conversion or default, page-16

Hi Ozapp,

Just a little bit of info regarding last year.

The original plan of the company which was announced in August last year was to get shareholders to vote on the Octaganol loan for $2.1m @ a conversion price of .44cents with a 20% discount making it .35 cents and a 5 for 2 rights issue @.4 cents to raise $10m

By offering the 5 for 2 rights issue the company was assured of getting a YES vote as shareholders with large holdings, spare cash and possibly more information than ordinary shareholders could have acquired so many cheap shares.

Shareholders objected see Hotcopper and the follow up announcement never occurred.

The Board then needed another plan and on 31st October we were informed that we were to vote on the 5 for 2 rights issue and secured con. notes up to a value of $7.2m which is 2 billion shares. This made the 5 for 2 very unattractive to all shareholders as the secured notes were cheaper @.35cents and secured.

IMHO This company has a proven record of being able to ignore debts even after warnings from the auditor and the ASX and spend excessively, knowing that the consequences suit their objectives.

So IMHO why bother with a vote and an AGM when you can go straight to DEFAULT and take over the company