Ann: $49.3 Million Placement Agreement, page-53

You make some excellent points Battersea, and very pertinent.

I've seen this many times before over the past 30 years. The capital raising from Chifeng is not an actual capital raising, it's actually more of a positioning for an eventual takeover, it couldn't be clearer.

That presents us long term holders with a problem, and there is a dozen different ways it could play out, but unfortunately, most of them involve us receiving less for our shareholdings than we should.

What we should be concerned with however, is the main problem - as I've said, I've seen this many times before. And that is, the DISCONNECT between the reward offered to the MD/CEO and Company Directors, COMPARED to that offered to the Shareholders via a Takeover Bid.

You see, when Shandong (same current president as Chifeng) took over Cardinal Resources in Ghana, the MD/CEO and Company Directors of Cardinal received in compensation four ( 4) times the value of their shares in Cardinal (courtesy of my Canaccord broker in Toronto, Canada), whereas the Shareholders received ONLY the takeover price - in other words, four (4) times less.

We are not complaining though, in fact, we are not really allowed to complain, many of us received a 200% profit at the takeover price anyway. But you can therefore calculate what the MD/CEO and Company Directors of Cardinal received from Shandong.

The basic issue is always the same - the MD/CEO and Company Directors do everything they do, for THEIR OWN Profit, NOT Yours or Mine. Let's face it, if they can go to a Chinese company and get $100 million dollars, then they don't give a damn about your little five thousand investment, in fact it's more of a hindrance to them than anything else. I'm just being realistic here, although it may not be pretty.

What can I say, it all comes down to basic human nature.

Really, you need to get into this stock under 50 cents, because the eventual Chifeng takeover is going to cap the price for Shareholder rewards, but NOT for the MD and company director rewards.

This is just the way the system is "allowed" to work.

They'll probably tell you in the end, that you should be thankful for the morsels that you are thrown - and maybe they are right, maybe we should be thankful, because after all, we're not doing anything except transferring money.

Reality can be harsh, but sobering.

Gw