Golden Minerals to sell El Quevar silver project, provides corporate update

Golden Minerals has signed a letter agreement to sell Silex Argentina, its wholly-owned subsidiary that owns the El Quevar Project, and also provided updates on additional corporate activities. The company signed a Letter Agreement with Butte Energy whereby Butte agreed to purchase 100% of the issued and outstanding shares of Silex, which is the sole owner of the El Quevar project located in Salta Province, Argentina. The agreement is intended to be binding on the parties, pending negotiation of a definitive Acquisition Agreement on or prior to September 30, and closing of the sales transaction on or prior to October 31. The purchase price for the acquisition of 100% of Silex is $3.5B, payable in cash, as follows: $500K as a non-refundable deposit, payable to Golden by the close of business on September 3; $500K payable to Golden upon execution of the Acquisition Agreement; and $2.5B payable to Golden upon closing of the Transaction. Moving forward, the Company intends to concentrate its exploration efforts on its other projects, including Sarita Este/Desierto and Sand Canyon, subject to the availability of future funding. On August 28, the company sold its wholly-owned Mexican subsidiary, Minera Labri, to a private Mexican company for approximately $445.5K. Minera Labri held no assets but held net operating losses and inflation-adjusted capital contributions. All funds related to the sale of the CUCAs have now been received and are expected to be deployed to reduce existing liabilities of the company and its subsidiaries. In 3Q22, the Mining Court of the Province of Salta, Argentina, declared the cancellation of the company’s Desierto I mining concession. The company disputed the cancellation, and on August 28, the Court of Appeals of Salta ordered the restitution to the company of the Desierto I mining concession. The company’s only near-term opportunity to generate cash flow to meet its expected cash requirements is from the sale of assets, equity or other external financing. As of August 30, the company has cash and cash equivalents of approximately $0.9M. The company is evaluating and pursuing alternatives to obtain sufficient funds to continue as a going concern, including the potential sale of the company, finalizing the sale of its assets at the Velardena Properties, closing of the Transaction to sell Silex, seeking buyers or partners for the company’s other assets or obtaining equity or other external financing. If the company is unable to obtain additional resources, it may be forced to cease operations and liquidate.