Excellon Announces up to C$10 Million Non-Brokered Private Placement of Subscription Receipts
www.excellonresources.com
EXCELLON ANNOUNCES UP TO C$10 MILLION NON-BROKERED
PRIVATE PLACEMENT OF SUBSCRIPTION RECEIPTS
Not for distribution to United States news wire services or for dissemination in the United States
Toronto, Ontario – April 13, 2023 – Excellon Resources Inc. (TSX:EXN , OTCQB:EXNRF and FRA:E4X2)
(“Excellon” or the “Company”) is pleased to announce a non -brokered private placement of up to
28,571,428 subscription receipts of the Company (the “Subscription Receipts”) at a price of C$0.35 per
Subscription Receipt (the “Offering Price ”) for aggregate gross proceeds to the Company of up to
approximately C$10,000,000 (the “Offering”).
Following completion of the Company’s previously announced acquisition (the “Acquisition”)1 of the
issued and outstanding shares of Minera La Negra, S.A. de C.V., the owner of the permitted, past -
producing La Negra mine (“La Negra ”) located in Querétaro State, Mexico , t he net proceeds of the
Offering are expected to be used to advance development of La Negra, fund exploration at La Negra and
for general corporate purposes.
Acquisition Summary1:
• Excellon entered into a definitive agreement with Dalu S.à.r.l., an entity controlled by Orion Resource
Partners, (the “Seller”) to acquire La Negra for up to US$50 million2.
• Upfront consideration totaling US$20 million in common shares in the capital of the Company
(“Common Shares”) at a price of C$0.48 per Common Share.
• Up to US$30 million in deferred consideration payments after declaration of commercial production
at La Negra, at the Company’s option payable in cash or Common Shares.
• The Company and the Seller have agreed to extend the timeline to complete the Acquisition to no
later than June 15, 2023.3
La Negra Project1:
• Fully permitted, past producing mine with established infrastructure and historical payable
production averaging +3.0 million silver-equivalent (“AgEq”) ounces (“oz”) annually.
• Indicated Mineral Resources of approximately 15.1 million oz AgEq at 191 g/t AgEq and Inferred
Mineral Resources of approximately 41.8 million AgEq oz at 202 g/t AgEq.
• Completed Preliminary Economic Assessment (“ PEA”) demonstrates a post -tax NPV 5% of US$132.4
million.
• Estimated restart capital of US$20.9 million based on the PEA.
1 For further details on the Acquisition and La Negra (including the PEA and mineral resources) refer to Excellon’s news release dated January 9,
2023 and the technical report entitled “Technical Report – Preliminary Economic Assessment Study, La Negra Mine, Minera La Negra S.A. de C.V.,
Caderyta de Montes (Maconi), Querétaro, Mexico” dated June 29, 2022 with an effective date of March 31, 2022 (the “ La Negra Technical
Report”) available under Excellon’s profile on SEDAR (www.sedar.com) and on the Company’s website (www.excellonresources.com), as well as
the Cautionary Statements at the end of this news release.
2 As previously disclosed in Excellon’s news release dated January 9, 2023, 60% of the purchase consideration will be paid to the Seller for all of
its shares of the holding company of La Negra and 40% will be paid to Grupo Desarrollador Migo, S.A.P.I. de C.V. for the termination of existing
joint venture arrangements regarding La Negra.
3 As previously disclosed in the “Corporate Update” section of Excellon’s news release dated April 3, 2023 announcing the Company’s financial
and operating results for the fiscal year ended December 31, 2022, the Company was in discussions with the Seller regarding an extension of the
timeline to complete the Acquisition to no later than the end of June 2023 (as opposed to the April 2023 target dates announced on January 9,
2023). Copies of such prior news releases are available under Excellon’s profile on SEDAR and on Excellon’s website.
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• Target annual payable production of +3.0 million oz AgEq annually at a n estimated cash cost of
US$12.95 per AgEq oz.
• Polymetallic production mix: 43% Ag, 26% Zn, 23% Cu, 7% Pb by NSR contribution.
• Near-term restart of La Negra: 12-18 month development plan de-risking mine restart.
