Comstock Mining Inc

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Comstock Mining Inc


Disclaimer:

Statements contained in this blog, which are not historical facts, including statements about plans, goals and expectations regarding businesses and opportunities, new or existing business strategies, capital resources and future financial results are "forward looking" as contemplated by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, including, but not limited to, changes in government regulation, generally accepted accounting principles, taxation, competition, general economic conditions and geopolitical conditions. Accordingly, actual results may differ materially from those projected or implied in the forward-looking statements.




CEO Blog

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CEO Blog - Jan 9, 2011
Monday, January 10 2011 01:44
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Question: Will drill results be released as they are received or will they be withheld until a model has been established? Please provide a time frame if results will be released as received.  When can we expect the first assays from the recent drill program to be made public?


Answer: Our approach and intention is to release drill results timely, when they are meaningful against the objectives that we have established and communicated. It is also our preference to release drill hole information in the context of our geological model, rather than just as raw numbers. We will have an update on our drill program within the next week.

On November 8, we announced the exciting launch of the most robust drill program in our company’s history. The program includes over 100,000 feet of reverse circulation (RC) drilling, and has a planned duration of about seven months.  It includes a significant amount of development drilling in the Lucerne and Dayton Resource Areas. Development drilling is designed to provide information for a detailed mine plan, an important prerequisite for the Company's planned feasibility study and production.  Development drilling in the Lucerne Resource Area is focused on Hartford Hill, the currently planned location for a Lucerne starter pit.

It also includes exploration drilling on certain high priority targets within the Company's extensive Comstock district land holdings and condemnation drilling in the areas designated for possible heap leach pad expansion.

I would anticipate 3-4 updates between February and June, the planned length of this program.

We are nearly complete on the development drilling in the Lucerne Resource Area and we have begun development and exploration drilling in the Dayton Resource Area. Our update will share relevant results and insights of our progress so far and will also include assay results.

Kindest regards,

Corrado De Gasperis
President and CEO

 

 

 
CEO Blog - Nov 14, 2010
Sunday, November 14 2010 14:56
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Question: Does the Preferred Convertible Stock get force converted into Common Stock as soon as the share price hits $4.50?

Answer: The Preferred Convertible Stock (that is, only the Series A-2 and B) will be forced to convert into shares of common stock, if the daily volume weighted average price (VWAP) exceeds $4.50 for any 20 trading days during any 30 consecutive trading day period AND all the common stock underlying the Preferred Stock have been registered for resale (or may be sold without volume or manner of sale restrictions under Rule 144).  The Company will provide each holder with notice within one trading day of meeting the requirements specifying the date three trading days later when the conversion will take effect. 

If a forced conversion takes place, each share of Series A-2 and Series B preferred stock will convert into a number of shares of common stock equal to $1,000 (plus accrued and unpaid dividends) divided by the conversion price at such time.  If the forced conversion occurs before the third anniversary of the Series A-2 and Series B preferred stock, the holders will also receive a make-whole payment equal to the net present value (as of the date the conversion is effected) of the remaining dividend payments for that same three-year period.  If the make-whole payment is made in shares of common stock, the amount of additional shares of commons stock delivered will be equal to the amount of the make-whole payment calculated as set forth in the previous sentence divided by the average of the daily VWAPs for the 5 consecutive trading days ending on the trading day that is immediately prior to the date that the conversion will take effect.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Blog - Nov 13, 2010
Saturday, November 13 2010 14:48
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Question: How can I purchase Preferred Convertible Stock from the Company?

Answer: The Preferred Convertible Stock issued by the Company was sold in a private placement to institutional and accredited investors in a transaction that closed on October 20th. The company does not presently intend to raise additional capital through additional private placements and/or the sale of additional Preferred Convertible Stock. The Preferred Convertible Stock is not registered nor do we intend to register the Preferred Convertible Stock.  This means it is a restricted security and not freely trading.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Blog - Oct 21, 2010
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Comstock Mining Raises $35.75 million in New Equity

Comstock Exchanges All Senior Debt for Equity, Secures Land

 

We announced today the successful completion of the three remaining objectives of our previously announced restructuring and recapitalization plan. The completed objectives of the plan include raising $35.75 million of new equity from an outstanding group of institutional other accredited investors, exchanging all of our previously defaulted, senior secured debt and related obligations for equity and securing integral land mineral rights.

