(VZLA-TSX-V)
VANCOUVER, BC, July 21, 2021 /CNW/ - Vizsla Silver
Corp. (TSXV: VZLA) (OTCQB: VIZSF) (Frankfurt: 0G3) ("Vizsla" or the
"Company") is pleased to announce that it has signed a
binding amending agreement (the "Panuco Amending
Agreement") with Minera Rio Panuco SA de CV ("Minera Rio Panuco") and has executed a
binding option exercise notice ("Copala Exercise Notice") with
Silverstone Resources S.A de CV ("Silverstone"), which
together will constitute the acceleration and exercise of the
Company's option to acquire 100% of the Panuco-Copala silver-gold district ("Panuco
District" or the "Project") located in Sinaloa, Mexico.
Panuco Amending Agreement
Under the Amending Agreement, Vizsla and Minera Rio Panuco have agreed to amend the terms
of the original Panuco option agreement in order to accelerate the
Company's exercise of its option on the Panuco property (the
"Panuco Property"). Upon closing of the transactions
contemplated by the Panuco Amending Agreement, Vizsla will acquire
a 100% ownership interest in the Panuco Property (comprising 43
mining concessions with a combined surface area of 3,839 Ha) and
the "El Coco" mill (the "Mill") in consideration for:
- A cash payment of US$4,250,000
payable to Minera Rio Panuco upon
signing of the Amending Agreement;
- The issuance to Minera Rio
Panuco of 6,245,902 common shares of Vizsla priced at
C$2.44 per share (for a total value
of US$12,000,000) upon the completion
of the transfer of the Panuco Property on or before August 10, 2021; and
- A cash payment of US$6,100,000 on
or before February 1, 2022, following
the refurbishment and transfer of ownership of the Mill which is to
occur on or before December 31,
2021.
The mineral concessions comprising the Panuco Property include
the Napoleon vein corridor – which has seen the majority of
Vizsla's exploration – and are unencumbered by royalties.
Copala Exercise Notice
Under the Copala Exercise Notice, Vizsla and Silverstone have
agreed to amend the terms of the original Copala option agreement in order to accelerate
the Company's exercise of its option on the Copala property (the "Copala
Property"). A definitive agreement in respect of such
amendments is expected to be signed on or before August 3, 2021 (the "Copala Amending
Agreement" and, together with the Panuco Amending Agreement,
the "Amending Agreements"). Upon closing of the transactions
contemplated by the Copala Amending Agreement, Vizsla will acquire
a 100% ownership interest in the Copala Property (comprising 64
mining concessions with a combined surface area of 5,547 Ha) in
consideration for:
- A cash payment of US$9,607,212.50
payable to Silverstone upon the completion of the transfer of the
Copala Property on or before August 3,
2021; and
- The issuance to Silverstone of 5,000,475 common shares of
Vizsla priced at C$2.44 per share
(for a total value of US$9,607,212.50) upon the completion of the
transfer of the Copala Property.
Table 1: Summary of Amending Agreements1
Vizsla President and CEO, Michael
Konnert, commented: "The acceleration of the options and
taking full ownership of the entire district within 20 months of
signing is a major achievement for Vizsla Silver and speaks to our
confidence in the Panuco District. The option exercise pursuant to
these terms allows us to preserve approximately C$27,000,000 in cash which we intend to utilize
in the most value accretive activities for the Company. In
addition, the new structure shows the strong belief the vendors
have in the potential of this asset. We are excited to welcome them
as shareholders, take full control of the property and look forward
to unlocking its full potential."
All common shares issued pursuant to the Amending Agreements
will subject to a 4-month statutory hold period in applicable with
Canadian securities laws. The Amending Agreements are subject to
approval of the TSX Venture Exchange. Closing of the transactions
contemplated by the Amending Agreements is expected to be finalized
after such approval is obtained.
After the execution of the Amending Agreements, Vizsla will
continue to be well-funded with over $57,000,000 in the bank and ten drill rigs
currently operating on the Project.
