If the current PP is fully subscribed at $10m, then the resulting number of new shares will be 181.8m. In addition, 121.2 warrants will be issued. The total fully-diluted increase in the float will therefore be 303.0m.

The current number of shares outstanding (FD) is 952.4m.

The new float after the PP would therefore be 1,255.4m.

The percentage of the company that this new PP represents is therefore 24.14% of the company. I had a theory, but it rested upon that number being slightly under 20% of the company. However, if the PP was already fully subscribed in theory, to just two entities, and one took about 20% of the PP or 5% of the company, then the other entity could in one swoop gain just slightly under 20%. There are certain Insider rules that fall into place when an entity acquires 10% of a company, and more than fall into place when an entity acquires 20% of a company.

On a separate note, Frank has been interested several times in creating a supershare, ostensibly so certain entities that are restricted from investing in penny stocks could take a position in the company. As many here know, there was a lack of trust in the concept, even though it appeared that retail support was in favour of the move on the last go-around.

I'm not sure why Frank didn't just try a different approach. Here's how:

- Start a new corporation. We'll call it BBB. Better Bang for your Buck Canada Corporation.

- BBB issues a million shares of stock at a par value of $10. These shares are not publicly traded (at least not at the start). They are held, and then an interested investor is lined up to take the whole lot, buying a million shares at $10 each for $10m.

- BBB company now has a single shareholder at 100%. Obviously, due to insider rules, that investor becomes an Insider to the company, even though BBB's board might consist of Frank and a couple other lawyers.

- BBB company has $10m sitting in the bank. They don't have any operations, don't produce any goods or services, but they're ready to invest. Kind of like Mick Davis, but with no intent to go into mining or anything else.

- KWG sets up it's PP so that BBB buys the entire PP. Fully subscribed, including the over-allotment. BBB now owns 181.8m shares of KWG, and 121.2m warrants.

- But Unknown Entity actually owns 100% of BBB, so they are affected when KWG's SP goes up or down. Yet Unknown Entity owns shares in a company that has a SP of approximately $10 per share, rather than being a penny stock.

I'm sure there are rules that attempt to prohibit this sort of circumvention of rules. However, I'm also sure that there are ways around such rules. If BBB is not publicly traded, then the Exchange has no interest in the matter. As long as Canadian accounting rules and laws are followed, then it's all legitimate that way, and the government wouldn't care. The only concern that could be raised would perhaps be by members of the hedge fund or whatever the Unknown Entity is, for the act of following their Charter rules in letter but not in spirit. But I suspect that if persons were to be presented with a significant gain in the value of their asset (holdings of BBB) then that would quickly silence any objections that might be raised. Admittedly though, this could be a weak point for my idea, because the Hedge Fund's relationship with investors is a legal contract and it would have to be careful.

There's more than one way to skin a cat.