Endeavour Silver Corp. has announced that it has signed a binding letter agreement (agreement) to sell its El Cubo Mine and related assets to VanGold Mining Corp. for US$15 million in cash and share payments plus additional contingent payments (the transaction).
Bradford Cooke, CEO of Endeavour, commented: “We are pleased to enter into this transaction to sell our El Cubo assets to VanGold. They are an ideal fit given the proximity of the Pinguico property to the El Cubo plant. We will become VanGold’s largest shareholder and look forward to supporting the VanGold team as they advance the Pinguico and El Cubo assets through exploration and development to production.”
VanGold will pay US$15 million to Endeavour for the El Cubo assets as follows:
- US$0.5 million non-refundable cash down-payment.
- US$7 million cash on closing on or before 17 March 2021.
- US$5 million in VanGold common shares on closing – priced at CAN$0.30 per share for a total of 21 331 058 VanGold shares representing 16.1% of VanGold’s updated share capital.
- US$2.5 million unsecured promissory note due and payable within 12 months from closing.
Endeavour has agreed to abstain from voting its shares of VanGold, other than as recommended by VanGold’s management for a period of 2 years after closing and a 12-month restriction on the resale of any VanGold shares acquired in this transaction.
VanGold has also agreed to pay Endeavour up to an additional US$3 million in contingent payments based on the following events:
- US$1 million - upon VanGold producing 3 million silver equivalent oz from the El Cubo mill.
- US$1 million - if the price of gold closes at or above US$2000/oz for 20 consecutive days within 2 years after closing.
- US$1 million - if the price of gold closes at or above US$2200/oz for 20 consecutive days within 3 years after closing.
Closing of the transaction is subject to satisfaction of certain conditions including final due diligence by VanGold, financing and receipt of all requisite third party and regulatory approvals including the acceptance of the TSXV on or before 17 March 2021, failing which either VanGold or Endeavour may terminate the agreement.
Read the article online at: https://www.globalminingreview.com/finance-business/29122020/endeavour-silver-to-sell-el-cubo-mine-for-us15-million/