Keep Digging,

Agreed that 10.8% OS is a precarious level, but at least it's over 10% and w/o the 4M wts (which represents 0.6%). With the wts: 10.8% +0.6% = 11.4% which is a bit better, but still precarious.

Here are a complete list for the updated structure (KWG website)

- OS: 671.5M

- Wts: 153 M

- Opts: 65M

- FD: 890M

and from the last voting results

- Management: 17.9M w/o wts and opts (or = 2.66%)

- CLF: 111.8 M (= 16.65%OS)

Note:

1. KSU + Management = 10.8% +2.66% = 13.46% (still not quite match CLF's). We need some institutional group that have a block of about 3.2% to be even with CLF holding. Know of any major group that could be considered as friendly?

2. With the wts and opts included management holding could grow to 17.9 + 65 opts = 82.9M (12.34%OS, should have used % FD but this is only for qualitative discussion purposes only). As I understand it, the exercise prices are in the range of $0.10, hence there would be a good chance for all of them to be exercised. Management also holds a large chunk of wts, but I don't know exacltly how large a chunk. Anyone knows?

It would appear that management with the exercise of opts is holding some good cards. With KSU block of approximately 11.4% the combined strength = 11.4 + 12.34 = 23.74% (only opts included) which is quite respectable, but still below the 1/3 level (67.1M shares more is required to get over the 1/3 level). In other words, we would need to have over half of the outstanding wts (153 M wts) to reach the 1/3 level. Given the SP at $0.06, the wts must be dirt cheap. Just don't let CLF (or her friends) scoop them all up.

Do your own DD and have fun with the math.

goldhunter