Comstock Mining Inc. (“Comstock” or “the Company”) (NYSE American:
LODE) today announced significant progress toward the completion of
the sale of its Lucerne properties (“Lucerne”).
The Company understands that Tonogold Resources, Inc.
(“Tonogold”) has secured significant interest for funding the
Lucerne purchase and is finalizing negotiations of optimal terms
and allocations. Tonogold also recently executed a Term Sheet with
Nebari Holdings, LLC (“Nebari”) for a $5 million, debt financing
with the option for drawing an additional $25 million for
development, production start-up and working capital, subject to
customary due diligence and closing conditions. Nebari is
Comstock’s current lender. Mr. Mark Ashley, President and CEO of
Tonogold stated, “Our diligence is paying off with the assembly of
an outstanding group of strategic resource investors who understand
the significance of the gold and silver resource at Lucerne and the
greater exploration potential of the whole northern portion of the
Comstock District. We look forward to accelerating and
consummating the transaction announced with Comstock in January
2019, in the next few months.”
Tonogold has also committed and partially funded another $1
million in non-refundable deposits. For the year-to-date, Comstock
has received $2,350,000 in cash as non-refundable payments,
including $350,000 recently, toward the aggregate purchase
price, with an additional $450,000 and $200,000 due on or prior to
May 17, and May 24, 2019, respectively. These payments extend the
deadline for closing the transaction to June 21, 2019.
Comstock has received $350,000 and will use seventy-percent of the
entire $1 million in payments to pay down its outstanding
debenture, bringing the outstanding principal down to approximately
$6.7 million. Accordingly, both parties have reached an
agreement to provide additional extension opportunities for closing
on Lucerne, primarily to allow for a more thorough and efficient
financing and closing process. Comstock agreed to provide Tonogold
with the flexibility to close on Lucerne on or prior to August 30,
2019, subject to making additional $1 million monthly
non-refundable deposits in late June 2019 and late July 2019, if
needed. If the closing occurs after the original deadline of May
31, 2019, Tonogold will also reimburse Comstock for all incremental
interest costs and substantially all property carrying costs, as
previously agreed. Comstock now anticipates, and the
amendment allows for, Tonogold to deliver $11.5 million in cash at
closing, less the amounts of the cumulative non-refundable payments
made by Tonogold at that time, and a one-year maturing, interest
bearing note converting into shares in Tonogold if not repaid
previously, to Comstock with a principal amount of $3,500,000. The
conversion price will be the lowest of (1) the 20-day volume
weighted closing price of Tonogold shares prior to conversion, (2)
Tonogold’s most recent private placement or (3) Tonogold’s initial
public offering price. Mr. Corrado De Gasperis, Executive Chairman
and CEO, stated, “Tonogold has made consistent progress toward
acquiring the Lucerne mine and has worked effectively to secure
sufficient strategic investment capital for closing this
transaction and funding Lucerne development. The effort and
results are both outstanding and we look forward to closing the
Lucerne transaction in the next few months.” About Comstock
Mining Inc.
Comstock Mining Inc. is a Nevada-based, gold and silver mining
company with extensive, contiguous property in the Comstock
District and is an emerging leader in sustainable, responsible
mining. The Company began acquiring properties in the Comstock
District in 2003. Since then, the Company has consolidated a
significant portion of the Comstock District, amassed the single
largest known repository of historical and current geological data
on the Comstock region, secured permits, built an infrastructure
and completed its first phase of production. The Company continues
evaluating and acquiring properties inside and outside the district
expanding its footprint and exploring all of our existing and
prospective opportunities for further exploration, development and
mining. The near-term goal of our business plan is to maximize
intrinsic stockholder value realized, per share, by continuing to
acquire mineralized and potentially mineralized properties,
exploring, developing and validating qualified resources and
reserves (proven and probable) that enable the commercial
development of our operations through extended, long-lived mine
plans that are economically feasible and socially responsible.
Forward-Looking Statements
This press release and any related calls or discussions may
include forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 about Comstock and
Tonogold. Forward-looking statements are statements that are not
historical facts. All statements, other than statements of
historical facts, are forward-looking statements. Forward-looking
statements include statements about matters such as: capital
raising activities and negotiations; market conditions; future
changes in exploration activities, production capacity and
operations; future exploration, production, operating and overhead
costs; production of feasibility studies, technical reports or
other findings related to estimated mineralization; operational and
management restructuring activities; capital expenditures (by
Comstock, Tonogold or other parties) and their impact; investments,
acquisitions, joint ventures, strategic alliances, business
combinations, asset sales; consulting, operational, tax, financial
and capital projects and initiatives; contingencies; environmental
compliance and changes in the regulatory environment; offerings,
sales, equity dilution, and other actions regarding debt or equity
securities; including a redemption of the debenture, and future
working capital, costs, revenues, business opportunities, debt
levels, cash flows, margins, earnings and growth. The words
“believe,” “expect,” “anticipate,” “estimate,” “project,” “plan,”
“should,” “intend,” “may,” “will,” “would,” “potential” and similar
expressions identify forward-looking statements, but are not the
exclusive means of doing so. These statements are based on
assumptions and assessments made by the management of Comstock and
Tonogold in light of their experience and their perception of
historical and current trends, current conditions, possible future
developments and other factors they believe to be appropriate.
Forward-looking statements are not guarantees, representations or
warranties and are subject to risks and uncertainties that could
cause actual results, developments and business decisions to differ
materially from those contemplated by such forward-looking
statements. Some of those risks and uncertainties include the risk
factors discussed in Item 1A, “Risk Factors” of the annual report
on Form 10-K of Comstock. Occurrence of such events or
circumstances could have a material adverse effect on the business,
financial condition, results of operations or cash flows or the
market price of Comstock and Tonogold’s securities. All subsequent
written and oral forward-looking statements by or attributable to
Comstock, Tonogold or persons acting on their behalf are expressly
qualified in their entirety by these factors. Neither Comstock nor
Tonogold undertake any obligation to publicly update or revise any
forward-looking statement. Neither this press release nor any
related calls or discussions constitutes an offer to sell or the
solicitation of an offer to buy any other securities of Comstock or
Tonogold.
Contact information: Comstock Mining, Inc. P.O. Box 1118
Virginia City, NV 89440 ComstockMining.com
Corrado De Gasperis Executive Chairman & CEO Tel (775)
847-4755 degasperis@comstockmining.com
Zach Spencer Director of External Relations Tel (775) 847-5272
ext.151 questions@comstockmining.com
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