Nevada Properties is a company engaged in real estate development and construction

Nevada Properties is a company engaged in real estate development and construction. The company decides to make a public issue of a fully convertible debt security that gets converted into a REIT investment within 2 years. The REIT proposes to invest the funds in a portfolio of real estate projects.The REIT has a lock-in of 3 years whence it would be redeemable and its NAV would be published Daily The regulator pulls up the company on the ground of misleading investors. The charge is that the company will convert a debt instrument into a real estate investment with consequent increase in risk without any choice and proper disclosure to the investor. The company claims that it would be issuing

 (a) The public issue is valid (b) Misleading and therefore legally invalid

(c) Legally valid but morally invalid.