Endeavour Silver to Acquire Silver Standard's (SSRI) Parral Properties
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Silver Standard Resources Inc. (Nasdaq: SSRI) announces that it has entered into a definitive agreement with Endeavour Silver Corp. (NYSE: EXK) to sell 100% of its Parral properties in Chihuahua, Mexico, including the Veta Colorada, La Palmilla, and San Patricio properties (collectively, the "Parral properties"). Endeavour Silver is a mid-tier precious metals company with a track record of exploring for, developing and operating mines in Mexico.
Paul Benson, President and CEO of Silver Standard said, "The sale of these non-core properties demonstrates our focus on optimizing the portfolio and maximizing value from all of our assets. Through this transaction, we retain exposure to the success of the properties and, importantly, we are enabled to redirect capital elsewhere in our portfolio to continue generating value for our shareholders."
Under the terms of the definitive agreement, Silver Standard will sell its interest in the Parral properties for aggregate consideration of:
- $6.0 million of Endeavour Silver shares issued at closing (based on the average of the closing prices of Endeavour Silver shares sold on the NYSE during the ten trading days prior to the date of the definitive agreement);
- The right to receive $200,000 of Endeavour Silver shares for each one million silver ounces included in an estimate of Measured and Indicated Mineral Resources in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects to be prepared by Endeavour Silver in respect of the San Patricio and La Palmilla properties (the "Resource Estimate"); and
- 1.0% net smelter returns royalty on all mineral products from the San Patricio and La Palmilla properties.
In addition, Endeavour Silver has committed to perform a minimum $2.0 million exploration program over a two-year period on the San Patricio and La Palmilla properties, and is required to complete the Resource Estimate within one year after the completion of such program. Completion of the transaction is subject to customary closing conditions, including NYSE and TSX approval. Silver Standard expects the transaction to close in the fourth quarter of 2016.
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