Golden Minerals Signs New Lease Option Agreement With Hecla Mining
August 03 2017 - 6:45AM
Golden Minerals Company (“Golden Minerals”, “Golden” or “the
Company”) (NYSE American:AUMN) (TSX:AUMN) is pleased to announce it
has granted Hecla Mining Company (“Hecla”) an option to secure the
use of the Company’s oxide plant for an additional two years, for
(US) $2.0 million.
Under the terms of the new agreement dated
August 2, 2017, Hecla shall have the right to extend the existing
lease term for up to two years, ending no later than December 31,
2020, by providing Golden written notice no later than October 3,
2018. In consideration for such option, Hecla has paid Golden
Minerals $1.0 million cash, and shall purchase $1.0 million or
approximately 1.8 million shares of Golden Minerals common stock.
The shares will be issued within 30 days of signing and priced at
an undiscounted 30-day volume weighted average price of $0.55 as of
the day immediately preceding the signing date.
The fixed fees and volume related charges for
Hecla’s use of the oxide plant remain the same as under the
original lease. Hecla will have the right to terminate the lease
during the extension period for any reason with 120 days’
notice.
Golden leased its then-vacant oxide mill to
Minera Hecla S.A. de C.V., a wholly-owned subsidiary of Hecla
Mining Company, in July 2015 for an initial period of 18 months.
Hecla has exercised options to extend the lease several times since
2015, and prior to today’s agreement the lease was slated to run
through December 31, 2018.
Golden Minerals President and Chief Executive
Officer Warren M. Rehn commented, “We are very pleased to further
cement Golden’s strategic relationship with Hecla through the
extension of our lease agreement. Hecla’s investment in Golden
demonstrates confidence in our future. Extending this lease will
provide Golden with a steady stream of cash for the next three-plus
years, which allows us to continue efforts on other development and
exploration projects, including locating material to run through
the oxide mill after the lease with Hecla concludes.”
About Golden Minerals
Golden Minerals is a Delaware corporation based
in Golden, Colorado. The Company is primarily focused on acquiring
and advancing mining properties in Mexico with emphasis on areas
near its Velardena processing plants.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended and Section 21E of the Securities Exchange Act
of 1934, as amended, and applicable Canadian securities
legislation, including statements relating to expectations
regarding Hecla’s purchase of shares of our common stock and
expectations regarding our cash outlook. These statements are
subject to risks and uncertainties, including delayed listing
approval, lower than anticipated revenue from the oxide plant lease
as a result of delays or problems at Hecla’s mine or the oxide
plant or earlier than expected termination of the lease,
fluctuations in silver and gold metal prices, increases in costs
and declines in general economic conditions, and changes in
political conditions, in tax, royalty, environmental and other laws
in Mexico, and financial market conditions. Golden Minerals assumes
no obligation to update this information. Additional risks relating
to Golden Minerals may be found in the periodic and current reports
filed with the Securities and Exchange Commission by Golden
Minerals, including the Company’s Annual Report on Form 10-K for
the year ended December 31, 2016.
For additional information please visit http://www.goldenminerals.com/ or contact:
Golden Minerals Company
Karen Winkler
Director of Investor Relations
(303) 839-5060
Investor.relations@goldenminerals.com
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