calculations, page-6

"Bouz...you are forgetting to add in the cash that is being tipped in...need to add this to the post raising mkt value"

Thanks PViews,

You've helped me to calculate more accurately the adjustment in price.

Number of Shares before issue = 1.6 bn

Placement of 1 for 4 shares

Number of Shares after issue = 1.6 bn plus 400M = 2 bn shares

Market Cap < issue: 1.6 bn shares * 16 cents = $256 M

Market Cap > issue: $256 M + (400M * 10cents) / 2 bn shares = $296 M / 2 bn shares = 15 cents opening price.

In VPG's situation, in the annual report it was indicated that a placement to McCabe may occur at 10 cents. Despite this, the recent trading saw the SP go recently more than 50 % above 10 cents.

Hence, this 1 for 4 at 10 cents will by no means in my view send the price down to 10 cents in trading. If anything, it will open around 15 cents, and because the McCabe situation is behind us and the balance sheet stronger by 16 % ($40M / $256 M) then the price will not fall strongly because of fundamentals.

If it does fall stronly, it may be because of perceptions such as downward pressure to influence people to sell so others get in cheaper, etc. Personally i am happy with the position the company is in.

Regards,

Bouzouki