USA.TO · 2018-09-30 12:00:00

Americas Silver Corporation and Pershing Gold Corporation Announce Business Combination

Mergers & Acquisitions

TORONTO, ONTARIO – September 30, 2018 – Americas Silver Corporation (TSX: USA) (N YSE American:

USAS) (“Americas Silver”) and Pershing Gold Corporation (NASDAQ: PGLC) (TSX: PGLC) (FWB: 7PG1)

( “ P e r s h i n g ” ) a r e p l e a s e d t o a n n o u n c e t h a t t h e y h a v e e n t e r e d i n to a definitive agreement (the

“Agreement”) to complete a business combination (the “Transacti on”) and create a low‐cost, precious

metal growth company in the Americas.

Highlights of the Transaction

Key investment highlights of the combined company include:

 Diversified portfolio of precious m e t a l a s s e t s i n t h e A m e r i c a s : Combines two producing

polymetallic mines in Mexico and I daho that are expected to pro duce approximately 7.0 million

silver equivalent ounces with an attractive shovel‐ready, preci ous metal development project in

Nevada with the potential, demonstrated by a feasibility study, to add approximately 91,000 gold

ounces annually.

 Enhanced growth and scale: Near‐term precious metal production growth from Relief Canyon

and Zone 120 and ongoing ramp‐up at the San Rafael mine is expe cted to meaningfully improve

production and cash flow in 2020 and beyond.

 Proven management team and Board: Demonstrated experience in financing, acquiring, building

and operating open pit and underground mines.

 Strong financial position: Increasing cash flow generation from the San Rafael mine and greater

access to capital to fund the development of Relief Canyon.

 E n ha n ce d cap i t a l ma r ke t s p r o f i le : The combined company is expected to appeal to a broader

institutional shareholder base, increase research coverage, and improve share trading liquidity.

 Compelling value proposition: Leading leverage among junior precious metal equities and

attractive relative valuation to support a potential future re‐valuation.

 Unanimous board approval and significant Pershing shareholder support: The Board of Directors

of both companies have unanimously recommended support for the Transaction. Additionally,

Mr. Barry Honig has entered into an unconditional lock‐up agreement in favour of the Transaction,

representing support for the Transaction of approximately 31% of the outstanding common

shares and 87% of the outstanding preferred shares of Pershing.

“This transaction aligns with our stated initiative of building a profitable and low‐cost precious metal

company in the Americas by operating and building low risk, low capital, high return projects,” said Darren

Blasutti, President and Chief Executive Officer of Americas Sil ver. “With the on‐schedule and on‐budget

construction and rapid commissioning of San Rafael now successf ully completed, we are focused on the

n e x t l e g o f g r o w t h – t o d a y ’ s t r a n s a c t i o n d e l i v e r s t h i s g r o w t h platform, while also providing us with

additional precious metal exposure and a near‐term operating presence in Nevada.”

“We are excited to announce today’s transaction and believe thi s provides a clear path to the

development of Relief Canyon,” stated Steve Alfers, President a nd Chief Executive Officer of Pershing.

“With the increased financial and operating capabilities of the combined company, our shareholders are

better positioned to realize significant value from Relief Cany on as it is advanced through construction

and into production.”

Under the terms of the Agreement, holders of Pershing common shares will receive 0.715 common shares

of Americas Silver for each common share of Pershing by way of a share exchange (the “Exchange Ratio”).

Holders of Pershing preferred shares may elect to exchange thos e shares for new non‐voting preferred

shares of Americas Silver, adjusted in respect of exercise price and number based on the Exchange Ratio,

or common shares of Americas Silver based on the Exchange Ratio. Based on the closing price of Americas

Silver on the NYSE American on September 28, 2018, this implies a value of US$1.69 per Pershing common

share. This represents a 39% premium to Pershing’s closing pri ce on the NASDAQ and a 39% premium

based on the volume weighted average prices of Americas Silver and Pershing for the 10‐day period

ending on September 28, 2018. Ex isting shareholders of America s Silver and Pershing will own

approximately 64% and 36%, respectively, on an undiluted basis, following the close of the Transaction.

