BBTV Holdings 7 Unsecured Convertible Debentures T.BBTV.DB

RE:RE:Cantech Letter

[optimalmarket]

Your analysis is again flawed, probably because all 16 of your posts since you formed your account on May 12th are bashing BBTV.  Clearly you have a heavily negative bias and aren't a real shareholder, zero credibility.  

Now lets break down the challenges with your analysis.  First of all out of the $65M financing package that the company announced, only $15M of it was a bought deal, $20M of it was purchased on a non-brokered basis by the trillion dollar asset manager and $30M was provided by deferring the rest of the existing debt out by 5 years at a lower coupon which then converts at a premium (20%) to market if not paid back.  

Trillion dollar asset managers do not short stocks, it is not in their governance capabilities to do so, thats why it was brilliant to bring them on.  The bought deal participants would likely not consider this at least until the exercise price of the convert is realized ($10.55) otherwise it would be illogical to buy the convert just to short it, one could just find borrow out there instead.  Especially considering there is absolutely ZERO reason to short this stock anymore, anyone that does so is a moron.  The only reason why people were shorting it before was because the presumption was that the company had to deal with the debt load and the only way they could do that is do a big dilutive financing but they didn't, they were able to get something done that maintained the integrity of the cap structure. 

Its basically a perfectly well executed convert.  Its not convenanted debt that is an equity like instrument, the company has 5 years to convert it or pay a low coupon of 7%.  Its absolutely brilliant.  

The $65M financial package showed remarkable financial sophistication, they added $65M of financing restructing to the balance sheet, completely solved the pending escalating rate debt problem  with only 3.31M shares of potential dilution and 5 years to pay down the other senior debt with a low coupon and no repayment penalty.  This is simply NOT a deal any tech company can pull off.