mkt value 2 years ago and today, page-32

Petergm

The director in question is Mr Gordon Saul, who is also sole director of Resolve Geo which holds 74,646,453 or 14.12% of BND (62,846,110 + 11,750,000).

3rd Jan 2013 - As part of a financing arrangement, Resolve Geo Pty Ltd has entered into a structured loan facility, which includes a collar arrangement with UBS AG.

Resolve Geo mortgaged 11,750,000 of its shares to UBS in order to secure the financing, it has not reduced its holding in the company.

Imo at a guess (I stress guess) he needed finance for either his Resolve Geo entity or to cover a margin lending arrangement.

What is a "collar arrangement"?

UBS Collars enable holders with concentrated equity holdings to protect the value of their shares and access loans at competitive interest rates.

How do Collar strategies work?

A standard Collar strategy protects the value of your shareholding at an agreed floor price. To achieve this, shareholders forego share price gains above a predetermined cap price.

Monetisation

Shareholders who enter into Collar arrangements may wish to borrow an amount up to the protected value of their shares on a limited recourse basis from UBS. This provides an immediate cash in-flow without triggering a capital gains tax liability. If, at the end of the investment term the value of the shares has fallen, the Shareholder may hand over the shares in full satisfaction of the loan.


Meanwhile if someone came along and knocked on the door of UBS and requested a line of BND stock (say 11.75mil) that they could borrow for a short position, then UBS would gladly do so, for a fee or course.