The new capital, successful debt restructuring and land consolidation represent a watershed event for the Company and it builds on the success of our recent NI 43-101 technical report, that validated total measured, indicated, inferred, and historic resources of over 1.6 million gold equivalent ounces and mapped a path for near-term production.

We couldn’t be more pleased with the tremendous quality and breadth of our expanded investor base. The strength of this capital raise coupled with the continued support of our existing stakeholders has positioned us with a strong and stable balance sheet for accelerated growth.  We appreciate the patience of our stakeholders and the persistence of our management team.

Moelis & Company acted as exclusive financial advisor to the Company.  Moelis & Company also acted as lead placement agent and Global Hunter Securities, Rodman & Renshaw, LLC, Merriman Capital Inc., Legend Merchant Group Inc., and Anderson & Strudwick, Inc., acted as placement agents in connection with the private placement.

The recapitalization was a critical prerequisite of strategic plan. The goal of that plan includes enhancing stockholder value by commencing commercial mining and processing operations in 2011, and validating qualified resources of at least 3,250,000 gold equivalent ounces by 2013.

The following are key highlights from the transactions:

  • Exchanged all $29.4 million of its defaulted senior secured convertible notes and related obligations for shares of a newly created Series A-1 Convertible Preferred Stock and Series A-2 Convertible Preferred Stock (collectively, the “Series A Preferred Stock”). This transaction also clears all defaults under the terms of the notes being converted.

  • Raised $35.75 million in gross proceeds ($32.75 million, net of commissions and transaction related expenses) by issuing shares of a newly created Series B Preferred Convertible Stock (“Series B Preferred Stock”) to fund the Company’s business plan to accelerate mine development and production and enhance exploration.

  • Acquired exclusive rights of production and exploration with respect to extensive mining property, integral to the Company’s nearly 6,000-acre land position, through an operating venture agreement, named Northern Comstock LLC.

 

Securing these exploration target-rich land and mineral rights in a long-term and safely capitalized manner, completes the consolidation of the Comstock Lode District and enables tremendous exploration potential.  These properties include the historically bonanza-rich Gould and Curry, Woodville, Savage, Hale-Norcross, Yellow Jacket, Justice and Keystone properties, among many, many others. Our fall drilling program is on target for commencement on Monday, October 25, and we look forward to the results of our ongoing metallurgical testing by February, both representing key prerequisites for commencing production in 2011.

The Company has also agreed to file a registration statement with the Securities and Exchange Commission covering the resale of the shares of common stock underlying the Series A Preferred Stock and the Series B Preferred Stock.  The Company is also pursuing a listing of its Common Stock on both the TSX Venture Exchange and the NYSE AMEX.

We also filed a prelease release and a Current Report on Form 8-K filed today with the U.S. Securities and Exchange Commission.  Please refer to both of those publically available documents, the former on our website and the latter on www.sec.gov.

In addition, we have updated the Company Overview presentation located here.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Q & A - Sep 30, 2010
Thursday, September 30 2010 12:14
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Question: When will be the recapitalization be accomplished? Is there a new timeline? I am a believer in the upside and given what you have already provided as resource figures, believe your stock would be a triple, at least - without additional reserves. Is there a new issue? I believe the delay has caused a cap on the stock's price and volume.

Answer: First let me say that I appreciate that when I previously responded to a question about production start up, I commented that I did not expect the capital raising activities to delay past September. I have also previously stated that we cannot set a specific date for those activities to be completed because of the importance of these transactions to our enterprise. I can, however, acknowledge again, that the ongoing efforts to recapitalize our balance sheet, finalize all land transactions and raise new capital have been and continue to be extremely productive. As a reminder, the Board has approved a five step strategic plan designed to restructure and recapitalize the Company, accelerate mine development and production and continue exploration. The principal features of the plan encompass a recapitalization and balance sheet restructuring that included a management reorganization, a now successfully implemented reverse stock split, a debt-for-equity exchange, a land transaction and a new capital raise to fund gold mine operations, exploration and development. The intention is clearly to emerge with a strong balance sheet and a funded plan. Substantially all of these activities are near completion and we remain on track for meeting all of these objectives, including the raising of new equity capital. The timing depends on synchronizing these activities and we will announce any salient news when the transactions are completed. We are also positive believers in the vast potential of the Comstock and we appreciate everyone's patience and continuing support throughout these critical initiatives.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Q & A - Sep 16, 2010
Thursday, September 16 2010 16:33
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Question: What has happened to my Goldspring shares. Surely they should have been converted into LODE.OB shares.