About the Panuco project
Upon completion of the transactions contemplated by the Amending
Agreements, Vizsla will own 100% of the 9,386.5-hectare Panuco
district in southern Sinaloa,
Mexico, near the city of Mazatlán. The project comprises of
over 75 kilometres of total vein extent, a 500 ton per day mill, 35
kilometres of underground mines, tailings facilities, roads, power
and permits.
The district contains intermediate to low sulfidation epithermal
silver and gold deposits related to siliceous volcanism and crustal
extension in the Oligocene and Miocene. Host rocks are mainly
continental volcanic rocks correlated to the Tarahumara
Formation.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
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1 FX
Rate CAD USD: $1.27
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SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This news release includes certain "Forward–Looking Statements"
within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and "forward–looking information"
under applicable Canadian securities laws. When used in this news
release, the words "anticipate", "believe", "estimate", "expect",
"target", "plan", "forecast", "may", "would", "could", "schedule"
and similar words or expressions, identify forward–looking
statements or information. These forward–looking statements or
information relate to, among other things: the acceleration and
exercise of the Company's option to acquire 100% of the Panuco
District, the execution of the Copala Amending Agreement, and
future mineral exploration, development and production at the
Pancuo District.
Forward–looking statements and forward–looking information
relating to any future mineral production, liquidity, enhanced
value and capital markets profile of Vizsla, future growth
potential for Vizsla and its business, and future exploration plans
are based on management's reasonable assumptions, estimates,
expectations, analyses and opinions, which are based on
management's experience and perception of trends, current
conditions and expected developments, and other factors that
management believes are relevant and reasonable in the
circumstances, but which may prove to be incorrect. Assumptions
have been made regarding, among other things, the price of silver,
gold and other metals; no escalation in the severity of the
COVID-19 pandemic; costs of exploration and development; the
estimated costs of development of exploration projects; Vizsla's
ability to operate in a safe and effective manner and its ability
to obtain financing on reasonable terms.
These statements reflect Vizsla's respective current views with
respect to future events and are necessarily based upon a number of
other assumptions and estimates that, while considered reasonable
by management, are inherently subject to significant business,
economic, competitive, political and social uncertainties and
contingencies. Many factors, both known and unknown, could cause
actual results, performance or achievements to be materially
different from the results, performance or achievements that are or
may be expressed or implied by such forward–looking statements or
forward-looking information and Vizsla has made assumptions and
estimates based on or related to many of these factors. Such
factors include, without limitation: the Company's dependence on
one mineral project; precious metals price volatility; risks
associated with the conduct of the Company's mining activities in
Mexico; regulatory, consent or
permitting delays; risks relating to reliance on the Company's
management team and outside contractors; risks regarding mineral
resources and reserves; the Company's inability to obtain insurance
to cover all risks, on a commercially reasonable basis or at all;
currency fluctuations; risks regarding the failure to generate
sufficient cash flow from operations; risks relating to project
financing and equity issuances; risks and unknowns inherent in all
mining projects, including the inaccuracy of reserves and
resources, metallurgical recoveries and capital and operating costs
of such projects; contests over title to properties, particularly
title to undeveloped properties; laws and regulations governing the
environment, health and safety; the ability of the communities in
which the Company operates to manage and cope with the implications
of COVID-19; the economic and financial implications of COVID-19 to
the Company; operating or technical difficulties in connection with
mining or development activities; employee relations, labour unrest
or unavailability; the Company's interactions with surrounding
communities and artisanal miners; the Company's ability to
successfully integrate acquired assets; the speculative nature of
exploration and development, including the risks of diminishing
quantities or grades of reserves; stock market volatility;
conflicts of interest among certain directors and officers; lack of
liquidity for shareholders of the Company; litigation risk; and the
factors identified under the caption "Risk Factors" in Vizsla's
management discussion and analysis. Readers are cautioned against
attributing undue certainty to forward–looking statements or
forward-looking information. Although Vizsla has attempted to
identify important factors that could cause actual results to
differ materially, there may be other factors that cause results
not to be anticipated, estimated or intended. Vizsla does not
intend, and does not assume any obligation, to update these
forward–looking statements or forward-looking information to
reflect changes in assumptions or changes in circumstances or any
other events affecting such statements or information, other than
as required by applicable law.
SOURCE Vizsla Silver Corp.