Ann: Trading Halt, page-77

The capital raising is a good test for this company.

$6.5 million is a fairly big ask for a junior of this size and also considering it owes a similar amount to its funders. On the face of it, it would seem quite a difficult ask if things aren't stacking up for the company.

If they manage this amount easily it means they've spruiked a pretty good story.

You've got to remember that any UG mine whether its starting from scratch or reopening is going to require development capital. So far KDR have started mining (and exploring) Burbanks on a shoe string budget. This isn't an easy task trying to mine while proving up resources and in ordinary circumstances would require far more money than KDR have put in. That's what makes them unique in some respects as they've broken the mould and gone mining without proving up significant resources which otherwise would have delayed the mining for a very long time and chewed through cash for exploration. This either means the directors of KDR are totally bonkers or have a lot of faith in Burbanks to deliver. When I bought into Kidman I knew this was a fact so bought with my eyes wide open. The mines in these districts have proven they can keep on giving and over the last 10 to 20 years the norm around Kalgoorlie is to go UG as open pit opportunities have all but disappeared. Many mines have done exactly this and have gone deep and are still mining ahead after more than a decade of production. Nothing much has changed for KDR in my opinion. They tell us they are approaching some high grade lodes and all we can do is believe them or sell our shares. The accusation that they don't inform shareholders is false in my opinion because as far as I'm personally concerned they have articulated their plans for getting Burbanks going pretty well and also highlighted the prospectivity at Gunga and other prospects in the Coolgardie tenement group.

Let's see if they can announce this raising. If they do it strengthens the balance sheet and gives money to fund the Mt Holland purchase which on the face of it we are buying for about $3.50 per resource announce (about 1Mozs). It doesn't get much cheaper than that. For people who have followed some of my research at the mines department, the main tenement alone at Blue Vein has had about $6 million expended against it (from memory) so on this metric also represents very good value based on a $3.5million consideration for the over 50 tenements and infrastructure leases (roads) that connect them.

If the truth is that Burbanks is actually struggling and they are struggling to bed down the raising then we are in a less enviable position as we might face our own VA or be again calling on Capri to ensure we remain a going concern. That's also the problem when moving from mining to production. Its not as easy to sink an exploration company as they can just go into a state of hibernation. Let's hope that these less positive scenarios are not the case. We will know soon enough.

As far as the resident pest goes he/she has been useful to bring certain information to the forum but much of it has been very misleading as I've shown on a number of occasions and there is some good chance that he/she is connected with the opportunist forfeiture actions. The parties bringing those claims would need to have either significant legal knowledge or significant funds to take these claims forward or be backed by people with deep pockets. From what I can tell their claim, at least, over the main Blue Vein mining lease is bound to fail (IMHO). Just ignore the pest.

A quick announcement and a lifting of the trading halt will be good news. If we go into suspension then we will have a pretty nervous wait.

Good luck to all shareholders.

Eshmun