Answer: When you own shares of a company’s stock, you can hold the shares in two different ways: You can hold your shares in “street name,” such as in a brokerage account or in the name of a bank or other Nominee or you can hold your shares registered in your name as evidenced by a stock certificate. Upon the approval of our name and ticker symbol change by the Financial Industry Regulatory Authority (“FINRA”), shares held by you in street name were automatically changed from shares of GoldSpring Inc. to shares of Comstock Mining Inc. on the electronic record keeping system.  If you hold your shares registered in your name with a stock certificate issued by GoldSpring Inc., you can exchange your old certificate for a new certificate issued by Comstock Mining Inc. It is not required, however, that you obtain a new certificate.  If you would like to obtain a new certificate, you may contact our transfer agent at the following address/contact information.  Please note, however, that there is a fee for exchanging the certificate (approximately $31.00 for a U.S. shareholder and approximately $75.00 for a non-U.S. shareholder).

Corporate Stock Transfer Inc.  
3200 Cherry Creek Drive South, Suite 430
Denver, CO  80209
Telephone: 303-282-4800
Fax: 303-282-5800

 
CEO Q & A - Sep 2, 2010
Thursday, September 02 2010 04:00
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Question: I thought a new 43-101 was due out in early August?  Any idea if this is getting close?

Answer:  Our second National Instrument 43-101 (NI 43-101) technical report (the “August Report”) authored by Behre Dolbear & Company (USA) Ltd (“Behre Dolbear”), of Denver Colorado, has passed final quality review by Behre Dolbear.  The process took slightly longer because we expanded the scope to include our newly acquired Dayton Resource Area.  We will issue a press release on Tuesday, September 7, 2010 summarizing the results of the report and post the full report to our website within 48 hours of our press release.

 
CEO Q & A - Aug 24, 2010
Tuesday, August 24 2010 15:32
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Question:  Can we expect financing news before Labor Day? Is LODE planning on moving to NASDAQ or AMEX?

Answer:  The first question, not surprisingly, is our most frequently asked question.  It is also the question that we are most limited in answering until we finalize the transactions.   We can, however, acknowledge that the ongoing efforts to recapitalize our balance sheet have been extremely productive. As a reminder, the Board has approved a five step strategic plan designed to restructure and recapitalize the Company, accelerate mine development and production and continue exploration.  The principal features of the plan encompass a recapitalization and balance sheet restructuring that included a management reorganization, a now successfully implemented reverse stock split, a debt-for-equity exchange, a land transaction and a new capital raise to fund gold mine operations, exploration and development.  We are on track for meeting all of these objectives, including the raising of new equity capital.  The timing depends on synchronizing these activities and we will announce any salient news when the transactions are completed. Lastly, while our bridge financing allows for the continuation of most production project tasks, including mine planning and all metallurgical testing activities critical for finalizing production plans, certain capital-sensitive tasks require additional funding.  If our capital raising activities delay past September, which we do not anticipate, then production start up would be delayed accordingly.

The second part of the question was effectively answered in my August 3, 2010, blog.  I have republished it below for convenience.

Answer:  As part of our planned restructuring and recapitalization, it is fully anticipated that we will commit to listing on a nationally recognized exchange.  There are various trading markets in both the U.S. and Canada that would welcome Comstock Mining Inc., (LODE) on their exchange, when compliant with their criteria.  Although we are fully compliant with all public disclosure and reporting requirements, each exchange has various other prerequisite listing criteria that we must comply with (for example, a minimum share price or certain board configuration, technical reviews, etc.).

There are also administrative and regulatory review processes (that can be iterative) that we must also undertake before acceptance on a new exchange.  We have reviewed the criteria and believe that we can upgrade our listing within nine months of raising our new equity capital.  In some instances, it could take more time. In the interim, we are implementing the positive governance and process changes that we believe all companies should hold themselves to - that is, the highest disclosure, communications and governance standards, regardless of regulatory oversight.

