Metalla Announces Transformational Agreement to Acquire Royalty and Streaming Portfolio from Coeur Mining
METALLA ANNOUNCES TRANSFORMATIONAL AGREEMENT TO ACQUIRE
ROYALTY AND STREAMING PORTFOLIO FROM COEUR MINING
FOR IMMEDIATE RELEASE CSE: MTA
OTCQB: EXCFF
June 12, 2017
Frankfurt: X9CP
Toronto, Canada: Metalla Royalty & Streaming Ltd. (“Metalla” or the “ Company”) (CSE:MTA)
(OTCQB:EXCFF) (FRANKFURT:X9CP) is pleased to announce that it has entered into a Share and Asset
Purchase Agreement (“Agreement”) with Coeur Mining , Inc. (“Coeur Mining”) and certain subsidiaries of
Coeur Mining (collectively “Coeur”) pursuant to which Metalla will (the “Transaction”):
• acquire a portfolio of three (3) royalties and one (1) stream (the “Coeur Portfolio”); and
• pay to Coeur Mining consideration valued at USD$13,000,000 (the “Purchase Price”) consisting of:
o common shares of Metalla issued from treasury (the “ Consideration Shares ”) representing
approximately 19.9% of the pro -forma issued and outstanding Metalla common shares on a
non-diluted basis, which Consideration Shares are to be issued at a price equal to the 30 -day
volume weighted average price of Metalla’s common shares as of the date immediately preceding
the closing date; and
o an unsecured convertible debenture (the “Convertible Debenture”) in the principal amount of the
balance of the Purchase Price and bearing interest at a rate of 5% per annum . The Convertible
Debenture will automatically convert into comm on shares of Metalla at the time of future equity
financings (at such financing price ) or future asset acquisitions (at such acquisition price) and
enables Coeur Mining to maintain its 19.9% interest in Metalla until the outstanding principal is
either converted in full or otherwise repaid.
TRANSACTION HIGHLIGHTS
• Significant Cash Flow to Start Immediately: The Coeur Portfolio will provide immediate leverage
to silver and gold prices. Two (2) out of the four (4) assets are currently in production with the third
(3rd) planned for development by a major silver producer.
• Counterparty Diversification: The Coeur Portfolio counterparties include Cobar Operations Pty
Ltd (“Cobar”), a wholly owned subsidiary of CBH Resources Limited , Pan American Silver Corp.
(“Pan American ”), Dynasty Metals & Mining Inc ., (“ Dynasty”) and Regul us Resources Inc.
(“Regulus”).
• Asset Diversification: The Coeur Portfolio will give the Company exposure to assets in Australia,
Argentina, Ecuador, and Chile.
• Long-Term Optionality: Combination of significant near term cash flow and long life development
assets.
• New Major Shareholder: Coeur will join Metalla as its largest shareholder.
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COEUR PORTFOLIO
• Endeavor Silver Stream – Metalla estimates that the Endeavor silver stream will generate cash
flow of USD$2.5 million (CAD$3.3 million) for the balance of 2017 and USD $3.8 - $4.2 million
(CAD$5 - 5.5 million) at an average price of USD$17 per ounce of silver, before taxes for the
calendar year of 2018. This is based on an estimate of the Endeavor mine delivering approximately
987,500 ounces silver over the next 24 months according to the mine plan (with deliveries and
revenues being allocated to Metalla starting as of June 1, 2017 in accordance with the Agreement).
Metalla will have the right to buy 100% of the silver production up to 20.0 million ounces (7,120,577
ounces have been delivered as of April 2017) from the Endeavor mine in north-central New South
Wales, Australia for an operating cost contribution of USD$1.00 for each ounce of payable silver,
indexed annually for inflation, plus a further increment of 50% of the silver price when it exceeds
USD $7.00 per ounce. The Endeavor mine, operated by Cobar, is an underground zinc, lead, and
silver mine.
• 2% NSR on the Joaquin Project – a two percent NSR royalty payable by Pan American on
minerals mined from the concessions which form part of Joaquin project located in central Santa
Cruz Province, Argentina, 145 kilometres from Manantial Espejo silver -gold mine owned by Pan
American. Pan American recently purchased the Joaquin project from Coeur for US$25 million.
