We estimate that the net proceeds we will receive from this offering will be
approximately $ million, based on the public offering price of $ per
share, after deducting the placement agent fee and estimated offering expenses
of $ .
We currently intend to use the net proceeds from this offering for growth
permitting land purchases and general corporate purposes. We are accelerating
prerequisite environmental studies, engineering and permitting for growing
production through the commercial development and expansions of both the
Lucerne and Dayton Mine plans. We also have an option on lands designated for
expansion of our processing facilities associated with this growth. We are
also planning higher production rates in 2013, potentially up to 1.5 million
tons per annum. We believe that this will enhance our flexibility to maximize
the speed that we can ramp up production and expand the mines.
Pending the application of the net proceeds as described above, we may invest
the net proceeds from this offering in short-term, investment grade, interest-
bearing securities.
Company Description
The Company is a Nevada-based, gold and silver mining company with extensive,
contiguous property in the historic Comstock and the Silver City mining
districts (collectively, the “Comstock District”). The Comstock District is
located within the western portion of the Basin and Range Providence
of
Nevada, between Reno and Carson City. The Company was incorporated in Florida
in 1999 and reincorporated in Nevada in 2008. The Company began acquiring
properties and developing projects in the Comstock District in 2003. Since
then, the Company has consolidated a substantial portion of the Comstock
District, secured permits, built an infrastructure and brought exploration
projects into production.
Because of the Comstock District’s historical significance, the geology is
well known and has been extensively studied by the Company, our advisors and
many independent researchers. We have expanded our understanding of the
geology of the project area through vigorous surface mapping and drill hole
logging. The volume of geologic data is immense, and thus far the reliability
has been excellent, particularly in the various Lucerne Mine areas. We have
amassed a large library of historical and current data and detailed surface
mapping of Comstock District properties. We use such data in conjunction with
our drilling programs to expand our understanding of the local and regional
geology.
Our Lucerne Resource Area is located in Storey County, Nevada, approximately
three miles south of Virginia City and 30 miles southeast of Reno. Our Dayton
Resource Area, is located in Lyon County Nevada, approximately six miles south
of Virginia City. Access to the properties is by State Route 342, a paved
highway.
The near term goal of our business plan is to deliver stockholder value by:
1) validating qualified resources (measured and indicated) and reserves
(probable and proven) of at least 3,250,000 gold equivalent ounces from our
first two resource areas, Lucerne and Dayton; 2) achieving initial commercial
mining and processing operations in the Lucerne Mine with annual production
rates of approximately 20,000 gold equivalent ounces; and 3) growing
production through the commercial development and expansions of both the
Lucerne and Dayton Mine plans.
As part of this plan, the Company has developed the exploration and development
drilling programs intended to validate mine design for the Lucerne and Dayton
Mines and also, to identify qualified resources and reserves in these two
resource areas with three intermediate objectives of validating measured and
indicated resources containing 1,000,000, 1,500,000 and 2,000,000 gold
equivalent ounces, respectively and the remaining planned objective of
3,250,000 gold equivalent ounces. The Company has already met the first three
intermediate resource validation objectives by validating measured and
indicated resources containing over 2,000,000 gold equivalent ounces.
The Company has also developed a mine plan intended to achieving initial
commercial mining and processing operations in the Lucerne Mine and ramp those
annual production rates to approximately 20,000 gold equivalent ounces. The
Company achieved initial production and held its first pour of gold and silver
on September 29, 2012, with three remaining intermediate objectives from
ramping up production to rates of 15,000, 17,500 and 20,000 gold equivalent
ounces per annum, respectively.
We continue acquiring additional properties in the Comstock District,
expanding our footprint and creating opportunities for exploration and mining.
The Company now owns or controls approximately 5,900 acres of mining claims
and parcels in the Comstock and Silver City Districts. The acreage is
comprised of approximately 1,350 acres of patented claims (private lands) and
surface parcels (private lands) and approximately 4,550 acres of unpatented
mining claims, which the Bureau of Land Management (“BLM”) administers.
---------
The Company’s executive offices are located at 1200 American Flat Road,
Virginia City, Nevada 89440 and its telephone number is (775) 847-5272. The
Company’s mailing address is P.O. Box 1118, Virginia City, Nevada 89440. The
Company’s website address is www.comstockmining.com.