market cap and nav, page-111

Sue, there is no way pref holders would contribute more money into BBI via a rights issue. They have already been stung for $1 of cash.

This would have to be done by a major player coming in and underwriting the issue, or more likely 2-3 major players, because none of them would want to go past 20% a trigger a compulsory.

I think 5 BBI for your BEPPA is very hopeful indeed. I am more at the 2-4 level.

I reckon they would better off throwing in some warrants to be exercised in 3-4 years time as a sweetener, eg say give out 3 BBI and (say) 1-2 warrants at like 20 cents or so, to allow the pref holders to participate in a recovery in the share price if it happens. Or even stagger the warrants, eg 1 at 20 cents in 2 years time, 1 at 25 cents in 3 years time and 1 at 30 cents in 4 years time and so on. If the company starts to recover and you don't want to put in more capital, sell your warrants and pocket the cash.

Just a thought. It will depend on whether this caps the upside too much of any new players coming in with fresh capital.

Anyway, time will tell. Undoing the death spiral is the solution to the problem.