The Joaquin project is estimated to contain a measured and indicated resource of 65.2 million oz
silver and 61,100 ounces of gold in 15.7 million tonnes @ 128.9 gpt Ag and 0.12 gpt Au.(1)
• 1.5% NSR on the Zaruma Gold Mine – a one and a half percent NSR royalty payable by Dynasty
on minerals mined from the Zaruma gold mine located in the Zaruma-Portovelo Mining District of
southern Ecuador, 3 kilometers north of the town of Zaruma. Between 2012 and 2014 the mine
produced 72,430 ounces Au and 152,292 ounces of Ag. Dynasty has recently been restructured
and is currently only trial mining at lower levels according to the Company. The Zaruma gold mine
has an estimated measured and indicated resource of 1.094 million ounces of gold in 2.62 million
tonnes with an average grade of 12.97 gpt gold with an additional 1.448 million inferred ounces in
3.7 million tonnes at a grade of 12.2 gpt gold.(2)
• 1.5% NSR on the Puchuldiza Project – a one and a half percent NSR royalty payable by Regulus
on minerals mined from t he Puchuldiza project located in the Andean Platea u (Puna) of
northernmost Chile. The Puchudiza project has an estimated inferred resources of 686,000 ounces
of gold in the inferred category (30.07 million tonnes @ 0.71 g/t gold).(3) The Puchudiza royalty is
subject to a right of first refusal and is capped at USD$5 million.
Brett Heath, President of Metalla Royalty & Streaming commented, “This acquisition provides an
extraordinary amount of growth for Metalla. Our shareholders will benefit from the immediate
increase in annual cash flow from the Endeavor Stream as it bridges us to our existing royalty
portfolio that is expected to produce for us in the future. It also adds two more major producers as
counterparties, Pan American Silver and CBH Resources, along with further geographic and asset
diversification. Our access to capital, and market liquidity should also be meaningfully increased ,
which will allow Metalla to continue to aggressively build our royalty and streaming portfolio.”
CLOSING OF THE TRANSACTION
The closing will be subject to customary condi tions for similar transactions, including (i) notice of
the Transaction to the Cana dian Securities Exchange and (ii) entry by Metalla and Coeur into an
assignment and assumption agreement pursuant to which the Coeur Portfolio will be transferred
from Coeur to Metalla or, in the case of the Zaruma royalty and the Endeavour silver stream, Metalla
will acquire the Coeur entity holding it. Metalla must also obtain the consent of the Australian
Foreign Investment Review Board (“FIRB Approval”) in connection with acquiring its interest in the
Endeavor mine and such FIRB Approval is anticipated to require between 60 and 120 days from
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the date of execution of the Agreement. Closing of Transaction is expected to occur as soon as
possible after the receipt of the FIRB Approval.
METALLA POST CLOSING CAPITAL STRUCTURE
Following completion of the T ransaction the total issued and outstanding shares of Metalla is
expected to be approximately 71,017,747, with Coeur holding 19.9% (14,132,534 shares). There
will be no change in warrants and options outstanding. Metalla will also have the Convertible
Debenture held by Coeur for the balance of the Purchase Price . The Convertible D ebenture will
automatically convert into common shares of Metalla at future financings (at the future financing
price) or asset acquisitions (at the acquisition price) to maintain Coeur’s 19.9% until the outstanding
principal is either converted in full or otherwise repaid. The Convertible Debenture will bear interest
at a rate of 5% per annum.
