TSX.V: SCZ
FSE: 1SZ
VANCOUVER,
Sept. 18, 2014
/PRNewswire/ - Santacruz Silver Mining Ltd. ("Santacruz" or the
"Company") (TSX.V:SCZ) is pleased to announce that it has
entered into a US$28.4 million
Pre-paid Silver Purchase Agreement with JMET, LLC to sell
4,635,000 ounces of silver through August
2019, subject to certain adjustments relating to metal
prices. In addition to US$ 28.4
million that will be paid to the Company up front upon
satisfaction of certain conditions, at the time of each delivery
the Company will receive an amount per ounce of silver equal to the
market price at the time, less a fixed discount. It is anticipated
that the upfront payment will be advanced within the next two
weeks. Under the agreement, the Company maintains the upside
on the silver price.
The main purpose of the agreement is to fund the Company's
future plans, including the development of the Company's second
project, San Felipe, in Sonora
State, Mexico.
Key aspects of the Pre-paid Forward Silver Purchase
Agreement:
- 5-year tenor
- No ounces will be delivered over the first 12 months followed
by deliveries of 7,500 oz of silver per month for 18 months and
150,000 oz of silver per month for 30 months
- Attractive cost of capital
- Santacruz Silver maintains 100%
upside on silver and all metal prices
- No warrants, shares or options are being issued in connection
with the agreement
- Pledging of the Company's assets as security for the up-front
payment
President Arturo Préstamo stated,
"We are very pleased to have entered into this contract. The
funding allows us to continue our plans to advance the San Felipe project in a non-dilutive way,
under a flexible and favorable financial structure while at the
same time maintaining the upside on the price of silver. With
the Rosario Mine starting to hit its targets, robust economics at
our San Felipe project, and this
non-dilutive financing now in place, we are well positioned to take
the next step in becoming a mid-tier silver producer. Our
approach has always been and will continue to be about creating
strong cash-flow producing operating mines. That is always the key
driver behind our decisions and we strive to deliver for our
shareholders on those objectives in the shortest time frame
possible."
About Santacruz Silver Mining Ltd.
Santacruz is a Mexican-focused silver company with a producing
mine (Rosario); two advanced-stage
projects (San Felipe and
Gavilanes) and an early-stage
exploration project (El Gachi). The Company is managed by a
technical team of professionals with proven track records in
developing, operating and discovering silver mines in Mexico. Our corporate objective is to become a
mid-tier silver producer.
'signed'
Arturo Préstamo Elizondo,
President, 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 information
Certain statements contained in this news release, such as
planned production levels, grades, mine and mill development, mill
recovery rates and the acquisition of mineralized material from
third parties, constitute "forward-looking information" as such
term is used in applicable Canadian securities laws.
Forward-looking information is based on plans, expectations and
estimates of management at the date the information is provided and
is subject to certain factors and assumptions, including, that the
Company's financial condition and development plans do not change
as a result of unforeseen events, that the Company obtains
regulatory approval, that the Company is able to obtain material
from third parties on reasonable terms, future metal prices and the
demand and market outlook for metals. Forward-looking information
is subject to a variety of risks and uncertainties and other
factors that could cause plans, estimates and actual results to
vary materially from those projected in such forward-looking
information. Factors that could cause the forward-looking
information in this news release to change or to be inaccurate
include, but are not limited to, the risk that any of the
assumptions referred to prove not to be valid or reliable, that
occurrences such as those referred to above are realized and result
in delays, or cessation in planned work, that the Company's
financial condition and development plans change, delays in
regulatory approval, risks associated with the interpretation of
data, the geology, grade and continuity of mineral deposits, the
possibility that results will not be consistent with the Company's
expectations, as well as the other risks and uncertainties
applicable to mineral exploration and development activities and to
the Company as set forth in the Company's Annual Information Form
filed under the Company's profile at www.sedar.com. There can be no
assurance that any forward-looking information will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
the reader should not place any undue reliance on forward-looking
information or statements. The Company undertakes no obligation to
update forward-looking information or statements, other than as
required by applicable law.
SOURCE SantaCruz Silver Mining Ltd.