Le Penseur

SVP pass along my congratulations for a fine piece to your evil twin, comprehensive work as usual!

Your post say:

"I agree and have a great deal of faith in the KWG team, their strategic "know how" and their true objective of bringing maximum value to all shareholders...including themselves...why not...they did all the work!!"

I would fully support your conclusion above. Would like to add some comments on dilution and potential gain (for everybody, including management): Dilution is a legitimate concern for shareholders when they see some potential 100M shares, as an example, added to the current OS of 750M shares. This represent a 11.7% dilution, but we should not forget that, at the same time, the value of the company is enhanced by the future potential value of the IP on the gas conversion process. This value has not been currently recognized by the market, which is subject to SP manipulation by many entities with ulterior motives.

As I see it, the real objective for management would be to increase the value of the company many-fold (for all shareholders, including themselves...I don't have problem with that, as long as I have x2, x3, x4, etc...of my investment).

Take the rock-bottom price of ~$0.30, the xfactor would be 0.30/0.07 = 4.3 (say 4) This valuation was done a few years ago when KWG did not have BH, the RR corridor, and now the IP option agreement for a process which may be worth a huge sum of money.

Management is trying (my belief) to have some control over the voting power. They have learned from their experience the last time when their proposal was voted down by CLF (with ~16%, but effectively CLF had 32% plus a few more votes from friends for over 1/3 to defeat the resolution, due to a low vote turn-out...some 50%?). There are a lot of options and wts floating around, in addition to some recent number that we saw. It may take a few millions to convert them to shares. But a few million dollars are chump change compared to what Frank is going after. If he can get ~$1.0/s offer from a biggy (e.g. Glencore, etc) with deep pocket then I would be prepared to entertain the idea of letting go my share and go to some warm place (Cayman Islands?) for a few months each year.

My crystal ball says low-ball offer would start at $0.40/s, and a more serious and short bidding war will follow, with a victor that we probably know well (not like the saga where Gold Corp trying to get OSK cheap, and lost to YRI/AEM a few days ago...lesson learned here: be snappy, reasonable, i.e. not trying to be too cheap, and negotiate in good faith).

Cheers and good luck to all KWG longs,

goldhunter