Note 1: Please refer to a technical report titled “Joaquin Project NI 43 -101 Technical Report” and dated
February 15, 2013 (the “Joaquin Report”). Summary of grades and tonnage estimates for the Joaquin
project for different resources categories as disclosed by the Joaquin Report:
Note 2: Please refer to a technical report titled “Independent Preliminary Assessment – Zaruma Gold
Project – El Oro Province, Ecuador” and dated September 17, 2014 (the “Zaruma Report”). Summary of
grades and tonnage estimates for the Zaruma project for different resources categories as disclosed by
the Zaruma Report:
Tonnes Au gpt Ounces Au
Measured 1,590,000 13.48 689,000
Indicated 1,030,000 12.18 405,000
M+I 2,620,000 12.97 1,094,000
Inferred 3,700,000 12.20 1,448,000
Note 3: Please refer to a technical report titled “NI 43-101 Technical Report – Puchuldiza Project – I Region,
Chile” and dated November 7, 2011.
ABOUT METALLA
Metalla was created for the purpose of pr oviding shareholders with leveraged precious metal
exposure by acquiring royalties and streams. Our goal is to increase share value by accumulating
a diversified portfolio of royalties and streams with attractive returns. Our strong foundation of
current and future cash generating asset base, combined with an experienced team gives Metalla
a path to become one of the leading gold and silver companies for the next commodities cycle.
For further information please visit our website at www.metallaroyalty.com
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QUALIFIED PERSON (“QP”)
The technical information contained in this news release has been reviewed and approved by
Charles Beaudry, geologist M.Sc., member of the Association of Professional Geo scientists of
Ontario and of th e Ordre des Géologues du Québec and a director of Metalla. Mr. Beaudry is a
QP as defined in “National Instrument 43-101 Standards of disclosure for mineral projects.
ON BEHALF OF METALLA ROYALTY & STREAMING LTD.
“Brett Heath”
President and Director
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This release contains certain "forward looking statements" and certain "forward -looking information" as defined under applicable Canadian and
U.S. securities laws. Forward-looking statements and information can generally be identified by the use of forward -looking terminology such as
"may", "will", "should", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology.
Forward-looking statements and information include, but are not limited to, statements with respect to the transactions contemplated under the
Coeur Portfolio transaction (the “Transaction”), anticipated cash flows upon completion of the Transaction, receipt of the FIRB Approval, the
completion of the Transaction and proposed future transactions Metalla may undertake and their expected timing. Forward -looking statements
and information are based on forecasts of future results, estimates of amounts not yet d eterminable and assumptions that, while believed by
management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-
looking statements and information are subject to various kno wn and unknown risks and uncertainties, many of which are beyond the ability of
Metalla to control or predict, that may cause Metalla’s actual results, performance or achievements to be materially different from those expressed
or implied thereby, and are developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not
limited to: the requirement for regulatory approvals and third party consents, the impact of general business and economic conditions, the absence
of control over the mining operations from which Metalla will purchase gold and receive royalties, including risks related to international operations,
government relations and environmental regulation, the inherent risks involved in the exploration and development of mineral properties; the
uncertainties involved in interpreting exploration data; the potential for delays in exploration or development activities; t he geology, grade and
continuity of mineral deposits; the possibility that future explor ation, development or mining results will not be consistent with Metalla’s
expectations; accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties or interrupt ions in operations;
fluctuating metal prices; unanticipated costs and expenses; uncertainties relating to the availability and costs of financing needed in the future; the
inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations; currency
fluctuations; regulatory restrictions, including environmental regulatory restrictions; liability, competition, loss of key employees and other related
risks and uncertainties. Metalla undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-
looking information represents management's best judgment based on information currently available. No forward -looking statement can be
guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward -looking
statements or information.
This news release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Metalla’s anticipated
revenues from the Endeavor silver stream which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the
above paragraphs. FOFI contained in this news release was made as of the date of this news release and was provided for the purpose of
providing further information about Metalla’s anticipated future business operations. Metalla disclaims any intention or obligation to update or
revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to
applicable law. FOFI contained in this news release should not be used for purposes other than for which it is disclosed herein.
The disclosure in this press release is based on information publicly disclosed by the owners or operators of these properties and information/data
available in the public domain as at the date hereof and none of this information has been independently verified by Metalla.
CONTACT INFORMATION
Metalla Royalty & Streaming Ltd.
Brett Heath, President
Phone: 604-696-0741
Email: [email protected]
Website: www.metallaroyalty.com