Indirect PP...some rouph calculations

HIGH-GRADE NI-CU-PT-PD-ZN-CR-AU-V-TI DISCOVERIES IN THE "RING OF FIRE"

NI 43-101 Update (September 2012): 11.1 Mt @ 1.68% Ni, 0.87% Cu, 0.89 gpt Pt and 3.09 gpt Pd and 0.18 gpt Au (Proven & Probable Reserves) / 8.9 Mt @ 1.10% Ni, 1.14% Cu, 1.16 gpt Pt and 3.49 gpt Pd and 0.30 gpt Au (Inferred Resource)

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From_Sudbury

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Indirect PP...some rouph calculations

posted on Dec 12, 2009 09:47AM

FWR has 252,106,467 fully diluted shares

If NOT gets say exactly 12.5% FWR shares, that works out to 31,502,058 FWR shares

For this, they would have given up 9,000,588 NOT shares (3.5 to 1)

At Friday's closing price, the cost to NOT at $2.09/share works out to a cost of $18,811,228

Now, if they are able to sell all those FWR shares for $1.00, they get $31,502,058

Divide this by the number of NOT shares they gave up to aquire the FWR shares and we get $3.50 per NOT share

In the end, this would be equivalent to doing a PP at $3.50 per NOT share with a warrant to buy 1 NOT share for $4.00 anytime in the next 5 years. Not bad when your shares are trading for only $2.09.

This is assuming of course that they were successful in gaining 12.5% of FWR shares and that it is legal for them to sell the newly aquired shares to Cliffs.

It's not likely they could have convinced institutions to go along with such a PP; but they may have convinced retail to do so. (I say convinced....others may use stronger language)