General Chat, page-2773

With hindsight I am not that surprised the cap raise occurred, given NVA were around 10 months from the last cap raise, just days from the end of quarter ( so they would have been reviewing their numbers ) and posters appearing speculating NVA would cap raise.

A few thoughts on this raise:

1. I'm pleased there are no options (reduces dilution)
2. I'm pleased there will be no SPP (SPPs and rights issues drag out and for this reason I loathe them - they take about 4 weeks and just result in holders selling to take advantage of the SPP, usually to take up free options when they become available in a SPP )
3. It won't be the last. Pre-production miners need capital from the market to fund exploration and development studies.

I've seen more and more companies starting to use loyalty option issues to existing shareholders as a means of offsetting the dilution of a capital raise. They are better than SPPs and rights issues and they are less likely to put a handbrake on the share price.

A loyalty option issue of 1 x loyalty option for every 10 shares held with a strike price of 22c would mean issuing 168M options. Assuming 3 year expiry ... that would mean $36.9M of funds into the kitty in 3 years time ... right when they need to finance the mine. Would go a long way to funding the equity component needed along side debt funding for the mine.

A bit of forethought and planning and they could have had a much better outcome for all shareholders.

• Existing shareholders would be less annoyed
• Fewer holders dumping shares in anger
• Share price rising after the cap raise rather than falling (people adding to their holdings to increase their loyalty option allotment).
• Less chance that participants in the cap raise might sell stock short-term (due to the loyalty options and noting NVA newsflow expected to increase)

Would be great if NVA management could consider this approach in the future (would be better for them anyway - reduces their own dilution).

As another scenario management could consider a loyalty option issue down the track. In a hypothetical scenario of a loyalty option issue at $0.30 and even a 50% premium the strike price would be $0.45. $0.45 at 1 for 10 rate would be around 180M options - that would bring in $81M after say a 3 year expiry.