Ann: Issue of Ordinary Shares and Options incl. Appendix 3B, page-4

CC: I'm not quite sure what concern/issue you are referring to re the 50%. But if it's the 50% condition required for directors to take up their full entitlement, are you then saying you think they have taken up their entitlement in full (excluding the MD of course)?

My concern re the 50% condition is why it was inserted at all. Did the 2 directors concerned genuinely want to support the situation we're in ? The notice of Jan 22nd said we had reached approximately 49.4% of eligible acceptances. It also said that Abbotsleigh had taken up its full entitlement (fair and open). No mention of the other directors; leading me to believe that they haven't and that perhaps they had no intention of doing so. .. My sincere apologies if I am wrong (to doubt their intentions).

I think we all understand why events and confidentiality have led to this diminution in trust by shareholders. As already pointed out the ORS rights issue was similarly unsuccessful. In their case the advised intentions for use of the funds raised was, inter alia, to be the development of Alliance South. Shortly thereafter all the Victorian assets were on sale to AYC (not saying this is a bad deal, but contrary to the intentions given to shareholders before the rights issue).

And on another note, though not to add to FO's worries I hope: everyone would have seen that under Listing Rules 7.1 and 7.1A, and in addition to the options, the company still has the capacity to issue another 93,147,303 shares ...