Virgin Gold Convertible Preferred Shares – Platinum (CPS-PLATINUM)
April 26th, 2012
Dear Shareholders:
Hold on to your hats!
Virgin Gold Mining Corporation will be offering CPS-PLATINUM to all qualified shareholders effective the 1st of May 2012.
I need to address a few important points with regard to CPS-PLATINUM.
1. The need for funds. Due to the fact that Platinum mining is a new project for the company, the requirement for funds is not like our gold mining project. Therefore, management has decided to offer this investment opportunity to selected shareholders and set a limit to their subscription. Furthermore, the need for funds will be strictly controlled in the sense that management will decide to approve only X% (not all) of subscriptions every week, in accordance with the amount of funds needed for the project. Management wants to avoid holding extra cash that it does not need and bear the burden of paying dividends of the subscribed shares. In this way, management will be able to offer CPS-PLATINUM investments to its shareholders at an even higher return compared to CPS-GOLD.
2. Risk. It is wrong to consider that investment in CPS-PLATINUM represents a higher/lower risk compared to CPS-GOLD. For CPS-GOLD, the company uses the funds to invest in gold income generating activities, thus paying dividends in troy ounces of gold. For CPS-PLATINUM, the company uses the funds to invest in platinum mining activities, thus paying dividends in troy ounces of platinum. Theoretically speaking, if the CPS-PLATINUM investment goes bad, it does not affect the CPS-GOLD investment and vice-versa as we have created different special purpose vehicles for both sets of investments.
3. Many parameters such as limits and eligibility status may be adjustable from time to time and I urge shareholders to follow our news releases closely.
Below are the fine points of the CPS-PLATINUM offering:
Offer Price:
USD1.00 a share
Eligibility:
1. A shareholder of Virgin Gold for a minimum of 1 year
2. VG Premier Shareholder
Subscription Limit:
The current limit is set at a ratio of every two CPS-GOLD to one CPS-PLATINUM. For example if a shareholder owns 100,000 CPS-Gold, he/she is only eligible to apply for a maximum of 50,000 CPS-PLATINUM.
Minimum Application:
100 CPS-PLATINUM
Application Procedure:
1. Go to 1.31 in your shareholder’s account to apply.
2. A credit amount equivalent to your application must be available in your credit account. For example: If you apply for 20,000 CPS-PLATINUM at USD1.50 per share; you need 20,000 x 1.50 = 30,000 credits to apply.
3. Credit amount equivalent to your application will be deducted from your credit account.
4. Application is only open on Saturdays.
5. The acceptance of the application is not a guarantee of approval/subscription to CPS-PLATINUM.
Approval Procedure:
1. Approval of CPS-PLATINUM applications will be released every Monday or Tuesday of the following week. For example: If you apply on Saturday, the next day would be Sunday and then Monday and followed by Tuesday. Approval for all applications will be released either on Monday or Tuesday.
2. Management expects to receive many applications for CPS-PLATINUM from shareholders every week. Therefore it’s highly possible that only a certain amount of your application will be approved. For example: If you apply for 50,000 CPS-PLATINUM, you may only be allocated 40,000 CPS-PLATINUM that week. You may try to apply for the balance of 10,000 CPS-PLATINUM the following week.
3. Un-used credits will be automatically returned to your credit account together with the approval allotment.
Dividend:
Dividend is payable every 30 calendar days in troy ounces of platinum. The 1st day of calculation is the approval date, not the application date. Shareholders will know the contractual dividend payout when they apply for CPS-PLATINUM under “1.31 Subscribe CPS” in their shareholder account. Dividend in platinum is freely convertible to credits and vice versa.
Un-subscription:
Un-subscription of CPS-PLATINUM is only allowed after 60-days from the day of approval. The un-subscription price will be at the current month set price for CPS-PLATINUM, not at the purchased price.
Share Transfer:
CPS-PLATINUM is not freely transferable among shareholders, unlike CPS-GOLD.
Group and Referral Incentive:
There is no referral incentive paid for CPS-PLATINUM subscriptions. The good news is that the CPS-PLATINUM and CPS-GOLD monthly subscription volume will be merged for group bonus calculation.
Trading Account:
There is no spot platinum trading unlike gold.
Premier Status:
CPS-PLATINUM will not be included for calculation of Premier Status.
Listing:
Similar to CPS-GOLD, we plan for listing of this investment vehicle (CPS-PLATINUM) sometime in the future.
Conclusion:
The launch of CPS-PLATINUM is an amazing landmark for Virgin Gold.
I hope shareholders do not view CPS-PLATINUM as another opportunity to invest in another investment with a higher ROI relative to CPS-GOLD. It would be unfortunate for you to look at it this way.
I hope you see this as a decent effort by the company to offer you the chance to diversify your investment in another asset class, platinum. Platinum is less subject to speculation and price fluctuation. Platinum is a precious metal that is used and not kept. Historically, platinum price is usually higher than gold but recent events may suggest otherwise.
For management, this is an opportunity for the company and its shareholders to explore another financial product. Fingers crossed that CPS-PLATINUM will be even more successful than CPS-GOLD.
Thank you.
Kenneth Elinger
President
Virgin Gold Mining Corporation
