TORONTO, Dec. 23, 2014 /CNW/ - Scorpio Mining
Corporation ("Scorpio Mining") (TSX: SPM)(OTCQX: SMNPF) and U.S.
Silver & Gold Inc. ("U.S. Silver & Gold") (TSX:
USA)(OTCQX: USGIF) are pleased to
announce the completion of their previously announced merger of
equals to combine their respective businesses by way of a plan of
arrangement of U.S. Silver & Gold pursuant to section 182 of
the Business Corporations Act (Ontario) (the "Transaction"). The
Transaction was approved at special meetings of the shareholders of
U.S. Silver & Gold and Scorpio Mining, respectively, on
December 18, 2014. Final court
approval was obtained from the Ontario Superior Court of Justice on
December 22, 2014.
Pursuant to the Transaction, (i) each outstanding common share
of U.S. Silver & Gold was exchanged for 1.68 common shares of
Scorpio Mining (the "Exchange Ratio"), (ii) the outstanding
options of U.S. Silver & Gold were exchanged for options to
purchase common shares of Scorpio Mining based on the Exchange
Ratio and (iii) the outstanding restricted share units of U.S.
Silver & Gold were adjusted based on the Exchange Ratio with
future cash pay-outs to be based on the trading price of the common
shares of Scorpio Mining. As of the effective time of the
Transaction, the outstanding warrants of U.S. Silver & Gold, in
accordance with their terms, are exercisable for common shares of
Scorpio Mining based on the Exchange Ratio.
The combined company will continue under the name of Scorpio
Mining Corporation and continue to be listed on TSX under the
symbol "SPM". The common shares of Scorpio Mining also
commenced trading on the OTCQX today under the symbol
"SMNPF". As a result of the Transaction, the common shares of
U.S. Silver & Gold will be delisted from the TSX and withdrawn
from the OTCQX. U.S. Silver & Gold intends to apply to
the relevant securities regulatory authorities so that it can cease
to be a reporting issuer in the applicable jurisdictions.
For U.S. Silver & Gold shareholders who held their shares
through a broker, the delivery of the share consideration under the
Transaction will be processed through their broker. For U.S.
Silver & Gold shareholders who held their shares in registered
form, the share consideration will be processed after they deposit
their share certificates with Equity Financial Trust Company
("Equity"), the depositary for U.S. Silver & Gold, in
accordance with the instructions in the Letter of Transmittal
previously sent. Any questions regarding delivery of the
share consideration in connection with the Transaction should be
directed to Equity, via telephone at 1-866-393-4891 x205 (toll free
in North America) or 416-361-0930
x205 or via email at TMXEInvestorServices@tmx.com.
Shareholders of Scorpio Mining do not need to exchange their shares
in connection with the Transaction.
About Scorpio Mining Corporation
Scorpio Mining
Corporation is a Canadian-based silver producer with significant
base metal by-product credits. The 100% owned Nuestra Señora Mine
in the Cosalá District of Sinaloa State, Mexico, has flexible mining methods and
diversified metal production. It has a fully mechanized underground
operation and a processing facility permitted for expansion to
4,000 tonnes per day. The plant produces zinc, copper and lead
concentrates - two of which contain a significant silver component
that contributes ~50% of the revenue from metal payable. Scorpio
Mining's opportunity for growth lies within the Cosalá District,
where Scorpio controls approximately 24,000 hectares covering
multiple exploration targets, advanced deposits and historically
producing mines. Scorpio Mining continues to focus on internal
growth through development of its deposits and aggressive
exploration programs.
About U.S. Silver & Gold Inc.
U.S. Silver &
Gold Inc. is a silver and gold mining company focused on profitable
production from its existing asset base and execution of targeted
accretive acquisitions. It owns and operates the Galena Mine
Complex in the heart of the Silver
Valley/Coeur d'Alene Mining District, Shoshone County, Idaho, which produces
high-grade silver and is the second most prolific silver mine in
U.S. history, delivering over 250 million ounces to date. U.S.
Silver & Gold also owns the Drumlummon Mine Complex in
Lewis and Clark County,
Montana.
Cautionary Statement on Forward-Looking
Information
This news release contains "forward-looking
information" within the meaning of applicable securities laws.
Forward-looking information includes, but is not limited to,
expectations, intentions, plans, assumptions and beliefs with
respect to, among other things, the Transaction, the combined
company following completion of the Transaction and its operations,
and the assumption for the reduction of total resources at El Cajón
utilized by U.S. Silver & Gold for purposes of evaluating the
Transaction. Often, but not always, forward-looking information can
be identified by forward-looking words such as "anticipate",
"believe", "expect", "goal", "plan", "intend", "estimate", "may",
"assume" and "will" or similar words suggesting future outcomes, or
other expectations, beliefs, plans, objectives, assumptions,
intentions, or statements about future events or performance.
Forward-looking information is based on the opinions and estimates
of the applicable company as of the date such information is
provided and is subject to known and unknown risks, uncertainties,
and other factors that may cause the actual results, level of
activity, performance, or achievements of the applicable company to
be materially different from those expressed or implied by such
forward looking information. This includes the ability to develop
and operate the properties of the combined company, risks
associated with the mining industry such as economic factors
(including future commodity prices, currency fluctuations and
energy prices), failure of plant, equipment, processes and
transportation services to operate as anticipated, environmental
risks, government regulation, actual results of current exploration
activities, possible variations in ore grade or recovery rates,
permitting timelines, capital expenditures, reclamation activities,
social and political developments and other risks of the mining
industry. Although each of Scorpio Mining and U.S. Silver &
Gold has attempted to identify important factors that could cause
actual results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated, or intended. Readers
are cautioned not to place undue reliance on such information. By
its nature, forward-looking information involves numerous
assumptions, inherent risks and uncertainties, both general and
specific those contribute to the possibility that the predictions,
forecasts, and projections of various future events will not occur.
Each of Scorpio Mining and U.S. Silver & Gold undertakes no
obligation to update publicly or otherwise revise any
forward-looking information whether as a result of new information,
future events or other such factors which affect this information,
except as required by law. Readers are also cautioned that
the assumption for the reduction in total resources at El Cajón
utilized by U.S. Silver & Gold for purposes of evaluating the
Transaction is an assumption of U.S. Silver & Gold only, and is
not a statement of, or otherwise endorsed by, Scorpio Mining, and
the actual reduction in total resources at El Cajón may differ
materially from the assumption of U.S. Silver & Gold, including
because the concession boundaries underlying the El Cajón deposit
have not yet been confirmed by the Dirección General de Regulación
Minera and the technical work to determine resources based on such
confirmed boundaries has not yet been conducted. Scorpio
Mining intends to prepare an updated mineral resource estimate for
its El Cajón deposit and a revised technical report, prepared in
accordance with National Instrument 43-101 - Standards of
Disclosure for Mineral Projects, following the Dirección General de
Regulación Minera's final confirmation of the concession boundaries
underlying the El Cajón deposit.
SOURCE U.S. Silver & Gold Inc.