VANCOUVER, BC, March 22,
2022 /CNW/ - Zacatecas Silver Corp. ("Zacatecas" or
the "Company" (TSXV: ZAC) (OTC Markets: ZCTSF) (Frankfurt: 7TV) is pleased to announce the
closing of a $19.15 million offering
of subscription receipts (the "Financing").
The Financing was previously announced on February 28, 2022 as a $15
million private placement and then, due to strong demand,
was upsized to $18 million on
March 4, 2022. Today, the Financing
has closed, on an oversubscribed basis, for total gross proceeds of
$19,151,521 pursuant to the issuance
of 17,410,474 subscription receipts (each a "Subscription Receipt")
at $1.10 per Subscription
Receipt.
Zacatecas CEO Bryan Slusarchuk states, "We appreciate the
strong support from the syndicate of agents on this transaction and
the buy side participants, which include outstanding institutional
and individual specialist investors in the metals space. We look
forward to moving the advanced stage and high-grade Esperanza Gold
Project towards production while also continuing our ongoing drill
program at the Zacatecas Silver Project, where we are currently
drilling to follow up on the recent high grade silver discovery at
Panuco North."
The proceeds raised from the Financing will be used to satisfy
the USD$5,000,000 cash consideration
in connection with the acquisition of the Esperanza Gold Project
from Alamos Gold Inc., begin advancing the Esperanza Gold Project
towards production, fund the ongoing drill program at the Company's
existing silver project and for general working capital
purposes.
Each Subscription Receipt is convertible into one unit of the
Company (each a "Unit") upon the completion of certain escrow
release conditions as described below. Each Unit will consist of
one common share of the Company (a "Common Share") and one-half of
one Common Share purchase warrant (each whole Common Share purchase
warrant a "Warrant"). Each Warrant will entitle the holder thereof
to purchase one Common Share at a price of $1.50 per Common Share for a period of 24 months
from the date of issue.
The proceeds of the Financing will be released from escrow, upon
notice given to the Escrow Agent on or prior to 5:00pm (Toronto
time) on May 21, 2022 upon (a) the
completion, satisfaction or waiver, as the case may be, of all the
conditions precedent to the acquisition of the Esperanza Gold
Project by the Company from a subsidiary of Alamos Gold Inc. (the
"Proposed Transaction") set forth in the share purchase agreement
between such parties dated February 28,
2022; and (b) the receipt of all required corporate,
shareholder and regulatory approvals in connection with the
Proposed Transaction ((a) and (b) together, the " Escrow Release
Conditions ").
Clarus Securities Inc. acted as Lead Agent on behalf of a
syndicate of agents that included Eventus Capital Corp., Haywood
Securities Inc. and Canaccord Genuity Corp. Zacatecas will
pay the syndicate of agents a cash commission of $998,716 (half of which was paid today and half
of which will be paid upon the release of proceeds from the
Financing to the Company from escrow) and issued a total of 907,924
compensation options (the "Compensation Options"), with each
Compensation Option exercisable into a Common Share at a price of
$1.10 for a period of 24 months from
the date of issue.
The securities issued under the Offering will be subject to
restrictions on resale expiring on July 23,
2022.
The securities referred to in this news release have not been,
nor will they be, registered under the United States Securities Act
of 1933, as amended, and may not be offered or sold within
the United States or to, or for
the account or benefit of, U.S. persons absent U.S. registration or
an applicable exemption from the U.S. registration requirements.
This release does not constitute an offer for sale of, nor a
solicitation for offers to buy, any securities in the United States.
Qualified person
The contents of this news release have been reviewed and
approved by Dr. Wilson, BSc (honours), PhD, FAusIMM (CP), FSEG,
chief operating officer of Zacatecas. Dr. Wilson is a qualified person as
defined by National Instrument 43-101 and is responsible for all
technical information in this news release.
About the Esperanza Gold Project
Esperanza is an advanced stage,
attractive low-cost, low-capital-intensity and low-technical-risk
growth project located in Morelos
state, Mexico. Alamos has progressed the project through
advanced engineering, including metallurgical work, while also
focusing on stakeholder engagement, including building community
relations.
To date, significant core and reverse circulation drilling has
occurred at the Esperanza gold
project, resulting in a total of 389 drill holes for 69,716 metres.
Four targets adjacent to or close to the historical resource were
identified to expand the historical resource. The project also
hosts seven regional exploration targets, largely untested, that
also merit drill testing.
