Comstock Mining Inc. (the “Company”) (NYSE American: LODE)
announced today that the Third Judicial District Court of the State
of Nevada, at a hearing held yesterday, ruled in favor of the
Company and Lyon County on the one remaining Due Process rights
claim associated with the Lyon County Board of Commissioners Master
Plan amendment and zone change associated with certain mineralized
properties within the Company’s Dayton Resource Area, just south of
the Company’s Lucerne properties and near Silver City,
Nevada.
The District Court found that the Comstock Residents Association
(the “CRA”), having been afforded the full opportunity to conduct
any and all discovery, failed to establish that the Lyon County
Board of Commissioners had denied the organization its due process
rights and reaffirmed prior favorable rulings.
The District Court’s ruling concludes that the Lyon County Board
of Commissioners satisfied constitutional due process requirements
and that the Commissioners were entitled to vote on the
applications filed by the Company, properly voted to approve the
Company’s requested Master Plan and zoning changes, denying the
CRA’s claims and reaffirming the propriety of the land use changes.
Corrado De Gasperis, Executive Chairman and CEO of the Company
stated, “This ruling was anticipated and deeply rewarding to hear
directly from Judge Robert Estes. Lyon County holds itself to
the highest standards of governance and transparent public process,
a critical component of our democratic processes, and this ruling
reaffirms the standard of excellence and transparency that we must
all hold ourselves to. We look forward to advancing the
community planning process with Silver City and Lyon County and
advancing the exploration, development and permitting of our
properties for their highest and best uses.”
This favorable, definitive ruling, along with the previous
favorable rulings and all other recent events, will be updated into
and included in the Company’s Financial Statements to be filed on
Form 10-Q with the Securities and Exchange Commission today or
before May 20, 2019. The Company’s unaudited financial
statements, as of and for the three months ended March 31, 2019,
have been included in an attachment to this release, for
convenience.
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 and developments 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 Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. All statements,
other than statements of historical facts, are forward-looking
statements. 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. Forward-looking statements include statements about
matters such as: future industry market conditions; future
explorations or acquisitions; future changes in our exploration
activities; future prices and sales of, and demand for, our
products; land entitlements and uses; production capacity and
operations; operating and overhead costs; future capital
expenditures and their impact on us; operational and management
changes (including changes in the board of directors); changes in
business strategies, planning and tactics; future employment and
contributions of personnel, including consultants; future land
sales investments, acquisitions, joint ventures, strategic
alliances, business combinations, operational, tax, financial and
restructuring initiatives; including the nature and timing and
accounting for restructuring charges, derivative liabilities and
the impact thereof; contingencies; environmental compliance and
changes in the regulatory environment; offerings, limitations on
sales or offering of equity or debt securities; including asset
sales and the redemption of the debenture and associated costs;
future working capital, costs, revenues, business opportunities,
debt levels, cash flows, margins, earnings and growth. These
statements are based on assumptions and assessments made by our
management 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, many of
which are unforeseeable and beyond our control and 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 set forth in this report and our Annual Report on Form
10-K for the fiscal year ended December 31, 2017, and the
following: adverse effects of climate changes or natural disasters;
global economic and capital market uncertainties; the speculative
nature of gold or mineral exploration, including risks of
diminishing quantities or grades of qualified resources;
operational or technical difficulties in connection with
exploration or mining activities; contests over our title to
properties; potential dilution to our stockholders from our stock
issuances, recapitalization and balance sheet restructuring
activities; potential inability to comply with applicable
government regulations or law; adoption of or changes in
legislation or regulations adversely affecting our businesses;
permitting constraints or delays; business opportunities that may
be presented to, or pursued by, us; acquisitions, joint ventures,
strategic alliances, business combinations, asset sales, and
investments that we may be party to in the future; changes in the
United States or other monetary or fiscal policies or regulations;
interruptions in our production capabilities due to capital
constraints; equipment failures; fluctuation of prices for gold or
certain other commodities (such as silver, zinc, cyanide, water,
diesel fuel and electricity); changes in generally accepted
accounting principles; adverse effects of terrorism and
geopolitical events; potential inability to implement our business
strategies; potential inability to grow revenues; potential
inability to attract and retain key personnel; interruptions in
delivery of critical supplies, equipment and raw materials due to
credit or other limitations imposed by vendors; assertion of
claims, lawsuits and proceedings against us; potential inability to
satisfy debt and lease obligations; potential inability to maintain
an effective system of internal controls over financial reporting;
potential inability or failure to timely file periodic reports with
the SEC; potential inability to list our securities on any
securities exchange or market; inability to maintain the listing of
our securities; and work stoppages or other labor difficulties.
