Americas Gold & Silver Secures $100M Debt Facility to Fund Galena Complex Expansion

• Americas Gold & Silver Corporation has arranged a US$100 million senior secured debt facility to fund growth and development capital spending at its Galena Complex in Idaho.
• The company has entered into an off-take agreement with Ocean Partners USA Inc. for treatment of up to 100% of concentrates from the Galena Complex at Teck Resources' Trail Operations.
• Ocean Partners will invest US$11.5 million in equity through a private placement of 16.8 million shares at C$0.95 per share, representing a 14% premium to the 20-day volume-weighted average price.
• The debt facility consists of three tranches: US$50 million at closing with SOFR plus 6% interest, and two additional US$25 million tranches with varying interest rates upon meeting conditions.
• The transaction supports Americas' strategic objective of generating over 80% of revenue from silver by the end of 2025, positioning the company as a leading North American silver-focused producer.

Americas Gold & Silver Corporation (TSX:USA) is a growing North American precious metals producer operating multiple mining assets. The company owns and operates the Cosalá Operations in Sinaloa, Mexico, and in December 2024 acquired 100% ownership of the Galena Complex in Idaho through a transaction with Eric Sprott and a Paul Huet-led management team. Sprott currently holds approximately 20% of the company as its largest shareholder.

For investors evaluating Americas Gold & Silver, this latest financing package represents a significant milestone in the company's transformation strategy, providing the capital foundation necessary to execute its ambitious growth plans while securing critical processing capacity for its expanding operations.

$100M Debt Facility Structure

The US$100 million Term Loan Facility demonstrates a carefully structured approach to financing the company's expansion plans. The facility consists of three distinct tranches designed to align with Americas' capital deployment timeline at the Galena Complex.

The initial tranche provides US$50 million at closing, carrying an interest rate of SOFR (with a 4% floor) plus 6%, maturing 60 months from the closing date. Principal amortization begins one year after closing with quarterly payments thereafter. Two additional tranches of US$25 million each become available upon achieving certain conditions precedent, with the first carrying SOFR plus 6% and the second offering more favorable terms at SOFR plus 4%.

In the news release, Paul Andre Huet, Chairman & CEO, emphasized the transformational nature of the financing package:

"Today's announcement represents a major milestone for Americas Gold and Silver shareholders. The culmination of months of work, the $100 million in non-dilutive debt financing will allow us to both aggressively pursue our capital development spending at the Galena Complex and further strengthen our balance sheet," Huet stated.

The lender will hold senior security over all company assets except those relating to the Cosalá Operations in Mexico and the Relief Canyon Project in Nevada, which remain secured by existing agreements with Trafigura and Sandstorm respectively. Funding of the initial US$50 million is expected during June 2025, providing immediate capital for the company's development plans.

Strategic Off-take Agreement

The off-take agreement with Ocean Partners represents a critical component of Americas' operational strategy, securing processing capacity at one of North America's most sophisticated metallurgical facilities. The agreement covers treatment of up to 100% of concentrates from the Galena Complex at Teck Resources' Trail Operations in British Columbia, described as one of the world's largest fully-integrated zinc, lead and critical metals complexes.

This arrangement addresses a fundamental challenge facing mining companies: securing reliable, cost-effective processing capacity in close geographic proximity to operations. The Trail Operations facility's location and capabilities make it an optimal receiver for the polymetallic concentrates produced at Galena, enabling recovery of silver along with various by-product metals.

Huet highlighted the strategic value of the partnership.

"Regarding our future offtake strategy, I am very pleased to have closed a strong agreement at very competitive terms with Ocean Partners for treatment of up to 100% the precious and base metals concentrate produced from our Galena Complex at Teck's Trail Operations."

Operational Improvements

The debt facility enables Americas to execute a comprehensive capital development program at the Galena Complex. The company's focus on materials handling optimization reflects a systematic approach to operational enhancement, with projects driven by detailed engineering studies rather than speculative improvements.

The reintroduction of Long Hole Stoping represents a significant operational shift that should improve mining efficiency and ore recovery rates. Associated underground development work will support expanded production capacity while equipment purchases and shaft upgrades address infrastructure bottlenecks that currently limit operational throughput.

Management's emphasis on productivity improvements and hoisting schedule efficiency indicates a focus on maximizing asset utilization rather than simply expanding production volume. This approach suggests a mature understanding of operational optimization that should translate into improved margins and cash flow generation.

Equity Investment & Shareholder Value

Ocean Partners' decision to invest US$11.5 million in equity at a 14% premium to market prices provides external validation of Americas' growth strategy. The private placement involves 16.8 million common shares at C$0.95 per share, demonstrating institutional confidence in the company's prospects.

This equity investment serves multiple strategic purposes beyond capital provision. It aligns Ocean Partners' interests with Americas' operational success while satisfying a pre-financing condition for the debt facility. The premium pricing indicates sophisticated investors view the company's current market valuation as attractive relative to its growth potential.

The combination of debt and equity financing provides Americas with enhanced financial flexibility while limiting dilution compared to an equity-only approach. This structure preserves upside potential for existing shareholders while providing adequate capital for the company's expansion plans.

Conclusion for Investors

Americas' strategic objective of generating over 80% of revenue from silver by the end of 2025 positions the company to benefit from silver market dynamics while reducing exposure to base metals price volatility. This focus aligns with growing industrial demand for silver across technology applications, renewable energy systems, and traditional jewelry markets.

The Galena Complex acquisition strengthened Americas' position as a significant North American silver producer, complementing existing operations in Mexico. The combination of assets provides operational diversification while maintaining focus on precious metals production.

The strategic partnership with Ocean Partners and access to Teck's Trail Operations provides operational advantages that may not be fully reflected in current market valuations. These relationships represent significant competitive advantages in a sector where processing capacity and logistics can constrain profitability.

For investors evaluating Americas Gold & Silver, the financing package provides the foundation for significant operational expansion while the offtake agreement secures critical processing capacity. The company's transformation into a primarily silver-focused producer offers exposure to precious metals markets with reduced capital intensity compared to greenfield development projects.