The Subscription Receipts will be created and issued pursuant to the terms of a subscription receipt
agreement (the “Subscription Receipt Agreement”) between a third party escrow agent, as subscription
receipt agent (the “Subscription Receipt Agent”), and the Company. Each Subscription Receipt will entitle
the holder thereof to receive, for no additional consideration and without further action on the part of
the holder thereof, one unit of the Company comprised of one Common Share and one Common Share
purchase warrant of the Company (a “Warrant”), subject to adjustment in certain events, upon the
satisfaction or waiver of the Escrow Release Conditions (as defined in the Subscription Receipt
Agreement), including the satisfaction of all conditions precedent to the completion of the Acquisition, at
or before 5:00 p.m. (Toronto time) on the Escrow Release Deadline (as defined in the Subscription Receipt
Agreement). Each Warrant will entitle the holder thereof to acquire one Common Share at a price of
C$0.55 per Common Share for a period of 24 months from the closing date of the Offering, subject to
adjustment in certain events.
In connection with the Offering, provided the Escrow Release Conditions are satisfied, certain arm’s -
length parties may receive a cash finder’s fee payment and/or warrants to purchase Common Shares in
consideration of Subscription Receipts that are sold to subscribers introduced by such parties.
Upon closing of the Offering, the aggregat e gross proceeds of the Offering will be deposited in escrow
with the Subscription Receipt Agent pending satisfaction or waiver of the Escrow Release Conditions, in
accordance with the provisions of the Subscription Receipt Agreement. Unless the requisite approval is
obtained pursuant to and in accordance with the terms of the Subscription Receipt Agreement, if the
Escrow Release Conditions are not satisfied at or before the Escrow Release Deadline, e ach of the then
issued and outstanding Subscription Receipts will be cancelled and the Subscription Receipt Agent will
return to each holder of Subscription Receipts an amount equal to the aggregate Offering Price of the
Subscription Receipts held by such holder plus an amount equal to the holder ’s pro rata share of any
interest or other income earned on the escrowed funds (less applicable withholding tax, if any). To the
extent that the escrowed funds are insufficient to refund such amounts to each holder of the Subscription
Receipts, the Company shall be liable for and will contribute such amounts as are necessary to satisfy the
shortfall.
The Offering is expected to close on or about May 4, 2023 and is subject to certain conditions including,
but not limited to, the receipt of all necessary approvals, including the approval of the Toronto Stock
Exchange.
The Subscription Receipts will be offered: (a) by way of private placement in each of the provinces of
Canada pursuant to applicable exemptions from the prospectus requirements under applicable Canadian
securities laws; (b) in the United States or to, or for the account or benefit of , U.S. persons, by way of
private placement pursuant to the exemptions from the registration requirements provided for under the
United States Securities Act of 1933, as amended (the “U.S. Securities Act”); and (c) in jurisdictions outside
of Canada and the United States on a private placement or equivalent basis. The securities to be is sued
pursuant to the Offering will be subject to a four -month hold period in Canada pursuant to applicable
Canadian securities laws.
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The securities offered have not been, nor will they be, registered under the U.S. Securities Act , or any
state securities law, and may not be offered or sold in the United States or to, or for the account or benefit
of, U.S. persons absent registration or an exemption from such registration requirements. This news
release shall not constitute an offer to sell or th e solicitation of an offer to buy in the United States nor
shall there be any sale of the securities in any state in which such offer, solicitation or sale would be
unlawful.
About Excellon
Excellon’s vision is to realize opportunities through the acquisition of advanced development or producing
assets with further potential to gain from an experienced operational management team for the benefit
of our employees, communities and shareholders. The Company is advancing a portfolio of silver, base
metals and precious metals assets including Kilgore, an advanced gold exploration project in Idaho; and
Silver City, a high-grade epithermal silver district in Saxony, Germany with 750 years of mining history and
no modern exploration. The Company has also entered into an agreement to acquire La Negra, a past -
producing Ag-Zn-Cu-Pb mine with exploration potential, located in Mexico.
Additional details on Excellon’s properties are available at www.excellonresources.com.
For Further Information, Please Contact:
Excellon Resources Inc.
