agm resolution 6

I have grave concerns regarding the proposed Resolution 6 at the AGM on 29/11/2010.

If passed at the meeting this will have the effect of a 10% dilution of value for those unlucky enough not to participate in the share issue. Apart from anything else, this raises the question of who will be able to participate in the issue.

The directors of the Company will be allowed to subscribe for up to 12 million of the 70 million. That leaves a further 58 million shares to be issued. And what criteria are to be used in the determination by the board of who are to be the lucky recipients of this windfall? The Explanatory Statement has this to say under (e). The remarks in square brackets are mine.

1. the level of demand for placement shares [What has demand got to do with it? And, if it has anything to do with it, then how does the Board intend to identify this demand?]
2. the identification of shareholders with a long term commitment to Bounty. [How is it proposed to conduct this identification Is the Board going to write to each shareholder and ask them whether they have a long term or short term commitment to Bounty? And, if a shareholder claims such a long term commitment, will he/she/it then be entitled to share in this bounty?]
3. other issues which the Board may consider appropriate from time to time [This is so open-ended that it is risible. What issues? And who determines those issues for Board consideration?]

I urge shareholders to give this one some long and hard thought.