Ann: Share Purchase Plan Closing Date Extended, page-583

Every holder objects are different and people need to assess what is right for them.

If the share price recovers to say 9 cents in a couple of months. The options at a strike price of 12 cents will largely be considered close to being in the money with >2 years to roll. They'll likely attract interest from higher risk investors and the price will push up. Personally I think the share price would need to be > 12 cents for the options to be worth 6 cents, given there is a 12 cent strike price plus 6 cent buy price. You are buying shares for 18 cents in effect.

If the options do end up being worth money you could cash them out for you SPP outlay as one strategy. (Free carry shares in that scenario - sound risk management).

Just be aware of capital gains tax if applicable to your circumstances. Free options, 100% taxable if sold in the first 12 months (if in personal name).

I think the biggest risk to holders in this SPP is if it's under subscribed (which by the SPP extension, on going confusion, and shattered confidence of Retail holders it is not looking great).

The company wants $65M - They've already purchased Azer Cel. They need that money one way of the other. If the SPP falls short Paul Hopper will use it as justification not to include Retail holders in future SPP. And the company will likely announce another snap CR within 12 months to sophisticated holders on sweat heart terms with no Retail involvement. (More dilution)


I'm feeling quite shell shocked as I imagined most holders do. Share price down 50% in virtually a month. 95% down in two years.
If you still believe in the company and nothing bad has happened. As hard as it can be to stomach, participating to the extent of the dilution to your existing holding in my opinion is the most risk neutral option here (ie 12.5% dilution - participate to 12.5% of your holding if your finances allow).

If the SPP is under subscribed I'll be looking to cash my SPP captial out lay back out at an opportune time. In readiness to throw it back in for the next CR if and when that happens.

**In my opinion only. Not financial advice. Seek professional assistance if required.