Luca Mining Corp. (“Luca” or the “Company”, formerly Altaley Mining Corporation.) (TSX-V: LUCA; OTCQX: LUCMF; Frankfurt: TSGA) is pleased to announce that it has closed the second tranche (the “Second Tranche”) of its previously announced non-brokered private placement (the “Private Placement”) for aggregate gross proceeds of $20,755,535.17 (see the Company’s news release dated March 31, 2023). Under the Second Tranche, the Company has sold 6,889,462 units of the Company (each, a “Unit”) at a price of CAD $0.35 per Unit for gross proceeds of CAD $2,411,312.20. On April 25, 2023, the Company closed the first tranche of the Private Placement for gross proceeds of CAD $18,344,222.97 (see the Company’s news release dated April 26, 2023). The aggregate gross proceeds are slightly higher than the original announced amount of $20,300,000 Each Unit consists of one common share of the Company (a “Share”) and one-half of one transferable share purchase warrant (each whole, a “Warrant”). Each Warrant entitles the holder thereof to acquire one additional Share (a “Warrant Share”) at a price of CAD $0.50 per Warrant Share until June 2, 2025 (the “Expiry Date”), subject to acceleration. If the closing price of the Shares on the TSX Venture Exchange or such other stock exchange as Luca is listed on exceeds CAD $0.90 for 15 consecutive trading days, the Company will earn the right, by providing notice (the "Acceleration Notice") to the warrant holders via a news release or written notice, to accelerate the Expiry Date of the Warrants to 4:00 P.M. (Vancouver time) on the 30th day from the date of the Acceleration Notice (the “Accelerated Expiry Date”). If the Company provides an Acceleration Notice, all Warrants that are not exercised by the Accelerated Expiry Date will expire.
All securities issued in connection under the Second Tranche are subject to a four month plus one day hold period under applicable Canadian securities laws. Finder’s fees are to be paid in cash and securities (6% cash and 6% in warrants) in connection with the Private Placement to various finders. The Private Placement is subject to the receipt of final approval from the TSXV.
As previously disclosed, the net proceeds from the Second Tranche will be used by the Company to complete construction of its phase one 500 tonnes per day (“tpd”) project at the Tahuehueto Gold Mine; to make substantial progress towards completing its nameplate 1,000 tpd project; and for general working capital.
“We are very pleased to announce this closing of the Private Placement, building on our first tranche announced on April 26th. Securing this level of support from existing and new investors, at a very challenging time in the markets generally, is testament to the confidence investors have in our turnaround plans and the new team,” commented Mike Struthers, CEO. “I’m also very pleased to say we are on track to achieve our first key milestone of 500 tonnes per day at Tahuehueto by the end of the month, as previously announced. I look forward to providing more updates in the near future”.
Concurrently with closing the Second Tranche, the Company is pleased to advise that it has also closed two debt settlements (the “Debt Settlements”) as part of its financing package (see the Company’s news release dated March 31, 2023). Pursuant to the initial debt settlement, Calu Opportunity Fund, LP (“Calu”) settled a loan in the amount of $3,714,729.11 in consideration of the issuance of 8,254,954 Shares at a price of $0.45 per Share. Pursuant to the second debt settlement, Calu settled an advance in the amount of $4,900,000 made as a standby guarantee under the proposed rights offering of the Company (which did not proceed) in consideration of the issuance of 14,000,000 units, having the identical terms as the Private Placement Units.
All securities issued in connection under the Debt Settlements are subject to a four month plus one day hold period under applicable Canadian securities laws. The Debt Settlements are subject to the receipt of final approval from the TSXV.
New Control Person
As a consequence of the closing of the Second Tranche and the Debt Settlements, Calu has been issued, in aggregate, 34,483,525 Shares and 13,114,285 Warrants, representing 26.55% of the issued and outstanding Shares of the Company on a post-closing basis. Accordingly, Calu has become the “Control Person” (as that term is defined under British Columbia securities laws and the policies of the TSXV) of the Company. The creation of Calu as a Control Person was approved by the Company’s shareholders at the Company Annual General Meeting held on March 14, 2023 (see the Company’s news release of March 17, 2023).