Benefits to Americas Silver

 Addition of a high quality shovel‐ready, precious metal developm e n t p r o j e c t w i t h l o w c a p i t a l

intensity and robust project economics at current gold prices

 Nevada operations base with a large prospective and underexplored land package

 Immediately accretive to precious metal mineral reserves and resources and on all financial

metrics by 2020

 Feasibility study for the Relief Canyon project highlights appr oximately 91,000 ounces of annual

gold production, a pre‐tax NPV (5% discount) of US$118M and pre ‐tax IRR of 71% at spot gold

prices

Benefits to Pershing

 Immediate upfront premium of approximately 40% to the closing price of Pershing common

shares prior to announcement of the Transaction

 Meaningful ongoing exposure to future value creating milestones at Relief Canyon, as well as

Americas Silver’s quality portfolio of producing, development an d e x p l o r a t i o n a s s e t s t h r o u g h

significant ownership in a larger and more diversified company

 Proven mine building and operating team to develop Relief Canyon

 Enhanced size and quality enable financing of Relief Canyon at a lower cost of capital

 Mitigation of single‐asset risk

Board of Directors’ Recommendations

The Board of Directors of each company has determined that the p r o p o s e d T r a n s a c t i o n i s i n t h e b e st

interests of their respective shareholders based on a number of factors, including receipt of independent

opinions as to the fairness, from a financial point of view, of the Transaction. Each company’s Board of

Directors unanimously approved th e t e r m s o f t h e T r a n s a c t i o n a n d recommends that their respective

shareholders vote in favor of the Transaction.

E a c h o f t h e o f f i c e r s a n d d i r e c t o r s o f A m e r i c a s S i l v e r a n d P e r s hing have entered into agreements

supporting the Transaction pursuant to which they will vote any common shares of the companies that

are held by them in favor of the approval of the Transaction. In addition, Mr. Barry Honig who holds or

controls (collectively under his various holdings) approximately 31% of the outstanding Pershing common

shares and 87% of the outstanding Pershing preferred shares has entered into an unconditional lock‐up

agreement and has agreed to vote in favor of the Transaction.

Management Team and Board of Directors

The combined company will be managed by the executive team of Americas Silver, led by Darren Blasutti

as President and Chief Executive Officer.

Alex Davidson will be the Chairman of the combined company, whic h w i l l c o m p r i s e n i n e m e m b e r s .

Pershing’s board will designate one individual to join the combined board.

Bridge Loan

In connection with the proposed Transaction, Pierre Lassonde an d Trinity Capital Partners have provided

Americas Silver with a C$5.5 million short‐term secured convert ible loan with interest payable at 1.25%

per month. The net proceeds of this loan will be used by Ameri cas Silver to fund a US$4 million short‐

term secured first lien convertible loan (the “Bridge Loan”) to address Pershing’s near‐term working

capital requirements, including permit advancements, ongoing property maintenance and corporate

requirements.

The terms of the Pershing Bridge Loan include a repayment date which is 9 months from the date of the

loan and interest payable at 16% per annum. If the Transaction is not consummated, the loan must be

repaid in cash, however, if the Transaction is not consummated due to certain circumstances, Pershing

will have the option to repay the loan through issuance of its common shares priced at the then‐prevailing

market price (but not less than $1.18 per share).

Details of the Transaction

The Transaction will be structured as a share exchange under Ne vada law, whereby all of the issued and

outstanding common shares of Pershing shall be acquired, direct ly or indirectly, by Americas Silver for

common shares of Americas Silver b ased upon the Exchange Ratio. It requires the approval of Pershing

shareholders by way of special resolution by shareholders holdi ng at least a majority of the outstanding

voting shares of Pershing, and approval by preferred shareholde rs holding at least 75% of the Pershing

preferred stock, each at a special meeting of Pershing shareholders to be held in connection with the

Transaction. Approval by (i) a simple majority of votes cast b y Americas Silver shareholders and (ii) a

special resolution of shareholders of Americas Silver to approve the amendment of its articles to provide

for the new non‐voting preferred shares to be issued, will also be required at a special meeting of the

shareholders of Americas Silver that will be held in connection with the Transaction. In addition, the

Transaction will be subject to the approval of the listing of t he additional Americas Silver shares by the

Toronto Stock Exchange and NYSE American.

The Agreement includes customary provisions including, among other things, a non‐solicitation covenant

with respect to Pershing, and associated fiduciary out covenant s and a right by Americas Silver to match

any superior proposal. In the event that Pershing wishes to terminate the Agreement in order to support

a superior proposal, Pershing would be obligated to pay Americas Silver an amount equal to US$4 million

as a termination payment. Expense reimbursement of up to US$60 0,000 is payable by each party in the

event that approval from its shareholders is not obtained.