Shawn Howarth, President & Chief Executive Officer
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
All statements, other than statements of historical fact, contained , referenced or incorporated by reference in this
news release constitute “forward-looking statements ” and “forward looking information ” (collectively, “forward-
looking statements”) within the meaning of applicable Canadian and United States securities legislation. Generally,
these forward-looking statements can be identified by the use of forward -looking terminology such as: “advance”,
“deferred”, “de -risking”, “development”, “expected”, “exploration”, “following”, “further”, “later”, “near-term”,
“opportunities”, “option”, “payable”, “plan”, “potential”, “preliminary”, “restart”, “subject to”, “target”, “upon”, and
“vision”, or variations of such words, and similar such words, expressions or statements that certain actions, events
or results can, could, may, should, will (or not) be achieved, occur, provide, result or support in the future or which,
by their nature, refer to future events. In some cases, forward-looking information may be stated in the present tense,
such as in respect of current matters that may be continuing, or that may have a future impact or effect. Forward-
looking statements include statements regarding the structure and terms of the Offering; the use of proceeds of the
Offering the timing and ability of the Company to close the Offering ; any finder’s fee payments, in cash or warrants
to purchase Common Shares; the timing and ability of the Company to receive necessary approvals ; the timing and
ability of the Company to close the Acquisition (including timing thereof) ; the restart of mining operations and/or
commercial production at La Negra (including strategy, plans, critical work streams, development activities and
resulting further analysis, timing, costs, capital requirements, permitting, achieving commercial production , mine
plan, production); exploration at La Negra; the La Negra PEA including any financial and/or economic metrics and
other results or conclusions or recommendations thereof (including restart recommendation and the following which
are all estimates only: AgEq oz, cash costs and capital costs, production, NPV, and NSR contribution); and Excellon’s
vision. Although the Company believes that such statements are reasonable, it can give no assurance that such
expectations will prove to be correct, and any for ward-looking statements by the Company are not guarantees of
future actions, results or performance. Forward -looking statements are based on assumptions, estimates,
expectations and opinions, which are considered reasonable and represent best judgment base d on available facts,
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as of the date such statements are made. If such assumptions, estimates, expectations and opinions prove to be
incorrect, actual and future results may be materially different than expressed or implied in the forward -looking
statements. Forward-looking statements are inherently subject to known and unknown risks, uncertainties,
contingencies and other factors which may cause the actual results or performance of the Company to be materially
different from any future results or performance expressed or implied by the forward-looking statements. Such risks,
uncertainties, contingencies and other factors include, among others, the “Risk Factors” in the Company’s annual
information form dated March 31, 2023 (the “2023 AIF”), and the risks, uncertainties, contingencies and other factors
identified in this news release, the Company’s Management’s Discussion and Analysis, and accompanying financial
statements, for the year ended December 31, 2022 (collectively, the “FYE 2022 Financial Disclosure”), the La Negra
Technical Report, the Excellon news releases referenced in this news release, and the Company ’s other applicable
public disclosure (collectively, “ Company Disclosure”). The foregoing list of risks, uncertainties, contingencies and
other factors is not exhaustive; readers should consult the more complete discussion of the Company ’s busin ess,
financial condition and prospects that is provided in the 2023 AIF and the other aforementioned Company Disclosure.
The forward -looking statements referenced or contained in this news release are expressly qualified by these
Cautionary Statements as well as the Cautionary Statements in the FYE 2022 Financial Disclosure, the 202 3 AIF and
the other referenced Company Disclosure. Forward-looking statements contained herein are made as of the date of
this news release (or as otherwise expressly specified) and the Company disclaims any obligation to update any
forward-looking statements, whether as a result of new information, future events or results or otherwise, except as
required by applicable laws.
Mineral Resources
Until mineral deposits are actually mined and processed, mineral resources must be considered as estimates only.
Mineral resource estimates that are not classified as mineral reserves do not have demonstrated economic viability.
The estimation of mineral resources is inherently uncertain, involves subjective judgement about many relevant
factors and may be materially affected by, among other things, environmental, permitting, legal, title, taxation,
socio-political, mar keting, or other relevant risks, uncertainties, contingencies and other factors described in the
foregoing Cautionary Statements on Forward -Looking Statements. The quantity and grade of reported “inferred”
mineral resource estimates are uncertain in nature and there has been insufficient exploration to define “inferred”
mineral resource estimates as an “indicated” or “measured” mineral resource and it is uncertain if further exploration
will result in upgrading “inferred” mineral resource estimates to an “i ndicated” or “measured” mineral resource
category. The accuracy of any mineral resource estimates is a function of the quantity and quality of available data,
and of the assumptions made and judgments used in engineering and geological interpretation, whic h may prove to
be unreliable and depend, to a certain extent, upon the analysis of drilling results and statistical inferences that may
ultimately prove to be inaccurate. The quantity and grade of “inferred” mineral resource estimates are uncertain in
nature and there has been insufficient exploration to define “inferred” mineral resource estimates as an “indicated”
or “measured” mineral resource and it is uncertain if further exploration will result in upgrading “inferred” mineral
resource estimates to an “indicated” or “measured” mineral resource category. Mineral resource estimates may have
to be re -estimated based on, among other things: (i) fluctuations in mineral prices; (ii) results of drilling and
development; (iii) results of geological and structur al modeling including stope design; (iv) metallurgical testing and
other testing; (v) proposed mining operations including dilution; and (vi) the possible failure to receive and/or
maintain required permits, licenses and other approvals. It cannot be assum ed that all or any part of a “inferred”,
“indicated” or “measured” mineral resource estimate will ever be upgraded to a higher category including a mineral
reserve.
