1.2 cents, page-21

Hi Bouzouki,

Fair question there. Ok so OBJ are gonna issue 106 million shares as part of this issue. If none of the shareholders take up their rights, Novus et al will have to pay $1.06 million to the company and salvage what they can with the 106 million shares in their lap. If they keep the share price above 1c, they make the share issue more enticing for shareholders so that it attracts subscriptions and possibly oversubscriptions.

Since the stock went ex, approx 50 million shares have been traded. Suppose Novus bought about half of them, 25 million, their total cost is 25 million times the share price. They get applications for 60 million shares, and pick up the shortfall of 46 million shares. Their total purchase is 71 million shares.

If they let the company share price collapse to below 1 c, they will have to buy a 106 million shares @ 1c.

So potentially they save having to buy 106-71= 35 million shares.

A lot of assumptions in this example and it may still backfire for Novus et al.

Agree with Palermo putting his money where his mouth is. He actually "commended" the cr to shareholders in the prospectus which is at least more encouraging than the prospectuses of other companies.