Stock Shark,

I believe you are wrong and here is why.

“Management presently believes it can maintain Omagine’s majority control of LLC while successfully selling a further minority percentage of LLC’s equity to new non-U.S. investors in the MENA Region for an amount in excess of the average cash investment amount paid by the New Shareholders.”

The following is my interpretation of the above, someone please correct me if I am wrong. Management wants to sell a portion of LLC, not Inc. so there would be no more shares issued, so no more float.

As for the price, Inc. would be selling less than 10% of their 60% stake in LLC. So, Inc’s stake in LLC could go from 60% to 50% (worst case). That would affect Alton’s book value by reducing it from $28.26 to around $23.55. However, that doesn’t include the cash Inc. would receive for that share (between 5m and 20m to fund the first phase). Nor does it include the interest LLC would presumably pay Inc. for the loan of that cash amount. So, the effect on Inc.’s book value would be much less than the above.

Not to mention the purpose of selling this piece of LLC is to accelerate the financing date which increases the probability of project success for the reasons detailed in the 10-Q.

All that said, there are a few possible reasons for dilution but none of these were mentioned in the excerpts from the 10Q and cash raised from any of these would decrease the amount of LLC that would need to be sold:

1. Shareholder $5 and $10 warrants.

2. Tempest warrants.

3. YA Global SEDA.