As part of this process, we will soon begin posting updated corporate governance documents, such as Board and Committee Charters and a revised Code of Conduct and Business Ethics. We understand that a national listing and these corporate governance processes provide higher confidence and possibly better liquidity for our investors and hope to achieve those listings as soon in 2011 as practical.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Q & A - Aug 9, 2010
Monday, August 09 2010 14:00
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Question: When will mining restart?

Answer: Our entire team (Board, Management and Keen Stakeholders) supports our objectives of initial production of up to 20,000 ounces of gold per annum, starting in 2011.

Certain mine sites in Storey County, Nevada are permitted for production of ore.  This resulted from a successful, multi-year, multi-million dollar regulatory process.  We are permitted for production at our existing heap leach facility for processing that includes the production of metal rich precipitate. We are in the process of completing an application for a newly required mercury air permit, under a new permit program by the Nevada Division of Environmental Protection - Bureau of Air Quality. Upon applying for and receiving the new mercury air quality permit, the operation will be able to make the finish metal dore for sale to refineries. We are also in the process of amending our existing air quality permit to include new crushing equipment and process up-grades.  The amendment will be prepared based on metallurgical test results. We are effectively permitted for mining up to 720,000 tons of ore grade material per annum and the process permits amendments are systematically being advanced.  Our permitting position is a significantly more advanced one than most exploration-only companies planning for production.  

While we anticipate meeting our mining start up schedule in early 2011, that is, anywhere between March and June, this is fully dependent on some critical factors. As disclosed in our May 17, 2010, NI 43-101 report, we still have some prerequisite tasks for completing our mine and production plans, including extensive metallurgical testing to finalize the design of our heap leach process and related economic requirements. The metallurgical test results enable a more economically predictable, stable and effective production start up.  

Lastly, while our bridge financing allows for the continuation of most production project tasks, certain capital-sensitive tasks require additional funding.  If our capital raising activities are delayed past September, which we do not anticipate, then production start up would be delayed accordingly.

We will publish the progress on these activities timely, both through the continuous NI 43-101 updates and informative releases and postings, as we complete the intermediate objectives noted above.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Q & A - Aug 7, 2010
Saturday, August 07 2010 04:00
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Question: Do you plan to make the presentation materials recently presented at the NV conference available to the public?  

Answer: We will post presentation materials, both technical and non-technical, from conferences and meetings that we believe enhance and effect better communications and understanding of our Company, its goals and project plans and methodologies for achieving them.  This will include technical and non-technical information.  For example, our website includes our full National Instrument (NI) 43-101 report published in May 2010, with no redactions.   This is the most comprehensive, independently verified report on our Comstock resource.  Our Chief Geologist, Mr. Larry Martin, CPG, also presented a technical paper at the May 2010 GSN Annual Meeting entitled, “Rethinking the Comstock: Volcanic Domes and the Arcuate Structures.”  This paper and corresponding presentation was made available today concurrently with this blog and can be found under Properties>Technical Reports> Re-thinking the Comstock: Volcanic Domes and ArcuateStructures.

Kindest regards,

Corrado De Gasperis
President and CEO

 
CEO Q & A - Aug 3, 2010
Tuesday, August 03 2010 04:00
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Question: What is your timeline for changing indices, that you are listing on a nationally recognized stock exchange other than the Over the Counter Bulletin Board (OTCBB)?

Answer: As part of our planned restructuring and recapitalization, it is fully anticipated that we will commit to listing on a nationally recognized exchange.  There are various trading markets in both the U.S. and Canada that would welcome Comstock Mining Inc., (LODE) on their exchange, when compliant with their criteria.  Although we are fully compliant with all public disclosure and reporting requirements, each exchange has various other prerequisite listing criteria that we must comply with (for example, a minimum share price or certain board configuration, technical reviews, etc.).

There are also administrative and regulatory review processes (that can be iterative) that we must also endure, time-wise, before acceptance on a new exchange.  We have reviewed the criteria and believe that we can upgrade our listing within nine months of raising our new equity capital.  In some instances, it could take more time. In the interim, we are implementing the positive governance and process changes that we believe all companies should hold themselves to, that is, the highest disclosure, communications and governance standards, regardless of regulatory oversight.

We will soon begin posting documents such as Board and Committee Charters, well in advance of requiring them for upgrading our listings. We understand that the oversight provides higher confidence and possibly better liquidity for our investors and hope to achieve those listings as soon in 2011, as practical.

Kindest regards,

Corrado De Gasperis
President and CEO

 
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