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Backwash

09/28/07 3:11 PM

#1348 RE: puppman #1347

Puppman is right: shareholders are held hostage by the continuing threat of dilution. That prompts investors to take early profits and run, before BOD issues more shares. BOD should address this concern with, say, a 5 year moratorium on share dilution, coupled with policy to give s/h fair notice of impending dilution, and other options to protect s/h investment. Of course, a lot depends on how the BOD spends capital raised by selling more stock. If it's used to by mineral rights at fair market value, s/h equity should increase in proportion to new shares issued; i.e. p/s unchanged.