update, page-66

I've been a little quiet of late but have been in contct with Retrac for almost a week.

I have taken particular note of the update info provided by agent.

If JJdP is the vendor of Starloop, the company acquired by SBR in 2012 (news release 10 May 2012) and indirectly holding (80% of)the tenement licence, then he will be due at least a further 25m SBR shares as consideration for Starloop and, if the JORC estimate is of in excess of 150kt of Cu (inferred), he will be due an additional 5m over the 25m, to take him up to having a 39% holding in SBR.

Several points can be made:

1. Once the JORC is published, the company will be all but bid-proof - a predator would have to get over 80% of the shares in public hands just to seize bare control. One would have thought that that would make JJdP feel more comfortable, not less, and so one might assume that he is keen for a meaningful JORC to be published.

2. JJdP's current holding is quite sufficient to block any special resolution. In practice, it would be difficult to gather the backing of sufficient shareholders to secure the passing of an ordinary resolution of the company on a poll.

3. Kombat Copper is TSX listed and that would make any merger or takeover of, with, by SBR a complex affair.

4. Copper is not flavour of the month at the moment and that's not SBR's fault, though they might have caught the train before it steamed out of the station - but that's spilt milk, so as to speak. A rich JORC estimate might not do sufficient for the share price at the present time. An 'inferred' estimate is a first step - they need then to convert it to 'indicated' as a next step and that will require further drilling. So, further capital will be required.

Unless SBR can regain market credibility and get backing from one or more funds, it will have to attract in a JV partner, for Guchab at least. That's my view FWIW.

Personally, I cannot see funds investing in a company alongside a dominant private shareholder unless a strong, independent BoD is put in place and the dominant shareholder's voting rights are contractually constrained.