Barkerville Gold Mns Ltd BGMZF

RE: RE: RE: RE: RE: RE: Rex Harbour

[RedHorizon]

GoldExecute:

I think your misunderstanding how dilution works.  Dilution only reducs the economic value held by shareholders who do not buy a prorata number of new shares in any new equity raise.  If Rex Harbour buys all 50 million shares he suffers no dilution.  He goes from owning 5-6%% of the company to owning about 31% (57 million/185million). 

If BGM has a value after the 43-101 comes out of let's say $2 billion, then each current share will eventually be worth $15 ($2B/135 million shares).  His current position would be worth a little over $100 million.  If he gets an additional 50 million shares then each share of the company will be worth only $11/share ($2Billion/185M shares).

Then he has 57 million shares.  His position value would then be about $627 million.  He has increased his asset value by $500 million with an investment of $50 million.  The rest of us who don't buy more shares now have lost $4/share of value ($15 versus $11).  This is where Rex is gaining his $500 million, FROM THE REST OF US!  WE are diluted, not him.  And the deal is even worse for us if he exercises the 50 million warrants at $1.35!

Good luck to all longs other than Rex Harbour and his accomplices.