Timing

Americas Silver and Pershing expect to mail shareholder information circulars in Q4, 2018 subject to

required regulatory approvals and plan to hold their respective shareholder meetings promptly

thereafter. The Transaction is expected to close in Q1, 2019.

Advisors and Counsel

Trinity Advisors Corporation is acting as financial advisor to Americas Silver. Blake, Cassels & Graydon LLP

is acting as Canadian legal counsel, Troutman Sanders LLP is acting as U.S. legal counsel and Parsons Behle

& Latimer is acting as Nevada Counsel to Americas Silver.

Clarus Securities Inc. provided a fairness opinion to the Board of Directors of Americas Silver. H.C.

Wainwright & Co. acted as strategic advisor to Americas Silver.

Canaccord Genuity is acting as financial advisor to Pershing an d provided a fairness opinion to the Board

of Directors to Pershing. Davis Graham & Stubbs LLP is acting as U.S. legal counsel and Stikeman Elliott

LLP is acting as Canadian legal counsel to Pershing.

Conference Call

A joint conference call will be held on October 1, 2018 at 8:30am EDT to discuss the Transaction. An

investor presentation will be available on each company’s website prior to the call. The call‐in details are

as follows:

 Local and international: +1 (416) 981‐9018

 Canada and US toll‐free: +1‐800‐584‐0405

 Participant URL: https://cc.callinfo.com/r/1wcvxnrrh48jn&eom

Callers are advised to dial‐in 10‐15 minutes prior to the call. As there is no audio on the participant URL,

please dial‐in to follow along with the presentation.

Qualified Persons

Daren Dell, Chief Operating Officer and a Qualified Person under Canadian Securities Administrators

guidelines, has approved the applicable contents of this news release. For further information please see

the “Technical Report and Estimated Resources for the San Felipe Project, Sonora, Mexico” with an

effective date of March 15, 2018, the “Americas Silver Corporation Technical Report on the Galena

Complex, Shoshone County, Idaho, USA” with an effective date of December 23, 2016, and “Technical

Report and Preliminary Feasibility Study for the San Rafael Pro perty, Sinaloa, Mexico” with an effective

date of March 18, 2016, as applicable, which are available on Americas Silver’s profile on SEDAR at

www.sedar.com or at americassilvercorp.com.

All scientific and technical information related to Relief Canyon project has been reviewed and approved

by either Paul Tietz, Certified Professional Geologist #11720, Neil Prenn, P.E. #7844, Carl Defilippi,

registered member SME#775870RM, o r Mark Jorgensen, MMSA#01202QP w h o a r e e a c h Q u a l i f i e d

Persons under the definitions established by Canadian National Instrument 43‐101. For further

information please see “Technical Report and Feasibility Study for the Relief Canyon Project, Pershing

County, Nevada, U.S.A.” with an effective date of May 24, 2018, which is available on Pershing’s EDGAR

profile at https://www.sec.gov/ and on SEDAR at www.sedar.com.

About Americas Silver

Americas Silver is a silver mining company focused on growth in precious metals from its existing asset

base and execution of targeted accretive acquisitions. It owns and operates the Cosalá Operations in

Sinaloa, Mexico and the Galena Mine Complex in Idaho, USA. Amer icas Silver holds an option on the San

Felipe development project in Sonora, Mexico. For further info r m a t i o n p l e a s e s e e S E D A R o r

americassilvercorp.com.

About Pershing Gold Corporation

Pershing Gold Corporation is an emerging gold producer whose pr imary asset is the Relief Canyon open‐

p i t g o l d m i n e i n P e r s h i n g C o u n t y , N e v a d a . U n d e r t h e F e a s i b i l i t y Study completed in May 2018, Relief

Canyon is expected to have an average life‐of‐mine gold product ion of 91,000 ounces per year with cash

costs of US$769 per ounce and AISC of $801 per ounce. Upon successful project financing, Relief Canyon

is expected to have a short six‐to‐nine month construction period before commencing production.

Pershing’s landholdings cover over 29,000 acres that include Re lief Canyon Mine and surrounding lands

in all directions. This provides Pershing with the opportunity to expand the Relief Canyon Mine deposit

and to explore and make new discoveries nearby. Pershing is cur rently permitted to resume mining at

Relief Canyon under the existing Plan of Operations.

Pershing Gold is listed on the NASDAQ Global Market and the Tor onto Stock Exchange under the symbol

"PGLC" and on the Frankfurt Stock Exchange under the symbol 7PG1.

