RE:Cantech Letter Another smoke screen for this company. The debt holders are priortized over shareholders. This debt is very low risk for the bond holder and they get a 7% return. Meanwhile they got a call option sweetener.
If the company's share price does well the company forces a conversion (and dilutes shareholders) without bothering to do a public share issue. Then they roll over the debt to a new bag holder.
Meanwhile the current debt holder could do very well by shorting BBTV. They are guaranteed to make money should the share price stay flat (earn 7%), drop (earn on the short), or rises (hedges the risk of the short from the call option and continue to earn at least 7% minus the hedge cost).
If it's a good deal for the debt holder .... then it's likely a bad deal for the company.
But BBTV is great at marketing spin and this is another example.