Occurrence of such events or circumstances could have a material
adverse effect on our business, financial condition, results of
operations or cash flows or the market price of our securities. All
subsequent written and oral forward-looking statements by or
attributable to us or persons acting on our behalf are expressly
qualified in their entirety by these factors. Except as may be
required by securities or other law, we undertake no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.
Neither this press release nor any related calls or discussions
constitutes an offer to sell or the solicitation of an offer to buy
the Debenture or any other securities of the Company. 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.151questions@comstockmining.com
COMSTOCK MINING INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETS(UNAUDITED)
|
March 31, 2019 |
|
December 31, 2018 |
ASSETS |
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
Cash and cash equivalents |
$ |
310,596 |
|
|
$ |
488,657 |
|
Assets held for sale, Net (Note 2) |
6,902,600 |
|
|
5,363,403 |
|
Prepaid expenses and other current assets (Note 3) |
2,874,842 |
|
|
2,712,202 |
|
Total current assets |
10,088,038 |
|
|
8,564,262 |
|
|
|
|
|
MINERAL RIGHTS AND PROPERTIES,
Net |
5,690,884 |
|
|
7,205,081 |
|
PROPERTIES, PLANT AND
EQUIPMENT, Net (Note 4) |
9,148,087 |
|
|
9,742,120 |
|
RECLAMATION BOND DEPOSIT |
2,655,972 |
|
|
2,622,544 |
|
RETIREMENT OBLIGATION ASSET
(Note 5) |
186,335 |
|
|
203,274 |
|
OTHER ASSETS |
385,791 |
|
|
274,444 |
|
|
|
|
|
TOTAL ASSETS |
$ |
28,155,107 |
|
|
$ |
28,611,725 |
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
Accounts payable |
$ |
458,719 |
|
|
$ |
405,146 |
|
Accrued expenses and other liabilities (Note 6) |
3,103,137 |
|
|
1,674,733 |
|
Long-term debt– current portion (Note 7) |
314,303 |
|
|
309,843 |
|
Total current liabilities |
3,876,159 |
|
|
2,389,722 |
|
|
|
|
|
LONG-TERM LIABILITIES: |
|
|
|
Long-term debt (Note 7) |
7,981,123 |
|
|
8,857,870 |
|
Long-term reclamation liability (Note 8) |
7,446,801 |
|
|
7,441,091 |
|
Other liabilities |
572,719 |
|
|
538,140 |
|
Total long-term liabilities |
16,000,643 |
|
|
16,837,101 |
|
|
|
|
|
Total liabilities |
19,876,802 |
|
|
19,226,823 |
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
(Note 10) |
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY: |
|
|
|
Preferred Stock, $.000666 par value, 50,000,000 shares authorized;
no shares issued |
— |
|
|
— |
|
Common stock, $.000666 par value, 790,000,000 shares authorized,
80,790,273 and 75,338,273 shares issued and outstanding at
March 31, 2019, and December 31, 2018, respectively |
53,806 |
|
|
50,175 |
|
Additional paid-in capital |
242,144,734 |
|
|
241,419,897 |
|
Accumulated deficit |
(233,920,235 |
) |
|
(232,085,170 |
) |
|
|
|
|
Total stockholders’
equity |
8,278,305 |
|
|
9,384,902 |
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
$ |
28,155,107 |
|
|
$ |
28,611,725 |
|
COMSTOCK MINING INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(UNAUDITED)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
REVENUES |
|
|
|
Revenue - mining |
$ |
— |
|
|
$ |
— |
|
Revenue - real estate |
37,598 |
|
|
22,850 |
|
Total revenues |
37,598 |
|
|
22,850 |
|
|
|
|
|
COSTS AND
EXPENSES |
|
|
|
Costs applicable to mining
revenue |
505,393 |
|
|
728,904 |
|
Real estate operating
costs |
10,424 |
|
