I have a clue, join the rest of us. When they convert the stock, it is a debt conversion. The books reflect the value they convert at. Converting at below par value (as you have been stating -- getting a discount) would show in the books. Knowing a little about accounting, you now realize that the books would show conversion at below par. I would hope you could figure the rest out. You don't need to believe me though, you have different motives than many of us here.
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