"The completion of Luca Mining's private placement and the impending completion of construction at the Tahuehueto gold project marks a remarkable turning point for the company," explained Enrique Peralta. "We, at Calu Opportunity Fund, are truly excited about the potential and long-term value that Luca Mining brings to the table. This significant progress solidifies our confidence in the company's ability to deliver outstanding results and generate substantial returns for its shareholders."
About Luca Mining Corp.
Luca Mining Corp is a Canadian based mining company with two 100% owned Mexican gold, silver, and base metal mining projects.
Luca's Tahuehueto mining project is in north-western Durango State, Mexico, where construction of an initial 500 tpd operation is well advanced. The second stage, the 1000 tpd project, will follow immediately after commissioning the initial stage. The operation is generating gold, silver, lead, and zinc in concentrates.
Campo Morado is an operating polymetallic base metal mine in Guerrero, Mexico, currently producing at an average of approximately 2,400 tonnes per day, generating zinc and copper concentrates with significant precious metal credits.
On Behalf of the Board of Directors
(signed) “Mike Struthers”
CEO and Director
Cautionary Note Regarding Production Decisions and Forward-Looking Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
It should be noted that Luca declared commercial production at Campo Morado prior to completing a feasibility study of mineral reserves demonstrating economic and technical viability. Accordingly, readers should be cautioned that Luca’s production decision has been made without a comprehensive feasibility study of established reserves such that there is greater risk and uncertainty as to future economic results from the Campo Morado mine and a higher technical risk of failure than would be the case if a feasibility study were completed and relied upon to make a production decision. Luca has completed a preliminary economic assessment (“PEA”) mining study on the Campo Morado mine that provides a conceptual life of mine plan and a preliminary economic analysis based on the previously identified mineral resources (see News Release dated November 8, 2017, and April 4, 2018). ). Furthermore, It should be noted that Luca intends to commence pre-production and ramp up to full commercial production at Tahuehueto prior to completing a feasibility study of mineral reserves demonstrating economic and technical viability. Accordingly, readers should be cautioned that Luca’s pre-production and production decisions will be made without a comprehensive feasibility study of established reserves such that there is greater risk and uncertainty as to future economic results from the Tahuehueto mine and a higher technical risk of failure than would be the case if a feasibility study were completed and relied upon to make such production decisions. Luca has completed a positive pre-feasibility study (the “Pre-Feasibility Study”) and updated mineral reserves/resources estimates at its flagship Tahuehueto Mine that provides a conceptual life of mine plan and a preliminary economic analysis based on a 1,000 tonne per day operation (see News Release dated March 7, 2022)
Statements contained in this news release that are not historical facts are "forward-looking information" or "forward-looking statements" (collectively, "Forward-Looking Information") within the meaning of applicable Canadian securities laws. Forward-Looking Information includes but is not limited to conditions or financial performance that are based on assumptions about future economic conditions and courses of action; the timing and costs of future activities on the Company's properties, such as production rates and increases; success of exploration, development and bulk sample processing activities, and timing for processing at its own mineral processing facility on the Tahuehueto project site. In certain cases, Forward-Looking Information can be identified using words and phrases such as "plans," "expects," "scheduled," "estimates," "forecasts," "intends," "anticipates" or variations of such words and phrases. In preparing the Forward-Looking Information in this news release, the Company has applied several material assumptions, including, but not limited to, that the current exploration, development, environmental and other objectives concerning the Campo Morado Mine and the Tahuehueto Project can be achieved; that commencement of pre-production mining and milling operations at Tahuehueto will proceed as planned; the continuity of the price of gold and other metals, economic and political conditions, and operations. Forward-Looking Information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the Forward-Looking Information. There can be no assurance that Forward-Looking Information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on Forward-Looking Information. Except as required by law, the Company does not assume any obligation to release publicly any revisions to Forward-Looking Information contained in this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.