To all:
The following letter from Jensen will be mailed out to all shareholders today and tomorrow:
June 2 , 1998
Dear Shareholder,
The company1s shares have been under pressure for some time now and we have substantial evidence and reasons to believe that there is an ongoing effort by a yet unnamed group to debase the share price and thereby force a reorganization of the company. By discouraging existing shareholders this group hopes to be able to organize a shareholder rebellion against current management and thereby take control of the company. Should they succeed you may be assured that they will institute a reorganization of the share structure (reverse split). The reverse split would leave current shareholders with a fraction of current shares and little voice in company affairs as the take-over group issues more shares to themselves.
I assure you this effort will not succeed for two reasons. First, the group cannot gain enough shareholder votes to overthrow current management. Large share positions are held by long term investors who have complete confidence in the future of our company. Their shares, plus the shares held by management, plus the shares of the loyal smaller shareholders who understand the potential of GPGI will successfully resist any effort at stealing our company.
But secondly, and of greater relevance, their attempt will soon be swamped by developments in GPGI which will negate all their efforts at running down the share price.
At the Hassayampa mill we are presently processing ore with a new, much more efficient method than the production of anode sludge through electrowinning.
The last shipment of anode sludge (35 pounds) was made to Sabin Metallurgical three weeks ago and we will soon be receiving a settlement report for this shipment.
Future shipments will be processed with our new method.
This new method is based on the use of resins. We still use our proprietary material when we leach our head ore to produce a primary precipitate. This precipitate is smelted using copper as the collector. The copper metal containing the precious metals is then dissolved in a dilute combination of acids and processed through a newly developed ion exchange resin. This takes takes out the platinum, gold and palladium and lets the copper flow through. Then the solution is transferred to another ion exchange resin column containing a new resin and that takes the rhodium out. The pregnant resin can be sold as is or it can be further processed by GPGI and sold as a precious metal mixture of powders to refiners like Johnson/Mathey or Engelhard. Alternatively, GPGI could develop an in-house procedure which would put the metal at 800-900 fine purity and sell it to an outside refiner to further refine to 999 purity.
Elimination of electrowinning speeds up the process significantly, reduces cost and the resulting product is much easier for outside refiners to further refine.
The economics of this development for GPGI are phenomenal. We are now able to process 5 tons of head ore per day ( and incidentally we will soon be able to provide an input-output result of head ore processing so that we know fairly accurately what the value of the head ore is and by extrapolation what our ore pile is worth). The 5 tons will be advanced to 10 tons per day as soon as we can expand our filter capacity. Sometime over this summer we should be in a continuous production mode which will generate sufficient income to eliminate the need for GPGI to raise money for ongoing operations.
From there forward, expansion of the production rate is only a matter of expansion of the infrastructure.
In addition to this break through, we are in communication with more than one major funding source. While nothing is certain till the check is in the bank and cashed, with the advances being made on fundamentals, we believe that sooner or later, and probably sooner, some smart, major money is going to jump on us with a joint venture proposal we cannot refuse. Think about it. With a continuous flow of ore being processed and sold, with an artificially depressed share price producing a seriously undervalued company with vast potential, is this company not going to be wooed by major players?
I want to express my profound appreciation to shareholders who have had their patience tested beyond all reasonable expectations. You will be soon rewarded. But let me remind you that the extraction problem for the desert sands has been a thorny nut which no company, of the many involved, has been able to crack. We are the only ones to do so.
We have, in essence, invented the wheel. And you can bet that the wheel was developed not in one lightening stroke of imagination but over many decades. When Bob and Bill were carrying boulders on their shoulders hundreds of thousands of years ago, Bob said to Bill 3lets put these rocks on that log and roll the log. We could call that a wheel. Isn1t that a great idea? Bill answered: 3That1s a stupid idea. If it was such a great idea they would have discovered it years ago.ý
Best regards,
Richard Jensen
President
Global Platinum + Gold Inc.
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