Ascot Resources plans rights offering, 1:50 rollback

Executive Summary

• Ascot Resources Ltd. has entered into an advisory agreement with Fiore Management and Advisory Corp. to assist with restructuring, refinancing, and leadership enhancement, with the goal of restarting production at the Premier gold project.
• The company is launching a non-brokered rights offering to raise approximately $14.9 million CAD, fully backstopped by Fiore, priced at C$0.01 per share, followed by a 1:50 share consolidation.
• The restructuring includes advanced negotiations for an $18 million USD bridge financing with Nebari Gold Fund and amendments to existing indebtedness and streaming agreements with Sprott Private Resource Streaming and Royalty (B) Corp.

Key Details

• Advisory Agreement: Ascot entered into an advisory services agreement with Fiore Management and Advisory Corp. to assist with restructuring, refinancing, and enhancing the leadership team, focusing on the Red Mountain deposit and restarting the Premier gold project.
• Rights Offering:
  • Structure: Non-brokered offering of rights to eligible registered shareholders.
  • Ratio: One right for every common share held as of the record date.
  • Exercise Price: C$0.01 per new common share.
  • Gross Proceeds: Approximately $14.9 million CAD.
  • Backstop: Fully backstopped by Fiore.
• Share Consolidation: A 1:50 share consolidation will occur subsequent to the closing of the rights offering.
• Future Equity Financing: Fiore agreed to use best efforts to facilitate an equity financing of $150 million CAD, priced in the context of the market and considering the rights offering.
• Bridge Financing:
  • Counterparty: Nebari Gold Fund 1 LP, Nebari Natural Resources Credit Fund II LP, and Nebari Collateral Agent LLC.
  • Amount: Up to $18 million USD, available in multiple drawdowns.
  • Terms: Subject to conditions precedent; Nebari receives common share purchase warrants with an exercise price equal to the share price of the private placement.
  • Timeline: Anticipated to be in place by the end of the month.
• Lien Settlement: Proceeds from the rights offering will be used to settle certain existing lien claims related to the Premier gold mine.
• Debt Restructuring: Ascot is negotiating to restructure existing indebtedness with Nebari and amend existing secured streams with Sprott Private Resource Streaming and Royalty (B) Corp. and/or its affiliates.
• Management: Fiore committed to assisting with enhancing the management team to advance the Red Mountain deposit and restart the Premier gold project.
• Regulatory Approval: The restructuring is subject to approval by the TSX Venture Exchange and certain shareholder approval requirements.
• Project Status:
  • The Premier gold mine and Red Mountain have been on care and maintenance since June 25, 2025.
  • Post-reorganization, the project is expected to remain in care and maintenance for a period of time.
  • Since construction commenced in mid-2021, approximately $538 million CAD in construction and development costs have been incurred.
  • Infrastructure completed: Premier mill refurbished and commissioned at 2,500 tonnes per day (tpd); 6,300 meters of development driven in Premier Northern Lights and Big Missouri deposits; new water treatment plant operating since February 2024; 128-bed camp built.
  • Future plans: New management will conduct studies to determine the best path to commercial production.
• Advisers:
  • Financial Adviser to Ascot: Desjardins Capital Markets.
  • Financial Adviser to Special Committee: Maxit Capital LP.
  • Legal Counsel: Blake, Cassels & Graydon LLP.
  • Maxit Capital provided an opinion that the restructuring is fair, from a financial point of view, to the company.

Notable Quotes

• "Today's announcement marks a turning point for the company following an undeniably difficult period for Ascot. By partnering with a credible group such as Fiore, we are taking definitive action to create a stable capital structure to enable the advancement of Red Mountain and sustainably restart the project," said Andree St-Germain, chair of the special committee of Ascot.
• "We recognize this restructuring is a difficult next step for shareholders, but it is both timely and necessary considering the company's challenging financial situation. Since we initiated our strategic review, Ascot and its financial advisers have rigorously explored alternatives, including a sale of the company, mergers, asset sales, alternative financing sources and even the potential for protection under the Companies' Creditors Arrangement Act (CCAA). In this context, Fiore's proposal offered the most preferable outcome for all stakeholders," added Ms. St-Germain.