East Asia Minerals Concerned Shareholders' Highlight the Complete Depletion of the Company’s Treasury by the Current Board
Vancouver, British Columbia (FSCwire) - Vishal Gupta and Patrick Cronin, as concerned shareholders (the "Concerned Shareholders") of East Asia Minerals Corp. (the "Company") have issued a proxy circular dated January 12, 2018 (the "Circular"), and a supplement to the Circular dated January 23, 2018 (the "Supplement" and together with the Circular, the "Concerned Shareholders' Materials") urging you to create positive change for the Company by voting for Vishal Gupta, Kim Oishi, Michael Hawkins, and Rick Huang (the "Concerned Shareholders' Nominees") at the upcoming annual meeting of shareholders of the Company to be held on February 1, 2018. The Concerned Shareholders’ Materials can be found on www.sedar.com.
The Concerned Shareholders urge you to vote the GREEN or BLUE form of proxy or voting instruction form as soon as possible, and by no later than 10 A.M. on January 30, 2018.
The Concerned Shareholders would like to highlight the depletion of the Company’s treasury and working capital under the stewardship of the current board of directors (the “Board”). The Company raised $4.2 million through two separate financings in March and May 2017, respectively. The Company’s annual audited financial statements for the year ending August 31, 2017 show the DEPLETION OF THE WORKING CAPITAL TO ONLY $799,575 (Current Assets: $1,742,193; Current Liabilities: $942,618).
Based on the Company’s General & Administrative expenditure over the last six months, the Concerned Shareholders estimate the Company’s current cash “Burn Rate” to be in the $150,000 per month range, at the very least. Based on that estimate, by January 31, 2018 the Company would have burned through an additional $750,000, leaving the treasury EXTREMELY LOW AT UNDER $50,000 IN CASH, less than one year after raising $4.2 million.
In addition, Mr. Terry Filbert admitted to the British Columbia Supreme Court on January 25, 2018 that the Board has spent $228,000 on proxy solicitation efforts associated with the current dissident action brought to the Company by the Concerned Shareholders, further depleting the treasury and effectively rendering the Company INSOLVENT.
It is abundantly clear to the Concerned Shareholders that the Company’s current Board is interested in one thing, and one thing only – and that is preserving their positions at any and all costs. THIS IS SHAREHOLDERS’ CAPITAL – NOT THE CURRENT DIRECTORS’.
The Concerned Shareholders also note that of the $4.2 million raised by the Company through the March and May 2017 financings, the Board can take credit for sourcing roughly $1.0 million only. The remaining $3.2 million was sourced by Mr. Kim Oishi, who was working for the Company as a director and a consultant at the time. Mr. Oishi resigned from the Board on June 14th 2017, and it should come as no surprise to anyone that since his resignation, the Company’s share price has fallen from $0.50/share on June 14th to the current price of $0.08/share. Mr. Oishi is one of the four Concerned Shareholders’ Nominees.
Terry Filbert and the Board have disclosed that their priority is to put the Sangihe gold-copper project into production, which has an existing National Instrument 43-101 inferred mineral resource of 114,700 indicated ounces and 105,000 inferred ounces of gold. They have depleted the Company’s treasury with management fees, consulting fees, a feasibility study and an environmental study focused on a tiny deposit with no financial plan to fund the capital expenditure. The Concerned Shareholders estimate that an equity raise at the current share price to fund production at Sangihe would require issuing 50,000,000 shares or more, effectively diluting current shareholders’ interest by 50% in Miwah.
Terry Filbert and the Board have not disclosed an exploration plan or budget to add to the resource on Sangihe or to identify other opportunities for the Company.
The Concerned Shareholders also highlight that Terry Filbert and the Board do not appear to have allocated significant resources or attention to resolving the legal and regulatory issues regarding the Miwah property with an existing National Instrument 43-101-compliant inferred resource of 3.14 million ounces of gold and 8.95 million ounces of silver.
Time for you to make a positive change at East Asia Minerals
The Concerned Shareholders' Materials contain a detailed description of the Concerned Shareholders' concerns about the current management of the Company and the incumbent directors, as well as the plans that the Concerned Shareholders' Nominees have to move the Company forward.
The Concerned Shareholders urge you to vote FOR the Concerned Shareholders' Nominees using either the BLUE form of proxy or voting instruction form mailed with the Circular OR the GREEN form of proxy or voting instruction form filed online at www.sedar.com under the Company's profile. PLEASE VOTE YOUR GREEN OR BLUE PROXY or VOTING INSTRUCTION FORM BEFORE JANUARY 30, 2018 at 10:00 A.M. PST.
For assistance with obtaining the "control number" required to vote your Shares using a voting instruction form, Non-Registered Shareholders should contact their broker or other intermediary or, in the case of non-objecting beneficial shareholders, Broadridge Financial Solutions, Inc. at ProxyRequest.ca@broadridge.com.
Yours truly,
Concerned Shareholders
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If you would like more information about the above news release, please contact Vishal Gupta at vgupta@caligold.ca or +1-647-466-0506.
To view the associated document to this release, please click on the following link:
public://news_release_pdf/EastAsia01282018.pdf
To view the original release, please click here
Source: East Asia Minerals Corp. (TSX Venture:EAS)
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