "floorless" financings amounting to a total of $50MM ($15MM + $35MM) in which the "floorless investors" can gain more shares if they force the price of the stock down. There is another financing ($85MM) that some people have lumped in with the above "floorless" financings and called it a "floorless", apparently to make the company's situation look more dire; but this financing's floorless attributes can be activated ONLY AT THE OPTION OF THE COMPANY and clearly do not have the negative "floorless" implications of the prior two floorless financings or of the now-traditional "floorless" definition developed by Zeev. The company has $178MM of working capital, with $15-20MM apparently now allocated to a stock buyback and, even with a substantial amount allocated to a very ambitious drilling schedule, clearly has the cash to take out the two dangerous "floorless" financings ($50MM totals), if it wanted to and if it saw their existence as a precursor of an inevitable "death spiral" for the company. How does this get one to the "look out below" conclusion? Where am I going wrong? TIA Steve