The dealThis deal means they are getting interest from the big guns. They are essentially converting all warrants to shares, and penalizing anyone who cannot afford to convert. You can either tender the shares and receive shares at $7.80/ea + $1.5 in cash, or if you can't afford it or do not want to exercise the warrant and you get $0.75 in cash per warrant and a percentage of a share based on the market price (i.e penalized).
IMO, they are doing it to save the warrant holders (themselves and the bigger investors) from completely losing all time value in the event of a takeover. They certainly don't need the money, although it does clean the balance sheet.
The stock remains an excellent stock, but this may put a damper on the price until things are cleared up. The next question is, what will they do with the debenture holders? I think I'd rather own stock at this point.
hockeylad33