Americas Gold & Silver Terminates Silver Delivery Agreement with Sprott Mining Inc. in Exchange for Equity

Americas Gold & Silver Corporation has agreed with Sprott Mining Inc. to terminate the remaining 592,000 ounces of silver under the existing Silver Delivery Agreement in exchange for 7,956,696 common shares issued at a deemed price of US$5.57 per share. The transaction, subject to TSX approval, removes over US$45 million in variable future debt obligations and eliminates future cash debt service requirements associated with the silver stream, allowing the company to reinvest capital into operations and deliver operational performance directly to shareholders.

Company Overview

Americas Gold & Silver (TSX: USA | NYSE American: USAS)  is a North American mining company producing silver, copper, lead, and antimony from operations in the US and Mexico. The company owns the Galena Complex in Idaho, the nation's largest antimony mine, and the Cosalá Operations in Sinaloa, Mexico. Americas is fully funded to grow production with an aim to be a leading North American silver producer and a key source of US-produced antimony.

Silver Stream Termination Strengthens Balance Sheet

Americas Gold & Silver has reached an agreement with Sprott Mining Inc. to terminate the remaining obligation under the existing Silver Delivery Agreement in exchange for shares of the company. The transaction eliminates the outstanding 592,000 ounces of silver delivery obligation through the issuance of 7,956,696 common shares at a deemed price of US$5.57 per share. The share issuance requires TSX approval and will be subject to a four-month hold period under applicable securities laws.

The termination removes over US$45 million in variable future debt obligations from the Americas' balance sheet. The Silver Delivery Agreement was originally established as part of the December 2024 Consolidation Transaction, in which Americas acquired 100% ownership of the Galena Complex in Idaho from Eric Sprott, who held a 40% stake in the operation and became the company's largest shareholder.

Operational & Financial Implications

The elimination of the silver stream agreement removes a significant encumbrance on the company's operations, allowing operational performance to translate directly to shareholder value without the obligation to deliver physical silver. At current spot silver prices, the termination represents a material reduction in future cash debt service requirements, creating additional flexibility for capital allocation and operational reinvestment.

Chairman and Chief Executive Officer of Americas Gold & Silver, Paul Andre Huet, stated: 

"Today's announcement marks a significant step in further strengthening both our balance sheet and business via a very strong endorsement made by our largest shareholder. Mr. Sprott's decision to convert his silver stream agreement into additional Americas equity at a share price materially above his initial entry as part of the Consolidation Transaction, reflects his strong commitment to and belief in the value yet to be unlocked in our significant asset base. I would like to personally thank Mr. Sprott for his continued support and increased participation in our business as he becomes an even larger shareholder in Americas."

Huet added: 

"The elimination of the silver stream agreement removes over $45 million in variable future debt obligations. By removing this encumbrance, we enable the strong progress of our operations to drive returns and silver price leverage for our shareholders directly to our bottom line. At current spot prices, this also represents a significant reduction of future cash debt service, allowing us to reinvest in operations for the benefit of our shareholders."

Strategic Endorsement from Major Shareholder

The conversion of the silver stream intChairman and Chief Executive Officer of Americas Gold & Silver, Paul Andre Huet, stated: 

"Today's announcement marks a significant step in further strengthening both our balance sheet and business via a very strong endorsement made by our largest shareholder. Mr. Sprott's decision to convert his silver stream agreement into additional Americas equity at a share price materially above his initial entry as part of the Consolidation Transaction, reflects his strong commitment to and belief in the value yet to be unlocked in our significant asset base. I would like to personally thank Mr. Sprott for his continued support and increased participation in our business as he becomes an even larger shareholder in Americas."

Huet added: 

"The elimination of the silver stream agreement removes over $45 million in variable future debt obligations. By removing this encumbrance, we enable the strong progress of our operations to drive returns and silver price leverage for our shareholders directly to our bottom line. At current spot prices, this also represents a significant reduction of future cash debt service, allowing us to reinvest in operations for the benefit of our shareholdero equity represents a strategic endorsement from Eric Sprott, who becomes an even larger shareholder in Americas through this transaction. The deemed share price of US$5.57 per share represents a material premium to Sprott's initial entry price as part of the Consolidation Transaction completed in December 2024, when Americas acquired full ownership of the Galena Complex.

Eric Sprott commented: "I have been very pleased with the outperformance of my investment in Americas Gold and Silver following the consolidation of my ownership of Galena in late 2024. In converting my silver stream into additional Americas equity, I am looking forward to increased exposure to what I believe is one of the most prolific silver mines globally operated by a management team that knows how to mine, scale production, and drive productivity."

Next Steps

The share issuance to Sprott Mining is subject to TSX approval. Following regulatory approval, the 7,956,696 common shares will be issued and subject to a 4-month hold period under applicable securities laws. The termination of the Silver Delivery Agreement will take effect upon completion of the share issuance, immediately removing the 592,000 ounce silver delivery obligation and the associated US$45 million in future debt obligations from the company's balance sheet.

‍