Coeur Completes Sale of its La Preciosa Project

Rhea-AI Summary

Coeur Mining, Inc. has successfully completed the sale of its La Preciosa silver project in Durango, Mexico, to Avino Silver & Gold Mines Ltd. The deal includes various components: $15.3 million in cash, a $5 million promissory note, equity consideration of 14 million units, deferred cash of approximately $8.8 million, and contingent payments of $0.25 per silver equivalent ounce, capped at $50 million. The transaction aligns with Coeur's strategy to divest non-core assets and focus on high-return projects, including the Rochester POA 11 expansion in Nevada, expected by mid-2024.

Positive

• Secured $15.3 million cash and $5 million promissory note from the sale.
• Equity stake in Avino with 14 million units received.
• Deferred cash payments of approximately $8.8 million linked to future production.
• Potential for contingent payments up to $50 million based on new mineral reserves.
• Transaction supports the strategy to prioritize high-return investments.

Negative

• None.

CHICAGO--(BUSINESS WIRE)-- Coeur Mining, Inc. (“Coeur” or the “Company”) (NYSE: CDE) today announced that it has closed the sale of its La Preciosa silver project, which is located in the State of Durango, Mexico, to Avino Silver & Gold Mines Ltd. (“Avino”) (TSX/NYSE American: ASM) by way of the previously announced definitive agreement (the “Agreement”).

Pursuant to the Agreement, the transaction consideration includes:

• $15.3 million cash paid at closing,
• $5.0 million promissory note that matures prior to the first anniversary of the transaction closing,
• Equity consideration of 14.0 million units, paid at closing, each consisting of one share of Avino common stock and one half of one common share purchase warrant of Avino common stock, priced at a 25% premium to the 20-day volume weighted average price as of October 26, 2021,
• Deferred cash consideration of approximately $8.8 million to be paid no later than the first anniversary of initial production from any portion of the La Preciosa project,
• Contingent payments of $0.25 per silver equivalent ounce (subject to an inflationary adjustment) on any new mineral reserves discovered and declared outside of the current resource area at the La Preciosa project, up to a maximum payment of $50.0 million, and
• Two royalties covering the La Preciosa land package, including (i) a 1.25% net smelter returns royalty on properties covering the Gloria and Abundancia areas of the La Preciosa project and (ii) a 2.00% gross value royalty on all areas of the La Preciosa project other than the Gloria and Abundancia areas, offset by the amount of any new mineral reserve contingent payments made to Coeur

In connection with the transaction, Coeur will be granted preemptive rights to maintain its pro rata interest in Avino and the right to appoint one director to Avino’s Board of Directors or a board observer so long as Coeur maintains a minimum ownership of 10% in Avino.

The sale of La Preciosa is consistent with the Company’s strategy of monetizing non-core assets and prioritizing high-return growth from investments in exploration and expansions at its North American assets including the Rochester POA 11 expansion in Nevada, which is expected to be completed mid-next year.

About Coeur

Coeur Mining, Inc. is a U.S.-based, well-diversified, growing precious metals producer with four wholly-owned operations: the Palmarejo gold-silver complex in Mexico, the Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska and the Wharf gold mine in South Dakota. In addition, The Company wholly-owns the Silvertip silver-zinc-lead development project in British Columbia and has interests in several precious metals exploration projects throughout North America.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220321005724/en/

Coeur Mining, Inc.

Jeff Wilhoit, Director, Investor Relations

Phone: (312) 489-5800

www.coeur.com

Source: Coeur Mining, Inc.

FAQ

What is the sale price of Coeur Mining's La Preciosa silver project?

The La Preciosa silver project was sold for a total of $15.3 million in cash, $5 million in a promissory note, and additional contingent payments and royalties.

Who bought Coeur Mining's La Preciosa silver project?

Avino Silver & Gold Mines Ltd. purchased Coeur Mining's La Preciosa silver project.

What are the key components of the La Preciosa sale agreement?

Key components include $15.3 million cash, a $5 million promissory note, equity of 14 million units, $8.8 million in deferred cash, and contingent payments based on new mineral reserves.

How does the sale of La Preciosa affect Coeur Mining's strategy?

The sale aligns with Coeur's strategy to monetize non-core assets and focus on high-return growth from North American projects.

What contingent payments are associated with the La Preciosa project sale?

Coeur Mining can receive contingent payments of $0.25 per silver equivalent ounce on new mineral reserves, with a maximum total of $50 million.