About Trinity Capital Partners

Trinity Capital Partners is a mining investment and advisory firm backed by leading North American

investors with many decades of i nternational mine operating and investment experience. Together with

Pierre Lassonde, it seeks to acqu ire interests in mining assets and companies, both public and private,

around the world with a specific focus on precious and base met als. The firms' principals have executed

many billions of dollars worth of M&A transactions, mine financ e (equity, debt and royalty/streaming)

and mining investments.

Cautionary Statement on Forward‐Looking Information:

This news release contains “forward‐looking information” within the meaning of applicable securities

laws. Forward‐looking information includes, but is not limited t o , A m e r i c a s S i l v e r ’ s a n d P e r s h i n g ’ s

expectations intentions, plans, assumptions and beliefs with re spect to, among other things, the

realization of exploration, operational, production, and develo pment plans, the Cosalá Operations

(including Zone 120) and Galena Complex; Americas Silver’s fina ncing efforts; the consummation of the

Transaction in accordance with its terms; the anticipated silver and gold production of the combined

company; potential improvements in production, cash flow, share holder liquidity, and access to capital;

perceptions of institutional shareholders and analysists; any potential re‐rating; references to anticipated

profits, risk, realized value and return; construction, production, and development plans at Relief Canyon

Mine; the relative ownership of shareholders in the combined company; the future management and

board of the combined company; the timing of shareholder proxies, meetings and the closing of the

Transaction; estimates and forecasts with respect to the expect ed project economics for Relief Canyon

derived from the Feasibility Study, such as estimates of averag e production, AISC, IRR, NPV; cash costs;

the availability of financing and the estimated construction ti meline for Relief Canyon Mine; and

opportunities for expanding the Relief Canyon Mine deposit and exploring opportunities on nearby lands.

Often, but not always, forward‐looking information can be ident ified by forward‐looking words such as

“anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “estimate”, “may”, “assume” and “will” or

similar words suggesting future outcomes, or other expectations , beliefs, plans, objectives, assumptions,

intentions, or statements about future events or performance. F orward‐looking information is based on

the opinions and estimates of Americas Silver and Pershing as o f the date such information is provided

and is subject to known and unknown risks, uncertainties, and o ther factors that may cause the actual

results, level of activity, performance, or achievements of Ame ricas Silver or Pershing to be materially

different from those expressed or implied by such forward looking information. With respect to the

Transaction, these risks and uncertainties include the risk that Americas Silver or Pershing may be unable

to obtain any regulatory approvals required for the Transaction , or that regulatory approvals may delay

the transaction or cause the parties to abandon the Transaction; the risk that required stockholder

approvals may not be obtained; the risk that other conditions t o closing may not be satisfied; the length

of time needed to consummate the proposed Transaction, which may b e l o n g e r t h a n a n t i c i p a t e d f o r

various reasons; the risk that the businesses will not be integ rated successfully; the diversion of

management time on transaction‐related issues; the risk that co sts associated with the integration are

higher than anticipated; and litigation risks related to the Transaction. With respect to the businesses of

Americas Silver and Pershing, these risks and uncertainties include interpretations or reinterpretations of

geologic information, unfavorable exploration results, inability to obtain permits required for future

exploration, development or production, general economic condit ions and conditions affecting the

industries in which the Company and Pershing operate; the uncer tainty of regulatory requirements and

approvals; fluctuating mineral and commodity prices, and the ability to obtain necessary future financing

o n a c c e p t a b l e t e r m s o r a t a l l ; t h e a b i l i t y t o d e v e l o p a n d o p e r ate the Cosalá, Galena, Relief Canyon

properties, risks associated wit h the mining industry such as e conomic factors (including future

commodity prices, currency fluctuations and energy prices), gro und conditions and factors other factors

limiting mine access, failure of plant, equipment, processes and transportation services to operate as

anticipated, environmental risks, government regulation, actual r e s u l t s o f c u r r e n t e x p l o r a t i o n a n d

production activities, possible variations in ore grade or recovery rates, permitting timelines, capital

expenditures, reclamation activities, labor relations, social a nd political developments and other risks of

the mining industry. Although the Company has attempted to identify important factors that could cause

actual results to differ materially from those contained in forward‐looking information, there may be

other factors that cause results not to be as anticipated, esti mated, or intended. Readers are cautioned

not to place undue reliance on such information. Additional inf ormation regarding the factors that may

cause actual results to differ materially from these forward‐lo oking statements is available in Pershing’s

filings with the Securities and Exchange Commission, including the Annual Report on Form 10‐K for the

year ended December 31, 2017, and in the Americas Silver’s filings with on SEDAR. Neither Americas Silver

nor Pershing undertake any obligation to update publicly or oth erwise revise any forward‐looking

information whether as a result of new information, future events or other such factors which affect this

information, except as required by law. Neither Americas Silver nor Pershing gives any assurance (1) that

Americas Silver and Pershing will achieve its expectations, or (2) concerning the result or timing thereof.

