Metalla Signs Definitive Agreement to Acquire a 15% Interest IN the Nlgm Silver Stream and an Option to Invest at Cost IN a Subsequent Stream from Silverback Ltd.
METALLA SIGNS DEFINITIVE AGREEMENT TO ACQUIRE A 15%
INTEREST IN THE NLGM SILVER STREAM AND AN OPTION TO INVEST
AT COST IN A SUBSEQUENT STREAM FROM SILVERBACK LTD.
FOR IMMEDIATE RELEASE Toronto CSE: MTA
OTCQB: EXCFF
April 28, 2017
Frankfurt: X9CP
Toronto, Canada: Metalla Royalty & Streaming Ltd . (“Metalla” or the “Company”)
(CSE:MTA) (OTCQB:EXCFF) (FRANKFURT:X9CP) is pleased to announce that Metalla
SEZC (the Company’s 100% owned Cayman subsidiary) h as signed a definitive
agreement to acquire 15% of the issued shares of Silverback LTD (“Silverback”), together
with an option on a second stream for a net amount US$1.86 million. The first payment
from Silverback will be credited against the purchase price. (as discussed below).
Silverback is a privately held Guernsey-based inves tment company that solely owns
100% of the New Luika Gold Mine (“NLGM”) silver str eam which it purchased to provide
Shanta Gold Limited (“Shanta”), the operator, with construction financing for the
underground mine transition. The NLGM underground m ine has made significant
progress over the last 12 months successfully produ cing its first underground gold in
December 2016. During this period NLGM’s reserve ba se was significantly increased
through targeted exploration extending the operatio n’s mine life with further increases
anticipated.
Closing of the transaction by Metalla SEZC and Silv erback is expected to occur on or
about May 11th, 2017 and is subject to conditions customary for similar transactions.
SILVER STREAM
Metalla SEZC will have a 15% interest in Silverback , which is entitled to purchase silver
pursuant to the Silver Streaming Agreement dated May 6, 2016 (“SSA”). Under the SSA,
silver is purchased at 10% of the silver spot price (Example: US$1.80 per oz Ag payable
in cash for US$18 silver spot price). The SSA relates solely to silver by-product production
from the NLGM located in the Mbeya region in the Lupa Goldfield in south west Tanzania.
The SSA will have minimum silver delivery obligatio ns totaling 608,970 oz Ag over the
first 6.75 years. The SSA continues through 2026 and silver deliveries will be on an annual
basis for the first seven years and then on a monthly basis.
Metalla’s first delivery of 8,008 ounces of silver sold at US$17.25/oz price for a total of
US$138,136 from production from October 2016 through March 2017 has been credited
against the initial purchase price of US$2 million. The SSA covers 100% of monthly silver
production up to 11,250 ounces and 80% of the silve r production thereafter. The SSA is
secured against the Singida mining licenses, a development gold asset located in central
Tanzania. The security amortizes over the 6.75 year s of the silver deliveries and
automatically subordinates should a minimum of $6 million of project finance for Singida’s
development.
The NLGM is a producing gold mine that contains a s ilver by-product that reached
commercial production in 2013. NLGM does not have s ufficient data to estimate a silver
reserve. In Q1 2017, NLGM produced 28,750 oz Ag. Th e mine produced 81,873 oz Au
and 121,682 oz Ag in 2015 and 87,713 oz Au and 126, 572 oz Ag in 2016 with AISC of
US$661 per oz Au according to its Q4 2016 productio n and operational update. As part
of the transaction, Metalla also has an option to invest in a second streaming transaction.
Any future transactions are subject to diligence and financing.
Cautionary note regarding forward-looking statements
This release contains certain "forward looking stat ements" and certain "forward-looking information" a s defined under applicable
Canadian and U.S. securities laws. Forward-looking statements and information can generally be identif ied 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 Silverback transaction (the “ Transaction ”), anticipated cash flows upon completion of the T ransaction, 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 determinable and assumptions that, while believed
by management to be reasonable, are inherently subj ect to significant business, economic and competiti ve uncertainties and
contingencies. Forward-looking statements and information are subject to various known 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 assumpt ions about such risks,
uncertainties and other factors set out herein, inc luding but not limited to: the requirement for regu latory approvals and third party
consents, the impact of general business and econom ic conditions, the absence of control over the mini ng operations from which
Metalla will purchase gold and receive royalties, i ncluding risks related to international operations, government relations and
environmental regulation, the inherent risks involv ed in the exploration and development of mineral pr operties; the uncertainties
involved in interpreting exploration data; the pote ntial for delays in exploration or development acti vities; the geology, grade and
continuity of mineral deposits; the possibility that future exploration, development or mining results will not be consistent with Metalla’s
expectations; accidents, equipment breakdowns, titl e matters, labor disputes or other unanticipated di fficulties or interruptions 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 relate d risks and uncertainties. Metalla undertakes no ob ligation 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 forwar d-looking statement can be guaranteed and actual fu ture results may vary
materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.
Technical Disclosure
The disclosure in this press release relating to NLGM is based on information publicly disclosed by the owners or operators of these
properties and information/data available in the pu blic domain as at the date hereof and none of this information has been
independently verified by Metalla. Specifically, since the Company is not a party to the SSA, it has limited access to NLGM.
Metalla Royalty & Streaming Ltd. is a precious metals royalty and streaming company engaged
in the acquisition and management of precious metal royalties, streams, and similar production
based interests.
On behalf of the Board of Directors:
“Brett Heath”
President and Director
Metalla Royalty & Streaming Ltd.
For more information, please contact:
Tel: 416-925-0090
Email: [email protected]
Website : www.metallaroyalty.com