spoke to bnb

Firstly, I want to start off by saying that we have a very small holding of BNBG. Enough to prompt me to make a few calls, but not enough for me to take it any further. We do not hold any BNB.

I rang BNB HQ a couple of times yesterday and was eventually put through to the voicemail of a lady who the receptionist assured me was handling BNBG enquiries. I left her a message asking for a call back.

A few hours later, to my surprise, I got a call back and this is a summary of what I was told:

1. BNB will contact BNBG holders around 17/18th of February, directly and via an ASX announcement.

2. The announcement will contain details of a proposal to repurchase the BNBG notes from holders at a discount.

3. There is going to be a meeting in Sydney in mid March at which a proposal will be voted upon by note holders. NZ holders will get the same opportunity at a meeting in NZ.

No further details were given. I pressed the lady on the meaning of 'proposal' and 'discount' but she was unable (or unwilling) to give me any further information.

It is obviously from this conversation and the two recent announcements that BNB want to reach an agreement with note holders. We have also been 'primed' with the belief that the notes have 'no' or 'negligible' value and this is probably just setting us up for the low-ball offer that's on its way.

I am absolutely no legal expert in this field, but it feels to me like there is an underlying reason why BNB want to reach an agreement on the notes. This could just be a goodwill gesture after all that has happened so far, but I doubt it.

I think the reason is more likely that management, the board and the lenders do not want BNB put into administration because of one or more of:

a) The cross triggers that exist in numerous other BNB contracts within the group. There are probably trigger events in the satellite management contracts, supplier contracts, any junior facilities that exist, etc.

b) The directors have personal reputation and other risks associated with being on the board of a failed entity. I think our chairperson has already had one other company go belly-up in the past year.

c) On the assumption that seniority of debt only applies in the event of a wind-up, from what I can see BBIPL guarantees the notes but it is not being formally wound-up. If agreement cannot be reached with note holders, BNB will go into administration which means the BBIPL guarantee can be called by note holders and it would become an immediate liability for BBIPL. If BBIPL is not being wound-up, the debt must be paid irrespective of any debt seniority.

d) There are almost certainly other areas where BBIPL has guaranteed contracts for BNB. This would also have trigger events should BNB be wound up, leading to further liability for BBIPL.

This being the case, I would suggest that BNB are keen to get to a resolution on the note holder issue.

If I have one suggestion for note holders, it's to issue an exit notice to the trustee and the company in the next few days. If this does become a long, drawn out battle you don't want to be excluded on the basis that you didn't issue the request in time.