1. Gingerbread Ltd is an Australian Securities Exchange (ASX) listed company that is currently undergoing an equal access share buy-back scheme. The market price of Gingerbread Ltd is currently $14.50 per share, while the share price has been appreciating steadily in the past two years by an average of 10 per cent per annum. The off-market buy-back price was announced at $14.00 per share, where the capital component of the offer is $6.00 per share and a fully-franked dividend is $8.00 per share. Corporate tax rate is 30 percent. A hedge fund, Orion LLC, has become a shareholder in Gingerbread Ltd by acquiring a 4.5 percent ownership in Gingerbread Ltd over the past year. Orion LLC has also rejected participating in this buy-back scheme at the current share price. Orion LLC however made a counter offer to Gingerbread Ltd last Monday to tender all its shareholdings in Gingerbread Ltd at the price of $14.60 per share. Orion LLC has then been accused of 'green mail' by Gingerbread Ltd management. 

Discuss the following:

a) Outline possible reasons why Gingerbread Ltd management accused Orion LLC of 'green mail'. 

b) Advise a domestic retail shareholder (who has a marginal tax rate of 32.5 percent) and a superannuation fund (15 percent tax rate) whether either of them should participate in Gingerbread Ltd's Equal Access share buy-back. Assume that shares in Gingerbread Ltd were bought by the retail investor and the superannuation fund several years ago at a price of $9.20 per share.