Ann: Appendix 3B, page-8

When companies want to raise money they can do it through debt or equity. Most people are familiar with how raising money through debt works in that someone lends you money and you repay that with interest (think of a mortgage on a house). When companies raise money through equity, they ask an investor for money in exchange for giving the investor a slice of ownership in the company, in the process creating new shares. This is an example of BCN raising money through equity.

If you remember when BCN raised capital in the past (on a few occasions), we had the opportunity to give BCN money in exchange for receiving additional shares in the company at a fixed price, proportional to our current holdings. In addition to this we also received listed options in the company (BCNOB) for free. We have a few choices when it comes to deciding what to do with our BCNOB options:

1. Exercise the options before 17th August 2022 at $0.025. This means for however many options you have, you pay $0.025 for each option to BCN and they can use that money to run the business. In exchange your options become newly created shares in the company.

2. Sell the options through your broker.

3. Do nothing and let them expire after 17th August 2022.

In this example, someone has opted for the first choice which means:

1. There are an additional 104,377 shares in the company.

2. BCN have an additional $2,609.43 in cash (104,377 shares * $0.025 per share).