Hi Samdina, Nathan is correct, LaJolla are in the business of...

Hi Samdina, Nathan is correct, LaJolla are in the business of making money by providing short term finance in return for shares which they will generally sell quickly on the market. I am surprised to be honest that we have not already seen the change in substantial holding notice as I figure they have already sold a few over the past few days and even on the day they received the shares. They do have a few days to submit the change notice to the ASX. One good thing about the change notice is that we will then know how many shares they hold. The shares they received on 6/2 must've been sold immediately as they did not appear in the sub notice.

LaJolla are definitely the reason the price is suppressed.

Nathan I agree with all you say except that the 20th Feb meeting is actually to approve the issue of the remainder of the shares, not to ratify previous issues, and this, including previous announcements, means if they need to they can now do the following:

- issue shares @ 5c to directors in lieu of fees

- issue shares @ 5c to consultants in lieu of fees

- issue shares to LaJolla in respect of the remainder of their $1.5m convertible note @ 80% 5day vwap

- issue shares of $1m to sophisticated investors @ 80% 5day vwap

And they could do all this pretty quickly at the same time. IMO all of the above is needed to move forward and allow the company to be debt free, Lajolla free, and have $1m in the bank. Yes it will result in a lot more shares on issue (depending on the issue price), but still so very, very few compare to the likes of Biotechs ALT, BLT, ANP, PRR etc

Also hotcopper member Scops04 received an email recently from Peter Young (CFO). I've copied Scops' post here:

"I received an email from the CEO, I sent a general inquiry on what was the plans for 2012.

This was his response.

Our plans are obviously and inevitably a function of successful capital raising and follow this basic outline:

1. complete an initial capital raise to allow the company to replace its current convertible-debt funding with new equity support; this should allow the stock price to recover (this part is reassuring). For the past year we have been entirely dependent on our loan facility with La Jolla Cove Investors, and this remains the case now.

2. bring in a moderate follow-on raise that allows us to begin moving some of our clinical-stage product programs forward again, regaining some momentum and product progress that can drive value growth

3. follow with a third significant capital raise that will fund product development to the end of PhII clinical trials, a major value milestone and strategic value driver."


Also one last note is that based on the email above, BNE are able to get out of the contract and there may be no need to issue the remaining $4.5m notes if alternative funding is found. I am not sure if there is a clause in the note agreement whereby BNE can terminate the agreement if the price is trading below "floor price"

Anyway this week saw the patent announcement which gives me confidence that the company is still progressing and the price can spike nicely. I am sure it would've held much higher had it not been for LaJolla selling.