Alamos reported in its most
recent annual information form a resource estimate of a measured
and indicated resource of 34,352,000 tonnes at 0.98 g/t gold and
8.09 g/t silver for 1,083,366 ounces of gold and 8,936,201 ounces
of silver and inferred resource of 718,000 tonnes at 0.80 g/t gold
and 15.04 g/t silver for 18,375 ounces of gold and 347,192 ounces
of silver. The Company considers this to be an historical resource
for the purposes of National Instrument 43-101. Resource blocks
were defined using with dimensions of 10 metres (m) by 10 m by five m. The
estimation of grades was performed with the ordinary kriging method
on capped composites. An added step in the estimation strategy was
the utilization of the dynamic anisotropy technique in Vulcan's unfolding options. This added
capability allows for a more realistic outcome of the estimated
grade's spatial distribution as it follows the folded shape of the
deposit. Assumptions used in the resource include the following
metal prices: gold price of $1,400
(U.S.) per ounce (oz) and silver price of $22 (U.S.) per oz. The resource assumed the
following economic assumptions: recovery of 60.4 per cent at 0.2
g/t to 71.9 per cent at 1.6 g/t for gold, 25 per cent for silver,
$2.60-per-tonne mining costs,
64-cents-per-tonne general and
administrative costs, $4.20-per-tonne
milling costs and a pit slope of 45 degrees. The Company considers
the resource relevant due to its identification and modelling of
the Esperanza deposit.
The Company has not done sufficient work to classify the
resource as a current mineral resource or mineral reserves and the
Company is not treating the historical estimate as current mineral
resources or mineral reserves. Although the resource estimate is
considered reliable, the Company will resample a portion of the
drill core for the purpose of carrying out a new resource estimate.
Furthermore, additional data verification, including resurveying of
select diamond drill holes collars; review of graphic drill core
logs, comparison of these logs with remaining half-cut core and a
cross check of select geological logs agonist database entries; and
a check of original assay certificates against the assays and drill
hole database.
About Zacatecas Silver Corp.
The Zacatecas silver property
is located in Zacatecas state,
Mexico, within the highly
prospective Fresnillo silver belt,
which has produced over 6.2 billion ounces of silver. The company
holds 7,826 hectares (ha) (19,338 acres) of ground that is highly
prospective for low-sulphidation and intermediate-sulphidation
silver base metal mineralization and potentially low-sulphidation
gold-dominant mineralization. On Dec. 15,
2021, Zacatecas announced a
mineral resource estimate at the Panuco deposit consisting of 2.7 million
tonnes at 187 grams per tonne (g/t) silver equivalent (AgEq) (171
g/t silver (Ag) and 0.17 g/t gold (Au)) for 16.4 million ounces
AgEq (15 million ounces silver and 15,000 ounces gold).
The property is 25 kilometres (km) southeast of MAG Silver
Corp.'s Juanicipio mine and Fresnillo PLC's Fresnillo mine. The property shares common
boundaries with Pan American Silver Corp. claims and El Orito,
which is owned by Endeavour Silver. There are four main high-grade
silver target areas within the Zacatecas concessions: the Panuco deposit, Muleros, El Cristo and San
Manuel-San Gill. The property also includes El Oro, El Orito, La
Cantera, Monserrat, El
Penon, San Judas and
San Juan silver base metal vein
targets. These targets are relatively unexplored and will be the
focus of rapid reconnaissance.
On behalf of the Company,
Bryan Slusarchuk
Chief Executive Officer and Director
Forward-Looking Statements
Information set forth in this news release contains
forward-looking statements that are based on assumptions as of the
date of this news release. These statements reflect management's
current estimates, beliefs, intentions and expectations. They are
not guarantees of future performance. Zacatecas cautions that all forward looking
statements are inherently uncertain and that actual performance may
be affected by many material factors, many of which are beyond
their respective control. Such factors include, among other things:
the closing of the Proposed Transaction, risks and uncertainties
relating to Zacatecas's limited
operating history, its proposed exploration and development
activities on the Experanza Gold Project and its Zacatecas
Properties and the need to comply with environmental and
governmental regulations. Accordingly, actual and future
events, conditions and results may differ materially from the
estimates, beliefs, intentions and expectations expressed or
implied in the forward-looking information. Except as required
under applicable securities legislation, Zacatecas does not undertake to publicly
update or revise forward-looking information.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the Exchange)
accepts responsibility for the adequacy or accuracy of this
release.
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SOURCE Zacatecas Silver Corp.