Hi all,I will make this as clear as possible. A capital raising...

Hi all,

I will make this as clear as possible.

A capital raising is a staged process. It is first announced, any underwriting is secured to ensure success, money is contributed by shareholders, underwriting commitments are then tallied, and any shortfall allocations are calculated and made and finally the company makes an announcement as to the end result. We are currently at the "underwriting commitment tally" stage. In fact the contract re subunderwriters legal contributions was settled yesterday.

The ASX announcement today regarding the rights issue was no more than a legal requirement reflecting the conclusion of this stage. The key figure for the underwriter to the issue, Patersons Stockbroking was $2m. It was reached officially yesterday when the subunderwriters met their legal commitments,albeit at the lower scale of what they would have liked by paying the cash that was required under their respective subunderwriting contracts. It is called contract law.

Given the excellent support of shareholders generally,this final obligatory commitment level of the subunderwriters came in far less than they anticipated and effectively reduced the obligatory amount for subunderwriters as per the agreements from 100% to 43.9%. Whilst that was reflected in the fantastic effort by the SBN shareholder group, it meant that the subunderwriters did not get what they wanted!. So the announcement today simply rules the line under the min $2m that was required by SBN. Done and dusted!

The next and current stage now involves satisfying the subunderwriters who did not get what they wanted because of the great support from the SBN shareholders. To do this, they must apply for the shortfall through a proces of contract which they are doing right now. I should know, I am one of them! Most subunderwriters will be applying for at least what they wanted in the first place. Whilst this can not yet be announced because all the subunderwriter cheques have yet to be received, it should creep ever so close to $3m mark give or take 100k here and there!

For a company to have a successful capital raising in this current environment to the tune of around 90% acceptance (through the contributions of both shareholders and underwriters) is simply quite staggering.

For those who spat the dummy out this afternoon through their own foolish ignorance and misunderstanding and sold their shares down, I am sorry for you! Buy them back tomorrow if you are serious but try to remember that one must be patient in adversity!

Probably next week sometime when all the processes have been concluded and ruled off, the management of SBN no doubt will be in a position to announce to the market the results of the capital fund raising and provide more details as to the final takeup rate and additionally provide an overview of the way forward now for its fully funded company.

I think that you can expect that such an announcement will indicate anywhere between an 85% and 95% take up rate and anyone connected with the company be it shareholders or Directors can feel well pleased with where SBN currently sits in the overall scheme of things.