Dear Opt--In Subscriber,
We write this update, the sixth of 2013 as a continuance of our efforts to keep our shareholders and other interested opt--in subscribers up to date on management’s efforts to seek funding solutions and reinstate trading in the Company’s shares.
In our previous letters we advised that the secured lender had instructed the National Bank of Costa Rica to auction the shares of Veritas Gold, Ascot’s wholly owned subsidiary. Our lawyers continue disputing certain irregularities in the auction process such as incorrect procedural protocol and omissions of facts. Ascot’s lawyers have confirmed there are proper grounds for disputing the process.
As mentioned previously, Veritas Gold SA owes Ascot approximately £7.4 Million in inter--company loans, which debt is subordinated to the secured lender, therefore, it is imperative this fact be disclosed to any party contemplating the acquisition of the shares at auction.
We are pleased to advise that the UAE based Gold Fund has advanced the majority of the first tranche of funds necessary to restart operations and production of gold. These funds have already been deployed and operations have re--commenced. Mining is underway and the mill is operational. See brief video clip:
http://www.youtube.com/watch?v=stUSmw059hUThe Company is on track to deliver an initial 390 ounces of gold after which, a second tranche of US$4 Million of the agreed US$10Million facility will be released. This is expected to occur within the next 60+/-- days. These funds will be utilized to pay out the secured creditor, provide expansion funding, clear up other Ascot payables and provide working capital. The third tranche of US$5.5Million will be available for drawdown as and when required.
Ascot is preparing for reinstatement of trading in the UK and in Germany. Ahead of accessing the second tranche of funds the Company is seeking up to US$1.5 Million (£1Million) through equity placing/s. The Company is in talks with a number of potential investors who are recognizing the unique opportunity to participate in Ascot’s re--emergence to the market. Immediate supplementary equity funding will ensure a strong working capital position and a timely re--start of trading. Current market conditions are presenting compelling opportunities for those companies with financial capabilities. Ascot is determined to obtain steady state production of gold and capitalize its treasury, thus positioning itself to expand gold production in Costa Rica and through a targeted acquisition policy. The foregoing is consistent with Ascot’s originally stated business model. Management is pleased to have partnered with the fund, which will facilitate the availability of capital in order to execute this plan.
Our team continues working tirelessly toward meeting the challenges facing our company and moving forward to realize successful steady state production from our Costa Rica operations and seizing opportunities presented in today’s market.