|
7,091 |
|
Exploration and mine
development |
225,867 |
|
|
209,538 |
|
Mine claims and costs |
150,954 |
|
|
180,231 |
|
Environmental and
reclamation |
53,451 |
|
|
58,068 |
|
General and
administrative |
660,366 |
|
|
726,620 |
|
Total costs and expenses |
1,606,455 |
|
|
1,910,452 |
|
|
|
|
|
LOSS FROM OPERATIONS |
(1,568,857 |
) |
|
(1,887,602 |
) |
|
|
|
|
OTHER INCOME (EXPENSE) |
|
|
|
Interest expense |
(461,137 |
) |
|
(383,340 |
) |
Other income (expense) |
194,929 |
|
|
(213,961 |
) |
Total other income (expense), net |
(266,208 |
) |
|
(597,301 |
) |
|
|
|
|
NET LOSS |
$ |
(1,835,065 |
) |
|
$ |
(2,484,903 |
) |
|
|
|
|
Net loss per common share –
basic and diluted |
$ |
(0.02 |
) |
|
$ |
(0.05 |
) |
|
|
|
|
Weighted average common shares
outstanding — basic and diluted |
79,080,429 |
|
|
49,863,424 |
|
COMSTOCK MINING INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS(UNAUDITED)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
OPERATING
ACTIVITIES: |
|
|
|
Net loss |
$ |
(1,835,065 |
) |
|
$ |
(2,484,903 |
) |
Adjustments to reconcile net
loss to net cash used in operating activities: |
|
|
|
Depreciation, amortization,
and depletion |
586,921 |
|
|
826,928 |
|
Accretion of reclamation
liability |
5,710 |
|
|
4,876 |
|
Gain on sale of properties,
plant, and equipment |
— |
|
|
(26,000 |
) |
Amortization of debt discounts
and issuance costs |
71,623 |
|
|
102,492 |
|
Net loss on early retirement
of long-term debt |
151,531 |
|
|
2,621 |
|
Payment-in-kind interest
expense |
470,246 |
|
|
— |
|
Change in make-whole liability
with Pelen, LLC |
(135,162 |
) |
|
216,147 |
|
Changes in operating assets
and liabilities: |
|
|
|
Prepaid expenses and other assets |
24,934 |
|
|
25,001 |
|
Accounts payable |
53,573 |
|
|
3,543 |
|
Accrued expenses and other liabilities |
(286,855 |
) |
|
230,368 |
|
NET CASH USED IN OPERATING
ACTIVITIES |
(892,544 |
) |
|
(1,098,927 |
) |
INVESTING
ACTIVITIES: |
|
|
|
Proceeds from principal
payment on note receivable |
130 |
|
|
119 |
|
Proceeds from sale of mineral
rights and properties, plant, and equipment |
— |
|
|
26,000 |
|
Proceeds from deposits on
Membership Interest Purchase Agreement |
1,950,000 |
|
|
— |
|
Purchase of mineral rights and
properties, plant and equipment |
(365,000 |
) |
|
— |
|
Change in reclamation bond
deposit |
(33,428 |
) |
|
— |
|
NET CASH PROVIDED BY INVESTING
ACTIVITIES |
1,551,702 |
|
|
26,119 |
|
FINANCING
ACTIVITIES: |
|
|
|
Principal payments on
long-term debt |
(1,565,687 |
) |
|
(99,005 |
) |
Proceeds from the issuance of
common stock |
813,561 |
|
|
1,185,452 |
|
Common stock issuance
costs |
(85,093 |
) |
|
(52,568 |
) |
NET CASH (USED IN) PROVIDED BY
FINANCING ACTIVITIES |
(837,219 |
) |
|
1,033,879 |
|
(DECREASE) IN CASH AND CASH
EQUIVALENTS |
(178,061 |
) |
|
(38,929 |
) |
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD |
488,657 |
|
|
2,066,718 |
|
CASH AND CASH EQUIVALENTS, END
OF PERIOD |
$ |
310,596 |
|
|
$ |
2,027,789 |
|
|
|
|
|
SUPPLEMENTAL CASH FLOW
INFORMATION: |
|
|
|
Cash paid for interest |
$ |
34,460 |
|
|
$ |
17,509 |
|
|
|
|
|
Supplemental
disclosure of non-cash investing and financing
activities: |
|
|
|
Common Stock Issuance
Costs |
$ |
— |
|
|
$ |
200,000 |
|
Issuance of common stock (in
advance) to purchase membership interest |
$ |
— |
|
|
$ |
585,000 |
|
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