Los Cerros Limited (ASX: LCL) (Los Cerros or the Company) is very pleased to announce the outcome of its capital raising via private placement to professional and sophisticated investors.
The Company received firm bids for more than four times the target, and has proceeded to accept binding commitments for a placement of $10 million (before costs) ('Placement'), being the Company's current maximum capacity under listing rules 7.1 and 7.1A.
Hartleys Limited is Lead Manager to the Placement.
The Placement puts Los Cerros in an extremely strong position to pursue a substantial and sustained three-rig diamond drilling program across multiple sites, and also make a one-off payment of A$2.21 million for the immediate extinguishment of an existing debt held by FirstRand Investment Holdings (Pty) Ltd (RMB), which would have otherwise totalled A$3.5 million ('Agreement')1 .
The Agreement also includes the reduction of potential future royalty payments on the Quinchia Project from A$15 million to A$14 million (payable at a rate of 2% of net smelter revenue).
Los Cerros' Managing Director Jason Stirbinskis commented; 'We view this incredibly strong result as a mandate to be bold and proactive in seizing the opportunity created by the confluence of our established strategic direction, recent drilling success, investor traction and strong gold price.
We are very pleased to see a number of reputable mining investors join our register with this Placement, and see it as a strong endorsement of the quality of the Quinchia Project. With very significant funding secured, the Los Cerros team can be entirely focussed on delivering results from the current multi-rig drill program and also bring forward a number of exploration initiatives and related strategies. We expect this coming year to be a very positive time for Los Cerros and for our shareholders'.
Capital Raising Details
Under the Placement the Company will issue up to 86,932,750 fully paid ordinary shares at an issue price of $0.115 per share, to raise up to approximately $10 million (before costs). The Placement has been made to 'professional and sophisticated' investors and is expected to settle on or around 23 September 2020 and is made at a 11.2% discount to the Company's 10 day VWAP.
In addition to the Placement, and subject to shareholder approval at the General Meeting, Los Cerros' Chairman, Ross Ashton will subscribe to $30,000. Mr Ashton is already one of the top 10 shareholders of the Company prior to the Placement. This announcement lifts the current Trading Halt in the Company's securities. For the purpose of ASX Listing Rule 15.5, the Board has authorised this announcement to be released.
Contact:
Jason Stirbinskis
Email: jason@loscerros.com.au
FORWARD LOOKING STATEMENTS
This document contains forward looking statements concerning Los Cerros. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward-looking statements as a result of a variety of risks, uncertainties and other factors. Forward-looking statements are inherently subject to business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of the Company. Such factors include, among other things, risks relating to additional funding requirements, metal prices, exploration, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes.
Forward looking statements in this document are based on Los Cerros' beliefs, opinions and estimates of Los Cerros as of the dates the forward-looking statements are made, and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments. Although management believes that the assumptions made by the Company and the expectations represented by such information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. 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 anticipated future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, the actual market price of gold, the actual results of future exploration, changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's publicly filed documents. Readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws. No representation, warranty or undertaking, express or implied, is given or made by the Company that the occurrence of the events expressed or implied in any forward-looking statements in this presentation will actually occur.
LOS CERROS LIMITED 
