Ranchero Gold Announces Convertible Loan

VANCOUVER, British Columbia, Sept. 26, 2022 (GLOBE NEWSWIRE) -- Ranchero Gold Corp. (“Ranchero” or the “Company”) (TSX.V: RNCH) announces that it has signed a Letter of Intent (“LOI”) for a US$500,000 working capital loan (the “Loan”) from American PT Metals LLC. (“American Metals”) through its wholly owned subsidiary Mexico Minerales y Metales Earth S.A. de C.V. The principal amount of the Loan, which bears an annual interest rate of 12%, will be convertible during its two-year term into common shares of the Company at a price of $0.085 per share in the first year and C$0.10 in the second year. American Metals is an investment fund focused on natural resources.

In the event that Ranchero completes a financing in excess of $1 million during the term of the Loan, the Loan will become immediately payable, and Ranchero will use commercially reasonable efforts, subject to TSX Venture Exchange approval, to complete a share for debt application in respect of the Loan on the same terms as the financing.  

The Company will use the proceeds of the Loan to meet its general working capital requirements and fund on-going exploration efforts currently underway at its flagship Santa Daniela gold project. The Loan remains subject to the approval of the TSX Venture Exchange. Any securities issued in connection with the Loan will be subject to a hold period under applicable securities laws ending four months and one day after the initial advancement of the Loan.

Gustavo Mazon, a control person of the Company, is also a control person of American Metals. Therefore, the Loan would be considered to be a "related party transaction" as defined under Multilateral Instrument 61-101 – Protection of Minority Securityholders in Special Transactions ("MI 61-101"). The Loan will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any shares issued to or the consideration payable pursuant to the Loan will exceed 25% of the Company's market capitalization. Prior to the advancement of the Loan, it will be approved by Board of the Directors of the Company, with Mr. Mazon abstaining from such approval.

The Company anticipates closing on the Loan as soon as a definitive agreement is completed and all required approvals are received.

About Ranchero

Ranchero is a gold exploration and development company currently focused on its 100%-owned Santa Daniela project located in Sonora, Mexico. The Santa Daniela project consist of a large land package in excess of 22,200 hectares within Mexico’s Sierra Madre Occidental - a newly emerging gold belt. The Santa Daniela project is also near a number of major gold mining operations in the region. Maiz Azul is the Company’s most advanced prospect where exploration efforts are underway.

On behalf of the Board of Directors of the Company:

William Pincus

Chief Executive Officer and Director

Neither the 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.

FORWARD LOOKING STATEMENTS

This press release contains forward looking statements within the meaning of applicable securities laws. The use of any of the words “anticipate”, “plan”, “continue”, “expect”, “estimate”, “objective”, “may”, “will”, “project”, “should”, “predict”, “potential” and similar expressions are intended to identify forward looking statements. In particular, this press release contains forward looking statements concerning the planned completion of the Loan. Although the Company believes that the expectations and assumptions on which the forward looking statements are based are reasonable, undue reliance should not be placed on the forward looking statements because the Company cannot give any assurance that they will prove correct. Since forward looking statements address future events and conditions, they involve inherent assumptions, risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of assumptions, factors and risks. These assumptions and risks include, but are not limited to, assumptions and risks associated with the state of the equity financing markets and regulatory approval.

Management has provided the above summary of risks and assumptions related to forward looking statements in this press release in order to provide readers with a more comprehensive perspective on the Company’s future operations. The Company’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive from them. These forward looking statements are made as of the date of this press release, and, other than as required by applicable securities laws, the Company disclaims any intent or obligation to update publicly any forward looking statements, whether as a result of new information, future events or results or otherwise.