Corporate Update

Guanajuato Silver Company Ltd.

29 November 2023

 

Guanajuato Silver Company Limited

Guanajuato Silver Provides Corporate Update

~Appointment of Chief Operating Officer~

~~Elimination of US$2,000,000 in Contingent Payments~~

Guanajuato Silver Company Ltd. (the "Company" or "GSilver") (TSXV:GSVR)(OTCQX:GSVRF) is pleased to provide a corporate update highlighted by the appointment of Carlos A. Silva as Chief Operating Officer ("COO").

Appointment of COO

With a career spanning over 35 years, Mr. Silva has proven serially successful at advancing, expanding, and managing mining operations within Mexico & Bolivia. Like many of GSilver's employees, Mr. Silva is a graduate of mine engineering from the University of Guanajuato; he holds an MBA from ITESM, and he is a graduate of IPADE Business School. After an initial career of continually taking roles of greater responsibility overseeing different types of deposits such as gypsum, manganese, gold, silver and polymetallic deposits, notably with the La Fortuna mine in Sinaloa, and the San Dimas mine in Durango, he began working with Trafigura in 2007, where he expanded the Zimapan mine project in the state of Hidalgo. Mr. Silva co-founded Carrizal Mining in 2009, where he led the re-start and expansion of the Zimapan mine. In 2017 he joined Santacruz Silver Mining Ltd., first as COO, and then as CEO, vending his company Carrizal Mining into Santacruz Silver in the process. Mr. Silva left Santacruz Silver in August of this year, having helped that company expand its production profile from just 815,000 silver-equivalent ounces in 2018 to 19,600,000 ounces of silver-equivalent production in 2022. Mr. Silva replaces Mario Valdez Bustillos, who was promoted from VP Operations to Co-Chief Operating Officer in April, 2023.

Commenting on this appointment, James Anderson, Chairman and CEO said, "We are building one of the best mine operating teams in Mexico - and the addition of Carlos makes us one giant step better. Carlos is the ideal candidate to secure and expand upon the significant progress we have made over the past 12-months; he brings a wealth of experience not just in terms of underground mining operations, but also in terms of his demonstrated entrepreneurial insight, which will serve Guanajuato Silver well as we enter our next phase of growth."

Agreement with Great Panther Trustee to Terminate Contingency Payments

The Company has signed an agreement (the "Agreement") with the court appointed insolvency trustee of the Great Panther Estate (the "Trustee") to terminate all obligations of the Company to make contingency payments totalling US$2 million in exchange for the offset of a working capital adjustment receivable owed to the Company by Great Panther. In August, 2022, GSilver closed the purchase of Great Panther Mining Ltd.'s ("Great Panther") Mexican subsidiary Minera Mexicana Rosario S.A. de C.V. ("MMR"), which owned the Topia mine in the state of Durango, Mexico ("Topia"), the San Ignacio mine ("San Ignacio") and the Valenciana Mine Complex ("VMC") in Guanajuato, Mexico (the "MMR Acquisition"), (See Guanajuato Silver news release dated August 4, 2022 - "GSilver Closes Acquisition of Great Panther's Mexican Mining Assets"). At that time, the MMR Acquisition included three contingency payments due from GSilver to Great Panther, specifically:

·      US$500,000 upon GSilver producing 2,500,000 ounces of silver from the purchased MMR assets.

·      US$750,000 if the price of silver closes at or above US$27.50 per ounce for 30 consecutive days within two years after closing.

·      US$750,000 if the price of silver closes at or above US$30.00 per ounce for 30 consecutive days within three years after closing.

On December 16, 2022, Great Panther made a voluntary assignment into bankruptcy under the Bankruptcy and Insolvency Act of Canada, and the licensed insolvency Trustee was appointed by the Supreme Court of British Columbia. The Agreement to terminate the obligation to make contingency payments is necessary to allow the Trustee to complete the insolvency process and provides a substantial benefit to GSilver through the elimination of these obligations.

Stock Options and Restricted Shares Grant

The Company announces the granting of stock options and restricted share units (RSUs) to an officer under the Company's stock option plan and omnibus equity compensation plan, respectively.

The Company has granted stock options under its stock option plan to purchase up to an aggregate of 750,000 common shares of the Company. The stock options will be exercisable for a term of five years at a price per share equal to today's closing price of the Company's common shares on the TSX Venture Exchange, subject to vesting on the basis of one-third on the date of grant, one third after 12 months and one-third after 24 months.

In addition, the Company has granted an aggregate of up to 230,000 RSU's vesting after 12 months. Each RSU entitles the holder to receive, upon vesting, one common share of the Company.

For further information regarding Guanajuato Silver Company Ltd., please contact:

JJ Jennex, Gerente de Comunicaciones, T: 604 723 1433

E: [e-mail]

Gsilver.com

VSA Capital - AQSE Corporate Adviser

T: [phone]

Simon Barton - Corporate Finance

Thomas Jackson - Corporate Finance

Andrew Monk - Corporate Broking

David Scriven - Corporate Broking

About Guanajuato Silver

GSilver is a precious metals producer engaged in reactivating past producing silver and gold mines in central Mexico. The Company produces silver and gold concentrates from the El Cubo Mine Complex, Valenciana Mines Complex, and the San Ignacio mine; all three mines are located within the state of Guanajuato, which has an established 480-year mining history. In addition, the Company produces silver, gold, lead, and zinc concentrates from the Topia mine in northwestern Durango. With four operating mines and three processing facilities, Guanajuato Silver is one of the fastest growing silver producers in Mexico. 

 

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