I guess IF I was a KRY noteholder, I would have a few options at my disposal:

1) force the company into bankruptcy, and spend time inlitigation for the next year, and in turn hope that I could get control of whatever assets the company has and sell them off at a decent price to cover my principal. I guess, if successful, I would have to sell off the arbitration claim or take it the distance myself.

2) Negotiate with company to have my notes converted into shares. Becoming a significant shareholder, I can then request that the company sell off any unecessary assets, and use the funding to get through the arbitration process, and hopefully get a settlement that will reward me as a shareholder, although the company may have significant shares outstanding.

3) Buy shares on the open market at 0.15 cents each. Announce that the loan has been extended until 2014 (or whenever arbitration is expected to end), and continuing to get interest payments in cash or shares of the company in semiannual payments. The shares I purchased on the open market can be sold at a profit as the shares purchased will most likely have risen after the overhang of bankruptcy is lifted. I get some immediate potential profit, plus the potential of further income and shares down the road, and return of my principal if/when the arbitration claim is concluded. If the arbitration is looking good, the value of my notes also rise. Dilution of shares is minimized.

4) sell my debt to someone else on the open market. Possible making a gain (if i bought low).

I could have missed some strategies, as there are any number of ways this could be played.

Obviously, as a shareholder, I would prefer #3. But this is only if we don't have some other plan (i.e. joint venture is still good) before arbitration.

FK