Sierra Madre closes $17.82M final tranche of placement

Executive Summary

• Sierra Madre Gold and Silver Ltd. has closed the second and final tranche of its $57.5 million brokered private placement of subscription receipts, bringing total gross proceeds to $57,500,690.
• The financing is directly linked to the company's proposed acquisition of the Del Toro silver mine from First Majestic Silver Corp., with a significant portion of the proceeds ($17.57M) held in escrow pending regulatory and shareholder approvals.
• The company intends to use the net proceeds to finance the completion of the Del Toro acquisition, fund exploration and development of the mine, and support general working capital.

Key Details

• Total Gross Proceeds: $57,500,690 (including full exercise of the agents' option).
• Second Tranche Specifics:
  • Gross proceeds: $17,822,449.
  • Subscription receipts issued: 13,709,576.
  • Price per subscription receipt: $1.30.
• Aggregate Issuance: 44,231,300 subscription receipts issued in total across both tranches.
• Escrow Arrangement:
  • $17,569,531 from the second tranche (gross proceeds less 50% of agents' fees and certain expenses) was placed into escrow.
  • Release conditions include receipt of all required corporate, shareholder, and regulatory approvals for the Del Toro transaction.
  • Deadline for satisfaction of conditions: 5 p.m. Toronto time on May 14, 2026.
  • If conditions are met by the deadline, the remaining 50% of agents' fees ($226,036 plus interest) is released to agents, and the balance goes to the company.
  • If conditions are not met, proceeds (plus interest, net of withholding tax) are returned to holders, and subscription receipts are cancelled.
• Use of Proceeds: Financing the completion of the Del Toro acquisition, exploration and development of Del Toro post-closing, and general working capital.
• Agent Compensation:
  • Cash commission and corporate finance fee paid: $452,072.
  • 50% of the fee ($226,036) placed into escrow.
  • Issuance of 346,479 compensation options to agents.
  • Option terms: Entitle agents to purchase one common share at the issue price for a term of 24 months from the closing of the second tranche.
• Securities Restrictions: Four-month hold period from the date of closing for securities issued in the second tranche.
• Regulatory Status: Offering remains subject to final approval of the TSX Venture Exchange.
• Lead Agent: Beacon Securities Ltd.
• Syndicate Agents: Canaccord Genuity Corp., BMO Capital Markets, and VSA Capital Ltd.

Notable Quotes

• No direct quotes from the CEO or President were included in the provided text.