Fortuna Silver Mines Closes US$40 Million Bought Deal Financing of 4.65% Convertible Debentures
Fortuna Silver Mines Closes US$40 Million
Bought Deal Financing of 4.65% Convertible Debentures
Vancouver, October 2 , 2019 -- Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) (“Fortuna” or the
“Company”) is pleased to announce that it has completed its previously announced bought deal offering
(the “ Offering”) of senior subordinated unsecured convertible debentures (the “ Debentures”). The
Company issued an aggregate principal amount of US$40 million Debentures at a price of US$1,000 per
Debenture.
The Debentures mature on October 31, 2024 and will bear interest at a rate of 4.65% per annum,
payable semi-annually in arrears on the last business day of April and October in each year, commencing
on April 30, 2020. The Debentures will be convertible at the holder’s option into common shares in the
capital of the Company (“Common Shares”) at a conversion price of US$5.00 per share (the “Conversion
Price”), representing a conversion rate of 200 Common Shares per US$1,000 principal amount of
Debentures, subject to adjustment in certain circumstances.
Subject to certain exceptions in connection with a change of control of the Company, the Debentures
will not be redeemable by the Company prior to October 31, 2022. On or after October 31, 2022 and
prior to Octo ber 31, 2023, the Debentures may be redeemed in whole or in part from time to time at
the Company’s option at a price equal to their principal amount plus accrued and unpaid interest,
provided that the volume weighted average trading price of the Common Sh ares on the NYSE for the 20
consecutive trading days ending on the fifth trading day preceding the date on which the notice of the
redemption is given is at least 125% of the Conversion Price. On and after October 31, 2023, the
Debentures may be redeemed i n whole or in part from time to time at the Company’s option at a price
equal to their principal amount plus accrued and unpaid interest regardless of the trading price of the
Common Shares.
The Offering was conducted by a syndicate of underwriters co -led by CIBC Capital Markets and
Scotiabank, and including BMO Capital Markets (collectively, the “ Underwriters”). The Company has
also granted an over- allotment option to the Underwriters, entitling them to purchase, for a period of
30 days from the closing of the Offering, up to US$6 million principal amount of additional Debentures
at the offering price of US$1,000 per Debenture, to cover over-allotments, if any.
The Company will use the net proceeds from the Offering for working capital in relation to the start-up
of the Lindero project and for general working capital purposes.
The Debentures were offered for sale by way of a short form prospectus (the “ Prospectus”) in each of
the provinces of Canada, except Québec, and in the United States on a private placement basis pursuant
to an exe mption from the registration requirements of the United States Securities Act of 1933, as
amended (the “U.S. Securities Act”), and certain other jurisdictions.
-2-
This news release does not constitute an offer of securities for sale in the United States. The securities
have not been and will not be registered under the U.S. Securities Act, and may not be offered or sold in
the United States or to a U.S. person (as defined in Regulation S under the U.S. Securities Act) absent
registration or an applicable exemption from the registration requirements of the U.S. Securities Act.
About Fortuna Silver Mines Inc.
Fortuna is a growth oriented, precious metals producer focused on mining opportunities in Latin
America. The Company’s prim ary assets are the Caylloma sil ver mine in southern Peru, the San Jose
silver-gold mine in Mexico and the Lindero gold project, currently under construction, in Argentina. The
Company is selectively pursuing acquisition opportunities throughout the Ameri cas and in select other
areas. For more information, please visit our website at www.fortunasilver.com.
ON BEHALF OF THE BOARD
Jorge A. Ganoza
President, CEO and Director
Fortuna Silver Mines Inc.
Trading symbols: NYSE: FSM | TSX: FVI
Investor Relations:
Carlos Baca
T (Peru): +51.1.616.6060, ext. 0
The Toronto Stock Exchange and the New York Stock Exchange have not reviewed and do not accept responsibility
for the accuracy or adequacy of this news release, which has been prepared by management.
Forward Looking Statements
This news release contains forward looking statements which constitute “forward looking information” within the meaning of
applicable Canadian securities l egislation and “forward looking statements” within the meaning of the “safe harbor” provisions
of the Private Securities Litigation Reform Act of 1995 (collectively, “Forward looking Statements”). All statements included
herein, other than statements of hi storical fact, are Forward looki ng Statements and are subject to a variety of known and
unknown risks and uncertainties which could cause actual events or results to differ materially from those reflected in the
Forward looking Statements. The Forward looking Statements in this news rele ase include, without limitation, statements about
the anticipated use of its net proceeds and whether the over -allotment option will be exercised. Often, but not always, these
Forward looking Statements can be identified by t he use of words such as “estima ted”, “potential”, “open”, “future”,
“assumed”, “projected”, “used”, “detailed”, “has been”, “gain”, “planned”, “reflecting”, “will”, “containing”, “remaining”, “to
be”, or statements that events, “could” or “should” occur or be achieved and similar expressions, including negative variations.
Forward looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be material ly different from any results, performance or achievements
expressed or implied by the Forward looking Statements. Such uncertainties and factors include, among others, whether the
Company’s activities at its properties will proceed as planned; delays in c onstruction at the Lindero Proj ect; delays in
commissioning of the mine at Lindero; delays in the commencement of commercial production; changes in general economic
conditions and financial markets; changes in prices for silver, gold and other metals; tec hnological and operational hazar ds in
Fortuna’s mining and mine development activities; risks inherent in mineral exploration; uncertainties inherent in the estimation
of mineral reserves, mineral resources, and metal recoveries; governmental and other app rovals; political unrest or instability in
countries where Fortuna is active; labor relations issues; as well as those factors discussed under “Risk Factors” in the Company's
Annual Information Form. Although the Company has attempted to identify important factors that could cause actual actions,
-3-
events or results to differ materially from those described in Forward looking Statements, there may be other factors that cause
actions, events or results to differ from those anticipated, estimated or intended.
The Company believes that the as sumptions and expectations reflected in the forward looking information contained in this
news release are reasonable, but undue reliance should not be placed on them because the Company can give no assurance that
they will prove to be correct. Since state ments in respect of forward looking information address future events and conditions,
by their very nature they involve inherent risks and uncertainties. The forward looking information contained in this news
release is made as of the date hereof and the C ompany undertakes no obligation to update publicly or revise any forward
looking information, whether as a result of new information, future events or otherwise, unless so required by applicable
securities laws.