Mineral resource estimates disclosed by the Company were estimated and reported in accordance with National
Instrument 43 -101 of the Canadian Securities Administrators (“ NI 43 -101”) using Canadian Institute of Mining,
Metallurgy and Petroleum (“ CIM”) Definition Standards for Mineral Resources and Mineral Reserves (the “ CIM
Standards”), which govern the public disclosure of scientific and technical information concerning mineral projects
by Canadian issuers such as Excellon, and applying the CIM’s Mineral Resources and Mineral Reserves Best Practices
guidelines (as applicable). For additional discussion of the Company’s mineral resource estimates at La Negra, as well
as an overall more detailed discussion of such project, the reader should refer to the 2023 AIF and the La Negra
Technical Report.
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U.S. Readers
The terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral
resource” as disclosed by the Company are Canadian mining terms defined in the CIM Standards (collectively, the
“CIM Definitions ”) in accordance with NI 43 -101. NI 4 3-101 establishes standards for all public disclosure that a
Canadian issuer makes of scientific and technical information concerning mineral projects. These Canadian standards
differ from the requirements of the SEC applicable to United States domestic and certain foreign reporting companies
under Subpart 1300 of Regulation S -K (“S-K 1300”). Accordingly, information describing mineral resource estimates
for the Company’s projects and La Negra, may not be comparable to similar information publicly reported in
accordance with the applicable requirements of the SEC, and so there can be no assurance that any mineral resource
estimate for the Company’s projects or La Negra would be the same had the estimates been prepared per the SEC’s
reporting and disclosure r equirements under applicable United States federal securities laws, and the rules and
regulations thereunder, including but not limited to S-K 1300. Further, there is no assurance that any mineral resource
or mineral reserve estimate that the Company may r eport under NI 43 -101 would be the same had the Company
prepared such estimates under S-K 1300.
Preliminary Economic Assessments (or PEAs)
A PEA, including the La Negra PEA, is only a conceptual study of the potential viability of the subject project’s mineral
resource estimates, and the economic and technical viability of the project and its estimated mineral resources has
not been demonstrated. A PEA is preliminary in nature and provides only an initial, high -level review of the subject
project’s potential and design options; there is no certainty that a PEA will be realized. The conceptual LOM plan and
economic model in a PEA include numerous assumptions and mineral resource estimates including inferred mineral
resource estimates. Inferred mineral resource estimates are considered to be too speculative geologically to have any
economic considerations applied to such estimates. Under NI 43 -101, estimates of inferred mineral resources may
not form the basis of feasibility studies, pre -feasibility studies or other economic studies, except in prescribed cases,
such as in a preliminary economic assessment under certain circumstances. There is no guarantee that inferred
mineral resource estimates will be converted to indicated or measured mineral resources, or th at indicated or
measured mineral resources can be converted to mineral reserves. Mineral resources that are not mineral reserves
do not have demonstrated economic viability, and as such there is no guarantee the economics described in any PEA,
including th e La Negra PEA, will be achieved. Mineral resource estimates may be materially affected by
environmental, permitting, legal, title, taxation, socio -political, marketing, or other relevant risks, uncertainties and
other factors, as more particularly described in the foregoing other Cautionary Statements of this news release.
Qualified Persons
Mr. Paul Keller, P. Eng., Chief Operating Officer of the Company and a Qualified Person as defined in NI 43‐101 (a
“QP”), reviewed, verified and approved the scientific and technical information relating to operations and production
results contained in this news release. Mr. Jorge Ortega, M.Sc., P.Geo., Vice President Exploration of the Company
and a QP, reviewed, verified and approved the scientific and technical info rmation relating to geological
interpretation and results contained in this news release.