Well, I understand where you are coming from.

But when you have a mine already under construction, planned to open this year, and with estimated free cash flow of over 100M per year, I think the "huge" involved is rather overstated.

In other words, in the general case, your statement is generally true.

In the case of Silver Standard - a specific case -, given the high probability of large profit (IMO), I think an intelligent (but not risk averse) investor would jump at the risk/reward ratio represented in this particular situation.

If, on the other hand, one believes that there is little chance of the Pirquitas mine meeting expectations, then this might be considered a "huge" risk.  If that is so, however, one should completely steer clear of Silver Standard.  If it cannot make Pirquitas very profitable, what will it do with all of the other properties in its portfolio?

In other words, your decision to invest (or not) in SSO should be based on the expectation of the forecasts for production being accurate rather than on how much risk this convertible offering adds to the mix.

If the mines don't work out, SSO is probably in big trouble anyway.   If they do perform at or near forecast expectations, the convertible notes do not add much "burden" (as opposed to risk - I *do* know enough to know the difference between burden and risk)