Greatcell Rescue, page-35

Hi Hermanity,

I'm really am hoping you can advise where I am looking at this incorrectly, as when you titled this thread as Greatcell Rescue my hopes got raised about not losing my entire investment. I knew there would be a hit taken but your word "Rescue" filled me with some hope.

Reading the report from the administrators it looks like the other proposal includes putting in $2.5m new capital for an 80% stake in GSL (so exiting shareholdings would be 20% of the recapitalised company with $2.5m additional capital). Whereas it appears as though under your proposal, after $2.6m additional capital (almost identical) added under the minimum raise scenario under your proposal, existing shareholdings would only make up 8.2% of the shares in the recapitalised company. I hope I'm reading that incorrectly, but if not can you please advise how come with such similar figures of new capital your proposal would assign less than half of the value of the firm to existing shareholders as the other proposal would assign?

Could you please advise who will be able to partake in the $31,250 Promoter placement capital raise that will net the participants 26.4% of the shares in the recapitalised company PLUS Options for that amount again! Will that just be for members of your syndicate while existing shareholders would only be able to participate in the $1.6m capital raise for 33% of the company (terms that are 41x more favourable for those able to participate in the $31,250 capital raise than those participating in the $1.6m capital raise).

I realise that without a rescue the shares are worth nothing, but raising capital at approximately 1c per share when having already consolidated shares 10 to 1 essentially means raising capital at the equivalent of 0.1c under the old structure. To me it doesn't feel like a rescue for existing shareholders who under this scenario will have lost 99.4% of their value. How is the shareholding split decided upon? It appears as if the proposals just need to identify how creditors will be better off and that you are then able to say whatever you want in terms of what existing shareholders.

Please point out where I am wrong, I hope I'm way off because as I said the title you gave this thread gave me some hope that my take on the report from the administrators just totally shattered.