Rights Offering The reason that you would take up a rights offering is that if you didn`t, the value of your existing shares will drop and you will loose on your current investment. (See Polo`s link to wikipedia). Also, if the newly issued shares are voting shares, one would assume that if this board went ahead with an offering, GH would intend to exercise those rights. If they do, but a significant portion of minority shareholders do not, it will increase their control of the company. The reality is that there will need to be more capital to get the value out of the ground, and this will come at a cost to shareholders. If this board, under GH`s control, do this when shares are in the basement, it will increase GH's control at low cost (without actually raising much capital). If they come up with a DFS, show up with the $ required under the current agreement and shares have risen appropriately before an offering, the funds raised by an offering would be more significant, and would perhaps warrant the dilution. This also points out the advantage to minority share holders of the previous plan of developing the the North Zone first ( Capital Requirement ~ $ 50 mill) vs the Fire Tower Zone (Capital Requirement ~ $ 150 mill). The previous plan to use profit from mining the NZ to finance the development of the FTZ involved much less outside capital requirement and the dilution that goes along with that. It also effectively reinvested the proceeds of the initial investment in the NZ in another good investment, the development of the FTZ, adding significantly to the overall value, particularly for minority shareholders.