Ann: Results of Entitlement Offer, page-71

Did anybody ever think, from the get go, including management, that $5MM was going to be raised from existing (unhappy) shareholders through an entitlement offer @ 2 cents, given the uptake by retail on the last capital raise??
The sweetener to retail holders was the offer of being able to apply for up to 5X your entitlement, but did they really think we would avail ourselves of that without a bumper announcement prior to the offer closing? IMO, no, and probably because they knew there'd be no bumper announcement!

If they really needed the money from a full uptake, why did they not insist that any shortfall was underwritten? Maybe the lead broker was too scared to underwrite. I certainly would have been after looking at the details of the last raise and eyeing any sophs I had left to pass them off on!
Perhaps they wanted any shortfall shares in their own (companies) hands rather than with the broker?

They now have 208MM shares at their disposal to place wherever they see fit, that's a little over 7% of the company, including the offer.

Who might be looking for that sort of a stake in the company, especially if is just about to turn the corner?

What would happen to the sp if they announced they were placing the entire shortfall with MB, or EV2,3, etc, or SIOI, take your pick.
I'd envisage that it would go north very quickly!

Again, we'd have a lot of very, very, unhappy shareholders, probably because they didn't take up their 5X entitlement in the offer. But at least management could say, "well, we offered it to you...!"

I agree with Sabbath, these people are not that stupid or incompetent.

This is just how business can be done in the corporate world.

It's a scenario, and I'm sure there are others.....something to think about.

As rams is fond of saying, "time will tell, always does!"