All subsequent written and oral forward‐looking statements concerning Pershing, Americas Silver, the

proposed transaction, the combined company or other matters and attributable to Pershing or Americas

Silver or any person acting on their behalf are expressly qualified in their entirety by the cautionary

statements above.

No Offer or Solicitation

This press release is for informational purposes only and does not constitute an offer to sell or the

solicitation of an offer to buy any securities or a solicitatio n of any vote or approval with respect to the

proposed transaction between Americas Silver and Pershing or ot herwise, nor shall there be any sale of

securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration

or qualification under the securities laws of any such jurisdict i on . N o of f e r of se c u r it i e s sh al l b e m ade

except by means of a prospectus meeting the requirements of Sec tion 10 of the United States Securities

Act of 1933, as amended.

Participants in Merger Solicitation

Pershing, Americas Silver and certain of their respective direc tors, executive officers and other members

of management and employees may be deemed to be participants in the solicitation of proxies from the

stockholders of Pershing and Americas Silver in connection with the proposed transaction. Information

about the directors and executive officers of Pershing is set forth in its proxy statement for its 2018 annual

meeting of stockholders, which was filed with the U.S. Securiti es and Exchange Commission (the “SEC”)

on April 30, 2018. Information about the directors and executive officers of Americas Silver is set forth in

its Form 6‐K for its 2018 annual meeting of shareholders, which was filed with the SEC on April 13, 2018.

These documents can be obtained free of charge from the sources indicated below. Other information

regarding those persons who are, under the rules of the SEC, pa rticipants in the proxy solicitation and a

description of their direct and indirect interests, by security holdings or otherwise, will be contained in

Pershing’s proxy statement/prospectus and other relevant materi als to be filed with or furnished to the

SEC when they become available.

Additional Information and Where to Find It

The proposed transaction (or certain matters related thereto) between Americas Silver and Pershing will

b e s u b m i t t e d t o t h e r e s p e c t i v e s t o c k h o l d e r s o f A m e r i c a s S i l v e r and Pershing for their consideration.

Americas Silver will file with the SEC a registration statement on Form F‐4 that will include a proxy

statement of Pershing that also constitutes a prospectus of Ame ricas Silver. Americas Silver will file an

Information Circular with the applicable Canadian securities administrators. Pershing will deliver the proxy

statement/prospectus to its stockholders as required by applica ble law. Americas Silver will deliver the

Information Circular to its stockholders as required by applica ble law. Americas Silver and Pershing also

plan to file or furnish other documents with the SEC regarding the proposed transaction. This press release

is not a substitute for any prospectus, proxy statement, information circular or any other document which

Americas Silver and Pershing may file with or furnish to the SE C in connection with the proposed

transaction. INVESTORS AND SECURITY HOLDERS OF AMERICAS SILVER AND PERSHING ARE URGED TO

READ THE PROXY STATEMENT/PROSPEC TUS AND INFORMATION CIRCULAR AN D ANY OTHER RELEVANT

DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY

B E C O M E A V A I L A B L E B E C A U S E T H E Y W I L L C O N T A I N I M P O R T A N T I N F O R M A T I ON ABOUT AMERICAS

SILVER, PERSHING, THE PROPOSED TRANSACTION AND RELATED MATTERS. Investors and stockholders

will be able to obtain free copies of the proxy statement/prosp ectus and information circular and other

documents containing important information about Americas Silve r and Pershing, once such documents

are filed with the SEC through the website maintained by the SEC at www.sec.gov, and with the Canadian

securities administrators, through the website at www.sedar.com. Pershing and Americas Silver will make

available free of charge at www.pershinggold.com and www.americassilvercorp.com, respectively (in the

“Investor Relations” and “Investo rs” section, as applicable), c opies of materials they file with, or furnish

to, the SEC and the Canadian securities administrators.

For more information:

Darren Blasutti

President and CEO

416‐848‐9503

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