Guanajuato Silver Company Ltd. (TSX-V:GSVR) is pleased to announce the closing of its previously announced brokered, best-efforts offering for aggregate gross proceeds to the Company of C$11,350,460 under a combined Listed Issuer Financing Exemption private placement under Part 5A of National Instrument 45-106 – Prospectus Exemptions and concurrent private placement to accredited investors. The Offering consisted of units of the Company at a price of C$0.20 per Unit. The Offering was led by Research Capital Corporation and Red Cloud Securities Inc. as the co-lead agents and joint bookrunners, on behalf of a syndicate of agents, including Canaccord Genuity Corp.

Each Unit consists of one common share of the Company and one Common Share purchase warrant. Each Warrant will entitle the holder to purchase an additional Common Share at an exercise price of C$0.30, subject to customary anti-dilution adjustments, until May 9, 2026.

Net proceeds from the Offering will be used to, inter alia:

• add to the Company’s underground fleet and ramp up production at GSilver’s producing mines in Guanajuato and Durango.
• fund certain improvements to expand and modernize the processing facilities at the Topia mine and mill complex including capital expenditures and related costs.
• fund corporate head office general and administrative expenses including legal, audit, overhead and salaries for the ensuing 12 months.
• carry out detailed exploration at GSilver’s mineral properties, particularly San Ignacio and Valenciana.

As part of the Offering, 43,125,000 Units were sold to purchasers pursuant to the LIFE Exemption in all provinces of Canada, except Quebec, and other qualifying jurisdictions, including the United States. In addition, 13,627,300 Units were sold to accredited investors under the accredited investor exemption contained in National Instrument 45-106 – Prospectus Exemptions in all provinces of Canada, and other qualifying jurisdictions, including the United Statespursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended, (the “1933 Act“), and applicable U.S. state securities laws. The securities underlying the LIFE Units are not subject to a statutory hold period under applicable Canadian securities laws. Unless permitted under securities legislation, the securities underlying the Accredited Investor Units cannot be traded before September 10, 2024.

In connection with the Offering, the Agents received a cash commission of $525,982, a cash advisory fee of $48,000 and 2,889,388 non-transferable broker warrants. Each Broker Warrant entitles the holder to purchase one Common Share at an exercise price equal to the Offering Price, subject to customary anti-dilution adjustments, until May 9, 2026.

To demonstrate continued support of the Company, certain directors, officers and other insiders of the Company and their affiliates participated in the Offering and acquired an aggregate of 2,515,000 Units for total gross proceeds of $503,000. Each subscription by a Related Party is considered a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The related party transactions are exempt from the formal valuation and minority shareholder approval requirements under MI 61-101 in reliance upon the exemptions contained in Sections 5.5(a) and 5.7(1)(a) of MI 61-101, respectively, as the fair market value of the transaction, insofar as it involves the Related Parties, does not exceed 25% of the Company’s market capitalization. The Company did not file a material change report related to Offering more than 21 days before the expected closing of the Offering as required by MI 61-101 since the details of the participation by the Related Parties were not settled until shortly prior to the closing of the Offering and the Company wished to close on an expedited basis for sound business reasons.

This new release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the 1933 Act, or any state securities laws and may not be offered or sold within the United States or to or for the account or benefit of a U.S. person (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws or an exemption from such registration is available.

About GSilver

GSilver is a precious metals producer engaged in reactivating past producing silver and gold mines in central Mexico. The Company produces silver and gold concentrates from the El Cubo Mine Complex, Valenciana Mines Complex, and the San Ignacio mine; all three mines are located within the state of Guanajuato, which has an established 480-year mining history. Additionally, the Company produces silver, gold, lead, and zinc concentrates from the Topia mine in northwestern Durango. With four operating mines and three processing facilities, GSilver is one of the fastest growing silver producers in Mexico.