Guanajuato Silver Increases Size of Gold Loan Credit Facility to US$13.3M

VANCOUVER, BC / ACCESSWIRE / February 29, 2024 / Guanajuato Silver Company Ltd. (the "Company" or "GSilver") (TSXV:GSVR)(OTCQX:GSVRF) is pleased to announce that the previously arranged US$7.5 million Gold Loan Credit Facility financing with Ocean Partners UK Ltd. ("Ocean Partners") has been increased to US$13,300,000 (the "Expanded Facility"), (See GSilver News Release dated December 5, 2023 - "Guanajuato Silver Closes US$7.5 Million Credit Facility"). The loan facility is for a term of 36 months from the date of the initial draw; it is repayable in equal fixed monthly installments of gold totalling approximately 338 troy ounces per month for a period of 30 months following a six-month grace period from the date of the initial draw. The number of ounces to be delivered per month is based on a discount to the London Bullion Market Association (LBMA) gold closing price of US$2,046.95 on November 29, 2023, plus an imputed interest amount.

James Anderson, Chairman & CEO, said, "The expanded credit facility will provide enhanced financial flexibility as we look to expand production throughout 2024 at all four of our producing silver mines in Mexico. Approximately three years ago, from among numerous competing firms, we chose Ocean Partners to be our primary metals trader; daily we see evidence that this was an astute business decision. Ocean Partners has always acted as a genuine partner to our business in Mexico; their support remains invaluable as we grow GSilver into a significant producer of precious metals."

The additional principal amount of the Expanded Facility has been advanced in single draw to the Company. A portion of the Expanded Facility will be used to pay down a portion of the outstanding loan due to Ocean Partners totalling approximately $3.8 million (See GSilver news release dated August 30, 2022 - Guanajuato Silver Draws US$5,000,000 Credit Facility). The remainder of the funds will be used for capex initiatives and for general working capital purposes.

In connection with the Expanded Facility, the Company and an affiliate of Ocean Partners have also extended the concentrate sales agreements related to the El Cubo Mine Complex, Valenciana Mines Complex, the San Ignacio mine and Topia Mine to December 31, 2028. The Expanded Facility will be secured by a pledge of the shares and assets of GSilver's Mexican subsidiaries Minera Mexicana el Rosario, S.A. de C.V. and Obras Mineras el Pinguico, S.A. de C.V. The Company has the option to repay all or part of the Expanded Facility at any time with 30 days' notice and the payment of a fee of 3.0% of the Expanded Facility Amount repaid.